The market for your startup matters
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Justin:This is the behind the scenes story of building a web app in 2019. I'm Justin Jackson, and my cofounder, John Buda, is away this week. And so I thought I would call up my friend, Spencer Fry, to talk about building a web app in 2019. He's been building podia.com, but really he's been doing this startup thing for a long time. I think about 15 years.
Justin:And so I just wanted to get on Skype and ask him some of the hard questions I always have going around in my brain. I think you're going to get a ton out of it. Yeah. Let's get into it right now. Hey, Spencer.
Justin:How's it going?
Speaker 2:It's going well. Enjoying the nice, sunny weather in New York finally.
Justin:Yeah. Is it sunnier there now?
Speaker 2:Yeah. I mean, we had just a very gloomy winter where it was cold all the time, and the last few days has been have been, like, amazing. So Yeah. Super pumped.
Justin:Just for folks who might not know you, do you wanna give, like, a quick kind of this is what I've been up to the last 5 years?
Speaker 2:Sure. So even dating back further than that, in the last, like, 15 years, I've run a bunch of different, Internet startups. And then the last one I've been working on is podia.com for, like, the last 4 or 5 years now. And Wait.
Justin:Hold up. Hold up. How do you pronounce it? How do you pronounce it?
Speaker 2:Podia.
Justin:Podia.
Speaker 2:Yeah. So it's the plural form of podium. So podia.
Justin:Because I always I always just say podia.
Speaker 2:Yeah. I mean, it's both. Like, you know, whatever whatever suits you.
Justin:Podia.
Speaker 2:Podia.
Justin:Alright. Okay. Continue. Just just that this is also a pronunciation podcast, so I like I like to I like to flag those.
Speaker 2:Yeah. So I mean, Podia Podia, you know, tomato tomato sort of thing. But, yeah, we're so we're a digital storefront, for content creators like yourself. You're one of our first customers ever. Dating back almost 3 years now.
Speaker 2:Has it been
Justin:have you been around 3 years already?
Speaker 2:Well, it's, technically started it in September 2014. So we're actually almost at 5 years, but the 1st year were just me playing around with things. So
Justin:Is that when you were that that was when you were a coach?
Speaker 2:Yeah. Yeah. For so the furthest for the first actual 3 years of the business, we were coach, because our target market was more, tutors and coaches. And we started with online courses. Yeah.
Speaker 2:But since then, we've we've added downloads and memberships, and we're building around this kind of digital storefront concept. Mhmm. And our whole customer base has shifted from tutors and coaches, which we didn't really have that many of, to all different types of content creators. So, in December 2016 so wait. 2017.
Speaker 2:Sorry. September 2000 or sorry. December 2017, we switched the name to Podia to kinda better reflect reflect the customer base we had.
Justin:Yeah. And before that, you I remember you trying something with employee perks or something.
Speaker 2:Yeah. Yeah. Yeah. I mean, that was one of those, I don't ever wanna get into b to b SaaS businesses things. Okay.
Speaker 2:So, yeah, I I the brief story there the quick story there is, I started this company called Uncover, before Podia, which was basically where I was learning to code. I had done a little computer science in college. Like, I was a CS major for the first two and a half years. And then with uncover, I was like, I wanna get back to coding. So I was building some tools around HR and, because of my limited skill set, I knew that I kinda pick something that was sort of simpler.
Speaker 2:So we were doing, like, a perks and rewards system platform for employers. And we actually had a bunch of, like, big brands using it, which was really scary for me as the only developer. But I wasn't actually really that happy with it. It was you know, I was having to sell into companies, like, talk talk to HR departments and so on. So I ended up selling the company about 18 months into it, into, this Las Vegas company that owns, like, 25 different SaaS businesses.
Speaker 2:And that was like Yeah.
Justin:This is actually kind of what I wanted to dig into first because I think a lot of folks and you can even dig into more of your history as we we discuss this. But a lot of folks are looking for their their idea. Right? They wanna start a SaaS company, and they're just looking for an opportunity. And you've done a bunch of things over the years.
Justin:What do you think like, what what is the secret to finding a good idea?
Speaker 2:Mhmm. So, this actually just came to me as you're talking. But I actually think the interesting thing is finding a customer you like working with first. Not necessarily like a actual customer, but really, like, almost like a persona. So going back, a few startups ago, I ran this company called Carbon Made, which was, like, the first online portfolio for artists and designers to display their work online.
