Episodes

Rob Walling:
Welcome back to Startups. For the Rest Of Us, I’m Rob Walling, and in this episode I sit down with Einar Vollset, co-founder of TinySeed, and we take it in a little different direction than we normally do. Oftentimes when we talk about TinySeed, we will talk about things that we’ve learned investing across all these SaaS companies that could help you as a B2B SaaS founder, or maybe I’ll interview a TinySeed founder so we can take learnings and apply them to the broader community and the broader audience. But in this episode, Einar and I talked through something that he actually knew quite a bit about when we started TinySeed and I knew very, very little about, and that is startup investing and venture investing and why people would invest in a fund versus investing individually. We talk a little bit about the math of Venture and how and why TinySeed is so different, but we also talk about the fact that the venture industrial complex has really left behind thousands and thousands of startup founders, and that really was and still is the goal of TinySeed. 

As you know, my mission is to multiply the world’s population of independent self-sustaining startups. TinySeed is part of that because no one else was serving that market when we stepped in. And so this episode is a bit of inside baseball. It’s a look behind the curtain of running a venture fund and TinySeed even a bit about the broader venture space. I find this stuff super interesting because it’s not something that I have ever been exposed to before running this fund. And who better to explain it than TinySeed co-founder a r Ette? Before we dive into our conversation, MicroConf Connect applications are open until tomorrow, January 15th. MicroConf Connect is an application only paid community. If you sign up in the next couple of days, you get access to our upcoming workshop with Kate Summa on January 23rd, 2025. You’re going to join Kate live as she delivers SaaS onboarding best practices and tips. Plus does a live teardown of a Connect members onboarding experience. We do a live workshop or event or sometimes it’s a q and a with me once a month every month for paid MicroConf Connect members. Head to MicroConf connect.com in the next 48 hours to apply and get in our January batch. And with that, let’s dive into my conversation with a R in our set. Welcome back to Startup For the Rest Of Us.  

Einar Vollset:
Thanks for having me.  

Rob Walling:
It is good to have you on the show, man. Folks know you from Hot Take Tuesday. They also might know you as the managing partner of Discretion Capital that helps seven and eight figure SaaS companies sell for amazing outcomes as well as co-founder of TinySeed. There  

Einar Vollset:
You go. It’s nice to have you all to myself without Tracy interjecting with her blue sky nonsense.  

Rob Walling:
Seriously, our open source communist  

Einar Vollset:
Blue sky. Yeah, yeah, that’s right.  

Rob Walling:
This is great. Hey Tracy. Hi Tracy. So today we’re going to go a little off the startups For the Rest Of Us beaten path, so to speak. And I have had a crash course over the past four or five years in not only just investing in startups, but then venture investing and what that looks like and how if you are a venture fund and you don’t return what the s and p 500 does, then you crash and burn. And I didn’t even realize that was possible. How valuations are created and frankly, we’re going to talk about TinySeed, the stuff we’ve learned. This is not just a big sales pitch of TinySeed. We are fundraising right now and folks can reach out to you TinySeed dot com slash invest if they want to get in touch if they’re an accredited investor. But the idea here is to share a bunch of the learnings that you and I have had. I think you had a lot more back in 2018 when we started this, but to talk about investing in startups, potential outcomes, and frankly, I also want to talk about TinySeed and really dig into why it’s different from say someone going through yc because we have folks who get into both and who have gone with TinySeed and that blew my mind to me. YC has been the gold standard of gold standards since I was a wheel ad and there really are some differences that cause folks to want to go the TinySeed path.  

Einar Vollset:
Yeah, that sounds good. And also I think it’s just even if you’re not going to go for TinySeed, you’re not investing in VC funds, I think it’s helpful to understand if you are thinking about funding, whether from TinySeed or other people, I think it’s worth understanding what are the incentives, how does this work on that end so that you understand what you’re signing up for.  

Rob Walling:
Yeah, it’s interesting. In bootstrapping, let’s say 10 years ago, gosh, when I did my talk, no, it must’ve been 20, I guess I did a talk 2017 or 18 at MicroConf four. I said, I think bootstrappers are going to start raising funding. And I hinted at it in a five minutes section in one thing and kind of got some pushback. And then the next one, half the talk was about it and it was right as we were starting TinySeed. And some people were like seriously pissed. They’re like, what? 

Pushing your book, since you’re doing that, you’re saying people should do it. And I was like, no, people are already doing it. That’s why we’re starting TinySeed is because there’s opportunity here. I had already invested in, I don’t know, eight maybe eight or nine, about eight kind of bootstrapped SaaS, mostly bootstrapped SaaS that I just put my own cash into. And so the openness and frankly the stigma of raising funding as I won’t say it’s gone because every once in a while I’ll see an any hacker post on Twitter about this is why I don’t raise funding, quoting some anomaly somebody sells for, what was it? Was it FanDuel or something sold for 500 million and the founder got nothing, but it’s like, yeah,  

Einar Vollset:
A lot more to that story, I’m  

Rob Walling:
Pretty sure. Yeah, there’s more to a story than that. So there’s always these exceptions, and when we surveyed folks for the state of independent SaaS, it’s somewhere around one in four or almost one in three, around 30% of bootstrap founders say they would at least consider raising funding.  

Einar Vollset:
Well, I think it makes sense. And also this has always been my thing. A little bit of a pet peeve thing is like, look, some of these purists on the never raise any funding part is they never raised any funding. Oh, is that because your wife works full time at Morgan Stanley and so basically can support you or you have rich parents or you’re basically wealthy. So it actually sort of democratizes starting your own SaaS business a fair bit for those that don’t necessarily sit on a bunch of cash.  

Rob Walling:
And it certainly makes it possible for less technical folks to do it as well because such a big cost. I was never anti funding. And even in the days of Drip considered like, man, it would be so much easier if I could raise four or $500,000, but I didn’t know anybody didn’t know how to do it. It was 2014. It is like all the stuff that’s available today wasn’t out there. So with all that said, with that preamble, let’s talk a little bit about venture investing, what success looks like and frankly, how many venture funds just miss the mark and don’t even beat an index fund that I could buy a Vanguard index fund?  

Einar Vollset:
Oh yeah, for sure. I mean, yeah, I think it’s just worth for people to think about. I think sometimes people think, oh, investing in VC funds think Sequoia Andrees and whatever, and it’s just like, oh, it’s how you get a hundred x. You read about these outcomes and you think they’re going to a hundred x. The fact of the matter is if you look at one of the golden decades for venture investing in the US was the decade between 2004 and 2014. It includes a bunch of, now well-known names came through that decade. And so you might think to yourself like to be in the top quarter of performance of venture funds in terms of return capital in that quartile, you probably returned, what do you think, like five x, six x, some of that, in fact, the actual math is more like two x, I think it’s 2.16 or something. If you as a venture fund in that decade, which was a good decade for venture funds return 2.1 x, then you were in the top quartile of funds.  

Rob Walling:
So that means if I invested a hundred thousand dollars into that fund, I got my initial a hundred thousand back and then an additional $210,000. Is that  

Einar Vollset:
Right? No, no. You put a hundred thousand dollars in and you got $216,000 back. So it was a 2.1 x  

Rob Walling:
And over the course of what, seven to 10 years?  

Einar Vollset:
Up to 10 years,  

Rob Walling:
Unreal.  

Einar Vollset:
That’s a tough quartile fund. 

And really the reason is because a lot of funds, and also look, I think the median fund still returns at least one x, but there is a good number that returned less than one X. It’s probably 40% of funds, you don’t even get your money back. That’s pretty common. And so then you look further is like, okay, well what’s great performance in venture? Clearly two x over in that same timeframe, the s and p 500 probably went way up. I mean it had the housing crash in 2008, but nonetheless, what is amazing world-class looked like? And that’s actually in that quartile, it was just over five x. So if you five x, if you’re a venture fund, that five xd, then you were in the top 5% of funds in that timeframe. And I think the reason why people sort of misunderstand this, they think venture and then they think like, oh, what do I think about when I think about venture? 

Well, it’s like Airbnb type returns. You hear about yc, they invested at whatever, probably put same. I was in the same batch, so I know what they put in probably 40,000, $20,000 and a thousand x or something like that. And so I think that sometimes translates into, oh, at the fund level, that’s the kind of return. So maybe not a thousand, but you’re getting a hundred times your money. But that’s an extreme outlier for venture funds. And really if you’re looking for a thousand X, you shouldn’t be in venture, you shouldn’t be in venture funds. That doesn’t make any sense. It’s almost impossible to get a thousand. It is impossible to get a thousand X in a venture fund or even a hundred x. If you’re wanting to do that, then you should put all your money into single bets. You should be investing in individual companies and concentrate your position as much as you can into your extreme high conviction bets and just go for that. 

And that’s the way to do that. But a lot of investors, they don’t want to do that. So the question then is why would you invest in a venture fund instead of doing that? The reason is you’re reducing risk. That’s what you care about. You’re basically trading off. You’re saying, look, okay, I’m willing to forego this notion that I’m going to a hundred x my money, but the flip side is I’m less likely to lose it all. The standard outcome if you invest all your money into a single company is you’re going to lose it. At least an early stage company, you’re going to lose all the money. And if that’s not something that you want to do that’s not part of your investment strategy, then investing in a fund makes sense and you’re making that trade off then,  

Rob Walling:
And that makes sense to me. So I entertained, after I sold Drip, I had a little bit of cash on my hands and I entertained the idea of investing in a couple of different venture funds and I never did, but it wasn’t because I didn’t think the returns would be there. It was because I had enough people approaching me through MicroConf and this podcast where I was like, that’s a legit business. Like Jordan Gall, right? With Card Hook at the time, and Justin McGill with lead views and there were just these great little B2B businesses. I was like, I kind of had enough people coming my way at reasonable valuations. To be honest, when I went on AngelList, here was the problem. I went to AngelList. I was like, oh, I’m going to make a few bets. And holy mother of, I mean the valuations for almost no revenue were like 10 million. And I did, I put five grand into one of those and I put 10 grand into another, and all of them either went to zero or returned one return to me, 11 grand from my 10 grand investment. I was like, all right. I consider that’s good,  

Einar Vollset:
Mean it’s probably above way above average return. So good job, yo.  

Rob Walling:
It really is. So I’m in a little bit of a unique position. I mean the whole thing is the deal flow is kind of coming to me.  

Einar Vollset:
Well, I think that’s the key thing. I tell people this and I’m not being unusually humble about this. And the fact is tiny C wouldn’t work if you weren’t there at least the early days. I don’t have the deal flow, I just don’t. And I think because of your background with MicroConf and startup For the Rest Of Us and all this stuff that people know about you, and there’s probably you and I’ve been saying there’s less than half a dozen people worldwide that naturally has that kind of deal flow, quality, deal flow, pricing power that’s coming your way. And I think really that’s part of the reason why you would invest in a fund. Because if you look at it, say you have an amount to invest, whatever that is, a hundred thousand, 250,000, 500,000, whatever, it’s okay. Well, if you do your research and look, you realize you probably shouldn’t just pile into just a single bet. 

You put it all on black as it were. So instead what you want to do is you want to go out and you want to make a lot of bets. Ideally, you probably, I think the math pretty much says if you’re going to have a better than 50% chance of at least breaking even, you should be making at least, I think it’s somewhere like 15 and 20 bets, like investments rather than bets. I shouldn’t call it bets 20 investments. But if you think about, okay, how do you do that? If you have a hundred thousand dollars, you say, okay, I believe the math, I want want to put a hundred thousand dollars in, now you have to write 20 checks of $5,000 each. Now you have more problems than when you started because do you have the deal flow to find 20 quality investments? Are you going to see enough good deals just from your networks and friends and connections and whatever on AngelList or whatever in order to make those investments? 

And I would argue that most of the time you don’t get to access the deal flow, you just don’t have it. But even if you did, so say you were uniquely well connected, now it’s like, okay, now you need to convince people to take a small check from you individually. So now most people aren’t going to take most people who invest, an individual investor that goes along and says, all right, well I want to put $5,000 in. It actually can be quite hard to, even if people are raising money, it can be quite hard to get people to accept $5,000 because it’s such a small check. So there’s usually a minimum before you have to get in.  

Rob Walling:
Absolutely. The minimum, in my experience, I believe every company I invested in was 25,000.  

Einar Vollset:
Yeah,  

Rob Walling:
Yeah. I mean I’m sure friends, you can get a friend who can cut you a deal or whatever, but if you are trying to make that many investments  

Einar Vollset:
And quality investments, a friend will do it. That’s great. But how many friends do you have? Do you have 20 friends that are really truly rigorously is high quality and that you can put $5,000 in? It starts to get difficult. And then on top of that, even if you get past, can I even get my check in? Can I get the deal flow? Then it’s like, okay, well who’s setting the price here? Are you going to be able to get it? Because whatever VCs tell you the name of the game in VC is entry price, exit price. If you overpay for your investments, then you’re not going to make any money If you invested 50 million pre for pre-product, pre-revenue business, it’s a really big hurdle for you to make a reasonable return obviously because you overpaid for it. And so that’s sort of the third thing that comes into it. It’s like, do you have the pricing power? So can you get the deal flow? Do you have the pricing power to get a reasonable valuation and can you even put your money in? And that’s alongside, okay, well you probably have a full-time job. How often are you doing these investments? Are you learning fast enough to stop doing stupid and start doing good investments? And that’s really the reason why along with spreading a risk, why people invest in venture funds as opposed to just being individual angel investors.  

Rob Walling:
And this is one reason that venture funds became content marketing machines and built brands. Do you remember, this is a recent phenomenon. I mean maybe at best it was between 2005 and 10 is my memory when they started really coming out. Because in the nineties, I grew up in the Bay Area, lived there, I worked construction there. I didn’t work in startups, but there was nothing published by venture funds. It was very, what do you call it, information asymmetry is my memory of the whole thing. It was very opaque. You didn’t know what term sheets, what even, I didn’t even know what terms meant and everybody was hiding everything. And it felt like in their early 2000, mid two thousands, probably around the time yc like Paul Graham and YC started coming up. The VC started marketing themselves as the Andreessen Horowitz and the Sequoias where they were putting out stuff first  

Einar Vollset:
Round, first round first was one of the main ones that did the early days and  

Rob Walling:
Then came 500 startups and Techstars where it’s like, here’s content to help founders. Here’s what a VC term sheet looks like. Here’s what all these terms mean. Here’s how you can get screwed by liquidation. And there’s the preferred and then participating. And there’s all these things that you didn’t even know what they meant. Brad Feld, right? He wrote a bunch of books about it. That was a big thing was for them to start a generating deal flow, but B, to get the trust I think from people so weren’t because you were a commodity before, it’s kind of like if I’m going to go borrow money for my house, who’s going to give me the lowest rate we know with no prepayment penalty? That’s it. It’s commodity, it’s numbers and it’s pricing. And that’s what I think veg was a little, at least from my perspective, was a little more like that at one point. And then it became not right, it became how do I get people to know me such that I do have some type of pricing power and also a lot of inbound interest.  

Einar Vollset:
And I think I know for a fact that’s sort of what YC partly y YC started is because it used to be kind like, how do you get access to this? And it was like, oh, my dad plays golf with this lawyer who can get you an intro and then you could get, but I think in part that’s why VC started out so geograph and remained to this day, so geographically concentrated because sort of what it was, everyone was sort of there and you had to be there. You had to be in Silicon Valley in order to get money and you had to have those connections and be able to work a warm intro. I mean, that’s still the case for the cases. People are figure out a way to get an intro. To me that’s turtle number one kind of thing. So for sure that’s been part of it.  

Rob Walling:
So let’s talk about valuations, how these valuations happen. And there was a big realization at one point where you and I were talking because I had always heard, boy, you need billion dollar exits in order for a venture fund to make money. So TinySeed is this question I think I asked, I think everyone asks, so how does TinySeed make this work without a billion dollar exit? How does all that work?  

Einar Vollset:
Well, I mean there’s a couple of different things here. And actually a billion to a degree, a billion dollar is apparently too small even in some cases. There was actually, I think it was Sam Altman who wrote a piece, not Mr. OpenAI, but used to be president of yc. He wrote a piece How to Invest in Startups, and I think that was like 2018, 2016, something like that. And his main point in that article, which I still think is up, was you shouldn’t invest in anything unless it can be 20 billion or more. Just don’t even waste your time unless you think it can be a 20 billion exit. I mean that article was in part the reason why TinySeed became a thing, because crazy  

Rob Walling:
It is.  

Einar Vollset:
I get it. He’s talking his own book at the time. That totally makes sense. If you have a lot of aum, a lot of money to put on, and you’re writing big checks and big outcomes and this is what you’re doing to a degree, it doesn’t matter. Entry price doesn’t matter, valuation doesn’t matter. You just got to find that thing that goes to 20 billion, that’s the whole game. And while that’s true, if you’re playing that game, then that’s how you should be playing that game effectively. Our argument was like, look, there’s got to be a way in which founders and investors can both succeed, where outcomes are not quite 20 billion. I think most of the people listening to this would agree that a 75 million or a hundred million dollars exit, even if it’s selling to some lowly private equity fund, that’s pretty good. I think a lot of people listening to this would think to themselves, if I owned 80, 90% of a company and sold for 75 million, I’d be having a pretty good Christmas right about now if that’s what was happening. 

And so effectively what we were thinking with TinySeed is like, look, there’s got to be a way where you can have that be success and everybody makes out well. And that’s sort of the ground thinking on the investing side for TinySeed is like, how do we make that happen? And really what that boils down to is a couple of different things. One is I don’t think it works for every single industry, every kind of product, every kind of service. There’s just some things that are just requires a lot of capital is extremely capital intensive. It makes total sense to keep raising money. And if you keep raising money and burning money, then the sort of winner take all stuff makes total sense here. Your Airbnbs, your hell, your new open AI stuff, it makes total, I’m not reasonable, gazillion a trillion dollars and this whatever. 

And even some of the smaller stuff is like, look, my standard thing is like look, if you’re going to be doing a home grooming startup service type thing that it’s going to be capital intensive. It’s like a Uber, you got to spend money on it and you’re going to get diluted up to wazoo and you have to gun for an enormous outfit to make any money. But what we realized is like, okay, but there is this subset of specifically B2B SaaS where it can work because for a couple of different reasons. One is it’s so capital efficient. A lot of the time the gross margins are like 95%. That’s not unusual. And quite often on the discretion side, I talk to founders and they’re like, yeah, do you think I’m profitable enough? I got 65% free cash flow. I’m like, okay, yeah, I think you’re profitable.  

Rob Walling:
This is great on recurring revenue, on millions in recurring  

Einar Vollset:
Revenue, you expanding revenue. And it’s like, it’s crazy. I mean you even see this and some of the go public companies like Zoom, and I think Zoom actually is the sort of poster boy for this, the Zoom, I think they went public with more money in the bank than they raised  

Rob Walling:
Something like that. It’s just incredible once they hit escape ity.  

Einar Vollset:
Yeah, and that’s sort of what B2B SaaS is like. And so I think it works for that and in a sense that there is this notion that basically if you take a little bit of money once and then you don’t need to raise anymore. You can if you want to, but you don’t need to. And so that’s what works for TinySeed or mostly Bootstrap or TinySeed like companies. And if you combine that then with what we consider to be reasonable valuation. So I think if you’re playing the classic VC game, 20 billion a bust, yeah, you’re right. It doesn’t matter that you’re paying 25 million for a pre-revenue product at YC demo day as a seed investor, it’s fine. Who cares if you could invest 25 at 25 million valuation into open AI or Airbnb, then great investment, go do it, but 25 million say and then it goes to a billion dollars. 

Let’s just say that rather than 20, let’s be a little less ambitious than Mr. Altman was. That’s a 40 x return on your money. That’s a good return. That’s a great return, sadly. And we can get in the math area, you might not be good enough for an investor like a fund investor, but the flip side of that is a billion dollars is still a billion dollars. It’s still kind of an unusual outcome. And I’m not saying valuation here. I’m saying actually cash like IPO or selling or whatever, not just make-believe valuations actual money in the bank. And I think that’s pretty rare. And the fact of the matter is if you come in, the kind of valuations that we do at, and it’s capital efficient enough that these companies aren’t raising money all the time. So say if we come in at a couple of million and 1.8 I think is our average, and then you 40 x that, that’s 70, 72 million. 

72 million is still a lot of money, but it happens a lot more frequently than a billion dollars in discretion capital. We’ve done several deals this year that have been sort of in that range, and that’s just us and nobody ever reads about them. We actually did one years ago now we did that iceberg, the measuring the depth of the software iceberg title based on Patty eleven’s quote and observation there around most people don’t know how much money exchanges and so about for these kinds of outcomes and how common the big ones are or the reasonably sized ones. So that’s what it boils down to. Basically what we’re arguing is like, look, if you’re going for that kind of enormous outcome, then yeah, it makes total sense. Raise it 25 million and capital will go for it, become open ai become Airbnb. But there’s also this other class of startups where if you’re B2B SaaS and as an investor you can put money in at a couple of million and then they sell for 50 to a hundred million dollars, that’s as good. It doesn’t matter to you if you get 40 x your money, what do you care whether it 40 x means 75 million as an exit or 40 x means a billion dollars? It doesn’t. I mean other than bragging, right? It doesn’t matter. It just end price. Exit price.  

Rob Walling:
Exactly. And that’s the thing, the epiphany that I think I had at one point, or you kind of explained that to me, and it totally makes sense when you didn’t name the numbers, but the fact that the venture industrial complex is so focused on valuations and so focused on these large exits has almost to a point, like I’ll say brainwash some folks into thinking that’s the only way to do it. And what it does is it leaves out, I talk about my 1 9 90 rule where I say around 1% of startups should go after venture, about 90% should bootstrap. And I think about 9% should raise probably some type of funding. Maybe that’s TinySeed, it’s angels, but it’s not venture track. And the idea there is that going for 10 billion, 20 billion outcomes, it leaves out so many founders, thousands of founders who maybe should or maybe want to raise some type of money and still have a great outcome. 

And there is really no outlet for that. Before that we knew about it. Before us, it was ind BC and us. And then there’s obviously some individual investors. There’s a handful of others, but that’s where it is. And so what’s a trip is every application process for TinySeed, we do run it twice a year. Every six months, we inevitably get one company that we make an offer to and they come back and say, we’d love to take your money. We want to be part of it. But we were looking for a 10 million valuation. Or someone came, remember someone said 20 million and they were doing 30, 40 KMRR, whatever. I mean it was a respectable company, but it’s like, no, we’re like, no, you don’t understand. You don’t get your cake and eat it too. You don’t get TinySeed at that valuation. That’s not how we work.  

Einar Vollset:
And I think also some people, although I think awareness is raising a little bit, what some founders don’t understand is, look, there are trade-offs to this. Obviously if you can raise it a hundred million valuation, billion dollar valuation, there’s really great things about that. But some of the bad things are, there’s a whole universe of outcomes that are not the doors closed for you. If you raise it $25, the chances that you’re going to be able to or be allowed to sell for 50 is very low. In some cases. If you have extreme power and all this stuff and you didn’t give you any rights, that’s fine. But if you push valuations, the highest possible investors are going to put control provisions in there that sort of says, okay, look, the reason why we’re giving you this high valuation is because you’re saying you’re gunning for this enormous outcome. So we’re going to put some barriers in place. I mean, that pushes you, that aligns everyone to that kind of outcome or nothing, not get a high valuation and then sell for a reasonable amount. That door is very often closed.  

Rob Walling:
And that’s the challenge is especially if you’re a first time founder or have never had a big exit, I heartily believe this, and I’ve heard Dharmesh say this as well, so it makes me think it’s a really good idea, is if you haven’t had an outcome yet and you get some type, you get an offer for never have to work again, money. I don’t know man, I’ve the mind to take it and maybe that’s 10, maybe it’s 20, maybe it’s 30, it’s nowhere near what we’re talking about here, but get one, get a win, then you can do whatever you want. And I’m so much more an ascriber to that to kind of tucking that away. So I know of a company, I’ll keep anonymous, that raised, let’s say a prize was under 40 million in venture over a few rounds and due to liquidation preferences and other things, they would’ve had to sell for something like 80 something million for anyone but the VCs to get money, right? 

It’s like two x, I dunno all the details, but that’s the kind of stuff that I’m not sure people are aware of when they’re like, I’m going to raise it 10 or 20 million. It’s like, oh man, you’ve just really cut off a lot of your optionality. And that was such a big thing. I don’t say this as much when I talk about TinySeed these days, but in the beginning it was just optionality. We are optionality you can raise, you cannot do what makes sense for you. And we have had a bunch of people raise series. We’ve had a handful of folks raise several million,  

Einar Vollset:
A handful, but actually just to change track a little bit, not as many as I thought. It is funny, we raised our second fund in 2021 and obviously 2021 was a good time in the markets. And at the time I remember looking, I was like, oh, about 30% of the companies have raised money. That’s what I used to say. About a third, about a third. Then I was coming around to fundraising again. I was like, okay, let’s look at this. Actually it’s 8%, our tiny company less than 10  

Rob Walling:
Because 2022 and 2023 was such a disaster. There’s not that much capital. It’s very expensive now. And so that the number just plummeted. Right?  

Einar Vollset:
Exactly. And so they just haven’t done that. They just haven’t, have you raised any money? Money? And actually that sort of relates back to how the TinySeed different, and it’s like why I think people maybe don’t understand is how do venture measure performance on the way? Because the issue with a venture fund is like, well, good and bad. You don’t know for any good for at least 10 years. So if you’re a charlatan, you can kind of keep going for 10 years and say, oh, I’ll prove you’re right in a couple of years here. But I think it’s understanding how does most VCs, how does that make our life hard? Why is it a problem for a venture fund that only 8% of your companies have raised further funding? And the answer is, as traditional venture fund, it’d be a failure if only 8% of your companies raise money. 

And the reason for that is the way that venture investments work is that you as an investor when you come along or GP like a VC, basically you come along and you’re basically, every quarter or so, you send an update to your investors, to your LPs basically that says, this is what my portfolio is worth. And the way that you do that, obviously they’re not publicly traded. And so what you’re doing is you’re basically doing two things. You either keep the market the same, if they’re just nothing material has changed, IE, they haven’t gone out of business or they haven’t raised money, or if they raise money, then you mark it up to this new valuation because of the length of these funds, most of the time a successful VC can raise several funds without returning any money at all. It could just be like, Hey, I’m raising fund number three and look at my performance on my fund one and my fund two is up three x or whatever, two x five x. 

And it’s all based on markups. It’s all based on how successful are you, are your portfolio and raising subsequent raise more money at higher valuations to a large degree what success is in vc, if you can have a fund that, this is probably why YC is such a great business. They invested one point, whatever they do, and then it’s like the standard valuation markup three months later at demo day is like 25 million. Well, that’s an enormous markup straight there. It blows everyone else out of the water. They capture a lot of that value to be perfectly honest. And so what do we do well? So we have to come up with something different, which is always kind of challenging. And I think the difference for us is what we’re trying to do is to say, look, these companies, this successful companies don’t really need to raise any more money after this because they’re so capital efficient. 

So how do we capture the fact that the successful companies don’t raise any more money so there’s no automatic markups? And actually it is funny guys, in 21 when we had more markups and stuff, I remember doing it this way and I was just like, okay, well we will mark out why not? We’re not going to handicap ourselves. People would ask ’em. There’s really not necessarily quite of a correlation between the success of the company and the valuation markup. Because in 21 in particular, and this is true in all bubbly things, you would have people who raised because they were doing really well, and then people who raised because they were doing really badly and they were running out of money and they were going to go under unless they raised money. And so they were able to do so, and then they got marked up above what even some of the best performing companies that we had. 

And so what we decided to do was basically say, look, we’re going to give you a market price. And so we have a couple of different variants on this, but sort of our sort of base case valuation, which is most of the numbers we share out, it’s basically some sort of a revenue multiple based on growth mostly. And it’s somewhere between two X and somewhere between seven x. And really what that valuation is is different to even a typical VC markup in the sense that, look, if you raise a series A at billion dollars, that does not mean you can sell your company for a billion dollars. That’s just not happening. Obviously if you raise a 200 times a RR, you’re not selling it 200 times a RR. It’s not possible. Our base case valuation though, is more like what is the market price currently? What is the clearing price  

Rob Walling:
Sell for?  

Einar Vollset:
Yeah, what is the liquidation price of the portfolio at the moment? And that’s what we go to market with, which is kind of a handicap, I’ve got to be honest with you.  

Rob Walling:
Oh, big time. Much more conservative.  

Einar Vollset:
Much more conservative. And we provide the optimistic case, which goes up I think to up to 11 x, and we have one which includes the markups whenever they happen and they’re a little bit more, but most of the time we’re referring to the base case. So liquidation type valuation. And the reason for that is mostly that I want to be as conservative as possible. A, I basically want to be able to argue because we’re already doing something different. We’re not your typical what everyone else is expecting and like, oh yeah, this is how you get through an audit at Carta because the markups is from Andreessen and blah, blah blah. So we had to be a little bit more conservative. It can be a challenge. Although I will say, and although it’s not apples to apples, I was pretty stoked when card, which is our fund management platform, they came out in the spring with a performance metrics of 1800 funds, which actually includes us. And we were in the top five to six to 16% based on the venture metrics there, even using our most conservative metric evaluation. So that felt good, but it’s still a challenge because it’s new. People would rather have, in some cases, people are like, look, I believe that this company is worth a billion dollars because Andreesen says so even though they’re only doing 500,000 a RR more than I believe that this company is worth five XARR.  

Rob Walling:
I call it brainwashing or whatever it is. It’s a standard. It’s the safe. It’s nobody gets fired for buying IBM, right? It’s just the way,  

Einar Vollset:
Right? I mean, that’s always the case. I mean venture, I’m going to side ran here about venture and branding and stuff, but venture, I think a lot of the time it’s sort of a self-fulfilling prophecy. If you get lucky very early on in the early fund and you get the brand built, then you sort of like capital comes to you and deal flow comes to you and it’s sort of self-fulfilling prophecy that you do pretty well. So my one piece of advice, if you want to be a classic VC and you want to start a new venture fund, is to be extremely lucky with your investments in your first fund. That’s the way to do it.  

Rob Walling:
That’s all you got to do. Just be lucky.  

Einar Vollset:
Just be lucky. That’s good.  

Rob Walling:
No hard worker or skill. Let’s just go all after luck on this one. Yeah,  

Einar Vollset:
I’m not investing hard luck or skill. I’m just saying given a choice, you would rather have be lucky than good. You’d rather be  

Rob Walling:
Lucky. Yeah. So as we wrap up, if folks are listening to this, if someone is an accredited investor, we are raising our next funds to invest in ambitious B2B SaaS companies. They can hit you up directly, TinySeed dot com slash invest. If they fill out that form that goes directly to your inbox. Anything else you want folks to know?  

Einar Vollset:
No, I mean, I think that’s it. I mean, it’s a little unusual. We’re just sort of like, this is, again, like we were saying, it takes 10 years to know if you’re good in this game. And we’re like, we’re in year five and indications are good.  

Rob Walling:
That’s what it is. The markers, yeah, the arrows are going in the right direction.  

