Startups
What was the question again? You wanted to know just how I got into startup?
Speaker 2:So someone pointed out something a little interesting in our Discord that both me and you have a good amount of experience going down the startup path. And I think both of us kinda take it for granted because we've just been in that world for so long. And they asked, can we do an episode on what it's like and why we did it and our experiences with it? So, yeah, I think we can start with you sharing a little bit about what your experiences was like.
Speaker 1:Yeah. Sure. No. I was just gonna say, I can't believe we never thought to do this episode. Like, it never was on my radar Yeah.
Speaker 2:Yeah. So obvious.
Speaker 1:So I guess I started stat muse with a longtime friend back in 02/2014. I had kind of, like, first five, six years of my career done freelance stuff, had a little, like, software agency and saved up some money and then kinda quit my job with my cofounder and started SnapMuse. I had always wanted to to do something higher risk. Like, I knew I had a really good job, paid really well, but it was still, like, just a high paying job. And the ultimately, like, a lot of it was my friendship with my cofounder, Eli.
Speaker 1:We'd grown up together, and we always kinda had said, like, eventually, we're gonna do something together. We both were at a point in our career where we could kinda take a break and just quit our jobs and try it. That was a lot of it for me. It was just like, wanna do something with this person and wanna do something higher risk, higher leverage, not just kinda hours in, hours out, which is what my career had been to that point. That was the main reason, yeah, getting into it.
Speaker 2:Did anyone tell you it was a bad idea, or did you think it was a bad idea?
Speaker 1:It's so hard to remember now. I mean, it's been eight eight years nine years ago. I I don't remember. I know my wife was really supportive. Like, we had saved quite a bit, so we were in a pretty good position.
Speaker 1:We had just built a house and just had a baby. So in that sense, it was kinda, like, awful timing, but it all worked out in the end. I guess it could have gone really badly. We did go a really long time. So I'd say six months in, my wife was like, was this a good idea?
Speaker 1:Are we sure? Because we, like, we thought we'd raise pretty quick.
Speaker 2:Mhmm.
Speaker 1:And I think it was a year before we actually raised, which we don't even know. I don't even know honestly how we sort of, like, weathered that storm. We didn't think we had that much saved. Like, we didn't have a whole year runway, but somehow we kept the lights on, I guess. I mean, I know how.
Speaker 1:I'd liquidated all my retirement accounts.
Speaker 2:That's what it was. I forgot. Yeah.
Speaker 1:That's what it was. Yeah. What about you?
Speaker 2:Yeah. I think for me, I think similarly, I always knew I wanted to do that. It was it was very clear. I mentioned this before. My dad is also a software engineer, which I think I take for granted a lot, but it gave me a lot of perspective.
Speaker 2:He pretty much spent his whole career again, very successful career, worked his way pretty high up, had an extremely high paying job. But like you said, at the end of the day, it's just a high paying job. And I kinda witnessed how he hit a ceiling where he just couldn't break through both on this just both on the compensation side, like, you know, there's a ceiling on how much money you can make. But also on, like, the freedom side, you know, at the end of the day, he still had to make sure some other person was happy so he can get his high paying salary. And he was you know, his day to day, he liked his job, but there were lot of parts of it that he didn't like and, like, just dealt with, and didn't really have any power really to make that any different.
Speaker 2:Yeah. So similarly, I started out as a consultant. Like like you, I, like, worked freelance, independent. And it was very clear that, okay, if I'm gonna work sixty hours a week, I'm just gonna get sixty hours of pay. And, of course, that rate went up over time, but it's a it's pretty, like, linear.
Speaker 2:Like, it just goes up in a linear amount, and at some point, you kinda cap out. I wasn't building anything that compounded over time. I wasn't really able to take advantage of my skill set. And another thing with a high paying job is if you are very, very, very good at what you do at a company, you probably might make, like, 20 or 30% more than someone who is not very good at what they do at the company. A company is never gonna pay you, like, five times more than they pay someone else.
Speaker 2:So at a certain point, you just have to go down your own route, I think, if you really wanna capitalize on that. No company is gonna really meet your value if you think you you have, you know, really high value. The only way only real way to capture that is by building something you own. So I think, yeah, it was clear for me. And I think at a young age, I did start a company with a friend similar to you, like a childhood friend that I knew really well.
Speaker 2:I think that's really key if you start a company. I know it's worked out with people where they've, like, met random cofounders, but in general, it is one of the most intimate relationships you're ever gonna have in your life. And, yeah, you need to do it with someone that you have some background with so you're not going into it, like, learning all this stuff about this person. Like, you already know their quirks and you already know how your relationship with each other is gonna work out. That company got acquihired.
