Startup Therapy Podcast

Episode #68


Ryan Rutan: Welcome back to the episode of the startup therapy podcast, This is Ryan Rutan joined as ever by Wil Schroder, my partner friend and startups dot com, Ceo and founder, uh today will, we are going to talk about something that I think as we often do, a lot of people get wrong or very confused about or maybe haven't even considered, um, and you know, we often talk about these things we want to achieve and how big we want to get, how much money we want to make and how rich we want to be. Um, and you know, you and I were kicking this around a few days ago and we said, you know, the notion first should really be like, how do I get safe? You know, before I, before I feel rich, how can I just start to feel safe, right? How can I, how can we take some of the fear out of the startups game. Um, and, and where is that threshold compared to the traditional feeling of, you know, monopoly man rich,

Wil Schroter: you know, it's interesting, it's like when, when you're younger and you didn't, you know, you hadn't been around long enough, you sort of had this concept that I need to make so much money that I never need to work again and, and then I will feel safe and I, you know, I hear that a lot, I had a lot of people saying, you know, I need to go big on this and it needs to be a huge exit so that you know, I never need to work again. And that argument used to make sense to me before again, I've been around long enough to understand that it makes no sense. Um because what people are often confusing is being rich and being safe, another was just like you're saying, Ryan, I think early on we thought being rich meant being safe, but there are actually two kinds of different things and, and don't get me wrong, like being safe is a richness into itself, but I don't think it's, it's as expensive as people think it is, I think safety can be had for a much lower threshold than being what we would consider to be rich and what I think would be kind of cool today is if we just start to explain to people because I think it's really important um, the difference in the two and how, if you're, if you're getting in your company or starting to develop your company, how really what you're looking for both the company and yourself is to establish a baseline to say, okay now I'm safe now, how do I become rich and you know what the distinction is and I gotta ask you if you think back to kind of personal journey milestones in your life, was there a moment where you can remember, hey, actually I'm kind of safe for a minute and like how it changed your thinking a bit, Yeah,

Ryan Rutan: yeah, there were, there were two, there were two that were kind of the most critical, Well, there were, there were several, but let me give you two that are, that are a bit different and um, and, and one is probably a lot more common for people. And I think that would be interesting to explore too. Uh, the first if we're going to go chronologically was back in the early two thousand's. Um, I did a very baby sail on on a digital agency and you know, by the time I, I paid out all of my friends who were also working for me at the time that I'd given equity to, Uh, you know, I ended up with something just over six figures and um, okay at 22 that felt like all the money in the world. I

Wil Schroter: was gonna say it's a billion dollars at 20

Ryan Rutan: two. It was, I mean like, it was like, yeah, like I had no, I had no college debt. I had, you know, I was, I was, I was free and clear to go and do what I wanted and I had this incredible sense of both safety and that, that was as much of a backstop as I could imagine. Like I couldn't think about based based on the fact that I've been running a startup and going to college at the same time. Um, to say that I lead a fairly uh tight lifestyle would be the grossest understatement of the year. Um right, So that was enough cash to last forever at my current run, right? Um but it, it allowed me then to, to make some, some decisions based on that perception of safety, right? I had a backstop and I felt like I could now go and pursue some things I wanted to do. Um which were to start to travel internationally and start businesses internationally, which I did both of. Um and it was, it was a ton of fun and and that essentially funded the next couple of businesses um and a second exit, which is great, right?

Wil Schroter: Just let me ask you though at that moment, ah how did you or did you, I shouldn't say, how did you feel safe? And, and did you feel rich? Um Again and we're looking at it. I'm going to distinguish safe is okay. I'm not like living huge, but I can get by, I can absorb a couple of storms.

Ryan Rutan: Yeah, that was, people never get

Wil Schroter: to that point.

