Episode 560 | When to Hire, Square Business Banking, and More Bootstrapper News

Rob: Welcome back to Startups for the Rest of Us. This is episode 560 where we’re going to dig in to bootstrapper news. It’s news that relates to you as a bootstrap founder, mostly bootstrap founder. We’re going to talk about things like deciding when it’s time to hire someone, how to think about which role to hire next, talking about location and how it can force productivity. I chuckle because this is just a long time hack of mine and one of my guests today, Tracy Osborn, had a tweet a couple of weeks ago talking about being on a plane and how productive it makes her.

Today, I’m welcoming Tracy Osborn, the Program Director of TinySeed and Einar Vollset, the General Partner of TinySeed and my cofounder in this amazing epic adventure, this journey that we are on. The two of you have been on so many of these episodes now. I almost wonder, how should I reintroduce any of you, what is new, what do the people need to know.

Einar: Or maybe you shouldn’t. Maybe you should just be like, yeah, I’m once again with Tracy and Einar, the end.

Tracy: Don’t call attention to it.

Rob: There it is. Einar is in the UK. He’s actually just an hour outside London. I think I mentioned this in the outro of last week’s episode, but we’re getting started on raising our European TinySeed fund. If you are an accredited investor and interested in potentially investing in EU companies that TinySeed would be investing in over the next couple of years, you should hit them up, tinyseed.com/invest.

Einar: Because it’s an EU fund, I actually don’t know if the same accreditation rules apply. You may be able to give us money without being an accredited investor.

Rob: We’re in the early stages, you can tell. This is still being researched. In other news, before we dive into the topics, I want to let you know that MicroConf is back in person. MicroConfs are starting in September. Right now we have five scheduled in five weeks. That was a bit of an effect of the pandemic that we had to condense that, but we have one day local events in Portland, Oregon, Austin, Texas, Boston, Massachusetts, and London,

Then we have a two and a half day growth event in Croatia. It’s our third and final year in Croatia, that will be the first week of October. I think they’re going to sell out fast based on pent up demand and what I’m hearing from folks. So microconf.com if you want to get on that list and have a chance at tickets. Who else is excited for in-person events?

Tracy: Oh my golly, so excited. Get me out of here. Get me travelling.

Einar: Super excited. I can’t wait. I need to go. I’m just sad that due to the capacity constraints on the places, there can only be so many people. I’m like, come one, let’s do more people.

Rob: Yup, I totally agree. That’s what we’re looking at right now. We’re at half capacity in Croatia, but we almost expect the way things are going, probably open up a bit more and we can sell more tickets later, but I’m excited to do it.

Let’s dive into our first story, which is really just TinySeed making our first hire in over a year and a half? Because the […] started in September. This is the first time. We’re a small team, we don’t grow very quickly on purpose. It’s like a forcing function to do great work and to figure out when it is we need to make that next hire. We’ll link the job posting up in the show notes.

We’re hiring a remote community manager who’s going to spend time in the MicroConf community and also in the TinySeed community. The reason I wanted to call this out is we went into a whole process to decide, should we hire someone now and which role we should hire? It’s not always obvious like, we need another developer right now, we need a project manager, or we need a customer success person.

Tracy, you are part of this process obviously, what were some of the things that we did along the way to figure out that this is the role we actually need to hire?

Tracy: We got a lot done as a small team being that we have just four people across MicroConf and TinySeed. That worked really well for a while, but I started feeling like balls are not being dropped but I knew that if I didn’t have as much capacity as I used to. Then it was like, why do I not have capacity? What are the things I’m doing? What task could potentially be offloaded or what I’d like to be offloaded in order to increase capacity? That’s where it started with me.

I wasn’t thinking about hiring per se, I just started creating a list. And as I was going through my daily, weekly activities, as things popped in, I was watching out for things, oh, that’s potentially outsourceable. That’s something I could teach someone else to do. I just basically built this whole list and then I talked to you. It’s like, hey, Rob. Guess what? I’m feeling a little overwhelmed right now, but I’ve already created this list. Take a look at it. I think Xander was kind of doing the same thing on his end, right?

