He Scaled Two $1B+ Companies (WP Engine & A Smart Bear) | Jason Cohen

How would one go about bootstrapping a billion-dollar business?

I don't think you should.

This next interview is with Jason Cohen, founder of WP Engine. He also founded another company called A Smart Bear. Both are unicorns. Companies are worth over $1 billion.

I'm currently at WP Engine. We host about 2.5% of the top 10 million domains. So a large percentage of the internet that matters.

He talks about his frameworks, how he thinks about strategy.

Strategy is overall how you're going to win. It's this set of decisions that make you unique.

He talks a lot about really what you need to do to go from $1 million, really, maybe even zero to $400 million a year. That's the playbook. And you're gonna get a lot from this. I really like how he thinks. And I think this will also challenge you to think differently so you can be more successful. So without further ado, let's get going. Jason, how you doing?

Great.

Thanks for being on the pod. How would one go about bootstrapping a billion-dollar business?

I don't think you should. I think when you're bootstrapping and maybe self-funded is a better word because really it's about funding source and goals. I think if your goal is to build a really big, valuable company, one of the— yes, there's a few examples you can find where that happened over like 20 years and it was self-funded and all that stuff. You can find it here and there. But of course, that's like the 1 in 10,000 or even literally 1 in a million Small companies that do that. So while that's true, that's not a good path. That's not a likely path. So if you want to do one of those, almost always what happens is you raise money. Why? Because you've got to grow fast in order to get there. Why? Because a technology that's 30 years old is probably not relevant. So you're not going to grow 20% per year for, for 20 years in order to get to, say, $1 billion in revenue, which is what it would take. To grow slowly and get there. That's why you have the normal thing from like TechCrunch and VCs that say, all right, once you get to 1 million, you got to triple at least and then triple again and then double and then all that kind of stuff. That's why, because otherwise you just don't grow fast enough to get there fast enough. It's still going to take 7 to 10 years just, just to get to something like 100 million at that rate. Right. To grow that fast and not spend money before you have it is just Again, almost never happens. Therefore, you shouldn't bootstrap and self-fund in order to build a billion-dollar company, right? You just shouldn't have that goal. Now, what you can also do, though, like with WP Engine, is I did start bootstrapping it and my idea was I think this company could do like $30,000 to $50,000 in profit per month and still be pretty small, and that'd be pretty neat. And then that was— that turned out to be true.

Nice.

But then it turned out that the market was so big, so much bigger than I had thought. And I was just in a place in life, having done several startups, also having now being a parent, blah, blah, blah, where I wanted a different kind of challenge, where the challenge was to try to get to be really big instead of—

Despite your responsibilities. Let's go for another one.

Well, yes, because you can have a bigger team and it's not all on me.

And so, yeah.

And so I just wanted a different kind of journey, different goals and challenges, different constraints, but also different expectations this time around. And also, again, these other things were in place like the market was big enough that the core, the core business model was and technology was working really well. Like all these things were in place where it made sense. But so that's an example where you could bootstrap and not have that goal, but then change your mind once, once you see actually all the cards look like they've turned up the right way for that. But again, I don't think— I just think it's really bad to go in thinking like it has to go that way. No, it doesn't.

It's— or is okay.

It's better. Yeah, because it's optionality. Who knows how anything will unfold? And so if you only have one path in mind of what success is going to mean or how it could unfold, if it doesn't go just that way, what, you're a failure and it doesn't work, right? So that's brittle. It's unlikely to do any given path. What, are you going to feel bad? Did you build and construct your company so that it would only work that way so that when that didn't work, it falls apart? That's just a brittle company. So Optionality and saying or is strength in a company, right? If there's many ways you could go to market, you're strong because who knows which one will work?

Yeah.

You know, if there's many ways that you could grow or be successful, it's good. That's part of why, for example, it's good for companies of any size to be in a large growing market, because even if you're making a small company, a large growing market has a zillion niches that are too small for whoever the big people are in the market. And yet the fact that the market is big and growing proves there are customers, they're paying money, there's more coming in all the time. You know, like demand must be there. Like it proves all of these things that are normally a risk.

Right.

And yet there must be niches and new ones coming up and the niches are themselves growing and big companies can't look at all of them and certainly can't specialize in all of them. So it gives you space. So of course, as a big company, it's nice to be in a big market because the money needs to be there or you're not going to. Yeah, but even a small company, you want to be there.

It just—

it's optionality once again.

So, you know, it's interesting. You brought up niches a couple of times, and my podcast co-host on the other podcast, Neil Patel, actually tweeted something out recently this week saying, you're doing it wrong. The riches are not in the niches, right? Blah, blah, blah. And so he's always, you know, it's the headline at the end of the day. And so what's your take on it? Because obviously WP Engine is very niche-focused.

It depends. I mean, WordPress is 43% of the internet. So to say that we're targeting that niche, I mean, something that's 43% of the entire internet is hardly a niche, you know? So I suppose you could define niche and define market and define this, define that how you'd like. With all advice, like riches are in the niches or no, they're not, you can always find the opposite advice. And it is also true sometimes, false sometimes. They're both like that. And in both cases, you'll find examples of companies that that found success because they listened to that advice and companies that failed even though they heeded the advice on both sides. So what does that mean about all this advice? It means it's wrong to ask which one's right. That's— that can't be the right question. A better question is, when is this advice applicable? That's the question. Clearly, it is sometimes and not other times. So if we just say riches are in the niches and that's all we say, I don't know what to do with that. Right. But if you say, okay, listen, if you want to be a solo founder and never hire anyone but generate a lot of profit and also leverage your expertise that you already have and not have really any real competition, then a niche is probably your best way.

Hmm.

For all the usual reasons, you actually can be the best even though you have almost no resources at hand to apply to it. You can nevertheless be the best so long as you define The best for whom? For what? For, you know, sufficiently narrowly, you can in fact be the best, really, which means you can charge more, which means you can be profitable and you don't have to fight all these things. You have to fight them in marketing spend. You don't have to fight them in features because these are all things as a solo founder you're not going to fight. You're not going to win those fights. So that's why blah, blah, blah. So in that context, niche, the niche makes a lot of sense, right? But even then, can you make a case for a solo founder company that makes something general. You could, but you'd— there would be a whole bunch of other decisions you would also want to make simultaneously to make that a, a sensible, self-reinforcing strategy where all the decisions are like causing this harmony. For example, you might say we're not going to have any tech support, otherwise we can't scale as one person.

Mm-hmm.

But we could be so, so cheap. I could make a thing that's so hands-off. We never speak to a person, we never do anything. And for most— for a lot of people, that just means we're not the right choice, right? But we could take every currency in the world. And since we don't talk to them and our product— this is— I'm just making this up, but like, suppose the product is very visual. There's almost no text. So I could support 50 languages because there's really not languages and I never have to talk to anyone for support or sales or marketing even. And, and I could charge almost nothing, which it works really well for the whole world. Most of the world doesn't have money. So if I can charge $5 a month or $1 a month and somehow make this work, I don't know what that would be. But let's suppose then you've just, you've just created this thing where maybe there's not a niche. You are targeting the whole world because you've made all these other decisions that made that make sense. So a lot of times when you think about strategy for a company of any size, this is the kind of stuff you should be thinking of. What is a set of decisions altogether of which is a unique thing? Not any one of which, but altogether is something that makes you special, leverages whatever strengths you have, whatever those may be, avoids whatever weaknesses you have to the extent you can. And yet, of course, still targets a market that exists. I mean, these are all obvious things, but like, what is that set of stuff? So it's just a long way of saying, see, I could take any given thing by itself and justify it, But I would have to put around it not even just context, but just other decisions like, and I'm going to do this and I'm not going to do that. And now I've created a strategy that makes some kind of sense. That's what one should do with this barrage of conflicting advice.

That's why I think advice is dangerous. I mean, because the Thomas Sowell quote that I really like is there are no solutions, only tradeoffs. And it's like tradeoffs depending on what? Depending on your strengths, your weaknesses, etc.

Exactly. And so, in fact, you might argue that's what a strategy is, is deciding what those tradeoffs are. I often like to say it's simply making a decision. Yes to this, no to that. Of course, that comes with tradeoffs. I would say another thing it comes with is consequences. Now, again, you could just call that tradeoffs, fine. But not only is there the immediate like, okay, I said yes to this and no to that, so that's what I did. But then there's these downstream consequences like we just talked about, right? That's what I was doing is, well, what about and what about and what else would that have to mean?

Yeah.

So some people call that second-order effects, whatever. It doesn't matter. There's this cascading set of, of consequences that these decisions make. Therefore, once again, you want to say, oh, so what is this whole set of decisions where despite the cascading effect, it's harmony, it's harmonized, and therefore they all make sense.

Mm-hmm.

And then, and then turns into something. And then if a competitor, whether that's a new startup or an existing company, looks over at you and they're like, I'm going to copy that. Well, if they copy one of your decisions, it really doesn't matter. You know, they would have to copy the whole system, which they can't because they got their own system or they don't. There's actually really interesting examples of companies in history who have done this where their strategy has been analyzed and published, and yet decades later, no one's copied them even though anyone could. So an example is Southwest Airlines, the only airline in America to never go bankrupt and be profitable.

Ever.

So that's good. Whatever they're doing is a good idea, you know? And what do they do? And this has been analyzed by many people. There's this diagram that I love from Michael Porter, who's a kind of famous thinker in competitive strategy, who diagrammed out exactly what I'm saying. They made all these decisions. And what's interesting is some of them are bad for customers. This is again, like there's tradeoffs, like it's not all going to be good news, right? Like you said, So, so with Southwest, for example, they have the lowest fares. The planes have the best on-time percentage. So they're really reliable. And the people who work there are really friendly and good. That's some of their advantages. But what other decisions must one make to have stuff like low cost? So they do things like they only have one kind of airplane. So their mechanics only need to know one thing and they only have one set of tools. Like, these are things you don't normally think about unless you're in it, right? Right, right, right. And so they can fix anything fast. Okay. And it's cheaper and, and it's easier to train and they can go deeper with the one kind of plane. Because if you have 10 years of experience and you have 10 years of experience with just one model, you're, you're a super expert and so forth, right?

Yeah. Okay.

So that's actually cheaper, but— and there's other advantages. Okay. But then you start getting to the consequences. Well, how do you have bigger planes for like overseas? Well, they don't, so they don't have overseas routes. Oh, and actually they don't have any long routes. It's only short-haul routes. Well, if I want to cross the country, would I have a million stops? That's no good.

