Show Notes
In this episode of Startups For The Rest Of Us, Rob and Mike revisit eight things they wish they knew when they were starting out. After five years of additional knowledge and experience they share some new tasks on the topic.
Items mentioned in this episode:
Transcript
Mike [00:00]: In this episode of Startups For The Rest Of Us, Rob and I are going to revisit eight things we wish we knew when we started out. This is Startups For The Rest Of Us episode 234.
Welcome to Startups For The Rest Of Us, the podcast that helps developers, designers, and entrepreneurs be awesome at launching software products, whether you’ve built your first product or you’re just thinking about it. I’m Mike.
Rob [00:23]: And I’m Rob.
Mike [00:24]: And we’re here to share our experiences to help you avoid the same mistakes we’ve made. What’s the word this week Rob?
Rob [00:27]: Well, by the time this episode airs, I will be heading to San Francisco for Microsoft’s Build conference.
Mike [00:34]: Interesting. So how’s that going to work out?
Rob [00:36]: Yeah, because when we were offline you said, “Oh, because of all the .NET development you guys are doing these days,” because we’re [?] now, but Drip has been asked to be part of one of the Microsoft programs, and it’s kind of a nice little enterprise deal for Drip. They bought a bunch of licenses and they’re going to be implementing – I obviously can’t give too much. There’s an NDA until they announce it, but they’re integrating it into one of their big programs, so they comped us a booth there, and I think I’m recording a couple podcasts while I’m up there, and doing some lightning talks – couple fifteen minute talks about marketing automation and that kind of stuff. So, if you find yourself at MS Build give me a tweet @Robwalling or just swing by the Drip booth, and I’d love to connect with you.
Mike [01:15]: Very cool. So, I’m still trying to catch up on work after MicroConf. I don’t know about you but –
Rob [01:19]: Yeah, same thing. I just about dug myself out of email as of yesterday.
Mike [01:23]: Yeah, it’s funny. I dug myself out of email, and I was down to I think two or three, and now I’m back up to several dozen again. It’s like, “Oh, just let it stop.” It’s almost like the post office. You wish you could opt out of email, like all email, at some point.
Rob [01:35]: I know. My executive assistant I hired has been really helpful over the past two weeks because I went heads-down on MicroConf, and then she just kept everything sorted. And, it’s not that I’m getting any less email, in fact I’m getting more email each month, but she kept stuff in the this week and the today tab. So, when I came back I really only had maybe fifty emails that I really had to respond too, and typically when I come back from MicroConf there’s like between 3 and 400 emails that I basically have to just spend a few hours sifting through and replying to. So, she saved me quite a bit of time. It made me realize she’s only saving me, whatever it is 20 minutes a day, maybe, 20 to 30 minutes, but over the course of a week of not checking email, that time really adds up.
Mike [02:14]: Yeah, but that also comes down to the fact that you have to be using that time for good.
Rob [02:19]: I’ll say.
Mike [02:20]: Because if you end up wasting that time anyway, it doesn’t really buy you anything.
Rob [02:22]: Right.
Mike [02:23]: I definitely use to have that problem where I’d save some time in certain areas, and then I’d just end up wasting it elsewhere, so I wasn’t really gaining anything. So, this week I’m testing out a Thunderclap campaign. If you go over to thunderclap.it – somebody described it to me as sort of like an aggregated buffer app. So, what you can do is go over to thunderclap.it, you can set up a campaign, and you invite people to essentially help promote whatever your product or service is, and it will schedule people’s tweets, or Tumblr posts, or Facebook posts to all go out at a specific date in the future. There’s specific limits about how many people you can invite. There’s different levels that you have to meet, or you can pay for it to just go out no matter what. If you pay for it, then it’ll give you additional benefits of the service, so they have, essentially a freemium model.
It’s interesting because you can invite all these people to promote something that you’re doing, and then at the designated time, they all basically go into the social networks all at the same time. So, if you get a hundred people contributing, and each of them have say 2,000 followers, for example, then you get exposure to like a hundred times 2,000 people, which can be pretty significant. I mean, the time window for that exposure I think is pretty limited, but at the same time, you can get a lot of exposure all at once as opposed to doing it piecemeal and trying to get it throughout the course of like several weeks or months.
