March 24, 2025 • 36 mins
Ryan and Will discuss the evolution of startup location strategies. They reminisce about the bygone era when relocating to major hubs like San Francisco was essential for success due to access to talent, investors, and networking opportunities. Now, with advancements in remote work, AI, and digital connectivity, these factors have become less relevant. Ryan and Will delve into the changing dynamics of raising capital, building teams, and cultivating networks without needing to uproot one's life to a specific city.
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Wil Schroter
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Ryan Rutan
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What to listen for:
00:39 The Shift in Startup Location Importance
01:46 Reevaluating the Need to Move for Startups
01:58 The Impact of Remote Work and COVID-19
03:51 Debating the Necessity of Moving to San Francisco
06:12 Talent Acquisition in the Remote Work Era
09:23 Financial Considerations and Cost of Living
15:10 The Role of Investors in the New Startup Landscape
17:54 Questioning the Need for Large Engineering Teams
18:21 Capital Requirements and Investor Expectations
19:14 The Evolution of Pre-Seed Rounds
22:27 The Impact of Technology on Investment
23:43 Relocating for Networking Opportunities
27:13 The Shift in Startup Location Necessities
32:03 The Value of Flexibility in Startup Locations
35:59 Conclusion: Startups Can Thrive Anywhere
Mark as Played
Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
(00:00):
Welcome back to the episode ofthe Startup Therapy Podcast.
This is Ryan Rutan, joinedas always by Will Schroeder,
my friend, the founder,and CEO of startups.com.
Will, we've podcastsabout this before.
In the past and, andhistorically, you know, the,
the mantra in, in startupswas very much like that
of real estate, which waslocation, location, location.
Right?
It used to, yeah, used to seemto matter a lot, particularly
(00:20):
if you wanted to get fundedand what was it now, almost 10
years ago, you packed up thefamily and moved across country.
In order to be at theepicenter of the startup
world in in California and.
How'd that work out andlike, what would you do
differently this time?
Would you still do itnow, like 10 years later?
You know what's awesome?
I wouldn't have to, I, yeah.
You know, I was, I was havinga conversation with, uh, with
(00:41):
the founder last week and shewas talking about she wanted
to move to California, SanFrancisco specifically, you
know, she said, Hey, you know,that's where the capitalist.
And uh, and I said, well, youknow, I've done that myself.
I've, I, I moved my familyspecifically out to San
Francisco, uh, to be closer toeverything, you know, et cetera.
This is.
But as I was explaining it toher, I was starting to think,
(01:02):
you know, some of this stuffactually doesn't apply as much.
'cause yeah, when I movedout there, I moved out to,
lemme get my dates right.
I moved out to, to,uh, Los Angeles, to
Santa Monica in 2006.
And then, uh, later onI'm make up my dates.
2009, I guess 2010 wentto San Francisco and
then, then back to la.
Doesn't matter.
Point is I, wasthere a long time.
(01:23):
Yep.
And it was.
A very expensive move.
And I don't just meanfinancially, I mean just
like lifestyle wise.
You know, my, my family, allmy friends, you, everybody else
was in Columbus at the time.
Yeah, yeah.
And moving was, wasa huge commitment.
But at the time, all thethings you needed were there
specifically the talent,the money, the, you know,
uh, the infrastructure.
Everything else was there.
(01:43):
And so you kind of hadto make the pilgrimage.
But as I'm explaining itto her, I keep saying to
myself, well, you know.
That actually doesn'tapply anymore.
Wait, no.
That actually doesn'tapply anymore either.
And after a while I was like.
I don't think youreally need to move.
Yeah.
It's, it's crazy.
But I mean, think about allthe things that have happened
since then from a globalpandemic that, that made the
already, uh, fairly strong pushtowards remote work just become
(02:06):
a thing for, for everybody.
The fact that we're allessentially now Zoom natives,
like right, where, youknow, we're, we're doing
stuff like this on a, on a,a, you know, daily basis,
multiple times a day.
Where it no longer feelsweird, we're more socially
connected via the, thenetworks that we use online
than we ever were before.
Yep.
And so the, I mean, even, evenjust in, since the time that
you and I did this, anotherversion of this podcast
(02:27):
previously, things have changedagain, like significantly
unbelievable.
And so I thought it was worthrevisiting because I, you know,
incidentally wound up revisitingit without even realizing it.