Einar Vollset:
Things are good. We’re not a little bit unusual too. We’re not vastly increasing the size of our fund, which is quite common in the VC world. It’s very often you start with a small fund and you quadruple it and then that works out and you quadruple it again. And we’re not doing that. We’re just sort of like, look, this is what we feel good about. This is the size of this opportunity and we’re keeping the funds sort of the same and just keep executing the way it has been because it seems to be working. We think it will be continued to,  

Rob Walling:
And the reason VCs do that is that’s how you make more management fees is the bigger your fund, the more money you make. And we’re like, you know what? The opportunity that the deal flow we see in a six month period is X. It’s been really consistent, which is great, and we don’t want to raise twice as much money. Then what are we going to do invest in? We’re not going to double our deal flow in the next six months, maybe we’ll over years, but  

Einar Vollset:
We might put more. There’s opportunities we could put more money Dividual companies do. We do all this stuff. But fundamentally, the core strategy of TinySeed sort of remains the same. This is the size of the opportunity. This is what we think believes, and there are numerous venture funds that have done well at say, being a 25 million fund, and because they’ve done so well, lots of people are interested and then they decide, let’s raise $250 million. But if you’re 250 million, all of a sudden you’re doing different kinds of investments, maybe even in different kinds of companies, different stages. Who’s this? You’re good at that. Just because you’re good at writing $250,000 checks does not mean you’re good at writing $5 million checks into later stage companies. And your competition might be different and your deal flow might be different and your pricing power might not be there at that stage and all this stuff.  

Rob Walling:
So we’ve invested in almost 200 companies over four and a half years, and we’re going to stay at that pace. So the indexing across a lot of ambitious B2B SaaS companies seems to be working for us so far.  

Einar Vollset:
It allows us to keep the sort of batches small, right? It’s nice to have that, some of that intimacy. We’re not 150, 200 people in batches. We’re talking 20 people, 25 people, which is nice.  

Rob Walling:
TinySeed dot com slash invest if anyone’s interested. And a R volt on Twitter X Twitter. If folks want to see you posting about these San Francisco Giants  

Einar Vollset:
Or a r volt.com on Blue Sky. No, I’m only  

Rob Walling:
Kidding. Oh my God. Record scratch. I was like, what? You’re on Blue sky. You’re going to lose your bet. You’re going to lose your be to Tracy, thanks again man. Thanks for coming on the show.  

Einar Vollset:
Thanks for having me.  

Rob Walling:
Thanks again and R for joining me this week on the show. Thank you for joining me this week and every week. This is Rob Walling signing off from episode 748.

Rob Walling:
Welcome back to Startups. For the Rest Of Us, I’m Rob Walling, and in this episode I speak with Jane Portman, the co-founder of User List, about how they’ve evolved their SaaS customer success process over the past seven years of running their mostly bootstrap company. In this episode, we cover the four stages that their customer success process has traveled as it’s evolved over this time. Before we dive into the conversation, I wanted to let you know about an effort that the team at TinySeed and I have been working on here in late 2024. It’s premium coaching and community for SaaS founders doing 1 million a RR and up. Right now we have a teaser page up at SaaS institute.com. If you are a founder who is at or in the neighborhood of 1 million a RR, any your email there and we will be reaching out with more information. 

This is going to be an elite and exclusive community application only hand chosen. It’s not intended to be an extremely large group of people, but it’s intended to get those that are at that point where YouTube videos and podcasts and even books are less and less helpful because you need more one-on-one focus and you want to be matched in a mastermind with other ambitious like-minded founders and you want to receive direct advice from handpick mentors and who better to do that than TinySeed. This is separate from our accelerator, right? Our accelerator is where we invest in early stage startups that are doing what between one and 2K MRR on the low end and maybe 40 k, 50 K on the high end. This is a high-end and highly curated premium coaching offering for those that are further along, basically doing seven or eight figures in a RR. So if you’re interested, SaaS institute.com. And with that, let’s dive into my conversation with Jane Portman. Jane Portman, welcome back to  

Jane Portman:
Startup For the Rest Of Us. Super thrilled. Super thrilled. It’s been like five years, right?  

Rob Walling:
It has in fact November 19th, 2019, episode 4 71, fighting to gain traction in a crowded space with Jane Portman of  

Jane Portman:
Still fighting,  

Rob Walling:
Still fighting in a crowded space. That fight never ends. Jane, let’s just be real. So for folks who aren’t aware, user list.com, you’re seven years into building that business with your co-founder Benedict, who many will know you and he from micro comps. The H one is email marketing automation for SaaS growth. User list is more than just an email marketing platform where your partner in successful implementation, you get proven SaaS frameworks, one-on-one onboarding and a dedicated support engineer so you can focus on hitting your growth goals. So tell us, Jane Portman, where does user list stand today? Give us an idea of how big the business is.  

Jane Portman:
Long story short, we a team of six all over the world and roughly profitable,  

Rob Walling:
Roughly profitable is just fine. You are a TinySeed company. You were in batch two, is that right? 2020,  

Jane Portman:
Yeah.  

Rob Walling:
Spring  

Jane Portman:
2020. Covid specifically March, 2020, which was very bright experience.  

Rob Walling:
Hey everybody, let’s meet up for an in-person. Well, we’ll do an in-person in six months. That was basically that year. That was tough for everyone too soon. I won’t drag everyone’s memories back to Covid. But today I wanted to have you on so we could talk about how you and your team have evolved your customer success practices over the last seven years. And before I hit record, you and I walked through and put together an outline of the four stages that you’ve traveled. And I really like this framework of thinking about getting something out that’s good enough. I actually talked about this in an episode just a couple of weeks ago. It’s first making it work, then you make it right and then you make it fast. And I feel like over the last seven years, your four stages have made it work, have made it right, and have made it fast. 

So talk us through before we dive into stage one, which I love that you said, it’s young and naive, that’s what we’re going to call it. Just talk about how customer success works for you in the business. What’s involved in customer success for you? Trying to get people onboarded into a very powerful product because this is a conversation I have when obviously I ran Drip, which is a similar type of company, very complicated. I would say it’s powerful. Drip is powerful, very complicated. And folks who run reen, and I’ve had this conversation, it’s electronic signature Reuben’s like people come in, there’s a button to upload a doc, you drag a signature field there, you’re onboarded. And I was always writer like Derek was, I was like, you create a link, you send the link, people book the link. I know there’s more to it than that, but realistically there are different gradients of complexity with products and not all customer success approaches work for each of them. And so you can be naive if you’re going to build a really complicated slash powerful product and think that, ah, everyone’s just going to self-serve and get on board. So with that preamble, talk us through user list and how that journey has been for you from a high level,  

Jane Portman:
If we knew what it takes for people to integrate and get started, if I knew as much as I know now, we probably just would not start, would not have started so many years ago because it’s insane. Somewhere in the middle we had a consult with a hidden shot and he said, I would not touch a product like this with a 10 foot pole because it’s incredible friction in the start. It’s just insane. I’m not sure it might be even easier for Drip because you can just import your list. User list provides SaaS email marketing automation, which is three times more complex than any other complex automation because you need to continuously update the information about your users in real time through the API integration. And there is no way around it because the users, they come, they go, they change plans, they do something inside their product and you send information about that into useless. 

So we then can use that data to build segments and you can build segments, workflows and do all that jazz that you came there to do. And then you need to come in and think about what you’re going to be sending and write your campaigns and set them up. There is a whole second layer to this. And I think when we were just starting out, we thought that some templates are going to cut it for the creative part and the data part. I dunno, we just didn’t think about how much work it is, which now we know that in order to successfully integrate, people don’t just need to push some events and some properties inside useless, they need a tracking plan first so that the marketer doesn’t have to go back to their engineers every month asking for new things. It needs to be somewhat wholesome to move forward. In the ideal world again, yeah, there’s a lot of steps. The integration, segmentation, creative part, setting everything up and then running day to day is another thing that they probably need to less extent.  

Rob Walling:
And that’s a ton of upfront friction as Heon said. And so you have to be, and then it’s like, well, so then you need to be able to charge a ton of money so that you can spend all this time to get people onboarded and your retention’s going to be high. But the problem is you are one of, if I were to guess 500 different email products one could use now not directly aimed at SaaS and has a functionality you do, but people start, they compare you to MailChimp or Drip or ConvertKit and they’re like, well, why are you four times the price of MailChimp? And it’s like, well, because we have all this stuff. And so it’s this constant push and pull of trying to convince people of how different and how powerful you actually are to justify any type of price discrepancy, but also not be having infinite pricing power because there are so many options that people can kind of hack and get. It’s 50, 70, 80% of the way there and they can justify it to themselves that like, well, I’m not going to pay $300 a month when I can pay 40 to MailChimp, but it’s like, ah, but it’s not going say, you know what I mean? So do you find that this, can you tell I’m speaking out of trauma because I had these conversations over and over?  

Jane Portman:
Well that verbatim, I basically wake up with this. I’m like, how do we niche down? Where is that? Is that inflection point where we finally crack this miracle puzzle of where’s that key of niching down? Because niching down as far as I see the market at the moment is the only way to move forward. It’s insane how folks that are getting billion dollar funding moving forward and they’re just doing some insane things. And that’s slightly depressing for a team of six. There is another angle to this industries that when 20 years email automation came out, it was Infusionsoft, AWeber expensive. You would use a consultant for it for a reason and you would pay much for a reason. These days you can buy whole range of pricing, you can buy a very cheap stool, but you still need to know what to do with it. And the question is, do we just leave people alone or do we really teach them to do this? And this is a very, very interesting niche because there is no university degree for email automation. So it’s not precisely marketing and not precisely engineering. It’s in the mix needs a technical mindset but also needs marketing brains behind it.  

Rob Walling:
Yeah, makes it a double whammy. So let’s dive into this. We have these four stages that you, yourself, your company has traveled on this customer success journey. You dubbed stage one, I hinted at it earlier, young and naive. Talk us through what that stage looked like.  

Jane Portman:
So what we did, we wrote a bunch of email templates, we baked them into the product so it was easy to use. And then we also, because I’m a designer, can design well, I designed a bunch of printable worksheets that people could fill out, print out, fill out and enjoy themselves. So what we did, we distributed those around throughout the channels throughout the website and we were kind of said that, yeah, look how much we’re doing. We’re awesome. We really thought so  

Rob Walling:
And you’re done. That was it. That’s the end. It’s just one stage. I was kidding. So everyone took those and filled them out and used them a hundred percent, right?  

Jane Portman:
Yeah, of course, of course. Yeah. That’s what happened. I guess we just didn’t bother that much because there were other fish to fry at the moment. We were onboarding folks mostly manually I guess at those stages. And we were just somehow stumbling forward, raising angel rounds, doing other things. Well, yeah, just moved forward.  

Rob Walling:
And here’s the way I think about this. There’s an old book by Jeffrey Moore called Crossing the Chasm, and I believe it came out in the early nineties maybe. And the book was more written for large scale adoption of think of palm pilots. Anyways, there’s five key segments that Jeffrey Moore broke this down into where you have, these are groups of customers, there’s the innovators who will use a product and they just love toying around with stuff and they’re willing to put up with a lot of pain and do a lot of work because curious and because it might provide value for them. So innovators then there’s early adopters, early majority, late majority, and the laggards, and I think what you’ve touched on because I’ve experienced this as well, is that your innovators and maybe some early adopters were fine with the young and naive face that they were cool with worksheets and templates. But those segments are very small and if you see this graph, obviously you can Google it if you’re listening to this episode, it’s like a bell curve and the innovators and early adopters are just a tiny, tiny, just not that many people. The masses are in that early majority and late majority. And so as you find that hey, a bunch of people aren’t converting, you entered stage two, which we’ve called Hire Someone. That’s a really good name. So it’s really descriptive. What do you mean hire someone? Who’d you hire? How did it work out?  

Jane Portman:
Entered 2021, I think end of 2021. We just raised our second round a little bit of money from Angels. We hired developers, we were like, we can do more. And we identified that there is this area of proactive customer success that we can tackle. And so we sat on a journey to hire such a proactive person that could be Prince Charming, talk to people, do demos and just overall communicate a bunch. And I think we circled through three candidates that didn’t work out. I’m not going to go in detail, but particularly exciting things like one of them completely lacked empathy. Someone lacked tact about giving advice to people and we are not, I’m not going to go there anyways. It’s interesting. How  

Rob Walling:
Did you hire them and hire them? They started and then you had to fire them.  

Jane Portman:
It wasn’t like a trial training period, but yeah, they were being onboarded when we learned that. And it’s interesting, I think our hiring process has improved since then, but also it was not like we had a board and all that jazz. It’s not like we hired strangers and then Michael Christoph of P GMA started our friend, he was one of the early applicants for the job and we were like, no, Michael, you’re too qualified. No you, you’re not coming in. And then I had a consultation with him and together we figured out that what we first thought should be proactive support is actually about being helpful when they have that momentum to get started during the early days. So we actually needed just plain support, just support. And that was the beginning of 2022 when we put a smart person engineer Michael in the support inbox. And that just changed our lives first because everybody should delegate support even though there is not much, it’s really frees up the hands. And second, it just gave us a whole next level of customer investigations and all these things. There is a bunch of troubleshooting that happens in email automation. So he was taking this off Benedict’s shoulders and that was really tangible. So that was nice and that worked for a while.  

Rob Walling:
So was you went to hire a customer, A CSM, we call him a customer support manager, which is an individual contributor who is going to be frankly mostly a little bit reactive but mostly proactive. And after these failed attempts, you just said, let’s just hire an engineer who can handle the support inbox. Is that the summary of it? And it worked?  

Jane Portman:
It’s not like the first role means the second role, but while we were trying to fill out the first, we learned that we actually need just someone really smart on support. And probably there is still space for going through accounts and reaching out to customers and things like that, but it’s really secondary compared to being there for onboarding.  

Rob Walling:
So that’s the difference is some people, when you say customer success, that is a lot of different things. There’s actually a lot of roles within that, right? There is onboard onboarding is only one part of that. Once people are a customer, there’s retention, there’s even instrumenting and reporting and doing analytics on onboarding. And there the amount of people who are getting onboarded, there’s a lot more to it than just onboarding. I think there’s a drinking game. I think we have six shots. I’ve said the word onboarding now six times. So it sounds like as you looked at customer success as a whole, you realize well maybe we don’t need to cover all of the bases and we should really more focus on getting people connected, getting the APIs connected and getting that early stage done such that they stick around. Am I understanding that right?  

Jane Portman:
That’s correct. And my personal, well that’s because I was kind of supervising this, but my biggest discovery is a person was that I was wrong about the skillset of such person. It’s way less about being charming. Michael is super charming by the way, but it’s less about being charming and great in camera and whatever not, but way more about technical investigation skills and that is related to our product and our niche. So maybe different for your situation. I don’t think it’s the one size fits all answer.  

Rob Walling:
So I want to touch on something you mentioned. You mentioned funding, you said raising rounds, raising angel rounds, and some folks listening to this might be thinking, oh well how much have you raised is probably the question on their mind. So first question is have you talked about it publicly? And if not, let’s give people an idea. I don’t think you’ve raised millions of dollars, right? You’re still mostly bootstrapped.  

Jane Portman:
Our second round was a little bit short of 400 K, something like this. We don’t have this. Yeah, we don’t have this number in public, but we have a nice blog post outlining the list of investors. So it was not sacred.  

Rob Walling:
Good. I just wanted to touch that so people have an idea,  

Jane Portman:
Which is not a lot of money. It is not a lot of money if you’re building something like it  

Rob Walling:
Sounds like a lot of money and it’s totally not. This is the thing, Jane, when we were building Drip, I was about 150 to 200,000 of my own money and that got us to product-market fit and then no other money raised. And this is a hard road. It was doing it on hard mode. I knew it. I was going to say in retrospect, it was doing it on hard mode. I knew it at the time, it was doing it on hard mode, but there was no avenue. This is what 20 13, 20 14, there was no TinySeed and there was no bootstrapper friendly funding. And this is before Iny vc, this is before no angels I knew would invest in a bootstrap company that didn’t want to go the venture route. So it’s nice that that is now an option for so many bootstrappers not only has the stigma, remember when Bootstrappers used to be like never raise funding. Funding is terrible, it’s so black and white. And now that stigma has been largely removed, at least in most of the circles that I run in.  

Jane Portman:
We went through the cycle very properly step by step first being brave to apply to TinySeed then oh there is nothing scary there. And then friends talked me into talking Benedict into getting more and yeah, it was not VC money but maybe with VC money you get different dynamic still to explore this.  

Rob Walling:
Yeah, for sure. Alright, so let’s enter stage three again. Stage two was hire someone stage three done for you, it’s offering done for you services. Talk through what that means and how that’s evolved.  

Jane Portman:
So in stage two, customer success engineer at that time we were really starting to build our expertise because we were onboarding users, learning about automation. We built a fabulous expert blog and then we were getting advanced into we know how it should be done well and we see nobody’s doing it well. You just keep watching people struggle and you know how to do this, but you understand that no, it’s not a way forward to try and educate them from day one. And the way forward is probably to either recommend them to hire a consultant or do it for them. And we went as hard as writing the first email saying, no, you can’t do this yourself because there is five people in the world that are professional and you’re not one of them. So either get a consultant or here’s our done for you page, which was probably a little bit too aggressive. So we don’t have that email now. And that was early 2020. What was last year? 2023 that we started on this direction and these services were surprisingly easy to sell compared to selling software. We were like, we sent an announcement and I got the first customer immediately. I was like good old consulting days when you can actually sell something quickly and make a lot of money. Well  

Rob Walling:
Yep, consulting, it’s a business code, selling dollars for hours. That’s why a lot of us start there.  

Jane Portman:
So I was executing this myself as a consultant also learning a bunch. And honestly it’s more about that joke when it’s like $1 for hitting the hammer and $9 for knowing exactly where to hit the hammer. It’s kind of that kind of work a lot. 

So it was not too bad. I served a few packages and burned out because the reason why we started SaaS was to get out of consulting people and now we are back in this. We have all the SaaS, we have the marketing machine going and services on top of that. That was really painful, but we kept offering this. It was not a huge stream. So it was a nice supplementary income, nice learning customers because when someone purchases a package, they’re pretty much guaranteed to get started and just overall good experience. So yeah, that was a netbook that allowed us to build the expertise even more because now we really did the drill for multiple companies and had feedback and implemented also actually helps to troubleshoot the tool itself quite a bit because you’re using it yourself. You’re dog fooding a bunch. It was good, it was definitely good things to do and it takes a bunch to set this up so you have to write your sales page. We also got a consultation from an email marketing consultant Summer os. She taught us her trade secrets on how to better approach the process with clients and we had these materials developed for intake questionnaires and steps and procedures and stuff. So when that was developed it was just great to have it live and going and available for customers when they need it. I guess that’s the description of this stage.  

Rob Walling:
And is this something that you would recommend to other SaaS founders if they similarly have a complex product or a powerful product that takes a lot to get onboarded? It sounds like that’s why you’re here is that folks would come sign up and then just never, you just wouldn’t retain ’em, they wouldn’t get set up and so you’re just removing one more excuse. Well I don’t have any emails and it’s like go hire a consultant. You could have a page with agency partners who do this for them.  

Jane Portman:
We haven’t  

Rob Walling:
But those agents, but people maybe don’t want to go to ’em or they’re expensive, right? Because what’s the range, the price range that you’re offering the done for you?  

Jane Portman:
Yeah, I can tell you the most popular package is the user onboarding kit includes the user onboarding campaign, like trial expire, expired trials, reactivation. So all the campaigns around activation, it’s $4,000 and consultants typically charge, I dunno, eight 12 K for the same thing up to 20 K sometimes. Depends on how much goes in this,  

Rob Walling:
Right? So you are in essence offering a deeply discounted thing that is highly repeatable for you because you already have infinite client, infinite, it’s not true, but you have a steady flow of incoming new clients. So you’re not out there really marketing it already marketing user list and it’s repeatable for you and you can offer it cheaper because you want them as a customer. You want that a CV. So it’s interesting. Would you recommend that someone else do this?  

Jane Portman:
You just sold it in five different benefits, didn’t you? So yes, of course, but also I guess it depends on what kind of lifestyle you want for yourself and the style of your business. I know some companies that were only made able to make the financials work with the services because otherwise it just didn’t take off. We know some peers who only have let’s say paid guided onboarding, which is a flavor of done for you. They have a thousand bucks set up fee, which is for bootstrap SaaS company who’s our customer, probably overkill to make it the mandatory fee, but that person I am talking about, they made it mandatory for everybody because it was pretty acceptable in the industry and they had a smashing success with it. So it depends. But at this point in my life, after seven years, I’ve really given up on trying to teach people as they get started. There is definitely a segment of bright folks who are willing to learn. It’s not impossible, but a typical busy person is not willing to absorb your information to make really qualified setup. It’s just either let them do their basic things or do it yourself really well. I guess that’s the barbell strategy of Nasim Tale. Either very simple or very complicated and expensive. The mid range is a danger zone.  

Rob Walling:
So before we move on to stage four, I want to ask you about your blog as a marketing channel. And the reason this ties in is you told me offline that as you learned more and more about the thought process and the pieces that need to go into place for all the emails that a SaaS company needs, you started the done for you offering, doing it for all of them. You started realizing, oh there’s same patterns over and over and same ideas, same thoughts. And so you took that knowledge and now you’ve written a bunch of blog posts with that knowledge of here’s how to write this sequence, here’s how to do this and make it work. And so my question for you about that is, is that working? Because it’s a lot of work, right? The done for you, you’re getting paid for, but then to take that and to write up 2000, 3000 word blog post and put it out there on Google in the age of AI where people are getting more and more answers from ai, has that effort been worth it?  

Jane Portman:
Definitely. So because just the niche of SaaS email marketing automation, thankfully with the word SaaS in it is narrow enough for us to be able to plant a footprint there. And then everybody who writes very shallow, very shallow bare bones stuff like lead the users to the aha moment. Nobody talks how to set up the triggers, how to orchestrate the journey, how to segment people really hard and a lot of others there is an endless amount of implementation details you can dive in and different ways to serve them. And going back to SEO, thankfully having the word SaaS is really helping for things like SaaS, email marketing strategy and things like that. And we also, in answering your second part, the effort, we also have two parts to this. One is big expert guides, which I write myself two, three times a year. And then we publish monthly roundups of email examples tailored to specific SaaS situations like I dunno, we just published a post today, invite your team kind of emails. 

And we have a lineup of 20 emails that companies send during their own boarding flows. Very narrow, very niche, very specifically curated and described. If you go to popular platforms like really good emails, you’re going to find 80% emails from E-commerce purely curated. So you’re not going to be able to do that. So with email examples, we kind of really hit our tried. We have a community advocate who goes around collecting examples in the communities, also distributing pieces there. So it’s a content flywheel of sorts because we’re collecting examples in exchange for backlinks from people then using these examples for SEO. And this is great material and it seems obvious maybe for Reuben but not for me. It took a few years to figure out  

Rob Walling:
Someday we all are on our own journeys Jane,  

Jane Portman:
And maybe that’s why we are still so hot on the topic. Me and Benedict, for Benedict, it’s probably never ending technical challenge. We’re never relaxing and I’m never relaxing on the educational side. It’s always how can we better explain this? How can we better teach that? What’s the easier way? You don’t want to be like Big Bang theory complicated about it. Nobody’s going to read. You want to be human about very hard topics. So how do you do that?  

Rob Walling:
And you don’t mean Big Bang theory, the sitcom, you mean the scientific principle as defined by physicists?  

Jane Portman:
Correct. I mean the sitcom, like this type of language they  

Rob Walling:
Use. I got it. The complexity. All right. Alright, so with that I do want to get into stage four, which is developing your own frameworks that you have developed out of the done for You work. Talk us through what it looks like today.  

Jane Portman:
So this year with doing more than for you projects, it was obvious that some patterns are emerging and one of the patterns was the way we use existing materials that every SaaS has and that they’re different for every business. Some startups are heavy on videos, some startups have a great blog, some startups offer 20 types of onboarding calls and just different things people have. And the way we use these materials in the process to craft actual storyboards for the campaigns and the campaigns. And we wrote a guide about it and as I was writing the guide, I knew this was a very good piece of content. I wanted to make it into a framework. I tried to find an acronym and I spent an hour. The example for this is like Pirate metrics, A RR, the company may be dead, we all know the pirate metrics. So we wanted to craft something equally timeless, but I couldn’t find an acronym and I was always stumbling on that moment. When you break down what you have into, you atomize your resources into atomic small emails. And I was like, hmm, maybe there is something about the word atomic that deserves that James Clear really likes that we can also use. 

So nothing revolutionary there and went for the name. And then now that that was done, it was a revelation that actually we also have another system for the first stage where we help our users to segment their journeys and use this as triggers and things like that. So lifecycle segmentation is something that we have been teaching for ages and now we have a framework for the creative side of things. So it’s obvious that we have system for this and system for that. So we thought, no, that’s probably called frameworks and we started using that to promote on the website. Our homepage has a section with fancy images where get started with our frameworks and basically highlights that we can help you at every step of the stage. And now this is another PR thing. We can go around customer success shows and talk about using frameworks. Hey, hey Rob, here’s how we got the placement with you. So it’s like in a rendering cycle of doing things, talking about them, meta talking about them, and then so on and so forth, which is pretty fascinating to be honest.  

Rob Walling:
Yeah, folks want to check out atomic emails. You can go to Google and just type it in. It’s look for user list.com or obviously we’ll link it up in the show notes, but it’s a very thorough and obviously very knowledgeable article written from experience. There’s a difference, you said this earlier of people are publishing content about SaaS emails and what they do is they either go to Jet GPT or Baird or they go to a freelance writer who doesn’t know anything about SaaS emails and then they do some Googling and then they research and then they put something together That is a cursory thing to try to rank. And I mean that’s not what you’ve done here. All the posts on your blog, to be honest, feel like chapters of an ebook or even a short ebook, you know what I mean? They could be combined into a pretty interesting collection challenge of course is it changes so often. 

So don’t do a book Jane, because by next year it’ll all be out of date. But that is an interesting competitive advantage that these days people are like, oh, content is dying. SEO is dying. And I don’t necessarily, everything’s sensational. I don’t necessarily agree or disagree with that. But the idea that you can’t still put out really deep, thoughtful, long form content on the internet, on a topic someone cares about and have them discover it and use it, it’s still viable today if you put in the time. But it’s hard, right? It’s a lot of work and takes a lot of knowledge.  

Jane Portman:
It’s a choice because we don’t publish anything but awesome these days. So when someone says, let’s co-market our integration, all you need is publish a blog post on your blog and we’re like, Nope, we’re not publishing a blog post on our blog for a new integration. We are only doing really cool stuff. And we also said, yeah, it’s a whole separate topic for the podcast because we went through the stage of hiring of trying to hire experts to write for us for 2000 bucks a pop. And we did a few, like 1500, $2,000. And it just, again, we stumbled into the same problem that folks are awesome in theory. And I can tell they’re not practitioners, they’re not working with real claims on this specific, well I don’t want to bring them down. They’re fantastic, but not what we’re looking for. There’s too much technical detail in this. So now we’ve settled on this combination of doing this ourselves and and using community examples for other types of posts.  

Rob Walling:
Jane Portman folks want to find you on X Twitter, you are at UI breakfast and are you on Blue Sky?  

Jane Portman:
Yep. Just joined lately.  

Rob Walling:
Alright, are you UI breakfast as well?  

Jane Portman:
Yeah, ui breakfast.com. That’s my old consulting domain.  

Rob Walling:
Amazing. Well, thanks so much for joining me today, talk about customer success.  

Jane Portman:
Exciting. Thanks for having us. Rob.  

Rob Walling:
Thanks again to Jane for joining me on the show. It’s great to have you here this weekend. Every week throughout 2024, it’s a wrap. This is a wrap on 2024. I wish you and every listener a happy new year, and I hope 2025 is shaping up to treat you really well. This is Rob Walling signing off from episode 747.

Rob Walling:
Welcome to Startups For the Rest Of Us, I’m Rob Walling. In this episode, I talk through my nine startup predictions for 2025. I’m recording this in mid-January of 2024, and I like to take a bit of time each year to think about how I think the landscape might change in the coming year. And frankly, most of these are around SaaS, but there are a few that aren’t directly going to impact SaaS. And so I just said startup predictions in the title and predictions are really tough. If you’re actually looking ahead and trying to forecast things, no one knows what’s going to happen. So take these with a grain of salt. There’s at least one of them that I kind of hope doesn’t happen for the sake of all the startup founders that I am rooting for, but nonetheless, if I think there’s a good chance it’ll happen, I want to include it in this episode. 

Last episode, I went through my predictions for 2024, and you probably noticed, I think maybe I had what a 30 or 40% hit rate 50% at best. So keep that in mind when you hit predictions for me or anyone else that at best we’re going to be as good as maybe a coin toss. Before I dive into the predictions, if you missed backing the Kickstarter for my new book co-written with Dr. Sherry Walling, it’s called Exit Strategy. The Entrepreneur’s Guide to Selling Your Business Without Regret. You can now buy it on pre-order in paperback form. So the Kickstarter was for hardcover, but if you go to exit strategy book.com, you can either order an electronic copy or a paperback copy, and you’ll get that in a few months once everything is ready. So if you missed it, exit strategy book.com. And with that, let’s dive in to my first prediction. 

I’m going to go through three of them as a group because of these three I made for 2024, and I’m just carrying ’em through and I realize that’s kind of cheating. So I’m kind of combining these all into one. My first is that Twitter will change hands in 2025. I think either the debt’s going to be called due, someone’s going to do a hostile takeover. The valuation is so low. I just think it is inevitable that Twitter will change hands here at some point. And so I’m calling my shot like Babe Ruth, and I’m saying 2025. My second prediction is that no code and low code will get unit tests and version control. So in 2024, I predicted it would be professionalized and I put that in quotes, and then I did a text expander on professionalizing kind of defined what I meant by that. 

Realistically, the fact that no code and low code don’t really have unit tests and version control at this point, as far as I know, the tools we use, the airts, the bubbles, the softers, the Zapier stuff gets pretty brittle. And it reminds me of how we coded in say the late nineties or the early two thousands. And I do think it will evolve. So unit test and version control coming for no code and low code, and I do think there’s opportunity there for startup founders. My third prediction carried over from last year is that Stripe will go public in 2025. Not much more to add to that one. So my fourth prediction for 2025 and the first new one is that search volume for Google Organic SEO. And I’m talking about content-based keyword targeting where you’re cranking out an essay, an ultimate guide, a blog post. 

I think they will slide across the board by at least 15% in 2025, specifically as they give way to AI searches. Now, realistically, when I first wrote this down, I put 25% and I thought that might be too much, but I think there’s a real chance it can be between 15 and 25% specifically due to AI searches. And the reason I’ve said specifically due to AI searches three times now is because Google has messed around with their search engine results for what the past decade in terms of making ads at the top look like organic results, and then just bumping the organic results further and further down the page to the point where if you’re searching on a lot of laptops, you don’t even see organic results above the fold. That’s not what I’m talking about. I think Google will continue to pull shenanigans with that, but the number of times now that I do searches in Google and the AI answers it quite accurately and cites sources is just shocking. 