Ryan Rutan: Yeah, I didn't, I certainly didn't feel rich, right? I definitely felt like I had enough money to do what I wanted to do for the foreseeable future at that point, right? Um but it wasn't like, Oh, I can retire now. I mean I got a little over $100,000. It wasn't like I was going to just, you know, well that's it. I'm done. I'm going to become a hermit on a mountainside in, who knows where? So now it was, it was really, it was the sense of safety and I mean having started the company very young and operated very young. Um, you know, there were a lot of scary things and so I felt safe in two ways, one that, you know, post exit and post the earn out. Um, all of those daily stresses and scary things that were happening to me went away. Um, but if we talk about, you know, the, the amount of money that, that was put on the table, that was really where most of the perception of safety came from because all the real challenges that point in my life were like, how do we pay the rent? How do we pay the staff? How do we pay that? Right? All that stuff and, and those went away for the time being just absolutely, we're no longer a concern. Um, which had that amazing, you know, freeing sensation and opened up my thinking again and let me just kind of, let's just go, let's go play, right, let's go, let's go figure out what we want to do next. Um, without any real pressure around the decision, which was awesome. It was such a great place to be in. Um, and again, like I think that did stem from a sense of safety, right? It was like, well I can't fail at least in the near term, right? I had enough to weather at least a couple of storms. I mean like, you know, at that point, big surprises for me at that stage, which is so funny to think back on now we're like Oh gosh, you know we forgot about this bill and it's like $250, right? You can have a lot of those kind of disasters with 100K. In the bank, right? It's not money forever. Um But it covers you for a lot of those little little incidental baby storms, right?

Wil Schroter: I was going to say that there's there's two pieces to there's there's being personally safe and there's being business safe right? You know, at some point the business had to get to a point where it was safe enough that it was gonna be around long enough so you could plan for it and then at some point hopefully you also became safe enough that you could kind of, you don't make your next bet.

Ryan Rutan: Yeah, that's exactly it. Right. And you know the the safety of the business has already been established at that point for about a year, right? We were doing well enough that at that point, you know, it had already been a good solid year where the the safety of the business was established enough and it's it's the agency world and you know what that looks like so it can it can ebb and flow in a moment's notice. Um But it felt stable enough and then at the point at which the acquisition happened, you know with a fairly short turnout of, of six months, uh, kind of more of a turnkey really than an earn out and it was by the time I entered that phase was like, well it's really owned by somebody else. So if the business fails, it's not really on me anymore. You know, salaries are being covered by, by the parent company at that point and all that. So, you know, there was, there was a strong degree of safety and so at that point, you know, the business was perfectly safe essentially out of my hands. Somebody else was, was a good shepherd at that point. And um, I just had to worry about my personal safety, which then came at the end of that six month period when the, the, the, the, the balance of the, the acquisition was paid out and all my friends got there, they're little checks and everybody was quite happy about that and, and feeling safe and you know, it's funny like, like going back, um, I remember the sense of safety that, that gave to to some of my friends as well right there, you know, they paid off things like their student debt or, you know, the rest of the car loan, um eliminated, you know, like whatever their biggest bill was. Um, and, and I remember we, we all did talk about at that time, you know, we were, we were young and dumb and so, you know, the context in which we just discussed, it was very different. Um, but there was this sense of movies that came over all of us, it was like, wow, We can, we can take a little bit of a breather and, and the time at which it came was great because I would say 75% of us graduated within that same like year to 18 month period, um, with just a few that were still in school and a few have had graduated prior to any of that happening. Um, so it was a nice time for all that to happen because you know, typically it's more of a high pressure time and so like the timing of that was great. So feeling safe in that moment, you know, right after graduation was, was quite different than what most of my peers were experiencing, which was the stress of trying to go find a job and deal with the boss and pay student debt and all that stuff. So yeah, it was very fortunate to have that at that time.

Wil Schroter: You touched on some interesting points there that I just want to kind of expand a bit, one of the things you talked about is you guys paid off debts, right, student loan debts, card debts, things like that. And one of the things that I think when we're first kind of getting the startups, getting their careers, whatever that we think about it, Like I want to be rich, so I don't have a student loan debt or I don't have a mortgage, I don't have, you know, um, of this and, and all of that makes sense. But if we start to really distill down what that really means

Ryan Rutan: and what it really costs

Wil Schroter: correct and that's, that's a lot of what we're going to talk about because when a lot of people are listening to this, they're thinking these guys are just talking about safety guys, we're not just talking about safety, We're talking about optimizing your approach to building a startup to be able to get to a minimum viable level where you can be safe so you can go become rich. See the whole point here is that I think when we combine the two, when we combine safety, I have enough that I can kind of weather storms with being rich, like I have enough that I can never have to work again and fly on a private jet. Those are two very different goals, right? It's the difference between trying to get on first base in, trying to hit a grand slam home run. Right? The problem is when we start with building our startup, we make all these decisions, We keep thinking so not everybody, but sometimes, um, I have to hit a grand slam home run, I've got to raise $100 million an exit for $10 billion and become Elon musk aside from the fact that statistically that's almost never going to happen. And I'm not knocking that goal, I'm saying take it in stages, Stage one, just get on base right. Stage one is have enough money that I'm okay, so that I can swing for the fences again, the problem is people combine those two goals. They say, oh, I'm not interested in, in just living, okay, I don't want to just be safe. I want to be fabulously wealthy.