Rob: Yeah, that was the thing. Xander came to me and said, hey, MicroConf is coming up, starting to plan them. I have a bunch of stuff I’m doing over and over. I think that was the commonality between you and Xander. There are some admin tasks so we can hire a VA to do, but there is also some higher-level stuff where it’s like we need someone who’s a step up form of VA in essence in terms of skills set and focus.

You are keeping a list, I asked Xander to keep a list, and when I compared the two, it wasn’t a one-to-one mapping but we can start to fit it together. There’s still a bunch of stuff that a community manager probably wouldn’t be able to do that’s on that list that we’ll have to keep doing for a while.

The way I think about it is as we started TinySeed and continue with MicroConf, you make a lot of it up as you’re going and just figure out the process. By the time that you do the process, second, third, fourth time, it’s like, wait a minute, someone else could be doing this and I could be working more on ambitious things, more creative things that kind of drive it forward.

Einar, do you have thoughts on obviously both in terms of this process, but also advising all the TinySeed companies? People come to us a lot and say, who should I hire next? How do you advise founders when they come to you?

Einar: I think very often, particularly bootstrap founders end up hiring too late. It ends up in a situation where they’re like, oh, I’m overwhelmed, and then only when they’re super overwhelmed do they realize they have no choice but to hire somebody. I think often people should hire sooner than that.

We were talking to one of the founders two, three months ago and finally, they were like, should I hire? I don’t know. I’ve become so busy. I was asking, what kind of thing were they doing? And in this case, they were doing customer support 40% of their time.

I’m sorry, but if you are the founder then it’s valuable for you to do customer support, sure. You want to be closer to your customers, but it’s not valuable to the point where you’re spending almost half of your time doing customer support when it’s something that’s super repetitive, something that you can definitely hire someone at a reasonable price to do.

I think it comes with that bootstrapper mindset that you want to be frugal and things, but I also think you only have so much time. If you’re spending your time on suboptimal stuff, that’s not a good thing to be doing.

Rob: I would agree with that and that’s usually the first thing I recommend people hire for. It’s usually not outsourced but hired for is that support role. Even though yes, as a founder you can probably give better support in the early days, but as it becomes repetitive, I find that founders don’t give better support than someone who’s really good at it because you get tired, you get bored, and it’s not as creative.

Still handling the exceptions, the one-offs that get escalated to you I think is the way to go there. The other thing I was talking to a company yesterday and they’ve hired two support people, they’re all dialed in there, and the next hire is a developer. Because right now, one founder is doing all the code. When they go on vacation he has to take a laptop because if the site goes down, it’s getting the buzz factor out of there.

Tracy: This also applies to design. I was talking to the founders yesterday as well and doing your own design and all of that work for front end, user experience, and getting your onboarding flows and whatnot is also something I find founders hold onto as long as possible. It’s good for them to have a good understanding of how things work, but that’s also something that’s very easily outsourced and probably should be outsourced to someone who has more of an eye or specialty in that area to work on those very important front end experiences that users have.

Einar: On the flip side, I think when somebody sometimes just wants to hire for too soon tends to be sales. There’s a lot of times founders (particularly technical founders) are like, I’m not good at sales. I know we should do more sales, I just want to hire salespeople. The flipside of that is until you have a founder driven, if the founder hasn’t already done some sales that they can then train people up on, then sometimes that’s too soon.

Rob: I like to think of it as the moment it becomes pretty repeatable and rote, and this is whether it’s sales, customer success, support, or product development. In the early days when you’re going commando on a product, it’s like all over the place. My code would be everywhere, and then eventually I’ll refactor it, I’ll get all the deployment in place. Then it’s like, wait a minute, I can bring another developer here.

That’s the point of each of those where I start to think about whether I want to help bring someone in and then it’s just a matter of budget. As a bootstrapper, mostly bootstrap, you don’t have the budget to hire on all of those roles, so it’s figuring out which is going to leave me doing the most high-value tasks.

All right. Obviously, if you’re interested in working with Einar, Tracy, Xander, and I, head over to the link. It’s at dynamitejobs.com and you can check out the role for a community manager. Love to hear from you.