And so this zero click trend that a lot of folks ran Fishkin over at Spark Toro I’ve been talking about, but a lot of other folks as well, it used to be that it was a little box with a summary. What’s the weather like? And it just had the weather at the top instead of linking you to weather.com like it would’ve done 10, 15 years ago. But now AI is doing that. And now AI answers pretty complex questions. In fact, in preparation for this episode, I have a prediction later about self-driving cars, self-driving taxis. And I had remembered that people have projected how many traffic deaths can potentially be avoided around the world if everybody used self-driving cars. But I couldn’t remember what the percentage was. Is it down 90? Is it 95, is it 98? And so I typed that into Google and the AI at the top had excellent results. 

I think it said between 90 and 94% of the projections, and these are the different sources and blah, blah, blah. And it just summarized everything. I didn’t have to click anything. So that’s just one example. But I find that being more and more common and what used to happen is I would Google it, I’d see the AI result, and I would question the AI result. Is this legit? Because AI can hallucinate as we know, but they are citing sources and you can see the sentence from the source. So things are going to get dicey. It’s going to be interesting to watch as search engine clickthroughs drop significantly in the coming years. And if you look back, Ruben Gomez and I had a conversation about this three or four months ago, you can search for his name at startups For the Rest Of Us dot com to listen to that episode where we talk through organic SEO and his company. 

Sewell relies a lot on organic SEO, but you’ll hear his perspective on it. It is very much facing the present reality, but also there are ways around this content-based keyword targeting is only one way to do SEO and Google. What are the other ways that maybe won’t be impacted by ai? And this among all the other predictions is the one that I don’t want it to happen because guess how many startups I’m invested in? I advise or I’m rooting for that rely on content-based keyword targeting. There’s a lot of them, but we do have to face the current reality when we are building our companies. My fifth prediction is that ads in AI chat interfaces like chat GPT or Claude or whatever other chat interface you use will become commonplace because this is the next frontier. As eyeballs move from clicking on the 10 blue links on the Google search engine result page, it’s natural that these free interfaces have to make some type of money. 

They have to start monetizing at some point. And so they’re going to be toying around with different types of ads and I don’t know if they’ll look like AdWords or not. Will they be display ads? Will they be text ads? Will they be a video popup? Will they be just a sentence embedded in the AI’s thing of like, Hey, if you like this, maybe if you searched for this, maybe you want to buy a self-driving taxi. That doesn’t actually make a lot of sense, but you get the idea. It can be interwoven into the message. There’s a lot of creative approaches to this. I think IT companies will overdo it. It’ll be super annoying because marketers ruin everything and monetization ruins everything. But my prediction is that we will, I know we’re already seeing a little bit, I think there’s one company right now that’s testing ads in their AI interface as I’m recording this, but it will become, dare I say, almost ubiquitous one year from now, my sixth prediction, another, there’s two more related to ai. 

And look, I’m sorry, I’m not like a big AI proponent or opponent. I think it is just shifting the landscape of everything and the fact that Google’s 10 blue links are being disrupted shows you what a monumental shift across the entire tech community and the startup community and frankly the world. It reminds you of how big of a shift it is. So my sixth prediction is that Google will see its biggest ever drop in revenue due to the transition from 10 blue links being the prominent way people search into AI ads. And I think Google’s going to have a bit of time that they’re going to need to figure it out because realistically, it’s some astronomical number, and I should probably go to Jet GPT or Claude and ask this, but I think it’s something like 95% of Google. I say Google, it’s Alphabet is the parent company. 

90 to 95% of alphabet’s revenue comes basically from online advertising. And this AI phase shift, this huge transition is going to disrupt that and figure it out eventually, I think. But I don’t think it will happen without some type of drop. And Google really hasn’t seen any major drops in revenue from what I can recall over the past 25 or whatever years. So that is my prediction number six. And I want to just pipe in here. I don’t want to pipe in before my seventh prediction. As you listen to these, think about where the opportunity is going to be for Bootstrap startups and as we see shifts and new tools arise, like let’s say they do have ads in AI chat interfaces, well, they’re going to have to have an ad management tool for that that they will build. They being who chat, GPT, Claude, whoever. 

Usually those are not going to be very good at the start. So if they have an API, is there a way to build a third party tool that can manage the ads better? This is what TinySeed company Link Low has done for LinkedIn ads. It’s link low, do io. If you are using LinkedIn’s built, built-in ad interface, you know how painful it can be, and Link Low helps make that a lot better. So is there an equivalent for these other new ad interfaces that are going to be created? That’s just one idea. One example I think of as I look through these predictions, my seventh prediction is that the term AI will be used in fewer H ones than it is today, especially across startups because AI will just be assumed. It will just be the norm, it will be the default. You will assume AI is in every product that you log into in every SaaS app that you use as it becomes ubiquitous. 

I think back to maybe 2005 on the internet when as SaaS companies, they weren’t called SaaS back then. They were called software, web software, web-based software or a SP application service providers. As those became more prominent, they literally would have statements on their homepage, you don’t need to operate a server to use our software. It’s not client server access from any internet browser and also entering your credit card is safe and secure, all this stuff. That was such a paradigm shift to get people to try to get their head around it. Well, it’s like, well, I don’t need a server. How do I do it? And there would literally be FAQs of, well, you just log in here in the web browser and you use the software and you had to explain that to people. And these days it’s like, well, it’s AI for this and it’s your AI assistant and it’s your AI. 

That I think, I mean I guess if it’s an AI assistant that’ll stick around, but I do think there’s going to be a new term that comes around because AI means too many things right now. And I almost wish the term virtual assistant that came to mean someone who was remote, right? It’s like, oh, back in the four hour workweek days of, I don’t remember when that was, oh eight or oh nine, virtual assistant came to me. Oh, I have someone in the Philippines or in APAC or in just an inexpensive region and really virtual, I don’t know. I wish that term hadn’t already been co-opted for that because AI means too many things and I think there will be terms that splinter off of this to better describe what they actually are. But all that said, my prediction is not that I’m digressing, I am predicting that the term AI will be used in fewer H ones one year from now because it will just be assumed that AI is built into everything. 

Now in the near term, I think the number of applicants two TinySeed and two Y Combinator that include the term AI will stay the same. Hopefully it doesn’t go up. I mean, I think the number of companies or the percentage of companies accepted into Y Combinator that say they use some form of ai, it was like in the most recent batch was 85 or 90%. It was some astronomical number TinySeed that much, but it was definitely, if I were to just ballpark it, maybe 40 or 50% in our most recent batch. I’m not sure it’s that high, but you get the idea, which is very much up from zero. No, we actually had, I think we had maybe 5% two years ago, three years ago before chat GPT, it was kind of one in each batch was using AI to do something. And then it has slowly slash quickly ticked up to where we got a lot of applicants. 

The problem with a lot of the AI tools that applied to TinySeed is they have this super sharp growth curve and crazy high churn. And so you can’t outrun that kind of churn, 15, 20, 20 5% churn. And I just think a lot of them are catching a temporary wave and there’s opportunity there in the short term. But to build a long-term sustainable business to make it that long, most of them will not. And it’s the same thing you see on X Twitter or blue sky folks launching and like, Ooh, ai, look at this growth. And then yeah, a few months later, the Hubbubs died down and you don’t hear from them anymore, and then you see it for sale on a choir for a fraction of what you think it would be worth. And so there are very, very few, I’m not saying there’s zero, there are very few that are AI rappers chat GPT rappers that will be around for years. 

My eighth prediction is one I referenced earlier. It’s about self-driving taxis specifically, and the prediction is that self-driving taxis are legit and anywhere that allows them to operate will quickly see them become the norm. I’m speaking from firsthand experience having been to Scottsdale, Arizona, flying to Phoenix, Scottsdale’s right there butted up against it. And I saw ads for Waymo self-driving taxis in the airport, but of course I have Lyft and Uber, and so I used one of those apps to get to the hotel. But then a friend of mine who lives in Phoenix said, while you’re here, you have to try the Waymo’s. He said, it’s all I take now. So download the app and try it. And I did, and Sherry and I rode around in a car with no driver and the steering wheel moves and it takes up one trip. It took me one trip to get used to. 

It is a super interesting experience to be in there. And you have full control of the climate, so you can make a hotter, colder, you have control of the music, you could feasibly pair your phone, but it was kind of a complicated thing for music. But they had playlists. Of course, it was a bunch of Christmas direct because it was late November. But after doing that, I was struck by just how pleasant the experience was and the fact that self-driving cars are so much safer than human-driven cars is just incredible. And again, referencing earlier in this episode, I went to Google and asked how many traffic deaths, not just accidents but deaths, do we estimate will we reduced by these self-driving cars? And the numbers that quoted were between 90 and 94%. So in the United States for example, there’s somewhere around 50,000 traffic related deaths every year. 

And a lot of those are from people who it’s driver error, it’s humans being tired, being drunk, being high, making mistakes, unable to see in certain conditions where an autonomous car can see through the rain or whatever. And humans might have difficulty or darkness. And so even if we take the low number of 90%, instead of 50,000 people dying each year, you’re going to have 5,000. It’s an estimate, but even if they’re off by factor of two, it’s just shocking. It’s shocking. And I know there’s a whole conversation just like ai, there’s a whole conversation around jobs, and I get it, and I am totally open to having that conversation, not going to have it in this episode. It is much like self-checkout and much like robot manufacturing, instead of humans putting a rivet in something, robots doing it in a Toyota plant, there’s whole societal impacts that we have to deal with. 

But put all that aside for this podcast, talking about startups, self-driving taxis are a thing. And if they came here to where I live in Minneapolis, a hundred percent, I would be willing to take them. And in fact, late nights when sometimes I’m concerned that my driver is super tired or the driver might be drunk, I would want a self-driving taxi. And here’s the other thing, I have two teenagers and at times there’s Uber for teens, where as the parent you kind of monitor what’s happening. And so they can call a car, it tells you your child called a car to this location, and they try to give you the highest rated driver, like only 4.9 and up, and they take a bunch of safety precautions. I think they have background checks or whatever. I’m guessing they get more. It’s the premium drivers, it’s a premium service, and then you can see the car the whole time and then you get notified when they get dropped off. 

But wouldn’t that be even better if it was self-driving? Like the risk of someone doing something that you don’t want to happen goes away because it is a self-driving car that pulls up and they get in and it’s just incredible. Now, do I wish that mass transit was a thing? Yes. Do I wish in more US cities, it was just buses and trains in a lot of European cities that I visited, of course, again, it’s a conversation we can have about how society, how America developed around cars and on and on and on. But self-driving cars are legit. Self-driving taxis specifically are amazing. And then what I’m thinking is my brother lives in the Bay area of California and he has this massive commute traffic’s so bad, and as a result, he bought a Tesla purely for the self-driving because he spends so much time in the car each day, like 90 minute commute each way. 

Think about it like that. And it allows him to be more present with other things rather than sitting there pushing a gas pedal. But when to true self-driving cars change the game, not just taxis, but my brother could drive and not even need to sit behind the wheel anymore because that’s what Sherry and I were doing in Phoenix. We were in the backseat as the car drove itself. And non taxis meaning just commuter cars that people are driving day to day don’t have that yet. And so when that clicks, how many of those are going to be sold and how many cars on the road will become self-driving? It’s going to be a lot. And I don’t know if 2025 is going to be the year of it, but I think regulation is a big part of what holds this back. And of course, there are also driving conditions like all the testing is being done. 

It’s usually in on the west coast or the Southwest. It’s not done in the snow, so it may be a very long time until we see them in rougher climates. My ninth prediction is that platform risk will intensify in 2025. There are more platforms to build on. There are larger, more monopolistic platforms that exist. The Shopifys, the Facebooks, the Reddits, and I think bootstrap founders will face increased challenges with platform dependence. And if you listen back to episode 735 of this very podcast, just not even 15 episodes ago, the eight levels of SaaS platform risk, where I talk about the three key factors within platform risk replacement, customer concentration, and lead flow, you will hear that it’s not just one or zero, it’s not just on or off. But I have eight levels where I talk about almost no platform risk relying on a commoditized platform all the way up to aggressive platforms, few replacements, and you have high customer concentration. 

So what does this mean for entrepreneurs? Well be aware of platform risk, be aware of the types of it, the dangers of it. Know what you are getting into. It’s not to say you should never build on a platform. I think step one and step two businesses can be incredible opportunities for entrepreneurs. As long as you’re aware of what you’re getting into. I would not want to build a 10 year business on any of these platforms. They do not give a shit about you, and they will sooner cut off your API access, say, oops, killed your business. They will build the feature directly into their platform. Oops, killed your business. They don’t care. They’re like Honey badger. They do not care. So know what you’re getting into. If I were starting out trying to get my first app or first couple apps trying to quit the day job, I am all for platforms because I think platforms lend. 

It’s all the reasons the stair-step method exists. But if I were looking to build my next app to seven or eight figures, I would think long and hard about whether or not I wanted to be on a platform that could take over the whole business, could kill it. Now, realistically, the hard part is this changes because WordPress, I feel like has always been a pretty friendly platform until this year when Matt Mullenweg’s slash WordPress made the decision to be very aggressive with WP Engine and apparently take over plugins. I mean, there’s a whole story there that I’m not going to cover here, but realize that platform risk exists in a lot of places, but it doesn’t exist everywhere in the same level. And you will want to educate yourself, know what you’re getting into as we head into 2025. So thanks so much for joining me today to hear my nine startup predictions for 2025. Some of them are positive, some of them are downright gloomy, but I did want to share these with you as I’ve been thinking about ’em. Thanks for joining me this week and every week. This is Rob Walling signing off from episode 746.

Rob Walling:
Welcome back to another episode of Startups. For the Rest Of Us, I am Rob Walling, and in this solo adventure, I’m going to look back at 2024. I’m going to reflect on some key concepts that I discovered slash introduced on this podcast in the last 12 months. I’m going to reflect on accomplishments, things I was able to ship this year, as well as look back at my top four favorite episodes from the year. And then I’m going to revisit the predictions that I made for 2024 because with only, I’m recording this a few weeks in advance of it going live, but there’s only a couple of weeks left in 2024, and some of these have come to pass and some have not. Before I dive into the episode, I want to let you know about my course that’s SaaS Launchpad, but not just the course because I’ve talked about it on this show before, but the fact that we have added a free sample, a free trial of the course, it’s one of the 27 26 videos that are included in this course. 

Total course is about nine and a half hours of content, and this is 28 minutes long. It’s called the DNA of a great SaaS idea. It’s kind of my response to the question, if you could design the ideal SaaS product for a bootstrapper, what would be all the aspects that you would want from it? What elements would it have? And I think I came up with 17 or 18 different factors, and realistically, I don’t know that if there’s a single idea that has all 18, but it’s things to think about as you are evaluating your SaaS ideas. So SaaS launchpad.co, if you click the start free button, you will be able to download that video and check out what the course is all about, SaaS launchpad.co. 

As I’ve recorded this podcast over the years up to almost episode 750 in the course of almost 15 years, I like to reflect every so often, and sometimes it’s in episodes where the episode number ends in two zeros or maybe ends in 50, and other times it’s at the start or the end of a year. So in this episode, I did a quick, it was frankly a cursory look back through the past 12 months, so almost 52 episodes as well as I skimmed through the YouTube channel, although that was even more cursory. And I came up with four concepts that I introduced in 2024 frameworks or concepts. Now, obviously there’s a lot more in the solo episodes where I talk about a herd of bison walking into a storm or normalizing doing hard things. I don’t consider those concepts. Those are just maybe motivational things that come along now and again to give you some inspiration. 

But when I talk about frameworks or concepts, I mean things like in episode 706 where I introduced the 2 2200 validation framework, and that’s a novel approach to thinking about ways to validate an idea where the two is two hours, that’s where you do some keyword research and go online and look at forums, do whatever else you can do online. The 20 is 20 hours, that’s when you start talking to customers or building a landing page and sending traffic. And the 200 is usually where you get in and build some type of MVP. So the 2 2200 validation framework was introduced just 39 short episodes ago in episode 7 0 6. Another concept that I stumbled upon. And usually what happens is I’m observing all these companies that I’m either advising or invested in or just in the broader MicroConf startup For the Rest Of Us TinySeed community. And I start to see patterns and I’m trying to figure out a way to describe those. 

And oftentimes it comes when I’m coming to a conclusion and I realize there’s an edge case that isn’t defined. So the second concept of the four that I’ll mention today was when I was looking at horizontal and vertical SaaS, I was trying to evaluate the growth and the difference in growth between the two categories across the tiny C portfolio of now I believe it’s 192 companies. And I realized there was a third type that kind of didn’t fit into either or. It kind of fits into both. And I was trying to think of a good name for it. And I came up with orthogonal SaaS. And so this is where you have a horizontal product, meaning it can be used across any type of business. So it’s not vertical, right? It’s not in a specific niche, but it is aimed at a single job title or a single role at a company. 

And so I went with all the clunky things like role-based SaaS and title Focus, all these dumb names, and talked about the chat GPT for way too long. And eventually I liked horizontal, vertical and orthogonal. It matches up. And actually, if I drew a diagram, we’re at a whiteboard right now. I could point out to you why it makes sense that it’s orthogonal, but realistically trying to do that a podcast would be terrible radio. So Orthogonal SaaS was the second concept I introduced in 2024. The third one was in episode 735 where I got really fired up about this eight levels of platform risk. And this is absolutely one of my favorite episodes of this year. I was reading X Twitter and I was listening to a podcast, and I get so fucking tired of people saying, well, every business has platform risk because that acts like platform Risk exists or it doesn’t, that it’s a one or a zero that much people think product-market fit is a one or a zero, that it’s on or off. 

People think platform risk is on or off. And usually this is from someone who’s, it’s often like a no-code proponent, and I’m totally cool with no-code, but realize the pros and cons of no-code. And one of the big cons is platform risk. So when people point that out, the no-code folks bristle and say, well, everything has platform risk because built on AWS, and that’s platform too. But no, no, no, it’s definitely a gradient. It is a spectrum. It is a continuum. And so I sat down and came up with a whole framework around this, and I got seven levels of platform risk. And then WordPress and Matt Mullenweg started to implode and I realized, aha, I think there’s an eighth level of platform risk. So it was a last minute I called an audible and for those familiar with American football terms, and I added an eighth level right before recording it. 

So I really enjoyed this episode because it was something that seemed to really resonate with people. And I’ve already used it in a few conversations, especially on X Twitter, letting people know that, hey, it’s not binary and trying to put some shape to this because if we don’t talk about it in these detailed terms and isn’t platform risk just this amorphous kind of cloud that you can float through and it’s like, ah, maybe I platform is maybe an owner. Everyone does. So why even think about it? And it’s like because it can kill your business. And I think thinking about it at a deeper level than just saying, oh, it exists or it doesn’t. Really, really helpful for all entrepreneurs and frankly, especially for SaaS founders, as you’ve probably heard me say, my mission in life, the legacy that I will leave behind when I’m no longer here is to multiply the world’s population of independent self-sustaining startups and things like the eight levels of platform risk and the three factors, I think I had three axes that I use to kind of frame that conversation and framework. 

This is one of those that I think will stick around for years to come because guaranteed to put it into a future book. And then the fourth concept that I introduced in 2024, this one has a question mark. I may have introduced it. 2023 is the 1 9 90 rule. And this is the idea that not everyone should raise venture. Not only should not everyone raise it, but I only think about 1% of venture eligible tech startups should raise venture. I think 1% approximately should consider raising venture. I think 9% should consider raising some type of funding, whether that’s angel investment, something independent funding like TinySeed or Indie vc. And then I think about 90% of those companies should bootstrap. So the 1 9 90 rule is something, again, I may have coined it in 2023, but I know I presented on the podcast in 2024, and it’s something that I similarly think will stick around for years to come. 

I have a feeling there are a few more concepts I did after I wrote the SaaS playbook, a lot of kind of got my juices flown, and I started discovering slash noticing more frameworks and concepts in late 2023. And then throughout this year, I can almost guarantee you there are more that I have missed. If you think of one, email me questions at startup For the Rest Of Us dot com, I’d love to include it in a future episode. Next, I want to talk about my four favorite episodes, actually five favorite because one of them already mentioned, which was the eight levels of platform risk. That was episode 7 35. Another one of my favorites was 7 28, which is where I talked to Iran Galper and the founder of Gym Desk about his exit. He exited, bootstrapped, took very small amount of money from TinySeed and then exited for more than $32.5 million. 

An incredible, incredible success story for both Iran and frankly for TinySeed. Next episode is 7 0 6 0.5, where I rethought my most common startup advice. So that was the April Fool’s episode. And decide from you grumpy curmudgeons out there who hate fun and don’t like April Fools. Actually don’t like April Fools either. So I’m trolling you. That episode received the most feedback. I believe of any episode ever in the history of this podcast. Absolutely received the most feedback of any episode last year, but I’m pretty sure of all times. So let’s just plan on doing an April Fool’s episode every year, shall I don’t think I’m going to do that, but I’ll keep you guessing. Next episode, one of my favorites of the year, 729, 9 things I learned investing in more than 190 SaaS companies. I just episodes like this that can present findings or thoughts or patterns that are based on, I guess a unique viewpoint, right? 

It’s like how many people, I’m actually up to 212 SaaS companies bootstrap, mostly bootstrap SaaS companies that I’m invested in, and there just aren’t that many folks thinking about it like that. And certainly not folks thinking about it in terms of being capital efficient and independent SaaS or being mostly bootstrapped. And so I have more than nine patterns, actually. Yeah, nine things I learned. I think I had another six or seven over on the YouTube channel, so there were probably 15 or 16 that I presented, and of course the list goes on, but I enjoyed that episode. It gave me a chance to sit and reflect on those findings and to try to pull things out that you can’t get out of chat GPT, you can’t get off the internet, you can’t Google this to learn it, right? It’s like things that I’m learning, being in the trenches, doing something that’s a relatively unique experience and a unique viewpoint. 

And I think that episode turned out great. I actually got a lot of positive feedback about that. And then the fifth and final episode of my favorites of the year is 7 0 9, the seven greatest investments of my life where I talked about from top to bottom, top being the most money I’ve made from any investment, which is selling startups all the way down the list, including crypto, investing in startups, et cetera, et cetera. And kind of took some lessons away from that, but it was something that people said resonated with them so they could hear and get a sanity check because salaried employment was number, I don’t even remember, number six maybe, and running and operating profitable companies was in there, number five, maybe it was a fun episode for me to walk down memory lane, but also something that I think could potentially be helpful to people. 

So it was one of my top fives of the year. So now I want to reflect a bit on 2024, and then I’m going to look at those predictions that I made. I don’t think I did very well with these predictions. I’m going to look at ’em on the spot. I have not prepared, not prepared. So I better be prepared to probably get two out of seven or something. I dunno how many I made in total, but I want to look back in 2024. And the first thing I want to talk about is how entering 2024, I recorded an episode about how I was basically experiencing burnout, and I took three weeks off at the start of the year, something like that. It was like two to four weeks off to get around the burnout. And also we decided not to do any MicroConf locals. 

So my travel schedule was cut in half, and I was basically kind of at the edge of I don’t know that I can keep doing any of this. At the end of 2024, it was really fall through, it was through December, and you’re burning out when you start questioning everything you’re doing, and do I even want to be a startup founder anymore? Do I even want to do any of this entrepreneur stuff anymore? And that’s when I know I need to take a step back and recharge and take some time off and kind of clear the head. So that’s where I found myself. I adjusted my travel schedule and the amount of travel reduced it dramatically, probably cut out 75% of my travel. And then I asked myself, what are the things that give me life during the year? And all of this worked. I got through burnout when I came back in January from that four weeks off, two to three weeks, I actually don’t remember how long it was, but I did feel recharged and then I didn’t go back to the grind. 

I think within a few months of that actually, we went down from one YouTube video per week to one every other week, so it cut that delivery in half, and that was also more of the grindy part of my job. So releasing this podcast, it rarely, rarely feels like work. It’s something I thoroughly enjoy. It’s a creative outlet for me, and I’ve been doing it for almost 15 years now. YouTube is a little bit different. It’s more of a grind, not all the time, but it’s definitely, it feels like work a lot of the time. And so a video every week was taxing. In addition, the channel, the growth really slowed down. We kind of tapped out most of the market, not all of it. We’re at about 91,000 subscribers now, but we plateaued around 80,000, I think it was within a month or two of that January sabbatical, in essence, sabbatical, two to three weeks, no sabbatical, but two to three weeks off that we did decide, Hey, shipping one a week, just it isn’t worth the effort, the time and the money. 

And so we backed off on that and I think that also thoroughly contributed to helping me get through burnout in 2024. A couple things we shipped from MicroConf this year were MicroConf US in Atlanta. We had Ben Chestnut and Rand Fishkin were there. It was a great, great event. We did MicroConf Europe and Dubrovnik. Both of those events sold out. Europe sold out relatively quickly and was, I believe it was either the best or definitely top two or three best MicroConf Europes that we’ve produced for a number of reasons. The attendees were amazing. The talks just everything came together. The execution was outstanding. So I’m thoroughly looking forward to those two events this year. Well, I guess in 2025, we have New Orleans happening in March. You want to get tickets that it’s approaching sellout at this point, and that is microcomp.com/us and then Europe is yet to be announced also with MicroConf, we launched the State of Independence SaaS report in, I believe it was May or June, and we launched my course, the SaaS Launchpad. 

I talked about it in episode 730, but I just talked about it at the top of the episode as well. But what an effort. You figure you can record a course in a couple months and get it out, and it was like nine months of a lot of work, and as a result, the quality of that product is outstanding. So it is by far the best course I have ever produced. I’m super proud of it and I’m glad we were able to get it out. A couple more things, the SaaS Playbook, which I did a Kickstarter for, and then shipped the book and started selling it widely in, what was that, June or July of 2023. It has continued to sell very briskly and it caught in past to start small, stay small within a year, something like that. Start small, stay small, has been around for 14 years and sold about. 

My best approximation is 30,000 copies and the SaaS Playbook hit 30,000 copies in about a year, and it still continues to sell. I haven’t run the numbers in a few months, but it’s got to be at 32,000, 33,000 copies for a self-published book. That’s not bad, given that I keep so much of the revenue. If you buy directly, I keep 97% because Stripe takes some. Amazon is, I think a 70 30 split. Is that right? And then Audible takes 75%. Don’t get me started on Audible, but all that said, yeah, if you’re going to buy the audit book, buy from me directly and get the DRM free MP threes. But anyway, the SaaS playbook has continued to sell well and was a highlight of my 2024 to hit those milestones. And again, to see it hit the hands of so many people. The podcast on YouTube are free. 

Things that I’m able to put in the world, obviously funded by all the other stuff I’m doing. The Things we sell at MicroConf, the book is very close to free like Kindle or PDF. Go to SaaS playbook.com. You get a DM free pdf. It is 10 bucks and the paperback copy, I think it’s 25 or 30 on Amazon, the audio book is 12 or $13 on Audible, so it is not totally free, but it is approximately free. And given my mission to multiply the world’s population of independent self-sustaining startups, it feels to me and kind of always has felt this way to me, that writing books is one of the best ways to do that. And that getting a book in someone’s hand, even if it contains some information I’ve already talked about, even if people don’t read the entire book, it just codifies things in a different way than a podcast or a YouTube channel can or pontificating things on social media. 

I really do see and think books Move the Needle. I know that books have moved the needle for me in my entrepreneurial journey, and I hope that they do for you as well. If you did buy SaaS Playbook or Start Small, stay Small. Speaking of books, my Kickstarter for Exit Strategy, the Entrepreneur’s Guide to Selling Your Business Without Regret ended just a couple weeks ago. As of this episode going live, it successfully funded. I’m recording it before the end of the Kickstarter, but I do know that we have hit the goal. My best estimate, you can go check this because you’re living in the future. My best estimate is it did in maybe to 30,000, 35,000 in that range, which is a third, about a third of what the SaaS Playbook did, which I think I’m both surprised by and not surprised by it. I thought it would do a bit more, but I knew it wouldn’t do as much as the SaaS Playbook. 

SaaS Playbook is obviously just so much more broadly applicable. SaaS playbook’s also the first book that I have written and released in more than a decade with exit strategy coming basically 18 months later, I figure people are like, Ooh, man, can I really do I really want to read another book by Rob Walling? But anyways, exit Strategy Kickstarter, I am very excited about that book. We’re doing a hardcover print run that’ll be out launching to the broader world here in February, I think, or maybe March at the latest of 2025. And I am excited to see what that book does in the long run. It is an evergreen book, the Can Sell for years and years and years, and I do think it’s going to be one of those like start small, stay small and SaaS playbook that has staying power. As I already said, in 2024, I invested in my 212th SaaS company and looking ahead to 2025 TinySeed tails. 

People have been asking me, is Tiny Sea Tales coming back? Season five and six are both being recorded, five is almost done. There was a reset. Someone had to start over completely. They lost a co-founder. They had to start over with a brand new idea, and so it just reset the clock. So there was no story arc and I didn’t want to end it with a question mark. And so we’ve just kind of waited and waited and recorded less frequently in order to make, I believe we’ll have nine episodes in Tiny Sea Tale Season five, but we are recording episode nine. Well, it may already be recorded by the time you hear this, and I think we will be pushing that out weekly on this podcast feed as we typically do on Thursday. So you get a bonus episode each week. And it’s cool because it’s heavily edited. 

It’s got voiceovers for me and it has the music telling the story, and it’s, I think in this case it might be an 18 month journey told over the course of 9 25 minute episodes. It’s a neat kind of NPR Gimlet media type production. At least that’s what we aspire to within time constraints and budget constraints. And that will be coming out here in probably January or February of 2025. And then season six is in the works. And so who knows? I don’t like to promise that, but maybe the fall of 25 if we get it done. Alright, so last thing for this episode, and I’m going to say stick around till next week because I’m going to talk about my predictions for 2025, but as we wrap this episode, I want to revisit the predictions I made for 2024. The first is I commented that there would be opportunity in vertical SaaS and I would say, ding, ding, ding. 

Heck yes. I’m still seeing that the companies were funding with TinySeed, the folks I’m seeing in Microcom succeeding. Obviously you can still succeed with horizontal and orthogonal SaaS. Vertical SaaS is a great place to be if you are a bootstrapped or mostly bootstrap founder. The second prediction was that SaaS will continue to grow in emerging markets. I’m going to give myself a win on that. Similar, the application volume at TinySeed of emerging Markets SaaS and seeing the ones that we have funded in Latin America that are focused on the Latin American market or other emerging markets like India, et cetera. They have some unique headwinds in terms of pricing. They have unique advantages in terms of how cheap it is to market in those spaces. So giving myself a win here, SaaS will continue to grow in emerging markets, and I’m seeing it this year and probably just predict it for 2025. 