Speaker 2:And then pretty much my whole career since then, I've been either very early stage employee, like either the first real employee or, you know, in a founder role. And, yeah, I've I've I've loved every second of it. It's something that is extremely hard. But like I said, my primary goal is to have freedom with my life and making it exactly how I want it to be. And you can't really do that when someone else is telling you, okay, you have to be here at this time to make this money.
Speaker 2:Yeah. So that that, like, underlying motivation, like, no matter whether it's going good or bad, I know that I I just, like, knew I couldn't give up on on any of it because that was the most important thing.
Speaker 1:Yeah. So that I would say, like, going from consulting or freelance to startup life, it was like, on the one hand, doing it for kind of financial reasons, like hoping to, like, have a bigger outcome in the long run. It was a near term shock, though. I mean, like, a lot of changes of lifestyle immediately. So just, like, making a lot less as an entrepreneur, I guess.
Speaker 1:But that freedom that you said, like, that was the the noticeable thing is, like, you thought you're free when you're freelance before that. Like, you're kind of, like, you're you're dating all of your clients. You're not really, like, married to anybody, so you feel like you're kinda roaming around. But at the end of the day, like, people are expecting things of you every single day. And once you start a startup, you realize, like, it's a blessing and a curse, but, like, nobody's expecting anything of you.
Speaker 1:Like, I was pretty well shielded from our investors. My cofounder kind of managing those relationships. And it's really like I had five years there where you kinda have to decide what's worth doing every day, which is Mhmm. Super fun and liberating, but also that that part can be stressful because you kinda doubt, like, am I doing the right thing? Are we going the right way?
Speaker 1:Like, all that stuff.
Speaker 2:I mean, the classic thing is I think every founder resonates with this. There's days where you wake up and you're like, wow. We are amazing. We are doing every single thing right. And literally the week after that, you'll wake up and you'll feel like, this is a huge mistake.
Speaker 2:We're doing every single thing wrong. Yeah. So it's a crazy roller coaster. And I've heard I heard you say this the other day, which me and me and Liz have talked a lot about where you said your cofounder, Eli, his, like, skill is that he just refuses to let statues die. Yeah.
Speaker 2:And that at the end of the day is the only thing
Speaker 1:that really
Speaker 2:is, like, just not not giving up for enough time. You're gonna have something that works out. I think Paul Graham has a whole essay about this where he's just like, if you refuse to die, you'll get rich. That's like, startups are very complicated, lots of things you have to figure out. But at the end of the day, if you stick with it long enough, there's just so many moments where you can give up and quit.
Speaker 2:If you just refuse to do that for long enough, that's just gonna work out. Like, it it just can't. So if you optimize for your motivation, that's kind of the thing that matters at the end of the day.
Speaker 1:Yeah. Okay. I've got a quick anecdote about my cofounder.
Speaker 2:So Oh, yes.
Speaker 1:We started Stat News, which is like a sports statistics site, and we started with the NBA. We were both big basketball fans. We were actually both co hap co captains of our high school basketball team. So I I have I'm really tall. I mean, I'm not really tall.
Speaker 1:I'm, like, six three, six four. But I have, like, long legs. I'm a pretty good runner, but I'm, like, a short distance runner. Like, I'm such a sprinter, which so maps to my, like, work style. I could run really like, when we did our conditioning drills in basketball, I could run what they like, a set of 10.
Speaker 1:Like, we run the court 10 times. I could run them, like, in forty nine seconds, which is really fast. But he we had this thing every year our coach did that was, like, this thing we dreaded all year that was called ten set day, where we had to do 10 sets of 10. So it's this, like, long endurance thing, and I could not make it through 10 set day. I never did my whole four years of high school.
Speaker 1:Like, I just gave up halfway through or whatever. And Eli was, like, dragging freshmen to the like, he's just like that is his thing. It's like, he will not quit anything. So so map to stat news. Like, five years in, we sort of, like, hit a point where our relationship and to your point, like, you gotta really know the person.
Speaker 1:There's just so many hard things when it comes to startup stuff. I can't imagine doing it with somebody that I didn't really know or that I had like, if you have reasons to bail because you don't really have a good relationship, you're going to bail, I would think. And Eli being kind of this longtime friendship of mine and just his personality really made it possible to be there five years. But ultimately, like, I haven't been there for the last three years, and Eli's still been going. I I think that is such a huge huge part of it.
