Latest / Success Story with Scott Clary / David Hauser - Entrepreneur, Author, Speaker & Investor | How To Transform Your Life

Transcript

David Hauser - Entrepreneur, Author, Speaker & Investor | How To Transform Your Life · Success Story with Scott Clary

• 0:00
  We have this monkey brain and we just keep thinking and thinking and as entrepreneurs were like what's the next thing what am I doing what am I concerned about all of these problems I find it hard to sit but in yoga the movement was the breath gives me the ability to calm the mind a lot of times we ignore people and we get things right I think that stepping back sometimes and understanding that it's okay to slow down sometimes to get the foundation right what is it that I want to build where I want to be think if you can answer that question strongly
• 0:30
  great path to success but it needs to be in tension business coach I think is a catalyst along that path they don't do it for you but they give that push the founders that send regular email updates about the company are more successful and those don't welcome to success story I'm your host Scott Clary the success story podcast is part of the HubSpot podcast network now HubSpot is the resource that you need to tap into if you are an entrepreneur it's no secret that
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• 1:59
  David thank you for joining me I appreciate you coming on when I look at your resume there's a lot of fun stuff that we can go into however I
• 2:07
  thought that it was interesting when I sort of looked at all the different things that you identify as you're a founder
• 2:14
  you're an investor but you're a father but also you're a yoga enthusiast and I think it's interesting
• 2:21
  because I think that really speaks to how much you care about health and wellness and I think that
• 2:26
  everybody is listening to this will expect to me to go into the business conversation right away
• 2:31
  but I want to flip it around and I want to sort of speak about why health wellness you've spoken
• 2:37
  in about a ton of different topics diet meditation and different podcasts why is that so important to
• 2:43
  you yeah so I actually just came from a Pilates class so I go really regimented routine for my
• 2:50
  mornings right so like if you look at my night full days very regimented like by calendar runs
• 2:55
  everything but really that the reason is so I can free myself up to do those things that I
• 3:00
  think are important for how I'm up right like it's not just so I make meetings on time like that's
• 3:05
  probably a benefit but like everything's on there like time with my kids and things I'm doing like
• 3:10
  all those things right so my mornings are very much about me like I spend the first few hours in
• 3:16
  the morning I get a pretty early just naturally I don't have a alarm clock I just wake up when I wake
• 3:21
  up I go to bed early so it helps getting up earlier but I work a few hours I take my kids to school
• 3:29
  and then I go to the gym right like that's my morning routine every day and then on weekends it's
• 3:35
  roughly the same except I just don't take the kids to school right like that piece drops out but I
• 3:39
  keep the rest of that routine going so obviously I love yoga love Pilates lift weights a few days
• 3:48
  a week I think breathe very important like lots of those things but it's really focused around that
• 3:54
  yoga and Pilates you know kind of practice and once a day at least why is that out of all the
• 4:01
  different things that you could take on in terms of health and wellness is there a particular reason
• 4:05
  because you seem like a very logical regimented process oriented guy so like there's a there's a
• 4:10
  reason why you're doing everything in your life and this is probably why you've been successful in
• 4:13
  business and you've allocated time for your family and you've built a beautiful family as well
• 4:18
  like everything is done very purposefully so why yoga why Pilates what are the what are the reasons
• 4:25
  so so like I've tried all sorts of things right like I did triathlons I did marathons and I'm a
• 4:30
  terrible runner so just pull this code like I did those things really because a friend said like
• 4:36
  you could you can't do it so I just did it I think my downfall or maybe you know my mom always
• 4:42
  says that this is one of the things that's bad about me I think it's one of the good things about
• 4:46
  me like I'm very all in or nothing right like not just black and white but like extreme right so like
• 4:54
  take yoga like I went to a yoga class or whatever it was eight 10 years ago I'm like I like this
• 5:01
  so I went every day the next week I'm like okay I still really like this so then I did a 200 hour
• 5:06
  teacher training the next month right so I pro deep pro to 60 very quickly and all in but really
• 5:14
  what I found for me was that 60 minutes a day was one of the few times where my brain stopped thinking
• 5:22
  about other things right and I think that that's what we really look for in meditation and we try
• 5:27
  so hard we're like we have this monkey brain and we just keep thinking and thinking and as entrepreneurs
• 5:32
  were like what's the next thing what I'm doing what I'm concerned about all of these problems
• 5:37
  and I find it hard to sit but in yoga the movement was the breath gives me the ability to calm the
• 5:45
  mind and have that not full 60 minutes but close to 60 minutes every day where I'm not thinking about
• 5:52
  those other things I love that and just a just a point I you know your personality I think that's
• 5:58
  very common personality and in highly successful entrepreneurs high achievers where they just
• 6:03
  it's all it's almost a blessing that that personality is correlated with business building because
• 6:09
  that same personality of doing things to an extreme is probably not that different from somebody
• 6:14
  who gets addicted to really bad shit too you're just focusing that in a more positive way but it is
• 6:19
  this like wild obsession and then it ends up being a very net positive in your life but there's
• 6:24
  a certain kind of personality that's like a little bit outside of what I think most people call
• 6:28
  normal for an entrepreneur to actually commit so much of their life to building this thing and you've
• 6:33
  done it several times and you work with you know tons of different people that build it in your
• 6:37
  in your portfolio company so you see it again and again and again and again but I just think
• 6:40
  it's an interesting personality quirk and I don't think it's that uncommon but you know I think my
• 6:44
  parents sometimes say the same thing yeah my mom still doesn't like it I think yeah to live with
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  um so so my my girlfriend probably doesn't like it either but um I think the other thing I
• 6:55
  noticed too is if I look at some of the best programmers and developers inside of our companies
• 7:00
  yeah similar traits that are applied differently right so like they're extremely you know
• 7:06
  connoisseurs of coffee or beer or something but it is extreme right and I think those people
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  also perform the best from a development standpoint because they're just as extreme when it comes to
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  testing when it comes to what they're actually producing so finding ways to apply that obsession
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  in a healthy way is probably good for a lot of people and it comes out in different places right
• 7:32
  yeah I think that's a hundred percent on point um you started this mindfulness
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  portion of your life after you were building grasshopper I'm assuming right this is the yoga
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  of the Pilates was this at a later stage or was this during it was but so like if I look back
• 7:51
  at the history so when I was building grasshopper the very early days I was tremendously unhealthy
• 7:56
  working crazy enough hours overweight eating crappy food like that wasn't a priority I did shift
• 8:04
  pretty early in that journey probably call it two years in and I'm like I remember the day I'm like
• 8:09
  these jeans don't fit again I'm like this is a problem um I don't feel good about it so I'm
• 8:14
  gonna do something yeah I did a different extreme thing at that time which was I ran the Boston
• 8:20
  marathon from never never running more than like you know outside for fun right like just playing
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  games never have run for a period of time um trained through the winter in Massachusetts I ran
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  the Boston marathon not fast no but good for you and thank god you didn't have a hard time jumping
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  into something like that I then went out there and said okay like I'm just gonna go all in on
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  this and I started doing half lines I did a half iron man in Austin I I kept doing those things
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  so I was able to lose weight and probably being more healthy than before but I was killing my body
• 8:57
  right like that extreme amount of activity was probably not good um I didn't really find
• 9:05
  yoga and a mindfulness practice until probably two years before I sold grasshopper so I had more
• 9:13
  mind space um also really lucky and happy when I found it it helped me through the sale well I was
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  I was I was at this or the follow up question was how does that change your ability to make decisions
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  and how does that change your ability to think and your clarity of thought and your reasoning and
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  your creativity because I think that that's a that's a hack like people just people just go balls
• 9:36
  to the wall when they're building and like to your point where you let your your physical your mental
• 9:40
  health go that's pretty unfortunately normal especially first first time entrepreneurs and super
• 9:45
  curious as to how this practice has informed basically everything you built including that
• 9:52
  sale grasshopper which is obviously incredible sale talk about that then all the other decisions
• 9:56
  you've made going forward yeah so I think kind of skipping forward in the story a little bit
• 10:01
  the grasshopper sale while very successful monetarily um we can talk about how we got there and all
• 10:06
  those things was actually really difficult from a mental and personal perspectives right taking
• 10:13
  something that I've been building for 12 years and then just being gone right like for 12 years
• 10:18
  I was the grasshopper guy right like that's what I did like you to my family new friends like
• 10:23
  and then that was just got and losing that part of your identity is really really hard and
• 10:30
  I think without a mindfulness practice and for me like that focused time in the morning I don't
• 10:35
  know how I would have gotten through it like because their mind just continues to race more and more
• 10:39
