Fundable.com Founder On The Addiction Of Startups – with Wil Schroter

How does an idea guy launch multiple companies and how does he do it right?

Wil Schroter is the founder of Virtucon Ventures through which he’s launched Unsubscribe.com, Got Cast, Go Big Network, and other sites. His latest company is Fundable.com, which offers crowd funding for start up companies.

I invited him here to talk about how he launches all these businesses at once and what are some of the pitfalls.

Watch the FULL program

Wil Schroter, Fundable

Wil Schroter is the co-founder of Fundable.com, a crowdfunding platform for startup companies to take advantage of the JOBS Act, allowing anyone to get early stage funding for their ideas.

 

Raw transcript

Mixergy's audio transcription is done by Speechpad

Andrew: Coming up in this interview, are you a founder who keeps coming up

with idea after idea after idea but you never launch? Watch this interview

to see how today’s guest has launched multiple companies. And pay special

attention to what happens when he launched multiple companies and tried to

run them at once. All that and so much more coming up in this program.

First, three messages. Who’s the lawyer that founders in the Mixergy

audience trust? Scott Edward Walker of Walker Corporate Law. Have you seen

what Chris Pritchard posted on my Facebook page? His new company’s

incorporation pages that Scott Edward Walker helped him get. Scott Edward

Walker is the lawyer that publications like Forbes trust. Go to

WalkerCorporateLaw.com.

Next, when my friend had to close her company’s office but still wanted to

give callers the impression that all her employees work well under one roof

together what service did she use? Grasshopper. With Grasshopper everyone

who works for you could have an extension. They can pick up calls on their

extensions no matter where they are or what phones they use. And they can

transfer calls to each other, back and forth, with ease. Get those features

and tons more at Grasshopper.com.

Finally, when Dave Jackson and Dave Petrillo invented a product that keeps

coffee at the perfect temperature what platform did they use to create

their online store? Shopify.com. Look at how beautiful their store looks.

It’s because it’s built on Shopify. They did hundreds of thousands of

dollars in sales. Shopify stores are designed to help you sell. Patrick

Buckley invented an iPad case and used Shopify as his online store. Within

months he sold over $1 million in cases. Get your beautiful online store at

Shopify.com. Here’s the program.

Hey everyone. My name is Andrew Warner. I’m the founder of Mixergy.com,

home of the ambitious upstart. How does an idea guy launch multiple

companies and how does he do it right? Wil Schroter is the founder of

Virtucon Ventures through which he’s launched Unsubscribe.com, Got Cast, Go

Big Network, and other sites. His latest company is Fundable.com which

offers crowd funding for start up companies. I invited him here to talk

about how he launches all these businesses at once and what are some of the

pitfalls. Wil, welcome.

Wil: Thank you, thank you. Good to see you again.

Andrew: How many companies did you launch?

Wil: A total of eight in the last almost 20 years.

Andrew: All right, and there have been some hits as we’ll talk about here.

But there have also been a few challenges. And the challenges come from

something that you identified to me as, you said Andrew I feel a little bit

like a guy who was deep into drugs and now is telling everyone else to stay

off drugs. What’s the drug and what happened to you?

Wil: The drug is startups. The drug is the high of the next idea. I mean,

we all run into it. Every entrepreneur, no matter how successful, you know,

has this one other idea that he or she wants to pursue and is contemplating

whether or not it will interfere with anything that they’re doing today.

Having been through this gauntlet many, many times both successfully and

unsuccessfully I just keep coming back to the point where every single time

I’ve been successful I can map back to focus. And the moment things came

off the rails every time it mapped back to losing focus.

Andrew: All right, you know me. I’m going to ask you about the moment when

things went off the rails because I think we can learn a lot from it. But I

also want to learn from the successes. Give me, which is the company that

you focused insanely tightly on and how well did it do? And then we’ll go

back to the time when things didn’t go so well.

Wil: Sure, I mean I don’t know, up until recently I don’t know if I’ve ever

been more focused on one thing than I was in ’94 on Blue Diesel, my first

company. It was one of the first web design companies and in ’94 to be a

part of the internet was a big deal. For me, I think I was just turning 19

at the time, I was at a point in my life where I was really, really excited

to be doing something that was just kind of magical at the time.

As soon as I started Blue Diesel I put everything I had into it. Everybody

always gives you like the ridiculous stories of what they did so mine isn’t

really that much different than anybody else’s. I did not see my family for

three years. I didn’t take a day off for three years. I worked Monday

through Sunday all the time. You just couldn’t be more focused. Every hour

of the day was fully focused on the business and I loved it. At no point

was I dreading going into work. I was working that much because I was that

excited.

Andrew: Let’s talk about results. How well did Blue Diesel do?

Wil: Pretty well. In ’97 we partnered with a small traditional agency

called GSW. We had about a dozen people. They had about 30 or 35 people. We

combined the two agencies. A few months later, we won a big account with a

group called Ely Lilly, a big pharmaceutical company, for about $250

million a year. Today the company does over 2 billion in total billings and

has about 5,000 people.

Andrew: Fair to say that you boot strap that company with practically

nothing and ended up a millionaire in cash as a result of Blue Diesel?

Wil: Yes. Oh, sure.

Andrew: OK. All right. And then on the side you launched something called

HowardHouse.com. What was it, and then how did things go off the rails

because of it?

Wil: Yeah, it was a great idea with terrible timing. So like to put that in

perspective, [??] ’97 we do the deal with GSW, a few months later we win

this big life changing account. From there the agency just starts growing

like crazy. ’98, ’99 we’re hiring a new person every single day of the

year. We’ve hundreds of people at that point. The agency is doing great. We

have this great feel.

I get this idea because it’s dot com era, I can start this other company at

the same time cuz this wouldn’t be a problem at all cuz we have all of

these resources called powerhouse.com. Powerhouse was an idea that I wanted

to build an online version of Remax. I wanted to build an online real

estate brokerage where people could go online, pick the house they wanted

and then use a Powerhouse broker to bring them to the house that they

wanted to get into and actually sell them the house. It was, again, Remax

online.

I had a whole plan to roll up 170 franchises to get nationwide coverage. It

did about $8 billion collectively already in transaction. We had raised a

little bit of money to get out there. I put all of my excitement and time

and attention [??] 99 on this project at the expense of my existing

business which was the first time I saw first hand how incredibly painful a

loss of focus can be.

I’m out pitching everyday. I’m on the road. I’m talking to real estate

agents all around the country. At the same time what I’m not during, I’m

not showing up at my job, more importantly, all of the folks that work

there see me not showing up at my job. They see me thinking about something

else in the meetings. They hear that I’m working on something else. No one

goes to work for somebody that they really hope will just stop showing up

at the office and go start doing other things.

The loss of moral, the loss of enthusiasm connection to the company drops

like a rock. I think as a founder to overlook how important it is to be

able to have that connection to your group. It’s basically like getting

married and then telling your wife, hey I’m going to go start dating this

other girl. Right? It’s not going to end well. [Laughs] It sounds like a

great idea. It’s going to end terribly. That’s exactly what happened.

Even within the first few months as we were getting Powerhouse started,

again, separate group, etc., already I was getting rumblings that people

were leaving. This was at a time when we were hiring people as fast as

possible. It wasn’t like the agency was at a point where it was slowing

down. It was on a rocket ship growth curve.

Within I would say six months, a business partner sits down with me from

the traditional agency side and he said, “We got a problem.” He said,

“We’re getting kind of a powerless revolt back at the agency. Like,

everyone can tell you’re not showing up, and they’re planning on leaving,”

which is again a weird thing considering we were growing so quickly.

He said in no uncertain terms, he said, “Pick your poison. Where do you

want to be? All right, do you want to be starting this new thing, or do you

want to be executing on an existing business that’s already successful?”

considering all my income was coming from that existing business. You know

we shuttered Powerhouse. We didn’t, again, we hadn’t taken it into market

yet. We’re still forming it.

