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[00:00:00.240 --> 00:00:03.280] This podcast is hosted by transistor.fm.
[00:00:05.520 --> 00:00:10.720] Maybe my problem is I'm always curious if other people are living a better dream than me.
[00:00:10.720 --> 00:00:12.160] That's probably a therapy.
[00:00:12.160 --> 00:00:14.240] Therapy point you have to figure out.
[00:00:14.240 --> 00:00:14.720] Yeah.
[00:00:15.040 --> 00:00:16.320] That's why you're here today.
[00:00:16.320 --> 00:00:19.360] Dude, if we can be each other's therapists, I'm down for it.
[00:00:33.120 --> 00:00:36.880] Hello and welcome to Build Your SaaS.
[00:00:36.880 --> 00:00:41.920] This is the behind-the-scenes story of building web apps in 2022.
[00:00:41.920 --> 00:00:45.920] I'm Justin Jackson, founder of Transistor.
[00:00:49.440 --> 00:01:05.120] And I just finished chatting with Patrick Campbell, who recently sold his bootstrapped SaaS company, Profit Well, to Paddle, the payment processing billing platform for $200 million.
[00:01:05.120 --> 00:01:06.800] Unbelievable story.
[00:01:06.800 --> 00:01:09.040] I'm not going to say too much before we get into it.
[00:01:09.040 --> 00:01:12.160] It was just an incredible conversation.
[00:01:12.480 --> 00:01:21.920] If you are bootstrapping right now, or you are about to bootstrap, or you have been doing it for years, you will get tons out of this conversation.
[00:01:21.920 --> 00:01:23.840] Let's get into it.
[00:01:27.360 --> 00:01:29.680] You know what I realize with bootstrapping?
[00:01:29.680 --> 00:01:32.320] One of the major downsides is network.
[00:01:32.320 --> 00:01:35.520] Not because you don't have a network, right?
[00:01:35.520 --> 00:01:42.080] Because, but I think you have to actively build it or actively discover the podcast, like all that kind of stuff.
[00:01:42.080 --> 00:01:50.000] When you're venture-backed, you just like, oh, here's like, I'm going to introduce you to three other, you know, portfolio company CEOs or founders or whatever.
[00:01:50.000 --> 00:01:50.720] And it's like, yeah.
[00:01:50.720 --> 00:01:52.880] It's kind of given to you, which is interesting.
[00:01:52.880 --> 00:01:53.280] Yeah.
[00:01:53.080 --> 00:01:54.320] Yeah, yeah, it's true.
[00:01:54.320 --> 00:01:57.520] It's part of the, it's more part of the, the culture.
[00:01:57.520 --> 00:01:58.160] Yeah.
[00:01:58.160 --> 00:02:02.280] I mean, they're both, I think they're both like obviously terribly difficult.
[00:02:02.520 --> 00:02:11.000] And the whole should you or shouldn't you, I don't know if is worthy of debate, like in terms of funding, but like, yeah, it is one of those things that it's a downside that I thought of.
[00:02:11.000 --> 00:02:11.400] Yeah.
[00:02:11.400 --> 00:02:13.000] No, I think we should debate it.
[00:02:13.000 --> 00:02:13.400] All right.
[00:02:13.400 --> 00:02:13.800] Fine.
[00:02:13.800 --> 00:02:14.600] Are we jumping in?
[00:02:14.600 --> 00:02:15.160] Are we in?
[00:02:15.160 --> 00:02:16.200] Are we in this episode?
[00:02:17.400 --> 00:02:19.160] Yeah, let's, let's, let's talk about it.
[00:02:19.160 --> 00:02:22.360] So I've got Patrick Campbell here.
[00:02:22.360 --> 00:02:24.440] Patrick, welcome.
[00:02:24.440 --> 00:02:25.240] What's up, man?
[00:02:25.240 --> 00:02:26.680] You just sold your company.
[00:02:26.680 --> 00:02:27.960] Profit well.
[00:02:27.960 --> 00:02:28.840] I did a thing.
[00:02:28.840 --> 00:02:29.720] To paddle.
[00:02:29.720 --> 00:02:30.520] To paddle.
[00:02:30.520 --> 00:02:37.000] And I have now, I don't know if the video, but I don't know if we're using the video, but I have paddle gear behind me, all kinds of stuff.
[00:02:37.000 --> 00:02:37.800] I'm wearing paddle shoes.
[00:02:37.960 --> 00:02:38.920] That was quick.
[00:02:38.920 --> 00:02:42.280] I got paddle black and yellow sneakers now.
[00:02:42.280 --> 00:02:45.480] Was that that part of the deal that you wanted some sneakers with it too?
[00:02:45.480 --> 00:02:51.160] Yeah, these $80 sneakers were like, that was the deal point that we were going back and forth on.
[00:02:51.480 --> 00:02:53.000] No, I'm an all-in guy, man.
[00:02:53.000 --> 00:02:54.520] Like, once I'm in, I'm all in.
[00:02:54.520 --> 00:02:57.480] So, yeah, it's one of those things that I'm excited about.
[00:02:57.480 --> 00:03:00.440] But yeah, sold the company, joined Paddle.
[00:03:00.440 --> 00:03:02.280] I'm actually in their London office right now.
[00:03:02.440 --> 00:03:03.800] I've been here for about a month.
[00:03:03.800 --> 00:03:04.360] Oh, okay.
[00:03:04.360 --> 00:03:04.920] Yeah, yeah.
[00:03:04.920 --> 00:03:06.920] And so, yeah, this is the new studio.
[00:03:06.920 --> 00:03:10.600] This is why I couldn't figure out focus and stuff like that before we started recording.
[00:03:10.840 --> 00:03:12.840] But yeah, it's been a good time so far.
[00:03:12.840 --> 00:03:14.600] So you're already getting stuff done there.
[00:03:14.600 --> 00:03:17.880] You're like, we got to get the content machine running.
[00:03:18.120 --> 00:03:19.560] If only you knew.
[00:03:19.560 --> 00:03:20.440] Yeah, there's a lot.
[00:03:20.440 --> 00:03:27.640] There's a because there's like integrating, you know, which is like we brought everyone on board.
[00:03:27.640 --> 00:03:33.000] So and thankfully, I mean, we were bootstrapped, so there wasn't a lot of like extra, if that makes sense.
[00:03:33.000 --> 00:03:34.920] So it wasn't like we had a huge finance team.
[00:03:34.920 --> 00:03:37.000] They had a huge finance team, that type of thing.
[00:03:37.480 --> 00:03:42.920] But then there's like a lot of storming and norming in probably good and bad ways.
[00:03:42.920 --> 00:04:24.160] Like good ways in the sense of like, oh, we're good at this like let's bring that over here oh like they're really good at that let's have them take over this and um yeah and so it's been it's been kind of an interesting month like you know that uh that we've been cranking and lots of fun like trust building like i don't think a lot of people with integrations realize like you kind of just assume you have this trust because you have it with your team that you've built over so long and it's like no you're like in an arranged marriage now you kind of have to rebuild it all um which you know which is not so fun so let's go back a bit for people who aren't aware you founded profit well in 2012 yep so started 2012.
[00:04:24.160 --> 00:05:19.880] um it wasn't always yeah it wasn't always in um like sas metrics right you started doing something else first yep so we were then called price intelligently um we still have that brand and product it's part of the profit well suite but um we wanted to help folks um with one of the biggest problems a lot of b2b folks have which is their pricing um we had this little software app a lot of people don't realize it started off as pure software and then basically people asked us to do services on top of the software and we were like no vcs don't like that and then they basically said we'll pay you a lot of money and we were like okay so um yeah that's kind of what started this tech enabled service as it's called and then um a year or so into that we knew we wanted to get to like a more ubiquitous type of software and um we were helping a company as about to ipo with their pricing and they were calculating mrr and churn incorrectly.
[00:05:19.880 --> 00:05:22.680] And so um we wanted more data.
[00:05:22.680 --> 00:05:25.000] That was kind of a good moment of like clarity.
[00:05:25.000 --> 00:05:29.080] And, you know, that's kind of when we started building our subscription financial metrics product.
[00:05:29.080 --> 00:05:39.080] And we've now evolved into a number of different products that help, you basically plug it in and it helps reduce your churn, as well as some other stuff that we've been working around around pricing and stuff like that.
[00:05:39.080 --> 00:05:43.320] And when you started the company, because it wasn't just you who founded it, right?
[00:05:43.640 --> 00:05:45.400] There's quite a few of you, I think.
[00:05:45.800 --> 00:05:47.800] No, it's actually kind of complicated.
[00:05:47.800 --> 00:05:56.360] So it was, it was, I had part-time co-founders, which is not, I would not suggest, although I think you guys kind of did that.
[00:05:56.360 --> 00:06:03.320] So I will, it doesn't, it's not a, it is not a built-in key for success, I think.
[00:06:03.320 --> 00:06:05.160] I think you guys knew each other beforehand.
[00:06:05.160 --> 00:06:06.680] I didn't really know these guys.
[00:06:06.680 --> 00:06:08.280] And everything's great.
[00:06:08.440 --> 00:06:12.760] Yeah, I see three names besides you on the Crunchbase profile.
[00:06:12.760 --> 00:06:13.160] Yeah.
[00:06:13.480 --> 00:06:15.240] It says there was four of you total.
[00:06:15.240 --> 00:06:18.760] No, so here's, here's kind of like the clearer way.
[00:06:18.760 --> 00:06:21.720] So it was myself and these two other guys.
[00:06:22.120 --> 00:06:25.480] They were on our board the entire time, all the way up to the sale.
[00:06:25.480 --> 00:06:31.080] They were advisors, but they never really came into the business and like worked full-time on the business.
[00:06:31.080 --> 00:06:34.200] And there were some misaligned expectations.
[00:06:34.760 --> 00:06:36.280] I don't think anyone's nefarious.
[00:06:36.280 --> 00:06:40.520] I think like, you know, I was a first-time founder, so pretty naive and all that kind of stuff.
[00:06:40.520 --> 00:06:45.240] And they were like, you know, they had never founded anything before, like seriously founded anything before.
[00:06:45.240 --> 00:06:50.120] So I think that like it was one of these things where all kind of mixed together and everything worked out.
[00:06:50.120 --> 00:06:51.480] We're brothers, all that kind of stuff.
[00:06:51.480 --> 00:06:55.800] But it was, it was just me in a room for like 18 hours a day for the first like nine months.
[00:06:55.800 --> 00:07:02.840] And then that's when Peter was brought on, who might be listed in the Crunchbase article, or wherever you're looking.
[00:07:02.840 --> 00:07:05.480] And then Facundo was brought on a little while after that.
[00:07:05.480 --> 00:07:14.200] And so I think that like it's complicated, but like, if I'm referring to my co-founders, I typically am referring to Peter and Facundo, even though they weren't there like day one.
[00:07:14.200 --> 00:07:18.880] And then the other guys are more advisors and board members, if that makes sense.
[00:07:14.600 --> 00:07:19.360] Got it.
[00:07:19.600 --> 00:07:25.520] And what were you doing before Price Intelligently before 2012?
[00:07:25.520 --> 00:07:26.240] Yeah, totally.
[00:07:26.240 --> 00:07:28.160] So I started right out of school.
[00:07:28.160 --> 00:07:29.360] I worked at NSA.
[00:07:29.360 --> 00:07:35.440] I worked in the Intel community, which is fun to say, but it's not as sexy as it sounds.
[00:07:35.680 --> 00:07:36.880] I was an Intel analyst.
[00:07:37.040 --> 00:07:40.320] Were you a Boston grad, like a Boston university grad?
[00:07:40.320 --> 00:07:41.200] No, I went to school.
[00:07:42.080 --> 00:07:43.520] You were in Boston, weren't you?
[00:07:43.520 --> 00:07:44.160] No, not then.
[00:07:44.160 --> 00:07:48.480] So I went to school in Illinois and then was in DC or in Maryland for that.
[00:07:48.640 --> 00:07:49.440] What did you take?
[00:07:49.440 --> 00:07:51.040] What did you take in university?
[00:07:51.280 --> 00:07:53.840] I studied econometrics and math.
[00:07:53.840 --> 00:07:57.360] So a lot of friends, a lot of friends as a child I had.
[00:07:57.360 --> 00:07:58.240] No, yeah.
[00:07:58.320 --> 00:07:59.680] That's my joke at that.
[00:08:00.320 --> 00:08:02.080] What is econometrics?
[00:08:03.680 --> 00:08:15.520] I think a better way to describe what I did was more like applied math, like using math for some sort of outcome, if that makes sense, using economics for some sort of outcome.
[00:08:15.520 --> 00:08:23.120] Honestly, like probably 90% of what I learned and studied was just not applicable, but it kind of taught you how to think, if that makes sense.
[00:08:23.680 --> 00:08:24.080] Okay.
[00:08:24.400 --> 00:08:38.720] It's kind of the way I describe econometrics to some people is like, you know how like in elementary school, I don't know if they do this in Canada, but in the States, like at least they used to when I was growing up, they would teach you that like Columbus discovered America in 1492, right?
[00:08:39.040 --> 00:08:44.400] And then when you get to high school, they're like, actually, it was a bit more complicated.
[00:08:44.400 --> 00:08:47.520] There was like, you know, maybe these folks came down from the Nordics.
[00:08:47.520 --> 00:08:53.920] And then when you get to college, you like learn Columbus was kind of not great, you know, or very debatable.
[00:08:54.320 --> 00:08:55.360] And all these other things.
[00:08:55.360 --> 00:08:57.840] And also the Native American tribes coming off the Bering Strait.
[00:08:57.840 --> 00:08:59.600] And you learn like how complex it is.
[00:08:59.640 --> 00:09:08.040] Econometrics is basically like that, but for economics, meaning if you take a basic economics class, you learn supply and demand are these two straight lines.
[00:09:08.040 --> 00:09:11.560] As you get into econometrics, you start to learn none of them are ever straight.
[00:09:11.560 --> 00:09:12.680] They're all over the place.
[00:09:12.680 --> 00:09:14.840] They backward bend, they do all crazy stuff.
[00:09:14.840 --> 00:09:16.360] So it's kind of like getting deeper.
[00:09:16.920 --> 00:09:20.360] A little tangent that four people.
[00:09:21.320 --> 00:09:22.520] Yeah, exactly.
[00:09:22.840 --> 00:09:26.360] And then, like, if you love that, you go get a PhD.
[00:09:27.000 --> 00:09:29.720] If you hated that, you don't.
[00:09:29.720 --> 00:09:34.760] And so I was going to go get a PhD, but then I was like, I don't know, I'm not that into it.
[00:09:35.320 --> 00:09:38.520] That's what led to working for the Intel community.
[00:09:38.520 --> 00:09:48.920] And then what brought me to Boston was I wasn't really enamored with like the bureaucracy of like the government, basically, even though it was one of the most fulfilling jobs.
[00:09:48.920 --> 00:09:54.760] And so Google, I thought, oh, a 30,000-person tech company, that'll be, that won't be bureaucratic at all.
[00:09:54.760 --> 00:09:57.000] And so, yeah.
[00:09:57.000 --> 00:09:59.480] And then after that, I jumped in the startup community, basically.
[00:09:59.480 --> 00:10:04.040] I worked at a venture-backed startup right before Profitwell.
[00:10:04.040 --> 00:10:04.520] Okay.
[00:10:04.760 --> 00:10:12.760] And so you start Profit Well, eventually, and officially, you've got Peter and Fukundo as your co-founders.
[00:10:12.760 --> 00:10:13.320] Yeah.
[00:10:14.200 --> 00:10:17.000] What does bootstrapped mean in this context?
[00:10:17.000 --> 00:10:19.320] Did you each put in a bunch of money?
[00:10:19.320 --> 00:10:21.880] Did you, were you very lean?
[00:10:22.680 --> 00:10:25.960] Like, what did that actually look like at the beginning?
[00:10:25.960 --> 00:10:29.080] Those guys, you know, thankfully have always been paid.
[00:10:29.320 --> 00:10:37.080] They didn't necessarily, so they didn't put in anything except probably not getting what they truly could get on the open market, if that makes sense.
[00:10:38.360 --> 00:10:48.400] For me, it was I cashed in, I had a small 401k, I think it was like 14 grand, like, cause I was pretty, I was in my mid-20s or early 20s still.
[00:10:49.200 --> 00:10:55.920] Cashed it out, giant tax, like there's a 40% tax on that, those dollars, something crazy, I can't even remember.
[00:10:55.920 --> 00:11:11.440] And then basically lived on that for like six months and told myself if I couldn't like get revenue or some sort of revenue within like six to nine months or like very clearly see a path towards it, I could always find a job.
[00:11:11.440 --> 00:11:16.320] And that was like a really big realization for me, especially coming from a very, like, I come from a very blue collar family.
[00:11:16.320 --> 00:11:21.920] Like the fact that I had left the government, let alone left Google, my parents thought I was insane.
[00:11:21.920 --> 00:11:25.120] And then like when I jumped out, they were like, what is going on?
[00:11:25.120 --> 00:11:29.840] And I internalized that and I was actually like, worst case scenario, I can go be a construction worker.
[00:11:29.840 --> 00:11:32.160] I could go work at a Starbucks, something like that.
[00:11:32.160 --> 00:11:33.360] Yeah, but that was kind of our first time.
[00:11:33.520 --> 00:11:37.840] Even though you could have probably gone back to the government or Google or somebody else.
[00:11:37.840 --> 00:11:38.480] Yeah, yeah.
[00:11:38.480 --> 00:11:41.840] But I had to put my mindset in like, I can always find a job.
[00:11:41.840 --> 00:11:46.320] It might not be a job I want, but I could feed myself, which, you know, was a big thing.
[00:11:46.560 --> 00:11:47.200] Yeah, yeah.
[00:11:47.200 --> 00:11:47.840] That's funny.
[00:11:47.840 --> 00:11:58.560] That's like the, I've had a version of this, which was a lot of founders will say, I could never, now I'm unemployable.
[00:11:58.560 --> 00:12:00.720] I could never go back to having a job.
[00:12:00.720 --> 00:12:01.360] Yeah.
[00:12:01.360 --> 00:12:04.240] And for a long time, I was like, what are you talking about?
[00:12:04.240 --> 00:12:08.480] Like, if I needed to feed my family, I would go work at a Starbucks.
[00:12:08.480 --> 00:12:09.520] I would do a double shift.
[00:12:09.520 --> 00:12:14.720] Like, of course, if you had to, you would go back to employment.
[00:12:14.720 --> 00:12:28.400] But there's a psychological trick there, which is, you know, if you can imagine yourself going back to Starbucks and going, well, that's the worst case scenario is me working at a Starbucks or whatever.
[00:12:28.800 --> 00:12:29.960] Wouldn't be awesome.
[00:12:29.960 --> 00:12:30.520] Yeah.
[00:12:29.600 --> 00:12:36.920] But, you know, there's, it's still like, there still be ways for you to make money.
[00:12:37.080 --> 00:12:44.600] And the truth is, is that, you know, most founders are actually more employable than they think they are, really.
[00:12:44.600 --> 00:12:45.240] Yeah.
[00:12:45.240 --> 00:12:47.320] It's a happiness thing, I think, too.
[00:12:47.560 --> 00:12:52.360] I think that's what people mean is that it's a happiness thing.
[00:12:52.680 --> 00:12:56.040] Although I think they also think they could just never have a boss.
[00:12:56.040 --> 00:12:56.520] Yeah, yeah, yeah.
[00:12:56.760 --> 00:12:58.360] And I'm like, well, I don't know.
[00:12:59.240 --> 00:13:01.240] I think you could.
[00:13:01.560 --> 00:13:03.240] The right boss, you definitely could.
[00:13:03.240 --> 00:13:06.600] Yeah, it's kind of the thing I worry about because I have a boss now, right?
[00:13:06.840 --> 00:13:21.080] What was really interesting about it is that I think if you're running your company properly and you're not like a, like you're trying to like grow, like you're trying to be a big company and you're running it properly, that's the caveat.
[00:13:21.080 --> 00:13:24.280] Because not everyone's trying to like grow really quickly or anything like that.
[00:13:24.280 --> 00:13:32.920] I think that you have to run your team as if the team is the boss, meaning like your exec team or your co-founders, your partners, whatever it is.
[00:13:32.920 --> 00:13:34.920] It's like that team of rivals concept.
[00:13:34.920 --> 00:13:40.040] Like Bob Iger, the Disney CEO for a long time, I think he talks a lot about this.
[00:13:40.040 --> 00:13:47.640] Like everyone at the company or everyone at the exec team, like what makes it great is theoretically each one of them could be CEO or could be a CEO, right?
[00:13:47.640 --> 00:13:51.000] And that's kind of how I really felt about Peter and Facundo.
[00:13:51.000 --> 00:13:53.960] And then when coming to Paddle, that was like a really big thing.
[00:13:53.960 --> 00:13:57.240] There's a lot of founders on the exec team, like a lot of founders.
[00:13:57.640 --> 00:14:02.120] And so part of that's great, but part of that's probably not great, depending on how you look at it.
[00:14:02.120 --> 00:14:13.960] But that's how the whole boss thing kind of like allowed me to kind of like be comfortable with that because it's very exec team, which is better than like a very top-down structure, if that makes sense.
[00:14:13.960 --> 00:14:14.760] Yeah, yeah.
[00:14:15.360 --> 00:14:32.960] This actually brings up a question I've always had about you and your company, which is, I think, somewhere I heard you talking about this decision you made whether you wanted to be a lifestyle company or a big ass company.
[00:14:32.960 --> 00:14:33.600] Yeah.
[00:14:33.600 --> 00:14:39.920] And you talked with the team and you wanted alignment around this idea that we want to go big.
[00:14:39.920 --> 00:14:40.400] Yeah.
[00:14:40.960 --> 00:14:42.640] Why did you want to go big?
[00:14:42.640 --> 00:14:46.560] What was it about going big that was motivating for you personally?
[00:14:46.560 --> 00:14:48.640] And what did, and what did going big mean?
[00:14:48.640 --> 00:14:51.360] Does going big mean capturing all the market?
[00:14:51.360 --> 00:14:54.560] Does going big mean having a big exit?
[00:14:54.560 --> 00:14:58.960] What was the discussion around that with you and the team?
[00:14:58.960 --> 00:15:05.040] The reason we had that discussion is because it's so crucial in how you make decisions.
[00:15:05.040 --> 00:15:08.080] And I think that we like to think that it's not.
[00:15:08.320 --> 00:15:10.320] Like we, the royal we, if you will.
[00:15:10.480 --> 00:15:16.160] We like to think that like, oh, like where you want to go as a company, it doesn't matter as much.
[00:15:16.160 --> 00:15:17.440] Just make decisions along the way.
[00:15:17.440 --> 00:15:27.600] But like the way you make decisions around sales, the way you make decisions around team structure, who you hire, all of these other things, like is very much predicated on like the type of company you want.
[00:15:27.600 --> 00:15:36.000] Like if you want, and I don't know what the other word for lifestyle, like lifestyle businesses, I don't think it should be a pejorative, but some people use it as a pejorative.
[00:15:36.320 --> 00:15:48.240] I think it's like, if you want a great business that like, you know, gets to an amazing lifestyle and that's kind of what you want, it's you're going to hire more contractors.
[00:15:48.240 --> 00:15:50.240] You're going to hire, you're going to hire less people, right?
[00:15:50.240 --> 00:15:53.520] If you want to create like a large company, like you're going to hire people, like you have to, right?
[00:15:53.520 --> 00:15:54.880] And you need leaders, right?
[00:15:54.880 --> 00:15:56.080] And those are expensive, right?
[00:15:56.560 --> 00:15:57.840] And that takes money out of the business.
[00:15:57.840 --> 00:16:08.680] And, you know, for us, it was, it was also around like, you know, I think the average amount I made over the past 10 years, like the average was $71,000 a year.
[00:16:09.640 --> 00:16:15.800] In more recent years, I was making my salary before the acquisition was $150,000 annually.
[00:16:15.800 --> 00:16:20.280] Which is quite low for, like, I was surprised when I saw that.
[00:16:20.440 --> 00:16:28.120] I saw you tweeting about your salary and I was like, wow, like, because you've built this big company, this big brand that is quite recognized.
[00:16:28.120 --> 00:16:38.360] And in some ways, that salary kind of structure was more similar to my friends who have been at funded startups, like the funded startups.
[00:16:38.360 --> 00:16:41.000] And the investors are like, hey, you got to grow.
[00:16:41.000 --> 00:16:42.520] Like, keep investing this back in.
[00:16:42.520 --> 00:16:45.000] Don't take too big of a salary, you know?
[00:16:45.320 --> 00:16:54.840] And a lot of successful bootstrap people I know who are, let's say, over the million dollar ARR mark, they pay themselves quite well.
[00:16:55.320 --> 00:17:00.440] Like 200s, 300s, 400s, even up to a million.
[00:17:00.440 --> 00:17:02.600] So I was surprised by that.
[00:17:02.600 --> 00:17:03.560] But that's the thing, right?
[00:17:03.560 --> 00:17:03.880] Yeah.
[00:17:03.880 --> 00:17:09.800] Because if we wanted to be a lifestyle business, and again, not pejorative, like that's what we were going to do.
[00:17:09.800 --> 00:17:12.920] We were going to be like, great, let's set, you know, let's do profit first.
[00:17:12.920 --> 00:17:14.760] Let's do distributions.
[00:17:14.760 --> 00:17:15.880] Let's do these types of things.
[00:17:15.880 --> 00:17:19.880] Like, but if we're trying to create a big ass company, it's like, that's not what we're going to do.
[00:17:19.880 --> 00:17:27.080] We're going to like, instead of like paying myself, you know, that extra 50 grand or something like that, we're going to hire a BDR.
[00:17:27.080 --> 00:17:27.720] You know what I mean?
[00:17:27.720 --> 00:17:28.520] Like that type of thing.
[00:17:28.520 --> 00:17:30.440] And there's a point where it's detrimental.
[00:17:30.440 --> 00:17:39.480] Like, I think that we probably should have increased the salary sooner because I do think it actually caused detrimental decisions.
[00:17:39.720 --> 00:17:46.400] But I think it's one of those things where that's, that's the reason we had to have that conversation because it affects so many decisions.
[00:17:46.720 --> 00:17:59.040] And I think on the, again, like where we stayed when we went to conferences, like the team, one of the biggest jokes was like going out of this transaction was Patrick is never going to book our travel again.
[00:17:59.040 --> 00:18:00.080] Thank God.
[00:18:00.080 --> 00:18:07.120] Because I would book travel and like, you know, I wouldn't book the Super 8, but I wasn't booking like the four seasons or anything by any means.
[00:18:07.120 --> 00:18:08.560] And it's not like Paddle's doing that either.
[00:18:08.560 --> 00:18:15.280] But it was like, I would book, like, if there was a Spirit Airlines and it was not a long flight, you were going on Spirit Airlines, right?
[00:18:15.280 --> 00:18:18.640] I was, but also me, like, I was going on Spirit Airlines too, right?