Speaker 2:Yeah. Yeah. It's a it it it just does boil down to that, the endurance thing. And, you know, I've been doing this for a very long time. Like, probably my whole career pretty much have been around this world.
Speaker 2:And that this concept didn't really click for me until I would say this year where now that me and Liz are working on something together, it's it's just so clear that that's the challenge that's just constantly in the back of your head. Yep. But, yeah, if you can if you can conquer that, it is that's really all you need to do. You have some form of success eventually. I I think people say this all the time.
Speaker 2:They're like, companies don't run out of money. It's that the founders run out of energy. There there's, like, always a way to keep going if if you can do it.
Speaker 1:Can we talk about how we have these, like, freaky similar stories at our start ups? Yeah. Well, yeah, I guess, like I just said, I haven't been at Sammy's for three years. So, like, five years in, Eli fired me, which was, like, a whole shock. I was depressed for months.
Speaker 1:I mean, I knew, like, we couldn't keep going the way that we were going. We both were just at each other so bad after five years. And, like, there was just a lot of personal each of us kinda resented each other and lost a lot of respect for each other over various things. We were just pretty, like, toxic, and we had to have, like, somebody on a call with us. We just couldn't get anything done.
Speaker 1:So it needed to happen, but it was still a shock. And then ultimately, like, gone for three years. During that period, I had new investors come in and buy a lot of my stake in the company. So then I don't know how we discovered we have, like, this exact same story, but we were talking at re:Invent, and the same thing basically happened to you. Right?
Speaker 1:Timing and everything.
Speaker 2:Yeah. Yeah. Probably the exact same time. I think I was, like, maybe, like, six months after all this happened to you. Like, I was, like, six six like, a six month offset.
Speaker 2:So similar story. I early stage company was going incredibly well. And then at some point, me and the founder just started to run into a whole bunch of issues. And in my case, was, the founder was pretty inexperienced and he was just hiring a bunch of people that had no business to be at a startup and just kind of, we went from being like the best company I've ever worked at to like the worst company I ever worked at in a span of of six months or so. And then like a whole bunch of stuff like he like wasn't transparent about all these deals he did with the investors like ended up diluting everyone in ways that did not make any sense.
Speaker 2:So it just got to a point where we were just like, it was really bad. Like, I it's I think I was, like, basically refusing to work at some point, because they, like, completely messed up all my compensation stuff. And eventually, he fired me, which, again, similar situation, like, I should have been fired. And I was just kinda waiting for it to happen. And it happened and, like, it was actually crazy.
Speaker 2:I then went back to consulting and I was like, why am I getting so much work done? Like, I'm spending like two hours a day and I'm getting like way more work done. It turned out just the energy toll of being in a place that would just constant agitation and constant fighting that just takes up your entire day. Like, you're probably just sitting there thinking about these are you're having these arguments in your head, like Yeah. Every single day.
Speaker 2:Yeah. And that takes up a big amount of your time. But then similarly to you, somehow and this company should be dead. And again, going back to those keeping stuff alive forever. This company a 100% should be dead.
Speaker 2:It's still alive today. At some point, somehow new investors came in to the disaster of a company, and I was like, hey. Hey. Buy my equity out. And they did.
Speaker 2:And I guarantee you to this day, I will be the only person that ever makes money off of this startup. It's just it's just been like investor after investor coming in and losing their money. So yeah. Because they bought us out and and yeah. So fired by the CEO, both of us, at a company where we spent, you know, a lot of time putting in all of our effort.
Speaker 1:So Yeah. But then we got we got something out of it. I'm actually back at stat muse now, and I don't think I'll be the only person to make money. I'm I'm back on stat muse. I'm on the rocket ship.
Speaker 1:We're going to the moon. That's how you always feel when you're in a startup, except when you don't. Yeah. Like you said, it's every other week. It's such a roller coaster.
Speaker 1:Like, it really is. Were so many times we were close to acquisition and you're just on this mountain. And but the it's those moments when you're close to acquisition. For us, we were it was a few times that things were going so well. That's why we were close to acquisition.
Speaker 1:That you're kinda almost too optimistic and, like, you get all, like, stingy. Like, I don't wanna take just any deal.
Speaker 2:Mhmm.
Speaker 1:And then it falls through and you go into, like, a trough of depression and you take whatever anybody would give you but nobody wants to because it's it's just how it works.
Speaker 2:Yeah. It's kind of exactly what happened to us too. Was we're doing really well and then I just kinda took my hands off of, okay. I'm just gonna focus on the engineering stuff. And I mistakenly, like, let some parts of the company go.
