Startup Therapy Podcast

Episode #94


Ryan Rutan: Welcome back to another episode of the startup therapy podcast. This is Ryan Rutan from startups dot com, joined by my partner Ceo and founder of startups dot com Wil schroder today, we're gonna be digging into a topic that hopefully will become german to just about everybody at some point. As, as founders, you've probably already made some money or I would imagine you're certainly hoping that you will. And so there's a few things we want to talk about today and that's like what actually happens to our relationships when we start to get wealthy and how do we prepare for these changes as founders? Well, you've probably been given some of the same sage advice that I think just about everybody gets from somebody who they know who's been through it before. And like most people, you probably ignored it, how how did

Wil Schroter: that play out? You nailed the ignored it part that's for sure.

Ryan Rutan: It's like most advice,

Wil Schroter: it was a perfect moment, It was such a hallmark moment. You know, I'm sitting there across from my business partner at the time and it's almost like he had lived generations beyond me. He was only four years older than me at the time, I think I was 22, he was 26, but his family, his dad had started a massive $50 billion company that might be $100 billion company now. And so he had grown up with wealth, he had actually seen it from scratching and kind of seeing the evolution and our company was starting to do well and I was starting to make a little bit of money and I was a poor kid making a little bit of money, so this was a big change for me and he told me something that I really wish I had listened to like many things in life and he said, look you've made a little bit of cash, but here's the thing, never ever tell anyone how much money you have, right? He says only two things will happen, they're, they're going to try to take it from you or they're going to size you up with it, but either way you will lose and I've never heard truer words now, so I took that sage like advice and I did the exact opposite, I put it in the trunk

Ryan Rutan: of a really new car, like

Wil Schroter: God, I think I bought like a red Lamborghini and told everyone that would listen, I mean I was an idiot and exactly what he said was going to happen, happened. Everyone I knew, everyone I knew came out of the woodwork right now, this is everything from relationships that I had from, you know, people who essentially said, oh well it's got some money, let me figure out how I can separate them with it or other folks that were just saying, oh I guess you're guy with money now, you know, kind of their version of go fund yourself or I've made more money than you have, don't think you're that special, but no matter where I turned everything changed?

Ryan Rutan: Once you start to be measured, it doesn't really matter where you land on the ruler. It still sucks right. Like it's just people are going to use it as a way to either, you know, turn their nose up, but you would turn their nose down at you. So yeah, your friends said either way you lose,

Wil Schroter: right? If if his advice was now go and do the dumbest things you can with this advice, that's exactly what I do. You were you

Ryan Rutan: Were 22. That's exactly what you do with every piece of advice. Every piece. So like, let's dig into something here though because like I think one of the things that we like to do on startup therapy is to make sure that we're really injecting how it made us feel so like in that moment because obviously you got that piece of advice and that didn't stick or didn't make you feel any particular way, it doesn't seem so you felt good at that time, right? You felt like you wanted to share these things with people, you felt like, you know, this was something that you would accomplished, you know, you were down and out kid made good and that does feel good, right? But you went from this good feeling. So as that started to change as you started to see these various judgments based on some maybe, you know less than superb behavior on your part. But that aside how did the feelings change and like was it sudden did it take time like the first time you know, somebody did that to you? Was it immediate or did it take some time to kind of pick up on? Oh sh it I shouldn't have done that.

Wil Schroter: Well. It's interesting too. And this is just going to date us a bit but it's also long before social media, damn near before the internet, but long before social media.

Ryan Rutan: So I had to travel via word of mouth.

Wil Schroter: Yeah you had like a phone call right? It was actually hard to do to work and apparently I did it but where I was thrown the most is I assumed that whatever success I had or whatever wealth I created only mattered to me right? That's the cardinal miss on all of this. Is that we assume that so long as we don't change that nothing else changes. And now mind you again, I was an idiot with it. And so I did change to some degree. And if you say like how I felt about it, I felt like I was a super poor kid that grew up on welfare that finally had validation for all the times I got shipped on as a kid right? It was exactly that right? It was a childish immature kind of response to something that had probably been haunting me subconsciously and consciously for most of my life. And so I looked at this opportunity as my kind of f you back to the world that kind of stuck it to me, which by the way, it never ends. Well, there's no version of that where there's a happy ending and so I was screwed going into it and it only got worse from there.

