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Don't Wait for Genius: Rob Walling on Repeatable Innovation · The Innovation Philosophie Podcast

• Nathan: Hello and welcome to the Innovation Philosophie Podcast, the show where we look at the economics of innovation and the conditions that produce genuinely new ideas. I'm your host Nathan Reardon, and today we're asking whether innovation is something you can repeat rather than something you wait for. We like to believe new ideas arrive as flashes of genius. Well, my guest thinks frameworks get you most of the way, and creativity does the rest. Rob Walling is a serial entrepreneur who has started six companies, five of them bootstrapped. He runs MicroConf, the original community for bootstrapped SaaS founders, and TinySeed, an accelerator for B2B SaaS, and he has invested in more than 240 startups. He also hosts the podcast Startups for the Rest of Us, and his sixth book, Idea to Traction: Stop Building SaaS Nobody Wants in the Age of AI, is out on November 10th. Rob. Thank you for joining me today. Rob: It's my pleasure. Nathan: So let's start off very simply. Can innovation be put into a framework? Rob: Mostly. Yes. And I think Nathan: Mostly. Rob: we have we have great evidence. I I'm a avid reader of nonfiction books. I have I'm an audio person. So I have 957 books in my Audible account. And at least two of them, maybe three of them, are about Pixar. There's like the Pixar Way and Creativity Nathan: really? Rob: Inc. and like these are all great. And if anything, you when you ask the question, how does a single film studio how did they put out so many number one films? It's because it doesn't rely on one person. John Lasseter's amazing, but that's not how they did it, right? It's it's it's top down, but it's also these the frameworks and all the kind of rules they have in place that encourage creativity, that encourage creative discussion. And I've found the same with startups. Like there's a ton of creativity in building a SaaS company, but it when it's just a big amorphous cloud of like, what should I build? How should we build it? How should we market it? How should we grow the business? All that stuff, it can be really hard. But if a framework can be most of the scaffolding, get you eighty percent of the way there, and then you add some creative intuition, some judgment, some you know, just creativity from the founder, I think I think that's how great things are built. Nathan: So that extra ten, twenty percent, where exactly does that come in? Does that come in do you have to have the idea first and then you can use the framework to get you the rest of the way? Or do you have to have things built up and then someone else can come along and help you draw that creativity out of you. Rob: I think that there are certain stages of a startup specifically or of any process that require more creativity than framework. So the earlier you are in a process, usually it's like a blank canvas. In in startups, it's like, what's the idea? Who what problem are you solving? Who is it for? That is when it's probably weighted much more heavily towards just You're just clawing and scratching and coming up with a bunch of ideas and your brainstorming, it's a lot of creativity. But there are frameworks that then help you evaluate those, right? So I have in in the new book you mentioned, I have something called the 2/20/200 framework. So the two is for spending two hours on any individual idea you have just doing basic research, going on the internet, looking at Reddit threads, looking in private forums, even going to keyword tools and being like, is there any demand for this thing that I have in mind? So the two is two hours. 20 hours is if you're like, you know what? I think there's enough demand that I want to dip my toe in and do some validation. The 20 hours is starting to actual talk to humans, not just have your agent talk to other agents, but you as a human talk Nathan: Yeah. Rob: to other humans, and feasibly putting up a landing page and driving traffic and kind of just you're kind of getting the idea out in public without having a product yet, right? So that's the 20. And then the 200 is building an MVP, getting something in people's hands. And whether the numbers are exact, is it is it exactly two hours, two hundred, i that's beside the point, right? It's this directionally, it's like each step is 10x more expensive in terms of time, but each one gives you a little more certainty. So that's the type of framework that if you had 10 startup ideas right now, we could sit down and do the two hour validation for all 10 of them. And just having that framework in mind is like, well, that makes it a lot easier. It doesn't give you the answer. It's not like you plug a number in and it's a, it's an equation, but it can at least Help maybe reduce some risk, increase some certainty, but the core brainstorming and the early creativity stuff, that does have to come from you. Nathan: Yeah. Okay, great. So that's like Yeah, if if you can you can do that, you've you've not spent so much time tweaking, fiddling about, and then you eventually go to try and sell it months down the line potentially, and then people are just Rob: That's right. Right. Nathan: like, Well, this is this is solving a problem that n either no one has or has been solved better somewhere else and you've Yeah. Rob: Right. That's what we used to do. This was the big Nathan: Potentially wasted that time. Rob: mistake. w each of these, any framework that whether we ta any framework that I have come up with is trying to fix the most common mistakes that we all make, that I made back in the early, you know, in the early days of starting my startups, which is about twenty twenty years ago, twenty-three years ago, I