Before we get started I have to tell you about my three sponsors. The first is Wu Foo. You get forms and surveys that you can embed into your website and they look so beautiful that I use them on my wedding site and they’re so functional that I have them on my contacts site, on Mixergy dot com. Check out Wu Foo dot com. Second is Shopify dot com where you go to get a new online store that you can manage easily online and sell directly to your customers and take orders and credit cards and all that. Shopify dot com. Let me be clear about that: Shopify dot com. Finally there’s Grasshopper dot com, the phone system that I use and entrepreneurs love because it has all the features of the big robust systems but you can manage it online and you can use your current phone system with it. I use my current iPhone and I use the landline here in the office with Grasshopper. Not that I like the landline but I’ve got it so why not? Grasshopper dot com and here’s the interview.
Hey everyone, it’s Andrew Warner founder of Mixergy dot com, home of the ambitious upstart and you guys know what we do here, right? We interview top internet entrepreneurs about how they built their business. And lately I’ve been getting a little bit of criticism from the audience. They’re saying, “Andrew, stop interviewing guys who raise buckets of money. Millions of dollars and then they go on to create even more buckets of money and even more millions of dollars.” They say they want to hear from people who are a little scrappier, who are more bootstrappy, who can come up with an idea and find a way to execute it because that’s the way you really understand how to build a business. Even the guys who raise a lot of money can learn from these scrappy bootstrappers. Well, today I’ve got that kind of person. I’ve got a guy who is one of the scrappiest, uses his knowledge not using outside funding to build his business. His name is Anand Shimpi and he is the founder of Anand Tech. And, Anand, tell me if I’m getting this right? Here’s my understanding. Your website is the largest website for…largest independent website for tech news that caters to the top 10% of the tech audience. True?
Interviewee: Yes. I would say we do more reviews and analysis rather than news. Right? The majority of our content is…you know, I write things that are 20, 30, 40 pages long. So definitely not your short like kind of news place.
Andrew: So my mother, if she’s trying to figure out whether the iPad or the iPod is for her, isn’t going to your website. Who’s the typical person who’s going to your site?
Interviewee: So with a readership as large as we do, we’re talking multiple millions of people every month, it really varies. You have people that are like me who are just super passionate about the technology. So they just come to learn because, hey, it’s kind of cool. It’s just like people reading about cars. And then you have people that actually need this information for either for their job if they’re a financial analyst, if they’re following these companies, if they work in the industry. I mean, basically if you want to know anything about the technology that goes in everything from your Smart Phone to your PC to your Mac, we cover it. Down at the chip level as well as the product level.
Andrew: Okay. And guys, hang on because throughout this interview we’re going to talk about how he built up this company, At 14 years old he started and he built it up. We’re also going to…he and I talked before the interview and we agreed to give, not all his financial information but we agreed to reveal one of the big numbers so that you get a real sense of how this business is doing. I’m not just talking about a guy with a website that happened to start at 14; but a guy that built a really successful website that his audience loves and also, as you’ll see later when we get into the financials, that’s doing well financially. So he doesn’t have a job on the side, is what I’m saying. Far from it, as you’ll see. Okay, so let’s talk about…what were you like at 14 before you launched this? I want to get an understanding of the person who built the business.
Interviewee: Okay, so I guess in order to understand what I was like at 14 you’d have to understand what I was like at 12. So prior to that I’m the only child of two teachers basically. Both my parents are math majors and thus there was like a lot of logic in the family. My dad was a computer science professor so we basically, from a young age, I always had access to computer hardware. And I always had a knack for taking things apart. I think that came from my mom’s side. But I basically used to take apart like watches and clocks and stuff like that. Eventually the older I got it graduated to computers. And that’s kind of a dangerous thing to do when you’re a kid because oftentimes it results in a lot of broken computers. And I think I ended up in like deleting or losing my dad’s PhD dissertation at one point. So at that point he was like, “We got to get you your own computer.” But back then, getting your own computer…this is like 1994 or 5 or 6, it’s like $3500 for a decent PC. So that wasn’t really in the cards. Again, my parents are both teachers so that wasn’t really happening. And I used to read these thick magazines – it was called Computer Shopper back then. And I just used to flip through it and just kind of like pick out all the components I’d like to have in my machine. I didn’t really know anything about them but I was super excited about it. There was a lot of passion in it.
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Interviewee: So, yeah, we bought the whole computer, piece by piece, and we put it together. And I made a rookie mistake, like if you’ve ever built a PC before, if anybody in the audience ever has. I put too many stand-offs in the case, and I ended up shorting the mother board, and that was the last straw. My dad was like, I’m sorry. You blew it up. You’re not getting another mother board. My mom was actually the one that came forward and said, “No, look, I’ll pay it. It was, like, $120. You’ll get a new board. We’ll get it working.” So, we did that and, you know, I built my first PC. It wasn’t anything great, but yeah, you know, it worked. And it was something for me to tinker with. Now, given that my dad was a teacher, students and other faculty also kind of needed computers for cheap, and they needed computer help. So, when I was 12 after school, like I was in the eighth grade, my dad would pick me up from school, and I’d basically be a one man geek squad. I would show up at, like, students’ houses or other faculties’ houses. I either build them computers, or if they had problems with them, I’d try and fix them. I don’t know. I guess it was the result of my parents both being teachers, both being people that were really, really stressed that you should always want to help people with what you do in your life. I was supposed to be a doctor, so that’s where that was going to go, but I always had this kind of desire to teach and help and I guess I just kind of did it through computers. So, I basically did that for two years before I started the website.
Andrew: OK. Let’s stop there and just compare you to a mutual friend, Rahul Sood, who is the founder of VooDoo PC and who I know you know, too, right?
Interviewee: Yeah.
Andrew: He had a similar history where he also took–I think he took apart the first computer he ever got, or he rebuilt it or something similar to you. The direction that he went in was find ways to monetize it. You decided to go towards teaching, and you told us a little bit why because of your family. But was there also an entrepreneurial bent to your interest? Were you also thinking how can I make money off of all this knowledge?
Interviewee: Absolutely not. Like, I would say that–I don’t know. If I had more of that, I probably would have been retired by the time I graduated high school simply because that’s when the Dotcom boom was happening, right? But I definitely didn’t have that in me. It was nice. I believe my rates back when I was in eighth grade, they were like 50 bucks an hour or so. So, it was great for pocket money, but my parents always stressed education first so I didn’t think this was a job. It was just something that I did and something that was fun. Then, when I started the site, honestly, the reason I started it was I just thought it would be cool to have an audience. I thought it would be cool to have people that when I woke up in the morning and I wrote something that they wanted to hear. I just thought that was neat. You know, it was April ’97. It was, I believe, spring break my freshman year in high school, and I was in the shower and I was just like, “Hey, this would be kind of cool if I did this”. So, I set up a little website on GeoCities and my first post ever was, “I don’t really have anything to say and nothing to review, but there’s going to be more in the future.”
Andrew: OK, so let’s stop there. First of all, GeoCities is the start of this great, great tech site. That’s interesting.
Interviewee: Yeah.
Andrew: But also, you said, “I don’t have anything to teach”. You didn’t do what a lot of other people did on GeoCities or when they first built the website which is to just try out different technology, to just put a bunch of bouncing, smiley faces the way they did on GeoCities. You, from the start, were saying, “I’m going to teach. I just don’t have anything to teach yet.” That’s the passion that you had even back then.
Interviewee: Absolutely. I mean, I just like–I don’t know if you ever read Malcolm Gladwell. There’s like this idea that you have these people that just want to share information and spread knowledge. For whatever reason, that was me.
Andrew: Because of Mavens, right?
Interviewee: Yeah.
Andrew: OK.