Ryan Rutan: So what did you start to do then at that point? Like, you know, it's out there, you know, you're starting to be judged, people know what's going on, How did this play out practically like when and where did the relationship start to change? Where did you feel it most acutely?

Wil Schroter: It's when I started to notice that people all had an agenda with me all of a sudden, everywhere I went right everywhere I went, someone clearly had some other conversation in mind that they were hoping to get to that involves separating me for money or providing some level of judgment around it. And it took me a long time to understand this. I don't know why it took me so long given that I was given specifically this advice that I ignored. But what happened was like, let's say with my relationships, friends, family, things like that all of a sudden, people were like, hey, I've got a bunch of life problems, you've got a bunch of money, why don't you solve those problems with that money? And actually here's how I thought about it. I was like, that sounds like a great idea. So I made the mistake and a lot of people are gonna like listen to this and haven't gone through this theater like wait it doesn't sound like a mistake. I made the mistake of writing those checks. I started to say oh you have that problem, oh well I couldn't make that problem go away. I remember what it was like to have that problem, here's money, make that go away. And at first everyone's high fiving me more validation right? And I'm like wow this is fantastic. Until I realized that once you break that seal, once you say oh it's okay to let me solve your problems with my money that never ends. You give somebody that a T. M. Card that never goes away. In fact it makes it 100 times worse. They feel like

Ryan Rutan: they know the pin now.

Wil Schroter: Well yeah but from that point on if you say no It's in stark contrast for having said Yes right? So now if someone comes to you and says I'm just making up a number, I borrowed $10,000 from you last time borrowed is a way to never get money back and now I could use 20 right? And these are big numbers. I mean relative to what people should be borrowing from you and you say no, they're like offended. Wait huh? What's so crazy is there is no going back from this once that the other Pandora's box is open, You cannot put it all back without massive cost. I get asked how did you see it? Like how was your journey through this different or was it? Yeah.

Ryan Rutan: So in a couple of places and you know it was interesting. So when I sold the first company, one of the things I did was write checks to all the people who were on that. Like the only team we when we started young and we you know wrote the business three years and then sold it. So it wasn't a particularly long period of time and the first year of it was really almost without any employee. So those people have really only been there for two years. So I wrote checks out to everybody that would have been equal to like something like I don't know probably on the magnitude of like a third to a half of what their annualized salary would have been so decent checks. Right?

Wil Schroter: Especially at that age. Yeah.

Ryan Rutan: At that age like some of these kids were still in college. I was, I had just graduated by the time I was doing this right, So decent size checks and most of them were originally received with a fair amount of gratitude and then something really interesting happened with a fair number of them then they wanted to start to compare each other's checks and then they wanted to compare that to what I kept And then they decided that because I kept more, they could probably come and ask me for things. And like these are people that I just handed, you know, like $30,000 to And they're like, Hey, you know, you know, if I could get like another, you know, 10 or 15 because remember that one time, like fucking kidding me right now, like no, that's not how this works at all. And like then somebody wanted to open the discussion around what my piece. It wasn't like you remember when we had the discussion around what your percentage was and you know, we used essentially a phantom equity structure. So there wasn't any real equity given, but there was an understanding that there was a certain pro rata on liquid event, right? Pretty common. And so I said, you know, that was the time to talk about this, right? When we agreed, you know what your market rate was and what we weren't paying you and so how we would make up for that with some of this equity, that's how this would play out. Like that was the time to have this conversation. We're not having it now that we've already sold and you've decided that this isn't enough money for you. So yeah, so that was where I really started to feel at first and it happened fairly quickly that this was within like weeks of writing the checks. These conversations start happening. It wasn't everyone right? I would say it was three or four out of the, you know, 15 people wasn't everybody. It doesn't need to be though. Honestly, it only took one once it happened with one. It really kind of shook me and gave me right. Nobody had given me that advice that you got. I also didn't tell anybody how much I kept her how much I sold the company for. So they were all just assuming and I think that some of them assume that you know, I was walking away with millions of dollars and and they got 40K. That wasn't the case, right? Did I take more off the table than the rest of them? Yeah. Had I been doing it for longer than rest of them? Yeah. We're their periods where I went out without salary where they had salary. Yeah. Did I invest the initial capital to serve the business? Yeah. Right. Right.