[00:18:18.640 --> 00:18:20.160] And so I think that was the big thing.
[00:18:20.160 --> 00:18:21.920] Now, now, why a big ass company?
[00:18:21.920 --> 00:18:23.760] Like, you're asking, you know, it's funny.
[00:18:23.760 --> 00:18:34.240] Like, I, Josh, Barometrics Josh tweeted, you know, the other day about how, like, Josh and I are very similar in so many different ways.
[00:18:34.240 --> 00:18:37.120] When he tweeted about his Glowforge, I was like, I have a Glowforge.
[00:18:37.120 --> 00:18:38.240] Like, there's a lot of these little things.
[00:18:38.240 --> 00:18:39.200] Like, he likes the West Wing.
[00:18:39.200 --> 00:18:39.840] I like the Westwing.
[00:18:39.920 --> 00:18:41.120] Like, there's a lot of these things.
[00:18:41.120 --> 00:18:44.800] We're also just like, you know, white guys of the same age, basically.
[00:18:44.800 --> 00:18:46.960] So I think that drives a lot of it as well.
[00:18:47.120 --> 00:18:54.080] But one of the things that he tweeted that I'm just like so the opposite of, not in a judgmental way, it's just like he has a lot of side projects.
[00:18:54.080 --> 00:18:55.200] He has a lot of like things.
[00:18:55.200 --> 00:18:56.640] He likes to start things.
[00:18:56.640 --> 00:19:02.960] I think he learned that, you know, he needs to treat his main thing like a main thing, you know, based on his tweets.
[00:19:02.960 --> 00:19:06.880] But for me, I can't, I can't, I can't do that.
[00:19:06.880 --> 00:19:08.160] Like I'm all in.
[00:19:08.160 --> 00:19:09.200] Like I'm all in.
[00:19:09.200 --> 00:19:18.160] And I think it, I don't think it's healthy always, but I'm like all in to the point where like I can't have like a side hustle.
[00:19:18.160 --> 00:19:19.840] I can't have some of these things.
[00:19:19.840 --> 00:19:22.160] I need to like go, go, go, go, go at one thing.
[00:19:22.160 --> 00:19:27.200] And maybe I learned to kind of like relax a little bit, but I'm very much like a singular focus.
[00:19:27.200 --> 00:19:36.760] And so, yeah, I didn't necessarily want a lifestyle business because I think a lifestyle business, it's not that there's people listening to this where it's like, it is all in and it's a lifestyle business still.
[00:19:29.920 --> 00:19:37.240] And that's fine.
[00:19:37.400 --> 00:19:38.440] I'm not saying that.
[00:19:38.440 --> 00:19:47.000] What I'm saying is, is like, if we got to a certain point, eight figures in revenue and I'm treating it like a lifestyle business, like it's, I think that'd be really hard for me.
[00:19:47.320 --> 00:19:50.200] And thankfully, the guys are similar thinking.
[00:19:50.200 --> 00:19:52.280] And so it was more of an all-in.
[00:19:52.280 --> 00:19:57.080] And I also like believe, and this is not a judgmental statement, this is a very personal statement.
[00:19:57.080 --> 00:20:06.360] Someone described it as like, like, there's almost this like David Goggins nature of SAS, like how I approach things in the sense of the struggle.
[00:20:06.360 --> 00:20:10.440] Like, I'm very much like, if it's not a hard thing, then why are we doing it?
[00:20:10.440 --> 00:20:10.680] Right.
[00:20:10.680 --> 00:20:13.400] Like, if it's not hard, that's the purpose.
[00:20:13.400 --> 00:20:16.600] Like, that's why we're on this earth is to like do hard things and grow, right?
[00:20:16.600 --> 00:20:22.120] Which is, you know, the David Goggins thing is almost like, I think he's a masochist with some of these things.
[00:20:22.120 --> 00:20:31.160] I'm not quite on that level, but it's more of like, I think that there's this, this, this view I have of like trying to do something hard because it's worthy of doing it.
[00:20:31.560 --> 00:20:33.560] That's kind of where my values sit, if that makes sense.
[00:20:33.560 --> 00:20:36.200] So it's a very personal decision, I guess, the way I'm trying to say it.
[00:20:36.200 --> 00:20:36.600] Yeah.
[00:20:36.600 --> 00:20:39.960] And I mean, some folks, it's just unavoidable.
[00:20:39.960 --> 00:20:46.440] The fact that Barometrics sold for 4 million and you've sold for 200 million.
[00:20:46.440 --> 00:20:49.320] Now, that must be a mixture of stock and cash, right?
[00:20:49.320 --> 00:20:50.680] That's not all cash, is it?
[00:20:50.920 --> 00:20:51.560] It's a mix.
[00:20:51.560 --> 00:20:52.120] Yeah, yeah.
[00:20:52.360 --> 00:20:53.720] I don't think Paddles even raised.
[00:20:53.880 --> 00:20:56.920] Paddles raised maybe just under 300 million or something.
[00:20:56.920 --> 00:20:57.240] Yep.
[00:20:57.320 --> 00:21:02.680] So yeah, there's no way they would have given, paid out 200 million in cash.
[00:21:04.120 --> 00:21:05.840] That's most of their stores.
[00:21:05.840 --> 00:21:07.480] They're in their bank account.
[00:21:07.480 --> 00:21:08.040] Yeah.
[00:21:08.360 --> 00:21:12.120] Okay, so you've got a mix of stock and cash.
[00:21:12.440 --> 00:21:19.600] But still, the exit is people have been saying, like, wow, this is a 50 times exit.
[00:21:20.480 --> 00:21:26.320] And some people have, you know, Josh himself is like, well, here's why I think that happened.
[00:21:26.320 --> 00:21:30.720] And he said, well, maybe it's because I treated barometrics too much like a side project.
[00:21:31.120 --> 00:21:32.480] And there were some other things too.
[00:21:32.800 --> 00:21:34.320] He got locked into Stripe.
[00:21:34.320 --> 00:21:35.040] Yep.
[00:21:35.040 --> 00:21:37.280] And he was not freemium.
[00:21:37.280 --> 00:21:38.320] You were freemium.
[00:21:38.320 --> 00:22:47.320] Do you think that part of your, and in some ways I'm asking this selfishly too, because another comment has been around the acquisition of Profit Well has been it's better to try to go out and own the market right to try to become the dominant player and you know you guys were clear that you wanted to be a big ass company was that part of being a big ass company was that you really wanted to own as much of the market as you could was that strategic and is the strategy there like once you own the market then you just have so much more leverage or like what was some of your thinking around that or was it simply the challenge like let's just see how much of this this nascent category can we develop and then you know become dominant in yeah i think there's a couple things i think that so for one i do think josh is right in his analysis on a couple of things like you have it's you have someone treating it like a side project and then you have me, who's insane?
[00:22:47.280 --> 00:22:54.120] Like, you know, like in terms of like focus, like assuming the same intelligence, like one will win, right?
[00:22:54.120 --> 00:22:55.880] And without luck and stuff like that, right?
[00:22:55.880 --> 00:22:57.800] So I think that that's, that's really tough.
[00:22:57.800 --> 00:22:59.240] And I think that that's helped him.
[00:22:59.240 --> 00:23:01.320] And I'm, I'm an investor in his next thing, maybe.
[00:23:01.320 --> 00:23:04.360] And so I think that, like, I think that's a really good lesson for him.
[00:23:04.360 --> 00:23:11.800] And I think it's, it's a hard one because think of the introspection that he has to have to like look at that, which is so hard, right?
[00:23:12.120 --> 00:23:21.640] And I think that the other thing is like the lockup with Stripe, I think it points to an interesting situation because some of these markets are not big enough.
[00:23:21.640 --> 00:23:23.000] Like they seem big.
[00:23:23.000 --> 00:23:24.680] Oh, subscription companies everywhere.
[00:23:24.680 --> 00:23:29.080] It's like there are 150,000 max subscription companies in the world.
[00:23:29.080 --> 00:23:30.440] That includes subscription media.
[00:23:30.440 --> 00:23:35.880] It includes subscription memberships, subscription SaaS, subscription consumer, enterprise subscription.
[00:23:35.880 --> 00:23:37.240] There's 150,000 max.
[00:23:37.240 --> 00:23:44.360] Like we're not talking about e-commerce startups where there's like millions of stores and millions are coming on board like every couple of years.
[00:23:44.360 --> 00:23:44.840] Right.
[00:23:45.160 --> 00:24:01.240] And so what we did is we looked at that, we looked at all the competition and we basically said, okay, like analytics products inherently kind of suck to build because no one appreciates the work that went into them and they're not willing to pay anything for them.
[00:24:01.240 --> 00:24:04.760] Like we did our pricing research on metrics because we were going to charge for it.
[00:24:04.760 --> 00:24:07.240] Like it was originally going to be a paid product.
[00:24:07.240 --> 00:24:14.600] And in all this context, we said we have to go up market, which that means hiring a lot of people and being a funded company.
[00:24:15.400 --> 00:24:20.520] Or we have to do free, which probably should have meant we raise money.
[00:24:20.520 --> 00:24:24.440] Like we probably should, because we thought, oh, how hard could accuracy be?
[00:24:24.440 --> 00:24:27.000] You know, which was famous last words, right?
[00:24:27.000 --> 00:24:31.160] So I think like that's what guided the decision to go free.
[00:24:31.480 --> 00:24:36.360] And then the thesis became, we really like this concept of do-it-for-you.
[00:24:36.360 --> 00:24:39.000] So, retain, the beauty of retain is that we do it for you.
[00:24:39.000 --> 00:24:40.760] You plug it in and it's done.
[00:24:40.760 --> 00:24:41.960] You don't have to write emails.
[00:24:41.960 --> 00:24:54.400] You don't have to, and it's not because, like, we don't want it, it is kind of because we don't want your input, like, it's because we're studying everything, and because we have all this data, we can understand exactly what's good or bad, and then we do it for you.
[00:24:54.400 --> 00:24:59.760] And you just don't want to become an expert in credit cards, you want to just understand, like, great, it's fixed, right?
[00:24:59.760 --> 00:25:05.280] I made more money this month than I should have because, or than I was going to, because profit will fix it with retain.
[00:25:05.280 --> 00:25:11.840] And that's where the data move, like it wasn't a network effect of users and customers, that's what a lot of people think.
[00:25:11.840 --> 00:25:13.120] Like, oh, they get upgrade pass.
[00:25:13.120 --> 00:25:23.760] Like, we certainly get that, and the brand really helped, but it was a network effect with the data when we were able to study that data and input that into products so we could build products that do it for you, like lowered your churn automatically.
[00:25:23.760 --> 00:25:34.640] And so, I think the mindset, it was just a mindset and a focus where it's hard to sell a product that's underappreciated just in general, like metrics in general.
[00:25:34.640 --> 00:25:47.760] It's hard to sell that in a market where there is a viable, free alternative, where even if you like, you didn't really like the design as much because people love Josh's design, or maybe Turt Mogul had a couple extra features than we did.
[00:25:47.760 --> 00:25:57.200] Like, it's really hard to compete with it unless you know your product like is 10x better and there wasn't going to be a 10x better product in the market because we were going to keep moving.
[00:25:57.200 --> 00:26:00.800] And I just don't think there can be a 10x better product in analytics in general.
[00:26:00.800 --> 00:26:21.520] Yeah, and then there was also the risk, uh, which ended up coming true, which is you know, Stripe added analytics, uh, even PayPal added analytics, and recurly and other, it wasn't like this category was completely new, like recurly and other products had um some of these analytics before.
[00:26:22.080 --> 00:26:38.280] Your comment about the market being small is so interesting because this gets back to something, I mean, people are tired of me talking about this, but the characteristics of a market, the size, the shape, and the dynamics.
[00:26:38.280 --> 00:26:40.280] And so maybe we could get into this a little bit.
[00:26:40.280 --> 00:26:42.440] So you said $150,000.
[00:26:44.280 --> 00:26:52.280] And so, you know, let's say, you know, $99 a month, if that's where you start, I think that's where Chart Mogul starts.
[00:26:52.280 --> 00:26:59.320] And then, you know, if you captured 20,000 of that 150,000, which was that's a fair chunk.
[00:26:59.320 --> 00:26:59.880] Yeah.
[00:27:00.600 --> 00:27:03.160] You know, that's $2 million a month or whatever.
[00:27:03.480 --> 00:27:08.040] Not a bad business, but, and we don't know what Chart Mogul's metrics are.
[00:27:08.040 --> 00:27:09.240] Do you have any idea of size?
[00:27:09.240 --> 00:27:17.720] And like, if you guys were out to own the market, was Profit Well number one by a large margin, or did Chart Mogul have a significant portion as well?
[00:27:17.720 --> 00:27:24.760] We have 30,000 subscription companies on Profit Well to now more than 30,000.
[00:27:24.760 --> 00:27:28.680] And then ChartMogle has one to 2,000.
[00:27:28.680 --> 00:27:31.640] Farmetrics had about 1,000, might be a little bit more.
[00:27:31.640 --> 00:27:42.840] But yeah, so I think the other thing to point out here that you kind of brought up is the physics of a market guides so many things.
[00:27:42.840 --> 00:27:44.120] Like, yes.
[00:27:44.120 --> 00:27:54.920] And a lot of people don't realize, like, even if, let's say, we just wanted to be a lifestyle business, we wanted a great business that guided, you know, all of our lives, made us all very wealthy.
[00:27:54.920 --> 00:27:58.040] Everyone was like, you know, had really great profit from the entire company.
[00:27:58.040 --> 00:28:00.040] We were a great company to work for, et cetera.
[00:28:00.600 --> 00:28:05.000] 20,000 customers paying $100 a month.
[00:28:05.000 --> 00:28:06.840] Oh my God, what a grind.
[00:28:06.840 --> 00:28:07.240] Right.
[00:28:07.560 --> 00:28:12.040] And I can tell you right now, for most of the market, $100 a month is too expensive.
[00:28:12.040 --> 00:28:13.680] Like, it's insane.
[00:28:13.680 --> 00:28:14.160] Right.
[00:28:14.120 --> 00:28:22.640] And so, what we basically, like, honestly, the worst thing, like, the thing we got wrong was the market.
[00:28:22.960 --> 00:28:24.480] Like, that's the thing we got right.
[00:28:24.480 --> 00:28:25.200] Like, it worked out.
[00:28:25.200 --> 00:28:33.120] So I'm not complaining, but like we knew, like, as we started getting into like, we're trying to be a big company, like, we knew our TAM was not big enough.
[00:28:33.120 --> 00:28:46.960] Like, our TAM, the way we monetize, and even though we were monetizing our leads better than anyone else in the space, because with retain, someone who wasn't willing to pay $50 a month for metrics is willing to pay $300 a month because it's purely pay for performance, right?
[00:28:46.960 --> 00:28:51.600] So they're like, I wouldn't have had this money, and you're not, you're only taking, you know, a portion of the money I would have gained.
[00:28:51.600 --> 00:28:54.080] And I get to keep all the, all the money later, right?
[00:28:54.080 --> 00:29:04.080] So it's one of those things, like, even though we were squeezing more out of this, this lemon than anyone else, it was one of those things that, like, that's where this multi-product concept came to be.
[00:29:04.080 --> 00:29:14.880] And also, why, like, it was kind of appealing to sell too, because the billing systems just have an ability to monetize even better than anyone else because they can monetize the throughput, right?
[00:29:15.200 --> 00:29:20.640] And so, yeah, there's a lot we can do with that with like retain as well as some of the other products we're building.
[00:29:20.640 --> 00:29:36.560] But the advice to anyone else listening is like, don't underestimate the velocity of your market because even if you're building something that like is in a super competitive space, especially if you're building something in a competitive space, if the market's big enough, that's fine.
[00:29:36.560 --> 00:29:40.000] Like, you can make a great, like, again, lifestyle business.
[00:29:40.000 --> 00:29:48.680] But if you're in a market that is squeezed and it has competition, like go into another market.
[00:29:48.400 --> 00:29:49.640] Yeah.
[00:29:48.640 --> 00:29:51.680] Um, yeah, unless you're really just glutton for punishment.
[00:29:51.680 --> 00:29:52.800] Can we get into this a bit more?
[00:29:52.800 --> 00:29:59.280] Because I, it feels like this is the area that that gets misunderstood a lot.
[00:29:59.280 --> 00:30:06.520] And so you said TAM, which is total addressable market.
[00:30:06.520 --> 00:30:07.480] That's right.
[00:30:07.480 --> 00:30:13.880] And so that's the idea there is how many companies are in this market total, right?
[00:30:13.880 --> 00:30:15.480] Essentially, yeah, yeah, yeah.
[00:30:15.480 --> 00:30:17.160] It's you can define it a little bit differently.
[00:30:17.400 --> 00:30:18.760] How many participants or?
[00:30:18.760 --> 00:30:26.040] Well, so there's a little bit like it's like all metrics, like you can kind of fudge with the definition depending on what you're trying to do, right?
[00:30:26.360 --> 00:30:29.800] So there's 150,000 subscription companies.
[00:30:29.800 --> 00:30:38.360] Maybe that's our total addressable market, but like our realistic addressable market, there's other acronyms people use.
[00:30:38.360 --> 00:30:51.800] It's like, I can tell you out of those 150,000, 75,000 are just not addressable for us because they're enterprise companies, they're too big, they're, you know, they don't fit our billing systems we support.
[00:30:52.680 --> 00:30:53.480] Yeah, totally.
[00:30:53.480 --> 00:30:55.320] Like all over the place, right?
[00:30:55.320 --> 00:31:11.080] And so it's, it's more about like, I think in an investor pitch or just in an adventure-backed company or trying to be a big company, you want a very large TAM because that means that the future, like if I just capture X percent of the TAM, right?
[00:31:11.800 --> 00:31:20.600] I think in a bootstrap company or a lifestyle business, you don't necessarily have to worry about, oh my God, I have to pitch something that has a huge addressable market.
[00:31:20.600 --> 00:31:35.240] But if you have a very large addressable market, it's probably an indication of like the ease of your go-to-market strategy because everyone already has one of these things and I'm just going to sell a different one, you know, that type of a thing.
[00:31:35.480 --> 00:31:36.840] I'm trying to invent a market.
[00:31:37.320 --> 00:31:39.960] And you also talk about the velocity.
[00:31:40.280 --> 00:31:46.720] So what do you mean by velocity when you're when you're when you use that as a descriptor or the physics of a market?
[00:31:44.920 --> 00:31:48.000] What are you talking about there?
[00:31:48.320 --> 00:31:52.800] It's the number of logos in the market, like number of potential buyers.
[00:31:52.800 --> 00:31:54.880] And again, it's not like...
[00:31:54.880 --> 00:32:00.400] Like if we're selling into subscription companies, it's not every subscription company or if it's like we're selling a consumer product.
[00:32:00.400 --> 00:32:01.680] It's not every consumer.
[00:32:01.680 --> 00:32:03.840] It's people who fit some sort of a segment.
[00:32:03.840 --> 00:32:06.240] That's our addressable market theoretically.
[00:32:07.120 --> 00:32:15.600] And the bigger that segment is, just the number of humans that theoretically would go to your landing page is just increased.
[00:32:15.600 --> 00:32:19.040] And the number of humans you're able to like market to, right?
[00:32:19.040 --> 00:32:28.240] So the reason our strategy for marketing is what it is, is not because Patrick has a big ego and really likes to do podcasts.
[00:32:28.240 --> 00:32:31.360] The reason it is, is because we need a brand.
[00:32:31.360 --> 00:32:33.040] We need people to know who we are.
[00:32:33.040 --> 00:32:35.760] And you don't get that through paid media.
[00:32:35.760 --> 00:32:37.040] You get that through content.
[00:32:37.040 --> 00:32:38.800] You get that through community.
[00:32:38.800 --> 00:32:39.760] You get that through events.
[00:32:39.760 --> 00:32:41.200] You get that through those types of things.
[00:32:41.200 --> 00:32:51.920] So that when you're talking to someone, Justin, about, hey, I need metrics for my subscription business, you go, well, you know, there's a couple, but I know Profile's free, right?
[00:32:51.920 --> 00:32:56.960] And so, you know, when Patrick is on the podcast and like, you should check it out, but also check out bare metrics and whatever.
[00:32:56.960 --> 00:32:58.160] And then that's all I need.
[00:32:58.160 --> 00:33:02.720] I just need you to refer to it because when they get into the product, they're going to compare and contrast it.
[00:33:02.720 --> 00:33:06.880] And the product is good enough, if not better in certain ways, that they're going to stay.
[00:33:06.880 --> 00:33:07.280] Right.
[00:33:07.280 --> 00:33:16.400] And so that's, that's what I mean: is like, if you are selling to like a fitness product, your TAM is huge because there's so many people are trying to get healthy.
[00:33:16.400 --> 00:33:21.680] And you can drive that through paid and through, you know, display ads and all these other things.
[00:33:21.680 --> 00:33:22.640] You don't really need a brand.
[00:33:22.640 --> 00:33:26.080] You don't really need content unless you're doing an SEO play in that case.
[00:33:26.080 --> 00:33:32.360] And so, that's what I mean by the physics: is like how many people can you get through in a very quick manner into your funnel, basically.
[00:33:29.840 --> 00:33:34.120] And how important do you feel?
[00:33:34.280 --> 00:33:42.520] The because even in your example, the physics there are that some people are already in motion.
[00:33:42.520 --> 00:33:43.000] Yep.
[00:33:43.320 --> 00:33:56.680] And so, I have this feeling like most of the success of a market of a product in a category has to depend on how many people are already in motion.
[00:33:56.680 --> 00:34:05.800] And it feels like many founders feel like you can motivate people who are not in motion to buy the product.
[00:34:05.800 --> 00:34:07.400] So, what's your take on that?
[00:34:07.400 --> 00:34:15.560] Because, in your example, there's two people in Slack, and somebody is looking for SaaS metrics, which means they're already in motion.
[00:34:15.560 --> 00:34:17.320] They already have a company.
[00:34:17.320 --> 00:34:24.280] They already like think of all the things they have to do to just get to the starting line of profit well, right?
[00:34:24.280 --> 00:34:25.720] So, what's your take on that?
[00:34:25.720 --> 00:34:28.200] Another huge mistake from us.
[00:34:28.200 --> 00:34:29.400] Again, huge mistake.
[00:34:29.560 --> 00:34:30.760] I'm not trying to be a jerk.
[00:34:30.760 --> 00:34:36.200] It's just like these are things that I know, like if we had adjusted our thinking, we could have done better.
[00:34:36.200 --> 00:34:49.400] Right now, in like the average subscription or SaaS company, depending on how you want to slice it, the median expenses that go to sales and marketing is 60%.
[00:34:49.400 --> 00:34:50.120] 60%.
[00:34:50.120 --> 00:34:59.000] So, if I take 1,200 companies, I think the study was, I add up every dollar they're spending on everything, toilet paper, ads, everything in between, right?
[00:34:59.640 --> 00:35:03.800] And 60% of those dollars are going to sales and marketing.
[00:35:03.800 --> 00:35:09.320] Now, you throw in operations, you throw in like the desks and everything like that.
[00:35:09.320 --> 00:35:14.920] How much money do you think is left over for retention and pricing, which are two paid products?
[00:35:15.600 --> 00:35:16.640] There's not a lot.
[00:35:16.640 --> 00:35:17.120] Yes.
[00:35:17.120 --> 00:35:24.240] And so we're literally like, we spent 10 years yelling about pricing and yelling about retention.
[00:35:24.240 --> 00:35:36.400] And people get it, like people find it important, but like we're constantly educating and we're fighting this inertia of, yes, there's five, there's 15,000 different sales and marketing pieces of software, right?
[00:35:36.400 --> 00:35:38.960] So there's a huge, hugely different problem there.
[00:35:38.960 --> 00:35:40.080] But that's another thing, right?
[00:35:40.080 --> 00:35:40.320] Yeah.
[00:35:40.320 --> 00:35:48.640] Like we're not selling something, like it's rare that someone like is looking for like dunning or credit card failure software, right?
[00:35:48.640 --> 00:35:52.320] And we try to own those places, obviously, but it's a lot of education.
[00:35:52.320 --> 00:35:57.120] And I think that you're better off finding people in motion with something.
[00:35:57.120 --> 00:36:04.400] So if I was just trying to like create, oh, I'm going to work on something for six months and I want to get it to 100 grand a year and like revenue, right?
[00:36:04.560 --> 00:36:10.400] I would focus on things where people are already in motion, huge TAM, meaning lots of people.
[00:36:10.400 --> 00:36:12.160] We don't always build these things for money.
[00:36:12.160 --> 00:36:15.200] I actually love like the SaaS and subscription community like a lot.
[00:36:15.200 --> 00:36:18.480] Like I've, I've, you know, and so it's one of those things where like, it's not all about the money.
[00:36:18.480 --> 00:36:22.720] It's not all about the TAM, but it's like, if I wanted to make it easy, those are the things that I would look for.
[00:36:22.720 --> 00:36:25.280] And then the third piece is lock-in.
[00:36:25.280 --> 00:36:27.680] I would try to build a product that had lock-in.
[00:36:27.680 --> 00:36:31.760] Like, what's amazing about billing systems, there's so much lock-in.
[00:36:32.080 --> 00:36:39.200] Like people, like, they install it and they're like, there's only a couple points in their history that they want to change it or are thinking of changing it.
[00:36:39.200 --> 00:36:45.120] And that's a whole new problem for Paddle now that I'm discovering at Paddle.
[00:36:45.120 --> 00:36:49.520] But it's also the brilliance of like the Stripe Atlas program.
[00:36:49.520 --> 00:36:50.760] Like the brilliance of the Stripe Atlas.
[00:36:50.880 --> 00:36:55.200] I always thought, oh, that's just them being nice and like, you know, giving back to the community.
[00:36:55.200 --> 00:37:02.520] And part of it is, but another part of that program is once you got that Stripe account, like, why would you like do anything else?