Speaker 2:And that's when, like, you know, all, like, the terrible deals with the investors happened. Just again, because of inexperience from the CEO. Yeah. I think at this point, he owns must he must own, like, 3% of the company and he's not even CEO anymore. So I'm like, it's just not worth your time anymore.
Speaker 2:You know? It's like, yeah, it's a bad situation. I mean, I also did get something out of it. I I met Liz, my wife, at the company. So in a way, best possible exit
Speaker 1:Yeah.
Speaker 2:That you can have.
Speaker 1:Yes. Soldier steak, found a wife. Yeah.
Speaker 2:So it worked out pretty well.
Speaker 1:So we had a bunch of questions, didn't we? I think we kinda posed this that we were doing this episode. This is unique for us.
Speaker 2:Yeah. Yeah. So we had we had a few questions that people in Twitch chat asked so we can we can go over them. So I'm gonna try to do this in order that is somewhat cohesive. So people ask, at what stage in your career does a up become logical to pursue?
Speaker 2:Any thoughts on that?
Speaker 1:I mean, for me, it was after we had some money saved. I mean, maybe you do it right out of call. I don't know. Are there pros and cons? I could have missed something.
Speaker 1:I don't know how I would have done it, though, when I was we were newly wed. Had I not been married yet, maybe, right out of school, I could have done something like this. But I think with any one person kind of like depending on you in any way, it may it would make it really hard, I think. So I was all about making money right after school.
Speaker 2:Here's the thing I you definitely should not do. And I think a lot of people think about it this way. They're like, I need to have x y z experience before I go do this. Like, you're like preparing for the thing. But the best way to prepare is just actually do the thing.
Speaker 2:Like, there's no like, of course, you're gonna learn skills in in any place you work, but I think people have this, like, life plan where they're like, I'm gonna go work at a big company, then I'm gonna work at a small company, then I'm gonna go it's just like life doesn't work that way. Just if you wanna do the thing, just go do it. I think the major constraint, I think what you just said speaks of this is, it does take a lot of focus and effort. So you have to figure out what is, like, the baseline of your life that you can support while you're entirely focused on this thing. So if you have a bunch of savings, that, like, guarantees you can sustain probably a pretty high level quality of life while you're focused on this thing.
Speaker 2:If you are someone super young that has no responsibilities and can live with their parents, like, that's another way to do this. Right? Like, you have your baseline of life is, like, you know, is is covered and you can just kinda focus on this thing. So, yeah, for me, it's less of an experience thing and more of a can you actually focus on this thing in your life right now? And there's different ways to to achieve that.
Speaker 1:Yeah. You don't wanna be stressed about just basic needs and stuff like that trying to get something off the ground. It's too much to think about.
Speaker 2:Yeah. Exactly. And I think things have changed a lot when I was first starting. When was first starting, I think it was pretty not normal for founders to take any kind of significant salary. It was, like, kinda seen as,
Speaker 1:like, a red flag.
Speaker 2:Yeah. I think that's changed a lot now because investors realize, like, they're just kinda productive. Like, at the end of the day, like, they're gonna take a salary that accounts for, like, 5% of the runway or 10% of the runway. It's, like, really nothing just to give them the ability to fully focus on it. I've even seen certain investors be like, send me a list of every single thing that you need to do that's not related to your company.
Speaker 2:We'll make sure that it's taken care of by someone else. So everything from, like, your personal taxes to cleaning your house to, like, whatever, like, they they understand there's, a value in letting letting people really focus.
Speaker 1:I think we were kind of in that early that stage you're talking about where it was, like Mhmm. Don't take a big salary culture. But we had really good investors. Once we actually did raise our a, it was a bunch of strategics and stuff, then the VCs were
Speaker 2:Mhmm.
Speaker 1:Really kind. So they were all about, like, making sure we weren't distracted with personal stuff. We I felt like we got paid pretty well the whole time that Stampius, But I didn't think that was typical.
Speaker 2:Yeah. Yeah. Yeah. It's it's makes all this a little bit more more viable. I think before it was like bleed for five years and then
Speaker 1:Yeah.
Speaker 2:Then maybe you'll have some kind of exit.
Speaker 1:What was the next question?
Speaker 2:Is location important for the success of your startup? I mean, I think you have a really good perspective on this.
Speaker 1:Yeah. I mean, I have always lived in the Ozarks, which is not a tech hub, it turns out, contrary to popular belief, actually. There's not really a tech scene here, but my cofounder lives in San Francisco. So I feel like Statmuse doesn't have its story if Eli is not out in San Francisco because he did do a ton of fundraising out there, like, met personally with a lot of people that became close allies of the company. I do think there's something to that that sort of startup ecosystem in cities where they have such a thing.
