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SPEAKER_06: episode where we do Ask Jason. That's where you ask me questions I give you answers. We have a number of great great questions including a very timely question about Zirtual and transparency and what happened there. Very controversial, very timely. Finally we have somebody who had their ideas stolen by one of their beta users and they think another VC tried to do a brain dump on them and asked them a bunch of questions to give it to that other company. Really controversial stuff and a question from one of my friends in Ireland, a super fan

SPEAKER_08: in fact, who wants to know how to work at a startup in the United States since he still wants to stay in the beautiful country of Ireland where I'm from. Okay,

SPEAKER_10: it's a great episode and you're gonna love it. Stick with us.

SPEAKER_12: It's what it's all about, man. They said, money is the root of all evil. What? Funny how it feeds my people. Yeah. We ain't gonna live like equals until we get the money, spend the money and defeat you. Yeah. Money is the root of all evil. What? Funny how it feeds my people. Yeah. We ain't gonna live like equals until we get the money, spend the money and defeat you.

SPEAKER_20: Hi, Jason. My name is Paul Towers and I'm sending this question in from Sydney, Australia. I'm a massive fan of the show and I really do like the Ask Jason segment. Whenever a company closes its doors, as was the case with Zirtual the other day, I think it offers a great chance for other entrepreneurs to learn some insights about what went wrong and to see how they can avoid similar situations in the future within their own startup. With that in mind, I would be interested to hear your thoughts on the following two questions. Number one, when a company is running low on cash and short on runway, how should they balance the need for being positive and upbeat in order to track new capital and investors with their requirement to be honest to all stakeholders, including customers, employees and as well as the investors? Obviously, you know, they need to paint that positive and upbeat picture to attract the capital, but there is a requirement, you know, obviously to be honest with employees and customers so that they can, you know, plan for the future essentially. Two, when a company sees their margins decrease, as was the case with Zirtual when they moved their ZAs from contractors to employees, should that entrepreneur or founder focus on trying to grow their way out of trouble? For example, Zirtual was looking at that 24 hour service as well as the team service, or should they limit their focus to the current product or service that they have and look to identify and fix any problems that are present there, even if that comes at the expense of growth? Thanks, Jason, for your insights on those two questions. I look forward to watching many more episodes of Twist. Thank you.

SPEAKER_06: Okay, great question. A timely question, of course. I've been dealing with the Zirtual issues for the last couple of days. What I will say is, as a disclaimer and generally, I'm an investor in the company, I'm an angel investor in the company. I don't speak for the company, even now that it's defunct and sold. I am not a spokesperson for the company and some people think angel investors are hanging out at the companies they invest in every day.

SPEAKER_08: In fact, we never go to their offices, almost never. We meet with the founders, typically one-on-one or do phone calls or emails, and we help where we can. But the whole idea of being an angel is that you're not operational inside the company. Okay, that being said, I have an opinion on everything. As you know, that's why you tune into the show. And I'm going to tell you my opinion on what happened with Zirtual. I'm going to tell you my opinion to your two or three great questions there. Let's work backwards. When Zirtual went to full-time employees, obviously that's going to cause massive margin compression.

SPEAKER_06: They were adding 30% of expense. So if you pay somebody $30,000 a year, if you add benefits, time off, paid time off, and healthcare,

SPEAKER_08: you're looking at roughly adding 20%, 30% to your costs. Now, if you have a 20%, 30% margin, now you're going to be in the red in all likelihood. And what it also means is that, you know, you're going to have to charge more. So what I think Zirtual should have done is when they moved everybody to full-time, I think, and this is hindsight is 20-20, they should have just said to the customer base, hey, listen, we're charging $25 an hour for the service. It's going to go to $30 an hour. We're raising prices, you know, 10%, 20%. In that case, it would be 20%, right? 10% of $25 would be $2.50. So 20% would be $5.00. So we're going to raise it $5.00 an hour or $7.50 an hour. And if you can't do it at that price, we understand, but we want to have benefits for employees. Now, there's a big question of did they have to do that and will the new owners go with contractors or will they go with full-time employees? According to what they've said openly on the web, the new Zirtual under new ownership will be using contractors. And I think that's probably a good idea. I think that this might have been one of the big problems with the business. Obviously, again, hindsight is 20-20. I will also say that people loved the product and people who worked at the company loved the company. So what did the company get right? It's important for us to look at that when we're doing this reexamination of the failure. One, they built a product that people love. Two, they built a job and a culture and a company that people loved working for. Now, it's two of the three stools, right? And the third is they have to have a functional management team that is on top of things. That's the piece of the puzzle that was not finished. And so I applaud the company for getting two out of the three things right. But, boy, is it brutal and hard that they didn't get their corporate governance. They had a small board, two people, the founder and one person who was an investor. And they didn't have their finance right. Now, on to your first question. When should you tell employees, clients, customers, et cetera, that there are problems? Well, number one, you should always be super transparent with everybody who is an investor, including me, and let us know exactly how much runway you have.

SPEAKER_06: That's why when I invest in a company, I ask them to give me a monthly report. And I want the first line to be how much money is in the bank account and how much they're burning every month and divide the two numbers so I can see exactly how many months of runway they have.

SPEAKER_08: An investor can do nothing when you come to them with one month of runway. If you come to them with two months of runway, they might be able to get you a bridge financing. They might be able to help you wind the business down. You really need to start looking three months out, four months out.

SPEAKER_06: In this case, I think they probably, and again, hindsight 2020, they probably didn't go to enough investors and they probably relied on the word of investors saying, hey, we're going to do this. And I see it happen all the time with entrepreneurs. And let me tell entrepreneurs right now super clearly, unless you have a signed turn sheet, and even if you have that, it might not come through, unless you have the money in the bank, it's not closed.

