Startup Therapy Podcast

Episode #246


Ryan Rutan: Welcome back to another episode of the start up therapy podcast. This is Ryan Tan from start ups.com joined as always by my friend, the founder and CEO of Start ups.com will Schroeder. Well, we recently did an episode pure heresy where we talked about just building a business that makes money and that, that's ok. We got some feedback from that. And I think that one of the things that people latched on to was well, like, but how much, you know, I've got a little bit of revenue but like, it's not really making money, is it? So why don't we break that down because everybody's thinking big numbers. And I think that what we're gonna do today is point out that actually relatively small numbers matter in this game they do.

Wil Schroter: And, you know, it's interesting about that. I think when I was first starting, like, build my first business, I pictured like it has to be doing millions in revenue to be meaningful. Not because like my expectations were there. I just, that's what I heard that businesses do. I just didn't know any better. And then all of a sudden when I got my own business, I started to realize like the 1st $1000 that I make matters like it didn't sound like a lot. You don't make the cover of Forbes back then for doing that kind of revenue. But what I started to learn, uh as we've talked to, you know, hundreds of thousands of start ups since then, it's that first few $1000. And, and today we're gonna talk about a number around $10,000. That is actually the most important point of the evolution of every business and the $10,000 is a bit arbitrary and we'll talk about that, but that first milestone that keeps the business alive before it keeps us alive. That just keeps the business going month, over month, over month. It's kind of the most important milestone you ever get to from a revenue

Ryan Rutan: standpoint 100% right? It's that the 0 to 1 moments are so important in, in starter plan, right? We go from not having anything to having something, whether that's revenue, product team, whatever it is, they're huge moments. They don't seem like it. And like when you look back or like you're comparing it to something else, it doesn't seem that significant. And it's funny that you said that about, you know, thinking it had to be millions and millions of dollars. I had a very similar feeling. I, I didn't really have a number in mind. I just knew it needed to be big and bigger. The irony of that was. And I've told this story on the podcast before, you know, but my first agency started as a result of a chance encounter. It led to me making $500. And I was like, well, that's a meaningful amount of money for us for what was relatively a little bit of work. Let's do more of that. And yet somehow I went from $500 to, it needed to be $50 million with, you know, overnight. It's like, well, now it's a business so now it has to be big. Right.

Wil Schroter: Yeah. And here's where, you know, I want folks to understand folks that have been building businesses for a long time. You know, serial entrepreneurs that listen to this podcast, they're gonna be not along because they've been there. Right. We've got the benefit of having gone through this whole, uh, gauntlet and understood exactly how important that moment was. But this is really for the folks that are going through this for the first time that are like, yeah, thing is only doing like $2000 in revenue, like, and feeling like maybe they're failing at something. And this is that pause moment, like, no, you understand that first few $1000 is the business. It's the most important money you'll ever make. And ideally a little bit more than that. Right. But that first I'm gonna call it 0 to $10,000 is where 90% of start ups, never get two. That's it. That's exactly it. I think that's, it's missing in a lot of places. Right. It's so

Ryan Rutan: hard because people start to measure against that relative scale of the companies that are doing billions or now, you know, there's, there's companies hitting the, the trillion dollar market and market cap and people are comparing it to that and they're like, but I have so far to go, what they don't understand is that this is what greases the rails to allow you to get that far, right? And you had to get here first, right? Nobody started with 10 billion in revenue, right? They started with 2000 in revenue or whatever it was. And this first dollars in are so important and to your point, the vast majority of companies never get to that point. They don't get customer one in the door. Right. It's counter intuitive because you only look around at like your competition, you look around at the other businesses that are doing well. Sure. For every one of those, there are several 100 that didn't get to that point. And so I don't think that we can overemphasize how important it is just to get to that milestone, right? A dollar in, tells you so much about a business because when you don't have that, it's also a very specific answer about your business. If you haven't got to ren