Interviewee: So, you know, even prior to this, I remember when I was even younger I used to write little video games strategy guides and stuff like that. I always just like to share information
Andrew: All right. I know that you have a lot of fans, and it looks like you’ve got some fans here in the audience, in the live audience, including Jordin Sparks who can’t believe that at one point even you were a newbie. Let’s see, and I can’t pronounce this person’s name but he’s saying, “Yeah, when you love your job, why retire?” And you’re at a point right now where you could retire. You don’t have to continue teaching, absolutely right?
Interviewee: Oh, absolutely. This is something we can dive into greater detail if you’d like. My whole philosophy here is that I was fortunate to find something and have the opportunity to do something at a very young age that I was truly passionate about. And then I was extra fortunate for that to turn into something that ended up being my career. I was actually just speaking at a school last week about this and that middle school and high school, for me, were very, very influential times. They gave me the opportunity to basically have a free ride. I got to spend the majority of my days doing whatever I wanted to do. And I channeled that into something that ended up being my career to the point where I don’t have to work a normal job.
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Interviewee: …where I don’t have to work a normal job, I get to do something I’m truly passionate about, and it’s a lot of fun, right, like I, I don’t know, I like working too much to ever just completely back away and retire, I mean, I can see myself not putting in as many hours, but…it’s…this is fun work, this is stuff I love to do. I’ve been doing it for thirteen years, right, like I always tell people – if you start…if I’d started doing what I was doing for money…I mean I didn’t make money for the first two years, right? If…if I started doing it for money I would have quit after four or five. There’s no way you can stand it. Like it’s…it’s…it’s a lot of work, it’s tough.
Andrew: Alright, so then, fourteen, you start off with Geocities, when do you finally move over? How old were you when you moved over to your own domain?
Interviewee: Let me see, so Geocities kicked me off after a few months because I had an advertiser, so the whole deal there was you could have a free website but you can’t have advertisers. And I didn’t have an advertiser that was paying money, the thing was I needed hardware. So the first company that came to me that wanted to advertise I was like, look I don’t want your money, just give me components…give me stuff to review. So I had a banner ad, so after a few months Geocities pushed me off. But I didn’t have my own domain, I was like a subdomain of…of a hosting company called Pear. And I think…I would say probably within the first year or so was when I moved to my own domain.
Andrew: And it was the current domain that you have now – you’ve owned it since then?
Interviewee: Yes, absolutely.
Andrew: OK. Alright, let’s get a little geeky and talk about the technology that you use to…to publish your first site.
Interviewee: Oh Jeez, so this was like my first computer…the thing I built, right? So this was like a…a AMD 46DX4120 and…
Andrew: I love how you still remember that by the way!
Interviewee: Oh yeah man! This was like, this was the thing that I built it off of, so I had that and you know I had like a…a…the thing I was testing hardware, I was testing PC components, but I still only had one computer, so that became like my evolving testbed. So I had like a…a Syrex 6X86PR150 in there, and I had a…a…like a bunch of the old EX’s..it’s basically any new component I got went into my machine..I tested it and I published that review using that hardware. And that’s actually a philosophy that I kind of carried on to the site today and you know….things have gone a lot more complicated up in going work like space and storage space and one of the things I do and one of things that I stress is if I review something and I actually recommend that everyone go out and buy it…I have to use it in my own machine to make sure there are no weird promises that I don’t regret recommending it.
Andrew: It must drive you nuts the way most people do reviews today which is they get the review copy right away…they try it out not necessarily in their home environment or the way that they ordinarily use their device but they test it in their office and then they go and publish their first review out there so that they can get on their track. What do you think of that?
Interviewee: Well, this actually…I believe that there is a need for both…right…I view media, technology and I guess the press..is that you have two ways of really building a publication of this sort ..you either have entertainment through education which is the round I take or education through entertainment..and it’s a key difference..but if you take the education through entertainment ground your number one goal is to kind of make people come to the site and kind of get excited and get happy and it’s like watching a TV show or watching a movie..which works and it’s a great way and that’s what I believe the world media in US is today…right.. You know we have these 24 hour news channels..that’s what they do…they are not designed to educate first they are designed to entertain you first and they entertain you through..you know..whatever tricks they follow. And I think there is a need for that…right…the need to easily digestable news sources and review sources at the same time you need publications that are kind of educational first and that’s what I believe that we do and that’s what I believe my philosophy has been from the start and these are actually some of the things that Taterry talked about after he kind of left the industry..right..He talked about this idea that..you know… the focus is on gaining leadership gaining scopes so you can be more attractive to advertisers and not necessarily on the content and again I believe that there is a need for both. If everything in the world was public access..news and radios and honestly you won’t have lots of information spread to the people who can use it. But if it is a good balance of the two then I believe that’s a healthy system delievered. I believe we have more of that on the internet than we do in the cable TV round but I have seen over the past several years…kind of a trek transition towards the more entertainment aspect rather than education first.
Andrew: So let’s go back then, fourteen old you were writing these reviews online and who’s listening to a fourteen year old’s opinion of serious technology moving under a tendo or tarry system?
Interviewee: So the way I started …
Interviewee: …where I don’t have to work a normal job, I get to do something I’m truly passionate about, and it’s a lot of fun, right, like I, I don’t know, I work like working too much to ever just completely back away and retire, I mean, I can see myself not putting in as many hours, but…it’s…this is fun work, this is stuff I love to do. I’ve been doing it for thirteen years, right, like I always tell people – if you start…if I’d started doing what I was doing for money…I mean I didn’t make money for the first few years, right? If…if I started doing it for money I would have quit after Horror 5. There’s no way you can stand it. Like it’s…it’s…it’s a lot of work, it’s tough.
Andrew: Alright, so then, fourteen, you start off with Geocities, when do you finally move over? How old were you when you moved over to your own domain?
Interviewee: Let me see, so Geocities kicked me off after a few months because I had an advertiser, so the whole deal there was you could have a free website but you can’t have advertisers. And I didn’t have an advertiser that was paying money, the thing was I needed hardware. So the first company that came to me that wanted to advertise I was like, look I don’t want your money, just give me components…give me stuff to review. So I had a banner ad, so after a few months Geocities pushed me off. But I didn’t have my own domain, I was like a subdomain of…of a hosting company called Pear. And I think…I would say probably within the first year or so was when I moved to my own domain.
Andrew: And it was the current domain that you have now – you’ve owned it since then?
Interviewee: Yes, absolutely.
Andrew: OK. Alright, let’s get a little geeky and talk about the technology that you use to…to publish your first site.
Interviewee: Oh Jeez, so this was like my first computer…the thing I built, right? So this was like a…a AMD 46DX4120 and…
Andrew: I love how you still remember that by the way!
Interviewee: Oh yeah man! This was like, this was the thing that I built it off of, so I had that and you know I had like a…a…the thing I was testing hardware, I was testing PC components, but I still only had one computer, so that became like my evolving testbed. So I had like a…a Syrex 6X86PR150 in there, and I had a…a…like a bunch of the old
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Interviewee: the way I started, the way I actually promoted the site was, I was kind of active in news groups back then, these were like you know, an archaic part of the internet, where, basically they’re a precursor to discussion boards. So I had a bunch of people waiting for me to actually write, you know I said A-beam[sp] is coming out with this new chip, the K6 and I was going to write an upgrade guide from like a Cyrex[sp] system I had all the way up to this K6. Now I remember the day the processor launched, I picked up the phone, called and tried to order one, and they were supposed to be, I think like three or four hundred dollars at most, but it ended up being, I mean the supply was limited and the chip was like seven or eight hundred bucks. I couldn’t afford it and I was like, “crap, I have to go to all these guys,” I even had like an excel sheet of everyone’s email address that wanted to hear my review, and there were like maybe fifty people on that list. And I was like, “crap, I have to go back to these guys and say, ‘well look, I can’t afford the chip, I’m going to let you all down.’” So instead of doing that, I set up the website and I sent it to these like fifty guys and I was like, “look, I don’t have the chip but this is where I’m going to start doing all my, my computer stuff from now on.” And I think by the end of the first week I had maybe thirty visitors. Like it was just, you know, I used to watch little geocities tracker every day, and you know, it ended up averaging like twenty or thirty people a day. But it grew, right? The more, I mean, the fundamental of internet publishing are if you publish good content, people come. So that thirty people a day grew to a hundred, and then you know, every now and then you’d have a two hundred person and then that would become your average. And then you’d have a thousand person day and then that would become your average. And I remember I had like a big contest when we hit like a million visit
ors on the site. And it just grew from there. So it was all word of mouth on that aspect. The other side of the story, though, is, look, I was fourteen and fifteen when this was happening and if you remember back to ninety seven, if you were a kid online, with any sort of like a, anything, business or not, that was a big deal. So actually my dad was in a line, like a checkout line at KFC one day and there was a reporter there from a local newspaper, “The Triangle Business Journal,” and she was talking about kids making money online. And my dad was like, “hey, you should check out my son.” So she actually came to the house, did this interview, did this write up and then, after that, it spread like wild fire. Then the local newspapers came, the “Associated Press,” picked up the story, then we had “USA Today,” come through. I mean, then all the T.V. crews started coming in, and the next thing I know, when I graduated in 2000, “Forty Eight Hours,” actually followed me through graduation. Right? Like I walked across the stage, got my diploma with a camera crew. And that definitely helped, right? It definitely helped.