The second topic today is one I alluded to in the intro. We have a tweet from @tracymakes on Twitter, that’s Tracy Osborn. This is about a week ago, she says, “Can I be thrown on a plane every time I need to be productive. Geez, I’m working at like 10x speed.” Do you want to expand on that first and then Einar and I will weigh in because I have so many thoughts on this?

Tracy: Yeah. This was my first trip outside of Canada. Obviously, due to the pandemic, I went over to California to go see (that’s where I grew up) my family and all that. It’s my first time on a plane in a year and a half. I’ve been on planes a lot and I think it’s such a good hack. It’s so nice.

My husband kind of disagrees with me. He’ll be the kind of person who wants to play games on the plane. For me, it’s all about paying for the really expensive wifi, but then I’m trapped in a tube where the wifi is kind of crappy. I can’t really do much with it other than go through all the emails that I’m backed up and do all the little tasks I have on my to-do list for so long. I can’t leave my seat, I can’t go get a snack, I can’t go play with my pets, and for some reason, the focus goes through the roof.

Also, having the limited time period knowing that I’m going to be on the plane, there’s going to be wifi availability for a max of three hours helps me timebox everything I need to do and get to be more efficient. As compared to when I’m home especially, I don’t have an office anymore and I’m working from home, it’s just like my time is free form. I can go get a snack whenever I want. I can take as much time as I want for a project unless there’s a deadline. I’m so happy to be back on planes, and it’s kind of a ridiculous way. But I think a lot of people agree with me and that productivity can vastly increase on a plane.

Rob: Einar, you have a tale of your own, whether it’s working on a plane or a location hack that you’ve used?

Einar: What I would not recommend to try to be productive is fly to London and be super jet-lagged as the heatwave hits where there’s no AC when your kids are not around in quarantine. That’s not particularly productive.

Rob: Hey, wait. That’s what you’re doing right now.

Einar: Exactly. This is the most productive I’ve been for a week. I think timeboxing things does make sense to me though. It depends on the kind of task, check on a bunch of different things I think works well. I still set aside (at least until very recently) two hours every Monday in the afternoon where just crappy things that need to get done just like checklist things like signing these things, finish this bit off, pay this bill, or respond to that email.

I do tend to feel super productive when I’m doing that because I’m not trying to do something super, super creative. I find that kind of thing sometimes, I can’t do it on planes. But just plowing through emails, paying a bunch of bills, just clearing the decks planning things tend to work pretty well for me too.

Rob: One hack I’ve used (and this is pre-pandemic, it was two or three days a week), I would spend half the day (usually the morning) somewhere that wasn’t my house or wasn’t my home office. Sometimes, if my kids were home, I would be in the basement at a standing desk. I didn’t have a coworking space, but I would go to a coffee shop and get super caffeinated.

A new environment actually for me causes a whole different mindset of creativity and thought. Again, I was doing that a couple of days a week, not super cheap because I was eating out, buying coffee, and stuff. I haven’t resumed that since the pandemic.

One of the biggest hacks that I’ve completely stumbled into accidentally is during the winter—so obviously in Minnesota, the very cold—we would sign our kids up for jujitsu at an indoor dojo. I hated it because it’s dark already—it’s dark by 4:00 PM or 5:00 PM. It’s sometimes 10 below, so it’s super cold. You’re loaded up with the kids and the face mask. It takes everybody 20 minutes to get ready.

You hop in the car, you drive in the dark, the roads are slippery, it’s twice a week. I would dread this thing, but I knew it was good for the kids. We got there, they got their energy out, it was a great thing.

I started bringing my iPad Pro with the keyboard. It doesn’t have Slack on it, it’s like a separate laptop that doesn’t have interruptions. This would be 6:00 MM 7:00 PM and I would open it up and the Gmail app, which is like the iOS Gmail app. I could get through a week’s worth of email. Something that would take me five days, I can do it in 55 minutes because it was forced—it was like Tracy said—it was timeboxed. I couldn’t do anything else, and I would just boom, boom, boom, hammer through it much like in an airplane.