Wil Schroter: at all, I had this survival instinct when I first got started in the business and all the business had to do was allow me to survive. Again. My, my expectations were insanely low. This is before getting, you know, hype up podcasts and Gary Veed into like, you know, grind economy and everything like it was just, you know, it would be cool. And this is my number. My number at 19 years old was $550. If my business could just generate $550 was exactly how much money I needed to live to put that in perspective. My rent, which was by far my biggest expense because I didn't own a car was $250 you know, $500 rent between me and my, my roommate, right? And then after that, like my electric bill was like $28. I mean, insanely cheap, you know, cost of living at the time and all I ate were like kraft macaroni and cheese, right? Like boxed macaroni and cheese or whatever. So that was like 25 cents a box. So

Ryan Rutan: like I was gonna say, man, I remember, I remember finding those four for a dollar ramen noodles. The ramen diet was a real

Wil Schroter: thing and I was perfectly ok with it. By the way, I, I wasn't like, oh my God, I can't eat better. I'm like, yeah, this is kind of just makes sense. It's what you eat.

Ryan Rutan: The price is right? Super easy to make.

Wil Schroter: Right. Right. But what I didn't, you know, again, I wasn't far enough along in my career yet. What I didn't understand was how valuable, understanding that milestone and just getting there and what we'll talk about today is actually even before that moment. So let's first lay out two critical milestones and we'll talk about kind of the, you know, progression. The first milestone is how much do we need to make so that the business can exist even if we can't. Right. So what does that mean? Well, maybe we have a hosting bill, maybe we spend a little bit money of money. In ad words, maybe we spend, you know, maybe we have a physical product. So the cost to maybe store the physical product, right? Baseline costs which just say even if we can't operate the business on a regular basis and get paid for it, the business itself won't go out of business. It's a part of the adventure and part of the growth that a lot of first time founders don't understand. They just assume the first milestone is when sure the business can pay its bills, but it can pay me. No, that is the second milestone, right? First milestones of business just stays alive. The second milestone, ideally, we stay alive with it.

Ryan Rutan: Yeah, I can go back in time and I guess if we adjust for inflation that probably lands pretty close to that 10-K number in terms of, well, actually that would have provided some business survival and some mis and of course, it depends on the type of business that you're building at the time. You know, my expenses, right. By the time my expenses were quite minimal, I was also at university, I was employing a bunch of people who were in university and so they were very inexpensive resources mostly because it was just a little time here and there, right? You know, I wasn't, I wasn't paying fully loaded salaries and benefits. It was just, you know, we were just scrapping it together and making it work. I'm gonna struggle to remember the exact number. I could probably dig up the document somewhere, but it was somewhere around like 6500. And we had hit this number in revenue like for four months in a row on average, right? If I average out the last four months and it came out to that. And I remember at that point thinking, ok, this is now amazingly stacking up a little bit of cash in the company accounts. So there's a bit of a buffer there more than covering the expenses. And I can now afford to start actually paying myself a regular salary as opposed to a distribution here or there again, just to keep my lights on. So it was extremely meaningful, right? Like I remember looking at that and thinking like at that point, I did celebrate, I celebrated the hell out of that finally got to a point where like now I can see doing this on an ongoing basis. It took away, you know, that little man running out in front of me building more runway month by month just ahead of us and allowed me to say like, look, I don't have to about that part. Now I can think about what that next milestone, the next milestone

Wil Schroter: look like. And everybody's number is gonna be different. You know, in, in this episode, we're talking about, you know, $10,000 per month is that, you know, first milestone. Now your number may be totally different, maybe higher, maybe lower. But what we are talking about is the number at which the business can survive even if we can't be running it at the time. Ok? So first let's just talk about why that number fluctuates or kind of, you know, what we're trying to optimize for because the milestone really matters and understanding the value of the milestone really matters. So what we're talking about at at a high level, we're saying, what's the absolute minimum the business needs just to keep running? Ok. So again, I would lump in things like depending on the business, your web hosting bill, right? Like your basic ad words, budget or your marketing budget if you have one just to keep enough customers coming in to generate revenue. Yeah, I would

Ryan Rutan: say think of anything anything that if you took it out, it would cripple the machine, right. Like you can take the leather seats out of your car. Right. You can do a lot of things, but if you take off two of the tires, you're done, right. That stops moving. So these are the kind of costs that we're talking about. These are things there. If you were to remove any one of them, it would critically injure the business and, and impede it from being able to function at any level.

