SPEAKER_00: This Week in Startups is brought to you by DesignCrowd, best custom graphic, logo, and web designs for your business. Get $100 off your design project at designcrowd.com slash twist or enter promo code twist. And AdRoll, the most widely used retargeting platform in the world with over 25,000 advertisers. Get started with $100 credit at adroll.com slash twist.

SPEAKER_03: Hey, everybody. My favorite type of episode here on This Week in Startups is the Ask Jason episodes. We used to do these a lot because we didn't have Emmy award-winning producer Jackie and we had no producer, really. So when we couldn't get a guest or a guest canceled, we just would get a bunch of questions from Twitter or Facebook or email and we would just answer them. It was filler content, let's be honest. It was easy to produce. But now, with 100,000 people watching every episode and, hey, listen, it's seven, eight years later. I'm a lot more famous. I've done a lot of angel investing. When I started the show, I really wasn't doing a lot of angel investing. I get questions constantly. When we get questions, we tell people, hey, email askjasonatlaunch.co, askjasonatlaunch.co. They send in their questions and we save them up.

SPEAKER_04: And so today, we're going to try to rifle through a dozen questions or so. These are common questions for 2016. Some of them will be timeless questions. Some of them will be very much about the moment. So let's get right into it. Our first question is from Patrick. And Patrick asks, can a startup with some failures woo new investors for future products or product releases? Patrick, this is a great question. Because what you're combining here is the natural process of startups, which is pivoting, iterating, and dealing with failure with the other parallel process that occurs raising money. You have to be able to do both of these things and you have to be wise about when to do them. Here's what typically happens. A startup has an original idea. They iterate on it. They raise money. They try it out. It doesn't work. They iterate on it. And iterate means just, you know, like small changes. They refine it. Go from version one to 1.1, 1.2. Sometimes they do a wholesale pivot. And the pivot can be small. And when the pivot's small, I call it iterating on the idea. Same idea, just iterating on it. When you pivot, a lot of times you're saying, hey, I'm taking what I've learned here and I'm just going to totally, you know, change into a new idea. So a big, a major pivot. Okay. We started, we were going to do enterprise software. Then we decided we'd do Airbnb, et cetera, et cetera. So if you go to an existing group of investors and you say,

SPEAKER_03: hey, I did inside.com, the app, which we did. And what we learned from the news app business was the news business. People love news. They love curation. They didn't like the app. They didn't use the app. Only 1% of people use the app. Why? Well, people forget about all these other apps on their phone and they use the top three or four apps and they're done. Then we said, hey, if we email that list of people, I wonder if we just email them the news with the oldest platform ever email, if they will respond better. Turns out 40% of people who signed up for the inside app would open

SPEAKER_04: the email. In other words, 40 to 80 times more usage. And it costs 1 10th the price. So it was massive leverage. Now I couldn't raise money from those investors based on that pivot. However, after we launched four or five newsletters and we had our NPS scores and we had a bunch of data, we went back to the investor and said, hey, we think there's a real business here. And they put a little more money in. If I had gone to them exactly after failure, we have a hard failure. Now we have another idea. I probably wouldn't have been able to raise the money. So what you really want to be able to do is have enough runway that when you do that pivot, you can get that traction, that data and present a full case based on it. Because let's face it, if your business didn't work and I got you to put money in and I'm telling you, hey, the business I told you to invest in doesn't work, you don't have credibility. You have to rebuild that credibility. And so I think what does it take to rebuild credibility? It takes data. It takes customers. It takes data that shows engagement. What is engagement? Engagement is people actually using your product. So very hard. You're almost better off shutting the company down, taking six months or a year to work at Facebook, Google, Uber, whatever, licking your wounds, coming up with another great idea, building it on your weekends, and then going to your existing investors and new investors. Listen, there's more investors you haven't raised money than you have already raised money from. So you can always go out and do another idea. So there's two schools there. One, shut the company down, let everybody take a tax loss, and then regroup, get your energy back up, find a great business, and then start with a new cap table with new investors. And maybe some old investors will come back with you if you acted classy and you gave them updates. But yeah, I mean, failure is a common theme amongst entrepreneurs. And as long as you learn from those failures and you act classy and you stay informed with your investors and you inform them of what's going on, you'll be fine. You will get them to invest again. I like to invest in the arc of a founder's career. So if I see a founder do great work two, three, four times, I'll invest in them two, three, four times. Because if I'm not investing in the business, I'm really investing in

SPEAKER_03: you. So great question, Patrick. Here's a great question from Sarah. How does an introvert self-promote? Great question. I am a massive extrovert. You know that. I host a podcast. I think introverts have to learn certain skills of extroversion, which include looking people in the eyes and introducing yourself, which include hosting a dinner party, which include hosting a meeting. But you have to understand as an introvert, I believe, and I'm not an introvert, but I hear this from introverts is to replenish your energy after using up your battery. So if you're an introvert and you go to a party, you need to know, like, listen, after two hours of being at a party, I kind of don't dig it anymore. And I want to go home and play video games or read a book or binge watch something and just be by myself. If you know that, you can time it and say, you know what, I'm going to do 90 minutes at the party and be my best. My wife is like that. She wants to not be out for 10 hours when there's a party. I want to come half an hour early on. I want to be the guy who stays two hours late at the party because I just love talking to people. I mean, look, I've done over 600 episodes of this podcast. I love to talk. I love to have conversations.

SPEAKER_04: So writing is a great hack because with writing, you don't have to look somebody in the eye. You don't have to talk to them. You don't have to have your batteries drained. You can just write your position and you can share the Google doc with five friends and say, hey, use the commenting feature in Google docs or the commenting feature in Evernote and give me some feedback on what I wrote. So that's a way for an introvert to be extroverted. Some people who are introverted are just awesome, you know, on their hip chat channel or their Slack channel. They just love being in chat. That's why I believe these things took off amongst developers. A large number of developers, I've seen the statistics, like are introverted, right? And they would feel more comfortable talking in chat. So if you get people to talk in chat, then their introversion becomes

SPEAKER_18: less of a, you know, a downside for them. It becomes, you know, more powerful. So I think

SPEAKER_04: you just have to know yourself. Chat is great. Writing is great. But I don't think that introversion is a disease. I don't think it's a malady. It's just a style. And just like an extrovert can learn to shut up and listen, which I have had to do in my life. I've had to learn how to be a great listener. You'll see that on episodes of this podcast. If you watch the early ones when I'm interviewing people, sometimes I ask them a question and they start to answer it, I answer it. Other times, then towards the middle, the 200 to 400 episode, maybe I became 50-50. And then you'll see me in the later episodes, I'll ask a question of a founder and people are like, I know, I really want

SPEAKER_18: to know Jason's opinion on that. Why isn't Jason talking? I'm like, well, in an interview, I'm not supposed to be talking. So you'll see me say to Steve Jurvetson, food, energy, solar. And I just said one word to him and he would go flying off the handle, right? That episode is Steve Jurvetson's episode, not the Jason Calacanis episode. So extroverts can learn the introversion skills and become better human beings, better leaders, better founders, just better humans. And introverts can learn how extroverts work and really just identifying yourself. If you've never taken the

SPEAKER_03: Myers-Briggs, I think it's a great thing to do because you, nobody is just one thing. It's very rare to have somebody like Luke on my team who's a hundred percent extroverted or me 84% when we took our Myers-Briggs on our offsite, you know, we were like massively out there. That's why Luke and I laugh

SPEAKER_04: and go out and do partnerships for launch all day long and enjoy lunches and can't get enough of it.