Rob [03:44]: Yeah, it’s certainly convenient. I had never heard of this before. I’m assuming it’s a new service, but it’s certainly convenient, and you’re using it for your book launch right? Your Single Founder Handbook comes out in a couple weeks, and at a certain date, at 11am Eastern, all of these tweets, and tumbles, and Facebook posts are going to go live all at once. So, I’m curious to see what impact it has, and to hear back about the experiment.
Mike [04:03]: Yeah, me too. It’ll be interesting just to kind of watch and see what happens. If nothing else, I mean, it’s not like I spent a whole heck of a lot of money on it.
Rob [04:10]: We have some new iTunes reviews, several new reviews actually. We have 417 worldwide reviews, and the most recent are from Trevor Jaye. He says, “Motivational, educational, and entertaining. These guys are great, and the fact that they can put out such great content every week is amazing. I highly recommend anyone looking for a bit of inspiration to tune into these guys as much as possible.” We also got a five-star review from Zach Kessin. He says, “Don’t make all the mistakes yourself. Learn from these guys who are sharing what they know so well.” So thank you very much for the iTunes reviews. If you haven’t given us a five-star review, we would love it if you would log into iTunes, or Stitcher, or Downcast, and you don’t even need to write out any sentences. You can just click the five-star button. We really appreciate it; it helps us keep the show going. It’s motivation for us, and it helps us rank higher in iTunes, and it helps more people find us.
Mike [04:57]: So, I remember reading a blog post from Joel Spolsky years and years ago, about something that they were doing where the interesting part of it was that the CEO was basically dealing with all these printer issues to print labels and manually send stuff out, and I’ve realized that he wasn’t joking when he said that sending products out manually was a logistical nightmare.
Rob [05:17]: I endured the same thing when I initially sold my book. I think I sold 300 copies, and then I had to fulfil them, and I had no plan in place to do that. It’s a lot more work than you think it is to pack 300 books.
Mike [05:27]: It is. It’s way more work than I thought it would be.
Rob [05:30]: I wound up hiring a local college student to come for an eight-hour day and basically fill out custom forms. This is before stamps.com, or at least before I knew it existed, because that’s what I would do now is get the scale and have someone do that. I actually had to go to the post office and do it. So, you had to fill out custom forms basically by hand. So, I had her come over for about eight hours and paid her to affix labels and do all that kind of stuff. It was well worth it. Even beyond that, I still had a bunch of logistical work of printing labels myself.
Mike [05:58]: Got you. Yeah, I found my wife had some things just laying around to be able to print the labels, so that was actually the easy part, but going through all the books and signing them all, that’s the part that really just takes forever. Instead of hiring a college student, I roped my wife into sitting there doing all that stuff for me.
Rob [06:13]: Or your kids, I think any one of those would be a good plan.
Mike [06:16]: I don’t know. My wife put the first couple of labels on incorrectly. They were in the wrong spot. The return address was in the middle, and I’m like, “What are you doing?”, and she’s just like, “I’m sorry, I just wasn’t paying attention.”
Rob [06:25]: Nice. Yeah, I have my eight-year old help sometimes fulfilling Drip t-shirts and books and stuff, and I will often have to correct his work.
Mike [06:34]: It’s almost like hiring.
Rob [06:35]: I know. It’s so hard to find good help, right? So what are we talking about today?
Mike [06:40]: Well, we originally did a version of this topic back in Episode 4. It’s been nearly five years, and the episode at the time was called “8 Things We Wish We Knew When We Started”, and I figured what we’d do is we’d go through that topic again, and see if there are different things that we would say now versus what we said then. So, I wanted to just revisit it. There’s five years of learning between when we did that episode and now. So, is there different advice that we would give ourselves, is kind of the main question. So, I copy-pasted the list into our outline, and I put that at the bottom. I didn’t really look through things before coming up with my list of four and you’ve got your own list of four, but I figured we’d go through them, and see how things are different now than they were five years ago.
Rob [07:18]: This is one of the most requested episode formats. We often get, “Hey you guys talked about x in Episode 15. What do you think now?” It’s pretty frequent, so I can see us doing several of these in the coming months; basically revisiting some old topics and giving a new take on them. It might be interesting to read our lists from Episode 4 before we start. My four from back in 2010, I guess, was that traffic isn’t enough, that one big link won’t make you successful, to thinking years not months, and that marketing and sales take as long to learn as software development.