[00:36:59.760 --> 00:37:02.680] Right.
[00:37:02.840 --> 00:37:07.720] And then normally we see people who reach like $700,000 a year to about a million a year.
[00:37:07.720 --> 00:37:11.960] That's the next, like then they're looking at Charge B, Recurly, Paddle, et cetera.
[00:37:11.960 --> 00:37:18.360] But yeah, lock-in, if you can get lock-in, is the third thing I would look for, but it's not as crucial as the first two.
[00:37:18.760 --> 00:37:19.880] Yeah, the physics.
[00:37:19.880 --> 00:37:22.920] I love that idea, that metaphor of the physics.
[00:37:23.560 --> 00:37:26.680] Hey, how come your team doesn't have their own podcast?
[00:37:26.680 --> 00:37:31.560] Head over to Transistor and use my coupon, transistor.fm slash justin.
[00:37:31.560 --> 00:37:35.640] You'll get 15% off your first year of podcast hosting.
[00:37:36.280 --> 00:37:47.080] Because I'm trying to describe so many of the metaphors we use in startups, but especially in bootstrap startups, are incredibly two-dimensional.
[00:37:47.080 --> 00:37:51.080] And so there's this idea of like this binary of charge more.
[00:37:51.080 --> 00:37:56.840] And I've always been saying, no, there's way more nuance in pricing strategy.
[00:37:56.840 --> 00:38:04.840] Like when I actually read academic papers on pricing, there's a ton of math that I do not understand with super tons of variables.
[00:38:04.840 --> 00:38:13.000] And even if you wanted to, if you're a dumbass like me and you wanted to look at the price, like, should I charge more or should I not?
[00:38:13.320 --> 00:38:15.160] There's a lot of places I'd have to look.
[00:38:15.160 --> 00:38:20.040] Like, how is pricing anchored by the existing competition?
[00:38:20.040 --> 00:38:36.120] Because if MailChimp is charging $49 per month for whatever, a thousand subscribers, ConvertKit can't come in and charge $2,000 unless there's something significantly different.
[00:38:36.120 --> 00:38:42.840] And, you know, Nathan's always anchored his pricing, I think, within 10% of MailChimp for that reason.
[00:38:42.840 --> 00:38:46.320] It's like, you can't be too much higher, right?
[00:38:46.320 --> 00:38:59.040] You know, what's funny is like, I think your statement of like the binary nature of a lot of advice is like something that we all need to learn sooner than later in our trajectories, right?
[00:38:59.040 --> 00:39:00.080] Like you and I are baked.
[00:39:00.080 --> 00:39:08.800] Like we're, we're like, you know, thankfully we learned it, but I think like teaching that to some of, you know, if you're early in your trajectory, like learning that is so important.
[00:39:08.960 --> 00:39:19.360] It gets me, it grinds my gears about some of the Twitter bullshit that you see, like the advice and stuff, because it's like, it's the equivalent of like, drink eight water, eight glasses of water a day, stay hydrated, guys.
[00:39:19.360 --> 00:39:21.360] Like, and it's like, yeah, but it's really nuanced.
[00:39:21.360 --> 00:39:22.560] Like, I'm a large human.
[00:39:22.560 --> 00:39:25.040] I need more water, you know, like I, you eat a lot of salt.
[00:39:25.040 --> 00:39:25.920] I don't know if that's true or not.
[00:39:25.920 --> 00:39:26.560] You need more.
[00:39:26.560 --> 00:39:33.280] Like, and I think it's like, yeah, a lot of this advice is like pithy baloney, but all advice is more nuanced.
[00:39:33.280 --> 00:39:34.160] It depends.
[00:39:34.160 --> 00:39:39.360] Like, I think freemium is the future, but should every company use freemium?
[00:39:39.360 --> 00:39:40.400] Of course not, right?
[00:39:40.400 --> 00:39:41.280] Like, of course not.
[00:39:41.280 --> 00:39:52.400] Like, maybe in some way over the next decade, but that's, that's a big thing for everyone to latch on to is like you have to take in the advice and then filter it through a framework for your business.
[00:39:52.640 --> 00:39:54.480] And I think not enough of us do that.
[00:39:54.480 --> 00:40:15.920] And understanding that, again, the idea of the physics of a market, I just love that idea because the podcast market, podcast hosting market, has similar physics to web hosting, but different in some notable ways.
[00:40:15.920 --> 00:40:18.640] But we are most like web hosting.
[00:40:18.640 --> 00:40:29.200] So when Ruben Gamez was giving me advice early on, he said, if I was you, I would look at web hosting because they're two decades ahead of podcast hosting.
[00:40:29.200 --> 00:40:34.200] And likely what worked there, the dynamics that work there, are also going to apply.
[00:40:34.200 --> 00:40:36.840] And so for example, affiliates.
[00:40:36.840 --> 00:40:41.080] Affiliates is big, and it was big.
[00:40:41.400 --> 00:40:56.360] Now, the dynamics of the podcast, and he was also clear to say, and we knew this from the beginning, like the paid podcast hosting market is maybe 100,000, 200,000, something like that.
[00:40:56.360 --> 00:41:05.320] And with a much lower average revenue per user than, you know, we're high at our entry level, and our entry level is 19.
[00:41:05.320 --> 00:41:05.720] Yeah.
[00:41:06.040 --> 00:41:08.520] Libson's entry level is 5.
[00:41:08.840 --> 00:41:17.160] And so we knew that the physics of our market are defined by those boundaries.
[00:41:18.120 --> 00:41:27.080] And no matter how much I wish, like I could wish and wish and wish that this will be a billion-dollar company, there's just no way it's happening.
[00:41:27.960 --> 00:41:32.600] The dynamics in this market are, it's impossible.
[00:41:32.600 --> 00:41:36.600] It's impossible the way it is right now for this to be a billion-dollar company.
[00:41:36.600 --> 00:41:38.840] Now, the physics change all the time.
[00:41:38.840 --> 00:41:44.680] Like we found with Anchor, there's a worry with Anchor.
[00:41:44.680 --> 00:41:55.640] Anchor has ended up being an incredible lead gen for Transistor in the same way that Substacks free email newsletter has been unbelievable for Nathan and ConvertKit.
[00:41:56.280 --> 00:41:58.920] So all of a sudden, the physics change.
[00:41:58.920 --> 00:42:05.520] Now instead of 500,000 podcasts in the world, some of which are free on free hosting or whatever.
[00:42:05.160 --> 00:42:10.840] Now, now there's, in a matter of years, there's two and a half million or four million or something like that.
[00:42:10.840 --> 00:42:12.120] And what does that mean?
[00:42:12.120 --> 00:42:13.720] You know, the physics change.
[00:42:13.720 --> 00:42:32.960] At the same time, you know, even with two and a half million podcasts in the ecosystem, if you asked me to place a bet on whether any of us were going to be a billion-dollar company even in 10 years, I would say, no, I wouldn't make that bet.
[00:42:32.960 --> 00:42:41.040] Now, would I make a bet that Paddle could be a $10 billion company in 10 years?
[00:42:41.040 --> 00:42:45.280] I might make that bet because the dynamics of that market are so much different.
[00:42:46.560 --> 00:42:58.800] In terms of physics, never underestimate the entrant of a competitor on what it, like, competitors entering your market historically make the market better.
[00:42:58.800 --> 00:43:01.680] Like, it's, you're always scared.
[00:43:01.680 --> 00:43:16.320] And one of the things we would always say is, like, again, nothing against our competitors, but like, we haven't thought of them that much in the past couple of years because like, you know, 30,000, you know, then 20,000 or 25,000 versus one to two.
[00:43:16.320 --> 00:43:18.000] And they're monetizing differently.
[00:43:18.000 --> 00:43:20.800] Our monetizable products are growing pretty rapidly.
[00:43:20.800 --> 00:43:25.680] But like, it was one of those things where we were like, we need a really big competitor.
[00:43:25.680 --> 00:43:32.080] We need a big one, like a serious big one, because that trains the market in a way that you can't.
[00:43:32.080 --> 00:43:41.520] Like, I can't train the market fast enough as Stripe's metrics actually being like Stripe's metrics are not, I'll say it, like, I love those Stripe.
[00:43:41.600 --> 00:43:42.080] They're not great.
[00:43:42.080 --> 00:43:42.720] They're not great.
[00:43:42.720 --> 00:43:43.920] Like, they're inaccurate.
[00:43:43.920 --> 00:43:47.600] Like, they make some very obvious accuracy issues, but it is the bare minimum.
[00:43:47.600 --> 00:43:49.360] They needed the bare minimum.
[00:43:49.360 --> 00:43:53.680] And like, it's just one of those things that wasn't like amazing.
[00:43:53.680 --> 00:43:58.080] And so it was one of those things that, like, it would be cool if like HubSpot got into the space, right?
[00:43:58.080 --> 00:44:01.800] Now I say that, and then they get in the space and they have all the money, and we're like, oh my God, right?
[00:44:01.800 --> 00:44:06.040] But like, that's one of the things that when you have competitors enter the market, it changes.
[00:44:06.040 --> 00:44:07.240] The market changes.
[00:44:07.640 --> 00:44:16.120] The throughput is like now higher because all of a sudden that SEO you've built, people are starting to search for it more, or your ads are getting more traffic, or like those types of things.
[00:44:16.120 --> 00:44:29.720] Now, I will say though, that like in the podcast hosting space, like one question that's useful: if you want to build a big company, or even if you're just a bootstrap company, you're thinking like, hey, I want to, you know, I want to just be bigger.
[00:44:29.720 --> 00:44:34.200] What would it take my market to have a billion-dollar exit?
[00:44:34.200 --> 00:44:36.120] Whether it's me or someone else, right?
[00:44:36.120 --> 00:44:37.160] That's a big thing.
[00:44:37.160 --> 00:44:41.960] And that's what guided us a little bit in the free conversations because we knew it wasn't going to come from metrics.
[00:44:41.960 --> 00:44:43.480] And we knew like, well, what would it take?
[00:44:43.480 --> 00:44:46.280] Well, we'd have to solve these six problems and blah, blah, blah.
[00:44:46.440 --> 00:44:49.000] And that started as we're guiding where product basically went.
[00:44:49.000 --> 00:44:50.600] But it's a good thought exercise.
[00:44:50.600 --> 00:44:52.600] How much do you think?
[00:44:52.600 --> 00:45:00.280] I mean, again, the dynamics of every market are different and could change literally one week to the next overnight.
[00:45:00.280 --> 00:45:04.840] And, you know, founders, I think we think in bets.
[00:45:04.840 --> 00:45:11.480] The question for me is like, for example, should Transistor try to go out and own the market?
[00:45:11.480 --> 00:45:18.600] Like right now, we have maybe 1.5% of the paid podcast hosting market.
[00:45:18.600 --> 00:45:19.640] That's my guess.
[00:45:19.640 --> 00:45:20.360] Sure.
[00:45:20.360 --> 00:45:23.400] But, you know, we're doing, we have a four-person company.
[00:45:23.400 --> 00:45:23.960] Yeah.
[00:45:23.960 --> 00:45:25.880] Everybody's paid very well.
[00:45:25.880 --> 00:45:26.040] Yeah.
[00:45:27.560 --> 00:45:31.880] And, you know, there's certainly threats.
[00:45:31.880 --> 00:45:32.360] Sure.
[00:45:32.360 --> 00:45:36.680] This was a debate I was having with Dave Zorob at Chartable.
[00:45:36.680 --> 00:45:39.640] And his answer changed depending on how things were going.
[00:45:39.640 --> 00:45:42.040] Because we started our companies at about the same time.
[00:45:42.040 --> 00:45:43.400] He went venture capital.
[00:45:43.800 --> 00:45:46.240] He raised money and we didn't.
[00:45:46.880 --> 00:45:55.120] And so the first six months, he was doing better because he had money in the bank and he, you know, he wasn't suffering as much as John and I were.
[00:45:55.120 --> 00:45:56.240] Yep, yep, yep, yep.
[00:45:56.240 --> 00:46:01.680] But then, you know, 12 months in, John and I are both full-time.
[00:46:01.680 --> 00:46:03.920] We'd both quit our previous things.
[00:46:03.920 --> 00:46:09.520] We're already making probably maybe even a better salary than Dave is at that point.
[00:46:10.400 --> 00:46:16.400] And then since then, it's, you know, maybe Dave was looking at us going, man, I wish I'd done the bootstrap thing.
[00:46:16.960 --> 00:46:24.400] But then he just sold to Spotify, and maybe it changes again, you know, the calculus.
[00:46:24.400 --> 00:46:35.920] So how do you think through that stuff when, and, and, and, and then also, and Dave was raising money because he wanted to own the podcast analytics space.
[00:46:35.920 --> 00:46:36.320] Yep.
[00:46:36.640 --> 00:46:43.680] Not a huge market, but he wanted to own that space, and arguably he accomplished it.
[00:46:43.680 --> 00:46:49.200] Arguably, his timing was better than the six podcast analytics companies that had come before him.
[00:46:49.200 --> 00:46:50.960] And so it paid off.
[00:46:50.960 --> 00:46:54.400] How do you think about that calculus of?
[00:46:54.400 --> 00:46:56.800] And clearly, chart mogul's gone a different route.
[00:46:56.800 --> 00:46:59.760] They don't want to own the market in terms of market share.
[00:47:00.800 --> 00:47:02.400] They're doing a different way.
[00:47:02.400 --> 00:47:06.080] So, how should people be thinking about that calculus?
[00:47:06.640 --> 00:47:08.160] Is it a strategic thing?
[00:47:08.160 --> 00:47:09.760] Is it a personal thing?
[00:47:09.760 --> 00:47:13.040] Should bootstrap companies try to own their market?
[00:47:13.040 --> 00:47:16.480] I think there's two really important questions you have to ask yourself.
[00:47:16.480 --> 00:47:19.120] One, the personal thing.
[00:47:19.120 --> 00:47:20.080] What do you want?
[00:47:20.080 --> 00:47:20.400] Right?
[00:47:21.040 --> 00:47:35.000] Like, Dave, I don't know, Dave, but like, I could see a world where if I was in his shoes and I raised money and I went balls to the wall and I failed, let's say someone else came along, Spotify came out with their own stuff, you know, they have to shut the company down.
[00:47:35.800 --> 00:47:36.200] Yeah.
[00:47:36.200 --> 00:47:38.920] There's a world where he learned those lessons.
[00:47:38.920 --> 00:47:43.160] And half the time you or I would learn those lessons with a bootstrap company, right?
[00:47:43.160 --> 00:47:45.320] Because money is speed, right?
[00:47:45.640 --> 00:47:48.760] And so I think it's like, what do you want?
[00:47:48.760 --> 00:47:51.560] Like, what do you, do you want the quickest path to learning, right?
[00:47:51.560 --> 00:47:55.640] If you want the quickest path to learning, maybe fundraising is the right way to do it, right?
[00:47:55.640 --> 00:47:58.680] And it's, it's never, like we were talking about before, it's never a binary thing.
[00:47:58.680 --> 00:48:00.440] There's not like one thing you want, right?
[00:48:00.440 --> 00:48:03.160] But there's a set of values that you want.
[00:48:03.160 --> 00:48:08.040] And those are the values that you like, even us, like we didn't want to grow at all costs, right?
[00:48:08.040 --> 00:48:10.440] Like we didn't want to be a large company at all costs.
[00:48:10.440 --> 00:48:13.320] We wanted to like protect certain aspects of our culture.
[00:48:13.320 --> 00:48:17.960] We wanted to protect certain aspects of like the value people were getting, et cetera.
[00:48:17.960 --> 00:48:20.040] And so I think that's the biggest thing is like the personal.
[00:48:20.040 --> 00:48:25.320] And then another question is, is like, is it the right time for funding?
[00:48:25.320 --> 00:48:31.720] So there might be, funding might be off the table for a bunch of things, for a bunch of the personal reasons.
[00:48:31.720 --> 00:48:33.800] But then it's like, no, I want to build a big company.
[00:48:33.800 --> 00:48:35.400] And then is it the right time?
[00:48:35.400 --> 00:48:44.120] ProfitWill did not raise money at all, but we should have raised money probably four or five years ago, like 100%.
[00:48:44.440 --> 00:48:52.440] And the reason is, is because one, one point we should have raised money is, and this is pure hindsight, we wouldn't have known at the time.
[00:48:52.440 --> 00:48:53.880] So we wouldn't have done it.
[00:48:53.880 --> 00:48:59.720] We should have raised money when we realized we were doing a free product in a financial space that required accuracy.
[00:48:59.800 --> 00:49:00.760] Should have raised money.
[00:49:01.400 --> 00:49:04.040] Would have shaved probably a year off of our trajectory.
[00:49:04.360 --> 00:49:11.240] And then the other time we should have raised money is like when we started getting really good, repeatable growth out of our sales team.
[00:49:11.240 --> 00:49:12.280] Just should have raised money.
[00:49:12.280 --> 00:49:16.000] Because that's, you know, that's speed, you know, dump the money in, speed goes out.
[00:49:16.000 --> 00:49:19.840] And our metric, we were like really proud of like our LTV to CAC ratio.
[00:49:14.840 --> 00:49:22.160] And it was like, no, like, that's super cute.
[00:49:22.320 --> 00:49:30.560] But it also means that like we're not growing fast enough because we're not investing as much, you know, because we're getting all this like, you know, this low CAC, like we're not investing.
[00:49:30.560 --> 00:49:33.360] So those are the two things I think are really important.
[00:49:33.360 --> 00:49:37.680] And I don't know, ultimately, like you got to be at peace with your decisions.
[00:49:37.680 --> 00:49:43.440] And I think if we do those proactively, it makes the journey that much harder or that much easier, sorry.
[00:49:43.440 --> 00:49:52.800] Because if Dave theoretically had that thought process before he started chartable or like right in the beginning, if it blew up, he did the thing he was supposed to do.
[00:49:52.800 --> 00:49:54.080] If he sells it, great.
[00:49:54.080 --> 00:49:55.760] He did the thing he was supposed to do.
[00:49:55.760 --> 00:49:56.160] Yeah.
[00:49:56.960 --> 00:49:59.200] How do you do the calculation?
[00:49:59.200 --> 00:50:00.800] I mean, obviously it's hard.
[00:50:00.800 --> 00:50:01.440] Yeah.
[00:50:01.440 --> 00:50:09.920] But it sounds like you recognized the threat and the opportunity of the billing side.
[00:50:09.920 --> 00:50:24.720] I think I read another interview, or you said this in your acquisition blog post that you had met the people from Paddle and you had said to your engineer, like, hey, if we're going to build billing, we got to do it now because these guys are doing it the way I would do it.
[00:50:25.120 --> 00:50:29.200] So obviously you were thinking about that threat and opportunity.
[00:50:29.520 --> 00:50:45.120] And there's like this threading of the needle of like, if we don't move now, like we either, we either partner up with somebody else, get acquired, whatever, or we may miss our window of opportunity here.
[00:50:45.120 --> 00:50:45.440] Yeah.
[00:50:45.440 --> 00:50:48.320] Or we have to raise money and build it ourselves.
[00:50:48.880 --> 00:50:51.200] How do you think founders should be thinking about that?
[00:50:51.200 --> 00:50:54.000] About the threats and the opportunities and the timing?
[00:50:54.000 --> 00:50:54.560] Yeah.
[00:50:54.560 --> 00:50:58.400] It's very possible, John and I could hold on to Transistor longer than we should.
[00:50:59.640 --> 00:51:08.280] It's really hard to come to peace with some of these things when, like, before you should, but that's what you should really focus on.
[00:51:08.280 --> 00:51:17.480] So, what I mean by that is, like, you and John, like, I don't know what your conversations are like, but maybe it's like, hey, we want to keep growing.
[00:51:17.480 --> 00:51:19.800] Here are some of our non-negotiables, though.
[00:51:19.800 --> 00:51:21.000] We don't want to raise money.
[00:51:21.000 --> 00:51:24.440] That changes the stakes, that changes our outcome, whatever it is.
[00:51:24.440 --> 00:51:27.640] We, I don't want to work more than X hours a week.
[00:51:27.640 --> 00:51:30.120] You, we both don't want to work that much, or whatever.
[00:51:30.120 --> 00:51:32.280] I mean, not saying you're not working, but you get what I'm saying.
[00:51:32.280 --> 00:51:33.800] We don't want to work 80 hours a week, right?
[00:51:33.800 --> 00:51:34.120] Yeah.
[00:51:34.360 --> 00:51:35.320] Whatever those are.
[00:51:35.320 --> 00:51:38.840] And we will grow at the pace that sustains these four things.
[00:51:38.840 --> 00:51:47.080] And if that means that this is a 10-year product, or if that means that this is only a three-year product because someone comes in and eats us up, totally fine.
[00:51:47.080 --> 00:51:47.960] You know what I mean?
[00:51:47.960 --> 00:51:49.560] That's getting peace with that.
[00:51:49.560 --> 00:51:55.080] I think for us, so the conversation that you're reading, I had interviewed Christian, the CEO of Paddle.
[00:51:55.320 --> 00:51:57.240] This was actually four or five years ago.
[00:51:57.240 --> 00:51:58.680] That's when that took place.
[00:51:59.240 --> 00:52:06.280] And we think about the world, ProfitWell and Paddle, we think about the same way, like in a very, I would say, unique way.
[00:52:06.280 --> 00:52:28.120] And the way that we think about things is, and I think it's true, first kind of 10, 15 years of SaaS in this market was all about creating products that just kind of like helped me show my boss that I was doing work or like gave me this like infrastructure to kind of do the work.
[00:52:28.120 --> 00:52:30.600] And what I mean by that is like you were the expert.
[00:52:30.600 --> 00:52:35.800] You were the expert sitting in your chair, and they just enabled you to use your expertise, right?
[00:52:36.120 --> 00:52:44.080] I think this next wave that we're in is the software creator is choosing problems where they should know better.
[00:52:44.080 --> 00:52:47.200] Because I don't, I think we were tweeting about this.
[00:52:44.280 --> 00:52:50.720] Justin, yeah, I don't know how to get podcast subscribers.
[00:52:51.040 --> 00:52:53.200] You know more about podcasts than I do.
[00:52:53.200 --> 00:52:54.240] Just do it for me.
[00:52:54.240 --> 00:52:54.640] Yeah.
[00:52:54.640 --> 00:52:55.600] Same with hosting, right?
[00:52:55.600 --> 00:52:58.720] Like, I don't, like, even that part, like, I don't know how to like host everything.
[00:52:58.720 --> 00:52:59.760] I don't want to figure this out.
[00:52:59.760 --> 00:53:00.400] Just do it for me.
[00:53:00.400 --> 00:53:00.640] Right.
[00:53:00.640 --> 00:53:01.600] And that's what Transistor does.
[00:53:01.600 --> 00:53:02.480] It was just so beautiful.
[00:53:02.480 --> 00:53:08.240] And so, long story short, when I met Christian, I'd never heard someone talk that way except us.
[00:53:08.240 --> 00:53:11.920] We were the ones who always talked about the way he like finished my, like, literally finished my sentence.
[00:53:11.920 --> 00:53:12.640] He's like, yeah, yeah, yeah.
[00:53:12.960 --> 00:53:14.800] And it was like a Kismet moment.
[00:53:14.800 --> 00:53:16.560] And I literally left and called Facundo.
[00:53:16.560 --> 00:53:20.240] And I was like, hey, man, this is the first person I've ever met that gets it.
[00:53:20.240 --> 00:53:20.880] We should build this.
[00:53:20.880 --> 00:53:23.120] Like, if we're going to build it, we should build it.
[00:53:23.360 --> 00:53:26.560] But to answer your question, I think that it's really hard.
[00:53:26.560 --> 00:53:28.800] Like, you have to have that thesis.
[00:53:29.120 --> 00:53:34.960] And then I think you have to have those pre-conversations about what is the outcome you want.
[00:53:34.960 --> 00:53:37.680] And then be very open to those outcomes.
[00:53:37.680 --> 00:53:47.120] Like, and it has to be like, I mean, we've all heard the fable about the guys in the boat or the guys stranded and God, why wouldn't you help me?
[00:53:47.120 --> 00:53:48.960] And God's like, well, I sent you the boat.
[00:53:48.960 --> 00:53:49.920] I sent you the person.
[00:53:49.920 --> 00:53:51.920] I sent those four people to help you and you didn't take it.
[00:53:51.920 --> 00:53:52.160] Right.
[00:53:52.160 --> 00:53:53.840] So you do have to take the opportunities, right?
[00:53:53.840 --> 00:53:55.040] It's not going to just come to you.
[00:53:55.040 --> 00:53:55.440] Yeah.
[00:53:55.440 --> 00:53:59.920] But like if you have those conversations up front, like we had slides in our board deck.
[00:53:59.920 --> 00:54:01.440] Here are our potential acquirers.
[00:54:01.440 --> 00:54:03.600] Here's where status is with all those conversations.
[00:54:03.600 --> 00:54:08.240] And we had that slide in that conversation for years before we actually did anything about it.
[00:54:08.240 --> 00:54:10.320] Like we understood like, here's where the market was.
[00:54:10.320 --> 00:54:11.280] Here's where we could go.
[00:54:11.280 --> 00:54:11.680] Right.
[00:54:12.400 --> 00:54:14.880] We also had a slide about who we could acquire as well.
[00:54:14.880 --> 00:54:18.400] And then in terms of identifying the market, a lot of the market will come to you.
[00:54:18.400 --> 00:54:22.720] Like, you'll be big enough, like, you'll have made those relationships with the right people.
[00:54:22.720 --> 00:54:25.520] And then, all of a sudden, like, hey, I was thinking about this.
[00:54:25.520 --> 00:54:27.760] Like, we have this new strategy for the next year.
[00:54:27.760 --> 00:54:29.520] Like, you guys would fit into it and want to talk.
[00:54:29.520 --> 00:54:31.720] And then you can make those decisions based on that.
[00:54:31.720 --> 00:54:32.120] Yeah.
[00:54:29.920 --> 00:54:32.360] Yeah.
[00:54:32.680 --> 00:54:38.120] Well, and I think there's also, I mean, it's tricky because there's so many dynamics.
[00:54:38.120 --> 00:54:41.000] I'm in my 40s.
[00:54:41.000 --> 00:54:42.600] And I think John.
[00:54:42.680 --> 00:54:43.560] I still don't believe it.
[00:54:44.440 --> 00:54:45.240] He looks so young.
[00:54:45.240 --> 00:54:46.680] He looks such like a child.
[00:54:46.680 --> 00:54:47.720] No, I'm just kidding.
[00:54:49.880 --> 00:54:54.760] I think John has the same feeling, though, of we are kind of an old school company.
[00:54:54.760 --> 00:55:01.160] You know, we're like an like Transistor is a fairly simple product with a very small team.
[00:55:01.480 --> 00:55:11.880] And if the next generation of SaaS, for example, is instead of paying for Canva, where you go in and you create these things and they've done some for you, they have templates.
[00:55:12.280 --> 00:55:26.040] But the next version of Canva is some sort of AI that just takes all your inputs and generat