Speaker 2:And I just really fell in love with that customer base. So when I was starting Podia, I was like, I wanna get back to working with content creators because those are the types of people that, like, I really jibe with. So it kinda started from there, but I really like this idea that just came up with. It's like finding a customer profile that you like working with, because I really didn't like working with the, HR folks over at this kind of big b to b businesses, but I've always liked working with individuals and especially people that were looking to kinda create things.
Justin:Yeah. And so how do you balance that with just, like, finding a market that has good fundamentals? Was there a did did you have a checklist? Like, okay. It must be a group I like working with, and it must meet some other criteria criteria or Mhmm.
Speaker 2:Yeah. I mean, especially with Podia's, like, I knew there was a customer that I I wanted to work with, but I also wanted to work in a big market again. It's there's something about a big market that excites me just because, one, it tends to be easier to find people and and really define problems, with a big market. So when there's a big market, there's a lot of room for a lot of different competitors, but there's also a lot of problems that need solving. So I've always looked for big markets that also had customers, that I liked except for that one blip in my kind of CV with, the HR company.
Justin:Yeah. Yeah. Because, I mean, on its face, that seems like a great company to start. On it was called uncover.
Speaker 2:Yeah.
Justin:Because the market seems big. Right? How many, you know, forward thinking companies are there that wanna have perks programs or, you know, additional benefits for their their employees that it seems like there would be tons of those folks.
Speaker 2:I think there were. It was just very difficult to sell into. Mhmm. Especially as, like, a company of 1. Yeah.
Speaker 2:Yeah. Me, working on that. Also learning to code and doing all the sales and a lot of the design and all the customer support. And it was just tough, especially working with the customer base that I wasn't super, like, pumped for.
Jon:Mhmm.
Justin:Yeah. It it's I think this is the hard part that I find it's just difficult to communicate this to folks. Because market like, when you're talking about a market, there's all these factors that I think make a good market. But sometimes it's hard to, articulate what all those factors are. So like you said, it's gonna it has to be big.
Justin:But how did you kinda quantify that with Podia, for example? Like, how did you decide, okay, this is big enough for me to focus on that group?
Speaker 2:I mean, I think part of it was just seeing a lot of the trends in creator monetization happening. And a lot of the things that I was looking on at 4 or 5 years ago was how a lot of creators were having issues with, making money online because ads ad revenue wasn't working for them anymore. And I saw some shift towards, selling products, so selling digital products as, downloads. And then, you know, the online course market started to hit too. So now here's a second way for creators to sell content.
Speaker 2:And then more recently in the last few years, we've also seen this, rise in memberships. So there's all these different ways for creators to make money that was no longer ads. So another thing that I look at in a market is not only is it big, but is it also, starting to blossom? And I think the creator market was really starting to grow, and I think we're just at the 1%, of where it will be. But that's also the another, like, exciting part of the market puzzle for me when I'm figuring everything out.
Speaker 2:Mhmm.
Justin:Yeah. So you had you're kind of observing and taking mental notes. And what are the kinds of things you would notice? Like, would you notice conversations in a coffee shop or articles in the New York Times? Like, what are some of what's what constitutes evidence in a situation like that?
Speaker 2:Well, I I mean, Target was just seeing people like you and and other friends I had, selling online. So, like, you, Nathan Barry, others, just kinda getting into, selling digital products. So a lot if a lot of smart people are are seeing this as, like, a new revenue stream, I think that's always an opportunity. Yeah. And then also just on Twitter, you know, seeing more people saying, like, hey, check out this, ebook.
Speaker 2:It's really helped me learn programming or something like that. So also seeing it from that perspective. Yeah. And then, one of my friends was a, founder of Skillshare, so I got to sort of see the online course market start to grow, and they actually also or he actually also invested, in Podia as well.
Justin:Oh, interesting. So it's
Speaker 2:just it was always around me. Yeah. And then the I always forget this, but my dad who's, English professor at Yale, he actually just retired. He was one of the biggest, get one of the biggest online courses, on YouTube with, like, millions of views, where they kind of came and recorded his course or his class, I guess I should say, and put it up on YouTube. And it became super, super popular.
Speaker 2:So even my dad who is, like, old, English professor type guy Yeah. Was also, doing online courses online. So just starting to see it all come together.
Justin:Yeah. There was some momentum there. Because that's the other part that's hard to sometimes for me to communicate to folks. Like, how do you know something's kind of happening? You know?
Justin:How do you know something's starting to blossom like you said? How do you know that something's starting to grow or that there's still growth left in a a specific thing? And so much of it is just anecdotal kind of qualitative observations. And I think especially for folks that really want kind of quantifiable metrics, like, okay, I want to see that. You you know, something's going here.
