Hello everyone and welcome to the Boots of Funded Podcast. Today I'm talking to Daniel Vassalo, writer, founder and personal with very strong opinions. He's building a portfolio of small bets in public on Twitter and I will talk to him about the importance of making money in diversified ways, how to structure your life around being a founder and how to figure out which business ideas might actually work. Here is Daniel Vassalo. I'm super glad you're here because I have a couple of questions. Do you have you've written a couple tweets over the last couple days that I would like to talk about and one of them is our mutual friend Dan Routin who runs ilo.so this Twitter analytics thing. He has started a pricing experiment I guess offering lifetime plans and he talked about it and you tweeted something at him which I found very interesting and which probably will confuse every single software as a service founder that is listening to this.
You said that upfront revenue is more important or bigger than recurring revenue. I would like to know what that means. What were you trying to say and like how contrary and did you want to be with that one? Well not very much I think it's important to realize that the current revenue is just an upfront payment paid in installments. I mean there's always a lifetime value in all SaaS businesses. If the average subscriber stays for 18 months and you're charging $10 a month, basically the average lifetime value is $180 if you can collect that $180 upfront, it's better objectively. Right now of course there are situations where the cost of running the business, the cost of sales are proportionate to the time. You're running a hosting service where it's infeasible and I'm not saying that the current revenue is bad or it should never be used or whatever.
I'm trying to make people consider whether they should be considering lifetime these, whatever you call them, upfront payments, one time payments because I think the main advantage is that usually they make the sale easier. I think I look at my own behavior every time I'm about to sign up for a subscription service even if it's $5 a month and I can afford $5 a month. It's not a big deal but I'm always reluctant. I'm always, there's this psychological thing, or seemingly irrational thing, that makes me reluctant to add another thing onto my bank statement. This feeling that maybe I won't use it every month and I'm overpaying and maybe if I want to cancel, I won't be able to find how to cancel it or forget about it. There's something in CIDI that I think everyone recognizes subconsciously about subscription, which I think basically you're putting that burden on your customer and the most delicate point when they're about to sign up.
When I observe my own behavior, whenever I need a piece of software and I notice that it's a one time fee, even if it's a high one time fee, if it's $200 to $100, I'm more likely to impulse buy by knowing because there's a sense of ownership as well, which I think again we under value. Of course, you could always say you never really own a software, I bought Windows 95 back in 1994 and I don't think I can run it anymore. A lot of paid, a lot of money for it, but I felt like I owned Windows 95, I had the CD, I could install it, I bought a new computer, I installed it again, all these kinds of things. I think with the software that I buy one time, recently for example I bought a screen shutter tool from Tony who might know him, I don't know, I paid $30 or something like that, I own it, now there's an icon on my computer, I'm not paying anything.
Of course he's saying, I think in the small plane, he's saying that if he may need to do a major update or whatever, it might be a paid update or whatever, I completely fine with that, like Windows 95, when Microsoft released Windows 98, I had the option to pay for it, so I thought at some point, computers became outdated and there's probably no computer in the world now that would run Windows 95, but it's okay. So I think it's true, I'd subjectively do that up front, collecting the money up front is better than getting it in installments, of course, but some people mislead it as like, I'm against the kind of payments, that's not what I want to say, but I want to make people consider my pause and make their lives easier, I think for certain software, I think it's a very, very viable option, which I think I always a great example, and I think he would, I think then would get a competitive advantage, because I think none of this, a couple of competitors, like in his space, that over a lap a lot, I think right now they're all the cutting and these sort of $20, $30 or higher per month, if he would be able to, you know, pay $120, I don't know, 190, I don't remember his pricing, I think he might get a advantage there.
I can see that too, and there are certainly different kinds of software that fit different kind of pricing models, right? You have these things that obviously benefit from one time payment, like software, like standalone software. I also bought snapper, I also bought that piece of software for the exact same reason, it's packaged, it's one thing, I don't expect it to grow into like the world's biggest, you know, like platform for screenshots. I just wanted to be able, I want to be able to take screenshots of the things that I have, and for that it's great.
I think for an analytics platform, it's similar because it has a certain kind of purpose, but the risk that I always see, which is why I bring this up, is that people overestimate the amount of money that, not over a same, well, people overestimate how much money they can make, by forgetting how much expenses they actually have in the future, down the line. Because with any kind of upfront payment that is not recurring, at some point, and hopefully far in the future, your customer has used up the amount of money that they paid to you, right?
So you have to compensate for that. So where do you draw the line? Where do you think, for a founder that has not yet implemented that kind of particular payment system, like an upfront payment that only has recurring revenue, how would they go about calculating the price that they should be actually asked for? I have no heart at all, but my only heuristic agenda that for everything that I've done so far is to slightly add on undercharging. I know this is probably also concerning advice, usually the things that we hear on the intent is charge more, you know, you should raise prices, whatever.
I'd rather leave some money on the table, get more customers, get more word of mouth, get more reputation, more credibility, more emails, and my contact list, my email lists. And the way I err on undercharging is by saying to psychologically put myself in the shoes of my customers. I know this is not a perfect heuristic because I'm not like every customer, you know, people with different price purchasing power and other parts of the world, whatever, but I make an assumption that at least there's a decent percentage of people that might behave like me.
And I try to put myself, you know, in my shoes, like if I'm visiting this landing page, right, would I pay $50 for this? Would I pay $50 a month for this? Would I pay 10? Would I, and if once I get it and I do consume the product or start using it, would I feel satisfied with how much I paid? And again, it's hard to do because we have to tap into the subconscious, right, because it's not something you analyze on a spreadsheet, but it's what I try to do, right?
And then I base my pricing, both pricing model and the price points as well based on this. And you know, it's, I think it's not a one-way door, like you can change pricing later. So you can start with something generous, like at least my undertape, as things start to go, you can optimize later. You might notice, maybe I can charge more for this, right? And then improve things.