  and more and more in those scenarios and that calming every day on a routine I think allowed me
• 10:46
  to slow down and make better decisions about what am I going to do next I'm not going to rush into
• 10:51
  something right away like things like that but also to be able to sit with the discomfort right like
• 10:57
  I think if prior to that I would just want to run away from it right and filled it with something
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  else a different exercise you know a different company a different thing right and filled that gap
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  rather than sitting there with that discomfort and saying you know what it's okay to be uncomfortable
• 11:12
  right now it's part of this journey and part of this process very very smart I'm curious
• 11:19
  after you you know you went through this process and you sort of cleared your mind to a degree
• 11:23
  for the sale of grasshopper and if I'm not mistaken you sold that to Citrix for this is on record
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  175 million correct that was the that was the sale price is that yeah okay perfect okay so
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  that was a great exit you built after this chargeify that was also acquired by battery ventures
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  and then you've also invested in I don't even know how many startups like I'm sure 50 60 plus
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  different startups I've heard that you've invested in a whole bunch of other types of business as
• 11:54
  well I heard you on Bradley's podcast talking about a restaurant you lost money so you've done a
• 11:59
  whole bunch of different types of investments but the question is looking back at how you built a
• 12:04
  grasshopper in the last two years you adopted some super healthy mindset things and then that probably
• 12:11
  allowed you to think clearer for the companies that you built after the companies that you invested
• 12:16
  in after what would be the because I don't want to go through the whole grasshopper store but I would
• 12:23
  say it's interesting to understand what you did with grasshopper that you probably shouldn't have
• 12:28
  done what were the things that after starting chargeify growing it exiting that company working with
• 12:36
  50 different founders what are the lessons now that you tell people like hey I did it for 12 years
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  it didn't have to take 12 years or could have been way easier yeah so I actually love that it took 12
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  years and it should have been easier but really what I learned a grasshopper and we built chargeify
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  at grasshopper it was a lab project we built all sorts of things the biggest mistake we ever made
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  was doing this and it's kind of weird to see that right because chargeify came out of it and
• 13:04
  it was very successful and we exited it but as a whole you was a terrible terrible idea building
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  these things within grasshopper right like chargeify was successful yes but there was lots of them
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  that were we wasted a million dollars of capital that we could have invested in the company to do
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  things we've been we lost our time the team's time and focus rather than saying like let's sell more
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  of the thing we're doing we're like no no like we're gonna identify this opportunity we're gonna
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  build this thing we're gonna it was terrible right I think the most important learning for me
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  from that was besides the distraction like that was a bad thing what we really should have understood
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  was we need to be the customer ourselves where we failed every single time is when we said oh we're
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  gonna identify this market we think that this market operates this way this customer operates
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  this way but we're not the customer right and for grasshopper we were the customer we were the small
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  business owner that needed the phone system for chargeify we built it for ourselves of the building
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  system for us right those that's why it was successful the things that weren't were different
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  customers with different needs so then we had to do this like work research like all these things
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  happen yeah super time consuming super expensive yeah why why I'm curious so when you're running
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  when you're running you bootstrap grasshopper like hats off to you for that that's already
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  wildly difficult to do you grew to 30 million dollars I think ARR what prompted you to say hey I want
• 14:38
  to look at different market segments I want to try different technologies like what happens in the
• 14:43
  brain of a founder that creates this need for shiny objects syndrome I mean it happens to a lot
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  of founders I'm curious why you thought that trying all these different projects was a good idea
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  because someone else in this audience is thinking probably the exact same things that you were
• 14:57
  thinking so let's just like what are those red flags like what are those things that prompted you
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  to say I want to test this thing out yeah I think it's two things one founders get bored so we're
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  like let's just do something else right when you think buying that with the plateaus that companies
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  naturally hit we convince ourselves with these stories that we've saturated the market we can't
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  grow anymore right because you get these plateaus at five million ten million or whatever the
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  things are and you're like growth kind of plateaus a little bit and we all sit there and then we
• 15:29
  create this narrative we advertise too much we can't do anymore we've saturated Google add we
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  would whatever this things are we create to tell ourselves a story about why we're at this plateau
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  rather than investing the company and saying what we really need to do is look at new team new
• 15:48
  process new things to move to the next level and get that step change growth over time and like
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  really if you look back at Grasshopper we were nowhere close to saturation I was going to say no
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  you could have taken that you could have yeah it's right but like we created this narrative
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  three separate or four separate times at Grasshopper right so funny how you you just getting your own
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  head you totally getting your own head too even when you're successful you get in your own head
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  yes smart people around you yeah but the more difficult thing is as the founder you also then
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  getting your management team said right and you convince them of the story that you've been telling
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  yourself right because they're like look I've already followed this leader right I believe in
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  he or she and they've got us thus thus far why should I believe right about this plateau in this
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  saturation or whatever so now you now you have a group of people all supporting you it's it's
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  really hard well you build this like little echo chamber in your company because nobody's no
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  unless somebody is incredibly experienced and they feel comfortable putting their hand up and saying
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  like and you've built the call we'll talk about culture you've built the site the psychologically
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  safe culture where somebody can actually put their hand up and say adamantly like say something
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  that's adamantly different from what you believe as a founder which is like it's this weird
• 17:09
  power dynamic rate like very few people very few executives are willing to do that
• 17:14
  they're kind of just going to go go in line with what you're saying to a degree and they're
• 17:19
  going to try and execute it to the best of their ability but I'm sure you I'm sure you now you've
• 17:23
  understood that you saw for that so how do you create this culture especially in your portfolios
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  where the founder doesn't know best all the time and you have to create this psychological safe
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  culture where somebody is going to stick their hand up and challenge the founder so that they don't
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  fall into that same trap I think what's even more difficult is we had a culture of that people
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  did raise their hands at the beginning but you become so convincing over time and as a founder
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  is like sometimes I'm just going to do things right so like people probably told us you shouldn't
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  build these companies internally I know we had conversations about the distraction and the problems
• 17:58
  we were going to cause but as founders we ignored it right it wasn't that people didn't say it
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  we just kind of bulldozed them because we were bored or you know we created this narrative right
• 18:10
  that's the danger right because as founders there's this hush and pull of this power right and a
• 18:19
  lot of times it's successful right like a lot of times we ignore people and we get things right
• 18:25
  right that's why companies have step changes that's why these things happen and innovation happens
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  but sometimes we do the same thing with a negative result and we go over someone and we just do
• 18:36
  what we're going to do right so it's a push and pull yeah it's just something to be aware of I