Justin:It's sometimes hard to find that kinda hard data. Like, okay. Yeah. There's definitely, you know, online, like, digital downloads for independent creators. Like, you know, there's no, there's not a lot of hard data about what's going on in that field.
Justin:Right?
Speaker 2:Yeah. Totally. And, you know, it's it's funny when we talk to our investors and when we were first kind of fundraising back in the day, not many of them asked us about the market size because it was just sort of, almost like a gut thing. Like, everyone who was sort of in the tech communities, whatever, could kinda feel the momentum of the content creator space growing. You can't always put numbers behind it.
Speaker 2:Like, you can't I I don't even know how many content creators there are. And, you know, we do a lot of, analysis around this sort of thing. But a lot of it is also just gut and talking to people and, kind of sort of fleshing it out in your own mind.
Justin:Mhmm. Yeah. And I think this is where you kinda have to be somewhat embedded in the space. Like you just mentioned 3 points of contact and I'm sure there were more. You said, you know, I had friends that were starting to sell ebooks and courses online.
Justin:That's huge. I had a friend that also ran one of the biggest marketplaces for courses online. And then my dad also had, you know, this course that was taking off online. And if you don't have connections in a given market, I would almost say like, don't go after that market yet because you almost need that behind the scenes, like, you know, peek behind the curtain, like what's really going on here. And if you can't see that stuff, if you don't know that stuff, I mean, I would be I would be scared to take a risk on something like that if I didn't, like, actually, you know, if I hadn't seen behind the scenes for, you know, my friends or other people I knew or or something.
Speaker 2:Yeah. Yeah. No. Totally.
Justin:And this is why I often tell folks, maybe don't go after a market where you don't know anybody, like in the HR space.
Speaker 2:Yep.
Justin:You know, maybe if you'd had more contacts in the HR space, you wouldn't have started it in the first place. Right?
Speaker 2:Yep. In which I actually didn't know a single person in HR. So
Justin:Yeah. I I think it's a good litmus test. Like, how many folks do you know in that space that you're talking to that are sharing things? The, the one thing I've been trying to, I guess, kind of reveal more and more is that most of my insights come from what I call the back channels of the internet, Which is like private DMs, private Slack groups, you know, little conferences or meetups that I go to where people talk, you know, kinda off the record. Like, okay, here's what's really going on.
Justin:And when you get that insight, that's kind of what drives, you know, any kind of innovation you're going to have or the direction you end up taking with the product. Do you, can you think of anything like that that made you, especially with, Podia that made you feel like, okay, we're going to go this way because I'm seeing some things right now that, you know, maybe no one else knows or other folks aren't taking note of.
Speaker 2:Yeah. I think, you know, specifically talk to some friends and seeing their successes. You know, some numbers they might not mention online, but they would talk to talk to me about it, at conferences and stuff like that. I think I went to, what's that conference I saw you at, MicroConf? MicroConf.
Speaker 2:Yeah. I think 2016 or 17 and just talking to people there, about it. That was really helpful. And, obviously, my friend being, you know, a founder at Skillshare, seeing sort of some of the results that they were seeing. But one thing that I was I wanted to comment on too is that one thing that I really like is there used to be this sort of mentality around investors investing in, like, founder market fit.
Speaker 2:And now it's, like, almost reversed into this, like, market founder fit. Like, have a great have a great market and then a founder who really, like, loves and understands, that market and invest in them rather than just, like, a founder who's, like, found a market. And that's something I've really felt that, like, both Carbonmade and Podia is, like, I just, like, love these people. I love this market, and the market's big. And that's really helps me kind of be more successful.
Justin:And and maybe explain the nuance of that a little bit more. Like, what's the difference between founder market fit and market founder fit?
Speaker 2:So from what I gather anyway, like, founder of market fit is more like, is this person a great founder and have they, discovered a market? Whereas, like, market founder fit is like, is this a great market? And then, that the founder has discovered. So it's, like, putting more weight on one than the other.
Justin:Yeah. Market first.
Speaker 2:Yeah. Yeah. Because the the truth is, obviously, you wanna have a great market. You wanna have a great founder. You wanna have a great team.
Speaker 2:You know, you wanna have a great product and so on. Mhmm. But if you have a, like, a great market that's, like, large and growing, you can always, as a founder, figure figure out the rest. You know, maybe what you initially started with in this market is not great, but then over the 1st year, you've talked to, like, a 1000 customers and now you understand exactly what you need to build in and how to grow the product. So that's something that I, like, really agree with, especially in 2019 where it's so hard to kinda get product traction.