I was watching the base camp guys a couple of days ago, how they discussion about pricing, right? They've always been, you know, very simple, not per-seed pricing for base camp. And now they're actually experimenting with a per-seed pricing. This is one side-to-side with Sun. They were discussing how after 20 years, they're making the set-able change, but it's not that daunting because they can always revert it, right? They can always only apply to new customers.
几天前,我观察了 Base Camp 的团队,他们在讨论定价策略,对吧?他们一直以来都采用非常简单的、不按用户数量计费的定价方式。而现在,他们正在尝试按用户数量计费。与此同时,他们也在与 Sun 进行比较。讨论中提到,经过20年后,他们正在进行这样一个显著的改变,但这并不可怕,因为他们总是可以撤回这个改变,对吧?他们也可以只对新客户应用这种新定价方式。
And you know, these things that seem risky, I would always start with again. I think the biggest mistake, no, not the biggest. One of the mistakes people do are they tend to be too greedy in the beginning. I think the beginning, I'd rather leave money on the table, but get customers, right? There's another thing that Tony does a little while, by the way, of the behind a snapper, right? He's the least snapper for free in the beginning, right?
I think I got the first copy, actually, for free, right? I paid him just because I wanted to support him, right? And he basically allowed it to go viral. He got thousands of customers when it was still very crude, basically an MVP, right? And that's one point of the couple of months. He put a buy button, right? But I think it's an amazing strategy, right? It allowed him to understand whether people wanted.
He got tons of people signing up, got their email address. Amazing. Yeah. I think I particularly now that you mentioned the base camp guys, I saw that too. They're building in public. That's pretty much what that was, right? They're communicating their internal things on a public medium on Twitter. Tony is doing the exact same thing. He's building in public and he has been building in public for a long time now, not just with book snapper, but also with like magic, his Twitter integration and all these other tools.
And you are building in public too. I mean, sometimes with like snazzy contraintakes, but often also with a lot of data, a lot of graphs and information on what you're doing, how you're doing certain things, I find that incredibly exciting. Like every time you post something like that, I'm just digging into the data because I, first off, there's nothing better than actual data to make choices from and then seeing how you make choices from that data, super exciting. One of the things that you stand for the most and I would assume that most people who are listening to this know this, but I'm still going to try to, you know, give you the chance to explain it. What is a portfolio of small bets? What is a portfolio? What is a small bet and what's a bet? Can you give me some kind of underlying definition for this?
Yeah, it's absolutely. I think it's just a fundamental attitude that you're treating business ideas. I like to use the term like cat and not like pets. Basically, you don't make a business idea part of the identity and you go on all in and you're taking impudent risks to try to make it to the reality alcohol costs, but you're just potentially building an experiment, building a portfolio. It's very similar to how a VC builds a portfolio of startups they invest in. Of course, there are differences between a VC and us as individuals, so we can't invest into a thousand businesses, but we can have, I think, very realistically, four or five income streams.
Some might be bigger than the other because business is unpredictable and sometimes what succeeds is not the one you're mostly expecting and things change over time, but it's basically this attitude. I don't want to be known as the creator of the good parts of AWS or the founder of user base or the creator of the Twitter course or small bets, community host or whatever. Because next year, I might be doing something different. And this doesn't mean that I'm already thinking about something that's actually like, now I'm pretty focused on one thing that I have this community. It's working well. I'm going to try my best to continue to grow it and make it as successful as possible, but it's just the attitude that it doesn't have to be this.
I'm not doubling down and going all in and sort of ignoring everything guys. Basically, actually, intentionally, I'm leaving space. I don't want this to consume all my time. I'm leaving space at the time still watching for opportunities. Take a look at Peter levels. He had no mid list, which was probably a wild success by many measures and he had the motor okay, which was even wilder success millions of dollars, one or two millions of dollars. I live in Europe per year. Look, he's now experimenting with interior AI just yesterday. He launched this AI avatar. I think it made $4,000. Little idea to implementation too.
But the thing is, if Peter levels had labelled himself as, I'm the founder of no mid list, I'm just going to do things that are on nomads and I'm going to specialise in nomads, whatever. He would have missed out on other opportunities. Like the motor, maybe the motor, okay, you can say it's related, but this is completely related. Interior AI, interior design, probably the opposite of nomads. I don't know if nomads are that much into interior design. I don't know. But it's fascinating to see. And again, this doesn't mean that he's neglecting everything else. I think what it means is that he is like I do, that he's not relying on nomad list, be keying there forever, or the motor, okay, being there forever.
He's leaving slack in the system space so that when he finds something exciting, he pounces on it and he decides. The only last thing I want to say when I say small bet is that at these business, I believe this maybe is something, again, people think it's controversial. I don't think it should be controversial. Business is unpredictable. If I were to tell you, I'm about to launch a software service that helps freelancing, accountants keep track of their finances. And I show you a demo. I tell you my marketing strategy and I ask you how much money do you think I'd be making in six months? It could be anything. $0,000, $1,000, $1,000, $1,000, $100,000, $1,000, it's very different. Very different situation than if I were to tell you, I'm going to take a job at Google as a junior software engineer.
You can probably Google the range and you know, you get a decent average and chances I'm going to be making close to the average. Business is unpredictable. Right, so knowing that, knowing how hard it is to know what's going to work and what's going to fail, I think the only clue in strategy is to radically deduce the inputs, the efforts, the investment. Again, very similar to like every seed does. Every seed, they have a $10 million fund or whatever they don't just write $10 million to the best idea they hear, like the whole check, they write $100,000 checks to a thousand companies. This is the same thing book publishers do. They publish multiple books, many books, thousands of books, like the same thing movies studios do in Hollywood. And I think we should be doing something similar, of course, to a smaller scale.
