EP37 | Raising Capital vs. Raising a Business: Know the Difference with Adam Spector

Hey everybody, welcome back to another episode of the Growth Capital Podcast. I'm your host, Justin Dixon, and today we've got Adam Spector on the podcast. He is the current founder and CEO of Chore. They are an outsourced kind of business operations and business support company specifically focused on working with small businesses and startups. This is a pretty interesting podcast kind of through and through. Adam is also a 3 other times CEO founder. So we talk about some of the business successes, one of the failures, maybe the pros and cons of raising money versus bootstrapping. And then we go down a little bit of an AI doomsday potential. What does 10 years from now look like near the end of the podcast? So it's a little bit of a longer one, but I think you'll get a lot out of it. So let's get Adam on the pod. Interested in hearing conversations with private equity leaders, CEOs of private equity-backed companies, and startup entrepreneurs where they share their stories about their career journeys, If you're interested in starting, investing in, and scaling successful businesses, and the important role that having the right talent plays in building a successful business, then you are in the right place. Welcome back to another episode of the Growth Capital Podcast. Here's your host, Justin Dixon. All right, Adam, welcome to the podcast. Thanks for being on.

Justin, it is a pleasure to be here.

Awesome. Well, let's jump in and maybe give everybody a little bit of an overview of who you are, where you are, and kind of what you're up to right now.

Yeah, sure. The sexy or not sexy part of all that. I'm a 4-time founder, had a failure, an exit, and then one of them is still running. And then the other one I'm running right now as the CEO and founder of a company called Shore. We do essentially back office operations. For startups and frankly every SMB. The idea being is pretty simple. Founder time is really precious, right? When you start a company, you're passionate about something and then suddenly there's all this other stuff you have to waste your time on. And it is insane to go waste your time on all the other stuff such as like HR, finance, compliance, equity. Just hand it off to experts so you can get back to doing what you love to do most. So that's what I do on a day-to-day basis. I am privileged in the sense that I've also been able to do over 200 investments. now in a ton of different types of startups, really over the past 14 years. Is that about right now? Yeah, 14 years at this point. And frankly, a very good, better than 99% of VCs' track record on those investments. So a ton of starting at, starting at the seed stage all the way through to unicorn status and some great exits as well.

Awesome. Well, yeah, I was looking at your background and definitely want to unpack a lot of that stuff. But I guess give a little bit, I'm always curious about somebody's origin story. So you're, you're a 4-time founder. You've had, you know, one good exit, one failure, one still running, and you've got Chor now that you're running currently. I guess talk to me about like the early days of Adam. How did you think about being an entrepreneur? Was it something you always knew you were going to do? Like maybe, maybe what was life like before founder land?

Yeah, no, I didn't, I didn't know I was always going to be an entrepreneur. I mean, my, my mom's an artist, my dad's a lawyer, So, you know, in that sense, no entrepreneurs, although my grandfather was an entrepreneur. He actually started a paint company that he sold it before it got really big, but it ended up becoming one of the largest paint companies in the East Coast, and he sold it really early on. But he was always an entrepreneur in that sense. My uncle's an entrepreneur, so I guess it was sort of in the family-ish, although not my direct family. But no, for me, I mean, I was always really into tech, and I always kind of thought I was going to be in the tech space. Like, my dream job, this kind of at the time even sounded crazy, but I really wanted to go work at Microsoft. Like that was, that was where I wanted to do the work. I wanted to go like, go to Seattle, go work at Microsoft, go work for Bill Gates, do all that. And then it turned out when it, when time came to it, like going to Silicon Valley was much more exciting. So I still did the sort of normal path. I went to grad school, I got a JD and an MBA. Went to grad school. I, you know, in college I was president of the student government. Then I go to grad school, get a JD, MBA. I was vice president of the law school student government. Then got a job back at home, actually back in the DC area where I'm from. Got a great job doing stuff at a sort of mid-sized publicly traded tech company. And I realized when I was there that I was like, I, I, the best advice I ever got. So I started thinking I should leave and I was lucky enough to be introduced to a Sequoia-backed founder who was actually based in DC, which was very rare even today. It was definitely rare back then. Yeah. And he gave me really good advice. His advice was pretty simple. He said, look, if you wanna be in politics, Stay in DC. If you want to do finance, go to New York. If you want to do media, go to LA. And if you want to be in tech, go to SF. And I was like, you know what? That is the advice I needed to hear, or maybe the permission I needed to hear to say, you know what? I'm not going to stay in DC anymore. I will add that I was in a long-term relationship that I'd called off. So it was time. I was ready to leave. I didn't have any obligation to stay anymore. And I interviewed in Silicon Valley. It was like a dream coming out there. I was like, oh my God, Microsoft is that— or sorry, Google's that way and Apple's that way. It was like the coolest thing to me. I go to LA, I would have no idea who most of the famous people are. And the tech founders were the people I would look up to. And on my flight, boarding my flight, to fly back to DC, I got a call from my future boss who I didn't know at the time. He just said, look, when you land, you're going to have an offer in your email, and how fast can you make it out here? And that was 2010.

Okay. I was going to ask you, what timeframe are we looking at here? Yeah.