Wil Schroter: You bet. And I'm gonna call those existential costs, right? This is the absolute minimum. By the way, even if the business isn't like doing anything, even the business is entirely coasting, which it probably will for a while. That's, and we're gonna get to that later. This is enough to say that it's just not turned off. Ok. Now, my number has varied over the years depending on where I was and what my costs were and what the businesses costs were yet, every business is a little bit different. But I think over time across nine companies, I started to understand this concept. So well, that I would build a plan like a go to market just for this milestone. Now, what's cool about that is like it's way more

Ryan Rutan: achievable. Stick on this for a second, right? This is important. Well, this is super important because I think this is one of the things where you and I talk to lots of founders and we look at the financial plans and do they ever reference that point clearly?

Wil Schroter: No, no,

Ryan Rutan: they don't. They aim way beyond that. And I think the thing that's really, they don't understand it's important and they don't understand it's important to have a plan specifically to build to that because what we do to get to a million in revenue might be something very, uh, it will be something very different than what we need to get to 10,000. And so when you build your plan around that, you're less likely to get to it. If you can focus on this milestone, that we're talking about your existential cost covered, then you can begin to write that second level of a plan, but it has to look very different, right? What we do to take the beach looks very different than what we do to conquer the

Wil Schroter: land. Absolutely. Absolutely. And we talked about two thresholds. One is the existential cost of the business, meaning the business can just operate. And of course, the second milestone is then what's the existential cost of ourselves? Sure. Now many episodes, we've said that businesses don't go out of business until the founder goes out of business. Meaning like we literally can't afford to operate. We're kind of flipping that on its head a little bit here. I just want you to understand the folks listening to understand what we're saying is how can we set the business up as a stand alone existential unit where it can operate, even if we maybe need to go take a break and do something else, like get a job or do some consulting for a while so we can come back to it. Ok? Because what I've learned and this is what you're just getting in a moment ago is that there's often lots of stuff along the way in the early phases that essentially fund the existence of the entity that don't scale whatsoever. Most obvious I'm literally working another job so that this business can exist, right? Happens all the time, perhaps 90% of the time, you know what I mean? For

Ryan Rutan: sure. No, I, and again, I think that goes back to, you know, and, and a lot of those things don't occur to people because they didn't plan for that, right? The word that you mentioned was the one that I had in mind during this entire segment, which was scale, right? One of the things that we hear is people are spending lots of time, money efforts planning around things that will scale. You know, we want to make sure we have a scalable this and a scalable that I like, you know, why don't we just, you know, clear the fence before, worry about scaling anything higher than that, that goes lost most of the time. And unfortunately, a big part of that comes from the funding narrative because they have to sell that big scaled story. They start to believe it and they forget that look in order to be around long enough to achieve funding or do anything meaningful with it. I have to make sure that this thing can survive, right? I think you and I both said this on the podcast, but perhaps the most important currency in a start up is time, right? It's the ability to

Wil Schroter: persevere you're around long enough. Don't die. That's the key, right? Just keep swimming. Our early plans that we put together are all about this most basic milestone. And I would argue, I don't care what you have to do to get there so long as you can get there. For example, when I was starting my first business, I was trying to get like, you know, a web design company, we were trying to get web design business, but nobody knew what the internet was at the time. A little bit hard to do. Turns out how did I actually pay my bills while I was doing that? I was a receptionist at one of the largest law firms called Jones Day, Revis and Pogue for like a year and a half. I was a receptionist to 100 and 50 attorneys right now. Here's the funny story while I was doing that, like, while I was sitting at the front desk of Jones Day, major law firm, greeting clients and doing whatever I had to do. I had my laptop in front of me, which back then was very unusual. Like laptops were brand new. It's like 94 and I was writing HTML like while I was checking people in and building my web pages, incidentally, Jones Day did my legal work to start. My first company has treated me incredibly well over the years. But whatever I had to do that was my existential plan. I'm literally answering phones for a law firm while I'm trying to build a tech company. Like you can't get more disconnected than that. No, it isn't.