I know. Yeah.

And also, you know, they won't transfer you to another airline. And also they have all this baggage that— blah, blah, blah, blah, blah.

Too bad.

Oh yeah, too bad. Because in order to get these good things, we're going to have to have these other things. There's no food. You know, it's all this stuff. Oh, okay. So but by mapping out that network, you can decide, is this a good set of tradeoffs? You know, it's just, you know, do enough people want the benefits and dislike the negatives low enough, right, that this is the right choice for them?

Yeah.

Of course, the answer is yes in this case for many people. Now, this was published— this analysis was published in 1995. So airlines have had decades. I mean, they could have analyzed it themselves, but okay, someone else analyzed it for them and published it for them in HBR. So, okay.

Yeah.

Now you want to copy this so that you don't go bankrupt and you manage your costs? No one has. Yeah. Why not? I don't know. That's how it works. People don't do that. You know, what are you going to do?

That's what the late Charlie Munger said, too. It's like, it's a wonder why people don't copy our model. We've been doing this so publicly for a long time.

Yeah, they just don't.

Nobody does it.

And I don't know why. It could be ego. Like, I don't, you know, you feel especially as a trader, you know, you want to have your own system. Yeah. Another thing that they talk about with that is people feel like if I'm a money manager, I need to make trades. So the idea that you would sit for a year and not make a trade is like, no, I make trades, even though it might in fact, of course, be the right thing to not make a trade. Yeah. Some people have the discipline to do that, but most don't. And is it just emotional? Maybe. Or it could be real. It could be that you're that your limited partners do expect you to make trades, even if they're wrong about that. I'm not really sure. But also maybe you can't. I mean, just like it's hard to change a culture of a company. I mean, these decisions is how every single— it trickles into every single decision in the company, including the culture and the people. So to say we're going to copy that may be literally impossible.

You know, you had a talk that did really well on YouTube Let's say close to 500K views or so. And let me just ask you, how do you— it's a loaded question. How do you go about designing the ideal bootstrapped business? And you can just give the principles. You don't have to go into that whole hour talk.

Right, right, right. Go see the talk. So really, it's funny. It actually is a series of things like we just said where the constraint is it's bootstrapped, so you don't get money until it comes in and you can't spend it until then. And so what should you do to try to make that work? What are some decisions that make sense? Obviously, they're not rules, laws of physics. You don't have to do them all. I just feel like each one makes it a little easier or de-risks it a little bit. That's why I think in aggregate it's pretty good. So like, like I'll just give 2 examples. One would be if you have recurring revenue, which is of course a good idea because you know how much money— oh wait, let me just say why that's good. It sounds like it's obvious because, you know, You know, but I think right now there's a big push towards maybe don't do that. Maybe one-time revenue, which I think is a terrible idea.

37signals.

That's right. It's a terrible idea. One reason is tech support. Yeah, that's a whole topic. But one reason for bootstrapping and when you're getting started is it's so powerful to know how much money you're going to make next month, to have to start over, as it were, next month and hope is the difference between being able to quit your job or not.

Mm-hmm.

That's a huge moment, a huge difference. So it's not just about the finances. Of course, that's a good enough— that is a good enough reason to do it, right? It's that to know that that's coming means you have the confidence to really dig in and invest in the sense of things like quitting a day job or reducing work, especially if you have a family, but even if you don't. So I think it is more powerful than just the math. Okay. Let's say you're going to do recurring revenue. I think one thing people do wrong a lot is they don't deliver value in a recurring pattern as well. And so it'll be something that happens today. Event planning is a great example. There's a lot of like event software and then it's monthly. It's like, but that person may put on an event once a year. So what are you charging monthly for? They're like, well, I just heard recurring revenue is a good model. It's like, it is, but you're not getting it. You know, that never works. And so what they do is, and you can see this on Twitter, you can watch people say this, here's how you'll know. is they'll say, yeah, I have $2K in MRR, but my churn's a little high, like 20% per month. I need to work on that. You're like, work on that? That means it's not recurring revenue because half the— half of the people aren't even here in 4 months.

Yeah.

Like, what? That's not a— yeah. So, so what are— so one of the things in the talk is like, so what things recur? And just think about business processes that happen either continuously is even better, but, you know, monthly. So like anything in accounting happens monthly. So almost anything there, That probably makes sense, right? Or anything that people use as part of their normal workflow. Marketing analytics. Well, there's some marketer who's looking at that thing every dang day, so it totally makes sense to keep charging them for it, you know? So, I mean, perhaps again, that's maybe obvious in retrospect, but just you've got to be asking how in month 6, in month 30, is the person still getting more, more and more value, maybe even, even more value? That'd be even better, you know? But how is that actually manifesting? You better be able to answer that. That was an example. Another one is annual prepays. So again, it could be— should be kind of obvious if you ask for— usually there's some kind of discount, right? So you pay— it's like pay me for a whole year upfront, but I'll give you 2 months free or something like that, right? So it's 10 times as much as monthly, but once a year. Okay. Many products do this. I don't think people appreciate just how powerful and transformative that is. For a bootstrap company where you don't have money until it comes in. The fact that you get all that money today is so different. So here's an example to see why. So let's say you were going to charge— let's make the numbers really easy. You're going to charge $100 a month, so you're going to get $100 a month. Fine. Instead, though, someone opts for your annual prepaid, 2 months free. So they give you $1,000. Now they're not going to pay you again for another year, but you got $1,000 now instead of $100 a month. Now overall, you have less money. Okay, I know, but you had $1,000 now. But you— now here's, here's where it gets really good. You get that $1,000 today or tomorrow, depending on how your credit card stuff clears. When you pay for AdWords, when do you actually pay? Well, you get a bill and then it goes on your credit card, which you then pay off. So it gets— you pay that in, let's say, 1 to 2 months from now.

Mm-hmm.

But you got the $1,000 today. So if you spent all $1,000 today on AdWords and even one, you know, let's say $1,000 of AdWords, even one person from all that signs up in the next 30 to 60 days.

Yeah.

Then you've paid for that kind of for free.

You've liquidated the ad costs.

Yeah. You've liquidated that in.

Yeah.

And At $100 per month, you couldn't have done that because you didn't have the money, right? If you get even one, then that means you're ahead. If you get 2, if you get 3. So whatever your conversion rate is, as long as your conversion rate is positive, if it's not, then obviously don't do that in the first place. But supposing that's a profitable channel, how much money can you spend in that channel? The answer is infinity. I mean, it's not infinity because the channel has a limit of what you— but the answer is it's not limited, right?

Right.

Because you'll get the money back before in cash before you have to pay for the marketing.

Yeah.

So you went from a marketing budget that was limited to $100 a month or less to unlimited marketing budget for as long as the channel is profitable.

Mm-hmm.

What? So like, that was not obvious when I first said annual, right? So I don't think people appreciate just how transformative it is to get the cash upfront, what that can mean in terms of the business. So that was— that kind of stuff was in the talk.

Yeah, I mean, 10 years ago, that was probably game-changing for everybody, and now it's like common practice, right?

It's common, and it wasn't uncommon then either. I just think, you know, maybe people weren't yapping about it as much.

Exactly.

I don't know, but, you know, all these things in retrospect ought to seem obvious. Like, you know, it's not like, oh man, this is a new— you know, you discovered a new particle. No one saw that one coming. No, no, no, these are not necessarily— the point isn't to make it as obscure as possible, But rather just if these are really good ideas for someone who's bootstrapping, then they're really good ideas.

Like, great.

And so again, as we just said, you know, you could make another case, right? So they're not laws, but certainly they're worthy of consideration because, you know, maybe probably cherry picking some of these, probably a good idea.

Got it. Yeah. Now when I think about it, you can choose either a SmartBear or a WP Engine. At what point did you decide, okay, you bootstrapped it to a certain point, now it's time to Raise? Like, what was the stage? And yeah, timeline here.

At SmartBear, I never did raise. It was just bootstrapped. At WP Engine, it was, it was what I said. We were about 2 years in. The unit economics were really good. The market was bigger than I thought. I mean, WordPress at the time was already 10% of the internet, and that was easily accessible numbers from W3Techs. It still is. I mean, the numbers are still— now it's 43%, but okay, the same sort source. And 10% of the internet's already infinity if you're a small company. Yeah, but also it was growing. So it's like, okay, large and growing market. The demand for it was way higher than I thought. I was thinking people like me, bloggers, etc. How big is blogging? I don't know. I mean, at the time, you know, it was okay, but WordPress was really winning in corporate homepages, not just blogging, and starting to win in media. Okay, wait a minute. That's, that's, you know, that's a lot, which kind of makes sense because 10% of the internet even then was not blogs, right? Like it was— that's got to be other stuff like corporate homepages because, you know, so again, like it was, oh my gosh, it's just, it's so much bigger and broader than I expected. And then I wanted, you know, again, personally, a different journey, as I said. And so it was those kind of considerations. And even then, the first round was just $1 million.

Mm-hmm.

I mean, nowadays that's, you know, so little to think about, right?

Yeah.

So it wasn't even that much anyhow. And that was another thing I did all along the way. I say I, and then we have many other people, but we is along the way we always raise money at a fair valuation, by which I mean not too low to where it's diluting the operators too much and we're not getting paid for what the company is, but also not too high where we get over our skis. And if we don't, Do insanely good, then we you know that we won't grow into that and blah blah blah. We never did that. We were it was always this very reasonable thing given our given our size and and growth rate. It was like this was really in fact fair. Like that's what I think is actually fair or reasonable or logical whatever.

Yeah.

And so you know the past fourteen years we've had all kinds of economic conditions and things and and we've always been able to do okay there because it's always been oh this is a company that's doing really well financially. and the valuation makes sense. It's just always been that. And so that was really smart. So even in that first round, that was the case as well. So it wasn't until years later where we started getting into the really big rounds. But even when we were raising things like hundreds of millions of dollars, yeah, our ARR was also 9 figures. And so again, like, that's not, that's not a crazy— if you're raising about what your ARR is, that's not, that's already not crazy. What value is it? I don't know. But like, that's not a crazy amount of money.

Yeah.

going to pull in that, that amount of money this year. So that's actually not pulling in that much more money compared to what's going on.

You know how the bootstrappers— I mean, both sides actually speak in absolutes. Oh, you know, bootstrappers, you know, control your equity. Nobody's there to tell you what to do. But also at the same time, it's kind of like a— it could be a helpful forcing function to get you to think differently.

Right.