It doesn’t count. I can’t keep predicting it if it already happened. My third prediction was that Twitter would change hands in 2024. Obviously not. That’s a fail unless it happens in the next two weeks before this episode goes live. My prediction is a big fat zero goose egg. I’m going to roll this one forward. Usually I predict things about two, three or four years before they actually happened. When I ran back through all the predictions since we started, which I think was 2012 or 13, which was the first year we did them, a lot of times the prediction that I made would come true two or three years later. So it was early, and I think that’s the case here. Twitter changes hands in 2024. No, it did not. That is a fail, but I think it will be true here coming up. My fourth prediction was that subscription fatigue will have little impact on the adoption of B2B SaaS. 

I’m going to give myself a half point on this one. B2B SaaS is starting to see headwinds. I think it’s because of the economy, the uncertainty of the recent election of the fears of a recession. I think subscription fatigue maybe. So that’s why I’m giving myself a half. I guess I am kind of inconclusive on this one. So half point, my fifth prediction was that no code and low code will undergo professionalization, meaning things like source control, version control. We could roll things back and forward better debugging unit tests, and that is a fail. This is something that I do think is going to happen eventually. I just think I’m early. I want this to happen. I want no-code and low-code to be more manageable. And back in the day, 20 years ago when we were writing code code and we didn’t, a lot of us didn’t use version control and we didn’t write unit tests. 

It’s just we still got it done, but it makes it brittle. It makes it harder to maintain. That’s where I think no code and low code are heading. And I think there are some very interesting opportunities in the professionalization of no-code and low-code. My fifth prediction was about AI and about whether it was just hype or not, because people were saying, do you even still use chat GPT anymore? AI is going to take all the developer jobs and folks even saying it was kind of a fad. So I said, no, it’s going to stick around. It is going to become ubiquitous. It’s going to continue to improve productivity. I said, AI is not going to take a bunch of developer jobs, and I don’t think that it has. I said, AI is going to continue to help devs build faster. And this was before Cursor came out, ding ding, like yes, yes, I talked about there would be real productivity gains from ai, not just for devs. 

I think that’s certainly been true on my team and word on the street is other folks are experiencing that. So I would say it was right on this one, although I kind of baked a bunch of predictions into this one just about AI in general. I just gave my thoughts of where it was headed. And so there wasn’t a concrete thing aside from things I’ve just read off to you. One of the things I said is that non-obvious AI apps will start to come out. The obvious AI things are, hey, describe something in habit, create an image or a video. And I was figuring that more non-obvious, less obvious AI apps would start to get built as the obvious ones all kind of got scooped up. And if I’m being honest, I don’t think that that happened. So this is where I kind of like, I don’t know. 

Do I get three quarters of a point? I think I was mostly right on this prediction that I am bullish on AI on the fact that it’s going to help us all be more productive, that I think it’s going to stick around and is not a fad, and that I think it will help devs build faster, which won’t necessarily remove dev jobs. It’ll just help us build more software because man, we have a need to build software faster. Or what my last prediction was, I think Stripe will go public in 2024, and that did not happen. That is a goose egg. This is one of those I’m going to roll in 2025. It’s inevitable. And eventually, you know what a stopped clock is, right? Twice a day, and I think stripe’s going to go public soon. And so I will take a goose egg for 2024, and likely you’ll hear this again In next week’s episode. I want to give you my predictions, my bootstrapper slash related predictions for 2025. So thanks for joining me again this week for a look back at 2024, revisiting some key concepts, my favorite episodes, some other happenings, and revisiting those predictions. It’s great to have you here this week, every week. This is Rob Walling signing off from episode 745.

Rob Walling:
Welcome back to Startups. For the Rest Of Us, I’m Rob Walling. This is Hot Take Tuesday. In this episode, we talk about the rise of Blue Sky and a r and Tracy wind up making a four figure cash bet about where they think Blue Sky’s going to be three years from now. Talk a little bit about TinySeed and how we are raising our next fund, how Y Combinator backs competitors and more hot take Tuesday topics. Before we dive into that, the SaaS Launchpad course, this is the most comprehensive and best course I’ve ever released on early stages, the very early stages of just getting started. Idea validation, launching, building a launch list, getting to your first revenue. The course is live and we now have a free sample module called the DNA of a great SaaS idea. It’s a 28 minute video. This is 28 minutes of about, I think we have nine and a half, maybe 10 hours total of instructional material as well as dozens of worksheets, checklists, forum where people are discussing the ideas and throwing ’em back and forth. 

It’s at SaaS launchpad.co if you want to check it out. This is the first and only trial that we’ve offered for this course to give you an idea of the level and the quality of the content because the quality of the content is far, far superior than stuff I’m putting out on YouTube. It is far more in depth and it is a book level depth in a video course with full transcript summaries and all that. So SaaS launchpad.co, click the start free button to download the free sample, the DNA of a great SaaS idea. And with that, let’s dive into Hot Take Tuesday. This week I’m joined once again by Tracy makes on Twitter,  

Tracy Osborn:
Well, I’m there, but or tracy osborne.com on Blue Sky.  

Rob Walling:
Ooh, blue Sky. We’re going to get into that in just a moment. And Mr. And our set on Twitter.  

Einar Vollset:
Absolutely. How you doing  

Rob Walling:
As well as your real name? Are you on Blue Sky?  

Einar Vollset:
No.  

Rob Walling:
All right. Are you going to get on Blue Sky?  

Einar Vollset:
No.  

Rob Walling:
All right, so let’s talk about  

Tracy Osborn:
This. I would bet money you are.  

Rob Walling:
First topic of the day, is Blue Sky going to do it? Meaning do we think Blue Sky is going to survive and thrive? Tracy, I’d like you do. I need you to steal, man, this argument of Blue Sky because it sounds like you are leaving Twitter in favor of Blue Sky. Talk us through what’s going on.  

Tracy Osborn:
I am a Twitter OG whenever that year. That was way back in the day and I freaking loved Twitter seven, and it was one of the things that really catapulted my career in tech and I thought I was all in. But I got to say the vibe has changed and the vibe has changed pretty significantly in, it’s been changing for a little bit of time due to certain events with the selling of Twitter and whatnot. But I feel like it’s very different in the last few months. And for me personally, it doesn’t suit my purpose anymore and it’s not a place that I find very fun. It’s not useful for me for my career stuff, and Blue Sky seems to be taking hold. It’s like Twitter in 2007, 2008, and that’s really fun. So I am over on Blue Sky enjoying those early days where people are doing a bunch of little apps and creating analytics and doing little silly things. All the things that you go to be able to do on Twitter with the API stuff, I’m sure it’s going to change and evolve over time, but it just, it’s the kind of thing that I want to be a part of rather than what Twitter has turned into now.  

Rob Walling:
Got it. So for you it’s a personal preference of the type of social media that you’d like to be part of  

Tracy Osborn:
And I also feel like there’s an opportunity, might as well make an account. I did one for TinySeed, just I’m going to cross post between TinySeed and Twitter and Blue Sky for the time being because I feel like might as well. And if it does take off then it’s already there and it’s pretty nice to have that in there because Blue Sky, you can verify using your domains, so it’s really easy for people to find TinySeed. It’s just TinySeed dot com. So I feel like there’s some business reasons to do it, jumping on a network when it’s early, but largely for me it is personal preference in terms of the way I want to experience a social media network  

Rob Walling:
And our V set, what’s the counterpoint?  

Einar Vollset:
These are all good points. I think I just can’t be bothered to join another thing. I’m like, why do I care? I mean honestly, I’ve been on Twitter since 2007. I think I am on there all the time. You see, it’s changed radically. It hasn’t changed all that much for me. It’s always kind of been a show for years now. That’s what I’m used to. It is what it is.  

Tracy Osborn:
I mean, you’re in good hands with your posting, so it is. That’s true.  

Einar Vollset:
And 

I think certainly it used to be a certain kind of place I think before and it was pretty left wing, it was pretty progressive, it was pretty of a type and I think it’s become more balanced let’s say now than before. And so I think you’re more likely to see things that maybe you don’t agree with than you used to. I feel like it used to be very, if you were a San Francisco type liberal, you get a lot of reinforcement of the things that you believe on the old Twitter versus now you definitely get some of the other stuff. And I don’t know some of the stuff, there’s no doubt that I see full on. I see both communists and Extreme right wing white nationalists on Twitter more than I used to, but I mean it’s always been for me, I just don’t think it’s changed all that much I think.  

Rob Walling:
And how about Blue Sky? Do you think Blue Sky will gain traction and be around in three years and be bigger than it is today?  

Einar Vollset:
No, I think it’s just a hissy fit to a degree. And I feel like it’s been that there’s been Threads was kind of the same. What was the other one before that? Wasn’t there another one? Not this Macon Bason. There you go. That was the new thing that was supposed to be a thing, and I’m like, yeah, okay, great. If it becomes a thing, then it’ll be a thing. And I am not saying I’m not going to wander over there, but right now I’m like, look, I only need so much screen addiction. Twitter gives me plenty of that.  

Rob Walling:
And for me, I think we’ve kind of heard two viewpoints here pro and con, and I’m genuinely the middle. I do have an account on Blue Sky, I’m Rob Walling dot com if folks want to hook up with me there, and I’m more doing it to keep an eye on what’s going on. I am posting some of my Twitter posts over on Blue Sky. I find that the community is much smaller. I know everyone that I’ve followed in essence, which is interesting for now, but the volume over there, it’s just very light. If I open Blue Sky a couple times a day tops, I’m like, oh, I’m all caught up because I’m just looking at the people you follow tab and I only follow hundreds of people. So it’s not just this constant free flowing flow of stuff that I don’t necessarily care about Twitter for me, I don’t care about the political stuff. 

It just doesn’t bother me either way, left or right. I’m just kind of like whatever. I mean, if something’s offensive, obviously it bothers me, but I’m not seeing an inordinate amount of left wing or right wing or whatever. I’m just seeing. I don’t care about, I’m seeing stuff from whether it’s Elon Musk or some celebrity who posts something or blah and it’s just like, I didn’t follow this person. I don’t give a fuck about this topic at all. So that’s the thing that I’m a little fed up with. So I’m going that there’s the what is there, the four U tab, and then there’s people you follow tab, but then I go to people you follow, there’s a reason. There’s an algorithm that is boring. There’s a lot of people I follow that’s like, man, I really don’t care about what’s going on with you.  

Einar Vollset:
I’ll say that one thing I have started doing with the following that I had to do when you guys sort of forced onto the four U tab is when you see things that you’re like, it’s stupid, tell it. It does work pretty well. I feel like if you’re just like, I don’t seeing what I see on Twitter, I’m like, whoa. Or X, sorry. Then I think like, well, you’re just not telling it what you don’t like, because it pretty quickly shapes into if you spend half a day looking through and being not interested, not interested, not interested, it does update pretty quickly I would think.  

Tracy Osborn:
So I have one more point before we kind of evolve the conversation, but I just wanted to bring it back for folks who might be thinking about should I move over and the vibes of blues for folks who are indie hackers, makers trying to share what you’re doing in public. So if that’s something that you look forward to being part of a community of folks, sharing what you’re working on, how you’re building your next indie project and whatnot, then I would say check out Blue Sky. I think that in particular, that area has been really taking off.  

Rob Walling:
And Tracy, your prediction, do you think Blue Sky will be around in three years and bigger and have more traction than it is today?  

Tracy Osborn:
I would bet so. I could be wrong, but it feels like it terms of the herd instinct of folks and the herd instinct of tech press and whatnot. There’s more now than there was when Macon and Threads and everything else launched a few years ago, including Blue Sky, which was the two years, I guess Blue Sky has been around for a few years and nothing was really happening. And then finally this magical moment happened where people all of a sudden moved over and they had that inflection point. I think that now makes the service more useful.  

Rob Walling:
And so just because we want to keep things interesting. Tracy Einar, what are you going to bet? What kind of cash are we going to put on this bet of It’s a three years out, so someone’s going to have to remind us. Reach out. Listen to this episode.  

Einar Vollset:
I think it should be a hundred bucks.  

Rob Walling:
Oh, I was going to say a  

Tracy Osborn:
Thousand.  

Rob Walling:
Wow. Whoa. Now we’re talking. Yeah. All right. You heard it here first. Tracy Osborn. Thanks. Three years. Wait, AER has to agree to  

Tracy Osborn:
1,002.  

Einar Vollset:
Whoa, whoa. What’s the definition of being around here? Because I can see Tracy buying bluesky.com and just spinning up her own little thing three years from now just to get a,  

Tracy Osborn:
Which bluesky.com is not the network,  

Einar Vollset:
Isn’t it?  

Tracy Osborn:
That’s someone else. So I’m sure they’re just  

Einar Vollset:
Wait minute, wait a minute. Why do they name it bluesky if they don’t own blues sky.com? What is the domain then?  

Tracy Osborn:
It’s like B sky.  

Einar Vollset:
What? Actually let’s make it $10,000. This isn’t going to last you into the fucking next year. Forget it.  

Tracy Osborn:
No, I’m capping out a thousand here.  

Rob Walling:
So a thousand dollars and yeah, not that it’s around in three years, but that it has significantly more traction. Do you know what’s the daily active users right now? Anyone?  

Einar Vollset:
I mean it’s Tracy and you guys. That’s two.  

Rob Walling:
So I just did a quick Google and it says that Blue Sky has 20 million users. That’s not daily active. That’s not monthly active. It says user. So I’m thinking that’s registered account. So what is the definition of in three years, this being around and having significantly more traction,  

Einar Vollset:
Significantly more, a hundred million.  

Rob Walling:
I was going to say 50 or a hundred. It’s got to be somewhere in there. If it’s 30 is not it. This is a dying social network. If it adds 10 million in three years, so let’s say a hundred, I like that.  

Tracy Osborn:
I would also say if Rob Walling posts more on Blue Sky than Twitter, at that point, I would consider it a live network at that point. Wow.  

Einar Vollset:
Okay. So all I have to do is convince Rob not to post more on there and make a thousand bucks. Hey  

Tracy Osborn:
Rob, you want to make 500 bucks? Sure deal. Do that to your detriment,  

Rob Walling:
Moving on. And where is Threads and all this threads? What are you doing, man?  

Tracy Osborn:
Threads just engage. Every time I open Instagram, it’s like, Hey, let’s look at the thing that make people pissed off so they’re all responding to this. So for me, it’s threat. I mean, I clicked on it a few times. It is interesting. People are like, oh, I was at the airport and Delta screwed me over and I talked to this person and I clicked on those a few times because like, Ooh, I want to know what happens next. And then I realized, wait, it’s just pulling me in by making me pissed  

Rob Walling:
Off. Exactly. It’s the worst of  

Tracy Osborn:
Social media. And so Zuckerberg, he just announced, he finally put in, because Blue Sky is taking off, they added an option. So you can just see the folks you’re following on threads. They’re feeling some pressure from Blue Sky and they’re changing threads in response. I think folks are so fed up with threads that I feel like they’ve kind of missed the boat, so to speak.  

Einar Vollset:
I don’t get it. So the reason I think I didn’t sign up for threads was I have a private Instagram, just family things and you have to use this account. And I’m like, no, I’m not doing that. This is a private, this is why I never signed up for Threads. I just didn’t want to open that Pandora’s box. So why aren’t people pissed off with threats?  

Rob Walling:
It’s just too algorithmically driven. Everything is engagement based. All the posts you see is people being angry or people doing When I post A, so what are the most underrated guitar solos of all bands from the seventies? And then you want to weigh in, right? You’re like, oh my gosh. Well, obviously Jimmy Page is solo on StarWay to Heaven is just underrated, dah dah, dah.  

Einar Vollset:
You’re so old. Dude,  

Rob Walling:
That’s seventies. Are you nearly 60? No, not even close. And so that feels just rude. I wonder.  

Einar Vollset:
Played rude. There we go. Perfect.  

Rob Walling:
For listeners who don’t know, I just held up my a RP card. Someone thought it was funny to sign me up for the American Association of Retired People here  

Einar Vollset:
In the United States. It wasn’t a problem.  

Rob Walling:
Anyways, it’s engagement bait. It’s just vapid content. It almost feels like just listical type stuff. So I go there, I don’t go there anymore. I’m just like, I don’t need this in my life. It’s not interesting. So let’s move on to our second topic. I hear rumor that TinySeed is raising their third fund, a r vol set TinySeed dot com slash invest. If you are an accredited investor and you want to invest in US companies or UK entities, you want to talk people through what’s going on. We’re just kicking this off.  

Einar Vollset:
I mean, I guess most people know TinySeed and what it is and why we’re doing it and all that stuff. We’ve been doing it now since 2019, so it’s been half a decade. Unbelievably  

Rob Walling:
First startup accelerator for SaaS.  

Einar Vollset:
Yeah, and it’s worth thinking about 2019, what was going on at the time. It was right around the time actually it was Sam Altman now of OpenAI who wrote an article, I think he was YC president at the time or maybe he just left or just starting. He wrote this article saying how to invest in startups. And his main point was don’t invest in anything unless it can be 20 billion. And really TinySeed was sort of a response to that. It was like, look, there’s got to be a different way to help founders who wear successes selling to private equity or strategic for 50 or a hundred or a couple million dollars. That sounds like success I think to most people. And so really that’s what we’ve been trying to do with TinySeed and we’ve been doing it, like I said, we did our first fund 2019 deployed. 

That was kind of at the time I actually got some advice saying, you should call this your fund zero prototype fund. And I kind of wish I had done, but I didn’t. So it is our fund one. We raised about $5 million. I’m sure our compliance person is going to shoot me now, but our sort of mark on there is we’re at about two two and a half x markup on that fund, which it’s not quite apples to apples, but certainly Carta came out with a venture benchmark report here earlier this year and we’re basically in the top five to 15% of most metrics of venture funds. We’ve started returning capital from that fund. And then we raised our second fund in, well, two funds really. One US focused and one European EMEA focused in 2021 in 2022. And those are also starting to sort of trend the same way. 

And really this fund, the strategy here is like, look, we think this seems to be working and we’re sort of just looking to keep executing on that strategy. So if this is interesting to people get in touch through that invest page, you’ll eventually end up in my inbox and I’ll reach out and I can share some more information. And like I said, you have to be accredited or a sophisticated investor depending a little bit on the fund and there’s some minimums and some things there, but certainly get in touch and I can describe what we got going on.  

Rob Walling:
And we’ve invested in a lot of companies approaching 200 B, two B SaaS companies, and so that we’re going to continue investing hopefully at that pace over the next several years. So it’s a really nice way to index in quotes into a lot of early stage B2B SaaS companies. I don’t know of any other place that you can do it. We do it just the ecosystem of MicroConf TinySeed, this podcast and my books and all that. It really has, if you’ve ever been to a MicroConf event in person or online, it’s a unique group of folks and a good chunk of the TinySeed companies come out of folks who are in this community.  

Tracy Osborn:
I mean, it’s the REDDEST community, the best community out there.  

Einar Vollset:
Yeah, it is. I think it’s one of those things where it’s like, look, if you believe that sort of B2B SaaS, the mostly bootstrap, there’s value creation there. It is one of the better ways to access that market. It’s hard to do as an individual investor just because it’s so early. You really need to be making enough bets that you have the chance of finding the ones that do really quite well and getting access to that deal flow. And that’s very, very hard to do as an individual investor and probably only a handful of people worldwide could do it in sort of the same way that we do.  

Rob Walling:
Our third story of the day is TechCrunch article about Y Combinator. It says Y Combinator often backs startups that duplicate other YC companies. Their data shows it’s not just AI code editors. And to give folks background, if you’re an accelerator and you’re investing in a lot of companies, you inevitably will back competitors over time. And at TinySeed, we have also had to face this because you can’t invest in 200 B2B SaaS startups and expect to never invest in two companies that compete, right? So 500 startups has this Techstars yc, they’re all going to have it, but this TechCrunch article where they analyzed the data was interesting. I have kind of mixed feelings about it. I think I’ll probably kick it over to Tracy for first thoughts.  

Tracy Osborn:
The thing that really resonated with me, particularly because I’m part of the TinySeed applications process and going through interviews and picking folks and sending over offers, is that they specifically called out that they are backing the founders, not necessarily the idea, which is very similar, pretty much what we are doing as well because things change over time. People pivot, they find new ideas, they change their positioning, and folks can already, even if we try to do it based on the companies themselves and try not to back competitors, then eventually they’re going to be competing At some point people are going to, they might pivot, move around, might. Yeah, totally over time. So I thought I really resonated with that part and I was like, okay, good. I mean that we won’t really compete with yc, but it does show how the right person, the right driven person who is all in just executing super fast and doing really good stuff. It’s something we do at TinySeed and YC is doing that as well. But also yc, what are they doing per batch? I guess they’re doing four batches per year now and hundreds per season.  

Rob Walling:
I think it’s 150 to 200.  

Tracy Osborn:
Yeah. Well at TinySeed we have some competition, but then you step back at yc and then of course they specifically say in the article that even within batches and even within, I forget what they call it, but a cohort with their one partner, they’ve had competitors within that. And I’m like, that’s a little bit too close for me for my comfort with TinySeed. I want people to feel comfortable. This is something I did I had to deal with in 500 startups because I was with another startup doing wedding stuff, and that’s a whole podcast on its own, how awful that was. So I’m always cognizant of that at TinySeed. I’m surprised at YC doing that, but they’re kicking butt, so they must be doing something right.  

Einar Vollset:
I think it’s hard. One of the points that we make at TinySeed founders too is like, look, even if we had a strict, which we don’t, a strict policy, we would never back somebody who’s competing to anybody, not possible, but companies pivot all the time. It’s almost like a religion just to be like, it’s not working. Let’s do something completely different. And what are you going to do? Say people like, sorry, you can’t pivot into what you want to pivot to because we’re already backed someone doing that. That’s not going to work particularly as a minority investor, but just in general, it’s just like you can’t stop people doing that. Like I said, and the batch sizes are now, I think it’s more than 150 now. I think it is probably a couple of hundred. It used to be for the longer. I think 2020 or 2021 was the high point. It was like 300 or 400 per batch,  

Rob Walling:
But they were doing two batches a year. Now if they’re doing four, it’s got to be a little smaller. Yeah.  

Einar Vollset:
Oh, that’s right. Oh, then it might be a hundred or 150. I don’t know.  

Rob Walling:
So folks have an idea. We back across Americas and emea, we do two rounds per year every six months, and we get about 22 to 30 companies between both of those. So still a good pace, but it allows us to be a lot more hands-on and ideally not back direct competitors within the same batch. That’s kind of something we have been able to avoid to date because that feels like it could be a little bit awkward.  

Tracy Osborn:
I should mention that if there’s anyone who’s like TinySeed or yc do both. We have a few folks that have gone into TinySeed and then gone to yc. There’s advantages. I say obviously as someone who’s running a TinySeed accelerator program and being very biased towards it, but also my husband went through Y Combinator for different programs like YC is what they do, they kick butt at. And what we do, I think we kick butt at it too, but they don’t necessarily conflict. So if there’s anyone who is like, you know what, I’m looking for an accelerator program in B2B SaaS, we are fans of yc and we do encourage folks who are in TinySeed that feel like that’s the place where they want to go to jump into that, but you’re going to have a very different experience in terms of that. We have a lot fewer founders, a lot of you companies, whereas in YC, you’re going to be one of thousand. But they have other advantages that make up for it.  

Rob Walling:
And we focus on B2B SaaS. We are some of the best in the world at this. And so if you are B2B SaaS, you’re going to get more direct help. But man, if you want to raise buckets of money, this is going to play a better place than yc easy to raise. Our next story is an article on Swapnil Han’s blog. Sorry about the pronunciation there. We will certainly link this up. Title is procrastination and the fear of not being good enough, and it’s actually a short article. There’s some headings, am I just not good enough? Do I care too much about what others think? Pushing through to be able to ship stuff. The reason I bring this up is imposter syndrome is often talked about in startup space and we see mindset being such a critical element to founder success that we actually retroactively went back. 

We have our tiny C Playbook, which is seven different modules. We added playbook zero that is all about mindset. And this is a big part of it is getting over imposter syndrome. It’s not fake until you make it because faking it, I have such issues with this online of people faking stuff that’s not real, but it is internally maybe having more confidence than you think you, you should. But people get hung up and they get analysis paralysis and they don’t take action. They don’t know if what they’re doing is right and blah, blah, blah. And that is really what I wanted to call out because I know a lot of founders feel this and I know a lot of founders deal with this as they’re starting their company of not knowing what to do next, not knowing if they’re going to succeed, wondering when everybody’s going to find out they don’t know what they’re doing. So to kick us off and our ep, have you seen this trait in founders and what is your take on getting over it?  

Einar Vollset:
Yeah, I think it’s actually one of the biggest mistakes you can do as a founder. That’s sort of what I think. And I think not like fear not being good enough. That’s hard. Just get over your fear not being good enough. But I think what it materializes into a lot of the time is like you say, analysis paralysis, needing more and more and more data and favoring analysis over just action. And it’s one of the things that we tell our founders pretty early on and just try to hammer into them. And if I could filter it for this at the interview stage, I would just because I think it’s so important just as having a bias for action and being okay with operating under uncertainty. We had to kick off in Barcelona here a couple of weeks ago and I told this piece then I was like, look, a lot of the time this analysis paralysis or not moving fast enough, not moving stuff tends to be because founders, they really want to reduce uncertainty. 

They kind of don’t want to spend resources or time worrying that it’s the wrong thing. It’s uncertain whether they’re going to get a payback, particularly if you’re sort of bootstrapped, you don’t have a lot of resources, you don’t want to waste it. But my point that I was making these guys is like, look, you want to embrace uncertainty. That’s what you need. If you didn’t have uncertainty, you’d be dead in the water. As a startup, if you don’t have uncertainty on something, there’s nothing for you to exploit. If there was an market opportunity that had zero uncertainty about it, how to do it or whether it was worth doing, then someone more better resource than you would’ve already done it. And so a startup person as even as a bootstrapper, you want to operate in environments that have reasonably high uncertainty and you don’t want to wish it away. 

And I think your superpower as a startup founder tends to be tolerating operating uncertainty and making mistakes and still being able to move fast and do things under those kind of conditions. And I think sometimes around founders who sort of wish there was less uncertainty, but I actually think that would be a mistake. I don’t think there is put a gold at the end of the rainbow if there is no uncertainty. I just don’t think it’s a thing. You have to embrace the fact that, look, if you want no uncertainty, you should go get a job. And even that’s not completely uncertain, but you shouldn’t want to be a startup guy if you can’t oral, if you can’t handle that uncertainty and sort of embrace it.  

Rob Walling:
How about you Tracy? What are your thoughts?  

Tracy Osborn:
I definitely drink the TinySeed slash Einar.  

Einar Vollset:
There’s  

Tracy Osborn:
Another place where I see there’s a side to this. I see in myself I, I’m an information gatherer and I love reading things, everything I can about B2B SaaS and sales and churn and all that kind of stuff. And there’s a paralysis of then knowing what the right way of doing things and being aware of how much work it is to do it the right way. And then I kind of procrastinate because I’m aware of how much work it is. Whereas before when I was just getting into startups, I kind of just flung myself into things. I got things done because I didn’t actually have an awareness of how much work it actually would be. And I was blissfully unaware about of what it could be like to be a founder. And so I was just executing fast and doing the 80 20 and all that kind of stuff. And now it’s a little bit intimidating when the full sales process and all that kind of stuff, rather than just being, getting on the phone with someone. It’s easy to procrastinate when you have too much information.  

Einar Vollset:
I think sometimes it’s just a matter of I didn’t realize that we couldn’t do it, so I just did it. Actually. 

It’s like General Patton during World War II famously, or maybe if you’re just a nerd, he got an order not to take to bypass this German city because he was going to take four divisions and they didn’t think it was worth it. And he radio back and says, I took it with two, should I give it back? Kind of thing. So I think there’s a certain amount of that. The ignorance is blissing, but I also think one thing to internalize also is that most doors are two eight doors. There’s very, very, very few things in the startup world that can’t be undone if it turned on out to be the right thing. And it’s just to a degree just kind of try it and see it tends to be the best approach.  

Rob Walling:
Our last story of the day is about Australia proposing their quote, world leading ban on social media for children under 16 from Reuters. We will link it up in the show notes. Tracy Osborne is someone who has been on social media since you were 16. No, I’m just kidding. But  

Tracy Osborn:
I mean kind of. I was 11 years old. Was  

Rob Walling:
It Tumblr?  

Tracy Osborn:
No, this is before Tumblr. I had  

Rob Walling:
TI  

Tracy Osborn:
Had, yes, I owed bed a chat into my website. I had a Terry Brooks fan website and I had a chat on there and Terry Brooks, the author, fans around the world would use my chat and my dad would be like, what are you doing? Are you in a chat room? And I’d be like, no. And I go back to talking to all my friends on the internet. So technically yes, there was some sort of social network that I was probably not supposed to do it that time, but as an adult, as someone who is in her forties, I feel like the internet has kind of updated. I’m curious, Rob, you have kids and I’m curious what you think about this. I don’t have kids myself. I just have my own experience of,  

Rob Walling:
Yeah, it’s interesting and then I’ll pass it to a R as well, because a R has kids under 16. I don’t think social media is good for anybody. I especially don’t think it’s good for kids who are just so much more addictable, which is not a word, but it’s just easier for them to just get hooked on stuff. As you can tell by you, give a 10-year-old an iPad and they’ll play it for 24 hours straight and not eat and not sleep and all that. Not saying adults don’t do that, but it’s definitely the brains are still forming. So I don’t think social media is good. I also don’t think kids having cell phones carrying around all the time is good. And yet I have a 14-year-old with a cell phone and I have an 18-year-old with a cell phone. The question for me is, do I want the state legislating that? 

I guess if the state does, then that makes it easy across the board because then when my 14-year-old says, but you won’t let me on insert name of Snapchat, it’s like, oh man. But all the other kids do, and if the country bans it, then it’s not an issue for me. Now, do I like the country or my government overreaching and telling me what kids can and can’t do? Well, I mean I guess they do it for alcohol, right, and smoking. And is social media as bad for them as that? It could be debatable, right? They’ve done studies of the high suicide rates. So I overall am probably just fine with governments limiting children’s use of social media. I do think it should be the responsibility of the parents, but I just know so many parents that don’t it much be like, let’s say there was no drinking age minimum and there was no smoking age minimum, that would be a problem. 

There would be parents that wouldn’t care, wouldn’t enforce, and we’d have 13 year olds, not that we already don’t, but we’d have 13 year olds smoking a pack a day and drinking a bunch. So I do think having the laws and some barriers is not a bad thing for the government to impose. My kids are barely on social media. They’re more like in Discord and they’re in messaging apps where they message friends, but they’re not in public places where they’re posting. They’re not doing Twitter, Instagram to public audiences. Einar Vollset, you have kids under 16. Are they on social media? And what do you think of policy like this?  

Einar Vollset:
Well, it sort of depends. I define social media, but no, they’re not on social media that I’m aware of anyway.  

Rob Walling:
That’s the thing.  