Prompt 2: Key Takeaways

Now please extract the key takeaways from the transcript content I provided.

Extract the most important key takeaways from this part of the conversation. Use a single sentence statement (the key takeaway) rather than milquetoast descriptions like "the hosts discuss...". 

Limit the key takeaways to a maximum of 3. The key takeaways should be insightful and knowledge-additive. 

IMPORTANT: Return ONLY valid JSON, no explanations or markdown. Ensure:
- All strings are properly quoted and escaped
- No trailing commas
- All braces and brackets are balanced
Format: {"key_takeaways": ["takeaway 1", "takeaway 2"]}

Prompt 3: Segments

Now identify 2-4 distinct topical segments from this part of the conversation.

For each segment, identify:
- Descriptive title (3-6 words)  
- START timestamp when this topic begins (HH:MM:SS format)
- Double check that the timestamp is accurate - a timestamp will NEVER be greater than the total length of the audio
- Most important Key takeaway from that segment. Key takeaway must be specific and knowledge-additive.
- Brief summary of the discussion

IMPORTANT: The timestamp should mark when the topic/segment STARTS, not a range. Look for topic transitions and conversation shifts.

Return ONLY valid JSON. Ensure all strings are properly quoted, no trailing commas:
{
  "segments": [
    {
      "segment_title": "Topic Discussion", 
      "timestamp": "01:15:30",
      "key_takeaway": "main point from this segment",
      "segment_summary": "brief description of what was discussed"
    }
  ]
}

Timestamp format: HH:MM:SS (e.g., 00:05:30, 01:22:45) marking the START of each segment.

Prompt 4: Media Mentions

Now scan the transcript content I provided for ACTUAL mentions of specific media titles:

Find explicit mentions of:
- Books (with specific titles)
- Movies (with specific titles)  
- TV Shows (with specific titles)
- Music/Songs (with specific titles)

DO NOT include:
- Websites, URLs, or web services
- Other podcasts or podcast names

IMPORTANT: 
- Only include items explicitly mentioned by name. Do not invent titles.
- Valid categories are: "Book", "Movie", "TV Show", "Music"
- Include the exact phrase where each item was mentioned
- Find the nearest proximate timestamp where it appears in the conversation
- THE TIMESTAMP OF THE MEDIA MENTION IS IMPORTANT - DO NOT INVENT TIMESTAMPS AND DO NOT MISATTRIBUTE TIMESTAMPS
- Double check that the timestamp is accurate - a timestamp will NEVER be greater than the total length of the audio
- Timestamps are given as ranges, e.g. 01:13:42.520 --> 01:13:46.720. Use the EARLIER of the 2 timestamps in the range.

Return ONLY valid JSON. Ensure all strings are properly quoted and escaped, no trailing commas:
{
  "media_mentions": [
    {
      "title": "Exact Title as Mentioned",
      "category": "Book",
      "author_artist": "N/A",
      "context": "Brief context of why it was mentioned",
      "context_phrase": "The exact sentence or phrase where it was mentioned",
      "timestamp": "estimated time like 01:15:30"
    }
  ]
}

If no media is mentioned, return: {"media_mentions": []}

Prompt 5: Context Setup

You are an expert data extractor tasked with analyzing a podcast transcript. 
I will provide you with part 2 of 2 from a podcast transcript. 
I will then ask you to extract different types of information from this content in subsequent messages. Please confirm you have received and understood the transcript content.

Transcript section:
n for years before we actually did anything about it.
[00:54:08.240 --> 00:54:10.320] Like we understood like, here's where the market was.
[00:54:10.320 --> 00:54:11.280] Here's where we could go.
[00:54:11.280 --> 00:54:11.680] Right.
[00:54:12.400 --> 00:54:14.880] We also had a slide about who we could acquire as well.
[00:54:14.880 --> 00:54:18.400] And then in terms of identifying the market, a lot of the market will come to you.
[00:54:18.400 --> 00:54:22.720] Like, you'll be big enough, like, you'll have made those relationships with the right people.
[00:54:22.720 --> 00:54:25.520] And then, all of a sudden, like, hey, I was thinking about this.
[00:54:25.520 --> 00:54:27.760] Like, we have this new strategy for the next year.
[00:54:27.760 --> 00:54:29.520] Like, you guys would fit into it and want to talk.
[00:54:29.520 --> 00:54:31.720] And then you can make those decisions based on that.
[00:54:31.720 --> 00:54:32.120] Yeah.
[00:54:29.920 --> 00:54:32.360] Yeah.
[00:54:32.680 --> 00:54:38.120] Well, and I think there's also, I mean, it's tricky because there's so many dynamics.
[00:54:38.120 --> 00:54:41.000] I'm in my 40s.
[00:54:41.000 --> 00:54:42.600] And I think John.
[00:54:42.680 --> 00:54:43.560] I still don't believe it.
[00:54:44.440 --> 00:54:45.240] He looks so young.
[00:54:45.240 --> 00:54:46.680] He looks such like a child.
[00:54:46.680 --> 00:54:47.720] No, I'm just kidding.
[00:54:49.880 --> 00:54:54.760] I think John has the same feeling, though, of we are kind of an old school company.
[00:54:54.760 --> 00:55:01.160] You know, we're like an like Transistor is a fairly simple product with a very small team.
[00:55:01.480 --> 00:55:11.880] And if the next generation of SaaS, for example, is instead of paying for Canva, where you go in and you create these things and they've done some for you, they have templates.
[00:55:12.280 --> 00:55:26.040] But the next version of Canva is some sort of AI that just takes all your inputs and generates all of these assets for you and then shows you how to deploy them.
[00:55:26.680 --> 00:55:32.360] The next version of podcasting would be like the hardest part is content, right?
[00:55:32.360 --> 00:55:40.920] And that's where we've, the dynamics of the market really rely on people being incredibly motivated.
[00:55:40.920 --> 00:55:41.240] Yeah.
[00:55:41.880 --> 00:55:46.600] Most of our churn happens, you know, when I email people and I email them manually still.
[00:55:46.920 --> 00:55:49.560] When they cancel, I say, hey, just notice you canceled.
[00:55:49.560 --> 00:55:50.280] You know, what's going on?
[00:55:50.440 --> 00:55:51.480] I don't want to do it anymore.
[00:55:51.480 --> 00:55:56.280] And most of the times they have zero or one episodes.
[00:55:57.080 --> 00:55:58.600] That's the biggest one.
[00:55:58.920 --> 00:56:05.560] And, you know, if they get 10 episodes, they're much more likely to stick around.
[00:56:05.560 --> 00:56:11.640] If, you know, if they create an episode and submit it to Spotify, more likely to stick around.
[00:56:11.640 --> 00:56:16.800] If they create an episode and then figure out how to submit to Apple, very likely to stick around.
[00:56:16.800 --> 00:56:18.400] Like, it's just these hoops are.
[00:56:18.720 --> 00:56:26.080] But the next version of podcasting could be all AI-based.
[00:56:26.080 --> 00:56:30.640] It's like you don't even need to do anything anymore.
[00:56:30.640 --> 00:56:34.640] You just get it to generate the content for you.
[00:56:34.640 --> 00:56:35.600] It has your voice.
[00:56:35.600 --> 00:56:38.560] It automatically spits it out.
[00:56:38.560 --> 00:56:40.720] And then you just get to upload it.
[00:56:40.720 --> 00:56:49.600] And it's based on, like, let's say it can create a podcast for you automatically based on your tweets and your blog posts from the past month and everyone you interacted with.
[00:56:49.600 --> 00:56:52.640] And it just popped and it just does it and it's done for you.
[00:56:52.640 --> 00:56:54.560] So maybe that's the next version.
[00:56:54.560 --> 00:56:55.120] Yeah.
[00:56:55.120 --> 00:56:58.720] I would say that that's, I don't think that's the next version.
[00:56:58.720 --> 00:57:18.960] I think that that's so the one part of the thesis that I didn't talk about is that I think that the product and the team and the customer are still going to be reserved by whoever you're serving, whatever type of business or whatever you have a customer.
[00:57:18.960 --> 00:57:23.760] So like in your case, I'm still going to want to create the podcast, right?
[00:57:23.760 --> 00:57:28.960] Now there's a bunch of things around the podcast creation that like Riverside should do more of.
[00:57:28.960 --> 00:57:32.960] There's a lot of things around the distribution that I think you guys should do more of.
[00:57:32.960 --> 00:57:37.360] Like there's a bunch of automatable things around that that are probably up there.
[00:57:37.360 --> 00:57:45.120] I don't think, I do think some people will do like some automated podcasts, like Siri Frankenstein Monster kind of a thing.
[00:57:45.120 --> 00:57:46.880] But like, I think it's more.
[00:57:46.880 --> 00:57:47.200] Yeah.
[00:57:47.200 --> 00:58:06.920] What I would do, if I was trying to like look into this thesis for how it could better, you know, help my business, I would do all of the steps between pre-ide all the way through to like successful podcast.
[00:58:07.080 --> 00:58:14.920] And I would just line those out and I would categorize them based on probably creative, pre-production, post-production.
[00:58:14.920 --> 00:59:44.400] during like i'd categorize like five or six categories five or six colors on all those steps and then i would look at the color that most aligns towards transistor and be like hmm these three things they're like right next to what we're already doing they don't really require that much lift and they would be a differentiator these three things yeah i have no idea how we would solve those problems if we could that would be genius but like i have no idea so we're gonna put those in the back burner right that's how i would look at this like and i think that's that's how you can fix that yeah yeah there's there's other there are probably adjacent things and again the nice thing is you get to fit that to well then you get to decide on the trade-offs do we want to hire more people do we want to raise money here's my transistor idea i want you to create an ad campaign right from whatever episode and you can use the cover art and you just i don't know like you just automatically spit it out it's probably a million times more complicated than i think it is and then just give me a button hey man just click this button and i'd be like okay like i'm gonna set this up because i think that that's like i'll i'll manually do it on my end but like there's something there for like podcast distribution and i don't know there's there's there's something there beyond what you're doing, but that's what i want that's what i want as one user like like you want an automated uh promotion campaign for a podcast.
[00:59:44.400 --> 00:59:49.440] Yes, I don't know what because I there was a good thread I'm sure you saw it.
[00:59:49.440 --> 01:00:05.280] I think it was NPR or something like that that talked about Where most podcast promotion like for charting and for a bunch of other things comes from like good ad campaigns where like they do ad campaigns because Apple, Spotify, et cetera, they value like the new users or whatever.
[01:00:05.280 --> 01:00:14.720] I couldn't remember all the details of it, but it was one of those things where I read that and I was like, that's great because I can get all the users already on my list, but I want other users, right?
[01:00:14.720 --> 01:00:19.360] So I've run like, I can't remember, what's the podcast platform?
[01:00:19.360 --> 01:00:22.000] It's got really simple ads you can grab.
[01:00:22.000 --> 01:00:22.800] Overcast?
[01:00:22.800 --> 01:00:25.920] Yeah, I've done overcast ads and that works pretty well.
[01:00:25.920 --> 01:00:33.200] But I know that there's like, and again, I'm not an expert in Facebook, LinkedIn, all these other stuff, but like, just give me a button.
[01:00:33.200 --> 01:00:33.680] Cool.
[01:00:33.680 --> 01:00:34.080] There we go.
[01:00:34.080 --> 01:00:36.320] The episode's out or the podcast or whatever it is.
[01:00:36.320 --> 01:00:50.400] Well, and certainly the most fertile ground for that would be dynamically inserted ads in other podcasts that have a similar audience to you, because that's where most of the uplift happens.
[01:00:50.400 --> 01:01:11.920] The reason that all the networks are advertising each other's shows, you know, like Malcolm Gladwell, I'm guessing 80% of their like lift for a new show just comes from promoting other podcasts and even in their own network because you're reaching people where they're at.
[01:01:11.920 --> 01:01:12.720] Totally.
[01:01:12.720 --> 01:01:14.880] Well, that might be that idea.
[01:01:14.880 --> 01:01:16.640] I'm realizing now I think about more.
[01:01:16.640 --> 01:01:19.040] This might be beyond the values you and John have set.
[01:01:19.040 --> 01:01:22.480] Like in terms of like, we're going to meet seven people just for that one feature.
[01:01:22.480 --> 01:01:22.960] But yeah, yeah.
[01:01:23.200 --> 01:01:24.640] Now I think we're actually on that one.
[01:01:24.640 --> 01:01:29.200] I think we're close because now we have a simple dynamic ad insertion tool.
[01:01:29.200 --> 01:03:05.920] Oh, that's cool and so we can create a layer on top which says we will help you guys cross pollinate that's great and we can do it manually at first just saying okay this is just for shows that have more than a thousand listeners and then we'll we'll match you up that's great but eventually that could be that could happen for sure yeah one question i have because we're dealing with this right now did do your employees have equity how do how do you guys figure that stuff out yeah so i think i'm gonna do a thread about this tomorrow um or at least this week um what's funny is the previous startup i was at did not in my opinion handle equity in a great way like everyone got equity but they were really cagey about the value of that equity like they would be like you get this many shares but they wouldn't describe like what that was worth right and this was 10 years ago where that was more common yeah so with profile well we very much focused on like okay like if there's an exit am i supposed to get 80 of this thing like is that how that works right like i think i should get a really large chunk and probably the biggest chunk probably the biggest chunk but like i don't know the stories like the mail chimp story i mean mailchimps it's it's it's obviously a great success but like it felt and i don't know how it felt to them like i think they set expectations with their team really well but like it probably felt weird that like the team or very few people on the team had equity, like they got a bonus, but like it was an $11 billion dollar exit.
[01:03:05.920 --> 01:03:08.480] Like, it's yeah that feels weird, right?
[01:03:08.480 --> 01:03:09.120] Like, I don't know.
[01:03:09.120 --> 01:03:11.600] Like, and it's an emotional and personal thing.
[01:03:11.600 --> 01:03:24.560] So, what we did is, um, interestingly enough, when we were talking about this, Andrew Mason, the group on guy and the descript guy now, he published this article when he was doing detour, which was like an actually really cool idea.
[01:03:24.560 --> 01:03:37.360] And he ended up talking about how like they did this progressive equity system where it was like basically the founder would definitely get the most, but it was like not egregiously the most.
[01:03:37.360 --> 01:03:41.040] So, we didn't do something specific as that, but yeah, everyone had equity.
[01:03:41.040 --> 01:03:46.080] Um, we accelerated everyone's vesting as long as they were with the company for more than a year.
[01:03:46.080 --> 01:03:50.320] We did a bunch of things to like help basically make sure that so.
[01:03:50.320 --> 01:03:52.480] Was this stock options?
[01:03:52.480 --> 01:04:02.400] Like, you, you, you, you gave them options, or no, it's kind of cool is like they had what are called um uh LLC profit interests, basically, or membership interests.
[01:04:02.560 --> 01:04:04.560] Okay, you're an LLC, yeah.
[01:04:04.560 --> 01:04:08.640] And so, which was a whole nother complicated thing to figure out.
[01:04:08.640 --> 01:04:16.240] Um, but I think that was, yeah, that was kind of the benefit is like once you had your shares, you technically owned them, which was kind of cool.
[01:04:16.240 --> 01:04:19.680] Like, you didn't have to, there was no strike price, um, anything like that.
[01:04:19.680 --> 01:04:21.920] They were basically founder shares, which is kind of great.
[01:04:21.920 --> 01:04:25.840] Um, and so yeah, they um didn't have to exercise them.
[01:04:25.840 --> 01:04:34.560] They didn't, they, if they left, we had plenty of people get, you know, good amount of money like that don't work here anymore, um, you know, which, you know, I think is great.
[01:04:34.560 --> 01:04:37.840] Now, at the end of the day, like, I got a lot.
[01:04:37.840 --> 01:04:46.720] Uh, so to only to only say that, um, bluntly, I have more money than many generations of my family will ever need.
[01:04:46.720 --> 01:05:02.920] And so it was one of those things that, um, like, it still is weird because even though we did this, it's like, I don't want to say there's guilt because I worked my butt off for it, but there's a little bit of guilt of like, well, I have this much, this person, like, did I really do X more than they did?
[01:04:59.760 --> 01:05:03.800] Like, I don't know, right?
[01:05:03.960 --> 01:05:07.960] Like, so it's an interesting, and I think this is also a very personal thing.
[01:05:07.960 --> 01:05:10.760] Like, don't leave that exit.
[01:05:10.760 --> 01:05:15.960] I wanted to make sure everyone was like, not necessarily happy because I think, you know, people can be unhappy.
[01:05:15.960 --> 01:05:21.000] Like, we had people cry over $10,000, like, tears of joy.
[01:05:21.400 --> 01:05:23.080] And then we had people pissed off.
[01:05:23.080 --> 01:05:24.760] They were only getting $100,000.
[01:05:24.760 --> 01:05:27.240] Like, money is a really weird thing with people.
[01:05:27.240 --> 01:05:37.480] And so, long story short, just be, just make sure you're like, you know, you don't regret how it looks, or not how it looks, but you don't regret how it all shakes out at the end.
[01:05:37.480 --> 01:05:38.920] I think that's an important thing.
[01:05:38.920 --> 01:05:39.400] Yeah.
[01:05:40.040 --> 01:05:41.720] Well, congrats, man.
[01:05:41.720 --> 01:05:42.360] Thanks, brother.
[01:05:42.520 --> 01:05:48.680] Like, to have an exit, I've always felt like it's okay to start a company for money.
[01:05:48.680 --> 01:05:49.320] Yeah.
[01:05:49.320 --> 01:05:55.240] And I also came from, you know, quite meager means.
[01:05:55.800 --> 01:05:57.480] I'm not a wealthy family.
[01:05:57.480 --> 01:06:07.480] I also lived many years of my life, like working a paycheck, but working hard and trying to feed kids and pay for a mortgage and everything else.
[01:06:07.960 --> 01:06:12.600] And I think it's okay and it should be celebrated when founders have a good exit.
[01:06:12.600 --> 01:06:13.400] So congrats.
[01:06:13.400 --> 01:06:14.440] I think it's great.
[01:06:14.440 --> 01:06:18.040] I think it's great that you did well.
[01:06:18.040 --> 01:06:22.760] And now that you've got this new adventure with Paddle, it's pretty awesome.
[01:06:22.760 --> 01:06:23.640] I'm pretty excited.
[01:06:23.640 --> 01:06:27.400] And yeah, I'm sure there'll be a lot more.
[01:06:27.400 --> 01:06:29.640] Well, we'll see a lot more content out of Paddle, I'm guessing.
[01:06:30.040 --> 01:06:31.400] Is that the next part?
[01:06:31.400 --> 01:06:35.960] Yeah, there's a, I think I tweeted rather cheekily in it, but I mean it.
[01:06:35.960 --> 01:06:41.640] Like, if you ever wanted to see what we could do with funding, get ready because it's going to be exciting.
[01:06:41.640 --> 01:06:57.200] Like, we're like, people don't realize, like, one, people don't realize we're the only bootstrap company in our space, but also, like, to do some of the ideas we did, we were like scraping by and doing like terrible decision-making around, like, you know, oh, we have to squeeze this amount of this or that.
[01:06:57.200 --> 01:07:00.960] And now we don't have to worry about all of those decisions anymore.
[01:07:00.960 --> 01:07:02.880] And so it'll, it should be a good time.
[01:07:02.880 --> 01:07:03.680] Yeah.
[01:07:04.000 --> 01:07:04.240] Yeah.
[01:07:04.240 --> 01:07:09.360] That'll be interesting for you to experience the other side of that.
[01:07:09.360 --> 01:07:14.160] Because if you were quite frugal before, you know, there's pros and cons to everything.
[01:07:14.160 --> 01:07:24.640] But sometimes, certainly, the disadvantage of frugalness is that you're not willing to try more experiments that could just waste 10 grand, for example.
[01:07:24.640 --> 01:07:26.560] Are we willing to make this 10 grand bet?
[01:07:26.560 --> 01:07:27.040] Yeah.
[01:07:27.040 --> 01:07:27.680] No.
[01:07:28.000 --> 01:07:33.360] Well, maybe we should make that 10 grand bet because that 10 grand bet might turn into 100 grand.
[01:07:33.360 --> 01:07:33.680] Yeah.
[01:07:33.680 --> 01:07:35.040] That would be a good bet, you know?
[01:07:35.040 --> 01:07:36.160] There'll be a lot of good bets.
[01:07:36.160 --> 01:07:37.360] Yeah, that's great.
[01:07:37.360 --> 01:07:37.840] Yeah.
[01:07:38.080 --> 01:07:39.440] Congrats again.
[01:07:39.440 --> 01:07:40.960] Congrats to you and your team.
[01:07:40.960 --> 01:07:41.440] Thanks, Bill.
[01:07:41.680 --> 01:07:42.240] All the best.
[01:07:42.240 --> 01:07:43.360] All the best luck.
[01:07:43.920 --> 01:07:50.000] And let's chat again in like six months and see how things are going over there.
[01:07:54.800 --> 01:07:56.240] Thanks again for listening.
[01:07:56.240 --> 01:07:58.560] Be sure to follow Patrick on Twitter.
[01:07:58.560 --> 01:08:00.000] He is Pattikus.
[01:08:00.000 --> 01:08:02.560] All of the links are in the show notes.
[01:08:02.560 --> 01:08:08.640] And let me do some shout outs to our monthly supporters on Patreon.
[01:08:08.640 --> 01:08:10.640] We have Jason Charnes.
[01:08:10.640 --> 01:08:14.480] By the way, Jason, thanks for mentioning Transistor during your Rails talk.
[01:08:14.800 --> 01:08:16.320] We really appreciate that.
[01:08:16.320 --> 01:08:49.320] Mitchell Davis, Marcel Folley, Alex Payne, Bill Kondo, Anton Zorin, Mitch, Harris Kenney, Oleg, Kulig, Ethan Gunderson, Chris Willow, Ward Sandler, Russell Brown, Noah Prale, Colin Gray, Austin Lovelace, Michael Sitfer, Paul Jarvis, and Jack Ellis, Dan Buda, Darby Frey, Brad from Canada, Adam Duvander, Dave Juncta, and Kyle Fox from getrewardful.com.
[01:08:49.320 --> 01:08:51.000] See you next time.
[01:09:08.360 --> 01:09:12.280] Podcast hosting is provided by transistor.fm.
[01:09:12.280 --> 01:09:23.480] They host our mp3 files, generate our RSS feed, provide us with analytics, and help us distribute the show to Spotify, Apple Podcasts, and more.
[01:09:23.480 --> 01:09:34.520] If you want to start your own podcast or you want to switch to Transistor, go to transistor.fm/slash Justin and get 15% off your first year.