Speaker 1:Just like the logistics of the travel. Like, there is just a huge contingent of people who still wanna meet you in person, and especially the older people that have all the money. I don't know. Maybe that's changed since the pandemic, and I I hope so for people that wanna start a company from wherever they're at. I was able to live in The Ozarks and cofound it remotely with my my cofounder, but we had a pretty good relationship.
Speaker 1:Yeah. I don't know. Is that what you were thinking I was gonna say?
Speaker 2:Yeah. Yeah. I think similar I think my perspective is similar. It's definitely possible. So you shouldn't let your location stop you.
Speaker 2:Literally, there's examples of people starting companies in every situation. So at this point, we know it's all possible. But, yeah, like like Adam said, there are just, like, tailwinds that you have when you are in a certain location. You can kinda, like, get embedded a little bit more in in the network and things like that. Again, all possible to do remotely plus traveling when you need to.
Speaker 2:Yeah. I mean, like, when we were in New York, it was nice to just be able to go meet investors for coffee, whatever, whoever it was, our customers. Now we're in Miami, like, we have customers in New York and Liz has to fly there to, like, you know, do launches and stuff. Yep. Which, you know, is a little bit more overhead, but again, still possible.
Speaker 2:And it's not like Miami's you know, Miami has its own own scene here as I was talking about earlier. Yeah. It it it does help, but you don't need it.
Speaker 1:Yeah. And I'm sure it's even more possible now in the last few years with I'm I'm sure there's lot more venture capitalists that are willing to not shake your hand and give you checks since they've had to start doing the Zoom stuff.
Speaker 2:Yeah. Yeah. Exactly. There's another question. I think I have a lot of thoughts on this one.
Speaker 2:But for engineers considering a startup which comes with a significant amount of equity, can you explain equity dilution and how it impacts engineers?
Speaker 1:So you're talking about, like, as an employee or as a founder coming in as a founding engineer, do you think the question?
Speaker 2:I think the dilution applies to everyone.
Speaker 1:Yeah. No. It does. I guess my answer might have been different because I just don't think I I just don't think it's a good idea to work for a startup. I think start a startup?
Speaker 1:But that's a
Speaker 2:whole other question, I think.
Speaker 1:I guess as a founding engineer, how does dilution affect you? I mean, like, you'll start out depending on how many cofounders with a big chunk. In my case, you know, we each started with 50%. And then when I left five years ago before I sold most of my stake, I think that was down to 20%. We had raised something like $20,000,000.
Speaker 1:It's just a it's inevitable that your equity stake goes down as the company gets bigger. But they always say, like, what do they say? It's better to have a little bit of a big thing.
Speaker 2:1% of a billion. Yeah. Whatever. I think there's a few things here. So, yeah, like Adam, I think a lot of people join employees join startups and think their equity is gonna be worth a bunch.
Speaker 2:It, like, almost never is a life changing amount. And, like, by definition, it can't be. You have a shot if you can be literally the first hire, maybe. I think anything after that like, you're not literally the third per there's two founders and maybe you're the third person, it's kinda like my situation at SST. Anything after that is not gonna be life changing.
Speaker 2:So you're doing this thing not for a life life changing outcome at that point. I think people don't really understand that. Just with the with the way the numbers work, you don't you're not gonna you're not gonna start off with enough to, like, make an amount that's gonna, like, do a I'm sure you can make some money, but it's not gonna, like, change your life for the most part. Yeah. And the dilution is, like, kind of crazy.
Speaker 2:So if things ever at all don't go well, which is very likely at a startup, you probably are gonna be wiped out to near zero. Like, if if the company has to take a down round, which a lot of companies are going through right now because they were over overvalued during during the pandemic, a lot of them are taking down rounds. When you take a down round, what that means is your previous equity was worth too much, so we're gonna correct that effectively. And the people they correct it from are the people with, like, common stocks. So the people, the founders, employees, like, the non investors.
Speaker 2:When that happens, it basically goes to zero. So you need to start off with enough where even when those things happen, like, you're still gonna end up with enough. I just tell people not to consider equity at all when they're working in a startup. I still think working in startup is a good idea, but mostly because you are someone earlier on in your career and it's your only way to get a ridiculous amount of responsibility that you're gonna be insulated from at a bigger company. So it's like, if you're gonna work there, it's for personal growth Yeah.