Wil Schroter: So all

Ryan Rutan: told, right, this is the way this is supposed to play out. But they had some issue with that. The other place that happened was very, very much like your case got approached by some family. My story ends a little differently and in my opinion a little more disappointingly I had a family member come to me and say, you know, times have gotten really tough and some things are happening within the family that are gonna force a move, which is going to mean changing jobs. And some other things like they were just really having a tough time had bought right at the peak of the market collapsed, they've gotta move, they've got to bring cash to close just to get out of this house so they can go be closer to family to take care of an elderly relative, right? So they're, they're trying to do good things generally speaking and hadn't really made any big mistakes, some bad circumstances. And so I thought, you know, he came to me and very humbly asked, you know if there was any way that, you know, I could potentially help out, you know, first, you know, and this is always funny now that I always, every time there's somebody asked me like, so how's the business going? Or you know, so things going well like, and I'm sure you do the same thing you're expecting there like that there's some agenda behind this question, right? I try not to let myself do that because it just starts to color all the conversations and I don't want to be like that, but definitely have become more defensive, but long story short, I'm thinking like, yeah, I could just give him some money to do this and I thought, but you know what would be nicer so that he doesn't feel beholden to me is if we did this more as a family? And I asked him first, I said would it be okay with you? You know, you want to keep this private or is it okay with you if I kind of take this to the family at large and we, we share this responsibility. And he said, sure. And so I took it to the family at large basically telling everybody that, look, I'm happy to do this and if you would like to contribute to that would be awesome. And I got crickets in a number of cases and some of my family actually got mad at me. A couple of them accused me of trying to show off and I'm thinking, oh my God, like how could this have gone as badly as it's going? And I just felt like shit, right? I was just trying to do right by a family member and make him feel well supported, right? So it wasn't just like I'm going to go to this one person I know who maybe has enough money to help me, but to feel like he had the support of the entire family and boy did that backfire because then he realized that he absolutely did not have the support of the entire family. I get called out and made to look like an asshole for asking everybody else. Um, and then I hear about all of their financial problems, like I've got kids in college, I've got this, I got

Wil Schroter: like, okay, I,

Ryan Rutan: all I said was like, if you'd like to participate in this, you know, feel free and what we were talking about was like relatively small amounts of money and doled out over a couple of months just to help them stay above water until they landed in the new location. So we're talking about relative peanuts. So yeah, it didn't end well. There's still a couple of uncles I don't talk to at this point because of this whole thing,

Wil Schroter: kind of no way around it, Ryan at its core. I think if we look at both of our situations and I think a lot of people can relate to this, what we probably overlooked going into this was that the money matters as much as we want to pretend at the time going into it, that hey, I've just got some extra cash, but it shouldn't affect anybody else because it's my money, not theirs and you know, it's my life, not theirs. It's a total total total misconception of how any of this works, We are judged by our money, whether we want to be or not or whether like, no, that doesn't happen in my world or not. Hopefully you live in the shangri la paradise where that doesn't happen, but for the rest of the world, it absolutely happens. And I think what's challenging again, going into this as we're used to life events where they generally only affect us personally, we're not used to life events that actually have this radiating effect with all the people around us and where we get kind of messed up heading into this, is that all of a sudden we have this life event in our case is you know, fairly early when we're still trying to figure out the world and all of a sudden all of these people are judging us and approaching us and creating these new relationships with us that we didn't have before and we're scratching our head going, what did I do wrong here? And in both our cases, we actually tried to help and it actually made it worse,

Ryan Rutan: paved with good intentions. I paid mine in a four lane highway. Apparently

Wil Schroter: it is. But listen man, every aspect of our society, right, has people judging other people. You know, you and I talk about this in previous episodes where we talk about just the level of emotion that comes off of scrolling through a social feed, right? Where everyone is constantly judging and evaluating themselves against everyone else and you almost always lose that battle.