Jon:Mhmm.
Justin:Yeah. It's this is something I think about a lot right now because, you know, with transistor, we can feel it. We can feel like this, like, podcasting, especially, like, for businesses, it's growing and it's almost as if, you know, I think this is hard for folks to, to get their head around. You know, you might be great at product. You might be great at design.
Justin:You might be great at marketing. You might be doing everything right. But if you're in a market that's growing super slow or you're in a market where it's just not that big, like you've, you've kind of hit like, the saturation point has already been hit. It's going to be so much harder to get, traction.
Speaker 2:Yeah. You don't have any room for error. You know? It's like it's tough.
Justin:And so and in some ways, this
Helen:gives me a lot of
Justin:anxiety because I can feel it's growing right now. And, you know, maybe the the fear I have is I really hope we can, capture this interest. While it's still here? Because there is a little bit of a sense and maybe you have this with Podia too, but, you know, often the the folks that are there, the companies that are there in the growth phase of a market, they end up being the ones who are number 1 or number 2 or number 3. Right?
Justin:Like, if if you can if you can be there when a market is growing, that that really sets a good foundation for the future. Yeah.
Jon:Do
Justin:you feel any of that?
Speaker 2:Yeah. I mean, we feel like we are right in line with that. But it's it's definitely something that you can try to time, but it's really tough. You know, you wanna survive long enough to get to that point. Mhmm.
Speaker 2:You know, I I always tell entrepreneurs who who I talk to like being persistent is for me the most important thing, and just getting slogging it out and getting to that point where, like, luck starts to play a factor and some of that market timing stuff is luck. Mhmm. Like, for example, with Carbon Made, you know, we were doing well. You know, I think we're doing, like, as as a bootstrap company, we're doing something like 20, 25 k MRR. You know, we're fine.
Speaker 2:There was just 3 of us.
Jon:Mhmm.
Speaker 2:And then 2,008, market crash hit, and we had all, designers and creative people that were out of jobs and needed a portfolio. And within, like, 6 months, we blew up, like, quadrupled revenue, and it just skyrocketed. But there was no way for us to kinda predict that market change. But we were just there long enough to see it, which is super, super, like, valuable.
Justin:Yeah. How do you because because that's good advice. But on on the flip side, I would say, well but if you were persistently pushing in the wrong direction Yep. Obviously, you're not going to, you know, that's not gonna work. So how do you know?
Justin:What are the checks and balances you have for knowing when you're pushing in the right direction?
Speaker 2:So, I mean, obviously, you don't wanna be persistently doing the wrong thing. You know, like, you need to, be more persistent in sort of discovering what the right thing is. Yeah. And I mean, this is super cliche at this point, you know, talking to your customers. But in 2,000, I think it was 17, and this is not a joke.
Speaker 2:I talked to over 4,000 customers, and include and that's including live chat. So that's not, you know, phone call with everyone. But if it wasn't for that and it wasn't for me being persistent and talking to all these people and really kind of iterating the product, like, you saw it. You're a customer. Mhmm.
Speaker 2:You know, we we change things, like, every week and just continue to make it better. We removed so many things. We improved so many things. And we just try to, stay on track and stay, evolving and listening and editing and etcetera. And that's kind of how I think about persistence.
Speaker 2:It's not just like, or finding, you know, what part of that bigger market you're in.
Justin:Yeah. And this is actually kind of the the tough love truth that's that's also difficult to communicate to folks. Because folks will say, well, I've tried to talk to customers or potential customers, but I can't get a hold of anybody. Like, no one will talk to me. And generally to me, I'm like, oh, that's either indicative of 2 things.
Justin:1, you're just not very good at networking and communication and all that kind of stuff. 2, you haven't built enough relationships or built up enough trust inside of that market. Like, you don't have like, not it's basically how many people do you know in that market and how many people know you in that market? And if there's not a big number, then it's going to be difficult to have those conversations. And then the third, I guess I said to you, but the third would be you're in a market where there's just not that much momentum.
Justin:Like, one of the things that helped you was you launched Podia, and there's enough people out searching for solutions that they just showed up on your doorstep in the little intercom chat widget, and then all of a sudden you can have a conversation with them. Right?
Speaker 2:Yep. Yeah. Exactly. And even before that too, when I was still sort of, you know, almost like pre well, yeah, pre prototype basically. I actually used Craigslist and I contacted because we were focusing more around coaches and tutors.
Speaker 2:Mhmm. And I found, like, all the coaches and tutors in
Jon:New
Speaker 2:York City. Oh, wow. And, yeah. And I contacted them on, on Craigslist. And I actually had probably a half a dozen or so come by my office, and they were happy to chat with me.