started launching my first. The biggest mistakes is I built a bunch of stuff. I was a developer. Built a bunch of stuff no one cared about. So I was a solution in search of a problem. That's what most of my things were, you know. And just the simple 2200, it doesn't guarantee. It's not you'll never get to 100% validation. But can you get to 50% certainty? I used to be at zero. And then in my head, I'm like, I'm at, I'm at 80, because it was all in my head. But can you build up a bit more certainty over time? But another framework, if I can throw one out, is does Nathan: Course. Rob: help you in that early stage, the earliest stages of coming up with ideas. much like Pixar has. literally has frameworks around creativity. I have one that I haven't I haven't really named it anything, but it's just eight different approaches for coming up with startup ideas. And what I did is I went through all my 240, well almost all of it, 241 investments, and I either asked them or I knew from their story how they came up with the idea. And I came up with maybe six approaches that they had used. I'll talk through a couple of them in a second. We'll go through all of them. Then we surveyed the broad my broader audience of thousands of founders. And I think we got like seven or eight hundred founders to respond. And we said, How'd you come up with your idea? Here's the list and here's other. And so then we got a bunch of others. And I have this total corpus now of eight different approaches for coming up with startup ideas. Now, are will any of them 100% guarantee get you the best startup? No, but it's a frame rule. You know what you had before I started telling you about this two minutes ago? You had no idea. Nathan: Yeah. Rob: And you're like, it just hits you in a college dorm, right? That's how that's the the media myth, right? But just to give you an example of a couple of them, Nathan: Yeah, please. Rob: one one is translate an existing idea into a new niche. Okay, so one example of this is Bidsketch, which is prop started as proposal software made for designers. All right, there was already some proposal software around when this launched, but specifically the founder Ruben Gamez, he niched it down to designers. So he made it gorgeous, easy to use. It had some features in there that were specifically for designers. So it's just like niching a horizontal product down. And he had a lot of success with it. another example is To look at what you pay for at your day job. So you look at all the SaaS. In this case, I'm talking about SaaS, I we can talk about broader stuff, but look at what your company pays for day to day. And there's been several, like SavvyCal, which is a competitor to Calendly, came out of that. The founder Derrick Reimer looked at what we he was a co-founder of mine with a previous business. He looked at what we paid for. We paid for 50 different apps across our SaaS company. And one of them was Calendly. We spent a lot of money with Calendly and Zoom and and other things. And he built a competitor 'cause he saw an angle. So those are two of the eight, just to give folks an idea. Nathan: Wow. So you've you've written five books, this is your sixth book, and you've already spoken that you like frameworks. Where does where does this habit of trying to framework everything come from? Rob: Mm. I think so as I was coming up in college, out of college, young, learning, it helped me to read books, nonfiction books, both about personal development, but also about professional development. And I loved Nathan: Mm-hmm. Rob: I'm an engineer. I'm left brain and it helps me to have some type of of guidance or framework that I can latch on to. And so I did like I didn't know how to manage people. I didn't know how to lead people. I didn't know how to hire. I didn't know how to do any of that. And so as I was r would read books and it wasn't just a bunch of broad amorphous advice, but actual, even the cheesy frameworks that are like an acronym, that were like each letter yeah, we've heard them enough now that we're like, okay, I need to set SMART goals. boy. I don't want to hear this again. But the first time you hear Nathan: Yeah. Rob: that, The first time you hear it, it has an impact, And so I think as I got experience and I I looked around at the things starting any type of business, there's so many unknowns. You know, there's so many questions, there's so many uncertainties that as I started to become more kind of confident in my own intuition, but then also had this view across hundreds of successful companies, I started seeing patterns. And I was like, how do you pull those patterns? What what do you c can you do pattern recognition? Can can you come up with a mental framework to identify companies that are going to succeed versus fail or approaches that are going to succeed versus fail? And that eventually became how I did it. And I I started, you start with one framework and then pretty soon you you keep doing this for 15 years and you I probably I don't know if I have 15 frameworks now for just different, you know, varying stages of of starting a startup. So it happened a little organically, but I think it's also because it's what I'm drawn to. It's what helps me when I'm entering a new space is to have a framework. Nathan: Right, yeah. Yeah, that makes a lot of sense. so you've you've backed over two hundred and forty companies, about three hundred and fifty founders. You told me you have a list of what the most successful ones have in common. What's at the top of that list? Rob: So The founders and the idea. They're a multiplier. the idea slash market, right? Nathan: Okay. Rob: I want to talk about founders because I think it's something that if you're listening to this, you can easily change this about yourself. It's