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  think more than anything because I think that every founder is going to get themselves into this
• 18:45
  trap at some point so I think it's just to be cognizant of that and just to be aware of your own
• 18:49
  biases as well when you're building something one thing I found fascinating is the fact that you were
• 18:54
  17 when you started grasshopper is that correct that's a little bit old man I was in high school
• 19:01
  but I had started another company in high school when I was okay but still that's like that's
• 19:06
  super super young that's that's that's that's not even Stanford grad entrepreneur avatar right that's
• 19:12
  incredibly young so what what was it was it your parents were entrepreneurial like what made you
• 19:17
  want to start something so yeah yeah so a few things like my dad and my grandfather were very
• 19:23
  entrepreneurial my mom was very much focused on education so it was a very interesting household
• 19:28
  because we had this dual focus on how important education can be but also how important it can
• 19:33
  be doing your own thing right and independence and building so I think there's part of that the
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  other piece that was really important for me and I say this very specifically is I overcame a
• 19:43
  very difficult learning disability in my early years so I was years behind in reading and writing
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  I went to tutoring five days a week luckily my parents could afford to to spend that money to
• 19:55
  give me the gift of learning how I learned right and then you know now I can read it right obviously
• 20:01
  but you know that that gift taught me how to learn right so I used that through the rest of my life
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  for how do I pick up information and how do I learn and understand things so I knew I was
• 20:14
  going to be an entrepreneur like I remember back to Greece not preschool but like you know
• 20:19
  whenever grades like whenever you were young you were young as hell yeah like whatever doing stuff
• 20:25
  on the computer and building websites and stuff like that yeah when I last year high school I found
• 20:32
  a company return path it was on the early team I built the original software helped raise a lot
• 20:38
  of capital and bring in a management team but I had this decision point do I go to college
• 20:45
  where do I keep doing this and I was all on keep doing this this was you know the early 2000s 99 2000
• 20:55
  2001 roughly in New York on Broad Street with all the internet companies right across from Wall Street
• 21:02
  like it was fantastic my mom convinced me to go to college and I picked I own one college I wanted
• 21:08
  to go do hey guys Scott here I just wanted to take a quick moment to say a heartfelt thanks to
• 21:14
  every single one of you six years of this show and it's really all because of you your listens your
• 21:19
  support your shares it's what keeps this thing going when I started I had no idea how big this would
• 21:24
  get how many lives we touch the stories we share the lessons that we learned together it's truly
• 21:30
  humbling and I believe that we're building something really special here a community where no one
• 21:35
  has to reinvent the wheel we're all in this together learning and growing and here's my ask if
• 21:40
  you love this show it's made a difference for you please share it with somebody who needs it
• 21:45
  hella friend post on social whatever works it's the best way to keep this thing going strong
• 21:51
  bring on even better guests and share more life changing wisdom and you can find us on all the
• 21:56
  spots so you can go to success story podcast.com if you like listening to podcasts if you like
• 22:01
  video you can go to youtube it's youtube.com slash c slash Scott Declary or the newsletter newsletter
• 22:09
  dot Scott Declary.com just spread the word I'm eternally grateful for each and every one of you
• 22:15
  let's keep learning let's keep growing and let's keep making this world a little bit better
• 22:20
  together all right let's get back to the show um I also want to understand at that age how you
• 22:27
  raised capital because I know again a lot of people listening to this they're gonna come up with
• 22:31
  every excuse in the book as to why they can't raise money you don't have enough experience to
• 22:34
  start whatever you just said you know if that I'm gonna lean into this um how do you how do you
• 22:42
  how do you demand the authority to raise capital like last year of high school for right before
• 22:50
  you go to college what what was the strategy to get people to trust that you're gonna not totally
• 22:55
  lose every single dollar they put into you I mean look I had a Greek family co-founding team right
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  yeah older than me so I had experience on capital raising um after had internet companies right so
• 23:08
  like they brought me into that space and I learned a lot I love it I was definitely not the core
• 23:13
  capital razor zero chance about that but I learned a tremendous amount of being in those rooms
• 23:19
  and what what I brought was I built the technology and at that time it was kind of cool and
• 23:27
  interesting for VC Fouts for VC companies to say this young kid is doing right and that I think
• 23:35
  gave us an advantage in the capital raising more than a decision right you were you were like
• 23:41
  almost like a little bit of like a child prodigy like building out this piece of that wasn't
• 23:45
  smart enough to be called that I just happen to feel technology they they've worked I love that
• 23:51
  and and when you started building a grasshopper what was the what was the thesis behind that
• 23:56
  it was actually quite simple like we were building it for ourselves we me and my co-founder each
• 24:00
  had our own small little doing whatever um and we're like what we want these are professional
• 24:07
  image a phone number that's not our cell phone not our house phone you know what your mom
• 24:11
  thinking of the phone right like we knew the problem and we said this is soluble right like
• 24:17
  there are there's been phone systems for 40 years there just hasn't been a virtual one the way we
• 24:22
  want it right like you have to buy far to where and install it and have it and all like we're like
• 24:26
  no we don't want any of that we're in a dorm room like so we built it for ourselves and I think
• 24:33
  combined with a lucky timing right so one is we built the right thing we understood the customer
• 24:39
  because it was us but then it was also a lucky timing that we could buy traffic and customers
• 24:45
  at a really low price that dynamic doesn't exist today anymore right like this was before adwords
• 24:52
  yeah that's that on the chair like where you were paying quarters of a cent right like
• 24:57
  gargie I love this so I mean this is this is the I'm sure this is what you you now look for when
• 25:03
  you're investing in companies like founders that are solving their own problems or maybe founders
• 25:07
  that come from an industry that are solving problems I think that massively increases the
• 25:11
  chance of your success and when you're building a business because it seems like this is what you've
• 25:14
  done repeatedly you built grasshopper for yourself you built you built a chargeify to solve a problem
• 25:21
  you had and it was also successful so this seems to be like the framework when you're trying to
• 25:27
  find some semblance of product market fit like just solve problems that are present in your own life
• 25:32
  which seems like common sense but we all know common sense isn't common but you know you take
• 25:37
  grasshopper to market it's it's obviously you're you have paid ads customers are converting
• 25:45
  how fast is grasshopper start to grow very fast and I think that we were we were lucky on the
• 25:52
  timing of the ability to purchase ads but also the kind of change in the economy right like
• 25:57
  2004 5 6 7 you know there was it was a difficult time but what came out of that is people were
• 26:04
  starting their own companies right like as people were departing jobs being fired you know
• 26:10
  things like that downsize like you know what I could be independent consulting I can do this on
• 26:14
  my own so we added uptick in new companies right and we relied on new companies for our customers
• 26:20
  right like it's hard to convert someone who's been around for a long time compared to someone
• 26:26
  who started a new company a new phone number right like they just kind of mesh together
• 26:30
  but from a growth standpoint we we're profitable in our second month um we you know we had a
• 26:36
  positive cash cycle which allowed us to grow uh we got to a million dollars far quicker than we
• 26:41
  ever imagined and started to have to hire employees and do things they couldn't just be us anymore
• 26:48
  right and that speed was not what we ever expected and and a lot of people can
• 26:54
  just sort of fumble when they're growing at that pace um because there's a lot of things that are
• 27:00
  all moving at the same time and it's just it's stressful it's difficult you know everybody who's
• 27:04
  listening to this is probably praying that they have a business that eventually grows at a pace
• 27:09
  that they can't keep up with but I'm sure that it's happened a few of them what would be
• 27:14
  like the best advice you have when you've nailed product market fit nailed timing um your customers
• 27:20
  are like pouring in how do you not screw that up but I know it sounds silly but I'm sure that
• 27:26
  you can screw it up quite easily if you don't pay attention to reducing churn uh spinning up
• 27:33
  servers uh customer uptime especially for phone systems which are kind of a mission critical
• 27:37
  thing for businesses like how do you not fumble that I mean we did phone right like we made a lot
• 27:43
  of mistakes along along the way and the real danger is sales hide everything right showing a growing
• 27:49
  company all sorts of things can be going wrong culture can be going wrong people can be going
• 27:55
  wrong product can be going wrong but if sales are growing at that pace it's all hit right like
• 28:01
  as no one's looking at anything else even if you're trying to you're just not right and I think
• 28:06
  that stepping back sometimes and understanding that it's okay to slow down sometimes to get the
• 28:13
  foundation right we didn't have our core values specified and written out and communicated
• 28:19
  big mistake right we had to go back and redo that and it wasn't we weren't we weren't changing
• 28:24
  the values what we were doing was we're writing them down saying them and then putting them in
• 28:29
  the systems and processes right like those types of things when you're growing just are hitting
• 28:35
  right yeah and now like it's almost like you were like you were you were trying to keep up with
• 28:41
  the growth like you were a venture back but actually you had the luxury of not taking on capital
• 28:45
  so you didn't have investor that we're needing you know x percent growth year over year you actually
• 28:51
  could have killed a little bit which is something that I mean this is like this sort of a whole