Speaker 2:I was like, I'll buy you a coffee. Come by. Like, let's chat. Mhmm. So you can kind of artificially find customers through crisis potentially.
Justin:Yeah. Oh, and this is the hard truth. Is that if you've got nothing now, people always think that something magical happens in the future. And then, you know, you you get to a certain point and then folks just magically appear. If it's hard to reach people now for a phone call or, you know, a chat or anything, it it doesn't get easier in the future.
Justin:That means something is wrong fundamentally now and in the future. Like there's something not going right either. Again, no one knows who you are or you don't know anybody. You're just not very good at seeking folks out or this market isn't very good. And there's not very much momentum in it.
Justin:And it's better to realize that now before you build something than later, nothing's going to magically happen. And I think this is what frustrates people is, you know, they'll go, like, let's take Adam Wathan, who's a friend of ours. You know, people go, how is he doing so good in the program programming education space? Right? Like he's written a couple of books.
Justin:And the truth is a lot of people knew who he was before he launched anything. He knew a lot of the right people before he launched anything. And he was in a market that had an incredible number of people already in motion, already looking for the kinds of topics he was talking about. Well, that makes things Yeah. That that means he's going to have a lot more success because there's there's just so much, you can see the momentum.
Justin:Right? But and you must see this with creators all the time because you've seen who's successful and maybe who's not as successful. Does it kind of follow those those characteristics? Or is there something I've missed?
Speaker 2:No. It does. I think for for, a lot of people. But we've certainly seen people that had nothing when they when they first signed up with us. And then, it took them a year or so.
Speaker 2:And so they got, like, their first sale. Like, one guy come comes to mind, and he was super close to churning. I remember talking to him. Mhmm. And then, he got, like, his first sale for, like, $150 or whatever it was.
Speaker 2:And then now he's doing, like, consistent 5 figures a month. Or a month. I'm sorry. 5 figures a a year, I should say. But he went from nothing, 1st full year into something.
Speaker 2:And that's again, like, some of the persistent stuff I talked about. He changed his strategy around. Like, he started offering some more free downloads. He started doing more, like, YouTube videos, that kind of thing. And he just sort of began to build his following.
Speaker 2:But, again, he was also building into a market that wanted what he was offering too.
Justin:So Yeah. That really is the key. And what I love about actually, what I love about what Podia offers is, especially for people who wanna build software, what a great way to test something out. Because software, like, trust me with Transistor, most of what I'm doing every day and most of what people really are paying for is me giving them advice about podcasting. That's that's most of what that's most of what they actually need is I just need to know how to launch a show, how to get it into iTunes, how to make my website look good, how to format my show notes, how to, you know, create good audio.
Justin:That's what they need. And, yeah, Transistor is going to help you in a in a software sense get that done. But I can figure out how much momentum there is in a market without building software. I could create a book or a course or do a workshop before I do anything. And you're serving the same customer, but all of a sudden you're seeing how much momentum is there here.
Justin:How hard is it to get them to buy a $39 ebook? Well, if it's if it's super hard and it takes me a year before I get my first sale, Maybe, you know, there's something wrong here and I shouldn't invest a bunch of money and time in building software before, you know, before I do that. Like, start with something like a course or an ebook or something. And this isn't for everybody, but I think there are situations where that makes sense. And then a natural iteration on that is to say, okay.
Justin:Well, now I'm gonna build a tool that helps you do this.
Speaker 2:Yep. I I mean, I can see that working for quite a few people.
Justin:Before moving on, I want to talk about our sponsor, Balsamiq, again. Some listeners have asked me, why should I pay for Balsamiq when I already have other design tools like Sketch, Figma, Adobe XD? So I asked Paldy, and he this is what he told me. He said, first of all, people should use whatever tools work best for them. You know, many people use Balsamiq alongside other tools like Sketch or Figma.
Justin:The truth is Balsamiq just wants to help you with the ideation phase, which is the most important phase of any project. When you first have an idea and you need to iterate on it quickly and move it from your brain to paper, that's what Balsamiq is for. Other tools will let you customize icons, gradients, the roundness of corners. And before you know it, you'll be wasting a bunch of time caring about all these high fidelity details. And you'll lose track of that original idea, that thing that spark you had in your brain.
Justin:In balsamic, you can't do any of that. You can't get lost in the weeds. It forces you to stay focused and it just doesn't get in the way. Go to balsamic.com. That's balsamic.com.