about personal development, it's about getting better at it. Cho finding an idea, choosing a market, executing, like those are also very important. But the founder themselves, we when we see really, really great founders. even enter a tough market with not a great idea, they can still succeed. They just won't succeed if they entered a if they found a great market with a great product and blah, blah, blah, right? That that same founder will succeed either way. It'll just be add the extra zero or two to their revenue, you know, or to their exit now. Right. Nathan: Right. Yep. Rob: So that's it. So you can kind of brute force this, unless you have a catastrophic idea or something, but usually a great founder doesn't pick a catastrophic idea, you know? But there's three things. You want to hear my framework on founders? There's three things. And Nathan: Yes, please. Rob: the the best founders we see, and I've known thousands of founders, but like worked intimately with several hundred, the three things are they take action, they have good decent judgment, and they are coachable. It's those three things. So action, meaning they don't get Analysis paralysis. They think, and if they do, they realize it and they try to break through it, right? They they do a lot of things pretty quickly. We'll have the same kind of two founders in parallel. I've literally had these conversations where one will tell me, I I give them advice, you need to get up some versus articles for SEO of you versus your competitors, blah, blah, blah. One founder got them up within 48 hours, just went home and just ground, you know, ground on them and got them up. And another founder, it took him six weeks, eight weeks. And it's like, well, why the difference? Because that founder went and looked for and hired a writer and then decided, we need to redesign this area of the website before we can put them live. And that, you know what I mean? It was just a bunch of reasons to not ship things, right? And so it's Nathan: Yeah. Rob: the it's a comparison. action moving quickly is the number one, period. But the second one is, and they're generally right. So that's what I call judgment. Or gut instinct. Instinct or judgment. They're generally right about things. You do not need to be right a hundred percent of the time if you're moving quickly and doing a lot of things. You need to be right about maybe sixty percent of the time. It's not a lot. It's Pete Sampras, I believe, who I'm gonna miss the quote or the exact stat, but he won a cajillion titles. The reason we all know his name. I don't follow tennis and everybody knows who who Pete Sampras is. I believe he won 53% of his points in his career and 60% of his games or something like that. it's not that many. Nathan: Yeah, yeah. Rob: And yet he's a phenomenal success. That's the same ratio for founders. if you're only right 50% of the time, we might as well go flip a coin. I think you need to be more than 50, but it's not 70 or 80. Like I'm I'm only I'm probably right 60% of the time, 65%, you know? So judgment and just developing that internal core and the instinct, you can build that over time by being around other successful founders. having mentors, having advisors. and then the third one is coachability. And even the best founders I know who know where they're going, know what they're doing and are really good at it, they come and ask for advice. They may not take my advice, but they at least want a third opinion, a second opinion, a third opinion to be like, I'm in this tough spot. I want to take a bunch of strategic advice from five different people and I'm going to factor that into my decision. So even the best founders I know are coachable. Nathan: Yeah, definitely. That first one especially the taking the action is huge because you you you want everything to be perfect, but it doesn't it doesn't matter if it's perfect if no one can see it. Whereas something that's yeah, sixty, seventy percent as good. If it's there, people can use it. It's good enough. Rob: Good enough. Yeah. It's shocking that j that getting if you need to get a landing page up and you cop you do copywriting, you you copyright it yourself or you have AI do it these days. As long as they're not like massive AI-isms. AI is the average of everything, right? So it'll turn out an average landing page. But that average landing page is better than none at all. Like it's kinda sad. Nathan: Yeah. Rob: I mean, that is one reason one of the reasons that AI and all its generation, you know, the generative nature of it is Is better than what most people were doing, which was shipping nothing. Nathan: Yeah, definitely, definitely. so still looking at that list, what what was it on that list that surprised you and something that you'd probably never have predicted back when you started twenty years ago? Rob: I think the coachability thing. So people taking action, it's like, well, yeah, that's kind of obvious, maybe. Being right most of the time, I would have thought you needed to be right more, 80, 90% maybe. And and it seemed to me when I looked around when I was this like late 20s, early 30s, like trying to figure myself out. I like, well, these people know what they're doing. They must be right all the time. That's not true. But the coachability one, I mean, again, I I don't know if it's just the way I was raised, but I was kind of convinced, like, well, if you know what you're doing, then you go out and you do it. And I was youngest kid of four in my family. So I didn't really have a lot of a lot of input and I just did a lot of things on my own. And so to come into this world and realize, even the smartest founders and most successful founders I know, they ask for outside opinions was a big shocker to me. It took me some years to humble