I think we need to be even more rigorous with the selection criteria. Every seed might afford to invest in a thousand startups and 900 of them fails. We probably can't. So we need to, you know, maybe XI-5 things, four or five things in a year, maybe three things, you know, depending on our circumstances. But I think we need to be even more selective things, the things that we try, we need to make sure that we don't over invest our time because, you know, if you invest six months in something, how many six months please would have in our lifetime? Like not a lot when you think about it. That's right. I mean, that's a very, very expensive thing.
So I think it needs to be small less than a month, I deal a couple of weeks, Peter levels, again, great example. You see him do these things like very quickly. And then something's works, something's don't. Like this is the reality. And then you sort of you take it from there, right? And then you can make another small bet on what works. Again, I see Tony do this as well. It's like snapper, small bet weekend project. 4,000 people started using it. Then he made another small bet. He spent an amount adding more features and then he launched his own product hands. Then it went number one on product hands down. He made another small bet.
So I to make it a bit more even better with more cups and whatever. That's what I would like to encourage people to tame the uncertainty of business because it's hard otherwise. I think you just go on. And probably just to finish to finalize, I think this is that most people underestimate the psychological risk. I don't know about you, but if I were to spend six months working on something and it fails and maybe I try against six months on something and fails, I want to be discouraged. Right? I mean, no matter how much will power or runway or savings I have, it's hard. And the psychological cost can be a ruinous game over a state.
So then you might have to go back to a full-time job or something that you don't want to do. That's right. The mental health implications of these entrepreneurial just the journey that most people are on. People don't really think about that. Like how quickly it can actually damage their health, like physical mental health. And I think you said something really cool in a tweet, also a couple days ago, you were or somebody was talking about the concept that you introduced to them of a good idea is an idea that doesn't break you if it doesn't work out. And I really, really like this because this kind of brings together this small bet approach with the mental health care that people should take on their entrepreneurial journey.
So can you talk to me more about what good, compatible, small bet ideas look like? Not specific ideas, obviously, but what kind of common things do they share? No, no, I think for me, I have a selection because I do a list almost like in my head that when I bump into an idea and I start to get excited, I start being inspired and see an opportunity. I try to ask myself, can I bring this to market quickly? For me, quickly, my current situation with two kids limited time, other things going on in my life, quickly, ideally, a week or two. Like, can I bring this to market in a week or two? Sometimes, a month might be okay, but it starts to be a slash for me.
And I think this can change, you know, if you're still very young, you're in your early 20s, you have less commitments, sort of maybe you can afford that a little bit more. But again, I think we all have the same 24 hours a day, same average lifetime, roughly. So if you start spending six months a year, I think it's always a big big big bet for everyone. Number two, I like to bring, I like to start with things that I can bring to market on my own, not because I think I can do every thing, but for me, it's almost a little more test that it's simple enough.
I think I like the flexibility that if too mild, I start feeling, I lose interest or I start feeling that this is not, I don't see the opportunity anymore. I get, I start thinking about something different. I don't want to feel sort of the obligation that there's somebody else with me and I'm letting them down and they're expecting, you know, and there's a lot of, I need to manage that. I want to be agile. I like waking up in the morning and just having options in front of me and no obligations. And I think if you start doing something with someone who, at least, at least in the beginning, that afterwards, like, for example, my small best community now, I have multiple people doing guest classes, like this sort of some arrangement. And that's okay now because this thing is sort of, there's some momentum. It's going on, but I wouldn't have done that in the beginning.
In the beginning, how I started that project was just one cohort, one cohort course, right? Just meet a living get just two weeks, right? That was the limit, right? And then sort of once it's that we can't full booked. I'd say another one and a few more and sort of I kept at the lengthing over that. I also like to do things where I like to call them where time is my friend, right? And I dislike opportunities where if the opportunity doesn't pay off before some time, then I have to shut it down. And this is tricky with software as a service. I did them some mistake with user base, like with user base, I built a software service business that requires 24 seven support just last night, a couple of nights ago, I go to go to go to 2 a.m. in the morning, some a duress, some disc, then out of space, I needed to clean it up.
Right? It's annoying. And luckily, it really happens that with user base is quite simple and customer support burden is not a big deal. But if it were different, right? I would have been forced to either shut it down or sell it or whatever. But right now, even though it's not making me almost any money, it's basically breaking even. It's just running on its own. Maybe at some point, maybe I will find a buyer or maybe it will pick up, who knows? But time is my friend. Basically, I don't wake up in the morning feeling that I'm running against the end of the runway. The day can only bring good things, because it's the end. Information products are an excellent example of this. You can never get a negative sale or something.
After the morning, I wake up and I see a couple of sales as just a surplus. I said just a positive surplus. Of course, even for products, at some point, might become obsolete. Maybe I have a technical book. Maybe at some point, I might need to put it off the market, but it's still not an obligation. Either I update it, so I don't move it. So more or less, those are some of the things. Another one might be, this is, I think, very conventional advice. I avoid doing things that don't all like this site to not be too novel. I try to go with the flow, Justin Jackson. He's a Jackson like the Sunset Star guy. What's his name? Justin Jackson. Justin Justin. Talks about this a lot. Do not try to be too novel.
I like to look at what is money exchanging hands today are people buying self-published books. In 2012, before gummed out and before the creator economy started, there was nobody almost. Making self-published books or buying self-published books, I had never bought self-published books. Now it's changed. Now it's different. Now I think my gummed out library is bigger than my Kindle library. I buy more self-published books than traditionally published books. I think this is important information. I wouldn't self-publish in 2012, but I would now. There's many other things happening as well. I wouldn't call them to the ends, because to me, it implies the future where things are going.
I think it's basically looking at the present. Like right now, what is exchanging hands? I tend to try to stick to things that are already working. I'd be stacking the odds against me and that makes things harder. Yeah, that makes sense. It's kind of validation as far as you can validate anything, which was also something that you recently said. You don't believe in validation. You believe in hints. Hints at that something might be working. This is a semantic argument, but I think it's an important semantic argument, because the term validation should be used in mathematics and logic and whatever things that have certain decent uncertainties. Business has none of that.