SPEAKER_08: So you want to make sure that, you know, if you're going to consider an investment closed, the money is in the bank account. The paperwork is signed. If it's not signed paperwork and the money is not in the bank account, it's not closed. Now, when do you tell customers? I don't think you have to tell customers that you're running low on cash. I don't think they care necessarily. But you certainly, if they're reliant on the service, you have a little bit of a higher, a little bit of a higher order duty, I think. Because, you know, they may have some, they may need some time to switch. In terms of employees, you've got to be honest with employees, and you've got to tell them the truth.

SPEAKER_06: And what happens is, they will rally for you. So if you look at this virtual situation, if they had gone to employees 60 days ago, 90 days ago, and said, hey, we have this much capital left, and the business is not yet profitable. Here is what we're going to do. Or here is what we think is going to happen. Those 400 ZAs, who are very, very good people, and who are very spirited people, they would have actually, I think, helped figure out the problem.

SPEAKER_08: They would have said, hey, maybe some group of them would have said, hey, I'm willing to take equity and not get this benefit. Or maybe they would have said, I'm willing to invest in the company. Or I know somebody who wants to invest in the company. Or maybe they would have said, I know my clients will pay more. I talked to my client, and I floated the idea of them paying $35 an hour, and they were cool with it. Or I want to be a 1099 contractor, and I want to set my own rate. What if Zurch will let people set their own rates and just took 20%, like some other services do? So there were a lot of different options, and I think those options didn't get explored because there wasn't enough transparency. And that's on the founder, Maren, and I've talked to her actually about it. And I think she understands her mistake. So it's a bummer of a situation, but you do have to be honest with everybody at all times about where you're at. And it's no big deal.

SPEAKER_06: People who come to work at a startup or who use a startup service, they expect that the startup is going to always have, call it, 2 to 12 months of runway.

SPEAKER_08: 2 to 12 months of runway. It's very common.

SPEAKER_06: So, yeah, it's a little bit scary that the company only had X number of months of runway, but they just didn't manage the communication of that properly.

SPEAKER_08: So you nailed it in terms of your question. Great questions, and thank you for asking them. Let's go on to our next question.

SPEAKER_26: Hey, Jason, my name is Vishal. I'm a longtime Twist fan and co-founder of WithJoy.com. Joy is essentially Facebook for weddings. We have a wonderful app and a website, completely design focused, and we have done a bunch of weddings now, and they have gone splendidly well. We are about to come out of stealth and go public. And my question to you is that now that we have 45 days to launch, what is it that you would recommend us do? To make a great and a successful launch. Thank you.

SPEAKER_28: Okay, great question. I get this question a lot. How should we launch our company?

SPEAKER_06: We all have to launch our company. You only get one launch. So first and foremost, I would ask yourself, am I ready to launch the company? Is the product tight? Does the product have mistakes or errors or crashes or bugs or any kind of problem? And are we launching at the right time? There's a lot of different theories on this. Some people like to launch early, get feedback. Some people like to wait till it's perfect. I'm in the camp that you want to have it pretty close to perfect, and you want to keep your tests very quiet. You can do them in a stealthy fashion. You can basically have your product tested in Canada if you're from the United States with a small group of people under a fake name, right? There's all kinds of different little tricks that people use. Let's assume your product is, you know, good or very good, 85%. I think doing a mini press tour, showing it to people, and starting to think about what is your goal. You want to get people to sign up. What people do you want to get to sign up? Well, if you're raising capital, you want to do industry press.

SPEAKER_08: That means you want to try to get picked up in the launch ticker, TechCrunch, Manageable, VentureBeat, etc. If you're doing, that's technology industry press, startup press, because you want to get to investors. Now, do you want to get actual users?

SPEAKER_06: That's a different group of press.

SPEAKER_08: So in your case, if it's a wedding site, or if somebody else is doing a comic book site, you might want to get into comicbook.com if that exists, or you might want to get into a wedding bridal magazine, right?

SPEAKER_06: So when Stowaway, the cosmetic company I invested in, when they came out to do their press, they were focused on all the beauty magazines. They weren't focused on business publications or technology publications. You've got to pick who you want to do. And it's very simple. The founders should just email the journalists who are covering the space. And they should tailor their email. It shouldn't be a cut and paste job. Pick ten journalists, read their last three or four stories and say, Dear Jason, I see that you've covered some photo sharing apps before and some wedding apps. We have a new entrant, and we have an NPS score of X, and people love the product. Here's how it works. I've attached some screenshots.

SPEAKER_08: We'd love to get coffee with you for 20 minutes or do a screen share and show you what we're working on. I think it's quite notable for these reasons.

SPEAKER_06: Super short, super to the point, visual, etc. Number two, you want to have a launch video. People love video. People watch videos. So get your launch video ready. And if you give a launch video and animated GIFs to the press, they will cover it. So when I launched Inside and our Inside Verticals, I made animated GIFs and gave them to the journalists I was talking to.

SPEAKER_08: And that really helped because they have something to put with their story, right? That's having collateral. So you have to define what you want to get out of your launch, and then you can pursue it that way. Some people are looking to raise money. Then you want to target the press, the financial press, the VC, angel, startup press. Some people want to get customers. So you have to make that decision.

SPEAKER_06: And there's plenty of endemic people who want to do that in your case. I think giving it to one person if they do a long story is a good idea. If not, you can try to get five or six people to do it. Having your investors email the press is also a good idea. Product Hunt is becoming very popular. People have me posting it to Product Hunt because they have more followers there. So finding somebody who already has a lot of followers, asking them to put it on Product Hunt at 7 a.m. And then emailing all your investors, all your family, all your friends and saying, hey, and I don't know if you're allowed to do this or not, but we're up on Product Hunt. You know what to do. You know, code for, please vote us up. Please write an intelligent comment. So, and you've got to have a little bit of, you know, an angle here.