As soon as I came back and I had kind of announced to everybody that I

wasn’t working on something else, everything changed. All the people that

were just about to leave came back. All of our clients . . . we were

getting killed with not delivering with clients, missing all of sales goals

and everything else like that. Everything changed, like, within a month. It

was so acute, and it was the first time quantifiable I could see what

happens when you lose focus.

Andrew: So, you and I have known each other for a long time. I remember you

used to come over to our place in California when Olivia and I lived there

and when you lived there, one of the things that I always felt from talking

to you is that you were just constantly launching stuff. I always wondered

if I was doing the wrong thing to focus ju-, maybe not the wrong thing but

maybe I thought am I weak to not be able to do more than one thing at a

time.

I always my whole life either did only Bradford and Reed back in the day or

only Mixergy today but only one thing at a time. I noticed that you had

launched unsubscribe.com which I admired the hell out of, Godcast, whose

founder was on here, gobignetwork who must have done millions of dollars

in revenue for you and so many others our last conversation It think when I

was leaving LA was check out what being around people can produce when

you’re around other entrepreneurs you can create projects like

unsubscribe.com. So the thing I’m asking is, you were the evangelist on the

other way of life, of constantly launching and something happened now that

you’re focused just on fundable. What was that thing that changed your

whole out look that took you from where you were to where you are today?

Wil: I think it’s, not the last company, unsubscribe, but the company

before we worked on affordit. At the time I think that was maybe the fourth

company in parallel that I’d started and was actively running and that

required a tremendous amount of effort. We raised money from quite a few

VCs.

Andrew: I remember I practically begged you, I remember the street I was

hanging on. Just say dude let me put money in this thing it’s such a great

idea and you’re such a freaking sharp guy I want to be a part of it. So

what happened with affordit?

Wil: It just didn’t grow, it didn’t fail but it just didn’t grow so it’s

kind of on a flat line and as you know with web start-ups if it’s not

growing, you know, it’s not a success right? And prior to that when I sat

down with you and I started to explain to you that idea, we had just

launched gotcast and that had been venture funded, we had gobig, we had

just launched bizplan.com and we had just come off of swapalease.com and

you know when you’re doing multiple things and it’s going well, it’d be

like having multiple kids and if all the kids are healthy and everything’s

fine you feel like the greatest dad ever. As soon as stuff goes wrong

that’s when you realize it’s a problem right?

Andrew: Yeah.

Wil: So as soon, with affordit, we needed to start raising money, we were

going to ruin out of money. OK, I’ve got and urgent issue here. Well then

gotcast needs more money, oh shit I’ve got an urgent issue over there and

now we’re cycling up with unsubscribe.com and that sort of needs some

money. Well now I got an urgent issue over there, right? This concept of

having so many things that you have to focus on at once that need critical

attention, that’s where things start to go wrong. Like with bluediesel, the

agency and powerhouse for the first couple months, everything was probably

OK because people hadn’t decided they were going to start quitting yet.

Powerhouse didn’t have any real deliverables yet but the moment things

start to go wrong when you’re doing multiple things or I assume maybe

exponentially right, it falls apart.

Andrew: You had some of the best advisers out there, was Mike Jones an

adviser?

Wil: Yeah, that’s a great adviser.

Andrew: Mark Suster an investor and adviser?

Wil: Yeah, absolutely.

Andrew: And so many others, I mean Mark Suster one of the top venture

capitalist. Mike Jones one of the top investors in southern California,

maybe even in the world, used to run MySpace, sold a company before that to

AOL. These guys are very experienced people they must have told you

something about focus, when you listen to that feedback and you push it

back, what’s your thought process then?

Wil: The first is that they were spot on, the problem is that they were

giving me advice at a time when the advice wasn’t yet a problem, right? So

Mark was very specific when he made his personal investment, which I

appreciated a lot, to say you need to stay focused on this and I know you

got these other things going on. When I told I Mark I’m going to stay

focused on this there weren’t any problems with the other businesses. They

were all being run by other CEOs like Alec at gotcast, that you know is a

great CEO.

Andrew: Yeah.

Wil: And so at the time there just weren’t any other issues so it didn’t

occur to me that these things could happen. But again would have affordit

gone different if I didn’t have the distractions? Probably not, you know, I

think some of our growth issues had to do with needing an extraordinary

amount of capitol in order to grow and that was the real challenge. But

it’s certainly didn’t help you know. And again looking back on the advice

those guys gave me, it was spot on and again, had affordit raised and

ungodly amount of money and those other problems come up that would’ve been

a real challenge.

Andrew: Because suddenly you have the big responsibility of a lot of money.

A crisis and then multiple crises out there I see.

Wil: Yeah.

Andrew: So it’s kind of like, you know what? I kept getting knee pain but

even though I read the books about barefoot running I brush it off, who

cared and my wife would take Olivia, took a course on how to run properly

and I just kept blowing this whole thing off thinking you guys are all

following a fad. It wasn’t until I did this four day run and my knees and

my legs hurt so much on day three that I finally said I can’t continue I

got to at least learn how to run better and I changed my form and now I

don’t have any knee pain anymore. I had to feel so much pain on a tough run

that meant something to me to finally open my eyes to the advice I’d been

reading for a long time. You’re saying that’s what it is with

entrepreneurs? We have to feel the pain sometimes to understand the lesson,

to be open to it?

Wil: There’s no question about it. Like I said, all of us as entrepreneurs

feel like we can at least do two things at once. Because we have so much

energy to be able to put into our one project, we assume that that can

translate into two. Every now and again it can. You’ve read how Steve Jobs

was doing XR and Apple at the same time. I also think, if I recall

correctly, at the same time he said he was making regular trips to remove

kidney stones. So, you know, even Steve Jobs has a breaking point in trying

to do two things at once.

I think from my own standpoint, trying to focus on one thing is hard

enough. As soon as you separate your focus across two, three, four things,

it doesn’t add up. One plus one equals negative one at that point because

you literally take yourself off the critical path.

Andrew: What about this? The fantasies that a lot of people have is that,

we’ll hire great CEOs who will run these businesses, and you had that, and

they’ll deal with these issues while you just sit back and be the adviser,

basically the chairman of the board. What happens in a start up situation

when you do that?

Wil: I think it’s unrealistic to think that that’s going to happen unless

you have massive scale, almost like unless the company’s already

successful, that said, there’s all kinds of situations, you know, that you

and I read or people we’ve met where that actually worked out. I think it’s

something that works out in spite of itself, you know, not because of

itself. So I think . . .

Andrew: Why? Why doesn’t it work out? Why can’t I just say, I’m going to

hire a guy whose basically as good as me and I’m going to give him the keys

to the company and I’m going to trust that when it’s time to raise money

he’ll raise it; when it’s time to solve a problem he’ll solve it. He’s

running the show.

Wil: You can’t hire founders. That’s the problem. You are the founder. Only

one person has founders blood and everyone else who’s not the founder, and

I’ve had long hard conversation with CEOs that I’ve worked with as well as

CEOs that brought in other businesses. There’s just something odd about the

fact. The founder has this special place that’s hard to replace. I’m not

saying he’s always the most qualified guy. There are many cases where

that’s not true.

At [??] we tried on four separate occasions to replace me. I was trying

like crazy to find my replacement cuz I wanted to go start other

businesses. On four separate occasions we hired what we thought was the

best person at the time. They came in, blew up . . . this is me trying to

get out of the business, so it wasn’t me trying to [??]. We couldn’t

replace the founder. It was actual a terrible [problem]. It wasn’t

something where I felt so wanted at the agency. I felt tethered. I felt

chained to the agency.

Andrew: Wow. All right, let’s go back now. We’ve talked a little bit about

the challenges of it. I also want to learn from what you’ve done right. I

mean the fact is that you launch. You don’t just sit around with your ideas

and talk about them over drinks with people and never get anything done.

You did launch Go Big Network. You did launch Afford It You did launch

[??]. I want to know how you did it. Maybe I should explain to people what

some of these projects are or some of these businesses are.