myself, to be like, just cause I've had some success doesn't mean I know everything. And that's sounds like a ridiculous. It's not that I had a big ego. It's that I thought I was supposed to know. I thought I couldn't ask for help. So the coachability one is definitely one that I think surprised me and has taken me a while to embody. But these days now, I will go. I mean, my team with Microconfid Tiny Seed is to 10 or 11 people and in meetings with groups of people, with you know, groups of of our team. Obviously, if I say something, it I'm I run the company, right? I'm the the the founder. And so if I say something, people will do it. And people will look to me often to make a decision. I will look to the team and be like, I don't know. What do you guys think? Because I actually want them. They're probably closer to the metal and they're probably have a better opinion on this than I than I do. Even if I do make the final decision, I should get their input. I need to be coachable by my own team. Nathan: And I guess that feeds back into judgment and getting things right. You know, that's gonna bolster that up to that sixty, seventy percent mark if you yeah, you've got your team that are actually creating what you're what you're selling, they'll know they'll Rob: Yeah. Yeah. Nathan: know better than you will potentially. on the flip side then you have another list of why founders fail. what is the top reason there, but w which one took you longest to accept? Rob: So I'll talk about this one a little different. I think I see a bunch of different ways that company like startups fail. And sometimes it is the founders. So if the founders don't move quickly, we do the opposite of the three we just said. If they don't move quickly, if Nathan: Yeah. Rob: their judgment is generally poor, and I see people move quick, and most of the things they do are wrong. They're just bad decisions. Nathan: Ha ha. Rob: And you look at it and you're like, what are you doing? Like, I I it's obvious that's a dumb thing to do. And number three, they either don't, this is the worst one. The they either don't ask for help or they do. I have acquaintances in the startup space, see people on social media, and they ask, like, hey, what should I do here? And they get a bunch of feedback from knowledgeable, experienced founders in private, mostly private Slack groups that I'm in. And then you see them just ignore it. And you're like, why did you waste all our time asking our opinion? You have a bunch of founders here who've done built seven and eight-figure companies, some of us who've exited for eight figures, and you And you are an up-and-coming entrepreneur and you ask and you get all these input and you do the exact opposite because it's what you wanted to do in the first place. Right. So that that is the first thing is the founder doesn't do the three things, that I said. Almost almost at times it feels like they're doing it intentionally, even though I know they aren't. but the other Nathan: They've already got your list and they're just t twisting it the other way just to be stubborn. Rob: Why you it's a knife. It really is. They don't care. But yeah, no, it feels that way sometimes when I'm watching them. I'm like, that's is sometimes how I come up with these lists in in my head. It's pat the patterns of who do I see failing over and over and over, even though they're like a generally competent human, but why have they been doing this for 15 years? And you see them, they have a podcast, they have social media, and they're trying to be a founder and they just never make it work. And I ask, and and there are folks this way, and I know them by name, and I'm obviously not gonna call them out on this podcast, but like They have these commonalities that they generally move slow. They generally make the the comfortable decision rather than the right decision, stay in their comfort zone, which is usually building. I'm gonna write more code, write Nathan: Right, yeah. Rob: more code, I'm gonna revamp, I'm gonna redesign. I'm gonna it's like, no, that doesn't sell anything, And then the the coachability, their inability to take take advice. But that's that's the founder. But then why businesses fail, the number one reason is they don't build anything people want. they just don't build anything people want and are willing to pay for. Right. That's the number one reason we see. And it's it we can define it as product market fit, right? They don't find product market fit, but I just think of it as especially if you're building a startup that has some type of creativity or novelty in it, you can because if you're building a lawn care service or if you're build starting a dry cleaner, it's totally cool. You know, I'm a construction family. I worked construction for years. So if you're starting a construction like a contractor, you don't necessarily need much creativity. You need Probably a decent network, you need to be good at selling, you need to be good at marketing, and then you need to get the work done, right? That's it. if you're starting an actual like a startup that is a novel idea or at least an adjustment or a twist on an old idea, then you have start the real risk that you're building something that absolutely no one wants. And that is the number one pitfall or number one reason I see businesses fail. That is why, dude, seriously, Idea to Traction, the entire the meat of it, it's a 300-page book. I bet there's 120. pages, maybe more, that are all about upfront. It's like validation, some market research, talking to customers, setting up a landing page, building a small MVP. You're just testing along the way because the biggest mistake you can make is get it in your head that the world needs this and then going and building for months or used to