Business has likelihoods and unlikelihoods, probabilities, or higher odds or lower odds. I think if the way people use the term validation is as if something went from a state of non-validated to validated, a binary thing. There's a rubber stamp of validated. I think even if you're careful with it, I think if you start thinking of it like that, you start fooling yourself.
With user-based, I made this huge, huge mistake, where I over-invested. I lost a lot of money out of my own savings, where I started building in public. I started getting the traditional validation signals. I had a waiting list with over 4,000 emails. I had endorsements from highly influential people, the CEO of Netlify and very self-publicly endorsed me and tweeted me. I launched, number one on product hands, front page on hacker news for a whole day.
Even launched it in terms of revenue was good. I made a few thousand dollars and says, you might say this is a validated business. That's what I thought. I should be harder than employee. I should be spending more. Then it turned out that things were harder than they seemed. To convert people from the fleet's liars to paid, the people who are expecting more and more competitors emerged.
I'm almost ashamed to say, I spent almost 150,000 dollars out of my own savings in that business. That is only making about 10,000 dollars a year in revenue. Not a month. I put almost certainly never the cover. That's a mistake. Nobody should be doing that. I think what fooled me was the thinking in terms of validation.
I thought this was a validated business. The demos that I was releasing before, it was released. Lots of usage, lots of people, lots of enthusiasm. Again, we should eliminate the term because I think it's insidious. You can never validate a poker hand. If you're playing poker, you might think you have a strong hand or a weak hand or something in between. High strength, medium strength, but it's never validated because you never know what's on the other people's hands or on the table or in the deck or whatever.
Business is way more complex because poker is just 52 cards. There's limited odds. You can calculate the odds. Business and the real world is just way more complex. Millions variables that you don't really know what's going to happen. It's just a semantic argument. I know that people, if you dig deeper, agree that it's just signals.
I think it's important to beligulate with how we think. Think of signals. Think of hints. Yes, this is a hint that there's some demand here. There's a hint that I might be able to fulfill that demand. There's a hint that the supply says is appropriate. Whatever. But I wouldn't think of certainties and use the term validation. Yes, definitely not binary.
Since you were talking about this as almost a philosophical concept, the idea that you could even validate anything. In social sciences, there's a call purpose argument that you can only falsify. Exactly. Any theory. We should have a bit of it. I would like to say, yes, you can invalidate. For example, if I'm trying to market a product for free and I'm struggling to make people use it while it's free, I think it's almost certain.
You can probably say it's certain that I can't monetize it or very properly, like you can invalidate a business. You can't invalidate it. I think there are certain, basically certain evidence that will tell you that there's no chance. If I can't get people to come to my landing page, because you can't see that if nobody knows about your business, you could have the best product in the world. It's guaranteed failure.
But if you build it, they will come. Isn't that how it works? No, absolutely not. I think that's very important. I think your approach of the statistics, like the statistical approach, like this thing might or might not work out, and then adding strength and numbers and having multiple experiments at the same time, that gives particularly solo-preneurs or bootstrap founders, people who use their own money to build a business, instead of having somebody else's money to play around with.
That gives them some more fundamental footing to at least have a higher chance at reaching some kind of profitability. So if you need to have multiple experiments going on, how many is enough and how many is too many? Because I would assume that some people that you're currently working with in your community probably are trying a bit too much or a bit too little in terms of diversification.
What's a good approach to the spreading out your experiments there? I don't have a hard number. I think whatever I think what I recommend, again, is that we described Peter Levers before. How many projects does Peter Levers have? He probably has like 70 projects online that he's in turn of. But realistically, every day, he's only working probably actively like high intensity mode only on one.
一个好的方法来分散你的实验是什么?我没有一个确切的数字。不过,我的建议是,之前我们提到过一个叫 Peter Levers 的人。他可能在网上有大约 70 个项目。但实际上,每天他就只会专注于其中一个项目,并以高强度的方式投入工作。
Like probably on the avatar thing, last week it was on the interior AI and it probably flipped up a little bit. Maybe a month before it was on the motorcade, maybe a few months before. So like actively only on one. And and probably even in the span of a year, like if you were to examine 2021, probably here might have only touched four or five. But he has 70 running. So could he have 110 40? Probably, right? I mean, they're not really consuming much. It's just things that he, again, that he started and they're there. They might think something. They might not, right? And it depends. So I think rather than thinking in terms of should it be five, should it be ten, should be a hundred, I think what I'd like to do is like take the attitude that makes sure that whatever you do, do not sign up for so much work that you become completely busy. Leave some slack in the system.
Always be watching for opportunities. No matter how good things are, like if you have something that's making you $50,000 a month, right? It might be great. Amazing that you're making the most money you've ever made. It's wonderful. I would still recommend leave some time. Some slack in the system. Keep watching, right? Because you never know about anything. This thing that's making you $50,000 a month, you know, there might be some disruption that might reduce sales. It might be you start hating it. The light preferences change. It might start well, well, in go and then holding your life because it might become, you know, scale changes things.
That's something that I think Jason Friedens intended to just posted a tweet a few minutes before we talk there. Scale changes things, right? And you never know how it's going to affect things. So again, it's, I keep using Peter Levitz as an example because he's a perfect in this. Despite having something that was making him millions of dollars a year in the year, many people would say, oh, we should double down. Forget everything. Guess everything. Guess there's a distraction. No, he's playing with unrelated things, right? And right now, I think he's more insensically interested in playing with AI than in sort of improving no mid-list.