Go Big Network is a social network where entrepreneurs can get funding and

[need] investors. Biz Plan is a place where they can write their business

plans. Afford It makes it easy for people to buy expensive items like

computer, by charging it, basically, on a lay-away plan. You pay a little

every month until you get it. [??] . . . these are so many, man. [??]

allows talented people to look for gigs for themselves and to network with

other talented people. Unsubscribe lets you unsubscribe yourself from

different email lists. It actually ended up going into reputation

management.

I doing a disservice to all of the businesses by giving them one or two

sentence descriptions. They’re way more complicated. Give me one that you

did . . . show me, teach me what you do to launch all of these businesses

in a world where most people can’t even launch one. How do you take an idea

and get it out there?

Wil: We take it in really small chunks. We assume in every case that our

core thesis of what we think it’s going to do is almost always wrong if not

somewhat flaw. You know, we just launched a business yesterday

fundable.com, [??] funding for start ups. We have a thesis that companies

would want to be able to use [grad] funding to expose their funding on the

web. We could be totally wrong. Time and time again, our thesis is wrong.

Go Big was started as a classified ad, like, Craigslist for startups.

People used to post jobs and talent gigs on there, they’re posting listings

for mentors, office equipment for sale and it turned out all everybody

cared about was posting essentially classified ads, to say I am looking for

funding and it kind of went that direction. Time and time again, we stuck

with the thesis and we would keep testing, we keep trying to find out what

part of it makes sense and work toward that.

Andrew: How do you do that in such a…? I have seen this a lot in past

interviews of course, the idea of going small, seeing if people like it,

improving what they like, get rid of what they don’t like but when you’re

talking about…, We should talk about Fundable in this case, when you

launch Fundable.com, a site where people can fund their ideas, I am seeing,

[??], ‘ride any clip less bike pedals bike with street…’,actually it

shouldn’t be clip less, should it be, ‘ride pedals and street shoes’, maybe

it is, ‘clip less’. It’s basically this guy is looking for funding for this

pedal. You have to have a process to collect money, you have to have a

process to make sure that people aren’t ripping you off, you have to have

regulatory issues to be taken care of, there’s so much to do. How do you

launch a small idea, a small test when there is so many obligations to get

this right?

Wil: It’s a great question. Crowd funding is wildly complex because we are

going to get into a world, we are getting the securities, we are going to

get into brokerage and all these other issues. So right now the reason we

are staring of with a really simple mechanism, which is essentially called

pledge based, which is similar to something like kick starter. All that is

happening here is people are essentially pre-ordering the bike [SP] pedal

in order to fund this [SP]. So if he collects $25,000 for the pre-orders,

he will be able to buy the mold to be able to go produce the product and

send it to everybody. Its sales based and [SP]. There is no complicated

securities here, etc.

The thesis that we are testing is what happens when you do a very

articulate job of expressing your business idea, how will people respond?

Wil they understand that this is something they want to support and will be

supporting? If that thesis is true, that’s why we are testing with 5

companies not 500 so we can stay focused on that thesis. If it’s true, then

there are other ways people can fund their ideas as well right? So we can

do equity based funding, we can do debt based funding, we can do revenue

shared based funding, there is all kinds of stuff.

Andrew: Let’s first see how anybody understands how to react to a startup

before we go down any of those paths

Wil: Is somebody in the background by the way?

Andrew: Somebody is cutting down a tree right now.

Wil: I see!

Andrew: We [??] …sorry about that.

Wil: It happens to Charlie Rose all the time. I was watching an interview

with Henry Kissinger the other day there was somebody chopping down a tree

right behind them.

Andrew: [??]

Wil: This [??] by the way is why I spent half an hour with you before the

interview pushing you for those vulnerable spots in your story, this is why

when we talk I say, Let’s see if we can make this the most freakin’ useful

thing ever so if there is a guy chopping a tree in the background, it’s

still so useful that people listen to it and remember it and thank us both

the years from now when it does well. We have to overcome so many hurdles.

Andrew: Well this guy is now moved closer to me and, and there is multiple

guys with chainsaws walking toward me.

Wil: No its OK, this is the story by the way, I’ll get distracted for a

moment and say, this is basically the story of ethnics in America, the

immigrants who come in, they get…nobody cares, people put obstacles in

their way and they fight so freakin’ hard to overcome them that they end up

doing well in this country. This is the story now of the new immigrants of

the Internet, guys like me who come with nothing, how don’t have the

television background or any of that and we come in with all these

obstacles and we have to get so much freakin’ better than everyone who is

on regular television and who is a pro that we become better than them.

Years from now, people watching this and saying, “That’s how Andrew got

trialed by fire”, that’s how you learn to become such a great interviewer

and so useful for me. Your nodding, you got something to say? What were you

going to say?

Andrew: Oh I was going to say. How do you test ideas before you get an

offer?

Wil: I want to tell you a story about unsubscribed because I think its…it

really goes along the lines of how we test ideas and market.

Andrew: OK

Wil: I had the idea for unsubscribed, this is a couple of years ago I’d say

by now. The idea was simple, hey what if there was a button in your email

client that would allow you to unsubscribe from any email, the same way you

delete emails and so I socialized the idea with a couple of folks around

Santa Monica, who is a brilliant entrepreneur with Multiple exits, Josh

Rock another great entrepreneur who has been on a couple of exits as well.

They like the idea a lot, and they talked about how do we take this idea to

market and I said before we build any level of infrastructure and the idea

of building a mass tool for unsubscribing is really hard to do because

theoretically, there’s millions of different unsubscribe pads as far as how

people check out of their unsubscribe so to speak. So you need an algorithm

to understand all of them etc., really complicated.

But the reality is none of that matters if no one ever hears about your

idea, if no one ever downloads the tool, or no one ever tries to use it. I

sat down with the guys and we talked about kind of what MVP was. This is

like week one. I said hey, look, I’m running Afford It. I can’t run this

but here’s what I can offer you. Let’s build nothing but a site called

Unsubscribe.com. A way to download this button for a handful of clients and

when somebody clicks the unsubscribe button have it email it to an

Unsubscribe Gmail account. Then we’ll just go figure out how to unsubscribe

from that email. We’ll literally open up the email and click it.

I think it was Josh at the time saying that sounds ridiculous. Like it

would take us nine months to build an algorithm. I just said hey man, it

would. Or we can just do it manually to see if anybody even cares about

this idea. I think that’s such an important point because I think when

we’re talking about burning lots of cycles with new ideas it comes down to

oh, well I have to spend a year building all the infrastructure to test

this. I think those barriers are changing and I don’t think that’s

insignificant. I think you can test an idea, a real market idea, with a

small MVP and then decide whether it’s worth building out the rest of the

store front.

That’s what we did. When we launched it we were able to get some Tech

Crunch press. I think Jamie had talked to Fred Wilson and Fred wrote about

it. The moment that went out our site went crazy. We had people signing up

so quickly and, mind you, when that all went out there wasn’t a system in

place. All those emails were just coming into a Gmail account and we were

just rifling through there trying to click the unsubscribe link in all

these emails.

Now, it sounds goofy but at the same time, you know, all of those people

that were using the service were getting exactly what they had expected,

right? Whether there was this incredible Google-like algorithm that was

doing all the work or whether it was just us clicking unsubscribe links as

fast as possible they didn’t really care as long as the job got done. But

it allowed us to get out to market quickly without spending lots of cycles

building this big system. Because we figured if the demand was there we

could build a system to account for it but let’s not build a system and

hope that there’s demand.

If it’s OK I just want to stick on this point for a second because I think

we’re starting to see a huge shift in how people are testing ideas,

actually that have the ability to test ideas. An example, that bikedabs

product that you just referenced on Fundable, it doesn’t actually exist.