Einar Vollset:
They’re on discord with their friends and YouTube is a constant in my household. So that’s the thing. Yeah, I guess I don’t more the libertarian side when it comes to this. I don’t trust the government to tell me what to do with my kids fuck yourself kind of thing. This tends to be my standard MO when it comes to, I’m like, really? You’re going to regulate this? And this is me having been in academia. Anytime there’s a newspaper piece about what experts found, I’m like, did they now? Okay, I don’t believe you. So that tends to be the thing too. So I’m like, look, good for you Australia. You do what you need to do. But do I think, would I be excited if Gavin Newsom decides to this apply to California? No, I wouldn’t. I would almost be like kids that sign up for social media. But that’s probably more my personality, more anything else.  

Tracy Osborn:
I mean, I look also back at my 11-year-old self clicking through all the, are you 13 messages on the internet? And I was like, yep. Even though I was 11. So it’s not like it’s hard to get around.  

Einar Vollset:
No. So I actually only peripherally paid attention to this thing. And the Australia thing is, look, the more concerning thing, and this is again, the more libertarian side of my personality is like, how are they going to enforce this? And the answer is apparently that they’re going to require all Australians to provide identification to access the internet. And at that point I’m like, no, no, you don’t get to do  

Rob Walling:
It. That’s the problem is these things infringe, right? They start getting real up in your face. Yeah,  

Tracy Osborn:
They have good intentions, but the outcomes are terrible. Yeah.  

Einar Vollset:
Yeah. So that’s my view. I’m like, I don’t think so. My personal view,  

Rob Walling:
Tracy Osborn, if folks want to keep up with you, you are. Tracy makes on Blue Sky.  

Tracy Osborn:
I mean it is. In my title it says Tracy Osborne parentheses. Tracy makes literally for you, Rob. I put it in there.  

Rob Walling:
I’m going to say this is not going to die with you. You know that Tracy Osborn dot com on Blue Sky and our vol set while you are in our set on X Twitter, if folks want to keep up with you, they should head to TinySeed dot com slash invest.  

Einar Vollset:
That’s right.  

Tracy Osborn:
He’ll be our best friend. If you come with a bucket of money,  

Einar Vollset:
Buck I money. I’m only accepting pockets of money these days. No small change. A hundred dollars bills only. Yo,  

Rob Walling:
Thanks for joining me. You too.  

Einar Vollset:
Thank you.  

Rob Walling:
Thanks to tracy osborne.com and a r vol set for joining me this week on the show. And thank you to listening to this episode and with you’ve been listening for five or 500 episodes, I appreciate you being around. If you keep listening, I’ll keep recording. This is Rob Walling signing off from episode 744.

Rob Walling:
I’m Rob Walling and in this episode of Startups For, the Rest, Of Us, my wife, Dr. Sherry Walling and I read chapter one of our new book called Exit Strategy, the Entrepreneur’s Guide to Selling Your Company Without Regret. This effectively will become the intro and first chapter of the audio book, so you get a free preview of the audio book to see if you might like it. The Kickstarter for this book closes this week on December 12th. You can of course go to kickstarter.com and search for exit strategy or you can follow the link in the show notes. It would be amazing to have your support. This campaign is not doing as well as the SaaS Playbook did, and so every bit helps, every pledge helps, and even if you are not thinking about selling your business today, I believe it is never too early to set yourself up for success, even if it’s months or years down the line when you decide to sell. 

And this book talks about all this stuff to think about before, during, and after. And the before section is super helpful even if you aren’t thinking about selling today. In addition, applications for the all new MicroConf Connect are closing today. December 10th. MicroConf Connect is our application only membership and we only open applications once per month to ensure everyone who’s accepted is onboarded together in a cohort and that we can give them the support they need. All members who sign up will have access to an Ask Me Anything with me on December 12th. If you miss the application date though, you can make sure to sign up for the wait list. We’re going to reopen applications after the new year. That’s MicroConf connect.com and with that, let’s dive into the intro and first chapter of Exit Strategy. You’re listening to Exit Strategy, the Entrepreneur’s Guide to Selling Your Business Without Regret. Written and narrated by Sherry Walling, PhD and Rob Walling,  

Dr. Sherry Walling:
Not PhD.  

Rob Walling:
Well done  

Dr. Sherry Walling:
Rob Walling Odd Blank Space.  

Rob Walling:
Thanks for pointing that out. This book has a forward by John Warlow, the author of Built to Sell and several other books about selling your company.  

Dr. Sherry Walling:
He’s a pretty smart person,  

Rob Walling:
Very smart. It was awesome to get his forward book is Copyright 2024 by Rob and Sherry Walling. There’s a lot of praise in here. John Warlow, Jason Cohen, Derek Sivers, JJ Virgin, Sam Parr. Ben Chestnut. I think we did good. I really appreciate everyone who wrote us a testimonial.  

Dr. Sherry Walling:
How much did you have to pay those people to say nice things about this book?  

Rob Walling:
Exactly. $0 and 0 cents. Did send an email to them though. Really appreciate  

Dr. Sherry Walling:
That. Thanks y’all for saying nice things about the book and reviewing the book. I mean, a bunch of them actually read the book.  

Rob Walling:
That’s the dirty little secret right of author blurb. Testimonials is most of those are just because someone and they don’t actually endorse the book, they don’t read it, but I get the sense that most or all,  

Dr. Sherry Walling:
Most of our people, this book,  

Rob Walling:
Yeah,  

Dr. Sherry Walling:
This book is dedicated to Genesis Riley Cook being her guardian parents taught us a great deal about going all in on love and letting go with grace. So let’s jump in. This is the introduction. The last days exiting your business with intention. It feels like I’m going through a divorce. This is the most stressful thing that’s happened to me outside of my wife getting cancer. Is it reasonable to feel like this is one of the most difficult parts of my life? These thoughts are not what you would expect to hear from someone in the midst of an event that will leave them millions of dollars richer, but we hear them all the time. Different wording, different dollar amounts, the same sentiment I’ve been working my whole life for this moment. Why is it so painful? Selling your company is one of the most fragile points in the life of an entrepreneur. 

It is a messy psychological process, often accompanied by an implosion of identity and emotional stability. It requires an extraordinary amount of focus over a long period of time. It disrupts your sense of meaning, your sense of accomplishment and your vision for the future. It’s extremely challenging for your personal and professional relationships. Exiting a business is a transformational experience that few people have Beyond the headlines and highlight reels, there’s sparse conversation about how to do it well. We have a few models to describe the nuts and bolts of the process, but none to guide the deeply personal aspects of a monumental deconstruction and reconstruction of one’s life. We call an exit transformational because it involves change at every layer of life. From the way you introduce yourself to how you begin each morning, what your bank account looks like and the fears that keep you up at night building and then leaving a business is emotionally similar to raising a child who heads off to adulthood and inadvertently fires you from the day-to-day tasks of parenting. 

You can do everything right and have a wonderful outcome for all your labor and still feel deep emptiness and disorientation. Like any good story, your business has a beginning, a middle, and an end. There’s the seed of a dream that kicks off the adventure. There’s the arc of the story complete with try fail cycles, emotional peaks and valleys and plenty of high stakes, and then there’s the big finale, the exit. You will exit your business. You might sell it. You might go public and get voted out by the board. When you don’t hit your quarterly targets, you might shut it down either by choice or because you feel the story arc has finished or because you run out of money. You might choose to step into retirement and hire someone to take over day-to-day operations. You might die and leave the spreadsheets and shipping deadlines to be decoded by your co-founder, COO or spouse. 

One way or another, your relationship with your business will end and although there are several ways this relationship can end, this book focuses on exiting via a sale. This is the exit most entrepreneurs aspire to achieve, one that warrants significant preparation and planning. Every founder knows this intellectually, but if you think about their exit until it’s too late and no one is prepared for how hard it’s going to be, the good news is that you get to shape the story arc of your company. You get to participate. Are you writing the story or is this story writing you? There are plenty of books about major life transitions from aging to divorce to empty nest. The sheer volume of self-help and practical guidebook speaks to how difficult and momentous these major midlife shifts are for the human psyche. However, few books prepare you for selling your company. 

Of course, exits are not nearly as universal as kids leaving home or the slow transitions of aging, but for the millions of people who identify as entrepreneurs, some kind of exit is inevitable. This significant and disruptive experience in the life of the business owner is not given the thought or attention that it deserves. Exits are complicated. They are financially and legally intricate. They are incredibly stressful. There are many relational implications. They also rearrange a founder’s identity in deeply felt and widely sweeping ways. No matter where you are in the process, it’s important to prepare yourself for your exit to achieve your optimal outcome. You must be mindful about setting yourself up for the exit trajectory most congruent with your goals. Exits are not magic. They don’t just happen one day when the money wizards stops off at your office with a wheelbarrow full of cash. They are usually the result of careful planning and thoughtful decision-making. Failing to prepare can result in many complications even if you do achieve your optimal outcome and sell to someone you trust. For buckets and buckets of money. A simple truth remains. Selling is one of the hardest experiences of a founder’s life.  

Rob Walling:
When we tell this to entrepreneurs, they rarely listen. They nod and they smile politely. They hear what we’re saying, but they don’t really listen. After all, every part of entrepreneurship has been challenging and if they’re going to sell anyway, what does it matter that it will also be hard. We’re not telling you this to scare you off. You already know selling will be hard even if you don’t yet know how hard and who better to prepare you for this difficult journey than a clinical psychologist specializing in entrepreneur mental health and a serial entrepreneur with 20 years in the trenches supporting founders through the full scope of the entrepreneurial journey.  

Dr. Sherry Walling:
Hey, that’s us.  

Rob Walling:
That is us. Between the two of us, we’ve seen hundreds of founders through their exits. Dr. Sherry has been helping entrepreneurs with their mental health relationships and big decisions since 2016. Prior to this, she spent 10 years helping people put their lives back together after trauma loss and major disruption. She has deep expertise in grief along with personal experience coming back to life after a significant loss. For more on this, check out her book Touching Two Worlds.  

Dr. Sherry Walling:
As the co-founder of MicroConf for TinySeed, Rob has worked with thousands of founders across all stages of business. He has also started six yes, six companies and gone through multiple exits including his successful and wildly stressful exit from Drip.  

Rob Walling:
Did you roll your eyes when you said six companies? Like each one of those took years off your life?  

Dr. Sherry Walling:
Yeah. I can name all of my gray hairs and wrinkles after the companies that  

Rob Walling:
After each of the companies, our first book for startup founders, the Entrepreneur’s Guide to Keeping Your Shit Together, how to run your Business without letting it run You helps you navigate the beginning and middle of your business’s story arc. This book is about nailing the big finale. In writing this book, we aim to shine a light on the path before you so you can see the challenges and pitfalls ahead. We can’t make those challenges and pitfalls easier, but we can prepare you to face them. Our goal is this to help you protect your family, your relationships, and your mental health while working toward the best possible exit for you and everyone in your company. This book offers frameworks to simplify the complex mental, emotional, and relational challenges of exiting. It draws on the combined wisdom of thousands of founders we’ve coached, talked to, laughed with, cried with, and advised over the years.  

Dr. Sherry Walling:
You’ll also hear firsthand lessons from Rob’s own experiences selling his companies and my experience during him on as well as insights gleaned from interviews with other entrepreneurs about their exits.  

Rob Walling:
Finally, we provide practical strategies to help you exit well. We will touch on the elements of a deal and some basics of negotiation, but this book focuses more on the space between your ears than the line items in the contract. For detailed guidance on deal structure and company preparation, see our resources at the end of this book for well-crafted, practical content about preparing your business for your departure. Whether you’re selling an e-commerce company, a children’s brand, a trapeze franchise, a consulting agency, or a software as a service or SaaS business, we’re here to help you prepare. Every exit is unique and there’s no such thing as a game plan that will lead you through all the steps. As the Spanish poet Antonio Machado wrote by Walking the path is made and when you look back, you’ll see a road never to be trodden again. No one can tell you how to walk the path, but we can equip you for the journey. Let’s get started.  

Dr. Sherry Walling:
Let’s get started. Section one of the hardest things you’ll ever do. Chapter one. Why is this so difficult? Julie Ellis and her three co-founders hadn’t intended to sell their beloved children’s label company Mabel’s labels, but when one of the largest companies in their space made a $12 million offer, the four co CEOs decided it was time the business structure of four co-founders with equal decision making power was starting to feel too slow for the rapidly growing company Julie told us in an interview, yeah, that makes total sense to me. For people making decisions is a lot. Plus, after 13 years of pouring all their resources into building the business, the sale would provide each of them with a nice nest egg for retirement. There comes a time when getting your money off the table starts to look pretty appealing. She said the timeline was aggressive less than six months from the first talks to the closing date, but the acquirer checked the boxes. 

Julie and her co-founders wanted checked. They were Canadian owned and would let Mabel’s labels keep running on its own rather than dismantling and absorbing it. It seemed like the perfect situation, but Julie quickly learned how exhausting selling a business could be. The exhaustion only grew as she went to work for the acquirer immediately after the sale and realized that the marathon finish of the acquisition was actually the starting line for a new kind of race. Six months after the sale closed, she left the business. She thought she would never leave exhausted and uncertain about her next direction. As entrepreneurs we’re always climbing for a pinnacle, Julie said, but there’s always another pinnacle after the first one and another one after that, and many entrepreneurs fall into the trap of dismissing or diminishing their accomplishments. We have an inability to find a plateau and rest on it. 

For a little while, said Julie. For Julie, the exit was a vast plateau. It should have felt like a victory, an opportunity to rest, but her entrepreneurial mindset was trained to keep pushing for the next accomplishment. Sitting on that plateau sparked an avalanche of new questions. Is this the best I will ever do? What will happen next? Was it a mistake? Even when an exit is going smoothly? The untold story is that many founders experience a significant mental implosion during and after the process. It’s possible for something very good to happen while still feeling a lot of emotional turmoil or conflict. These emotions can coexist. Talk to anyone who’s had a baby gotten married or started their dream job, and you’ll often hear that the joy was accompanied by a sense of inner disorientation. Exiting is an emotionally tumultuous event and it’s worth taking the time to prepare your mind as well as your business. We are not trying to scare you, but time and time again entrepreneurs have said how surprised they are that selling their company is so hard. If you go into it with eyes wide open to the challenges and armed with strategies to get through them, you’ll be miles ahead of someone who’s going into it with the magical thinking of signing some documents that yield a personal bucket of money and a room full of elated employees, friends and family members. So let’s start by digging deeper into the psychology of what makes this process so difficult.  

Rob Walling:
Hiring senior developers can really move the needle in your business, but if you bring on the wrong person, you can quickly burn through your runway. If you need help finding a vetted senior results oriented developer, you should reach out to today’s sponsor lemon.io. For years, they’ve been helping our audience find high quality global talent at competitive rates, and they can help you too. Don’t just take my word for it. Listener. Dylan Pierce had this to say about working with lemon.io. The machine learning engineer they helped me hire was very professional and even learned a new tech stack to set up an environment to train and deploy machine learning models. He documented his work clearly so I could train it in the future with additional data. I’m super happy with the results and longtime listener. Chaz Yun hired a senior developer from lemon.io and said his higher quote, definitely knew his stuff, provided appropriate feedback and pushback and had great communication including very fluent English. He really exceeded my expectations. Chaz said he definitely used Lemon IO again when he’s looking for a senior level engineer to learn more and get a 15% discount on your first four weeks of working with a developer head to lemon.io/startups. That’s lemon.io/startups. 

Your business is your baby. Entrepreneurs are deeply connected to their businesses and a study of entrepreneurs, emotional experiences and neurological activation. Scientists used functional MRIs while asking entrepreneurs to think about an image of their business. They conducted the same experiment with parents asking them to think of an image of their child. When comparing the brain activity of both groups, they found remarkably similar activation patterns. Specifically the study showed that activity was suppressed in regions of the brain involved in critical assessment. Specifically, the study showed that activity was suppressed in regions of the brain involved in critical assessment, while it heightened in areas associated with the brain’s reward center. In real world terms, this means that entrepreneurs and parents experience a similar sense of delight and satisfaction when thinking about their beautiful, perfect, above average children or businesses. Whether we’re thinking about our children or our businesses, our perceptions are not entirely objective. Both entrepreneurs and parents tend to view their subjects with a positive bias rather than objective clarity. Running with the parent analogy, you may rationally understand that your relationship with your children will change as they mature. You may also know that the goal of parenting is to raise autonomous independent individuals who do not live in your basement. 

Our 8-year-old moved out, went to college and currently lives in our basement, so this one hits a little close to home.  

Dr. Sherry Walling:
Whoops, we might not be very good at this.  

Rob Walling:
You may even be emotionally ready for your 18-year-old to leave home to preserve everyone’s sanity. However, understanding this doesn’t make the transition any less emotional or challenging. It’s not so different with a business. If you’ve built it well, there will come a time when the business outgrows you, but neurologically speaking, entrepreneurs often don’t perceive a clear separation between themselves and their businesses. This means that no matter how you pride yourself on being, it’s incredibly difficult to see yourself and your business objectively during and after your exit. When you commit so much of your time and energy to the formation and growth of a business, it is perfectly natural for the business to become an extension of your identity. You intertwine yourself and the business and other people may see you and the business as intertwined. Those years of intertwining get unraveled in an exit, A topic we’ll explore in the latter half of this book, there are psychological pros and cons to thinking of your business as your baby. Generally speaking, it isn’t a great idea to tie your wellbeing to an external entity that is highly vulnerable. Just social media algorithms or the supply chain from China. Too much of your identity is wrapped up in things you can’t control, but regardless of whether or not it is optimal, the neural imprinting between a person and their business is substantial and consistent.  

Dr. Sherry Walling:
Another reason it’s difficult, you’re entering the unknown. Businesses tend to grow slowly. You have the seed of an idea and then spend months or years on your own building it into something people want. You create your team slowly refining your product and growing your company until you suddenly look around and realize you have 20 people working for you. And then in a move that can feel like it happens overnight, you begin an exit process. You find yourself in a new location, a new world. The sudden shift is disorienting to say the least.  

Rob Walling:
Here’s a quote from a post exit founder. As a first time founder, it’s scary. Giving up a business is going well and recognizing whatever good fortune that allowed you to thrive might not be repeatable.  

Dr. Sherry Walling:
It’s not just the suddenness of an exit that’s disorienting. It’s also the potential loss of your identity, direction, and purpose. Returning to psychology, if you consider the typical progression of human development, we see rapid changes in our early lives. We try on adolescent identities, a jock, a punk, a goth. Oh yeah, I like the breakfast club. We leave home for college, perhaps switch our career paths a few times. We enter into and leave intimate relationships. We establish ourselves professionally. We purchase homes and couches to cats in a fish tank. We might have children. We start companies. As we age, the rate of these life-changing events slows down. We can no longer move apartments in one afternoon with our cousin’s pickup truck. We grow comfortable with our stable lives and identities. Mature adulthood means that generally we know who we are and how our life operates, and then we face an exit and we’re thrown into the unknown once more because of the depth of the relationship between the entrepreneur and the business. This is not a casual unknown. It is a deep unknown, a fairly comprehensive recalibration of who we are and how our life works. Most dramatic life-changing events that happen in the middle of adulthood are traumatic, like a car accident, a divorce, the death of a parent. What comes after the can be daunting. The exit creates instability and unpredictability, and after years of leading and directing the path of your business, it requires you to surrender control. It can feel like going backwards.  

Rob Walling:
Here’s another quote from a post exit founder. It’s not often as a 43-year-old, I have a major life decision. Most of what we want at this point is predictability, and the uncertainty of what comes after this is daunting.  

Dr. Sherry Walling:
It can feel like you’re 18 again and wondering what the hell you’re going to do with the rest of your life.  

Rob Walling:
On top of all that, going through an exit is incredibly isolating. Think of it like an iceberg. The tip of the iceberg is the public perception of what you’re going through. Everything below the water is what you’re actually experiencing from the perspective of your employees. Team members and the public exits are seen as times of celebration. Pop out the champagne and the celebration emojis because now you’re a millionaire, right?  

Dr. Sherry Walling:
Which is the celebration emoji.  

Rob Walling:
There’s a confetti one, and then there’s one that looks like a bullhorn with confetti around it. I think if you type in colon confetti, oh, that’s in slack anyways,  

Dr. Sherry Walling:
Alright,  

Rob Walling:
And while that’s partially true because getting millions or tens of millions of dollars wired to your bank account is a pretty incredible moment, that’s only the tip of the iceberg. The rest is an incredibly nuanced experience that the founder goes through alone. You’re trying to make the best decision for yourself and your business processing a complicated multivariate analysis in your head, and often you might be legally barred from talking about what you’re working on. When I sold Drip, I experienced a barrage of congratulations. While mentally I was almost at my breaking point. This created a deep sense of disconnection because it was nearly impossible to talk about the realities of the exit due to non-disclosure agreements or NDAs and the dearth of people who could relate to my experience. Exiting is a low frequency event. There just aren’t that many people who’ve done it. Many other major life transitions are universal puberty, completing high school, choosing a life partner, pregnancy, the death of a family member, a child departing home and aging. They’re challenging shifts, but almost everyone has experienced them. There’s plenty of collective wisdom and guidance available to help you navigate these difficult transitions, not so with an exit. It’s a pretty small club and you have to work hard to find commiseration guidance and support as you enter this unknown territory  

Dr. Sherry Walling:
And there’s no blueprint. Another factor that adds to the feeling of isolation is that there’s no blueprint. Exiting is like a fingerprint. No two look exactly the same. As we mentioned, exiting is a low frequency event. It’s also a high variability event, which means that even the few other people in the world who have gone through an exit haven’t gone through your exit. If you and I both decide to sell our houses today, there’s a relatively standard process to follow. It’s a high frequency, low variability event. Sure each home is unique, but millions of homes are sold around the world each year. Even if you haven’t sold a house before, you probably know a dozen people who’ve been through the process and there are standard templates you can follow selling a business. On the other hand, each experience is unique. Maybe you’re part of a mastermind or run in entrepreneurial circles and even have other friends who are founders, even if that’s the case, and even if some of them had gone through their own exits, the chances that someone has gone through your exact scenario are very low. No one can hand you a blueprint for exiting your business. The number of variables is just too great and there’s never one right answer. When selling your company, your hand sketching your blueprint while the backhoe digs the foundation  

Rob Walling:
And all that got you here, won’t get you farther exiting well requires a new set of skills. During the course of running your business, you’ve learned how to build, how to sell your product, how to market, how to lead your team, how to build a profitable company. None of those skills apply to what you’re about to do. In fact, the main drivers that got you to this point, your passion for your product, your commitment to your team, your dedication to your business can stand in the way of a successful exit. Many entrepreneurs have difficulty making clear decisions during a sale because they care so much about their team and their business. You’ve spent years or decades building something incredible and developing the passion to run it. After all, everyone’s got the cutest baby right now. Not only do you have to go through one of the most difficult and isolating times of your life without a blueprint, but you also have to unlearn old habits and teach yourself a brand new set of skills  

Dr. Sherry Walling:
And it’s irreversible. If you hire the wrong engineer, you can fire them and find a better fit. If you develop a feature that turns out to be a dud, you can always scrap it and try something new. If you invest in a marketing approach that turns out to be a waste of money, you can also change course. Those are reversible decisions. You can make them relatively quickly without too much stress. Exiting your company though is irreversible. Sure, we’ve all heard of people who repurchased a company after they sold it, just like we’ve heard of couples who got back together after a divorce. But both situations are pretty rare. Because of this, it’s not a decision you should make quickly. It should stress you out. You should spend a lot more time thinking about it than you did thinking about who to hire for that engineering role. The decision is irreversible, so you should make damn sure it’s the right decision, except  

Rob Walling:
You can’t see the future, which means there’s absolutely no way to know if you’re making the right decision. All you can know is that you’re making a decision, which is hopefully the best decision you could make with the data you have. You can run various calculations and imagine what life might look like if you continue to grow the business for another 20 years versus selling it now and walking away with a specific dollar amount. However, you can’t actually know how any of these scenarios will ultimately turn out. We know founders who wish they hadn’t sold, founders who felt like they sold for too little, and founders who declined an offer that in retrospect was a once in a lifetime deal. There are many potential scenarios for regret. With the benefit of hindsight, they might have made a different decision. None of us can see the future though. The only thing you can do is make the best decision you can with the information you have right now.  

Dr. Sherry Walling:
So now let’s shift to six factors that shape how you feel about an exit and our experience working with entrepreneurs. Six factors strongly predict the emotional process of an exit. So we’ll discuss these factors throughout the book. The first one we want to talk about is motivations. The reasons behind your decision to sell the company significantly impact how the process will affect you mentally. Are your motivations purely financial? Are you seizing of lucrative market opportunity or strategic acquisition? Are you feeling called to shift into different or more meaningful work? Are you selling off one product to concentrate on the success of another, or are you selling somewhat reluctantly due to unexpected life changes, burnout, fatigue, or depression? When you understand your motivations, it helps clarify what a successful exit looks like for you regardless of your situation. It also helps you gauge the emotional reserves you have available for the exit process. Beginning an acquisition process while experiencing burnout is like running back-to-back marathons. It’ll be highly emotionally challenging. It’s crucial to be aware of your energy levels and core needs as you navigate the process.  

Rob Walling:
The second factor is tolerance for uncertainty. If you started a business, then tolerance for uncertainty is your bread and butter. But as we’ve mentioned, the level of stress and uncertainty during the exit process is a whole new ball game. Founders who have a high tolerance for uncertainty will have an easier time during their exit, but even if that’s you, it will require all of your coping skills to rise to the challenge. It’s worth assessing those coping skills. Now, take stock of the ways you tend to deal with uncertainty, both positive and negative, and create a plan for implementing or mitigating them during your exit.  

Dr. Sherry Walling:
The third factor is good old fashioned stamina. Exits take longer and are more complicated than anyone imagines at the outset. Even if you have a fantastic strategic buyer and the purchase price is agreeable and the details seem to be lining up, it always takes longer than it should. There’s a lot of paperwork. There are many people, employees or customers who need to be brought along strategically with thoughtfully crafted information. Pace yourself and prepare yourself mentally to run a marathon.  

Rob Walling:
The fourth factor is team psychology. The way an entrepreneur views their team is another critical factor. What is your relationship like with your team? Do you see them as family? Are they literally members of your family, friends from high school? Are they a curated workforce that you’re paying to do their jobs? How do you see responsibility to them when you’re setting yourself up to exit? Hopefully with a nice pile of money, your existing relationship with your team will significantly impact how you feel about exiting.  

Dr. Sherry Walling:
Number five, identification with the business. How closely do you identify with your business? Whether you built it from scratch over decades or have been running it only a few years? At least part of your identity is probably closely tied to your company. As you consider your exits important to find meaning and engagement in other areas of your life, your hobbies, family, community, and other passions. Exiting a company can feel like cutting off a limb, but founders who have found a meaning in other parts of their lives tend to have an easier time. The earlier in your business journey that you begin to separate yourself from your business, the better for you and for your business. You may want to ask, how well can this business run without me? The business may be more valuable. It almost certainly will be more valuable if it isn’t tied to you and you are healthier pre, mid, and post exit. If your sense of worth as a human being isn’t intertwined with your business.  

Rob Walling:
The six factor is a sense of what’s next. It’s easy for a founder to get so wrapped up in the exit process that they’re not thinking about what comes after. However, it’s healthier to start thinking about future plans and gently engage with those plans as early as possible. We use the word gently because rushing into a plan to offset the uncertainty can be problematic. Instead, approach it with a sense of exploration. Gently noodle through ideas. Don’t solidify them by pouring concrete. The question of what’s next can either haunt you throughout the exit process or serve as a north star that guides you into the next phase of your life.  

Dr. Sherry Walling:
So at the end of each chapter, we decided to make these little sections called making it real, and in ’em they’re kind of like practice assignments. These parts of the book where we want to translate the content of the book to something that you can actually use and apply to your life. So for this first chapter, the Making it Real section says, start your exit journal. Grab a notebook or open a password protected document and write down what a good exit would look like for you in this exercise. Practice active imagination. Close your eyes and imagine your last day at your company. Imagine some last act like locking your office door, closing your laptop, offering a goodbye hug to one of your team members. In your imagination, examine yourself. How old are you? What is your emotional state? How do you feel about this ending, this last act? And now let’s jump scenes. Imagine you are telling an old friend about the last day at your company. Imagine that you are happy, proud, satisfied that your exit went exactly as you’d hoped. What’s the story that you tell them? Who was the acquirer? What was the sale price? Where are you taking your loved ones for a celebration? Now, begin to imagine yourself in this scenario. It is one way to practice a not yet experienced reality,  

Rob Walling:
And we wrap up chapter one with a sidebar titled, think About Your Exit Before You Get Started. Ideally, you’ve been thinking about your exit since day one. A good exit strategy is like a prenup in a marriage, especially if you have a co-founder,  

Dr. Sherry Walling:
Hey, do we have a prenup?  

Rob Walling:
No, our net worth was like $8,  

Dr. Sherry Walling:
But I had a guitar.  

Rob Walling:
That’s true. $8 plus a guitar. Entrepreneurs who have never thought about it usually find themselves blindsided three, five or 10 years into a business when life circumstances change, they get tired of the business or they get an offer with a shocking number of zeros. Everyone exits. If you don’t plan for it early enough, you’ll find that your business isn’t prepared to go on without you once the day comes. And if you don’t think about yourself exiting, you’ll be emotionally jarred when you find yourself pondering. Now, what do I do with myself? In your mind? Begin to see an exit as a universal stage in the lifecycle of any entrepreneur. Make it the assumption, the default setting, not to get too dark about it, but a helpful analogy is thinking about exiting your business, like making sure your affairs are in order for the end of your life.  

Dr. Sherry Walling:
That is dark, dude. Nobody’s going to die.  

Rob Walling:
Nobody’s going to die.  

Dr. Sherry Walling:
Oh wait, whoops.  

Rob Walling:
People are depending on you to leave your business in good shape. If you suddenly need to leave, there’s no way around death. Taxes and exits. Have an ongoing open dialogue with yourself and the relevant people, even if it’s just a password protected document where you can jot down thoughts and explore your exit ideas from time to time. Whether or not you can visualize the end of your relationship with your company, start having that conversation with yourself today. Don’t wait until you’re forced into it without having enough time to think and plan. You might miss an opportunity because you were unprepared to seize it, and definitely don’t wait until you’re in the middle of stress and burnout to make some of the most important decisions of your business life. Though, if that’s you, we’ll walk you through that process too.  

Dr. Sherry Walling:
Hey, good job reading.  

Rob Walling:
Yeah, you too.  

Dr. Sherry Walling:
You read. Good.  

Rob Walling:
Thanks for joining me on the show. I know I grew up reading and writing and arithmetic and  

Dr. Sherry Walling:
Speaking English.  

Rob Walling:
Speaking English. Well, thanks for joining me on the pod here.  

Dr. Sherry Walling:
My pleasure. Thanks for writing a book with me.  

Rob Walling:
How’d it feel reading that first chapter? We have not read the book out loud. It really well.  

Dr. Sherry Walling:
I just gave a talk about the content of the first chapter, so I didn’t read the book, but I actually used some of the language verbatim, so I felt like, oh, I’ve have actually read this out loud before.  

Rob Walling:
Did you just say I haven’t read the book, the book that we wrote?  

Dr. Sherry Walling:
No, I haven’t read it out loud.  

Rob Walling:
Oh, got it.  

