Startup Therapy Podcast

Episode #194

Ryan Rutan: Welcome back to the episode of the Startup therapy podcast. This is Ryan Rotan joined as always by Will Schroeder, my friend, the founder and CEO of startups dot com. Will we all know startups are a game of challenge and sacrifice and risk? But at what point do we cross a line? Which is not worse than anymore, right. Where does that happen?

Wil Schroter: I think way before we even realize it, right? I think that's, that's the point as we should dig into today, there is a point there actually is a point where whatever you're sacrificing just isn't ok anymore. And I feel like for a lot of founders, we don't feel like we're allowed to even talk about that. We're, we're not allowed to say, you know, fuck this. Like this is too much. And I think that's a dangerous proposition over the past year we're reflecting on in this case, if we're time stamping at 2022 was a disaster at so many levels. It was the worst gear for tech in like decades, right? So with that came just an absolute gutting of tons and tons of startups with that comes all of the founders like us that had to lead those startups and take all the pain and let's call it what it is trauma that it would take to lead those startups with the idea that there's gonna be some big benefit out of it. What if there isn't? What if, even if you get to whatever benefit the promise land you think you're going to get to the cost to get, there was too much for

Ryan Rutan: sure before we dig in and we've got a great breakdown for how we're going to divide this up kind of three major categories here. But before we dig into that back up to something you said right at the beginning, which is, and as founders, we don't even feel like we're allowed to talk about this because I think this is the root of the problem, right? This is why we end up way beyond the point of no return before we decide to return. So let's let's talk about that for a minute before we kick the rest of this off. Why the hell is it that we feel so comfortable talking about so many other aspects of our startup companies? But when it comes to the downside, when it comes to the burnout, when it comes to the risk and where our tolerance and limit and threshold for that is why are we? So I I'm gonna say scared because I think that's where a lot of it because it was a point of fear. Why are we so scared to talk about this? I'll give

Wil Schroter: you an example. And so having lived it, I mean, you've lived it as well. But, but here was my version firsthand. I start my first company. I just don't know any better. So a lot of it's just pure ignorance and I'll never forget. First year I was living in Ohio, but I grew up in Connecticut and first year Christmas comes around and I can't make it home for Christmas now. Not totally unusual, but certainly the first Christmas that I hadn't spent with my family in Christmas for most people is a fairly typical holiday to see your family. But I could, because I had too much work to do because I had started this company. Everything was on my shoulders and I was like, sorry, can't make it now. It wasn't just Christmas. It was every other day that year. So Christmas was just the one day you'd think like, ok, you know, we can, you know, finally put it aside, didn't do it. Now, here's what happens. Creeps up on you initially, next year goes by, I'm working just as hard every waking hour, seven days a week and mind you. I love it. I'm actually really enjoying it because it's something that I just, I couldn't believe I could build something myself. But Christmas comes around again. Guess what? Not gonna be there. Christmas comes around again. Guess what? Not gonna be there. At what point do I ever get those Christmases back? I mean, the answer is never, but now keep pushing. Now I'm looking at things like vacation time off. I didn't take a vacation or any time off for seven years. So that's from when I'm 19 to 26. Now you could look at that in a couple of different ways. One way you could look at it as in man. Those are years that you, you can, you know, put in the effort and not be sacrificing family. Another is, wait, you never went on spring break even though you're in college, right? You never did all the things that people do in their twenties. No, I'd forgot all of them because I was building company. But my point is not just the fact that that I sacrificed over and over and over, it's that I didn't see it coming. I was just foregoing that one vacation, that one trip, that one Christmas, but it started to build and then the things we're gonna talk about today, the categories of sacrifice that really just aren't ok. That's how they happen. They happen 1% at a time. Yeah. But they stack