Speaker 2:Not for any, like, financial outcome. It can set you up incredibly well-to-do your next thing, but that little thing probably isn't gonna is not gonna work out.
Speaker 1:Yeah. I think my perspective on it is so, like is jaded the right word? It's so skewed because as a founder, I know we dangle the equity carrots to, like, employees to hopefully motivate them. Like, we want them to be aligned. That's founder speak for, like, we want you to work really, really hard because you wanna see this potential outcome.
Speaker 1:But, like, I know how rare that is. And even just, like, when employees leave or when bad things happen and you have to fire employees, like or lay them off, that they have to buy those options. Like, all those things, I know just, like, the chances of any employee you hire seeing a big payout from that equity, they're slim.
Speaker 2:Yeah. Yeah. The the buying the options thing is also another crazy thing because it's like you basically when you leave, you have to, like, make a decision. Like, do I think this is gonna be worth anything or should I just give up on it? And that's, like, it's always super annoying.
Speaker 2:It's tricky. A little hack to avoid dilution as much is start a company with your spouse. Because then Oh. On day one, most founders start with 50% equity. But on day one, we started off with a 100% of equity in our household.
Speaker 2:Interesting. Which means every single point where we get diluted, we get diluted, like, a lot less than than most
Speaker 1:Amazing, actually.
Speaker 2:Than most people.
Speaker 1:Hang on. I gotta go talk to Casey. I gotta call her.
Speaker 2:Got a new idea. It it also lets you give way more equity to employees. So we can roughly give out double because we have a lot more that we're working with. So, yeah, it's like a funny little thing we didn't realize till later.
Speaker 1:That's incredible.
Speaker 2:Yeah. So for step one, find find a spouse. Step two, make sure you two work together and won't ruin your relationship. Step three, then start a company. Easy hack.
Speaker 2:Okay. Then some questions, I guess, on the product side. Or actually, no. Let's let's get some more on the business side for now. Did you have to cold call in person advertise the businesses, or was your approach focused exclusively online?
Speaker 1:I don't think it applies to stat news. We're just a like a website for consumers. We don't have, like, a sales arm. We don't make money, basically. I'm just kidding.
Speaker 2:I think more generally, though, when you do start a company, you are gonna be doing some form of approaching random people, whether it's, you know, maybe you're trying to raise money, maybe you are trying to do a partnership with some other company. So there probably is there is a lot of that if you haven't done that. If you're just an engineer and you've never done that type of thing before, it is something you have to get comfortable doing. It is a huge asset when you build a network. I'm telling you, is so much easier than you expect.
Speaker 2:The moment you, like, plant the flag and say I'm gonna build this thing, people show up in your life, people, like, show up in your emails. Like, it definitely is possible. I know it feels impossible when you're starting off with nothing. But literally every single founder you see with a good network and investors, they start off with nothing and they weren't really, like, special or anything.
Speaker 1:Yep. Plus one.
Speaker 2:This is a how to cope with your startup money running out and employees not getting as much freebies?
Speaker 1:Wait. What?
Speaker 2:What does
Speaker 1:that mean? Employees not getting as much freebies?
Speaker 2:Like, company's cutting back? I mean, this just goes back to why why being an employee at a startup is is tough. Like, you don't you don't get that cushion that other companies have. But, you know, big companies are doing layoffs now too. Yeah.
Speaker 2:I think the trade off is that at a small company, if you are very good, you have a chance to retain your job because you are good even during rough times. At a big company, it kinda doesn't matter. Believe it or not, they just gonna cut x number of people and you're just you're just you're just
Speaker 1:out. Yeah. We did I mean, at Sam's, we never I guess we never changed our, like, new hire budget. So, like, we had, a $5,000 equipment slash whatever you need to be comfortable budget where you could buy a desk or a chair or whatever. And then generally, like, expenses were pretty loose and and we trusted people.
Speaker 1:But I think you don't hire that many people, so you're not too worried about. Like in an early stage startup, we didn't I mean, Total ended up hiring thirty, thirty five people, something like that.
Speaker 2:Yeah. I think I think a lot of companies a lot of startups operate like big companies even though they're not, they'll hire a lot of people and they'll need to, like, cut back and rethink things. That's always painful because taking away stuff is hard. And the way we think about it at SST is, for where we wanna go, like our ambitious most ambitious goals, we probably, over the whole lifetime of our company to get there, we'll probably only need to hire 10 people total. So when you kinda think of it that way, like, I only need to find 10, like, really amazing people.