• 28:55
  other conversation about taking on the money right yeah really hard like you seek through a
• 29:00
  quarry and you're like I'm not slowing down I'm going faster right which is why maybe at the
• 29:06
  beginning we should have been more conscious and you know intentional about some of these
• 29:10
  foundational activities that we didn't do but we were bridge drafts like I'm okay with how it went
• 29:18
  right like we did things we had to do to get there oh yeah no I think it went listen it went
• 29:24
  fabulous but but all I'm all I'm pointing out is the things that if you did it again
• 29:31
  what are the things that are different and I guess it's really good to be clear on like what are
• 29:34
  those foundational elements that you you're building from scratch right now what do you have to get
• 29:39
  dialed in as like a new entrepreneur so that you don't have to go back and revisit them which just
• 29:45
  takes more mental bandwidth and it just creates stress and anxiety and probably takes some money to
• 29:49
  solve problems that could have been solved much earlier on what are those like core pieces for a
• 29:53
  startup that you'd recommend people actually dial in right away I think that those are one core
• 29:59
  values and core purpose make sure that potential written and integrated right away so
• 30:04
  hiring firing everything that's happening right like this should be public on the website should
• 30:08
  be everywhere because these are coming from you as a founder anyway right so this isn't that much
• 30:13
  work early on it becomes a lot more work later that's the challenge the other pieces start to
• 30:19
  think about where you can be most effective with systems and processes without overburdening
• 30:25
  so I think about this a lot about communications I'm a big believer in the daily weekly monthly
• 30:31
  meeting rhythm huddle whatever you want to call it whatever process there's lots of things you
• 30:35
  can do if it's EOS if it's verna it doesn't really matter but like those things integrated
• 30:42
  earlier are much easier to do than later and give you tremendous upside right so like we think
• 30:48
  about that much earlier like in the very first days how do we do these things now right um
• 30:55
  and then the last piece is thinking about the environment that I want to build right is that all
• 31:00
  remote is that wall in the office and I'm a big believer in one of the two not a hybrid um so like
• 31:06
  what is it that I want to build where I want to be and I think if you can answer that question
• 31:12
  strongly you're in a great path to success but it needs to be intentional
• 31:19
  I you know I was having a conversation yesterday with um with Chris Savage who's the founder of
• 31:25
  of WCS excuse me I was mispronouncing and he was talking about um culture and what it is and what
• 31:31
  it isn't and he actually want to set further and I'm curious uh I'm curious about your view on this
• 31:37
  yes he said that culture actually informs how people within the company deal with problems
• 31:44
  but what culture should also really do is say for example how how somebody on the sales team
• 31:50
  responds to a customer inquiry and I'm curious if you ever found that there was some semblance of
• 31:56
  that in grasshopper any of the other any of your other companies just an example of how like a good
• 32:02
  culture a strong culture can actually um it can actually help somebody make a decision that
• 32:10
  benefits the company so they understand the place where they're operating from versus just
• 32:15
  you know we're we're a great group we're all ethical whatever does that make sense
• 32:19
  yeah so culture is how we do things not what we do right yeah so I think that's a reasonable example
• 32:27
  but let me take you one step further and how we thought about this right so we had a customer
• 32:31
  service group um dealing with hundreds of thousands of customers and there's all of these requests
• 32:37
  for credits and refunds right for all sorts of reasons and we could have done what is typical
• 32:43
  which is you create a playbook that says for this you do this you allow this much dollars to be done
• 32:48
  you know you create all these rules right we didn't do that at all and we said you know what
• 32:53
  you can give any amount of credit or refund you think is reasonable if next to it you select
• 33:00
  from the drop down one of our core values and you write wide matches oh I like that I love that a
• 33:06
  lot okay and so like this was very intentional and specific white we we told like our
• 33:13
  corporate core purpose was empowering entrepreneurs to succeed right we would have a very typical
• 33:19
  thing happen which is hey I sign up for grasshopper I've printed my business card I put the wrong
• 33:25
  phone number on there okay um we add requests for can you get me that phone number obviously we
• 33:32
  tried as best we could can you can't get me that phone number um I want a credit or refund
• 33:38
  for the amount of the printing of the cards wasn't our mistake regularly we would give a refund
• 33:45
  larger than the amount that paid us because our core purpose was empowering our services seat we
• 33:51
  don't want to kill them at the first step right like if you're asking us for a 200 dollar refund
• 33:58
  that must be meaningful to you right at the beginning ages of your company we're not going to
• 34:02
  stand in your way there right and that's a small example but that's that's about how you connect
• 34:08
  the values with the actions that are being taken how we do things compared to creating rules I love
• 34:14
  this um and that's such a good uh it's such a good implementation of of what culture should be
• 34:19
  because I feel like again it's just a word that's discussed a lot and I feel like a lot of business
• 34:24
  really missed the mark on on what it actually is and how it impacts like the day and the life of
• 34:28
  the actual employee um something that I thought was interesting in in sort of your professional
• 34:38
  uh your your professional career um you hired a business coach and you said that was a game
• 34:47
  changing decision for you uh what prompted you to bring that in uh bring in the bring in the
• 34:54
  business coach uh help you with growing the business why was that such a life changing uh change
• 35:00
  for for somebody who's already sort of killing it in their own business I mean that allowed us to
• 35:05
  really create a lot of the things we're discussing today like that's when we specified the core values
• 35:10
  it's when we put in the daily quarterly meetings that's when we created process around all this
• 35:15
  because we made a decision that we couldn't just run around like crazy entrepreneurs anymore
• 35:20
  we had to create something that created a structure where our team could win right shifting from
• 35:27
  having a bunch of doers right like someone who comes to me and says okay David what do I do next
• 35:32
  I say okay go do this come back to me do a bunch of thinkers who say David here's what I'm going to
• 35:38
  do and why and I'm going to come back to you with the results right and doing that is a very
• 35:43
  different set of people and processes and things that have to happen in a company and so we had
• 35:49
  to educate ourselves as entrepreneurs how to do that and a business coach I think is a catalyst
• 35:54
  along that path they don't do it for you but they give that push right and that kind of external
• 36:00
  view and knowledge to make that happen do you feel like that's significantly different person
• 36:06
  than what like a mentor would be like just frame that for the audience because there's a lot of
• 36:10
  business coaches out there there's a lot of mentors a lot of people that sell consulting services I
• 36:14
  think it's a very difficult thing to figure out for somebody who's building who's working non-stop
• 36:21
  they know they need help they don't know who they should actually turn to and it's just a
• 36:25
  mind field of different figures out there that they could choose from that can take their money and
• 36:29
  help them or take their money and not help them so I mean I agree completely but I also think that
• 36:35
  it's just stressful to find the right person how do you do it when you're running at you know
• 36:40
  a million miles a minute you have a thousand things on your plate uh where do you look
• 36:45
  yeah this is a danger zone right like yeah where there's a lot of people out there who
• 36:50
  make a lot of claims and charge a lot of money um the process that I took was I identified the
• 36:56
  framework I wanted to use and I went to the person that built that framework and said I want
• 37:01
  your top coach I don't want anyone else I don't care how much the person cost I don't care
• 37:06
  what the schedule is I want that person that personal right so that for me filtered out a lot of
• 37:12
  the junk right like I wasn't listening to inbound calls I identified something I wanted and
• 37:17
  identified the person I wanted right just like you identify employee right like you you you go
• 37:23
  out and you look for the specific thing you want and need at that time right and the other important
• 37:29
  thing is a mentor and a and a business coach are very different things mentors are not necessarily
• 37:35
  sitting there in the quarterly meeting running process doing this across 10 or 15 different
• 37:41
  companies doing this day in and day out where a coach is and has a framework to use that they've
• 37:47
  proven and done in other places right me um so I think the last really important point is
• 37:54
  you change these people over time just like employees you outgrow the needs of what you need
• 38:02
  from that coach at that time right the company outgrows them where they've been the experiences
• 38:06
  they've had the things that they can implement do you have to change these people I mean that
• 38:12
  that could be said for even like your executive team like there's there's a case to be made for
• 38:18
  the founders good to bring the company to a million or 10 million then you're bringing a CEO and
• 38:22
  that CEO is maybe good to bring the company from 10 million to 50 or 10 million to even a hundred
• 38:27
  and then there's a different CEO for you know post going public so it's always about bringing the
• 38:32
  right people and I think that's probably just a great sort of rule to live by but also with business
• 38:38
  coaches I think it's important that you highlighted the difference between a mentor and a business
• 38:42
  coach because I feel like what a lot of entrepreneurs do is they look for the most impressive person
• 38:48
  on paper regardless or not if this person is functioning as a coach and has frameworks and
• 38:55
  they try and reach out to them and they say hey can I grab a coffee hey can you help me with this
• 38:59
  can you help me with that and I feel like there's a lot of well-meaning people that will sit down
• 39:05
  and help an entrepreneur but I think there's something to be said for like you mentioned somebody
• 39:09
  that does this every single day and somebody that has those frameworks in place as opposed to just
• 39:13
  giving this ad hoc advice that is probably useful but also could be slightly outdated sometimes
• 39:20