Ryan Rutan: Yeah, you're measuring your entire life against somebody's instagram post, right? Which is crazy Lincoln time and edited in post.

Wil Schroter: But social didn't invent that it just exacerbated. That's absolutely we've been judging people by money since the dawn of money. And so having money implies a freedom of power, you know, all of these different things of security at its core that other people will feel that they don't have or conversely they'll feel like they have more and therefore, you know, they're worth more than all of these crazy things. But I think at its core where we get led astray going into this is the moment we think that the money doesn't matter or it only affects me. We're in for a very rude awakening. And if you have a wealth event, especially whether you like it or not, it doesn't matter how you change, it's how everyone else changes where this whole thing begins. That's where that advice came from. I didn't get it at the time. I certainly get it now. Yeah.

Ryan Rutan: Well, I think it's one of those things where it's it's easy enough to here, it's hard to absorb until you start taking the hits that result from that. And as you said, like, it's nearly impossible to be able to avoid the judgment. And so what are the outcomes beyond that? So beyond being judged, like what happens?

Wil Schroter: Right. Right. Let's talk about it in two categories. Actually, let's mirror the advice because the advice was pretty spot on and well earned. Category one, they'll want to take it from us. Category two, they'll judge us by it. Right? Let's unpack both of those because it's going to be one or the other and sometimes both. And so I think that it's worth some investigation. You know, let's dig a little bit deeper on each of those because again, I'm okay with beating a dead horse on this advice because it's so important. So, category one, right? They'll want to take it from us I'll give you an example of that? A couple of months ago we were asked to give to a charity, my wife and I, we wrote a check. We're not huge charity supporters, not, we don't dislike charity, it's just not kind of how we contribute, contribute in other ways. And we wrote the check. And you know what, I kept thinking in my back of my head, it's not enough. If I write a bigger check, it still wouldn't be enough. Again. This history plays out in my head over and over and over. There's this concept that once people know that you have something to give them, there's never a point where it's enough. And so that's a charity, This wonderful thing, right? You know, something that you couldn't, you couldn't think twice about wanting to support if you could. And yet it's not enough. And you start to realize there are a lot of relationships where there is a transactional nature there, especially if you're a founder. So I'll give you another example When I was fundraising, this is later on in life, maybe 10 years later and I was fundraising for my first funded company. I would go in and talk to investors to VCS, you have to talk about your history and kind of your success failures. What have you, that's part of who you are and part of the investment at some level. And invariably they would say, well, you had a big exit, how much are you putting in? And I'm thinking to myself, okay, so you're saying if I didn't have a big exit, you wouldn't ask that question. I don't have to put anything. But if I do have a big accent, I have to put money in,

Ryan Rutan: which tells you one thing very clearly has nothing to do with the calculus of making the investment and it's everything about measuring you against them.

Wil Schroter: Yes. Well, especially in the VC world because they actually are measured by numbers by finance. But there are also a special breed of folks that really like to size each other up by their bank accounts, not my thing, but whatever, but at the end of the day, they're literally saying, how much money do you have? So I can take it from you. It was not a thinly veiled right in other cases, right? Again, we're talking to the founders, we have team members, right? And they're saying, okay, I'm asking for a raise, let's say, and I see that you have a new car, you bought a new house or whatever. Hey, if you can have that, you can definitely afford to pay me more. And by the way, they're probably not wrong, Maybe actually, you know, everybody's company is different, but once again, there it is, right? You have this. So I want to take it from you, this isn't about these being bad people, they're just making a judgment call as to where that source of cash can come from. It's kind of that simple, you know what I mean? Yeah,

Ryan Rutan: I think it's a combination of two things and it's the, you know, the cash is there and then I think that by human nature, when we compare ourselves to other people, we want to be more more like them or better than they are right. Nobody wants to go like you are the three people I would like to feel lesser than right. Nobody has a list that sounds like that. And so I think one of the things that ends up happening is that they go, look, I'm here, I'm doing all the same things. I'm contributing to all this. This wouldn't exist without me. And I think that people can often overstate their contributions what we've talked about this before. And this is a big part of startup hiring and firing and setting career path for people. And so I think that's part of the problem that you end up with people looking at that and going, I did a lot to create that. Therefore I am entitled to some of that. It exists and it exists partially because of me. I think where it gets skewed as the, partially because of me like it turns into 50 60 70 80% of that is due to me when the reality is significantly smaller. They're also forgetting all of those other things. And I listed them off earlier, right. Which is I made the initial investments, right? I went without salary when you've always had yours. I've done a lot of other things. So it's not necessarily that this is just me always taking more a lot of times. It's this is just me re compensating myself for everything. I've gone without to get to this point where this excess does exist.