Justin:Try it out. See how it feels. For me, it's like it's actually fun to use. It it makes me like the process of starting a new idea. Balsamic.com.
Justin:Can you give us an example of something that you figured out on a phone call or in a chat that you ended up building into the product?
Speaker 2:I mean, there's there's, like, really there's really small things. Like, you know, I wanna love Podia, but it doesn't do x. That's, that's always, you know, one that I think about a lot. Especially when you have someone who's like at a at a, 2 thumbs up and you wanna give them you wanna get that 3rd thumbs up. Mhmm.
Speaker 2:Yeah. That's that's always like a good area for me to focus on because it's like, alright. Here's a great customer that likes what we're doing, but they want to love it.
Justin:Yeah. So that's That's actually that would be a great, you know, either using NPS or, like, net promoter score or even, like, just sending your customers an email saying, hey. Rate us out of 5 stars. And if they rate you 3, have an automated reply that says, okay. We want you like, what would it take for you to love us?
Justin:And then just even start the sentence. I want to love Podia or Transistor, but and then just give them a text box. I love that idea.
Speaker 2:We we do something a little bit like that. Not exactly frame that way. But at the, on January 1st, we sent an email to all of our paying customers and asking them to choose one feature that would make them super excited for us to add in 2019. Mhmm. So it's it's not framed that way, which maybe I'll actually change that for next year.
Speaker 2:Yeah. But it does always give us, like, a really good sense of that, like, yearning to do like, feature to what I need to do with I wanted to do this. Mhmm. So that's always been very helpful. We also do, NPS Net Promoter Score stuff and I still contact everyone personally, who gives us a score of, 7 or under.
Speaker 2:Okay. And I just try to learn, like, hey, like, you know, what are you looking to do that we we're not currently doing great or whatever. And that's why it's been really helpful.
Justin:Yeah. I and I think that's scary too is, you know, asking folks to rate your software.
Speaker 2:Yeah. Yeah. Totally.
Justin:What's been your experience with that? Would you say that everybody should be doing that Or, you know because it is scary. Like, you're working on this every day. And, you know, part of me is someone who's making stuff. I just wanna protect myself.
Justin:Yeah. So how what, you know, what's it like? Is it is it does sometimes, does it hurt? Or, like, what's what's your kinda reaction to bad bad reviews?
Speaker 2:We've been very fortunate in that, you know, we get an overwhelmingly positive, number of reviews, but that that actually almost hurts. Or if someone gives you, you know, like, a low score, like a 3 or a 4, you know, like, oh my god. What did I do? Mhmm. Sometimes it's, you know, a bad product customer fit.
Speaker 2:You know, that customer was looking for something we just don't do and we would never will do. Yeah. But that's that's also a good opportunity to kind of learn and weed out the customers that aren't working for you.
Justin:Mhmm.
Speaker 2:But I think what hurts the most, honestly, I think are like the sixes and sevens. Those are the ones that hurt the most because those are people that really wanna make it work for you. But then the nines and the tens are always really bright, parts of my day. You know? Especially, I share all of our, promoter reviews in our Slack channel.
Speaker 2:And it's a great way for, like, the team to see the feedback. So, you know, when we get a 10 and they say the customer support team rocks and shout out to Veronica or something like that, you know, it also makes Veronica stay too.
Justin:Yeah. Yeah. That's good. You've decided to raise money. Are are you allowed to say how much you've raised so far?
Speaker 2:I don't know if I can technically say, but a few $1,000,000.
Justin:Okay. So you've raised a few million. Was there, like, why did you decide to do that as opposed to bootstrapping?
Speaker 2:Great question. So another, relationship story. So I've always bootstrapped, my businesses. So Car Remade and before that, Type Rag. And, with Podia, I was planning on bootstrapping it.
Speaker 2:So the 1st year of the business, it was all me and and my own capital. I think I invested, like, 30 k of my own money, and I didn't take a salary. So, and I used that money for kinda contractors. And then about about a year into the business, a friend of mine was like, hey. You should meet this guy Nick, in Brooklyn.
Speaker 2:Like, he has a small, VC firm, and he invests in kind of known as pre seed companies, and that's kinda where we were. And I was like, alright. Well, I'm not interested in taking money, but, like, let's chat. And then, we actually met at, like, a this is so Brooklyn. We met, like, outdoor beer hall in Brooklyn and had a beer and, like, a pretzel, and we just got to know each other for about, an hour and a half.
Speaker 2:And then, it was really up until the end of the meeting when I showed him what we're working on and kinda started to talk to him about it. And then, like, 2 days later, he was like, hey. I don't know if you're interested in raising money, but, like, here's a term sheet. And are you interested? And I just thought about it more.