Ryan Rutan: Well, I think even as people are listening now, I think that, you know, if you just follow logically, you can say, well, yeah, okay, but safety happens along the way to being rich. Um, but if we, if we reverse a couple of days and go back to last week's episode, one of the things we talked about was the fact that if the goal is to far out, then you're, you're, you're optimizing for this, this long range thing versus a short range thing, um, you're far less likely to achieve the short range thing and in turn achieve the long range thing as well. And so I think that that's, that's part of the conversation today, is that, yeah, being safe is a byproduct of being rich, but it's not necessarily a foregone conclusion that you're going to get rich, but you probably can get safe right? And so starting there and to your point that opens up the door much wider to actually achieve the, the longer term goals, dreams of expanding from safety to a point of wealth or, or being rich or whatever.

Wil Schroter: That's that's really well put, I like that, that you kind of recap on the fact that we say these comes come in stages. So what we're really talking about here is we're talking about milestones, right? We're saying that let's think about what safety looks like as a milestone. And frankly, if that's as far as we ever get with this business, that's not the worst place to be. But we'll also talk, we'll get to this later. But we'll also talk about how getting to that milestone allows you to become rich because you get to do things that other people don't get to do. You have the ability to swing for the fences and if you miss you're still okay because you've already gotten on base. But when I, when I really try to distill this with founders and I say, okay, let's just get to safety. What does safety look like for you consistently? I hear well, if I had 10 million in the bank, I'd feel safe, like no shit right, of course you'd be safe. Right. Um, But but then I, I push a little bit because this is such an important part because the probability of you getting 10 million in the bank is so incredibly low that I can't leave you as the founder, as that being your only choice to get out of this, right. Like I need to show you that there are other steps along the way in critical decisions that you can make as part of this journey to get on base and safe so that you can go to do those things and if you don't, you're not totally screwed. So we dig into how much money is safety and to do that. Uh, what I found Ryan is, I think we have to start with safety means you can weather a storm. What does the storm look like to you? Right? I'll give an example when you were saying you're 22 years old and you have to say $100,000, what do you think a storm was to you? What would that event maybe be and what would it cost you at that point? Oh man, it

Ryan Rutan: was things like, oh shit, tuition's due or

Wil Schroter: okay, sure

Ryan Rutan: there's an extra payroll period this month. Um, and rent is too, because it's always too right. It was, it was tiny little things, right? Or needing to go to the doctor and pay the exorbitant copay. It was, it was tiny little stuff at that point. Of course those things scale, right? I'm, we're a family of five now. Um, and so you know, all of those things, you know, my, my both my ability to weather a storm and what I consider a storm is very different than what I would have considered a storm then. Um, and, and so, but yeah, there's there's there's millions of little things, right? And it can be personal, it can be friends, family, it can be a lot of things that anything that taps into cash that you weren't expecting um is some sort of a storm.

Wil Schroter: I haven't had income for a year or maybe I want to start a startup. You know who the guest and I'm not going to make income for a couple of years. The point to all of this is those have numbers attached to them, right? And if we don't define those numbers, we tend to wind up with goals. That just don't make sense. For example, you know I was talking in terms of weight loss because it's just something that nobody understands. I weigh £180. If I were to say I need to lose £100 and be like, have you played that out for a second? You want to weigh £80. I was like, no, I just I need to lose a ton of weight. I don't have to worry about losing weight anymore. Right.

Ryan Rutan: That'll be enough to last me for the rest of my

Wil Schroter: life

Ryan Rutan: Which will be significantly shorter at £80.

