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DHH recommends a Stoicism primer to founders; Brian Armstrong points to a Hester Peirce speech
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2 min read
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145 docs
Recommendations from tech founders and investors: DHH's pick for coping with founder stress, Brian Armstrong on Hester Peirce's case against overcautious regulation, and short endorsements from Elon Musk, Marc Benioff, Jack Dorsey and Listen Labs' CEO.
Top pick: DHH on The Guide to the Good Life
David Heinemeier Hansson was asked for his "single best piece of advice" at the end of a long-form video interview. His answer was a book: The Guide to the Good Life, which he called "the introductory text to stoicism." He said many of the ideas he had covered in the interview come "straight out of stoicism," including negative visualization and separating what you can control from what you can't . The interview doesn't name the book's author.
His reason is personal. Looking back, he says "97% of" the time he spent stressing was "a complete waste," and taking Stoic principles to heart is what helped him move on. He describes them as "mental tools" that make the same situation easier to handle. In his view anyone would benefit, "but particularly the people who willfully put themselves in stressful, high stakes situations like entrepreneurs" .
Brian Armstrong: Hester Peirce's SEC speech
The Coinbase CEO posted a thread arguing that "one of the biggest killers of innovation is being blinded by hypothetical downsides." He said the thread was "inspired by" SEC Commissioner Hester Peirce's recent speech at SIFMA's digital assets conference. Armstrong uses the "de facto ban" on nuclear power as his example and lists ways regulation fails :
- "asymmetric error costs"
- "process as a veto"
- "worst-case models treated as fact"
- "rules written for the last accident"
Shorter endorsements
- Everyday Astronaut (@Erdayastronaut) on Starship reaching orbit, endorsed by Elon Musk. Musk called the post an "Accurate analysis" . The post argues that reaching orbit on Flight 14 was "completely arbitrary in terms of performance." It says the burn added only about 91 m/s of velocity, and the delay should be applauded as a choice for "SAFETY." In its view, the hard part has been the "downhill" side: deorbit, reentry and splashdown . Musk runs SpaceX, so this is praise for coverage of his own company.
- "Full teardown: How SaaStr AI actually runs inbound renewals" by Jason Lemkin, shared by Marc Benioff. Benioff gave no reason beyond calling Lemkin and SaaStr a "Legend" .
- A YouTube video tagged to DHH, recommended by Jack Dorsey. Jack called it "really excellent" and didn't say why . Neither the post nor the link shows the video's title or creator.
- Behind the Cloud by Marc Benioff, credited by Listen Labs CEO Alfred Wahlforss (@itsalfredw). He said he has "taken countless ideas from Behind the Cloud" . Treat this as courtesy rather than a neutral endorsement: he wrote it in the post announcing that Salesforce, Benioff's company, is acquiring Listen Labs .
DHH recommends a Stoicism primer to founders; Brian Armstrong points to a Hester Peirce speech
Brian Chesky
Profile
Brian Chesky praised an unnamed earlier podcast by Jason, saying its point that software development costs are about to fall “really resonates.” He argued that natural-language programming could let far more people create software and urged people to adopt AI tools rather than fight them.
David Sacks
Profile
In a discussion about learning to double down on winning companies, David Sacks credited Brian Singerman’s nearly two-hour lecture on the importance of follow-on investing .
Chamath Palihapitiya
Chamath Palihapitiya endorsed a RapidResponse47 video featuring @altcap on the SI Summit, replying “Accurate and concur” to @altcap’s description of Trump’s opening as focused on Main Street Americans and a “legendary move of statecraft.”
Marc Benioff
Listen Labs CEO @itsalfredw credited Behind the Cloud with giving him “countless ideas” and called Marc Benioff a hero, in a post announcing Listen’s move to Salesforce.
Brian Armstrong
Brian Armstrong linked Hester Peirce’s recent speech, saying it inspired his argument that focusing on hypothetical downsides and restrictive approval processes can stifle innovation; he cites nuclear power as an example.
David Heinemeier Hansson (DHH)
Profile
DHH recommends The Guide to the Good Life as an introduction to Stoicism, pointing to practices such as negative visualization and separating what is within one’s control from what is not . He says Stoic principles helped him avoid needless stress and can help entrepreneurs build mental fortitude for high-stakes situations .
Patrick OShaughnessy
Patrick O’Shaughnessy shared his video conversation with Instinct founder Noah Shinn and invited viewers to enjoy it; the full conversation is available here. It is Shinn’s first long conversation about Instinct, a personal AI assistant, and covers its growth, business model, trust, and safety. In a clip, Shinn argues that AI assistants could reduce ad revenue for companies such as Uber, DoorDash, and Amazon while increasing customer interactions by making tasks nearly frictionless.
Garry Tan
Garry Tan urged followers to follow along with Y Combinator’s live stream, The Startup Industrial Base: Building for the Next 250, from Washington, D.C., about how startups are helping build the future of defense tech in America (broadcast).
jack
Jack praised a YouTube video as “really excellent,” tagging @dhh; the post does not identify the video's creator or give a specific rationale beyond that praise. Link: https://youtu.be/vDjW_dRyKXY
Ryan Hoover
Ryan Hoover shared his own 2013 post on SMS-first startups after noting that he was seeing more SMS-first startups; he later posted a corrected link to the piece: https://www.ryanhoover.me/post/sms-first-startups.
Elon Musk
Elon Musk endorsed @Erdayastronaut’s X post as “Accurate analysis” and linked to it: https://x.com/erdayastronaut/status/2105366280085672280. The post argues that Starship’s wait until Flight 14 for orbital insertion reflected a methodical, safety-focused test approach, with controlled deorbit, reentry, and splashdown as key challenges .
Demis Hassabis
Demis Hassabis pointed readers to a blog post for more information about Gemini 4 Argon, which he announced as a new Frontier AI model; blog post.
Jason ✨👾SaaStr.Ai✨ Lemkin
Jason Lemkin promoted a new SaaStr article, “This Is a Pretty Fancy Dinner. That Probably Means I'm Overpaying.”. Its lesson: customers assess value throughout the year, not only at renewal; the article recounts a Groupon champion making the overpayment remark over dinner after EchoSign had 2,000+ reps.
Marc Benioff
Marc Benioff called Jason Lemkin/SaaStr a “Legend” and shared Lemkin’s LinkedIn article, “Full teardown: How SaaStr AI actually runs inbound renewals” (article); he gave no specific reason for recommending it beyond the praise.
Tech Genius Reveals Why The AI Revolution is Inevitable | David Heinemeier Hansson
Decoded Genius
YouTube channel
David Heinemeier Hansson (DHH)
Guest
1 of 2
highlights
0:00You're not supposed to be grinding. Grinding is for computers.
0:02You do run clod all night.
0:03It's not only do you think that's required for the founder coming up today to build an amazing company. Absolutely not.
0:10David Hanson is a tech icon who proved that overcomplicating your software stack is quite killing your company.
0:15While others waste fortunes chasing trendy tools and bloated infrastructure building for actual ROI or just following the hype.
0:20Tell me about the war you guys had with Apple.
0:23I've made my due money, so fuck you Apple.
0:26But what it did give us was 30,000 paying customers instantly.
0:30A $3 million a year business.
0:32Is that the fight where you banned politics and 30% of your staff quit?
0:36Yeah. So?
0:40And so your take is, look, AI, is that next super cycle that's already here?
0:45But we don't know what's going to happen in two years.
0:49Five years?
0:50We don't know what's going to happen in six months.
0:52I think this is what's extra fascinating about the AI supercycle.
0:55Were either in or writing or just on the cusp of that.
1:00If you had asked me six months ago if you had asked me in, actually, I did an interview in the beginning of December where we'd been working on this new product called Fizzy Kanban Tool at 37 signal, and we'd written virtually all of it by hand.
1:16And I did it in the beginning of December, which folks who had already gone fully AI built, and they were astonished that we were still writing software all in hand by hand.
1:26And I was like, I don't think the ass good enough yet, and I don't actually like the interaction mode that we had at the time, which was just coming off autocomplete, like this whole notion that AI software generation was the program was sitting at the editor, and then the AI would guess the next sentences.
1:44I didn't like that from the get go.
1:46I thought that was a terrible way of working.
1:48It was like someone constantly interrupting you.
1:50I'm trying to finish a thought here and you're constantly interrupting.
1:53I thought terrible.
1:54And then literally a week later, opus was that one for eight dropped one of the major models dropped right around there.
2:02We got harnesses, open code and pi and even Codex and Claude.
2:08They all got good enough that suddenly, well, we're not doing a lot of computing more.
2:12We're just giving you an issue.
2:14Hey, agent, can you do this?
2:16And then it goes off, spins its wheels, and suddenly I saw code there at the end of the year. That was completely different.
2:23Completely different from what I came before and suddenly was code.
2:26I wanted to keep, code.
2:27I wanted to merge into my code base, and I flipped like 180 degrees.
2:32I went from like, oh, this is new.
2:36This is different.
2:36Yes, it's AI, but it's not the AI.
2:40I knew five minutes ago, and now it feels like we've been living in this world with agents since forever, but it's really only been since December.
2:49That's barely six months.
2:51So trying to extrapolate six months forward again of how the world is going to look is I think most people should have some humility.
2:59Even if you're fully AI building, you think everything's going to happen.
3:03Most folks, even in the Act who are fully in on it, did not know that the terminal, for example, was going to be this prime driver of the agent platform, that people were going to suddenly rediscover the terminal. Like, that's such a throwback.
3:18We'd have the terminal since the dawn of computers, right?
3:21Like we thought that we all moved to GUIs, and there's also GUIs, but so much of the current agent generation activity is in the terminal.
3:28So we took this something really old.
3:30I mean, I didn't ever went away.
3:32All programs used the terminal, but we reintroduced it to a much broader audience.
3:36And suddenly I got questions from all sorts of non-technical people like, hey, how do I set up this cloth thing?
3:42I need this, this terminal, this is how I use it. Right?
3:44And this has all been happening in such a short order.
3:47So we should have incredible humility that we don't know what the end of 2016 look like, let alone what things are going to look like in two years.
3:57But does that worry you with writing code?
3:58Because what happens to developers if this continues, if it continues at the pace that it's continued or that it's been at the last six months for the next six months? Yes.
4:08I think what gives me even more humility on top of the newly I just talked about was I thought, I wouldn't like this way of developing.
4:17I thought that I didn't want to be a project manager for agents.
4:21I thought that that was sort of like being a project manager for human programmers.
4:27I don't like that that much. I like to get my fingers dirty.
4:29I like to do my own programing.
4:31I don't like to go through other people.
4:32And I thought like, oh, the mental model for agents is sort of like that.
4:36And then it happened and I realized, no, it's nothing like that at all.
4:40Because the way you interact with these agents, yes, you give them a task, but then you're ready to review their work in like seven minutes.
4:47It's not like they go off and the feedback loop is two weeks, let alone two months, which usually is with a group of human programmers.
4:56In a lot of cases, if they need to build something substantial.
4:58You're talking about weeks of work at the very least.
5:00Then in some cases, once of work, when you're dealing with agents, in many cases you're talking about minutes.
5:07Maybe if they're doing something wrong, just it's hours. Right.
5:10So the change of the feedback changes the interaction model.
5:14And suddenly I found I actually really like this.
5:16If the agents are able to write code that I appreciate and find is that of depleting.
5:23And that was a big part of my reservation in the beginning.
5:25It's like, I like beautiful code.
5:27This is why I so lovingly handcrafted it over multiple decades.
5:32And I prefer it.
5:33That motive of writing.
5:36I really wanted it to be beautiful.
5:37And then I saw the early agents make something work, but in a really ugly way, and I thought, I act no.
5:45I'm going to use it for something else.
5:46I'm going to use it for the learning I'm going to use them for, I don't know, looking up error codes.
5:51I'm using them for figuring out new APIs.
5:54But then again, you have this change in December.
5:56Suddenly the agents were writing code that with a little bit of nudging, looked like my code.
6:01And then I realized that, my gosh, if I can have this super fast loop, it's more like an extension of myself.
6:08Like I get a bionic arm, like I'm extending that arm, but suddenly I can crush 4,000 pounds instead of whatever a human hand can crush that actually feels more powerful.
6:22It feels more like I'm turning into a superhuman, rather than I'm just giving up everything to some smarter robots.
6:30Again, as you talked about in two years, maybe humans will be the dumb element of the community already on some of the books, but maybe they will be in all those loops, and maybe it will then be totally different.
6:40But right now, today, I feel like this is the most exciting time to be a programmer.
6:46You have the most capacity to do the most work, to fulfill more of what you'd like to see in the world, at a higher quality than you ever able to do when you were writing everything by hand.
7:00So in short, if a developer is not using AI, they are they they are going to lose their job.
7:05I think.
7:07I don't know a lot of programmers actually already.
7:09I mean, we went I went through that face. Right.
7:12So up until December last year I was using AI, but I was using it for as a, as a tutor, as a, as a lookup mechanism.
7:18I'm still writing the vast majority of my code by hand.
7:21And then from December 4th, that totally flipped.
7:24Now I haven't started a single new piece of code that didn't start as a prompt first.
7:29Occasionally I will find that the agent isn't going into direction I want to go and I drop in on.
7:33I read some code, but everything starts with a prompt now. So I haven't talked to a lot of people who haven't gotten sucked into that loop already.
7:41Now, not everyone loves it. That's very true.
7:44There's a class of programmer, I think, who just like the mechanics of turning requirements into working code, they didn't necessarily care too much about the requirements.
7:56They didn't care so much about what we were trying to accomplish.
7:59Like what was the outcome. They just cared about.
8:01The mechanicals of human says they want feature a I will put feature A together and then I'll hand it over to the users.
8:08I don't really care either end of it. Right.
8:11And some of those people are struggling and they're struggling because it is clear that the agents are eating more and more and more and more of that.
8:20And if you just really like writing the code by hand, some of that is disappearing.
8:25And I can totally sympathize with the sense of loss.
8:29Like, hey, I just had a job.