Ryan Rutan: so many things in startups land, right? It's death by 1000 cuts and it's victory by 1000 small wins, right? We've talked about it and it works both ways, right? We see this when, when things start to go bad, tend not to be catastrophically bad. Yes, there are major catastrophes as things happen. Uh But to your point, most of these things are kind of a small, tiny little things creeping up on us over time. Victory looks the same way. Right? Like it's rare that you just all of a sudden hit this crazy inflection point. You go viral. Something happens and bang, you're an overnight success. Right? Yeah. 10 years later, uh, you're an overnight success. I still want to stick on this point for a second. And it's the, the why we're afraid to talk about it. I think you did a great job of laying out like symptomatically. So, I mean, and that's part, part of it is that we don't start talking about it soon enough because we don't even realize it's happening. But once we get to that point where we are aware that we now realize like I have over maxed my personal limit of whatever of the categories we'll get in today. Why aren't we willing to talk about it at that point? What is it? That's, that's really keeping us from opening our mouths and saying, you know, I think maybe this has gone too

Wil Schroter: far. I think we don't do it until it is so thrust upon us that we could no longer answer it. So, you know, I've told on, on previous episodes of cases where my heart stopped. Right. I mean, there's just no way to answer that or people go bankrupt. No way to answer that. Like we get to a point we get to a divorce.

Ryan Rutan: The hand is forced.

Wil Schroter: Yeah. Right. I think that's a, that's exactly what we're trying to avoid. That's why we're, we're airing this episode. We want to avoid that. We wanna avoid feeling that I'm just gonna keep chipping away until I'm in a fatal position.

Ryan Rutan: Yeah. Exactly. Yeah,

Wil Schroter: you're saying, look, man, if we were gonna gain £100 why weren't we concerned that at five or 10?

Ryan Rutan: That's the thing. And I think that one of the things that I hope come out of this episode is that we unlock the door to this narrative so you can start talking about it. Now, you're like, maybe just start considering what are my various limits? How far am I willing to push this point? What will change those things? Right. You know, giving up a couple of Christmases in your early twenties when you're single? Not awesome, but it's not the same thing as, I don't know, giving up Christmases when you have three Children and you're in your mid forties. Like I am like that would be a really unpopular decision with at least three humans. I know, right? Like it would, it would just be a disaster. And so I want to open the door to the narrative. I wanna make sure that we're talking about this stuff because when I hear it, I will probably the same for you when we talk to founders, it's almost always some version of postmortem. And I don't mean that literally in the case of the founder, I mean, the postmortem, in the case of the disaster, the startup, whatever it was that transpired, it's typically this revisionist history around why it had to go down that way. You know what happened, we're really making excuses about what's already gone on rather than talking about What can I do about this before it gets critical?

Wil Schroter: So, you know, there's another piece of that, let me build on that when I was taking that Christmas offer or, you know, for going that Christmas so to speak. I was so micro focused on the moment that if someone had just pulled me aside, someone that I respected that, you know, kind of had done this before and said, you know, dude, it's, it's three days, it's not going to make a lick of difference in the, in the, the span of your career or your business. But it, it'll be the only memory that you wish you didn't overlook. And that's what I tell people now. They're burnt out or they're gonna forgo something big or something like that. I say, look in life, you've got a specific number of moments that you kind of just don't get back, don't sacrifice those, the other ones, you know what you're gonna do on a random Tuesday. Uh sort of who cares. Right. And and I could make an argument there too. But man, the ones that matter

Ryan Rutan: matter, they do and those stack up too, right. Whatever it is that we think we're gaining and that we're probably not by missing those. There is so much accumulated debt that goes well beyond just the regret of it. Right. From burnout to the rest of it. All right. Let's, let's dig into it. Let's, let's get into it. What's, where do you want to start?