SPEAKER_18: You want to just understand all your teammates' styles. And if you have a teammate who's an introvert, it's really important in a meeting to just say, hey, we haven't heard from you, John, Jane, Billy, Susan, what do you think? And that's really the best meeting technique,

SPEAKER_04: I think, is making sure everybody who's in the meeting gets to have their two cents. In fact, there's some people who run meeting styles where everybody has to talk at least twice in the meeting. So if somebody didn't talk, somebody who's in the meeting has to put a hash mark next to everybody's name. Hey, Jackie, we haven't heard from you. Can we get your opinion? Hey, Ashley, we haven't heard from you. Can we get your opinion on this? It might just be, yeah, no opinion sounds good to me, but at least they had an opportunity to be heard. So I think that's the best way to self-promote. The best self-promotion is success. If you're successful, people will find out about it. And it's good to commemorate your success.

SPEAKER_18: So I think taking the time when you release a 1.0 to write a blog post about it, or a Medium post, if you hit a certain number of customers to tweet it out, it's a great thing to do. To do a Quora Q&A, right? To do a LinkedIn influencer post.

SPEAKER_04: So celebrate the milestones is something other people don't do. So when your company hits its first year anniversary, make a slideshow, make a slideshare, whatever. When you hit your thousandth customer or you break 10,000 daily unique visitors, go ahead and write a blog post about that and what you've learned. Share a little bit about yourself and celebrate the victories. Because let me tell you something, entrepreneurship and startups, it's more pain than it is celebration. So when you get

SPEAKER_03: those moments to celebrate, go ahead and crack the champagne, make a big deal about it, and let the world know, hey, and be humble. You know, when you let the world know that you've hit a certain milestone, hey, you know, Uber's hit 10 cities. This is a great foundational moment for the company.

SPEAKER_04: And we're on our way to a thousand cities. So we're going to add a zero. We're going to add another

SPEAKER_03: zero. So when you ever, you celebrate those moments, those milestones as an introvert or an extrovert, you can write a blog post. You can do a tweet. You can even do a podcast. You could have a party. Any of those things. When you do have that, the dinner or whatever, a brunch, you want to make

SPEAKER_04: sure you are humble and say, hey, this is what it means. It means we've reached this point in our mission and restate the mission. So great question, Sarah. I really enjoy that one. Visit designcrowd.com

SPEAKER_18: slash twist and save up to $100 on your design project. If you don't know, designcrowd.com is a place where you can, it's a marketplace and you put up what you want to design and a bunch of designers go compete and build you a great logo, designs for your website, et cetera. And they've got over 500,000 registered designers from around the world. It works really simple. You post a brief, hey, here is what I'm looking for. And you'll receive 60 to 100 different designs or more. And you then provide feedback and you get changes so you can go back and forth. And then you select the best design and approve payment to that designer. And if this all sounds scary, like, oh my God, I've never done it before. Don't worry. There's a money back guarantee. And I did it for my website, calacanis.com. And for $500, we received over 350 designs. I'm not sure you're going to receive 350. I did tweet it. So maybe you'll receive 60 to 100, but it was amazing. We got a ton of great icons and illustrations and portraits and bulldogs. You can go see it if you go do a search over there. And you can help me select the winning design by voting at designcrowd.com slash twist. Their other clients include Harvard Business School, the old HBS, Virgin, HTC, Absolute Vodka, Amnesty International, which was my first job out of school, and over 100,000 other small businesses. So here's your call to action, everybody. Go to designcrowd.com slash twist and save up to $100 on your design project. Give it a shot. You're going to love it. I guarantee it. Designcrowd.com slash twist, and you'll get $100 off. I guarantee it, but I don't have to guarantee it because they guarantee it. It's got a money back guarantee. DesignCrowd, it works. It's awesome. Go ahead and visit at DesignCrowd. Oh, go ahead and follow them on Twitter too, at DesignCrowd. Okay. Here's another question. This one's from Aaron, and it's around pricing. What is a no BS,

SPEAKER_04: a no bull sugar way, a data-driven way to approach pricing when your competitors' pricing models are not freely available? Okay. There's really two questions here. One is, how do you price your product, right? The second is, how do you get intelligence about your competitor's pricing? Because right now you're saying it's not freely available. So there are firms, and there are clever ways to get pricing. Now, you don't want to be ever unethical, but would it be unethical for a friend of yours who could possibly be interested in your competitor's product to go through the sales pipeline to evaluate it? And they would take notes, and they would ask them about pricing, and then compare your product and give you feedback on what they heard. If you don't think your competitor is doing that with you, you're naive. There are firms out there that do this. They say, we're doing market research, and they call and they ask questions about companies.

SPEAKER_03: There are people who hire market research firms to go find out information about their competitors. The other trick that people do, and listen, I'm not endorsing any of these tricks. I'm just telling you candidly how the world works. Okay? I'm not telling you I would do this or not do it. I'd advise you to do it or not do it. I'm telling you how the world works. Another thing people do, they love to interview people who worked at a competitor, and they get them into the first interview. Everything's great. They get them into the second interview. Everything's great. Then they get to the third interview, and they try to get them loosey-goosey. Maybe they take them

SPEAKER_12: out for a lunch. Maybe they have a couple cocktails, and they just start talking. Hey, so what was it like

SPEAKER_03: there? And then all of a sudden, the reason you're being interviewed becomes clear. They're trying to pump you for information about what life was like at your startup. This kind of stuff happens all the time. They may not even have an intention of hiring you. They may just have been stringing you along to get that information. So people do this kind of competitive stuff all the time.