be years. I don't think with AI, anyone anything takes years to build anymore. But now it would be weeks or months because you're so convinced that the world needs it when in fact most of the time they don't. Nathan: So that leads me on then to your your talk recently in Iceland on the moats that still work in the age of AI. we should start with what those moats are. and how you said they're at eight. How did you and Einar arrive at the eight? Rob: Yeah. Let me run through the eight. And I took a look at them before you and I recorded. These are specifically for SaaS and software, but I think five of them of the eight apply to any business, brick and mortar, kind of anything you could start. And then there's a sixth one I have a question mark next to. Maybe you and I can discuss it or not. So it's like five or six. But yeah, the the moats are and there's a whole forty-five minute talk on YouTube. You search Rob Walling moats. If you want to know all of them. But the number one is buyers know and trust you. Now there's it's more than just buyers knowing and trust you. These are the summaries, but it's it's that there you have a agencies and referral network that are actively selling you, that there's kind of like an ecosystem. You have a very strong brand and have a lot of momentum. So very it's like Salesforce, it's like QuickBooks. I don't want to use QuickBooks, Nathan: Yeah. Rob: but all the accountants use QuickBooks. So it's not just, they have a brand. It's like, no, it's entrenched. that that's what this mode is. And obviously for each of these, there's a spectrum. So maybe if you're early stage, you don't have the QuickBooks, you know, if QuickBooks is a nine or a 10 out of 10 on this spectrum, you know, maybe you can get to a three or four or whatever. So number one, buyers know and trust you. Number two, you're a system of record. So this means you store data and information in a way that doesn't exist anywhere else in the org. you're you can be the operating system of a business or you can be something where you have kind of proprietary data that and people are working in you day to day. Number three is you're allowed to act, meaning this is where a payroll system is a good example of this, where what is a pa a payroll system is literally allowed to take money out of your business account and cut checks to the IRS to the yeah, IRS to to the you know, whatever tax bureau Nathan: Yeah, yeah. Rob: you're underneath. I I'm in the US. But and it and it literally is allowed to send money to employees. It is allowed to talk about allowed to act. that is the the top line. So Gusto, Nathan: Yeah. Rob: nobody I use Gusto in the US, nobody changes payroll providers because someone offers it at 30% cheaper. No one vibe codes their own Gusto. You just don't because the the the the being allowed to act, it doesn't just have to be money either. There's a company called Churnkey That helps SaaS companies reduce their churn. And once you install their JavaScript in your app, it will actually it's allowed to like present offers to people who go to churn. So that's another way of being allowed to act because it is allowed to act on your behalf and and give discounts and stuff like that to keep people from churning. Number four is that no one checks your work. So that a good example of this is also Gusto. Gusto is allowed to act, but also have you ever, in your payroll provider, have you ever gone in and been like, I'm gonna recalculate the taxes that they paid to make sure they're correct. No, you don't. Nathan: No. Rob: No one does that. And and Avalara does sales tax, like that's a good example of them. no one checks those. You just trust that they're right. And they have years of kind of brand and trust they've built up, right? So a lot of these are around trust. A lot of these eight are around trust, but they don't check your work, is number four. Number five is I phrase it as someone official said yes, but really it's like you need a certification. Whether it's like SOC2, ISO 27001 or even from like third party psycholo you know, psychiatry boards and this and that in order to have training. So there's some type of certifications and and often it's government or it's nonprofit things that carry weight. Number six is basically network effect. I say it's every everyone's in it, but it's like imagine Slack. I could vibe code Slack tomorrow or next week. No one's switching to my Slack. You know what I mean? Even our our Nathan: No. Rob: own company. We ever we all pay too much for Slack. We don't, we don't actually love it, but we're all in it. And the switching cost is just too much, right? Other examples of that. Number seven is this learning loop. Every customer makes you smarter. So it's if you have a thousand customers, a good example of this is Stripe Radar. So Stripe, obviously, payments processing. Stripe radar is fraud and spam. I think it's fraud detection. Stripe looks over their millions of cut of merchants. And they see all types of patterns, right? I mean, it's gotta be AI/ML like crazy on the back end. And it can tell it can predict when something's gonna be I almost said spam, but when it's gonna be fraudulent, right? Nathan: Yeah. Rob: And and if you let's say I got rid of Stripe and I switched to whoever, some other payment processor, I don't have that, can I build that myself? No, because I don't have the data from millions of custom, you know what I Millions of merchants. So Nathan: Yeah. Rob: there's a lock in there, right? Every customer makes you smarter and you learn and build a better system. And the eighth one is that your system, your app, whatever, your business is hard to keep running. And so an example of this is when you have a lot of, say, DevOps work, which is like like Cloudflare is an