Andrew: Were you courting them beyond your father saying, “hey my son is this great guy who’s running a website?” Was there any more courting going on?
Interviewee: No, no, see that’s the one thing, and you know people often, they, any time anyone’s successful, right, the number one thing people ask you is, “well how do I do it, right? What do you do?” And, my philosophy is a little bit different, right? I never went out and networked, I never went out and kind of did the traditional things. My approach, my philosophy has always been, you become good enough at whatever it is you want to do, and the right people will come to you, they’ll find you. And perhaps that’s a longer, more painful journey, but that’s the journey I took. Right? I rarely had to court anyone whether it was manufacturers, whether it was, you know, whoever, I just made sure that I got better and better at what I did, to the point where, you know, we’ve got Intel knocking at your door saying, “please, we want to work with you.” And, I don’t know, that’s, I think, to me that’s a different philosophy than what’s usually encouraged, but it puts the emphasis and the importance of success on the person, on the individual, on you doing a better job, rather than, you know, it’s not what you know, it’s who you know. And I agree, to a certain extent that that’s true, but I’m unwilling to accept that that’s the only option.
Andrew: I agree. You know what? I do come into these interviews, or I did, with this idea that it takes promotion, it takes sales, it takes marketing and it takes a great product. What I found as I’ve done interviews now with hundreds of entrepreneurs is it doesn’t take any group of things, everybody seems different and you go almost the opposite of the direction that I started off when, almost the opposite of the direction that I took in business. I was just about marketing, my kid brother and I would just, whatever we can create let’s get out there and market it, and, and then we’ll figure out how to improve it later. For you it was “let’s keep focusing on the product.” Do you ever feel that you could have done better if you were more of a marketer or if you had a marketing co-founder with you who would just go out there and do nothing but hustle?
Interviewee: I, it depends on your definition of better. Right? I did what I did the way I did it because it made me happy. Right? Because at the end of the day what I want to be remembered for is the way
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Interviewee: At the end of the day, what I want to be remembered for is, the way I did things. I did them my way. You know, obviously, coming up in ’97, ’98, and going into ’99, I mean, I had people telling me, “Look, you should go public.” And I mean, that’s insane, right? Like I hadn’t even graduated high school. I didn’t even know what “going public” meant. But back then, during the DotComBoom, and I like met with investors. I met with VCs. I met with people saying, “Look, you know, what you do is great. We’re going to bring in a management team. We’ll put in a nice CEEO, and all of this.” And, I don’t know. It just never felt right to me. It didn’t make me feel good, and it wasn’t what I was excited about.
Andrew: What about…
Interviewee: Right? So one thing…
Andrew: Uh-hmm.
Interviewee: I’m sorry. Go ahead.
Andrew: No, you please.
Interviewee: Well, one thing that, you know, when I first started doing this, I remember when I actually got my first paying advertiser, right? It was like 50 bucks a month. And I was like, “Oh, 50 bucks a month is enough for me to get my own kind of shared web hosting. And so, that’s fine. It covers that. I can keep doing what I’m doing.” And I sold ads, right? Like I was an ad sales guy, for like the first two years of the site. But I wasn’t passionate about that, right? That wasn’t something I enjoyed doing. Which is why, as soon as I had the opportunity to, I got a third party involved. And they handled all the ad sales. And I can proudly say, we don’t have a single salesperson on staff in my company. We’re all editors. We’re all people that write. And you know, there’s side benefits to that, right? The separation between church and state in terms of sales and editorials is important. And most of the competition doesn’t do that, right? You have people that treat this as a business. But that’s not what this was to me. This is something that’s fun, and I feel like I’ve been very, very fortunate to, I guess, have the opportunity to do this, right? And I don’t ever want to do anything to screw that up.
Andrew: All right. We have two different points of view here in the live chat room. Andy Dang is saying that it was easy for you not to have courted anyone, because there wasn’t much competition when you started. But GGLDM is saying, not really. Competition exploded pretty fast. There were dozens of sites by ’98. Let me ask you. What did you feel about the competition, about the landscape, when you were, when you were getting going?
Interviewee: So when I started, obviously the biggest name, and for those that followed me, was Tom’s Hardware. And that’s actually, you know, that was the site I read for like a year before I started. And hey, this guy was way bigger than me, had access to way more stuff, and was smarter, right? Like at 14, I mean I was an idiot when it came to this kind of technology. I really didn’t know what I was doing. So yeah, I mean there was, for people to kind of notice me, there’s no reason for them to. But what I looked at was, and I kind of call this, “the theory of controllable knobs”, right? I didn’t have the experience, I didn’t have the age, I definitely didn’t have the knowledge of my competition. But, what I did was, I used, I kind of tuned the knobs and tweaked the knobs that I could. I was in high school. I made sure that every day at 2:30, I was done with as much of my homework as possible, so that when I got home, I had the rest of the night to kind of work on what I wanted to work on. And that’s something that, you know, that your competition can’t really do, right? Unless you’re competing with a bunch of high school kids, which often times you’re not, you got to take that into account, right? Like people have, the older you get, the harder life becomes, the more responsibilities you have. You have to worry about bills and revenue and stuff like that. When you’re in high school, especially if you’re in a situation where, you know, you have a good family structure and a good home life, you have no responsibilities. And that gives you an advantage. You can make up for a lack of knowledge by doing that. And that’s what I did, right? I made sure I worked harder than anyone else. And the other thing that you and I talked about in the pre-interview is, I came up with this, and it’s not really a philosophy, it’s just who I am as a person. But it’s this idea that, just don’t be a dick to people. And that actually helped tremendously, because t
he thing about writing online is, inevitably, the people that the publishing industry attracts are people that have big egos, right? Who are we to say that we are so important that these people should come and read what we write? I mean, that is just an egotistical thing, right? And it’s a human nature thing, it’s a very important thing to do as a person, to kind of keep those kind of feelings in check. And what happens a lot of the times is, a lot of the people that write, or a lot of the people that are in the news or the media, they just start being a dick to people. You know, like, and I wasn’t. I made sure…
Andrew: Why did they become dicks? At what point do you feel like you have to? Is it that at some point you have such a big audience that everyone’s trying to get your attention? Is it that you start to do so well that you start to think that everyone else is beneath you, what do you think it is?