And that's an important thing. Intensic motivation is so, so powerful. Like if you feel that you're not doing something with your force, like it's a pity to not use it. When you feel that drive, I think you should try to ask yourself, presumably, like what Peter did. I mean, can I do a business around this? I'm playing with AI, I'm enjoying it. Can I do something with this? Right? And what I like to do as well. You know, I'm doing that now like crazy things. I've spent the last couple of months doing DIY around the house, you know, small things that I'm still very much a newbie.
In the back of my mind, and this is something completely new to me. I'm a newbie in DIY, and I don't have an audience that knows me about DIY projects. I don't have anything and a credibility. But can I do something about this? Maybe in the future, it's in the back of my mind. Now, I would love to. Probably I would prefer this than, you know, doing something related to tech. It's what I'm thinking. I jump out of bed the morning, the first thing I thought of, I'm building an office in my garage. I should write, I need to go up to Home Depot by some two by fours. That's the first thing I thought.
So, again, this doesn't mean anything will happen. It's a good chance that nothing might happen. But it's there. So I'm watching for opportunities. If something, would it be an info product? Would be selling some plans for what I'm doing? Could it be some tool? I don't know. But I'm always wondering, always watching for inspiration. So that's, I don't know, I answered your question. That may be a bit sort of other way around, but no hard number, just an attitude, I think. Just keeping second system, keep watching.
Yeah, the attitude is exactly what it is. And that's, and let's just keep talking about Peter levels. Why not? Like, he's a great example, right? Hey, Peter has this attitude two things. First off, he is fine with failure. He's fine if stuff doesn't work out. And he's also always a beginner in every new, every field that he encounters. And he considers himself one. He doesn't consider himself an expert by any means, right?
Like, just, just look at the two latest projects that he built. Like, really simple user facing UI that you probably wouldn't expect to see. Like, it's really basic and everything is kind of just glued together. But he doesn't, he doesn't need to show that he is the best UI designer for the kind of experiments that he's doing. He's perfectly fine with this. And honestly, I am currently also getting into another hobby of mine, like miniature painting. I'm really enjoying this. This is the thing I've, I've built a little tiny mini painting studio right over there.
This is my YouTube studio and many, many studios in another corner of my basement. And I've enjoyed learning about how colors work and how the acrylics work, the chemicals in resin. I'm 3D printing too. Like, all these little things that I can make, I really enjoy it. And I'm also thinking, Hey, this could be something in the future. Who knows? I'm an absolute beginner. I mean, I consider myself a beginner in any field beginner writer, beginner beginner, Twitter user, beginner engineer, because I know there's many people out there that are way better at what I would like to be doing that I am. But I enjoy the process of learning.
And by sharing this by teaching, I also get to share this with other people that may or may not find value in it so much that they pay me for it. And that's what Peter is doing too. He's learning AI, and he's just like using tiny prototype products to see if what he's learning can be monetized. What a mindset, right? That is, that's such a wonderful thing. How do you get to such a mindset, particularly when you come from an employment level kind of do what you're told and don't overextend? How do you change?
Yeah, yeah, yeah. I think it's important to think of, so I'm going to get to the answer. But I think what Peter loves, what Peter loves does a little well, which seems like he's he's running faster than everyone else is that he has this ability to keep things simple as you wear no things like and eliminate all the unnecessary things. And this is a hard thing. This is a requires practice. And I think the how to get better at that in identifying you know the 80-20 rule, like this idea that you can get 20 percent of the results with 20 percent of the effort. But it's hard.
Like how do you choose determine what is the like 20 percent to focus on? I think Peter is excellent at that. And I think like many things you get better with this with practice. And in general when we're going to a traditional color full-time job, we have a goal, we work towards it, like everything is what we create a gun chart and sort of everything is repulsized, repredictable. You will every day walk closer to your goal. We the muscle, right, that we need to make these decisions under uncertainty, right, to make these calls to eliminate things almost at the surface away.
Right, I felt this, right, and it's very hard to exactly articulate it, but I felt that when I was starting, everything was daunting. Like what should I leave? What should I do? But the more I do it, the better it feels. And I noticed this with the people in my small bus community, right, is that we have a get feedback channel and the general feedback is like you're overdoing it, you're over-thinking it. So I did this like the, and most of the time these are people who are new, right, they're starting their first thing.
And my best advice is take a small risk, right, take place, start doing things under uncertainty. This could be lighting a block post, right, I mean, lighting a block post requires you to choose where to write it, right, to determine how, you know, the templates, whatever, the colors, the title, the fonts. And you will start to realize that all those things are unnecessary, right, you are starting to exercise that muscle, right, but you just need to start to do it, right, and then you need to start sharing your block post, right, where do you share it, right, you post it here, there, whatever, right, and you start to notice, right, what is worth doing, what is not worth doing.
And like we tell you, for example, it's very similarly as well. I think you've replicated this block post, he said, I post a block post and I get like 200 views, I post a tweet and I get 100,000 impressions, and I think his block post you are now the directs to his Twitter account, right, I don't, there's a couple of days ago. But basically, it took him, you know, probably to come 10 years to come to this, right, but again, this is, I think the evolution of realizing how to best expand our energy.
And this is the thing, like when you're on your alone, and you have your own skin in the game, right, and you need to make ends meet, you need to survive. You just start to activate a part of your brain that needs to be good at using energy efficiently and time efficiently. And I think when you're in a very structured environment, you don't need that, right, you're basically, you're told that the goal of the company is to release this project by November 30th, that's a hard rule.
So now the only ambiguity that is is like, how do we, we know, split up the work between us, the five team members, right, and, you know, and then we just try to work hard to get to the goal. It's a very, very different domain. When you have infinite options, you can do whatever you can keep, you can keep sharpening your tools forever. I try to imagine our hunter-gathered ancestors, right, back 10,000 years ago and more, you know, when the tools became dull, they need to sharpen them, when did they stop sharpening them?