example of this. You and I could go five code Cloudflare. It's just a, for those who don't know, it's kind of a proxy over your website and it stops DDoS attacks. It does, it does some technical stuff. Building Cloudflare would be really real building it would be easy. Maintaining Cloudflare, keeping it up would be catastrophically hard. It's just such Nathan: Yeah. Rob: a like no one vibe codes or no one's switching from Cloudflare, So those those are the eight. And as I said, I think there's five of them that apply. We probably don't have time to go through which apply and dive into all that, but but that's where we are. Nathan: So you said you said in that talk that a lot of the old defenses are drowning away, like like you said, unique features, integrations. It took us years to build. Now it'll only take you months, maybe a weekend, depending on what it is. What's the equivalent of it took us years to build for a business that isn't software, do you think? Rob: Good question. So I'm trying to think of a construction. My brother still runs a an electrical contractor. And I'm trying to think if there is an advantage. I guess it's whatever legacy, what have they spent years building that AI can suddenly undo? I mean, what if I was a small, like I used to work for a small credit card company and we had a call center and we had a hundred humans answering the phone. And we build, I was in the software, I was a senior engineer there. We built software for everyone to to build it, to get in the system and do whatever, right? You need software to to to manage that. a lot of those agents, those humans are gonna be AI agents, like just AI bots that answer the phone. So that's an interesting thing of what if I started a credit card company and I was just like, We're not gonna have a hundred, we're gonna have twenty. And then we're gonna have 90 agents that are picking up the phone, and it only needs to get escalated if they can't handle it. So now you have this legacy. You either have to lay everybody off, you have this learning curve, and whereas I can start fresh with the I'm not saying it's a good decision, but it is it, it's a decision that the businesses are gonna make. that's one example I can think of. The the trick, of course, is when I think of a construction firm, a My brother's going out and installing physical things and to date AI isn't really AI isn't replacing any of that. The only thing I could see AI replacing is estimating. I don't know if you've ever seen a a set of blueprints and you have to do takeoff and you have to measure everything on it. Nathan: Yeah. Rob: And then you have to estimate a million dollar job. It might take you weeks to do all the takeoff and measure everything. I could imagine the I used to be an estimator at a electrical contractor and we had a whole team. There were fifteen, twenty of us. Couldn't AI, I think AI is gonna be able to to do that pretty soon. But th what are you gonna do? You're just gonna lay off I guess at that point you just lay off your estimators and use AI for it. So Those are Nathan: Yeah. Rob: halfway decent examples. Those are not great. But but you see where where we're getting at is where does AI make something much easier to where you have an advantage if you just start there today. Nathan: Yeah. With so with talking about AI replacing an awful lot of stuff. With your founders, are you are you seeing like when it comes to younger founders, maybe it's too early for this to have started yet, but if AI is taking over a a lot of the junior level roles, or is capable, like A agents are capable of taking over a lot of the junior Junior level roles. Are you seeing founders who are coming through to you that don't have the experience that you would expect them to have at that age because they don't they haven't done the junior level role to get the knowledge that you think that they should have? Or is it completely the other way around where because there is so much information out there, there is they can use AI for absolutely everything. They can bring in almost the opposite of so much more experience than they would have had at that age twenty years ago. Rob: So I think that your first comment is a prediction. You said, you know, are are people coming in now without say junior engineering and s you know software development experience? Not yet, but it's gonna it has to happen because no one's hiring juniors anymore. So I think within the next few years, we're just gonna see that across the board. There are just gonna not be juniors. And so then it's like, well, will we ever have how do you get mid level then? Cause you used to you used to climb a ladder. So do you just you don't just Nathan: Yeah. Rob: start it? Do you start at mid level? Like That's a whole question that I don't think I I don't think we have time to go down. Nathan: H Rob: but the second piece is you know, you said, or do they come in with more experience or at least more capability than they otherwise would? The answer is yes. Absolutely. Now, whether that code, you know, I think we're right at this cusp. It feels like it to me. We're like, Six months ago when you vibe coded something, it was like, it's not gonna have great security, it's not gonna perform, it's not gonna you there's a bunch of downsides to it. You need a senior engineer that's correcting it. I think six months from now, that doesn't seem like a real issue anymore. it really even senior devs I know are not looking at the code anymore, which is crazy to me. And I don't know how big of a system you can build that way. I don't know, because context windows are only so big. And what if I have a million lines of code? Can AI still handle it? Whereas a human can't. There's some questions for me still there. But overall, yeah, we