This was cool because it was once or twice a week and I started looking forward to it secretly, even though I hated the drive and the cold. It was the worst posture. I was literally sitting on a linoleum floor with my back hunched over. You can’t do that for very long, but I could do it just long enough to get this work done.

Tracy: That’s one thing I wish we had in an office because of the experience of saying if you’re working with people in the office and everyone can grab their laptops, go into one of the rooms, just sit down, and work together on one task. Even if you’re not talking together or collaborating. Say going to a coffee shop, grabbing some friends. I’ll go into a coffee shop, sit around a table, and work together. You get these people around, everyone’s working, everyone’s being productive energy.

Rob: That’s awesome. Our next story is from Engadget. The headline is, Delta pilot sues the airline for allegedly stealing an app he designed. He’s suing for $1 billion accusing it of trade secrets theft. He basically paid $100,000 of his money to a software development crew to have a mobile app that would easily communicate disruptive fights, I think, to each other maybe, so some type of messaging tool. He contacted Delta CEO, or at least according to this article, he apparently contacted Delta CEO in 2016 after the computer system meltdown.

You remember this when all the flights were put on hold. It cost the company $150 million. He told the CEO, hey, I have a solution for that. He had several meetings with executives, and according to this, “who gave him verbal assurance that they were going to acquire his app.”

According to Alexander, the pilot’s complaint, Delta ended up telling him that his technology didn’t fit its need and ultimately launched its own Flight Family Communication app in 2018 and he called it a carbon copy knock-off of the role-based text messaging components of “his” proprietary QrewLive communication platform. Now he’s seeking a billion dollars, which feels like a lot. Anyway, I want to kick it over to you first, Einar. What are your thoughts on this situation?

Einar: My first thought is how does he even know? Depending on where he is, his contract might mean that if he was working for Delta at that time, Delta owns the app in the first place anyway. That was my number one thing. What are the IP assignments for all this stuff? Who actually even owned it in the first place, that’s probably my number one insight there.

The second thing is things change and it must feel sucky, but this I don’t think is super unusual. Who knows exactly why they decided to do it or not do it at that time. I have some sympathy but only limited sympathy. I don’t know if it’s worth a billion dollars. That seems like what he’s trying to do is to settle out of court for a reasonable amount rather than thinking he’ll actually get a billion dollars. A billion dollars seems a lot for an internal communications app.

Rob: Yeah, I agree. It’s interesting because when I read the story, I thought to myself, legally I don’t think he has much of a leg to stand on, unless he can prove they stole patented trades. He built software and you can replicate other people’s software, there’s no law against that. There’s the legal side of it.

Then there’s also the maker in me who feels like this sucks and that’s […] that they did that, but then also this only quotes from his complaint or his suit, so it’s his side of the story. I’m curious to see, I’ve seen some of these things that are written up on TechCrunch where I know both sides of it and I’m like, you didn’t represent this very well.

I wonder what was happening on Delta’s side. Maybe the app was […]. There are all kinds of reasons why they wouldn’t just want to use his version of it or not want to buy it, none of which are raised in this article.

Tracy: Yeah, and $100,000 of his own money is a really interesting number I think. For an app that would only work sounds like this piloting system, so he has to have Delta as a buyer in the first place, $100,000 of his own money before pitching the app over sucks. I feel like a lot of people in this industry kind of know that that’s not the way you’re supposed to do it, but I don’t think that’s widely known.

I can just see someone being very enthusiastic, getting his idea in their head, I can sell it to this company that I already have connections with. I’m going to put a bunch of money into it, but I will get a bunch of money back. Then not go through the diligence, spending too much money to develop an app.

On Delta’s side, they have a team of developers. They have their own app developers, they have their own app and what not. I don’t know if there’s an NDA or anything, or if that even matters. But to show this app that could or could not work very well, it’s very easy for Delta to be like, well, that is a good idea. We already have our developers in-house. Let’s just build this. It just sucks. This reads like someone who is really enthusiastic but didn’t do a lot of homework in terms of how these kinds of deals can go down.