So it was 2010. So right after, you know, so 2008 was a really bad downturn. 2010, things were starting to come back. Moved to San Francisco in 2010. I literally wanted me out here. I really wanted to drive across the country and they wanted me out here so fast that I flew out and shipped my car, which I still kind of regret in some ways because it would've been great to do that.

Yeah.

Anyways, got out and that company after 18 months of me being there got acquired and I stayed at the acquiring company for a year and then started my first company and the rest has sort of been history.

Got it. So what was the first kind of bite at the apple of being an entrepreneur and being a founder? What kind of company was that?

Yeah. So we were doing essentially, imagine it as like I wanted to verify who people were. So this is the early days of the rise of the sort of the sharing economy is what it was called at the time. But imagine today what that means is like Airbnb, Uber, things like that, where it was like, wait a second, how can I trust, how can I be confident that I can go rent someone's random, uh, house? Like, actually, I'm in an Airbnb right now. We're doing this. I usually have my home setup. I don't right now. Uh, but, you know, how can you trust to go stay in some random person's room?

Yeah.

Or how can you trust to go get in a random person's car? And as someone in San Francisco, that was still odd, but not as odd as it was to most people in most of the country. Um, and I wanted to solve that. I wanted to essentially solve the trust problem. And so, we started building it. So, I found one of the really good engineers from the company that got acquired. He joined me on the team and then an early Google engineer also joined me. Actually, literally met him in my building in San Francisco where I live. And we decided to go build this company to verify identity. And we built some really cool stuff. You could get all that data back then. So, I literally like, okay, well, who's Justin connected to? What is your social graph look like? Right. Does that verify that you probably went to this university and you did this other thing, all these different pieces. And we— the interesting thing is we— that the ability to make that take off didn't go great. We started doing a lot of background checks, in fact, and we should have pivoted. We were going to build an API for background checks and we just got kind of ran out of steam and didn't do it. The downside of that is that we shut that company down.

Okay.

The upside was that I was able to invest in a company called Checkr, Which built essentially an API for background checks. I saw them in YC and I said, oh my God, that company is exactly what I was trying to build. I know this is a big market and I was an early investor. So the only— I'd rather be the CEO, that'd be worth a lot more. But the upside and positive of that learning was I knew that was a big business and an exciting one. But yeah, and another lesson learned there too is my idea I thought was really good and I was excited by what I was building, but man, I should have I should have just gone and joined Uber or Airbnb at the time. I saw these companies, I got to know all their founders, like literally got a car ride from an event, just like a fun event. He was at the event too. The guy, I'm blanking on his name, Ryan, who became the— who was the CEO of Uber at the time. This is before Travis Kalanick sort of came back or came into being CEO. He literally gave me a ride across the city because we were at the same party together and hanging out and he saw that Uber— Oh, wow. And I should have just been like, Yep, fuck it. I'm quitting. Shut down my other company. I'm joining Uber right now. And you know, I would have been employee like ten or something.

Right. Yeah. Hindsight. Hindsight. Yeah. So so it sounds like that first venture didn't pan out. And I guess you know for all of the founders that listen to this and entrepreneurs or people that are thinking about you know being an entrepreneur, you know what are some lessons that you learned during that first kind of not great start that Didn't deter you from starting another one.

Yeah. So, so kind of a few lessons learned there. Um, one was basically, what do I enjoy? Like, what brings me joy every day? Um, and what I realized what brought me joy was continuous, continuous learning. And the way to have the highest slope of learning, like just learn as fast as possible essentially, is by putting yourself in a really uncomfortable position. And one of the most uncomfortable things you can do and still earn money doing it is by becoming an entrepreneur. So that was essentially the decision tree for me. It was like, I want to learn as much as possible and how can I keep doing that? And so I wasn't— so that was the decision thinking. I talked to lots of different companies and startups. I wasn't quite ready to start another one myself, but it turned out— so then I ended up getting to know a company that had just gone through Y Combinator. The founder was an amazing technical founder. Both the founders were— there were 2 technical co-founders, and they really needed essentially a business co-founder, but they had already raised some money, so it was a little bit de-risked. They could pay me a salary, right? So I wasn't quite ready to go fully back in, but they could pay me a salary and I could become a co-founder because I already had some experience. I had a lot of business side things they were looking for, and I joined that company and my title was co-founder. of that. And that company ended up having an exit a few years later. So, you know, but that is the lesson for me is like, how do I just keep learning and keeping my mind really busy? And man, when you're trying to build something from scratch, there's nothing better.

Yeah. How is it different kind of starting it, starting something on your own versus kind of coming in after they've already raised a little bit of money? And so you're not having to go through all the headaches or all the learning of kind of raising money and doing all that fun stuff? Like, how was that second stint as kind of a co-founder versus, you know, the founder?

So, so, so look, the key thing in any job, and this, this doesn't matter if you're a founder, or you're just working for someone else, if you want to be successful in that job, you have to work hard and build up a level of trust with the person who's running the company. So my job in a sense in that role was, yes, I'm a founder and I have a founder title, but obviously I'm not the CEO. Right. So I need to go build, I need to raise my level of trust with him to feel comfortable with who I am and what I'm doing. And that just is hard work in getting to the point where anytime there's a question, you have the right answer. You are thinking of new ideas. What can I go build out next? How do I go do this? So bring proposals to the CEO. I want to go do this. I want to build this. I think we should try this. Stuff like that that a lot of people just don't do. And that's something that I just naturally gravitate towards anyways, but I also push myself to do that. So literally got to a point where we were doing great and actually the second sort of second co-founder, for a bunch of reasons, he decided he needed to leave. Okay. And then myself and the CEO got a lot closer because then it's just us. We're the 2 founders at that point.