It was probably a gut feel that they developed, that they thought, oh, this is probably sharp enough. Yes, sure, I might be able to, I might encounter something that might acquire a sharper tool, but it's a gut feel. It's always subconscious. I was subconscious is smarter. I believe our subconscious is probably the smartest part of our brain when it comes to dealing with uncertainty. You know, our subconscious gut feel whatever you want to call it.
And I think when we're operating in a West structured environment, we almost turn off our subconscious. We try to, you're making data different decisions inside the company, you're working with your conscious mind with everything needs to be determined on a spreadsheet. What pros and cons, customer data, things like that. Whereas, you know, out there in the real world, you need to use your subconscious.
This fuzzy logic calculator, right, that needs to tell you, this is enough. This is not necessary, right. Again, Peter Levers, interior AI, I think he monetized it before he even had a login page, I think he manually sent out people like who paid, like a Google DYL or whatever, he didn't even decide the pricing, like he randomly gave people 10 different prices. That was fascinating.
Yeah, the experiment was really cool, right? Seeing also the results of his pricing experiments and then him choosing a price that was the best long-term kind of price, that was so insightful. Exactly. And the first decision, right? I mean, it's a daunting, what should this be pleased? I mean, it's not a market that's presumably announced. Like, is it architects that are going to be buying this individual users?
Is it younger people, older people? You know, why don't I offer you know 10 different prices and I'll make the call later, right? Again, it's amazing, that's very extreme, but I think it's the result of a lot of practice. Yeah, exactly. And he's experienced enough with it to understand that he will run an experiment where most of the outcomes will be people, you know, slightly unhappy, maybe they paid too much or you know, they expected more for what they paid, but there will be that one price that works where he will see more of them paid than in the other price brackets and that's the one he keeps.
And I think dealing with this kind of uncertainty and particularly dealing with the nine or 10 failures, you need to see the one success. That is something that is completely orthogonal to how we approach success in the employment world, right? Either it's a guaranteed success or we won't even try it. And here it's yeah, we have like eight or nine things that don't work, but we will find the one that works.
So this is a mindset that you have cultivated and that I guess successful founders have cultivated. How can how can people get there faster? How can they be have an easier time dealing with these little failures that lead to the equally small but noticeable success? Yeah, and I might be repeating myself here. I think the best way is to try many different things because once you start to realize that the thing that you were most bullish on didn't work and the thing that you least expected was the thing that paid off the best. It changes wires in your plane, right? I mean, you're it humbles you, right?
I mean, me, in my case, probably was the Twitter course that sort of revealed this to me because you know, the AWS book was something I was specialized in. I had a decade of experience, even though it's sort of still paid off better more than I expected, but the Twitter course on a whim, right? Very small project. And this thing made $200,000 and it's still taking like $4,000 a month. I still get a four five sales a day and I don't even know where these people are coming from. Like it's just who is like what's happening like almost three years later.
And I can't explain it like there's no evidence. There's no like if I look at my sales glove, just like at some point the gradient changed. I don't know why it changed. Like again, I basically this to me and you know, when I talk with successful founders, you know, I didn't wait and recently said something similar. Like I could have never imagined five years ago that I would be making money millions of dollars from a CSS framework, right? Again, right? And where he was doing different other things.
Like many of us, it was like to start a SaaS business, light and something like that. And I am again, to bring that the analogy with VCs, I think it's similar as well with VCs. VCs might be bullish on crypto, web 3.0, clubhouse, whatever and investing a lot. And then the thing that succeeds is some random thing that nobody expected. I think the good VCs understand this even though they try to be bullish because they try to hype things up, whatever.
They still know VCs will say, I'm going to liquidate all my investments and go all in into you. No matter how bullish they were in clubhouse, nobody just went all in, right? They might have written a check that was a bit bigger than usual. It's quite as big, five times as big, but they were still very, very diversified because they know, they know the things that they paid off in the past were things that they barely looked at.
By the way, I've seen this at Amazon, right? I mean Jeff Bezos, you could say cultivated a portfolio of small bets. Of course, at his scale, it rest itself is a portfolio of, I think there's probably now 200 plus products, right? And I can't defeat the numbers. I'd run by my NDA, but I can tell you that it's basically there's five making money, a bunch of them breaking even and a bunch of them losing money. And the ones that I'm making money were the ones that nobody knew, like this very simple thing, really?
Right? And same thing with Amazon in general, right? It best of slightly many things, the phone that failed the auctions, that failed lots of drones, you know, things that went nowhere and then Alexa or whatever ended up sort of blowing up, right? Which there was already competition and whatever it was in there, strong thing, right? And again, it just shows you the load of randomness and business, which doesn't mean business is all random.
Again, this is what people misinterpret me. I'm not saying business is all random or that skill is not important or that the market fit is not important, whatever, but there's a load of randomness being a desired place, the right time that is significant, right? And you can't underestimate it. And the best way to tame it again is to do the same way we deal with risks and uncertainty and financial diversify.
Right? I mean, we might think Apple is a great company. I wouldn't want to invest on my life savings in Apple. Why? Not because it will go to zero, but because some law in China might change tomorrow and suddenly the 11 years drop by 50% and then have the thing, you know, snowballs, who knows? That I mean, these things happen all the time. And the way with the tame that uncertainties by not going all in into weapon diversify and do an index fund or even better between different economies or currencies or whatever, and things like that.
Yeah, it's like what you've been doing with your own portfolio, right? It's very diversified. I love your your many info products and now you have a community going what what I do wonder because again, Peter levels, he posted a couple weeks or months ago a list of all the products he has ever done. And all the products that made some money was like four or five of them. And that was like 80 products that did not. That that is a pretty interesting ratio.