Speaker 2:And I was like, I really wanna do all these things. Like, I want to hire this contractor full time. I wanna hire another person. Like, I really wanna kinda go for it. And fundraising felt like the only, way I could kinda do it more quickly.
Justin:Yeah. Yeah. Yeah. And and it's it's good. Again, it's almost like hiring.
Justin:Like, if if you first try it without, like, you do the job yourself on your own, you know, self funding it. But then as that list, you know, you had that list of things you needed to do got bigger. And you're like, okay. How am I gonna do this? Then the idea was, okay, well, the only way to accomplish this is going to be additional capital.
Justin:And so then it makes more sense to do it when it's when you're really kind of in pain.
Speaker 2:Yeah. Which we which we were. You know? I I was at that point, a year into the business, I was like, we have something here. I really just need people.
Speaker 2:I need bodies. Like, I need brains. I need I need help. And Nick offered us, you know, investment and then we took it and the rest is kinda history. But another thing I always I always mention too is I was very, very pro bootstrap and I still am, but I think you really have to look at the kind of business you wanna build.
Speaker 2:Like, are you the type of entrepreneur? And and I was forever. I was happy with, like, a small team and just, you know, owning every facet of the business, or do you want to sort of, like, quote, unquote go for it? Mhmm. And I think, you know, I just turned 35 yesterday.
Speaker 2:Oh, wow. Thank you. I'm getting older. And I think at the time a few years ago, I was like, you know what? I wanna try this other way.
Speaker 2:I bootstrapped for 10 years. I want to hire the best people. I wanna pay them, like, good salaries, and I want to try to build a big product and team.
Justin:Mhmm. Yeah. Does that does that stress you out though? Like, the the idea because you you've raised and I'm assuming, like, you're, you know, you're you're burning all that capital. Like, you're spending it.
Justin:Is there do you feel like there's this time clock? Like, okay. We've got to hit this by this date? Or did it give you like, did it stress you out more taking money? Or did it relieve your stress?
Speaker 2:So, great question. So I think, initially, it relieved a lot of my stress for the 1st year or so. Then and then when you start to kind of see some revenue come in and you're and you're growing revenue, And then I think at that point, then it sort of increased my trust where it's like, how do we grow faster? That kind of thing.
Justin:Yeah.
Speaker 2:But then once you hit, you know, the revenue goals consistently for 18 months, 2 years, like, which we have, you you start to no longer be stressed. And it's actually more comfort than stress because you have these great investors. Like, we have an insanely good board of directors. You know, Damian Atkinson, who's the CEO of Squarespace for 5 years, is on our board. And we just, you know, these are all these things that we wouldn't have done if we hadn't raised money.
Speaker 2:Mhmm. So the stress I'd say is gone from my life. At least the stress from raising money versus bootstrapping.
Justin:Yeah. And is that just because, you know I mean, it's one thing to hit, like, targets, like, revenue targets. But is that just because you know okay. Eventually, this is going to be a self sustaining company. Like, we have enough revenue coming in to pay all of our employees and all of our costs.
Justin:Like, you you were able to see that already?
Speaker 2:Yeah. I think that's part of it. But also, I think as you kind of build relationships with your investors over, you know, years. So, you know, most of these investors that I work with, they've been investors since the beginning. So like 4 years ago.
Speaker 2:You start to understand their personalities and, who they are and what they're looking for and their, their interest in you and their interest in their product and their interest in, like, your success. And I think, as long as you have great investors, then you never really have to worry about, them doing something crazy. Mhmm. I guess. Yeah.
Speaker 2:Which they can't do legally. But, you know, I've heard horror stories from other people with, like, terrible board meetings and terrible investors and and and so on. But we're fortunate to not have that problem.
Justin:The is that just because you've you've only sold a certain amount of equity?
Speaker 2:I think that's part of it. But I think also a lot of it has to do with, like, your terms outside of just the percentage of the company you give away. You know, like, your who controls the board, you know, how many seats are on the board, other things like liquidation preferences and just like all the other meat of the contract. But we're we're super fortunate with, like, every investor we've worked with where they've always been kind of founder friendly terms. And so yeah.
Speaker 2:So so we haven't had to worry about that sort of thing.
Justin:And what's the because this kinda brings up a good, maybe, final question which is, like, how does that all of that play into the end game for you personally? Because I think a lot of times we forget why we're even doing this, you know. And so for you, like, raising money and building this company, do you have, an end game in mind or a kind of, or just, I guess, a lifestyle that you're aiming for?