Wil Schroter: The first casualty is always your health, always your health. And it's the one that we chip away at and let's talk about the buckets of your health because I wanna make sure everybody's looking at it the same way. We've got our physical health, right? That's everything from just like our appearance, you know, cosmetically to our heart, not working or, you know, just, you know, something larger that's manifesting. We've got our emotional health just like our state or, you know, how are we feeling, et cetera? And then of course, we've got our mental health, right? Just, you know, anxiety, depression, et cetera and all of these things tend to be tied together. The problem is there's no good meter for most of them when I hop on the scale every morning. I know exactly whether physically I'm probably doing good or bad things, but there's no scale for my emotions, right? There's a lot of other indicators that things probably aren't good, but I don't have a good binary scale to say, you know what you're gaining a lot of weight in the anxiety category. Yeah,

Ryan Rutan: exactly. It's kind of like trying to assess whether or not you're ok to drive when you've been drinking, right? Like you're not in a proper mindset or state of mind condition to be able to make that call. Right. Same thing happens when our physical mental and emotional health start to suffer. It is the physical one again, a little bit easier to see, right? It manifests itself in very specific ways that most of us are able to recognize or are easier for other people to recognize, right? Like, hey, you, you seem to be putting on weight or hey, you seem to be losing a lot of weight or hey, you had a lot, you know, dark circles under your eyes. They're just things that people notice, people tend not to comment on mood or emotional state, right?

Wil Schroter: Or things you can't

Ryan Rutan: see. Right? You can't. Right. Right.

Wil Schroter: Yeah. You know what I mean? And the point though is what's too much, right? Ok. If I gained £10 over the course of my seven years, ok. You know, it's probably not too much, I'm

Ryan Rutan: assuming it was all lean muscle, right?

Wil Schroter: Never. And this isn't just about the cosmetics of it. I'm saying the health that comes with it if I get a couple scares of the doctor because my cholesterol is, you know, a little off the charts. Is that too much? Sort of? Yeah. Right. If I am depressed, anxious and not just like the typical that everybody is, but I mean, if I'm notably clinically depressed every day, is that too much? And by the way, that's usually where I see it the most often, you know, where I talked to founders in their, they have lost sense for what a baseline of mental or emotional health could even be anymore. They have just been an absolute state of trauma 24 7. If they forgot. It reminds me of when soldiers talk about being in the trenches, they're getting bombs so often that they forgot that bombs aren't supposed to go off in your life. Correct.

Ryan Rutan: Correct. Correct. Yeah, I, I think this is, and, and you and I both started very young and I think there's a trend now where we're starting to see founders start younger and younger may not even be that they've forgotten. They don't even know what adult life really looks like. When I both transitioned into this, we were sorry companies around the same time, we got the right to vote. Like we didn't know what grown up life was supposed to look like and we developed into adults alongside of or in spite of or we didn't, you know, there was definitely some arrested development on my part because of my companies. Right. And so there wasn't a baseline to even measure from right. The last thing I had was like, well, I'm at home with my parents. This is what life looks like. Now, I'm out on my own, but I'm also, you know, carrying around a startup company. This is what life looks like. Right. Not exactly a great apples to apples comparison for what a more normal life or like a life that everybody else is leading might look like. Right. I think that's the other challenge we face is that we're so starkly in contrast with what somebody who's just starting their first job out of college. Um, and following a, a more traditional career path, looks like that. We can't look around and go. Oh, ok. That's, that's what I should feel like we know that we can't use that as a baseline, but we don't have anything else that we can.

Wil Schroter: You have made a really good point. I, I've never really contemplated in quite the same way. You and I started early on as teenagers essentially in real career, you know, not just like we're working for somebody else at some intern position. We're actually the CEO S of our companies. And because of that in our formative years as adults, we never really got a chance to just be kids in the sense of being in your early twenties, you know, college years, et cetera. We went straight to the other side of it and I remember I really struggled with this, really struggled with this being forced through maturity. So I'd go to work and I was used to be some 40 something year old guy. Right. But I was 22. Yeah, exactly. At 22. Right. And I had the, the mental maturity. Right. As far as, like to run the business, I was fine. Like being mid forties guy. That was cool. Right. That made sense to me. Like, business wise, what needed to get done? No worries. But just at the end of the day, I just wanted to go out and hang with my friends. I just want to do stupid things that you do at 22 years old, but it's not appropriate. Right?