Mike [07:50]: And my list was: number one, the amount of administrative overhead of creating a business is a lot higher than you think it is, number two, you can’t do everything yourself – outsourcing time consuming tasks is essential to success, three, don’t waste time making the optimal decision, make a decent decision and move on, and four, if it’s easy in the beginning, that’ll probably change – if it’s not easy that’s normal.
Rob [08:08]: Nice. So, let’s dive into what we’ve put together for this episode, kind of the updated takeaways. My first one is to play long ball – essentially, to think in years and not months. Like I said five years ago, I think that still holds true, and it’s something I really believe in, even having moved down the line now and been doing this for longer. I think that kind of ties into the stair-step approach that we talked about a few episodes ago, that I blogged about, that I’ve now had in talks. It’s that the odds are not great that you’re going to start something and have this grand success within a few months. That any time you hear about people doing it, there are typically some extenuating circumstances, that someone has tried five different apps, and then the sixth one caught, and grew really quickly. Or, if someone does it on their first app, that it usually is more of a Cinderella story. It’s a really unique outlier situation if someone does have quick success. So, think in years, not months, and go in it as a marathon, and look to play long ball instead of trying to get instant growth and instant success.
Mike [09:08]: Mine in some ways kind of ties into that theme or idea, because my first one is you can’t skip steps in the learning process. What I’ve realized is that if you try and reach too far, then things are just going to be that much harder for you. And, in some ways, I was kind of thinking about your stair-step approach in this, where there are certain things that you almost have to learn along the way. As you said, I mean, if there’s that Cinderella story, there are people out there who have gone from 0 to 100 in the first shot, but that’s not common. By skipping some of those steps, or trying to intentionally skip them, it makes it that much harder for you. You might as well have gone for something smaller in order to go through that learning process, because you have to go through it in some way, shape, or form. You’re better off doing some smaller things in order to get that experience and the successes under your belt, not just the learning successes but also the financial successes under your belt as you go through it, because if you go too far without those financial successes, obviously your runway’s going to fall short. So, you need to go through those steps in order to learn things as you go along.
Rob [10:09]: My second thing I wish I knew when I started out is the importance of relationships. Especially, seven, eight years ago, as I was really starting to come into fruition and have apps generate the majority of my income, I was trying to do it all on my own, because there really wasn’t a bootstrap community at that point, and I didn’t have connections. I didn’t have a mastermind group. There was no MicroConf . I didn’t have a network that I could leverage. People told me, “You need to build relationships.” Or, I’d read this in books, or hear it in podcasts or whatever. I didn’t realize how important that would actually be, and that having a community of like-minded people – how important that is, how much quicker and enjoyable it can make the journey, not only in ways of people helping you out, offering to promote your product, offering to give you feedback, but even the support of being able to talk to other founders and find out that what you’re going through is normal, and the hard times are what we all go through.
Having a mastermind group to talk to and get advice, some of the key insights of the last couple of years have come out of the two mastermind groups that I’m in. So, I think that if you’re trying to do this all on your own, and listening to a few podcasts, and you’re reading books, and you think that you’re just going to be able to kind of dive in based on pure knowledge and tactics and grow something, I think you’re missing out on a big piece of it, and I think you’re going to dramatically extend the length of your journey, and not in a good way. Right? You’re going to prolong the learning. You’re going to make a lot of mistakes that you would otherwise not if you had folks around to lend you a hand and lend you support.
Mike [11:43]: The second thing I wish I knew when I started out was that establishing trust is a critical step on your marketing path. I mean, I knew when starting out that people do not just come to your website and then buy from you. That’s not common behavior from most people. However, one of the things that I don’t think I fully grasped was the importance of all the different follow-ups and the individual touches from people, whether it’s emails, or different things on your website, or white papers, or phone calls, things like that. I don’t think I fully grasped how important all those little things are, because they add up to a level of trust that essentially helps convince people to buy, because people just online are typically in this mode of “no”. That’s their first thought. “Are you interested in this?” “No I’m not.”