So let's pivot to Chore. So talk to us a little bit more about what Chore is. And as you're doing that, I guess, how did the idea come about?

Yeah, look, the best ideas always come about from, I think, some level of personal experience. You need to have some reason for why you want to start your company. And for me, that was being a founder 3 times previous to that. and investing in at that point a few hundred companies and realizing that every single one has the same problem.

Yeah.

Every single company in the world has the same exact issue, which is basically you are passionate about something. You want to do what makes— what you are passionate about. That's why you start a company, is because you think you have some unique take on it. And it doesn't have to be some highfalutin crazy tech idea. It might be that you are passionate about the best coffee beans in the world and just want to smell them. Every day and you want to find the best ones from the best small farm in the top of the mountain or something, right? Like, that's what you're passionate about. That's who you love and you make really good coffee. And then suddenly you start your coffee shop and you're like, oh my God, I have this headache of I have to hire, manage, train, deal with all the regulations, finance that I know nothing about, all these pieces. And historically, there's lots and lots of evidence Many books written about this, actually, about how companies all fail not because their idea is bad, not because they're a bad founder, like because they, they, they aren't passionate enough or aren't willing to work hard. They're all willing to work. All founders are willing to work really hard, but they fail because they are not good at all these other pieces and they try to do it themselves.

Yep.

So guess what? Probably not a shock. When you try to do something you're not good at and you don't enjoy, You'll do a bad job. And if you do a bad job at HR, if you do a bad job at finance, if you do a bad job at compliance, you will end up failing. Your company will fail. And so this was a problem that I said every company has. Every company in the world has this problem, literally every single one. Most founders are not good at it. If they were good at it, they'd start a company like Chor to go do it. So clearly, by almost by definition, they're not good at it. Can I go solve it for them? And that, and that was the whole thesis behind actually my company before this called Abstract Ops. That was the thesis behind it. So we raised $10 million from top-tier investors to go build, to automate back office work.

Okay.

Thesis was like, can we automate this so we can make it wildly available? Um, a bunch of reasons I'm happy to get into. It didn't work. Uh, but we had a small core of an idea of something and we essentially spun that out, not legally, but essentially spun that out. And that became Chor. And I'm proud to say 2 and a half years later, Chor is a decent-sized company. It's a real company. We're fully bootstrapped, unlike my first 3 companies, which were all venture-backed. We're fully bootstrapped and we're a real company. We have lots and lots of real customers who are incredibly happy with what we do. We are enabling all these founders to pursue their dreams and frankly build more successful businesses. So it's a win-win. They pay us for doing a great job running their operations. They get to go do the stuff that's going to make their company successful. Everyone wins.

Yeah. And so let's back up to that previous company that didn't work. So I guess what was the difference between that company and this one? Obviously, it sounds like that one was better capitalized because you raised $10 million. And so yeah, maybe walk through what the differences are and why that one maybe didn't work and this one seemingly is off to a great start.

Yeah, in a sense, it's actually really simple. So we believed And this kind of goes with a lot of problems and challenges founders have and why many companies fail. We believed that back office work could be automated. Like if you can build essentially the record system of operations, you can automate every step. And if you can automate every step, you can delight customers and they can essentially buy a piece of software. Mm-hmm.

Yeah.

To go run their operations. Turns out, in retrospect, this seems obvious, but it turns out almost everything in operations is an edge case. So if you get some notice from the state of Texas where you're from about some former employee, that's sort of similar to other notices you might have received before, but it also is kind of unique to that individual. And so how do you deal with that? And there are thousands of situations like that. And guess what? If you— if everything's an edge case, you can't automate it. Like, code does not handle that very well. Now, AI might change that. AI is a lot more flexible, but code does not handle edge cases. You can code for a few edge cases. You can't code for 10,000 edge cases.

Right.

And so that's why essentially it failed. On the other hand, we had this small services team that was people solving these problems. Customers loved this service. They're like, oh my God, this is amazing. This is the greatest thing ever. I can essentially get a fractional chief of staff to go run my operations. Um, can we get more of that? And so we split up the company. My co-founder took this, the software side. I took this small little services business. I— we had no investors. We sort of— the comp— my former company owns a piece of Chore, so we have those investors in a sense, but they gave us no cash.

Yeah.

I made a very significant loan to the company to make payroll, um, and we were off to the races. And it's like, can we figure out how to be a way to be profitable? We were a money-losing business, this small services group, money-losing business. Can we find a way to be profitable? We need to raise prices on all of our customers right away. Can we keep them all if we raise prices? What's going to happen? All these questions. And once again, we have a lot still to figure out and a lot to do, but I know we're making a huge impact on our customers today, which makes me feel confident that we'd be able to make an impact on every founder in the future.