8:31A year ago that I love.
8:34Everything was great.
8:34I was running on this book by hand, and people were paying these lavish sums of money because I was the tight resource.
8:41All these people with all these ideas had to go through me to get to work in software.
8:47And suddenly I'm becoming, if not optional, less of the constraint resource.
8:53And maybe that doesn't feel quite comfortable.
8:55And again, I also think it's fair to have some uncertainties about what the world is going to look like in six months.
9:03What if this just continues on that bar?
9:05Is anyone going to need any programmer at all?
9:07Or can the people with ideas just ask their agents to do it, and the agents will be so good that we don't need a human interview.
9:15But for me, I.
9:18I got started with program.
9:20I learned programing not because I wanted to lovingly type out programs, but because I wanted the programs.
9:26I wanted the outcomes.
9:28And then I spent a long time, I mean, almost the whole career, just getting really good at the craft and perhaps slightly convincing myself that that was what I liked.
9:37And now I have been returned to the original premise.
9:40I just really like programs.
9:42I like to make computers do things.
9:45Agents make that so much easier.
9:47I can pursue so many more ideas concurrently, and that's a really powerful feeling.
9:54for the people that don't know, which I think most do, you built the framework that runs Shopify, GitHub, Airbnb, like the modern infrastructure of the internet.
10:03Right.
10:04And you built a company that's done tens of millions of dollars in profit over 25 years without a single dollar of investor control.
10:13I want to go like level by level for someone that's just getting started.
10:17You know, take me to the first steps, right.
10:19Why did you choose to stay bootstrap?
10:23A lot of that came from my experience at the earlier internet phase, mid 90s to early 2000.
10:31We had this incredible boom and bust cycle where investors were throwing money after every harebrained idea, maybe a little bit like what's going on right now, where anything that sounded like internet in the late 90s just got funded to ridiculous sums, regardless of whether there was an underlying premise that made sense, regardless of whether there was
10:51a sustainable business that could create profits, that could then repay those investors, and eventually that part house fell apart and we got the donkey bust, and everything kind of was like a wasteland for a while.
11:05And I think that really set a mark both on me and my business partner, Jason Free, that.
11:11It's a little bit like the stories that we hear of an older generation who lived through the depression.
11:17I still, all these decades later, they're like butter.
11:23Butter. Like, do you want some extra butter?
11:25Because they remember what it was like not to have enough butter.
11:28And you're marked for life to some extent by those early impressions you have of what was the economy like, what was society like when you were coming up, and what would the crisis and traumatic experience?
11:40So we went through that, and then by the time I got involved working with Jason, I had that very fresh in my mind.
11:47I did not want that.
11:49I saw what happened to a company that gets funded to the moon and then suddenly collapses and people have to get laid off, and it's not pleasant.
11:57It's actually a lot of human stories and a lot of heartbreak and a lot of despair.
12:03And I thought, like, do you know what?
12:04There's got to be a better way to do that.
12:06Maybe we can build a business where we grow a little slower, certainly in terms of our expenses, and we live within our means, but we still have great ambitions about the imprint we want to make in the world and the products we want to put out there.
12:22Can those things be combined, especially in software, where it's not like we need hundreds of millions of dollars to build big factories?
12:29And I mean, it's funny, we've actually returned that cycle now, and we talked a lot about AI.
12:34They're not spending hundreds of millions of dollars to spending hundreds of billions of dollars literally building factories with all these data center buildings.
12:41But when the internet got going again, it was all about software, and therefore it was all about just could you have a couple of people sit down and just write code that should not require this enormous amount of investment?
12:55So I was actually just a little offended by the business models at the time.
13:00This is the early mid 2000 where why do you need all this money?
13:04Why do you need all these people?
13:06I remember hallmark of success around those days was I got to get to 100, I got to get to 100 people.
13:13And I always thought like, what am I going to do with 100 people?
13:16Like I wrote Basecamp, the product we're still selling today, 22 years later that has generated hundreds of millions of dollars in revenue over the years by myself.
13:25On the technical side, Jason and Ryan would do the design side.
13:29I did all the technical stuff.
13:30I set it up and again, this was the computers of 20 years ago, like the technologies we had 20 years ago.
13:37Not nearly as productive as what we have today.
13:39So if I was able to do that, then why couldn't we take that further?
13:42Why did we need all this money?
13:44And then as things started taking off, it was even more true.
13:48Hey, we have more money coming in that we feel like we have to or even can productively spend going out.
13:55Like, I don't want to have a huge company.
13:57I love working with small type teams.
14:00I particularly like working on individual features, which is 1 or 2 people like.
14:06The worst thing for me is this idea that we're going to have a meeting of 12 people because we're all working together, interesting.
14:14And we just all this communication overhead, all this ping pong back and forth like, no, no, no, let me just sit down most of the time by myself in my little room where I can close the door and do the work.
14:24And then occasionally we'll meet with like 2 or 3, four people if it's really getting high. And that was the premise.
14:34And I thought, like, hey, this is panning out.
14:36Like we're running this tiny company.
14:39At the time we were like at seven people.
14:42This is a little bit later in 2000, we had four major products out there, seven people, and we were launching a new product every year, and we still had base camp that was taking off like a rocket ship.
14:52And I would just look at all these other companies, like, what are you wasting all this money on?
14:57Why do you have all these people?
14:59Not just because it's unnecessary, but also because I actually think it's harmful.
15:03You're producing a bunch of software that's overly complicated, that has way more features than way more bulk than when most people need.
15:10Most people don't want something super complicated.
15:12They want something they can just solve whatever problem they have of them.
15:16As we were doing with Base Camp, I now have too many people.
15:20I'm dropping things on the floor.
15:22Things are falling through the cracks.
15:23Email is no longer good enough, right?
15:25Anyone does private management over email, which, by the way, is everyone.
15:29Every project almost today starts over.
15:32You want that's the initial.
15:33And then they realize, oh, by the time they have to add the third or fourth person into it, it kind of falls apart. Right?
15:38So that was the premise behind Basecamp first success product that we had, and just realized that the most important thing we were selling in part, was a we got to solve the problem.
15:49Like things are no longer falling off the cracks and people can get up to speed, but then also it's got to be learned.
15:54Someone's got to be able to invite a stranger to their base camp without having to teach the 500 things, without asking them to read the manual and so forth.
16:04And I always thought like, that is very congruent with that.
16:07We have a small team that are constrained that we can't actually do everything we want because I don't trust us.
16:16I don't trust me.
16:18With a team of 100, I think I would do way too much.
16:22I would have way too many ideas that wouldn't have to get called down to just the essential ten.
16:29And I would start pursuing 50 ideas.
16:3270 ideas, in fact, to reference your own discussion about AI, I think that's going to be one of the new challenges that suddenly, if implementation is no longer your bottleneck, you can do every day you have, but if you do, is contingent.
16:49Every great design work, every great, even artist has to kill their dollars, have to kill many of what they think is their best ideas to arrive at something that's simple and pure and has a coherent vision.
17:05If you allowed even the greatest artists and the greatest designers, infinite resources, infinite teams, and infinite time, they would also turn everything to shit.
17:15I mean, one of my great examples of that is the Star Wars movies, right?
17:18The original trilogy.
17:20What?
17:20The first one came out and it was 76 or something.
17:24Still one of the greatest space odysseys of all time.
17:28They were doing things with like, no computers, right?
17:32They were all just doing cardboard elements.
17:36It's a much better movie than what they were able to produce 20 or 30 years later, with 100 times the budget, tens of thousands of times more resources where they could.
17:48Computer animation of shit. Right?
17:50There is just such a clarifying, liberating funnel by having the tricks.
17:58Like when you have these titles where you got all this stuff going into it, and then it falls on its funnels and funnels because it has to.
18:05And then defining the output is this beautiful, attractive, coherent piece of software.
18:11And that's what I wanted to build.
18:14And that I feel, is what we have built over the past 20 years by embracing those constraints, not trying to liberate them as quickly as we could, not trying to think like, well, if I have two programmers today, I could build ten times as much as if I had 20 programmers, because first of all, that's not how anything works.
18:30You do not go ten times as fast by adding ten times as many people.
18:34In many cases, you like to go half a slot because of the overhead, of communication, overhead, of just trying to deal with all this stuff.
18:42So I think we're going to phase a little bit of that again.
18:44Now that so many more people suddenly have huge teams, huge capacities at the fingertips, and feel like it can do whatever they want, and it's the worst curse they could ever have.
18:56Like, you don't want unlimited time and resources.
19:00You want constraints.
19:01guys, we've been so passionate about finding the biggest geniuses, and this is just one of the many episodes.
19:06If you want to make sure you don't miss the next one.
19:08Make sure to subscribe.
19:10All right, let's get back to the episode.
19:11for the person starting today, do you think they can do what you've done?
19:15Can they stay bootstrapped? How should they look for their idea?
19:17Should they solve one of their own problems?
19:19First, is it possible to recreate the type of success you've had in this new environment?
19:24Every major success is always a product of its circumstances at the time.
19:29So can you do exactly what we did in exactly the same way 25 years later?
19:34No. Does it mean that there are no lessons to take away?
19:37Of course not.
19:37I think there are tons of lessons to take away.
19:39And in many ways, a lot of what we did has gotten so much easier, right?
19:43I remember I had an essay once, one time called There's No Room for the idea Guy, because when implementation was scarce resource and it was very expensive, you kind of have to be an implementer to build a business.
20:00Either you had to be an incremental or you had to be rich.
20:03You had to have a lot of money because you have to pay other people to do it right.
20:06And I saw this archetype for a while that hadn't either they didn't know how to build and they didn't have any money.
20:12And I thought, like, do you know what?
20:14That's going to be tough.
20:15And in fact, not only is it going to be tough, it's going to be a little scandal because you kind of sort of have to bullshit your way into convincing some implementers to build it for free or on a promissory note. And kudos to the folks who pulled that off.
20:32But I didn't think that was a generally viable model that has changed now.
20:36I have absolutely already seen people who just had great ideas and not alone be able to, with a $20 a month club subscription build, at the very least, a prototype that can validate whether there's a business idea there.
20:52And then suddenly you have something, you have a little bit of traction, you have a little bit of momentum, you have something real.
20:57You don't just have a bunch of fleeting ideas.
21:00And that means that now this domain of entrepreneurship is open to a whole new class of people, people who aren't equal members and don't have a lot of money.
21:11That's actually a class of people who did not have the opportunity to build without kind of also being great bullshit artists.
21:21And I think there's a sort of a dark try out there if you're really good at portioning other people into working for free for you.
21:27I don't know if that's what I want to build the next generation of businesses, but you can be someone with great ideas who just don't have these two properties, and suddenly now you're able to build something.
21:37So I think it's actually opening up.
21:39But what it also means is, of course, that if we're making it much easier for someone to get started, a lot more people will get started, and that means things become a lot more competitive.
21:49It perhaps does mean that the quality of the idea matters a lot more, and finding the right angle on how to protect that idea, since you don't just get ten clones tomorrow.
22:00As we talked about before, we started finding a way to get distribution, finding a way to have the angle for attention, which is what so much of the modern marketing world is around today.
22:11It's not just build something great, they'll come like that was never true, but has never been less true.
22:19And therefore you need an angle on how do you get people to care to a greater extent than what was true 25 years ago?
22:28If 25 years ago you build something that was just a really nice piece of software, you had far more of a chance.
22:35You just get up and you discovered because it just wasn't that much software.
22:39People had more time and mental capacity to try something out.
22:45I think today that it's a lot less true.
22:47I've seen even quite pedigreed teams launch something into the market, and you see this one blip and then just crickets.
22:57And that's kind of terrifying.
22:59But it's also kind of liberating, right?
23:01Then it is getting democratized.
23:04More people have access to it, but it's harder than ever to break through.
23:07So it's a bit of like, well, a monkey pause, like, oh, I'd love that.
23:12Entrepreneurship was easier. Okay, here it is easier.
23:15Well, welcome to a competitive space.
23:18That's 100 exports than what it was 20 years ago.
23:22Pick your poison. Right.
23:23So would you say that makes distribution at this stage, at this where we're at so much more important than than it used to be.
23:31And maybe you can have a mediocre product with amazing distribution and have success, but it can't be vice versa.
23:38No, I think that's probably true.
23:40I think you actually, it's probably getting competitive enough that to really break through, you have to have both amazing distribution and right.
23:48But I do think if you're going to pick one over the other, having great distribution gives you a higher chance of having at least a moderate, successful business.
23:57You're not going to have a moderate, successful business by having shit distribution and just some okay, software, that window has closed.
24:06If I'm not mistaken, you did take a single minority investment from Jeff Bezos.
24:11We sold secondaries.
24:12So we never took money into the business because we didn't need it.
24:15By the time Jeff Bezos was interested in 37 signals, we were already making enough money and then some to pay all our expenses and all our growth ambitions and whoever we want to hire.
24:27And it was funny because at the time, we were already kind of adversarial to the whole venture capital idea, because we had just seen how poorly could have gone and did go into busting.
24:41So even though when based on launch, we had a lot of traction, we started getting a bunch of interest.
24:46I remember the count being something like 40 odd beaks reached out like, hey, do you want investment? You want this?
24:52And we basically just slammed the door and no.
24:55And then Jeff Bezos reaches out and you're like, okay, let's just see what he has to say.
25:02I mean, actually distribution, right.
25:03Like your reputation is a form of distribution.
25:06Your reputation is a form of a key conversations that people would not have had with anyone else.
25:12They'll have with you.
25:14If you have a reputation, they'll open the door for you and Jeff already at that time to get it right.
25:19Like even if anyone is also still losing a ton of money.
25:22At the time, it was clear that he had built something special, and the Jason and I, at the very least would have an interesting conversation versus and I hope I don't offend any of my more recent VC friends.
25:33Like all of these, these are just not that interesting as entrepreneurial counterparts, right?
25:39Like some of them will build great businesses and then companies.
25:41These are more interesting, the kind of people who just came up through like, well, I like to deploy capital to know what I'm not that interested in that conversation in that direction.