I think it’s just very common for people who are browsing around on the internet, they see an offer of some kind, and their immediate answer is “no”. But, given enough time, and enough trustworthy touches, I’ll say, it essentially brings them over. Especially if they were interested in it at all. I mean, because they need to be able to trust you in order for them to buy into whatever the product or service is that you’re offering. And, it’s not going to be an immediate thing. It might be three or four emails or something like that, it might be an email course, it might be thirty or forty emails. But, you have to get through all of those different things to help establish the trust between you and the prospect in order to get them to essentially come over to the side where they look at it and say, “Hey, I trust this person enough to give them my money, and I think that I’m going to get value out of this transaction.”
Rob [13:09]: Yeah, and there’s varying ways to approach this. I think the two most common are to go out and build a personal brand and build an audience, and people then know, like, and trust you. This is done typically through blogging or podcasting or video blogging, whatever, Instagram, and people feel like they know you. Then you have some type of product you can sell them, whether that is a book, or a conference, or a physical product like Gary Vaynerchuk with wine, and that’s one way to do it. If that’s your thing, and you’re the personal brand type, and you want to build a personality and put in the time, it’s a long road because you have to put in a ton of time creating that content. That does not happen over the course of six months. It’s years and years of showing up every week and producing. I think some people come out and say, “This is the best way to do it, and the only way to do it.” And I totally disagree with that. I think it’s one approach.
The other approach is we see folks who build a software product. They build maybe a SaaS app and they establish trust not through a personal brand, not through blogging and putting out content every week, but through sticking around and building a product name that people start to associate with something, right? It’s essentially a brand, it’s trustworthy. So, you can see examples of this, like maybe with Bidsketch, or I think Baremetrics has a brand, and I think WP Engine now has a brand name. I would venture to say that in our circles, Drip has some kind of brand name. You don’t have to do it through a personal brand; you can build trust, like you said, with getting folks on a product email list essentially, like an email crash course, and building a relationship over time and providing value. Then, when someone’s ready to buy, it’s not some type of cold sale, although it might start off as a cold touch if you’re sending traffic to your site through ads. But, if you nurture them over time through these various touches, you can build trust without having to do the whole personal brand thing.
The third thing I wish I knew when I started out is that certain products have one natural marketing channel, and that in most cases you shouldn’t spend time looking for others beyond that channel. What I mean is certain websites might get a ton of organic SEO traffic. An example of this would be my beach towel website years ago, or if you have an e-commerce site that has long-tail rankings, or if you have a WordPress plugin that ranks in wordpress.org, they get 80, 90% of their traffic from a single source. It’s a very natural marketing channel for that product, but the mistake that I made early on, especially, was to then try to take that product and double down on it, and spending six months or a year trying to find other marketing channels and grow it. Often times if you have a product with a single channel, this is what I call a step-one product, it really isn’t worth the time trying to make ads work or try to do content marketing for a WordPress plugin, or going outside of this single channel that is essentially free traffic.
Mike [15:57]: So, are there any specific criteria that you can think of that would essentially relegate different products into “this is the only channel where this is going to work”, as you said, the natural marketing channel for it? Are there certain criteria or characteristics of them?
Rob [16:10]: Yeah, typically it’s lifetime value. Typically if it’s a one-time sale, and the lifetime value is less than say, I’ll ballpark it at about $120. If it’s less than that, it’s going to be really hard to invest money and acquire customers, because display advertising, pay per click, content marketing, any type of outbound email, any of that stuff, you’re going to need to make more than a minimum of 120. Realistically around 200 is when it starts getting easier. So, if you have one-time sales, and you’re only making 30, $40 off a sale, you just don’t have a lot of choices. If you have a current price, and you’re making more than that, between 120 and $200 that’s when you can start thinking, “Okay, I’m going to invest into some SEO. I’m going to have some articles written. I’m going to start building that email list. I’m going to go beyond buy ads and really expand out.”
Mike [17:00]: The third thing I wish I knew when we started out was that in many cases, it’s better to not know anything about what you’re getting into. Two notable examples I can think of off the top of my head were MicroConf and my book. I think in both cases, these things turned out well, but I wonder, going into it had I known how much work it was going to be, if I was going to go through and follow through with it. I mean, it was something that I wanted to do, but I didn’t fully realize how much work and effort it was going to take. I think a lot of other people have comments on this as well. I think Paul Graham has also said this. Basically, just not knowing what you’re doing can be an incredible benefit because you don’t know how hard it is, and until you get into it you don’t realize it. In fact, sometimes until you’re done with it, you don’t necessarily realize how hard it was. So, you’re willing to take those risks, you’re willing to go through that learning experience because you didn’t know any better.