Before we jump in a little bit deeper, because I'm very curious, because I work a lot with startups, and, you know, kind of, I'm also an angel investor, not as prolific as you are. But, you know, obviously, being an angel investor, you're investing in very, very early-stage companies. But before we jump into that, I'm curious about the difference from a founder perspective between bootstrapping a business and raising money, because there are pluses and minuses to both sides of that coin. So as somebody that has raised money for companies that were successful and ones that maybe weren't, but now you're bootstrapping one, and that one seems to be, you know, moving in the right direction. What are your thoughts and opinions on going out and raising a bunch of money versus trying to build something organic, slow and steady, eye towards profitability?

Yeah, I mean, the first answer is basically, Bootstrap if you can, to make it a short, simple answer. Bootstrap if you can. The reason is because it can take a long time to figure out the right solution. And so with Abstract Ops, my previous company, we took $10 million. But when you take the money, what people don't understand is when you take money from VCs, you are on the clock. Like you take that money, you have an 18-month, maybe at max 18-month runway. before you're either, you're essentially dead or you're onto your next fundraise and moving again. You don't have a lot of time, so you need to be able to, willing to move really, really fast. And that probably will push you to do things you wouldn't otherwise do. And many of those things could lead to the destruction of your company. So with AbstractOps, had we been able to raise the money but not had the pressure of moving fast, which you can't do, like once again, if you take the money, you have to move fast. Yeah. But let's pretend you could. That company would still be around. We wouldn't have hired as many people as we did. We wouldn't have spent money in every single way to figure out, like, we need to figure something out that's gonna work. And once again, sorry, the company is still around. They pivoted though. And so that's what the pressure that you get from taking VC money is to move quickly. I come across founders sometimes like, oh yeah, like we've been around for 6 years and like we're gonna go raise our next round of funding. I'm like, dude, you're dead already. Like, you don't get it. You're dead. You have 18 months. If you can't move fast enough in those 18 months, your VCs won't give you more money. They don't care. Yeah. You've missed your window for whatever reason. You've missed your window. They will fund someone else. And whereas with bootstrapping, we can take our time. And that's really important, at least for the industry that we're in at Shore, because I spent $10 million of VC money to try to figure out how to automate back office work. I do believe it's possible. It's just really freaking hard and it's slow going. It's not write some code overnight, you've automated. It just doesn't work that way. And therefore it's not VC backable right now. Now that could be very different. Once again, there's some cool tech happening. There are some things changing. I still don't think it's fully VC backable, but there's a different discussion out there. But the long version of it basically is The moment you take money, you need to move from a mindset of I'm rich in time but poor in cash, which is what an early-stage founder is, right?

Yep.

You have abundant time and very little cash to cash-rich and time-poor. And when you're cash-rich and time-poor, you have to be— you have to start spending.

Yeah.

You're not there to save the VC's money. They didn't give you the money to put it in a bank account and make 0% interest on it. Right. They gave it to you to go spend, to go spend on great engineers, to go spend on something like hiring Chore, my company, to take operations off your hands so you can move faster as a founder. That's what they gave you the money for. And you need to— you have 18 months to move as fast as you can. Otherwise you can't, or find a way to get to profitability because you'll never get another round of funding.

Yeah. So let's go back to Chore. I'm very curious to dive into the services. So, you know, obviously you talked about kind of people helping with back office support, which is, you know, why to use your coffee bean example. Somebody that's a great coffee barista is like, hey, I want to go open a coffee shop. But that doesn't mean that they're going to be a great owner or runner of a coffee shop, right? I'm a— I was a great recruiter. I decided to go start a recruiting business. That does not necessarily mean that I would have been a successful entrepreneur and owner and runner of a recruiting business, right? So I guess talk a little bit more about the use cases for Chor. in these different businesses? Because as you mentioned, you know, all businesses have the same challenges and responsibilities from HR compliance, finance, accounting, taxes, etc., etc.

Yeah. Yeah. So look, this is the thing in the thesis we have is, as you said, every business is essentially the same. So the funny thing is, people like to think they're a special snowflake. You and I probably both like to think we are special and unique in a lot of ways. The simple fact is though, the truth is we're both human. We're both pretty much the same. This is why you can go to the doctor and the doctor can treat you and treat me because we're both basically the same. And businesses are the same way. There's no difference between every business. They're all essentially the same. Now, there are key things about every business that make them really unique and special, right? So your go-to-market plan, how do you go to market? What is your go-to-market plan? How do you describe your business? That is unique to you, right? The really good coffee shops aren't necessarily always because they have the best coffee beans. It's 'cause they build a really good story around themselves. Your coffee and your product, that's also really unique to you. So those are things you should focus on and build, but everything else, get it off your plate. And once again, that's with chores. Like, guess what? HR is kind of the same. Yeah. across every business. Compliance is essentially the same across every business. Finance, you need to do accounts receivable, you need to do bookkeeping. That's all essentially the same across every business. Equity, if you're a startup company and you have equity, that's also kind of the same. So how do I find someone who can go run all these pieces? And that's the idea of what Shore is doing.

And so where do you find your talent? Like what type of You know, being in the recruitment world, I always go to like, okay, where, where are these people? How do you find them? How do you train them? Because nobody is good at all of those things in one person, right? You've got to, you know, a lot of people are good at a lot of things, but maybe not good at everything. So, so talk us through like your people process, because if I want to bring on an operations person or, you know, an HR person, like what, what do I get? Like, I'm just kind of curious about the actual nuts and bolts.