It was really interestingbecause I wasn't even trying to
make the case for not moving.
I was making the opposite case.
Right?
Yeah.
So I was trying to state it.
I just like keptcorrecting myself going,
you know, well actually,
(02:49):
yeah,
yeah, yeah.
But actually, so I thinkwe look at three reasons.
Three, three categories.
Okay.
That startups move.
They move for, becausethey wanna be where
the talent is, right?
Yep.
Which, you know,was always valid.
They move because if, if they'reraising, because they wanna
be where the investors are,and that's pretty specific.
And then the third is theywanna network, they, they
wanna be around other peopleand, you know, grow their
(03:10):
networks in the zeitgeist.
Yeah.
Yeah.
And it's just, what was reallyinteresting is as I looked
at those three, like seminalreasons, you pack your shit and
go, I was like, damn, there'sno way I would do that now.
And it was a great experience.
So I'm not looking at it like,oh my God, it was terrible.
It's amazing.
I, you know, I got, Iraised money from investors.
I hired tons of people.
(03:30):
I, I built a huge network.
Like, uh, I did all the things,but if I had to do it over again
right now, probably wouldn't.
Yeah.
I think there's a differencebetween being a good
experience and it beinga, a necessary thing.
I think we talked to somany founders who are
like, I have to go do this.
I don't want to, but I have to.
And I think that that'sjust, that's, that's
something that we will.
Probably end up dispellingin the next 30 to 45 minutes.
(03:51):
Yeah.
You know, and, and I, Iposted this, uh, yeah.
After I had that conversation,I posted this on Reddit.
Right.
And I, Reddit alwaysfascinates me because
nobody's happy on Reddit.
So if, if I wanna make sureeverybody, like I can get
a complaint from everybody,I post it on Reddit.
Yeah.
It's good place.
And so I posted on Redditand I, I think I was a
little more specific.
I said, is it still worthmoving to San Francisco?
And I wanted to make itspecific to San Francisco
(04:12):
so I didn't get everybodydefending their, their city.
Right.
And, uh, mixed results.
You know, some people werestill adamant like, if you're
gonna build a big company, ithas to be in San Francisco.
And other folks were, I saw someof that conversation though, and
like at least one or two ofthe people were like, yes, you
have to move to San Francisco.
And then when you lookat their location like.
That's not wherethey were though.
So like they're tellingyou you have to go do this,
but they haven't done this.
(04:32):
They're not doing this.
Like, okay, come
on.
I love Reddit.
'cause it's a mixed bag.
You know, it's just a differentversion of social media.
And uh, I posted it thereagain because I knew people
would have strong opinions.
Right on.
Like, if you're on Twitter,if you're on LinkedIn, you
tend to follow people'sopinions that you like.
You know, if you're aDemocrat, you follow
Democrats, you're Republican,you follow Republicans.
But on Reddit, they just tend tothrow everybody in the same room
(04:53):
and you kind of get everything.
So to your point, whatwas interesting about
the conversation, itwas a pretty lively one.
There are still people thatgenuinely believe that, like,
again, this is San Francisco,but I'm using that as a proxy
that believe if, if you're gonnabuild a meaningful company,
it's still in San Francisco.
And there's datato support that.
I, I, I, I think it's a littlebit, I dunno how causal it is.
It's, you know, the biggestcompanies are in San Francisco.
(05:14):
Oh, maybe.
Maybe the, the bestentrepreneurs end up moving
there and build them there.
It doesn't mean thatthey couldn't have
built them elsewhere.
It just means they didn't.
I think it becomesa self-fulfilling
prophecy at some point.
If everybody thinks theyhave to go there to build,
so that everyone goes thereto build, then by nature
of everyone building there,
that's where it's gonna happen.
Right?
Yeah.
It's kind of hard to avoid.
The second part that nobodytalks about is yes, that's
(05:35):
also where people go to fail.
Yeah.
Like far more of themfail in San Francisco
than anywhere else also.
Yeah.
And so, uh,
look, this isn't a everyoneversus San Francisco thing.
I just thought thatwas an interesting, you
know, single data point.
But what was interesting isI feel like if I had posted
that four or five years ago,the number of folks that
said, you've gotta be in sf.
(05:56):
Would be much stronger.
I mean, again, I moved there,so I, I, I clearly like, you
know, believed in that thesis.
I just don't believe init the way I used to.
Not knocking sfit's a great city.
I'm just saying theworld has changed.