25:50Jeff. Okay. You build something.
25:52You took something from nothing but a shitty banner on the wall that said Amazon and turned over table.
25:59And you build something critical.
26:00Okay, we'll hear you out.
26:02And and then it turned out that Jeff was also irrational in a very irrational way.
26:08Like we were like, we don't need your money.
26:10And to make it go away.
26:12Here's a ludicrous term sheet that makes no financial sense.
26:17Like, okay, fine, if you want to give us literally just millions and millions of dollars for no control, no timeline, no guaranteed exit, fine.
26:26We'll take it.
26:26But you're not going to do that, are you?
26:28And then he's like, okay, like fuck.
26:32And I remember it.
26:33It was it was funny because like, normally you go to pieces in this pitch deck and you go through all of these metrics in case.
26:39And I was like, we're not doing any of those.
26:41We will just write one piece of paper down.
26:43Here's the three key metrics about where the business is going and where we are right now.
26:47And here's the stupid number that we're asking you to pay and slide it across the table.
26:52And he's like, basically, actually what happened first was slightly across the table, just t and we got some real feedback to the right.
27:00Okay.
27:01I mean no, like that's ridiculous.
27:04But of course I mean they Jeff just to get this thing.
27:07So when he got Ahold of it he was like no you know what? Yeah.
27:10It doesn't make any sense right now at this nascent space, at this nascent time, they don't have the revenues to validate what they're asking for.
27:19It is a little bit stupid, but I'm still going to take a bet on it.
27:22Like he saw something in in us and what we were doing.
27:25We had written Getting Real, the first book that we published at the time, and he had read that, he just saw something in just the two of us that was beyond the fundamentals of the business.
27:36And he gave us our stupid number, which, I mean, in hindsight, wasn't that stupid at all.
27:41It was just stupid for the time.
27:42It was stupid for the traction we had in the moment.
27:46And then over the next, what is it going to be about 20 years, almost 20 year anniversary?
27:52Actually, I think this year we should actually celebrate that he's gotten his money back many times over.
27:59His stake is worth a ton more than what he bought it for.
28:02It was a fantastic investment.
28:04I wish that I actually had that level of rational irrationality sometimes.
28:09Like, I don't actually think I have that.
28:11And I also think that's why I run into singles, not Amazon.
28:14Right?
28:14Jeff just has this incredible capacity to see really far out and make some bets that don't actually pencil out on the math side of things, yet still somehow succeed.
28:27So that was how it happened to Jason. And I got to take some money off the table, which meant that we were now completely immune to even quite lavish proposals from BKS about putting a ton of money into the business, because we were like, do you know what?
28:45We've already taken enough off that if this thing blows up next year.
28:50Im not going to regret anything.
28:52Versus the thing is, when you're getting started and neither Jason or I were rich, like we did not have like, a cushion to fall back on.
28:58If this thing didn't work, then we'll go back to working for someone else.
29:03It's going to be tempting if someone comes waving a check.
29:07Do you want to see me into your business?
29:09Like it feels like it's sort of your money, even though it's totally not right.
29:13Like, I suppose these days, taking money off the table I ask some of these funding worlds is something that happens all the time.
29:19At the time that was not really been on.
29:21Like you could see a large check, but it would all go into the business.
29:23And then you basically had taken on a promise to pay the back, like you were going to productively deploy that and you're going to hire a bunch of people, you're going to spend a bunch of marketing, and then hopefully it was going to work out.
29:34And if it didn't, you were left with Butkus.
29:37You were just as badly off as if you're just failed on your own.
29:41In fact, you were part of your worse off because you would have tasted real money, and then it would just like, have gone away like bubbles.
29:49So that was not the model we wanted.
29:51We wanted the model where if the money we took in was some to keep and we wanted to give up zero control, and somehow we found exactly the person who were lined with that crazy triangle of what we wanted, what he was interested in, and what the baseness was able to deliver.
30:08And it's been the most happy investor and bestie relationship I could possibly imagine.
30:16All we did with Jeff was we had some wonderful conversations with him over the years where we took problems, challenges, interesting dilemmas of the business to him about once a year, and we had a great conversation about it, and most of the time his advice was, you know what to do.
30:33He should just do it right, giving us the confidence that someone in his position would say, like, hey, whatever you're doing is actually looks good.
30:43Keep rolling.
30:44I'm like, all right, let's do that. And turned out very well.
30:46do you think are the things he saw in you guys?
30:49I think he saw some.
30:54He saw some ripples.
30:55He saw some people who were not part of the usual scene he was in.
30:59He saw a brash company out of Chicago, of all places, especially in the early 2000.
31:05Chicago had nothing in terms of a tech scene.
31:08It later got something like Groupon and others came in the late O's, but at the time there was nothing.
31:16He was like, what are these people who actually believe they know better?
31:20They're in in backwater country as far as tech goes, and they're building everything by themselves.
31:27They're not wanting to raise VC.
31:29I think there was just a curiosity there, like a long shot maybe, but also just a promise of a different shot compared to all the other shots he was looking at.
31:39And he took some of those too.
31:40It wasn't like we were the only company then he did this model with.
31:43But I actually do think after we were talking to his team, I don't know, 10 or 12 years ago that we were one of the ones that fared the best, even though we had none of the traditional shape of like, oh, this is an obvious deal to me, right?
31:57And I think that's a wise way of investing that putting your eggs on, on, on some long shots.
32:04Right.
32:05Like if you see some shape there, there's some promise here.
32:08It's like, I think this thing is going to flame out to be tackle or it's going to go somewhere.
32:12In some ways it's a very DC way of thinking, right?
32:14Like leases are very much up like, well, right.
32:18Well they look mostly at the grandeur. Right.
32:19Like it's just going to be $1 billion business.
32:21That wasn't what Jefferson before it was like.
32:23But these motherfuckers crazy enough to just continue to push in the way that they are.
32:28And let's see where that plays out.
32:31I think perhaps part of it, I mean, for him, even though for us it was a stupid valuation, it was very meaningful amount of money that we suddenly went from, hey, here's almost nothing in your bank account to here's millions.
32:41Like, that's very meaningful for him.
32:43He was cushioning change, right.
32:44So at that stage you can do it just for the laughs.
32:48How does a founder that's just getting started decide to raise versus not?
32:55What are the variables?
32:56For me, a lot of it is does the business require capital to build out things?
33:03Does it require capital to build factories or produce inventory, or any of the other traditional avenues that acquire a lot of some capital?
33:13I'm far more skeptical when it comes to, do we just need to pay a bunch of people, because then I feel a what's just been happening, as we've talked about with agents, is changing that dramatically.
33:25Certainly in terms of that early validation stage.
33:28Right.
33:29It makes a lot less sense now, in my opinion, to raise a bunch of money, to pay a bunch of salaries to see if there's something there you could get to.
33:38Is there something there lot, lot cheaper?
33:42And I mean, we already been very cheap 20 years ago, before the ratings, before all sorts of things.
33:48It is Tripoli doubly true today that you can find out whether that idea you have has legs.
33:57If your ideas in software again as you talked about the problem is something everyone else and that maybe is kind of difficult now.
34:04And maybe that's also why the investor sentiments have changed somewhat.
34:08We just went from literally the high watermark in the history of software, I think 2001.
34:15That was when the highest valuations ever granted to pure software companies had ever been achieved, and probably ever will.
34:23Right?
34:23Like, it is so fascinating to look at the graph of when BC started investing in software, especially from the internet based 90s forward.
34:30Then you read the Senate in 2021 where the valuation to truly bonkers because everyone thinks SaaS is magic, right?
34:39Like it's magic or was magic.
34:42You could take these monthly revenue streams and you just plot them out and you could think it's a machine.
34:48If I put in X amount of money into my marketing thing, I can look at my LTV and my cat.
34:56And if those ratios are right, I can extrapolate that this is just going to continue over the next ten years, 15 years, 20 years that music is stuck.
35:05No one is making 15 year projections on what kind of recurring revenue a SaaS company can get today.
35:12That makes no sense, right?
35:14Because this AI joker has been plagued, and we don't even know what the world is going to look like in six months.
35:19So suddenly, if you cannot extrapolate all the way out there, the investment thesis is a whole lot more shaky.
35:27And therefore I also think raising money now is a pure software play.
35:33I hate that word.
35:33I mean, is it in a way is probably one of the worst times to do it?
35:39Maybe as bad as it was in that first com bust, because you're going to get shitty multiples, you're going to get some very tough questions about how your business is defendable.
35:52And there was sort of always there, right?
35:55Like you would always ask like, well, couldn't someone else couldn't Microsoft this would be cut into other days.
35:59Couldn't Microsoft just turn Base Camp into a feature of whatever office and like, yeah, maybe sort of in theory, but they wouldn't because they accompany like that.
36:10Couldn't create software like we were making because Base Camp was a product of what, seven, ten, 20 people can create.
36:18Not a product of what 50,000 people can create, right?
36:21But now it's a lot easier for a lot more people to be able to take a shot at that.
36:26Whether they succeed or not, you're going to have more competition on it.
36:29So I think the pure software thing is in for a rough ride, and obviously it's not even in for a rough ride, is in a rough ride.
36:37Like everything I'm hearing from valuations being branded to existing companies and what they need to show has just gotten up so much or so.
36:45In some ways, I think that's a blessing.
36:47It means that the easy money is no longer available, and therefore you have to figure out another path.
36:53And some ways, again, this is our story.
36:56Even if we wanted to raise a bunch of VC capital back in whatever, 2005, it wasn't going to happen in Chicago.
37:04We were going to have to move to Silicon Valley.
37:07Like I didn't want to move to second ballot. So maybe some of that was the year you fall in love with your circumstances.
37:15And I think that's actually a good thing.
37:16Fall in love with the fact that, like, no, you can't just raise an SEC funding anymore on the same terms that people are doing in 21, you gotta you gotta do it yourself.
37:25Now, good news is using them.
37:29And what's your roadmap for the software company owner out there that's going through some struggles, maybe not just in terms of valuation, in terms of the competitiveness, the distribution.
37:39You know, they're in a tougher market than they were three years ago.
37:43Five years ago. What are you guys doing?
37:46I have already come to terms with all the outcomes.
37:50And I say that in a way of we've been so fortunate, especially with Base Camp, to have a software product.
38:00We launched in February of 2004, the same day or the day after Facebook launched.
38:09This is an eternity in software.
38:13We've gotten all that we could ever expect to get out of that business.
38:19So therefore everything we're getting from this day forth is all gravy.
38:23And if it ends tomorrow, I will look back on that ride with nothing but immense gratitude that a we were at the right place at the right time.
38:32We built the right team.
38:34We had an incredible run, both economically, spiritually, professionally.
38:40Craftsmanship lead to build that over 20 plus years.
38:45So if it's all going to end by the end of the year because AGI is going to eat it all, I won't have any regrets.
38:52Now, I understand that perspective is a little more difficult to have if you haven't yet gotten yours.
39:01So he.
39:03But it's also an historically evergreen perspective.
39:08This is what the Stoics were all about.
39:10What is inside of your control?
39:12That's what you should focus your energy on.
39:14What could you do?
39:15Well, I continue to do all that I can do.
39:18I show up, I build the best software.
39:20I know how I try my darndest to be interesting and to share and therefore earn some attention and attention economy.
39:30And therefore, hopefully there are some people who maybe watch this show go like check it out, watch base camp.
39:35I am here at this camp.
39:36Let me see. Oh, make this something I need them.
39:38Maybe it's not something I need, but I know someone who could need it, so I'm going to recommend it.
39:43That's what I can control.
39:45So that's what I'm going to focus on.
39:46Can I control whether API is going to hit by the end of the year?
39:50And base camp and the rest of the SaaS world is going to just get swept away in this tsunami.
39:56No, I can't, so I am going to choose not to worry about it all the time.
40:02I'm going to do a little bit of negative visualization where I imagine that's going to happen, and not even just by the end of the year, but like three months, it's over.
40:12All right, Mick, peace with that.
40:16Because what else are you going to do?
40:18What are you going to go resentful.
40:19What are you going to take a baseball bat and start smashing data centers?
40:24That's not going to work.
40:26I mean, people try many times throughout history, we have this great moniker now for diluted movement, and it's happening right now.
40:35Data centers are tremendously unpopular in a lot of places because they've become the symbol for it's going to take our jobs.
40:42It's going to take what I have right now.
40:44Well, yes.
40:46And that is individually tragic and societally absolutely necessary.
40:53Productivity gains are what leads to prosperity.
40:57Productivity gains are the same.
40:59Person is able to do much more, or we need fewer people to do the same job.
41:05Now, the hope and the trust that all sort of optimistic people and comedies take on this is that, yes, some of those going to happen.
41:17We're going to need fewer people to perhaps make software.
41:20But one of two things that's going to happen, either it's going to take a lot fewer people to make that software, and therefore the price of software is going to come down, and therefore the demand for software is going to go way up.
41:31So we're now going to have actually more people writing software, directing agents to create software, because the price is going to come so much down and therefore dimensional go up.
41:41That was the theory around ATM machines when they were introduced.
41:44Right?
41:45Like a lot of people thought bank tellers were going to be out of a job because the ATM machine is going to take them all.
41:50Know what happened was the price of opening a branch then fell tremendously.
41:54It became cheaper to open a branch.
41:55So banks opened a bunch of branches, and we had more people working in retail banking than ever.
42:00After the advent of the GM.
42:02Or you look at the industrial or the agricultural revolution, which had like 97% of the economy was dedicated to farming.
42:12Like 97% of people were out there driving a plow and a horse.
42:19And I sure think at the time when they saw the first tractor roll around, they thought, fuck, that's, that's my job there.
42:27Do we want to go back?
42:28Do you want to?
42:29I mean, some people have a romantic notion of what it's like to be a farmer, including, surprisingly, a lot of software developers who were like, well, you know what?
42:36I'm done with this shit.
42:37I'm going to be a goat herder. Okay.