Wil Schroter: Oh my God. Right. Right. When you don't have to find our goals, we want we wind up on this amorphous path that lacks definition and when it lacks definition, it lacks the the acuity to be able to say, I need to know what decision to make, that's most probable for this outcome. For example, if we were to say, you know, $100,000 in the bank. Um, which again, when people are listening, uh, you got to understand our listeners are all different stages in our lives. We've got, we've got listeners that spend $100,000 in a month and we have listeners that have never made $100,000 in a year and probably never will. Right? So again, we're trying to address a broad spectrum of folks here. Your mileage may vary, however, with $100,000 in the United States, there aren't that many problems that you can't absorb. Okay, so that's more safety net. That's like, well, damn, if, if I, you know, risk a bit and I get hit with something, I can probably absorb it. But let's ratchet it up a little bit. Let's say for $250,000. Are there that many problems that you couldn't absorb. Now let's say you make $150,000 a year, which is great salary. Um, and you're out of work for two years. That's, I mean, that's, that's net income, obviously that's, that's not gross income, that's about two years worth of income. That's a huge safety net, right? Here's, here's where things get a bit messed when, when founders here, like do I want to make $250,000 or, you know, $100,000. They tend to cheapen those goals at least publicly. They do because I don't, I think it doesn't sound like it has a lot of bravado to it to say, man, I would kill to have that much money in the bank. But behind closed doors when they look at $1,000 in their bank account, they're like, yeah, but you know, I really mind having that money.

Ryan Rutan: Right,

Wil Schroter: yep.

Ryan Rutan: Multiplying that by 250 would feel

Wil Schroter: pretty good. Well, so right. So I guess what I'm saying is within the startup narrative, I don't think there's a healthy and deliberate discussion about what safety really is and how damn important it is, both for the business and personally, although we're mostly talking personally to have and so If I were to look at um myself, let's say at 25 years old and I were to say what is the safety net look like and what would putting that much money in the bank allow me to achieve? Let's say that 25 years old, I wasn't married yet, didn't have kids. Um, if I had $100,000 in the bank at 25, I would still want to buy a house at some point. Uh, you know, I have my car payment etcetera. I would have been out of college, didn't have any student loans, You save a lot of money when you drop out and uh like beyond the uh not a lot of big expenses, which means I could make some pretty healthy swings at 100K. And the reason I bring that up is because for for all of us who are listening who build businesses for a living, a business that throws off 100 K. isn't inconceivable. And a lot of people look at that 100 K. Is nothing 100 K. Is a lot of money. If it means the difference between having it and not having it. Um And so early in my career I would have been insanely focused on getting to that milestone. And I would say look at 100 K. Here, all the problems that I'll be able to absorb. And I'd be very meticulous and when I say I would be I was I was very meticulous about this, about what problems I could endure and what problems I could not by being so explicit. It took a lot of the guessing off the table. In other words, at 100 K. I could say, you know what, there are only two problems that I can't withstand right now, right? Two years of unemployment and getting cancer right? You know, some some major kind of terminal type of cancer. But that's it. There's literally nothing else that I can't absorb right now. I don't hear people say exactly like that and I think it's really important,

Ryan Rutan: it's as you said earlier on, the mark gets overshot by such a, such an extent that it's almost ludicrous right? If, if 10 million is your mark and, and we can sort of objectively prove that $100,000 actually gives you a hell of a lot of safety. Then the mala alignment, there is critical right and, and, and to, to both of our points from earlier. Um, it changes the way you think it changes the way you act. Um, and it, it changes your optionality on, on a lot of things, right? If, you know, when, when we decided to come together and do stripes dot com had, you know, based on what we were paying ourselves early on. If we hadn't had a cushion, this wouldn't have worked right. There wouldn't have been a way to do this, right? And so, you know, having that the, the freedom and the safety net, um, allows you to do things you otherwise wouldn't be able to do. And

Wil Schroter: there's

Ryan Rutan: a lot to be said for that. You know, the, as I look at the way the, the opportunities in my life have stacked up. Um, it was always, you know, and obviously as you go further into this, the safety piece becomes more important, right? My tolerance for safety At 22 was very different than what it is now, I have much more to risk, right? Exponentially right? I'm now responsible for four lives that aren't mine, um, at a minimum, right? And I'm talking about just my family, not, not staff, not anybody else. Um and so, you know, the the perception of, of safety certainly changes over time and the desire to remain safe changes over time. Um but what's interesting is that the backstop still stays relative um to your life and your lifestyle and and those are fairly adjustable. So, you know, kind of, even at this stage, I would say that I would feel perfectly safe with, you know, between 100 and 6200 in the bank and I feel safe enough to take kind of whatever swing I need to write even at this stage with, with all that I have on the line. Yeah,