SPEAKER_08: So your weddings for Facebook, really to me, is kind of weak, right? It's like social network for weddings. You've got to really have some killer feature or a better peg, right? A better angle.

SPEAKER_06: Because there's wedding apps everywhere. So without knowing your app and its features. But if it said, hey, the key feature of the product that people are dialing into is crowdfunding for weddings. And we had three weddings that were crowdfunded and here's how it worked. That's kind of interesting, right? So find some angle in your software which is palatable to journalists. How do you figure that out? Well, if you talk to a journalist friend and you say, hey, what do you think is interesting about my product? And they say nothing. And you say, well, what do you think of these ten ideas? Which of these ten ideas we have is the most interesting? Let them tell you. I think this is the most interesting. This is the second most interesting. Ask five other people which two are the most interesting. Then make a ranked list. And then go to your team and say, hey, listen. Everybody thinks crowdfunding for weddings is the killer one. To crowdfund for a honeymoon is a killer one.

SPEAKER_08: And everybody thinks, you know, this new app which stitches together everybody's best of videos automatically from the wedding. If they, you know, submit them to this email and we basically make a wedding video based on everybody's phones because the phone's really good. Wow, that's a pretty good idea now that I think about it. If you had that service which was wedding videos, crowdfunded, crowd sourced wedding videos, your guests taking videos

SPEAKER_06: and then they stitched it together and made sense of it all, boy, would that be interesting. And so you have to understand what's interesting to the press. And some features you add to your product because they're press bait and they're, you know, marketing bait. And then other ones are the core of your product. So you'll see this all the time. You know, when Uber does Uber for kittens, it's not like there's a huge market out there for people to bring puppies and kittens to people's offices to play with. It's obviously for dramatic purposes in PR. When they do ice cream, you know, it's fun and people like ice cream,

SPEAKER_08: but people are not using Uber for ice cream every day yet. Maybe they will someday. So those little, you know, fun items are something that you can figure out by just making a list of features,

SPEAKER_06: asking your friends to check off on a list which two are the most interesting. You could also do this if you had emails and just set up a Google form and say, we're thinking of launching 10 products. Which two do you think are the most interesting? Just most interesting, right? So get feedback and plan your product roadmap against a press tour, right? So you have a press tour every three months, every four months, little press hits about some interesting feature coming out in your product. Good luck with it. Thank you for the question. Let's take another one.

SPEAKER_33: Hey, Jason. I'm working on a hardware startup, and my question is around crowdfunding. Would you rather bring an angel investment to a company that's already closed the Kickstarter on a shoestring, or would you rather support the company at the beginning, get it ready to go so that the product's ready to launch, and then see the Kickstarter used more as a promotional vehicle? This is a fantastic question.

SPEAKER_06: Should you do your Kickstarter before raising funding so that the VCs and angel investors can see demand, or should you do it after you raise angel and VC and then do it when the product's more refined and get a bigger response? The answer is both will work. I've invested in companies like Birdie and Butterfly. In both those cases, they did modest but significant crowdfunding campaigns, and that really, for me as an investor, took out a lot of risk. I knew there was some level of demand for the product. It also showed me that the founders had chutzpah. Chutzpah. They had gall. They had... I'm going to use a word. I shouldn't use that word.

SPEAKER_35: They had the guts, the gumption, to get in there and say, hey, give me your money.

SPEAKER_36: Now, one of those two, I wouldn't say which, or another company I'm investing in,

SPEAKER_06: is doing another essential crowdfunding campaign after I invested in them, and they're going to convert the old people who were in the first one to the second one and then add to it, right? So there is a new thing that's occurring, which is do a Kickstarter or Indiegogo or Tilt campaign, but do it 60 days before the product drops, not 16 months, so that people can expect to get the product. Let's say if you did it in end of August or beginning of September, people could expect to get it in December. These are clever ideas.

SPEAKER_08: These work. So either of them can work, and a lot of it has to do with what's your... What do you have available to you? If you have angel money available to you, venture money available to you, by all means, take it and then do your Kickstarter. If you don't, you don't have much of a choice. Do the Kickstarter and then use that as bait for the VCs and the angels.

SPEAKER_06: So if VCs and angels want to invest in you and they're cool with giving you the money in order for you to launch your Kickstarter, great. If you don't have the track record or connections or a killer idea and execution, then by all means, do the Kickstarter first.

SPEAKER_38: Hey, everybody, let me tell you a little bit about Envision app. I use Envision app all the time with my designer, my product manager, my growth team to share mock-ups of our products.

SPEAKER_08: We take those mock-ups and we design them and we send them to clients, to partners, to investors. And we say, here is an Envision link. Open this on your iPhone, on your Android phone, and you can click through and see what this product that we're making is like. And when we're building websites, hey, put your comments on there. We have a partner. We have a big Smart Camp thing going on with IBM, Smart Camp 2015. You know, we can use Envision to share that website and say, hey, is there anything you want to change? And then have a threaded discussion. You can take all those discussions off of email, all those discussions out of the chat room. Listen, email and chat rooms have their place, but not in product design. Envision is like Slack, but for product design, right? So you have Slack for a general conversation. You have Gmail for, you know, asynchronous communication. You have Envision for product excellence. You cannot make a great product without Envision. I am dead serious about that. Every startup I invest in, I show it to them. They ask them to send me links, and boy, does it work. It supercharges everything you do. I love this product. I love this product. I love this product. Get out of email, get out of chat rooms, and do what Twitter, Airbnb, Evernote, Adobe, and many more are doing. Prototype, what you're doing in Envision. It just makes designers and teams and founders so, so, so much more efficient. Go to envisionapp.com slash twist for 90 days free. That's their startup plan, free for 90 days, only at envisionapp.com slash twist, envisionapp.com slash twist. And everybody thank Envision app on Twitter. I thank them for making a great product and for supporting independent media like this week in startups. Let's get back to this amazing episode.