So what's your perspective?

Yeah, it is. And so, so as a bootstrapper, you can say, okay, I want some kind of accountability, but I sure as hell don't want that to be someone who literally controls what happens to my company. Okay, so what does it look like to have accountability but not control, but have someone else provide you with accountability but not take control? Yeah, lots of ways. Some people do it by posting things on Twitter. I'm going to do this, I'm going to do that. So it's sort of like the— it's sort of like saying I'm going to go to the gym and lose weight and posting your weight all the time, you know, like that. Okay, so there's that kind of public accountability. That's okay. But honestly, like, does that really hold you to account or do you just go, I decided not to, right? So I don't think building in public is actually that accountable.

Yeah.

Probably better is some sort of group. Okay, I got together with 5 other people who are like-minded. We meet often enough and deeply enough that we understand enough about each other's businesses that we can really help each other think through things. But we're still from the outside, which is good, Because sometimes getting that outside perspective is what you need because you're in the middle of it. So just like an author cannot proofread their own stuff, they need an editor. Not because the author is no good at writing. In fact, the author might be better at writing than the editor in some sense, you know, but you can't see your own stuff. You need an editor. So, okay, so you have like your group where you can be each other's editors, except nobody there, of course, has any control. Obviously not. That's probably more like the right kind of accountability and also just camaraderie.

Yeah.

Like just having people that understand, you can vent at. That's probably good.

That's like a YPO, EO, Hampton.

It's like a YPO. Yeah. So you can like join one of those or make your own. I'm not saying those are all easy to do, but these are all ways to create accountability and not give up control.

Got it. And then so you don't— well, 2 questions here. So it definitely doesn't seem like you regret raising the money. You got to move a lot faster. You got to build the team that you want to build. So that's not even a question. The question is more so, At what point? Because you don't have control anymore, right?

Well, I mean, I don't know. What do you mean by that?

So what I mean, but like over 51% of the company.

Well, see, I mean, it's interesting. Like even when you sell 5% of your company, you already gave up control of certain things. Like you can't just sell the company if they— if you give it 5% with preferred class of stock, you already can't decide, for example, I'm going to go sell the company. Yeah. So it depends what you mean.

Like, what do you mean, like super voting rights and all that?

Occasionally, you know, again, like people say that because in the press when that happens, it's so weird and so special, so odd that it gets press. So people are like, that's what happens.

Yeah.

No, it happens like literally 1 in a million of all the companies that are public. There's not a million companies. Like, how many is that the case where like Zuckerberg can do what he wants? Like, well, actually you can name them on one hand because It doesn't happen. So, no, that's not how it works. When you raise money, you give up certain kinds of control. The kind you give up depends on the terms and the bylaws of the company. So you hate to say it depends, but it actually does depend on what you wrote down.

Yeah.

You know, so, so like we— I mean, generally, quote unquote, the board decides a lot of things that are around governance and big issues of things like, you know, investments or selling, you know, this kind of stuff.

Right.

Or big acquisitions or even big expenditures. A lot of times it becomes a board-level thing if it's over a certain amount. So, or for example, a common one is before you get into a lease that's longer than 1 year, the board has to approve. Why? Because it's this long-term liability.

Right.

Okay. You know, and like, that's part of what it means to have governance is like, okay, we're going to enter into a long-term liability of any kind. Well, any kind, some threshold, you know, then, then just good governance means the board needs to be the ones to approve that regardless of stock like that. That's not a stock question. That's a board vote question. And then there's also stock. So there's lots of kinds of control. So we gave up, we gave up certain kinds of control in that first million, you know, and gave up a relatively small percentage of the company.

Yeah.

So yeah, as more money comes in, bigger things, do you give up more control? That's probably true because there's more governance and more, more things like that. I mean, even things like auditing the finances and other kinds of rules you add on on purpose, right? Because if you have— we have, you know, 1,200 employees, we have lots of money going in and out, right? Everywhere. It's like you got to have some kind of controls and stuff in place. There's no way you can manage that. Right. And so of course you're going to have less control, quote unquote, you know, in certain ways, like just, just practically speaking as well. So it makes sense that the bigger the company is, There's got to be more governance both by the operators but also by the board as you get more sophisticated that way.

Right.

Also, as you get bigger for any company, well, at any time in a company, you can ask what can the future hold? What kind of optionality is there in the future? Do you stay independent forever? Do you sell someday? Do you, do you go public someday? Do you do private equity things someday? You know, there's, there's certain things. The bigger you get, the fewer options there are. It's just so like at our point, at our size now, it's not like there's, there's 100 different ways it could go.

Yeah, right.

You're going to stay independent. You're going to do some kind of, you know, large investing like PE, you know, you're going to go public. Like, that's one of the things you're going to do. Like, there's just— you could get bought or whatever. You know, these are the, these are the options. But if you get bought by whom? Oh, it's a short list because you're this big. It's the only people who can do something this big. Okay. So Or some other kind of thing like a, like an investor who rolls up several things. So whether you want to call that being bought or whether you want to call that PE, I don't care. But, you know, it's another like type of thing. In every single scenario, the best thing we can do today besides building a great company, period. But the best thing we can do is to operate like a public company. So we get audited at the public company standard. We do all the books, all the things exactly like that. And we have for like At least 5 years, but I want to say 7 years, maybe more. It's expensive and difficult, and we've been operating that way. Why? Well, obviously, if you were to go public, what's the best way to prepare? By having operated that way.

Like that.

And so there's no change at all in terms of how you operate when you go public. That's great. That's the least disruption to the company is we already, we already did that transformation in a timeframe that was— we could, we could consume. You know, so there's no moment and now we have to do everything differently like that. Just, that just doesn't happen because we've been doing it. So that's brilliant. But also, let's say you're going to get bought by what? Probably a public company. What do they want in due diligence? Oh my God, if all our books just fit into the, you know, and PricewaterhouseCoopers or whoever has been stamping this for the last 5 years, what does that mean in terms of due diligence of a very complicated company? It's, it's the best possible scenario you could put yourself in. It de-risks it the best. So this is just a long way of saying, hopefully this is interesting, but it's just a long way of saying operating like a public company is the right move regardless of which thing happens. And so we have been. So again, you could say, but that gives up some kind of control because there's all these things you do. It's like, I know, but like, it's just kind of smart at a certain size anyway. So, you know, So it's a, it's a really interesting question, that of control. And I'm not trying to, I'm not trying to evade it or be like the philosopher and says it depends on what you mean by control. But it is, there's all these interesting different ways in which, you know, your freedom to operate the company this way or that way definitely like closes down as you scale for these very practical reasons.

And that's where I'm coming from, because I think if you look at the Twittersphere, again, coming from the bootstrapper's perspective, right, the absolutist, it's like, Well, you don't get to operate, you lose your freedom, you don't get things to, you know, but it's tradeoffs at the end of the day, to your point.

Yeah, you do lose that. And so like if you say, I don't want to do that, that's totally rational to say I don't want that. Good. Then don't make a big company. Again, they just go back to what you said. Then don't make a billion-dollar company. Yeah, I'm with you. Just don't, don't say I never want that. And also I'm going to make a billion-dollar company. Those things don't go together. You know, that's not a consistent strategy right there.

You know, SmartBear, how long did you compound that company for?

I started it in 2002, sold in 2007. So it's like, but like it was February 2002 and December 2007. So I always say 6 years because, you know, you sold it for 9 figures, single-digit millions. What is that, 7 figures? Yeah.

Got it. Got it. By the way, Neil and I have an agency owners group called the Agency Owners Association. All you have to do, just go to marketingschool.io/agency. Once again, it's marketingschool.io/agency. To learn more. And now back to the show. And then WP Engine. So just to clarify here and then we can move on. I think what you mentioned was, hey, like you built it for 2 years. This is cool. And it was mostly you, right? And then you got it to maybe $30,000 to $50,000 a month in profit. Is that what it was?

Yeah, we— when we raised money, we had, I think, 4 people. Might have been 5. Yeah, something like that. 4 or 5.

Got it. And you made the conscious decision, hey, I'm going to go raise right now.

Yes.

Yeah. Nobody came to you.

So the reason I'm pausing is as part of Capital Factory here in Austin, which is a— at the time was strictly an incubator. Now it's a lot of things. It's coworking, it's, it's investing. There's lots of things that go on. At the time it was, it was like a Techstars-style incubator.

Yeah.

And I was part of that when it launched in 2000. 9. And so I was around investors and we were always talking about this kind of thing. So in that sense, sure, there were people saying like, oh, you know, this seems to be working, can I put in money? So like, yeah, but not like a— it's not like, oh, Sand Hill Road folks were showing up trying to put—

Sequoia's here. Yeah, yeah.

No, no, no, not that. But there were people, but it was like this low-key way, if that makes sense.

Got it.

Got it.

Yeah. Yeah. Well, there's a whole thread we can tug on there. Maybe I'll come back to it. So, you know what's interesting? I remember investing in this company called Levels, and it's that continuous glucose monitor. And I was— the CEO called me too. And then all of a sudden I realized it was a 45-minute call, like maybe like 20 minutes. I was like, oh crap, I'm on a customer development call. And I was like, hey, how many of these have you done? He's like, about 4,000.

What?

4,000, right? And so I remember you did a, you did a little pod with—

4,000?

4,000. No jokes, 3 zeros. And so—

That'll take 10 years.

I don't know how he did it, right? But so how did, how did you customer develop your way into your 10-figure company?

Yeah. So this I've written about. So for folks that want to like get every detail and copy the method like in detail, they can go— I'm obviously not here to promote anything, but—

SmartBear.com.

SmartBear.com and look for customer development and you'll find it. So at SmartBear, I didn't. I stumbled and found my way in. Half luck, half— yes, I listened to customers, but I wasn't being proactive. And so it was definitely luck that I stumbled in. And, you know, and I also wrote about that as well, how that, how that happened and how WP Engine was different.

Yeah.

And so by the time I got to WP Engine, now you have to keep in mind Lean Startup had not even come out yet.

Eric raised it.

Like that book was 2011. I was doing interviews about WP Engine in 2009, right? So like all of that kind of stuff that now it's— we just take for granted and it's in our nomenclature. None of that existed. So the idea that I would go do so-called customer development, no one was saying that, right? Like I say, no one actually take it back a little because people like Eric and some others were starting to say that before the whole book came out. Like that movement was just starting.

Okay.

It was that level of like, you know, and so I didn't— we didn't have that word even.

Mm-hmm.