42:39And then if you try and realize that a lot harder to be a farmer than you think, you're sitting inside and you push little chair and conditioned room and and hitting your little keys is actually quite the job.
42:50Now there's some stuff there.
42:53And maybe human happiness is not in just getting the most cushy job you can possibly get.
42:57But I do think there's some very romantic notions about going back that don't pan out a societal level.
43:02We don't want to go back.
43:03We actually want the prosperity that comes from productivity.
43:07And productivity inevitably means either fewer people doing the same work, or the same number of people doing more work.
43:14What about those people watching out there that are 35 years old, 45 years old, 55 years old, that they don't know how to use cloud code, they don't know how to prompt, and their job ends up going away.
43:25And they feel like, you know, they're looking at AI like, this is crap.
43:30This is taking over. This is taking over the world.
43:32It's taking my job.
43:33The rich are getting richer from AI.
43:36The poor guinea poor were more by polarized in the US than we've ever.
43:41Been in the class.
43:42And there's a lot of nightmare scenarios you could imagine in that.
43:46And I also think you could have imagined those things in the prior to that doesn't mean it can't happen, and I completely sympathize with it.
43:54I actually think a lot of the current political discontent we've seen broadly, not just in the US, but in Europe as well, has come from a very elitist, glib response to free trade that when all the happened in the US and Europe and everything got shipped to Asia, people just went like, well, you get a cheaper iPhone.
44:17And they were like, well, I mean, okay, but I don't have a job and I can't pay for a house.
44:22And again, to the kids, to college.
44:23So what good is that done? Right?
44:25Even though the economy as a whole did a lot better, there are individuals in it.
44:31We did a lot worse.
44:32Now I and some of that is just had and always has been inevitable.
44:36You can have some transitions and some people are going to be worse off and some people are going to be better off, but it is still to have a well-functioning society.
44:46You need to lift all boats, and most people in most situations have to see the things are getting better.
44:53Otherwise it's not going to be stable and you can end up in a situation where the economy is getting better in terms of the global aggregate.
45:02And too many people feel like, well, it didn't pan out that way for me.
45:07And then you don't get a stable society, right?
45:10And then suddenly even the people who have all the money in the world can't live in a nice place because the rest of the civilization literally falling apart.
45:21So I do think that's a threat.
45:22I think it's worth taking serious.
45:23But I also think you have to divorce your insides from, okay, so what are we going to do?
45:31Right?
45:31First of all, what can you do if we tomorrow in the United States said, do you know what the threat that AI is going to take a bunch of jobs, it's just too great. Let's just not do it.
45:42We're just going to stop AI tomorrow, and then Americans won't have access to AI.
45:47They will be forbidden from using new technologies.
45:50And let's see how long we make it as a cocoon.
45:53What do you think is going to happen?
45:54Is it the rest of the world is going to go like, oh, the American said we shouldn't do AI.
45:58Like China is just going to go like, yeah, yeah.
46:00All right, fair play.
46:01Let's just put it all aside.
46:02No, it never happens like that.
46:04It has never happened like that.
46:06So that is the motion to propels history forward is no single nation really just gets to say let's hit pause on progress.
46:17Progress is going to happen. Whether you like it or not.
46:19We have an obligation to create as societies at all.
46:22Try to nudge it, steer it.
46:24We don't get to put it in reverse.
46:27And that's a hard reality to accept because it feels like we could it feels like, hey, this is democracy.
46:38We just vote for people who want to ban AI or ban other forms of technologies that include progress.
46:46And by the way, this happens all the time.
46:47Like there are all these interests who line up and say, for example, Waymo shouldn't drive in New York because there's a lot of cabbies who paid a bunch of money for their medallions to drive a yellow cab.
46:59And if Waymo comes in and undercuts them with a driverless car, well, what's going to happen to them?
47:07You could sort of imagine that there were a bunch of horse drawn carriages back in, whatever, 1910 who went like, hey, this Henry Ford guy.
47:19Whoa, slow down with the mob of T, dude, like, this is going to fast.
47:24Like, this is my living.
47:25I live by taking care of these horses and the right people around in my little carriage here.
47:31And we don't need these stinking model teams.
47:33Right again.
47:35Do you want to go back?
47:36Could you go back?
47:36Is that how anything works?
47:38How is it panned for any economy in the world, for any country in the world who just said, like, I don't know about you.
47:47I don't know about progress.
47:49I don't know about technology.
47:50Have they lived prosperous, happy lives ever after? No.
47:55So some of this is coming to the acceptance that we, as powerful as we feel collectively, actually have a surprisingly limited amount of influence on world history and how it progresses and what happens with technology.
48:11It's going to happen whether we like it or not.
48:14Now, therefore, I personally choose to like it because this is going to happen regardless.
48:20I can either feel miserable every day and dread.
48:23Then AI is going to eat my company and it's going to eat this, that and the other thing. Or I can go, do you know what?
48:29I don't know what's going to happen.
48:31So I choose to believe this is going to be amazing.
48:34I choose to believe that we're going to get a new age of abundance, in the same way that every technology revolution has granted mankind as a whole, in aggregate, since time immemorial.
48:46Maybe I'll be disappointed, but if I will be, then I can save this appointment for that day.
48:50I don't need to nurture it every single day going along, because I often think it has this stall defying ability to just paralyze you.
48:59So you sit around fretting all day about what's going to happen in the future, a future you don't control.
49:05You're just going to be miserable and useless.
49:07That is not a recipe for neither happiness or prosperity.
49:11So might as well put on those rose colored glasses and make the best of it.
49:16Get involved.
49:18I mean, I had that little moment actually with AI when I thought AI, the program was clearly saw it was taking off and I saw this mode.
49:27I didn't like this auto complete mode, the early stages of AI, and I felt like, shit, maybe I should be a potato farmer.
49:34Like maybe I'm done with this shit.
49:36Like, if this is what my industry is going to turn into, I don't know if I want to be part of it.
49:40And then thankfully, I snapped out of heaven.
49:43Also, the mode of operation changed and I saw what you ages with people like, do you know what?
49:48I'm just going to lean that I am going to make the best of what I've been given because I don't have a choice that the way.
49:55So choose to be miserable, choose to be happy.
49:59This is literally within your control.
50:01Yeah.
50:01Look, I agree with you on some things, but I do want to push back, so I so I live my life with an insane level of optimism.
50:08So I'm in a similar way not going to think about, oh my God, this is going to end the world.
50:11All these jobs. I'm pushing forward with optimism.
50:14But the but the the pushback is unlike some of these other references.
50:20Right. Where. Yep.
50:21The model T came along okay.
50:23Horse and carriage is gone or self-driving is here.
50:26Taxis in New York are gone from the people that I spoke to, specifically Romanian Polski and a couple other people even here more recently, their worry isn't that AI is going to help, or AI is going to put us in a position where we're losing all our jobs.
50:42They're worried that if we don't put guardrails, you have a couple companies, 3 to 5 companies, right?
50:47You have anthropic, you have Google, right?
50:50You have OpenAI that are building something that will be powerful enough to kill all of humanity, right?
51:01Henry's model T Ford was going to displace a lot of jobs and things were going to happen.
51:06There's a technological there's an industrial revolution coming, but there wasn't a chance that was going to kill all of humanity.
51:12We're in a position today where we're still in control.
51:16We haven't reached from what we know.
51:19We haven't reached artificial superintelligence.
51:22And yes, I'm not going to sit here and live my life and just stress and worry about that all day.
51:28But but if I think that could be a possible outcome.
51:32I have children.
51:33You as well. Right?
51:34So, you know, thinking about there existence in their life and, you know, you're probably just like me.
51:41Like your family is one of the most important, the most important thing in your life.
51:45You know, I don't want to stress about it, and I don't want to worry about it.
51:49But at the same time, if I just act like it's not there and put those glasses on, I think I'm doing myself, my family, potentially the world a disservice.
51:59If you believe that you have the power to change it, if you don't have the power to change it.
52:05I don't know what the service you're doing by not fretting about it all the time.
52:09Now, the other thing I'd say is, through most of recorded history, we have had a doomsday story to tell each other, and in the early ages that was limited to just what religion was.
52:22I was like, well, there was going to be a judgment day, and it's going to come and it's going to be terrible for all people.
52:30It's going to watch this in this way.
52:31And then whenever maybe there's a blessed few that gets this ticket to a higher plane.
52:36And then in more modern days, we've had with the nuclear bomb, like when that got amended and you had decades where people lived their lives in fear that like the Soviet Union or United States just going to get into this conflict.
52:52And we had the Cuban Missile Crisis and got close.
52:57Oh, if all those people, for all that time just setting out, worrying about like, well, there's there's two crazy guys, the American president and, and the leader of the Communist Party in Soviet Union.
53:10They have the finger on the button.
53:12They just need to push them all over.
53:14I mean, that was in many ways that get more immediate threat, right?
53:18It just required one misstep from one individual, actually.
53:23And in the end of the world. Right.
53:26What we have right now with AI is we have a fear that requires a fair amount of extrapolation.
53:32I'm not saying it's not a scenario you should worry about.
53:36I'm certainly not saying that the people working on the AI shouldn't be taking it seriously, but I'm also saying it is less immediate end of the world stuff than the nuclear threat was.
53:48Then we look at more modern faces and we've had the climate movement, right, like al Gore 20 years ago, went like the polar bears are all going to be gone by the time we sit and record this.
54:00Well, they weren't I'm not saying again that there is no climate change.
54:04I'm saying perhaps there's a little more doubt now about what sources of that what's our influence on then?
54:09Can you actually change it by switching everything to to renewable sources?
54:15I think there's a lot of uncertainty there.
54:17But there's a lot of people, especially in Europe, or spend a lot of time who've let that grip their entire personality, who've let that dictate whether they should even bring children into the world.
54:27Why should you bring children into this world?
54:28Because the climate is going to end in 20 years, right?
54:32Like it's going to be an uninhabitable planet, which first of all, it's just not true.
54:38Second of all, even if it was to whatever definition of of of reality that could be, it's not a way to live like what you're going to waste the last few decades just sitting around covering in the corner.
54:51No, it's not a way to to live.
54:54So I fall back to this story. Principle.
54:58What do I have control over?
55:00Like maybe you have some control over the largest things you can vote, and there's a tiny bit of a sliver of something you don't get to stop.
55:08Whether AI technology is going to continue to be delivered anymore.
55:12Then I don't know.
55:13Some person in a French cafe in Paris got to stop the United States from or developing the nuclear weapon, right?
55:21We just don't have that much agency.
55:22And there's a great liberation in that realization.
55:26You don't get to control of the world, these locomotives of progress, they're going to turn.
55:32You don't have very many of any real examples of this kind of progress.
55:39Just halting.
55:41Now we actually in the negative content of a little bit of an indication of it, like what we did with nuclear power plants, the Western world basically went, here's this insane, amazing technology that is basically producing the most environmentally friendly form of electricity.
55:59It's all baseload.
56:00It's all coming from splitting goddamn atom.
56:03And what it produces is the size of a soda can in terms of nuclear waste per person, per lifetime of energy.
56:10It's an incredible technology to have.
56:13And we just went like and no, let's like not build more of those power plants, right?
56:19Absolutely insane hysteria led us to that conclusion of a Chernobyl.
56:27Why they killed then issued a small number of people.
56:31I mean, air pollution kills more individuals on, I don't know, weekly basis probably than what Ginobili indirect effects killed even though that garnered so much attention and really steered the conversation about nuclear.
56:45Right. So that's an example of us slowing down right now.
56:49We're kind of realizing, okay, that was a big mistake.
56:53What a wonderful land of abundance of energy.
56:56All this fretting we have right now over data centers and like how they're going to get their energy and what we're doing.
57:02None of that would have been there if we just kept the pedal on the metal and built as many nuclear power plants as, say, France did it in the 80s.
57:10They more than half of France's new or power generation capacity today, which is built in the 80s from nuclear.
57:18Right.
57:19And absolutely amazing decade of just true progress.
57:22We got we got to realize that that's what we want to be.
57:26We want to be on the side of progress.
57:27We want to, yes, have a mind to the potential dangers that they're in, but we don't get to sub in any way.
57:34And if someone's going to have this super capacity, the super technology, it should be us.
57:39And I mean that collectively as certainly as the West.
57:43And therefore I'm, I'm all in a like again, you could be all in and said realize that there are some dangers.
57:52I mean, you could take another example of just normalized.
57:55In the United States, 42,000 people die every year from cars.
58:03We could stop all of that.
58:05If you set the speed limit to five kilometers an hour for every car in America, people would die from a car.
58:11Accidents. Would you not to do that?
58:14We choose to go like, you know what, 42,000?
58:17It's worth it.
58:19It's worth being able to get the word get through all days, being able to ship goods back and forth, to be able to live a civilized life.
58:26It's worth some trade off.
58:28And I think that that's what's often missing in that discussion is like everything is a fucking trade off.
58:34And yes, we don't allow cars to drive 100 miles an hour on residential roads, even though they could get slightly faster to where they were going, because like, that doesn't seem worth it. Right?
58:45But we don't go like, well, we can't have cars, we can't have transportation because people get killed in traffic accidents.
58:52And therefore with AI, we also just can't go like, well, there's a risk here.
58:56This could go wrong. Let's put it back in the box.
58:59This is the most exciting technology that I've literally seen in my lifetime.
59:04Like the most exciting thing we've made a machine do.
59:09I am astonished on a daily basis that we've made computers do this.
59:14And I love computers.
59:16I got into the viewers because I love these damages.
59:18I love what you were able to make them do.
59:20Now I'm seeing what they're able to make themselves do and I'm just constantly marveling at it.
59:25Let's talk a bit about that.
59:26So what they can do is let's go back to that founder that's just getting started, right.
59:31Do you think, you know, I think you've talked about, you know, your workweeks while even while you're bootstrapping, I think every founder watching has been told like they need to like work all day and night work these 16 hour days.
59:45I actually had a founder on recently, and I think he was putting in just crazy 18, 20 hour day, like he's putting in crazy amount of time.