There’s a prototype that exists but the product itself, there’s no

warehouse of 25,000 bikedabs somewhere. But Curtis, the entrepreneur, is

going to be able to raise money against the idea, just the prototype

itself, get paid ahead of time with all the funding he needs to make the

mold, to make the actual product. And then take the product to market. He’s

literally testing the idea the same way we just did with Unsubscribe but

with a physical product.

With crowd funding, just the way it’s changed consumer mentality I’d say in

the last 18 months. You saw it with the pebble watch on Kick Starter, we’re

now in an era where people can actually sell the idea first and then go

make the product. That didn’t exist three years ago.

Andrew: What about getting people to pay attention to it. That if Fred

Wilson hadn’t blogged it and Tech Crunch hadn’t blogged it you wouldn’t

have had enough people looking at the idea and then interacting with it to

give you an understanding of whether it worked or not. What do you do to

get people to try it out?

Wil: I think that’s where, you know, small but accurate Facebook CPC

campaigns, Google CPC campaigns. The old Tim Ferriss approach of, you know,

test the landing page. I’m a big fan of anonymous traffic because I think

when you get a Tech Crunch press like we did I don’t think its

representative of your market in most cases. Unless that’s exactly the demo

you’re going after. It also exposes you. I mean, what if our product didn’t

work when we got all that press and traffic, right? You’re better off with

a testing mechanism like CPC where you can actually throttle it. You know,

hey let’s try it for a few days and if it works, great. If it doesn’t,

let’s peel back and try again.

Andrew: I remember talking to Eric Reese about that. At the time that he

started advocated that people go and buy ads on Google ads were pretty

inexpensive so you could just rip through some cash quickly and get a lot

of traffic for that cash and get results. By the time we did our second

interview it got expensive and it is very expensive today to buy that kind

of traffic.

Wil: It is, but you also have other sources. Now you have Twitter, you’ve

got Facebook, you’ve got, you know, other ways that you can drive traffic

without having to necessarily, you know, do a huge Google ad spend.

Andrew: How many people do you have working on Fundable now?

Wil: There are 20 full time people.

Andrew: 20 full time people.

Wil: Yeah, we’ve got 12 people doing product review for the different

clients that we’re bringing onto the site. We’ve got hundreds of clients

that we’ve interviewed and sat down with and said OK, we think you’re a fit

and we’ll be rolling them out on the platform. Then we’ve got eight people

doing product delivery.

Andrew: I noticed on the bottom of your site, on the bottom of Fundable.com

that there’s a note here about how pixels and code carefully crafted in

Santa Monica, California and Columbus, Ohio. I’m assuming the developers,

are they in Santa Monica?

Wil: We’ve got a few people in Santa Monica and the rest of the balance of

the folks are in Columbus.

Andrew: I’ve got people who help me with Mixergy all over the world and

it’s really cool to have all of those people to tap into when I have

issues. But what I’m finding is a lot of our interaction is like CB radio

where I need them to learn how to do new course editing but if I give them

the whole process of how to do it then there will be a mistake somewhere

and it will be too complicated and we’ll have issues. So I give them the

first step. They listen, they try it. They come back to me for the second

and so on. Every interaction seems like that.

To the point where I hired an editor in Guatemala a few years ago. I’ve

been working with him forever. A few weeks ago I got so frustrated with

that kind of interaction I said how much is a flight to Guatemala? It

wasn’t too bad. I flew out there. I spent a day with him. We just got

through so much work together that it felt like it was two months worth of

work the way we ordinarily function. I thought this is one of the problems.

It’s not my interaction with people, it’s the distance. How do you deal

with distant conversations and distant management?

Wil: It’s really hard. I think the other piece that you probably tuned into

is the fact that email, IM, etc., it’s pretty one dimensional. If you don’t

really have a human conversation with somebody for some period of time the

relationship falls apart. If I say hey, did you get this done and that’s

all I wrote in my email, there’s no emoticon, there’s not a smiley face or

something, I kind of sound like a jerk. Right?

Andrew: Yes! Yes, I sound like a jerk all the time. I’m so glad that you

said that, you’re right.

Wil: From time to time, even though it’s kind of old school, I just pick up

the phone and ask the same question. Especially when I actually, before I

hit the send button I look at what I’m about to send and I’m just like, you

know, could that come off the wrong way? More often than not it does. It’s

funny because sometimes I’ll send the email and somebody will get it and

I’ll call them like an hour later. Just because in the back of my mind I

know that something’s off. And it’s like you know what, I’m really glad you

called because I thought you were pissed. No, I didn’t have time to write

more than did you get this done? This isn’t me being furious.

I think the team dynamic about people being spread across locations isn’t

insignificant. I think it’s very real. There’s sometimes a benefit to it.

Like I know there’s, our developers in Santa Monica enjoy me not being

there sometimes so I’m not harassing them all the time. But they’re here

now. They flew in for our launch on Fundable yesterday. We all did a big

party together last night, you know, and drank together and hung out with

spouses and things like that. You can’t replace that. That’s so meaningful.

I notice that when we’re apart from each other too long it starts to get

brittle. It’s like any other relationship. It matters.

Andrew: You know, when I worked for Dale Carnegie, the instructor who I

worked with, when I went to lunch with him he sat with his back to the

door. He always did. It turns out he had this issue where if he was facing

the door he was constantly looking to see who was coming in, to see what

was going on. To solve that problem he just sat with his back to the door.

No more problem. No needing to work on will power while you’re trying to

eat lunch and focus on a conversation with a friend.

As a person who used to, I see this smile on your face. You know what it’s

like, you sometimes those kind of tactics. As a person who used to spread

himself too thin, who used to focus on too many things, what are you doing

to ensure that you stay focused on Fundable right now?

Wil: You know we spend, I spend a lot of time thinking about what my next

gig would be. And what I was looking for was something that would allow me

to kind of chase multiple paths but do it under the same umbrella. That was

what Virtucon was. Virtucon is an incubator so we could work on multiple

companies and get into multiple things at the same time and have that make

sense. That was what the ad agency was for, so we could work on multiple

clients and kind of shift focus and have it all be under one umbrella.

But what happened was we just liked starting lots of companies and getting

involved in lots of companies. With Fundable it was hey, let’s just get to

the point of it. Let’s create a company that helps create companies. You

know, let’s sit around and talk to start ups and think about start up ideas

all day long and just make that our job. I think if we had taken that path

five years ago we wouldn’t have gone through, we wouldn’t have learned what

happens when you start multiple companies and it becomes really

challenging. Now we get to work on tons of companies. Like our offices here

are like ESPN for startups. I mean we see so many start up pitches all

throughout the day, we’re trying to help so many companies.

Andrew: Because they’re all trying to get on Fundable.

Wil: Yeah, yeah, and it allows us to really dig into their ideas. We see so

many cool ideas. But we get the high of all these new start up ideas

without having to go start more companies.

Andrew: How do you, I’m sorry, how do you compete, I’ve got to get back to

where you come up with your ideas and how you launch them and focus on how

an idea guy builds businesses. But if I take a step back and say the

elephant in the room is Kick Starter. How does Fundable.com, a new company

that’s in this space, compete with Kick Starter that just did the pebble

watch, that has had so much time to build name recognition?

Wil: Oh sure, Kick Starter’s awesome but it’s just not our business. That’s

a little bit of a misconception that will become more obvious over time.

Most businesses have no use for Kick Starter. It only works if you have a

business that specifically can do a pledge based crowd fund or an affinity

based crowd fund. Like you see something like the pebble watch, which is an

anomaly at every level, but…

Andrew: Right.

Wil: If you have a product to sell. But if you don’t have a product to

sell, let’s say instead you have to sell some early equity like we did with

Afford It or Unsubscribe or anything else like that Kick Starter can’t help

you at all. Crowd funding can because now you’re going to start to be able

to open up your fund raise to lots of people that you didn’t have access to

before. But Kick Starter won’t help you.

Andrew: You mean because with Kick Starter you need to sell a physical good

or experience, in the case of a concert, but here you can sell something

that’s not physical?