Interviewee: I think it’s a combination of factors, right? So, the one thing, you know, obviously, yeah, you get really big, you get a lot of people, and you know, I’ll touch a bit on how PR and marketing works with respect to the media. But, you have these people. Well, actually, I’ll dive into that right now. So, one thing I tell people when I’m bringing them on, and I’m kind of training them to work with me and write with me, is I say, “look, the one thing that I’ll tell you that’s true…
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Interviewee: …is I say, “Look, the one thing that I’ll tell you that’s true is the PR folks and the marketing folks that you work with at all these companies they’re paid to be your friend. That’s their job. That’s what they’re salary is. They’re going to be super nice to you. They’re paid to be your friend. If you keep that in mind, you’ll be fine.” And most people don’t, right? It’s nice to have people around you that are interested in the same things you are and, unfortunately, that’s the fundamental mistake a lot of people make. Because then when you have to go and trash a product you’re hurting your friend’s feelings. And you do a lot of subconscious stuff. You choose a certain verb instead of another one or you choose a different adjective here and it builds up and it’s noticeable. So you have to keep that kind of fundamental philosophy in mind. Now, if you look at it and if you say that someone in my position deals with hundreds of companies, and these guys all have people that are paid to be my friend, and they all come up to me and they’re like, “I loved your review! You did a great job doing this! I’m not just saying this because I work for blah-blah-blah, it’s just you did a great job and we felt it was very fair,” you know, it gets to your head. And you look at the stats and you see a thousand people, hundred thousand people, a million people – yeah, you start to think that you have some power. Especially because you can actually incite fear in these companies. They’re worried about what you’re going to say. And that’s when a lot of people fall over the edge and start doing dicky things. Right? They start doing things that they shouldn’t be doing. So that’s one aspect. The other aspect is, and this is a philosophy that many use, is that if you want to get someone’s attention you have to use some sort of power, right? And the power you have as a writer is to go out there and be a jerk to them. And they’re going to
want to then, at least some of them, will want to then stop whatever it is you’re doing and get you to write nice things. And, I don’t know…I think a combination of that, a combination of the fact that this industry brings out the ego in people – which is a human trait. I’m not saying I’m devoid of that, it’s something that affects all people. People give you…they shower you with attention, shower you with positive feedback. It’s going to get to people’s heads. You just kind of keep it in check. And it’s easy to not do that. So that was actually a big deal for me early on, right? Part of it is I’m a very, for the most part, easy going kind of passive guy in most situations. I don’t get upset easily. The only times you’ll see me get upset, and if you’ve worked with me on a manufacturing side, the only times I get upset are when you’re asking me to do something that just isn’t right or I feel like you’re pushing the boundaries of where my morals are and where my dignity and integrity lies. And I’ve had serious arguments with people before over that. But the rest of the stuff, I mean, it’s just life’s too short to actually care about that. Right? And I’m a happy guy. I’m doing something I love to do and it’s fun to do it so who cares, right? But when I was 14 that was actually a competitive advantage because no one wants to work with a jerk, right? Like no one wants to work with people that are difficult to work with. So I made sure regardless and my philosophy – and this extends to the readership as well. I don’t care how rude or how nice you are to me, I’m always going to do my best to treat you the same. And the readership responds well to that, right? It’s dealing with commenters one on one. Like if you take the person that says the most negative stuff about you and you still try and treat them with respect that shows. Other people see that. This is all public.
Andrew: All right, first of all you have a bunch of fans and supporters and people who’ve known you for years in the audience. Including and especially I’m going to say Cora Molik who remember you back from the old days and has brought up some of the references that you’ve made here, I’m appreciative of him filling me in on some of your information as we’re doing this interview. Second, I want to go back now and go through the story again. Or continue going through the story. You’re young. You don’t have the money to afford technology, decide you’re going to review it and by reviewing it you get to play with it and you also get to share the knowledge that you get with the world. I’m wondering how you go that. Do you have an example of a piece of technology that you were craving, that you couldn’t go out and buy but you found a way to get a hold of just so you could review it?
Interviewee: I mean, I would say if you go back to when I was in the 12 to 14 year old range, like I said I was building everyone’s computers for them. And when I’m 14 I start this website, I don’t really have any source of hardware. So what I would tell people is, “Look. I’ll be you a computer for free. You buy the parts. The only stipulation is I get to review everything that goes in that computer before you get it.” And hey, most people would deal with that just fine. They got a cheaper computer that was good and it just tacked on a couple more days of my review time to it and they were totally fine with it. I mean, that was…to people that had been around the industry a while, 3D Effects’ Voodoo graphics card, that’s how I got my first Voodoo, right. I had someone’s computer…
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Interviewee: …right? I had someone’s computer that you know, he wanted to build a gaming machine and I was like you’ve got to have this in it, and I reviewed it beforehand. That was the only way I got in. Like, 3-D Effects didn’t even know who I was back then, and even if they did, they weren’t gonna send something to a 15-year old kid.
Andrew: That’s interesting. I love that kind of creativity. What about the next level? How did you even know who at the companies to contact and ask for a review unit? How did you know that you could maybe exchange reviews or ads for hardware where, where did this come? Do you have any example of how you came across that or how you did it well in the beginning?
Interviewee: So, my first advertiser was a company called Megatrends, not American Megatrends. They were kind of like a NewEgg. The guy came to me and said, “Look, we want to put an ad on your website.” I saw what they had to offer and it was just computer parts.
I was like, “Yeah, yeah, sure, but do you think I could get parts in exchange for the advertising?” I’ll send it back, whatever, but I just need stuff to review. You know, a lot of people work that way, right. That’s actually how a lot of artists and photographers and creative people work because they’re…because the value of art in our society isn’t usually held very high.
So you have someone that’s really good at sculpting and someone that’s really good at painting, and they trade their work; and that’s how they acquire that. It’s no different from what I did. It wasn’t, I don’t know, it wasn’t premeditated or anything like that. I just looked at the opportunity that I had and I was like hey, it would be great…it would be really, really cool if these guys that sell the stuff would just let me use it for a little bit.
Andrew: They contacted you first?
Interviewee: Yes.
Andrew: Because I’m learning online, just doing it myself, and also from having these kinds of conversations, if you put stuff out there — if you put your ideas, if you put your writing, if you put your videos out there consistently — the people who are attracted to it, the people who want to work with you are just gonna find you.
It’s hard for me to believe because it seems so woo-ey, it seems a little too hippie. I like to plan out my life and know exactly how I’m going to get to the right person, but this works.
Interviewee: Yeah.
Andrew: And it sounds like it did for you.
Interviewee: Absolutely. I mean, again, you asked me earlier, would I have been more successful if I’d done the marketing rap. Absolutely. In terms of building a business and stuff like that, sure, but that’s not what I wanted to do, right. I’m not passionate about networking with people. I hate that. The thing I don’t like the most is a lot of people in business, a lot of people that are successful aren’t really fun to talk to.
I don’t want to have to put myself in those situations more than I already have to, right. So I kind of do what it is that I do and if it attracts the right people, that’s great. I’ve been fortunate enough this far and I really can’t complain.
Andrew: [Kern Mollack 32:50] agrees with you. He hates networking events. He feels superficial. I’ve gotta disagree with both of you. I love those kinds of events. Now, I know they can be a little bit smarmy and a little bit awkward, all that. I love it.
Interviewee: See, you’re passionate lies in a different part than mine does, right.
Andrew: Yes.
Interviewee: And that’s the key, right. Something I told you on the phone when we were discussing this interview, I was like look, I don’t actually like listening to most entrepreneurs because they talk about things that don’t make me comfortable. These ideas of business plans and monetizing customers and stuff like that, I don’t get excited about that.
I don’t know, usually with stuff like that there’s someone dirty involved that I don’t want to deal with, right. My passion is completely separate from that.
Andrew: You see, I specifically wrote that down here in my notes to bring up because it disagrees with my work, because I want to get opposing points of view on here. I see what you’re saying. Well, you want it, but this isn’t your area. This isn’t what you want to focus on…focus on how to build a business, how to get more customers.
Interviewee: Right.
Andrew: You just want to focus on the technology and you’re gonna read other people’s tech pieces, you’re gonna read other people’s reviews, you’re gonna read what’s going on in a space; tech specs, all that stuff. I get that.