So let's talk about it.
Sure.
Let's talk about firstI wanna get to investors
second, if you don't mind.
I, because that's fine.
Not everybody's raising, butwhen people are like, hey,
like you know, I need to move'cause I need access to talent.
(06:17):
Forget SF for a second.
Yeah.
I need to move.
'cause access to talent.
I think you opened it up.
I think remote work.
Put a bullet in that becausewe're not centralized anymore.
It did.
Yeah, so I think the, theidea that you need to be in
a place, in fact it, it's atthis point, like I think five
or six years ago, we couldhave said like maybe we're
pretty close to that line.
Three or four years ago.
I think we could have saidlike, yeah, it probably
(06:38):
doesn't matter right now.
I think it actually matters,but in the opposite direction,
which is to say that if you wereto try to go somewhere and say
you have to come into an office.
Look at how that's going fora lot of companies right now.
So it, it can actuallywork against you if you
move somewhere specificallyto gather humans.
And that kind of doesn't matterwhere it is at this point,
San Francisco or otherwise,you're gonna struggle.
Right?
Right.
It's just not what people want.
(07:00):
It's no longer like, therewas a point at which it
was, it was sort of abenefit or, or a, a perk.
Remember when we, whendid we start doing this?
Will?
2014? Yeah.
2012. Was it that far backwork from home Wednesday?
Yep.
Oh, oh.
Work
from a Wednesday.
Yeah, yeah, yeah.
That was 2014.
2014 work from home Wednesday.
Right.
Which then expanded to workfrom home Wednesday, Friday,
(07:20):
which then expanded toMonday, Wednesday, Friday.
So by the time the pandemichit, we were in the
office two days and Yeah.
Right.
It had already gone.
You know, you and I talkabout this a lot, but yeah.
The minute you makesomething a, a benefit or
a perk for, for people, itvery quickly becomes the
baseline and the expectation.
Now it's just an entitlement.
And like that's everybody.
Now everybody's in thatsame boat where it's like,
I just remote is what?
(07:41):
What do you mean in person?
Well, I think it,it's a few things.
Number one, like Covidbroke the seal, right?
Yeah.
A hundred percent.
Covid basically said,look, the whole world
literally can work remote.
Like you can't make anargument that it can't be done.
Now you can make an argumentand, and plenty of my, my
smart friends have thatsaid, I just prefer to have
everyone in the office.
I get that.
(08:01):
Like, I, I, yeah,the argument's valid.
I'm not saying there isn'ta version where having
people in the office is.
Bad.
Right?
I am.
I'm, I'm saying that, butit's a preference at this.
It's a preference.
You, you don't,
I prefer to havepeople in the office.
Yeah.
Before it was table stakes.
We had an officelike everyone else.
Yeah.
Even though we were only goingto it two days a week, days a
week, still paid the same amountfor the damn office, right?
Yep.
(08:22):
And because of that, therewas an expectation that if
our office was in Columbus,then our team was in Columbus.
And now.
Like it doesn't even occur tome to hire someone in Columbus.
Not being anti Columbus,I'm just saying No, it
just doesn't matter.
Right, right.
You don't have tothink parochial.
That went away completely.
Yeah.
I'm not gonna seethem either way.
Right.
Yeah.
They're gonna be whereverthey can be and it doesn't
(08:44):
work for every company.
I get all that.
Sure.
But, but every companyusually, you know, founders
making these decisions areusually sub 50 people, if
not just the only person.
And if we're talking aboutthe ability to attract talent,
let's say for the first.
10 to 20 to 30 people.
Okay, so we don't get intothis like scaling thing.
I have a hard time believingyou can't build a 30 person
(09:05):
distributed team anywhere.
Yeah.
I, I think it's, it'sactually even easier.
I think that some ofthe challenges with the
distributed team come whenyou surpass that point.
When you're at 50 Yeah.
To a hundred, 150.
There's a point at whichnow making a consistent
company culture becomes alittle bit more difficult.
Absolutely.
But I would argue, yeah, atthe, at the early stages,
it's, it's far easier.
You know what else is easierfrom a talent perspective,
if you have the money,you're not spending on San
(09:27):
Francisco rent to hire them.
Right, right.
Turns out people like thecash, they, they weren't paid
more than, like, it'd be coolto hang out in your, your San
Francisco office and get paidhalf of what I could pay if
you weren't paying that rent.