Wil: Correct. Also, there’s two pieces to it. One is Kick Starter is pledge

based. Again, if you don’t have a pledge based offer to be able to fund

your company Kick Starter is useless to you.

Andrew: What do you mean by pledge based?

Wil: Pledge based would be like something that I can offer a pledge or

donation to your organization. For example, a lot of stuff on Kick Starter

is affinity pledges which is hey, I just really like this idea. I really

like your poetry book so here’s a pledge or donation. That works for the

arts because it’s a patron based economy. When you get into commercial

projects like start ups, etc. the concept of I’m just going to give you

money for no good reason doesn’t work so well. It falls apart quickly. The

only time it holds up is if you’re doing pre-orders. That’s all that pebble

was. It wasn’t so much crowd funding as much as it was just a pre-order of

a product.

Andrew: Can you give me an example of a product that would work on Fundable

but not on Kick Starter?

Wil: Yeah, pretty much any website for example. Like we’re doing a pledge

based website fund raise for Tack right now. It’s working pretty reasonably

well. Tack can offer different rewards, if you will, for helping pledge

toward them. But ultimately to raise real sums of money, larger sums of

money, you know north of $100,000, $500,000 it’s going to require an equity

based platform. Someone’s going to need something better than just a reward

in order to drive that.

Andrew: Ah, I see. Tack is the simplest way to create and share elegant web

pages instantly. That’s a software they’re trying to build. If you put

money into it you get a share of the business?

Wil: Not in this case. We won’t be able to do that for a few months until

the SEC lets us.

Andrew: Ah, I see. OK, so then are you running the right small tests? If

the big vision is give people equity in exchange for having them fund a

business then is the minimum viable test a real indicator of whether

people, I mean is it connected to that enough?

Wil: Yeah, it’s been fantastic because it’s all the people that aren’t

pledging that are what you’re really testing. My friends are hopping in and

they’re saying I love this business. Tack’s a really cool business. I love

this business, I want to get involved but I don’t want to pledge. I

actually want to invest in a company. I had a friend contact me yesterday

who said I want to invest $5,000 to this company. Where can I do that?

Right? What we’re learning is that there’s a big market of people that

don’t want to do a pledge. That actually want to be doing equity

investments instead.

Andrew: How are they telling you this and how does the launch, I’m on the

site right now. It looks very similar to Kick Starter where if you put

money up you get a t-shirt, you get a poster, you get a limited edition

poster, a nickname of a font, all based on how much money you give you get

one of those different rewards. How are people seeing this and saying to

you no, we need equity in this thing. Oh, I see on the right side there’s

equity. You’re trying to see are people flipping from pledge rewards to

requesting equity investment in the company and if they are that’s how you

know that people are asking for equity and that this idea works.

Wil: Absolutely. The other side of it is by having the site out there it’s

given us an opportunity to interview hundreds, probably thousands of start

up companies that want to do a crowd fund. We see a fair amount of them

that say hey, I want to be able to expose my idea to the public. I want to

be able to raise money publicly. But I don’t have something, I don’t want

to give away t-shirts to do it. You know, I want to look for equity

investors. By having a platform out there we’re already starting to see,

too, how many start ups are compatible with a pledge based capital system.

Andrew: I see. Let’s see, going back to launching a business and getting

people to run it. How do you find the right people? What’s your way of

finding people?

Wil: You know, I think the people I tend to work with are based on people

that are just as excited about the idea even if their core competencies

aren’t exactly in what we’re about to do. Like me, Jamie, and Josh doing

Unsubscribe. None of us had any real experience in the email space

whatsoever or marketing software like that. But we were all passionate

about the problem we were trying to solve. What I have found is if you can

find passionate people you can work with them to get done what you want to

get done. But you can’t find people that are exactly the right fit for the

product but don’t have passion. Like you can’t create passion but you can

teach people the space.

Andrew: How do you find people who are passionate about an idea that

doesn’t exist?

Wil: Do you remember when you and I used to just sit around and talk about

ideas? Like when you were starting Mixergy, etc.? Like that. It’s always

just me sitting with somebody over a beer. [Dock Cast] came from me and

Alex from Godcast having a beer. I had no interest in being in the casting

business. But it was he and I sitting in Hollywood having a discussion

about how he as an agent was having a huge problem with recruiting talent

from all this new wave of reality shows. I asked him well, why aren’t you

just finding it all on the internet? He said surprisingly nobody is doing

that. Six months later we’re in the casting business. Every one of those

businesses was a serendipitous conversation like you and I had that led to

a business.

Andrew: You’re listening to them. You’re hearing them express their problem

and then once they do you say well, why isn’t there an online solution?

Fine, they say no one has it. Now you see that there’s an opportunity to do

some of this online. But I want to know more about how you come up with

your ideas. Because I, how do I ask you the right question? Let me turn

this around on you. Because I’ve had tons of conversations with people that

never led to ideas, that led to bitch sessions, that maybe even if we tried

to come up with an idea it didn’t necessarily lead to it. You’re a guy

who’s come up with lots of ideas. Teach me a little bit about the process

of coming up with these ideas.

Wil: I don’t try to come up with the idea but I’m just naturally

inquisitive. I remember you and I sat down at Bar Chloe when you were

coming up with how you were going to take Mixergy to market and how you

were going to charge for it and everything else like that. If you recall I

just asked you a thousand questions. It wasn’t me being critical of the

idea. I was genuinely curious about where your head was at, right? A lot of

times, and these are all the conversations I have. I just ask a million

questions just because I’m naturally curious about why people want to do

what they do. Sometimes those lead to businesses but I’m not actually

looking for a business idea.

I mean I do this all the time. I’ll be at a hotel and I’ll start asking the

concierge like where he’s getting all his business from and what keeps him

busy and what he does in his down time. He probably wants to kill me but

like I’m just curious because out of that may pop an opportunity to change

the concierge business. I’m not looking for a concierge business idea. I’m

just interested in what the guy does all day and why.

Andrew: And then when you come up with an idea you tell them and you say

hey, what do you think of this idea? And you see if he’s excited about it?

Wil: All the time. You know, if I were to have come up with the idea for

Open Table it would have been because I was standing at a hostess stand for

way too long and I would have just asked her, you know isn’t there some

easier way to do this? And just had a conversation and realized that she

should have a kiosk in front of her and we should go build a service that

has everybody make their reservations online. It’s just, in every one of

these businesses there wasn’t a single business that I could have said a

year before that I was going to be in that business. I just kept asking

lots of questions and it led to, you know, what might have been a business.

I’ll give you another example.

Andrew: Yeah, go for it.

Wil: A few years ago my brother called me, he lives in D.C. He had just

gotten out of culinary school. He said hey, I want to buy a Nintendo Wii.

He said do you know anywhere I can buy it and finance it? Which I thought

was the most bizarre question at the time. In fact, this is probably in the

[Afford It] interview. I was like dude, why do you want to finance a $250

item? He said, and again this wasn’t me being critical. I was literally

curious why exactly would you want to do that. He said hey, I don’t have a

credit card. I don’t like debt. I don’t want anything that would kind of

tether me. However, I just want to buy this item and pay it off but I just

don’t have the cash flow to have $250. I make $10 an hour. I live in DC,

which is like making -$10 an hour. He’s like I have $200, $300 a month of

just spending cash which includes food so it’s not really disposable

income. But I can pay it off through…

Andrew: I might have just lost you. If we did, I’ll call you right back.

Wil: …year like this.

Andrew: Sorry, so you were saying that he said I have a little bit of extra

money every week and I could use it to do what?

Wil: He said I could pay this off in a relatively short period of time,

probably six months, I just don’t have all the cash up front. I said to

him, I said how often do you have this problem? He said probably a couple

of times a year, if I want to buy any item over a few hundred bucks. I

instantly hop onto Google and I say monthly payments online. I’m trying to

dig into it and that’s where the idea for Afford It came from. If you asked

me the day before if I wanted to be in the online weekly payments business

I wouldn’t even have thought of it.