SPEAKER_41: Hi, Jason. This is my question for you.

SPEAKER_43: With the uprise of technology in today's modern society, do you see a disconnection starting to form from reality? I would also like a professional opinion on funding a startup focused on living in the now. Essentially, this would be a pathway to better living, mindset, and health. This could be achieved through a variety of mediums, but some of the ideas that I have would be podcasts, books, and seminars. What do you think?

SPEAKER_38: Okay, I'm trying to understand the question.

SPEAKER_08: I think the question is around people becoming a little disconnected from reality, maybe a little bit too into their computers and their devices. There's definitely a trend there, right? And the trend is going to increase. So when you see kids out at dinner with their parents and the parents are on their phones and the three kids are on their iPads, it's very easy to look at that and say, hey, something's been lost. People are not talking with each other. And it's true. When I play poker and everybody's on their phone playing poker while we're playing poker, I find it a little bit annoying. I wish, I wish that at my poker game and that at dinner, everybody would just stack their damn phones in the middle of the table and be present. I have worked very hard in my career on being present for my family, for my friends, and for the team members I work with. But nobody's perfect, right? The allure of what's happening on your phone is great. In fact, there is a 100% certainty that there is something more interesting and fascinating, funny, sexy, intelligent, inspiring, infuriating on your phone right now than anything that I could say to you, which means you should shut this program off, right? I mean, that is God's honest truth. On a statistical basis with a billion people online, way over a billion people, there's always going to be something more interesting going on. So you have to decide for yourself. Do you want to chase the quick hit, the dopamine rush of whatever the trending thing on Twitter or Facebook is and the quick pop of whatever email is more important than the person that you decided to make a goddamn dinner reservation with or not? I think everybody comes to a conclusion at a certain point in their life if they're self-aware that they are missing something by not being present with other human beings and developing real relationships with them. Some people take some decades of their life, and this predates literally anything to do with technology. I mean, people used to do this with books or comic books or movies or music. People get obsessed with things and they lose their humanity, they lose their relationship, they're not present. But to every time the pendulum swings, it swings the other way, there is a counter. Mindfulness is becoming huge. So I am an investor in a company called Calm.com, I practice mindful meditation myself, and many CEOs do, many basketball players do, a lot of heads of state do. Why? Because you need to slow down in order to speed up. You need to create extra cycles and space in your brain, in your consciousness, in order to be a peak performer. So I can tell you at the poker table, if you're playing a poker hand in between poker hands, you may be missing out on some time with your friends. You may also be missing out on becoming a truly great poker player. You need a little bit of head space. You need a little bit of space for your mind to consider possibilities. So in our launch incubator, I insist during our talks that no devices be out. And I am militant about it, not only with my incubated companies, but also with my staff and also with myself. My staff is there, and it's very easy for the camera operator, the AV person, or a sales executive who's at the launch incubator when there's somebody speaking to look at their phone. And what I tell everybody is, take the 40 minutes to listen to the speaker fully. Give them your full attention. And then enjoy the fact that nothing is interrupting it because in boredom comes inspiration. In boredom comes solutions. That's why people say, I'm in the shower and I had a great idea. Or I went for a walk, I had a great idea. Or, I was doing nothing with my spouse or significant other, and I just had a magical moment when we were just sitting there looking in each other's eyes. I don't mean to get all sentimental on people, but this is the God's honest truth. I've worked on this myself in my life. Because I wanted to be present. And you know, when you have a kid, I've got a beautiful daughter, and I wanted to be present for her. So now when I take her to breakfast, sometimes I leave my phone behind. I leave a little note for my wife. Here's where I'm having breakfast with London. I'm going to walk on this path. It's incredibly old school. I tell her the path I'm going to walk to go to our breakfast place. So that I'm not even tempted by the damn phone. I want to have those moments in life. And you should want to have them too. So to build products and services around it, great. Movies, events, yeah, these things all exist. What I would encourage you to do is look at what Calm.com did and consider things like that. Or maybe there's an online, offline thing you can do. But certainly it is a space that is growing and that is important. And with VR, if you haven't used VR yet, or AR, augmented reality. Virtual reality is when you put the headset on and you go into another world. Augmented reality is when you put the glasses on, you see your world. But information, pixels are put on top of the world. So you're looking at the world and then above somebody's head, it says how many followers they have on Twitter. And if you're connected to them on LinkedIn or not, it's really crazy, scary stuff. That's going to divorce us from our humanity and give us another level of distraction. You just have to choose. I'm not going to be distracted and I'm not going to lose myself in those places. I'm going to balance it out. There is opportunity in those other places as well, though, as we all know. Hey, listen, if you could do virtual reality and instead of going to a history lesson and watching a movie or reading a book, both are valid mediums.

SPEAKER_49: But to be able to, like, be on the beach at Normandy when things were happening or to walk through, you know, the launch of, you know, landing on the moon. Your understanding to be able to walk around the moon landing and look at an accurate moon landing, the moon lander, like, this could be incredible and transformative for education. So this is valid. But you have to balance.

SPEAKER_08: And society just takes a couple of years to catch up with these things. So I think you're in actually a very interesting space. I encourage you to experiment and to look at the primary research and try to figure out.

SPEAKER_38: UCLA actually has probably the best primary research on mindfulness, meditation, et cetera. I would encourage you to make it polished, not kooky, Santa Monica, hippie stuff. Because that, when it's a kooky, hippie, Santa Monica stuff, people are not into it. But when you polish it up and you make it like Calm.com did or, you know, different yoga companies, Lululemon, if you polish it and you make it a little bit more classy and less kooky, I think you can get people to adopt it a lot better. It's a good question, actually. Thank you.