So the way I thought about it at the time was I think I understand stuff about the customers, their life, the context. I think I understand. But how would I go find out? And I thought, how would I do this in like an experimental way? Because I know that I know what the answers I want are, and if I'm not careful, I'm just going to get the answers I want to find. How do I get myself out of that? How do I undo that bias? Of course, we all have, especially with our own products and ideas. Never want to hear no about that. So how do I remove myself from that? Right. So I thought, okay, I'll do it sort of like an experiment. And this did work. And I continued to use this for 14 years. So, okay. And so first you did. So now it's more refined than it was at the beginning. Okay. So first you decide like, what is it that I'm trying to learn from these calls? Because it's not a sales pitch. You could sales— you could make a sales pitch for 45 minutes at someone and hopefully you can beat them enough that they would say, I'll buy it. But you haven't learned one thing, have you? And plus, that's not how you can sell your product anyways. That's not a good example of what sales will be like. So you learn nothing. Totally useless. So what are you trying to do? You should decide. And in this post I have like 20 things you could decide, maybe all of them. But there are things like, what is the life of my customer like? What are their problems really like in their words? What is it really like? What tools do they use now or do they do things manually and how does that work? Do they have a budget for this?

Really?

Like already allocated? You don't have to go beg. What is— what is that budget like? Does there— is it named something that you may not expect? Are there different kinds of customers where this one doesn't have one? This one does. Where do they go today to buy tools like this? Is it this podcast and this website that they look at? You know, because you're going to need that when you do marketing, right? You know, where the hell are these people? You know, so ask them, what do you read? That kind of stuff. At SmartBear, you do magazine ads, believe it or not, because people would read them then. Certain ones.

Yeah.

Okay. So, so there's more, but you get the point. Like, what am I trying to What am I trying to suss out here exactly? Here's another great one that I stole. I stole from Bob Moesta, another great thinker in customer development, of course. So one thing I stole from him was, no, who wakes up in the morning and says, today's the day I'm going to buy new WordPress hosting?

Nobody.

But sometimes they do. Why? What's up? What is happening? What is going on that day where they're like, that's it, throwing something out on the table?

Yeah.

We've got to change. Whatever that is, you've got to find out what that is, because otherwise you're just yelling ads at people and it's like, that's not what they wanted to do today.

Yeah.

What's that? So for example, one of the ones that was for us, it turned out, was I got hacked. It's such a painful thing. You feel violated. You are. You probably didn't even know you were hacked for a while. Who even knows how you found out? You fixed it. That costs a lot of money because it was some kind of last minute, you know, expensive thing. Like you call a plumber.

Yeah.

And they— yeah, you're willing to pay anything right then, right? You know, same thing when you get hacked, then they fixed it. Is it— aren't you scared from now on? At that moment you're like, I never want to go through that again. If I pay $50 a month instead of $5 a month for hosting and that never happens again, that's totally worth it. You're thinking right then. So that's an example for WP Engine. There's a couple others. That's an example. So that's a Bob Moesta idea that I like. Okay, so what are you— what are you trying to figure out? Then you write down next to that, like in a spreadsheet, what is your hypothesis of the answer to all those questions? I just told you one for security. Okay. So, you know, everything like we were talking to people who like agencies who build sites. So how many web— I wanted to know things like how many websites they build a year. I thought, I don't know, maybe it's 4 a year. Just, you know, just writing down like, what do you think?

Mm-hmm.

Then question, what could you ask that would get the answer to this, that would validate or invalidate this hypothesis, that would, that would suss out the answer to this thing where you're not leading the witness? So you have a chance to think. So for example, what you can't ask about security is Okay. You know, the internet is a scary place. Hackers are everywhere, always coming at you. What do you do with your clients to keep your site safe? And how much money do you spend on that? Obviously leading the witness to think security is really important and that they would spend money on it. Terrible question, right?

Right.

So, no. How would you not lead the witness? Just simple things. What do you think about internet security? How much money do you spend on security? What do you buy? Just like super open-ended questions so that whatever the answer is comes out.

Right.

And so you write those, those questions down. This is what you're actually going to ask. So then you do that, you start to get answers. And of course, what happens is some of your ideas are correct and some are not. And then there's this third category of stuff that appeared that you didn't even think about or, you know, new stuff. Good. So as you make these things, you're adjusting your hypotheses. But see, now you can do it more clinically, right? You're adjusting your hypotheses. You're adding new questions and new ideas because stuff is coming up and so on. Now, people are different. It's not like you're going to hone into one answer everywhere, but you'll get a better sense of like, look, half of the people I talk to do this, or I've discovered there's kind of two kinds of people. There's the this kind and the that kind, and this kind say blah blah blah blah blah, and this other kind da da da da. What are you going to do with that? I don't know. That's up to you. Maybe you want to focus on only one, or maybe I don't know, right? But You start learning this stuff and it won't be— it's not— it's also not perfect. It is not, in fact, science. And there is not exactly one answer. So what happens is over time you do enough of these to where you're not learning anything anymore. You can tell because you're just never surprised. You're just like, I've heard that before. And that's when it's time to stop. Not because you know everything, but simply because this modality of learning is not working anymore. It's just kind of run out. You've got to make this stupid thing and you've got to do something else. Like make it and ship it to learn now. So it's time to do something else. So how many is that going to take? Not 4,000, but not 3 either. Like 3 is probably not enough to know, right? So at WP Engine, I, I did 40. I did— I tried 50. I really talked to 40.

Yeah.

30 of them actually became customers at, you know, during like before launch. So like I launched, like officially launched with 30 paying customers.

How much are they paying?

$50 a month. That was our lowest price at the time. We later lowered the price.

Yeah. You actually— I think this is a tweet, but you tweeted out, maybe it was a blog post, but you basically wrote something saying that if it takes you longer than 4 months to get your first paying customer, you're not shipping.

Yeah. And as usual, like—

You're not serious about shipping.

Yeah. And as usual, you know, some people say 2 weeks, some people say, well, about 4 and a half months. So obviously, The point being, there's people who have been working on it for 2 years, still don't have a paying customer. What are you doing?

Right.

But there's a lot of people that do that. And the answer is they're doing a project, saying they're doing a company. Right. The difference between a project and a company is that there are customers. So if you don't have those and you're not working toward those, then you're not making a company. Right. Of course, you could argue things like, well, my project's super complicated. And hard. You couldn't make a V1 even that's a little bit weak and a little bit this, a little bit that, unless... You could say that. What I would then say is, well, then you have a massive amount of risk and that better be worth it. Can you explain why that risk is worth it? So you could say, because if it does work, it's going to be huge or it'll be super profitable, or I don't know, other reasons. Maybe you already have other things de-risked. For example, maybe you already have this huge following on, on, on Twitter. And so, you know, you can sell the crap out of this thing. So it's better to wait and make it really, really good because you have a reputation to uphold and you know you can sell the piss out of it.

Yeah.

So yeah, I am going to go underground for all this because I know it's coming. I mean, no. All right. It's heavily de-risked. That's why. Well, that's a dang good reason. All right. You win. You know? So I would just say, like, it's so bad to wait. You don't know anything. You're working on it too much. Or maybe you're right. It does take that long. So that's the wrong project for you because you're just on your own and this is too hard for you. This is just— this is a— this is a project that requires a team and you're not a team. So bad fit. You know, it could be it. So probably this is a bad fit. You're making some decision that's wrong, probably. But you could imagine You could imagine a scenario where it's right.

Right.

But most people, I think if you're, if you're working on it for a year, for most people that is wrong.

Yeah, yeah, yeah. No, agreed. Yeah.

By the way, WP Engine I made in 36 hours.

But you're technical, right? Yeah, yeah, yeah, yeah.

But it's a technical product, so it's a good fit.

Yeah, yeah, yeah.

If you're not technical, you're not going to do that. Also, if you're not technical, how technical should be the product that you built?

Oh, you know, that's interesting.

And the answer is not very technical because you're going to have to just hire people.

Right.

And you won't do that very well Because you're not technical. I can't hire a pancreatic surgeon and somebody who's not technical can't hire a good developer.

Right.

So you're going to have to get away with whatever. Therefore, the product had better be pretty easy to make. Again, you could argue other ways. I'm just saying this is the most straightforward conclusion.

Well, I'll give you one example that supports that, one that doesn't. So one example that does support it. So I'm doing GaryVee on the pod tomorrow back in L.A., but that's a Perfect example. He's not non-technical. I'm going to build agencies, right? Yeah. Same thing for my podcast co-host. The same thing for me. Now, on the flip side of that, the counterexample is Jason Fried. Not technical.

That's not a counterexample. He had technical co-founders.

Well, he has DHH.

Yeah, but he invented Rails. You think he's not technical?

No. Jason Fried has said on My First Million, I believe, that he's not technical.

I know, but he had a technical— he had 3 co-founders that were technical.

I didn't know that he had 3 co-founders that were technical.

And DHH invented Rails. Yeah, you couldn't be more technical.

So of course.

So no, that's a great— that's exactly what I'm saying.

So if you do need a co-founder that's technical, of course. Yes.

That's the other way. So if you're solo and you're not technical, then don't make a technical product.

That's what I wanted to—

But you just said, well, what if your co-founder is so technical that they invented Rails? Like, they make whatever. And by the way, they didn't make whatever. They made software that's perfect for Rails.

Mm-hmm.

They didn't do WordPress hosting where Rails is ridiculously bad.

Yeah.

If they had, that would have been a mismatch again.

Really?

But they wrote— but they wrote, you know, as Joel Spolsky once said, text in boxes.

Yeah.

Which is ironic because then he did Trello, which is also text in boxes. So, haha, joke's on him, I guess. But yeah, they wrote really simple CRUD software, right? Where Rails is perfect at CRUD software. Yeah. Perfect match.

You play any Dungeons and Dragons?

When I was a kid, I did.

EverQuest or anything like that?

No, when I was a kid, like in the, I guess, late '80s, early '90s, I did.

Because here's where this conver— like, this is why I asked the question. It's like, you know, you play to your strengths. Like, you might be like, you know, a warrior or warlock or a paladin or necromancer, right? Like, just play to your strengths.

Of course.

Yeah.

Well, isn't that obvious when you say it? Yeah. But it's hard for us to do.

Or you could go back.

You know, a lot of people like to go back to Art of War, right? It's it's 2,500 years old. There's a whole there's only five books or chapters, whatever you call it, or you know sections. A whole whole one of them is devoted to this concept.

Yeah.