Ryan Rutan: Maybe just even get pop culture references. I remember there were long periods of time where people would reference stuff and I would laugh. I had no idea what they were talking about. I'm like,

Wil Schroter: my friends would play new music

Ryan Rutan: and I, what is it called again? Right. Like I have no. Yeah. Literally. Yeah. Music was like, there are gaps in my musical lexicon that span like a decade where people are like, oh, do you remember? I'm like, not at

Wil Schroter: all. Yeah. It's painful. But so again, what's it worth? And that's what we, we keep coming back to is how much of it is too much. And I think that what we'll keep coming back to is we do have to think about what is too much. And I think when we look from the outside and we talk to other folks and we say, hey, man, is this worth it anymore? Often nobody's even really asked them that question or another founder hasn't asked them that question on that context. I was talking to a guy last night, we were at dinner. A great founder has been in it a few years, but he's really worn down. And I asked him, I said, is this worth it anymore? He's like, well, what do you mean? I was like, you know, there is a point where this just isn't ok anymore. There is a point where you don't get to see your kids anymore. It's not really ok. Right. There's a point where you, you burn through too much cash or your health sucks. It's just not ok, whatever this thing was supposed to do, it's not worth it. You know, here's the best analogy I can use and I used it last night. You are an abusive relationship and no one will tell you and at some point not worth it anymore.

Ryan Rutan: Right. It's not worth it. No, it was never worth it. You just can't see it. Right. And, and that's the thing, right? So from the inside it can be, it can be such a challenge. Yeah, I think, you know, you reference 2022 which is now behind us. Barely, but I never had more of these conversations around. Is this worth it? Right. And, and there were times where I initiated that conversation where I was asking out of true concern for a founder's mental, physical, emotional well-being. And there were times where people came to me asking me, is this still worth it? Right? Should I still be doing this? And of course, it's really tough, right? It's not basic math. It's not like, well, let's just take a look at your P N L and we'll see. Right? It's not that simple, it's super, super complicated calculus that leads us to understanding whether we've crossed an individual's threshold. And of course, you know, you're trying to balance out how close am I to maybe success versus how close am I to total collapse? You know, physical, mental, financial, whatever.

Wil Schroter: I think there's this idea and, and I wanna, uh we both want to kill this idea that I just burned through everything and it's ok because I built something amazing. Right. Right. Not really. I mean, look, if it's ok to you, it's ok to you. I, I can't possibly tell you what's ok to you. What I'm saying is, it's probably not ok to you. And it's ok to say that for example, when we talk about the relationships that it costs us, you know, a lot of, of uh of startups are paid for, in relationships. I don't think people understand that on the outside, they look at the, the story, the, the Rags for Riches story and they think about Wow, the outcome must be great. You know what it costs me to get there and they just think about money. Oh, you know, you burn through your savings. Well, dude, right, what it costs me, my relationship with my family. Right. In that entire time when I wasn't coming home, when I wasn't spending important years, I lost touch with my family. Never caught back with my family in the same way since. Right. That was a cost if someone could have gone back and say, hey, do you wanna pay that for whatever level of success or some next level of success? I would have said no. Yeah, I didn't see it coming.

Ryan Rutan: It's funny we could probably make a great analog here for your personal cap table. Right. Yeah,