Prompt 6: Key Takeaways

Now please extract the key takeaways from the transcript content I provided.

Extract the most important key takeaways from this part of the conversation. Use a single sentence statement (the key takeaway) rather than milquetoast descriptions like "the hosts discuss...". 

Limit the key takeaways to a maximum of 3. The key takeaways should be insightful and knowledge-additive. 

IMPORTANT: Return ONLY valid JSON, no explanations or markdown. Ensure:
- All strings are properly quoted and escaped
- No trailing commas
- All braces and brackets are balanced
Format: {"key_takeaways": ["takeaway 1", "takeaway 2"]}

Prompt 7: Segments

Now identify 2-4 distinct topical segments from this part of the conversation.

For each segment, identify:
- Descriptive title (3-6 words)  
- START timestamp when this topic begins (HH:MM:SS format)
- Double check that the timestamp is accurate - a timestamp will NEVER be greater than the total length of the audio
- Most important Key takeaway from that segment. Key takeaway must be specific and knowledge-additive.
- Brief summary of the discussion

IMPORTANT: The timestamp should mark when the topic/segment STARTS, not a range. Look for topic transitions and conversation shifts.

Return ONLY valid JSON. Ensure all strings are properly quoted, no trailing commas:
{
  "segments": [
    {
      "segment_title": "Topic Discussion", 
      "timestamp": "01:15:30",
      "key_takeaway": "main point from this segment",
      "segment_summary": "brief description of what was discussed"
    }
  ]
}

Timestamp format: HH:MM:SS (e.g., 00:05:30, 01:22:45) marking the START of each segment.

Prompt 8: Media Mentions

Now scan the transcript content I provided for ACTUAL mentions of specific media titles:

Find explicit mentions of:
- Books (with specific titles)
- Movies (with specific titles)  
- TV Shows (with specific titles)
- Music/Songs (with specific titles)

DO NOT include:
- Websites, URLs, or web services
- Other podcasts or podcast names

IMPORTANT: 
- Only include items explicitly mentioned by name. Do not invent titles.
- Valid categories are: "Book", "Movie", "TV Show", "Music"
- Include the exact phrase where each item was mentioned
- Find the nearest proximate timestamp where it appears in the conversation
- THE TIMESTAMP OF THE MEDIA MENTION IS IMPORTANT - DO NOT INVENT TIMESTAMPS AND DO NOT MISATTRIBUTE TIMESTAMPS
- Double check that the timestamp is accurate - a timestamp will NEVER be greater than the total length of the audio
- Timestamps are given as ranges, e.g. 01:13:42.520 --> 01:13:46.720. Use the EARLIER of the 2 timestamps in the range.

Return ONLY valid JSON. Ensure all strings are properly quoted and escaped, no trailing commas:
{
  "media_mentions": [
    {
      "title": "Exact Title as Mentioned",
      "category": "Book",
      "author_artist": "N/A",
      "context": "Brief context of why it was mentioned",
      "context_phrase": "The exact sentence or phrase where it was mentioned",
      "timestamp": "estimated time like 01:15:30"
    }
  ]
}