59:52Do you think that's required from the founder coming up today to build an amazing company?
59:57Absolutely not.
59:58Now I'm actually moderating Slide Down.
1:00:01I think this delusional belief that you putting in all these excess hours is actually going to affect the outcome of your endeavor, has some qualities to it.
1:00:15I think it's wrong.
1:00:16I don't actually think it works in almost all cases.
1:00:19When you look at all the science on your mental capacity, when you're under slept or just singularly focused on something, most people can't do that productively for very long, though.
1:00:32There are a handful of outliers, and I will give Elon Musk a free pass and a few others.
1:00:37But for the vast majority of mere mortals, you're not going to go further.
1:00:43You're not going to go better by doing the 120 hour bullshit.
1:00:49Now, as I said, there's something redeeming about leaving that you could, right?
1:00:53Because it actually is affecting your own agency.
1:00:56It's a faith in your own worth.
1:00:59If I put in another two hours, I'm going to get that much closer to it.
1:01:03But I also think you need to look at these things in like what actually works, right?
1:01:08Are you having better ideas? Are you being more productive?
1:01:10Especially now given the discussion?
1:01:12We've had a lot about these aged things, right?
1:01:15And we have computers who could do a lot of the grind for you when you're there to add to huge degree is whatever is beyond that, right?
1:01:28You're not supposed to be grinding.
1:01:30Grinding is for agents.
1:01:31Grinding is for human or not for for humans, grinding is for computers.
1:01:35They don't care. You can run clawed all night.
1:01:38As long as you pay the token bill, it's not going to.
1:01:40It's not going to pitch and moan.
1:01:42In fact, anthropic is going to love you even more if you run a 24 over seven, right?
1:01:47That's not how humans work.
1:01:49So I think you have to look at what actually works.
1:01:52And what works in part is to get proper sleep is to be well rested is to be informed by more than just the tunnel vision of what's in front of you.
1:02:03I find this goes, in fact, history.
1:02:08People who get great ideas on simple walks in the shower, away from the grind, right where you gain those insights that route around two months of drudgery because you should just have a better idea.
1:02:24That's what's going to make or break.
1:02:26Now, I'm not saying that there aren't phases and moments where you push a lot more.
1:02:31Of course, there's I've certainly done that.
1:02:34But what I like to look at is the moving average, the long term moving average.
1:02:39My moving average over the past 25 years has been 40 hours a week.
1:02:43And some of those weeks have been 80.
1:02:45Yes, but a handful of them, it's a little bit less.
1:02:48But the moving average is 40.
1:02:50And I think it's actually a good place to be.
1:02:53And I think you can wind yourself up thinking that unless I spend 80 hours a week, I'm guaranteed a failure.
1:03:02That's not just not how anything works at all.
1:03:04Everything has got them. Powerwall.
1:03:06The first ten hours you spend on your business every week matter infinitely more than whatever the ten hours from 80 to 90, right when we got going over base camp.
1:03:19This is the reason I use this democracies.
1:03:21I had ten hours a week because I was in school.
1:03:27I had other clients ten hours a week.
1:03:28That was what I was dedicated to, base camp.
1:03:30I've never been so productive in my life.
1:03:33It was the most productive hours I have ever witnessed from my own two hands, because there was no time to waste.
1:03:39The problem with the 80 hour delusion is you start thinking that every bit of the moment is, or movement is momentum.
1:03:50No it's not.
1:03:51You're going to waste the vast majority of those areas on bullshit, because that's just sort of that's just what we do as humans.
1:03:59The more we have available, the less value there is at the end of that tale.
1:04:04Right?
1:04:04So then I also think, okay, you're going to give this a shot.
1:04:09You want this to succeed. Of course you do.
1:04:10This is why you started it.
1:04:12But you should also have to drill into is like most of these fail and most people fail repeatedly.
1:04:20And life is not that long.
1:04:22If you grind incessantly from your 20s through your 30s through 40s and you've just done a batting average, you're going to fail.
1:04:32You're going to end on the other side, and you're not going to be living there.
1:04:36You're not going to build a new car.
1:04:38You might have some base hits.
1:04:39That's the best. Most people can go for it.
1:04:41They should, of course, ink for more, but then they should also set up for the downside.
1:04:46Okay, if I spend 80 hours a week for decades on end, or even just a decade, what's left for the rest of life, right?
1:04:56Am I going to be left with this terminal regret if I spend ten years of my life pursuing this business, pouring in everything and then some, and then it doesn't work.
1:05:06I don't get the payoff.
1:05:07There's not a pot of gold at the end of the rainbow.
1:05:11Do I have anything to fall back on, or do I just have this one leg of the stool?
1:05:15That was business.
1:05:17I think this is the great American pollution that you have to choose.
1:05:22Either you're putting it all in a business and then you sacrifice your family, your friends, your health, your hobbies, your everything else in life.
1:05:32Oh, you're not serious.
1:05:34This is one of the critiques we got right from the early days, and we were running a lifestyle business because we were not putting it all in on black woman 12 right.
1:05:43And I always thought that was such a curious accusation because I thought of it as a compliment.
1:05:48I have a lifestyle and I have a business that sounds great.
1:05:52I get to have both at the same time.
1:05:54Wonderful.
1:05:55I get to apply my intellect and my talents towards the business about 40 hours a week, and then there's time left over to be a whole human.
1:06:05That sounds like pretty sweet. Deal to me.
1:06:07Like I'm not willing to trade that much of my human time.
1:06:13And not that work isn't human.
1:06:14I think it's actually deeply human, and I think most people really need work.
1:06:18And I think this is one of the greatest challenges of the utopia that can be imagined by AI, that we get such abundance that humans just aren't needed for anything.
1:06:26And we think we're all going to be artists and painters.
1:06:29No you're not. You're just going to be depressed.
1:06:31This is what we see when people lose their jobs, right?
1:06:33And go for long term. Most people need work.
1:06:36They need to be able to employ their talents towards a goal together with other people to feel good about themselves and to feel happy.
1:06:43But, but, but you can.
1:06:45Do that 40 hours a week and get all of that meeting and satisfaction.
1:06:50In life.
1:06:50And then you can also raise a family.
1:06:53You can also have friends.
1:06:55You can also have hobbies.
1:06:57And if you manage to combine those two things.
1:07:00That's a slice of happiness right there.
1:07:02And this.
1:07:03Economy that is either one of the author is just so bunk.
1:07:07And I wish that there were more examples, I suppose, or there was more pull on that end that the examples we do have, and I'm putting my own example for of it panning out would be appealing.
1:07:24Again, I love the fact that, especially in the United States, we have single obsessed individuals like Elon, who's the productivity, for example, here, which is lives and breathes the business in the dirt business, the businesses and getting humanity and Martians.
1:07:42What wonderful. How inspiring.
1:07:46That's not something tens of millions of people have neither talents, the temperament or the good fortune to pursue.
1:07:55Most people have to come to terms with something a little more modest in their ambition.
1:08:01Build a great business that serves tens of thousands of customers, a few hundred thousand of customers, not necessarily billions.
1:08:10That turns out to be a moderate success.
1:08:12That affords you a nice lifestyle, but not, I don't know, five planes and your own personal rocket to Mars.
1:08:23I sort of aspire that, like, we can have both of these things.
1:08:27We can have the appreciation for the outlying success, the trillionaire, and applaud that as a great achievement for mankind and also go like, you know what?
1:08:37Most people. Are not going to get that they should.
1:08:39Be happy with far less, but maybe that's not possible.
1:08:43I've also come to that sort of realization that Europe, to some extent have been pursuing the like.
1:08:50What if everyone just has a moderate degree of ambition, or moderate for European standards would be very low for American standards, right?
1:08:59And if you look at the long run experiment there, it's not panning out that well.
1:09:03For me it is.
1:09:04It's not going down great. The VPN economy.
1:09:06So I could also be wrong.
1:09:09But I certainly think at a personal level I would not try.
1:09:12I would not trade.
1:09:14Having spent two plus decades building Basecamp as a lifestyle business while making hundreds of millions of dollars in revenues and getting to keep a surprisingly large chunk of that while enjoying life and having a family like, I don't want to give that up, right?
1:09:31And I don't want to have any guilt over that either.
1:09:35This is what the accusation lifestyle business is off the ground.
1:09:38Like you aren't applying yourself enough.
1:09:41Like if you were more ambitious, you could do more.
1:09:44Okay, I don't need more.
1:09:45I have more than plenty.
1:09:47Finding what your personal enough is, I think is an incredible gift as a personal insight to a rival.
1:09:56And we all have different levels.
1:09:58Like my enough was certainly not just I'm going to have a 95 and I'm going to do some good work just individually inside a company work for someone else.
1:10:06That was not enough for me.
1:10:07I went like I went around my own business.
1:10:09I want to, I like cars, I want to be able to buy some cool ones.
1:10:12I want to go racing.
1:10:13I want to have some comforts.
1:10:16That material success support me.
1:10:18Okay, I got those things.
1:10:20I didn't become a billion in the process. That's okay.
1:10:22What's your number for Fu money?
1:10:24Because, you know, I've heard I think it was Adam Robinson on LinkedIn.
1:10:27Say getting a software company, getting a SaaS company to 10 million.
1:10:31Bootstrap is like the new Fu money.
1:10:33Back in the day, it was. Let's raise a bunch of money.
1:10:35I want the unicorn with $1 billion evaluation.
1:10:37And now it's like, if I can bootstrap to ten mill and I can have good margins, that.
1:10:42You are already in the pantheon of of most wealthy, most capable humans who have ever lived on this planet in the history of the human rights.
1:10:52Right. Like we should all be so fortunate to get there.
1:10:56Yeah, it's a good question.
1:10:57And it has evolved over time.
1:10:58I used to naively think about it back in games, $1 million I like.
1:11:02I am dating myself here like $1 million is not fucking money for very many people in very many circumstances.
1:11:08But I don't know what it is.
1:11:10A lot of it is also on like what is the lifestyle you're happy with, right?
1:11:14Like if you're conception of I've made it is a private jet.
1:11:19Yeah. No ten mil can't even cut right.
1:11:21You need a little bit more than that.
1:11:22But if you can abstain for that tremendous luxury, it is to have a private plane, and, I don't know, a handful of millions is.
1:11:31Probably where. It's at.
1:11:32Like, as long as you get to live in a place where you're happy and how is your content with and have all that paid off, you could.
1:11:41Get. Away with surprisingly little.
1:11:43I mean, there's been this whole fire movement with I don't even know what the pattern stands for, but like retiring urban white people, like they set this number.
1:11:50They work really hard to get to these number.
1:11:52And then they go, like, now I don't have to do anything.
1:11:54Not I think there's actually a little bit of a dilution of that.
1:11:57As we touched on briefly, I don't think most people are happy to talk about some of the most miserable people I've ever met, of people who retired or are you and some, through the great fortune of selling their company before they had a better idea and they just thought, well, I made this one company and it went great and someone wanted to buy it.
1:12:16I'll just make another one when this one is sold.
1:12:18And they realize, oh shit, it's not that easy.
1:12:21And not only in terms of success that's hard enough to make another successful business, but to find something that you're actually passionate about the second time around.
1:12:31Difficult. Quite difficult. And I am.
1:12:34Personally, I didn't want to say I'm afraid of it.
1:12:36I'm realistic about it.
1:12:38I am very realistic about the fact that base camp is probably the best business idea I've ever had, and I will not have another one that is anywhere near as good.
1:12:47And it requires some humility because I think most founders, they have a high symptoms of self.
1:12:52That's why they put themselves forward and they think they're better than other people.
1:12:54That's just that's what it takes to build something, right?
1:12:57You got to believe that I'm better at whatever this niche is.
1:13:01I have some insight here and that's why I'm worth it to pursue it.
1:13:04But that can also tip over into that delusion thing like, well, I have infinite number of great because no you don't.
1:13:10Most people don't.
1:13:11Most people would be so lucky to have one great idea in their lifetime as it pertains to business that can take it to our success.
1:13:20So yeah, I will say though, when you find whatever that number is and when you reach it, you also got to be careful about the transformation you expect your life to have not actually occurring.
1:13:36This was one of the things I had a little bit when Jeff did the secondaries with us.
1:13:40I went from having a bank account with not a lot in it.
1:13:44Just suddenly there were millions and I thought that life is just going to be magical actually, afterwards, that somehow like everything which is going to be pink all the time, like rose colored, just it wasn't right now I also understand that lesson, or that piece of advice or even observation, is actually a piece of insight that cannot transfer to another human.
1:14:08No one believes you, literally no one.
1:14:10And I know this because I didn't believe any of the fucking shit tried to tell me before it happened to me. Right?
1:14:14And then I've seen I've tried to share this article and they're like, yeah, that's easy for you to say. You got yours.
1:14:19And it also is doesn't mean it's not true.
1:14:21It does not mean it's not true that if you look at the so people who achieve that, they achieve the goal they like, they sell the business or they get a home run or something else, and then they think that all the problems go away.
1:14:35And then it's Monday and like all the demons or whatever, that everyone, Ted, they're still there.
1:14:44And like, it's not actually bliss that doesn't need is not better.
1:14:49I might rather be unhappy and lovely than than poor and unhappy, but there is some sort of insight into if you pin all your hopes and dreams on all your mental state, issues are going to be solved.
1:15:05When you reach that number, the fuck you know.
1:15:07You're probably going to do this because almost everyone who who's ever gotten there has.
1:15:11Now, that being said, didn't you fuck you as a mental state?
1:15:17I think it's actually an incredible drive and really actually helped me make better decisions.
1:15:23Like for example, not take the Cup fantasy money, because if I take someone else's money and I owed them in that sense, I can't very well tell them to fuck off if I think their immediate full of bad ideas. But I mean, not that I would, but I actually can't tell Jeff to fuck off if I think he's an idiot with bad ideas, right? Like we don't have that kind of relationship.
1:15:43He's not bought that part of me and neither has anyone else.
1:15:49So therefore I get to show up to work and mostly just spent my time on things I find interesting.