How is your ratio? Did you ever calculate like that at this point? Yeah. I think I have us somewhat better I think to be honest, Peter has been no, but Peter has been too harsh on himself. In that list, like he had the makebook which he considered like in the failure parts, but he made it made him like $200,000. But to him, it's not growing anymore. I think that's only four are still making money now. That's what he said, right? And and I think even in his case his ratio is decent. My ratio I think is around 50 per cent. I had I had a tweet recently where where I had like a cumulative sales of every product. And so there was like three three three products at the bottom like two products still growing. I think if you search for me and 300k, you might be able to find it. But yeah, that's right. I like this.
Yeah, your days on market versus revenue graph. I really enjoy I'm going to put it in the show notes. This graph has that that was inspirational to me too, particularly seeing how your small bets product, which is to me a mix between the course and a community, a co-core course really, but it goes beyond that, right? Do you empower people like on a long-term basis? How successful this has been. And it seems to me, correct me if I'm wrong, but every product that you launch gets to have a steeper curve in terms of revenue versus days on the market. Do you think that's random and luck or is that a result of experience?
It wasn't the texture. I don't think it was like that. I think so it was a little bit in the beginning because I mean user base was one of the lowest and then the eighth book was second, which was better and then the two records was better. But then I did the content boards. Yeah, that's right. I did profit and loss membership, which was my first attempt as a community. I started to build a community on circle. It didn't work.
这与质地无关。我不认为是那样的。我觉得在开始时有点像这样,因为用户基础是最低的,然后第八本书是第二,情况有所好转,而两张唱片又更好。但接着我做了内容板。是的,我做了盈亏会员计划,这是我首次尝试建立社区。我开始在 Circle 上建设一个社区,但没成功。
It incidentally, it is in a funny thing. You know, the small bets community, I didn't try to build a community. I just launched the course and I kept doing the co-horses. I kept repeating it and the community happened on its own. I wasn't mentioning a community at all on my landing page. I think I was lucky. I did the first couple of co-hors. The people were very active. I had set up a discord server just to share the cordings and the slides and the notes and whatever.
People kept coming up after the course and did that and they kept helping each other without my intervention and they built the first energy. Without them, I'm sure it wouldn't have happened. I didn't ask them to do it. I didn't do anything to help them do it. Except I was lucky. I think there was a place for them to hang out. And then as people continue to join, people started telling me, I signed up for the course, but I'm staying for the community. I'm enjoying the community more and people were actually telling me, you should probably start mentioning the community in your landing page.
And then I made that, I made another small bet. I made a marketing position. I started selling the community instead of the course. Now I'm selling it, joined the small best community and the course is free. I almost changed nothing. I still didn't do the course after the month. Instead of people signing up for co-horses to lever in and they have a fixed date. They joined the community and they can take the course whenever they want, as many times as they want, as they can join and whatever. And it worked.
I think it improved my conversion. It's better because it changed what I'm selling. I think it tapped a little bit in the fear of missing out. Our course, it's a course, education knowledge, but the community, more people I think want to be part of something. I think it helped me tap again into a pool of customers that probably I wouldn't have been able to do that. Then I did another small experiment. I started inviting speakers. This was another financial investment.
These are people I'm paying. I already spent over $25,000. I'm going to spend twice as that. Now I'm sponsoring some of the co-horses as well. Helping people to record courses will make them free for the community. Then the course creators can sell them on their own as well. Even though now it seems like I'm making bigger bets, it's not really that much. I mean, still to me, when I started inviting guest classes, I said, let's start an experiment with $5,000. I do five guest classes. Let's see how it goes.
People show up. People like it. To me, again, like you mentioned in my tweet, if I were to lose $5,000, will I lose sleep at night? No, I mean, this product already made a lot. Of course, I don't want to lose them. But I would still be some thought disappointed. I could never eliminate disappointment completely, but it wouldn't affect me in any material way. And same thing now. I'm still placing small bets on the community still.
I'm still trying to make it succeed as much as possible. I'm just not relying on it. I'm just aware that this thing next year might not make me as much money or any money at all in a couple of years. It's just the reality. Everything has an end date, right at some point. Well, I love the fact that you're always keeping your eyes open for potential ways of improving this and improving the portfolio through it. That's kind of what I see with this. I followed that. I followed your profit and loss. I found that very interesting because it gave people a very interesting insight into somebody trying to diversify their portfolio with a product that then diversified that portfolio. I love recursion. That's just the funniest thing. I just really enjoyed that.
And then seeing you taking the approach, but not the product and turning that approach into another product and changing that over time, super exciting. And I think highly inspirational. And that kind of inspiration. First of, thank you for sharing this because it's not not everybody builds in public the way you do. I know that you also use your public presence. Obviously now with what? 135,000 followers. That's significant. There's a lot of people. And obviously anything you do has a built-in audience, but then sharing your learnings and decisions along the way for other people to reach similar success and their own things just is a wonderful thing. So thank you for that.
Always been a big fan. And I know it takes time and it takes not just work, but also bravery in some way to talk about the things that do not work and that you're kind of doubtful about. So in front of an audience of a couple, you know, 100,000 people, that is substantial. I just want you to know that I find it inspirational, that many people find it inspirational. And that brings me to the last thing I kind of wanted to talk to you about because we're hidden time almost. And you said that recently, all the things that we talked about today, you said that recently, but I find that great that you find inspiration in scrolling Twitter for a while every morning.
That is something that goes so much against what most people think social media is. Like for most people, it's distraction, it's like doom scroll. And you said that that's where you get new ideas and new inspiration. As the final thing, can you say something about that and how people can use this interesting, let's just call it Twitter and interesting platform to create and to monetize? Yeah, yeah, absolutely. This is another realization that I think occurred to me over the last couple of years. Is that I used to think like many people do that ideas come in the shower, right? Or you go for a long walk and you sort of come back with an eerie comm moment and you have a good idea.
And I mean, of course, taking a long walk and thinking about something sometimes might help you optimize something, improve something, maybe think of a better name for your product or whatever, but usually I think almost always good opportunities happen when you embrace lend themness. You need some inspiration from the outside. And I'm going to tie it all so back to the VC movie studios book publishers things like the publisher who published teleporter. Right? It wasn't the executives who sat down in a board zoom and decided, oh, we're going to write a swimsical story about our 10 year old without it going to this day.