SPEAKER_04: Another thing is to talk to your existing customers and say, hey, did you ever evaluate any... And you don't want to put the stuff in email. So people who do these kind of tactics, again, I'm not endorsing them. I'm not not endorsing them. I'm telling you how the world works, candidly. You have a customer, Acme. Acme uses your product, your beta product. They also... You could ask them, hey, did you ever try the Delta product or the Gamma product from our competitors? They say, actually, yeah, we were Delta product, and we met with Gamma. Oh, that's great. I always wondered how we might... And you would do this in person you would talk about, you know, the stuff on email, right? Assume every email you ever write would be... Every email you write would be out there for the public. You should assume that because eventually every email will be out there. If you haven't been paying attention, if Hillary Clinton can get hacked, the Russians can, you know, release everything. Everything will be released at some point, including your emails, even if they're insignificant. So your current customer base could get you intelligence, and they may or may not feel that's ethical. If it's stuff like a brochure, it doesn't feel too unethical to ask what the competitors are or to ask them, hey, why did you do this? Why did you pick this company? Why didn't you pick that? Why did you pick us? Now, pricing is one of those

SPEAKER_03: things that most entrepreneurs underprice their product. Why? They want to be loved. So I can put aside competitive intelligence. And there are some even darker web competitive intelligence things, like there are sites that allow you to spy on another person's website and see if any pages change.

SPEAKER_04: They will email you the changes, the deltas. You can look up web page change detection software,

SPEAKER_03: where they go and they search those other websites and see if there's any changes. So if something changes on their hiring page, you get the alert, hey, there's a job that's been added. Now that you have that job, you know, oh, they're hiring somebody for this position. You get the idea. So people follow

SPEAKER_04: people on LinkedIn. People try to get competitive intelligence on LinkedIn all the time. So there's many ways to get competitive intelligence. Now pricing, most people charge more, less than they can. So you

Chamath Palihapitiya: want people who will test charging more. Go ahead and tell your sales team to have a VIP program or to

SPEAKER_04: charge more to test marketing materials at a higher price and see what happens. Double your price, triple your price. And one of the great things you can do is just ask people, candidly, we're thinking about raising our prices. If we made this instead of $5 a user, $15 a user, how would that impact your usage at all? Because it would be very small, but we want to invest more on the product. Sometimes a candid conversation like that between the sales or marketing team or even the CEO or a research team and the customer can lead to an amazing moment. Yeah, I think you're underpricing. I would pay not 100, I'd pay 200. Sometimes people have so much money in their budget and you don't know how much

David Friedberg: money they're saving. So great question. Let's continue on. All right, here's a great question

SPEAKER_04: from Dylan. How are your portfolio companies tackling growth? There are two major issues right now in the startup world. It's not how do I come up with a great product idea. It's not how do I build a great product. It's not how do I find a team. It's not how do I find customers. All those things kind of exist in the world, right? And it's very often not what's the technological solution here. Most of the technology is out there. Most of the customers are sitting out there. Really, how do I acquire those customers, right? How do I get to them is the issue. How do I retain them is another issue, right? And how do I raise money? So we'll put aside raising money.

SPEAKER_18: Tackling growth really, there are two different ways people go about it. One is maintaining your

SPEAKER_04: existing customer base. In other words, you have customers, you want to retain them. So there's a whole science of retention. Your best customer is an existing customer. If you don't lose a customer, in a way, you've gained a customer, right? You don't want to lose customers. The way to not lose customers is to study their engagement. If you're studying the people you've already brought into your product, and you study them, and you find out they've stopped using the product, you've got to go talk to that customer. Say, hey, you were using the product, you stopped. Why? Whether it's a consumer product or a SaaS product. Whether you're charging them or it's free, you need to know why they left. So as an example, when people leave our email newsletters, we send them, hey, a confirmation message. Yes, you've been removed. We would like to know, why did you leave? I left because I no longer need this information. I left because you're sending me too many emails. I left for this reason. I left I'm no longer interested. Whatever it is. That exit interview, which could occur in a form, or it could occur in an actual interview where you call the customer and say, hey, I saw you canceled. Can I just ask you three questions? When did you think you were going to cancel? Why did you cancel? Do you have enough? How are you going to solve for this problem in the future? That's very important.

SPEAKER_03: Now, how do you get new customers? Most people are building a team, a growth team inside their company, and there's a big debate. Should you have dedicated growth people, or should you have a growth culture? Sure. Both of these models work. Having a person who is responsible for growing and getting people into the funnel, that works. Having a system where you have everybody in the company focused on growth, that also works. Either one can work. But here's what doesn't work. Ignoring growth. Not tracking your metrics. So you have to spend time investing in your infrastructure, and you have to know, hey, how many people are listening to this week in startups? Okay. How do new people find out about the show? Hey, are we collecting emails? Are we collecting emails in these different places? When's the last time we asked our Twitter or Facebook followers to give us their email? Hey, when's the last time we emailed our list? Right? When's the last time we tweeted? Is anybody

SPEAKER_04: retweeting us? Right? So what typically happens in your organization is you hire people. I have Emmy award-winning producer, Jackie. I have Jake. I have Ashley. All these different people who work on this week in startups. They didn't have growth or marketing as a job description at their previous companies. Right? Nobody did. It's only now in this ultra-competitive startup environment that you have startups where all the different job positions are thinking about growth. And that's great. You want everybody in the organization, in my opinion, to learn how things grow. So I'm forcing everybody in my organization to understand how social media works, to understand how SEO works, to understand about how paid traffic works, to understand how to put a Facebook or Twitter ad up, to understand about open rates on email. The right people will embrace this. The wrong people will be scared. If people are scared, you got to sit them down and say, hey, listen, I know that you haven't done this

Chamath Palihapitiya: before, but just because you haven't done it doesn't mean you can't. And if you learn this skill, you will become part of the elite group of soldiers in the startup world. In other words, you can go from being a private in the army to being SEAL Team 6. You can be a ranger or you can be a marine. You can move up the stack and be more elite. Who doesn't want to be elite? Lazy people. If somebody fights you on being elite and they refuse to learn how to do growth, they're not elite enough to be on your team.

SPEAKER_04: And you should have a candid conversation with them. Hey, Producer Jackie, I know you have four Emmys,

SPEAKER_03: but we're a podcast. We're up against other podcasts who are learning how to do growth. I need you to learn some of these growth techniques. And to our credit, Jackie's learned how Twitter works, how Facebook works, how clips work, how collecting emails work, all this stuff that maybe when she was at another company getting her Emmys, they didn't actually require. Everybody in the world who wants to be elite and work in startup culture has to understand the fundamentals of growth. And it's the job of the leader to set the tone. If I don't set the tone that everybody's responsible for growth and I don't understand how growth works, then it's just me yelling at a bunch of people on my team, hey, make it grow. You all have to get in it together and learn the skills of how to grow your company. That all starts with understanding your customers and why they watch your show. If you know people are watching This Week in Startups because they want to learn or they want to understand how investors think, or they want to be inspired, it makes it a lot

SPEAKER_04: easier. And how do you learn that? You ask them, why do you watch the show? Anytime I meet people, when you come up to me and say, hey, Jason, I love the show. Anybody who's come up to me and