Wil Schroter: well, okay, so stick with that for a second though, we actually hit a few different milestones of safety first, it was a business going break, even then it was being able to pay ourselves so that, you know, we wouldn't be losing money. And then there was another step where we were starting to like make enough money that we could build our own nest eggs, you know, um on top of that. And when I say, we, I mean the whole company and so uh when we look at those milestones, they aren't the big milestones, everybody thinks they are, like everybody's thinking that's 10 50 $100 million. Those milestones we hit when we're at ones of millions of dollars, right? Like it was nowhere near what people think it is. And I think part of the problem is most people have never done this before, this is their first startup and likely their only startup. And so in their minds, they see, uh, companies raising a ton of money or company's hitting huge revenue milestones and they equate that with being big and safe. And the truth is funny because those companies are incredibly insolvent. Uh but for ourselves, if we, if we establish these real specific milestones and we say, look, job, one shortest path to getting the company on its own legs, because frankly if the company dies, we're going to go with it. So the companies to get established first, um, kind of like, you know, put on your own face mask before, before you put on someone else's, uh, the company is your first face mask. Um, and so the goal at that point is to say, cool, let's say we get to $20,000 a month in recurring revenue and that's just enough to keep the lights, on we're getting paid very little, but the company is gonna be around critical milestone because now that we know the company is going to be around, we can bet a little bit, because we have a little bit of variability in, in our own cash, right? Then we hit a next step where we're starting to pay ourselves and now our income is safe, like are consistent income, may not be as big as we want it to be. But it's consistent and we can rely on it, which creates a tremendous amount of safety, which is exactly what we did. Then the next step is now we're making a little bit of money. And this is where it gets really interesting. And this is sort of the turn in all of this. Now that we're safe. We can make bets without having to worry about being safe. And that's how you get rich. That's how the richest people get rich. Because Bill Gates can make massive bets that no one else can afford to make because they can afford to make them right. The rest of us can't the rest of us. If our stock portfolio goes to zero, we're screwed. We're done. Right.

Ryan Rutan: Yeah. Yeah. It's a big deal. Right? And I mean, that is a that's a huge feeling of safety, right? When all of a sudden that runway that was in front of you gets extended off to the vanishing Point. You can no longer see where the runway ends. That's a hell of a good feeling. Right? That's that is from a business standpoint. That's the safety that you're looking for. Right. Um Lots of revenue. Great new clients. Those things are wonderful. But they don't necessarily bring safety. Right? It's it's making that runway making the burn rate disappear. Um That becomes that that real first and and maybe permanent point of safety, right? Like that's the one that I think we always try to maintain. Uh it's it's the one that I stay focused on. And, you know, it feels great to be there. Like at that point, you know, what else you have to worry about, right? We can keep doing this. We haven't gotten it. All right yet. Right. And I think that's something else that's really important. Understand it's not that we nailed everything about the business and we've done it perfect. And now we're done executing. And all we have to do is just maintain that's not it at all. Right. We achieved safety well, before we achieved full success or or any kind of finality in this business, right? We may never we may keep working on this thing until we're, you know, fall out of our rocking chairs. I don't know. But we are at a point where we have achieved a significant level of safety for the business, which is fucking awesome.

Wil Schroter: You made a good point. But you said that um we made decisions based on that particular milestone. And I used consulting as an example. We've actually built a great consulting business since then. But that wasn't initially our goal are, you know, a goal was really a means to an end. It was actually a means to an end to get people to use our SAS product. Um but it wound up being a, you know, a great business into itself. The point is, we knew that the consulting business could get us faster to enough, they are are in order to keep ourselves afloat than the SAS business could. So we leaned really heavily on that, had, we just said, look, all that matters is growing the SAS business. We probably wouldn't have have taken that step because that wasn't our milestone. Um I think by isolating the milestone and focusing on just that, I think it really did dramatically change our focus and, and and ultimately the outcome, I would believe,