Speaker 2:You kinda don't sweat, like, the little details around, like, how much exactly are they making or, like, what are they getting. It's we know if there's someone's good, like, it's just gonna be worth it because we only need to find 10 of them. How do you know your product is ready for development, like, from a technical level?
Speaker 1:I know, like, the Indie Hacker right answer. Like, if you think it's ready, just it's not, or you're too late.
Speaker 2:No. No. Say say the real answer.
Speaker 1:Okay. Real answer. So what we did was we had a a die deadline tied to the real world. We were launching a product for NBA fans, and we were starting in July. And in October, the season starts.
Speaker 1:And we really wanted to launch it with the peak excitement around the season starting. So that that was like a three month or whatever forcing function where we're going to ship whatever we have in those three months. Our product is a little unique in the sense that I mean, it's just an input. It's like Google. It's like a search box.
Speaker 1:And then it's just how good are the results. So it was it was pretty easy for us to just say, like, it's good enough.
Speaker 2:Mhmm.
Speaker 1:I don't know with more complicated maybe you wanna speak with Boomi, like, from, like, a customer driven development standpoint or something.
Speaker 2:Yeah. I think what Adam was alluding earlier with the whole Indie Hacker thing where it's like, just ship garbage. It's fine.
Speaker 1:So the mentality.
Speaker 2:Which, okay, I get. It just comes down to, like, does that click with you? Right? So for me, no, it doesn't. Because a big part of my advantage is that when people use my product, they're gonna feel like, oh, this, like, feels like, they're not gonna be able put their finger on this.
Speaker 2:Feels better than most stuff that I use. And that's a big selling point for anything that I I try to build. And I mean, there's a flip side. Right? I can like spend way too much time getting there and building something that nobody actually wants.
Speaker 2:So the key is don't forget that your idea for your company is probably gonna change a lot when you have people using it and they tell you about their problems and ideas. Like, the feedback is insane. Like, I'll go from not caring about a concept to, like, obsessing over solving it because I just heard that somebody had, like, I, like, witnessed someone with a specific problem. So it's good to have stuff out there because it makes everything a lot easier when you're working without having any users. You're just making up stuff and you're trying to have a vision.
Speaker 2:When you have users, they just tell you exactly what to do. So it is nice to have stuff out there. That said, like, I'm just think we've gone too far with that advice and now people are just, like, showing off how shitty their stuff is when they launch. I'm like, that's
Speaker 1:That's not the goal.
Speaker 2:That's is that the world
Speaker 1:we wanna live in? Like
Speaker 2:Yeah. How do I convince my co founder it's time to abandon? I didn't have you had conversations like that?
Speaker 1:Yeah. Actually, before I was fired, I mean, was I don't know if I should say this. I don't know. Honestly, oh, this is our 100 listeners are going to get a little scoop here. Like, I don't I just don't know if, like, investors could come after me or something, like fiduciary duty or something.
Speaker 1:I don't know. Should I not say it, Dax, what I'm about to say?
Speaker 2:I don't know what you're gonna say. So
Speaker 1:Okay. Well, I I was very on the record with Eli that we just gotta we gotta get out. We gotta, like, not abandon it, but every time we had an opportunity to sell, I was very hard on, like, let's just sell this thing because we just didn't have, like, a plan to make money. And we didn't know exactly everyone, like our investors, Disney, Google, these people, like, their strategics, they don't they're just like, grow it big. Make it big.
Speaker 1:Don't worry about money. But, like, we had to eventually worry about money, and I just felt like our best path is to get acquired by one of these companies. So I was very, like, adamant. In fact, I sent an email or I sent a message to Eli one time in the last months before I left that was like, we just we gotta tell I'm not gonna say who, but we gotta tell this person we're ready to do a deal. Like, it was this acquisition toxic kinda gone on, and it was like me basically saying, let's just tell them we're in business.
Speaker 1:Whatever. He got very upset that, like, you don't do that. You don't it's just fiduciary duty something something. I don't know. I probably broke some rules, some startup rules.
Speaker 1:Okay? I'm sorry. I've repented from my startup sins. I don't know. That was that was me just like, it's 10 set day.
Speaker 1:I'm done. I can't do this anymore. Mhmm. My wife was so done. Casey was just so tired of, like, waiting for it to get better.
Speaker 1:Because we had cut back salaries. We had, like, done a lot of things in the last year because fundraising was tough. So we were just kinda personally pretty done with it.
Speaker 2:Yeah. I think it's, it's hard. I mean, it's we we started by talking about, like, you know, not giving up, and that is a big part of it. But, yeah, there are situations like that. I mean, I had a similar situation where I try to convince the founder to again, similar.
