$300M+ Founder: What Nobody Tells You Before Selling Your Business | 146

[00:00:00] Ankur: The Teachable exit was about 250 million.

[00:00:02] Nathan: Ankur Nagpal built Teachable and sold it for $250 million. And then he built Carry and sold that for 76 million.

[00:00:09] Ankur: The only reason I was able to sell Carry is because we didn’t raise that much. A very large, very prestigious firm offered us $40 million.

[00:00:18] Nathan: Of funding.

[00:00:19] Ankur: And the worst part is we were tempted.

[00:00:20] Nathan: I built Kit, got a $200 million acquisition offer from Spotify, and turned it down. Ankur raised capital and sold companies. I bootstrapped mine and kept it.

[00:00:31] Ankur: Founders can sell their company and pay zero taxes on 10 to 15 million bucks. To me, it felt like black magic.

[00:00:37] Where it gets crazier now is the 10 to $15 million limit is per shareholder.

[00:00:42] Nathan: I feel like we should not g- keep that information, ’cause it’s

[00:00:45] Ankur: absolutely…

[00:00:45] Nathan: We talk about the bets we make on other people’s companies, and why product market fit is still critically important.

[00:00:51] Ankur: The thing that doesn’t materially become easier is how hard it is to find true product market fit.

[00:00:56] Everyone tells you really nice things, and you have to kind of filter out that .

[00:00:59] Nathan: We took opposite paths. I

[00:01:01] Ankur: think bootstrapping should be higher status. VC means you kind of failed to, like, run a business and grow with profits. The

[00:01:06] Nathan: question is, do either of us regret our decisions?

[00:01:09] Ankur: Nathan, I’ve been doing for 10 years straight, and I hate it, but it works

[00:01:16] Nathan: Ankur, thank you for coming.

[00:01:19] Ankur: Thank you for having me.

[00:01:19] Nathan: I feel like we grew up together in the software world, where as you were building Teachable, you were always, like, 20% ahead of Kit in revenue or somewhere in there. And so when I was like, “Wait, how do you get a better deal on Stripe fees as you pass 10 million ARR?”

[00:01:37] or something like that, you know, Ankur’s who I would turn to. And then we were also both building in the creator economy. We shared a lot of customers, and, um, yeah, learned a lot from each other and all that. But for anyone who doesn’t know, will you share just a little bit of the, the h- the arc of Teachable, um, over the years, and then we’ll dive into more of the conversation.

[00:01:55] Ankur: Absolutely. So, um, I started Teachable back in 2014. What year was ConvertKit?

[00:02:01] Nathan: Uh, 2013.

[00:02:02] Ankur: 2013. So very, very similar timelines. Um, it first started as a platform for literally my buddy and I, where we thought it would be really cool if we had a place where we could teach our own courses without having to go to a marketplace.

[00:02:15] That was the first version of Teachable. Then the creator economy effectively blew up over the next few years, and by the time we reached 2020, right before the pandemic, we were doing about, you know, 25 million in revenue. Our creators were selling hundreds of millions in courses every year. Um, at that point, we received a pretty nice acquisition offer that I took, and I think I spoke to Nathan around it, like, “Hey, we’re gonna do this.”

[00:02:39] And, um, and yeah, we ended up selling the business and then COVID hit. The business basically doubled from 25 to 50 million in revenue in the next three months. Um, but at that point, you know, I was fairly relieved to be out of that business. And, and yeah, I haven’t been super directly involved in the creator economy since, but I’ve gone on to start another business that I’m sure we’ll talk about.

[00:03:00] Nathan: Yeah, so I remember ta- you and I were talking along with another mutual friend, and they said like, “Oh, wow.” Like, you sold at the perfect time as the world was shutting down. And then it was that whole thing, it was like exit at the perfect time, you know, the stock market was down like crazy. And it was like, wait, did you sell at the worst time as it then went up like crazy?

[00:03:19] And ultimately, I mean, you hold meaningful equity in the, uh, in the parent company, so I think you did just fine.

[00:03:24] Ankur: Yeah, totally. And like my general philosophy is I feel like life has been so good to me. I don’t want to be that annoying rich person wishing that things could have gone slightly better. Like, things went pretty fucking well, so I’m fairly happy.

[00:03:39] Nathan: I, I think, I think that’s great. Um, how did you think about- That decision to exit versus keep going, uh, at that stage and, and, like, w- what tipped it over to saying yes?

[00:03:51] Ankur: The short answer is after building a business for almost six years, and I wanna hear your version of this, but I started feeling a bit tired.

[00:03:59] Like, it takes a lot to build a business. Like, you have to push unnaturally hard for many, many years. And we reached an inflection point where I looked at what we had, and I saw our technology, I saw our platform, and to make it dramatically better, like in my mind, if we had to, like, really give it a go, my assessment is we have to rebuild this whole thing from scratch.

[00:04:24] Meanwhile, the business was growing, and we weren’t actively looking to sell, sell the company, but when an offer came in from people who I thought were very smart, very good, very kind, all of which are important, um, it just, you know, found me at the perfect point of being kind of tired. It became basically a no-brainer.

[00:04:42] Curious for your perspective. How, how are you still building this company so many years into it?

[00:04:47] Nathan: Uh, I am, I am a little tired in this moment, but I think that’s because we’ve been building out this space till, like, midnight or 1:00 AM the last, like, four or five days. Part of the reason that I wanted to talk is that we have very different approaches, right?

[00:04:59] You know, despite building for similar amounts of time, I’m on company number one, you’ve exited company number two, you’re now running a fund, you’re now doing other things.

[00:05:09] Ankur: I, I think I’ve tried at least twice to see if you’re interested in selling, representing different parties. And not, not in recently, but back in the…

[00:05:15] And you’re always like, “I think I may do this forever.”

[00:05:18] Nathan: Yeah. And th- what I … The way that I’ve thought about it over time is build a business to sell it, so it has all of the things that investors really want, so recurring revenue, high gross margin, uh, a durable customer base that’s spread across a lot of different, um, users and all of that, and then don’t sell the business.

[00:05:39] ‘Cause turns out, uh, I believe that a business that is really good to sell is probably also really good to own and operate. Um-

[00:05:45] Ankur: There’s a, there’s a really great quote I love. It’s, like, “Build your business like you’re going to own it forever, otherwise you might just have to.” And I think that’s I think that’s, that’s sort of testament to how you’re thinking about it.

[00:06:00] Nathan: Yeah, and I, I’ve- I feel very lucky that the customer base that we have is one that I, like, am deeply in love with. Uh, this, this, uh, stage that we’re on is actually a bookcase. Uh, in true New York City fashion, it’s, um, used for all kinds of things. It folds down, uh, to turn into a stage for events and folds back up.

[00:06:20] Uh, but it’s our, our, um, New York Times bestselling authors who are on Kit, and there’s, I don’t know, 25 or 30 of them or something that we had showcased, uh, on here last night. And, you know, I just feel really, really lucky that we get to serve those customers. So I plan to run this business for a very long time.

[00:06:37] Uh, I always tell the team 10, 10 years, and they’re like: “Wait, didn’t you say 10 years, like, five years ago?” And I was like: “Oh, no, it’s a rolling 10 years.” But I think the, the biggest thing that’s made that difference is having both a business model that endures, like recurring revenue is amazing, um, but then also having a customer base that we really care about.

[00:06:57] And, like, I would spend all of my time with creators and, and love every minute of it. Um, so yeah, my… I- I fully expect to be… We’ll do some event and you’ll be like: “Oh, yeah, I sold company number six.” And I’ll be like: “I, I still have company number one.” I don’t know if you have any thoughts or commentary as, as we’ve, uh- You know, had these conversations over the years, but-

[00:07:16] Ankur: No, I mean, look, I, I respect and admire that.