And there's a whole like strike where the enemy is weak and not where not where you're weak. You know, blah blah blah. Like no shit. Like this is not a complicated concept. And yet it is actually pretty hard to take stock in what is actually my great strengths. Yeah. What are my gaps and weaknesses? And then how do I make these other decisions around them, as we keep saying, because that's how I like to think about strategy, that leverage those strengths, because that's, that's going to make me more successful. I'll be able to do that better. So whatever decisions I make, I better be aligned with that because I will be more— me personally, I'll be more successful in that way, you know? Yeah. And same weaknesses. Like if I can't write code and I don't want to partner up, then don't freaking, you know, come on.

Or partner up.

Yeah, it's no problem. Just don't do that.

Just do this other thing, you know? Yeah.

And that, that is part of how to make a good strategy in a simple, straightforward— I shouldn't say simple because it's not easy, right? But let's say in a practical way that makes a lot of sense and isn't like the academic strategy nonsense. It's not SWOTs and stuff like that. Just as simple as what I just said. Right. That makes sense, though, right? Like, you should do that.

So, Jason, what do you think? And this is not advice for anybody. This is just your experience here. But how long did it take for you to figure out what your true strengths and weaknesses are?

Oh man, decades. I mean, some things I knew, like I was good at writing code, that I knew, right?

Yeah.

But some of the other things, just a long time. Also, you do change. I'm quite different now than when I started WP Engine.

Yeah.

Some of my core strengths and weaknesses are the same, but some are legitimately different.

Yeah.

That means you're never done finding out what your strengths and weaknesses are. So, okay, so you have to be introspective and maybe there's some guiding questions to help surface because again, it's really hard to just sit down and go like, what am I good at? Like sometimes, I mean, you can do it a little, but it's hard. There's a couple of ways to do it. One way that's really eye-opening is do a 360, which is a kind of a big business term, but it is actually really good, which essentially means someone else, some third party who's good at this essentially interviews all kinds of people around you at a big company. That means people report to you, your peers, people you report to, and so forth, and kind of collects this whole thing. And it's questions like strengths and weaknesses, but also usually there's a whole bunch of stuff around your capabilities, the culture of the company, depending on your role. It's going to be stuff that's role specific. So for me and for any executive, there would be like executive type things such as How do you do change management, leadership questions, strategic questions, operational questions, and so forth? And but also personal stuff and interpersonal stuff. And they compile this thing and they— so that you can't tell who said what, you know, because it's a third party. And then you get this dossier. It's eye-opening because some things you're like, yeah, yeah, I knew that. But still, it's nice to see in black and white. But you will find things both good and bad that you did not know. And the stuff that's good that you didn't know, that's to me the most interesting one.

Yeah.

And often you think, you'll think something like, they think I'm good at that? No, not at all. But the reason you think you're not is because your bar is so high. You're so good at it that your personal bar for it is so high that you feel like you never reach it. But that's exactly why you're so good at it, Because you've been reaching your whole life and you probably have some sort of talent and skill at it and you've been working at it. That's why your bar is so high there. So you're actually up here. You think it's not good enough, but everyone else is here going, you're so good at that, right? That's why you didn't see it in retrospect. You could often go like, oh, is that true? Well, okay, cool. I mean, that's cool. There's your strengths that you never knew, right? So that's why this is useful. And weaknesses also, of course. But like, that's, that's why. There's also some guiding questions. I have another— I have another article. If you look under fulfillment, you'll see a whole bunch of stuff about that. And at the very bottom of that is exactly this, a whole bunch of kind of probing questions to get you to say, what are my natural strengths or natural things, as well as probing for the reverse. And some of them are, you might say, obvious things like if you— if you're away from work for like 3 weeks, what do you just do? When you were a kid, what did you just do? Those may or may not still be the things you want to do now because you change, right? But they're good questions because maybe, you know, so there's a bunch of them. Some of them are less obvious than that, but it's that kind of thing. We're just trying to get a little bit out of your, out of your normal modes. And again, fun idea. Take whoever knows you the best. Maybe you have a spouse. a kid if they're old enough, or people at work or just friends and give them those questions.

Yeah. Yeah.

And say, like, answer this for me and then you do it and compare. It's sort of like the 360 idea. Pretty neat way to try to be introspective. Yeah, but I know I'm going on and on about this, but this is how to be— how to get the best strategy for your product company because of the reasons we said. Right. And the best way for you to be fulfilled, happy, maybe. But that's another topic. Yeah, but maybe fulfilled in the sense that you're doing something that you're genuinely good at that is a good fit for you. That also the company needs to have done, maybe that you even like. And if you can be in that spot, that's freaking powerful. Of course.

Right.

So I'm going on and on, but like, this is life. We're building our life. Why be an entrepreneur at all? Well, to make money, maybe because it's impressive, maybe to prove others wrong. I mean, I had a lot of that for sure. Making money was one of my biggest ones. Not anymore, but that's because I'm way in my career now and have made some, so I don't need to make more. So, so of course my goals change. I mean, at first it was absolutely I want to make money, no doubt about it. And ego, you bet. It's as crude as that. I mean, it's not to change the world. It's— no, no, it wasn't. And I, and I was honest about that then, too, you know? So that's fine. But surely one of the reasons is because we want to build a certain life. And I don't mean lifestyle company. I don't mean that. I mean, just you're in control of stuff. Good or bad, you know. You, you, it's yours, and you, it's not a regular job, and no one's telling you, you know, and you're building some kind of life. And so if you build a life that you don't even like, if you don't even like coming to work every day, what do you, what did you do? Like, well, maybe it's to make money. Okay, maybe, but surely you failed in some sort of personal sense if you built something that you then hate.

Yeah.

Which I feel almost everyone does do. I did it at SmartBear. I think it's really common when I talk to— I don't have data, but when I talk to founders, especially after they sell, are they happy or sad after they sell? Always sad, right? And we shouldn't have sold. No, I was unhappy already. It's the common response. There is a little bit of studies, but they're not a lot of N, so I don't count them as like data. But every study that I'm aware of concludes the same thing. So while that's not maybe data, I mean, maybe, right? And so So dwelling on this thing of like, who are you really? What is your real strengths? What are you really drawn to? It both creates a better strategy for success at all and staves off or helps this issue of burnout and fulfillment and stuff like that. So I just feel like it's a really important topic. It's not all emotional and woo-woo. It's very practical, both for yourself and also for the strategy of the company.

Yeah. This message is brought to you by Single Grain. Single Grain is a marketing agency ran by yours truly. Single Grain does paid media, SEO, creative, conversion conversion rate optimization, and has worked with a handful of companies such as Uber, Amazon, Airbnb, Salesforce, to startups, venture-backed startups, a lot of different companies. And ultimately our mission is to do innovative marketing that drives customers. If you wanna learn more, just go to singlegrain.com. Again, it's Single Grain, grain like wheat, and we'll see you on the other side. While you take a sip, there's a couple threads I can pull here. I guess were there going from, let's say, $1 million ARR to who knows what the numbers— I'm just going to make up a number, $400 million ARR or something, right? There had to be moments. You can say no as well, but there had to be moments where you felt like, screw this, or I'm burnt out. What did you do in those situations?

Yeah, exactly. So at SmartBear, that's exactly what happened. And I did burn out and I sold the company.

Which is not ideal. Well, maybe it is ideal because you— I don't know.

Yeah, maybe it is ideal, right? Because I mean, one way or another. Okay.

Yeah.

So I knew that going into WP Engine, so I had a different take. So yes, of course you go through waves of stuff. So several things. One is I realized about 4 years in, oh, I'm not going to like being the CEO of the company as it continues to scale. We had like 50, 60, 70 people. It's like, wait, wait, wait, wait. I like the tech and engineering stuff. I don't like not only managing a lot of people, but also we need a global sales team that we need to build. We're going to need global offices. because this is before COVID obviously.

Yeah.

And the support team is really getting very big. So we need a lot of ops there. And oh my gosh, like, I not only don't— haven't done that before, and the company's growing so fast that we don't have time for everyone to learn on the job when it's growing super fast. I mean, we were growing very fast. The company needs someone who isn't learning on the job in every single area at once. And I don't like that. So that's a bad combo. You could argue, well, if you loved it, you could— what you would do is you would build an executive team so that together you're doing it. But if you also don't love it, well, you still need to build the executive team where together you're doing it, except you just said you don't want to hire and manage the executive team to do it. So that means you shouldn't be the CEO. So that this took 4 months, by the way. I'm saying it like it's so obvious and easy. Of course it's not. It took me 4 months of struggle to get there. And this thing that I— this This article I mentioned, I described there how I came to that conclusion over time. The fulfillment one. The fulfillment one, right? And so on. So that I walked the walk there and that's what I did. And that prevented the burnout there. And that's right now. But that doesn't mean I didn't go through waves and have it anyway. But what it meant was it was much better. It took more time. It wasn't right away, you know, all this kind of stuff. Another thing is I talked about it. So like I would talk to the CEO when I, when I When I was feeling worse, I would just talk about it. I would, I would get out what's in that article. Like, again, I'm walking the walk. I would get it out. I'm like, okay, see, I'm not feeling this, that we talk about what can my— how can my role change over the next 6 to 12 months so that I'm back into a healthy place? And what would that mean? And we talk about it, figure it out, we do it. So I've had like 5 titles or something over the 14 years, maybe 4 at the company. Yeah, because I've changed because of this.

What were those titles?

CTO, running all of product and engineering, etc. And then just product, and then, and then, and then actually just special projects. And then, and then one where it was corporate strategy, which is part of why I like talking about strategy. Yeah. Right now I'm working on our corporate data team. What? That's like, you know why? Because it's a, it's a, it's a strength of mine, data. And, and we needed it. Now we're building up the team so that I don't need to be there. Yeah, but it's helpful and it's a strength of mine and I like it. And so see, that's, that's a good mixture. So and then many other people at the company have used the same thing and have had, of course, their own paths. But that includes things like, I think I want to be a manager. We try it. Oh, I changed my mind. And you go back. Now, how many companies have a culture where that can happen and it's accepted? Everyone's like, okay, see, I'm really proud of us for that. That's beautiful. How many people are like, I got to quit and reset somewhere else? You know? So the fact that you could do that That's a great culture that's really allowing people to explore. And also, as someone on the team, it's a little disruptive to the team, of course. But also you look at it as, wow, this company really lets me have a career that's whatever I want to try and I can even be wrong.

Yeah.