Ryan Rutan: And, and look, we, we've talked about this in a couple podcasts, I think, but it's a conversation I have with founders all the time. Had this come up yesterday in our getting customers workshop where somebody was like, well, I'm just nowhere near being able to get a customer and I've got like six months of personal runaway, but I can't see revenue for the next 12 months. And I was like, well, then let's move sliders like we either have to move up your runway, we have to move down getting a revenue. I said, well, there's just no way we won't have the product or we won't have this writing. I was like, well, you already have the expertise or have. So we, we started talking about a service based proxy, like let's go sell something else that leads into and feeds the product development. We talked about this a couple of podcasts ago. And it just, again, it doesn't occur to people because they're aimed at whatever that scale point. They're just like you and I were thinking this has to be $50 million. This has to be 25 million. Can't be $10,000. Well, it can't be $50 million without the $10,000. Let's not let that go unsaid. Right. We have to get there first and whatever we have to do to get to that existential stability is worth doing.

Wil Schroter: You know, something that's really funny about everything we talk about here is that none of it is new. Everything you're dealing with right now has been done 1000 times before you, which means the the answer already exists. You may just not know it, but that's ok. That's kind of what we're here to do. We talk about this stuff on the show, but we actually solve these problems all day long at groups dot Start ups.com. So if any of this sounds familiar, stop guessing about what to do, let us just give you the answers to the test and be done with it. I always think of a video game analogy here. You know how at the beginning of every video game, you have nothing, you know, they always put in some perilous situation. Like uh right now I'm thinking, you know, one of my favorite games of all time Fallout where you always exit the vault and you have like nothing but your vault jumpsuit and, like, maybe a pistol or something like that. I have

Ryan Rutan: an empty knapsack and a

Wil Schroter: screwdriver. Yeah, exactly. I have an empty knapsack and then, like, you always have to start with like, a melee weapon or something like that and kind of work your way up. Right. And it kind of, it's not pretty how you get there. Right. Like, you're beating up like, mutant dogs or something. right? It's not pretty how you get there, but all that matters is you survive long enough, whatever the mechanism is to be able to kind of build a base to level up from. Frankly. Honestly, that's actually my favorite part of those games is like this, the ingenuity that comes with getting started, but it's a new start

Ryan Rutan: up quote for your wall. I wake up every morning and I eat a mutant dog. That's how I got where I am today,

Wil Schroter: but the same applies where in the formative stages, it kind of doesn't matter what we do so long as we, we get through that survival stage to give us an opportunity to build for later. Now, what I fear is that most founders don't actually understand the cadence or progression of a start up from the outside. It looks something like this. It's relatively linear, it's relatively OK. Yeah, we have good months, bad months, but it's always kind of moving up into the right. That is not how start ups were at all whatsoever. Full stop. And that's right. There is where people break their planning. Oh, by the way, why would you know this? Right. But having been around, you know, a few 100,000 of them, it's becoming fairly clear. It's pretty clear. It looks something like this. Right. Let's use our video game analogy. Ok. I exit the vault and for those of you that don't understand, fallout doesn't matter, go play it.

Ryan Rutan: It's important. Start up lesson. Yeah.

Wil Schroter: Yeah, I exit the vault. I go out into the wasteland. Right? I have nothing. I'm thinking, well, I get this and I just keep leveling up et cetera. Imagine it goes like this. You get out there, you encounter your first monster or whatever you get in front of and you get killed and you get sent back to the vault. Then you go out and you make it a little bit longer. Then you get killed and sent back to the vault. It's a bunch of starts and stops like hard stops and resets. Not just a bouncy progression to success. Every single time you get stomped out, you get the video game version of killed. You have to start over again. Ok. Meaning we made revenue, we made revenue, we made revenue and then we came to a hard stop. We didn't make any revenue or we made minimal revenue. We couldn't pay people. We had to stop, restart and start again. That's what building a start up looks like, which means you gotta make sure your home base, which is the start up survivability can survive all of those restarts. Yeah.