1:15:58Worth it.
1:15:58Suing and see where the chips may land without a whole lot of of like what someone's going to say. Think about that.
1:16:05Or what's my boss going to like?
1:16:08The price of independence for the kind of people who are motivated by that is actually priceless, right?
1:16:14There's no amount of money that I would sell that for.
1:16:18And this is something we've occasionally garnered disbelief with when I say I would not trade my business for almost any other business if it required me to have someone above, and even that someone above me would just be the public markets.
1:16:33I know there are number of people who run public companies, and the constraints on their independence and ability to say what they think is quite severe.
1:16:45And it's such a curious thing.
1:16:47You actually think like, if you get to that level and you have that power to know, in some ways you're more constrained because you have more dependance.
1:16:55You have on your investors, the public market investors and regulators and many, many, many more employees.
1:17:02And you have all these obligations.
1:17:04And it actually means that you're you're less free in a lot of ways that I really cherish now you get other things in return, and you have to have a larger impact on the world, which like, totally see the motivation for that.
1:17:16But independence is something you have a hard time pricing until you lose it, and then suddenly you realize, fuck, I shouldn't solve that.
1:17:26Let me ask you.
1:17:28You talked about having passion in what you do.
1:17:32Do you think passion is required in your industry or in what you're doing for a founder when they're getting started?
1:17:39Maybe they're just passionate about money or cars or something else, and this is a vehicle to get them something else they're passionate about in their personal life.
1:17:47Is it possible to build an amazing company that you're not necessarily passionate about?
1:17:53I think so, but I also think it's harder.
1:17:55But I will also say when I got interested in computers, I was interested in the viewers because I love the video games, and now I've ended up doing collaboration software for small to medium sized businesses.
1:18:09If you were to pitch that idea to my 18 year old self, I would have gone like that sounds boring as fuck.
1:18:15No way.
1:18:16I want to make productivity software like Jesus.
1:18:21I mean, that's one step away from being an accountant in my 18 year old mental image.
1:18:27I want to make video games.
1:18:28I want to make fucking explosions and rocket launchers and all that stuff.
1:18:32Right? And then line is a way of surprising you.
1:18:35I found out that I really like creating productivity software.
1:18:39I really like just writing Ruby code, and I actually don't play that many video games anymore.
1:18:44I still play some, but not nearly as many as I did when I was 18 and I no longer have any interest in making it.
1:18:50And that is to say that sometimes, like the passion follows, the effort like you may start until endeavor and you're not all that set about something, but then you get deeper into it and you realize most domains are actually interesting if you scratch deep enough, and then if you're trying to get good at it and trying to make it something, it just becomes easier to, if not fall in love with it.
1:19:13That's a little overly romantic.
1:19:15Get excited about it.
1:19:17I do think it's difficult to sustain momentum if you don't get excited about your business at some point.
1:19:23It does not have to be on day one, but if you're going to try to make it 7 to 10 years, which is what many businesses take before they really start to hit their stride, right?
1:19:34I think it could be a bit of a slog if you don't have any interest in it.
1:19:38Now, that doesn't mean you have to love all aspects of it, right?
1:19:41And some people really do just love the aspect of like, it's working.
1:19:45Like, I don't miss any love making the thing, but I love seeing happy customers.
1:19:50I love seeing a growing business.
1:19:54I love taking care of our employees.
1:19:56Like there's got to be something in the equation that I think you get excited about, and that fire should up to me, that's beyond just I like the rewards that come out with them now.
1:20:07I mean, I'm just talking to myself here and I could totally imagine that there are I mean, should do most.
1:20:13Did most people through time love going to work, but did they do it because they wanted to provide for their family?
1:20:19Well, they probably did it because they want to provide for their family.
1:20:21That doesn't also mean that the work was meaningful to them, and it also does not mean that they might have had delusions about like, oh man, I quit.
1:20:30If I could, if I won the lottery, I quit my job in a heartbeat.
1:20:35And I'd just like, I don't know, right.
1:20:37Jet skis all day.
1:20:39And you do that for about six months and odds and I'm talking like, statistically in terms of lottery winners are that like, you're fucking hooked on drugs and partying and cooking.
1:20:52You realize that like, shit, that's actually maybe not the greatest thing.
1:20:56And in a lot of cases, you're actually bankrupt in 24 hours, right?
1:20:59So that is to say, a lot of people don't know what they want, and they don't know what gives them deep sources of meaning.
1:21:05So it's worth looking at history and wisdom, accumulated experience over time and realized, you know what turns out that work is probably important for me.
1:21:17I should not be so quick to wish it away.
1:21:20I should try and find something that align somewhat with my talents and with my interests.
1:21:25But I can develop over time too.
1:21:27I got started with programing quite late, and I wasn't all that good at it when I got going with it, but I stuck with it and I found my angle on it and then suddenly I didn't get good at it.
1:21:39And that happens a lot.
1:21:41If you spend time and talent and investment into something that you can go from, like, I don't know shit about this to something, I know a lot about this.
1:21:48And you know what?
1:21:50Things become more fun when you're competent, the better you become at something.
1:21:54Even though you did not have an intrinsic motivation for that mission at the start.
1:21:59Before funding becomes.
1:22:00I've learned a lot of things in running a business over the last 25 years that I didn't think I'd appreciate, like cost management, right?
1:22:10Like, it turns out I love it.
1:22:12I love going through expense reports.
1:22:14I love finding like I'm spending a little too much on this.
1:22:17I love the optimization game that comes from having a well-oiled business that feels proportionate to its mission.
1:22:23Not just proportionate like efficient.
1:22:25That in itself.
1:22:28You'd ask me again, as an 18 year old, would you like to optimize your expense report?
1:22:31I'd be like, you're having a fucking mind? No I don't.
1:22:34And then you do it.
1:22:35And suddenly there it is.
1:22:37Passion. Let's talk about that.
1:22:39Because if I'm not mistaken, your whole company cut off the cloud. Yes.
1:22:44And you cut, like, $3.2 million a year off of your bill.
1:22:48You saved a bunch.
1:22:49You saved millions of dollars. Yes.
1:22:52And everyone told you, I think, like, look, the cloud that's non-negotiable.
1:22:55It's the cloud.
1:22:56And so teach the decision.
1:22:58Should founders be looking at building their own infrastructure instead of running in certain cases?
1:23:03They should certainly do the math.
1:23:05They should always do the math.
1:23:06And the math is actually very simple.
1:23:08You say cloud and then sound very technical.
1:23:10It's really should you rent or should you buy if you need a thing all the time, every day, as part of the course of running your business, and you can imagine doing that for years to come.
1:23:20You should buy it.
1:23:22Of course, it's going to be more expensive to rent a car from Hertz.
1:23:26If you need a car 340 days out of the year, you should buy that thing or lease it, or do something where you have more of a stake of an ownership in it.
1:23:34Because of course, if someone else has to buy for you and then rent it to you, they want to get paid and you have to pay that right.
1:23:42But when it comes to computers, people kind of forgot that somehow.
1:23:46And part of that was convenience.
1:23:48The cloud has some real conveniences to it, but not as many as people think.
1:23:51And when I sat down and went through those damned expense reports, something stood out that suddenly, when we were spending on the cloud, was the second largest expense we had in the business, after payroll, and it was just growing at an unnatural pace that was not proportionate to the growth of the business.
1:24:12As such, that's always a good like, what's the ratio, right?
1:24:16Like if you start your business and you're spending is over time, ratios should typically go down as you see on your business, whatever you expenses are, you should reach some economies of scale.
1:24:25And that usually means I'm spending less on X now because I have a lot more customers, right?
1:24:30That wasn't happening in the cloud.
1:24:32I was looking at our spend and comparing it to what it was like when we were running more of our own infrastructure years in advance or prior and going like, what?
1:24:42Aren't the people supposed to be faster and cheaper all the time?
1:24:45Why is these prices going up and what a getting for it?
1:24:48And then it got into it, and I realize that part of it was a massive theory in the industry, where we had collectively convinced ourselves that running your own computer was somehow now an alien, foreign, difficult task, regardless of the fact that literally every business that you know of that has been built their brand on the internet since, I don't know, prior to 2015, they ran their own computers.
1:25:14They owned their own computers.
1:25:15Like, this is not ancient history.
1:25:17We're not reexamining the pyramids and going about.
1:25:20They built these things.
1:25:21No, they bought computers.
1:25:22They plucked in power, they plugged in internet, and voila, they had servers to run their software on.
1:25:29Somehow the industry, not somehow through an amazing marketing campaign, PsyOps, even the hyperscalers and Amazon in particular, convince people that running your own, owning your own computers was actually this exotic act that made no sense.
1:25:49I started running the numbers, and the numbers made no sense.
1:25:53I cannot get into add up.
1:25:55We are not getting anywhere close to the efficiency gains that were promised.
1:26:00We can't suddenly, because we're in the cloud, get away with a team that's a 10th at the side, half the side.
1:26:07We couldn't even get rid of one person on our team going to the cloud.
1:26:11And the fact that was proved by the fact that when we moved out of the cloud, we hired them.
1:26:17The team stayed exactly the same.
1:26:19The team that runs our servers as they did when we were in the cloud.
1:26:23But we we made millions of dollars.
1:26:26I actually say made, and that's what I mean.
1:26:28We say, but it needs to be made because every dollar you get to cut off the expense line actually goes to the bottom line, which is quite different from revenue.
1:26:37Right?
1:26:37You think like, well, if I can roll my business $1 million, how much do I get to keep?
1:26:41Well, you got cogs, you got these, you've got that, you've got margins.
1:26:44And maybe there's only, I don't know, 200 grand left at the end.
1:26:47That's even amazing margins. Right.
1:26:49You have turned and said Martin, you get to keep 200 grand out of the million.
1:26:52You save $1 million off your expenses.
1:26:56You get to keep 100% of that, at least if it's a clean cut and you're not just replacing it with something else.
1:27:01And that's basically what happened.
1:27:03We have a cloud budget of 3.2 million or something, that we cut down to about 800,000 on a yearly basis.
1:27:10Suddenly there were more than $2 million straight to the bottom line freed up into business.
1:27:18And I also think what's fascinating with that journey, if I recall it for us, was that it seems so obvious in hindsight that this was the right thing to do, but the motivation is missing a lot of businesses run by professional managers because they're not actually renewing or are rewarded on what flows to the bottom line.
1:27:37They're rewarded on what your multiple lists and what you're multiple is in many ways, or in many cases, is a symptom of what you're revenue and worship.
1:27:45Roughly. Who cares if you're making money?
1:27:47Well, I care because if I owned a business, I get to keep the money.
1:27:51We don't trend and I get to cure it, but the other one is in the business and even the employees.
1:27:55We have a 10% profit share plan that 13 singles.
1:27:59So everyone got to participate in that.
1:28:01And of course, Jason and I are primarily in the business, got to participate even more of that.
1:28:06And I'm like, okay, this makes sense.
1:28:08Like, I know how hard I had to run.
1:28:11I'd say the marketing side of things.
1:28:13Two if we say $1 million, how much revenue would I have to produce to sort of get the similar amount to key?
1:28:21I don't know, 5 million?
1:28:22Holy shit. That's a lot of work.
1:28:24It was way less work for us to get out of the cloud and saying, let's just say the million dollars than it was to try to attract 5 million more in business.
1:28:32Now, I don't think this is particularly the American mindset.
1:28:36Certainly in entrepreneurial circles, it's almost like it's taboo to talk about costs because it almost again means you're unambitious.
1:28:43Why do you care about costs? Growing business?
1:28:46Just find twice as many customers, then you don't even have to bother about expenses. It's going to be a trickle.
1:28:53And I actually I mean, I appreciate that actually, as a sort of entrepreneurial spirit.
1:28:57There's some real pro-growth to it.
1:28:59But I also think, like, you didn't have to get me to like, it's not either or you can have some people who are responsible for making sure your costs are kept in check and get out of goddamn cloud, if that makes a sense.
1:29:12Why do you have other people building new things and attracting new customers?
1:29:15And then you get to have both of them.
1:29:17Can we have our cake and eat two? Yes we can.
1:29:19That's so funny because so one of my first software companies, we started me and my wife from our garage, and at the time we were choosing, okay, do we have our own server, which I think it was like 500 bucks or something.
1:29:30Or do I go to the cloud?
1:29:32And this was probably when cloud was just first starting maybe 2016, 2017.
1:29:36And I think it was like $200 a month to rent it in the cloud.
1:29:39And I'm like, well, we'll just buy it.
1:29:41We'll just plug it in in the garage.
1:29:42And we did that for the first however, you know, years.
1:29:45And it was like we just didn't have the budget for it at the time.
1:29:48And it was.
1:29:49And that's how we got started.
1:29:50The only downside was I think there was a power outage one time and I was like, oh.
1:29:54Is in the cloud all the time.
1:29:55There you go. Right.
1:29:56So I love that story.
1:29:58And it's actually something I've been trying to build some tooling around bringing back the closet computer.
1:30:04When I got started with the internet, like every company had, the closet computer, the companies I was working at back in Copenhagen in the late 90s, they all have a server rack in the office, and that would serve things.
1:30:14And there's actually a real connection.
1:30:17You get to your material when it's not just the cloud, like hardware is cool.
1:30:22So, you know, blinking and ice is cool.
1:30:24It's nice to be connected to it.
1:30:26And then even nicer if it also makes economic sense, which of course it does in so many cases.
1:30:31So I think the cloud business has been really successful and actually admired what they pulled off.
1:30:37But I also think a lot of businesses have wasted a lot of money on something where they didn't get to return on it.
1:30:45you launched a company called once where instead of recurring revenue, which is what we all got into software for, you just Pay once was part of that because you see software becoming a commodity.
1:30:58And and it's a race to the bottom in terms of price.
1:31:02Or tell me about It actually wasn't it predated the agent stuff and it didn't work.
1:31:08Oh, okay. So our analysis was there is a large number of software categories that should be commodities where you don't need the best, you just need something and it shouldn't be overly expensive.
