Big bets are stupid. Do this instead.
Michael Girdley argues successful founders don't make one big bet. Instead they test ideas cheaply and repeatedly. His podcast started with a Twitter poll and a Fiverr editor, then grew over four years into a six-figure business by scaling only when evidence supported it.
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When I talk to young entrepreneurs, one of the things that they get most confused by is the ideas around risk-taking and entrepreneurship. And it reminded me of a conversation I had a couple months ago where I was talking to a young entrepreneur. The young entrepreneur kept coming in and saying like, "Oh, I wanna take a big bet on this," or, "I want to invest a lot. I need to borrow or I need to raise a bunch of money to go pursue an idea that I have." I said to him was, "I think you have this backwards." Like the great entrepreneurs that I've watched and learned from and sat at their knee and kind of learned what they have to say, the great entrepreneurs tend to take a lot of little tiny bets and run a lot of tiny little risks that in aggregate can look like a big risk if you're outside of it. But in reality, what they're doing is they're making incremental little tests to see if something will work. And then they're doubling down on those things based on, well, what they learn. My name's Michael. If you like talking about business and entrepreneurship, I encourage you to sign up for my newsletter. I send emails on a weekly basis with stuff like this, and I'd love to share what I know. It's fun for me. If you enjoy that kind of stuff, sign up now. It's free. You know, this discussion reminded me of how one of my ventures got started, and it's turned out to be really successful. But if I look back on how that thing happened, it was just actually a bunch of little tiny small bets that I made that eventually turned into something pretty huge today. And this thing is our podcast. It's called Acquisitions Anonymous. Uh, we started going on nearly 4 years ago. Uh, it's me and 3 other partners that do the podcast together every week. But the way it got started was pretty fascinating. It was me just having a brain fart one day where I was like, you know what would make a good podcast? Let's get together in a room, me and some hosts, with no prep. We'll take a look at some businesses for sale and we'll just talk about 'em and offer insights and make some jokes along the way. Like it'll be a ton of fun. So the first little bet that I made was going on Twitter, which by the way at the time was still a little bet for me where I had just started to like write stuff on Twitter and people turned out they kind of liked it. But I went on Twitter and I said, hey, I have this idea for a podcast. What do you guys think? Anybody interested? And I got a couple responses of folks that I had read their tweets so that I knew they were smart and would potentially be entertaining type folks. And the first one to respond was my partner in the thing, Mills Snell. Who, by the way, 4 years later, I still haven't even met him in person. Business partner in a successful venture. And yeah, I don't even know how tall the guy is. So your natural inclination with something like this would be like, okay, well, let's figure out what our partnership split is. Let's get a shared bank account. Let's go do all this stuff. Let's form an LLC. Let's write a business plan. Experienced entrepreneurs do is what we did next, which was we didn't say, hey, let's go do all that complicated stuff. Let's go just try one episode and see if we should do 2 episodes. Basically, it's like, let's try one and see if it works. It works. Because who knows, like, we might show up to the first episode, it doesn't work, we don't have fun doing it, like, or nobody wants to listen to it. Like, let's go try a few episodes, see what happens. And that was the first bet. Like, we just showed up. And I think your natural inclination then is, after you record the first episode, well, like, let's record 10 or 12 so we see if we actually get good at it before launching it. And I was like, no, no, no, no, like, that's not what experienced entrepreneurs do. Like, we took that first very rough, frankly, uh, episode. If you're interested in listening to the very first episode, you'll see a world of difference between episode number 1 and episode number 400 for us. And it was pretty rough. But at its core, like, people are either going to like it or they wouldn't. And we knew that. So the next small bet after recording that episode is like, put it out there, see if anybody gives a crap. And if you go look at other podcasts that people do, and I'm always amazed when like some billionaire launches a podcast like Steve Ballmer or something like that, like they spend all this money, all this design, all this kind of stuff. For $150,000, $250,000 to produce an episode. We paid some guy on Fiverr like $20 to do our editing. And we actually waited for months to do some of the stuff that people would want to do before they even launch anything. We waited to produce an LLC. We actually operated out of my bank account for some period of time. So we were just like, nah, I don't think we need a bank account yet. And we operate out of my bank account. By the way, we're a real business now. Like we have paying advertisers and a producer and all that kind of stuff that you expect in a real professional podcast. We have all that stuff now, but like we focused on what really mattered early on, which was like, does anybody give a crap for this thing? And the way you figure that out is you start to just do these little tiny bets and each one is an incrementally more intensive bet based on what you've learned before. And we kept just doing that same framework of incrementally trying things, seeing what worked, and then just building the business. And I think we're a testament now to where podcasts can go, especially a niche podcast. Like we're doing 6 figures in revenue from advertisers. We're able to pay a full-time staffer to do all the production. And it's kind of a beautiful situation for me and my partners. We just show up and we record. Like, there's no prep, which is amazing. Staff that we have turns around and does all the stuff that to us feels like work. They sell ads, they produce the episodes, they publish everything. But it's all because of this mindset where we went in and we just take like little bets to see if anything works. You just keep doing these little bets and incrementally you build up those layers of the business. And then you look up 4 or 5 years later, you've got something that's like a real deal. The funny thing about it is it's easy to look back on that stuff like 4 or 5 years later and be like, okay, like we have one of the most popular podcasts on buying and selling businesses. Because you've done it so incrementally, it's easy to forget that that's quite an accomplishment. Like we've created something from nothing where it didn't exist and it makes money and we have fun doing it. Like, pfft, like because you've done it incrementally, it's easy to kind of forget how cool all that is. But in the end, if you're new to entrepreneurship, if you're new to kind of this multi-business ownership space, like you really have to think about how do I make lots of little bets rather than take these big bets? Because frankly, like the way we're taught stuff on TV, the way we're taught stuff in some of the school programs is it's not these big Casey at the bat home run swings that turn into really amazing businesses and opportunities for people. It's people going out there, taking small risks, and then just doing it day and day again until eventually like you have something pretty awesome after a few years. All right, thanks for being here for this video. I'll catch you next time, and let me know what you think in the comments below.