[00:07:20] Like, I think, I think there are some people who sort of build one business and see it as their life’s work, and I think that’s incredibly admirable. Every time I’ve started a company, the idea has always been build it, you know, without, without aiming to sell. Like, I think if you start a company with the goal that you’re going to sell it…

[00:07:39] And sometimes I get concerned. Like, I’ll go speak to a group of founders, and everyone who hasn’t even started their company wants to know about the exit. Like,

[00:07:45] Nathan: what’s- What are the multiples? How do you feel about the market in this? It’s like you haven’t provided- Yeah … any value to anyone. Companies are just, it’s just a value exchange, and spend all of your time on how do you create value and not, you know, what could my possible exit be?

[00:07:58] Ankur: Totally, totally. But at, at every point I’ve- I have an open mind where I’m building the business. And I think as a founder you’re always willing to sort of hear what your business may be worth. And at any given point there’s, like, some kind of expected value math in your head, um, not just on what is the financially best outcome, but what is the best outcome for every single stakeholder, which means every single investor, every single employee, past and present, every single customer.

[00:08:28] And then your job as the founder is to try to find the equilibrium point across all of that.

[00:08:34] Nathan: That makes sense. Okay, let’s talk about Carry. So you just sold Carry, is it a month ago? Yeah. It’s quite

[00:08:39] Ankur: recent. Uh, well, the deal was signed about two months ago, and will hopefully close in two days, so.

[00:08:45] Nathan: Okay. And then actually, I think you can say some of the numbers on there of the, uh, the Teachable exit was around 200 million?

[00:08:53] Ankur: The Teachable exit was about, we were doing about 25 million in revenue, and it was a 10X, so about 250 million.

[00:08:59] Nathan: Okay.

[00:08:59] Ankur: The Carry business we were at about 4 million in annualized revenue, and, uh, all in the exit was about 75, $76

[00:09:09] Nathan: million. Okay. And then, um, that’s a fantastic multiple.

[00:09:12] Ankur: It is a fantastic multiple, but again, I think different types of acquirers pay for different things, and we’ll get into that.

[00:09:18] But with the Carry business it was, you know, acquired for different reasons than sort of- Right … pure multiple on revenue.

[00:09:24] Nathan: Yeah, um, so, you know, what is Carry as a business, and, um, like where were you planning to take it?

[00:09:30] Ankur: So the, the vision behind Carry has always been that while I sold Teachable, um… As a little bit of background, I’m a first-generation immigrant here.

[00:09:40] I did not grow up in America. I moved here for college. I know nothing about the US financial system. And while selling Teachable I, you know, talked to lawyers and accountants before structuring the sale, and it blew my mind to learn about the sort of- Well, I mean, to me it felt like black magic in the US tax code, uh, where by talking to the right accountant, I was able to save many, many millions of dollars by learning about things like the QSBS tax break and all of these different things.

[00:10:09] Um, the vision behind Carry always was there’s so much cool stuff in the tax code. There’s no good way to productize it to the average person. Um, so Carry was a platform to do that for business owners. The first and primary product we had was a one-person 401. So for anyone who’s self-employed, typically your employer provides your 401, which again is a quirk or nuance of the US tax system.

[00:10:33] But if you’re self-employed, no one does that, and that was our primary product.

[00:10:36] Nathan: That was my experience as well, where as you learn these tax things over time, you talk to your, uh, CPA that you hire and you’re like, “Anything else I should do?” And they’re like, “Yeah, no, you’ve, you’ve pretty much covered it.”

[00:10:44] They’re like, “You’ve… You’re dialed in.” And you’re like, and then you go talk to a founder friend and you learn about QSBS or QSBS stacking or some of these other things, and Then you go back to your accountant and like, “What about this?” And like, “Oh yeah, no, you could totally do that.” And you’re like, “What?

[00:10:58] You have one job, and you did not do that job.” For any- Do you wanna give a, a quick explanation of QSBS for, uh- Yeah … ’cause I feel like we should not get- Yeah … keep that information ’cause it’s,

[00:11:08] Ankur: it’s- Absolutely. It’s quite- So QSBS is something, uh, that blew my mind, and I only found out about it about, uh, two months before selling my first business.

[00:11:16] But the way QSBS works is if you are a startup founder, which is typically the founder of a C corp. So as a creator, most creators aren’t set up to be a C corp. Um, you probably shouldn’t, since there’s downsides of being a C corp, like double taxation, but if you are raising venture money or you want to go public someday, you likely are going to be a C corp.

[00:11:36] I’m guessing you started as an LLC and then converted? Yep,

[00:11:38] Nathan: and then we converted.

[00:11:39] Ankur: Yep, exactly. So the way this works is if you hold shares in, in this C corp for five years and you sell your business, you pay no taxes on up to $10 million. Uh, last year there’s a new rule change that changes it to $15 million.

[00:11:53] Um, so that means founders can sell their company and pay zero taxes on 10 to 15 million bucks, which is, one, super crazy. Where it gets crazier now is the 10 to $15 million limit is per shareholder, so you can actually multiply it. I can give shares to my family members, to my mom, to my dad, like people can do it to their kids.

[00:12:14] Now as a family, you multiply that from 15 to 30, 45, $60 million. Um, it’s actually remarkable because people think of how high taxes are in America, and there’s tax breaks like this for business owners that a lot of people don’t know about.

[00:12:29] Nathan: And there’s even layers beyond this of like if you convert from an LLC to a C corp later, it’s 10 times the basis and, and there’s all kinds of other rules within that.

[00:12:37] But it, it just points to how important a business like Carry is because it’s explaining these things and making it accessible when really you, otherwise you, you have to be an insider or someone has to tell you, you know, like other founders or something like that, to then know that this exists to be able to, to implement it.

[00:12:54] Okay. So with Carry, what were the, what were the things that Carry was acquired for, uh, versus what Teachable was acquired for?

[00:13:01] Ankur: Yeah, absolutely. So with Carry, we were at about 4 million in ARR about three and a half years in, and our path was decent. Like it, you know, it was… The way I think about it is it’s probably similar to a lot of the early Teachable and ConvertKit growth where we were doubling year on year, which is, you know, 100% year on year growth.

[00:13:23] But given everything happening in the world today, it wasn’t a growth rate that was satisfactory to me. I wanted us to be growing faster. Um, what I felt is we found product market fit in this, like, pretty small niche, and this would keep growing, it would keep compounding, but the path to hitting 100 million in revenue was still, like, 10 years out or some amount of time where I felt like the time it would take to build a massive business from this, um, was too long for my amount of patience.

[00:13:54] Um, as this was happening, I was being recruited by AngelList to run their new public venture fund, USVC, which to me sounded like the coolest opportunity in the world. Um, it’s a fully public venture fund where I could tap into all the content and marketing I had been doing while, you know, running a portfolio, opening up access to private markets for, like, every person.

[00:14:16] It also had some form of regulatory arbitrage, or not arbitrage, regul- regulatory work that has gone into it because Prior to this type of structure, only accredited investors could invest in startups. So this seemed like a very good opportunity. Um, however, every time we had a conversation, I, I told the AngelList team that I had certain obligations to all the stakeholders I mentioned, to my team, to my cap table, to myself, to actually find a good outcome for the Carry business.

[00:14:49] Um, and after a lot of negotiation, this whole thing was structured as a acquisition that was at least in part to have me come on and run this venture fund moving forward. And as a result, the multiple is, you know, far more generous than someone buying it for revenue.

[00:15:05] Nathan: Yeah, that makes sense. Uh, that, and I was very curious about to what extent the technology was acquired, the, um, you know, some of the…

[00:15:12] If AngelList wa- wants to run that across a much bigger portfolio, or if it was really about the team or whatever else.

[00:15:17] Ankur: So, so here’s where it gets a little crazy. So AngelList said they wanna buy us. After a lot of negotiation, we got up to 70 million across cash, equity, earn out, a lot of that. But then it turns out they didn’t actually care about the entire platform underneath.

[00:15:34] So I basically negotiated for the ability to take the underlying platform and sell that to a second buyer. So we took that, and then we found a second buyer for the Solo 401k platform. Um, but all of that, right, that 4 million bucks in revenue only was able to get 6 million in a sort of very simple all cash asset deal.