Andrew: You immediately go online and you say is there a way for my brother

to go do this? Why didn’t you, well when you asked him why don’t you get a

credit card? Just buy it and then you can pay them off every month, what

did he say to that?

Wil: He said I don’t think I’ll pay it off. I don’t want to incur like

extra payments because I hear about people getting stuck in credit card

debt. Which was actually a really observant thing to say. That’s exactly

what happens. I looked at it and said how can I build a system that would

allow him to make this purchase that would, I hate to use the word, but

force him to pay it off. Like it wouldn’t give him a minimum monthly

payment that would drag the balance on forever so I could make percentage

fees. How could I make sure that he had to pay it off in four and a half

months and it had to come out of his paycheck, auto-debited for a small

amount every week in a way that he could afford?

Andrew: I see. The idea is he says I want a Nintendo Wii. You say great,

you’re going to have it. Every month we’re going to take this amount of

money out of your paycheck and then at the end of whatever this set period

is you’re going to get your Nintendo Wii. The reason you’re going to

continue to do it is if you don’t pay then you don’t get the Wii.

Wil: Absolutely. And I really wanted to create essentially a forced savings

account. The trick was it wouldn’t work unless we shipped the product first

and hoped we got paid back which is pretty challenging.

Andrew: Were you, by the way, planning on sending it out first and then

taking the money out?

Wil: Yeah. I mean the reality is otherwise it is literally a forced savings

account which is fantastic but the value proposition isn’t as strong.

Andrew: OK, so you give them a Wii and you say look, I’m going to take my

money out of your account. So far this sounds great. What you didn’t even

tell people is some of what I saw in your investor [deck] which was about

how many people don’t have credit cards or can’t get credit cards. There’s

a reason why there’s so many check cash places all over country. Why didn’t

this work? If there was a clear need, clear research, a clear model, why

didn’t it work?

Wil: It worked great. It required tens of millions of dollars to make it

work even more great and that was kind of the tricky point towards scaling

is that you’re constantly buying inventory long before you get paid back.

The only way to kind of bootstrap it, if you will, is to charge exorbitant

rates. Is to charge $500 for a $250 Wii. Not because you want to but

because you have to because you’ve got to basically buy all of this

inventory ahead of time so you’re dealing with a cash flow issue.

Andrew: But you had top investors who put up their own money. I remember

talking to one investor who said he just pulled out his checkbook and just

wrote you a check. To him the initial payment wasn’t that much but it

started a relationship with you that I’m guessing he hoped would lead to

him being able to invest more. This sounds perfect, like a venture capital

backed company, and you had access to them. Why couldn’t you get it?

Wil: We talked to a lot of VCs. We ran into two primary issues with trying

to raise big amounts of money. One issue was that charging $500 for a $250

Wii, it’s usurious. It’s not really the business, when I conceived this

thing it wasn’t hey, let me try to figure out how to get $500 out of my

brother. It was let me create kind of a simple mechanism that he can pay

for stuff. But in order for it to work in the short term, again bootstrap

or small capital, you’d have to charge a ton of money. There’s no way

around it. We didn’t really have a choice and that felt usurious. That’s a

tough model to raise on.

Other people have done it. I don’t know if you know Doug Merrell at Zest

Cash, the former CIO from Google. He’s Los Angeles based. One of the

smartest guys I’ve ever met. Doug’s doing online payday advance. A very

difficult business and I think they just pulled down $75 million. It can be

done but it was really difficult for us to do it.

The other piece to it that was particularly challenging for us is as we

started to kind of get down this path where it felt like this kind of

usurious product, like that was kind of the only path we could get down. I

think we lost passion for it because that was not what we were trying to

create. It was kind of a necessary evil but not exactly where we wanted to

be. We kept trying to come up with ways to get around that but it’s really

hard to…

Andrew: For example?

Wil: Well, we tried to figure out what could we do to make sure, enforce

payment which sounds kind of draconian. But it was really just trying to

say OK, well if it was an auto-debit could we get paid. We did some test

runs with folks and it was really difficult to determine who was going to

pay you back and who wasn’t. Because we were dealing with folks that they

didn’t even know if they were going to get paid month over month. They had

very transient jobs so it was very hard to do the credit forecasting. We

tried all kinds of stuff. It was tricky but at the end of the day it

required big cash and it was difficult to raise big cash against the model.

Andrew: Why did you leave Southern California where there are all of these

people for you to exchange ideas with? Where you can talk to them about

business ideas that actually generate a revenue and see those entrepreneurs

who had experience in that space and enthusiasm for it. There’s a downside

that I can’t articulate. You’ve always been good at articulating these

ideas that I haven’t been able to express. What is that downside that I

can’t articulate here?

Wil: What’s the downside to Southern California?

Andrew: Yes.

Wil: Oh, boy. Definitely not the weather. No, Southern California was

awesome. At the end of the day a lot of our transition back to Columbus, we

already had a house here, had to do with my wife wanted a kind of a regular

Midwestern town to raise our kid. It really had nothing to do with the

environment there. I loved having all kinds of peers to be able to talk to.

You know, the Midwest is different. It’s just not internet territory but if

you’re raising a family it’s amazing.

Andrew: But you’re someone, wouldn’t you be someone who would push your

family to make sacrifices for business because you’re an entrepreneur and

because of the kind of entrepreneur you are.

Wil: You know, that’s a great question. Not this time. You know, like Sarah

and I have been together for ten years. She’s wonderful. This was one of

the times where, she’s backed me on everything. I walk into the room and

I’m like hey, I’ve got this great idea. She’s like oh, no, here we go

again. You know? Every time she gets behind me. She’s so supportive. This

was the one time, you know I hate to call it this but this was her start

up, being the family. Whatever she wanted to do, wherever she wanted to

take it I was going to be fully supportive with no questions asked. You

know, could I have like forced the hand? Maybe but I didn’t want to. Like I

said, I more than owed it to her and our daughter to go wherever we thought

it was best to raise a family.

Andrew: You and Sarah at one point, I think it was, man I’m trying to think

of what it was. We talked about it over brunch, I wasn’t really paying, I

mean I was paying attention but not taking notes. It was something like a

nightclub together, am I right?

Wil: Oh, God yeah. Let’s not talk about that.

Andrew: Here’s the thing, well, I’ve got to. First of all why’d you say oh,

God? Why not?

Wil: I was just talking about this last night. We were doing our launch

party for Fundable. Somehow it came up last night and Sarah was standing

next to me when it came up and she just shook her head and walked away.

She’s like what were you thinking?

Andrew: Why, what was the problem there?

Wil: We were, you know, we were launching SwapALease.com at the time so we

were already working insane hours. Then we just had this ridiculous idea

that since we were, you know, we loved throwing events and putting parties

together for our friends that, you know, how much easier would it be just

to have a nightclub and do it all there?

That’s a great idea for about five seconds until you realize that people

who run nightclubs work different hours. Like I work from 6 a.m. til about

9 p.m. People at the nightclubs work from 9 p.m. to 6 a.m. Which means if

you’re going to be in that business, you get to work two shifts. On Friday

morning I’d go to work at like 6:00, 7:00 in the morning then go downtown

to go work at this nightclub, which is totally ridiculous by the way, until

4:00 in the morning. I don’t know what you want to be doing at that point

but I want to be sleeping, right? It sounded like a great idea and it just

dragged us through the mud. It was a terrible idea.

Andrew: Especially if you’ve got a girlfriend. If you don’t have a

girlfriend you think all right, this is going to bring girls to me. I can

date more easily. But here’s the thing that I want to get at. You take

these risks both financially and, I don’t know how to express it, but you

could potentially lose a lot of face if you have this nightclub and nobody

shows up. Hell, I’ve had dinner parties where I say if no one shows up I’m

going to feel like a fool in front of the few people who do. Same thing for

house parties. Do you feel the risk that you’re taking when you take it or

are you someone who just doesn’t feel it and that’s why you can take so

many risks like that?