Rob [17:50]: Yeah, I agree with this, actually. I have found myself in the midst of some things that were worth doing, but they were harder than I wanted them to be. Had I known how hard they’d be, I probably wouldn’t have started them. MicroConf , like you said, is a great example. I think building an app from scratch and growing Drip is another example of the last two plus years of my life spent doing it. These are hard things and I think as founders we have to do them. I think that’s how we’re wired, and if we didn’t do them we would be unhappy, I think, in general. I think that’s kind of what we need to do, but being a little naive about how hard these things actually are I think is a natural benefit, kind of like forgetting how painful childbirth is or something like that. It’s an adaptation that allows us to revisit these pains and keep doing them over and over, in essence.
My fourth thing that I wish I knew when I started out is that having multiple products is good. I like the diversification, I like the experience you get. But, entering multiple markets is not good. This is a mistake that I made early on because there was no one around to tell me that it was a mistake. But, in essence, I feel like I probably wasted quite a bit of time in having multiple small products that were in disparate niches, right? So, I was selling beach towels to consumers, I had some e-books on just random topics that were totally unrelated, I had .NET invoice selling to, essentially, .NET developers, consultants, and some small businesses who wanted control of their data. I had a number of other products, and there was no overlap between the audiences. There’s an old marketing saying that I like, and it’s, “Selling an existing product to a new audience is good. Selling a new product to an existing audience is good. But you almost never want to sell a new product to a new audience.” That’s when it’s hardest, right? When you’re first starting out, you have to do that, but once you get one under your belt, my advice would be to not stray out and try to do this new market and new product thing again, because that’s when the time frame really extends and the learning is so painful. So, if I could do it all over again, I would have looked to take the initial audience of the first product or two that were successful, and double down on that, and essentially, find out what else they needed, and basically build or acquire products like that. I just think the flywheel and the momentum that you build serving the same market, there’s a ton of benefit to it.
Mike [20:13]: The fourth thing that I wish I knew when I started out was that community is everything. I think this relates back to number two for yours, but it’s hard to get by completely on your own. I think that when I started out, back in 2005 or so, there was a part of me that really believed that you could just kind of sit in your basement and work on stuff and things would work out for you. You didn’t need other people. Obviously, a lot of things have changed since then, but I feel like in the last five years it’s really emphasized to me the importance of having all those other people to rely on and talk to, whether it’s MicroConf , or inside a founder cafe, or just in a mastermind group. All these other people, just as you said, they give you direction, they give you these other insights about their experiences that you don’t have, or you’re not privy to, because you didn’t have those experiences. So, they can help direct you on the right path and keep you off of the wrong one.
Rob [21:01]: So, you actually had four more that you came up with, under the “others” category. So, these are like our four bonus things we wish we knew when we started out.
Mike [21:09]: And, it’s interesting. I wrote these down because I was just kind of brainstorming a little bit about what sorts of things that came to mind that either other people have brought to me, or I’ve kind of noodled around in the back of my head a little bit, but we’ll go through these four. The first one was that the more you learn, the harder it is to make decisions sometimes. This kind of goes back and relates a little bit to the fact that sometimes it’s better to not know anything about what you’re getting into. But, if you know a lot about something, sometimes it’s difficult to make a decision because you start thinking about all these “what if” scenarios. You think about all the different challenges and problems you’re going to have, and all these different things, and you view them as roadblocks. So, you sit there and you spend more time trying to think about how to avoid those roadblocks rather than actually sitting down, doing the work, and just saying, “Okay, I’m just going to plow through this, regardless of however long it’s going to take.” So, maybe it takes you a little bit of extra time to plow through them, but you are not procrastinating, you’re essentially wasting all that other time trying to think of ways around the problems that you haven’t even gotten into yet.
Rob [22:08]: Kind of the curse of knowledge, right?
Mike [22:10]: Yeah.