Okay. You know what? It's a little disruptive, but I mean, yeah, I want that for everyone here and myself. So yeah, that's a good reason, isn't it? You know, that's actually— let's go.

Yeah.

So fortunately we have that kind of culture. So I model that by actually doing it. But you also could argue, I'm the founder, I can do whatever. Okay, fair enough. But, you know, here's, here's hundreds of other people who have modeled it too. So it really is true, right?

Right. So, you know what's interesting? So I'll share my lesson and my PTSD also. So, you know, hiring GMs, CEOs in the past, you know, I took from the Twittersphere. It's like, oh yeah, you know, once you hire them, just get out of their way, blah, blah, blah. Right. And it has been a disaster each time that's happened. And I've just learned, you know, last couple of years or so, it's like, sure, hire them. But at least for me, it's like I got to be involved in some way, shape, or form. So did you completely cut off or were you still pretty close, like talking to the CEO that you brought on? Like, what was that arrangement like? Or was it like Dharmesh where it's like, I don't want any people, I'm just going to be the CTO?

It wasn't like Dharmesh because again, I was a CTO and I ran all of product engineering, which is kind of a big deal at a scaling company. So no, it wasn't like that. It was just that there was a clear CEO that's not me. And then— but I own this like any— if you had hired a CTO, that's what I own because that's my title, that's my role. That's what I was doing. It is true that the founder always has a special thing. And I remember I don't need to tell the whole story. Not that it's bad. It's just I was given good advice. Around how there is— the founder does walk around with this invisible hammer. Everything you say is like, you know, and so even just popping by someone's desk and talking or just attending some meeting or just saying something at some point, like it really has an impact. So and that's not true of other roles except maybe the CEO or something like that. And so that is special and you can't delegate that, you know, And so, yeah, there's a little asterisk next to that and for good reason, you know, but that's, that's not normally how you run or think about any other role in the company. But it is true. So, for example, I remember once I was also the CEO at this time who also has this problem. But I remember I was walking by. I mean, it was just like 30 or 40 of us. So we're all in the same room and doing, you know, we're always talking all the time. And I walked by this person's desk and I knew he was in support. I knew he was working on some special project. And so I was like, oh, how's it going with that thing? Just making conversation.

Yeah.

And he goes, oh, I don't use names, but my manager told me to pause that. I was like, oh, okay. And I meant it. Okay. Like, it's whatever. It's paused. I don't care. I'm just making conversation. Move on. What do you think he did as soon as I left?

He went to tell his manager.

No, he went. He started working on that project again. Oh, he just started working on it. And then later the manager came to me. He's like, dude, you can't just go to my people and tell them to start working. I had them pause there for a reason. Yeah, I didn't tell him to work on it.

I said, oh, okay.

But he took that— just the fact that I asked.

Yeah.

Here comes the hammer. He took that to mean I'm telling him that, you know, right? Like, I didn't mean any of that. So again, it's just what you do and say has this weird reverberation that is quite possibly not what you even intended at all or said in any way, especially when it's written and you're like, look, that's what I wrote. I clearly said Hey, do whatever you want. I just have an opinion that I want to throw in the mix. I clearly said in writing in Slack, and over here it's Jason said we had to like, no, no, stop it. You know, stop doing that to me. You know, you're not letting me have an opinion. Yeah, I want to. I want to just have an opinion. Let me just have an opinion and not take control from anyone, please. You know, so isn't that funny? So, so that is true of like a C-level as you go up the org. That is true. But it's Again, it's especially true of the founder. So of course I disagree with the idea of you hire and get out of their way. That's a very like, I don't know, it's just a very— to me, that's what people who don't know how to manage say, and it absolves them of learning how to manage because running away means you're not managing them.

Right.

Good. You didn't learn how to do it. So, but micromanaging is wrong too, obviously, because why did you hire them if you're just going to tell them what to do anyway? You had better hire. You better have hired someone who was better than you at that function, or else the company's not better. Your job as the CEO or anybody really is to hire people that make the company better. That means better than you, even in the areas you're good at. That's also you're still your job. At least there you know how to hire good people. The other ones you don't. So that's a trick. Yeah. But that's your job anyways. And so yeah, that's wrong. So is micromanaging. So what do you actually do? Right. That's why management is hard. It's not easy. It's subtle. So the answers are things like you're not telling them how to do the job in detail, but you are holding them accountable to whatever results you want. Right. And so what is the marketing leader supposed to do? Make leads do this, revenue do that, quality? I don't know. The more there's numbers, that's good because it's objective and you can look at it. But as we all know, not every important thing is a number. So that can't be the only thing, right? There's even things, cultural things, of the people on their team fitting into the company culture. That's another thing you're holding them accountable for, right? Other strategic things they're supposed to be contributing to, like we're supposed to be launching this way or having this kind of brand or I don't know, whatever kind of stuff that's again, not a number, but important that they're owning. Are they making other people around them better? And especially as an executive team, that's, that's mandatory. That's part of the job. If you're a line manager, not necessarily. But as you move up, that's part of what changes is that you start, even though you own a department, as you move up those titles, as you own a department, but what you're doing is making the company successful. So the higher up you go, the more you're looking everywhere, not to tell them what to do, but like we In our executive team, it's always we need to hit this revenue number and we need to, you know, of course.

Right.

And so who— all kinds of things might be given and taken to do that. We're going to give up some budget over here in sales to do this thing in product, not because one equals— not because they're related, but because we are trying to do something and we have a budget and we, even though we of course also are responsible for different departments. So that's just a long way of just trying to say, what is it? You know, so that's what I mean by you're looking across the company. So these are the kinds of things you're expecting from this person. That's what you're holding them accountable for. That's what you should be talking about, this sort of thing. Right. And if you're talking about this one campaign they're running and you're getting in their crap, it's like either you're getting in their crap because they are not capable of that, in which case it's your fault because you didn't hire a good enough person and you need to fix that, or you're getting in their crap and it's not necessary. Which is also your fault. And you need to fix that by getting out of their crap.

Right.

You know, it's always your fault.

Right? Right. 100%.

But running away and not doing all the things I just said, that's wrong. Yeah.

So when you think about just to double-click on this one, when you onboarded this new CEO, I'm assuming it was, you know, a couple of months of time, right? And then how often did you interact after that?

Oh, all the time. Because the whole executive team meets. Let's see, we have a 2.5-hour meeting every week. And then we also meet again a second time for an hour. There can be ad hoc additional stuff, but that's the normal stuff even now. But at first it was way more. I mean, we were— it was like we also hired a CFO almost, almost immediately. So the 3 of us were actually meeting, I think it was 3 times a week for 3 hours.

Yeah.

Because there was so much just knowledge transfer. And also early on you don't have things documented at all, you know, so like a lot of it's just in, you know, In heads and stuff, and that's okay. Of course you don't. Of course you're behind on that. You know, it's all right. It just means you need to spend the time to do that, and you can't use that excuse ten years later. You know, like something's got to get written down, you guys. You know, but early on, it's a good excuse.

Got it. That makes a lot of sense. And then afterwards, yeah, you're meeting once a week, and I'm assuming there's like a couple one-on-ones going on.

Oh yeah, and one-on-ones. Yeah, and that.

Yeah, yeah, yeah. It's and this has been the same CEO. More. Okay, got it. I want to move on to, to the fun topic. And you actually wrote a good topic around AI, around how AI startups are going to be different. So I think maybe that's a good place to start. So how are AI startups going to be different? Yeah.

So I had written an article about how startups beat incumbents because incumbents have everything. They got money, they have a brand, they have existing customers they can just sell to tomorrow. They have marketing and sales channels that work. You know, they have product and marketing teams that do stuff. They can ask their customers stuff. You're struggling to get someone on the phone. Meanwhile, they can survey— like, we have 200,000 customers. We can learn all kinds of stuff really fast with real data. That's a huge advantage over a startup, right? So, okay, incumbents have all these advantages. What the hell are you supposed to do as a brand new startup? And the answer is, Lots of things. There's lots of things that a startup can do where they have an advantage, just not things like fighting over standard marketing spend. That's not one of the ways, right? But there's lots of other ways you've got to fight the battles you can win. So the whole article, that whole article is like 10 different ways, or I don't actually know how many because I don't do how many, but lots of ways where startups have the advantage and therefore, wink, you should probably do that, right? Because they can't, they can't hurt you. You know, how cool is that? Then the next week it was like, except in AI. Oh crap. Yeah, AI changes. Not all, but a lot of these is not true in AI. No, because all these normal ways to win as a startup and normal strategies for startup in AI, many of them don't work because it doesn't work the same way in AI. For example, one of the— I mean, this has been written about more than almost anything else probably is, is incumbents are stuck in the business model and products that they have. And even when they see something coming on the horizon, of course they don't react. They don't change. They in fact, they often retreat. We all know about the innovator's dilemma. That's a certain way in which that's true, blah, blah, blah. And that is true in AI. It's not true. It's not true that the old fuddy-duddy incumbents are going, hey, I don't know what that is. I'll just wait 10 years or, you know, until it's a mature technology and then maybe I'll look. That is not it. The whole thing with another one is Geoffrey Moore's Crossing the Chasm, right? This is a book that's, what, 25 years old now? Same kind of thing with the laggards. That's not happening. It happens so much that Geoffrey Moore could show dozens of examples across all industries. Yeah, except not in AI.

Yeah.

This is why AI really is special. I don't mean the tech is special. It is too. We all knew that. I mean, the competitive landscape and what incumbents are doing all in is different. They're like, why? Because their shareholders tell them you have to. I mean, their stock will go down if they don't have an AI story, whether their customers even want it or not. That's not even the question. Yeah, maybe they do, maybe they don't. I don't even know. Yeah, they may not even know, but they have to or their stock goes down. Damn. So every incumbent is doing AI, and that's not like any other disruption normally is. So startups normally have this running start— new tech, risky thing, uncertain market, which all of them are. That's a good thing for startups because that's where incumbents are like, oh, uncertain market, uncertain size of market, uncertain tech that might even be here in 5 years. We're not going to do that. And they're probably right not to. But that's why the startup's like, I'm happy with that risk because I can own a big chunk of that if I'm right. Yeah, beautiful. Except you don't get that. So sorry, that's not on the table. What else you got? So then you can go down the list of other things, but there's things like you're reusing a model like ChatGPT-4 or whatever. So is everyone else. So you have no differentiation with your tech and, oh, I have my own prompts. Oh, good for you. You think Adobe can't write their own prompts for PDF? Oh, give me a break. That's, that's, that's, that's stupid, right? Of course they can write prompts.