Ryan Rutan: And I think again, like, I think a lot of those restarts are caused by aiming a little too high to begin with. Right. I think if you were actually aiming at existential stability instead of $50 million and hoping to trip across the line of existential stability when it happens accidentally, I think it happens a lot later. And I think it's a lot harder to achieve if you aim for that specifically. If you're like, look, I don't need the gatling gun. I just need to eat a mutant dog. Let's just get to that point and do whatever we have to do. And, and I think I'm always pleasantly surprised when I come across somebody that's doing this. I have a funny example here in Guatemala where I called an Uber. And Uber said, you know, I'll be there in, in, in seven minutes. Sorry. But do you have any, any suitcases or, or anything with you? And I said, no, ok, cool. He comes and picks me up. I started talking for a few minutes asking what I did and started to explain a little. He's like, that's really cool is like, well, so the reason I asked you if you had any suitcases was I drive this Uber, but it's two full. It's keeping the lights on while I build my Agrochemicals distribution business and the reason I picked Uber was because I just drive where I need to take stuff and then hope to pick up a fair or hope that there's a fair that's going near where I need to drop stuff off. So this guy had a trunk full of agrochemicals, which I was a little, like, super comfy with. They, are they organic at least. Right. Like, that's not a crash and be dissolved by uh some sort of a horrible solvent. But I love that. Right. I loved that. He was like, look, I'm doing this and it's gonna support me through this period and I found even a way that like something as divergent as driving Uber sounds, he found a way to tie it to the business and make it beneficial way. I love that.

Wil Schroter: It's just amazing. That was me being a receptionist at a law firm. I was like, hey, you know, I'm surrounded by a bunch of attorney. Maybe they understand how to do an incorporation, which back then was impossible to do. That was a $30,000 project.

Ryan Rutan: Oh my God. Impossible and expensive as all hell.

Wil Schroter: Yeah. Yeah. Yeah. And I was like, oh, maybe they can help me with my contracts and stuff, which they did again. It wd up being an amazing relationship. Those guys were awesome. But it's interesting to me because in those early stages, I don't think folks understand that there will be multiple hard resets. And in order to be able to survive those resets, the business itself has to be able to survive. So let me be a little bit more specific as to what that will likely look like. So I'll use my own example. So I'm running Blue Diesel. This is again the web company from way back in the nineties. And I'm working at, at the Jones Day at the law firm getting paid like $5 an hour if that, if you know, whatever minimum wage was back then in the days of your, just enough to keep the lights on. But I'm actually getting our first clients. Now, our first clients are not paying us anything like hundreds of dollars because no one understands what the internet is yet. Ok. We're ribs or ribs. Yeah, I also got paid

Ryan Rutan: in ribs will and I both got paid in food at one point. Yeah, I,

Wil Schroter: I was perfectly ok with that. So I probably got paid more in food than I did in actual cash at the time. That's ok. At some point, at some point, we ran out of money, just use slow contracts coming in and it's a people intensive business. So I had to like, you know, pay salaries, which were all college kids time. So like it was fairly fungible. But I specifically remember this moment in some of the characters in the story, you actually know Ryan. Uh Damon. I remember sitting in our office. This is in the very early days of blue diesel and there's all of us in the office. We had all of our desks that we had just bought a few months ago from staples that we'd all assembled ourselves. We were so proud of these desks. Right. And I have to try to explain to the folks all in the room that we don't need money. Like, you know, we thought the contracts were gonna come in. They didn't come in. I'm like, guys, I kind of can't pay you and they're like, well, we can't exactly work for free because we're all just graduating and we actually have to pay bills and I'll never forget this is to decide. But I thought it was hilarious. One of our programmers, Joel said, you know, we just had money like a month ago. Right. Where did it all go? And Damon was like, you're sitting at it and he was pointing at his desk. He was, he was dead straight. Right. He's like, and he wasn't wrong. That actually is where the money went, that $400 went to your, to, to buy your desk. But I had this thought at the time and I thought, what if we just didn't shut down? We have no money. Right. And I've clearly had no savings. What if we just didn't shut down? Like we're gonna have to evacuate this office because we can't afford this. Right. We're gonna do something with these $400 deaths that we just spent, you know, all our money on. I was like, what if we just go back to my campus apartment and we just work out of my apartment? Like, at that point there's kind of nowhere else to go, but we still exist and I just thought it was being desperate, which it was just to be clear. Right. I had zeros of dollars and I had nowhere to go. There was no backstop, there's no home to go to. There's nothing right. This was it. When I realized, you know, we kind of moved back in my apartment. It wasn't exactly a glory moment by the way. But what I realized was like, hey, if we just always have some backstop that we can, you know, reset back to whenever kind of shit hits the fan, then we can kind of just not die, right? It's the safe point, man, what happens in the future? But in fact, almost to the day Ryan, a year later, we would sign a quarter billion dollar contract. And if you just think about how like how different those two moments, I were unbelievable, you know, out of a story