[00:15:56] So that kinda shows you, like, multiples and how bad they can be when you have to sell a business versus when someone is coming to you to buy a business. It’s a completely different game.

[00:16:06] Nathan: Yeah. Okay, so talk about that, ’cause that’s an important distinction of, uh, businesses being bought versus being sold.

[00:16:11] Ankur: So the core Carry business, which was being bought in a way that it was opportunistic, we were able to sell for $70 million. Then what’s left, which is, you know, the u- underlying asset that was generating 4 million a year that we had to sell. You know, I had to get rid of this thing, and I wanted to find a good partner.

[00:16:29] We were only able to sell that for 6 million. So you see the difference, right? 70 million for basically talent and, like, the promise for what could be, and 6 million for the actual asset.

[00:16:40] Nathan: Yeah, that’s a huge difference. Okay, let’s talk about another difference in how you and I operate, um, r- in fundraising versus, uh, staying bootstrapped.

[00:16:50] And we actually, we’ve done some secondary transactions, and so we can get into the, the pros and cons of that. But yeah, how do you think about raising? ‘Cause you raised for Carry. You, you could have self-funded that from there. What was the reason that, uh, you raised money for Carry specifically instead of purely self-funding?

[00:17:06] Ankur: There were a couple of reasons. Um, one big one is fintech is fairly expensive. Like, as, as we would’ve kept building it out, there was a high cost of compliance. Could I have funded it fully from my balance sheet? Probably, but it would start getting a bit irrational- Right … where I now have, you know, a lot of my money in this company when I already believe my time is my most valuable asset, and I’m investing that in the business.

[00:17:32] Um, so that’s why I did raise venture funding. However, that’s also relevant because when you raise venture funding, you have… You effectively sign in, in my mind, an implicit promise that you’re going to, like, go for broke. You’re going to try and grow really, really fast. You’re not gonna pay yourself a lot of money.

[00:17:53] You’re not gonna be wildly profitable and kind of chill. You’re going to live a pretty hard life for the goal of trying to make this worth billions of dollars. Um, and I think that decision is related to why I felt like we weren’t growing fast enough. Had this been a business that I fully owned, 100% growth is fine.

[00:18:12] You know? I can take my time. But because we raised venture capital and I signed that implicit promise, I had to free myself, or at least felt like I had to free myself of that implicit promise in order to, like, you know, be able to do what I wanna do.

[00:18:25] Nathan: Yeah, and I think that’s… You have a lot of flexibility when you either stay self-funded or you set the expectations of, like, this is the style of business that, that you’re building.

[00:18:36] Totally.

[00:18:36] Ankur: Totally, and I, I always tell founders, ’cause sometimes founders don’t realize that’s what they’re doing when they’re raising venture capital, because VC for whatever reason is seen as higher status. I think it shouldn’t be. I think bootstrapping should be higher status. I think VC means you kind of failed to, like, run a business and grow with profits.

[00:18:54] But because of VC seen as higher status, you s- now see so many people, um, who don’t know better raising venture capital, and then getting, you know, sort of trapped where they have businesses doing millions of dollars a year, but maybe it’s growing 50 to 70% being profitable. A really good business, but a lot of great founders feel super trapped because of the way they’ve raised money for it.

[00:19:17] Nathan: Every time in decision-making that I’ve felt unsure of when I’m trying to decide between A and B, well, I have some family members who, uh, optimize for what’s the best story. Like, what’s the most entertaining outcome?

[00:19:27] Ankur: Do it for the lore.

[00:19:28] Nathan: Do it for the lore. That’s one way to do it. Um, something that I’ve always thought of is what preserves optionality.

[00:19:34] Like, people think like, oh, you decided to raise funding or you decided to stay bootstrapped, and that was a moment in time decision. It’s like, well, no, actually, you can, you can cross… It’s very easy to w- relatively between the market and a bunch of us to go from bootstrapped to venture-backed, assuming you have traction and all of that.

[00:19:53] And so at any point, you know, if you stay bootstrapped, you’re, you’re preserving this optionality. Now, if you then don’t If you’re not able to grow, then you lose that optionality pretty quickly ’cause no one wants to fund a, a flat business. But then once you go to the, to the other side and you raise funding, it’s very hard to go back.

[00:20:08] Now, there are companies, uh, you think about Zapier, um, you know, people… They’re a venture-backed business. I think they raised a couple million to get to a few hundred million in revenue . So it’s like-

[00:20:20] Ankur: And then they raised a few hundred million.

[00:20:21] Nathan: And then they raised a few hundred million. Yeah.

[00:20:23] Ankur: E- even Hotmart was very similar.

[00:20:25] They raised 400K, and then 10 years later they raised 100 million. Yeah. Like it’s… I, I will say if you are raising money too, within the spectrum of raising money, how much you raise is very important. The only reason I was able to sell Carry in this kind of deal and everyone still did somewhat well is because we didn’t raise that much, and it almost was in that way.

[00:20:47] There was a time when we were doing about 300K in ARR, a very large, very prestigious firm offered us $40 million Ah, we were looking to raise, like, five.

[00:20:58] Nathan: Right.

[00:20:58] Ankur: And the worst part is we were tempted. We thought about it pretty hard. And just to be

[00:21:01] Nathan: clear, that, that was $40 million, uh- Of

[00:21:03] Ankur: funding …

[00:21:03] Nathan: of funding

[00:21:04] Ankur: at- They wanted a third of the company.

[00:21:06] They wanted to… It was a big, big growth fund. They wanted to deploy a lot of capital.

[00:21:09] Nathan: Right.

[00:21:10] Ankur: And we were tempted. I thought about it. I talked to the team. The team honestly was more for it, but I ultimately decided against it for two reasons. One is it makes an entire spectrum of, like, okay outcomes bad.

[00:21:25] Like, I wouldn’t… Like, this deal would not have happened. And two, I just didn’t trust we wouldn’t do dumb shit with it. Like, we probably would’ve, you know, made stupid decisions. Right. Um, but that makes a big difference because, again, we sold this business at 76. The reason 76 was psychologically important, you may be like, “Why aren’t you saying 75?”

[00:21:43] It’s because 75 was the valuation of our last round, so we wanted to at least nominally clear it for it to feel like a sm- at least a small win, even if nominal for everyone involved.

[00:21:54] Nathan: Right. Yeah, that makes sense. And especially in, in a lot of these, um, a lot of these different markets, this happened a lot in 2021, where people raised amounts of funding that limited their options in a huge way, and, and the, the idea was that more funding is always better, and it’s just, it’s not the case.

[00:22:14] So I have a huge amount of respect when I see founders who you know in a hot market can, can raise a ton of money, and then you see them do these very strategic rounds where they’re like, “Oh, I actually only need $2 million or $6 million to get to the next stage.”

[00:22:28] Ankur: Yep. A lot of people don’t know that almost every time you raise venture capital, you have to pay it off before anyone sees a dollar.

[00:22:36] So there’s a lot of companies now that have raised $200, $300 million. If they sell for less than that, like, unless the deal is restructured, no one makes anything. Investors always get their money back- Yeah … before anyone sees anything. Yeah. So large rounds can really, really change, uh, the math when you exit your business.

[00:22:54] Nathan: Yeah. Okay, so since you’ve built two businesses, you have the advantage of, uh, being able to start from scratch on round two. What are some of the biggest things that you did differently in round two versus round one of building the company?

[00:23:06] Ankur: It’s funny, ’cause round one overall went better, so I don’t know how, how useful, useful the lessons are.

[00:23:12] Um, but round… With round two, we were able to Hire good people much faster. A lot of the things that first-time founders really struggle with or spend a lot of time on become very easy as a second-time founder. Like fundraising is very easy, hiring people is very easy. Um, all these things become much easier.

[00:23:35] The thing that doesn’t materially become easier is how hard it is to find true product market fit. If anything, it’s… You almost have to filter out the bullshit because if people think you’re a founder that’s been successful before, they will be nicer to you than they otherwise would. So everyone tells you really nice things, and you have to kind of filter out that bullshit.