have we had a twenty-six-year-old applied to TinySeed, my accelerator, who had built a ton of stuff and was acting like a three or four person team because they are using a lot of agents. Now there is a question of will that code need be rewritten if they're non-technical. And I I don't know yet. It you the answer as of a you know a few months ago was yes. But moving forward, I don't know if I don't know if that will continue to be the case. But yeah, the capabilities, my sixteen-year-old. Is starting, he wants to start an a GEO agency, right? AI SEO to be to raise visibility in LLMs for any any business. I the stuff he's cranking out and the stuff he's learning. He he read a couple books, he then did a test project, he used Claude Code, did a test project for my wife, Dr. Sherry Walling, who's a founder and an executive coach. Now he's doing a test project for me. The results he's getting are ridiculous. I was like, are you I asked him, are you sure these are right? And he did a whole pass Nathan: Yeah. Rob: through the prompts and then he put a bunch, he put some content out, some versus pages, some whatever. He did it, he did the playbook. It's F-A-Q. The playbook for AI SEO is not that complicated, but he learned it and he used Claude Code. And then he did it, and she got like twice as many, you know, client form like form submissions, twice Nathan: Yeah. Rob: as many leads is the best way to say it in a month. And I was like, Nathan: Wow. Rob: This this kid is 16. Like he's never coded, he's not a marketer, but he is learning. So that these are examples of like. If he's doing that now, what's he gonna be doing when he's twenty if he keeps going, So it's a magical age. It's maybe the best time in history to be an entrepreneur, or maybe it's but maybe it's the worst time to be a big company. I'm I'm still trying to figure my head around that, you know, 'cause like AI is coming for for Nathan: Yeah. Rob: a lot of stuff. Nathan: Best time to be starting, worst time to be a couple of years in because those kids will those kids will get ya. Yeah. Rob: And honor Yes. That's a good way to put it. Mhm. Yeah. Nathan: TinySeed has said That ten million a year is a great business, while VCs would call it a failure. what does that difference in maths do to the kind of ideas then that founders choose to pursue? And do you think it has like a a knock-on effect on genuinely new creative ideas? Rob: Mm. Yeah, because the venture industrial complex really limits the kinds of ideas you can attack because they do. I mean, it used to be like, well, we'll only invest if you if you can become a billion dollar company. And then it became it, it literally is like, Decacorn. You need to be able to do 10 billion or else, yeah, whatever. You know, that's not everybody, but is like there are Nathan: Yeah. Rob: there are VCs that only, you know, the top tier, they only say Decacorn are bigger. So that leaves out a lot of businesses. That leaves out probably 99 po percent of all businesses that could be started. And some of those, let's say of the 99, you know, 10% are software other software companies. That's what TinySeed tries to fill that gap of like building tools for other businesses that solve a pain point, a real problem that they have. And so with our economics and the way we invest and and the way that if you were to sell your company for 20 or 30 million dollars We would, 10x our money, 10 or 15x our money. That allows us to get people to go after really small markets, which is neat. We have a company called Senior Place, which is software. It's like CRM software for senior placement agents, which help in the US specifically. Like if you have a grandparent who needs to go into assisted living, these senior placement agents are kind of like realtors. They know all the, all the facilities, right? And they can help match you up. You give them Nathan: Gotcha. Yeah. Rob: criteria because there's no public listing with all the criteria, right? There maybe AI can do this for you now, but whatever. there's only Nathan: Mm-hmm. Rob: 3,000 of them in the US total. And we have a company called Senior Place that is doing really well and built an incredible business and continues to grow with total addressable market of 3,000 customers. And their starting prices, you can go to seniorplace.com. I don't remember if it's three or four hundred dollars a month. It's not that much. It's not like they're charging, you know, you could say, well, a small market, but you're charging 10 grand a month, right? Or 20 grand a month. It's like, okay. But yeah, they're charging three to five hundred a month to start with. And yet they have this great business that venture VCs would never look at. And yet we have many really nice niche vertical companies in TinySeed. And when you're a niche vertical, you actually have more of these moats. You often do. It's often like you do build that buyer trust early on. You're often, if you're in a vertical, you're building a bigger system. So you're often a system of record that's allowed to act. where they don't check your work. I just covered the first four moats there. When Nathan: Yeah, of course, yeah. Rob: you're a big you know, when you're a big horizontal play, meaning you're across any industry, it's harder to get, you know, any of these modes. Nathan: Yeah, 'cause then some of those smaller ones could just be like, right, well we just do this, but we do it fantastically rather than, you know, this works for X, Y, and Z. Yeah. Rob: Yeah, that's right. Nathan: so going back to frameworks. frameworks give you 80%. AI, again, very good at frameworks. Do you think that that creative ten to twenty percent is gonna become the whole game? Is it gonna become the only thing that can separate you from literally everyone