Wil Schroter: Absolutely. I mean, think about it this way, once people know how much you have, and I'll give you some examples of where that's some good comparisons to a founder Professional athletes when they sign a contract and they're 22 years old and they just joined the NFL and they just signed $100 million contract. Everyone knows exactly

Ryan Rutan: it's in the newspaper.

Wil Schroter: Yeah, yeah, it's right there now everyone knows exactly how much money they have. So everybody from financial planners to car dealers are hitting them up. You know, just trying to extract that money. But think about that, it's a target you paint on your back and if you choose to make that target bigger like I did, then that's on you, what we're suggesting here is try to make that target as small as possible because these outcomes, you know, what's going to happen here doesn't benefit you. Right, telling everybody how big the exit was or how much money you made is going to blow up on you. There's no way it works in your favor and for every small benefit you get, there's 100 negatives, you know, tim Ferriss talked about this when he talked about celebrity And he said you think it's great to have my total of eight million followers? Let me tell you what that celebrity actually buys me until

Ryan Rutan: you have to listen to the responses and the vitriol and the hate,

Wil Schroter: Oh my God, I remember like he actually wrote a great blog post about this maybe a year ago and he said there are eight million people in new york city. That's about how many people I have as followers. Think of how much crime happens on a percentage basis in new york city then think of how many of my followers aren't altogether there. And he started to list all of these scenarios of where his followers like just went crazy on. But my point is with a celebrity with tim painting a bigger and bigger target on his back as part of how he was building his brand. He was pointing out, he's like, I very rarely get a better seat at a restaurant, but I get harassed by people every single day, right? So he's like the R. O. I isn't quite what you think it is. And so when people have a big exit there thinking okay, there's this massive amount of validation, I want everyone to know how successful I am and they'll all love me and they'll all cheer me, it's actually just not true. What's going to happen is some number of them are going to figure you've got money? Let me try to separate you from it. Wait till you get called from every donor fundraiser there is then on the other side of it is they're going to judge you buy it in one of two ways. It's either going to look like this. Oh, you have a bunch of money. You must be an asshole, right? Which in my case was true or second I made way more money than you. You know, you're still not good enough. You're still

Ryan Rutan: an asshole. Yeah,

Wil Schroter: yeah. I'm still that asshole, right. Either way you lose. And so painting this target Ryan has been kind of one of the biggest challenges that folks that are, you know, making some cash for the first time don't really understand how to manage because I think at its core, they don't actually understand those consequences are real. You know what I mean? Yeah. Again, like

Ryan Rutan: until it's happened to you, you don't really have context for it and and for what it feels like and and how, how frustrating it can be. I mean, I went through frustration with your anger. I went through sadness and depression around the way that one scenario played out and then it has some lingering effects too. Like the fact that anybody asked me, you know, so how's business going? Did I assume that there's some follow up ask, right? And so, you know, it starts to color how I have these conversations with people and I don't like that, right? I don't want to assume that everybody is trying to take something from me, even if that is the reality and I don't want to, you know, downplay what we're building or what we've built and what we've accomplished simply to avoid the judgment. I mean, I wish it didn't exist. But on the other hand, I still want to be me now. I'm fairly low key about stuff. As a general rule, general personality is actually not a rule is just my personal, I'm generally fairly low key about this kind of stuff. So I don't have as much of an issue with it, I think is something like certainly not where it's like being publicly announced, right? Like so and so sold their company for, you know, 100 and $10 million right? And it's just literally in the news on social, everybody knows it or so. And so signed a contract with the patriots for X millions of dollars. There's no way to avoid that. But you know, I think for me, I try Not to paint the target or said differently. I'm just maybe I'm just not good at painting the target to begin with. Just my personality just doesn't lend itself to that. I think I've been a little more sheltered from some of this. And I also haven't sold a company for $110 million. I would like to try it to see what happens. See if I can get better at painting that target. But I'm still not quite at that point.