Speaker 2:That is funny because, I think about this maybe, like, once a year. And I was actually just recently thinking about this a couple weeks ago. And I think, especially with this company, it's definitely the happiest I've ever been as an entrepreneur. Like, I love my I love my team. I love my products.
Speaker 2:I love our customers, like, a lot. And, you know, I would be happy to work on this for another 20 years. You know, I'm I'm 35 now. Maybe I retire at 55, 60, whatever that is. And the great thing about our investors is none of them pressures us, to sell, to IPO, or whatever.
Speaker 2:You know, we've had some of our investors say, like, hey. Maybe you run this company for the rest of your life. And I'm like, yeah. That sounds good. So, again, I think it depends on the investors you have.
Speaker 2:But all I can say is, like, I really love running this company. It's, the thing I I love the most after my girlfriend. Yeah. And I don't.
Justin:Well, that's great. Yeah. I think that's such an important and that that's definitely something I wanna keep in mind too is, you know, sometimes we we, subscribe to a religion without even thinking about it. Like, oh, I've got a bootstrap. I'm a bootstrapper.
Justin:And you're making yourself miserable. Like, you're just not getting anything out of building the company that you wanted to get out. And, I think there is something to that of, like, okay. What do I want? I wanna run this company for another 20, 30 years.
Justin:Okay. If that's true, what do I need in order to do that? And and maybe, you know, taking money would add a way more stress to your life, which, you know, you gotta figure that out. But if it if there's a chance that taking money could reduce your stress and could add, you know, a bunch of team members that you really like working with and could help you, you know, move faster and, you know, capture more of that market, maybe it's worth doing.
Speaker 2:Yeah. And that was the case for me too because I knew that I like to work. I I knew I liked working in this market and with these customers and on the product really early on, so within the 1st year. So I I knew that raising money was actually a way for me to increase the longevity of me being able to work on this thing than if I would said just say just bootstrap it.
Justin:Yeah. I think that is that is important. And that's something that John and I are even trying to, like, ask ourselves over and over again. Like, okay. What do we want out of this?
Justin:And are we are we heading in that direction? Because if we're miserable, you know, there's gonna be some misery and pain when you're building anything. But if it's just non stop misery, or it's misery that you don't need. Like sometimes we like invite all this misery we don't need into our lives, where the journey itself is enough pain already. Like, why are you making that's Jason Cohen's big thing.
Justin:It's like, this is already hard. Why are you making it harder? And I think there's some wisdom to that.
Speaker 2:Yeah. And and one other thing on that too is, I think as you age, like, both as an entrepreneur and as a person, if you can identify the things that really make you happy as entrepreneur, you should stick to that for as long as you can. So, like, with the HR thing, not happy. Let me get out of that. With Podia, super, super, super happy.
Speaker 2:Let me continue to do that for as long as I can. And And I think a lot of people will, like, sell too early or they'll kind of even if they're happy, they'll be like, woah. Like, I'm happy, but, you know, the next thing's gonna be even shinier. But oftentimes, the next thing is not.
Jon:Mhmm.
Speaker 2:And so if you find something you really like, you should stick to it.
Justin:Yeah. Yeah. That's good advice. Hey, Spencer. Thanks so much for joining me today.
Speaker 2:Thank you.
Justin:Folks, you can check out Spencer. He's on Twitter at Spencer Fry. He also has a good blog. His his latest post, doubling down on your strengths. That's at spencerfry.com.
Justin:I really enjoyed that one. Actually, you should write more because every time you you you post something, I'm like, oh, yeah. Spencer's really kinda nailing something I've thought about.
Speaker 2:Yeah. It's funny because, usually, like, I write a blog post in my brain, and then I write actually write the blog post in under half an hour because it's already it's just, like, has to come out of me. So I have a few.
Justin:Yeah. You just gotta sit down and definitely check out podiaorpodia.com. Thanks so much for listening to my chat with Spencer. Before we go, I wanna say what's up to our Patreon supporters. New this week, Corey Hanes.
Justin:What's up, Corey? Michael Sitver, Paul Jarvis, and Jack Ellis, Dan Buddha, Darby Frey, Samori Augusto, Dave Young, Brad from Canada, Kevin Markham, Sammy Shukert. What's up, Sammy? Dan Erickson, Mike Walker, Adam Duvander, Dave Junta Junta. And, we've got kylefox@getrewardful.com.
Justin:Clubhouse.io. Go to clubhouse.io/build. And, of course, Pelti and Balsamic. Thanks so much, and we will see you next week.