Ryan Rutan: and how important the one was to achieving the other, right? Because there were lots of other decisions in the decision tree, right? You could have, you said there was nowhere else to go, but you could have just said, look, I'm gonna up my hours, the law firm, I'm gonna do whatever. I'm just gonna quit. I'm gonna go get a job, I'm gonna do whatever. So, you know, it is, it's that time that buys you so much just to be around and to be able to get to that next moment. Right now we've talked about, there are also times where like you're pushing that too. It is time to pack up the tents and go home. But at these early stages where there's very little where there's truly very little cost. And I mean that in a lot of different ways, you know, you were young, the operation of just keeping the lights on wasn't significant because you were gonna keep those lights on anyways because those were the lights that, that you, you, you woke up to and went to bed to, right? So you were living in that place. We did the same thing, by the way, now we were, we, I actually didn't ever have an office, kind of rented a larger apartment. It started in the apartment and then we we outdrew the apartments, we just rented a larger university apartment, which by the way, I had a stipend from Os U at the time. And that was how we afforded the larger apartment without any risk because I wasn't using up the entire rent portion stipend. So I was like, hey, we can get another 500 square feet without any cost. And it was like, all right, cool. Moved from one side of Neil Avenue to the other. That was as far as we went 1248 to 1249. Yeah. And so I think that at those points, like when you start to consider that, you know, like the, the cost of sticking around is a lot less than the cost of not sticking around. Right in, in your case, it was billions of dollars in future billings that would happen through that company and then through what that company grew into and became that otherwise would have gone away over what, $550.

Wil Schroter: That's my point

Ryan Rutan: nuts. It's just absolutely nuts at

Wil Schroter: that moment. I clearly had no idea how that things were gonna go in the future. But at that moment, I was kind of like, what if we just do enough that we don't die? Right? It's, it's not that we think things are gonna get great. But what if maybe, and this is, nobody thinks about this at the time. What if maybe this just in our year, everybody is so myopic that they think, ok, this has to be the year everything's gonna happen this year. Look back in your life, how many times did everything happen in that year? Once, maybe twice? If you're lucky if you've crushed it at life, you've got 11 or two huge moments that were like career defining et cetera. Now think of how hilarious it is. You're super certain that this one year where you happen to start a company is when everything is gonna take off. It's like we've been on for 12 years at start ups.com alone and every year we try to make it the big year. But if you look back in our history, we have plenty of years where we just coasted or things didn't go, you know, particularly well, right. Happens all the time in the formative years though. You're still in the only year.

Ryan Rutan: That's it when you, I have no other years to compare it to when a year still sounds like a long time. Like when we've been around for a year, we'll have been around for twice as long as we've already been around. It's hard to look at that and go, we don't have to make this work right now. And I think unfortunately, you know, for as much as the change in available information has helped a lot of start up founders, right? Because you and I, we talked about this that we used to have to go to a library and pick up a book if they had, you know, subject to availability right now. There's all this information at your fingertips, but there's also a lot of narrative that is sort of counter to the principles that we're talking about today. Like things that make you feel like you need to go faster, you need to be bigger, you have to make more money. 10-K is not enough, it has to be 100 K, right? Like why is my MRR? You know, and it's so funny just giving somebody the permission to feel OK about that is so, so valuable. This would have happened about a year ago. It was earlier on in the kind of like when, you know, a I really started to hit the full public zeitgeist, right? So maybe a little over a year ago and a young female founder was building a really cool tool that did some really fun Twitter automations and had gotten to like 1200 in an MRR and, and was just like, kind of crying about it, right? Not literally crying about, it was just like, you know, I just, i, it's only $200 and I was like, you know what, you know, how many people are out there pushing tools right now that haven't gotten anybody to pay them a single dollar, like $1200 is a big deal. It's $1200 more than you had before you had dollars, right? It's so, it's a, it's a huge thing and it's an indication that you're on the right path, we move in the right direction. And she said, you know, it's amazing to hear about that and it was like everything because I said it and she said, well, actually it's like, that's how I felt. But because everybody around me had all these other, better, bigger numbers. Everybody else sort of told me, like, oh, you know, don't worry about it. It'll get better. Nobody told me that's good enough for right now. It's like, but that is actually how I felt. But then I was taught not to feel that way. And I, and I find that this is one of those really, really sad things about the kind of the information environment that we have now is that it sets the wrong expectations and the wrong trajectory for so many businesses.