Ryan Rutan: Yeah, yeah. When you rely, when you rely on the outcome of the bet for your safety or for your longevity, that's the problem, right? At the point which you can start to bet that doesn't actually impact your safety. You're you're you're in a good spot before, before we move on, I want to back up on a, on a couple of things. You walked us through those milestones, I want it to be very, very apparent to everybody listening that those were highly deliberate, right? Those weren't like, oh we were just trying to grow the business as big as we could get it and those things happened along the way, that is not, that's not it, right? We specifically set out to achieve those as the milestones alright, because I, I really want to make sure that this doesn't slide by in the dark, we optimized for those things, we made decisions to achieve those things, you can say, well if you were just growing, wouldn't, that have happened? Absolutely not right. We could have, we could have gone for growth and we could have said, Hey, let's, let's keep risking, let's push this up to the point where we're spending every dime we make and then some, let's take on some debt, Let's do other things. Let's grow, grow, grow, grow, grow. That's not what we did. We very specifically and objectively set out to achieve those milestones to create that base level stability for the business, then the base level stability for the individuals. And then we got into into the growth phase.

Wil Schroter: Well, it pays off in ways that people may not realize we were able to make some bets some acquisitions actually early in the business, um, when we didn't have a ton of revenue with millions of revenue in revenue, which isn't zero, but it's, you know, not tens of millions of revenue that time. Um, and what was nice about those acquisitions, they were huge acquisitions. Right. But if they didn't work, we would have been okay and not because we were printing money. That wasn't it at all. It was because we had already gotten to our, our break even milestone for the business. So we knew that even if this new endeavor didn't work, it wasn't going to change our outcome. We're still gonna be around to figure it out after that huge, huge leverage point second, we're making just enough in the business that our own bills at home were paid,

Ryan Rutan: we get to keep coming back, we get to keep playing. Yeah, I mean, it wouldn't have felt great, but

Wil Schroter: exactly, exactly. Um, and so I think what, what if you folks get to see is the power of safety, the power of safety means, even if even if I know I can just withstand a small hit, it's more than other people can withstand. We knew as a business, it was such a powerful competitive advantage to be able to take a hit and look, I mean, if you look, you know, we're in the crowdfunding business, everyone in the crowd funding businesses gone. It's a bloodbath, right? We're like one of the very few companies left. Not because we're so amazing. I mean, we're, we're okay, I guess, but um, because all those other companies and they're all good people, by the way, I know a lot of the founders, I'm not knocking the founders or the companies, but they didn't have safety. Right? That one bet didn't work. And there was nothing to fall back on, right? And in that lack of safety became the death knell for all of them. Uh, and again, that's just crowdfunding is just one category that Sicilian others. It underscores though, how powerful, focusing on getting to that safe point, both personally and professionally, um, can fundamentally change the business. The other thing I would say, Ryan and I'm curious your thoughts here is we've now, while we've had short term goals, we've never had a short term focus, in other words, um we've always looked at the vision of the business and how we want to help entrepreneurs Instead. It's going to take 5, 10, 20 years to do what we're trying to do probably longer and we kind of knew because we hit safety that it will just take as long as it takes.

Ryan Rutan: No, it is, I mean, taking taking urgency off the table is is big and there's a couple of ways in which you do that. Yeah, I mean, the a lot of urgency is self inflicted, right? We make up reasons why things are urgent, things that need to happen faster than they actually do. Um but there are things that are urgent, right? Like payrolls pretty urgent, right? Not having enough cash to make it pretty urgent. Um so yeah, there there are a lot of things I think that when you get to that point of safety, you take urgency off the table. Um it allows you to to maintain focus and it's, you know, I can't believe I'm about to use this analogy, but in shooting a rifle, right, you have to focus on the front and rear sights at the same time, right? You gotta be able to see the long term, you will be able to see the target and you gotta be able to see both of your sites at the same time. Um, I would say that taking urgency off the table allows you to have that multilayered focus where you can say, okay, here's what we have to accomplish tomorrow, but I can still see in the background that longer term goal that I want to achieve, right, that target that I want to hit. Um, and, and I think that's really where having that level of safety, being able to say that, look, this bet we're about to make doesn't change things in a way that would cause us to have to fold their tents and go home, right? So knowing that we can start to make decisions that that aren't, you know, binary outcomes, right? Like we either survivor, we don't based on this decision, um, is so empowering and and allows you to actually achieve those later stage things. And I've already said that, but it's um, it's not for nothing that, you know, building and deliberately getting there is difficult enough, Right? And, and so there's no shame and aiming for that first point of stability first. Um, and then giving yourself the freedom and the relaxation, be able to go chase down the other stuff, right? Um, when you're constantly worried, constantly scared that you're not gonna make great decisions, you're not gonna feel good about the stuff you're doing and you should, right, There should be, it's not always fun. Um, but it should be, it could be fun more often then then I see a lot of founders going through simply because they don't focus on getting to that point and they're still running scared 34 or five years into the business because they keep hedging their bets too strongly or sorry, they're not hedging their bets enough.