Wil Schroter: it's, I love that. I've never heard personal cap

Ryan Rutan: table. I, it happened right here. So if we think about it in that term, right? We, and we do this all the time when we're thinking about, you know, taking on investment or, or, you know, hiring people and giving away equity, bringing on a co-founder or whatever we think about the company's cap table in terms of is what I'm about to gain from this worth. What I'm gonna give up from my company, but rarely or never do we ask ourselves is what I'm gonna give up personally worth what I think I'm going to gain from this. Right? And my guess is if we actually did that math, we would make very, very different decisions because to your point, we can't just simply say, well, the outcome will somehow magically justify it. Right. Easy to say when you're third party to it and you're just looking at it here, here's, here's one, let's use the Egyptian pyramids, right? So, the Egyptian pyramids and I don't remember the exact numbers, but there was a catastrophic amount of loss of life in the construction of those things. Now, we can look at it and go but there one of the wonders of the world, right? It was amazing. It was worth it. Unless you were one of the poor bastards that got one of those things dropped on them and died or just, you know, collapsed in the exact right. You don't care, right? You don't care. It wasn't worth it for you. And so I, I think we have to be really careful about because what we're essentially doing is revisionist history before the fact. Right? Sounds bizarre because it is, we're saying what I'm doing today will someday be worth it when I look back and say this sacrifice will have gotten me this thing that maybe I won't get. But if I do it, this will have been worth

Wil Schroter: it. You know, something that's really funny about everything we talk about here is that none of it is new. Everything you're dealing with right now has been done 1000 times before you, which means the answer already exists. You may just not know it, but that's ok. That's kind of what we're here to do. We talk about this stuff on the show, but we actually solve these problems all day long at groups dot startups dot com. So if any of the sounds familiar, stop guessing about what to do. Let us just give you the answers to the test and be done with it. I'll give you another angle to that. My wife and I over the past 10 years have had some opportunities to kind of do some of the things. You know, we, we kind of moved around the country, do some of the things that we thought were going to be the benefit of all those sacrifices. I mean, quite literally, we said if we make sacrifices for 20 years, then one day we'll be able to do this and we did that thing and it was like cool for a day. Yeah, I was like, well, shit. So I sacrificed for decades. So that one day I could have a thing that it turned out when I got. It didn't really matter. You know, this is the same thing if we were to look in, in your parlance and I love it. The relationship cap table, the the life cap table, right? We were to look at that and we were to say not only how many relationships do I sacrifice. Whereas like in my case with my family, you know, we weren't as tight as, as I would have liked to have been. But then there's another side of this. How many relationships don't I have? Because how many people didn't I meet? How many places didn't I go with somebody to have this amazing experience, et cetera because I thought replacing it with work would have a higher and better outcome. Yeah.

Ryan Rutan: It was all about the R O I. Right. It's just a compounding interest problem. Right. We put in time now and magically the universe will make sure to pay us back for that sometime in the future. It doesn't. Universe is a jerk. You

Wil Schroter: mentioned this a moment ago. We're both in our forties. We both have three. You have three kids. I have two kids and we're both in a uh where those moments with our kids, we can't replace specifically with kids. You get a very finite window. They're only kids, you know, for a short period of time and every time you sacrifice something, you don't get it back, stakes go higher. Right. So now if you and I do something workwise and we give up something with the kids again because you know what's too much to sacrifice. It's kind of like my kids only be a kid once work's gonna be around forever. Now, that doesn't mean it gives me a whole pass to just ignore work. Right. Right. But I should at least be doing the calculus. You

Ryan Rutan: have to, you got, you have to, I did this yesterday. Right. I made a tradeoff yesterday, specifically, yesterday, we decided to extend our stay at the coast. Normally we just go for the weekend and we come back by Sunday night and then back in the office on Monday, uh, it's easy. We couldn't arrange for the surf lessons over the weekend. They couldn't do it till Monday. And I wanted to have, I, my, my daughters have done this twice without me and I felt it. I could just feel this tradeoff of like being three surf lessons behind my daughters. Right. They can both just jump on a board and I'm like, I'm not gonna let that happen. I'm like, for whatever it was I was gonna get done on Monday, I'll get done later on Monday. I'll get done on Tuesday. I'll work on Martin Luther King Day. I'll do something to make up for that, but I'm not gonna miss this day. Right. I said my, this chunk of my personal cap table is not worth whatever else I was going to accomplish in that time. I'll make sure I cover up on the important stuff. Got on the leadership call, did what we needed to do and did the surf lesson, right? And I'm really happy with that decision. Nothing at

Wil Schroter: all. Now, you gotta understand. This isn't like I get to do that. You get to do that every day, but the point is if you don't use some of your free plays, you're getting a jail free cards. What's the point?