  so I think that that's actually a very very important point like if you're going to align with people
• 39:26
  I mean align with the right people and these are people that are sort of like set up
• 39:30
  these are different functions right like not they're not more valuable or less valuable they
• 39:34
  serve different functions and mentor serves a certain function right and you probably do want
• 39:39
  someone that is highly experienced someone who's older maybe someone who has deep industry knowledge
• 39:45
  or connections that that serves a purpose and it's valuable a business coach is likely someone
• 39:50
  who's not know right like the best coaches are not know right like if you think back to sports
• 39:57
  we know some of the coaches names but not many right from a championship team perspective or
• 40:03
  wherever we know the players names because the coaches are there to serve a very valuable function
• 40:09
  but it's not necessarily the other four I just want to take a second and thank the Hubsbot
• 40:14
  podcast network for supporting success story the Hubsbot podcast network has incredible podcasts
• 40:20
  like the product boss hosted by Jacqueline Snyder and Mina Kuhnlo Sithep if you want to take your
• 40:26
  physical product sales and strategy to the next level to create your dream life you need to listen
• 40:32
  to the product boss they sit down for an hour they do a workshop style podcast they're going to
• 40:38
  talk about everything that you need to know to up level yourself social media marketing if you're
• 40:44
  in consumer package goods if you have any sort of physical widget you need to tune into the product
• 40:50
  boss wherever you get your podcasts I'll tell you something even if we know the main coach we
• 40:54
  don't know that we don't know the goalie coach we don't know the the assistant coaches and
• 40:58
  they're all they're all so important to making the team function and they all have incredible
• 41:03
  experience right walk me through the actual exit event so when you were selling grasshopper to
• 41:10
  Citrix did you use an investment banker did you source a deal on your own did Citrix come to you
• 41:18
  what are the lessons of selling a company for that amount of money owns the lessons here but so
• 41:24
  process wise Citrix came to us we did not or we did not want to even sell we had no desire I
• 41:30
  weren't even looking at it right they came to us and it was over a year a year and a half period I
• 41:36
  think roughly and the process was quite simple they came to us and said we want to we're interested
• 41:43
  in this space that was the first call we're like okay cool I have a call about it whatever the
• 41:48
  setting call was we're going to buy something in this space okay it's interesting um our response
• 41:53
  was very simply look guys we have a plan we we we do our quarterly planning we know what we're
• 41:58
  gonna do um we're gonna deliver on that plan and we're excited about that we're not interested
• 42:03
  right um they came back to us you know call that two quarters later and said okay guys how are
• 42:09
  things going they said well we out delivered our plan and where things are going great they're like
• 42:13
  holy shit we've made 80 plus acquisitions and no one is ever in that process delivered on the plan
• 42:19
  they told us they were gonna deliver on we were like yeah but that's because we're not we don't
• 42:24
  care about selling like we're we're building a company to be here and we're building a management
• 42:29
  team and all those things um so that's how it then progressed right the end story there is
• 42:37
  we did hire an investment bank to run the Citrix process not a process like we didn't have
• 42:43
  competitive bids we didn't do any of that but we had an investment bank a very specific focus
• 42:50
  of just running through the best practices to get the deal closed and maximize value right because
• 42:58
  any negotiations there's always this they want to push value down you want to push value up
• 43:02
  meeting somewhere in the middle we closed at the original offer so that's good result um
• 43:09
  we decreased escrow we did all the things we needed to do by having a partner in that process
• 43:14
  but happy to talk about the learnings too well no i i am very curious because there's there's
• 43:19
  something to be said for um for doing a deal that looks good on paper and looks good in the press
• 43:24
  release whatever but there's a lot of nuances to how you do a good deal so that it benefits you
• 43:29
  and it could be a mixture of a variety of different things so i'm curious as to what kind of deal
• 43:34
  outside of the dollar value you negotiated what are some of the things that founders should think
• 43:39
  about that they don't normally think about you had you know you had the the aid of an investment
• 43:44
  banking team that probably does this for a living so they really probably highlighted and
• 43:49
  acted in your best interests the things you should care about what are some of those things that
• 43:53
  founders really don't even realize when they're looking to sell yeah so we always hear about the
• 43:57
  top line dollar number right yeah but but then let's take that step down like escrow matters a lot
• 44:02
  the size of it the length of it all of those things right like so when you have a deal how much
• 44:09
  is held back what are the terms of that you know even to the detail level of like is it a tipping
• 44:14
  basket escrow or not and how are claims done all of those things matter a lot but the most critical
• 44:20
  thing is what's the percentage right is it 1% 5% 50% 10% right like generally you want to be around
• 44:26
  10% in a deal or less we had some specific carveouts for federal taxes and telecom related things
• 44:36
  but like that was an important factor another important factor for us was is Citrix going to keep
• 44:42
  the brand right that doesn't get talked about at all right expect if else externally internally
• 44:49
  this was our second most important thing after dollars and probably honestly we wouldn't even
• 44:55
  have entertained the dollars it this was not an item this is this was a go or not but what why was
• 44:59
  that why was that so important to you to keep the brand because we had invested 12 years of our
• 45:04
  life building this brand and we didn't just want to be able to eat up into a Citrix product with
• 45:09
  that that like was it worrying that if they just destroyed the brand like it could impact like like
• 45:15
  they would like get rid of the people or like what was the thought well customers all of those
• 45:20
  things like so the next layer down right obviously is that the people how are they
• 45:24
  compensated in the deal structure but also going forward are they keeping them or not like we
• 45:29
  negotiated to make sure every person was kept and very high retention bonuses and all sorts of
• 45:35
  things to pay them out even more outside of the deal structure we also did not have a lot of
• 45:41
  external equity holders company so we carved out even more money to give in the deal to employees
• 45:49
  so they allowed us to do that there's then all sorts of terms in the APA that matter
• 45:57
  as a purchase agreement that matter and are never discussed right and my key learning here was
• 46:04
  make sure you have a warrior that understands these deals fully because a typical warrior without
• 46:12
  experience negotiates every deal point and very quickly what happens is they lose all ability to
• 46:19
  negotiate because the other side is like you know what I'm done yeah I'm on the other side of
• 46:24
  this and as a buyer I'm like this is what it gets guys yeah like now you missed all the important
• 46:30
  stuff that were later on in the document and I'm not willing to even talk about it anyway right
• 46:35
  like not even negotiate I just want to talk about it I'm like guys that's it so making sure
• 46:41
  this warrior understands the important pieces and uses their negotiating capital appropriately
• 46:47
  it's very interesting I I've been through several of those kinds of transactions before where
• 46:53
  it's just the entire things redlined and the buyer is not interested it's just like listen guys
• 46:59
  like this is I don't I don't have the the mental bandwidth to go through all this and to to you
• 47:05
  know nitpick this word that word for an entire document for things that are relatively
• 47:11
  they're not material and they're not going to affect the transaction at any significant degree but
• 47:15
  I've seen it happen before it's actually very interesting me brought that up I don't think I've
• 47:19
  ever heard anybody note that it's actually very very important because I think that most people
• 47:22
  actually believe that if their lawyer does more work it's like the the hallmark and the and the
• 47:27
  calling heart of a good lawyer to overanalyze but without thinking that oh well this person is
• 47:33
  protecting me but it's actually like they could be killing the deal completely very very interesting
• 47:38
  you've seen it many times right like the best lawyers understand when to negotiate when not to
• 47:44
  at least a work amount of possible right like their goal in this type of a lawyer in transaction
• 47:50
  is to close the transaction right like that's it obviously there's things they want to protect
• 47:54
  and all the other things but their paramount goal is a business goal not a lawyer in goal
• 48:00
  and I think a lot of junior lawyers forget that they're like I went to school I know better
• 48:05
  he or she I whatever none of that so after you after you did you stay on after you sold
• 48:12
  were you required to say it's an interesting point too right so yeah
• 48:16
  hitchurch said you built a management team that is that can run this company without you
• 48:21
  we can either find you a high paid title position for no reason or we can pay you more money now
• 48:27
  and not suck it out of the deal and negotiate you down and that's right it like well we'll take
• 48:31
  the cash it's fine this emotionally was very difficult but with the right age of economy yeah
• 48:37
  definitely and you've never you know it's so interesting I've seen this happen a few times where
• 48:42
  there's there's a non-compete for a period of time and then somebody will try and just go and build
• 48:47
  something again after that non-compete expires but you just stepped back from the whole industry
• 48:51
  you said I'm never going to build anything like to sever again you know nice nice check comes in
• 48:56
  and and then that's where you turn from operator into investor I'm assuming really think about
• 49:01
  this for a second like we were building this because we loved phones and telecom right true we
• 49:08
  were building this because our core purpose was empowering entrepreneurs to succeed right like
• 49:13
  that's what got us up in the morning got us excited nothing to do with falls right it's gonna be
• 49:18
  what we were doing I love that and then you you've got a way to do that in another capacity really
• 49:23
  so when you start going so when you switch when you switch when you switch gears when you switch
• 49:28
  from operator to capital allocator obviously I'm sure you've made a few mistakes and lost a little
• 49:34
  bit or maybe a lot of money with some bad deals but what do you start to go into what's the first