Wil: I feel it every single time.

Andrew: How do you get past that risk when you launch Afford It or Swap a

Lease, the company that lets people get out of their leases, or now

Fundable.com. How do you get past it?

Wil: You know what, I’ve kind of been down this road so many times of just

jump in and figure it out, case[??] we figure it out. We’re not always

successful but we motor through. You know, like pretty much we’ve jumped

out of enough planes and eventually figured out like how to make it to the

ground safely, right, so that we can get used to jumping out of planes. I

can’t think of a better way to say it because as an entrepreneur we’re all

afraid that there’s going to be this one colossal failure that ends our

career and we end up hermits in some remote location where people come find

us and find out what happened to us. That doesn’t actually come to pass.

You know, you make a mistake, you screw up. No one actually cares but you.

Your friends are like hey, did you hear? Something stupid happened with

Wil’s nightclub, it failed. People are like huh, who cares? It’s a topic

for like five seconds. If you can get past that it’s not hard to try a lot

of things.

Andrew: You’ve had people, we’ve seen them in Southern California, really

brilliant guys who are great at bringing in revenue but there are also

people who just try everything and they’re never going anywhere. Or they

try one thing and you know when you talk to them they’re never going

anywhere. Again, you’re very insightful. Why do you think they’re never

going somewhere even though they keep trying? Even though they’re willing

to take those risks?

Wil: You know what? Let’s face it, none of us knows while we’re doing it

that it’s not going somewhere. Right? Like when you’re right in the middle

of it it’s like being in a relationship that you have a crappy spouse and

everyone else knows it but you. In your mind if you could just fix that one

thing about him or her everything else will work out. I think the problem

is the person in that situation doesn’t have the perspective to be able to

say this is a lousy relationship. This is going wrong. In their mind they

can just do right thing to make everything right. They’re one step away

from a Facebook.

Andrew: Yes.

Wil: It’s not whether they can or can’t be successful. It’s that they’re

not aware that they’re not successful.

Andrew: I see. It’s the lack of willingness or the inability to see the

situation as it really is. Sometimes you have to close a company to really

see that. I had to close down the first version of Mixergy to realize what

mistakes I had and then I had to take a few months, maybe even a year, to

figure out why.

Wil: Yeah, and the thing is sometimes we’re fortunate enough that it gets

done for us. When I was giving you the PowerHouse.com example my partner,

who’s a brilliant guy, came to me and said hey man, you’ve got to make a

decision. It’s me or her kind of a thing. That forced me to realize that I

was that guy. I was right in the middle of making, I was in a bad

relationship with this idea behind PowerHouse.com and everyone else saw it

but me. Whether he intended to or not he forced a decision that put me back

on the right path.

Andrew: Did you realize right away that he was right or at the time did you

say I need to do this to bring peace to this house, to this family and so

I’ll do it. And then maybe months later you said you know what, I was being

too stubborn. Of course, it made sense, this was the right move and came to

an understanding of why it was the right move. When did it happen? Right

away or months later?

Wil: It just happened to be right away and only because I respected him so

much and I knew that he wouldn’t have brought that up unless it was a

really serious issue. It’s like when somebody just grabs you and says what

are you doing? That was just one of those moments where I was like you know

what am I doing? If anything I’m readily willing to admit when I’m wrong,

because I usually am. If somebody puts something to me my ego isn’t so

crazy where I’m like oh, that could never be the case. If somebody says

hey, you’re doing it wrong. If you sat down with me and said hey, I think

Fundable is a terrible idea I wouldn’t just write that off. I’d say hey,

well let’s talk about why you think it’s a terrible idea and by the way,

you might be right.

Andrew: I think Fundable is a great idea and I’ll tell you and the audience

why in a moment. And then I want to talk about someone in my audience. This

may be the most important part of the whole interview, what I’m about to

say right now. And then I’m going to ask you a question that seriously if

someone didn’t find any value in everything up until now and was

complaining about the audio and the guy who was chopping behind or whatever

noise was coming on, this one question that I have in mind I want it to be

the most useful thing and make the whole thing worthwhile.

But first let me show the audience how an ambitious entrepreneur solves a

problem. In the comments of one of my recent blog posts, the post about

systemizing, Antonio, the founder of A Tailored Suit, said he found himself

working 90 hours a week in his business and his business was in chaos. I

want you guys to see how he solved this problem so that you can solve

similar problems for yourself. In his case he said he sat himself down and

he learned from five Mixergy interviews on systems and he implemented what

he learned.

Now you can say I hate Mixergy, I hate Andrew. I’m only here because I’m a

buddy of Wil’s. You don’t have to get it from Mixergy. You can go to the

library, you can go online, you can look it up. But the idea is he realized

that this was a problem where when I thought I was working 90 hours I was

superman. I thought I was conquering the world. I didn’t realize I was

working 90 hours a week because the business was in chaos. He realized

there was a problem and he went out there and he looked for solutions. I’m

proud that he came to MixergyPremium.com specifically to get those

solutions.

Not only did he get those solutions he says Andrew, I can’t wait to improve

upon this. I have so much more to systemize. Haven’t you guys in the

audience found this yourselves? When you conquer something just a little

bit you want to go out there and do even and even more and even more?

That’s what we want you to do with Mixergy Premium. Now this kind of value,

you see he’s saying that he, well you’ll see in a moment what happened to

his business. In your business I believe if you systemize it could be worth

thousands of dollars to you. I know it was to me because once I systemized

I was able to pass on my work to other people. Now there are more people

working on Mixergy than I can count. No, not quite. We’re just under a

dozen people who all help out. But I was only able to do it because I

systemized what I did and then I passed it on to one person. Then when

things didn’t work right we improved the system and so on.

It was worth thousands to me. It could be worth thousands to you, but

Mixergy Premium is costing way, way less than that. If you go to

MixergyPremium.com, you’re going to see how much less. If you’re not happy,

in fact, forget happiness. I don’t want you make you happy. What I want you

to see is that each dollar that you spend on me is going to bring back at

least four, maybe even ten, maybe even thousands of dollars back to you. If

you don’t believe that’s true then come back and I’ll give you 100% of your

money back.

Here’s what Antonio says, again in the comments that you can see on the

blog post. He said publicly for anyone considering Mixergy Premium you are

crazy not to jump on this information for the price. You’re crazy not to go

in there. Andrew is way undercharging for the value received. It’s true, at

some point I’m going to increase the prices but if you lock your price now

you’re going to get it forever. Go to MixergyPremium.com. Let me articulate

it because I watched myself yesterday and I realized I’m not articulating

it well. MixergyPremium.com. Go there, sign up, and you’re going to see the

sooner you sign up the sooner you’re going to get results.

Hey Wil, before I ask you this important question that I wrote down here.

As someone who loves sales, as someone who can be honest with me because

you’re a friend, was I pushing too hard there? What do you think of this

sale? I’m trying to learn how to improve my pitch in these interviews. How

was that? Be honest, brutally honest even.

Wil: I don’t see people often enough just stand up and say buy my product

because it’s good and if it’s not I’ll give you your money back. I like the

fact that you say I’m not trying to make you happy. I’m trying to offer you

value for value and I’ll stand behind the product. I don’t, again I don’t

see people doing that often enough. I think we’ve gotten into this world

where everybody’s got to be so subtle and be afraid of just saying yes, I

want this sale. You know what? Saying yes, I want this sale is real. I

think that, you know, it makes you an entrepreneur. There’s nothing I’d

change about it.

Andrew: What about the pacing? Was I going too fast, too slow, too long?

Wil: No, I think it was good.

Andrew: All right. I am now achieving perfection.

Wil: Yes.

Andrew: I’m working on it. I sucked really badly in this one interview

where I was promoting Mixergy Premium and I said how can anyone ever take

me seriously if I flub the way I describe my own product? I sat myself down

and I worked on it. I worked on what I was going to say and I think I’m

getting better. I’m going to keep working on it even further.