Yeah, absolutely. So what you get is you get essentially what we call fractional chief of staff, I call them a chore CEO. So you get a CEO to do your admin and essentially the chores, right? That's what you get with chore is this person who's gonna be your main point of contact to go run all the operations. Now they're not gonna do every single piece as you shouldn't expect them to, right? A good chief of staff is gonna go find experts in different areas to go take care of certain things they're experts on, but that chief of staff is gonna be responsible for the outcomes. So the outcome is I want to onboard a new employee. Should that chief of staff be filling out that offer letter and adding that person to payroll? Maybe, but maybe not. Should that chief of staff be filling out new equity grants? Maybe, but maybe they cannot do that and have someone else who's an expert do it. But that chief of staff is responsible to making sure that new employee is onboarded on time, has all the information they need, and is ready to get started on day 1 to go crush it for your company. So essentially that's what you're getting is a person who's going to go run all of this for you and deliver outcomes that you can expect that are the same every time and freaking delightful.

And are, are your, are these chore CEOs, are they US-based, international, depending on where the company is? Like what's the, what's the model? Because obviously, you know, cost is, is a, you know, gonna be somebody's next question and, and all that fun stuff. So I'm curious how it works.

Great question. Absolutely. So, um, the tour CEOs today are all based, uh, in North America. We have some in Canada. Um, they are helped by a team that we have overseas to do some of the work because once again, it's not always efficient to have the same person do all the key things.

Yeah.

So they're helped by a team overseas and that model's constantly evolving. Um, in the end, our thesis, and this is just what I actually believe for every product, is customers generally don't care Where things, who does it, how it's done, right? I'm not asking Riverside where we're recording this, what is their underlying code base,

right?

It's irrelevant. It's irrelevant to me. I just know their product works. And it's the same thing with Chor, which is like my customers expect us to give them great outcomes for a price that makes sense. If we're able to do that, they're delighted. How we do it, they don't care.

Yeah. As long as everything is done. Like if I tell, if I, to your point, like if I say I have a new employee starting in 2 weeks and I need them to go through the onboarding process, which we've created, right? Then I don't really care how it works as long as it works and it's repeatable and I can move on and be focused on more business revenue generating activities and don't have to worry about the back office.

Correct. You just need to be able to say, go do, get it done, update me when it's complete. And if that's happening, that's what— that's why I want to hire everyone on my team like that. I don't care if they're internal full-time or an external outsourced resource. Their job is to get it done on time. Delight me if they're doing that, they will always have a job.

Yeah. And then I guess what's— what are you hearing from— because you're based in San Francisco, I know you're in the DC area, I guess now, but what are you hearing from startup entrepreneurs that are starting businesses now? Right? If they started a business in 2021, and they had AI in their name, they would have gotten 20 VCs to throw millions of dollars at them. That's not the case right this second. You know, the private equity world more where I live, VC world more, it sounds like where you're, you're, you're living in, you know, it's a different time because we're recording this in late July, late June 2025. So what are you hearing in San Francisco from the startups that you're either hearing pitch for your angel investing or that you're interacting with that are, you know, clients or potential clients of Shore?

Yeah, I mean, a few things. I mean, one, everyone's an AI company now. Like, it's sort of like saying— it's sort of silly to say you're an AI company for a lot of them, frankly, because, um, uh, it's like saying you're an internet company. I mean,

yeah,

like, everyone's in a company. Um, so everyone's an AI company. Uh, it's hard for some people to raise money and it's easy for others. There's, there's still a lot of money out there. Um, I hear about deals regularly and people are raising pretty massive amounts. But it's also hard. Like, for me as an investor specifically, I'm having a lot of trouble deciding when and where to invest and who to invest in, mostly because the world is changing at a more rapid pace than I've essentially ever seen.

Yep.

So for me to predict, right, if you think about it this way, ChatGPT came out, what, 3 years ago? A little over 3 years ago. That's 3 years. AI is the worst it's ever going to be today. What's going to happen in 3 years from now, let alone 10, when that startup I invested in is supposed to go public or have some exit? I just, I don't know. The world, we're going to be living in such a different world. It's very difficult to predict. And it makes me scared to put my money down as an investor, which I don't know, some investors don't feel that way, but that's how I feel personally.

Yeah. I've talked to a few VCs and it seems like they're, you know, everybody's trying to be the winner of AI, right? There, somebody's going to win the race, right? And, and so they all, they want to be invested in as many AI or AI-adjacent startups as they possibly can, because maybe that one is the one that, you know, it's like the dot-com world where like everybody's, you know, investing in dot-coms, right? And then, you know, one was going to win. And, and, um, and so I, I was, I haven't talked to a ton of people in the Bay Area, um, so just kind of curious to get your thoughts because you're, you are an entrepreneur, you interact with a lot of them, but then you're also an angel investor. So you're getting in at the just past the back of the napkin idea phase, which is the most risky, but obviously there's more reward and all that stuff as well.

So yeah, I'll take a controversial— I'll make a controversial statement that, check me on this in 3 years. We'll see if it's true, or maybe 5 years. But I would bet you that a large majority of VC dollars, a better use of that money, if your bet is, I want to bet in the one that's going to win, right? There's just one that's going to really take over and win this. especially if we assume there's going to be some version of AGI or superintelligence or something like that, you should take all the money that you're going to give into VC and put it straight into the Mag 7. So basically Google, Meta, maybe Apple, hard to know if Apple, maybe not them, but Nvidia, Tesla, and Microsoft.