If no media is mentioned, return: {"media_mentions": []}

Full Transcript

[00:00:00.240 --> 00:00:03.280] This podcast is hosted by transistor.fm.
[00:00:05.520 --> 00:00:10.720] Maybe my problem is I'm always curious if other people are living a better dream than me.
[00:00:10.720 --> 00:00:12.160] That's probably a therapy.
[00:00:12.160 --> 00:00:14.240] Therapy point you have to figure out.
[00:00:14.240 --> 00:00:14.720] Yeah.
[00:00:15.040 --> 00:00:16.320] That's why you're here today.
[00:00:16.320 --> 00:00:19.360] Dude, if we can be each other's therapists, I'm down for it.
[00:00:33.120 --> 00:00:36.880] Hello and welcome to Build Your SaaS.
[00:00:36.880 --> 00:00:41.920] This is the behind-the-scenes story of building web apps in 2022.
[00:00:41.920 --> 00:00:45.920] I'm Justin Jackson, founder of Transistor.
[00:00:49.440 --> 00:01:05.120] And I just finished chatting with Patrick Campbell, who recently sold his bootstrapped SaaS company, Profit Well, to Paddle, the payment processing billing platform for $200 million.
[00:01:05.120 --> 00:01:06.800] Unbelievable story.
[00:01:06.800 --> 00:01:09.040] I'm not going to say too much before we get into it.
[00:01:09.040 --> 00:01:12.160] It was just an incredible conversation.
[00:01:12.480 --> 00:01:21.920] If you are bootstrapping right now, or you are about to bootstrap, or you have been doing it for years, you will get tons out of this conversation.
[00:01:21.920 --> 00:01:23.840] Let's get into it.
[00:01:27.360 --> 00:01:29.680] You know what I realize with bootstrapping?
[00:01:29.680 --> 00:01:32.320] One of the major downsides is network.
[00:01:32.320 --> 00:01:35.520] Not because you don't have a network, right?
[00:01:35.520 --> 00:01:42.080] Because, but I think you have to actively build it or actively discover the podcast, like all that kind of stuff.
[00:01:42.080 --> 00:01:50.000] When you're venture-backed, you just like, oh, here's like, I'm going to introduce you to three other, you know, portfolio company CEOs or founders or whatever.
[00:01:50.000 --> 00:01:50.720] And it's like, yeah.
[00:01:50.720 --> 00:01:52.880] It's kind of given to you, which is interesting.
[00:01:52.880 --> 00:01:53.280] Yeah.
[00:01:53.080 --> 00:01:54.320] Yeah, yeah, it's true.
[00:01:54.320 --> 00:01:57.520] It's part of the, it's more part of the, the culture.
[00:01:57.520 --> 00:01:58.160] Yeah.
[00:01:58.160 --> 00:02:02.280] I mean, they're both, I think they're both like obviously terribly difficult.
[00:02:02.520 --> 00:02:11.000] And the whole should you or shouldn't you, I don't know if is worthy of debate, like in terms of funding, but like, yeah, it is one of those things that it's a downside that I thought of.
[00:02:11.000 --> 00:02:11.400] Yeah.
[00:02:11.400 --> 00:02:13.000] No, I think we should debate it.
[00:02:13.000 --> 00:02:13.400] All right.
[00:02:13.400 --> 00:02:13.800] Fine.
[00:02:13.800 --> 00:02:14.600] Are we jumping in?
[00:02:14.600 --> 00:02:15.160] Are we in?
[00:02:15.160 --> 00:02:16.200] Are we in this episode?
[00:02:17.400 --> 00:02:19.160] Yeah, let's, let's, let's talk about it.
[00:02:19.160 --> 00:02:22.360] So I've got Patrick Campbell here.
[00:02:22.360 --> 00:02:24.440] Patrick, welcome.
[00:02:24.440 --> 00:02:25.240] What's up, man?
[00:02:25.240 --> 00:02:26.680] You just sold your company.
[00:02:26.680 --> 00:02:27.960] Profit well.
[00:02:27.960 --> 00:02:28.840] I did a thing.
[00:02:28.840 --> 00:02:29.720] To paddle.
[00:02:29.720 --> 00:02:30.520] To paddle.
[00:02:30.520 --> 00:02:37.000] And I have now, I don't know if the video, but I don't know if we're using the video, but I have paddle gear behind me, all kinds of stuff.
[00:02:37.000 --> 00:02:37.800] I'm wearing paddle shoes.
[00:02:37.960 --> 00:02:38.920] That was quick.
[00:02:38.920 --> 00:02:42.280] I got paddle black and yellow sneakers now.
[00:02:42.280 --> 00:02:45.480] Was that that part of the deal that you wanted some sneakers with it too?
[00:02:45.480 --> 00:02:51.160] Yeah, these $80 sneakers were like, that was the deal point that we were going back and forth on.
[00:02:51.480 --> 00:02:53.000] No, I'm an all-in guy, man.
[00:02:53.000 --> 00:02:54.520] Like, once I'm in, I'm all in.
[00:02:54.520 --> 00:02:57.480] So, yeah, it's one of those things that I'm excited about.
[00:02:57.480 --> 00:03:00.440] But yeah, sold the company, joined Paddle.
[00:03:00.440 --> 00:03:02.280] I'm actually in their London office right now.
[00:03:02.440 --> 00:03:03.800] I've been here for about a month.
[00:03:03.800 --> 00:03:04.360] Oh, okay.
[00:03:04.360 --> 00:03:04.920] Yeah, yeah.
[00:03:04.920 --> 00:03:06.920] And so, yeah, this is the new studio.
[00:03:06.920 --> 00:03:10.600] This is why I couldn't figure out focus and stuff like that before we started recording.
[00:03:10.840 --> 00:03:12.840] But yeah, it's been a good time so far.
[00:03:12.840 --> 00:03:14.600] So you're already getting stuff done there.
[00:03:14.600 --> 00:03:17.880] You're like, we got to get the content machine running.
[00:03:18.120 --> 00:03:19.560] If only you knew.
[00:03:19.560 --> 00:03:20.440] Yeah, there's a lot.
[00:03:20.440 --> 00:03:27.640] There's a because there's like integrating, you know, which is like we brought everyone on board.
[00:03:27.640 --> 00:03:33.000] So and thankfully, I mean, we were bootstrapped, so there wasn't a lot of like extra, if that makes sense.
[00:03:33.000 --> 00:03:34.920] So it wasn't like we had a huge finance team.
[00:03:34.920 --> 00:03:37.000] They had a huge finance team, that type of thing.
[00:03:37.480 --> 00:03:42.920] But then there's like a lot of storming and norming in probably good and bad ways.
[00:03:42.920 --> 00:04:24.160] Like good ways in the sense of like, oh, we're good at this like let's bring that over here oh like they're really good at that let's have them take over this and um yeah and so it's been it's been kind of an interesting month like you know that uh that we've been cranking and lots of fun like trust building like i don't think a lot of people with integrations realize like you kind of just assume you have this trust because you have it with your team that you've built over so long and it's like no you're like in an arranged marriage now you kind of have to rebuild it all um which you know which is not so fun so let's go back a bit for people who aren't aware you founded profit well in 2012 yep so started 2012.
[00:04:24.160 --> 00:05:19.880] um it wasn't always yeah it wasn't always in um like sas metrics right you started doing something else first yep so we were then called price intelligently um we still have that brand and product it's part of the profit well suite but um we wanted to help folks um with one of the biggest problems a lot of b2b folks have which is their pricing um we had this little software app a lot of people don't realize it started off as pure software and then basically people asked us to do services on top of the software and we were like no vcs don't like that and then they basically said we'll pay you a lot of money and we were like okay so um yeah that's kind of what started this tech enabled service as it's called and then um a year or so into that we knew we wanted to get to like a more ubiquitous type of software and um we were helping a company as about to ipo with their pricing and they were calculating mrr and churn incorrectly.
[00:05:19.880 --> 00:05:22.680] And so um we wanted more data.
[00:05:22.680 --> 00:05:25.000] That was kind of a good moment of like clarity.
[00:05:25.000 --> 00:05:29.080] And, you know, that's kind of when we started building our subscription financial metrics product.
[00:05:29.080 --> 00:05:39.080] And we've now evolved into a number of different products that help, you basically plug it in and it helps reduce your churn, as well as some other stuff that we've been working around around pricing and stuff like that.
[00:05:39.080 --> 00:05:43.320] And when you started the company, because it wasn't just you who founded it, right?
[00:05:43.640 --> 00:05:45.400] There's quite a few of you, I think.
[00:05:45.800 --> 00:05:47.800] No, it's actually kind of complicated.
[00:05:47.800 --> 00:05:56.360] So it was, it was, I had part-time co-founders, which is not, I would not suggest, although I think you guys kind of did that.
[00:05:56.360 --> 00:06:03.320] So I will, it doesn't, it's not a, it is not a built-in key for success, I think.
[00:06:03.320 --> 00:06:05.160] I think you guys knew each other beforehand.
[00:06:05.160 --> 00:06:06.680] I didn't really know these guys.
[00:06:06.680 --> 00:06:08.280] And everything's great.
[00:06:08.440 --> 00:06:12.760] Yeah, I see three names besides you on the Crunchbase profile.
[00:06:12.760 --> 00:06:13.160] Yeah.
[00:06:13.480 --> 00:06:15.240] It says there was four of you total.
[00:06:15.240 --> 00:06:18.760] No, so here's, here's kind of like the clearer way.
[00:06:18.760 --> 00:06:21.720] So it was myself and these two other guys.
[00:06:22.120 --> 00:06:25.480] They were on our board the entire time, all the way up to the sale.
[00:06:25.480 --> 00:06:31.080] They were advisors, but they never really came into the business and like worked full-time on the business.
[00:06:31.080 --> 00:06:34.200] And there were some misaligned expectations.
[00:06:34.760 --> 00:06:36.280] I don't think anyone's nefarious.
[00:06:36.280 --> 00:06:40.520] I think like, you know, I was a first-time founder, so pretty naive and all that kind of stuff.
[00:06:40.520 --> 00:06:45.240] And they were like, you know, they had never founded anything before, like seriously founded anything before.
[00:06:45.240 --> 00:06:50.120] So I think that like it was one of these things where all kind of mixed together and everything worked out.
[00:06:50.120 --> 00:06:51.480] We're brothers, all that kind of stuff.
[00:06:51.480 --> 00:06:55.800] But it was, it was just me in a room for like 18 hours a day for the first like nine months.
[00:06:55.800 --> 00:07:02.840] And then that's when Peter was brought on, who might be listed in the Crunchbase article, or wherever you're looking.
[00:07:02.840 --> 00:07:05.480] And then Facundo was brought on a little while after that.
[00:07:05.480 --> 00:07:14.200] And so I think that like it's complicated, but like, if I'm referring to my co-founders, I typically am referring to Peter and Facundo, even though they weren't there like day one.
[00:07:14.200 --> 00:07:18.880] And then the other guys are more advisors and board members, if that makes sense.
[00:07:14.600 --> 00:07:19.360] Got it.
[00:07:19.600 --> 00:07:25.520] And what were you doing before Price Intelligently before 2012?
[00:07:25.520 --> 00:07:26.240] Yeah, totally.
[00:07:26.240 --> 00:07:28.160] So I started right out of school.
[00:07:28.160 --> 00:07:29.360] I worked at NSA.
[00:07:29.360 --> 00:07:35.440] I worked in the Intel community, which is fun to say, but it's not as sexy as it sounds.
[00:07:35.680 --> 00:07:36.880] I was an Intel analyst.
[00:07:37.040 --> 00:07:40.320] Were you a Boston grad, like a Boston university grad?
[00:07:40.320 --> 00:07:41.200] No, I went to school.
[00:07:42.080 --> 00:07:43.520] You were in Boston, weren't you?
[00:07:43.520 --> 00:07:44.160] No, not then.
[00:07:44.160 --> 00:07:48.480] So I went to school in Illinois and then was in DC or in Maryland for that.
[00:07:48.640 --> 00:07:49.440] What did you take?
[00:07:49.440 --> 00:07:51.040] What did you take in university?
[00:07:51.280 --> 00:07:53.840] I studied econometrics and math.
[00:07:53.840 --> 00:07:57.360] So a lot of friends, a lot of friends as a child I had.
[00:07:57.360 --> 00:07:58.240] No, yeah.
[00:07:58.320 --> 00:07:59.680] That's my joke at that.
[00:08:00.320 --> 00:08:02.080] What is econometrics?
[00:08:03.680 --> 00:08:15.520] I think a better way to describe what I did was more like applied math, like using math for some sort of outcome, if that makes sense, using economics for some sort of outcome.
[00:08:15.520 --> 00:08:23.120] Honestly, like probably 90% of what I learned and studied was just not applicable, but it kind of taught you how to think, if that makes sense.
[00:08:23.680 --> 00:08:24.080] Okay.
[00:08:24.400 --> 00:08:38.720] It's kind of the way I describe econometrics to some people is like, you know how like in elementary school, I don't know if they do this in Canada, but in the States, like at least they used to when I was growing up, they would teach you that like Columbus discovered America in 1492, right?
[00:08:39.040 --> 00:08:44.400] And then when you get to high school, they're like, actually, it was a bit more complicated.
[00:08:44.400 --> 00:08:47.520] There was like, you know, maybe these folks came down from the Nordics.
[00:08:47.520 --> 00:08:53.920] And then when you get to college, you like learn Columbus was kind of not great, you know, or very debatable.
[00:08:54.320 --> 00:08:55.360] And all these other things.
[00:08:55.360 --> 00:08:57.840] And also the Native American tribes coming off the Bering Strait.
[00:08:57.840 --> 00:08:59.600] And you learn like how complex it is.
[00:08:59.640 --> 00:09:08.040] Econometrics is basically like that, but for economics, meaning if you take a basic economics class, you learn supply and demand are these two straight lines.
[00:09:08.040 --> 00:09:11.560] As you get into econometrics, you start to learn none of them are ever straight.
[00:09:11.560 --> 00:09:12.680] They're all over the place.
[00:09:12.680 --> 00:09:14.840] They backward bend, they do all crazy stuff.
[00:09:14.840 --> 00:09:16.360] So it's kind of like getting deeper.
[00:09:16.920 --> 00:09:20.360] A little tangent that four people.
[00:09:21.320 --> 00:09:22.520] Yeah, exactly.
[00:09:22.840 --> 00:09:26.360] And then, like, if you love that, you go get a PhD.
[00:09:27.000 --> 00:09:29.720] If you hated that, you don't.
[00:09:29.720 --> 00:09:34.760] And so I was going to go get a PhD, but then I was like, I don't know, I'm not that into it.
[00:09:35.320 --> 00:09:38.520] That's what led to working for the Intel community.
[00:09:38.520 --> 00:09:48.920] And then what brought me to Boston was I wasn't really enamored with like the bureaucracy of like the government, basically, even though it was one of the most fulfilling jobs.
[00:09:48.920 --> 00:09:54.760] And so Google, I thought, oh, a 30,000-person tech company, that'll be, that won't be bureaucratic at all.
[00:09:54.760 --> 00:09:57.000] And so, yeah.
[00:09:57.000 --> 00:09:59.480] And then after that, I jumped in the startup community, basically.
[00:09:59.480 --> 00:10:04.040] I worked at a venture-backed startup right before Profitwell.
[00:10:04.040 --> 00:10:04.520] Okay.
[00:10:04.760 --> 00:10:12.760] And so you start Profit Well, eventually, and officially, you've got Peter and Fukundo as your co-founders.
[00:10:12.760 --> 00:10:13.320] Yeah.
[00:10:14.200 --> 00:10:17.000] What does bootstrapped mean in this context?
[00:10:17.000 --> 00:10:19.320] Did you each put in a bunch of money?
[00:10:19.320 --> 00:10:21.880] Did you, were you very lean?
[00:10:22.680 --> 00:10:25.960] Like, what did that actually look like at the beginning?
[00:10:25.960 --> 00:10:29.080] Those guys, you know, thankfully have always been paid.
[00:10:29.320 --> 00:10:37.080] They didn't necessarily, so they didn't put in anything except probably not getting what they truly could get on the open market, if that makes sense.
[00:10:38.360 --> 00:10:48.400] For me, it was I cashed in, I had a small 401k, I think it was like 14 grand, like, cause I was pretty, I was in my mid-20s or early 20s still.
[00:10:49.200 --> 00:10:55.920] Cashed it out, giant tax, like there's a 40% tax on that, those dollars, something crazy, I can't even remember.
[00:10:55.920 --> 00:11:11.440] And then basically lived on that for like six months and told myself if I couldn't like get revenue or some sort of revenue within like six to nine months or like very clearly see a path towards it, I could always find a job.
[00:11:11.440 --> 00:11:16.320] And that was like a really big realization for me, especially coming from a very, like, I come from a very blue collar family.
[00:11:16.320 --> 00:11:21.920] Like the fact that I had left the government, let alone left Google, my parents thought I was insane.
[00:11:21.920 --> 00:11:25.120] And then like when I jumped out, they were like, what is going on?
[00:11:25.120 --> 00:11:29.840] And I internalized that and I was actually like, worst case scenario, I can go be a construction worker.
[00:11:29.840 --> 00:11:32.160] I could go work at a Starbucks, something like that.
[00:11:32.160 --> 00:11:33.360] Yeah, but that was kind of our first time.
[00:11:33.520 --> 00:11:37.840] Even though you could have probably gone back to the government or Google or somebody else.
[00:11:37.840 --> 00:11:38.480] Yeah, yeah.
[00:11:38.480 --> 00:11:41.840] But I had to put my mindset in like, I can always find a job.
[00:11:41.840 --> 00:11:46.320] It might not be a job I want, but I could feed myself, which, you know, was a big thing.
[00:11:46.560 --> 00:11:47.200] Yeah, yeah.
[00:11:47.200 --> 00:11:47.840] That's funny.
[00:11:47.840 --> 00:11:58.560] That's like the, I've had a version of this, which was a lot of founders will say, I could never, now I'm unemployable.
[00:11:58.560 --> 00:12:00.720] I could never go back to having a job.
[00:12:00.720 --> 00:12:01.360] Yeah.
[00:12:01.360 --> 00:12:04.240] And for a long time, I was like, what are you talking about?
[00:12:04.240 --> 00:12:08.480] Like, if I needed to feed my family, I would go work at a Starbucks.
[00:12:08.480 --> 00:12:09.520] I would do a double shift.
[00:12:09.520 --> 00:12:14.720] Like, of course, if you had to, you would go back to employment.
[00:12:14.720 --> 00:12:28.400] But there's a psychological trick there, which is, you know, if you can imagine yourself going back to Starbucks and going, well, that's the worst case scenario is me working at a Starbucks or whatever.
[00:12:28.800 --> 00:12:29.960] Wouldn't be awesome.
[00:12:29.960 --> 00:12:30.520] Yeah.
[00:12:29.600 --> 00:12:36.920] But, you know, there's, it's still like, there still be ways for you to make money.
[00:12:37.080 --> 00:12:44.600] And the truth is, is that, you know, most founders are actually more employable than they think they are, really.
[00:12:44.600 --> 00:12:45.240] Yeah.
[00:12:45.240 --> 00:12:47.320] It's a happiness thing, I think, too.
[00:12:47.560 --> 00:12:52.360] I think that's what people mean is that it's a happiness thing.
[00:12:52.680 --> 00:12:56.040] Although I think they also think they could just never have a boss.
[00:12:56.040 --> 00:12:56.520] Yeah, yeah, yeah.
[00:12:56.760 --> 00:12:58.360] And I'm like, well, I don't know.
[00:12:59.240 --> 00:13:01.240] I think you could.
[00:13:01.560 --> 00:13:03.240] The right boss, you definitely could.
[00:13:03.240 --> 00:13:06.600] Yeah, it's kind of the thing I worry about because I have a boss now, right?
[00:13:06.840 --> 00:13:21.080] What was really interesting about it is that I think if you're running your company properly and you're not like a, like you're trying to like grow, like you're trying to be a big company and you're running it properly, that's the caveat.
[00:13:21.080 --> 00:13:24.280] Because not everyone's trying to like grow really quickly or anything like that.
[00:13:24.280 --> 00:13:32.920] I think that you have to run your team as if the team is the boss, meaning like your exec team or your co-founders, your partners, whatever it is.
[00:13:32.920 --> 00:13:34.920] It's like that team of rivals concept.
[00:13:34.920 --> 00:13:40.040] Like Bob Iger, the Disney CEO for a long time, I think he talks a lot about this.
[00:13:40.040 --> 00:13:47.640] Like everyone at the company or everyone at the exec team, like what makes it great is theoretically each one of them could be CEO or could be a CEO, right?
[00:13:47.640 --> 00:13:51.000] And that's kind of how I really felt about Peter and Facundo.
[00:13:51.000 --> 00:13:53.960] And then when coming to Paddle, that was like a really big thing.
[00:13:53.960 --> 00:13:57.240] There's a lot of founders on the exec team, like a lot of founders.
[00:13:57.640 --> 00:14:02.120] And so part of that's great, but part of that's probably not great, depending on how you look at it.
[00:14:02.120 --> 00:14:13.960] But that's how the whole boss thing kind of like allowed me to kind of like be comfortable with that because it's very exec team, which is better than like a very top-down structure, if that makes sense.
[00:14:13.960 --> 00:14:14.760] Yeah, yeah.
[00:14:15.360 --> 00:14:32.960] This actually brings up a question I've always had about you and your company, which is, I think, somewhere I heard you talking about this decision you made whether you wanted to be a lifestyle company or a big ass company.
[00:14:32.960 --> 00:14:33.600] Yeah.
[00:14:33.600 --> 00:14:39.920] And you talked with the team and you wanted alignment around this idea that we want to go big.
[00:14:39.920 --> 00:14:40.400] Yeah.
[00:14:40.960 --> 00:14:42.640] Why did you want to go big?
[00:14:42.640 --> 00:14:46.560] What was it about going big that was motivating for you personally?
[00:14:46.560 --> 00:14:48.640] And what did, and what did going big mean?
[00:14:48.640 --> 00:14:51.360] Does going big mean capturing all the market?
[00:14:51.360 --> 00:14:54.560] Does going big mean having a big exit?
[00:14:54.560 --> 00:14:58.960] What was the discussion around that with you and the team?
[00:14:58.960 --> 00:15:05.040] The reason we had that discussion is because it's so crucial in how you make decisions.
[00:15:05.040 --> 00:15:08.080] And I think that we like to think that it's not.
[00:15:08.320 --> 00:15:10.320] Like we, the royal we, if you will.
[00:15:10.480 --> 00:15:16.160] We like to think that like, oh, like where you want to go as a company, it doesn't matter as much.
[00:15:16.160 --> 00:15:17.440] Just make decisions along the way.
[00:15:17.440 --> 00:15:27.600] But like the way you make decisions around sales, the way you make decisions around team structure, who you hire, all of these other things, like is very much predicated on like the type of company you want.
[00:15:27.600 --> 00:15:36.000] Like if you want, and I don't know what the other word for lifestyle, like lifestyle businesses, I don't think it should be a pejorative, but some people use it as a pejorative.
[00:15:36.320 --> 00:15:48.240] I think it's like, if you want a great business that like, you know, gets to an amazing lifestyle and that's kind of what you want, it's you're going to hire more contractors.
[00:15:48.240 --> 00:15:50.240] You're going to hire, you're going to hire less people, right?
[00:15:50.240 --> 00:15:53.520] If you want to create like a large company, like you're going to hire people, like you have to, right?
[00:15:53.520 --> 00:15:54.880] And you need leaders, right?
[00:15:54.880 --> 00:15:56.080] And those are expensive, right?
[00:15:56.560 --> 00:15:57.840] And that takes money out of the business.
[00:15:57.840 --> 00:16:08.680] And, you know, for us, it was, it was also around like, you know, I think the average amount I made over the past 10 years, like the average was $71,000 a year.
[00:16:09.640 --> 00:16:15.800] In more recent years, I was making my salary before the acquisition was $150,000 annually.
[00:16:15.800 --> 00:16:20.280] Which is quite low for, like, I was surprised when I saw that.
[00:16:20.440 --> 00:16:28.120] I saw you tweeting about your salary and I was like, wow, like, because you've built this big company, this big brand that is quite recognized.
[00:16:28.120 --> 00:16:38.360] And in some ways, that salary kind of structure was more similar to my friends who have been at funded startups, like the funded startups.
[00:16:38.360 --> 00:16:41.000] And the investors are like, hey, you got to grow.
[00:16:41.000 --> 00:16:42.520] Like, keep investing this back in.
[00:16:42.520 --> 00:16:45.000] Don't take too big of a salary, you know?
[00:16:45.320 --> 00:16:54.840] And a lot of successful bootstrap people I know who are, let's say, over the million dollar ARR mark, they pay themselves quite well.
[00:16:55.320 --> 00:17:00.440] Like 200s, 300s, 400s, even up to a million.
[00:17:00.440 --> 00:17:02.600] So I was surprised by that.
[00:17:02.600 --> 00:17:03.560] But that's the thing, right?
[00:17:03.560 --> 00:17:03.880] Yeah.
[00:17:03.880 --> 00:17:09.800] Because if we wanted to be a lifestyle business, and again, not pejorative, like that's what we were going to do.
[00:17:09.800 --> 00:17:12.920] We were going to be like, great, let's set, you know, let's do profit first.
[00:17:12.920 --> 00:17:14.760] Let's do distributions.
[00:17:14.760 --> 00:17:15.880] Let's do these types of things.
[00:17:15.880 --> 00:17:19.880] Like, but if we're trying to create a big ass company, it's like, that's not what we're going to do.
[00:17:19.880 --> 00:17:27.080] We're going to like, instead of like paying myself, you know, that extra 50 grand or something like that, we're going to hire a BDR.
[00:17:27.080 --> 00:17:27.720] You know what I mean?
[00:17:27.720 --> 00:17:28.520] Like that type of thing.
[00:17:28.520 --> 00:17:30.440] And there's a point where it's detrimental.
[00:17:30.440 --> 00:17:39.480] Like, I think that we probably should have increased the salary sooner because I do think it actually caused detrimental decisions.
[00:17:39.720 --> 00:17:46.400] But I think it's one of those things where that's, that's the reason we had to have that conversation because it affects so many decisions.
[00:17:46.720 --> 00:17:59.040] And I think on the, again, like where we stayed when we went to conferences, like the team, one of the biggest jokes was like going out of this transaction was Patrick is never going to book our travel again.
[00:17:59.040 --> 00:18:00.080] Thank God.
[00:18:00.080 --> 00:18:07.120] Because I would book travel and like, you know, I wouldn't book the Super 8, but I wasn't booking like the four seasons or anything by any means.
[00:18:07.120 --> 00:18:08.560] And it's not like Paddle's doing that either.
[00:18:08.560 --> 00:18:15.280] But it was like, I would book, like, if there was a Spirit Airlines and it was not a long flight, you were going on Spirit Airlines, right?
[00:18:15.280 --> 00:18:18.640] I was, but also me, like, I was going on Spirit Airlines too, right?
[00:18:18.640 --> 00:18:20.160] And so I think that was the big thing.
[00:18:20.160 --> 00:18:21.920] Now, now, why a big ass company?
[00:18:21.920 --> 00:18:23.760] Like, you're asking, you know, it's funny.
[00:18:23.760 --> 00:18:34.240] Like, I, Josh, Barometrics Josh tweeted, you know, the other day about how, like, Josh and I are very similar in so many different ways.
[00:18:34.240 --> 00:18:37.120] When he tweeted about his Glowforge, I was like, I have a Glowforge.
[00:18:37.120 --> 00:18:38.240] Like, there's a lot of these little things.
[00:18:38.240 --> 00:18:39.200] Like, he likes the West Wing.
[00:18:39.200 --> 00:18:39.840] I like the Westwing.
[00:18:39.920 --> 00:18:41.120] Like, there's a lot of these things.
[00:18:41.120 --> 00:18:44.800] We're also just like, you know, white guys of the same age, basically.
[00:18:44.800 --> 00:18:46.960] So I think that drives a lot of it as well.
[00:18:47.120 --> 00:18:54.080] But one of the things that he tweeted that I'm just like so the opposite of, not in a judgmental way, it's just like he has a lot of side projects.
[00:18:54.080 --> 00:18:55.200] He has a lot of like things.
[00:18:55.200 --> 00:18:56.640] He likes to start things.
[00:18:56.640 --> 00:19:02.960] I think he learned that, you know, he needs to treat his main thing like a main thing, you know, based on his tweets.
[00:19:02.960 --> 00:19:06.880] But for me, I can't, I can't, I can't do that.
[00:19:06.880 --> 00:19:08.160] Like I'm all in.
[00:19:08.160 --> 00:19:09.200] Like I'm all in.
[00:19:09.200 --> 00:19:18.160] And I think it, I don't think it's healthy always, but I'm like all in to the point where like I can't have like a side hustle.
[00:19:18.160 --> 00:19:19.840] I can't have some of these things.
[00:19:19.840 --> 00:19:22.160] I need to like go, go, go, go, go at one thing.
[00:19:22.160 --> 00:19:27.200] And maybe I learned to kind of like relax a little bit, but I'm very much like a singular focus.
[00:19:27.200 --> 00:19:36.760] And so, yeah, I didn't necessarily want a lifestyle business because I think a lifestyle business, it's not that there's people listening to this where it's like, it is all in and it's a lifestyle business still.
[00:19:29.920 --> 00:19:37.240] And that's fine.
[00:19:37.400 --> 00:19:38.440] I'm not saying that.
[00:19:38.440 --> 00:19:47.000] What I'm saying is, is like, if we got to a certain point, eight figures in revenue and I'm treating it like a lifestyle business, like it's, I think that'd be really hard for me.
[00:19:47.320 --> 00:19:50.200] And thankfully, the guys are similar thinking.
[00:19:50.200 --> 00:19:52.280] And so it was more of an all-in.
[00:19:52.280 --> 00:19:57.080] And I also like believe, and this is not a judgmental statement, this is a very personal statement.
[00:19:57.080 --> 00:20:06.360] Someone described it as like, like, there's almost this like David Goggins nature of SAS, like how I approach things in the sense of the struggle.
[00:20:06.360 --> 00:20:10.440] Like, I'm very much like, if it's not a hard thing, then why are we doing it?
[00:20:10.440 --> 00:20:10.680] Right.
[00:20:10.680 --> 00:20:13.400] Like, if it's not hard, that's the purpose.
[00:20:13.400 --> 00:20:16.600] Like, that's why we're on this earth is to like do hard things and grow, right?
[00:20:16.600 --> 00:20:22.120] Which is, you know, the David Goggins thing is almost like, I think he's a masochist with some of these things.
[00:20:22.120 --> 00:20:31.160] I'm not quite on that level, but it's more of like, I think that there's this, this, this view I have of like trying to do something hard because it's worthy of doing it.
[00:20:31.560 --> 00:20:33.560] That's kind of where my values sit, if that makes sense.
[00:20:33.560 --> 00:20:36.200] So it's a very personal decision, I guess, the way I'm trying to say it.
[00:20:36.200 --> 00:20:36.600] Yeah.
[00:20:36.600 --> 00:20:39.960] And I mean, some folks, it's just unavoidable.
[00:20:39.960 --> 00:20:46.440] The fact that Barometrics sold for 4 million and you've sold for 200 million.
[00:20:46.440 --> 00:20:49.320] Now, that must be a mixture of stock and cash, right?
[00:20:49.320 --> 00:20:50.680] That's not all cash, is it?
[00:20:50.920 --> 00:20:51.560] It's a mix.
[00:20:51.560 --> 00:20:52.120] Yeah, yeah.
[00:20:52.360 --> 00:20:53.720] I don't think Paddles even raised.
[00:20:53.880 --> 00:20:56.920] Paddles raised maybe just under 300 million or something.
[00:20:56.920 --> 00:20:57.240] Yep.
[00:20:57.320 --> 00:21:02.680] So yeah, there's no way they would have given, paid out 200 million in cash.
[00:21:04.120 --> 00:21:05.840] That's most of their stores.
[00:21:05.840 --> 00:21:07.480] They're in their bank account.
[00:21:07.480 --> 00:21:08.040] Yeah.
[00:21:08.360 --> 00:21:12.120] Okay, so you've got a mix of stock and cash.
[00:21:12.440 --> 00:21:19.600] But still, the exit is people have been saying, like, wow, this is a 50 times exit.
[00:21:20.480 --> 00:21:26.320] And some people have, you know, Josh himself is like, well, here's why I think that happened.
[00:21:26.320 --> 00:21:30.720] And he said, well, maybe it's because I treated barometrics too much like a side project.
[00:21:31.120 --> 00:21:32.480] And there were some other things too.
[00:21:32.800 --> 00:21:34.320] He got locked into Stripe.
[00:21:34.320 --> 00:21:35.040] Yep.
[00:21:35.040 --> 00:21:37.280] And he was not freemium.
[00:21:37.280 --> 00:21:38.320] You were freemium.