Yeah.

Now, that doesn't mean it's impossible to make unique stuff. That's— I'm not saying that. I'm just saying normally just using the new tech is enough for it to be unique. Normally you kind of get that as a gimme, and this time you don't. It's not an advantage. Everyone's in the same place. Dang it. Dang it. And you could say, I'm going to make a model, but we all know that costs a zillion dollars. So as a bootstrapper especially, no, you're not. You know, you don't have the data and you don't have the money to train a real model. So no, you're not. Even the big incumbents don't have that kind of money, with very few exceptions. Right. So no, you're not. So we're all using the same tech. Incumbents are there. Yeah. God dang. So that doesn't mean it's impossible. There's no way. It doesn't mean that. It just means the normal routes Just got eliminated, and so you better have something—a different kind of strategy than usual—and you better have something. Is it a niche that you can still target? A niche that works. It's you could still say, yeah, but the big company can't target this little thing. It's not big enough for them to worry about. Yes, you get to keep that. So the niche might still be right. It's possible that AI starts removing niches too. Possible. Not all of them, but I mean maybe. So like a typically good startup strategy is do like this successful company, but in Norway and in Norwegian, because I guarantee you that big company is not going to do it in Norwegian. They may sell to you in Norway because they'll sell to anybody but in English. And yeah, I know everyone in Norway speaks English. I get it. But like if we, if we admit that we're only going to sell to the 5 to 10 million people that speak Norwegian, I mean, anyone that wants to buy local and speak Norwegian, like they will buy us. So take an existing model that works and be Norwegian. It's possible that AI could disrupt something like that, especially in future, right? When it's more interactive in real time. Yeah, that might go away. Maybe. I don't really know. So that's just an example of maybe some of these things like niches, maybe some of those get eaten away at, some of them go away, maybe not. I don't know. But in general, it still seems like a good idea. Because even in that example, even if it could, quote unquote, speak Norwegian, the buy local from another person who's in Norway, okay, AI can't take that away. So that might be still a good angle that AI cannot steal. That could be a good one. So anyway, I'm not saying I'm an expert on all this or that these, you know, but just, yeah, here's a big list of stuff you normally get. Oh, cross half of them out for AI. Damn it. Now what are you going to do? So you can do it just like these decisions you make. Yeah. It cannot be based on the constraints you normally have.

Well, I think one of your big points in there is don't go try to compete with OpenAI. Like, obviously not. They have that covered, right? Of course. Yeah. You know, Tomáš Tanguz wrote a good blog post earlier this week about how maybe the future of software is actually selling AI agents that solve problems, which is what I've been thinking about recently because as an agency type business, I'm like, because we build a lot of stuff internally, how do we build these things custom to each, let's say, enterprise software company and say, hey, like, we'll just gift wrap meetings for you guys. Pay us, what, $800 per meeting? Okay, we'll charge you on a usage or performance basis. How do you— what do you think about that?

I don't know. It's whatever the customers will do. Yeah. If it works well enough. I think one interesting thing about how AI works at the moment is there is a few things where it's pretty good reliably, like summarizing, summarizing a meeting. And there's some things where you can get spectacular, spectacularly impressive results, but on reflection, they're not that good. Like the details are wrong. or missing.

Yeah.

And or it works 70% of the time, which again is incredibly impressive but not good enough to actually depend on it. Now, will that change over time? Of course. Of course. I'm just saying at the moment, you know, nobody knows what's going to be in the future. But at the moment, a lot of those don't work as well as you hope. So maybe they make you more efficient, but doesn't quite replace things.

Yeah.

But in general, I like the model for startups even without AI, which is essentially which I sometimes call like the human API, which is Here's the API, which could be literally an API, or maybe it's a UI and the customer wants something and it's asynchronous. So it's like, we'll get back to you, whatever that means. And then at first a human just does it. And then over time you say, well, what can I automate or reduce or blah, blah, blah, blah, so that it takes less and less human time to have the same result? So hence the human API. So it could even literally be an API. So for example, for WP Engine would be when a customer buys a specialized configuration, we make it. And that doesn't take forever, but it doesn't take 1 second either. It has to like make and come up and get configured. Like, you know, stuff happens, right?

Right.

So you can imagine early on we could have an API literally that says create thingy.

Yeah.

And what it would do, and then it gives you a job ID to check when it's done or, you know, some kind of standard thing APIs do. And then You can imagine what that does is it just opens a ticket in Jira that says, yeah, do that. Yeah. And the human, but when you close it in Jira, then that's what the— that's what the job is checking. But then you could, you could automate that. Maybe it doesn't go to Jira or maybe it sets it up but doesn't configure, or the human being sets it up but then clicks the button to configure. And over time it's fully automated. Yeah. Or maybe it's not because maybe if that API is only used twice a month, it's not worth automating it. And the human API is actually the right way. It's only if it scales out where you're like, oh, now it's worth it. Okay, so you can imagine building lots of things at the company this way, processes and stuff where it's a human API in some form or fashion, right? And then you automate wherever makes sense, either for scale or for cost efficiency or whatever your reasons are as needed. That's actually pretty good because you can do a lot of stuff and, you know, sort of make it better over time. Yeah, not everything lends itself to that, of course. Of course, but like, it's an interesting idea in that modality. Does AI help? Hell yes, because it might completely eliminate some steps or it might shorten a step for human. Oh, here, you know, because it gets it 80% for the human, human tweaks. Okay. Yeah. And then over time, as AI gets better, could it completely? Yes, of course. So I think this idea, this, this kind of concept of the, of the human API that you then automate, AI fits perfectly into that. So that to me is a nice little model that I've I've seen work and we've sometimes done at WPH.

That's interesting because I've heard, you know, that there's 3 forms of AI right now, quote unquote, that, you know, you have automated intelligence, augmented intelligence, and artificial. And like 99% of stuff is not artificial. It's mostly augmented and automated, right? And I think putting the humans first, because I think people are over-engineering, over-augmenting right now, maybe before we even really understand how this stuff works.

I have no idea. Yeah. So I don't pretend to guess what's going to work and at what speed. Not at all. Yeah. In fact, that's, that's part of why it's so unknown to invest in a company or do a company there. It's so unknown. Like, we just don't know anything about any of this stuff. And even though, like, there's 3 kinds, like, maybe, or there's 4, or I don't know, like, whatever. Right. But I do, I do believe in, in what I said about, about like, okay, but structurally there's some stuff that you need to incorporate in your, in your strategy. Yeah.

So let's talk about strategy real quick because we talk about strategy quite a bit on this pod. But in your own words, how would you define the difference between strategy versus tactics?

Strategy is overall how you're going to win. And then in particular, again, I think it's this set of decisions that make you in aggregate make you unique. Hopefully it's done things like leverage your strength, all these things we're saying. Hopefully that makes it a good strategy. You know, like ultimately, yeah, this is how you're going to win. And it's all the usual things like, what does that mean, how to win? Well, competitively and in the market and what customers need and what you deliver and at what price. It's all the usual stuff. Like, of course you have to answer the usual questions about it, but strategy is this is the broad answers to those questions. And so tactics, I don't even— it really just kind of doesn't matter. It's just like That's what strategy is to me. There should be no deadlines, no dates in a strategy, because that's planning and work. There's no planning. There should be no planning and work inside of a strategy. Okay. Because it's these main lines of, again, these big market-level decisions. We're going after small companies, not large, because the reason it's— we're selling through this channel instead of that one because this reason our product is going to be incredibly well-designed but barely do anything. It's going to be one of those do one thing but do it well type of products. That's how we're going to build it. Well, because reasons, reasons, because we're great designers, but there's only 2 of us. That's a good reason, you know, like, right? So it's these decisions like that and you may be wrong, like maybe no one wants that product. Okay, the strategy may not work. That's a different question altogether. But that's what a strategy is to me. These kinds of decisions at that kind of level, that's like, here's what we are, who we are, what makes us our deal, how we are going to win in that sense. That's what it is. The next level of things you would do, one would call planning. Now, again, these are big company words, but when I say strategy, it could be one page or half a page, no problem. It just needs to say those things. You know, it could be 80 pages, I guess, but like, it's probably better if it's one. So planning again, for us with 1,200 people, planning means a big— lots of stuff. There's lots of people and things going on and rationale and big budgets. And so planning has to mean a lot. If not, it might again be just like, here's the next 1 or 2 things we're going to do. The end. That's planning. Great. So how do you do that? You say, okay, well, I've got the strategy saying how we're going to win. If I was unencumbered by anything— oh, I just lost my big customer. Oh, my best developer just left. I don't know. There could be all kinds of things going on. Forget that for a moment. Suppose There were no problems, but you're still you with this many people, this much money. Like, you know, that didn't magically change, but there's no problems with your company. What would you do next to, to, to push this strategy forward? Oh, I do this one piece next because reasons, reasons. It's the competitor just did this and this was on our— this was our strategy anyway. So it makes sense to do it now. Whatever, whatever you're— and this is a This might take some time to go. Well, what could I do? I could, I can ideate all kinds of things against different parts of the strategy, and I need to sort of intersect that a bit with what's happening now. How much money do I have? This is too hard. Oh wait, this should be first. You know, that kind of stuff where you figure out this is the one, maybe just one, but the one, 2, or 3 things I would do next that are strategic. That's the first thing you do. The big company word is that's our strategic objective. What do you call whatever you want? This pushes the strategy forward. But of course, there are things stopping us from doing that. Those are your obstacles at the moment. And so the good question is, what is stopping us from doing what we just said was strategic? Because that sounds good. So what's stopping us? Okay, things, things, things. Okay. What are the, again, 1 to 3 biggest things that are standing in our way of that? Also take some time to figure out. Maybe by the time you've done it a few times, by the way, it doesn't take as long. The first time it takes a long time, but afterwards you're sort of Updating what you already have, and that's actually a lot faster. Okay. And then finally you're ready to say, so this is what we're going to do next. Again, probably just 1 to 3 big things. You're going to do lots of things, your tactics, you can do lots of things. I know that. But like, what are the— what's like the one thing you really need to do over the next month or two? That's it. Just like that simple. And you're looking at it like either you're reducing one of these obstacles or like you're attacking it. Or you're sidestepping it. So like, let's say one obstacle— obstacle could be, I'd love to do all this stuff with strategy. We don't have the money. Okay. So one way is to tackle it, which means let's go raise money or let's get— let's switch to annual billing. Right. There's like different ways to fix that or sidestep it. Okay, y'all, great. But we don't have money. How do we tackle these— one of these things with low money? We're going to get creative and maybe we'll figure it out. Maybe we won't. But that's what we're going to do, y'all. So that would be an example of sidestepping it. So, okay, so either attack or sidestep the obstacle. To do as much of this as possible. Obviously it can't be all because we just said you couldn't. Okay, but now you know what, you know, and then so then you have your 1 to 3 things we got to do next. That's planning to me. That is enough planning that you are really making like sensible decisions. But it's not some crazy— notice like nothing here is like rubrics and, you know, freaking— I don't know, stuff.