SPEAKER_51: Hey, Jason. Good morning from Boston. My name is Ignacio Castro, big fan of the show. And this is my question. We are working on a platform called Proximity to connect software developers in Latin America with the startups. And we are working on this initially from Boston. We are targeting post-series A startups, companies that have enough runaway and a big enough team that can think of getting a sizable team near shore. And we would like to know from an advisor, an investor standpoint, would you recommend to outsource development at this stage? Will you do it later? Will you do it earlier? Is this a red flag from an investor standpoint depending on the stage? So thanks so much, guys. Really happy to be in the show. Thank you. Bye. All right.

SPEAKER_55: All right.

SPEAKER_08: Calling in from Boston. Is outsourcing, to summarize your question, a red flag to investors? The answer is yes, it can be. A lot of places like Y Combinator want developers on the founding team. A lot of investors, angel investors I know, will not invest unless there's a developer founder, a technical founder. I am not as rigid about this because I've seen over and over again people like Evan Williams or Travis from Uber, et cetera, who are not writing code create great companies like Twitter and Uber. So, you know, you can't paint with a super wide brush. It is helpful when you have developers in a startup early on because they can be more capital efficient, which is to say they don't have to worry about a developer leaving because you have a developer who owns a massive chunk of equity in the company known as the founder. So it takes a lot of risk out for entrepreneurs. When people see, so you do lose probably half of early stage investors if you don't have developers on the team, because they just look at it and go, oh, they're going to outsource, they're going to try to hire people, they're going to struggle. That being said, I've seen a lot of companies build their product in-house. For example, Bento, which is a food delivery service here which I'm an investor of and that went through the Launch Incubator. They built their iOS app and they outsourced their Android app to a company called Rocket Ship, which I own a piece of, which actually is in Latin America, or I'm sorry, South America with a lot of developers. I think it's fine to outsource, especially when you have the product designed by the founders. Now, would I outsource the design and the product UX? No. I think that's a recipe for disaster. So if the founder doesn't understand product, they're not going to get invested in. You have to be able to understand product and why you're building stuff. If you're not laser focused on product, you're definitely not getting investment. If you're not laser focused on developing the product, having developers and doing the technology and developing the product, you might get investment. So outsourcing is okay. The problem with outsourcing is if the company is going to succeed eventually, then why not just hire the Android developer? Well, you may have to hit a date and you may be very successful and this will just get it done four, five, six months faster. And then you can hire your developer to build the 2.0. So in a multi-platform world, I think it's acceptable. You have to really control costs. You have to have somebody on your team who really knows how to manage those people. But everything worth doing is worth doing right. So I think you need to build a great technology team in your office every day working with the product team, working with the sales team, working with the growth and marketing team. That's the right way to do it here in Silicon Valley. That's the right way to do it anywhere. Outsourcing, it's a tool that you can use, but it can't be the core of what you do. Great question. Let's keep moving.

SPEAKER_60: Hi, Jason. Thanks for all your hard work on This Week in Startups and Launch Ticker.

SPEAKER_61: Really enjoy the ticker every day. Here's my question for you. I've been really thinking about location-aware mobile apps lately and just wondering what you think the secret sauce would be for one to really succeed in the marketplace. Thanks for all you do. Bye.

SPEAKER_38: Thank you, thank you, thank you so much. And thank you for mentioning the Launch Ticker. Everybody should go check out LaunchTicker.com. It's basically my research department. It's really well done. Twice a day you get a summary of the news, and once a week you get the weekly summary. And then there's Launch Ticker Pro, which is profiles of startups that I'm talking to or that are in our orbit, things we're looking at as a company to possibly invest in, et cetera. So proximity app-based apps.

SPEAKER_08: Listen, we had Foursquare. We had Gowalla, which I was an investor in, rest in peace. Checking in, sharing your information, great. Then there was a great program, a product called Twist, which went out of business. Twist.com, which would show everybody on a map. You had Google Local. You had the original Periscope, which was like random collisions with people. You have Grindr and Tinder doing location-based stuff. There's definitely a lot there. The check-in didn't have a ton of value for people. So this passive checking in, I think, was a very interesting concept. I think that's something that could actually be interesting. Your phone is actually recording, you may not know this, where you've been. And you can actually see that history on your iPhone and other things. So knowing where you've been and who's been around you, there's a lot of interesting possibilities there. It's also very scary, so there's a lot of privacy. I think looking at how young people use technology is the key here. I wouldn't focus on old people because we didn't grow up with a GPS unit in our pockets. We didn't grow up with GPS. So we look at everything, if you're over the age of 30, with a little bit of hesitance. Hmm. I'm being tracked. Do I want to be tracked? Just like taking a picture if you're over 50. If you take a picture of somebody over 50, they're like, whoa. Or if they take a picture, they're like, whoa, I'm taking a picture. It's like it's a big deal. People under 30, they take pictures all the time. They don't care. They Snapchat them. They release them. They're just more comfortable with having a camera on them at this, you know, all the time.

SPEAKER_38: So my advice is to just get a group of literally 15 to 20-year-olds together

SPEAKER_08: and then start talking to them about location and what they're comfortable with. Yik Yak, an anonymous location-based chat, fascinating. Two investments I have, Crux, which is doing sort of Slack. C-R-U-X is like Slack for college campuses. And then Huckle, which is location-based chat, slightly different. Both of those, Huckle and Crux, are worth taking a look at.

SPEAKER_38: There's definitely something there. Focus on young people, not the old people because they'll be dead soon.