• 49:39
  thing because I think now you do a lot of SaaS companies um talk to me about even you know your
• 49:43
  investment strategy how it's matured over the past I don't even know how many years um you started
• 49:51
  in VC did you go into private equity get some cash flowing stuff you did that as well I'm assuming
• 49:56
  but where do you where did you start where do you end up yeah I mean I do a lot of angel investments
• 50:01
  that's the easiest thing to do right I worked for VC accelerator for recorders to see if I like
• 50:10
  that I didn't like it at all so I moved on pretty quickly but think about like the angel portfolio
• 50:16
  I probably have I don't know 75 investments in there um the portfolio as a whole is probably
• 50:22
  around breakeven or better um but very quickly I identified that I was not a great capital allocator
• 50:29
  at the early stage so the only reason I make investments anymore at the early stage is if I
• 50:36
  want to learn something where I want to give back to a founder or something like that I'm not
• 50:41
  looking at it from a recharge perspective um I also make very few of those investments like I
• 50:46
  only invest pretty much in companies that have product more I could fit over a million dollars
• 50:51
  that they are revenue um breakeven are profitable right like that's where I like to play and
• 50:57
  and can contribute um but I'm also very focused on learning like is it an industry or space I want
• 51:03
  to learn about that's the return compared to dollars I'm actually I'm very curious because even
• 51:09
  like for researching for this podcast I heard you say something that was interesting to me and you
• 51:13
  said at one point in your investing career you were looking for founders that were almost hired
• 51:18
  over their company so I think that and I think it was in 2019 or something like that you said that
• 51:23
  on a podcast you were looking for founders that had built something but they were looking to get
• 51:26
  out more or less um is that is that change that all is that a thesis that you still operate by in
• 51:33
  terms of like a strategic investment strategy is there a reason for that in particular yeah so that
• 51:38
  that is very specific to companies that we buy right so okay that that's not an investment thesis
• 51:44
  but uh but a buying thesis right you got so yeah come come tired founders who are done with it
• 51:51
  and have hit that plateau I think is the very unique opportunity to be able to buy a company that
• 51:57
  has upside value but also get a founder out when they want to get out rather than trying to convince
• 52:02
  someone at some other important time right so I think it's a very unique scenario that that's more
• 52:07
  that's more in line with like a traditional private equity play where there is yeah there's
• 52:11
  some historic there's some history behind it and and the founders trying to get out um when you so
• 52:16
  you said you look at companies mostly SaaS um what are some other things that you've tried to invest
• 52:21
  in that haven't worked out so well I mean I have a ton of friends who have had exits and they've
• 52:26
  messed around with different industries different vertical I guess at the end of the day you kind of
• 52:29
  go back to what you know which is just a smart thing to do as an investor um what are some lessons
• 52:34
  things that you should you know not go into I mean I've wasted so much time and money in different
• 52:39
  places I you mentioned that I invested in a restaurant that was a tremendous loss um millions of
• 52:45
  dollars uh you know I yeah everyone always says don't do it don't do it you're like oh this
• 52:50
  isn't gonna be different it's just yeah but but I think that the the draw to that is very
• 52:56
  interesting and unique from a learnings perspective the reason I think me and other people do
• 53:02
  this is because it's something you can point to right like I came from software and my kids
• 53:08
  they really understand like what is this thing I don't understand we really does people like well
• 53:12
  he just runs grass out brown really know what it is but you're like oh I understand a restaurant I
• 53:16
  eat food oh I like that's it how we people can identify and I think that's I make these
• 53:22
  poor investments um but yeah I've I've lost money all sorts of places but also
• 53:29
  interestingly learn things I don't like like I made money developing real estate in Las Vegas
• 53:36
  I didn't do it like I could have made more easy money doing it it just wasn't fun or interesting
• 53:42
  so I didn't do it I love it um I want to I want to switch gears a little bit um and I want to
• 53:50
  just sort of unpack we sort of we sort of went that we went into this at the beginning uh we were
• 53:55
  just speaking about your health your wellness and I do want to speak about some of the things that
• 54:00
  you've incorporated into your own life because you are very much in this biohacking human optimization
• 54:07
  mindset and I think that it's it's a very important thing for entrepreneurs to understand but I want to
• 54:14
  just sort of go into like you know your health and wellness and optimization routine you mentioned
• 54:19
  that you're so so um so strict about it and it's very important to you to sort of keep everything
• 54:24
  in line so what are the things like what's the morning routine what's the health and wellness
• 54:28
  routine what's the diet what what are the the things that you've incorporated into your life that
• 54:33
  you feel actually make an impact because there's so much out there and I find that it's hard to
• 54:38
  figure out okay listen I have the the blue light glasses and the cold plunge and the keto and the
• 54:43
  this and the that and I I heard you speaking about um like gut biome test and biome and I and all
• 54:49
  these different things that you can do so after the the testing on yourself where did you land
• 54:56
  what actually works what doesn't what do you incorporate what do you you know you say people should
• 55:00
  check this out or not okay I think the most important thing is it doesn't really matter what
• 55:04
  works to me it matters what works for you right I think that's the the key and it's finding those
• 55:09
  things right so like I can tell you the stuff that works for me I eat a ketogenic diet but I also
• 55:13
  tried every diet possible I did vegan I did low carb high carb I did all protein I did carnivore I
• 55:20
  did all these different things right to find what worked for me and I I was optimizing for energy
• 55:26
  and feeling right like how am I energized how do I feel right am I bloated not bloated like those
• 55:31
  types of things if you think about that you've had to find those right things the similarly for
• 55:37
  sleep like I can give a bunch of advice for like what I think is best for sleep and that's generally
• 55:43
  go to bed between 930 and 1030 wake up naturally with a no alarm clock um don't eat within two or
• 55:50
  three hours of bedtime right like generally those things are right um can I tell you like for me I
• 55:56
  love my cooling mattress I think it's fantastic I come up with all sorts of settings that work for me
• 56:02
  that doesn't work for everyone right I take magnesium but I also tested 22 other things right
• 56:07
  like all of those things are true so I think if you look at all of those categories
• 56:13
  it matters finding what works for you the individual to opt as many as wherever it is I'm curious
• 56:19
  when you when you when you when you take on a diet like a keto diet um obviously it you know it
• 56:27
  does impact your your your body fat your uh your your your your mental ability your clarity it
• 56:32
  impacts your energy levels but do you find that sometimes when you optimize or something like that
• 56:38
  like other parts of your life degree like I've I'm speaking from personal experience I've tried
• 56:42
  keto before and I find it very hard to maintain in the social environment I find it just incredibly
• 56:47
  hard and awkward and uncomfortable and I'm curious how you balance that are you full keto are you
• 56:53
  full into this whenever you go out yeah I am I also don't drink anymore um certainly I'm happy
• 57:00
  to balance those things socially but I actually found it a benefit like the early days it was hard
• 57:05
  right like okay how do I find something to eat but what I flipped the strip on and said you know
• 57:10
  what I really actually now enjoy going out to a meal and not being focused on the food like I don't
• 57:17
  care what's on the menu I don't care what gets ordered I can actually engage and have conversations
• 57:22
  with the people at the table and not be focused on what I'm ordering or eating or whatever like
• 57:27
  I'll just eat nothing at the dinner like it makes no difference to me right and that's been very
• 57:31
  freeing um similarly with alcohol like I feel better not drinking so I just don't care right
• 57:38
  very simple do I have to have the conversations why or whatever sure or I just say I'm not drinking
• 57:43
  today yeah that's fair the easiest thing to answer no one cares or is interested or whatever
• 57:50
  and if it's a group that I know is not gonna be interested in the reason I say that if it's
• 57:55
  someone I'm gonna engage with you know I'm a deeper conversation but you know what I think that most
• 58:00
  most entrepreneurs now are actually more focused on this on how to optimize themselves I mean like
• 58:05
  longevity biohacking like this is very top of mind for a lot of people and and again it's sort of
• 58:11
  like business coaches there's a lot of uh health and wellness charlatans as well and they all have
• 58:17
  a different opinion and I feel like religion is almost as sorry how the wellness is almost bad
• 58:21
  as religion and politics when it comes to people being these zealots of what they believe in
• 58:26
  so I also think it's very important to just test out what works for you I mean I think that that's
• 58:32
  the best advice possible because I know that there's just so much out there um but I do believe that
• 58:38
  you can easily be led astray and I also am a big believer in you don't have to have the perfect
• 58:44
  routine to be successful either I mean it helps it's a bit help but at the end of the day it's really
• 58:50
  like what what can you actually maintain for a long period of time that's what will really impact
• 58:55
  your life and yeah exactly like like keto I know for a fact that keto is not just about weight
• 59:01
  loss with you it's about I feel energized I don't have like a 4 p.m. you know like uh dip in energy
• 59:08
  I you know feel alert I'm I'm actually curious do you feel like you can get by with less sleep too
• 59:14
  once in a while um yeah I mean I don't really think about how much sleep I get a measure with like
• 59:19
  my horror ring and stuff yeah yeah and you find you get a better a good sleep score with uh with
• 59:25
  no carbs interesting yeah but I don't need no carbs right so like I eat a pretty modified like I
• 59:30
  eat very low-car right a lot of fruits and vegetables actually right so like my dessert is whole
• 59:37
  fruits not a lot of them I eat a lot of vegetables um I think it's a pretty bad idea generally
• 59:44
  to eat no vegetables and eat super low-carb I cut out the things that it don't make me feel good