Ryan Rutan: What is the point in, in, in? What are, what are we trying to build here? Right. Because if you talk to people, especially at the early doughy eye starry eyed stage, right? Where they're like, I wanna be my own boss. I want to set my own schedule. I want to be in charge of my own destiny. Talk to that person three years into their startup. Ask them how in charge they felt of their destiny. Ask them how much time they've exercised that freedom and they'll be like, exactly, never. But I still love the idea of it. You know, it's still, but still one of these days. Right? To your point. Oh, we'll wait, we'll wait 20 years and we'll sacrifice and then we'll get the, we'll get the L A house. Then you came running right back, right? Because it wasn't what you'd hoped. Right. And, and luckily you were smart enough to reverse course and say, hey, we were actually happy. You're doing something different. Let's do that and not just stick with the reward simply because we've earned it.

Wil Schroter: Right. Yeah. And that was a tough catharsis because, you know, we got to a point where we get this beautiful house on the side of a mountain and we're like, this is what we sacrificed for. Right. And after the first year we were like, fuck this mountain. It's hard to get up. We get cell service up here. Right. Like we're

Ryan Rutan: out of here. I have to look at channing Tatum's abs every time I drive into town while he's running up the hill. Yeah, I would have made that. I would have made that once. I'd be like, I'm out better

Wil Schroter: for my wife than me. Right. But, but, but, but all of a sudden you look at it and go, damn, you start running the math. I look back and say, hm, how much did I sacrifice for this opportunity? Be? Well, one, if I never took it that it would be even worse. Number two. Now that I've got it, I'm like, damn, I could have spent the past 20 years doing a million other things. Now, I wouldn't have had this opportunity. Fair. And you don't know that you, you know, you want it or you don't need it until you actually have it so that there's a little bit of a balance. But I look on it going back to the relationships and I think to myself how many relationships aren't better because I didn't have that time, didn't devote that time. How many people don't. I know because I didn't have that time and I start to create in my mind and I know you're doing it too and I was happy to see it yesterday. A limit switch where you say this is worth it. And this is it because I'm never gonna look back on my life and say, oh my God. Remember that one time I didn't go surfing with my kids so that I could go write some S E O content or something like

Ryan Rutan: that piece has performed so well. I wonder how my kids are. They haven't called me in years. Right. Like, never gonna be a tradeoff I made.

Wil Schroter: Exactly. And so the last piece though, that, that I think is worth talking about, it's one that's the most obvious, which is financially, what is the level of financial health that I'm willing to sacrifice in order to be more wealthy. Now, here's the idea. The idea is I'm gonna sacrifice a lot. I'm gonna bet my credit, whatever forms of it, I'm gonna bet my savings et cetera. And I'm willing to go in a certain amount of debt or go broke et cetera because I know the benefit will be so much higher. Now, of course, if we knew the benefit would be that we'd be fine with it. Maybe. Yeah, if

Ryan Rutan: it was a certainty. Right. If we were, if we were putting this into a certificate, deposit with a guaranteed rate of return, different story, that is not what a startup is. It's exactly the opposite. But

Wil Schroter: now let's play this out. Now you're 357 years in and you're not only broke, you are bankrupt,

Ryan Rutan: broke, you might, you, you have negative

Wil Schroter: money, you have negative money. And let's play with that. So I've referenced before that like by the time I was 22 I was $100,000 in personal debt with the market ability. Like if I went out and, and got a job to make 5 to $7 per hour at Best Buy, best case.