SPEAKER_52: It's just generally good startup advice. Focus on the young people. Okay, next question.

SPEAKER_67: Hey Jason. I'm a strong believer that if we have a skill in one area of our life, that skill spills over into other areas of our life. Developers solve problems all day. I'm working on a series of blog posts about how developers solve problems outside of code. This idea seems to be resonating with the people that I'm sharing it with, so I think it might end up being a lot bigger than what I had originally intended. I know you have a ton of experience in writing and spreading ideas. My question is, should I go with what I had originally intended and put it up on my personal blog? Or since I'm saying that this idea really is resonating with people, should I try to get it syndicated to a more mainstream platform? Thank you.

SPEAKER_38: This is a great question. I'm a writer. I write and I syndicate. Right? You'll see my posts on calacanis.com and then you'll also see me put them on medium.com, which I'm an investor in and love the platform. And I'll also put it on the LinkedIn influencer program because Jeff and Reid have been very supportive of me in my career over at LinkedIn. They've both been on the show, spoken at events, so I love putting my stuff up there.

SPEAKER_08: And once in a while, I'll get 50 to 250,000 people will look at it over at LinkedIn. Sometimes medium, I'll get 100,000 people and on my blog, same thing happens. So syndicating your content is a no brainer. But here's something I really want you to consider, which is building a mailing list. This is something that people gloss over all the time. People are busy and people still live in their email boxes. People still use their email. I highly recommend building a small email list and sending people your thoughts that way. Because I cannot tell you how many times I wrote something, said to myself, this is super important, and then talked to people who I felt it would be important to and they hadn't gotten it. Build a mailing list. Have MailChimp or whatever other mail service you love. We love MailChimp here. Have it on your homepage. When you come to the homepage, put up a roadblock. When you watch our videos, we give a roadblock. Just go ahead and show people, here's my mailing list. Here's how to subscribe. And make it super dead simple for them to subscribe. And then write them short notes. And then ask and encourage them to hit reply and give you feedback.

SPEAKER_38: Because that's what you really want as a writer is feedback. Because then you'll be a better writer.

SPEAKER_08: I have about four or five people read everything before I publish it. I use the Google Docs system and I ask them to use the commenting system to write their comments in there. So that I can have a little discussion with them. So if they have a problem with the sentence I wrote, they can put a comment in there and we have a thread back and forth. I think that's also very important as a writer. Is to get some feedback from people and ask them to be very candid with you.

SPEAKER_38: To be very cynical, maybe. And to play the role of the cynical bastard on Twitter who's going to just totally be a jerk to you in your comments, right?

SPEAKER_08: Not that you should have your writing be determined by the jerk reaction to it out there, that contingent. But you do want to know and anticipate where they might break down your argument so you can construct your arguments even better. Syndication, no brainer. Thank you so much. Great question.

SPEAKER_49: Hey, everybody. Let me take a moment to thank our friends at Citrix GoToMeeting. I mean, gosh, think about all the time and money and hassle it takes to hold these meetings. My God, you're going down to the valley, up to San Francisco. The traffic, the cost, the flying places. And my recommendation is that you meet your clients and co-workers over Citrix's GoToMeeting. It is a smarter way to meet. And it has beautiful HD faces. Amazing HD quality. I just did an all hands with my team from inside.com. And it was perfect. Everybody had crystal clear VoIP or they were dialing in. And people were on different platforms. Some people were on their smartphones. Some people were on tablets. Some people were on desktop computers. And you know what? I want everybody to have like a headset on. And some people forgot their headsets. And it still sounded really good. It's really the most professional meeting product on the market. It's very affordable. I've had it for many, many years.

SPEAKER_08: I think I'm close to a decade using GoToMeeting. And I want you to try it and sign up for GoToMeeting today. You'll get it free for 30 days. You have nothing to lose. So visit GoToMeeting.com. Click the try it free button. And if you do it now, your first meeting will be up and running in just minutes. And that's GoToMeeting. And your first 30 days are free. It's a fantastic product. It has a chat room in it, which is also a nice feature. I like to have somebody take notes and put it in the chat room. You can also record the audio from it in case you want to share that with everybody. And you know what? I do that as well. It's a fantastic product. Thank you, GoToMeeting. Let's get back to this amazing episode.

SPEAKER_75: Hi, Jason. I'm an experienced iOS developer based in Ireland.

SPEAKER_76: I find it frustrating to hear Silicon Valley startups talking about the skills shortages they currently have when I know there are so many talented people here who could potentially help. Do you think hiring remote engineers is something startups should consider in order to get their product going? And how would you recommend that engineers such as myself who want to get involved can get in touch with Silicon Valley startups?

SPEAKER_06: Oh, God love you for this question. It's a great question from the motherland of Ireland, where I'm from. People don't know. My middle name is McCabe from County Cork. My mother's maiden name.

SPEAKER_08: Listen, I run remote teams on a lot of my startups, inside included. And, you know, mature developers who are hardworking. I didn't say old. I said mature. Like as in like the person's mature enough to get out of bed and start working. And handle not being in an office and not having somebody over your shoulder making sure you're working.

SPEAKER_06: I think people who are mature can do a great job of that. I think the best way to get that going is to build a little bit of a presence for yourself, which means being an expert in something and putting your product out in the world. So if I was an iOS developer, I would say, hey, listen, I'm really good at chat in iOS.

SPEAKER_08: So if you want to add Slack-like functionality, HipChat-like functionality to your product, I'm just good at that. And so you, as the iOS developer, can then go and create a blog about the different chat software out there, the different systems, what works, what doesn't, and build an online presence for yourself. Link to your GitHub, obviously.

SPEAKER_06: Do small projects that showcase your work. And then you can basically get in touch with the CTOs or technical people at the specific company.