Is there also a level here that makes you a little uncomfortable? Do you feel like well, I’m not like these people. Maybe I’m on the wrong path?
Interviewee: I wouldn’t say that I’m on the wrong path, right. It’s definitely scary because if you look at how the majority of the market talks about things, they talk about revenue, they talk about numbers, they talk a lot about that kind of growth. I don’t know, they talk about things that I’m not passionate about.
I’m not passionate about making money, right. That’s just not what I do. It’s that I’m passionate about something and in turn, that turned into a business and that’s great. Yeah of course, if you’re in my situation, there’s always the chance. You always run the risk if I don’t approach this CEO as a business man first and foremost that something terrible is gonna happen and you’re not gonna be able to do it again.
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Interviewee: …and you’re not going to be able to do it again. And I think over the years, I’ve been doing this for 13 years now, my philosophy’s pretty much this at this point: it’s that I don’t really care, right? If for whatever reason I can’t do like the business side of this doesn’t work out anymore, and I don’t see that it would, but if it doesn’t, that’s fine. I’ll just go do something else that I’m passionate about. Right? Like it’s…I think my story and the things that I try and tell to people – and this is why I spend most of my time when I go out on speaking engagements ,I talk to kids in school. Because…and I always tell them, I can’t tell you how to be successful, but I can tell you the things that’ll, I guess, will make you happy. Right? And it is a little too hippy, a little like too touchy-feely but I don’t know…I feel like people waste a lot of their lives, especially in the younger portions of it. And you know, oftentimes after they get into their twenties and thirties and start working for other companies and stuff like that…I’ve met way too many people that haven’t done an ounce of passionate work in their life. And it’s hard…
Andrew: Because it was all drudgery. It’s all whatever you have to do is what you have to do. That’s life.
Interviewee: Exactly. So my parents were both teachers, right, so of course I was going to college. But I was in a unique situation. I went to college to learn. I had a career. Right? By the time…and 2000’s when I graduated high school. I didn’t need to go to college to get a job.
Andrew: Your site was your job at the time.
Interviewee: Absolutely.
Andrew: Do you have a sense of how much money you were bringing in back then? Do you remember?
Interviewee: Uh, back…let’s see. I mean we had broken the million dollar revenue point by the time I’d entered college. Or maybe within the first year.
Andrew: And this is a business with pretty high margins, right? You don’t have to pay for even ink.
Interviewee: Oh, yeah. Absolutely. The margins are…it’s “how hard am I willing to work and how many other people can I hire?”
Andrew: How many people did you hire when you went to college?
Interviewee: When I went to college, I think the core staff was still only like two or three folks on editorial.
Andrew: Two or three folks, million dollars in revenue. That’s pretty good profits.
Interviewee: I mean our biggest costs are honestly the cost of sales because you’ve got to pay salespeople like actual…
Andrew: Outside sales people.
Interviewee: And then the cost of bandwidth.
Andrew: Okay. But that’s still not huge. We’re still not running…
Interviewee: Back then it was bigger than it is now.
Andrew: Was it? I see. Okay.
Interviewee: Because if you were a small time player back in ’99 you were paying top dollar for bandwidth. I remember the most I ever paid for bandwidth was like $1000 a megabit.
Andrew: So what does that come out to back then for a year of running the site?
Interviewee: Geez…I mean, we were like immensely profitable, right? We’re talking very, very high margins.
Andrew: Okay. So let’s focus a little bit on that. First of all let’s get to the number that I was telling people that we’ll reveal. And by the way, who’s reading this on my website will already know the amount because it’ll be in the headline or it’ll be in the body. But let’s reveal it for the live audience at least. How much is it? What’s your annual sales?
Interviewee: So I think the number we agreed to say is we’re below 5 but at least 3 million a year.
Andrew: Okay. So at 3 million a year in sales. If I were to put a headline on this that says “how a 14 year old built a website that’s now doing over 3 million in sales,” the answer to that question, if I could sum it up in one sentence, would be by focussing insanely on his passion. True?
Interviewee: Yeah, I would say that.
Andrew: So even if there were rational business areas that you should have focussed on, like an intelligent businessman, like sales, like picking up a book and figuring out how to write a business plan, you weren’t going to do it because your method was focus on your passion, focus on your love and do that really well and the rest will work itself out.
Interviewee: Yes. And I think that’s important because it’s the most – at least for me, right? The one thing I’ll tell you is I can’t tell you how to do something. But I can tell you what worked for me and this is actually my philosophy with a lot of things, right? I look at the world around me and I look at the things that make sense and I kind of integrate those into my life. And for me this worked. It made me happy. It’s not going to make everyone else happy but it’s something at least I can put out there.
Andrew: Okay. Let’s talk about the early sales that you made then. Here you are, a guy who just loves technology, who doesn’t get the same passion that I do from picking up the phone and trying to sell somebody, how did you figure it out? Because if people can learn how you made your early sales, I think it might be more useful for them than even hearing how I did it.
Interviewee: So if we talk about back in ’97, ’98, I really didn’t know how much what I was doing was worth. Right? So I told you, that first advertiser was like, “Hey, look. We want to put ads on your site.” And I said, “Give me hardware.” Now the second one I didn’t need hardware, I needed money. So…but I didn’t know how much I was worth so I was like…
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Interviewee: …I needed money. So, but I didn’t know how much I was worth. So, I was like, “Well, why don’t you just give me $50 a month.” And they were like, “Yeah, sure, $50 a month is fine.” And that was their rate. And then when the third one came up, I was like, “Alright, well, let’s try $150.” And so I tried $150. And then, you know, after a certain amount of time, we grew a certain amount and I would say, you know, “We’re thinking about raising rates to $200 a month now.” And I just, like I didn’t know. I was super nervous, right, because if these people say “No, my revenue’s gone and I can’t run the site anymore. I have to back to [inaudible] city.” So, I probably undersold myself a lot. But, hey, I did what I needed, right. I didn’t get greedy. I was like, “This is what I need and I hope that they’ll pay it.”
But it was very like, you know, when you’re a kid, you don’t really have an idea of how the world works, right. You think anything’s possible. And for me, there was a lot of that fantasy element in all of this. It wasn’t, “Well, this is how much what I’m doing is worth. This is how much time I’m putting into it. This is how much I need.” It was, “It would be great if they paid me this amount of money.” And that was it. And I remember the first time I sent out an email asking, you know, “Our rates are going up for this position. It’s going to cost $1,000 a month.” And I was like super, shaky nervous, right, cause in my eyes at that age, like I don’t have any concept of how much these companies are making. I didn’t know that if like $1,000 – I mean it was a lot of money to me. Like, I was so far detached from like the corporate mentality, right. Like I can’t even tell you how – I didn’t know what percentage of sales that was for these folks. I just knew what would be neat to have and what I’d be able to do with that. And I kept it within reason.
Andrew: And they were mostly coming to you. You weren’t making cold calls. You weren’t looking at who’s advertising on your competitors’ sites and calling them and saying, “Advertise on mine too?”
Interviewee: No, I was too shy and too nervous, right. I knew who was advertising on my competitors’ sites. And I always hoped internally. I was like, “God, I wish they would come to me.” And every now and then, yeah, I would send out a cold email, not usually for advertising sales but for like say I need to break into a new company, right. And that was kind of the tough part when I had a few companies that were sending me hardware, but other companies didn’t want to or they didn’t know who I was. And actually part of our, you know, one of the things that our third party sales staff helped out with a lot was they were, obviously, doing all these cold calls trying to get people to advertise and they were really good at talking to people, talking to companies and saying, “Look, you know, we need to work with you. And, look, there’s this kid and he’s doing all this great stuff.” And I learned a lot that way, right. Like, I learned how to talk to people. I learned the marketing side of it. And, you know, I used that wherever possible.