else? Rob: seems, it seems like it, like AI can do AI does average work right now across a lot of domains. And if if you're a if you're a 16-year-old starting a business and you don't know anything about copywriting, being an average copywriter is pretty good. So my kid built his Nathan: Yeah. Rob: website and it's it's like decent, right? It's like, but if you're a nine out of 10 copywriter, you're an amazing, you've done it your whole life. You're gonna look at AI copy and be well, this slop is not nearly as good as I would write. But so where where's the difference? And that's what that's what we're saying is it's that is it that 20%, 30%, whatever the number is, right? It's it's a it's a small portion though, and it's becoming tighter, especially in these things that are more formulaic. Writing code is formulaic. I'm a devo I'm a software developer. It pains me to say creativity, building software is my life's work, being a maker, that is just becoming less and less valuable by the day. And and Copywriting is becoming less and less valuable. Will all will we always need copywriters? Probably. Will we always need developers and product people? Yeah, probably. But what they do is that what makes a difference now is that creativity, I guess, but I'd also call it judgment and taste. There's like a certain level of taste, you know, of Nathan: Okay. Yeah. Rob: like I'm gonna build this a little different, I'm gonna build it better, or I'm gonna write like I used certainly used AI to help me. right idea to traction. I never said go write a chapter on XYZ. I would take an entire podcast or a I had a course. I take transcripts or I would just dictate and I would stuff that into Claude and I've trained Claude there's a thing called Rights Like Rob, you know, to to have my voice. And it would turn my thoughts, my ideas and my transcripts into a first draft of an essay. the of a chapter. Then I would go through I didn't do that for every chapter, but a couple chapters specifically. Then I went through and I combed through it and I was like, I don't say that, I don't write like that. I don't this and that. But that is one of the reasons the book got done. I wouldn't have written the I Nathan: Thank you Rob: just didn't have time to write the book without that, right? Nathan: Did you notice a difference in maybe quality is not the right word, but like accuracy maybe between the chapters that you did do that with and then the chapters that you just did yourself? Rob: Not really. because the only difference since it was all my thoughts and ideas, like I didn't let Claude or AI put any new con like, introduce this framework. It's like, no, this is my stuff. Nathan: Right. Rob: So the only difference would be in f maybe phrasing, like sentences, how sentences were phrased. And I learned long long ago, because I actually worked with a ghostwriter on a pri a prior book with a very similar concept or a very similar approach. Where it was my ideas, my thoughts, and she would either interview me or I'd I'd do a 30-minute audio, she'd transcribe it, turn it into a chapter, right? I felt the same thing where I'd read her work and say, She'd she's not saying that the way that I would have said it. And sometimes I either corrected it or sometimes I just let it go. And I asked good friends of mine who've read all my books, like, Did you notice anything weird in the book? And they're like, Nope. No one else noticed that I wouldn't have said it that way because I'm the only one who notices, you know? So Nathan: Yeah. Rob: it's a really interesting. Interesting thing. And sometimes it bothered me. My taste was really picky. I actually want this analogy or that turn of phrase I would never use, so I would fix it. I don't think anyone else cares. And so that's the judgment, instinct, taste, and creativity. I think we're lumping into Nathan: Hm. Rob: one thing, which is which is fine, but it's the human element that will AI ever get there? I don't know. Nathan: Yeah. what's last thing on frameworks, start how we ended. What's the one framework you'd hand to a founder in any sector who wants their next idea to come from somewhere repeatable rather than lucky? Rob: Well, I mean the the eight approaches for coming up with ideas that I mentioned earlier. It's not a framework per se, but it kinda I can't I didn't name it, but it kind of is. It's it's eight approaches under an umbrella. I that one is handy, and if I were starting over again today, I would a hundred percent go through all eight of those myself and use it to generate ideas. And then I'm gonna give I'm gonna give a bonus answer, the two twenty two hundred framework. Which is all about validation, spending two hours and to do a certain amount and twenty hours to Nathan: Yeah. Rob: do, you know, certain more. those y you don't have to follow two twenty two hundred exactly, but at least do something to validate that your idea is marketable, that people do want it, that there's demand, you know, it's like these are the biggest mistakes. It's it's the the early stage. There's a reason that, mm a lot of companies fail is that they don't validate that there's any need or they're that they're different or that they can market what they have, whether you're starting a new construction firm, a new web agency, or whether you're building a software product. Nathan: Brilliant. Well, that's all we have time for today. Massive thank you to you, Rob, for joining me. Rob Walling from TinySeed and MicroConf. Innovation's less about waiting for genius and more about running the right framework. Then adding that last little bit of creativity yourself. If you like this episode, please check us out at the Innovation Philosophie Instagram. Leave us a comment or send us a question. See you next time, Impact Maker.