SPEAKER_08: So there's always a theme when I talk about it being targeted where you have some level of expertise and you're targeting it. So don't be like a generalist iOS developer. Be like, I'm really good at watch stuff. So here I made a couple of proofs of concept. I put them on a website. I made a gallery. I'm available. Or maybe it's interactions. Maybe you're really good at creative interactions like swipes or something. So you just make an app called, you know, interesting interactions. And it's just literally an app that showcases seven different interactions you do. And you send the test flight. Literally, this would be a killer idea. You show your seven different interactions that you came up with. And you send that as a test flight to ten different CTOs and CEOs and say, I'm an iOS developer. I have a lot of creative ideas. I'm really good at interactions. I love studying interactions. These are the interactions I love most in the world. Path had this. Slack had this. Uber had that. HipChat has this. And so I made a little gallery of great interactive features. And I made an app out of it. And I would love to send you the test flight. I'm available for contract work or I'm thinking about joining a startup full time.

SPEAKER_06: That's the kind of go-getterness that you need to see in a remote worker. Because a remote worker is not going to get caught up in the culture and the enthusiasm in an office. So if they're a remote worker, this is why young people who are inexperienced don't make great remote workers. They need to be part of a culture. They need to come in at a certain time. If they come in late, they need to have people look at them and go, hey, really? 11 o'clock? What's going on here? You're the young guy. You should be in here early. You know, early bird catches the worm type thing and professionalism. And they need to overhear the conversations that are going on. They need to see how other people are working. Other people are solving problems. So I always think, like, young, inexperienced people, they're usually pretty bad at being a remote worker. But if they're mature, they can still be young but mature, and have experience, it can work really well. But you have to show that you are self-motivated, you are self-driven, and that you're going to GSD, get sugar done. If you can't GSD on your own, you have no business being a remote worker. So you have to prove it to a certain extent, don't you? You've got to prove it to the people who you're going to go work for. And so it seems like you're pretty good at what you do. Take my advice. Go build a little gallery of what you're working on and go directly to that founder or CEO. The founder and the CEO and CTO, those people, they all get first name at company name, and you just target to them directly. If it was a brand new startup that's out, like, let's say it was Brilliant or let's say it was Requested or it was Recurrency, if you email the founders over there and you did Sonny at Requested or Brian at Recurrency, and you just email them and said, hey, listen, here's what I think I can do for your company. I sent you a test flight. Here are some designs or here are some mock-ups in an app. Man, they're going to pay attention. If you just send them a resume and a LinkedIn, they're not going to pay attention. Less is more, less outreach, but deeply targeted, and you will get it done.

SPEAKER_81: Hey, Jason, I have a question for you. I joined a startup recently that looks to be a rocket ship. I also have my own project that I was working on before I joined, which was still very early and getting only a little bit of traction. Do you think it's better to stay completely focused on the new startup that I'm working with or to continue working on my project on the side even though I'm able to give it all the attention and time that it probably deserves? So I'd love to get your feedback. Thanks.

SPEAKER_28: Okay, great, great question. Let me summarize the situation you're in.

SPEAKER_06: You're working on a side project as an entrepreneur and it's not getting any traction. So that's a bummer, but you want to keep working on it. You think there's something there. You have unfinished business. Now, you also are working at a startup who's paying your paycheck. You have stock options in it, and it's starting to scale. It's got traction, and you seem pretty excited about that. Well, this would be potentially like going to work at Uber or Facebook in the early days, and they have traction. And instead of staying focused on the fact that Facebook could grow from 10 million to a billion people, you're going to focus on your little side project. Well, what are the chances that your side project are going to be bigger than Facebook itself? My theory here would be, if you truly see that this thing is scaling, put your entire heart and effort into it for a couple of years. Because the chances of getting a seat, getting the lottery ticket, of being part of something very special and unique in the world, they are slim. And if you happen to have lucked into a unicorn and you're an early employee and you have that early stock, I would put all your effort into it. And then I would go to your boss or your boss's boss and say, I want to take on more work. I want to dedicate myself to this. I want to come in on weekends, work late, and really make this company scale to the level we all know we can. And by the way, I'd like to triple my stock options.

SPEAKER_08: And I'd like to put $10,000 into the company. And I want to buy shares in the next company. So if you want me here, I want to have the option to buy some shares in the company in the next round. And I would like my stock options tripled. And I'm going to pour my heart and soul into this.

SPEAKER_06: When a boss hears that, they're like, wow, this person is legit and serious. And, listen, you have very few chances to be on a rocket ship in life. You know, it's not like a bus where there's one coming by every five minutes. You know, unicorns are not buses. They're rocket ships. If you get the seat on the top of the rocket ship where there's only six seats or four seats, don't get off. Take the rocket ship. See how far it goes. Because you can always get off. Let's say the rocket's a dud and it doesn't go anywhere. You can just get off. It's not like a real rocket ship where it explodes and you die and you don't have any other choices. See where it goes. Lean in, so to speak. My friend Cheryl would say. Great question. Your side project will always be there. Okay, let's do one more. My last question is by email and it's anonymous. That means it's a really good question. Let me read it to you. We made public a beta version of our product. Okay, sounds good. One of the beta testers made a copycat product. What? And raised funding. Now their product is in beta and it's an exact replica of ours. I had a meeting with a VC firm recently. I sensed they were not interested in investing but more interested in what we will build in the future. I shared my vision and specific features we have in mind. No numbers were discussed. I think the VC firm is planning to invest in our competitor and was collecting information. Ooh, the old brain suck. Or on Silicon Valley they call it something else. Can you please advise us what we should do other than being more cautious in the future? Well, certainly being more cautious in the future is one thing. You have to come to this knowing, hey, listen. Ideas and designs are very hard to trademark and copyright and protect. Now, if somebody did steal your exact pixel by pixel design, you know, some design is copyrightable.