[00:21:38.320 --> 00:22:47.320] Do you think that part of your, and in some ways I'm asking this selfishly too, because another comment has been around the acquisition of Profit Well has been it's better to try to go out and own the market right to try to become the dominant player and you know you guys were clear that you wanted to be a big ass company was that part of being a big ass company was that you really wanted to own as much of the market as you could was that strategic and is the strategy there like once you own the market then you just have so much more leverage or like what was some of your thinking around that or was it simply the challenge like let's just see how much of this this nascent category can we develop and then you know become dominant in yeah i think there's a couple things i think that so for one i do think josh is right in his analysis on a couple of things like you have it's you have someone treating it like a side project and then you have me, who's insane?
[00:22:47.280 --> 00:22:54.120] Like, you know, like in terms of like focus, like assuming the same intelligence, like one will win, right?
[00:22:54.120 --> 00:22:55.880] And without luck and stuff like that, right?
[00:22:55.880 --> 00:22:57.800] So I think that that's, that's really tough.
[00:22:57.800 --> 00:22:59.240] And I think that that's helped him.
[00:22:59.240 --> 00:23:01.320] And I'm, I'm an investor in his next thing, maybe.
[00:23:01.320 --> 00:23:04.360] And so I think that, like, I think that's a really good lesson for him.
[00:23:04.360 --> 00:23:11.800] And I think it's, it's a hard one because think of the introspection that he has to have to like look at that, which is so hard, right?
[00:23:12.120 --> 00:23:21.640] And I think that the other thing is like the lockup with Stripe, I think it points to an interesting situation because some of these markets are not big enough.
[00:23:21.640 --> 00:23:23.000] Like they seem big.
[00:23:23.000 --> 00:23:24.680] Oh, subscription companies everywhere.
[00:23:24.680 --> 00:23:29.080] It's like there are 150,000 max subscription companies in the world.
[00:23:29.080 --> 00:23:30.440] That includes subscription media.
[00:23:30.440 --> 00:23:35.880] It includes subscription memberships, subscription SaaS, subscription consumer, enterprise subscription.
[00:23:35.880 --> 00:23:37.240] There's 150,000 max.
[00:23:37.240 --> 00:23:44.360] Like we're not talking about e-commerce startups where there's like millions of stores and millions are coming on board like every couple of years.
[00:23:44.360 --> 00:23:44.840] Right.
[00:23:45.160 --> 00:24:01.240] And so what we did is we looked at that, we looked at all the competition and we basically said, okay, like analytics products inherently kind of suck to build because no one appreciates the work that went into them and they're not willing to pay anything for them.
[00:24:01.240 --> 00:24:04.760] Like we did our pricing research on metrics because we were going to charge for it.
[00:24:04.760 --> 00:24:07.240] Like it was originally going to be a paid product.
[00:24:07.240 --> 00:24:14.600] And in all this context, we said we have to go up market, which that means hiring a lot of people and being a funded company.
[00:24:15.400 --> 00:24:20.520] Or we have to do free, which probably should have meant we raise money.
[00:24:20.520 --> 00:24:24.440] Like we probably should, because we thought, oh, how hard could accuracy be?
[00:24:24.440 --> 00:24:27.000] You know, which was famous last words, right?
[00:24:27.000 --> 00:24:31.160] So I think like that's what guided the decision to go free.
[00:24:31.480 --> 00:24:36.360] And then the thesis became, we really like this concept of do-it-for-you.
[00:24:36.360 --> 00:24:39.000] So, retain, the beauty of retain is that we do it for you.
[00:24:39.000 --> 00:24:40.760] You plug it in and it's done.
[00:24:40.760 --> 00:24:41.960] You don't have to write emails.
[00:24:41.960 --> 00:24:54.400] You don't have to, and it's not because, like, we don't want it, it is kind of because we don't want your input, like, it's because we're studying everything, and because we have all this data, we can understand exactly what's good or bad, and then we do it for you.
[00:24:54.400 --> 00:24:59.760] And you just don't want to become an expert in credit cards, you want to just understand, like, great, it's fixed, right?
[00:24:59.760 --> 00:25:05.280] I made more money this month than I should have because, or than I was going to, because profit will fix it with retain.
[00:25:05.280 --> 00:25:11.840] And that's where the data move, like it wasn't a network effect of users and customers, that's what a lot of people think.
[00:25:11.840 --> 00:25:13.120] Like, oh, they get upgrade pass.
[00:25:13.120 --> 00:25:23.760] Like, we certainly get that, and the brand really helped, but it was a network effect with the data when we were able to study that data and input that into products so we could build products that do it for you, like lowered your churn automatically.
[00:25:23.760 --> 00:25:34.640] And so, I think the mindset, it was just a mindset and a focus where it's hard to sell a product that's underappreciated just in general, like metrics in general.
[00:25:34.640 --> 00:25:47.760] It's hard to sell that in a market where there is a viable, free alternative, where even if you like, you didn't really like the design as much because people love Josh's design, or maybe Turt Mogul had a couple extra features than we did.
[00:25:47.760 --> 00:25:57.200] Like, it's really hard to compete with it unless you know your product like is 10x better and there wasn't going to be a 10x better product in the market because we were going to keep moving.
[00:25:57.200 --> 00:26:00.800] And I just don't think there can be a 10x better product in analytics in general.
[00:26:00.800 --> 00:26:21.520] Yeah, and then there was also the risk, uh, which ended up coming true, which is you know, Stripe added analytics, uh, even PayPal added analytics, and recurly and other, it wasn't like this category was completely new, like recurly and other products had um some of these analytics before.
[00:26:22.080 --> 00:26:38.280] Your comment about the market being small is so interesting because this gets back to something, I mean, people are tired of me talking about this, but the characteristics of a market, the size, the shape, and the dynamics.
[00:26:38.280 --> 00:26:40.280] And so maybe we could get into this a little bit.
[00:26:40.280 --> 00:26:42.440] So you said $150,000.
[00:26:44.280 --> 00:26:52.280] And so, you know, let's say, you know, $99 a month, if that's where you start, I think that's where Chart Mogul starts.
[00:26:52.280 --> 00:26:59.320] And then, you know, if you captured 20,000 of that 150,000, which was that's a fair chunk.
[00:26:59.320 --> 00:26:59.880] Yeah.
[00:27:00.600 --> 00:27:03.160] You know, that's $2 million a month or whatever.
[00:27:03.480 --> 00:27:08.040] Not a bad business, but, and we don't know what Chart Mogul's metrics are.
[00:27:08.040 --> 00:27:09.240] Do you have any idea of size?
[00:27:09.240 --> 00:27:17.720] And like, if you guys were out to own the market, was Profit Well number one by a large margin, or did Chart Mogul have a significant portion as well?
[00:27:17.720 --> 00:27:24.760] We have 30,000 subscription companies on Profit Well to now more than 30,000.
[00:27:24.760 --> 00:27:28.680] And then ChartMogle has one to 2,000.
[00:27:28.680 --> 00:27:31.640] Farmetrics had about 1,000, might be a little bit more.
[00:27:31.640 --> 00:27:42.840] But yeah, so I think the other thing to point out here that you kind of brought up is the physics of a market guides so many things.
[00:27:42.840 --> 00:27:44.120] Like, yes.
[00:27:44.120 --> 00:27:54.920] And a lot of people don't realize, like, even if, let's say, we just wanted to be a lifestyle business, we wanted a great business that guided, you know, all of our lives, made us all very wealthy.
[00:27:54.920 --> 00:27:58.040] Everyone was like, you know, had really great profit from the entire company.
[00:27:58.040 --> 00:28:00.040] We were a great company to work for, et cetera.
[00:28:00.600 --> 00:28:05.000] 20,000 customers paying $100 a month.
[00:28:05.000 --> 00:28:06.840] Oh my God, what a grind.
[00:28:06.840 --> 00:28:07.240] Right.
[00:28:07.560 --> 00:28:12.040] And I can tell you right now, for most of the market, $100 a month is too expensive.
[00:28:12.040 --> 00:28:13.680] Like, it's insane.
[00:28:13.680 --> 00:28:14.160] Right.
[00:28:14.120 --> 00:28:22.640] And so, what we basically, like, honestly, the worst thing, like, the thing we got wrong was the market.
[00:28:22.960 --> 00:28:24.480] Like, that's the thing we got right.
[00:28:24.480 --> 00:28:25.200] Like, it worked out.
[00:28:25.200 --> 00:28:33.120] So I'm not complaining, but like we knew, like, as we started getting into like, we're trying to be a big company, like, we knew our TAM was not big enough.
[00:28:33.120 --> 00:28:46.960] Like, our TAM, the way we monetize, and even though we were monetizing our leads better than anyone else in the space, because with retain, someone who wasn't willing to pay $50 a month for metrics is willing to pay $300 a month because it's purely pay for performance, right?
[00:28:46.960 --> 00:28:51.600] So they're like, I wouldn't have had this money, and you're not, you're only taking, you know, a portion of the money I would have gained.
[00:28:51.600 --> 00:28:54.080] And I get to keep all the, all the money later, right?
[00:28:54.080 --> 00:29:04.080] So it's one of those things, like, even though we were squeezing more out of this, this lemon than anyone else, it was one of those things that, like, that's where this multi-product concept came to be.
[00:29:04.080 --> 00:29:14.880] And also, why, like, it was kind of appealing to sell too, because the billing systems just have an ability to monetize even better than anyone else because they can monetize the throughput, right?
[00:29:15.200 --> 00:29:20.640] And so, yeah, there's a lot we can do with that with like retain as well as some of the other products we're building.
[00:29:20.640 --> 00:29:36.560] But the advice to anyone else listening is like, don't underestimate the velocity of your market because even if you're building something that like is in a super competitive space, especially if you're building something in a competitive space, if the market's big enough, that's fine.
[00:29:36.560 --> 00:29:40.000] Like, you can make a great, like, again, lifestyle business.
[00:29:40.000 --> 00:29:48.680] But if you're in a market that is squeezed and it has competition, like go into another market.
[00:29:48.400 --> 00:29:49.640] Yeah.
[00:29:48.640 --> 00:29:51.680] Um, yeah, unless you're really just glutton for punishment.
[00:29:51.680 --> 00:29:52.800] Can we get into this a bit more?
[00:29:52.800 --> 00:29:59.280] Because I, it feels like this is the area that that gets misunderstood a lot.
[00:29:59.280 --> 00:30:06.520] And so you said TAM, which is total addressable market.
[00:30:06.520 --> 00:30:07.480] That's right.
[00:30:07.480 --> 00:30:13.880] And so that's the idea there is how many companies are in this market total, right?
[00:30:13.880 --> 00:30:15.480] Essentially, yeah, yeah, yeah.
[00:30:15.480 --> 00:30:17.160] It's you can define it a little bit differently.
[00:30:17.400 --> 00:30:18.760] How many participants or?
[00:30:18.760 --> 00:30:26.040] Well, so there's a little bit like it's like all metrics, like you can kind of fudge with the definition depending on what you're trying to do, right?
[00:30:26.360 --> 00:30:29.800] So there's 150,000 subscription companies.
[00:30:29.800 --> 00:30:38.360] Maybe that's our total addressable market, but like our realistic addressable market, there's other acronyms people use.
[00:30:38.360 --> 00:30:51.800] It's like, I can tell you out of those 150,000, 75,000 are just not addressable for us because they're enterprise companies, they're too big, they're, you know, they don't fit our billing systems we support.
[00:30:52.680 --> 00:30:53.480] Yeah, totally.
[00:30:53.480 --> 00:30:55.320] Like all over the place, right?
[00:30:55.320 --> 00:31:11.080] And so it's, it's more about like, I think in an investor pitch or just in an adventure-backed company or trying to be a big company, you want a very large TAM because that means that the future, like if I just capture X percent of the TAM, right?
[00:31:11.800 --> 00:31:20.600] I think in a bootstrap company or a lifestyle business, you don't necessarily have to worry about, oh my God, I have to pitch something that has a huge addressable market.
[00:31:20.600 --> 00:31:35.240] But if you have a very large addressable market, it's probably an indication of like the ease of your go-to-market strategy because everyone already has one of these things and I'm just going to sell a different one, you know, that type of a thing.
[00:31:35.480 --> 00:31:36.840] I'm trying to invent a market.
[00:31:37.320 --> 00:31:39.960] And you also talk about the velocity.
[00:31:40.280 --> 00:31:46.720] So what do you mean by velocity when you're when you're when you use that as a descriptor or the physics of a market?
[00:31:44.920 --> 00:31:48.000] What are you talking about there?
[00:31:48.320 --> 00:31:52.800] It's the number of logos in the market, like number of potential buyers.
[00:31:52.800 --> 00:31:54.880] And again, it's not like...
[00:31:54.880 --> 00:32:00.400] Like if we're selling into subscription companies, it's not every subscription company or if it's like we're selling a consumer product.
[00:32:00.400 --> 00:32:01.680] It's not every consumer.
[00:32:01.680 --> 00:32:03.840] It's people who fit some sort of a segment.
[00:32:03.840 --> 00:32:06.240] That's our addressable market theoretically.
[00:32:07.120 --> 00:32:15.600] And the bigger that segment is, just the number of humans that theoretically would go to your landing page is just increased.
[00:32:15.600 --> 00:32:19.040] And the number of humans you're able to like market to, right?
[00:32:19.040 --> 00:32:28.240] So the reason our strategy for marketing is what it is, is not because Patrick has a big ego and really likes to do podcasts.
[00:32:28.240 --> 00:32:31.360] The reason it is, is because we need a brand.
[00:32:31.360 --> 00:32:33.040] We need people to know who we are.
[00:32:33.040 --> 00:32:35.760] And you don't get that through paid media.
[00:32:35.760 --> 00:32:37.040] You get that through content.
[00:32:37.040 --> 00:32:38.800] You get that through community.
[00:32:38.800 --> 00:32:39.760] You get that through events.
[00:32:39.760 --> 00:32:41.200] You get that through those types of things.
[00:32:41.200 --> 00:32:51.920] So that when you're talking to someone, Justin, about, hey, I need metrics for my subscription business, you go, well, you know, there's a couple, but I know Profile's free, right?
[00:32:51.920 --> 00:32:56.960] And so, you know, when Patrick is on the podcast and like, you should check it out, but also check out bare metrics and whatever.
[00:32:56.960 --> 00:32:58.160] And then that's all I need.
[00:32:58.160 --> 00:33:02.720] I just need you to refer to it because when they get into the product, they're going to compare and contrast it.
[00:33:02.720 --> 00:33:06.880] And the product is good enough, if not better in certain ways, that they're going to stay.
[00:33:06.880 --> 00:33:07.280] Right.
[00:33:07.280 --> 00:33:16.400] And so that's, that's what I mean: is like, if you are selling to like a fitness product, your TAM is huge because there's so many people are trying to get healthy.
[00:33:16.400 --> 00:33:21.680] And you can drive that through paid and through, you know, display ads and all these other things.
[00:33:21.680 --> 00:33:22.640] You don't really need a brand.
[00:33:22.640 --> 00:33:26.080] You don't really need content unless you're doing an SEO play in that case.
[00:33:26.080 --> 00:33:32.360] And so, that's what I mean by the physics: is like how many people can you get through in a very quick manner into your funnel, basically.
[00:33:29.840 --> 00:33:34.120] And how important do you feel?
[00:33:34.280 --> 00:33:42.520] The because even in your example, the physics there are that some people are already in motion.
[00:33:42.520 --> 00:33:43.000] Yep.
[00:33:43.320 --> 00:33:56.680] And so, I have this feeling like most of the success of a market of a product in a category has to depend on how many people are already in motion.
[00:33:56.680 --> 00:34:05.800] And it feels like many founders feel like you can motivate people who are not in motion to buy the product.
[00:34:05.800 --> 00:34:07.400] So, what's your take on that?
[00:34:07.400 --> 00:34:15.560] Because, in your example, there's two people in Slack, and somebody is looking for SaaS metrics, which means they're already in motion.
[00:34:15.560 --> 00:34:17.320] They already have a company.
[00:34:17.320 --> 00:34:24.280] They already like think of all the things they have to do to just get to the starting line of profit well, right?
[00:34:24.280 --> 00:34:25.720] So, what's your take on that?
[00:34:25.720 --> 00:34:28.200] Another huge mistake from us.
[00:34:28.200 --> 00:34:29.400] Again, huge mistake.
[00:34:29.560 --> 00:34:30.760] I'm not trying to be a jerk.
[00:34:30.760 --> 00:34:36.200] It's just like these are things that I know, like if we had adjusted our thinking, we could have done better.
[00:34:36.200 --> 00:34:49.400] Right now, in like the average subscription or SaaS company, depending on how you want to slice it, the median expenses that go to sales and marketing is 60%.
[00:34:49.400 --> 00:34:50.120] 60%.
[00:34:50.120 --> 00:34:59.000] So, if I take 1,200 companies, I think the study was, I add up every dollar they're spending on everything, toilet paper, ads, everything in between, right?
[00:34:59.640 --> 00:35:03.800] And 60% of those dollars are going to sales and marketing.
[00:35:03.800 --> 00:35:09.320] Now, you throw in operations, you throw in like the desks and everything like that.
[00:35:09.320 --> 00:35:14.920] How much money do you think is left over for retention and pricing, which are two paid products?
[00:35:15.600 --> 00:35:16.640] There's not a lot.
[00:35:16.640 --> 00:35:17.120] Yes.
[00:35:17.120 --> 00:35:24.240] And so we're literally like, we spent 10 years yelling about pricing and yelling about retention.
[00:35:24.240 --> 00:35:36.400] And people get it, like people find it important, but like we're constantly educating and we're fighting this inertia of, yes, there's five, there's 15,000 different sales and marketing pieces of software, right?
[00:35:36.400 --> 00:35:38.960] So there's a huge, hugely different problem there.
[00:35:38.960 --> 00:35:40.080] But that's another thing, right?
[00:35:40.080 --> 00:35:40.320] Yeah.
[00:35:40.320 --> 00:35:48.640] Like we're not selling something, like it's rare that someone like is looking for like dunning or credit card failure software, right?
[00:35:48.640 --> 00:35:52.320] And we try to own those places, obviously, but it's a lot of education.
[00:35:52.320 --> 00:35:57.120] And I think that you're better off finding people in motion with something.
[00:35:57.120 --> 00:36:04.400] So if I was just trying to like create, oh, I'm going to work on something for six months and I want to get it to 100 grand a year and like revenue, right?
[00:36:04.560 --> 00:36:10.400] I would focus on things where people are already in motion, huge TAM, meaning lots of people.
[00:36:10.400 --> 00:36:12.160] We don't always build these things for money.
[00:36:12.160 --> 00:36:15.200] I actually love like the SaaS and subscription community like a lot.
[00:36:15.200 --> 00:36:18.480] Like I've, I've, you know, and so it's one of those things where like, it's not all about the money.
[00:36:18.480 --> 00:36:22.720] It's not all about the TAM, but it's like, if I wanted to make it easy, those are the things that I would look for.
[00:36:22.720 --> 00:36:25.280] And then the third piece is lock-in.
[00:36:25.280 --> 00:36:27.680] I would try to build a product that had lock-in.
[00:36:27.680 --> 00:36:31.760] Like, what's amazing about billing systems, there's so much lock-in.
[00:36:32.080 --> 00:36:39.200] Like people, like, they install it and they're like, there's only a couple points in their history that they want to change it or are thinking of changing it.
[00:36:39.200 --> 00:36:45.120] And that's a whole new problem for Paddle now that I'm discovering at Paddle.
[00:36:45.120 --> 00:36:49.520] But it's also the brilliance of like the Stripe Atlas program.
[00:36:49.520 --> 00:36:50.760] Like the brilliance of the Stripe Atlas.
[00:36:50.880 --> 00:36:55.200] I always thought, oh, that's just them being nice and like, you know, giving back to the community.
[00:36:55.200 --> 00:37:02.520] And part of it is, but another part of that program is once you got that Stripe account, like, why would you like do anything else?
[00:36:59.760 --> 00:37:02.680] Right.
[00:37:02.840 --> 00:37:07.720] And then normally we see people who reach like $700,000 a year to about a million a year.
[00:37:07.720 --> 00:37:11.960] That's the next, like then they're looking at Charge B, Recurly, Paddle, et cetera.
[00:37:11.960 --> 00:37:18.360] But yeah, lock-in, if you can get lock-in, is the third thing I would look for, but it's not as crucial as the first two.
[00:37:18.760 --> 00:37:19.880] Yeah, the physics.
[00:37:19.880 --> 00:37:22.920] I love that idea, that metaphor of the physics.
[00:37:23.560 --> 00:37:26.680] Hey, how come your team doesn't have their own podcast?
[00:37:26.680 --> 00:37:31.560] Head over to Transistor and use my coupon, transistor.fm slash justin.
[00:37:31.560 --> 00:37:35.640] You'll get 15% off your first year of podcast hosting.
[00:37:36.280 --> 00:37:47.080] Because I'm trying to describe so many of the metaphors we use in startups, but especially in bootstrap startups, are incredibly two-dimensional.
[00:37:47.080 --> 00:37:51.080] And so there's this idea of like this binary of charge more.
[00:37:51.080 --> 00:37:56.840] And I've always been saying, no, there's way more nuance in pricing strategy.
[00:37:56.840 --> 00:38:04.840] Like when I actually read academic papers on pricing, there's a ton of math that I do not understand with super tons of variables.
[00:38:04.840 --> 00:38:13.000] And even if you wanted to, if you're a dumbass like me and you wanted to look at the price, like, should I charge more or should I not?
[00:38:13.320 --> 00:38:15.160] There's a lot of places I'd have to look.
[00:38:15.160 --> 00:38:20.040] Like, how is pricing anchored by the existing competition?
[00:38:20.040 --> 00:38:36.120] Because if MailChimp is charging $49 per month for whatever, a thousand subscribers, ConvertKit can't come in and charge $2,000 unless there's something significantly different.
[00:38:36.120 --> 00:38:42.840] And, you know, Nathan's always anchored his pricing, I think, within 10% of MailChimp for that reason.
[00:38:42.840 --> 00:38:46.320] It's like, you can't be too much higher, right?
[00:38:46.320 --> 00:38:59.040] You know, what's funny is like, I think your statement of like the binary nature of a lot of advice is like something that we all need to learn sooner than later in our trajectories, right?
[00:38:59.040 --> 00:39:00.080] Like you and I are baked.
[00:39:00.080 --> 00:39:08.800] Like we're, we're like, you know, thankfully we learned it, but I think like teaching that to some of, you know, if you're early in your trajectory, like learning that is so important.
[00:39:08.960 --> 00:39:19.360] It gets me, it grinds my gears about some of the Twitter bullshit that you see, like the advice and stuff, because it's like, it's the equivalent of like, drink eight water, eight glasses of water a day, stay hydrated, guys.
[00:39:19.360 --> 00:39:21.360] Like, and it's like, yeah, but it's really nuanced.
[00:39:21.360 --> 00:39:22.560] Like, I'm a large human.
[00:39:22.560 --> 00:39:25.040] I need more water, you know, like I, you eat a lot of salt.
[00:39:25.040 --> 00:39:25.920] I don't know if that's true or not.
[00:39:25.920 --> 00:39:26.560] You need more.
[00:39:26.560 --> 00:39:33.280] Like, and I think it's like, yeah, a lot of this advice is like pithy baloney, but all advice is more nuanced.
[00:39:33.280 --> 00:39:34.160] It depends.
[00:39:34.160 --> 00:39:39.360] Like, I think freemium is the future, but should every company use freemium?
[00:39:39.360 --> 00:39:40.400] Of course not, right?
[00:39:40.400 --> 00:39:41.280] Like, of course not.
[00:39:41.280 --> 00:39:52.400] Like, maybe in some way over the next decade, but that's, that's a big thing for everyone to latch on to is like you have to take in the advice and then filter it through a framework for your business.
[00:39:52.640 --> 00:39:54.480] And I think not enough of us do that.
[00:39:54.480 --> 00:40:15.920] And understanding that, again, the idea of the physics of a market, I just love that idea because the podcast market, podcast hosting market, has similar physics to web hosting, but different in some notable ways.
[00:40:15.920 --> 00:40:18.640] But we are most like web hosting.
[00:40:18.640 --> 00:40:29.200] So when Ruben Gamez was giving me advice early on, he said, if I was you, I would look at web hosting because they're two decades ahead of podcast hosting.
[00:40:29.200 --> 00:40:34.200] And likely what worked there, the dynamics that work there, are also going to apply.
[00:40:34.200 --> 00:40:36.840] And so for example, affiliates.
[00:40:36.840 --> 00:40:41.080] Affiliates is big, and it was big.
[00:40:41.400 --> 00:40:56.360] Now, the dynamics of the podcast, and he was also clear to say, and we knew this from the beginning, like the paid podcast hosting market is maybe 100,000, 200,000, something like that.
[00:40:56.360 --> 00:41:05.320] And with a much lower average revenue per user than, you know, we're high at our entry level, and our entry level is 19.
[00:41:05.320 --> 00:41:05.720] Yeah.
[00:41:06.040 --> 00:41:08.520] Libson's entry level is 5.
[00:41:08.840 --> 00:41:17.160] And so we knew that the physics of our market are defined by those boundaries.
[00:41:18.120 --> 00:41:27.080] And no matter how much I wish, like I could wish and wish and wish that this will be a billion-dollar company, there's just no way it's happening.
[00:41:27.960 --> 00:41:32.600] The dynamics in this market are, it's impossible.
[00:41:32.600 --> 00:41:36.600] It's impossible the way it is right now for this to be a billion-dollar company.
[00:41:36.600 --> 00:41:38.840] Now, the physics change all the time.
[00:41:38.840 --> 00:41:44.680] Like we found with Anchor, there's a worry with Anchor.
[00:41:44.680 --> 00:41:55.640] Anchor has ended up being an incredible lead gen for Transistor in the same way that Substacks free email newsletter has been unbelievable for Nathan and ConvertKit.
[00:41:56.280 --> 00:41:58.920] So all of a sudden, the physics change.
[00:41:58.920 --> 00:42:05.520] Now instead of 500,000 podcasts in the world, some of which are free on free hosting or whatever.
[00:42:05.160 --> 00:42:10.840] Now, now there's, in a matter of years, there's two and a half million or four million or something like that.
[00:42:10.840 --> 00:42:12.120] And what does that mean?
[00:42:12.120 --> 00:42:13.720] You know, the physics change.
[00:42:13.720 --> 00:42:32.960] At the same time, you know, even with two and a half million podcasts in the ecosystem, if you asked me to place a bet on whether any of us were going to be a billion-dollar company even in 10 years, I would say, no, I wouldn't make that bet.
[00:42:32.960 --> 00:42:41.040] Now, would I make a bet that Paddle could be a $10 billion company in 10 years?
[00:42:41.040 --> 00:42:45.280] I might make that bet because the dynamics of that market are so much different.
[00:42:46.560 --> 00:42:58.800] In terms of physics, never underestimate the entrant of a competitor on what it, like, competitors entering your market historically make the market better.
[00:42:58.800 --> 00:43:01.680] Like, it's, you're always scared.
[00:43:01.680 --> 00:43:16.320] And one of the things we would always say is, like, again, nothing against our competitors, but like, we haven't thought of them that much in the past couple of years because like, you know, 30,000, you know, then 20,000 or 25,000 versus one to two.
[00:43:16.320 --> 00:43:18.000] And they're monetizing differently.
[00:43:18.000 --> 00:43:20.800] Our monetizable products are growing pretty rapidly.
[00:43:20.800 --> 00:43:25.680] But like, it was one of those things where we were like, we need a really big competitor.
[00:43:25.680 --> 00:43:32.080] We need a big one, like a serious big one, because that trains the market in a way that you can't.
[00:43:32.080 --> 00:43:41.520] Like, I can't train the market fast enough as Stripe's metrics actually being like Stripe's metrics are not, I'll say it, like, I love those Stripe.
[00:43:41.600 --> 00:43:42.080] They're not great.
[00:43:42.080 --> 00:43:42.720] They're not great.
[00:43:42.720 --> 00:43:43.920] Like, they're inaccurate.
[00:43:43.920 --> 00:43:47.600] Like, they make some very obvious accuracy issues, but it is the bare minimum.
[00:43:47.600 --> 00:43:49.360] They needed the bare minimum.
[00:43:49.360 --> 00:43:53.680] And like, it's just one of those things that wasn't like amazing.
[00:43:53.680 --> 00:43:58.080] And so it was one of those things that, like, it would be cool if like HubSpot got into the space, right?
[00:43:58.080 --> 00:44:01.800] Now I say that, and then they get in the space and they have all the money, and we're like, oh my God, right?
[00:44:01.800 --> 00:44:06.040] But like, that's one of the things that when you have competitors enter the market, it changes.
[00:44:06.040 --> 00:44:07.240] The market changes.
[00:44:07.640 --> 00:44:16.120] The throughput is like now higher because all of a sudden that SEO you've built, people are starting to search for it more, or your ads are getting more traffic, or like those types of things.
[00:44:16.120 --> 00:44:29.720] Now, I will say though, that like in the podcast hosting space, like one question that's useful: if you want to build a big company, or even if you're just a bootstrap company, you're thinking like, hey, I want to, you know, I want to just be bigger.
[00:44:29.720 --> 00:44:34.200] What would it take my market to have a billion-dollar exit?
[00:44:34.200 --> 00:44:36.120] Whether it's me or someone else, right?
[00:44:36.120 --> 00:44:37.160] That's a big thing.
[00:44:37.160 --> 00:44:41.960] And that's what guided us a little bit in the free conversations because we knew it wasn't going to come from metrics.
[00:44:41.960 --> 00:44:43.480] And we knew like, well, what would it take?
[00:44:43.480 --> 00:44:46.280] Well, we'd have to solve these six problems and blah, blah, blah.
[00:44:46.440 --> 00:44:49.000] And that started as we're guiding where product basically went.
[00:44:49.000 --> 00:44:50.600] But it's a good thought exercise.
[00:44:50.600 --> 00:44:52.600] How much do you think?
[00:44:52.600 --> 00:45:00.280] I mean, again, the dynamics of every market are different and could change literally one week to the next overnight.
[00:45:00.280 --> 00:45:04.840] And, you know, founders, I think we think in bets.
[00:45:04.840 --> 00:45:11.480] The question for me is like, for example, should Transistor try to go out and own the market?
[00:45:11.480 --> 00:45:18.600] Like right now, we have maybe 1.5% of the paid podcast hosting market.
[00:45:18.600 --> 00:45:19.640] That's my guess.
[00:45:19.640 --> 00:45:20.360] Sure.
[00:45:20.360 --> 00:45:23.400] But, you know, we're doing, we have a four-person company.
[00:45:23.400 --> 00:45:23.960] Yeah.
[00:45:23.960 --> 00:45:25.880] Everybody's paid very well.
[00:45:25.880 --> 00:45:26.040] Yeah.
[00:45:27.560 --> 00:45:31.880] And, you know, there's certainly threats.
[00:45:31.880 --> 00:45:32.360] Sure.
[00:45:32.360 --> 00:45:36.680] This was a debate I was having with Dave Zorob at Chartable.
[00:45:36.680 --> 00:45:39.640] And his answer changed depending on how things were going.
[00:45:39.640 --> 00:45:42.040] Because we started our companies at about the same time.
[00:45:42.040 --> 00:45:43.400] He went venture capital.
[00:45:43.800 --> 00:45:46.240] He raised money and we didn't.