Right.

Put your money into those 5. Let it ride. One or two of them will probably be the winner. And there's a good bet that whatever the systems are creating— not a good bet, there's a fair bet that the generic AI systems, when they reach superintelligence or general intelligence, they'll be so much better at every single task that a human could do. and so easily be able to figure it out, they will suck up all the resources out there. This was actually the early OpenAI bet, where they were basically like, if this takes off and wins the way we expect it to, it will essentially be the wealthiest, most valuable company known to man because it will essentially be the only company left. That was essentially their bet. So bet on those 5 and you might turn out okay.

I don't want to go down this rabbit hole, but then if that's the only company that exists, they win. OpenAI wins and they're the only company left, how is everybody going to pay for anything?

So, Justin, you didn't want to go down this rabbit hole, but now you just did. So, so, uh, I— this is also maybe a controversial take, I'm not sure. Um, but I, I actually think, uh, we're gonna go through a really rough time for about 5— the next 5 to 6, 7 years, um, maybe 10, where everyone's losing their job and there are no jobs available because you've been replaced by an always-on incredibly low-cost, brilliant, you know, new, new teammate that has taken your job. Um, because just AI is smarter, faster, better, doesn't get tired, etc., etc., etc., right? Doesn't get sick. All the, all the, the beauty but also challenges that humans have. Um, right. Uh, it's gonna be really challenging. Um, and then we're gonna reach a point where we are a post— uh, or we are an abundant world where essentially all things are free because we've essentially solved for all the scarcity that's in the world today. We reach a point where there's superabundance and then we reach a point where money doesn't matter anymore. So I will happily go on record, I guess, in this case. I don't think I've ever said any of this to anybody on the record. We will get to a point in the next 20 years where we are probably in a post-capitalist society where money does not matter anymore. Now you have to get to that point and it's going to be a really rocky freaking time.

Right.

We will get to that point and we will be a post-capitalist society. Money will be irrelevant because everything is abundant and therefore everything is essentially free. Energy, food, water, you name

it. Yeah. It's just that 10-year period. That's what's scary because that's the— Yeah.

It's really scary and really challenging.

Yeah. Because there's going to be an even bigger divide between the haves and the have-nots. And it's going to get really, really, really, really weird. And I don't even want to think about it, frankly. I got a hard pivot out of this.

A lot of the smart people I talk to, I ask them what they're doing. And frankly, a bunch of them have said— one literally said to me, he's like, I'm buying a gun. Another one said to me, I'm making as much money as I possibly can right now and saving it up. And I'm going to Fuck off to some other country and hunker down.

It's very similar to conversations that, that Allison, my wife and I have is make a lot of money and buy some land and become a homesteader. Because if you can grow your own food, and you have water that you can either capture from the sky or whatever, it's, you know, you don't need the other things, right? You can, if you can live off the land, then, then you're fine.

But yeah, going to another country, maybe They'll come find you anyways, right?

Well, that's the point. That's the point of getting a gun, right?

Correct. But I still will say, like, I have to imagine, I almost have to believe for my own sake and sanity, we're not going to be in an apocalyptic world. It's just going to be really tough. Like, it's going to be a really tough time. Like, we're not going to— it's going to be— it's not going to be complete disorder. That doesn't serve AI's endgame. It certainly doesn't serve humanity's endgame. There will be some semblance of the world's still working. It just will be challenging.

Yeah. Challenging to say the least. But we'll see what happens. I want to try to pivot away from this doom and gloom conversation because we could— I could definitely spend another hour on this and, and all that. But I guess, as an angel investor, right, you've invested in, I think you said, over 200 companies at this point. What are, you know, if somebody's listening to this, and they're thinking about raising money, or they're trying to raise money, and they haven't been able to, what are some of the things that you as an angel investor automatically are red flags when you see a pitch deck? Or when you listen to a founder talk? Like, maybe give us some, like, what are the things that you, you know, are red flags right off the bat, because you've invested and you've had success and obviously probably some failures, but, but what are some of the red flags that you see constantly still in people trying to pitch and raise money?

2 ones that are kind of related. One is a bad pitch deck. Like there is no excuse today for having a bad pitch deck. Your pitch deck should be on point, freaking beautiful, look beautiful, really clean, really crisp, really clear and concise. Yeah. That's number one. And that's related to an inability to tell a clear, coherent story. I get it if you're a founder who has like a million ideas and you're like, well, we could go this direction, we could go this direction. I'm not sure about this. I get that you have that, but, and I like hearing those stories, don't get me wrong. I think it's actually a great way for me to learn. But as an investor, I want somebody who's gonna be able to tell me, we are going, we are shooting for the stars and here's what the stars look like and this is where we're going.

Yeah.

Because you need to be able to tell that story to everyone you talk to. It's not just, you need to be good at pitching VCs, but you also need to be good at pitching your team.

Yeah, employees, because they're gonna have to come in and probably make a lot less money cash-wise, but they're buying into the vision, right? Especially those early employees.