1:31:26The one we started with was a slack competitor called campfire, which is ironic because we had a SaaS chat for our call campfire years and years before slack, and now we're sort of full circle to like slack as the dominant major chat service that people use, and so people spending unbelievable sums on them.
1:31:52Not at all uncommon that a medium sized companies are spending tens of thousands of dollars a year. And I just felt like the magic is not there for that kind of spend.
1:32:05This thing is a commodity.
1:32:07It should have commodity prices.
1:32:09And some of the things we are.
1:32:11The parallels I looked at was drugs.
1:32:13So with drugs you get a patent, you develop something that's very expensive to develop a new drug.
1:32:19Of course, well over $1 billion.
1:32:20So you get a moment of exclusivity to get you to recoup that.
1:32:25And then when that's out, the generic is come in.
1:32:27Because once the compounds are known for whatever the drug is, someone else can make it and cost not thing.
1:32:33It should be thinner, it should be.
1:32:35And actually this is how we progress, right?
1:32:37If this is how things get cheaper over time that pioneers come up with the first version, they make a lot of money to reward them for the risk they took.
1:32:45And then over time, generics competition wanted that out and it comes cheaper and cheaper.
1:32:51Why is that not happening to software?
1:32:54Why do we not have more generic software?
1:32:56Why is the cost of SaaS is not going down in some of these categories that have matured and are no longer at the leading edge of new development?
1:33:08That was the thesis.
1:33:09So we put out once and said, you know what, we'll sell them.
1:33:13She said, she's slack in a box.
1:33:14Go run it on your machine and it'll just be a one time fee.
1:33:18And in many cases you'll be able to save thousands, not tens of thousands of dollars doing so.
1:33:23And it didn't work.
1:33:25The market wasn't ready for it.
1:33:27They didn't want it.
1:33:28They maybe didn't want the obligation of running their own computers anymore.
1:33:32Maybe this is part of that discussion.
1:33:33We just talked about that the cloud PsyOps has been so successful that has convinced everyone that running your own computer is the scariest thing in the world, which is complete bullshit.
1:33:42But there's also something good to it.
1:33:44There is a convenience to it, and there's a convenience to SaaS.
1:33:46That's why SaaS is now the predominant software business model and has been for decades, including for our business.
1:33:54This is how we made all our money on base camp.
1:33:56It was through SaaS.
1:33:57Does a lot of people realize that if I could just sign up for software in my browser and don't have to install in, I think that's really nice.
1:34:04But we thought like, you know what?
1:34:05It is nice, but maybe it's not so nice if you want to spend tens of thousands of dollars on a commodity piece of software, but as of yet, it is.
1:34:13And this is one of the other things, because we were on the other side of it.
1:34:17Let's take the slack example again.
1:34:18We had essentially a version of slack in 2005.
1:34:22We can't find market wasn't ready.
1:34:25They didn't want to chat.
1:34:27They wanted to talk to the phone.
1:34:29They wanted to call people into the conference room.
1:34:31And it wasn't until slacking off, first of all, the great product, but at the right time that things switched over and suddenly it became like a stable.
1:34:43And that's what a lot of businesses like.
1:34:46I mean, there's a lot of these saying it's better to be to be lucky than to be good. There's something to that.
1:34:53There's better to be at the right time, at the right moment than to be amazing.
1:34:56And I say that with all of our own success, we were at the right time with a good enough product with Basecamp, that it worked out great and basically was great example too, because we were too early to the market with campfire, the market was ready and they didn't want to buy something like that at that time.
1:35:15But we were also too early with base camp, in the sense that competitors hadn't realized that selling productivity software online was a very profitable business.
1:35:24So we got to have the entire market, even though it was relatively small to ourselves for a decade.
1:35:29I kept being amazed that we did not have more competition for Basecamp.
1:35:34Like I knew our numbers.
1:35:35And this is, by the way, one of the things I credit the American style of the LLC to have private numbers.
1:35:41For the longest time, people would underestimate our business by 1 to 2 orders of magnitude.
1:35:48They think like you're running a lifestyle business, which means you're making, I don't know what happened million in year and just breaking it.
1:35:54It just absolutely killing it. Right.
1:35:57And I was like, fuck, if this gets out of how much money can be made in the history, like, man, we're going to have a hard time, right?
1:36:05And I just kept marveling at that.
1:36:08And did some people write? All of us.
1:36:10Nothing's going to stay a secret forever.
1:36:12But our secrets stayed hidden for a shockingly long period of time.
1:36:18And and now it's a bit harder.
1:36:20And that's okay too.
1:36:22But yeah, once didn't work yet.
1:36:26I think that's always really important to say.
1:36:28It didn't work yet, because the history of business is full of these case studies where people go like, well, we tried that.
1:36:36It didn't work.
1:36:37Well, what did you try?
1:36:38Well, we could have said that. Right?
1:36:40Like slack, we tried slag. It didn't work. Well. Yeah.
1:36:43With that product in 2005, if you try it out with the same product or a slightly different problem in 2012, suddenly it works. Amazing.
1:36:50And it's a huge category, right?
1:36:52So you got to be really careful about what the lesson should take away from history, including business history, what works and what doesn't work.
1:36:59I often take people who feel like, well, I mean, I have this idea I want to build this thing, but like, there's a lot of competition.
1:37:07Like, okay, that doesn't mean you can't succeed.
1:37:10It doesn't mean that you spin on it isn't the one that's going to break through.
1:37:13Happens all the goddamn time.
1:37:16Tell me about the war you guys had with Apple over their cut.
1:37:20Yeah, that was that was a good one.
1:37:22In fact, now, in retrospect, it was one of the single best, not one of them.
1:37:30It was the single best launch campaign we've ever, ever had for new product.
1:37:36We launched hey, Come our email service back in 2020.
1:37:42And we knew that to make that service successful, we needed mobile apps.
1:37:46Of course we did.
1:37:46We had mobile apps for base camps.
1:37:48Since the app stores came out, you need to be on mobile but Tripoli.
1:37:53So if you're targeting consumers with emails, right.
1:37:56So we build these mobile apps and we submitted them as we monitor and we got them proved.
1:38:02And then like two days after ourselves, Apple came back and said like, oh, sorry, many mistake.
1:38:07You shouldn't have been approved.
1:38:08You don't get to do this unless we take 30% of your business because you need to have customers sign up through the App Store using our payment system.
1:38:18You can't just have to sign up in your website that then we don't get our cut.
1:38:22Like, I was not going to work, right.
1:38:24And they charged pressures.
1:38:25And it turned out to into this struggle and the big struggle to have an absolute worst time for Apple and the absolute best timing for us, which was like two weeks before WWT, which is Apple's great developer conference, where you have all the media attention on it in the build up to it, and you have this great little David with Goliath story that I think a lot of developers, actually millions of developers, can resonate with.
1:38:49Like anyone who tried to submit mobile app to especially the iOS app Store knows what a heroine that could be and how sort of just random.
1:39:01Like you submit something and it'll go right through, and then the next thing it's an update and won't because there's different little bureaucrat sitting and reviewing your stuff.
1:39:10And we just didn't do what everyone else did, which was to bow our heads.
1:39:15It okay, fine, we'll pay you whatever you want, because Africa's has a bit of a monopoly in that regard, or at least a duopoly shared with Google there.
1:39:23So we had a huge fight.
1:39:25It went on for several weeks, and in the end we got the best thing that we ever, ever gotten, which was sort of a truce.
1:39:31We didn't pay half of 30%.
1:39:33They got some bullshit concessions to save face with some demo sign up nonsense.
1:39:39But what it did give us was essentially a $20 million launch date.
1:39:43We could not have bought that amount of publicity, that amount of focus, and we signed up over 30,000 paying customers to come in less than two weeks.
1:39:56I mean, these are customers, painters, 100 bucks a year.
1:40:00Like it was instantly a $3 million a year business.
1:40:05I never had a launch like that.
1:40:06It took years and years to get to that level.
1:40:10It was just an incredible high stakes encounter where the other outcome, they kill a business.
1:40:19If we just stood firm and everyone said, well, fine, then you don't get to be in the App Store and keep you out.
1:40:24We would have been dead right?
1:40:26Like 80% of that business was people who had an Apple product because people have products with them.
1:40:33Attendees pay more for software and 80% of them were buying.
1:40:37Hey, so if we had not had an iPhone app, we would have been dead.
1:40:41But in that case, we just said, you know what?
1:40:47Come with me.
1:40:49We're not going to benefit any of them.
1:40:50We are going to stick to our principles.
1:40:53This is bullshit.
1:40:54You do not get to take 30% or force us to route all our customer signups through your little tollbooth here, when we're bringing our own customers.
1:41:05We're not asking Apple for free publicity.
1:41:07I'm not asking you to features on the App Store.
1:41:09None of that stuff. We would sign up our own customers.
1:41:11We'll get our own attention.
1:41:12We'll send them up in the app on our website, and then we'll just say we have an accompanying app you can download and log in with your credentials, which has been kosher for Basecamp since we were beginning for tons of other apps.
1:41:24And Apple themselves in a pretzel trying to explain why it wasn't kosher in this case.
1:41:31And of course, it could be because the whole case has just so many distances.
1:41:35So we ended up with this fortune, this outcome.
1:41:38We've got this incredible launch campaign.
1:41:40We've got 30,000 paying customers that we would not have gotten otherwise, at least in that amount of time. And we got out of the dragon's mouth alive without them.
1:41:50And it was a public fight. On what? Twitter.
1:41:53Mostly on Twitter.
1:41:54Yeah.
1:41:55I mean, Twitter has actually been the focal point for all the great balance I've had in my career, almost.
1:42:03We've had other things.
1:42:04We've had the great woke nonsense blow up.
1:42:08We had actually, just a year later, there was a huge fight.
1:42:12It was all driven on Twitter.
1:42:14Every great fight since 2008 has been Twitter.
1:42:18Is that the is that the fight where you banned politics and 30% of your staff quit?
1:42:24What actually happened there? Yeah.
1:42:26So, we got boiled like a frog over 70 short number of years, I'd say, were the mood among certain parts of the company or subset, really a minority of employees just thought that, like, politics should have a much, much bigger role at work, whether or not even whether, despite the fact that these politics had nothing to do with our business, we sell parking management software and now need another system, like
1:42:56there are some politics related to that privacy, for example, or App Store policy.
1:43:02It's like, all right, fine, let's engage in that.
1:43:04Like, do we have any stake in, I don't know, gracefully in the United States or Foreign Wars or whatever?
1:43:12Absolutely not.
1:43:13But we got sucked into the same force to NATO that was swallowing up companies much larger than ours into nonsensical proclamations and statements and flags and growling tweets and all these other bullshit that just dominated the tech industry, doing those awful woke years.
1:43:36And Jason and I, at the peak of it, perhaps we picked out the time and poorly said.
1:43:42Do you know what?
1:43:42This is insufferable.
1:43:44I actually don't want to work at my own company.
1:43:46If this is going to continue like it is, I don't want to constantly be engaging in these fraught discussions about politics where we're trying to do work right, like we're trying to ship new features and bug fixes.
1:43:59To pester like that is not the same space where we then also discuss societal politics.
1:44:04Now, as crazy as that sounds in 2026, that was a very controversial statement in 2021, not least within a minority of employees.
1:44:14And then broadly with Twitter.
1:44:16This was before Elon liberated Twitter.
1:44:19I will use that word specifically.
1:44:22This was when it was just a woke Gemini governing that platform, and we had the most intensive scrutiny of the company has ever had over anything over a two week period where a lot of employees just cracked on it.
1:44:43There was a hardcore small subset of just ideologically committed to all this nonsense, and like they were always going to be a problem.
1:44:51But then there was a much larger group of people who simply couldn't or wouldn't take the pressure that came with the public scrutiny that that little minority was able to spark.
1:45:01And just and I still went like, you know what?
1:45:04Fuck it.
1:45:06We're going to pull the bandage off here.
1:45:08We're not going to continue down the path as we are, even if that's going to be highly unpopular.
1:45:12Much the same reasoning, actually, as with The Hague Apple, which is like, you know what? This is worth the gamble.
1:45:21Because if we don't take the gamble, if we don't take a stand.
1:45:25I don't want to work at the company that comes out on the other side.
1:45:28This was true in both instances.
1:45:30I do not want to run a company that's growling before a monopolist behemoth to be able to be in an app store.
1:45:36So we get paid for the third person?
1:45:37No fucking way.
1:45:38I'd rather farm those potatoes.
1:45:40Then, at least in my little head, I probably wouldn't want funding actual potatoes, but it's a useful metaphor to half truths.
1:45:46South of Ufa.
1:45:46I could do something else.
1:45:48I am not stuck here.
1:45:50Oh, and by the way, I've made my fucking money.
1:45:53So fuck you apple fuck you woke insanity.
1:45:58We're not going to stand for any of it. And if we perish in the fight, it shall be with a smile.
1:46:06And we think we didn't.
1:46:08And now we get back upon both of those instances, like within actually a relatively short period of time.
1:46:13I think it happened within like a year of each other, as two of the most proud moments I have in my 30 year career.
1:46:22When I think back in my little rocking chair when I'm 80 and I like, what am I most proud of?
1:46:27I will remember 2020, in the fight with Apple, and I remember 2021 and the fight with the Wilkins attitude.
1:46:36Let's talk about racing.
1:46:37So you're a car guy? Yeah.
1:46:39Yes. What are what are you what is what is your thing?
1:46:42Porsche. McLaren, what are you what are you into?
1:46:44All of it. Okay.
1:46:46Streetcars.
1:46:47I love all of it.
1:46:48My first taste of that good life in cars was actually, I think literally the week after the wire from Jeff had hit my account, I bought a yellow Lamborghini Gallardo.
1:47:03Okay. Yeah.
1:47:05It's sort of. It's always it's such a shame.
1:47:08But it's also, I think, a cashier for a great reason.
1:47:11Like there's almost nothing more satisfying as a celebration, at least as a guy who's into cars to just be able to buy something.