[00:45:46.880 --> 00:45:55.120] And so the first six months, he was doing better because he had money in the bank and he, you know, he wasn't suffering as much as John and I were.
[00:45:55.120 --> 00:45:56.240] Yep, yep, yep, yep.
[00:45:56.240 --> 00:46:01.680] But then, you know, 12 months in, John and I are both full-time.
[00:46:01.680 --> 00:46:03.920] We'd both quit our previous things.
[00:46:03.920 --> 00:46:09.520] We're already making probably maybe even a better salary than Dave is at that point.
[00:46:10.400 --> 00:46:16.400] And then since then, it's, you know, maybe Dave was looking at us going, man, I wish I'd done the bootstrap thing.
[00:46:16.960 --> 00:46:24.400] But then he just sold to Spotify, and maybe it changes again, you know, the calculus.
[00:46:24.400 --> 00:46:35.920] So how do you think through that stuff when, and, and, and, and then also, and Dave was raising money because he wanted to own the podcast analytics space.
[00:46:35.920 --> 00:46:36.320] Yep.
[00:46:36.640 --> 00:46:43.680] Not a huge market, but he wanted to own that space, and arguably he accomplished it.
[00:46:43.680 --> 00:46:49.200] Arguably, his timing was better than the six podcast analytics companies that had come before him.
[00:46:49.200 --> 00:46:50.960] And so it paid off.
[00:46:50.960 --> 00:46:54.400] How do you think about that calculus of?
[00:46:54.400 --> 00:46:56.800] And clearly, chart mogul's gone a different route.
[00:46:56.800 --> 00:46:59.760] They don't want to own the market in terms of market share.
[00:47:00.800 --> 00:47:02.400] They're doing a different way.
[00:47:02.400 --> 00:47:06.080] So, how should people be thinking about that calculus?
[00:47:06.640 --> 00:47:08.160] Is it a strategic thing?
[00:47:08.160 --> 00:47:09.760] Is it a personal thing?
[00:47:09.760 --> 00:47:13.040] Should bootstrap companies try to own their market?
[00:47:13.040 --> 00:47:16.480] I think there's two really important questions you have to ask yourself.
[00:47:16.480 --> 00:47:19.120] One, the personal thing.
[00:47:19.120 --> 00:47:20.080] What do you want?
[00:47:20.080 --> 00:47:20.400] Right?
[00:47:21.040 --> 00:47:35.000] Like, Dave, I don't know, Dave, but like, I could see a world where if I was in his shoes and I raised money and I went balls to the wall and I failed, let's say someone else came along, Spotify came out with their own stuff, you know, they have to shut the company down.
[00:47:35.800 --> 00:47:36.200] Yeah.
[00:47:36.200 --> 00:47:38.920] There's a world where he learned those lessons.
[00:47:38.920 --> 00:47:43.160] And half the time you or I would learn those lessons with a bootstrap company, right?
[00:47:43.160 --> 00:47:45.320] Because money is speed, right?
[00:47:45.640 --> 00:47:48.760] And so I think it's like, what do you want?
[00:47:48.760 --> 00:47:51.560] Like, what do you, do you want the quickest path to learning, right?
[00:47:51.560 --> 00:47:55.640] If you want the quickest path to learning, maybe fundraising is the right way to do it, right?
[00:47:55.640 --> 00:47:58.680] And it's, it's never, like we were talking about before, it's never a binary thing.
[00:47:58.680 --> 00:48:00.440] There's not like one thing you want, right?
[00:48:00.440 --> 00:48:03.160] But there's a set of values that you want.
[00:48:03.160 --> 00:48:08.040] And those are the values that you like, even us, like we didn't want to grow at all costs, right?
[00:48:08.040 --> 00:48:10.440] Like we didn't want to be a large company at all costs.
[00:48:10.440 --> 00:48:13.320] We wanted to like protect certain aspects of our culture.
[00:48:13.320 --> 00:48:17.960] We wanted to protect certain aspects of like the value people were getting, et cetera.
[00:48:17.960 --> 00:48:20.040] And so I think that's the biggest thing is like the personal.
[00:48:20.040 --> 00:48:25.320] And then another question is, is like, is it the right time for funding?
[00:48:25.320 --> 00:48:31.720] So there might be, funding might be off the table for a bunch of things, for a bunch of the personal reasons.
[00:48:31.720 --> 00:48:33.800] But then it's like, no, I want to build a big company.
[00:48:33.800 --> 00:48:35.400] And then is it the right time?
[00:48:35.400 --> 00:48:44.120] ProfitWill did not raise money at all, but we should have raised money probably four or five years ago, like 100%.
[00:48:44.440 --> 00:48:52.440] And the reason is, is because one, one point we should have raised money is, and this is pure hindsight, we wouldn't have known at the time.
[00:48:52.440 --> 00:48:53.880] So we wouldn't have done it.
[00:48:53.880 --> 00:48:59.720] We should have raised money when we realized we were doing a free product in a financial space that required accuracy.
[00:48:59.800 --> 00:49:00.760] Should have raised money.
[00:49:01.400 --> 00:49:04.040] Would have shaved probably a year off of our trajectory.
[00:49:04.360 --> 00:49:11.240] And then the other time we should have raised money is like when we started getting really good, repeatable growth out of our sales team.
[00:49:11.240 --> 00:49:12.280] Just should have raised money.
[00:49:12.280 --> 00:49:16.000] Because that's, you know, that's speed, you know, dump the money in, speed goes out.
[00:49:16.000 --> 00:49:19.840] And our metric, we were like really proud of like our LTV to CAC ratio.
[00:49:14.840 --> 00:49:22.160] And it was like, no, like, that's super cute.
[00:49:22.320 --> 00:49:30.560] But it also means that like we're not growing fast enough because we're not investing as much, you know, because we're getting all this like, you know, this low CAC, like we're not investing.
[00:49:30.560 --> 00:49:33.360] So those are the two things I think are really important.
[00:49:33.360 --> 00:49:37.680] And I don't know, ultimately, like you got to be at peace with your decisions.
[00:49:37.680 --> 00:49:43.440] And I think if we do those proactively, it makes the journey that much harder or that much easier, sorry.
[00:49:43.440 --> 00:49:52.800] Because if Dave theoretically had that thought process before he started chartable or like right in the beginning, if it blew up, he did the thing he was supposed to do.
[00:49:52.800 --> 00:49:54.080] If he sells it, great.
[00:49:54.080 --> 00:49:55.760] He did the thing he was supposed to do.
[00:49:55.760 --> 00:49:56.160] Yeah.
[00:49:56.960 --> 00:49:59.200] How do you do the calculation?
[00:49:59.200 --> 00:50:00.800] I mean, obviously it's hard.
[00:50:00.800 --> 00:50:01.440] Yeah.
[00:50:01.440 --> 00:50:09.920] But it sounds like you recognized the threat and the opportunity of the billing side.
[00:50:09.920 --> 00:50:24.720] I think I read another interview, or you said this in your acquisition blog post that you had met the people from Paddle and you had said to your engineer, like, hey, if we're going to build billing, we got to do it now because these guys are doing it the way I would do it.
[00:50:25.120 --> 00:50:29.200] So obviously you were thinking about that threat and opportunity.
[00:50:29.520 --> 00:50:45.120] And there's like this threading of the needle of like, if we don't move now, like we either, we either partner up with somebody else, get acquired, whatever, or we may miss our window of opportunity here.
[00:50:45.120 --> 00:50:45.440] Yeah.
[00:50:45.440 --> 00:50:48.320] Or we have to raise money and build it ourselves.
[00:50:48.880 --> 00:50:51.200] How do you think founders should be thinking about that?
[00:50:51.200 --> 00:50:54.000] About the threats and the opportunities and the timing?
[00:50:54.000 --> 00:50:54.560] Yeah.
[00:50:54.560 --> 00:50:58.400] It's very possible, John and I could hold on to Transistor longer than we should.
[00:50:59.640 --> 00:51:08.280] It's really hard to come to peace with some of these things when, like, before you should, but that's what you should really focus on.
[00:51:08.280 --> 00:51:17.480] So, what I mean by that is, like, you and John, like, I don't know what your conversations are like, but maybe it's like, hey, we want to keep growing.
[00:51:17.480 --> 00:51:19.800] Here are some of our non-negotiables, though.
[00:51:19.800 --> 00:51:21.000] We don't want to raise money.
[00:51:21.000 --> 00:51:24.440] That changes the stakes, that changes our outcome, whatever it is.
[00:51:24.440 --> 00:51:27.640] We, I don't want to work more than X hours a week.
[00:51:27.640 --> 00:51:30.120] You, we both don't want to work that much, or whatever.
[00:51:30.120 --> 00:51:32.280] I mean, not saying you're not working, but you get what I'm saying.
[00:51:32.280 --> 00:51:33.800] We don't want to work 80 hours a week, right?
[00:51:33.800 --> 00:51:34.120] Yeah.
[00:51:34.360 --> 00:51:35.320] Whatever those are.
[00:51:35.320 --> 00:51:38.840] And we will grow at the pace that sustains these four things.
[00:51:38.840 --> 00:51:47.080] And if that means that this is a 10-year product, or if that means that this is only a three-year product because someone comes in and eats us up, totally fine.
[00:51:47.080 --> 00:51:47.960] You know what I mean?
[00:51:47.960 --> 00:51:49.560] That's getting peace with that.
[00:51:49.560 --> 00:51:55.080] I think for us, so the conversation that you're reading, I had interviewed Christian, the CEO of Paddle.
[00:51:55.320 --> 00:51:57.240] This was actually four or five years ago.
[00:51:57.240 --> 00:51:58.680] That's when that took place.
[00:51:59.240 --> 00:52:06.280] And we think about the world, ProfitWell and Paddle, we think about the same way, like in a very, I would say, unique way.
[00:52:06.280 --> 00:52:28.120] And the way that we think about things is, and I think it's true, first kind of 10, 15 years of SaaS in this market was all about creating products that just kind of like helped me show my boss that I was doing work or like gave me this like infrastructure to kind of do the work.
[00:52:28.120 --> 00:52:30.600] And what I mean by that is like you were the expert.
[00:52:30.600 --> 00:52:35.800] You were the expert sitting in your chair, and they just enabled you to use your expertise, right?
[00:52:36.120 --> 00:52:44.080] I think this next wave that we're in is the software creator is choosing problems where they should know better.
[00:52:44.080 --> 00:52:47.200] Because I don't, I think we were tweeting about this.
[00:52:44.280 --> 00:52:50.720] Justin, yeah, I don't know how to get podcast subscribers.
[00:52:51.040 --> 00:52:53.200] You know more about podcasts than I do.
[00:52:53.200 --> 00:52:54.240] Just do it for me.
[00:52:54.240 --> 00:52:54.640] Yeah.
[00:52:54.640 --> 00:52:55.600] Same with hosting, right?
[00:52:55.600 --> 00:52:58.720] Like, I don't, like, even that part, like, I don't know how to like host everything.
[00:52:58.720 --> 00:52:59.760] I don't want to figure this out.
[00:52:59.760 --> 00:53:00.400] Just do it for me.
[00:53:00.400 --> 00:53:00.640] Right.
[00:53:00.640 --> 00:53:01.600] And that's what Transistor does.
[00:53:01.600 --> 00:53:02.480] It was just so beautiful.
[00:53:02.480 --> 00:53:08.240] And so, long story short, when I met Christian, I'd never heard someone talk that way except us.
[00:53:08.240 --> 00:53:11.920] We were the ones who always talked about the way he like finished my, like, literally finished my sentence.
[00:53:11.920 --> 00:53:12.640] He's like, yeah, yeah, yeah.
[00:53:12.960 --> 00:53:14.800] And it was like a Kismet moment.
[00:53:14.800 --> 00:53:16.560] And I literally left and called Facundo.
[00:53:16.560 --> 00:53:20.240] And I was like, hey, man, this is the first person I've ever met that gets it.
[00:53:20.240 --> 00:53:20.880] We should build this.
[00:53:20.880 --> 00:53:23.120] Like, if we're going to build it, we should build it.
[00:53:23.360 --> 00:53:26.560] But to answer your question, I think that it's really hard.
[00:53:26.560 --> 00:53:28.800] Like, you have to have that thesis.
[00:53:29.120 --> 00:53:34.960] And then I think you have to have those pre-conversations about what is the outcome you want.
[00:53:34.960 --> 00:53:37.680] And then be very open to those outcomes.
[00:53:37.680 --> 00:53:47.120] Like, and it has to be like, I mean, we've all heard the fable about the guys in the boat or the guys stranded and God, why wouldn't you help me?
[00:53:47.120 --> 00:53:48.960] And God's like, well, I sent you the boat.
[00:53:48.960 --> 00:53:49.920] I sent you the person.
[00:53:49.920 --> 00:53:51.920] I sent those four people to help you and you didn't take it.
[00:53:51.920 --> 00:53:52.160] Right.
[00:53:52.160 --> 00:53:53.840] So you do have to take the opportunities, right?
[00:53:53.840 --> 00:53:55.040] It's not going to just come to you.
[00:53:55.040 --> 00:53:55.440] Yeah.
[00:53:55.440 --> 00:53:59.920] But like if you have those conversations up front, like we had slides in our board deck.
[00:53:59.920 --> 00:54:01.440] Here are our potential acquirers.
[00:54:01.440 --> 00:54:03.600] Here's where status is with all those conversations.
[00:54:03.600 --> 00:54:08.240] And we had that slide in that conversation for years before we actually did anything about it.
[00:54:08.240 --> 00:54:10.320] Like we understood like, here's where the market was.
[00:54:10.320 --> 00:54:11.280] Here's where we could go.
[00:54:11.280 --> 00:54:11.680] Right.
[00:54:12.400 --> 00:54:14.880] We also had a slide about who we could acquire as well.
[00:54:14.880 --> 00:54:18.400] And then in terms of identifying the market, a lot of the market will come to you.
[00:54:18.400 --> 00:54:22.720] Like, you'll be big enough, like, you'll have made those relationships with the right people.
[00:54:22.720 --> 00:54:25.520] And then, all of a sudden, like, hey, I was thinking about this.
[00:54:25.520 --> 00:54:27.760] Like, we have this new strategy for the next year.
[00:54:27.760 --> 00:54:29.520] Like, you guys would fit into it and want to talk.
[00:54:29.520 --> 00:54:31.720] And then you can make those decisions based on that.
[00:54:31.720 --> 00:54:32.120] Yeah.
[00:54:29.920 --> 00:54:32.360] Yeah.
[00:54:32.680 --> 00:54:38.120] Well, and I think there's also, I mean, it's tricky because there's so many dynamics.
[00:54:38.120 --> 00:54:41.000] I'm in my 40s.
[00:54:41.000 --> 00:54:42.600] And I think John.
[00:54:42.680 --> 00:54:43.560] I still don't believe it.
[00:54:44.440 --> 00:54:45.240] He looks so young.
[00:54:45.240 --> 00:54:46.680] He looks such like a child.
[00:54:46.680 --> 00:54:47.720] No, I'm just kidding.
[00:54:49.880 --> 00:54:54.760] I think John has the same feeling, though, of we are kind of an old school company.
[00:54:54.760 --> 00:55:01.160] You know, we're like an like Transistor is a fairly simple product with a very small team.
[00:55:01.480 --> 00:55:11.880] And if the next generation of SaaS, for example, is instead of paying for Canva, where you go in and you create these things and they've done some for you, they have templates.
[00:55:12.280 --> 00:55:26.040] But the next version of Canva is some sort of AI that just takes all your inputs and generates all of these assets for you and then shows you how to deploy them.
[00:55:26.680 --> 00:55:32.360] The next version of podcasting would be like the hardest part is content, right?
[00:55:32.360 --> 00:55:40.920] And that's where we've, the dynamics of the market really rely on people being incredibly motivated.
[00:55:40.920 --> 00:55:41.240] Yeah.
[00:55:41.880 --> 00:55:46.600] Most of our churn happens, you know, when I email people and I email them manually still.
[00:55:46.920 --> 00:55:49.560] When they cancel, I say, hey, just notice you canceled.
[00:55:49.560 --> 00:55:50.280] You know, what's going on?
[00:55:50.440 --> 00:55:51.480] I don't want to do it anymore.
[00:55:51.480 --> 00:55:56.280] And most of the times they have zero or one episodes.
[00:55:57.080 --> 00:55:58.600] That's the biggest one.
[00:55:58.920 --> 00:56:05.560] And, you know, if they get 10 episodes, they're much more likely to stick around.
[00:56:05.560 --> 00:56:11.640] If, you know, if they create an episode and submit it to Spotify, more likely to stick around.
[00:56:11.640 --> 00:56:16.800] If they create an episode and then figure out how to submit to Apple, very likely to stick around.
[00:56:16.800 --> 00:56:18.400] Like, it's just these hoops are.
[00:56:18.720 --> 00:56:26.080] But the next version of podcasting could be all AI-based.
[00:56:26.080 --> 00:56:30.640] It's like you don't even need to do anything anymore.
[00:56:30.640 --> 00:56:34.640] You just get it to generate the content for you.
[00:56:34.640 --> 00:56:35.600] It has your voice.
[00:56:35.600 --> 00:56:38.560] It automatically spits it out.
[00:56:38.560 --> 00:56:40.720] And then you just get to upload it.
[00:56:40.720 --> 00:56:49.600] And it's based on, like, let's say it can create a podcast for you automatically based on your tweets and your blog posts from the past month and everyone you interacted with.
[00:56:49.600 --> 00:56:52.640] And it just popped and it just does it and it's done for you.
[00:56:52.640 --> 00:56:54.560] So maybe that's the next version.
[00:56:54.560 --> 00:56:55.120] Yeah.
[00:56:55.120 --> 00:56:58.720] I would say that that's, I don't think that's the next version.
[00:56:58.720 --> 00:57:18.960] I think that that's so the one part of the thesis that I didn't talk about is that I think that the product and the team and the customer are still going to be reserved by whoever you're serving, whatever type of business or whatever you have a customer.
[00:57:18.960 --> 00:57:23.760] So like in your case, I'm still going to want to create the podcast, right?
[00:57:23.760 --> 00:57:28.960] Now there's a bunch of things around the podcast creation that like Riverside should do more of.
[00:57:28.960 --> 00:57:32.960] There's a lot of things around the distribution that I think you guys should do more of.
[00:57:32.960 --> 00:57:37.360] Like there's a bunch of automatable things around that that are probably up there.
[00:57:37.360 --> 00:57:45.120] I don't think, I do think some people will do like some automated podcasts, like Siri Frankenstein Monster kind of a thing.
[00:57:45.120 --> 00:57:46.880] But like, I think it's more.
[00:57:46.880 --> 00:57:47.200] Yeah.
[00:57:47.200 --> 00:58:06.920] What I would do, if I was trying to like look into this thesis for how it could better, you know, help my business, I would do all of the steps between pre-ide all the way through to like successful podcast.
[00:58:07.080 --> 00:58:14.920] And I would just line those out and I would categorize them based on probably creative, pre-production, post-production.
[00:58:14.920 --> 00:59:44.400] during like i'd categorize like five or six categories five or six colors on all those steps and then i would look at the color that most aligns towards transistor and be like hmm these three things they're like right next to what we're already doing they don't really require that much lift and they would be a differentiator these three things yeah i have no idea how we would solve those problems if we could that would be genius but like i have no idea so we're gonna put those in the back burner right that's how i would look at this like and i think that's that's how you can fix that yeah yeah there's there's other there are probably adjacent things and again the nice thing is you get to fit that to well then you get to decide on the trade-offs do we want to hire more people do we want to raise money here's my transistor idea i want you to create an ad campaign right from whatever episode and you can use the cover art and you just i don't know like you just automatically spit it out it's probably a million times more complicated than i think it is and then just give me a button hey man just click this button and i'd be like okay like i'm gonna set this up because i think that that's like i'll i'll manually do it on my end but like there's something there for like podcast distribution and i don't know there's there's there's something there beyond what you're doing, but that's what i want that's what i want as one user like like you want an automated uh promotion campaign for a podcast.
[00:59:44.400 --> 00:59:49.440] Yes, I don't know what because I there was a good thread I'm sure you saw it.
[00:59:49.440 --> 01:00:05.280] I think it was NPR or something like that that talked about Where most podcast promotion like for charting and for a bunch of other things comes from like good ad campaigns where like they do ad campaigns because Apple, Spotify, et cetera, they value like the new users or whatever.
[01:00:05.280 --> 01:00:14.720] I couldn't remember all the details of it, but it was one of those things where I read that and I was like, that's great because I can get all the users already on my list, but I want other users, right?
[01:00:14.720 --> 01:00:19.360] So I've run like, I can't remember, what's the podcast platform?
[01:00:19.360 --> 01:00:22.000] It's got really simple ads you can grab.
[01:00:22.000 --> 01:00:22.800] Overcast?
[01:00:22.800 --> 01:00:25.920] Yeah, I've done overcast ads and that works pretty well.
[01:00:25.920 --> 01:00:33.200] But I know that there's like, and again, I'm not an expert in Facebook, LinkedIn, all these other stuff, but like, just give me a button.
[01:00:33.200 --> 01:00:33.680] Cool.
[01:00:33.680 --> 01:00:34.080] There we go.
[01:00:34.080 --> 01:00:36.320] The episode's out or the podcast or whatever it is.
[01:00:36.320 --> 01:00:50.400] Well, and certainly the most fertile ground for that would be dynamically inserted ads in other podcasts that have a similar audience to you, because that's where most of the uplift happens.
[01:00:50.400 --> 01:01:11.920] The reason that all the networks are advertising each other's shows, you know, like Malcolm Gladwell, I'm guessing 80% of their like lift for a new show just comes from promoting other podcasts and even in their own network because you're reaching people where they're at.
[01:01:11.920 --> 01:01:12.720] Totally.
[01:01:12.720 --> 01:01:14.880] Well, that might be that idea.
[01:01:14.880 --> 01:01:16.640] I'm realizing now I think about more.
[01:01:16.640 --> 01:01:19.040] This might be beyond the values you and John have set.
[01:01:19.040 --> 01:01:22.480] Like in terms of like, we're going to meet seven people just for that one feature.
[01:01:22.480 --> 01:01:22.960] But yeah, yeah.
[01:01:23.200 --> 01:01:24.640] Now I think we're actually on that one.
[01:01:24.640 --> 01:01:29.200] I think we're close because now we have a simple dynamic ad insertion tool.
[01:01:29.200 --> 01:03:05.920] Oh, that's cool and so we can create a layer on top which says we will help you guys cross pollinate that's great and we can do it manually at first just saying okay this is just for shows that have more than a thousand listeners and then we'll we'll match you up that's great but eventually that could be that could happen for sure yeah one question i have because we're dealing with this right now did do your employees have equity how do how do you guys figure that stuff out yeah so i think i'm gonna do a thread about this tomorrow um or at least this week um what's funny is the previous startup i was at did not in my opinion handle equity in a great way like everyone got equity but they were really cagey about the value of that equity like they would be like you get this many shares but they wouldn't describe like what that was worth right and this was 10 years ago where that was more common yeah so with profile well we very much focused on like okay like if there's an exit am i supposed to get 80 of this thing like is that how that works right like i think i should get a really large chunk and probably the biggest chunk probably the biggest chunk but like i don't know the stories like the mail chimp story i mean mailchimps it's it's it's obviously a great success but like it felt and i don't know how it felt to them like i think they set expectations with their team really well but like it probably felt weird that like the team or very few people on the team had equity, like they got a bonus, but like it was an $11 billion dollar exit.
[01:03:05.920 --> 01:03:08.480] Like, it's yeah that feels weird, right?
[01:03:08.480 --> 01:03:09.120] Like, I don't know.
[01:03:09.120 --> 01:03:11.600] Like, and it's an emotional and personal thing.
[01:03:11.600 --> 01:03:24.560] So, what we did is, um, interestingly enough, when we were talking about this, Andrew Mason, the group on guy and the descript guy now, he published this article when he was doing detour, which was like an actually really cool idea.
[01:03:24.560 --> 01:03:37.360] And he ended up talking about how like they did this progressive equity system where it was like basically the founder would definitely get the most, but it was like not egregiously the most.
[01:03:37.360 --> 01:03:41.040] So, we didn't do something specific as that, but yeah, everyone had equity.
[01:03:41.040 --> 01:03:46.080] Um, we accelerated everyone's vesting as long as they were with the company for more than a year.
[01:03:46.080 --> 01:03:50.320] We did a bunch of things to like help basically make sure that so.
[01:03:50.320 --> 01:03:52.480] Was this stock options?
[01:03:52.480 --> 01:04:02.400] Like, you, you, you, you gave them options, or no, it's kind of cool is like they had what are called um uh LLC profit interests, basically, or membership interests.
[01:04:02.560 --> 01:04:04.560] Okay, you're an LLC, yeah.
[01:04:04.560 --> 01:04:08.640] And so, which was a whole nother complicated thing to figure out.
[01:04:08.640 --> 01:04:16.240] Um, but I think that was, yeah, that was kind of the benefit is like once you had your shares, you technically owned them, which was kind of cool.
[01:04:16.240 --> 01:04:19.680] Like, you didn't have to, there was no strike price, um, anything like that.
[01:04:19.680 --> 01:04:21.920] They were basically founder shares, which is kind of great.
[01:04:21.920 --> 01:04:25.840] Um, and so yeah, they um didn't have to exercise them.
[01:04:25.840 --> 01:04:34.560] They didn't, they, if they left, we had plenty of people get, you know, good amount of money like that don't work here anymore, um, you know, which, you know, I think is great.
[01:04:34.560 --> 01:04:37.840] Now, at the end of the day, like, I got a lot.
[01:04:37.840 --> 01:04:46.720] Uh, so to only to only say that, um, bluntly, I have more money than many generations of my family will ever need.
[01:04:46.720 --> 01:05:02.920] And so it was one of those things that, um, like, it still is weird because even though we did this, it's like, I don't want to say there's guilt because I worked my butt off for it, but there's a little bit of guilt of like, well, I have this much, this person, like, did I really do X more than they did?
[01:04:59.760 --> 01:05:03.800] Like, I don't know, right?
[01:05:03.960 --> 01:05:07.960] Like, so it's an interesting, and I think this is also a very personal thing.
[01:05:07.960 --> 01:05:10.760] Like, don't leave that exit.
[01:05:10.760 --> 01:05:15.960] I wanted to make sure everyone was like, not necessarily happy because I think, you know, people can be unhappy.
[01:05:15.960 --> 01:05:21.000] Like, we had people cry over $10,000, like, tears of joy.
[01:05:21.400 --> 01:05:23.080] And then we had people pissed off.
[01:05:23.080 --> 01:05:24.760] They were only getting $100,000.
[01:05:24.760 --> 01:05:27.240] Like, money is a really weird thing with people.
[01:05:27.240 --> 01:05:37.480] And so, long story short, just be, just make sure you're like, you know, you don't regret how it looks, or not how it looks, but you don't regret how it all shakes out at the end.
[01:05:37.480 --> 01:05:38.920] I think that's an important thing.
[01:05:38.920 --> 01:05:39.400] Yeah.
[01:05:40.040 --> 01:05:41.720] Well, congrats, man.
[01:05:41.720 --> 01:05:42.360] Thanks, brother.
[01:05:42.520 --> 01:05:48.680] Like, to have an exit, I've always felt like it's okay to start a company for money.
[01:05:48.680 --> 01:05:49.320] Yeah.
[01:05:49.320 --> 01:05:55.240] And I also came from, you know, quite meager means.
[01:05:55.800 --> 01:05:57.480] I'm not a wealthy family.
[01:05:57.480 --> 01:06:07.480] I also lived many years of my life, like working a paycheck, but working hard and trying to feed kids and pay for a mortgage and everything else.
[01:06:07.960 --> 01:06:12.600] And I think it's okay and it should be celebrated when founders have a good exit.
[01:06:12.600 --> 01:06:13.400] So congrats.
[01:06:13.400 --> 01:06:14.440] I think it's great.
[01:06:14.440 --> 01:06:18.040] I think it's great that you did well.
[01:06:18.040 --> 01:06:22.760] And now that you've got this new adventure with Paddle, it's pretty awesome.
[01:06:22.760 --> 01:06:23.640] I'm pretty excited.
[01:06:23.640 --> 01:06:27.400] And yeah, I'm sure there'll be a lot more.
[01:06:27.400 --> 01:06:29.640] Well, we'll see a lot more content out of Paddle, I'm guessing.
[01:06:30.040 --> 01:06:31.400] Is that the next part?
[01:06:31.400 --> 01:06:35.960] Yeah, there's a, I think I tweeted rather cheekily in it, but I mean it.
[01:06:35.960 --> 01:06:41.640] Like, if you ever wanted to see what we could do with funding, get ready because it's going to be exciting.
[01:06:41.640 --> 01:06:57.200] Like, we're like, people don't realize, like, one, people don't realize we're the only bootstrap company in our space, but also, like, to do some of the ideas we did, we were like scraping by and doing like terrible decision-making around, like, you know, oh, we have to squeeze this amount of this or that.
[01:06:57.200 --> 01:07:00.960] And now we don't have to worry about all of those decisions anymore.
[01:07:00.960 --> 01:07:02.880] And so it'll, it should be a good time.
[01:07:02.880 --> 01:07:03.680] Yeah.
[01:07:04.000 --> 01:07:04.240] Yeah.
[01:07:04.240 --> 01:07:09.360] That'll be interesting for you to experience the other side of that.
[01:07:09.360 --> 01:07:14.160] Because if you were quite frugal before, you know, there's pros and cons to everything.
[01:07:14.160 --> 01:07:24.640] But sometimes, certainly, the disadvantage of frugalness is that you're not willing to try more experiments that could just waste 10 grand, for example.
[01:07:24.640 --> 01:07:26.560] Are we willing to make this 10 grand bet?
[01:07:26.560 --> 01:07:27.040] Yeah.
[01:07:27.040 --> 01:07:27.680] No.
[01:07:28.000 --> 01:07:33.360] Well, maybe we should make that 10 grand bet because that 10 grand bet might turn into 100 grand.
[01:07:33.360 --> 01:07:33.680] Yeah.
[01:07:33.680 --> 01:07:35.040] That would be a good bet, you know?
[01:07:35.040 --> 01:07:36.160] There'll be a lot of good bets.
[01:07:36.160 --> 01:07:37.360] Yeah, that's great.
[01:07:37.360 --> 01:07:37.840] Yeah.
[01:07:38.080 --> 01:07:39.440] Congrats again.
[01:07:39.440 --> 01:07:40.960] Congrats to you and your team.
[01:07:40.960 --> 01:07:41.440] Thanks, Bill.
[01:07:41.680 --> 01:07:42.240] All the best.
[01:07:42.240 --> 01:07:43.360] All the best luck.
[01:07:43.920 --> 01:07:50.000] And let's chat again in like six months and see how things are going over there.
[01:07:54.800 --> 01:07:56.240] Thanks again for listening.
[01:07:56.240 --> 01:07:58.560] Be sure to follow Patrick on Twitter.
[01:07:58.560 --> 01:08:00.000] He is Pattikus.
[01:08:00.000 --> 01:08:02.560] All of the links are in the show notes.
[01:08:02.560 --> 01:08:08.640] And let me do some shout outs to our monthly supporters on Patreon.
[01:08:08.640 --> 01:08:10.640] We have Jason Charnes.
[01:08:10.640 --> 01:08:14.480] By the way, Jason, thanks for mentioning Transistor during your Rails talk.
[01:08:14.800 --> 01:08:16.320] We really appreciate that.
[01:08:16.320 --> 01:08:49.320] Mitchell Davis, Marcel Folley, Alex Payne, Bill Kondo, Anton Zorin, Mitch, Harris Kenney, Oleg, Kulig, Ethan Gunderson, Chris Willow, Ward Sandler, Russell Brown, Noah Prale, Colin Gray, Austin Lovelace, Michael Sitfer, Paul Jarvis, and Jack Ellis, Dan Buda, Darby Frey, Brad from Canada, Adam Duvander, Dave Juncta, and Kyle Fox from getrewardful.com.
[01:08:49.320 --> 01:08:51.000] See you next time.
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