The other lesson I kind of learned from that was or actually from what I do is, if we go back to this theory or this idea that these PR people, these marketing folks, they’re paid to be my friend, they’re paid to talk to me. Well, one thing you get really good at if you, you know, if you do anything for 13 years – the one thing I got really good at was really good at reading people’s motivations, reading their emotions, reading their expressions, you know. And that’s something I focused on quite a bit to the point where now I actually use that in like my daily arsenal, right. Like I want to know – when someone approaches me, I get a vibe from them. And when someone starts talking, usually within like a 15, 20 minute conversation, I know a lot more about the person than what they’re letting on.
Andrew: You and I have had conversations for a while now. What do you pick up from me?
Interviewee: [laughs] I can tell that we’re very different in our approach to things, right.
Andrew: Yeah.
Interviewee: Like, I mean, you come off as, as an entrepreneur, as a business man. And that’s to be expected. But, I’ll say that, you know, when I get that vibe from someone, I’m much more guarded around them, right. Now, it’s different now cause, you know, we’ve got a big audience here. But, I mean, I won’t be – and, you know, there’s the other thing, you know, I get good at is this idea of, “How do you give someone the impression that you’re opening up to them that they have full access to you but still only be giving them maybe 15, 20% of what it is you have…
Andrew: How do you do that?
Interviewee: A lot of practice. [laughs] I mean…
Andrew: Do you have a couple of techniques that you do, that you use?
Interviewee: Um, you know, you have to look at when you interact with someone, when you meet someone, you have to look at very, very carefully how they react to various things, right. So, if you break it down to the most elementary level, you know how someone reacts when they’re happy, right. And you know how someone reacts when they’re not happy. So, the question is how do you formulate your information? How do you package your information to elicit more of the happy response and less of the unhappy response? And, you know, it’s a lot of guess and test. And that’s ultimately what it boils down to. And if you practice that for enough time, you get really, really good at it. And that’s something, you know, when I talk to a lot of these manufacturers, a lot of these companies, they’re giving me information, you know, about products, about technologies that are sometimes two years out in the future. And they ask me for feedback. And I have to somehow give them honest feedback that…
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Interviewee: …and they ask me feedback, and I have to somehow give them honest feedback that doesn’t compromise myself, doesn’t compromise the readership, doesn’t compromise the other manufacturers I have relationships with; but also tries to kind of further my agenda, which is to push for a better product, to push them to make the decisions that I think they should be making, and to make them feel totally comfortable in this whole exchange.
I mean, it’s a lot of juggling. It’s a lot of mind games. It’s a lot of mental juggling. And it’s a lot of…I don’t know, a lot of it boils down to expressions. A lot of it boils down to reading people. These are ultimately industries and anything regarding entrepreneurs…I guess I have the advantage of because I don’t exude this aura of you know, using people for what I need them for, people are more trusting of me.
In that, they let their guards down and that gives me a little more insight into what their motivations are.
Andrew: Right. I gotta go back a little bit and talk about sales here because I’m getting a couple of urgent messages especially from Entrepreneur28 who’s direct messaging me and making sure I ask you these questions, but it’s a valid question.
He’s saying sales is not second nature for most entrepreneurs. Andrew, ask him where did he get third party sales staff? How does he recommend any cost effective ones for startups? Basically, it sounds like Entrepreneur28 wants to build a business, but doesn’t want to do any sales, and is asking you for some advice on how to do that.
Interviewee: So, if you listen to the one common theme that past 50 minutes, it’s been I let people come to me, and that’s how it worked. The person that became my president of, head of sales, he came to me. It was just a creative labs event. He was like, “Hey, I’ve seen your site. We should talk.” Unfortunately, that’s not the best kind of…that’s not the best advice, that’s just how it worked for me.
Now, what I will say based on what I’ve learned is if you’re like me, if you’re not passionate about making money, and you want somebody to be a good salesperson, you’ve got to find someone that’s passionate about making money.
Andrew: And is he passionate about making money?
Interviewee: Yeah, absolutely. I mean he’s very, very good at what he does. That whole…you know you mentioned it yourself in other — or a lot of people have actually mentioned it in interviews that you’ve done — is that you know, I believe Raul even said that he was passionate. He wanted to make money. He wanted a BMW. You need to find people like that, right?
He said he could sell anything to anyone. You need to find people like that. They’re are a ton of people especially in college that are really motivated. That don’t have the kind of experience or work history to actually command a good sales job that you can align yourself with, and say, “Look, this is what I’m doing. I need a salesperson. Can you go do that for me?”
Andrew: All right, one more question about money and then I’ll move on to other areas here. I’ve been asking this of several people I’ve interviewed. We talk about lots of millions and lots of this and lots of that. Let’s talk about just one. What was it like when you earned the first million? Do you remember that day and what it was like for you?
Interviewee: I remember that day because I remember my head of sales asking me what it felt like to be a millionaire. My response was “no different” because that’s like, again, not passionate about money. If you ask me what the first time I ever got an exclusive on a piece of hardware, or the first time I got to meet like Pat Gelsinger, or these like industry legends, those things stand out in my mind.
The money side — as long as I could pay for everything, I was fine. Honestly, from a personal aspect, I didn’t want my parents to ever have to worry about anything. I didn’t want them to have to worry about paying a mortgage or stuff like that. My parents gave me a lot of wonderful opportunities. They always took care of me. I mean, my mom, she was getting her masters. She dropped out to stay home with me and kind of take care of me and raise me.
I felt a strong connection to them from a very, very early age. So the minute I got to a point where I could support them, I was done. Anything above that is just whipped cream and a cherry.
That was a big help to me. That was definitely a big help to me. I mean the first person I ever hired was my mom, and today she’s VP of the company, right. She handles all the finances.
Andrew: What did you hire her to do at first?
Interviewee: I mean as soon as we had revenue, as soon as we incorporated…
Andrew: To do what?
Interviewee: Just send out checks, make sure that we were doing everything legally. You know, cover the stuff that I wasn’t passionate about, but she is. You know, she has a lot of entrepreneurial spirit, right. She wanted to build a restaurant one day, so she went out and made a restaurant.
She’s really good with her hands. She’s really good at…I remember she wanted to re-tile a bathroom once, so she just picked up a book, learned how to do it, and did it. I’ve always said that the one thing that she’s not good at is anything to do with technology, but I always say that my mom was so resourceful…
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Interviewee: technology, but I always say that my mom was so resourceful and so smart and so confident in herself that she could do anything in the world that the one thing she couldn’t do, she made me to do for her. And I mean, these are things that really, really shaped me.
Andrew: You know what, it’s funny, I think the first person I ever hired was my mom too. My brother and I were selling, were producing and selling both paper guidebooks and software that were on CD’s. And my mom’s job was to print out the books, staple them, stuff them in an envelope and send them out and take orders or to create the disks, put those stickers on them the we used to have on floppies and send those out to customers and deal with, deal with the feedback, by the way, thank you for, before, we still have a little bit more here, I’m glad that you heard past interviews, but I’m even prouder and happier that you came on here and didn’t try to conform to their stories, or try to come in here and try to just battle them like they’re wrong, and here you’ve got the right answer which is just passion and just focus and so on. I’m glad that you’re here just being yourself and I hope that the people who are listening, maybe they say, “well this guy’s attitude isn’t exactly mine, neither is Andrew’s and accept that instead of trying to say, “how can I follow in their paths. How do I be exactly like Andrew, how do I try to be exactly like any one of his interviews.” There are so many different ways of doing it, you just have to find your path and I think that’s the big answer here, that’s the big message from all my interviews. Okay.