SPEAKER_03: says that knows the exact thing I ask them. Who's your favorite guest? What do you like about the show? What have you learned? I always just ask them a couple of questions. So I know what they like. Makes sense, right? So I think the way my companies are doing it is they're generally making everybody in the company aware of customer acquisition and customer retention, right? How do we engage these customers and retain the ones we get? And how do we get new ones into the funnel? And if everybody

SPEAKER_04: understands that that's the goal and growth is the goal of the startup, well, then you can be freed. We're not here just to tape episodes of This Week in Startups. We're here to tape episodes of This Week in Startups and get people to watch them. Taping the show is half the battle. Putting together a great show is half the battle. Getting people to that show is the other half, right? I have to deal with this exact issue, Dylan. So thank you for asking your question. Hey, everybody. I want to take a moment to tell you about retargeting. This is a very, very important thing for startups to understand because customer acquisition is what it's all about. And AdRoll is the best retargeting platform on the planet. Over 25,000 advertisers use it. And I want to tell you today about a new product they have. It's called SendRoll. No, it's not sending to get your rolls and buttered rolls. No. This is about email. And SendRoll lets you get all those people who are window shoppers, people who are checking out your website, and then you can convert them into buyers, which is what you want, getting them to sign up for your product or service by email. So imagine they visit your site, but then they get an email follow-up. SendRoll is powerful retargeting tech plus effective emails. And the results have been spectacular. The average SendRoll gets a 45 to 60% open rate and a 10 to 20% click through. And I can tell you runninginside.com that that is probably three times, four times the industry average. And it's so easy to set up a SendRoll campaign. It just takes minutes. They give you all the templates and they have a 24-hour, seven-day-a-week customer service line if you need help. And what I always like to do when we have somebody who has a product that's loved on our program, we don't want to read any sponsor messages, any partner messages for things that are not loved. The great part is a lot of my founders from my portfolio use AdRoll, so it's very easy for me to talk about their new products, SendRoll. James Heller, the founder of Rapify, which went through my incubator, says, AdRoll is an integral part of our customer acquisition strategy. It allows us to continue to garner impressions long after the initial customer interaction. It's also one of the most cost-effective tools to bolster any integrated marketing strategy. AdRoll is the best retargeting platform, period. That's according to James Heller, good friend of mine and one of my investments at Rapify. So here's your call to action, everybody. Try SendRoll and get a $100 credit. Just go to AdRoll.com slash twist, AdRoll.com slash twist, AdRoll.com slash twist, and get that $100 credit. And please try that SendRoll

SPEAKER_39: and give them some feedback and let them know that Ad Jason sent you. Okay, let's get back to this

SPEAKER_04: amazing program. Okay, our next question is from Erin, and she says, should founders pay themselves while they are in an accelerator program and afterward, factoring this into account when they raise their seed round and hire their first employees, or are they expected to live off their savings until they reach traction and revenue? Great question, Erin. Certainly, I can tell you what's

SPEAKER_18: not expected. Number one, nobody expects you to go bankrupt and put your life savings into it and go into debt. That's how it used to work. And even that's how it works in some countries that have a pathetic track record of creating startups. If you go to a country in Europe that's socialist or quasi-socialist, they will require the founders put themselves personally on the hook for investment dollars put into the company, for the employees severance packages, all this stuff. So they have a non-fluid entrepreneurial market that disincentivizes people from being entrepreneurs. That's why you don't see a

SPEAKER_03: lot of great companies. We're all changing, large, rabid entrepreneurship coming out of France or other countries in Europe. It's easy to pick on the French because it's pretty socialist over there.

SPEAKER_18: Now, so nobody expects you to go bankrupt. I have seen people put money on their credit cards. I put money on my credit cards to start Silicon Valley Reporter. So it's a pretty good sign for me if you are putting some skin in the game, as it were. Again, people don't expect you to go bankrupt. Now, when you're in that accelerated to your first question, usually they give you what's called ramen money, enough to buy basic nutrients. So you're not going to live like a king or queen, but

SPEAKER_04: hey, you might have two or three people in an apartment meant for one or two people. Hey, you might be eating ramen. You might be working seven days a week. And you might be paying yourself what's called a draw. Just a minor amount of money to live on. So you say, hey, we don't have a lot of money. We're poor. We came into this. We have 10K in the bank each. We're going to draw 2K each a month, 25K a year. We're going to draw 5K a month each, 60K a year, much less than you would at your other job. So if you want to be an entrepreneur, you have to put everything in context. You're not going to get max money from a company that's buying you

SPEAKER_18: out like Hooli, AKA Google. You know, they have this whole joke, Hooli, everybody's on the roof, hanging out, getting paid for doing nothing. That's a direct reference to Google overpaying people. So even just to keep them in the tent, right on the roof, as it were. So nobody expects you to go broke. Although it's quite charming when a founder does go broke and put their savings in, it can be stupid, but it also can be quite charming if it works out. I mean, history defines how we contextualize these things. So a draw is pretty standard. It's a negative signal

SPEAKER_04: when a founder pays themselves too much. So generally speaking, if a founder paid themselves

SPEAKER_03: $100,000 in San Francisco, people would be like, okay, it's an expensive city. Would we rather see yourself live in San Bruno or Daly City or Pacifica, wherever, East Bay, and pay yourself 50 and, you know, live off a little savings? Of course, you want to put every dollar possible into getting, as you mentioned, product market fit and traction. So I have been involved with startups. I look at their cost structure. I asked them what they're going to burn now. I'm a seasoned angel investor. I say, hey, when you raise this 500K, how far is it going to take you? And they say, well, we have five team members. So I say five team members. I put it at 4K a team member, 5K a team member. I say four or five team members. Okay, you're spending 20, 25K. They say, no, I have five team members, spending 50, 10K each. I go, oh, I don't know if I want to be involved in this startup because although they're paying everybody adult salaries and those people are worth it, if they're all getting paid $100,000 and they're in a startup and they're not equity incentivized and they need to, they may need to make this runway last 12 or 18 months. So maybe if they're, that money's only going to last five or six months, I'm just going to have them coming back to me to refill another, you know, 10 months, $500,000. I can't do that as an angel. I have a small chip stack. So, um, you want to spend as little as possible. You want to live frugally and you want

SPEAKER_04: to get every dollar into that product. This is why it's infuriating for me when I hear startups go to this dopey web summit and spend not only, you know, three, four, five, six, seven, eight thousand, $10,000 after being selected to come and getting a pair of tickets and a table. Then they also spend thousands of dollars on hotels and flying out. And even worse, they spend two weeks of their lives, a week getting ready for this, a week going a week afterwards to recover, where they go to this dopey summit at sea and they party all weekend and think they're going to find a customer there, even though all it is, is a bunch of founders and a bunch of people selling into founders. You get, you waste all this time and money. Time is the enemy. Cause remember, as time goes on, your expenses are still going. Your AWS or IBM cloud bill is still going. You know, your, um, salaries are still going. So time is the enemy. If you have, you know, 10 months of runway, that's like saying you have 40 weeks. If you go waste three or four weeks doing conferences that don't result in actual customers or investment. Oh my God. You have to pick the most efficient amount of time, the most efficient solution in terms of time and money. Cause time