Wil Schroter: Well, a big part of this too is with the target is the moment money enters the equation at any kind of public level and public could just mean amongst your friends and family. Yeah, basically somebody other than you knows about it. You all of a sudden go under a microscope, money creates a microscope and here's what happens with that. Everything you do is now a reflection of that money, right? If you buy something that's super expensive. Oh, he's a rich guy. I guess he's he's buying stuff if you cheap out. If you don't buy dinner. Well dude, this guy made a ton of money. He could have bought dinner, right? Or just like I was giving an example earlier, like where my wife and I are writing a check, they have more money than that. They should be able to write a bigger check, right? All of this stuff doesn't exist until that target shows up, right? When I was 21 and I was broke, No one was asking me to write a check to a charity, right? And if I wrote $1, they would've been like, Oh my God, that's amazing, right? You know, that's so kind of you, right? But the moment they see that you have some level of means, there's a bunch of assumptions that come to it, right? When Jeff Bezos was running around prior to Amazon, No one gave a ship about what he did right now, Bezos can take a ship without everybody caring what he did, right? You know where he spends it, how he spends it. Every decision he makes is under a microscope, right? And that's because that level of success, that level of wealth has given people kind of the default feeling like they are allowed to cast this judgment because that cash exists. And again, I'm not knocking people for whether or not they make those judgments, I'm sure I've made a million of them myself, right? So I'm not beyond reproach on this, I'm just saying you can't ignore that it happens. You know what I

Ryan Rutan: mean? Ignore the impact that it will happen. You I remember this is probably a year and a half, two years ago, something nice that happened in our lives. And I was talking about it in front of a group of people not bragging, just, you know, talking about how like, you know, sort of resolved something and something else good had come out of it, not specifically to finance and somebody in the group just sort of huffed and said, must be nice. And I remember thinking like, what a kick in the balls, Like did I need that in this moment, like here I am. You know, you know, telling this this story about how, you know, we made good on something that wasn't good and we were feeling good about it and it must be nice, you know, I bit my tongue, but in that moment I wanted to lay out how, you know, actually, most of it really wasn't nice, right? Most of it sucked. It was a lot of work. It was a lot of stress. It was a lot of angst at the end, it blossomed into something good, but like you're jealous of that piece of it, but I guarantee you wouldn't have walked through the fire that I did to get there. So no, it's not nice. But yeah, I didn't say any of that, but boy, in the moment, I had lots of words, most of which aren't suitable for radio, um, that I

Wil Schroter: would have liked to have shared, but Ryan, build on that a little bit. I think that feeling is incredibly valid And I think it's the part of the folks that are on the other side of this, which in many cases, the majority of the people that are in our lives that they just don't understand. I'm not holding them faultless, so to speak. But I'm just being fair that you and I have been on the other side as well and there's a lot of stuff I didn't understand. For example, I didn't understand how people with money couldn't just give it away to everybody. Yeah, right? Like I just assumed that like if you have a ton of it and you're not spending it, then it's just sitting in a bank account, just give it to all the people that need it. And to be fair, some people do, right? And that's that's wonderful if they do, what I didn't understand was it wasn't my place as the person who didn't make it to determine where that money went. I mean, there's a lot of mirrors here in our political system right now. So I'll be careful about stepping on people's politics, but I just want to be clear like for the folks that are out there that have, you know, a wealth event, etcetera, Nobody's opinion of where that money should go means anything. Only yours that's right now. You can choose to agree with that opinion. And you know, it's cool if you do. But what folks from the outside don't understand is they don't get a say in it, but it won't stop them from saying it. Yeah, it won't

Ryan Rutan: stop them from trying. Yeah. They're still going to have their thoughts and their words about it. So what's the answer? Like what do we do? How do we insulate ourselves from this when the insulation fails? How do you deal in process with this stuff.