Wil Schroter: Well, you know, interesting Ryan in all of this because we've been talking about safety. What we haven't talked about is being rich, right? We've talked about all this optionality that we've created and we, and we keep talking about it, which I think is very interesting in terms of like minimum viable income here. We keep talking about what's the minimum we needed to get to at the company to become safe, what's the minimum? We need to pay ourselves to become safe, etcetera. Um, at no point did we say that these life changing kind of monumental milestones were about becoming rich. So just for just for a second, I just want to point out that once you're safe becoming rich becomes a luxury goal, right? In other words, once you're safe, you're like, hey, you know, I've got enough cash in the bank where I can weather a couple of times, I'm not, I'm not rich, Rich has a different version for everybody. But, but if I were to give it just a little bit of, um, a little bit of character. I would say rich means I have the

Ryan Rutan: option to do things

Wil Schroter: without having to worry about the cost safe means I can play defense, I can absorb a cost if it comes my way rich I'm doing because I want to see if I'm doing because I have to, does that make sense? Right. And so in my mind, um, once in my life I knew that I was safe and I could start making bets that I could rebound from, uh, I was almost invariably going to become rich. I'm not saying it's, it's, it's going to happen to everybody. But I'm saying I had so many opportunities to make so many bets because I had some safety that eventually something was going to work despite me. And, and I think because most people never get to play with house money, they don't understand how powerful that is. And so what I would say is if you're thinking about your goals here again, both personally professionally with, with the business, first think about what do I need to get just enough to be safe so that I can make some really big bets and make those, the one that paid off, which by the way, those bets might be another startup. This startup might just be the means to be coming safe so I can go make other bets. I mean, which is kind of interesting to me

Ryan Rutan: that was exactly the cadence of, of my story, right? Which is that, you know that it's, it started with a series of small businesses that allowed me to have enough cash to build bigger ones and have the freedom to choose to build bigger ones. Um, Yeah, and, and so I think that's the, the other thing that ends up happening. Um, and I think this is one of these reasons that we, we do these like wildly outsized outcomes, you know, as, as targets. We forget that this isn't the only chance we're gonna get to play this game. If we want to write, you can keep doing this. It's like, um, if it's the only one you ever get to do and you're the only person who can decide that then and you need $10 billion and you're gonna get 10 billion of the first one, but the reality is, um, most of the founders I know are, you know, have have done multiple startups. Um, or multiple businesses, not all of them would qualify as startups in my book. Um, my first couple of businesses, I would not call startups at all. They were, they were businesses. Um, and so, you know, I think that we, we have to be careful there, um, in, in allowing like this to be like, of course we have to stay focused, we have to, we don't want to play shiny ball syndrome said, look, I'll just go do another one, I'll just go to another and I'll just go do another one, but, but the reality is you probably will, or you can, if you want or need to, um, and you can leverage a small outcome into a bigger one later. Right,

Wil Schroter: Let me talk about it in two ways bud. First. Uh, let's talk about the fact that maybe we're just talking about a milestone. You know, again, just like startups dot com, like our first milestone would just become safe and the next milestone happens to be the same company, but it's essentially another era, right? The second is I may be pursuing an opportunity. Uh, and I might say, well, that's never gonna make me rich, but if it's the fastest part to making you safe, you then get to spend the rest of your life worrying about getting rich while everyone else is trying to spend the rest of their life trying to

Ryan Rutan: get a

Wil Schroter: look. I mean, we're saying the same thing in a lot of different ways. What we think startups need to do, what founders need to do right now is just figure out exactly what safety looks like exactly what that minimum threshold is for for for cash, for productivity in the business, etcetera, and go all in on that so that we can spend the rest of our time actually becoming rich

Copyright © 2022 Startups.com LLC. All rights reserved.