SPEAKER_03: is money. You have a certain amount of time. You're not racing against competitors. You're racing against time. In most cases, the time you need to get that product to market, the time you need to find customers, the time you need to train them how to use your product, the time you need

SPEAKER_04: for them to fall in love with it. And for you to get those traction metrics to get the next round of financing. So take as little as possible. Most people, a lot of these programs now are,

SPEAKER_53: are a hundred K 50 K, right? So at the launch incubator, I give people 25 K when they come in 25 K when they graduate. And if they want to, uh, we syndicate them. And sometimes the syndicate

SPEAKER_04: does a hundred K sometimes it does 500 K we'll see. Um, that keeps changing over time.

SPEAKER_18: Something to keep your eye on as well. Um, I've seen people now go to multiple incubators because they need that next hundred K. They're not going cause they think the incubator is going to give them great advice. They're literally growing just because they want to get the hundred K, which I think is a bad signal, right? Like if you're not going because you're going out of desperation. So you have to be a little bit careful. Uh, when you see companies like that, sometimes going to three or four incubators to maybe two incubators, three incubators, it's great if your other option is going out of business, but it's also could be a negative signal. If you can't raise money from real investors, maybe something's wrong, right? And if I introduce you to 50 investors, you know, during the course of an incubator and you see another 50, when you graduate, you get to a hundred investors and zero want to invest out of a hundred,

SPEAKER_04: either something's wrong with you, the product, the market, or me for betting on you, the product in the market, or all the VCs and investors we met are crazy and don't get it. It is a possibility that 20 of 25 or 24 out of 25 might not get it. It's unlikely that 100 of a

SPEAKER_45: hundred would not get it. If you're meeting world-class investors from Silicon Valley.

SPEAKER_55: Great question, Aaron. Good luck. Okay. Next question is from Brian for a three-person B2C

SPEAKER_04: business to consumer startup embracing the lean startup principles. How long should we give ourselves to reach ramen profitability around 6,000 per month for us before conceding that we won't reach product market fit with current approach and should instead move on to the next idea? Great question. Lean startup is an awesome, uh, methodology. Uh, and there's a lot of other methodologies there for startups, a lot of different ways to think about them, but for a B2C company, um, reaching ramen profitability is not actually the goal for a B2C product. It's not about, can you make 6K a month? It's about how many people are using your product? What's the retention? In other words, how long do they stick with it? How fast is it growing? And also how many minutes are they using it? So you tell me, Hey, I've only got a hundred users. I say, Oh, only a hundred users. Uh, that's not too many. And you say, but they come back seven times a day to use my app and they're in the app on average for eight minutes. I say, wait a second, they're coming back six or seven times a day and they're in it for eight minutes. Oh, that's Twitter. Twitter is just highly addictive or Instagram, highly addictive. People are opening up three, four, five times a day. MySpace, a company like that, what they found was my space had more users at a point in time than Facebook. But when you peeled back the onion, people were going to Facebook four or five, six times a day, people were coming to my space twice a month. They would get like a little email that was saying like, you have a message. They click on it. They go to the site. The message was stupid. It was spam. They would leave, right? So the devil is in the details. What you're looking for as a B2C, uh, product is how long are people using it? What's the retention like? So if you got, if 50 people use the product today

SPEAKER_03: in that cohort, the Monday cohort from this week in 2016, how many were using it 10 Mondays from now from that Monday, right? How many people stuck with it? That's the key. If you can show, hey,

SPEAKER_04: people are still using the product and some group of people are using it a lot. All of these things can add up to going to an investor and saying, look, based on this trajectory, we know we can acquire customers for this amount, or we know that one person tells 1.2 people or viral coefficient about the product. So therefore we're going to grow and here's what it'll look like. We know people use it six or seven times a day already. We know there are this many more people out there like this. So yeah, you know, some, some things get massive, uh, usage like world of Warcraft. People play world of

SPEAKER_53: Warcraft for five hours a day for 30 hours a month, for 30 days a month. I mean, they're playing

SPEAKER_04: 200 hours a month, right? It's like a full-time job, a hundred hours a month. Oh my God. That's incredible. How much are you monetizing them for? Oh yeah. They're paying $15 a month. Great. That really looks interesting as a business, right? If they were playing for 10 hours, it would be costing them a dollar 50 hour, but they're playing for a hundred. So it's costing them 15 cents an hour. That's amazing. You're monetizing them for 15 cents an hour and they're playing for a hundred hours, 200 hours a month. Fantastic. There's something there. Okay. Now we just need to know how big can this get? Oh, well, it peaked out at 8 million people paying that $15 a month. Hey, wow. It's a pretty big business, $600 million a year. If it would only peak out at 8,000 people, Hey, maybe it's a little tiny business, right? So that's what we're looking for as investors. We're going to look into not, can you hit 6K? That's more for a B2B company. In a B2C company, you don't want to even think about monetization. I mean, you might want to have an idea of how you'll do it, a theory. Okay. You know, Instagram is going to do beautiful pictures and Vine is going to do sponsored six second and seven second loops for Oreos or chocolate milk or, you know, for cars. And, you know, uh, people are going to do watches and fashion ads on Instagram, right? You can understand like, okay, we have a certain theory. We'll charge people by the loops on Vines. You might have some clever theory about how your advertising will work. Maybe you'll do lead gen. You're not really executing on that until you hit some level of criticalness. Tens of thousands, hundreds of thousands or millions of users per day in all likelihood. What you're really looking for is not

SPEAKER_03: ramen profitability, because if you're looking for engagement and growth and how's it growing week over week and studying that, and that's why you have to have a growth culture. Everybody in the team has to figure out what your KPIs are, what the key metrics are, and you have to try to grow those key metrics and understand why they're growing. Then that 6K a month in ramen profitability, well, you know, that's only 75K a year. You can go to any angel and get that if you show growth. Focus on growth in those early days of a B2C customer. It doesn't need to be a lot of people. Better to have a small

SPEAKER_04: number of people using the product a lot than a lot of people using the product not so often. Great question. Okay, here's a great question from Pat. How does a startup continue to develop without revenues when all angels and VCs are now asking for MRR, monthly reoccurring revenue,

SPEAKER_18: as the measure? It's not true that everybody's looking for MRR as the measure. Some B2C companies would be judged on growth, right? Snapchat, Instagram, Facebook, none of these people had

SPEAKER_04: monetization turned on for years. They were just looking at growth. When they do want to look at

SPEAKER_03: MRR is in later stages for consumer products, but early stages for enterprise products, because for enterprise products, business-to-business products, you want to know that they can make money.