1:47:20A rage is like a yellow fucking Lamborghini right now.
1:47:24At this point, it's almost like a stereotype of tips on the fact that being a little much like Lamborghini has been associated with crypto quite a lot.
1:47:32But I'm like, fuck it, no, straight Lamborghini is exactly that kind of fuck you bring, right?
1:47:37Like the origin store of that company was fruit your Lamborghini going to Ferrari and say like, hey, could you improve your clutch a little?
1:47:44And Ferrari saying, fuck you?
1:47:45And Farouk was saying, no, fuck you.
1:47:48I would make my own goddamn company.
1:47:50I may make tractors today, but I will make the mirror.
1:47:52I'll make the cookies.
1:47:53I'll make the coolest goddamn supercars that will adorn bedroom posters in years to come.
1:48:01And he did that. So I love all of that.
1:48:03And I love buying that yellow line again as soon as the money was there to do it.
1:48:07But I was actually quite late to cars.
1:48:09I didn't get my driver's license until I was 25.
1:48:12I grew up in Copenhagen, Denmark, and had neither the money nor the inclination to drive a whatever old beat up to yoga, which was what was filled the street at that time.
1:48:21I didn't care anything for cars of that pedestrian.
1:48:24I cared for supercars, loved those.
1:48:27And when I had that opportunity to to to buy my own, I got, I got on to and then I of course, I got sucked into it.
1:48:35A few years later, I went to a racetrack about an hour away from Chicago.
1:48:40A friend of mine dragged me down a friend, by the way I met through these cars.
1:48:44I mean, this is the other thing, these these cars, like so many other hobbies of that kind, whether it's watches or it's it's video games.
1:48:51There's just a community.
1:48:52You get to know people who are into the same thing as you.
1:48:55And I got to know some people who were also into super cars, and one of them took me down to Joliet, and then I got to sit in a race car, and I got to driver of this car, and I just went like, Holy smokes, this is what I'm going to do.
1:49:08This is what I want my hobby to be.
1:49:10I want to see how far can I push this.
1:49:13And I spent a few years training.
1:49:15I'm getting good at it.
1:49:16And then I got into competitive racing in like 2009 or something, the first thing, and then really 2010.
1:49:23And in 2012, I was on the grid up to 24 hours old mom, which was always over my goal.
1:49:28And in two years after that, I won.
1:49:30So I just really steered all my efforts and kind of single.
1:49:35And he got a bit obsessed on the hobby side, like for quite a number of years, like that was it that was doing the business.
1:49:43I had some friends I've spending time with and everything racing, and that was kind of the the extent of it.
1:49:47But I just, I love cars, like there is just such a unique blend of thrill, danger, art history, engineering, design.
1:50:01There was just so much to it.
1:50:03And I find that especially Italian cars was the thing for me.
1:50:08Like, you're like, he needs your Ferraris and then later your Pagani and that kind of stuff.
1:50:13The Italians just they have that right.
1:50:16Like they had that gut instinct of like, it's not just the sum of its parts.
1:50:20Like I also like German cars, but they're very different and they're very much sort of like methodical engineering, like maybe the engine is in the wrong place.
1:50:27And then I got to make it work and the Italians a little bit more flair.
1:50:32I was certainly attracted to that Italian thing and that look for buoyant something to the colors even.
1:50:37Right?
1:50:37I mean, this is even more illusionary today.
1:50:40We have this great grain of the world, like the most common colors.
1:50:44I think like 80% of the cars on the road in the U.S.
1:50:47today are white.
1:50:48Gray are black with travesty.
1:50:51Where's the fucking red?
1:50:53Where's the green? Where the yellow?
1:50:54And there are actually a few red cars, but there's almost no yellow cause you count on your daily commute.
1:51:02The number of these yellow cards you see, you see almost none.
1:51:04So of course, my first one has to be yellow.
1:51:06Right?
1:51:07And I think that that is a great motivating factor to, like you talked earlier about starting a business for another purpose.
1:51:15And just like you like the business like those kinds of rewards are great carrots and great drivers.
1:51:20And it legitimately was one of the contributing factors of I don't just want this to work, I want to be it to be a success because I'd like to buy a yellow Lamborghini.
1:51:32It's a great fucking reason to I don't want to say grind like that's the word that actually like the token predicting your head goes like, oh, you should work with how you should grind. Just to give you an idea.
1:51:42I don't think that's actually how it goes. But you should.
1:51:45You should work hard.
1:51:46You should work well. You should work dedicated.
1:51:48You should try to become really good, try to become very competent, and then you try to be a success.
1:51:53And then some of the spoils can be a yellow Lamborghini or a red Ferrari or a gray Porsche or whatever is your flavor.
1:52:00But it is a great parent, and I make absolutely no bones or reservations or policies for it, which is something that sort of sometimes I've gotten a little bit of like, well, you post your cars or whatever.
1:52:11I don't post them that much.
1:52:12But for a while I was on Instagram and I'm like, I posted a lot of it and I would get some of that, like these, like it's too much, right?
1:52:20Normally from European and then go like, well, this is one of the reasons I'm in America did because here you can actually you can flaunt it in a way that can feel positive, where it's not just like bragging, even though it also is that right.
1:52:34But there's also some element of that. But it's more than that.
1:52:37It's a collective celebration that I think the American entrepreneur scene does better than any of them is like, I'm really happy for you.
1:52:45Oh my God, you did so well that you would buy Yellow Line bikini.
1:52:50Bravo!
1:52:50Good for you.
1:52:51Versus the stereotype and reality of European entrepreneurs and broader society.
1:52:56Is not that right?
1:52:58You're like, well, that's just a show off or whatever.
1:53:01Like, fuck that.
1:53:02This is one of the best things about America.
1:53:04Just this celebration of success and it's fruits is a legitimate thing to do, and you get to share it broadly.
1:53:12And it's wonderful.
1:53:13And for me, cars is probably the number one thing.
1:53:16For that. Okay, so you're a Ferrari and a Lamborghini guy.
1:53:19And let's talk about that for one second, which is.
1:53:21My favorite car in the world is actually a okay, okay.
1:53:23So I got to commission a Pagani Sonda, which is my favorite car of all time.
1:53:28Beautiful back in 2010.
1:53:30Those are crazy story on a sidekick mission and blah blah, blah.
1:53:35But I mean, I love all of it.
1:53:36But for me, the one car that was always for me after I watched it on Top Gear, actually, before I even had my driver's license.
1:53:43I think Top Gear didn't necessarily the Sonda F back in 2004.
1:53:47I want to say I watched that on this window.
1:53:50Oh my god, if I ever make it all the way, this is the car I want more than anything.
1:53:54What do you think of where they're going, though?
1:53:55You look at Ferrari with the Sf90, the Lamborghini with the revolt, and then even Ferrari with their new release.
1:54:00That looks like an Apple product. What do you think?
1:54:03What do you what do you think?
1:54:04You know, what are your what is your take on that when they're going with the hybrid now all electric, do you think it takes a soul out of the vehicle?
1:54:09So the funny thing is I just got a model Y, a new model Y.
1:54:12I've had Teslas for a long time, but the model Y managed to blow my mind because it's a family car.
1:54:18It seats seven three.
1:54:20We got it was because it's practical and seven and it drives itself no more.
1:54:24It's so fucking fun to drive.
1:54:26I'm like, I didn't even buy it for that.
1:54:28But electric cars are fun candy.
1:54:32They're not all fun.
1:54:33Like, I had a model X before that.
1:54:35It did a lot of things and had cool doors.
1:54:37Fun to drive, if not one of the attitudes ever to play to it, right?
1:54:40But there's something about electric that I don't think it's inherently bad, like the instant torque is amazing, but I also do think it is a graying of the car, in the sense that the driving characteristics of electric cars have a tendency to be very uniform in a way where there's just more variety with gasoline powered cars like, oh, there's a ten and sound this way and feels this way versus a B 12 versus a B flat, six versus a turbo versus all these things.
1:55:10Right.
1:55:10So I also have all of those cars and I love him and I love both of them.
1:55:13But I do think we're we're at a fork where electric cars are not only so good at all the daily stuff, there's a really fucking fast.
1:55:22Like the fastest cars in the world are electric cars.
1:55:25So that's taking a little bit of the top trumps out of the sort of supercars.
1:55:31So why did the supercars have left?
1:55:33Well, they have the feeling, I think Supercars is going to turn into the panicle watches and they are half mechanical watches.
1:55:40I mean, you're wearing one now. I'm wearing one.
1:55:42They're not actually great at keeping time like a $19 Casio F 91.
1:55:49I think it is that famous watch time.
1:55:52Much better than even the best Rolex that you can buy.
1:55:56Yet most people would still like a roll or a lot of people anyone cares about.
1:55:59Watches still certainly at the very least appreciates a Rolex for what it is.
1:56:03It's this intricate piece of engineering that takes 300 parts, even though it's worse on something, right?
1:56:12That's where the cars are all going.
1:56:14And you're seeing that now with the rest of mod scene.
1:56:17I had singer for a while. It was great project.
1:56:20When we take these older raw cars and we bring them a little bit up today, but still keep some of the old llamas, and then we accept that like a model Wiseman out of accelerated, it's going to have to drive it.
1:56:31It just is.
1:56:32And it's a better view of the car.
1:56:34Right. So I think we're some of these cars built in particular some of the middle stuff where the supercars are still trying to chase the absolute acceleration numbers, for example, like that game is kind of lost, right?
1:56:50Like you're not going to beat the planet.
1:56:52Model S is just going to accelerate faster than it for a mile.
1:56:55Then virtually anything that you can produce, right.
1:56:58So you got to give that up.
1:56:59And then you've got to focus on what do people want to step.
1:57:03They actually want the opposite, right.
1:57:05Like the model Y is amazing.
1:57:06And part because it's so quiet and relaxing and fucking drives itself amazing.
1:57:12And then when I don't want that, I want it's I want it raw, I wanted loud, I want it uncomfortable.
1:57:18I wanted all of those instance into it.
1:57:22Right.
1:57:22So I think a little bit of that is happening.
1:57:23I think there's a fair amount of mainstream cars.
1:57:27I also love that like that are a little bit trapping now.
1:57:29Right?
1:57:30We're both trying to be easy daily drivable.
1:57:33And then we're also trying to be fun.
1:57:36Right? Right.
1:57:37And we're getting a little bit squeezed.
1:57:38I think some of the modern stuff is having that problem.
1:57:41And you can see them wait.
1:57:42In particular, many modern supercars weighs more than a minibus would have made it way a decade ago, right.
1:57:49They're just getting really heavy because they're trying to compete with electric by adding electric motors to their combustion engines, and that's a hard game to play.
1:57:57I think this bifurcation is going to happen, and it's one of the reasons why the majority of cars that I have that are not so driver stuff is actually older stuff.
1:58:05Manual cars, manual transmission, like man made a huge comeback for a while.
1:58:11The manufacturing commission is about to die.
1:58:13Then Porsche actually should be credited with releasing this one special version of what is called the one of the 911 special, the had manual.
1:58:23It was like going to be the last record, and demand was just over the top.
1:58:27Like suddenly, after a decade plus of having automatic gearbox as a paddle shifters, everyone wanted the manual because they want to be part of the loop.
1:58:35Yes, it was slower, it was not going to be as efficient, but it required a human in the loop.
1:58:40And we want to be we want to feel needed.
1:58:42I think this is actually something you feel with the mechanical watch as well.
1:58:45You got to wind it, right.
1:58:47It doesn't just have a battery that goes for ten years.
1:58:50It needs you.
1:58:51And as so many parts of our existence kind of seems like it doesn't need us anymore, right?
1:58:57We've talked a lot about agents.
1:58:59Maybe they don't need us that much anymore.
1:59:00We got to find our worth somewhere else.
1:59:03And some of that would be like, well, at least my mechanical watch still leads my winding. At least my performance car still needs my leg plugging in and changing it here, so it's fun to see those two things.
1:59:16But, yeah, I, I love cars and I, I hope we can continue to enjoy them and they don't end up all being sort of commoditized in the way that EVs a little bit is doing, where they all just insist in the same, but they all feel the same.
1:59:35There's such great variety in the combustion engine.
1:59:37All right, David, last one.
1:59:38So the founder listening right now right there a founder of they're just looking to start a company. Right.
1:59:44They haven't started yet.
1:59:46Hundreds of millions of dollars in revenue.
1:59:48Single best piece of advice you have to give everyone just one last piece of advice.
1:59:52What is If you haven't already read The Guide to the Good Life, it's the introductory text to stoicism.
2:00:00A lot of the ways of viewing the world that I've talked about in this interview are straight out of stoicism, from negative visualization to splitting the things that are within your control and outside your control, leveling up your mental fortitude.
2:00:14Just that you're better able to deal with the waves that come your way is a thing, an incredible investment, and it's only going to get more relevant.
2:00:24You're only going to have more stresses to deal with and to better you quit yourself to cope with that.
2:00:30The higher you can go, the further you can go and the more fun you can have along the way.
2:00:34I look back upon all the times where I really stressed about this, that idea of the thing, and 97% of it was a complete waste, right?
2:00:46Just needless torching of myself for this.
2:00:50And I am not a person who's otherwise anxiously temperamental, and I still did a bunch of that.
2:00:56And what really helped me move on from a lot of it was to internalize some of these stoic principles and practices more than anything, right?
2:01:04Like they're actually sort of tools, mental tools that you apply to your view of the world, and you can just make the same situation a lot easier to deal with.
2:01:15And I think, who wouldn't benefit from that?
2:01:19Everyone, but particularly the people who willfully put themselves in stressful, high stakes situations like entrepreneurs.
2:01:27David, thank you so much for coming on, Dakota Genius.
2:01:29Thank you.
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David Heinemeier Hansson (DHH)
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DHH recommends The Guide to the Good Life as an introduction to Stoicism, pointing to practices such as negative visualization and separating what is within one’s control from what is not . He says Stoic principles helped him avoid needless stress and can help entrepreneurs build mental fortitude for high-stakes situations .