Correct. So you need to be willing and able to say that, to be like, and you need, if you're not good at telling that story, you won't recruit a good team, you won't be able to build where you're going, and you will end up failing as a company. And so telling that story, which of course, once again, relates to your ability to build a good pitch deck, because it's essentially a function of your story. Is a really strong signal for me.

What about any kind of things that you love seeing aside from the inverse of the red flags? Like, obviously, there's probably things that you hear from founders or, you know, first-time founders or repeat founders that you're like, yep, they're going to be— you kind of almost like can tell like, yep, they're going to be successful, or they've got a better than 50/50 shot of being successful.

One, their knowledge of the space itself. So if I start asking questions and you can go pretty deep on it and explain all the different nuances. So a story I've told a bunch of times, but like Human Interest is a 401 company. The founder and I sat down for coffee. This was before they got into Y Combinator. So this is very early on for them. And he was a former, like he had a company that was doing like website design. Basically. So not a 401 company at all. So didn't have experience. He had a story for why he was doing it, because he had trouble getting a 401 for his current company and all these other reasons. He was like, it was a mess. But we chatted about it, and essentially what he's— what we sat down and had talked about, he was like, look, I've taken— I'll call it the Series 7. I don't know what the actual test was, but there's a test in every state you need to take to essentially be able to offer Do 401s. Okay. Pretty serious financial test that you have to take. Yep. And each state's a little bit different. And he was like, yeah, I've taken 7 of these and passed all of them. And this is a test that like large majorities of people fail multiple times in just one state.

Yep.

And he had, before he had gotten in, I think he had just gotten into YC, but like before he even like basically got into YC, started YC, he had already taken and passed these tests because that was the only way he could do his 401. In those states is if someone on his team had the license and he went and took that test. It's like, I'm like, oh my God, like, that is impressive. Like, you are,

yeah,

already a next-level founder that you went that far to go study, do this, and pass it when most people fail.

Got it. Yeah, no, I, I mean, a lot of the financial companies, they hire people with the assumption that if you don't pass whatever series test you have to take to get the job, you're gonna get cut, right? So the fact that he could, you know, took 7 of them in 7 different states, that's, uh, that is pretty impressive. Um,

I wanna go back to your, your other point really quickly about what I look for and about that side of things. Yeah. Um, just, just one extra point there, cuz you as a recruiter probably get this. Um, uh, the point of having a really good deck and being able to tell your story is to me the same thing as having a really good resume. Mm-hmm. Um, so I recently rejected someone from moving forward with us. Because her resume had formatting errors in it. And I literally tried to tell our recruiter, I said, hey, like, this person's not moving forward because if this is the best they can do in their resume, what are they gonna do when we hire them? Mm-hmm. This is, if this is the best face forward they're gonna put, cuz no one's ever gonna be better than when you're looking to recruit them at that point. They're gonna put their best face forward. They wanna look wonderful. Of course you're trying to get the job there. If the best they can do and it has Issues and spelling errors or formatting errors or you name it, what does it say about everything else when they're not being as carefully watched? Yeah. It's the same thing with investing. So if they can't build a good deck when they're trying to raise millions of dollars, they're never going to be able to do it. That's just not a skillset they have. And you have to have that skillset to tell that story, to be so focused and precise and detail-oriented that this is important to you. You can maybe, there's nuance, like maybe you're a hardcore technical founder, maybe you could get away with explaining that's not your thing, but then you have to have a good co-founder who's a business founder who maybe it is their thing. But generally speaking, if the best you can do in front of the public does have errors in it, you're gonna be a failure.

Yeah. I mean, the pitch deck is similar and probably, you know, the resume is way easier. You throw it into ChatGPT and say, format this thing. Or, you know, there's so many things now that there's no excuse. That's the point.

There's no excuse. And so if you have a bad deck, you have no excuse at this point.

Yeah, I mean, I've been doing the recruiting side for over 18 years and I still see the same errors, the same mistakes, the same things that are repeated from 18 years ago to today. And yeah, there is no excuse.

I mean, like, I remember when I was doing— I haven't built a resume in a long time, but when I did my resume early on, I would I would make sure it had the exact number of spaces, exactly the same. And every time I checked for the period in every place to make sure it was there, like literally every minute thing. And I was just anal about it. And this was just— to me, it's shocking most people aren't that way. Yeah, the requirement in my mind.

Well, now you can hire an AI bot to apply to 1,000 jobs a day for you. And that's, that's a whole other story and maybe another podcast around AI impacting the recruitment industry because it is It's having a little bit of an opposite effect of, I think, what they're going after, which I think is fascinating. But

for sure,

we can talk about that at another time. I do want to kind of get to the— to wrap things up here. We talked a lot about, you know, starting businesses, and I think Chor is kind of really interesting from a standpoint that, like I said, just because I was a great recruiter does not mean that I'm going to be a successful recruitment company owner, right? There's a completely different skill set to running a business than to just being a good practitioner, right? And so sure, I think, you know, I'm not a customer, I just want to say that out loud. I have not dove into being a customer yet.

You should be, and all of your portfolio companies should be.

Well, there you go. So that's why I said yet. So I wanted to, you know, chat with you first, but obviously, but, but I guess from if we jumped on a podcast 12 months from now, obviously, you've got goals for, for Chor. You know, you're bootstrapping it, you're kind of growing it steadily but surely. I guess if we jumped on a podcast in 12 months, like, what are the 1, 2, 3 things that you would— you want to have achieved for, you know, to come in and gloat on the podcast, say we did these things?