[00:23:55] Um, yeah, there’s a really nice, good quote I liked where I’m like The best way to play being a second-time founder is if you can use the hype to your advantage without believing it yourself. Um, because you will be more hyped up, yet the hard things continue to remain the hard things.

[00:24:13] Nathan: Yeah, and you feel like you should be making progress faster because you’ve learned all these other skills, and, and maybe you will.

[00:24:19] Like, fundraising might go faster, um, the first few customers and all that. But product market fit might not go faster at all, and it might even take longer if people are lying to you, like, “Oh, Ankur, like, great idea. I cannot wait to do this.” And you’re like, “Great. Will you pay for it?” They’re like, “Well, I don’t know.”

[00:24:34] Ankur: And, and I… And at some level, you, you and other people put more pressure on you. Like, everyone who joined the team joined the team because they’re like, “Okay, this guy succeeded with his last company. This is my, like, ticket to success as well.” And yeah, and then the first time, everyone almost expects you to fail.

[00:24:55] The second time, you’re expected to succeed in a way that you’re like, okay, like, you know, I’ve been on panels talking about building a successful company. It’s kind of embarrassing if this goes poorly after telling other people what they should be doing. So yeah, there are, you know, pros and cons.

[00:25:08] Nathan: Yeah, is there anything now as you look back over two companies and two exits where you’re like, okay, if I were doing round three, uh, and it was a, it was a company rather than a fund, uh, that you’d focus on or that you would do differently?

[00:25:20] Ankur: So I generally believe in order to get good at something, you need so many repetitions, and like an N of two, N of three is still not that many where you generalize. But one of the things I think I would think long and hard on is, again, like, how you fund the business affects so much of the strategy. So pretty early on, make a very clear line of like how big do I want this business to make and accordingly fund it.

[00:25:50] Like, with Carry, it was sort of in between, um, versus like, okay, if you have something that is and can truly, truly be venture scale, go and actually build that or fully retain optionality.

[00:26:02] Nathan: Okay. That makes sense. I wanna go to questions from all of you who have joined us in just a second. Um, but before we do that, I’m…

[00:26:09] So think about the question that you wanna ask. Uh, Daniel on our team is gonna have, uh, a mic to pass around. As you think about going into running a fund from here, like that’s a… You’ve done a lot of angel investing, so you’re familiar with that side. But what are the, like, the biggest skills you think you have to learn, you know, the, um, and ways you need to level up individually to, like, tackle this next stage?

[00:26:30] Ankur: So in between Teachable and Carry, I ran couple of venture funds, so I have a lit- little bit of experience there. What drew me to this role at USVC is It’s running a fund, but we’re kind of building the whole thing, ’cause it’s a public venture fund. It’s a very different type of product. Like, there’s a whole product aspect to it as well.

[00:26:51] Um, the challenges with it are it’s, you know, it’s a very, very hot time to invest in private companies, and-

[00:26:59] Nathan: Okay, let’s talk about that for a second. Um, I think that HubSpot at this moment has, like, a three times ARR multiple, maybe, maybe less.

[00:27:07] Ankur: Uh- That SpaceX is going public at 2 trillion with, like- … tens of billions in revenue.

[00:27:12] Nathan: Yeah.

[00:27:12] Ankur: Um-

[00:27:13] Nathan: Shopify put up, like, an insane Q1, and the whole market’s like, “Eh, I don’t know. We don’t care.”

[00:27:18] Ankur: Yeah. It’s, it’s definitely… Running a, you know, running a public venture fund now, these are things that are quite important and quite significant to us. But the way we’re doing this is we’re not simply making this a vehicle to index the later stage names.

[00:27:32] Like, there’s… Like, if you pay attention to private markets, there’s so much capital now in OpenAI, Anthropic, SpaceX. We’re taking a longer term strategy where because we provide liquidity every quarter, we will have some exposure there, but also investing in the early stage fund managers and, and things that will pay off, you know, one, three, five, seven years in the future.

[00:27:54] Um, the general thesis we have is- Every single year, more new companies will be started that will be more valuable than all the companies started before. And building our fund with a, with a way that, you know, if you believe that thesis, this is a vehicle to bet on that.

[00:28:10] Nathan: Yeah, that makes sense. Okay, was there anything that you’re like, “Ooh, I’m gonna have to figure out this part in particular,” or it’s gonna be, be difficult to

[00:28:17] Ankur: implement?

[00:28:17] The, uh, the part that, the part that we’re still figuring out is it’s … There’s a lot of ways I can get myself, get myself into trouble from a regulatory perspective that I’m discovering, since this is now a public security. Right. And yeah, I, I’m gonna try my best not accidentally go to jail. I think that’s probably a good, good priority.

[00:28:34] Audience member: That seems like a good goal. Yeah.

[00:28:36] Nathan: All right, who has a question they wanna kick us off

[00:28:38] Audience member: with? Thanks, guys. That was awesome. Um, Ankur, this is for you. So you mentioned it was way easier on your second company to recruit people, to hire great people. I think that’s the core to any business, is the team. What was most effective in pitching them to come over?

[00:28:53] Because it’s a combination of vision, incentives, you as their boss. Like, what, what did you find was kind of most effective to attract great talent?

[00:29:01] Ankur: I think there’s two dimensions that helped a lot. One was top of funnel. Um, having an audience was very, very helpful. I was able, I don’t know, I tweeted I’m starting a new company, and there were, you know, almost a million impressions on that.

[00:29:14] You know, tons and tons of DMs. And so top of funnel became substantially easier. I went to a bunch of people and I, you know, told them, “Who’s the best person you know for this?” And then when it came down to closing them as well, the strategy we picked is like early on, pick a strong founding team, um, and be f- very generous with equity to the first, like, five or seven people, um, in a way that I didn’t, did not when I started the company.

[00:29:40] I did not have a co-founder that had an equal amount of equity as I did. As a result, I could be very generous with the first five people. Um, so the combination of both those things made early hiring, you know, substantially easier than the first time around. Um, and even then, every time we did have a role, hiring only got hard when we needed, like, specialists when we were further along.

[00:30:02] Like a head of engineering is still hard when you’re, you know, two, three, four years in, but the entire founding team hiring was, was quite easy.

[00:30:08] Nathan: Recruiting is so, so important. A couple things that worked well for us, um, being a distributed team made it easier, and I know there’s so many benefits to being in person in one office.

[00:30:19] We’ve talked about that as a c- as a Kit team. Like, oh, if the Kit exec team was all in one room, you know? And it’s like, okay, well, who’s moving? ‘Cause we’re in New York and Charleston and Boise and like, um, you know, all over. So but being a remote team, you can pull from, uh, so many places. Exactly as you said, like having a personal brand or a reputation, um, is so important.

[00:30:40] It, it helps so much. Like if that’s going to be- We can debate how useful it is at a small scale for acquiring customers, but it’s very useful for acquiring talent. Even if it just gives people an opportunity to say like, “Oh, um, who is this person that I’m about to interview with?” Or, “I’m thinking about taking this job.

[00:30:57] Let me go scroll through their LinkedIn posts and all of that, and see the content and get a feel for who they are, and who they’ve been over the last, like, three to five years.” This is someone who’s shown up consistently online for a while. Another thing that, that really helps is in direct outreach, the thing that I do, is I go to everyone that I would want to work on my team and I say, “Hey, here’s the, here’s the job that I put together.

[00:31:18] I wrote it up. Um, do you know anyone who would be a great fit for this?” ‘Cause there’s some people where, like, they’re doing such important or prestigious work or whatever that you don’t… You know, and your company is so small that, uh, you’re kinda awkward about like, “Do you want this job?” And they’re like, “No, it pays a quarter of what…”

[00:31:36] You know, like, that there’s an interaction there that could be awkward. But if you say, “Hey, I think of you as a legend in this space. You must know other people like you. Who, um, who would be a great fit for this?” And they’ll often say, like, “Oh, let me think about it.” And then some, you know… So say 70% says, “I’ll think about it and let you know.”