Dr. Sherry Walling:
I’ve read it multiple times.  

Rob Walling:
Like proofreading. Yeah,  

Dr. Sherry Walling:
Yeah. But I have not read it out loud. It’s not been the book that our children have requested for their night night pre-B bedtime story being as they’re 18 and 14.  

Rob Walling:
I think it felt good. It holds up. It’s always a different experience reading something out loud.  

Dr. Sherry Walling:
Yeah, I mean, other times that I’ve done this, I’ve really wanted edit things as I’m reading it, it feels clunky or like, no, that’s not how I want to say that. But I made a few little wording adjustments as I was reading, but generally speaking, I think the writing is quite good.  

Rob Walling:
Yeah, I’m the same. Every audiobook I’ve ever read, I have made edits to the manuscript as I’ve been making it because there’s just certain things that you find are clunky or I believe in the very read through the SaaS playbook, there was one sentence where it was missing the word not, and so I said the exact opposite. It was probably something like, you should definitely do B2C or something like that, and I was like, what has to be not, I cannot print this book. People think it’s an April Fool’s joke. So anyways, thanks for joining me on the show. Folks want to learn more about the book, where do they go?  

Dr. Sherry Walling:
Exit strategy book.com.com.  

Rob Walling:
See you next time.  

Dr. Sherry Walling:
Peace.  

Rob Walling:
Thanks to Sherry for joining me on the show today, and thank you for joining me this week in every week. This is Rob Walling signing off from episode 743.

Rob Walling:
Welcome back to Startups For, the Rest, Of Us. I’m Rob Walling. I’m on a solo adventure today and I’m going to be covering topics ranging from normalizing, doing hard things about just getting used to doing hard things about how bisons walk into storms. Not sure if you’ve heard about this, but it’s an interesting adaptation they’ve developed over hundreds or thousands of years, and then about making it work, making it right, and making it fast. Before I dive into that, the Kickstarter for my new book Exit Strategy, the Entrepreneur’s Guide to Selling Your Business Without Regret is Live and it closes next week on December 12th. You can head to the link in the show notes or you can go to kickstarter.com and search for exit strategy. The book is 260 70 pages of all the knowledge that my wife, Dr. Sherry Walling, who is a founder and executive coaching consultant and myself have gathered over the past couple decades of working with entrepreneurs, advising them, investing in them and having had an exit or two ourselves. 

So you can head to exit strategy book.com and also get a link to the Kickstarter there. It would mean the world to me if you’d back it. And also I think that everyone, whether you’re just starting out or whether you’re thinking about exiting or in the middle of exiting, can use some mental support, psychological support and really learn from not only Dr. Sherry and I, but the 15 or 20 entrepreneurs who have exited that we interviewed for this book. So I’m really proud of what we put together and I think for $30 it’s quite this steal in terms of the amount and the quality of the information that you’ll gather from it. In addition, MicroConf mastermind applications close on December 4th. You’ve heard me talk about Mastermind’s ad nauseum on this podcast about the tremendous impact that they’ve had on my entrepreneurial career, not only in the moment, but just keeping me going for the past couple decades. MicroConf masterminds.com if you want to get matched with like-minded founders who are bootstrapped and mostly bootstrapped but ambitious and looking for accountability, friendship, comradery, and frankly just looking to not feel so alone. So that’s microcom masterminds.com. 

Let’s dive into my first topic of the day. I want to tell you a story about a trip that my track team took to Hawaii in high school. I think I was a junior and this was a big deal. None of us had ever been to Hawaii and we went out there to compete in an invitational type thing, but we had to do fundraisers and such to afford the tickets and all that. And while we were out there one day, my coach was driving the rental car back to the hotel and the hotel was surrounded by, I think it was all sugar cane if I recall correctly. And there was this long road, of course it’s Hawaii, so there’s a mountains on this side and a beach on this side and just this amazing vista. But he’s driving back to the place that we were staying at and he sees one of the distance runners running the other direction running away from the hotel, and he’s just kind of trotting along and his name’s Brian. 

And so coach pulls up and he says, Brian, where are you going? And he says, I’m running down to this convenience store to get ice cream. And the coach says they have ice cream back at the hotel. There’s a refrigerator thing where you can buy it in the lobby. And Brian says, yeah, but they don’t have chocolate chip. And my coach told that at the end of year event, the reception where parents get together and talk about track and give people awards and all that, and I got a huge laugh from all the parents because the convenience store was a couple miles from the hotel and us track athletes. We looked around. I don’t get why that’s funny, and I get the joke now. It’s that wow, as an adult would you run two miles in order to get a thing of ice cream that is the flavor that you want? 

And most of the time, no you wouldn’t. But the thing was is when you’re running at that level, we were competing at a pretty intense level. I’ll say I wound up, I’ve talked about this, but I wound up breaking the school record in the hurdles and that record lasted 31 years. It just got broken this year about four months ago. So we were not dabbling in track. We were very, very intense about it, and as such, we had normalized doing hard things. There was such second nature that most of us didn’t get the joke when the coach told that story at the end of your reception. And the thing about it was our workouts were a mile warmup. Then you do some stretching and then you do a pretty intense workout of sprints and intervals and you’re dying at the end and then you do another mile cool down, you stretch and you leave. 

And that’s just what we did five days a week, sometimes six days a week. There were obviously days when I threw up once a week during the fall for a few months As you’re getting into shape, it’s just so intense and that was just what we did. We would groan when they would name a particularly hard workout, but we all showed up and we all did it, and the people that performed it was just expected that if we wanted to do great things, we had to do hard things and usually we had to do the hard things first. It was getting in shape and it was working on our technique and it was sometimes running ourselves to the point of throwing up, unfortunately, but in the end of the season when you’re trying to qualify for regionals and the state meet, you were thankful that you did the hard things in the early days, and there were some folks that came to the first month or two of track and it was hard and they said, you know what? 

This isn’t for me and that’s fine. It was a way of I guess weeding folks out and really only having those that cared enough to do the hard things that were really committed to the long-term vision because talk about delayed gratification, and I guess I should clarify, in high school it was only about, was it maybe five months? So it was probably from January to June you started working out and then you had the state meet in June in college was when there was fall workouts, and that went all the way through June, so it really was a full nine months or so of doing hard things, so to speak, and you kind of did it every day and got used to it. The reason I’m bringing this up, of course, in the context of startups is a lot of the founders that I see succeeding if they’re not relying on luck and they are the ones who are executing and building skills and putting in hard work, it’s just expected that you’re going to have to do some hard things. 

And sometimes that hard thing is digging into marketing approaches that don’t work right away or maybe that you’re like, I don’t really want to do that. Do I have to do SEO? I don’t really want to do the ground. I don’t want to do sales demos. I don’t want to focus on one product and push that boulder up the hill. I don’t want to try to run ads. That doesn’t sound interesting. The way my mind works is I really want to build a media company. Well, I just start a YouTube channel and be on Twitter and tweet about things and have that build my business. I don’t want to hire people. I don’t want to have to fire people. I don’t want to make the hard decision of having to focus on one thing. I don’t want to do b2b. That sounds boring. I want to build a two-sided marketplace. 

I’m not saying that’s not hard, that’s actually doing it on hard mode, but you get the idea. I get emails to this podcast about I have a good day job and I’m making good money, but I really want to be an entrepreneur, but I just have a tough time getting motivated. And I think to myself, then you don’t really want to be an entrepreneur and that’s okay. That’s okay. Just know that if you’re going to do this, you have to do hard things. I was in conversation with someone who had sold their company for nine figures, so that’s hundreds of millions of dollars. And one of the things that he does is talk to other founders who have exited for never have to Work again, money. I call it sunset Money. You can ride off into the sunset. Some people call it FU money, and that’s fine too. 

It’s all the same. And he said one of the big things he encounters, and this is similar when I have these conversations with folks, one of the hard things is if you sell your company for whatever that number is for you, maybe it’s 5 million for you, maybe it’s 10 million, maybe it’s 50 million. You sell your company, you’ve been grinding, you’ve been creating, you’ve been building, and you have all this money in the bank, and it’s really hard to figure out what to do next. That’s meaningful, but not so hard that you’ll just give up because when you have that much money in the bank, why do hard things? What’s the motivation anymore? So many of us had the motivation to build these companies of I want to build interesting things. I want freedom. I want to be in charge of my own time, and basically that means I have to get rich in order to do it. 

But that becomes a motivation for a lot of people. It’s not to get rich. It’s the freedom, right? It’s the ability to build and work on and do whatever you want for the rest of your life, and that is an amazing place to be in. Now the challenge is your motivation to stick through the hard times and to do really hard things like the mile warmup, the mile cool down, and the really hard workout in between or to grind for months and months on SEO or ads or focusing on a product, trying to find product-market fit, and staying up at night thinking, am I ever going to find product-market fit, dealing with an employee who doesn’t work out and you have to fire and rehire. There’s all these things that are difficult, that are challenging and finding that motivation, whether you have enough money to make to never work again, or whether you don’t and you just want to be an entrepreneur, but you don’t feel that drive enough to push you to want to do really hard things. 

It’s a challenge. And so I tell this story about Brian running two miles to a convenience store to grab chocolate chip ice cream. He did return with chocolate chip, by the way, and there were a couple people that wasn’t just Brian who wanted it. There were some parents or something that wanted chocolate chip, and when he went, he walked out in the lobby and they didn’t have it. He just took off. He didn’t even go back and ask him. He just left and ran a four mile round trip to get chocolate chip ice cream for these other people. So I hope that anecdote has you thinking about the hard things that perhaps should be normalized in your day today. My second topic for today is a fun fact. I heard the other day, and then I confirmed it with not only chat GPT, but with Google as well. 

And it’s about how a pack or a herd, technically speaking of bisons, if they see a blizzard coming or a storm, they will walk into the storm because they know that whatever direction the storm is headed, it will go by faster if they are moving into that storm. And think about that, there’s some type of really deep adaptation that has gone on there because I think for most of us, we don’t want to walk into the storm and most animals will run away from a storm or from danger or from something that is perceived as uncomfortable, but the bison knows that if they take this big challenge head on, it will be over faster. Hopefully. The parallel to running a startup is really obvious. What are the storms? What are the blizzards that are coming at you? The lack of product-market fit, the lack of growth, impending competitors that are going to eat your lunch. 

Ai, a rapidly changing landscape. Folks who can spin up a similar app to you in a week now because of copilot or cursor AI or all these coding tools, people building stuff with no code that is purpose built and perhaps solves a need better than your custom app that you spent years building can. So what do bison know that we don’t? Well, they know that if you ignore a threat or if you walk sideways or away from it, you’re just going to experience it longer. It doesn’t actually fix anything. And you as the startup founder or an aspiring startup founder, I think would be well-served to figure out what are the big things that make you uncomfortable, the things that stress you out, the things that keep you up at night. And instead of trying to ignore them, trying to run away from them, trying to hide from them, think about how can I attack this head on? 

Whether this is someone working for you who just isn’t quite working out and you let it go way too long. That’s a very common thing. The startup founders do. All of us do it at one point or another in our careers and all of us come to regret that decision of ignoring it is not a threat in this case, but I mean it’s a threat to our growth. It’s a threat to our business. It is just a hard thing that’s easy to ignore. Another hard thing is lack of growth, and your R is not going up into the right. Do you make excuses? Do you blame the internet? Do you say, oh, startup advice doesn’t work anymore? Well, in 2024, it doesn’t work the way it used. You used to just be able to do SEO content and AdWords and everything would just work out, and it was so easy, which in fact it wasn’t. 

But you convince yourself of this because you’re not having success, or is it hard and you need to figure out which direction to head and you need to persevere long enough and normalize doing hard things. Ooh, see the way I integrated those two but normalize running the four mile round trip to get the chocolate chip ice cream in order to face these things that are difficult. If you’re always running away or ignoring or making excuses or acting like these hard things don’t exist, you’re not going to find success. I can’t think. Now, maybe there’s an exception, but I can’t think of a single entrepreneur that I have worked with, advised, been around, invested in, and I’m invested now in, I think it’s 212 B2B, SaaS companies can’t think of a single one that has achieved success. And we can just say, what is that? I dunno. 

Seven figure and up a R seven figure eight, figure a RR. Can’t think of one that ignored these hard things that didn’t accept their current reality, even if that reality was not what they wanted to hear and didn’t make a game plan a, plan a, plan B, a plan C of how to deal with and address it. I’ve known founders, multiple founders that have received cease and desist letters. I know multiple that have been sued. I know many that have been threatened to be sued. I know several that have been hacked where their app has been hacked. There has been ransom situations where I’m going to release this on the dark web if you don’t pay us X amount of Bitcoin. I’ve seen embezzlement, I’ve seen employees rogue. The list goes on and on, and whether it’s any of those or whether it’s something as simple as, oh, hey, we’re not growing, and that’s the storm, that’s the coming storm is that if we don’t grow for too much longer, we’re done. 

We either have to lay everybody off or the app itself. We just need to shut down the company. That has to be the hard reality that you face on a day-to-day basis. And I am not trying to paint entrepreneurship as this terrible hard thing. You have to work 60 hour weeks all the time and be stressed. That’s not how it should be either. If it’s that hard, either you’re trying to build a billion dollar company or maybe your approach isn’t quite right, or frankly, maybe you’re running into some bad luck, but it doesn’t have to be hard all the time. I just want to level set for you listening that there will be ups and downs and when the ups are here, celebrate them. And when the downs are here and the difficult times are present for you, realize that that is part of this game. 

That is part of being an entrepreneur and learning and being willing to face those hard things head on is something that I wished I had learned sooner, and if only I had learned this tidy fact about bisons walking into storms years ago, perhaps I would’ve been better equipped. And that’s what I hope to convey to you here today. So I hope you continue your entrepreneurial journey a little better equipped to do so. My last topic for today is about first making it work, then making it right, then making it fast. And this is a quote or a paraphrase from the Comic Lab podcast that I have quoted in or paraphrased several times in the past. You can go check it out if you’re interested. But the co-hosts I find are very practical and pragmatic and the number of parallels between being an independent comic artist, which is essentially being an entrepreneur and making money from your art. 

Now it is B2C, so it doesn’t necessarily fit in the focus of this podcast, but a lot of what they talk about I find has parallels in the startup space and specifically in the bootstrapped and mostly bootstrapped SaaS space. So one of the hosts, Brad had this quote. He said, first, make it work, then make it right and then make it fast. And the context he was using was about art, was about drawing or writing frankly, anything that you would do to produce a comic strip or a comic book or a web comic and about how when you’re just starting out, just learning to draw or learning to write and be funny is hard. And so it might take you, it probably will take you years just to make it work, but you’re going to be really slow at it and it’s not going to be that good. 

So then the next step is you’re not that good at it, but make it good. That’s the making it right step. So I think it’s like make it work, then make it good and then make it fast. But he says make it right. And I can say that, look, it’s his phrase. He can name it whatever he wants. So first step is to make it work, then you make it right and then over repetition, you make it fast basically. And I actually like thoughts or frameworks or statements like this that make me think, oh yeah, that’s totally obvious, but I didn’t say it. I haven’t heard it phrased this way this succinctly before, but I think the parallels run deep. I think this podcast, if you go back and listen, the first 20 or 30 episodes, maybe 40 or 50, we’re just trying to make it work. 

And we did shipped every week. There were a couple months where we shipped every other week, but you get the idea over the 14 year lifespan of this podcast and the 742 episodes, the first 20 to 40 were making it work the next, I don’t know how many were making it right? And then eventually we got to the point and later me on my own got to the point where I can record these really fast. That took repetition. That didn’t happen in the first a hundred episodes. The fast part was probably in the second hundred or maybe the third a hundred, frankly, these solo episodes. I didn’t start doing these until several hundred in, and those were excruciating and painful at first, and then through repetition, I made them write and made them fast. Same thing. If you’re writing and giving conference talks, your first one’s not going to be that good. 

You got to make it right. And then over time you get better. To the point where I’ve given talks that I have literally built the slides four days in advance and run through the talk once, and then I get up on stage. And that’s just pure repetition because the first talk I gave, I was working on weeks and weeks in advance, and I was practicing over and over because I didn’t know how to do it well, and I didn’t know how to do it fast. It’s the same thing with sales demos. First time you do it, it’s not going to be very good. You’re going to be super nervous and you’re going to potentially over prepare, spend a lot of time on it, and then over time, over repetition, you make it so it’s good. The making it fast maybe doesn’t apply here, but I do think maybe making the deck for your sales demo applies, right? 

That you would get better a second time building a deck for it. Marketing approaches similar. First you just kind of stumble through and you don’t know what’s going to work, and eventually you make something work just enough that it keeps you alive for another month and then you start getting better at thinking strategically and about thinking like a marketer. And then eventually you get to the point where you can spin up new marketing approaches. I’ll say quickly, right? That’s the fast part. Now the analogy doesn’t necessarily hold up. It’s not a piece of art. And so thinking that you can spin up five or six marketing approaches just because you’re good at it isn’t reality in most situations. Most companies don’t have that many, but you get the idea. You do get better at moving fast and doing a lot of things. A r and I talk about the most successful founders across the tiny C portfolio of 192 companies are those founders that do a lot of things relatively quickly. 

They put a lot of things into the world, and they’re right enough of the time. And Ruben, the founder of Sewell, mentioned to me that he liked that analogy, but he felt like I was leaving something out. When I say that the founders who do a lot of things and are right enough of the time, and I think enough is 50, 60, 70%, it’s somewhere in there and there’s asymmetric upside when they are right? But Ruben was saying, yeah, but even those founders, one of ’em for sure, even those founders that do it, they’re not necessarily right immediately out of the gate when they try a new thing. Usually it’s off a bit. And every approach needs to be honed unless you get really lucky, you launch a new sales effort, a new marketing effort, a new landing page, a new feature, a new product. 

You hire someone new, there’s a certain level of refinement, maybe some experimentation, but of putting something into the wild and realizing, oh, that’s not quite right, and I need to tweak it according to my founder gut and according to the taste that I have in my mind of what a landing page should look like or what a feature launch should be or how a marketing approach should be executed, I’m going to take the signals that I’m getting back and there’s a feedback loop and I’m going to iterate, I’m going to tweak. And then eventually, you’re right enough of the time. So don’t think that right out of the gate, founders who are doing exceptionally well are just right all the time, but you do build your founder gut. I use this phrase all the time, and the editor for the SaaS Playbook was like, that’s not a real thing, and it has to be founder’s Gut, right? 

It’s a possessive that the founder possesses this gut instinct. And I was like, I guess, but almost it’s like capital F, capital G, it’s like founder gut. It’s a thing that I name of over time, you can develop this. Some people probably have it from the start. I think like Jason Cohen Heat and Shaw probably Dharmesh. There’s some people that I know David cancel that at least as I saw them going on their journey, they just seemed from the start to kind of know what they were doing and to generally work on the right things with asymmetric upside ship, a lot of things really smart people. I was not that I was stumbling around blindly for years and years in my twenties and early thirties, not really knowing what I should be working on. And my founder gut was not great. And the way that I developed it was through people giving me advice. 

People that were ahead of me, watching people who have really strong founder guts and seeing how they made decisions. It’s just a refinement and a learning and an iteration of myself, a constant search for self-improvement. And part of that I’ve talked about on the show in the past, which is knowing yourself not having blind spots. We all have weaknesses, but a blind spot is a weakness that we’re not aware of. And so even taking the personality tests, the Enneagram and the StrengthsFinder and the Kolby A and there’s a few others, do those unlock everything and all the magic to make you a high performer? No, but they give you one more data point, and if you can read through the descriptions and say, oh, yeah, the strength side of this certain attribute is that I really focus on things and I really focus and get it done. 

And the shadow side of that is I focus too long and I spend years working on stuff that isn’t working. And knowing that about yourself goes a long way towards helping you improve as a founder and improving your founder gut. Now back to first making it work, then making it right, and they’re making it fast. I do see people try to skip this and they see much like in the stair step method, I often say, Hey, if you see folks that are playing in the major leagues and you haven’t played T-ball yet, you don’t want to go try to play in the major leagues right away. You want to play T-ball and then little league and then junior high ball and high school ball, college ball, minor leagues, major leagues, right? There’s a bunch of steps along the way, and I see folks, I guess it’s on Twitter, I hear ’em on podcasts, whatever, who see an entrepreneur that is 5, 10, 15 years ahead of them or someone who has assets that they do not such as, well, you have half a million Twitter followers and I have 500, but I’m going to try the same approach because that surely that will work. 

It’s like trying to jump to the end without putting in all the time to first make it work, then make it right, and then make it fast. I mean, what’s interesting about this phrase is just how much it does align with the stair-step method. It hadn’t occurred to me until right now as I’m saying this, it’s crawl, walk, run. Don’t try to run from the start. Don’t try to play major league baseball from the start. Don’t try to quit your day job and have a burn down of all your money. I had six months to launch a standalone SaaS and get traction. I’ve never done this before. It’s like, well, hold on. How about you make it work by just launching anything? And whether that’s a plugin in an app marketplace or an ecosystem, whether it’s an ebook or a course or whatever, just build enough of an audience or learn to market well enough or build enough of a network that you just get something out there and then get better at it, right? 

That’s the make it right. And look, that might take a few years. This is why I say think in years, not months. As an entrepreneur, as a bootstrap founder, especially think in years, not months, don’t be in such a hurry to get to the end result because then you’re trying to jump to the make it fast. And that’s where this ridiculous idea that I should spray and pray one thing every week. I’m going to launch 50 apps this year and just see what sticks. I’m going to see what’s going to make it work that’s wanting to get to make it fast and take a shortcut to get there and not do the learning and not put in the hard work and not face the hardest things that are the blizzard that is marching toward you. And I think people that are trying to skip the line and get there are doing themselves a disservice and are much less likely to be able to repeat it again in the future, are much more likely to need to rely on luck and are much less likely to succeed in the longterm and to be able to do it again, even if they do. 

Now, am I saying you have to grind it out and put in years. It’s like you got to go through high school and then you got to go through university, and then you got to go through, get your master’s and then your PhD, and then you got to work 10 years before you have seniority. So that’s just what we all did. And so you got to put in 20 years. No, that’s not what I’m saying. Obviously the beauty of entrepreneurship and what we’re all doing is you don’t have to take the same path that anyone else did. But I do see early stage folks making the mistake of thinking that they can just jump to the make it fast. They can just jump to that end. But if you can’t make it work and make it right, it doesn’t matter if it’s fast because you’re shipping something crappy, and whether that thing that’s crappy is a product or ebook or whatever it is, if it doesn’t work and it’s not right, what’s the point of trying to make it fast? 

I gave a talk after I sold Drip, and it was called 11 Years to Overnight Success, and it measured the time from launching my first little micro product wound up doing a thousand, 2000, 3000 a month until Sunset Money, right until selling Drip and never having to work again. And the title was Tongue in Cheek, obviously 11 years to Overnight success because people think this stuff happens overnight and almost without exception, or maybe without exception, it doesn’t, doesn’t happen overnight, crawl, walk, run. You stair step your way up, you first make it work, then you make it right, and then you make it fast. Thanks so much for joining me this week and every week on the show. If you keep listening, I’ll keep recording. This is Rob Walling signing off from episode 742.

Rob Walling:
Welcome to another episode of Startups For, the Rest, Of Us. I’m your host, Rob Walling, and in this episode I sit down with Wes Bush. He’s one of the key proponents of the product led growth movement as the author of two books on the subject, product led growth, how to build a product that sells itself and the Product Led playbook, how to unlock Self-serve revenue, and dominate your market with a tiny team. I wanted to have Wes on the show today because I think there are a lot of misconceptions and a lot of myths around what product-led growth actually is, and I wanted to talk with Wes, obviously one of the foremost experts on this topic, to really try to peel away myth from fact and really get to the heart of product-led growth, why you might want to consider it and when it’s a good idea when it’s not. 

Before we dive into our conversation, MicroConf Mastermind matching happens three times a year and it’s happening right now, applications close on December 4th, so just a week or two after this episode goes live. Masterminds have been critical to my development and frankly, my longevity as an entrepreneur, and I’ve been a proponent of them for probably 12 or 13 years. You can go to startups For, the Rest Of Us dot com and search for startup mastermind and find the first time that I ever mentioned it on the show. And it’s a long time ago because I became a believer in meeting with like-minded founders over time, a small group of founders who really followed my journey, almost like honorary co-founders. So if you’ve been feeling alone or isolated or lost or you’re just not sure what to do next and you need some accountability and someone else to be in the trenches alongside you, head to microcomp.com/masterminds. You pay a one-time fee, and we will match you up with other like-minded founders. And with that, let’s dive into my conversation with Wes West Bush. Thanks so much for joining me on the show. Thanks  

Wes Bush:
For having me. I’m excited to be  

Rob Walling:
Here. I’m excited to talk about product led growth with you for a long time. Listeners of the show, they know I have a love hate relationship with the term product-led growth because I like shorthand terms, even product-market fit, I feel the same way. It’s like, oh, if I say that, and we kind of both know what that means, it can be thousands of words encapsulating that. The problem is when I say product-market fit, if there’s 10 of us in a room, there’s 10 different definitions of it. And I feel like product-led growth is a bit like that and sometimes misused, especially by developers who just want their product to sell itself. Do you find that in your role as, I mean you’re an ambassador, you’ve written three books on product-led growth. Do you find that as well?  

Wes Bush:
Oh, totally. And one of the most viral tweets that I got, a ton of retweets and stuff, I was like, product growth, this is just an effing free trial. It was like, oh, okay. There’s a lot of people that  

Rob Walling:
Think that.  

Wes Bush:
So it was interesting.  

Rob Walling:
So I want to start by letting people know, you’ve written three books on product-led growth, so you certainly, of all the guests I’ve had on this podcast, probably the person who knows the most about it and who has thought the most about it. You have the product-led playbook, you have product-led growth, that title and product led onboarding  

Wes Bush:
Ley. John did write that one. I just wrote the first chapter, but  

Rob Walling:
Oh, okay. Well, thanks for the clarification. Yeah, no worries. I’d love to start by let’s do the best job we can at really defining what product led growth is. So I’ll kick it to you, you say what you think it is, and then I’m going to say like, well, is this product leg growth? Just so we can kind of tease it apart because I have my own internal definition of what is, I’m not even sure it’s right. So talk us through PLG.  

Wes Bush:
Yeah, and I think where a lot of people get confused is thinking of one dimension of like, oh yeah, that’s product like growth, whereas it’s a multi-dimensional thing that impacts your entire business. So here’s a fun way of thinking about it, is product-led growth is when you use your product to acquire new customers, engage them, meaning getting them to value and also monetizing. And you could also take that to expanding customers as well, but it’s where you’re using your product throughout your entire go-to market motion. It’s not just the free trial for people to sign up for free, but it helps them get the value. It also upgrades them and you can use it for expansion as well. And so at the surface, that’s what it is in its simplest way, and you’re talking about different examples of it, what it looks like. I’ll use some non-software as a service examples like Cologne, perfume, I think those are great examples of PLG and the real world where it’s like, Hey, I can try it before I buy it. And that’s really, I think a core tenant of it. It’s got to have that experience where, okay, I tried it for free, I like  

Rob Walling:
It. Oh, I like that example of cologne. I’d never thought of it. To me, when I hear PLG, I’m just like SaaS, SaaS and software,  

Wes Bush:
Right? Yeah,  

Rob Walling:
Self-serve freemium. These things all come to mind, but that’s kind of cool to hear an example of a real world product. So now I want to ask you some questions and say, is this product led growth or is it not? So my last SaaS startup was called Drip. It’s still functioning here in town downtown Minneapolis, and we had a self-serve trial credit card upfront, and for now, we had no free plan. Later we did. So we’re going to get a lot of examples out of this, but no free plan. Put a credit card upfront. You get a trial for whatever it was, 14, 21 days inside the app, there was a bunch of onboarding stuff, there were videos and kind of like, Hey, do this next, and you got emails to come and engage and do this next. And then if you got fully set up, then you got to choose if you canceled your trial or if your credit card got charged at the end basically. I always thought of that as just, to me, I just say, well, that’s self-serve SaaS that it existed since Basecamp is self-serve SaaS, and I had hit tail in 20 10, 20 11, that was self-serve SaaS, and it all followed that model. But would you include that under the umbrella of PLG?  

Wes Bush:
Well, here’s a qualifying question. First, we’re users that were signing up able to get to value for free. They could, in drips case, send a lot of emails and really feel like, okay, I got the value from the product, could do something interesting in the product that I couldn’t do before.  

Rob Walling:
And that was included in the trial itself. It truly was a free trial. And yes, they could do everything in terms of uploading subscribers, sending emails, getting the value that the product offered.  

Wes Bush:
So that would be an example where it’s like, yes, I would consider that product led. Now I’m going to try and confuse everybody here for a second and give an example of a company that does have a free trial but is not product led because it’s not always the same case. So this company is called ZoomInfo. A lot of people know about them. You can sign up for the free trial and it’s actually more of a request, a free trial. And then you get to the, okay, you fill out your info and it’s like book a call. You got to go through this whole experience and everything from the second you fill out that form is like convert, let’s convert them and let’s get them on the phone and convert them. So there was no value exchange, there was no kind of try before I buy experience. 

So you can actually have a free experience, free trial, but if every bone in that company is soon as you sign up is like convert them, convert them, convert them, no, that’s still just using a different mousetrap At the end of the day, what the biggest changes between what I would classify as more of a sales led company versus a product led one really comes down to, if you think of oversimplify, a go-to market motion, there’s really three things that go on in any business. There’s acquisition, there’s monetization, you got to make customers, and then there’s the overall engagement delivering on the value. Now a traditional sales like company, it’s like you acquire them, then it kicks off the monetization side of things. Then it’s about engagement, delivering on the value. The big change in product-led growth and product-led companies is just that middle piece. It switches. So it goes from acquisition to engagements. You deliver value before you purchase, and then it’s monetization. And so whenever you’re thinking, is this a sales led or a product led company, just refer back to that because that is probably the easiest way to kind of see, oh, okay, is that truly your product led company or not?  

Rob Walling:
So it’s engage, monetize or swapped is what you’re saying?  

Wes Bush:
Exactly.  

Rob Walling:
That’s interesting. Okay, let me ask you this, then there’s a company called Spark Toro. Have you heard of it? Rand Fishkins company?  

Wes Bush:
Yeah, yeah, definitely.  

Rob Walling:
And I’m an investor there, friends with Rand, they have a try it free button on their website. When you click it, you do self sign up for an account, your username and password, or I think you can authentic through Google. And then what you do is you get a, it’s a really limited free plan. In essence, you get five searches a month, so very limited and I believe you only get the top three or four results or five results when there might be hundreds. And if you’re a paying customer, you can get all the data. And for folks who don’t know about Spark Toro, the H one is how do you get better ROI from content, SEO, social PR and performance marketing smart to is basically an audience research tool for marketers. So with that stage set of how I just described kind of this free, it’s even a stretch to say it’s a free mean plan, it is quite limited, but what is that? Is that product-led growth? Definitely not. They’re not doing sales. So does that by default mean their product led growth?  