Yeah, I mean, probably our biggest one, I can't give away too many of our secrets, but I think our biggest one is that we've cut our costs by our price, essentially, and therefore our costs, of course, too. Because we don't have VC dollars. So cut our costs and therefore cut our price while keeping our product quality, essentially the delight at the same level, if not better than it was today. So essentially, how do we become way more efficient and effective using technology, but using also just better process?

Yeah.

To reduce our costs while making a product that is at least as good, if not better than what we are already producing today.

Got it.

And just essentially constant continuous improvement, which is like kaizen, which is a great term for that. But like, yeah.

Well, if you're the one company out there that's actually getting cheaper than more expensive, that is probably a welcomed sign to your customers and potential customers. So that's a very lofty goal. So I commend you for that. Awesome. Well, let's— I really appreciate the time. I could probably talk for another hour or 2, to be honest, and ask you a bunch of different questions. But I'll I'll wrap this podcast up like I do with every other podcast with a 3-pack of questions. First question is, what's a business book or influential book or podcast that you would recommend our listeners to check out? Yeah.

I mean, look, I'll give you an answer to book and podcast. Look, I think Tim Ferriss is sort of the OG of a lot of things, but the way he does podcasts, how he does it, I try to model my own podcast after a lot of that. In his questions, his insightfulness, his thoughtfulness, and also the people he brings on, I learn something new every day. So that is just a great podcast, business, but also life and philosophy. Book-wise, probably one you haven't heard of, a book called Accelerando. Okay. Accelerando, I will say I got the recommendation not from other people, but actually from AI, a very early version of AI. when it started to become a thing a few years ago. And I basically asked AI, I was like, what are the top 10 books on AI that are sort of sci-fi books on AI? And this is the one that I chose to read, and I thought it was fantastic. The high-level thesis is essentially a large portion of humanity uploads themselves, becomes compute. We become part of the computer. Some people don't do that. Some people become They have multiple versions of themselves, like, you know, multiple agents of myself, and they go off and live in sort of spaces and things without giving too much away. But it's a fascinating story, and I think a decent vision of what our future might look like.

Yeah.

I mean, so to me, that was just, you know, I want to think through what the future is, and one way to do that is read a lot of sci-fi.

Yeah, no, it's fair. I mean, that's— I had not heard that book, so I'll definitely, definitely have to check that out. Favorite thing to do outside of work?

Reading. I read a ton. I want to learn a ton. I read a huge number of articles every single day. I put the top ones actually are listed on my LinkedIn page. There's a link to my script top reads if someone wants to follow along what I'm into. That's probably only about 10%, 15% of maybe all the articles I read every single day or books that I read. But I try to put the good stuff up there that I think folks will find fascinating. But in the end, it's just reading. I want to learn every day and there's not enough time in the day to keep reading. But that's what I like to do. That's my favorite thing to do.

Got it. Awesome. Well, this may coincide with the third question. Favorite vacation spot, someplace maybe to go read a book or something, huh?

Yeah, that's actually exactly right. Would be my favorite vacation spot. But the funny thing is I really thought about this question when I was reading it pre-podcast. In a weird way, this would sort of take my mind to my favorite vacation spot. And what I mean by that is I don't have any place where I'm like, oh, this is the place. I don't need to go sit on, I don't know, a winery in France or something to have a good time and be a happy vacation spot. There's lots of places I enjoy. Generally would be sort of probably in nature, or at least partially in nature. But beyond that, I don't really care if I can have a place that I can sit, it's quiet, I can listen to nature, read a good book. I'm pretty happy. I mean, I do go skiing a decent amount, but I don't have a favorite ski area that I'm like, this is the place I have to go every single time. There's beautiful places all over the world. My bigger challenge is not having enough time to go do all the things that I want to go see or do or read. Or learn about or build.

Fair enough.

Have more of that.

Well, if you upload your brain to AI, you can learn everything in an instant. It'd be like The Matrix.

We're going to be there. Not The Matrix. I don't want that. But I'm excited for the world where I can learn and interact with all things in every moment in a newfound way that we haven't maybe had before. So I think that world's coming. Kind of excited for it.

Very cool. Well, it's been really awesome, Adam. Thank you very much for spending time on the podcast. If people want to learn more about you, maybe they want to catch up with you in San Francisco, maybe they want to pitch you a startup idea, or they want to learn about Chore, like, what's, what's the best way to get in touch with you?

Yeah, best way, a few different ways. Obviously, one, you can check out my company's website, hirechore.com. You should hire us to do your Your admin and chores. hiretor.com. My podcast is Entrepreneurial Excellence. So it's all about what makes for excellent entrepreneurs. What does that look like? So check us out on all your favorite podcast places. You can generally find me on LinkedIn, very active there, fairly active on Twitter. And so you can kind of find me anywhere and get in touch, drop me a note. I do like to— I would love to have excuses to get out of the office. So if you're a founder building some really cool stuff, drop me a note. I'd love to meet you in San Francisco when you come here.

Awesome. Adam, very cool. Thank you very much for the time. Really appreciate it. Yeah, and thanks for being a guest on the podcast.

Justin, thank you for having me on.

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