Ryan Rutan: Yes. So uh what are, what are your core skills? I can rack up debt faster than, oh my God,

Wil Schroter: I'm, I'm firing through bankruptcy. I'm starting my career bankrupt. And so at what point is it too much now, things turned around. We made a big business out of it and it makes a cool story when it works. Everybody in Vegas that's been there long enough has a great story about when they bet hard and it worked. Every broker has a great story about a stock that they bet hard, took a chance and it worked, right? But most of them have a story where they lost everything,

Ryan Rutan: right. Unfortunately, it's usually after the success story, right? They're back to where they started again.

Wil Schroter: So, uh good friend, founder from last year and I I I could tell 100 of these stories just from last year, but he gets to a point where he's taken on gobs of debt. The point the where you start signing personally for debt because you have to because you're just out of choices that at that point and you sign assuming that. Yes, it's gonna suck. But I'll make it through. But those debts come due, those personal guarantees get called. And now all of a sudden those debt collectors, they're calling your parents, they're calling your loved ones trying to collect those debts. They're showing up at your house trying to collect those debts that happened. And now these folks, right founders like us are in such peril and you step back and you say wait a minute was going, this broke worth anything that it was gonna have benefited you. Because when you sign those notes and again, you're in a horrible place by the time you're signing those notes. But when you sign those notes, there has to be a limit switch that says, you know what, I really hope this works. But if it doesn't, I'm not willing to go that, that in debt like f that um there has to be a point where you just say no mas, it's

Ryan Rutan: so hard. I mean, this was, these were some of the conversations that I had last year. I mean, and they're still occurring, but last year was like the pinnacle of this out of all of the years we've been doing this and talking to founders, I never had to have this conversation more often and, and also, you know, in more dire straits than, than I'd ever seen before. People making decisions that I had never seen before because they wanted to see it out or they thought they wanted to see it out, they didn't want to see it out but they couldn't admit to themselves or to anybody else around them that it was time to just call the spade, the spade and, and be done with it. And it is really hard. Right. Because you don't know. Right. Because for every 100 of those stories I have, I have one where somebody was on that precipice and then shortly thereafter everything turned around. Right. And everybody's heard of one of these and I think this is part of the problem. Right. You just one more, just one more. Let me just let me, let me just go, let me see what they'll give me for my watch and I'll, I'll just double down and, you know, we'll put it all on, on 32 whatever. I mean, that's a number on the, on the roulette table. So it shows you how much I know about gambling, but it doesn't work. It doesn't, that's the problem.

Wil Schroter: Right. It consistently in putting yourself in financial peril because you might win later. Technically, you've already lost, you've guaranteed the loss and you've maybe gotten some upside. And I gotta tell you having gone through it personally, I wish someone could have pulled me aside and just said, stop doing this. Now that prevented me straight up from having the success that I had with that particular venture and it would have been worth it because at the, again, you don't know, but at the time, what it would have saved me, uh, because that could, that was one degree away from going totally different and ruining my entire life. So, so you've got, it, it helped me dramatically, but it could have also just as soon ruined my entire life,

Ryan Rutan: more likely, more likely that it would have been ruined your entire life. Right. I, I guaranteed at the moment you made those decisions. There were 100 204 100 other people making similar decisions that don't have the same story that you have now, right? We know this to be true. We often

Wil Schroter: don't realize at the time is we're so caught up in that. This has to be the way we make wealth. It has to be this thing. I'll give you some examples. So in the past year, it's been one of the greatest down round periods in like the history of startups. And for those that aren't familiar, a down round is when you raise at a lower valuation than you raised on your last round. So Ryan and I start a company we raise at $100 million. It sounds amazing. But then things go horribly in the next round we have to raise at $10 million which means the value of our stock just craters,

Ryan Rutan: makes everybody in the cap table super happy.