SPEAKER_04: You want to know that people are willing to pay for it. So I don't think it's true that you won't be able to raise money for all companies without MRR. What you do need to do is you need to show that either you have a track record or that you execute at a high level, or that some core group of people are absolutely loving and delighted by your product. If you can't raise money without MRR, it probably has something to do with you and your execution. Now, that's tough love and it's hard to say, but the truth is you need to have some level of performance. The performance can come from your past companies. Listen, if I'm going to go start a new company, I'm going to be able to raise three or four million dollars based on an idea because I've done this so many times. If Mark Pincus or Evan Williams is going to start a new company, they're going to be able to raise 10, 20, 30 million dollars just based on a deck, an idea, having a couple of conversations. I've had VCs come up to me and say,

SPEAKER_03: four million on, eight million pre, go start another company. And I say, well, I'm not starting a company. They say, well, when you have your next idea, that's be the terms. I'll just buy a 30 year company. I want to be on the board of your next company, which is very charming and very nice.

SPEAKER_04: But the fact is, if you are nobody with no track record, okay, yeah, you need to show something. What can you show? If you can show that you have engagement from customers, if you can show a couple of customers who love your product, if you can show exceptional design, if you can show a clever business

Chamath Palihapitiya: model, that might get you some funding. Now you can run a startup without money from angels and VCs.

SPEAKER_04: You can do contract work. You can do a white label product. You could work at a star at a big company and do, um, your project on the weekends. If you're a developer, you can do, you know, a hundred dollar an hour, $300 an hour developer work on Gigster or any other platform, and then use that and invest it in your startup. So boo hoo, you can't raise money from angels and VCs. That's your job. Don't blame MRR. Take a deep look in the mirror and realize that you don't have the right to be an entrepreneur just because you want to be, just because you showed up. You have to earn it.

Chamath Palihapitiya: If you want to be a Navy SEAL, you've got to be able to get in that pool, get in that ocean when it's ice cold and hold up that log for days at a time. You have to have a hose in your face while you're trying to clear your mask. I mean, it's not easy. Step it up. World-class design, customers, sure.

SPEAKER_69: Growth. It's your job to get yourself above the noise. Look to the left of you, study that startup that raised money. Look at the right, study another startup that raised money and do it better.

Chamath Palihapitiya: It's not your right to just get money from angels and VCs. You're in a competition. You have to measure yourself against your competitors. And you know what? I always get

SPEAKER_69: this. Oh, that company that failed is like, that guy's an idiot and he raised a ton of money. It's like, yeah, sometimes idiots get money. Sometimes they, you know, BS their way into some big round

SPEAKER_04: of financing. You're taking like some weird occurrence that occurred and then saying, oh, well, if that idiot gets that much money, I should be able to get double that amount because I'm smarter than them. It's not how it's based. It's based on the promise and your execution, uh, the promise of what you're building, what kind of promise it shows and how well you're executing. If you can't raise

Chamath Palihapitiya: money, look in the mirror first and say, should I be able to raise money here? Do I have a track record? Is my execution extraordinary? Have I assembled an amazing team? You might not have, in which case work on your startup on the weekend and then make money selling your skill

SPEAKER_04: during the week. Okay. Here's a question from Aditya. A-D-I-T-Y-A. Aditya. I hope I'm pronouncing that correct. Um, hope, how open are you to non-tech startup ideas? How open are you to

SPEAKER_69: non-tech startup ideas? You mean like a taxi company or a hospitality company that rents your couches

SPEAKER_04: or somebody who makes couches to the inch? Of course, I'm open to all of these things. If you have a way for it to scale to a hundred million dollars in revenue, if you have any business that can return 100 times my money and you can explain it to me and we can both agree that there is a clear path to you returning 100 times my money. I give you 25,000. You give me back 2.5 million. I'm in. Let's talk about it. However, if you want to start a movie, if you want to start a restaurant, a cafe, not interested, those businesses will never, ever return 100 times the investor's money. It just does not happen. That being said, when Henry showed me Cafe X, I said, do I want to be in the business of Starbucks? Do I want to be in the business of cafes? Well, not really. I just said I don't want to be in the restaurant business, which cafes are sort of a subset of. Um, but I do want to be in the thing that replaces all those cafes and puts one in between every Starbucks and the lobby of every building in between every gate at an airport. There is a robot making coffee and it costs a hundred thousand dollars to build the machine and it breaks even in six months and it makes perfect coffee. That's better than Starbucks and gives you more choice and you don't have to wait in line. You get in 45 seconds and you've eliminated the two greatest costs in the coffee business, people making it and the real estate. I'm in. So of course I'm open to non-tech. I'm using air quotes here. Startups. I want startups that are going to grow and become big and change the world. That's it. I'm a capitalist. I base things on the return on investment and to a lesser extent, you know, um, am I personally interested in it? I don't have to be personally interested. I don't have to understand the idea. I need to understand, is it going to return to my LPs a hundred X? That's the business investors are in. They're looking for a dragon, a unicorn, a centaur, any of those mythical beasts. A hundred X, return my fund, make me a billion dollars, any of those

SPEAKER_03: things. That's what investors are interested in. So if you can look at the, and people are emboldened by the real world, you know, building a car company, building a rocket ship company, building a taxi company, building a hotel company, you know, this is what Airbnb, Tesla, SpaceX, and Uber are. Nobody would have funded those companies 10 years ago. In fact, when I introduced Uber to 20 investors, 17 said no. Airbnb tried to raise money and 19 out of 20 people said no. So, uh, the real world is where real business occurs. Food business, um, healthcare, all this stuff is on the table. Now, couches, furniture, design, everything, interior decorating,

SPEAKER_42: it's all on the table. So yeah, of course I'm open to it. Okay. Let's take another question.