All these charts and shit.

You can, you can do it. Maybe that's your path. Maybe you want to do that in your pathway to this, but you end up with this very simple result. Simple is important because you can communicate it to yourself and others. And now finally you can say to the whole company, which might just be you, but okay, you know, so this is what we would do next, but this is happening. Therefore, thing, thing, thing. And that's what we're doing next. Break. Now everyone knows what to do. Everyone knows this is— these are the things that they need to figure out how to do. The bigger the company, the more important it is, of course. So everyone made their own decisions.

Yeah.

And therefore to know what those few simple things are so they can be aligned around that. Yeah. But even if you have 3 people, why wouldn't that be important? Also, it just— all this would be compacted and smaller and simpler. Good. But like, you don't not do it, right? You know? So that to me is planning. And so everything that comes after that, I mean, tactics is— I don't even care what's a tactic versus, you know, is fixing a bug a tactic?

I don't know.

Like, I don't really care. You know, it's like whatever all the actual work to do these things, whatever that is, that's the work. And but that's how I delineate that. I think that's about the right amount of structure to where you're making very smart strategic decisions that are that are self-reinforcing, where everyone's on the same page and so forth, but without like tons of process and stupid rubric, you know, without all this kind of academic stuff. That's why I think that's the right level of stuff.

Yeah. You actually cited a book. I think it's your favorite book, or at least on strategy, which I've actually had sitting on my bookshelf for a while. What is, what is that? Is it Good Strategy, Bad Strategy?

Yeah, that's the Rumboldt book. I love it in that it says what's on the title. It really does say like, here's what a good strategy is and here's what bad strategy means. Unfortunately, it does not tell you how to make one. So you end up going like, great, great, great. Wait, what do I do? It's like, oh, one of my favorite authors on that is Roger L. Martin. Also been doing this for a billion years, but he has a lot of good stuff about that that's completely compatible with like what is a good strategy. But a lot of the, you know, what to do, what I just described isn't, of course, how to make a strategy, but it is a way of implementing, you know, that kind of thing.

I have the title of the second book.

Well, he has— so Roger Martin has a set of books. He also has a great Medium. He posts like once a week on Medium and there's like 200 things. Those are all good. So like even if you don't get the book and you just like read the Medium stuff, that gets you a lot of good ideas.

You said it was Roger Martin?

Roger L. Martin. Roger is how he goes by. Yeah. I do think that Rummelt wrote another book called The Crux, which might help in building the strategy. Yeah, but ultimately there's, there's so many kinds of strategy as well. Like, at least in the literature, there's stuff where the people call emergent strategy, which is like you just do stuff. And when you figure out stuff that works, you're like, I guess that's our strategy. And then you, then you sort of name it afterwards and then maybe you do double down and align on that.

Yeah.

So that it's not a random walk forever. And so that's a way you could also be a little— you could try to be a little more analytical and thoughtful. And then you could argue, I think you could easily argue both sides of whether trying to be analytical and thoughtful is better because you, you know, get rid of some obviously bad ideas. And these ideas that you do have are more— have a greater chance of success, or whether you could argue you can't predict that stuff. That's all a farce. You can't do that. Just admit you can't and get going. I think you could make a pretty good case for both of those.

Yeah, makes sense. This message is brought to you by Leveling Up Founders, and Leveling Up Founders is an invite-only event for founders. It happens once a year, usually during August, and past attendees include people such as Ali Abdaal, Cody Sanchez, Neil Patel, Vanessa Lau, and the list goes on and on. And ultimately, it comes down to the quality of the group of the people. We try to keep the group high caliber. That's why it's invite-only. So if you are a founder at the top of your game, you can go to levelingup.com/founders to learn more about it, and you can apply. And We'll see you on the other side. My final question. This has gone really quickly, but you seem very thoughtful and philosophical, right? So like, I guess I'm just curious what, what's in your learning stack and how do you go about learning right now?

I mean, like, what am I doing next or how?

Just like how? So like you could say like, you know, I spend a lot of time, you know, 20 hours a week reading and I like— Oh, I should. Also, like, then if you are like, what are you learning? Are you talking to people? Like, what is it for you?

Mostly probably learning by doing and observing. Doing things, making— this didn't work, this did. Or observing other things which are not working or are working over so long. Writing really helps me learn, right? Because when I think, I think something and then I'm trying to write it out and then maybe it doesn't make sense after all.

Yeah.

Does that mean I was wrong?

Yeah.

Or I don't really understand this. I mean, part of why I have all these answers, I've written about most of this stuff before. Spend hours and hours on each one. Yeah, right. Going, wait a minute, is that so? You know, or like this system I just said. Yeah, I had a team where every quarter we did what I just said with— and there was about 50 people on the team. So it's kind of a mid-sized amount of process in there, right? Like not as the whole company, but not, not 2 people. Right. And every quarter we made a change. Every quarter we said, what do we want to try this time? Oh, I liked how this went. But this we didn't even use. Let's not do that, you know? And so every quarter we shifted it and it just got better and better, at least for us. And so that's, that's how I ended up, quote unquote, learning over 2 years, like, okay, I like this. This is, you know, this works. Although even there, I would say I find a lot of these structures like that, or let's say OKRs is maybe one a lot of people know where you can read the whole book and there's many, right? from OKRs. You read the whole book on that and all the details, all the case studies, all the examples, all the rules, and you usually can't implement it.

True.

I find most people cannot implement OKRs. Yeah, but it's not for lack of desire or knowledge. So why doesn't it work? I don't really— I mean, I don't claim like I really know because I haven't like investigated or asked. But my sense is that the culture and attitude of the company and how they work and how they think is much, much more important than we give it credit for in determining what frameworks and systems are going to work for them. So there are companies and cultures that are— that where OKRs fit like a puzzle piece. And so they work, but usually it doesn't. Not because OKRs are bad, just because organizations are all kinds of different ways. OKRs only fit in certain ways and all of them only work— everything I just said, I just said it worked really well for this team. That doesn't even mean it would work for every team at WP Engine, much less some other company with a different culture. Right. It does work for other teams. It has spread through the company. That does. But it probably won't spread to all teams and probably shouldn't, interestingly enough. Yeah. Right. So, so why exactly and what does it— I'm not sure, but it's a good question, actually. So, so I'd say as part of the learning stack, sort of like we were saying about advice, you got to find advice that fits. I would say that too with this frameworky stuff. The framework has to fit And it's even less clear than advice how to know. So maybe you just need to try it on and see, and maybe that's all you can do. That's still useful to know, though, because you could go in going, okay, everyone, we're going to have some kind of thing for like KPIs and goals. There's like 10 things we could do that are all reasonable, but we don't know which one's going to fit here. What would we like to try first? So it's a totally different attitude. Usually I think what happens is Someone decides it's OKRs and then it descends on the whole company.

Yeah.

So if you knew that is maybe a bad idea, then you could try a different thing, maybe different teams try different things, and then they all report back in 2 months how they felt it went well and not. And then together you, you know, or maybe, maybe you do all try one thing, but then again, you really seriously evaluate, is that OK? Rather than saying we're doing this and then when it fails, you're like, management sucks. If you come at it with, we're going to try this and then we together are going to decide if we like it or tune it in, you know, that feels like we're going to learn together and that we're all empowered to get better. That feels a lot better than just manager says this and it didn't work, you know? So knowing that going in is helpful, even if you don't know exactly what to do.

Constant experimentation.

Yeah. I mean, it's— yes, I think The smaller you are, and especially before something like product market fit, for sure, constant experimentation, because definitionally you don't know what the hell is going on and what is going to work and what's going to do. So that's your life as you're experimenting after product market fit. That's not true. You do know it's this. This is your target customer. We need to double down and get as many of those as possible. Sure, you're going to A/B test your ads. But you're not A/B testing who the customer is. You're A/B testing how to talk to that customer. Totally different and different tactic, you might say, level, not strategy level experimentation. Also, if you have 1,200 people and you have a strategy to follow, you can't be constantly shifting it around. And yet a strategy that doesn't change is wrong, right? So given a scale or scope of a thing, it is true that if it doesn't change, it's wrong. But it's also true that if you're changing it constantly, constant experimentation, you can't follow that. Like, that's disruptive too. So it has to be tuned to the scope of everything. So the more people and the wider the thing is, the simpler it has to be or they don't— you can't keep it in your head and understand. And the slower it can change.

Makes sense.

But not never, just slower. Right. And with more fanfare. Okay, everyone, We're going to change this pillar of the strategy. Why? Oh, we learned this. We learned that. We have this data. We did it. And now, you know, it has to be like a big deal. Whereas, of course, switching a Jira ticket around had better not be a big deal. We better not be approving it and talking. What? Right. Ridiculous. Right. So as you get in there, like, of course you don't want any process. That's, that's stupid. But the bigger and broader it is, the more it's like we— if we change this all the time, if we, if we just change the strategy all the time, No one can follow it and it's a disaster. But not because we're dumb or big companies are dumb, like none of that, because that's the nature of it. You also can't refactor a codebase that's really big and old tomorrow. Like, that's also a bad idea, right? So, right. So hence, like, like what I just said about that thing, we only did that once a quarter. So we only experimented 4 times a year. That's not very fast. Right. But But it was enough to where we got better. And in between, we weren't spending all our time optimizing everything or experimenting everything. Come on, we have other things to do. So we kind of spent what you might hopefully call the right amount of time going, you know, we got to do this so that we're smart about our plan. We could tweak this and that based on what we said last time and then shut up and we'll— I'll see you in 3 months. And we'll, you know, 100%.

Well, Jason, this has been great. It went really fast. What's the best way for people to find you online?

asmartbear.com.

That's simple enough. Everyone go check it out. There's a lot of great blog posts. I didn't even get to all the blog posts I wanted to talk about here. Maybe there's a round 2 in the future. Thanks so much.

Sure, be happy to.