SPEAKER_08: And so you could talk to a lawyer about that.

SPEAKER_06: If this person was in the beta and you had them sign an NDA, which you didn't, I'm sure, that could be actionable as well. Assuming that didn't happen, you don't really have many options. If you put an idea out there and, you know, you create MySpace and Friendster and Zuckerberg's like, I can make that better. Well, that's the way, you know, entrepreneurship works. It feels crummy. It feels horrible. Now, VC should behave better. Now, you don't know if this VC is actually pumping you for information. When you go to meet with the VC and you meet with upstanding VCs, you should ask them that question. Are you looking at any other investments in the space? Well, if you were a VC, wouldn't you look at the five different companies in the space and pick which one you thought had the best chance of success? Regardless of the fact that one might have come after the other or copied or been inspired by the other, that's a VC's job. So I understand the VC's point of view. The question is, will the VC then give all your information that you talked about to the other person? And is that information in any way proprietary? For example, if I was pitching Lyft or Uber to a VC and they said, oh, you know what? We think at some point we're going to have a button where you can order food. It's like, well, that's kind of obvious. That's not, like the ideas are not that big of a deal. Now, if you had a proprietary system for doing that, you would be very careful. That's why when people meet with VCs, they meet with them once, they give them a general idea of what's going on, but they don't share with them the entire roadmap. They don't send them the entire roadmap. You keep the roadmap, what you're planning to do in the future, you keep it very general in broad strokes. So, let's say I was the founder of a ride-sharing service and the VC said, what are you going to do in the future? I'd say, well, if we have a network of cars in a city, we think they can be used for a lot of other purposes. And we're planning to explore them. They say, oh, can you be more specific? I say, well, anything a car can deliver, we could probably do, whether that's a person or a package. Okay, could you be more specific? I say, well, you know, we don't know at this point. We're going to try and test everything. So now, I don't sound like I don't have a plan, but I do sound like, hey, I have a lot of different ideas and we're going to test them. It's all reasonable. I don't have to say, we're going to do packaged food that gets reheated because we think high-end packaged food that's made by quality all-star chefs. And we started meeting with the chefs and getting exclusive agreements with them. We think those exclusive agreements are going to get us an advantage over everybody else because they'll recognize the chef's name. They'll be willing to pay more and they can heat it up. And we have the same cars that are delivering people around, blah, blah, blah, blah, blah. You don't have to go into that level of detail or specificity that gives you the tactics. If somebody says in a basketball game, you know, we're going to shoot a lot of three-pointers. Okay, fine. That's, you know, you're going to shoot a lot of three-pointers.

SPEAKER_08: But if they say, hey, we're going to play a certain specific type of defense against this player and then we're going to try to get this person to foul out, that would be like the more detailed playbook.

SPEAKER_06: So, listen, you're learning. You know, people will steal from you in the beta. You may want to put a little NDA in there, but there's really not much you can do. You can't really protect ideas. You have to win in the marketplace. But I think calling out the other companies is another strategy because you'll both get a lot of attention and the space will get a lot of attention. So if it's me and I'm a hyper-aggressive guy when it comes to this kind of stuff, I don't like when people steal from me. I had one guy steal from me. I really took him to task on it, made it very public. If somebody steals from you, I think you're well within your right to take the picture side-by-side and say this person was in our beta. This person copied us.

SPEAKER_08: And I would even, like, if the VC doesn't give you the answer you like and you're really aggressive, you could say, and we think this VC, if this VC does invest in them, you could tell that VC now, are you going to invest in this company?

SPEAKER_06: And did you know that they copied us? And they copied us pixel for pixel. And take a look at this blog post. Because if they're willing to steal from us, I wonder what they will do when you're partners with them. I wonder if they'll steal your money or steal your shares in the company or try to figure out a way to cheat you because they're cheating us. So I'm aggressive. I'd write a blog post and I would show, I put arrows and show pixel for pixel how it was stolen. And just say, we realize that there's a lot of people out there who steal, but we found this pretty egregious. We worked really hard on this and we really wish that this person, Joe Blow, would have come up with their own original idea. Mix it up. Protect yourself. Be a little bit of a fighter. Don't sit there passively and let people steal from you. If one person steals from you, God, then everybody's going to come in the store and steal from you. That's what I learned. You make an example out of the person who steals from you. I don't even want to tell you what my dad did to some guy who reached over at his bar in Brooklyn and took a bottle of vodka out of the speed rack. I could tell you what my dad did with him. He dragged him out of the bar by his face, beat his head into a mailbox. I would never advocate doing that. But in Brooklyn in the 70s, if somebody steals from you and you don't take decisive action, you're going to have somebody come in with a gun and rob the register next.

SPEAKER_36: At least that's the way my dad taught it to me. He could be completely wrong and I'm giving you terrible advice.

SPEAKER_06: But I'm a fighter. If somebody steals from me, I'm not going to go for that. I'm going to make an example of them. No stealing. Not cool. You should confront that founder. And you should tell the VC. I'm really, you know, concerned that this other company stole so blatantly from us. And I'm concerned that you might think that they actually originated the idea. I'm sure as a venture capitalist, you would rather invest in the people who actually have the creativity and will continue to innovate as opposed to the person who simply stole from an innovator like us. Huh? Sounds pretty good, right? Who knows? Maybe it will work. All right. This has been a great episode of Ask Jason episodes. If you have questions, you can email askjason at launch.co, askjason at launch.co. Or just say, at TWI startups, here's my question. We'll get a video from you and we'll play it and you'll get a plug for your company, all that kind of great stuff. Okay. We'll see you next time. Bye. Bye. Bye.