• 59:52
  processed cards yeah lower things like that I'll eat raspberries tonight no problem I don't care
• 1:00:00
  yeah I guess that that that's true like there is there is some stuff that you can you can add
• 1:00:04
  into a keto diet it's not like a carnivore diet which is like a another level of extreme um
• 1:00:09
  but true whatever whatever helps your performance I mean I think that people just have to be
• 1:00:13
  cognizant of it and and attempt to at least look at the food they're eating um you know you
• 1:00:18
  even mentioned uh you've done these like gut biome things yeah it's a topic like yeah I think
• 1:00:24
  what's most important like you pick any diet you want doesn't really matter the most important
• 1:00:28
  thing is your stop eating sugar right like yeah we're not stop but like reduce it as far as
• 1:00:34
  possible I'm not saying don't have desserts if you like desserts but like generally I don't care
• 1:00:39
  what diet you pick just have less sugar and you're probably 80% of the weighter you're not wrong
• 1:00:45
  I think that's probably one of the most toxic things you put in your body I haven't killed alcohol
• 1:00:49
  completely but I also I think as you you know as you go through life you start to realize that
• 1:00:54
  it's not a net benefit to most things you do and you like and you know you get older you start to
• 1:00:59
  lose days to alcohol with the hangover and whatnot so you just feel like whatever and also if you
• 1:01:04
  don't have that if you don't have that social anxiety then it's perfect and if you do have social
• 1:01:08
  anxiety that is a skill that you can actually work on so I think that that's something that you
• 1:01:11
  should actually incorporate as well I haven't gotten rid of caffeine I don't know if you've done that
• 1:01:16
  but I'm a natural introvert so like social settings are hard for me especially in
• 1:01:23
  groups so alcohol used to be a lubricant I found other ways to deal with that and exercise that
• 1:01:29
  muscle to replace that which I think is healthier in the long run right so what do you do that's very
• 1:01:34
  that's that's very let's let's speak about that quickly because I think that's the one reason
• 1:01:38
  why people do drink yeah so I hate large groups right like if I'm picking a social setting I want
• 1:01:45
  kind of five or less people so large groups is very challenging to me I don't like groups of
• 1:01:51
  new people so like natural introvert but I can be extroverted it's just a muscle that I have to
• 1:01:57
  practice on and be very conscious of it and no I'm walking into this situation I need to change
• 1:02:05
  this and do this right the way I force that muscle to work is I volunteer in organizations like
• 1:02:12
  EO and wide pO now and put myself in a leadership position where I have to talk to people right now I
• 1:02:20
  have to walk into a room of a hundred people and I have no option right like I can't go play on my
• 1:02:26
  phone I can't go do something else I can't not go to the event so like putting myself forcefully
• 1:02:31
  in that position where there's zero option makes that muscle you know kind of be exercise I love
• 1:02:38
  that and you don't get I mean being a natural introvert when you first started doing that had you
• 1:02:44
  overcome that initial panic because I think that that's also a great skill to to practice is putting
• 1:02:48
  yourself in front of audiences I've never equated that to a social setting but you know like come
• 1:02:53
  to think of it if you can talk in front of an audience I guess you can talk in front of a group
• 1:02:56
  people at a party um but you never had like a panic attack running like that when you're putting
• 1:03:00
  yourself out there because I know that like I mean I had been a turtle of panic attack every time
• 1:03:04
  I'm in one of those settings but but you've learned to manage it to a degree yeah I had to
• 1:03:10
  confront it right if you like okay I know why I'm feeling this way it's okay I know how I'm
• 1:03:15
  going to manage through it I actually have no problems speaking in front of a large group of
• 1:03:19
  people on a stage that doesn't bother me at all um but in a social setting that bothers me right and
• 1:03:25
  that's what I'm gonna say with it right like I accept it and I say that's fine I understand the
• 1:03:30
  feeling I'm gonna accept the feeling and I'm gonna use the tools I've developed over time to get
• 1:03:34
  through it it doesn't mean that it's easy it's actually very difficult right like if I'm not in
• 1:03:40
  that we're setting it's really hard right you know what I love I'm happy that we just sort of
• 1:03:46
  started going down this path because I feel like I feel like the average entrepreneur uh especially
• 1:03:52
  when they're starting out they do not think that a lot of their personality can be molded and built
• 1:03:57
  upon I feel like they just go through life especially again very very young entrepreneurs and they
• 1:04:03
  feel like okay this is how I am and I have to play within the confines of what my personality is
• 1:04:08
  and if I'm not somebody who feels that they can put themselves in front of large groups I'm not
• 1:04:12
  gonna be the evangelistic CEO and that's just not my role I'm a tech person I'm a product person
• 1:04:19
  but I actually love how you force yourself to go into these really really uncomfortable situations
• 1:04:24
  and then from the outside looking in you do look like the evangelistic being able to put on a show
• 1:04:31
  and for an audience I've seen some of your talks where you're you know running up and down the
• 1:04:35
  stage getting people to do standing ovation to get the energy up in the room like you do it very
• 1:04:40
  well so this is definitely it's something that can that you can learn and you can practice and you
• 1:04:45
  can you can refine and then it becomes this this tool in your arsenal that's just it makes you
• 1:04:50
  more powerful and and effective individual it should be pressed yeah this skill like any other
• 1:04:57
  right yeah and but I think what people need to understand is like I think everyone who does those
• 1:05:03
  things no matter what it is has some level of on comfort right and now we're just talking about
• 1:05:09
  the level of on comfort is it high or is it medium or is it low but there's never zero comfort right
• 1:05:16
  so across all of those things we have different levels of how uncomfortable we are and we just have
• 1:05:21
  to push through those and we all can do all of the pieces right as long as we're willing to accept
• 1:05:27
  it like one of my core values as a person is life begins at the edge right so I'm willing to accept
• 1:05:34
  that uncomfortability is okay and it is good right like that's how we grow how we get better so I've
• 1:05:40
  accepted that in my life you are with tons of founders now do you feel like the individuals that
• 1:05:47
  have the highest chance of being successful are individuals that think the same way as you regarding
• 1:05:53
  uncomfort and putting themselves out there and sort of refining their skill sets you feel like
• 1:05:57
  that's like a necessity to be a success I think it's a necessity to be willing to learn and grow
• 1:06:04
  how you get there I think is less important right for me I thrive in the uncomfortability I think
• 1:06:10
  there are a lot of people who think about this now there's been a number of books written about it
• 1:06:15
  that this is a reasonable way to do it I don't think it's the only way but I do think that the best
• 1:06:20
  founders the best business owners are people that are willing to learn and grow and have conversations
• 1:06:26
  like maybe the company's outgrown me maybe I've outgrown the company but either way like I'm
• 1:06:31
  pushing forward those are the most successful and when you look at when you look at again just
• 1:06:38
  because you have a huge sample size to to sort of get insight and data from the the founders that
• 1:06:45
  you invest in they've they've all you know they've all passed like the one million dollar threshold
• 1:06:52
  um what are some of the what are some of the biggest mistakes they're still making at the one
• 1:06:59
  million dollar mark so at the one million dollar mark I think it's still a lot of
• 1:07:05
  questioning marketing channels and not being willing to try other things and then double
• 1:07:10
  down on where it's working right like I think there's a lot of talk about like always trying
• 1:07:14
  the new channels and it's a balancing act right like there should be there's a bunch of stuff
• 1:07:19
  you're testing to find new channels but there should also be like this channel's working I am going
• 1:07:25
  to double triple and quadruple down and just keep banging at it right and I think people fall into
• 1:07:30
  the trap of like well I need organic things I need free marketing I need influencers like no no
• 1:07:35
  like very simply if you've got to that product market fit you should be finding and identifying
• 1:07:41
  channels that you can put a dollar in and get two dollars out or five dollars out and whatever
• 1:07:47
  and creating that money machine right like that's how you get exponential growth is finding those
• 1:07:53
  channels right do you feel glad sorry I think that people fall into the trap of this influencer
• 1:08:00
  free market and that works for some companies right like think back to the 37 signals and and
• 1:08:06
  base camp that worked them it is almost an unrepeatable process and set of practices right like
• 1:08:14
  everyone tried it right and we saw it didn't work right but everyone is tried google ad words
• 1:08:21
  and as soon as you find it's working it works right yeah I mean but but that's that's I mean
• 1:08:26
  so I'm actually curious because you know you you spoke about product market fit I would even argue
• 1:08:31
  that a company that has hit a million dollars could have just hustled their way to a million
• 1:08:35
  dollars so it doesn't necessarily mean they have product market fit at one million just because
• 1:08:40
  they're hitting that threshold by any means or they have a bit of it but it's not like
• 1:08:46
  it's not like they could turn it into a you know a hundred million dollar plus company just because
• 1:08:50
  they can hit the one million I am curious about what you look for in in true product market fit
• 1:08:57
  what is the signal what is the leading indicator is it the one marketing channel that is converting
• 1:09:03
  at you know you make two dollars for every one dollar spent like what is yours an investor
• 1:09:09
  the the thing that you need to see before you you have the confidence to put money into them
• 1:09:13
  there's not just a million bucks in annual revenue somebody can somebody can just hustle there
• 1:09:18
  a million dollars is like a rough proxy product market fit it is rough like to your point it's
• 1:09:23
  not perfect I think it's you you have to have at least one channel that's a machine right now
• 1:09:29
  you might not have enough money to put it into the machine but like you've proven that same machine
• 1:09:32
  that is doable at least one other channel you think could be a machine and then I look for what
• 1:09:39
  is the referral amount happening in within the company right like word of mouth not any other channel
• 1:09:46