Interviewee: Well, I would say one thing on top of that is, I can’t go out and do what you do, right? It’s not my passion and you know, one thing I always stress when I talk to school kids and stuff like that is, if you and I go into a situation and you’re working for a job and I’m working because it’s my passion, passionate work always trumps work, work. It does. You know, it doesn’t matter what kind of deficit I’m at, it doesn’t matter, all the details, someone who’s working because it’s their passion will always, always be able to be more competitive than someone who’s working because it’s their job. And the thing I stress most, and this is the reason I talk to kids in high school, and in middle school, is that, focus on finding what your passion is. ‘Cause that’s the important part. If you can figure that out, then the rest is a lot easier. But you don’t want to find that out when you’re in your thirties or forties and have kids and responsibilities and stuff like that. It’s not impossible to do, I’ve seen people do amazing things, but it’s a lot harder to do. And I’m all about making life easier on you whenever possible, because it’s difficult, it is very, very difficult to do the things, to lead a good life, to lead a life that’s good to both you and actually beneficial to the world around you.
Andrew: You know, you’re so right about that passion and how much it gets more out of you than somebody that’s just filling up space. Like, let me give you an example, when Michael and I, my brother, started our business, Bradford and Reid[sp] we had no money and we were competing against these guys who had tons of cash, and the way that I knew that we would beat them is I knew, that when I went to sleep, when I woke up, when I was at work, all I cared about was this business. I was so passionate about it, I never wanted to let it go, never wanted to sell it, never wanted to cash out, I just wanted to do it every day and make more money every day.
Interviewee: Okay.
Andrew: But not to be rid of it. And I knew that all they thought about every day was their exit. How are they going to exit? Who are they going to exit to? Who should be nice to, should they be nice to because they might be a future buyer of the company? Should they exit public? Should they exit this way? And I always said, nobody could ever do anything right or anything well if they’ve got one eye on the exit all day long and that’s the way we would, that’s the way we competed against them even though we didn’t have the same resources. Alright but this interview isn’t about me it’s about you so let me ask you one more question
Interviewee: Sure.
Andrew: that we talked about earlier, goal-setting. All the business books tell you to write down goals, five year goals, one year goal, what’s your point of view on goal setting?
Interviewee: For me, and obviously this is where I stray from like the typical entrepreneur, but the philosophy’s similar, right? The idea behind goal setting is you take a big problem, and you break it down into smaller steps, if you’ve ever followed any CP architecture articles I’ve written, I mean this is pipelining that’s all it is. And the reason it works is because it actually works, right? It makes sense. The one thing I do and the one thing I stress, whether it’s a business problem, whether it’s something that I’m writing about, whether it’s just a life issue, is you take whatever problem you have and you break it down into small components that are easily manageable. And there’s a funny thing that the human mind does, it’s the reason we like keeping score in games, it’s the reason we like achievements on X-Box 360, the human mind responds really well to little rewards. If those rewards come in the way, you know of checking off a simple part of a much bigger problem, you end up being more productive, you end up being happier, it lifts your mood, it’s something that’s a net positive on
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Interviewee: …it’s something that’s a positive on you. That’s something that hey, it took me a while to figure that out, but it is actually very useful. You can take that to the macro scale, right. You can say, “Look, this is where I want to be in five years. Well, let me break it down to a yearly kind of cadence; and let me break down that year into kind of segments. And let me break those segments down into physical things that I need to be doing.”
But make them simple tasks, right. Make them simple things that you know you can achieve because when you achieve it, regardless of how simple it is — and I guess the core area here is like taking out the trash — even though it’s not a big deal, when you do it, you feel better about yourself, right. Putting that check through the box is actually really, really important. The same thing in business, at least that’s what I’ve found.
Andrew: So you’re saying, I see, you’re not giving me one clear answer one way or the other. You’re giving me something that’s a little more you and a little more nuance than a simple answer.
Interviewee: Yeah. I mean, I’ll tell you this. I never had a five year plan, right, at no point. Again, I didn’t start this as a business. My five year plan is as long as I’m happy doing what I’m doing, and as long as I continue to prioritize properly and do stuff like that, I’m happy.
Andrew: Let me stop you there. I just, I thought we were gonna end, but now I’ve got to address this issue.
Here’s the thing. A lot of this interview has been very happy, go lucky. Somebody who listens to this is now gonna say, “That’s great for him. Everything went rosey for him since he was 14 years old. I cannot relate. My life is harder.
Let’s be a little more relatable here. Let’s talk about maybe one of the setbacks that you had along the way because it couldn’t have been as easy as I’ve been focusing on here.
Interviewee: Oh, no, no. It’s not easy at all. I mean I was working 60-80 hours a week in high school.
Andrew: In addition to high school?
Interviewee: Yeah. There was high school and then there was…I mean, basically when I was done with my homework, I worked until I was done with my work. Sometimes that was two hours before I have to wake up.
Andrew: Did you have a big setback though? Did you do all this work and maybe at one point it wasn’t working? Maybe at one point your site went down? Maybe at one point you had a competitor who copied everything and was doing better and stealing your audience? Were there any of these big shakeups?
Interviewee: Oh, totally.
Andrew: Can you share one? One of the big, dramatic ones?
Interviewee: Let’s see, what’s the best way to do this? So, when the dot-com bust happened, right, this is when I learned a very, very important lesson. The lesson was, when I worked the hardest is when I made the least amount of money. So, AnandTech has always been profitable, but for three months during the dot-com bust, like right after it happened, you know, all the ad revenue dried up.
We were actually really, really worried. That was the first time when I was like hey, I’m doing what I love to do, but it looks like there’s not gonna be any money left. I really didn’t know what to do. I was a freshman or sophomore in college when this happened, and that like really shook me up.
It was like this is all I’ve ever known for the past several years and I really didn’t know what to do. That’s when I realized that there isn’t this correlation between how hard you work — direct correlation to how hard you work — and immediate result in revenue. It doesn’t work like that.
Now, some people take that to kind of the degree that well, I should only work when there’s a lot of money happening. Obviously, the lesson here is if you work when there isn’t a lot of money happening, then that’s what makes a lot of money happen later, right.
That was a big issue. I remember one of the big hang ups we had was, because again, we had the separation of church and state with advertising and editorial, during those three months is when we lost our biggest advertiser because they weren’t happy with what I was writing.
I mean, this was a huge number. I’m talking like $20,000 a month back then. It was gone! They were just not happy with what I was writing. That’s a huge setback right, like what do you do? There’s nothing you can do.
Andrew: So, let’s talk about how you reacted to both of those issues. How did you react when the dot-com bubble burst? And the way that you lost some of your revenue; how did you get over that?
Interviewee: There’s nothing you can do, right. Back then there were three employees and we weren’t really taking a huge salary, none of us were. Every penny that came into the company got reinvested back into the company.
So, it sucked, but hey, we just have to work harder and make less money. That’s fine because our goal isn’t to make a lot of money. This is where again, it helps to do this at a younger age when you don’t have to worry about such big responsibility.
I mean, what do you do back in ’08 and ’09, what do you do in these types of periods? Well, you’ve got more mouths to feed, right? So, everyone’s got to scale back. You have to do the things that make sense.
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Interviewee: You have to do the things that make sense. I mean, the one thing that was told to me, back when the economy started getting really shaky, was big companies never cut quickly enough. So just make sure you cut very fast, and that you’re focused on it. And you know, we scaled back where necessary, but now we’re at a point where we’re hiring. We’re hiring a lot of people, more than I’ve ever hired before.
Andrew: OK, so let’s talk about the second issue. You lose about a quarter million dollars in advertising because your advertiser is not happy with what you’re writing. How do you get over that?
Interviewee: You can’t. Honestly, there’s nothing.
Andrew: You accept, and you say this is the way we’re going to do business.
Interviewee: Because if I had compromised then, and this is a decade ago, if I had compromised then, that’s a slippery slope, right? And that’s the cardinal sin in publishing, right? That’s the line that can’t be crossed, that can’t be blurred. And it’s rarely that discreet, right? It’s rarely that black and white. And since then, I’ve only had, maybe two other situations in running the site, where it’s been that blunt. Where we don’t like what you’re writing, and because of this, we’re not advertising anything. And those are the situations when I talked about when I stopped being a nice guy. It’s in those situations because I am not. And that’s the beauty of having this third party sales staff, right? I don’t care. They hate it. And they call me up, and they’re like, “Look, this is a problem. What can we do?” And I’m like, “Look, I tell the truth. I’m sorry.”