[00:31:52] 20% or 30 or, you know, 28% say, uh, “Oh yeah, here’s someone that would be a good fit.” And then a small fraction go Actually, I’d be interested in that. And it’s such a great lead-in to the conversation without any of that, uh, that awkwardness.

[00:32:07] Ankur: A great way of doing this also is to appeal to people’s ego, right?

[00:32:10] Just post who’s the best person you know at growing a YouTube channel, and now you’ll start seeing people nominate themselves- They can nominate themselves. … other people nominate. Yeah. And then now you have a list of prospects that you can go reach out to.

[00:32:21] Nathan: Yeah, it would be crowdsour- crowdsourcing and playing to ego is a good one.

[00:32:24] Yeah.

[00:32:24] Audience member: I’m curious to hear for, from both of you on this question. What are some contrarian beliefs or, like, hot takes that you hold that helped you get to where you are?

[00:32:34] Nathan: I’ll go with one. Um, I pay people the same amount globally, uh, independent of where they live or their local cost of living. And so we have team members who we’ve hired in Poland and other places who have shaped the entire company and are thrilled because they make…

[00:32:54] Like w- someone told me that when he, when he joined Kit, he tripled his salary, and he makes even more than that now. And he has shaped our entire product in a massive way. And so we have a globally distributed team. We hire from everywhere, and we don’t get any of the economic advantages of doing that. Um-

[00:33:11] Ankur: That sounds like it’ll be hard to recruit people from New York and San Francisco then.

[00:33:14] Nathan: Um, I mean, I have… What do I have? 11 people in New York.

[00:33:18] Ankur: Okay.

[00:33:18] Nathan: Um, and a decent number. We, we pay-

[00:33:20] Ankur: So yeah, you basically- We pay quite a- … pay New York salaries to everyone.

[00:33:23] Nathan: Yeah. And, and it is hard, right? Yeah. Um, to some extent, but we have, uh, we have team members who go above and beyond in a massive way because the- they’re so thrilled to be a part of the team.

[00:33:35] Um, I would- wouldn’t necessarily recommend it for everyone. It’s just a personal philosophy that I have. It’s a contrarian take, and, uh, it’s paid off very well for me. What’s one of yours?

[00:33:43] Ankur: Don’t talk to or listen to your friends when starting a company. Um, I find friend feedback to be anywhere from useless to actively damaging They’re going to be nice to you.

[00:33:56] They typically don’t really have an understanding of, of how hard things are. They’ll say all the positive things. I also think when you’re starting something, like, just doing shit is a better way of going about it. Um, build something, send a link, see if someone buys. That kind of activity is much better at testing an idea.

[00:34:14] What I’ve seen a lot of people doing is they’ll go grab coffee. They’ll, they’ll sit down with 5 people, 10 people, 20 people, and this is bad because, one, you don’t get useful feedback. Two, it feels like work. Because it feels like work, you’ll do more and more of it, and you’ll be like, “Wow, I’ve spent a month kind of working on my idea,” but you actually haven’t done much.

[00:34:32] So I tend to think it’s better to just work on things, try things, and see what happens.

[00:34:37] Nathan: Yeah, it’s, uh, it’s performative, uh, work, and it’s just performative to yourself. It’s, it’s really not, not helpful. Uh, we’ll go to another question and I’ll think of more hot takes ’cause this could be a good segment that we do.

[00:34:47] We’ll go here and then, uh, up to the front after that.

[00:34:49] Audience member: Great talk, guys. Well done. Um, I was gonna ask, what are you seeing working well for some GTM strategies? So what are you seeing that’s probably not working anymore over the last 10 years? What’s working now?

[00:34:59] Nathan: Okay, you g- got me onto a hot take. My least favorite startup and business advice is, especially, and this is the worst because it sounds smart and it’s not.

[00:35:09] What got you here won’t get you there. And people say that because they, they do these things. They’re like, “Okay, when we got our first 10 customers, now we need to do something different,” and, and on from there. Um, ’cause the, the… this advice is both true and false simultaneously. Like, it’s true 50% of the time and it’s wrong 50% of the time, which means it’s useless ’cause you don’t know which half.

[00:35:29] So something that works really well still, I believe, in go to market is direct sales And that’s something, you know, that’s basically how Kay got our first, uh, 20,000 ARR for sure. The, uh, uh, sorry, 20,000 MRR that then scaled into 100,000 and beyond, and then we stopped doing it because, like, oh, no, we’re a grown-up company and we do scalable important things.

[00:35:52] And we should’ve kept doing that all the way along because turns out direct sales gets easier. You have brand reputation. You can name-drop your customers. The, the trust comes. You know, like, you can build network effects. You can systematize your outreach and your closing funnels and y- you know, all of this stuff.

[00:36:06] Ankur: Are you still doing webinars, Nathan? I’ve been doing webinars for 10 years straight, and I fucking hate it. But it works.

[00:36:12] Nathan: Um, I am no longer teaching the webinars. Uh, but yeah, we’re, we do, you know, two to four a week. Um, so that was another one for us that we stopped doing webinars because we’re like, oh, we’re onto the next thing.

[00:36:22] Like, uh, grown-up companies should, you know, do paid acq- acquisition funnels or, you know, that sort of thing. Often what got you here done better is gonna be the thing to get you there. And now my approach is very much around what’s the flywheel that I can build where I can do the same thing over and over again, systematize it, and make it 1% better in each iteration, um, and, and go from there.

[00:36:44] So as far as what I’m seeing work really well in go-to-market, direct sales still works. You know, go recruit top customers. Your sights move higher up. You know, years ago I was reaching out to, um, individual creators or Pat Flynn or, you know, people on that scale, and now our direct outreach is turning into people like Tom Brady and Emma Grede and, um, you know, on a different scale ’cause that’s just where we’re playing now.

[00:37:08] Um-

[00:37:08] Ankur: How do you direct outreach to Tom Brady?

[00:37:10] Nathan: You figure out who the right… So it, it’s the right-hand man principle You figure out who are the behind the scenes people that actually call the shots. Everyone’s trying to get like, “Oh, if I could just get three seconds of time of the right person, how do I position my…”

[00:37:23] And it’s like, what are you doing? They’re not the decision maker. They don’t, they don’t care. And so this would be a good example of, um, how we got Tim Ferriss on the platform years ago, it’s probably 2017, is I figured out, okay, who actually calls all the shots behind the scenes? Who’s the producer of the podcast?

[00:37:36] Who’s running the brand and all of that? Where do they live? Who can introdu- introduce me to them? Turns out getting the introduction to the person whose job it is to look at opportunities and filter through them, like it’s way easier to get in front of them because the last thing they want is the person they work for, um, coming to them later and be like, “Wait, you had this opportunity and you didn’t show it to me?”

[00:37:54] You know? So they’re gonna look intently like, is this something we should look at? Uh, and then go meet them in person. Um, I’ve had a bunch of times in my life where people have said like, “Hey, if you’re ever in New York, like yeah, let’s meet up.” And I was, “Great, if I’m ever in New York or in Boulder or wherever, you know, I’ll, I’ll do that.”

[00:38:08] And it’s like, no, no, no, that is the reason. You’re like, “Oh, funny enough, I’m gonna be in Boulder next week.” You know? And they… How is Monday at 4:00 sound? You know? Or, um, that kind of thing. That,

[00:38:18] Ankur: that’s exactly how we signed Pat Flynn to our platform. I, I told Pat I would be at trying to… One of the podcast conferences or something, and as soon as he replied, I booked my ticket and flew in- Yeah

[00:38:29] just for that meeting. And yeah, then he signed up and became an advisor and our biggest affiliate.

[00:38:34] Nathan: There’s an interesting filter on this kind of thing where cold outreach that’s an e- like an email, especially now, it’s even easier to send decent cold outreach, AI written at scale, right? And so our filters are higher.