SPEAKER_04: All right. Here is an incredible question from Darius. How do you decide between a B2C and B2B, uh, approach if your product can go either way? This happened with Uber actually. I had one investor who said, why don't you sell the Uber software platform to cab companies? Can you convince Travis to do that? And I said to them, I don't think you understand the cab companies are the problem. They're taking all of the revenue. The drivers are getting screwed. Customers don't want to talk to some central dispatch. They just want their car to come as affordably and as efficiently as possible. Taking out all these steps in the, uh, process will make it more delightful, more efficient and better. So you have to look at, um, two different things. One, what's going to create the better customer experience? If enabling every car on the road to have autopilot

SPEAKER_03: and to not crash is the best approach and retrofitting them like Cruz and some of these other companies we're doing, you can put it into an existing car. Great. Mazel tov. If a, you know, full stack approach like Tesla, I'm going to build the car. I'm going to build the batteries. I'm going to build, you know, material, raw materials into one side of the factory car out the other. And it has self-driving. Great. That's another approach. You know, if you can do the full stack

SPEAKER_04: approach, it could be more expensive. If you're going to sell the software to people, you may have revenue earlier. Typically you have people do both. So there was a company that made dispatch software and sold it to Bento and other on-demand services that just showed you where the driver was and track the order and all that kind of stuff. Those businesses, those B2B businesses, they tend to be smaller, but you do have like Twilio, right? Yeah. Twilio provides an API level to a layer to all of them. It generally has to do more with what is the founder's ambition? What do they want to do in the world? And every idea is a little bit different. Some ideas lend themselves to a B2B solution better because there's a ton of people in the market. Okay. We have a ton of car dealers out there. We can sell them this upgrade to their cars. We have a ton of car manufacturers. It's a fragmented market. Our customers will be these businesses. Their customers will be this end. But we had Muntry on the show. Muntry's not making food to sell in retail stores or airports or to airlines. They're saying we're going to sell food

SPEAKER_03: direct to customers. Then you have a company like Bento, which is doing packaged food as well. And they're selling to people who then, B2B to see, they're selling to people who then sell to

SPEAKER_04: customers. So either of these approaches can work. Sometimes one is a bigger opportunity than the other. You really have to parse the competitive landscape and the market. Great

SPEAKER_55: question. Okay. Our next question is from Dan who says, I'm a non-technical founder. I need to find a

SPEAKER_04: technical co-founder. Best way to go about this. Great question. Happens all the time. Here's a great way to do it. A little bit of a secret I have for you. Go onto LinkedIn. Find a company that has been sold two years ago. A year ago. Six months ago. Three years ago. So you know that this company was sold to Twitter. You can assume that those people had a year or two they had to stick around. They probably made some money. So if you worked at WhatsApp and it was sold three years ago to Facebook, those people who came probably got three or four year deals. They're probably looking for other opportunities. They might be calling

SPEAKER_03: in rich. And you start meeting with them because they may not be sensitive to salary. Right? They may be okay with

SPEAKER_04: taking a draw. They may be looking to lead something because they were at a company and they weren't the leader. So the people who live through a startup experience, they were at WhatsApp for four or five years. They were at, um, you know, a company that sold to Tesla or a company that stole to Apple. If they

Chamath Palihapitiya: made it through that acquisition, they know the lifespan of a company and they know that companies can get

SPEAKER_03: sold for a lot of money. They now are poised to start their own company because they got a taste. They didn't get rich. They got a taste. They got that taste of honey in their mouth. Mmm. Yum, yum. I watched the leaders of WhatsApp make billions of dollars. I made a couple of million dollars or I watched, you know, my startup gets sold to Twitter. The founders made a million dollars each. I made $25,000. I would like to add a couple of zeros to that. I would like to run the company. I watched the schmuck Jason Calacanis run a company. I could do it better. Rafat Ali from Skift. Skift. I'm an investor in his company now. He worked for me. It was like, Jason can make a media company. Like he took notes. Here's all the things Jason did right. Here's all the things Jason did wrong. Then he started Twitter companies. So one to the Guardian. Now he's on a second one. I'm an investor in the second one. Skift. S-K-I-F-T.com. Go watch it. It's a great travel site, business to business travel publication. Um, so I think finding those people and then if they have a sense of purpose and they're missionaries, not mercenaries, mercenaries want money, missionaries want to, uh, convert people to believe in the idea. You want those missionaries, not the mercenaries. The mercenaries will get the money and they'll leave. Or if they don't get the money, they'll leave. Mercenaries leave and try to find a better paying customer. They're not, you know, they're the Boba Fetts of the solar system. They're just going to take, you know, if Darth Vader pays them more money, great. If Jabba pays them more money, great. If Luke Skywalker pays them more money, they're going to just go to the highest bidder. You want those missionaries. And when you have a little bit of money, you bought your apartment, you had a success, you may get, you know, you may be in a perfect position to want to take risk of starting a

SPEAKER_04: company. So that's how I like to find them. I mean, the other thing to do is to just show up at every event possible and tell everybody you meet, I want to build a company. I'm looking for a technical co-founder and just email your network and just relentlessly network. If you can't go out there and find a technical co-founder, you've DQ'd yourself from being fundable, by the way. So I appreciate you asking the question, asking for hacks, but here's a little secret. If you can't find a technical co-founder, if you can't convince anybody out there to join you on the startup journey, you've DQ'd yourself, disqualified yourself from being a founder. You can do it. You have to work your network. You have to go out and hustle and go to events. You have to go on LinkedIn. You have to email 50 people, get seven of them to respond, get three of them to go to coffee and convince one of them to join you on this crazy journey. It is not easy. But again, you do not get to be entitled. You do not get to have a startup just because you want to. You have to earn it. And part of earning it is being able to build that early team. If you can't convince people to join the early team, how are you going to

SPEAKER_03: convince people to join you when things are hard, when you have competitors, when Google releases or Microsoft or Amazon releases a free version of the product you're charging for, how are you going to keep them working at your company? You have to be a leader. You have to be able to convince people that your idea has merit. If you can't convince people, it's either because you yourself are not inspiring or the idea sucks or people don't believe in you. All of those reasons you have to look deeply in the mirror. And this is what people don't want to do. They don't want to take that deep look in the mirror and say, Hey, what is it about me that makes people not want to work for me? What is it about this idea that people are not drawn to it? You could be crazy. You could be misguided or the rest of the world could be. It happens. Both of those things happen. I'm sure some of the people who first

SPEAKER_04: wanted to come work, you know, at Uber or Airbnb or Tesla or even Twitter just thought this idea is dumb. This idea is never going to work. But those charismatic founders convinced them to take that leap of faith. Charisma in a founder is critical. VCs don't talk about it all that often, but I talk to VCs all the time and they say, love the idea. Product looks good. Not inspired by the founder. The founder just doesn't make me believe in it. I've seen people, you know, Mark Pincus, who could sell you anything. If they got that enthusiasm and Mark Pincus is excited about it, everybody's going to be excited about it. Even if it doesn't add up, even if it's a little bit quirky, he just has that crazy enthusiasm that's infectious. It's just one of Mark's gifts.

Chamath Palihapitiya: So when he does hit a great idea like social gaming or, you know, social networking, it doesn't

SPEAKER_18: guarantee him success, but his enthusiasm does make people want to give him money and be part of the excitement. You have to be able to transfer your enthusiasm to other people. So I know you want me to

SPEAKER_04: give you little techniques on how to find a technical co-founder or just tell you like an address, go to 123 Main Street. There's 20 technical co-founders sitting there. The bigger issue is, can you convince people to come on that journey? Can you get them to join you in the Nina, the Pinto or the Santa Maria and go across the ocean when we don't know what's on the other side? And if you're going to die of scurvy halfway out there in the middle of the ocean and resort to cannibalism.