Andrew: Do you every kick their butts? Do you ever just say, “Listen guys, we’ve got to increase sales here. I see the market’s going better. I think we’ve got more money that we could be bringing in. I need you to work harder. I need you to call more people. Why is there not an advertiser on my site that there is on another person’s site?”
Interviewee: You know, I always do point out when there are ads that are on other sites that we don’t have. And I always, the other thing I do is I say, “Look, these are the things that I’m excited about. Go to these companies, and see if they want to advertise.” And unfortunately, and this is where I’m not a good salesperson, or it’s good thing that I’m not, you know, branding myself as a businessman, because oftentimes the things I’m most excited about aren’t the things that bring in revenue. So it’s, you know, otherwise I think revenue would be a lot higher.
Andrew: [Laughs] What’s the biggest offer that you got on the business?
Interviewee: I terms of a buy-out offer?
Andrew: Yeah.
Interviewee: Quite a bit. [Laughs] It’s you know, every year we have someone come by that offers something.
Andrew: Most of the 15 million?
Interviewee: Yeah, I would say so.
Andrew: OK.
Interviewee: I would be comfortable saying that. Usually, it doesn’t work for one of three reasons. The fit isn’t right from a publishing standpoint. And that’s really simple, like it’s, I know that the day after we sell, or within three years, the site’s not going to be the same anymore. And it’s a problem. I made a big mistake. When I started the site, I put my name on it. This is my legacy, right? Like, at least for now, this is like my baby, and it’s, I don’t want it to be left to deteriorate into something that isn’t a good representation of my name. It’s my life’s work at this point. You know, 13 years, and I’m 27 now, that’s a huge part of my life. It’s the only consistent thing outside of my parents.
Andrew: So, it’s, a reason…
Interviewee: It’s either that, or it’s that the money isn’t right.
Andrew: And the third?
Interviewee: Right. The third would be a combination of those two, right? Like there’s a, in my position, I’m not interested in a quick exit. I don’t need that. If I wanted to, it could happen. But, I guess, I don’t really have something that I would rather do at this point.
Andrew: OK. All right. Finally, for anyone who’s thinking of doing an interview with me, what do you say to them? I’m kind of fishing for a testimonial, but I won’t push too hard here. I just want to get, actually, here’s the thing. You just did the full interview.
Interviewee: Yes.
Andrew: I notice that some people are nervous about doing any kind of interviews. They’re especially nervous because there’s a camera. What do you say to people who are, to entrepreneurs who are interested in doing an interview, but aren’t so sure that they’re ready?
Interviewee: Oh, you’re not that bad, man. Like, you are, this is not, you know, the thing is I’ve spoken a lot publicly, and I’ve done a lot of these types of things. And I’m always super-nervous going into it, right? But, it’s not a, it’s clear what you’re interested in, and it’s clear of the kinds of things that you’re trying to get me to talk about. And it’s clear what you really want is to be a resource for other entrepreneurs, to say, just as I’m a resource for people interested in technology. You want to be a resource for people that are interested in doing their own thing. And I think that’s an amicable goal, right? Your motivations may be one or another, but the goal, I think, is good.
Andrew: What do you mean, my motivations are one or another? What are you worried about here?
Interviewee: [laughing] Well, no, I mean ultimately, like you, I want to make money, right? There might be a business aspect to this, but I think that doesn’t preclude it from being a good thing, right? Now, all businesses are, have a negative impact on…
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Interviewee: Right? Not all businesses are, have a negative impact on the public around it. I think if you can get people to kind of tell the personal side of it, tell the personal story, ‘cause we don’t really need more people telling me how to raise capital, that’s not the hard part, what we need are good leaders, good role models, good people that show you that these are paths that you can take in life, that are, I mean this is where I’m getting too happy go-lucky again, but you need those kinds of people, right? Like you need some of the new
Andrew: Who else should I be talking to like that? I want to get, I noticed that I was focusing too much on the U.S. because I happen to live in California, and I’m too focused on California for that reason, and the audience told me, “Andrew, broaden, go outside of the country,” and so I’ve been doing that, I noticed that the audience is telling me that there are too many men on the site, frankly, I’ve had a hard time getting more female entrepreneurs to come here and do interviews. But, I’ve opened myself up to find more female entrepreneurs to interview. Who, who are you saying I should be looking at? And if you have any specific people who you think, “these are good examples to meet, I think Andrew you should meet them, I’d be happy to.”
Interviewee: You know it’s, I don’t really have a specific to tell you, I remember that when people would interview me back in high school, they would always ask me, “well who are your role models? Who do you look up to?” And I felt like the, the person that I should say back then, was Bill Gates. It wasn’t true, but I felt like that was what everybody wanted me to say. And the thing I learned over the last decade plus is that role models are everyone around you, right? They’re my friend Manny or my friend Joy, they’re the people that aspects of their lives, aspects of what they do are things that you aspire to be. And it may just be, hey this person handles this type of problem really well, and I think that’s really a strength that’s rarely, I guess, highlighted in any of these types of interviews. Right? And I’m not just saying you’re interviews, but I’m saying people don’t usually kind of stress that about people, right? You know, people are always looking for, here’s the Michael Jordan that you want to try and be like, but you always end up disappointed if you go down that route, right? If the focus is on, I guess, individual wins, independent things that are great about them, because everyone has something unique about them, everyone’s passionate about something, and everyone has a strength that you know, very few people in the world have and if the focus is on that, it doesn’t really matter who you get, it’s a question of can you pull that answer out of them. And you know, I’ve always thought that I don’t really interview well, I just, I can answer questions. And if I have someone that asks me the right questions then hopefully what I provide is good information.
Andrew: Alright. You know what, actually? You are opening my eyes to a different set of questions and a different way to interview and I think the reason is, unlike most of my guests, you’re a journalist. And I should probably be talking to more people who are journalists, maybe apart from these interviews, about how to ask better questions. How to really pull out the meaning behind the story and not just the numbers behind it and I don’t know exactly how to do that but that’s interesting and
Interviewee: Well, I’d caution you in your journey there. So, the one thing that I always tell people is that I hate the term journalist. Because that has a negative connotation in my eyes.
Andrew: Really? Okay.
Interviewee: Right, because if I view the majority of publications out there both from the internet and the cable T.V. and those types of realms, as being entertainment first and education second, then by definition, the people who are journalists over there aren’t my kind of people. And that’s why, I don’t know, I don’t usually call myself a journalist.
Andrew: Alright, so what do you call yourself?
Interviewee: Depends on who you’re talking to, right? Like for the product guys, when I talk to a lot of these manufacturers, I consider myself a liaison between the people that make the product and the people who buy it. And I make sure that there’s balance in that situation. I want to make sure that the people who are buying the product aren’t getting screwed over and I want to make sure that the people who make the product are making what the people who buy it, want. But I believe there are great journalists out there, I believe there are great people that you know can teach you how to answer good questions and that can help you in that regard. And you know you’ve had people like Leo LaPorte[sp] on and stuff like that and I think you can definitely do well there, but just be careful in that regard, journalists are not all, they’re not all good.
Andrew: Okay, alright, fair enough. Alright, well thank you. Thanks for doing this interview, I’m really glad that I got to meet you and I appreciate all the time. As we’ve said several times here in this interview, we did a pre-interview and conversations here that have that pre-interview first, I think end up going so much better, end up being more useful to the audience, so I’m thanking you for spending two hours with me, actually, maybe that was more like fifteen minutes the first time but, two conversations with me
Interviewee: Cool
Andrew: just for the audience here and I see that they’re thanking you too.
Thank you Anand. Thanks for doing this interview.