[00:38:46] But if you say something like, “Hey, I’m gonna be at this event, um, you know, before or after your talk, I’d love to grab 20 minutes to ca- to catch up”, or you know, that type of thing ends up working really well, but you don’t actually have to already have the ticket to the event or already be going. You can line up the meetings, and if they’re not good enough, you’re like, “Oh, shoot, I, I couldn’t, couldn’t make it.”

[00:39:07] Or if you get the meetings, then you’re like, “Great, I’m going.” Um, so yeah, uh, I love the, the unscalable things that then you can systematize and do over and over again for go-to-market. What are you seeing works in go-to-market?

[00:39:18] Ankur: It’s crazy to me this still wor- this works because it’s the most obvious thing.

[00:39:22] Nathan: What a, what a hook. Uh.

[00:39:24] Ankur: I’ve been, I’ve been creating content too long. But I’ve, I’ve had really good success. I turned this off about a month ago, but before that, I had very good success with full AI content creation on channels I didn’t care about. So Twitter I care a lot about. I don’t want Claude writing, writing it for me.

[00:39:43] LinkedIn and Threads I don’t really care about that much. So I trained it, gave it keys to the kingdom, and you would think, you would think it would just be a bunch of slop, but it actually for both platforms gave me my best month ever as long as it was like, one, correctly trained, um, which meant giving it a lot of training on stuff I had actually done, things that worked, and then creating some kind of reinforcement loop where it stored every post and the performance.

[00:40:10] It would look at it, evaluate what worked, and kind of rewrite it. Um, I turned both of those on and it still works, and a lot of the accounts that are doing it well, you don’t even realize it. But a lot of this is automated. Um, the one caveat is you have to be o- like, some weird shit happened and I had to be okay with it.

[00:40:28] Like, it posted on my LinkedIn saying, “Life growing up in India.” I did not grow up in India. This was, this was, this was… Yeah. Uh, but it also replied to a bunch of people on LinkedIn saying shit I wouldn’t have. So there were small downsides. So I wouldn’t, I wouldn’t use it on platforms I care a lot about, but if your idea is you wanna grow and you don’t mind being a bit cringe or whatever, um, the right training still works, and I think there’s probably a brief window of time before we’re fully flooded with it, but I’m sup- I, I thought it already wouldn’t work.

[00:40:58] Nathan: And so if you were to execute on that, it’s giving it the library of content, either the huge back catalog that, that you have over time, um, or You could do like full context dumps in- into it where you could potentially for, you know, every day for three weeks straight, you could be recording voice memos on a walk, you know, as you’re walking the streets of New York or walking to the gym or whatever, dump that in there, and then- Yep

[00:41:23] it would feed off that.

[00:41:24] Ankur: The two things that made it work that wouldn’t otherwise are, one, like the fact that it could kind of learn how I wrote. Because otherwise you, you know, it, it reads like the standard AI sloppy read, but that’s only because you haven’t taught it how you write. Um, and the second thing is like just breaking down the anatomy of like what makes the post work.

[00:41:43] Like, oh, this is a hook. This is like a call to action, and kind of either saving that as a skill or something.

[00:41:49] Nathan: Yep. Um, and if you specifically have it brainstorm a bunch of different hooks off of an idea you give it, and you, you can select one and, and that makes a big difference. But especially don’t say like, “Write this entire thing.”

[00:42:02] If you say, “Write 10 hooks for this,” have it flow into this other one. The thing I would say is, um, there’s a markdown file, uh, called Tropes. I think it’s at tropes.fyi, and if you go download… It’s just all the common AI writing tropes that we all see and hate. And, uh, you can load that into your project, and then in any writing it’ll be like, oh, let’s not do the It’s not this but that, you know, or those common things

[00:42:26] Ankur: Also, it’s kind of bad, but repetition works.

[00:42:28] Like, if you have something that really works well, you can chop it up in different pieces for the rest of your life. I mean, again, I, I love Justin Walsh, but you read his content, it’s like, uh, he… The same thing dissected down slightly differently over and over, um, and you can apply that to anything.

[00:42:45] Audience member: Yep.

[00:42:45] Nathan: Okay, who’s got the next question?

[00:42:47] Audience member: I want to ask you, uh, knowing that, uh, when you build something in the morning, that, uh, the AI is evaluating so fast that the afternoon what you built has already been passed, and knowing that the VO is there, Lovable, Grok build, whatever the systems are available right now to build.

[00:43:06] So I wanted to have your point of view as investor, how you’re able to manage now, uh, the way that you’re going to invest in a company, knowing that it’s pretty easy to build something now on the side of the software.

[00:43:19] Ankur: To me, that’s a good thing because now we should be able to build dramatically better and more delightful things, right?

[00:43:27] Like, if all you’re building is, like, form entry or whatever, sure. But because we now have AI, I think there’s an opportunity to build, like, insane things that just could not be built before. Uh, but I do think, again, if you are going the route of venture capital, every investor is going to ask, you know, “What happens with AI?

[00:43:48] Does this become better or worse?” And if it doesn’t really go anywhere, things get much, much harder. Um, I’d love to hear Nathan’s answer to this question, since you’re… I mean, you see, again, we’re talking about HubSpot stock, and, you know- Right … there’s a whole con-

[00:44:00] Nathan: Yeah, I think, I think that we’ll learn over the next year or so which companies, I was, I was gonna say, have durable moats.

[00:44:07] Uh, I do think that there’s not much… Like, what’s a moat when the ocean… Like, what’s a moat in the middle of the ocean? It’s not really a, a, a thing. Um, I, I do think the valuations will come back as we see, um, or, or for types of companies, as, as we see what ends up being, um, being durable. Before you had to…

[00:44:28] Like, the person who had the idea and the person who had the skills to execute on the idea either had to be convinced that, to work together or, uh, be one employed by the other or something like that. Now, in more and more cases, that can be the exact same person, and you can go through so many iterations, and you can be like, “Oh, wouldn’t it be cool if this…”

[00:44:49] And then you, you know, speak it into existence. And you’re like, “Oh, actually that wasn’t as good as I thought,” or, “This is way better than I thought.” And so I think it’s really exciting that, um- Having ideas you can execute on them, you know, yourself now without needing someone else, at least for those early versions.

[00:45:07] Um, I think, so I, I think it’ll result in much better software products, much better platforms. Um, I do think that the speed of execution matters more than it ever has. It, it was the most important thing before, and it’s probably 10 times as important. Um, and so you have to, like whatever used to be a quarterly and then a monthly iteration cycle is probably a weekly cycle, and we should expect that to shorten further.

[00:45:35] My least favorite phrase is, uh, “By the end of the.” ‘Cause it’s just like a made up thing in business. Like, “Oh yeah, I’ll have that to you by the end of the week. Uh, you know, I think if we finish that by the end of the quarter, that’d be good.” I was like, why is June 30th the date that that… You know? Like, and so it just mean- it’s, it’s a signal inside of your company that someone did not think that through, and they just chose a convenient thing instead of thinking like, “Okay, that’s probably gonna take 36 hours, so yeah, no, we can have that by Wednesday at noon.”

[00:46:06] Yeah.

[00:46:07] Ankur: Can someone clip this video and whenever Nathan, someone says that in the ConvertKit Slack, it’s just a video of- … going under red.

[00:46:13] Nathan: There’s an agent-

[00:46:14] Ankur: It means you did not think it through.

[00:46:16] Nathan: There’s just an agent. Yeah. The best thing is I would probably say it, and then it’ll just reply to me. Um, I think, uh, who- Yeah, right there.

[00:46:24] You have a question?

[00:46:25] Audience member: Yeah. So one of the big things is like urgency, right? Like, for both of you, like in the companies you’ve built, like, like being able to move as quickly as possible to like solve the problem, because again, as the previous person said, like building is also easier. So getting to your first customers, building that sort of relationship, and building that mo- is more important than ever.

[00:46:43] So in that context, how do you guys, like what are your like first principles to stay focused in urgency? Because like everybody talks about moving fast, but I feel like sometimes you don’t necessarily know exactly what to do, but you want to do. If that makes sense. So like what are like the sort of north stars you sort of set to keep yourself like aligned?