Rob [22:11]: Yeah, I think that the more I’ve learned, I have found it easier to make decisions, but I do think that I found it harder to give clear, concrete advice when people ask questions because I think of all the things that could potentially go wrong now. I see so many more pitfalls. So, I think in talking about it, I have – naturally I put up a lot more caveats. It’s always “it depends”, and there’s a lot of different variables and then you have to give ranges. I think things were so much more clear five years ago when I knew a lot less, and I could just emphatically say, “Yes, you should always do this. You should never do that.” The more I learned, the more I realized that that’s not the case, actually. That’s why I’m suspicious when people come out and use these words: always, never, should, because they reek to me of inexperience, of your view is not broad enough to realize that there are nuances to this and that none of these things are black and white. Very, very rare that you’ll find something that where “never” and “always” apply.
Mike [23:09]: The second one was that you’re never too old to become an entrepreneur. I actually had a couple of people joke to me leading up to MicroConf that, “Oh, I’m going to be the oldest person there.” The reality is it doesn’t necessarily matter. I mean, people have different career paths and different personal life arcs that go along with them. You can be 21 years old, you can be 65, you can be 75. I mean there are definitely entrepreneurs out there who are also advanced in their years. It almost doesn’t matter. You’re never too old to start something new.
Rob [23:39]: The third one is that knowing what you want or need isn’t as important as knowing why you want or need it. I think this depends on your time frame. I think if you’re early in your entrepreneurial career and maybe you’re trying to quit your job, I think knowing that you want and need it and that you’re willing to really drive for it and invest a lot of time, I think that’s as important as knowing why, because I think just getting there is such a journey that focusing on it is huge. Now, once you get there, you’re suddenly going to discover “wow, this isn’t all it’s cracked up to be”. It’s great, but it doesn’t fulfil you for the rest of your life, right, the arrival fallacy in that you get there and then within a few months you then need to start sorting out your “why”. I think that’s at every step. At every goal and big arrival that you think you’re going to have over the course of your 20, 30 year entrepreneurial career, I think first you need to decide on “what”, and then you’re going to get there and you’re going to achieve that “what”, and then you have to figure out “Why did I do that, and why did that fulfil me?” And that “why” that drives you to that next “what”, that next thing of what is it that I’m going to pursue and how am I going to kind of chart this course of starting businesses.
Mike [24:48]: Yeah, for me this one was more about understanding that the “why” is not about what it is that you’re achieving, it’s about the journey to achieve it. Your real goal isn’t necessarily to achieve whatever the goal is, but it’s to enjoy that journey, to go through it, and experience all the things that go with it. Yes, it’s great to achieve whatever the goal is, whether it’s $10,000 a month in revenue, or 50 or 100. That’s great, but knowing that your journey is essentially the driving reason behind it, at least for me, that’s the driving reason. Different people are going to have different thoughts about why it is that they want to achieve these different goals. But to me, it’s the journey that’s important; you have to enjoy life and to enjoy whatever it is that you’re doing. If you’re not enjoying it, then why bother?
And then the last one on my “others” list was “quitting while you’re ahead is not the same thing as quitting”. I remember this as a quote from the movie American Gangster. It just struck me as something that is fundamentally truthful, because you look at that and say, “Well, if you’re quitting, nobody likes a quitter.” But, at the same time, when you’re quitting while you’re ahead, because you know that other things are going to come along that are either better or are going to torpedo all the things that you’ve done so far, you’re essentially recognizing what your situation looks like and making a conscious decision to move on, versus being in a situation where you’re fighting a losing battle that you cannot possibly win. For example, a number of years ago where they were trying to create a calendar app. It was going to be all web-based, and then all of a sudden out of left field Google comes along and announces that they’re coming out with a calendar app as well. Instead of trying to fight against that machine, they did what I thought was a very admirable move, and just decided to kind of pull the plug and say, “We’re going to quit this. We’re going to go on and move on to something else.” They made that as a conscious decision and I think that’s the differentiating factor here, is that you’re making a conscious decision to move on versus fighting against a machine that you know you’re going to lose against, and folding up shop well in advance of that because you’re deciding to say, “Hey, look this is not going to work out. I recognize that. I’m just going to move on and I’m going to do something where I can be successful.”
Rob [26:47]: That wraps us up for today. If you have a question for us, call our voicemail number at 888-801-9690, or email us at questions@startupsfortherestofus.com. Our theme music is an excerpt from We‘re Outta Control by MoOt used under creative commons. Subscribe to us on iTunes by searching for “startups” and visit startupsfortherestofus.com for a full transcript of each episode. Thanks for listening. We’ll see you next time.