No, they just opened their inbox. They let lend them things come to them. JK rolling showed up one day and they just decided this might be interesting. Let's give it a shot. Same thing with VCs. Look at why combinator. They do the American idol like audition day. Like people come, pitch for 10 minutes. And they just say yes or no. They don't. It wasn't the VCs who thought about the box or Airbnb or whatever or Twitter or Facebook or everything. Then them things came to them. And I think we need something like this. And if I left one everything that I've done, I can literally find a tweet that inspired me to do it.
And sometimes it's something seemingly unrelated. But it opens my eyes to a new way of doing things. And then it's like a catalyst. And then I start thinking, what if I do something similar in my own domain? I remember this with their course because I had never done, I have never recorded myself on video before ever. And I'm an introvert. It's not something that comes natural to me. And I had this impression that video recording yourself on video was an extremely daunting thing. Editing the coding techniques, timings that I didn't have. Once I was calling to a tour, a tweet showed up from a person who I didn't follow even was tweeted by somebody.
It was a course on gum load about flipping pellets. It's called. It's basically this business site Hasselting where you buy the turned goods from Amazon and Walmart and whatever and you go to eBay and so I had to sell them. And this was $25. I was about to make, I was about to go for lunch and I bought it on a, just on a whim because I was curious. I wanted to see what this is. And what blew my mind was the presentation. Not the content, the content I learned something. I'm going to use it. But this lady here who created this course just took her iPhone started diving. Went to the car park. Listen, your first person mode went to the warehouse. And she's just explaining how she picks the pellets, which pellets are worth it, how she blinks the pellets to fit it in the car, mundane things like this. But it made it approachable. It made it feel like to me if I wanted to start getting into this pellet flipping business, I know what I do.
And it seemed like it was completely no effort for her. She didn't do any editing and recording like vertical mode, literally just iPhone. And it was okay. That the production quality wasn't necessarily. And there, I saw that on it, I think it was on a Thursday on the flight because I wrote the same thing in the back of my mind. I already thought I should do something with the knowledge I got to how to build an audience. But I was thinking should I write a book, should I, what should I do? I'd books felt daunting for something so visual. And this was a light bulb moment. I know what I needed to. I'm just going to create a Zoom meeting with myself, share my screen, press the card. And I'm just going to talk blame dump of what I do, what I tweet about, what I don't tweet about, how I set my profile, blah, blah, blah. I talk it to an hour. It took a bit longer. I didn't edit it. I didn't speed it up. I didn't cut anything. I upload to gun mode.
And again, like I, if I didn't bump into that and then tweet on that day from a person who I don't even follow, I would have missed out. Very likely I see $100,000 payoff. Probably it opened even more doors. And you know, this is just one example, everything that I've been doing. That was something random. And I, again, I think I'm not recommending everyone should be using Twitter, but everyone should find something that is an inspiration generator. And this could be like, for example, a podcast series. I mean, it used to be like your, like, you could be in the podcast. It's a good one. I excellent one. You hear people talk about how they set up their business, what they're doing, unconventional things, whatever. This podcast of yours might be a good example. Right? I mean, something that allows you to see things that until a minute before, you weren't even aware of.
That's what the thing. A great example of inspiration generator. My friend Peter Laske, you know him, the onions guy. I said onions on the internet. He is inspiration generator is every day. He looks at expired domain names. He makes a cup of coffee and morning. He's close to a list of over 100,000 expired domains. And it's fascinating. Ever the business he started. It wasn't an idea in the shower. He saw the domain. It sparked something and him speaks to him. That's using his own words. He bids. Sometimes he doesn't win it. But he once wins it then hits eyes to develop it. It's super, super fascinating. Very randomness driven and blazing randomness. And again, he's diversified. He's selling onions. He has job listing sites, birthday party services. So he tried access, which he sold later. Right, lots of different things. And he changes over time. Right as well. He sells things like sort of it's super fascinating person again.
Excellent. He's been doing the portfolio business for over a decade. And he and I think his special thing is like his own unique inspiration generator. And again, I'm not saying everyone should do the same thing. That's what's important for people to not just believe that they're just going to play storm and idea or an opportunity. I think we should be embracing randomness every day, bumping into random things as much as possible. I like that. Like seeding your inspiration by the random stream of whatever it might be. Right. Maybe you're on Reddit, maybe on Facebook, maybe on Twitter, maybe you're just checking expired domains, whatever you find that allows you to come up with inspiring thoughts. That is a wonderful idea.
And I've been like I said, been following you on Twitter and you've been very inspirational to me and many others. So coming to a close, where would you send people to be inspired by you? Where would you like people to follow?
Yeah, certainly Twitter, like Twitter. I'm not or I like Twitter a lot. I'm sort of sharing as much as I can on Twitter and the 2280 collector limit. So yeah, divasalo on Twitter. And if you ask me a question, I try to apply to everyone as much as possible. So this probably the best way to contact. Certainly do. You definitely reply to my question. So I'm really grateful for that too.
Thank you so much for coming on today. That was a wonderful conversation. Thank you for being here and bringing up all these amazing ideas that I hope people take. Always, always great to talk with you. Thanks for inviting me.
And that's it for today. Thank you for listening to the Bootser from the podcast. You can find me on Twitter at abitca, ARV ID, K-A-H-L. And you'll find my books zero to sold and the embedded entrepreneur and my Twitter course find your following there as well.
今天的内容就到这里。感谢大家收听我们的播客Bootser。你可以在推特上找到我,用户名是abitca,也就是ARVID KAHL。在那里,您还可以找到我的书《Zero to Sold》和《The Embedded Entrepreneur》,以及我的推特课程《Find Your Following》。
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