Rob: Yeah, I think that’s a good point. As a founder listening to this who could potentially wind up in the same spot, I think it’s dotting your edge, crossing your T’s. Like you said, having NDAs, making sure your IP is locked down.

Tracy: Patents, that’s the whole reason why patents exist, I guess. I’m not sure if you can patent something like this.

Rob: Yeah, but it’s a messaging app. That’s the thing and that’s what I struggle with. It’s not the software, we always say that. It’s the marketing, it’s the brand. You either have to have something super unique or you need to have proprietary marketing channels that you can own, or sales channels because anyone can go replicate your software.

In fact, we did have people who basically copycat. I’ve had people who copycat pretty much most of the apps I’ve ever built, but at that point, it then became a question of brand and marketing. Could I secure the leads?

Tracy: Yeah, and he built something that he couldn’t market on his own because he built it for just one buyer and that one buyer said, no, we’re happy to do this on our own. I can imagine there’s another situation where he built something that he can sell to multiple airlines, drive competition, or something like that. Developing for just one buyer in mind feels like a mistake.

Rob: I don’t know that it was only developed for Delta. I wonder if it could work for any airline, but then it’s like, okay, cool. Go sell it to the other airlines then. That would be the next step to approve it.

The next story is a tweet that I sent out about a month ago and it seemed to resonate. It got a bunch of retweets, likes, and stuff so I just wanted to talk about it really quickly because it’s pretty founder-focused. The tweet is, “In the early days, you’re building a product. Once you’ve built something people are willing to pay for which is no easy task, you work on building a business. Once that flywheel is going, you move on to building a company. Very few founders excel at or even enjoy all three stages. It’s product, business, and company.”

I got some follow-up questions to that in the conversation, obviously, we’ll link it up, but I was defining the difference between a business and a company. A business is once you start looking at profit loss, you have enough revenue, you can start hiring, and it’s still early stages. A company is really when you’re starting to scale up. It’s like you’re starting to hit and escape velocity and really build out an org.

The reason I tweeted this is that it just continues to be a theme. I hear it on podcasts, I hear it in conversations with folks. I watch founders leave their companies. They grow it to $20 million and then they step down as CEO, and people say, why would you do that? It’s because I love building products, and frankly, I overstayed my welcome. Or I love building products and business which I’m defining as an earlier stage thing, but building out a company, building out an org is a different skillset. It really, really is.

That’s why 20 years ago, the venture capitalist would bring in “adult supervision”. The founder would go out and would bring in a seasoned CEO, COO, or whatever it is. Einar, what are your thoughts on this?

Einar: I agree with this. I think there are very few people who are very good at both of them. I think in some cases, you see data that says founder-driven companies are more valuable and grow faster than professional CEO-led companies. I do wonder if that’s just because founders of companies that are growing really fast are less likely to want to step away from it than companies that aren’t growing so fast.

I think in general it’s very true. I think once you get to a certain size, your job almost becomes HR. It becomes hiring. How do you source enough quality people to come on board, to work for you, and believe in the mission and all that stuff? I think a lot of people, particularly technical founders, don’t enjoy that. They don’t enjoy the organization building that you’ll need to do once you get past a certain size.

Tracy: I feel like you have to change where’s your dopamine rush? Is your dopamine rush from building that product and seeing people use the product that you built by hand or you had a large part in building? Then you have to switch that dopamine rush to watching other people do that process. Are you able to take that joy from seeing other people succeed and other people build a product and switch where your joy comes from the business? From enabling people and seeing the big picture thing. I feel like there’s a lot of people who are unable or unwilling to switch over where they get their joy.

There are people who make good managers and people who don’t make good managers. I think good managers—when they’re managing people—take the joy of just enabling people to do things. I feel like that broadly can be extended to building a company.

Rob: I really like that point. I think that’s accurate.

Einar: It’s true. At a certain size, it also becomes a question of instead of hiring a new professional CEO, that might be the point where you decide I’m going to sell this business because I don’t enjoy this stage anymore, and there are other people who can do better.