Wes Bush:
Yeah, in theory, that’s the free motion they have that. I think that’s definitely in the right direction. The only thing where I would be like, okay, is that the right thing they’re giving away free is could someone sign up for that and feel like they genuinely got some insight that was really meaningful to them? Now, if they can check the box on that, it’s like, Hey, that’s a great free motion. And yeah, I would still classify that as product led, you’re giving away free, but what separates a great free model from one that’s just mediocre and not many people convert at the end of the day is it all comes down to what is the outcome of that free product? Does it have one very similar products that we’re working with? One of our clients, it’s for trade opportunities if for export import businesses, let’s say are trying to find the best baati rice exporter, and it’s like it shows the database, you know what? 

They only need to find one. They need to find one deal that’s really incredible. And what we decided to give away for free is like, hey, finding that person finding that is free now if you want to contact them, then you got to upgrade at that specific stage. Now it doesn’t seem like it’s a lot, but it’s enough. It’s enough for them to fill, they walk away from that experience saying, Hey, if I need to find another export import business, I know exactly where I got to go. And same thing with Spark Tora. It’s like as long as they find out of those top four or three options, something’s meaningful, then it’s enough. But that’s the tricky part too, because if you search and you waste those five searches on something, you don’t find anything useful, then people are like, this product sucks.  

Rob Walling:
And I kind of asked a question without asking a question with my last prompt, which is sales led is what maybe the Jason Lemkin playbook, I think of it where it’s just a lot of outbound and it’s just this, you build up this big sales force, the boiler room as they say, and you obviously have inbound, you try to do inbound, and anybody who comes inbound, it’s like do a demo, put ’em through the sales funnel versus product led. What you’re saying is, well, that’s more of the product provides the value. I feel like that’s a false dichotomy. I feel like there’s more nuance to this whole story than that. And in fact, coming back to Drip, we did both of those things. Now we did outbound, it was not a huge motion, but we had a ton of inbound. I’m a better marketer than a salesperson, let’s put it that way. 

So we had a ton of inbound just from all the stuff we were doing. And what we noticed was on the lower end, if someone’s going to pay us $50 a month or a hundred dollars a month, those our cheapest plans had to be product led. We weren’t going to do a demo, just the A CV. The LTV was not there for it. But we’d see someone come through and it’d be like, oh, this is someone, it’s a website that that if I said the name of you would know. And it’s like, well, I’m sure they have a million subscribers and they’re probably going to pay us $3,000 a month. So then we would reach out to them and we’re like, we need to get on the phone with you. We know that we can help close the deal. So I call that a dual funnel now where there’s lower end and the higher end and you handle ’em differently. So I guess were we sales led? Were we product led, or would you just say, well, you’re both,  

Wes Bush:
Yeah, that’s both hybrid and that’s great motion to have if you can do that. If you’re only product let’s say is like $10 per month, something like, it’s like, okay, it probably doesn’t make sense even if that company did sign up because there’s not that expansion opportunity where you can make it work. But no, I love those motions and I think that’s using the best of both worlds where it’s saying, Hey, if you’re a small company here, self-serve, do that. And if you’re a bigger company, hey, there’s a different approach. And we could actually maybe even position that instead of just like, Hey, you want to hop on a call with me? It’s like, Hey, I know you have a big list. How can we create email marketing strategy together that is going to be so much better than what you’re currently doing? And they’re like, man, this drip company’s really looking out for me outside of just looking for another place to send emails. They’re a value added partner here, absolutely like 3000 per month. That seems like a no brainer deal. To get this advice to  

Rob Walling:
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So let’s talk a little bit about product-led growth. And I think a lot of people think freemium, you have to have freemium and you’re basically like, no, a free trial, as long as you get value out of the product and that’s engaging in monetizing, that is a qualifier. You can still be included in the PLG Hall of Fame if we’re a paid or a free trial that makes, oh no, it’s the monetization has to be after. So it can’t be a paid trial,  

Wes Bush:
It  

Rob Walling:
Has to be  

Wes Bush:
Free. So the free model you choose actually doesn’t matter. So if you look at billion dollar plus product companies, you’ll find every company with whether it’s a free trial, a Freeman model usage-based trial, they’re all out there. What does matter though is deciding what is the main outcome of your free model. So what could you actually do when you sign up for that free product? And is it actually something that feels like it’s tangible value for that user? A lot of times I’ll send it for a free trial as an example, and you click around and you do a couple things. You’re like, Whoopi, I can’t do anything I couldn’t do before. There is no transformation. And the best product companies, they all have somewhat of a transformation where it’s like, Hey, before chat GBT and after chat GBT, it’s like it is pretty clear there was a difference there in productivity and all those other things. So you got to have that. You got to allow your product to shine in that free experience. And so I could go on a whole big tangent, Rob, go through how do you actually decide what’s to giveaway for free? But I just wanted to point that out that the model doesn’t matter as much as people think it is, it’s what that outcome is. And deciding what that is is really the tricky part.  

Rob Walling:
It’s interesting because with Bootstrappers, which the majority of this audience is folks who are bootstrapping are mostly bootstrapping, frankly. I mean there’s 20 or 30% who want to raise funding or have raised some type of funding, but it is just the non venture track. SaaS founders is kind of the listeners of this audience. We’ve just always done product led. That’s just what we did from the start. Because I wasn’t good at sales demos, I wasn’t going to do a bunch of outbound, my SaaS 2009, 2010, 11, it was marketing. And since I was charging early SaaS companies, I had with 10, 20, 40 a month, so really low end and then 50, a hundred, 200 with Drip. I couldn’t afford to do anything but build onboarding into the app because I had to operate at a scale that it just required that and I wasn’t going to be able to manually onboard. So I acquired through SEO content, a bunch of other demand gen, and then I engaged in the product because I was a developer. And that’s the only way to automate it to the point where I could have 500 or a thousand customers in order to get to tens of thousands of dollars a month in MRR and then of course monetization. It was always just a free trial to monetize. So it really sounds like the default for most bootstrappers is probably going to be product led. Is that accurate?  

Wes Bush:
So I think the mindset of them wanting to go this direction is, but then there’s very few folks where that is like, Hey, this is what I want to do, and I’m actually seeing really good success with it because I think folks like yourself where you have just naturally done it is actually really rare. There’s like for every one of you, there’s probably 10 others that are like, yeah, I want that too. Yet when I try and do the product led thing, I suck at it or it just doesn’t work out the way I thought it was. The free to paid conversion rates really bad and because users can’t get the value, they just don’t upgrade. So there’s a host of other reasons why it usually doesn’t work. But yeah, I’d say generally speaking, they do want that specific direction because they see that is the most efficient way to scale this business without adding people and more cost to the equation.  

Rob Walling:
And I think one of the annoying things for me with PLG is that people have misused it, and I see makers and developers being like, it means I don’t have to market because the product just sells itself. And it’s like, that’s not my, I don’t think any product really sells itself. I mean, again, it sounds like I’ve been running all my SaaS was PLG, and yet it never sold itself. I marketed the shit out of that stuff. I drove a lot of traffic, I did a lot of split testing, a lot of conversion optimization. I optimized the hell out of the funnels, the onboard, all of that was a massive thing before growth hacking was a thing. I was doing all of it. It was like, well, I know I want these numbers to go up. I know I want trial to pay to go up. How do I do that? Well, I got to get more people onboarded. How do I do that? Well, I need more people to install the JavaScript snippet on my thing, so how do I do that? And I, it was just a very logical flow. But do you feel, is it just me or do you feel like some devs, maybe especially builder types, maybe misuse the term?  

Wes Bush:
Oh yeah. And I think the biggest reeducation a lot of times do it product-led is just the fact that it’s like, Hey, you still have to market this. You still have to sell it and have really good understanding of what that looks like. There is very few companies I’ve interviewed hundreds of product-led founders where I’m like one out of maybe 300 has a situation where their product does market itself really, really well. But that is because they were super intentional about how that product was going to interact with other people. Mixmax is perfect example. When I was interviewing the CO Olaf, he was like, you know what? We have a $0 cost per acquisition cost. I was like, this is pretty fantastic. But it’s like you send an email powered by mix. I was like, oh, you got this beautiful growth lever, external virality. How many companies have that? Most companies just have internal virality where it’s like, Hey, you share this with your other employees and other users. That’s not going to get you that crazy marketing growth and a user signups that you want. But every once in a while you do find a company where it’s like, that really worked for them and you just hope that that might be your company.  

Rob Walling:
But as you’re saying, it’s one out of hundreds. Slack was used often as an early example, PLG. Would you say they’re similar because it did feel like there’s a viral loop in Slack that kind of became associated with product-led growth means that you infiltrate an org and then they invite a bunch of people and there’s virality and it doesn’t sound like that’s what we’re talking about. It sounds like they had that extra bonus of being one out of a few hundred where it could kind of market itself.  

Wes Bush:
Yeah. Well, slack had really fantastic internal virality. You just think of the natural side of like, okay, Rob’s not on this installation. Let’s add Rob. And it’s like, sure, he is on our team, so why not? And it just naturally gravitates towards that. But since it was such a good product and did it so much better than email in a lot of ways, then it just naturally grew out from that, from word of mouth. But they did invest. If you still look at their p and l, majority of their expenses are still going towards marketing and sales, which is fascinating to see that. And maybe that shouldn’t be the case right now since their acquisition and now their product has just kind of stayed stagnant. But it’s worth considering, yes, invest in marketing and sales. It does not mean being a product of business. You don’t have to do that.  

Rob Walling:
I think the probably the biggest point I want to drive home today for people listening is I think there’s a lot of perhaps misunderstanding or miscommunication around it. So then it begs the question, what are the big benefits of product led growth as opposed to sales led? The big benefits that you see,  

Wes Bush:
It really just comes down to do you want to have a leveraged business where it’s the asset you’re building is the product As you scale up, you get more and more efficient, you get more profits, can afford to have a higher revenue per employee, all that fun stuff. Or do you want the people to be the machine in the business? And so many folks, it’s like, actually, I want more leverage in the business. And so that’s the biggest thing. It just comes down to leverage at the end of the day.  

Rob Walling:
And you mentioned to me offline before we started that you actually have something you’d like to give to the listeners. What do you have?  

Wes Bush:
Yeah, so I just wrote the product-led playbook, which at the very beginning of this book, I’m like, Hey, you know what? This is not the book for you. If you don’t know if product-led growth is right for you. That’s the first one I wrote. Product-led growth. This one is literally just here’s how you actually do it. It goes through nine core pieces that you got to implement inside your business, like onboarding pricing. It just gives you the exact frameworks for how to do it and the templates. So it’s all free for you product led gift.com, and you can just get that for free. And that’s the entire book we held. Nothing back there.  

Rob Walling:
Awesome. Well thanks for that. I hope folks check it out. So I have one or two questions for you before we wrap up. And I think I want to frame, because I’m looking at an outline of the book, I have a table of contest and stuff in chapter six, how to decide what to give away for free versus what to monetize. It’s such a good conversation. And frankly, this is a common one I have with my investments. I’m invested in 200 and I think it’s 212 SaaS companies through TinySeed and then individually. And so I see the gamut, freemium or not of free trial, of not of sales led, product led, like the whole deal. And frequently I’m pulled into conversations. A lot of it’s pricing strategy and then it’s currently what we have, what should we, and I’m always like, I have my own kind of mental pattern matching framework, but I’ve never written it. I don’t even know if I could put it into words. So I’m curious. I know you can’t read the whole chapter six, but what’s the base framework there?  

Wes Bush:
Yeah, I think this would be more fun too, if you tell me about a company that really well that they were struggling with this, and we can workshop and as people listen, this will be like five minutes and we could go through that framework.  

Rob Walling:
Cool. So is this a free trial or is it freemium in this example?  

Wes Bush:
No, it could be anything. You pick the company, I’ll use the framework and then people will kind of learn through that.  

Rob Walling:
Alright, so let’s talk about frequent podcast guest, Derek Rimer. He runs a company called Savvy Cal. They are a competitor to Calendly and they have a free trial or it’s a 30 day money back guarantee. Let’s pretend they had a 30 day free trial because they’re PLG, but they do have a money back guarantee. So that’s in essence what they’re trying to do. They do not have a freemium, a free forever  

Wes Bush:
Plan. So thanks for that. I got their website pulled up and now who is their ideal user? The person they feel like, Hey, we got to just target this person. They’re the best people.  

Rob Walling:
So they actually have a couple, my understanding, or there were early adopters that were listeners to this podcast, that type bootstrappers and founders of Bootstrap companies. I think they made a shift as the audience grew or as their customer base grew and they started getting calendar power users, which I think are a lot more salespeople.  

Wes Bush:
So first off, this is why it’s so hard, and this is for everybody listening. If you don’t know without a hundred percent confidence who your ideal user is, and I’m on the website too, it’s not just you, Rob, it’s not clear who is this for? I don’t know. Because in the world of calendar booking systems, it’s commoditized right now. There’s tidy Cal if I want to pay 49 bucks once. Sure. And there’s a ton of different options out there and book like a boss, they have a very specific persona on service professionals and stuff. So that would be the first kind of task I’d be like, okay, get really clear. Let’s go with a sales person though, because that’s more fun. And so let’s say it’s salespeople now, what is ultimate success for that sales person? We got to get super clear on that. What would you say that looks like, even if we’re just making it up on the spot a bit  

Rob Walling:
Ultimate success, that it’s a complete super seamless booking experience for their prospects.  

Wes Bush:
And now if we think about this space, unless you’ve been living under a rock, you’ve probably heard of Calendly. So what is the unique sauce that they might bring to the table that’s like, Hey, this is unique, differentiated for people that are sales reps that are trying to just book easier?  

Rob Walling:
Yeah, it’s not on the website now, but the early positioning of avial was most booking links. There’s a power differential and it can be offensive to send your booking link because it’s like, oh, now you put a bunch of work on my shoulder,  

Wes Bush:
Right?  

Rob Walling:
Yep. Oh really? Now I got to click around, blah, blah, blah. And that was Avi Cal’s early positioning was, so I’m going to go with that. But the differentiated between them and Calendly is the booking experience itself is very much does everything you can do with amazing UX to remove that feeling.  

Wes Bush:
Okay, so let’s say for the salesperson, we have, I’m pulling up a stat out of thin air here, but it’s 30% more meetings booked with your ideal prospects just because the experience is better and everything else. So that’s success. We’re trying to gear people towards that. Now, if we think about making this a game, this is where we get to the model part. Let’s divide this up into three levels. There’s your beginner level, which is, think about it as the newbie. They sign up, they’re like, oh yeah, let’s go through this, see what it’s all about. Then there’s your intermediate level. This is your first paid pro plan, and there’s the events level, which is your most expensive stuff. So for that initial beginner one, what might that beginner outcome be? Is it enough for it to just be, Hey, book one meeting with the prospect? Is it five meetings, 10 meetings? What do you think that might be for them?  

Rob Walling:
Probably one. I think it’s just that initial meeting.  

Wes Bush:
So it could literally just be one meeting. Now if they do a test or something like that, that might be a bit tricky where it’s like, okay, they did the test meeting on their own.  

Rob Walling:
Oh, I see. Oh, I was thinking one meeting with each prospect. You’re just saying, yeah, the absolute value. At what point would they, huh, that’s interesting. Let’s say they booked five meetings, five prospects book meetings or five book meetings. Overall, you can do that with any, there’s no differentiation. You can do that with any calendar software. So it would almost to me be like, the moment that someone complimented me and said, holy, that was a really great booking. That would be the moment where I’d be like, oh, someone noticed that it was different. I dunno if that can be a qualifying event or not. But  

Wes Bush:
Yeah, and this is the tricky part, right? Because it’s the special secret sauce. Whatever makes your product shine needs to come out in that free version. And if it’s just meat game one meeting booked, so what? It doesn’t pass the hurdle. And so this is one of the challenges when you’re thinking about what to give away for free if you’re in a very saturated space with a lot of competitors that already have really good free motions, and so you have to be creative. What is that new experience? And so would, like you said, it has to go back to did they, maybe it’s a customer or somebody that booked that meeting, have that experience where they said, wow, this is fantastic. Could we track it? I would start going down that rabbit hole and say, okay, it’s in this direction. We don’t know what exactly. 

We got to validate what that looks like, but it’s something when they have this experience, they book 30% more meetings that they can feel the tangible difference of. When I was using Calendly, I was getting blocked. A lot of times people were in booking meetings, they felt bad about it. Whereas with Savvy Cal, now I have a story, and that story is now actually going to be in their head, the user’s head, and they’re going to tell themselves that story when they’re like, this is why I’m buying Savvy Cal today. Because it makes so much more sense than the other alternatives. They just don’t get me like that. But if you start off with that vague ideal user, it’s so much harder because everything that you give away for free should be tied back to who is that ideal user? What is that ultimate success? And that’s how you build an intentional free model, not just give away random,  

Rob Walling:
Right, right. Just pick it off a dartboard. That’s cool. And my apologies to Derek Reimer, who certainly is hearing this and absolutely cringing at all my answers. How when you’re the founder of the company, he knows all the answers to these, and I’m kind of like, I’m going to make this one up. I’m not sure if it’s exactly right. So no, that was super cool, man. Thanks for leaning into the thought experiment there. If folks want to check out the book, obviously product led gift.com, or they can head to product led.com/playbook or frankly on Amazon, though your book is available in all the formats, folks would want to find it. Wes Bush, thanks so much for joining me on the show today.  

Wes Bush:
Thanks for having me.  

Rob Walling:
If folks want to keep up with you on X, Twitter, u are, Wesco bush and product led.com, if they want to check out all the stuff you’re up to. Thanks again, man.  

Wes Bush:
This is fun.  

Rob Walling:
Thanks again to Wes for joining me on the show today, and thank you for listening this week and every week. This is Rob Walling signing off from episode 741.

Rob Walling:
Welcome to Startup For, the Rest Of Us. I’m your host, Rob Walling, and in this episode I sit down with Dr. Sherry Walling to talk about our new book Exit Strategy, the Entrepreneur’s Guide to Selling Your Business Without Regret. The Kickstarter for this book launches today. If you want to back it or you’re interested in checking out the tears and seeing all the amazing copy that Leanna Pat wrote for us, head to exit strategy book.com. I hope you’ll consider backing this book. I talk about it in the conversation, but I’m really proud of the end product of what we put together, and we put a ton of time into it. We interviewed a lot of entrepreneurs across different business types. It’s not just about selling SaaS, it’s about selling for the most part, any kind of business. And I’m really excited to get this into the hands of folks like yourself, entrepreneurs who may be thinking about selling, who may be in the midst of selling or who have sold and are trying to think about what’s next. Or even if you are not thinking about selling today, having this knowledge in your head as you build your business can only help you. So exit strategy book.com, it’d be amazing if you decide to back the Kickstarter. And with that, let’s dive into our conversation, doctor, Dr. Sherry Walling. Thanks so much for joining me on the show.  

Dr. Sherry Walling:
My pleasure.  

Rob Walling:
So we wrote a book, another book, this one’s called Exit Strategy, and I think a couple clarifications right off the top. It’s not just about selling SaaS, it’s about selling any type of company. We interviewed folks who sold agencies.  

Dr. Sherry Walling:
Yeah, professional service companies, a sort of chain of gyms, brick and mortar businesses. This book was really born out of my conversations with clients over the years who said things like, this is the hardest thing that’s ever happened to me, or I feel like I’m going through a divorce. And that’s not limited to SaaS. The challenge of this process is pretty universal for entrepreneurs going through it.  

Rob Walling:
And since the book focuses so much on the mental, the emotional, the psychological, the without regret part of before selling, thinking through should I sell, what’s it going to look like during selling? Oh my gosh, this is a pressure cooker, as you said, it’s the hardest thing I’ve ever done. And then the after recovering working for the acquirer, what to do next. Those things apply broadly across pretty much any type of business that is not just a, if you have look, have a little 10 K side project or some tiny little thing. Is it this agonizing? No, but this is about having a bigger exit and maybe having a team and that kind of stuff. And that applies to a lot of different types of businesses.  

Dr. Sherry Walling:
It’s about the story of building a business that becomes very valuable and sellable. People offload apps here and there or do things on a pretty small level, but this is the story about when you build something that is part of you and you put all of the blood, sweat, and tears into making something that’s very valuable, and then what it feels like to go through the process of selling it, of releasing it, putting your life together afterward.  

Rob Walling:
And there were a lot of really good books about selling your company. John Warlow has one art of selling your company to Andrews wrote before the exit Bo Burham wrote Finish Big. So I guess what’s our unique take? It’s two part question. Why did we decide to write this in the first place? And then what is our unique take that you think we bring to the topic?  

Dr. Sherry Walling:
I mean, I think the pairing of you as a serial entrepreneur and me as a clinical psychologist is really unique. I think there’s a lot of nuance and mental sort of analysis in this book that is different, or at least we are adding something pretty significant to the conversation when we think about the kinds of processes that people are going through when they’re going through a major transition in the middle of their professional lives. You’ve also been on the front row of hundreds of exits at this point in your work in TinySeed and through your connections with MicroConf. And so I think the number of reps that you and I have done together from very different perspectives is unique and really shapes what we’re offering in this book.  

Rob Walling:
And and I, it felt like we were having similar conversations over and over where you were like, Hey, one of my clients is thinking about selling or going through the sale process or has gone through the sales process and this is happening. And I’m like, well, didn’t that happen to someone else? Or that did happen to a friend of mine that I know through MicroConf. And it was like we would get asked questions of like, well, what books should I read or what resources are there around this topic? And it kept being like, well, obviously there’s these good books, but they don’t have maybe the very specific opinions that you and I have about how to try to do this well from a mental health perspective and realistically without Regret is in the subtitle for a reason.  

Dr. Sherry Walling:
I think what’s also interesting is that not only have we been in this sort of consulting seat in las, but we’ve been through an exit. You’ve been through it directly with Drip, and I’ve been through it as your partner, as your significant other. And I think that’s a piece that is often overlooked in business books is the relational impact of some of these transitions, not just on the founder, not just on the founder and their team, but on their family. And this book isn’t a heavy, heavy focus on that, but it is woven through in its, I think really shaped by our experience of having done the reps ourselves and then done them on behalf of other people.  

Rob Walling:
Yeah, there’s definitely a running thread through this book of A, how difficult this process actually is, and B, how much of a toll it takes on not only the founder, the entrepreneur, but on the people around them, their family, significant other, and so on,  

Dr. Sherry Walling:
And that it doesn’t have to be that way. So the default setting is this is hard and can be surprisingly destructive, but it does not have to be that way. So I think that’s the point of the book is to help offer the ability for people to open their eyes, look to see what’s happening, do some self-assessment, and then have some tools to help make more aware and more intentional choices about how they go through this process.  

Rob Walling:
And if someone’s starting a business today and they’re not going to sell it here in the next 12, 18, 24 months, I still feel like there’s value in experiencing this journey alongside the entrepreneurs that we interviewed for the book. What did we enter? 15 people, 20 people. I mean, we did a lot of, it wasn’t just out of in my head. I mean, we did a ton of legwork to pull it in, and there’s a lot of stories, a lot of quotes.  

Dr. Sherry Walling:
I think this book is actually about how to have a healthy relationship with your business, and that’s where it’s relevant to anyone at any phase of their entrepreneurial journey. I think it would be a super great book to read at the beginning because it talks about this balance between going all in and being very careful and very attentive to what the business needs from you and how to protect it well, and how to think about your team and also on the other end of the spectrum, this de-identification between your selfhood and the business that you’re running. And if you can strike that balance well early in your business, I think you are just set up for success in a lot of ways, not just in your exit, but in your mental wellbeing and balance throughout the course of the journey.  

Rob Walling:
And the book’s not out yet. And the reason we’re talking about it today is the day this episode goes live, our Kickstarter for this book goes live. And so folks can head to exit strategy book.com and there’ll be a link there where they can go straight to the Kickstarter page and they can back the book. We’re going to have it in three formats. We’re going to have a hardcover run like I did with SaaS Playbook where we have an offset printer. It’s just amazing. It’s like the same printers who print for any big publisher. And so the quality of the book is just really outstanding.  

Dr. Sherry Walling:
Do you have it there with you? Yeah, I was like, I should have it in my, this is  

Rob Walling:
A digital, I have a digital copy of it that is a print on demand version, but it’s so neat to finally have it here in my hands. And it’s a meaty book. It’s a couple hundred pages, right? 250 pages or so. But with the Kickstarter, we’re going to have an audio version that you and I are going to read together. Isn’t that  

Dr. Sherry Walling:
Sweet? It’s going to be adorable.  

Rob Walling:
It’s going to be so adorable.  

Dr. Sherry Walling:
I’m sure we won’t have any arguments about it.  

Rob Walling:
Nope. During I’m going to leave you, Josh, please edit a lot of any arguments out, but I do like to riff on the audiobook. We haven’t recorded it yet, but that’s something I’m looking forward to doing with you is kind of riffing on different things. And then of course we have an electronic, like a PDF epub version, but in addition to that, we’re offering things that we’ve never offered before, right?  

Dr. Sherry Walling:
All kinds of opportunities to hang out with us either in some q and a sessions where you can come and ask questions about your business, your exit, things that you’re thinking about to one or both of us. I think we have an option where both of us are involved all the way to the opportunity to come to beautiful Minneapolis in the summer and do a founder retreat with the two of us together. So the dates and all the details about that are on the site, but I am personally really excited about doing it that way and the kinds of interactions that it allows us to have with people that we might not necessarily bump up against in our day-to-day lives.  

Rob Walling:
Yeah, I would agree. At one point on this very podcast, it was probably 2021, I did a call for anyone who is in the middle of an exit or really on the cusp of an exit. If you’re thinking about selling, just email me and I will send you a 20 minute zoom link and I’ll zoom with any and everyone who’s going to do it. And part of that was I wanted to talk to more founders who were doing it. But the other thing is I said, this is one of the most important moments slash transactions of your life. And I talked to so many people who were like, I’m going to sell this. I started this kind of listening to the podcast and thought it’d be a little side project, and I got an offer for $9 million, and I was just like, what? And so I had these great conversations and part of those anonymized and everything going to the knowledge bank of writing this book, but I realized through those conversations even more the need for this. You and I’ve been talking about writing this book for three, four years at this point, and it took us, what about a year and a half, I guess, to get it all put together?  

Dr. Sherry Walling:
Yeah, it was such a fun process. There’s obviously lots of different ways to write books, but because we spend so much time talking to each other, podcasting and things like that, I really enjoy the process of having a really detailed outline and then going chapter by chapter and basically recording audio of it and transcribing that and then turning that into the written word. So I think it’s a fun way to collaborate together. And so there really is a mixture of both of our voices in really every chapter, even though some chapters are more based on my expertise and others are based more on your expertise, there’s still this weighing in and question asking of the other person, which I think helps it to be a much better product because you have thoughtful questions that are guiding the development of content.  

Rob Walling:
Yeah, I’m super, super proud of this book. I think it turned out really well, potentially, I hate to say it, but almost better than I could have expected when we started, which is how I like  

Dr. Sherry Walling:
Wow, look at you in the low expectations.  

Rob Walling:
I know, but I like having, I don’t know. I like it when it’s an end product and it’s like, yeah, I know this is dialed in. Something that I really like about the book, as I said earlier, there’s the before, the during and the after your exit. Those are kind of the three sections we have. And one part of the before chapter two, when is it time to go? And we look at external and internal cues for thinking about when you may want to exit. And I remember putting this chapter together, and one of the things that is interesting is that you and I have seen so many people sell that these things just kind of rolled. It was like, let’s brainstorm. Why do people sell? Boom, boom, boom, boom, and then run this list by other people I know who’ve sold. Are we missing any of these? So I feel just really good about the list we put together. Some of the external cues we mentioned are, you’ve built something amazing, the business needs more capital, you’re no longer the best person to run the business. The competitive landscape shifts a change in life status, and another opportunity arises just to give folks an idea of the kind of, and then we dive obviously deep into each of those and how those might come about and how to think about them if you’re in that situation.  

Dr. Sherry Walling:
And also assessing what are helpful motivations to sell and where are, so we talk about some of the internal cues like existential restlessness or energy levels, some even burnout, and when maybe those things lead you to want to sell because you want out, but they’re not always the best for you in the long run or the best for the business. And so thinking through just how to be an observation, an observer of your own mental internal process, and then what to do if you maybe want out, but don’t necessarily, it doesn’t make sense to sell right now. So we sort of dive into some of those options.  

Rob Walling:
And in typical Dr. Walling fashion, this is something I’ve never done in my books. We have making it real at the end of each chapter where it’s like, look, I just told you a bunch of really interesting things and now there are questions to think about and to journal and to take action on. So  

Dr. Sherry Walling:
In my last book Testing two worlds, I worked at the traditional publisher and they really pushed me on this. They were like, your stories are great. Thank you for the wisdom, but what do we do about it? And I, frankly, the challenge of helping people really apply it to their specific situation. So it’s all fine and good to absorb content, but if you can’t do anything with it, then it’s really not in your best highest service. So we’ve worked pretty hard on those sections to give you at least some journaling prompts and thoughtful questions that will help you to go deeper with some of the content that we’ve presented.  

Rob Walling:
And throughout the book, we try to set expectations of what an exit might look like. And I find that we were repeated over and over so much that eventually we had to take it out at a certain point of we just can’t keep saying this, but this is really hard. This is going to be really hard. Isn’t this really hard? That really hard? That felt like a message of the book. Why do you think that we have to say that so often?  

Dr. Sherry Walling:
It’s such a dream outcome. I think the stories that persist on social media or Twitter of the founder who sells for a huge bucket of money and rides off into the sunset or starts a farm in Austin, but it has this glow to it, and I just think that it is kind of giving birth. It has a great outcome. Babies are great, but it’s a grizzly bloody messy process. And because we’ve so glorified the end result, I don’t know that we collectively as an entrepreneurial community have told the truth about the process.  

Rob Walling:
And I think, I know for me, a chunk of the entrepreneurs that I talk to, the founders I talk to who are about exit, I’ll tell them it’s going to be really hard. And I’ve had people tell me, yeah, not for me. It’s not going to be hard for me and then come out together.  

Dr. Sherry Walling:
I got it. I’m not attached to my business. I’m rational. I’m objective.  

Rob Walling:
This won’t be hard.  

Dr. Sherry Walling:
I’m not that worried about it.  

Rob Walling:
I’m so prepared. And then come out the other side like, oh my gosh, you were right. And it’s like, I know it really is as hard.  

Dr. Sherry Walling:
It always, it starts relatively simply. I mean, the wonderful story is somebody gets an LOI and you agree quickly on the terms and it just feels like it’s going to be smooth sailing. But inevitably there’s some series of disruptions in the deal that require sleeveless nights and long conversations with lawyers. And it’s just the way it goes  

Rob Walling:
Inevitably is pretty much my experience. And the interesting thing is as entrepreneurs, we do hard things and we think as you said, that it’s like we can logic our way out of it or that we can just, we’ve done hard things in the past and I know that I can do it, but you get in this position where it’s like, all right, I’ve signed this letter of intent for $10 million and we’re going to close in 45 days, 45 days. I could do anything for 45 days. And then suddenly you find that you’re like, whoa, there is a lot of uncertainty here. And whoa, there are a lot of people that are kind of pissing me off here with the pushback on the thing and asking for the stuff. And you start to get in your own head. People start sleeping. There are entrepreneurs who you can’t sleep so stressed about it. And then you get towards the end and everything’s up in the air still.  