Wil Schroter: There's been more down rounds than ever. We've set the record in down runs, which means last year sucked. I say that to say you now have all of these founders that are looking at what it used to be, that $100 million and now they're looking at what it is, the $10 million. But in their minds, this is the only way they're ever gonna make money. And I say that to mean, they think that if I don't hold on to this and write it to the bottom of the ocean and again, I hope they all go great. This isn't, I mean, I'm not betting against that. I'm saying as being the founder friend, we have to tell you that we do something else start from zero. It's better than starting at negative 100

Ryan Rutan: negative 100. That's exactly it. Right. I think this was, this was a phrase that came up a couple of times in, in these conversations and it was, there's only one certainty here, right? You can lock in the losses, you can lock in the losses, you cannot lock in the win, right? You cannot lock in the win. If you're already in a losing position, you may dig yourself out. You might no way of me knowing that, right? I don't have a crystal ball that can help me tell that what I can tell you is if you sign on the line, you are locking in those losses and you will be liable for them. Right? And so we have to be super, super careful about saying like is it worth it? And why? Right. Is it because I don't want to go do anything else and I fully accept the risk or is it? I'm afraid that I'll never be able to do anything better than this again. And this is my one shot or that if I don't turn this around or I have to turn this around or my life is ruined, you're kind of guaranteeing that you're about to ruin your life if that's the way you're looking at this. And so this is where we got to be like super, super careful when we tip toe this line. Let's

Wil Schroter: say you're five years into the business and things didn't go well. Again, you're in down around situation or you burn through your cash or whatever my answer often is stop doing it, which at the time is heretical to hear it does, it,

Ryan Rutan: it feels awful and it feels awful to have somebody else tell you that even if you've already decided that in your deepest darkest chamber of your heart, it's the worst thing in the world to hear that from somebody else.

Wil Schroter: And yet it winds up being the most powerful thing you can do because you get to reset and reload it, go do something positive. I think when we get to that point. And again, this is often mirrors relationships like the, you know, the battered spouse, we forget that that's not normal. That, that behavior, that, that feeling you wake up every day in absolute misery isn't the way it's supposed to be. You don't have to do that. You can, you can choose every day to keep doing it and, and I won't pretend to outline everybody's situations. But the, the one thing that remains constant is that we do have a choice as to where we want to take things we can get off the train. Now. Sometimes it's harder than others. You know, I've been chained this stuff as well,

Ryan Rutan: man, how many the founders that we talk to, who have the equivalent of Stockholm syndrome, right? They are, they are in love with the thing that took them hostage and it's hard, right? It's really hard. This is why we need to hear it from somebody else. But to your point, then once they do hear that and they, they do the hard thing, it can be really freeing, right? And go on to do that other thing, right? You're walking around with a, you know, £500 anchor around your neck. You're not gonna get very far, right? It's not to say that just like, oh, well, yeah, just start quitting stuff and that's the key to victory also. Not that, but there has to be a point at which you say I've fallen, you know, afoul of the sunk cost fallacy. Something's gone on here where I've decided to start making bad decisions because things have gone poorly and I'm gonna make worse decisions to try to make up for that. It just doesn't work right. You just start to compound your losses, not dig yourself out of the hole.

Wil Schroter: And the key with that is just calling your limits. That's really what this is about. It's about looking at all the different categories that we talked about your health, your relationships, your wealth and saying what are my limits? And I think part of that is talking to those limits about those limits to other founders specifically saying this feels a little funky. What do you think? And you know what they're gonna tell you, get out, get out. They can't tell you with certain and listen, listen to what they're saying because often when we're in the middle of it, you said it so perfectly. The Stockholm syndrome, we can't see it. But the truth is if we communicate our limits and at least discuss the limits and where we're willing to go in each of these different categories, at least we stand a chance. So in addition to all the stuff related to founder groups, you've also got full access to everything on startups dot com that includes all of our education tracks which will be funding customer acquisition, even how to manage your monthly finances. They're so much stuff in there. All of our software including Biz plan for putting together detailed business plans and financials launch rock for attracting early customers and of course, fund for attracting investment capital. When you log into the startups dot com site, you'll find all of these resources available.

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