Rob: We’ve seen an example of that—Jason Cohen with WP Engine. He built it up and then I believe (I don’t know this for sure at this point) no one reports to him. He still works at the company full time, but he’s like an advisor and does pet projects (that probably diminishes what he’s doing), but he’s just doing projects he wants to do that he feels are valuable to the company.

Dharmesh Shah did the same thing at HubSpot. I remember asking him because he and I met 13 or 14 years ago. We were bloggers and then I moved into Boston. We were chatting at one point and I’m like, you’re going to go public someday soon, but you’re a maker. You’re a developer. He said, yeah, no one reports to me and I could work on what I want. I write company culture docs. I think what’s the next interesting problem that I need to solve for this company and I go do it. And I don’t have to manage people. It’s like at a certain scale you can do that.

I just named two massive multi-billion companies in essence. It’s harder to do that when you’re making $20,000 a month. But the point is that you hit a certain point in your company’s maturity where you do have to make that decision of am I the right person for this job anymore? Because in the early days, the CEO’s job is to make sales and make products, whether you’re doing it yourself, working with a cofounder, or you have an early hire. Then in the middle days, a lot of it is hiring, making sure there’s enough money in the bank, and it’s managing staff.

To Einar’s point, once you’re company building, it’s so much HR, maybe it’s fundraising, maybe you start getting into things where legal becomes a bigger issue. There are either incoming lawsuits or just managing GDPR. All the stuff that you don’t want to do when you just want to build a product to make $10,000 a month becomes a full-time job, plus, plus entire teams of people doing them.

Tracy: I want to go back to my point though. I think it’s funny because yesterday in TinySeed, we brought on your wife, Dr. Sherry Walling to talk to us about psychological issues. She made a point about—I forgot exactly how she phrased it, but it’s like being mindful of the joys and then finding things that you’re not taking joy in that you should be taking joy in.

I feel like if things like legal, those things aren’t really fun. But being mindful of this thing is not fun. I don’t like this part of the business, but I’m going to view it as a full ecosystem of the business. This legal work, this fundraising work, what is this enabling to do? And then thinking thoroughly about is this a good thing. Then if it’s a good thing, hopefully, it brings you some amount of joy, so therefore it becomes a little bit enjoyable.

If you don’t find some of these tasks enjoyable, maybe that practice will help you. It doesn’t mean that you have to then outsource it or hire someone or whatnot. I think there’s a little bit of balance there that people can do in order to make some of these lesser love tasks more fun.

Rob: Yeah, I agree. At the same time, you can get caught in a trap where you’re doing things that you don’t like for too long and that becomes burnout.

Tracy: Yeah, it’s a balance.

Rob: It’s like you can do it for three months, six months, and nine months and tell yourself I have to do this. Eventually like in my experience, you have to hire someone to do that. You have to hire it, you have to outsource it, you have to figure out a way not to do it if you really don’t enjoy doing it.

Tracy: You have to build a business and company, not just build a product.

Rob: And fire yourself. As a CEO you have to fire yourself from all the jobs over time, and it’s just picking what’s the next job I’m going to fire myself from.

The next story is about Facebook. It’s from bloomberg.com. Facebook Users Said No to Tracking. Now Advertisers are Panicking. IOS now asks for permission of whether you want Facebook or any app to be able to track you between apps. I’m opting out of all that, by the way. I get the prompt every time I open whatever, Instagram, or Facebook, and I say no. I only allow it in this app.

I guess only 25% of people are allowing themselves to be tracked across apps. How does this relate to the listeners of this podcast? I think that if you are making Facebook ads, Instagram ads, or really any ads that need cross-pollination. Obviously, this is mobile-only. So if you’re making web work, that’s less relevant. But I think the effectiveness of the tracking and basically the cost per click or cost per lead is inevitably going to go up because of this. Einar, do you have thoughts on that?

Einar: Yeah. I’m not surprised this was coming with the war between the business model that Apple has and the business model that Facebook and advertisers have. Apple doesn’t make a lot of its money from advertising, so they’re always going to err on the side of how can they sell more phones? And part of that is people are starting to get concerned about being tracked, people retargeting, and things like that. Apple is always going to be, I think, a company that errs on that side.