  but like word of mouth are customers telling their peers about this same also includes enterprise
• 1:09:52
  software right like I think we ignored a lot of times an enterprise software it's not just consumer
• 1:09:57
  but really the best companies all have this they all had referrals happening within the companies
• 1:10:05
  and they had word of mouth as a big channel I don't know if they the exact percentage but it's big
• 1:10:11
  when you try and measure that is that something as simple as with somebody checking out you're
• 1:10:14
  asking where you heard about it or is there a more effective way to actually measure word of mouth
• 1:10:19
  I think that's a great great benchmark for product market fit it's if if someone's telling their
• 1:10:25
  friends about you awesome but I mean if it's enterprise yes but enterprise B2B the sales cycle
• 1:10:33
  the sales process is so convoluted how are you actually going to find out if that next customer
• 1:10:39
  came from a referral yeah so first of all I think a lot of enterprise sales is convoluted for no
• 1:10:44
  reason the first problem but then we get into kind of how do you do attribution and all the big
• 1:10:51
  believer in the most simple attribution models not complex software not fails very simply how do you
• 1:10:57
  hear about a drop down you pick it right like that's it there's nothing else and that includes enterprise
• 1:11:03
  software you can include that on the contract form you can include that on the intake you can do it
• 1:11:07
  all sorts of places but it's very simply a drop down of those things and what's interesting is people
• 1:11:13
  always say that doesn't work you know whatever and yes there were problems right like we never ran a
• 1:11:19
  television ad but we had television in the drop down and people selected it okay so maybe they
• 1:11:24
  thought they heard it on TV right but what only what matters is that the percentages and how those
• 1:11:31
  percentages change over time and then looking at for consumer product at the DMAs right like if I'm
• 1:11:36
  running ads and DMA one is my percentage of radio going up in the how did you hear about us in
• 1:11:44
  that DMA that's what matters nothing else right all right let's let's wrap this up we've gone through
• 1:11:50
  pretty much everything that I wanted to to pick your brain about so let's uh I I guess I'll ask you
• 1:11:57
  is there anything that you wanted to to leave the audience with an entrepreneur that's building
• 1:12:02
  something some last words of wisdom or if there's something that we didn't go into we can go into
• 1:12:05
  that too but I think we did everything we talked about grasshopper we talked about selling we talked
• 1:12:10
  about just some entrepreneurial stuff investing stuff health the wellness I mean what other
• 1:12:14
  shit do you do what what I don't know Jake built a large formula one event for YPO here in Las Vegas
• 1:12:22
  oh for real well that's awesome but I would say like the the one thing I would be people with is
• 1:12:30
  an interesting metric that I found that is a good predictor for success within startups and it
• 1:12:36
  doesn't necessarily make sense but across a large sample set this has been the case the founders
• 1:12:42
  that send regular email updates about the company are more successful than those that don't like
• 1:12:48
  very simply it doesn't even matter what's in the update it doesn't even really matter the cadence
• 1:12:53
  as long as it's more than once a year like if it's quarterly if it's monthly if it's a mix
• 1:12:59
  but like a regular cadence to destruct to and a regular set of things that are reported
• 1:13:04
  those founders are more successful what do you think that is I think it comes back to process
• 1:13:11
  and you know structured thought right like they're willing to think about things in a structured
• 1:13:16
  way so they're probably not fridantically running around doing crazy things they're structuring their
• 1:13:22
  time their processes their thoughts all of those things yeah it comes across as this email update I
• 1:13:28
  love that and it also gives you insight as to what they're working on so you can probably provide
• 1:13:32
  more support if if you see something that can actually be the you know but not the best founders
• 1:13:39
  include a section at the end that says like ask like very yes this week or this month or this
• 1:13:44
  quarter my ask is this if you can help let me know you know it's so funny it's such a simple
• 1:13:49
  thing that a founder should be okay with it's specifically taking money from somebody but like
• 1:13:53
  why wouldn't you ask for help it seems like it seems like silly to not ask for help but I guess
• 1:13:59
  people they get in their own head about I need to I need to solve all the problems and if somebody
• 1:14:05
  trusting me with their money they're trusting me to have all the answers which is so not the reality
• 1:14:11
  but I think some founders think that and they don't ask for help and then then the money's gone
• 1:14:16
  so I think if humans were bad at asking for help yeah can I agree people agree
• 1:14:22
  where should people go and connect with you where do you want to send people now what do you
• 1:14:28
  what do you where do you want to push people you have a website social
• 1:14:34
  any links you want to drop and also what are you personally like working on in the future
• 1:14:39
  that people can be excited about yeah so davidhouser.com H-A-U-S-E-R
• 1:14:45
  sure we can put in the show notes or whatever else I have a weekly email that I send out kind of
• 1:14:50
  talking about all these topics a few topics each week kind of what I'm thinking about reading doing
• 1:14:57
  have about 15,000 people that are now subscribed to that I really love that like that's one of
• 1:15:02
  the things I'm most focused on on a weekly basis is kind of you know obviously I do a lot of
• 1:15:07
  research and thinking but just filling that down is a really fun activity for me and I've
• 1:15:13
  loved it over the past I think four or five be sure as I've done it now from what am I doing next
• 1:15:19
  perspective I'm not sure I'm in this stage right now with thinking about that we just exited a few
• 1:15:24
  assets and starting to kind of clean things up a little bit to have some focused thinking time
• 1:15:28
  about what I spend my time on now and I'm not sure yet I have to be honest well I guess subscribe to
• 1:15:36
  the newsletter and they'll find out I by the way I absolutely love writing it is the it is the
• 1:15:43
  most relaxing practice and it just clarifies your thinking and it organizes everything in your brain
• 1:15:48
  it's by far one of the the the best ways to just decompress I think for people that are always
• 1:15:54
  on the go and have so many different things on the on their plate um I for that yeah it's actually
• 1:16:00
  become a I become a better shareer because of it like as a human being like in all parts of my life
• 1:16:06
  because I'm willing to think about what I actually think as an opinion and not just consuming other
• 1:16:11
  people's opinions uh and be critical but also be able to share and be able to share in a way that
• 1:16:17
  is open and honest with people and bring people in uh rather than a you know kind of
• 1:16:23
  abrasive weight sharing and that I think that I think it's a beautiful format because when you're
• 1:16:30
  when you're just discussing ideas in a room um again not everybody will put their hand up and say
• 1:16:36
  I disagree with you and also in the moment you don't actually have a ton of time to do the
• 1:16:41
  research usually you're just leading on you know you're you're learned experiences which include
• 1:16:46
  tons of biases in in the information you're bringing to the table like in that very moment but when
• 1:16:51
  you write two things happen you're allowed to research conflicting perspectives and points of
• 1:16:57
  views and then also I mean you can tell if your communication resonates with people because they'll
• 1:17:04
  either subscribe and interact or not there's no need for them to engage with your material there's
• 1:17:10
  no need for them to engage with basically your brain if they don't need to like they may feel they
• 1:17:15
  are forced to if you're in a boardroom with somebody who you've invested in or uh co-worker or
• 1:17:20
  appear so it really creates this arena that forces you to think critically and to present ideas
• 1:17:26
  and learn how to communicate your thoughts in a way that I don't think I don't think there's any other
• 1:17:32
  arena like it even this even this type of format like we we're coming to the table with what we
• 1:17:37
  already know we're discussing what we already know we're not researching we're not we're not
• 1:17:41
  bringing in outside information in this particular hour hour and a half segment so it's a really
• 1:17:45
  great way to just for somebody who values how they think and how they communicate I love it and I
• 1:17:51
  think that I think you're totally on your your your points are a hundred percent correct two
• 1:17:56
  questions to wrap this up you've had an incredible career I would ask you if you had to tell your
• 1:18:02
  20 year old self one thing what would that be uh so I'll go back to one of my other core values as a
• 1:18:09
  person um the journey matters right like I I really don't like looking back and saying change this
• 1:18:16
  do that do whatever like all the things that happen happen for a reason all the hard things all the
• 1:18:21
  great things all the bad things like all of that matters and that makes me who I am today so I would
• 1:18:27
  really tell myself like the journey matters um and then be okay with that uncomfortable parts of
• 1:18:33
  life like if I was okay with that as a younger person I'm sure I would have done better right like
• 1:18:40
  I just would have but I ran away from on comfort right I ran away from social settings I ran
• 1:18:45
  away from this uh and filled it with something else so you know it's it's it's hard but for you looking
• 1:18:52
  back if you you know you look at what you've built you look at um the professional successes um also you
• 1:19:00
  built an incredible family so personal successes as well uh at this point in your life what a
• 1:19:06
  success really mean for you success for me is all related to happiness now right like I I no longer
• 1:19:12
  look at you know return on capital I look at happiness like what are the things that I'm doing that
• 1:19:18
  are going to make me most happy um what are the things are the people around me are going to be
• 1:19:22
  most happy right like those or that's what I value and how I how to judge my success now um like I
• 1:19:31
  don't need more money I don't I didn't change my life after the Exeter Grasshopper like I don't
• 1:19:35
  really care about things other personal core value experience over things right so like none of
• 1:19:41
  that really matters but as an entrepreneur I still love the measuring stick of of capital and dollars
• 1:19:49
  right like because that is how you measure success in this world right that's not what I'm optimizing
• 1:19:55
  but yeah do I want to have a billion dollar exit or whatever sure because that only is measuring
• 1:20:01
  contribution to some extent and I don't know another way to measure that but the dollars itself
• 1:20:07
  don't matter right it's the measuring that matters