Wil Schroter: Well, let's dig back into when you and I fucked it all up and what we've done in the decades since. And so I would say a few things? I think it's the preventative would have been to just shut up about it, although that only gets you so far. But I think there's some other pieces to this. I think one of those pieces for me was to not be so ignorant and pretend like I'm not going to change so no one else is going to change so there shouldn't be a problem. We do not have control over this problem, right? We have what we can do. You know, we can be cool about it, not bring it up, do whatever we want to do, But that's not even half the equation. That's probably 10% of the equation. I think that's the part we miss. We think how we handle it is 90%. And then by virtue of that, the other 10% will kind of solve itself because we've been so cool about it. Sure doesn't work that way. It

Ryan Rutan: doesn't. It's funny because I have all these techniques, techniques like responses that are just sort of stock at this point. How's business? I really can't complain. Oh, so it's going really well. It's going well.

Wil Schroter: Yeah, how well

Ryan Rutan: as well right? They'll keep pushing and I'm just like, what are you doing here? Like what's next? Well I just hand you my Iphone, let me let me give them facial login first here, just open my bank accounts, take a look at our stripe account? You know, take a look at the

Wil Schroter: P and L, what is it that you

Ryan Rutan: like, where will it end? Like what what's your game here? Like what are you pushing towards? But it's amazing how even when you try to deflect, even to the point where you're getting fairly obvious that you are now deflecting that people will push and push and push and it blows my mind that that that that exists. And again like like you, I don't begrudge them. I understand curiosity is a natural thing, curiosity becomes even stronger if you have some need that you think that somebody else might be able to help you with but you want to find out for sure for kind of throwing your business out there, which by the way I've always found funny, right? So in most cases people don't come to me going, hey I'm having a big problem and here's what the problem is. I'm gonna quantify it for you. Here's what it would take to solve my problem. How well are you doing? And would that fit within your financial schema? No, they want to find out my financial situation and then if it meets their needs then they'll start to share before they put themselves out on blast right? I've always found that to be hysterically hypocritical but it happens.

Wil Schroter: Well actually Ryan, if you ever want to test that, tell them that things are going really bad and the company needs a ton of money and if they can help out, that'll be the shortest conversation you ever, hey, where you

Ryan Rutan: going? Hey, you didn't

Wil Schroter: even finish your again. You're asking, you know, what can we actually do about it? You know, what are the practical measures we can take? I would say the first measure is certainly being very honest and self aware of the fact that the money matters right in that no matter how we play it, there's no version where nothing happens. I think the second thing is, is to recognize that there are a lot of people who don't have it and that sounds obvious, right? But to your point you do have to curtail how you present it, right, How you talk about it, you have to be have some self awareness when you're in a conversation, here's a great example and I feel like such an a hole saying this, but I'm gonna say it About 15 years ago, I'm at a family event. I have a huge family of 80 cousins and someone was talking about how their car broke down and it was like $500 to fix. It I didn't say this directly, but I said this indirectly like Well that's nothing. I mean I broke the front end actually did on my Lamborghini was like $15,000 and I meant it as in like

Ryan Rutan: could have been worse. It could have been worse,

Wil Schroter: right? It is not how it was received, right,

Ryan Rutan: nope.

Wil Schroter: Here's the point. And Ryan you alluded to this,

Ryan Rutan: You just told him you could afford 30 of his repairs.

Wil Schroter: I didn't mean I didn't mean it that way. That's certainly how it was received. But it happened a million times. Right? And it got to the point to this day where I have to edit every single thing that I say because there's almost no version where I can just be fully honest about what I'm doing or how things are going etcetera. And I'll tell you this since then, I've met countless other founders who have made way way more money than I ever have or probably ever will. And they've all gone in full insulation mode. I mean they're all became hermits. They're so hard to get to to talk to. They don't socialize the way the rest of us do. They are very, very insulated and there's a reason for that, right? Because everywhere they go, someone is trying to get to them, so to speak and at some point you just don't want to do it anymore.