I think it ends up being tricky for advertisers in the end particularly when you’re trying to do things like retargeting, figuring out conversion, what adverts work, and where did this client come from. Even for a smaller bootstrapper, it’s going to start to become a problem if you have less and less data about what are your acquisition channels that actually are effective. If this becomes more and more of a trend, then I can see it really impacting people’s ability to optimize their marketing. You’ll end up spending more money, but less efficiently.

On the flip side, on the consumer too, you’ll end up in a situation where I know people who prefer targeted advertising because that means the stuff they see is more likely to be relevant as opposed to diapers for a 55-year-old man. I think there’s a balance there, but I can definitely see it being an issue.

Tracy: People have been saying for a long time that if you’re not paying for a product, then you are the product. This change through Apple is finally Apple saying, hey, you’re the product. They’re telling people directly you’re a product and I think that saying was well known between web-y people but wasn’t really known by the general public. Now that awareness is going out to the general public, oh yeah, Facebook is free.

Rob: “Free.”

Tracy: Yeah, exactly. They’re thinking, oh, that’s why it’s free. I do agree with Einar. It comes across so negatively, do you want to be tracked? And no one really wants to be tracked. I think that these ad networks, I think I’ve seen these on some places where it says, hey, we can give you more personalized ads. I think that those warnings, those better ways of spinning how things are going and why the tracking is there. Does Apple block it?

Rob: Apple did Facebook no favors on this because I believe it’s an Apple-generated message. You feel like they were digging it in.

Tracy: By the way, this is tracking you.

Rob: Yup, they stuck the knife and then twisted it on that one.

Tracy: You’re in the bathroom, it’s tracking you. You’re doing all these things and its’ tracking you. It’s very scary. Everyone is going to opt out of course. Instagram is a dumb thing. There’s an article recently talking about how Instagram is the new SkyMall and I totally agree with that.

The products on Instagram are nuts, but it’s kind of impressive when I’m on Instagram and how targeted those ads are to me. I would say that I wasn’t normally a person that would buy off of ads. Maybe I’m a little bit of a brat and I see ads on Facebook or Reddit, I deliberately don’t click on it because I’m being a butt.

For some reason, Instagram—because it is so targeted—actually has worked so many times. I have bought so many things off of Instagram ads. I can see overall, hopefully, this direction going towards more targeted ads in that way and these prompts maybe will have an evolution over time. But right now, I think we’re in a really weird period where people are realizing that they are the product finally.

Rob: The last story of the day is from Square. It’s not a story, it’s a release of their business banking, which is at squareup.com/banking. Square Banking, your payments, banking, and cash flow working as one. I love this. I don’t use Square, but I love the fact because banking is so last century. Everything I do with any bank is a disaster. The mobile apps are terrible, the process. Are you […] kidding me that we have a 2:00 PM wire cutoff to send money the next day in this day? Are you kidding me? That’s what we’re dealing with, right?

Given that we have crypto that I can send you in the next 15 seconds for pennies. That’s my banking rant. Given that we have Brex credit cards, which I really like using. I love their mobile app. Mercury Bank, Square Bank—these tech-enabled startup banks that are actually getting traction. I’m surprised Stripe hasn’t entered this. I can’t imagine they are not also entering this space given they wanted to increase the GDP of the internet. I’m super bullish on tech-enabled modern banks.

Remember when the web first came out, in the late ‘90s, they had these banks come out. It was like WebBank or bank.com and they didn’t have branches. You’d mail them a cheque to deposit because there were no mobile phones to deposit. It was a bit of a clunky experience.

I feel like the tech has caught up and that we are going to see actual really solid banking products that make our lives easier, much the way we used to use taxis and then Uber and Lyft came along. It’s a net win for us as consumers. I don’t want to go on the flipside of that, but I feel like banking is going to hit that, especially for business banking, which has historically sucked. Tracy, do you have thoughts?