Here’s the big question. The big question that I asked you before we even

started this interview. Which is how does a founder who has a lot of ideas

actually launch them and stay focused on the right ones? If you could give

someone advice, someone who’s in the audience right now who says I wake up

every day, I have these great ideas. Before lunch I have 20 ideas. How do

they launch them and how do they stay focused?

Wil: I am the absolute worst person to ask that because no one has stayed

less focused than I have. What I can tell you is my regrets aren’t that I

didn’t start more companies. My regrets are that I didn’t stay focused on

the companies that I did start. That I didn’t spend more time with my kids,

so to speak. You know, where I didn’t watch them grow up. I’m proud of what

we’ve accomplished with the companies but I realize looking back that in

order to create a great, sustainable company it requires a lot of time. It

probably requires an average seven to ten years. This idea that I’d spend a

year and a half on a company and it would just magically not do me a thing,

I’m realizing now that’s just not terribly realistic.

Any of them that did do well was probably sheer luck, not because that was

the right approach. You know, for something like Fundable I realize now

man, I need seven to ten years to get this right. This isn’t like a hey, in

a year it will become Pinterest. It’s not going to happen. I think a better

way to look at it is not how can I launch companies and make them

successful. It’s how can I realize going into it the first three years are

going to suck. It’s going to seem like this is a terrible idea and I’m on

the wrong path. It’s going to take at least year four for me to realize if

this thing has any scale worth doing. Have you interviewed Jason Nazar from

Docstoc?

Andrew: No, not yet.

Wil: Man, Jason and I were just talking about this a few months ago. You

know, they’re doing great at Docstoc. Jason’s been at it a long time. I

think right around that year four is when things started to arc for him.

Four years is a long time in our business. In any other business people

don’t think twice about it. But in our business that seems like an

eternity. But if you look at Facebook, Google, to some degree Zynga, they

all have roughly the same gestation period. It takes a long time. These are

the fastest growing companies. These aren’t companies like 37 Singles or

Mail Chimp. Those guys will tell you those are even longer cycles, you

know, in order to kind of hit that curve.

I think as founders we have to realize that when we make a commitment, when

we get wed to an idea, it’s a long term commitment and it’s going to take a

long time to find out whether you’re on the right path. The idea of just

chopping ideas quickly, like I was doing, you can do it and if you put in

enough hours, maybe make up for some of it, but man, I can’t tell you how

much I’m looking forward to staying focused on one thing. Which I’m going

to eat my words, a year and a half from now I’m going to be telling you

about a new idea I have for some rocket car or something like that. So I

reserve the right to take this back, but right now I’m just so focused on

trying to get one thing done.

Andrew: You know, coming from you that means a lot, because you have the

credibility to say that. If it was someone who was like me, who was

insanely focused on one thing, basically his whole life, I think well, you

know, maybe you’re just afraid to take risks. Maybe you just don’t have the

other ideas. But I’m looking at you, you’re not afraid to take risks. You

do have constant ideas. You have gone the other direction. You’re making a

conscience decision to focus and so this message means a lot. Now you may

change things in the future, but I don’t want you to feel like you can’t

talk because it might lock you into something.

Wil: Yeah, no that’s what I’m saying. I’m telling you how I feel today. It

could always change in the future.

Andrew: That’s the thing about these interviews, that the more I go and the

longer I’ve done them…Actually you know what, no, what I’ve found is

really, the essence of the person always stays the same.

Wil: Yeah. Yeah, cool.

Andrew: And we’ll be happy to have you back on. Here’s the big takeaway

from fundable.com. Here’s what I’m understanding. If I, not today, but it’s

coming soon because the law just changed, you guys are jumping in there

before it all goes into effect, but if I’m an entrepreneur who wants to

raise money for my company, not by going from entrepreneur to entrepreneur,

investor to investor, trying to raise angel funding, and then going, series

A etc., the way that you have. If I want to instead put my stuff out there

and say, ‘Anyone love this thing enough to want to invest in it? Anyone

care enough about this thing to want to take a piece of this and I will

fight for you like mad if you do and you’ll guide me because you’re…’ Now

also my fans, if this is what you want, this is the site to go to. Go to

fundable.com. Do I have the right understanding of where you’re seeing this

business go?

Wil: Absolutely. You nailed it.

Andrew: OK. All right. And until then, what do they do if they have a

business? Do they just go to fundable.com as their place to register and

say hey, as soon as this new law comes out, I want in?

Wil: Yeah. Yeah. You can apply to be a start up on the system right now.

Andrew: There it is. On the bottom right, the number 6 box I see on

fundable.com is apply for a fundraiser.

Wil: Yup. And we’ll walk you through the process and we’ll be able to do an

early version of equity fundraising as early as July 4th. So it’s only

about [??] weeks away.

Andrew: Oh, wow.

Wil: By the time we get your profile set up, your video ready, and

everything else like that, it’ll be almost time to start that portion of

the race.

Andrew: Ah, I see. So you want people in there as soon as possible so that

they can jump in there if they want to.

Wil: Yup.

Andrew: All right. I just, the reason that the connection slowed for the

audience for a bit is because I was clicking through to see how easy it is

to apply. Its right there, you’ll figure it out. I don’t even have to

explain to you. All right, fundable.com. Wil Schroter, thanks for coming

back and doing a second interview with me. I look forward to many more in

the future now that you’re focused on one business.

Wil: All right, my friend.

Andrew: All right, either way. Bye, talk to you soon.

Wil: See ya.

Andrew: Bye everyone.

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  • http://www.ipyxel.com/ Tom Fang

    I suffer from this idea ADD all the time.  I often question if the thing I’m doing now is going to be able to attain the goal and vision that I have set in my mind.  I am constantly seeking validation for motivation to keep going.  I often think I should go for one of my “bigger” ideas as the current one I’m working on has a limited market but I feel a more sure of a bet.  I think I feel this all the time as time itself feels SO SCARCE.  Years of work could mean a lot of nothing. And you only get a couple “years of work”.

    PS, I have the same Blue Yeti microphone as Wil!!  Gosh visionaries think alike I guess.

  • http://www.itcertificationmaster.com/ Mirek Burnejko

    Interview: Wow. What a guy. I love how he mix all these ideas: lean startup, bootstrapping, raising money, addiction to startups. I would love to see a master class with Wil about lean startup. He has so much ideas in his head.

    Technical: I love new resolution (probably two/three last interviews). Two small minuses: echo :) and “why-Wil-isn’t-in-the-center-of-his-camera?”

  • http://www.facebook.com/wilschroter Wil Schroter

     Mirek sorry for the crappy audio.  That conference room has vaulted ceilings so it does a horrible job of managing sound.  We need a better system.  My apologies.

  • Retina

    Finally a interview with scenery. Great program as usual.

  • http://twitter.com/RandyCantrell Randy Cantrell

    Thanks, Wil. And Andrew. You both infuse me with renewed energy. And make me wonder what my generation might have accomplished had we been so open.

  • Antonio Centeno

    Great interview – I about spit out my coffee when Andrew mentioned one of my past comments.  Thanks for the acknowledgement Andrew and I meant it – Mixergy premium is the best!

    Highly advise Wil’s older interview – I rate it as one of my favorites as he really goes into detail on pay-walls and when to charge people/how to test the pricing so you don’t leave money on the table.

  • Anonymous

    Great interview, very inspiring. I went to high school in Columbus, OH so it’s fun to hear from someone in my hometown and outside of SV/NY. 

  • Carter Johnson

    Great interview! Every minute I spend on Mixergy leaves me more motivated, more focused, and more eager to learn more for my business. 

    Quick question… As a resident of Cincinnati Oh, I can strongly relate to Wil’s statement about how theres not too many people to talk startups/business/software with in the MidWest. Any recommendation how to find and connect with likeminded individuals? I love the energy I come away with after being on Mixergy and wish I could find more people to talk ideas and projects with on occasion!

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