[00:47:01] Ankur: Every business I’ve had has had like metrics we deeply cared about, so there was always the urgency still in some way, shape, or form had to kind of make sense for those metrics, and that always kind of focused us back. So for Carry, it’s like, okay, did this add customers or increase assets on platform?

[00:47:19] And if not, was it a building block to either of those things? Otherwise, like why are we doing it? Um, and that did help. I still personally believe, yes, there are downsides of like manic urgency or whatever, but speed of iteration is one of the only sort of controllable inputs that meaningfully changes the probability for success.

[00:47:41] So I’ll st- I’ll take the trade-off of someone doing like stupid shit fast versus the whole, you know, measure twice, uh, cut once approach. Um, but part of that is that’s the nature of how I like to work. There are founders who are the opposite, you know, very methodical, four years to launch a product. That can work for people, it was just not my specific style.

[00:48:03] Nathan: You have to be right for that, that ’cause you, you have so fewer, so many fewer, uh, chances for iteration. Uh, but I think that level of urgency is just towards a specific outcome. So you have to paint a picture of what the future looks like because you need to rally people Towards that outcome. You need a work back plan of how we’re going to get there and, uh, the metrics that you’re going to look at along the way.

[00:48:27] Um, but even the… You know, there’s little things like, uh, we have a new COO who just came into Kit, and he was like, “Hey, we’re, we’re evaluating our revenue and our growth numbers too infrequently.” I’m like, “We’re doing it every week.” He’s like, “No. Watch. Here’s how you calculate it on a daily basis, and here’s the outcomes.

[00:48:40] Here’s how it’ll shift the mindset for the team.” And I’m like, “Great. Okay. Let’s, let’s see that.” Um, but it really comes back to paint the vision for where we’re trying to go so we all understand that collectively. What are the metrics we’re going to use to track that? And then a work back plan. And then when you have that, then just absolutely as fast as possible.

[00:48:58] Did you have a question back here?

[00:49:00] Audience member: Yeah, I was gonna ask about you guys’ content workflows. I mean, you’re both super busy guys, but also prolific creators. So I’m just curious how you kind of balance those two things.

[00:49:09] Nathan: Content workflows. Do you wanna go first?

[00:49:11] Ankur: So I was actually just having this conversation.

[00:49:14] I, I realize I don’t like creating content for the sport of it. Maybe some people actually like it. I kinda don’t. And when, now that I’m no longer running Carry, where part of it was creating content, like you’ll see my content has dropped off 80 to 90%. Um, which was interesting, ’cause there are some people who do it truly for the love of the game.

[00:49:33] May- maybe you do. But I realize for me, content’s, it’s relatively speaking not a bad way to grow a business, and I like doing it for that reason. It can be fun in pieces. But I’m not a content creator at heart where I, I love this shit. Um, Twitter, I still like sometimes, you know, posting stupid things. But other content always takes a lot of effort for me, so my goal has been automate as much of it as possible, either with AI or have someone kinda do a lot of it for me.

[00:50:01] It’s just not what I found to be the thing that gives me joy.

[00:50:04] Audience member: When, when you were though, ’cause research and strategy is obviously a big part of content that actually performs, like did you, did that take a lot of your time?

[00:50:12] Ankur: Research and strategy was not a big thing for me. What, what helped a lot, at least with the content I did, which worked a lot of it, which was around personal finance, is a lot of this I was kind of learning myself.

[00:50:24] So every time I discovered something that legitimately I found surprising or, um, I did not know about, that I would share that, and that created a really nice reinforcement loop. Like, I was learning about a topic and I could share that, and that in turn found other people who were doing that. But I never went down the process of, okay, let me research popular topic, or popular videos in this topic or whatever.

[00:50:47] But then again, the channels that grew for me were all the text-based channels, which is very different. I never… I bet if I had to do a YouTube, that’s what the strategy would look like.

[00:50:56] Nathan: Yeah, I think that chasing what you’re interested in helps a ton. Um, we often have this idea that we need to be an expert before we can, you know, share from there.

[00:51:07] But often, like the most interesting things are what we just learned, and th- ’cause that excitement comes through, you know? Mm-hmm. When, when Ankur’s like, “Okay, I learned all the details of QSBS, let me write it up.” And people are like, “Wait, how do you know that?” And then they ask questions and, and it’s fresh.

[00:51:21] The other thing is, you know, we say like basically because someone teaches, we perceive them as an expert. And so- I would take the thing that you’re learning, the thing that you’re most excited about, and I would create content around that, and I would do it in real time, even if, um, you’re wrong about it.

[00:51:37] Or not wrong about it, even if you’re early on with it. So like, for example, I was learning to code in Ruby on Rails. This is like 20- uh, 2012, 2013. And I was getting stuck on the most basic things, and I would read these tutorials written by the experts who had contributed to the programming languages and everything else, and th- their tutorials, I w- I was getting stuck on things that weren’t covered.

[00:51:57] And then I came across a blog by someone who was, like, six months ahead in the journey than me, and they were writing stuff about like, “Oh, yeah, the total beginner gets stuck on this.” That everyone else was expert like, “How could, how could you be that dumb to get stuck?” And I was like, “Well, I was.” And so following someone who was just ahead of me in the journey ended up being the most useful thing.

[00:52:16] And so I try to pay that forward of sharing what’s fresh, what’s exciting, um, ’cause it often ends up being the most useful. But your question about workflows, just to talk about it. So, um, I, the last, like, year or so have made a big investment in building up my personal brand, and, you know, as a creator first and then kinda went behind the scenes, just heads down running the software company, and then now I’ve, um, brought back the, the content side of things, uh, ’cause I believe so much in the leverage of it.

[00:52:44] Um, but this time I’ve done it with a team. So, um, w- I have Chelsea, who’s here on my team, uh, in the back there, uh, who runs the… like, all of the operations for my personal brand as well as the Kit exec team. Um, and then she has reporting to her a head of content and head of social media. And so then they both are helping to pull ideas that I’ve shared, uh, help me re-record it.

[00:53:09] You know, it’s like, “Hey, this thing that you said in a podcast, like, there’s something there. Let’s write a newsletter about it. Let’s, um, uh, let’s re-record an Instagram Reel about that.” You know, maybe something that I fumbled over live, they’re like- There’s something good there. Let’s just ask you a question and give the crisp version that that will work as a, um, as a reel.

[00:53:27] And then we also work with a couple agencies. So, um, there’s an agency that does all of our podcast editing and, and clips. Uh, they’re called 7X Content out of the UK. Uh, and there’s another one called Ampersand Studios, uh, that we work with, uh, out in Boise, that they’ll come up with content ideas. Uh, and they’ll say like, “Hey, why don’t you, you know, create a reel or a post about this?”

[00:53:50] Uh, but really the podcast is at the core of everything that I do, um, or any time that I’m talking. And so the team is really good at mining when I say something interesting, and then deciding, okay, is that packaged well enough that it can be posted? Or is that interesting thing, could it be repackaged?

[00:54:08] Could we get you to say it again in a different format or with a better hook that then it’s worth posting? And so the ideas come first, and then we go, um, down from there, and that’s where the team can really help. Versus what a lot of people do, where they outsource the ideas and everything else, and it’s like you’re just another talking head on the internet.

[00:54:26] Ankur: I’m excited to see the real version of how EOD means you’ve not thought it through. So

[00:54:31] Nathan: looking forward to that. Yeah, exactly. See how that plays out. Um, who else has a question? I think we have time for… Let’s do two more. So we’ll go here and then back over to here.

[00:54:39] Audience member: Hey, guys. Uh, thanks for doing this talk today.

[00:54:42] Uh, I had a little bit more of a specific question. I know you guys mentioned you have a strong background in angel investing. Uh, so a few f- friends of mine, uh, and me are building an alumni angel network actually for our school, Rutgers. Um, but Rutgers doesn’t traditionally have a background of like, uh, startup operators or, um, I guess investors or people that go into that route compared to like Harvard or Stanford or other Ivy Leagues.