Tracy: I wish I was as enthusiastic as you are. I’m very enthusiastic about these products. I feel very pessimistic about this because I feel like there have been such innovations in banking that I’ve been seeing pop up since the beginning of the internet. Is it because big banks have so much lobbying to change the regulations that are in the US? I can’t remember anyone that has popped up before.

I know there are several banking apps, credit cards, and things that popped up because it was like, oh, look at all the things we can do. It’s a new world. We can have all these fancy tech products, then they die and disappear because there are all these regulations, lobbyists, and everything that’s going on. I hope I’m wrong, but I look at these things kind of pessimistically.

I will continue to use them because I want them to succeed, but I’m also looking at them as there’s a very good real chance that these things are not going to need to payout. For example, Wealthsimple in Canada. They were launching a new savings account and investing thing, and they’re like, boom, we’re going to have debit cards you can use as a bank.

As soon as they announced it, I signed up for it. A year ago, I still didn’t have a debit card. I still can’t use those features, I finally moved my money out of that side of business because I don’t know […]. They’ve obviously run into problems trying to finish building out this whole banking platform. I will continue to use them, but I see so many problems happening that I’m looking at it being aware that it can just go away.

Rob: Einar, what do you think? Are you bullish or bearish?

Einar: I’m bullish. One of my good friends runs Mercury, so I can’t really be bearish.

Tracy: He’s going to call you up and be like.

Einar: I think banking has very low churn. Basically, people leave a bank when they die most of the time. I think there’s sort of inertia there with, well, it’s my money so I care a lot about my money. Do I really want to take the risk of going to some new fangle thing that hasn’t been around as long or I’m going to stick with the horrible mess that is the Bank of America, their 1992 websites, and all their stupid fees.

I think that’s the main challenge for some of these things. I actually think that’s why going into business banking first, at least, makes more sense because when you start a new business or a startup then you need a bank account, then that’s when you’re evaluating potential new things. It’s not exactly tied into your own personal flows of money that have been going on to the same places for years and years. I’m a bit more bullish than I think Tracy is.

Tracy: I usually pop up in here being the optimistic confident person and I feel like this is the one time I’ve disagreed with you both.

Rob: It’s all good. That’s why there are three of us on here to have that conversation. My take is that with Square behind it, they have more of a chance than a brand new startup. You see folks like Kickstart, a brand new credit card, blah, blah, blah. It’s like, yeah, I just don’t think you’re going to do it to your point Tracy.

Once there’s Square or Stripe, again I’ve got no knowledge that Stripe is doing this. If I were in their shoes I would certainly be thinking about this because of business banking. It’s like what you’re saying, Einar.

Einar: I think Stripe should buy Mercury, that’s what I think, not because I just don’t know the founder. I think that will be a good acquisition.

Rob: Yeah, to merge it in. Anyway, I’m excited about this. Again, not just because business banking sucks today, but I just think there’s so much more innovation to be had including transferring money without a 2:00 PM deadline. There’s so much that I think we’re going to see hopefully in the next 5–10 years as long as (to Tracy’s point) the lobbyists don’t get in the way here in the US.

That is our show for today. Tracy Osborn, you are @traceymakes on Twitter. And if folks want to see what you’re up to aside from that, tinyseed.com/latest. That’s our news feed.

Tracy: Yeah, our applications are opening on August 9th, making sure I had the right date there. Applications are opening. We’re doing two batches a year starting this year. This is for our fall 2021 batch. August 9th, we’ll be open for two weeks.

Rob: And Einar Vollset, @einarvollset on Twitter. You are in the UK. If folks want to reach you, of course, they should reach out to you, tinyseed.com/invest.

Einar: That’s right. We’re all sort of ramping up fundraising for our European fund. I’m going to talk to anyone who’s interested in investing in this space.

Rob: Awesome, thanks again for joining me.

Einar: Thank you.

Tracy: Hey, happy to be here.

Rob: Thank you for joining me again this week. It’s always great to have you back. Next week I have a pretty interesting interview, or maybe I’ll do a solo episode next week. I’m going to be in Cancun at the end of the month so I have to-pre record a couple of them. I hope you join me as those roll out. I’ll be back in your earbuds again next Tuesday morning.