Or just the other side ofit is a lot of the people
that were in San Franciscodidn't wanna be there.
And again, I'm not picking onSan Francisco, take New York,
take any, any big high pricecity for a very long time.
(09:47):
You had to be in thatcity in order to to, to
get those opportunities.
And Covid really justchanged all of that.
I mean, COVID was awful, butthe one positive that came
out of it is it made us say.
Wait a minute.
I wanna live in Columbus,Ohio, but basically do
a New York City job.
Now you can, no surprises there.
But what I'm saying is a lotof the talent that before
(10:08):
you couldn't get access to.
Yeah.
Because they hadexpected to stay kind of
parochial to their city.
A lot of those people went home.
Right.
A lot of those people wentback to where they came from,
either to raise families orjust to to live, you know,
uh, without 14 roommates.
And I think that goes for miles.
You did it.
We did.
Yep.
We, we've, we've moved quitea bit since the, uh, since
the inception of the business.
But, um, I think that pointis, is extremely valid,
(10:31):
which is that before therewas sort of a, a, a fence
around some of that talent.
Yeah.
And I think at this pointthat fence is absolutely gone.
And it was driven bythe talent, right.
Like they said like, Hey, wedon't wanna be corralled here
anymore than anybody else does.
We saw it like, Isaw it actually.
So if you remember the, thecondo that I owned in Columbus,
I sold to a San Franciscan.
Yeah, it wanted to come backto the Midwest after having
(10:52):
been out there and, and built astartup for a couple of years.
Sold my, uh, house in,in Florida after we left
to somebody leaving,uh, the Bay Area.
It wasn't San Francisco, butthe Bay Area, uh, that wanted
to get outta there and, and,and buy something somewhere
else, like we saw a massiveamount of diaspora after it
became possible, like theminute it became possible,
people started moving around.
It's, it's so funnybecause everyone plays
the same Zillow game.
(11:13):
Yeah.
Like we were living in SanFrancisco and we were, we
were looking, we were, wewere in an apartment at the
time and we were lookingfor a, a home somewhere like
in Palo Alto and, you know,the home price of bananas.
And then you take what youwere gonna spend and ather
in, or where the hell youwere gonna go, and then
you plug it into any othercity you could live in.
Right?
Yep.
And it's, it's like youhave mansion by comparison.
(11:33):
And we did the same whenwe moved to Los Angeles.
You know, we ended upfinding a home in Beverly
Hills, which wasn't ourfirst choice, but that's
just kind where we landed.
And then we started lookingat, 'cause uh, you know, uh,
will, my son was born, wehad to find more room and we
started looking at other homes.
More expensive.
Then we took that sameprice and we looked at you.
Well,
we get anywhere else.
What would that do?
Somewhere else?
Yeah, anywhere else.
Probably
when you're there, youfeel so poor, right?
(11:55):
No matter how well you'vedone, you feel so poor.
Right?
And it doesn't occurto you like, um, you
forget after a while.
Like what that moneycould buy anywhere else,
or more importantly, youdon't need that much money
to live like, like what?
That life doesn'tcost that much.
It only costs thatmuch right here.
And I think peoplefigure that out quickly.
And so I think that that's,it's been nice for people to
(12:15):
be able to decouple themselvesfrom kind of like the life they
want and, and the job they wantand, and then not having to have
those two things magically lineup because they often don't,
um, or they don't, as lifecircumstances change, right.
Like when it was just, I. Youand Sarah, you know, being,
uh, you know, being in, inCalifornia was fantastic.
Like the minute you addtwo more humans, you need
to add at least one more,if not two more bedrooms.
(12:37):
Yep.
All of a sudden it's like,okay, big difference.
This is where we want tobe based on what it would
actually cost us to do this.
And yeah, unfortunately, likewhen that used to be hard coded,
hardwired to the type of workyou wanted to do, you didn't
really have much of a choice.
So you, you had to thenchoose between life and work.
Yep.
Which, look, you know, I, youand I both love what we do
and so like life is kind ofwork for us, but also like.
(13:00):
Work is supposed to serve life.
Yeah.
Right.
And so at the minute whenyou have to start making
trade-offs between the two,the calculus gets really ugly.
Yeah, it does.
And, and you know, the otherside of it though, is again,
moving to a city for talent, wehappen to be entering into an
era where a lot of us don't needas much talent, you know, with
the advent of ai, et cetera.