SPEAKER_03: That's the, that's the level we're talking about here. You have to be able to convince people to do crazy things like quit a big high paying job to join you without a salary. Sometimes have to convince a spouse, hey, I'm going to go do this. Sometimes they got to convince themselves. Sometimes they got to talk to their parents, all different people and constituents you have to sell into. Sometimes people forget that, you know, you're, you might be asking somebody to join you and to not take a salary. You may forget that you want them to be your partner. They already have a partner. Go meet with the spouse. I can't tell you how many times I've done that. I always invite the spouses or the significant others to come to the demo days, to come to some of the events we do, because they have to support those unsung, they're the unsung heroes. They have to support those

SPEAKER_04: founders when they're out there trying to, to make, um, trying to make it in the real world. So, um, it's not easy, but you will find that technical co-founder. I have a good feeling about it, Dan. The fact that you're asking the question means you're looking to learn and that's a good thing. Okay. Let's take one more question. All right. Here's a great question. Erica, in a short

SPEAKER_03: two to five minutes seed pitch, what do you think is the most valuable to focus on? Product, market, growth, team, prototype. All right. This depends largely on who you're talking to. If you're talking to somebody who went to Stanford business school, Harvard business school, and they're into economics, they might really care about the business model, how you're going to make money and the size of the market. What's the total addressable market here? What's your business model? Is there any business model innovation here? If you're talking to somebody who's a technologist and who comes from a high tech background, they might say, what's your IP? What unique technology have you developed and protected

SPEAKER_04: in the world? If you're talking to somebody who's got their background in sales, like Tim Armstrong at AOL was a sales guy for a long time. They might ask you, what's your go-to market strategy? Who are your customers and how do you sell them? What's your pipeline like? So identifying who the person is. If you know, it's me, you know, I'm product centric. You know, I want to hear about the product. Other people that care about the team, I actually don't care about the team all that much. I mean, I want to know about the team, but most of the teams I've seen succeed have no domain expertise. Most of them, the big successes. Now, sometimes you do have somebody who has crazy domain expertise and it works. So there's, you can't paint with a single brush. What I would say is why you're building the business and showing the product is critically important because when you show the product and if it's a good looking product and it makes sense and it's well-designed, people can understand your business. So saying it simply without buzzwords and show, don't tell. Show the product. Don't tell people about the product. So, hey Jason, I'm a huge fan. I built a product. I'd love to show it to you. You just take your phone out. Here it is. It's an email newsletter. It's designed for women. It's called the skim. And as you can see, it's written in a funny way, but it's intelligent. It's savvy. And our monetization is, we have some links here. And what's great is here's a graph of our growth. As you can see, we're adding 10,000 people every week. And we've been doing that for 20 weeks. We now have a quarter million people. It's like,

SPEAKER_03: hmm, you've shown me the growth and traction. You've shown me the product. I understand it. And you can even say why you're building it. The reason I'm building this is because journalism

SPEAKER_04: is having a really hard time reaching women. And it's a huge market. They control 70% of spending. Okay, now I got that business piece, right? So saying things simply, plain speaking, be plain speaking. None of these fancy dancy words. When you're like using tons of disintermediating, the crowdfunding market, and, you know, it's just, it's too many buzzwords. We allow people to support creators directly. Sort of like Kickstarter. And if you're making a podcast, these people can give you a monthly donation that keeps your podcast going. And they can pay you either by episode, a dollar an episode, or a dollar a month, whichever they prefer. And it's like, oh, okay. Patreon sounds like a good idea. That could work. Oh, and by the way, our top person, Tom Merritt for his daily tech news show has, you know, $15,000 in reoccurring revenue. He's got $180,000 a year in patronage. Wow. That's interesting. You got me. So that hook, right? And if you have performance, share it. And if you have great product, share it. If you have an

SPEAKER_03: idea, don't share it. Nobody cares about your idea. If you have an ugly product with no traction, it's not the time to talk to investors. Literally not the time. Coming up to me, what Chris Saka was complaining about the other day, like asking him to come have a coffee meeting to listen to your idea. He was like, can you come up with a better pitch than wasting my time over coffee with your ideas? Can you imagine if Chris Saka or Mark Cuban had to listen to everybody's idea then to decide who to invest in? Completely inefficient. Everybody's got ideas. Not everybody's got the idea, ability to build a product. Not everybody's got the ability to build a team. Not everybody's got the ability to reach customers or to hit any kind of traction or reoccurring growth. That's what investors are looking for. They're trying to eliminate people. If you come up and say, here's my idea. What do you think of it? Or can I get your money? Or can I get your, take you to lunch? Like asking a rich person to take them to lunch is just weird. It lacks tact. I did it in my career. I was like, Hey, I'd love to take you to lunch. I was just like, dude, I know you think it's a kind gesture. Most of these VCs are drinking soylent and trying to lose weight. All they do is eat big, crazy meals at expensive restaurants. They don't want to eat any more meals. They don't want to drink any more coffee. They have more money. They don't have time. So they don't have time being efficient and saying, this is my product. This is the traction. This is why it works. This is why you're the perfect investor. Are you interested in investing? Would love a quick, would love a maybe, would love a yes or a quick no, because I'm trying to find an investor who's as passionate about this as I am. Be brief and just share your product's actual performance. If you can't get product performance, congratulations. You have just EQ'd yourself from being an entrepreneur. Let me just say that again. If you cannot get performance, if you cannot finish your product, you've DQ'd yourself from being an entrepreneur and a founder who's fundable. That's fine. You could be a hobbyist, but let's, let's be candid here. If you can't finish your product, if you can't spend your own money to build a prototype, if you can't get some number of people to test your product and love it before taking money from professional VCs and angels, you're not ready. You're not good enough. You're weak. You're worthless. Nobody needs you. I hate to be the one to tell it to you, but if you are just an idea person, there is no place for you in the world. Maybe you can write screenplays. I don't know where ideas are valued. Screenplays, art, I don't know. Write some lyrics for a song. I don't know, but it's not this world. This world is based on your performance. It doesn't matter who you are. It doesn't matter where you come from. What matters is what you built and do people love it and use it. It's a performance-based industry. If you can't finish the product, if you can't get customers, hit the road, Jack, and don't you come back till you have them. Great question. All right. This has been an amazing episode. Thank you to our partners for supporting this all. Ask Jason. If you have questions, go to askjasonatlaunch.co. I shouldn't say go to email. Email askjasonatlaunch.co or just

SPEAKER_04: tweet your question to add TWI startups. We love video-based questions and make sure you follow us on the Twitter. Make sure you follow us on Instagram and we'll see you all next time. Bye-bye.