Ryan Rutan: There's an active population of seekers at that point, right? And it's, it's a very real thing. I had a friend just very, very recently go through a large exit and it was public. And so it was, it was quite obvious that he now had a lot more money than he used to have and a lot more money than most of the people that he knows, and you know, we had a, we had a very candid conversation around, you know, how awful it's been Not answering the phone, right? He's like, every time the phone rings now, it's shameless. Like people like, he hasn't talked to in 10 or 15 years coming out of the blue and he knows what's on the other end of that call, right? And so he's just not picking up the phone. He's like, it feels awful, but it feels worse to do it and then have to say no or to try to decide who to say yes to or to explain that. Like, look, that's not how this works, right again, to your point, Yeah, I I have this now, right? I spent the last 12 years of my life not having a life to make it, I'm not a charitable institution that's now just going to solve the problems that you've created, right? Like, you know, I would have happily given you advice to not do that thing that put you into financial dire straits, but I'm not going to give you the money to get you out of it, right? And so you're absolutely right. This is what starts to happen. You know, you start to become a hermit. You start to avoid the conversations or you kind of limit who you hang out with, right? We talked about this in a lot of ways as founders, that it's lonely at the top and this is just one example of that, but it's a pretty, pretty obvious one once you've been in that situation. And so yeah, avoiding this at all costs is good. So go back to that advice that we'll share it at the top of this. Um, and take it to

Wil Schroter: Heart. There was this interview, I remember that Howard Stern did like 20 years ago and someone was saying to him, hey, Howard, you're very public when you're in public on radio and everything, but you're very private when you're private. And we noticed you don't attend a lot of like industry events and things like that. And I remember he said something that was just so simple, just so incredibly honest. He said, I hate them because everybody tries to take from me. He said when I walk into a room, the moment I walk into a room, no one there says to themselves, Hey, there's Howard, let me try to make his day better. Right? They want a photo, They want to try to get me into some deal. They want to get money from me. They're like, everyone in the room wants to take. And incidentally they have nothing to give to me, right? And so imagine everywhere you went, everyone's hand was out and people's hands can be out in a lot of different ways. It's not always just about money. That ship gets old. It gets old after a while.

Ryan Rutan: Yeah, exactly.

Wil Schroter: And so all he was saying is, look it's it's not that I you know, I don't want to help people, but for me walking into a room is very different than most people walking into a room, right? Walking into a room for me is a liability. And I think what founders will understand over time when they have some sort of event like this is that a lot of their social events, relationships, things that they get into are actually liabilities. And here's the interesting thing if you've never had to say no to somebody asking you for something a lot of times or you never had to deal with the consequence of saying no, that's really what we're talking about, right? So if you're like, oh man, if my brother asked me for money, you know, FM Like, you know, I don't care, I'm just gonna say no, okay, that sounds cool to say I guess try doing it, try losing your relationship with your brother, your sister, your cousin, your mom, your dad. All because there are consequences to the word no for you that no one else has, right? Because the expectation is that you're going to say yes, right? And I think what people fail to understand is that the R. O. Y. For presenting how much cash you have or your big exit, it sounds like everywhere you're going to go, it's going to be a nonstop high five fist, your whole arm is going to be tired from high fiving so many times from so many people that tell you that they love you. That's not true. That's not how this ends. What happens is For everyone. High five, you're gonna get 100 kicks in the stomach, right? And that's what tim Ferriss was saying. The Ry isn't what you think it is. He's like for every time I get seated at like a preferential place in a restaurant, I get 100 death threats right from other people, Right? It's like the R. O. I just isn't there. So at its core. Never ever, ever tell people how much money you have. Mm hmm.

Ryan Rutan: That's a wrap for this episode of the startup therapy podcast. This is Ryan Rutan on behalf of my partner Wil Schroder and all the startups dot com Family thanking you for joining us and we hope you'll continue to join us. Be sure to subscribe rate and comment on itunes or wherever you love to listen to startup therapy, you can find all of our episodes at startups dot com slash podcast. If you're looking for more amazing resources to launch or grow your startup, be sure to head to startups dot com and check out startups unlimited. It's everything we have to offer from our online university to our amazing community of experts and founders and even all the tools we've built like biz plan fungible and launch rock. It's everything a founder needs visit startups dot com slash begin that startups dot com slash b e g i n. You'll thank me later. Mhm.

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