Dr. Sherry Walling:
And then it’s not 45 days, it’s 50 days, it’s 60 days. It’s the lawyers on vacation. Yeah.  

Rob Walling:
And so that is something we talk about. We have, I mean obviously there’s what, 14 chapters in the book and only two of them are really about deal structure and deal points because again, there are really good books like the Art of Selling Your Company that cover that type of stuff. So the vast majority of the book is thinking through whether to do it and how to do it well, and then how to be on the other side and ask what’s next. But I really like in chapter seven, it’s called collateral Damage, minimizing negative Impact. And we talk about minimizing negative impact to your mental health, your physical health, your family, your team, your company, and the deal itself. And then we have specific strategies for that. It’s learn how to time travel, take on an exit project, go on that vacation, let your partner in on your emotional state and other things. A lot of those came from you. I mean, I was pulling out the, here’s all the collateral damage it can do, but really the strategies for how to minimize those or how to stay healthy, a lot of that comes in your voice, a lot of your work.  

Dr. Sherry Walling:
It really is a challenge to construct some internal buffers around your own anxiety, especially for entrepreneurs who have often used their anxiety or their agitation as fuel to get things done. But in this process, you can only get done what is on your to-do list in that moment. And then you are waiting on all of these other people, on the buyer, on the broker, on the whoever else. And so it’s a really abrupt, difficult lesson in holding agitation and anxiety when there’s nothing really effective to be done with it because there are things that are happening or that you have to wait for that you can’t control. And so a lot of these strategies are around what to do with that energy, frankly, how to not let it eat you alive and not let it spin out of control in a way that hurts the people around you and leaves you trying to push the deal forward or being thoughtless or reactive because you are uncomfortable and agitated.  

Rob Walling:
I like that you bring up that point of there are things outside of your control that you just can’t do anything about. Because again, as entrepreneurs, as founders, we start companies, some of us because we want to control everything. And suddenly you’re in the middle of a process where it’s like some clown shoes, lawyer on the other end, as you said, is on vacation or is taken four days to turn things around and you’re like, dude, this is $10 million. This is the biggest thing of my life. This is my life. But it’s just another day for them. It’s just another deal.  

Dr. Sherry Walling:
Just another email.  

Rob Walling:
And we talked through in chapter 10, we have the 3:00 AM what ifs. And all of these quotes are things that you and I have either heard from entrepreneurs or we heard in the interviews as we talked to entrepreneurs, things like, what if my team falls apart? What if the deal falls apart? What if I’m not up for this? What if this deal is my only chance? What if I take a bad deal? And there are more, there are a lot of 3:00 AM what ifs. Another thing that I don’t think is talked about enough is life after the exit. We have a chapter called Purgatory that is sad. It’s about working for the acquirer and reporting to a boss. You lose control of your team, of your company, but there are also a upsides to it as well. And that was something that I am really glad we covered.  

Dr. Sherry Walling:
I think this question of life after the exit is maybe some of the content that I’m personally most proud of that feels like a real contribution to this conversation around exits that I just haven’t seen dealt with as thoughtfully and as carefully as we’ve dealt with it. And I think coming from my life as a psychologist, there is this deep appreciation for what it means to be going through a really significant life-changing developmental disruption at a time when your peers aren’t going through that exits are such extraordinary events, they’re just not commonly occurring. And so it’s like getting divorced or sending a kid to college or watching your parents pass away. It’s this major reworking of your identity and what you do during the day and what matters to you. But you’re not doing that along with your peer group. You and I know lots of people whose kids are going to college because that’s the age group that we’re in. And so this idea of going through a major developmental transition alone is pretty unusual and kind of extraordinary in the human experience. And so I think giving people some grounding in that, some understanding and some perspective about why this reworking of your entire life midstream is so challenging and then what to do about it, how to avoid the isolation and how to avoid the kind of spin out that can happen when people lose perspective about just how significant this transition is.  

Rob Walling:
Yeah, I like that you call that out. A lot of people have kids who go to college. A lot of people have a parent who passes away. A lot of people get married, get divorced, have children, whatever. There’s a lot of events that completely can turn your life upside down. And so few people sell a company and so few people, I mean almost no one else is selling a company when you are. And what’s interesting is during the sale, again, there is only so many people you can talk to. We do have a whole chapter on support team and how to put together people to support you, but afterwards, there can be this sense of, shouldn’t I be happy now? Hey, my company was really stressing me out. I don’t have to work on that anymore and I have this huge pile of cash in the bank, but now I’m unhappy. We have this expression whining on the yacht. It’s like you can’t just go on Twitter and say, man, sold my company for $10 million. Life sucks. And I’m so sad every day  

Dr. Sherry Walling:
I’m so bored and lonely.  

Rob Walling:
Totally. Even if that’s really the case. And we talk a lot about that of first day of the rest of your life, like how to recover from this and how to find a peer groups. There are other entrepreneurs who’ve gone through this  

Dr. Sherry Walling:
And to re-anchor into meaning you’re getting a second act, you’ve built something, you’ve gone through the whole journey and then sold it. And it is an immense opportunity to use the phrase that from David Brooks to climb a second mountain to do something else that is interesting and meaningful and valuable to you and to your family and to the world around you. But people have a complicated relationship with that. Sometimes people rush, they can’t tolerate this in-between space, the patients of really considering what’s next. So they buy a company before they’ve finished selling their other company, we tell this story in the book, or they get so churned around about what to do next that they spend years spinning their wheels, not doing anything. So this conversation about what to do next is really important because it does help people re-anchor to what they want their lives to be about in this next iteration.  

Rob Walling:
And we talk about it in, well, we talk about purgatory of, Hey, you’re working for the acquirer still, where it’s this weird in-between of I’ve sold, I have this money, I don’t control the company anymore and I got to figure out now how to be an employee. But then once you do have that break, assuming you move on from that at some point after an earnout, then we talk about how to recover, how to rest up, how to physically recover, connect with yourself and as you’re saying, take stock of the past, embrace the present and look ahead and ask yourself what’s next and with what’s next, there are a couple traps we call out that we’ve seen over and over. It’s the prove I can do it again, trap and the sail away forever trap. Why do people fall into these same traps over and over?  

Dr. Sherry Walling:
It’s so deeply part of us, this story that we create about who we are because of the business that we’ve built. And so the proof I can do it again is about, look how good at entrepreneurship I am. Look how creative look, how it’s just look who I am based on this outcome that I can create. And the pressure to try to do it again just as to reinforce your perception of your identity and then the sail away forever. Ever trap is a little bit like, I don’t need any of it. I’m just going to go retire on a beach in Mexico, which is also not true for the vast majority of entrepreneurs. It’s not an accurate read of themselves. So it’s about needing too much to be an entrepreneur in the prove. I can do it again, sense or not having a proper respect or reverence for how deeply you are a maker and a creator in the sail away forever trip. So finding your balance between those two edges of the spectrum.  

Rob Walling:
And of course, we also, I like this chapter title, what do you Do with a big pile of money? We talk about how money reduces your circle appears and how it changes your friends and your family relationships and even romantic relationships. So obviously this is not a book on specific investing advice, but we do dabble a little bit in that as well. I really liked one quote in that chapter where a founder said, I had all this money and traditionally I’d been investing in index funds and just kind of following the basic financial advice that you would do. And now I had all this money, so I invest like a rich person and started making risky bets and investing in private equity and this stuff that’s not necessarily, it’s like you still Vanguard Index funds or Schwab index funds are still really, really good, even if you have 10, 20, $30 million that you need to invest.  

Dr. Sherry Walling:
Well, again, that speaks to this identity piece, right? I was a scrappy founder and now I’m someone with a big bank account. So doesn’t that mean that I act or hold myself in this different way that my identity shifts now that I’m a rich person or now that I’m a post exit founder? And that’s not necessarily true. Your identity is your identity. You can weave it through these changes, but we have this idea that we put on these certain roles and then act accordingly to those roles. And so I think the theme of the book really is about being able to step back and to see your pull to some of those default settings, and then the ability to choose whether that setting really fits or doesn’t, whether there is a way that rich people invest or not.  

Rob Walling:
And then to cap us off, I’m not going to tell the story, I’m just going to tease it, but one of the cringes stories in the entire book is when you ran over my original Andy Warhol in your Porsche,  

Dr. Sherry Walling:
That did happen,  

Rob Walling:
And I’m going to leave that there. I’m a person who does not identify as a rich person, and yet there you go. That actually happened. So in order to hear that story, you’re going to need to go to exit strategy book.com, back the Kickstarter, and we look forward to getting this book in your hot little hands. Dr. Walling, thanks so much for joining me on the show. Folks want to keep up with you. They can follow you on X Twitter at sherry walling and zen founder.com is your home on the internet, and you have a newsletter that you send out every week as well as a podcast called Zen Founder. Thanks again for joining me.  

Dr. Sherry Walling:
My pleasure. See you in the kitchen.  

Rob Walling:
Thanks to Dr. Walling for joining me on the show. And thank you for joining me this week and every week, exit strategy book.com. If you would like to pick up your hardcover copy, this is the only hardcover printing we will do after these ship. We will then have print on demand paperbacks from Amazon. So if you want to get the fancy schmancy version, these look really good. Honestly, again, I’m really proud of what we put together. Head to exit strategy book.com. Thanks so much for joining me this week and every week. This is Rob Walling signing off from episode 740.

Rob Walling:
Welcome back to another episode of Startups For, the Rest, Of Us. I’m your host, Rob Walling. In this episode, I talk with Andy Kim. He’s the co-founder, co-owner of a SaaS app called Rado that’s at Trot two. Andy acquired the majority of the business from the original developer that built it, and rado is in an interesting position in the sense of once they acquire customers, their retention is extremely high. But most people who need the tool are either unaware they have a problem or problem aware, but they’re not even solution or product or most aware. And we talk about that dynamic in the show of how difficult that can be and how it can be a bit of a headwind to get over. But to Andy’s credit, he’s making progress and growing the business month to month and has figured out some interesting approaches for getting around that. 

Before we dive into the episode, I have a Kickstarter that’s launching a week from today. It’s for my new book that I co-wrote with my wife, Dr. Sherry Walling. A book is called Exit Strategy, the Entrepreneur’s Guide to Selling Your Business Without Regret. Sherry and I have taken our combined many, many years of experience going through exits, counseling founders, through exits, and it’s not just focused on SaaS, it’s all types of businesses, but obviously there’s a light emphasis on SaaS because of course we do have more of a network in the space. But if you’d consider backing the Kickstarter, you can head to exit strategy book.com and click back the Kickstarter button and we will be in touch the moment it goes live. Could really use your support first. 24 hours is a great signal to everyone that if there’s a lot of backers, then we tend to get more. So exit strategy book.com if you’re interested in that. And with that, let’s dive into my conversation with Andy. Andy Kim, welcome to the show. Hey,  

Andy Kim:
Thanks for having me.  

Rob Walling:
Yeah, thanks for joining me today, man. So you run rado, that’s Trot two, and the H one is easy and secure. Go links, quickly share and remember links by shortening lengthy URLs. Try for free. the hell is a GoLink?  

Andy Kim:
That’s a good question. So most people probably have not heard of a GoLink, but the way to think of it is a UR L shortener. The consumer version of this is Bitly or Tiny URL, but GoLink specifically only work for people within the same organization. So whereas you would use Bitly to shorten our URL for marketing purposes to the general public where anyone can click on that link, goal links only work if you and I work at the same company. And the purpose is really to share resources between each  

Rob Walling:
Other. Got it. So folks understand you are a SaaS, you charge per seat, right? Per user. And when I think of Bitly and what was the other one, tiny URLI think of these big kind of freemium, consumer cheap plays, but you are much more on the enterprise side.  

Andy Kim:
Yep.  

Rob Walling:
Isn’t that right? Okay. So talk us through how that, it’s like two sides of a different coin.  

Andy Kim:
Yeah, and if you remember, Rob, when we were actually interviewing for TinySeed, you were questioning why do companies even pay for this, right? It’s an interesting phenomenon, but the reality is this is what I call enterprise software tool that works. The larger the company is, the larger the problem becomes. So there’s really three use cases I’d say, and then individual use. But the way that we break it down between those three, sometimes there’s good overlap, but really the fundamental problem is, hey, Rob sent me a resource three months ago and I don’t remember where he sent it, email Slack. He might have told me over a video conference, but Go Links basically helps you remember where to go because a human readable link most of the time, that’s a lot easier to recall.  

Rob Walling:
Got it. So as an example, then if I wanted to implement Go Links in for TinySeed, I would install a browser plugin, and then I sign into my Go Links account as a TinySeed employee. And there’s what is TinySeed team? Six or seven of us. So six or seven of us would all sign in, and then I can type in to my browser. Let’s say I’m in Chrome TinySeed dot com slash some internal short code, like a R’S deck. And we know an R’S deck is the deck. That is not a great example, but some type of short code. And now that has to then point somewhere, right? It points to a Dropbox location or some URL doesn’t store the files themselves. It literally is just a hop.  

Andy Kim:
We don’t store or host anything. Yeah. Got it. And actually you would just type in Go slash Einar file and that would be it. You don’t even have to do the TinySeed portion.  

Rob Walling:
Yeah. Oh, go. So it doesn’t need to be a TLD. It’s literally because the Chrome browser is  

Andy Kim:
Correct.  

Rob Walling:
The Chrome plugin, I’m sorry, is going Ah, go slash a R’s important resource.  

Andy Kim:
Yeah.  

Rob Walling:
So is this a real problem? Who’s paying for this? I guess it’s like who uses this? Someone invented this and it’s somehow popular. What’s the story?  

Andy Kim:
Yeah, this was started back in the early to mid two thousands at Google. We actually have a very cool interview with a couple of the people that started this at Google on our website. You can check that out. But basically folks at Google were asking to set up these redirects. So they would say, Hey, I have a holiday party. I’m planning for all of Google. It’s really hard to communicate this to 10, 20, 50,000 people and it’s going to be go slash holiday party 2007 for example. And they communicate that to Google, and these engineers were setting up these redirects internally for Google and they thought, let’s set up a service for this so that anyone can just self-serve themselves. And what ended up happening was as this just exploded in popularity at Google, folks left Google, they would go to LinkedIn or Netflix or any other large tech company and they would set the service up for themselves. And that’s really what happened with John, my co-founder as well. He worked at Google, went to a startup, wanted go links, set it up for them, other folks kept on coming back to him and asking him to set it up for their startup. And he’s like, bang idea. Let’s make this a service.  

Rob Walling:
Got it. So then this is independent. The concept of Go Links has been built by hand inside Google and other Silicon Valley startups, and then Rado is a self-serve version of not Not right, but it’s a SaaS version of the same thing that John kind of obfuscated out. It’s such a trip, it sounds like still to this day, I am like, don’t know. I don’t feel like I need this myself. I don’t feel like I need this, but it’s obvious you have clients like what Figma? I mean you have big enterprise, any other notables,  

Andy Kim:
A couple of Fortune 500 companies for sure.  

Rob Walling:
So it’s for them to pay for it and your pricing’s on your website, it’s a $3 per user. Got it. I can just extrapolate to, these are not small contracts, these are enterprise size contracts, so it’s obviously for there to be enterprise contracts around this is something that if you haven’t used it, it doesn’t feel like a pain point, but when you use it and get kind of addicted to it or get used to it perhaps that the next company go to, you’re like, I got to have this. Is that really what?  

Andy Kim:
Definitely.  

Rob Walling:
Okay.  

Andy Kim:
That’s definitely it. I mean, we can see it in our user base. So there’s, depending on the company, there are 20 to 30% of users that use this more than five times a day. Anything that they’re going to, they’re using a goal link to get there. There are others that may be more like you who only use it once a month if that, and it’s because I as a power user sent you a link. But what we find is that the adoption rate of this within a company doesn’t stop at 20 or 30%. It’s like 70% average usage per month for all of the employees at a particular company. Once they’ve fully adopted this, it’s a daily weekly tool that folks use regularly. It just becomes part of your normal workflow. You don’t look to bookmark things, you just know that a Go link exists. So think of it as a bookmark placer, think of it as a memory helper, all of that.  

Rob Walling:
Interesting. Before we get further, I want to dig into the story of rado and how you’ve been growing it, but can you give us an idea of where the business stands today?  

Andy Kim:
Yeah, we’re profitable, which is great. We’re six figures in revenue. The story generally is John built an awesome product. It stands up on its own. We have SOC two, type two, we have a bunch of different services including SSO. We have a Slack app. So all of the pieces are there that John built, but he was a classic founder who focused more on the product itself rather than a little bit more on the sales and marketing piece of it. And that’s kind of where I come into the picture and that’s kind of where we are today, which is you’ll talk about probably some of the issues that we may have, but that’s the problem we’re trying to solve for is how do we get awareness out there about what Go Links are and also why Trato is the best option for someone who is looking for Go Links. And that’s really the crux of where we are today.  

Rob Walling:
That is, that’s the next thing I want to talk about is you have, I talk about on this podcast, five stages of awareness from Eugene Schwartz and its unaware, problem aware, solution aware, product aware, and most aware in that order. For most people, they’re just unaware, like I was unaware of this before you interviewed a TinySeed. But then there is a different subset that is problem aware, and the problem that they have is, I used Go Links at insert name of startups, I’m at the new place of employment, and my problem is I really want those, right? But they probably aren’t aware that there is a solution to this, and I imagine they think I need to get engineering to build it. We had a custom one at the other thing and the IT department or whatever maintained it. So how do, as a founder who’s trying to grow this business deal with that of, Hey, because in a perfect world, you’re at stage one and two, you want to be at four and five, you want to be at product, everyone’s product aware, Hubspotter, Salesforce or Shopify or everybody’s most aware, whatever, it never happens, but you’re all the way at the other end, so it feels like a headwind. 

How do you think about that as a founder?  

Andy Kim:
Yeah, I think if we were trying to get every company in the world to adopt Go Links, that would feel like an impossible task. Just boiling the ocean. You’re never going to be able to get the attention span of everyone out there to be able to do that. So that’s not something that we really think about. We’re trying to solve for, Hey, folks that have already used Go Links say, and you can pull folks that used to work at the Googles and Netflix is the big tech companies of the world, and oh, they work at a new company now, and that becomes our ideal customer profile. These people probably have used Gox before, and in the best case scenario, they’ve loved Gox. I’ll give you one example. We reached out to the CTO of a very large tech company, a Fortune 500 company, and they didn’t have Go Links and responded immediately to a very cold email outreach and they have I think north of 10,000 employees, and it was an instant conversation. He was selling Go links to the other people on his team on that call. It was great. Now we have to go and close that deal, and there’s other considerations like budget and timing and all of this, but that’s the kind of power of, Hey, if you’ve used Go Links before and it was part of your workflow, this is an easier sell than most. But the problem is if you haven’t used Go Links, then you fall into Rob Wallings world where you’re like, why the heck would anyone buy this thing?  

Rob Walling:
A real customer education challenge, right? In that because you’re not inventing a new category, the category exists, but it’s not a big category yet. It’s not DocuSign like electronic signature or scheduling links or marketing automation or something where it’s this massive thing with dozens of competitors, if not hundreds. It’s this, and this is a conversation, and I’ve had when you interviewed for TinySeed was like, how big can this get? How many pasta? I mean, I guess over the course of 20 years, as people move to a new job and moved a new job, it’ll eventually propagate. But today, how do you think about that as a mostly bootstrap startup? I’m presuming since you’re in TinySeed that you want to get two, seven or eight figures in a RR. Yeah. And how do you think about that?  

Andy Kim:
Yeah, I think what’s exciting for us is that what we’re seeing is true. Our target market continues to be technology companies, but there are non-technology companies, say in automotive, industrial healthcare government, and that is wide open greenfield opportunity for us. And they are, I would say, in a sense, starved of productivity tools like Go Links that technology companies use every day and take for granted DocuSign. CRMs are just one classic example of that, but there’s so many other niche kind of productivity tools that if you work at a tech company, you’re like, oh yeah, of course this works. Of course this works. And that kind of migration from technology companies to non-tech seeing that live in our pipeline, and that’s what I’m most excited about because you’re right, it’d be one thing if it was kind of slowly moving across tech companies. That’d be a slow growing market, but because we have non-tech companies adopting this as well, that’s kind of what I’m most excited about. For example, we have a nonprofit customer who said, truly when new employees join and they use Go Links, and they were working at other nonprofit before, it is just magic. It just works. And that’s kind of the magic that we’re trying to achieve. Not just that tech companies, but non-tech companies.  

Rob Walling:
There are actually quite a few products and TinySeed that are hard to get the deal signed, but the retention is through the roof. It’s like there’s net negative churn, frankly. And it feels like Rado is that kind of product. Would you that? Yeah,  

Andy Kim:
I would agree. I mean, we have customers who have been with us for four or five years now, and the companies are growing, which is great for us. Again, we charge per seat, but we see the, hey, new people join the company. They start using Go Links, and it just expands the overall pie for us. And that’s exciting for us, and that’s what we’re really trying to achieve.  

Rob Walling:
And so I’d imagine that your marketing or slash go to market motion has to all be outbound because I can’t imagine there’s much search volume or even much conversation in Facebook groups or Quora or Reddit, all the marketing. I have 20 B2B marketing approaches in SaaS Playbook, and I’m guessing 19 of them don’t work. I mean, I’m sure in person event there’s some things that could work, but it seems like you would have to be going out there finding people.  

Andy Kim:
Yeah, that’s what we’re really trying to solve for is what is the repeatable marketing funnel that works for us? We’ve tried outbound email, we’ve tried Google AdWords, of course, we’ve tried all the different kind of playbook items, and we’re still really searching for what is the best solution that says, I can put in X amount of effort and time and money resulting in why leads that part of the funnel we have not yet solved for yet. And that’s part of the journey that we’re on.  

Rob Walling:
Yeah, that’s the stage of a lot of most listeners to this show are in that stage of trying to figure out what’s the repeatable thing that I can scale up. I remember it was interesting in some of my earlier software slash SaaS companies, I found one or two channels that I could really crank up and really get a lot of volume out of. When I launched Drip, I remember being like, yeah, I’ve got to find that one or two thing, one or two. And it never happened. It was just a bunch of things. I don’t think there was a single kind of traffic source, so to speak, that was more than 15% of our monthly trials. So we had, oh, 

Yeah. And it was all time I was running, I was dealing with Facebook ads. I was paying somebody to run those. We were doing SEO, I was doing podcast tours, we were had an affiliate program. There was all kinds of stuff. And it was just all that’s great for kind of diversification so that no single source can crush you. It also kind of sucks because I had to manage all of that, and we were, at the time, we were a four person team, five person team. And by the end, by time we sold, we were 10, but oh, we were doing cold outbound as well. I mean, we were doing all of it, and it was all kind of working. It was all working well enough, and as a big, it got the snowball going, and the growth was really good. I mean, that’s one of the reasons we got acquired was we were picking up market share so fast, but I found it frustrating to be on this small team and be like, I don’t want to manage all this crap. I needed a marketing team of six or eight people probably, and it was me, halftime, and a full-time junior marketer, and then our customer success person halftime. And it was always frustrating. It is not a myth to be like, Ooh, you’re going to find one or two things that work, but it’s really hard. It takes a lot. It doesn’t just take a lot of trial and error. It just doesn’t work in all spaces or with all categories where you’re just going to find that single silver bullet, so to speak.  

Andy Kim:
Yeah, I agree. This is actually a common topic for our TinySeed Masterminds group actually of, okay, we have a product that we think is working now, how do we reach the right people at the right time? And I think that’s actually some of the value in the community as well, right? Because I mean, I just use the Slack channel all the time to ping people and be like, Hey, we’re thinking about trying this. We are doing this. And just people that have been on that journey before is just super helpful to get all of their thoughts.  

Rob Walling:
Yeah, it’s definitely helpful to learn from those who came before you. That’s whether, if you’re in TinySeed how to do that. If you’re in the MicroComp orbit that’s MicroComp Connect, or even listening to this podcast and hearing the experience of folks and reading the books and all that, hiring senior developers can really move the needle in your business. But if you bring on the wrong person, you can quickly burn through your runway. If you need help finding a vetted senior results oriented developer, you should reach out to today’s sponsor lemon.io. For years, they’ve been helping our audience find high quality global talent at competitive rates. And they can help you too. Don’t just take my word for it, listener. Dylan Pierce had this to say about working with lemon.io. The machine learning engineer, they helped me hire was very professional and even learned a new tech stack to set up an environment to train and deploy machine learning models. He documented his work clearly so I could train it in the future with additional data. I’m super happy with the results. And longtime listener, Chaz Yun hired a senior developer from lemon.io and said his hire quote, definitely knew his stuff, provided appropriate feedback and pushback and had great communication, including very fluent English. He really exceeded my expectations. Chaz said he definitely used lemon.io again when he’s looking for a senior level engineer to learn more and get a 15% discount on your first four weeks of working with a developer head to lemon.io/startups. That’s lemon.io/startups. 

So I want to switch it up a little bit and ask you about the, I’d say the unorthodox way that you came about being a co-founder of this company. So your co-founder John built it and got a first big customer in 2020, and then you came in, it was either 2023 or 2024 last year, and you bought into the business and he’s now a minority owner. TinySeed obviously owns our percentage, but tell us a little bit about how that went down and who came up with the idea. Again, it’s unorthodox, and I like to tell stories on this show to give people an idea of, oh, that’s possible. I didn’t know you could do that. Right? And then when I heard your story, I was like, huh. Yeah, it’s an interesting way. So walk us through what happened.  

Andy Kim:
Yeah. So I have been interested in my own startup for the longest time. I can’t even begin to tell you how long it’s been. And part of the problem was how do I stand something up? How do I get the first customer? How do I get the first product out the door? How do I get first interest? And that to me was a big enough barrier that it felt like diving off the deep end. What ended up happening was I’ve been looking for businesses to buy on various marketplaces, and one that came across for me on Quiet Light was John’s business, this Rado business. And John’s part of the story is really, he built this thing to be sustainable, but he has a full-time job as a software engineer, and this business just wasn’t getting enough care and attention that it needed. And admittedly, he probably stubbed his toe with other partners in the past, but with me buying in, it’s a real capital commitment to growing this thing. 

And I think at the end of the day, what mattered the most and continues to matter the most to us is the level of trust that John and I have built over the last year plus of, Hey, John, I’m taking care of his baby, basically his company, and taking it forward. And he’s there as support on critical issues that he has the experience and knowledge about, and it’s actually worked out better than I could have really imagined for I think both of our cases. And it’s something that I’m super happy about and excited that it’s kind of turned out the way that it has.  

Rob Walling:
Did you and John know each other before this?  

Andy Kim:
No, we did not.  

Rob Walling:
Okay. How did you find each other?  

Andy Kim:
Through Quiet Light, the broker?  

Rob Walling:
Ah, very nice. I didn’t know that Quiet light would do majority, but not full acquisitions.  

Andy Kim:
Yeah, I think at the time I also wanted to acquire the full business, but in conversations as John and I built trust, I think John wanted to retain a certain percentage, and in retrospect, it was probably the right outcome for both of us to make sure that our incentives were aligned. So he’s still involved  

Rob Walling:
With the business.  

Andy Kim:
I mean, we used to catch up every week. It then turned into every two weeks. Now it’s on a monthly basis. But yeah, I ping him all the time on Slack and bother him with questions, and yeah, it’s been  

Rob Walling:
Great. As we move towards wrapping up, I have question for you that I like to ask of a lot of guests that come on the show, and it’s, in your experience running, growing, building this business, what has been the hardest thing about it? And you can either say overall like, Ooh, it’s been X, Y, Z challenge. Or if there’s a moment where you were like, this is so I’m not having fun at all. You can also just go to a moment.  

Andy Kim:
I don’t have a moment, but it is the general feeling of not knowing what the right answers are. You go to school and you’re like, okay, I got an A or B on that test. You go to work and you’re like, okay, I know I’m doing well or I’m not doing well. You know what the company’s doing, but you’re a smaller part of it when you’re at the size of company that we are. And it seems like at times we’re flailing in a large ocean of everything else that’s going on. The real question is how do you know what your North Star is? How do you know that you’re making progress against that, and how do you try to figure out the basic problems of going from basically nothing to a company with processes and with people and with all of that? So I think the general frustration of the question is all of the effort that we’re putting together on this thing worth what we think it’s going to be worth, that’s the real crux of the problem. And again, on the marketing side, you can truly spend unlimited amounts of money into all of the various methodologies and end up with nothing. This is not a game where you are guaranteed results, and I think that general kind of frustration is the toughest part of this entire journey.  

Rob Walling:
The uncertainty, yeah. It’s not just the money, it’s your opportunity cost, man. You could get a job working for a company in the Bay Area and make lots of money, and yet you are basically, I’m guessing, taking a below market salary as most of us do, and just trying to figure it out. And that is a real, it’s a gamble, kind of the traditional, maybe Silicon Valley or YC founder is like a 23-year-old founder doing it or having a this and that, and there’s a reason for that stereotype. Most of the MicroConf, TinySeed startups of the rest of his ecosystem tends to skew a little older, let’s say thirties and forties, some folks in their fifties. But the further you get on and the more you’re making three 50 grand a year as an engineer, senior engineer for Facebook or something, it becomes really hard to leave that for the uncertainty of a startup. And I think it is. I mean, it’s just one of the big concerns that folks have.  

Andy Kim:
Definitely the uncertainty though also makes it a little bit more fun when things do go your way and you do figure it out. And truly, I think that we would have some difficulty if it wasn’t for the TinySeed community, just like being able to call you or call a and r or the mastermind group that we have. It’s just super helpful to be like, okay, I’m not in this alone, and here’s how we’re all going to get through it together.  

Rob Walling:
Being alone in the uncertainty is even harder and being alone and having a spouse or a family in the uncertainty, and it’s like, well, I’m going to spend all these nights and weekends for at least you’re able to do it full time, hopefully mostly during the day. But the boots, I bootstrapped five companies and then raise money for TinySeed, but four of them, I did effectively nights and weekends, and it was not fun. I had young kids and I was telling Sherry, my wife, so all this time I’m putting into this thing. By the time I was on the second one, the first one had made enough money that it was like, okay, I’m going to do this again. And I kind of know what I’m doing now and now Fred. But the first one was a real tough sell. When our friends were like, let’s go to happy hour. 

And I’m like, I would love to. Or I’d go and I’d leave early. I was like, dude, I got to get home and write some code on this thing. These are the trade-offs, the unseen, unseen trade-offs of entrepreneurship, but specifically bootstrapping of any kind is just a lot of grinding hours. So Andy Kim, thanks so much for joining me on the show. If folks want to keep up with you on X Twitter, you are at rado hq. And of course, if folks want to check out Trot, thanks again. Thanks again to Andy for coming on the show, and thank you for listening this week and every week. This is Rob Walling signing off from episode 739.