Speaker 2:I wasn't saying, like, abandon it. I was saying just look for any kind of exit and we can start on our on our next thing. Yeah. Because in that situation, it was because, like, he accepted this ridiculous deal that went that left him with, like, no ownership. And I was like, it doesn't matter if this company, like, is incredible.
Speaker 2:You have no ownership or control. The whole point of doing all of this is now gone. Just it's okay. Like, it's your first startup. It's probably gonna fail anyway.
Speaker 2:Like, just write it off and let's move on. We can do something else. But I couldn't get through to him. He kinda saw it as like, no, this is like the vision. Like, I need to stick with it.
Speaker 2:I need to stay with it. And I've he's still working on it, and I've lived, like, five different lives since then. It's like, can't believe he's still, like, doing the same thing. Also, here's a little bit of, like this is a this is petty, but I'm gonna say it. When I got fired so pretty much the whole time I was there, it was, just me for a year, then we hired, like, one we hired Alan.
Speaker 2:We hired one person. Then we hired another person. Basically, effectively three engineers for, you know, three years or so. And we built the product, and then they fired me. And before they fired me, I I, like all all the engineers left as well.
Speaker 2:And, like, I think Alan joined a company I advised and another one joined one of the companies I was consulting at. So all the whole engineering team was gone. They replaced us with a bunch of other engineers. And I believe at some point it was like eight or nine engineers. Right?
Speaker 2:And it's been three or four years since then. They were gonna like rewrite the whole thing. Okay. I can still go to this site, and I can see it is still running the same code the exact same product, the exact same application that we left. Like, it now we've been gone for more time than we were there, and they have not been able to rebuild this thing.
Speaker 2:And that that brings me so much happiness. Like, you thought you could just you thought I was, like, not important. You can just let me go, and it was gonna be fine. Well, you're still running the same thing. You're still doing the same thing.
Speaker 2:All the same bugs are still there. Like, I I can see them.
Speaker 1:Oh, I love it.
Speaker 2:And it's it's been years, and I don't I have no I at this point, I have no idea what what they were doing. Like, I don't know how it's, like, not even a little replaced at this point. That makes me feel great. Makes me feel great. Go check it out every once in a while and feels good.
Speaker 2:Yeah. Alright. Let me see if there's I think we got through all the questions. Let me see.
Speaker 1:Oh, did we really?
Speaker 2:Yeah. I think that was it. Unless I missed something. But
Speaker 1:I guess we've gone on a little longer than normal.
Speaker 2:That's okay. Do you
Speaker 1:have any other thoughts? I don't think so. This was fun, though.
Speaker 2:Yeah. It was fun. And then just to summarize, if you're interested at all doing it, don't wait too long. Like, you are ready today, as long as you can dedicate some time to it. Find someone you can really trust and can work with.
Speaker 2:I mean, like Adam said, it could potentially, like, torpedo your relationship, but it hasn't happened to me yet. So it can also work out.
Speaker 1:And we're and me and Al are on good terms again. So, like, our story is one of it torpedoed a lifelong friendship, and then it's back. Like, we're we're good now. Yeah. One one thing I did think, Dax, just hearing you tell that last story is, like, on the one hand, in the same podcast you've said that, like, the key is to stick it out and to live long enough, like, things will work out.
Speaker 1:But then on the other hand, this founder that you worked with, the CEO Mhmm. Stuck it out, but maybe just, like, needs to read the situation better. Like, he is keeping it alive long enough. Yeah. But, like, what are his incentives to do so?
Speaker 1:Like, what is the payoff if he only owns 3% of the company or whatever? So you gotta live long enough that the company makes it. But if the company makes it and you don't really benefit that much, what was it all? Was it worth A decade of your life, like, that's the question.
Speaker 2:Yeah. Yeah. Exactly. You gotta keep that in mind that it still all has to make sense. It shouldn't have the outcome shouldn't be like, oh, if I just worked at some boring company for ten years, I would have been in a better place.
Speaker 2:As soon as that becomes true, like, the whole thing doesn't make sense.
Speaker 1:Good stuff. This is like a double episode, I think. I can't really read the timer from here.
Speaker 2:Is it that long?
Speaker 1:I mean, has it been thirty nine?
Speaker 2:Is that what that says? Thirty nine. Yeah. I guess I think it's close to double.
Speaker 1:Let's do the actual math. What the listeners need some I'm just kidding. Alright. Thanks, Dex.
Speaker 2:See you. See you.