[00:55:05] So I was gonna ask from a background like yours, what would you suggest that, um… Or like strategies that we should use to try to build that, considering that it’s like a more of an emerging ecosystem now?

[00:55:16] Nathan: Well, first I was gonna say angel listing or angel investing is something that, uh, I thought would be really cool and fun, um- I don’t enjoy it at all, and I don’t enjoy the g- the, the K-1s that come back from it and everything else.

[00:55:29] So that was something that, you know, my hot take is I don’t like angel investing and, um, and I don’t know, I did 10 or 12 or something like that. Made some really good money on some of them, but I was like, “Oh, wait, I don’t… Just because everyone else does this as a founder, I don’t need to do that.” And it’s so freeing to be like, “Oh, yeah, no, I don’t, don’t do angel investing.”

[00:55:46] But you have a different take. I was,

[00:55:47] Ankur: I was gonna challenge the other assumption. Yeah. Um, well, yeah, I always say angel investing is, like, the most expensive newsletter subscription in the world, right? Like, phew. But, um- Yeah,

[00:55:56] Nathan: how to, how to lose money $25,000 at a time.

[00:55:58] Ankur: Yeah. I guess I would ch- I, I… Yeah, I would just challenge your assumption a little bit.

[00:56:03] Like, what, what about it makes you think there’s, like, network effects of tying it to a specific university? Like, is it the fact that… Like, what, is it the fact that, um, you’re gonna invest in other Rutgers founders? Or, like, why, why tie it to the university, I guess? I

[00:56:19] Audience member: guess the assumption was that, uh, you know, we wanted to build that ecosystem up within Rutgers, like, to build a brand image, and to kind of pay it back, pay it forward to, you know, where we came from, that kind of thing.

[00:56:29] Ankur: Got it. Um-

[00:56:30] Audience member: Because, like, for context, like, we built our, um, like, our Rutgers Entrepreneur Society, like, our club from the ground up, as well as, you know, a few other programs that are all, like, that coincide with each other. And so, like, passing that on to the next generation kind of thing, building it over n- or over time.

[00:56:47] Ankur: Got it. Makes sense. Um, so I think with, with angel investing, my general sort of guidance to people is it can be, it can be profitable, it can be fun. However, it’s a sort of thing that if you wanna do it, you wanna take many shots on goal. Um, it’s like, whatever budget people start out with, like, divide it into at least 20 little slugs because each…

[00:57:10] Like, as an aggregate, this model works because one company is an outsized success, and the only way to have any kind of predictability around it is to have a large sample size, um, of companies. Now, if I were to think about what I could do to grow this investment club, I think, I think it’s do you, do you get access to a lot of interesting deals?

[00:57:32] Like, any of these investment clubs really work when you have one thing truly kind of work, and then that becomes, becomes the example. So I would turn that back to you. Are there, I don’t know, very successful companies started by Rut- Rutgers alumni or something, and use that to kind of bring people in?

[00:57:48] Audience member: Mm.

[00:57:49] Got it. I mean, yeah, there are a few. Like Bloomberg, for example, one of the founders of Bloomberg was a Rutgers alumni. But I guess what we’ve noticed is that a lot of, uh, founders who have previously been from Rutgers, or founders, investors, whatever, they tend to kind of levera- or they, when they move up to a higher brand, I guess, for example, like their company or, uh, let’s say an MBA or something like that, they tend to, you know, drop the Rutgers, uh, affiliation per se.

[00:58:13] Ankur: Yeah, that would, that would be kind of be the challenge I would think as well. Like, I went to Cal Berkeley. I have… My school pride extends to sports, not beyond. Like, I don’t, I don’t like… Yeah, I watch the football team, I watch the basketball team, but I don’t feel super strongly or connected to, like, a very large state school with tens of thousands of people, and, um, that I picked because I didn’t get into Stanford.

[00:58:34] So I don’t, you know, I don’t, I don’t have super strong affiliation.

[00:58:38] Nathan: I would say, uh, think really clearly about the problem that you’re trying to solve. Sometimes we get excited about our particular solution, you know, like, oh, we’re going to use technology to network, you know, the angels in, in this community or whatever else.

[00:58:50] But it might be if you’re… If reputation is what you’re solving for, there might be better ways to… Like, storytelling of the companies that have come out from Rutgers alumni or something like that might be a much better way to accomplish that so that people are like, “Hell yes, this is the school that I went to,” instead of like, “Well, that’s where I started, but then I got an MBA from wherever else.”

[00:59:09] So think about what you’re optimizing for and work backwards from that. Um, let’s jump over… I think you’re one of the last ones, so maybe we can, Daniel, pass the mic over and-

[00:59:16] Audience member: My question is more about, uh, like you’ve been like a 2X, 3X founder now. Uh, how has your approach towards product market fit really changed over the years and all the time that, uh, you’ve like, uh, done things and, uh, like even for you, like, do you think there’s like a change?

[00:59:36] Because, uh, you, you both mentioned it’s like the hardest thing for you all. So how, how do you all approach that if

[00:59:44] Nathan: How do, how do we approach which part of it?

[00:59:46] Audience member: Uh, product market fit in general. Like, how has it changed for you over the years?

[00:59:51] Nathan: Yeah. I mean, you could say that I haven’t started another company because I’m too scared to face the abyss of a product market fit over again.

[00:59:57] Like, that’s the, uh, that’s the hard- like the absolute hardest thing, and you can’t buy it. Like, yeah. I’ll think about my answer more. Do you have, have some thoughts?

[01:00:07] Ankur: Yeah, I think, I think it’s not binary. I used to probably in the past think it’s more binary, like you either have it or you don’t. But with Carry, we had product market fit for a relatively small market.

[01:00:20] So we had like small product market fit, which was a good, not great company. So as I think about product market fit now, I think it’s, it’s as important as ever, but it’s not just any kind of product market fit. It’s product market fit in a very, very, very large market. Um, so that does change my thinking.

[01:00:37] Um, I think from … One thing I may do differently if I ever am stupid enough to start another company is I would probably promote and market it a lot less early on, find other signals, and try and like really make the product market sort of engine work before fully even committing to like, okay, I’m gonna go out and raise money or whatever.

[01:01:03] Like, I’d be fine taking that risk off my balance sheet and see, can I build something that is working in a really good way? And only then go out and raise capital, go out and, you know, do the whole company thing.

[01:01:17] Nathan: I think that’s a hard part about having an audience or a reputation as you come in, because it’s sort of like getting the advice from your friends and them lying to you.

[01:01:25] Your audience can do that in the same way. They’re like, “Oh, this is the coolest thing. I’d buy it just ’cause your logo is on it or, or because you’re, you’re building it.” And it might not be sustainable. And so you have to … You both should take advantage of every single opportunity you have. Like, I had this idea when I launched Kit early on that I didn’t want to use my audience because that was cheating somehow, which is the dumbest idea.

[01:01:48] Like, if you’re trying to, like, do one of the hardest things ever of, of build a company, like, use every advantage you have. Like, every unfair advantage. Um, but then you also have to, if you rely on an audience, you have to go find the people who don’t know you at all, and seek them out, and be like, “Hey, will you buy it?”

[01:02:06] And they’re like, “I have no idea who you are, but actually that sounds like that solves a real problem for me. So yes, I will, I will buy that.” All right, we gotta wrap up there. This has been a lot of fun. Thanks for coming to the very first, uh, live podcast at Kit Studios. I appreciate it. And Ankur, thanks so much for coming out.

[01:02:21] Ankur: Yeah, thanks for having me.

[01:02:24] Nathan: If you enjoyed this episode about building a company on your own terms, definitely check out episode 81 with Justin Jackson. He’s the co-founder of Transistor, which is a beloved podcast hosting company he built without any outside money. So that’s a great bootstrapping story if you’re interested in keeping control of what you build.

[01:02:41] Like the video if you enjoyed it, hit subscribe on YouTube, wherever you’re listening, and

[01:02:45] I’ll see you next week.