Wil Schroter: Yeah, I agree. I look at, you know, give us at a personal level. A friend of mine told me a long, long, long time ago, he said the moment you get $20,000 in your personal bank account, you'll feel richer than you'll ever feel again. I got it because I was broke at the time. Right. So at $20,000 you might as well said $20 billion

Ryan Rutan: it was. But that's exactly the point. Right, because it's, it's such a stretch from where you are in that moment and it brings so much of that base level existential stability, but that is the best. You're gonna feel everything from there is just a little more icing on the cake. And

Wil Schroter: what he said is with $20,000 in the bank, you're not invincible by all means, it has nothing to do with investing off it or living off it. He said it's the first time in your life that you can absorb a problem. Right. Your car breaks down or something like that where you're gonna be ok on the other side of it, up until that point, like, up until I was maybe like, 22 I couldn't absorb $100 problem and I'm not even exaggerating. I mean, like, I didn't have an extra $100 or any idea where I would get that kind of money. Should that problem arise? And of course, the problems arise, right? Like all the time, I mean, I just kept getting more broke, which is, you know, it's hard to get out of that cycle, but for start ups, that 1st 5000, 10,000 that allows the business, you know, to kind of absorb some of those hits while you're still figuring shit out. Like that's me going back to a law firm. Like, hey, dude, you guys got any more of this uh receptionist business. It's like this, this web design thing isn't working out so well right now, right? And I gotta tell you at the time and this replies to a lot of folks now, I would have been ashamed about that. Right? I would have said, oh, man, you know, I, I failed as a founder. Now, I have to go back to this job that I don't really want, et cetera. I feel very differently about it. Now, don't get me wrong. It's not awesome. Right. It's not your, it's not your plan a OK. But what I will say is the founders that get it either instinctually, Ryan, you know, instinctually where they're just like, I guess this just kind of makes sense, which is kind of where I was or intellectually or, you know, experientially they've been there. They're like, yeah, you know what, sometimes you take steps back. Right. It would be cool if that weren't the case, it'd be cool if we only took steps forward. Right. That ain't how this business

Ryan Rutan: works. Yeah, I don't think I've seen when it was built that way though. That'll be the exception. That proves the rule for sure.

Wil Schroter: That's the other funny thing. It's like this is the consistent thing. Like, I always joke where every founder thinks that they've got this unique story right? Where they've come from nothing and built it up. And, you know, it's the most common story

Ryan Rutan: until they talk to literally three other founders. And you're like, wow, three out of four of us have exactly the same story. Yeah. Yeah. There's a lot of commonalities in the past. Yeah, we're all still flakes too. We're all building something a little bit different in our own way. And yet, you know, the macro level of the story, you zoom out a little bit and bore the lens. They look a lot

Wil Schroter: alike. They do and, and I, I think the common thread with all of them. This is really what we want to drive home the most, right? What we wanna drive home the most is this isn't a business about just prosperity. It's about living long enough to have that prosperity. The live long and prosper concept means first, live, long, step one don't die, right. First live on whatever you have to do whatever you have to do to keep this thing alive, keep it alive. Even if you have to do a full 360 degree, you come, you come out of it, you come back to it, et cetera. That's perfectly ok. The key is keep it alive. And so that 1st $10,000 5000 dollars, whatever your minimum number is just to keep this thing alive is the most important money you will ever make and ever keep consistent because it allows you to get to that point some way down the road where you can prosper. So in addition to all the stuff related to founder groups, you've also got full access to everything on start ups.com that includes all of our education tracks, which will be funding customer acquisition, even how to manage your monthly finances. They're so, so much stuff in there. All of our software including Biz plan for putting together detailed business plans and financials launch rock for attracting early customers and of course, fundable for attracting investment capital. When you log into the start ups.com site, you'll find all of these resources available.

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