So the idea of scaling upthe way it used to mean I
(13:22):
raise lots of money and hirelots of bodies, that that's
how you build companies.
Yep.
And now it's like, is it.
I mean, low code, doesit have to be no code
AI fractional hire ondemand service, right?
Yeah.
Man, there's so many otherways to solve those problems.
Yeah.
Yeah.
And then, you know, I, Iheard a quip that I've heard
a million times on thatReddit and that subreddit,
(13:42):
which was, look, if you wannabuild a big company, you,
you have to go to a big city.
Right?
Because, you know, all the bigcompanies are in big cities.
And it's like, look, I get that.
But do you wannabuild a big company?
Yeah.
I mean, like, if you look at itin today's terms, one, if you
have a thousand people, whatthe fuck are they doing all day?
Right, right.
Seriously.
Like, I mean, this is a dumbexample and it, it's probably
(14:03):
works against me, but Ithought it was hilarious.
Like the, the, the, theevent, not the outcome.
When Elon Muskwent into Twitter.
And he fired 90% of the staff.
Yeah.
And that was years ago.
And Twitter is still, is around.
And again, I, I don't wantanybody to lose their job.
So this isn't like,it's not that.
No.
It's just like, hold ona sec. He did get rid
of 90% of the staff.
90% of people.
(14:24):
Yeah.
And the company'sstill around like.
Nothing changed.
Seriously.
What were they doing
all day?
Part of it is predicated onthe fact that like people
have also set their, theirsights on these really wild
and crazy outcomes, whichyou and I have talked about.
Like, like you don't haveto sell a company for a
billion dollars to havea really good lifestyle.
And as you reduce things likestaff counts and costs, you
also don't have to build nearlyas big of a business to just
(14:45):
cash flow really well and, andbuild a stable business and
really enjoy the hell out of it.
That's okay.
Right.
And if you do all this costbaked in, then you kind of
have to build a big business toget to the point where you can
extract as much money from it.
But if you don't needto do those two things,
then just don't.
Right?
Right.
Just build a good businessthat puts cash in your pocket,
pay your teams well, and thensubscribe to the AI services
you need to get it all done.
(15:06):
Well, so which, which bringsus to the next category,
which is investors.
I wanna be clear, I have notseen the same stratification
or diversification ofinvestors by location that
I've seen by talent, et cetera.
Okay.
Yeah.
Now let me unpackthat a little bit.
Part of it is since the startof Covid, like 2021 was a boom
year, you know, one of thegreatest like venture years of
(15:28):
all time IPOs and everythingelse like that, and it went
nuclear winter after that.
Yep.
So part of the reason I'm notseeing like a mass proliferation
of investors, uh, investingeverywhere in every location
because they're not investingin any location anywhere.
Yeah.
They're not investing at all.
Right.
It's, it's been incredibly dry.
So I, I haven'tseen that behavior.
However, what I'm reallyfascinated by, and, and Ryan,
(15:49):
we did an episode on this,uh, not, not, not too long
ago, is how much capitalstartups need in this new era.
Right with, with, witheverything dramatically
changing, particularly talent,that's always the biggest line
item is, is the staffing line.
You know, something that'sreally funny about everything
we talk about here isthat none of it is new.
(16:10):
Everything you're dealingwith right now has been done a
thousand times before you, whichmeans the answer already exists.
You may just not know it.
But that's okay.
That's kind of whatwe're here to do.
We talk about this stuff onthe show, but we actually
solve these problems alldayLong@groups.startups.com.
So if any of this soundsfamiliar, stop guessing
(16:30):
about what to do, let us justgive you the answers to the
test and be done with it.
We, I had a, an interestingdiscussion a couple
weeks ago, uh, that, thatmirrored this, which was.
The idea that people were,there were a group of people
complaining about the fact that,you know, investors are only now
writing checks for profitablecompanies with traction and
customers and all this stuff.
And I'm like, yeah, they wannainvest their money where they
think you're gonna get it back.
(16:51):
Yeah.
Weird.
Huh?
That didn't,
to be fair, investors havealways wanted to invest
in profitable companies.
That's it, right?
Like it's a limited number.
Yeah.
Yeah.
My not full counter, but sortof the yes and or yes, but
the fact that you can actuallyget to those points with a
lot less capital now, right?
Yeah.
Yeah.
It doesn't takenearly as much money.
Right.
It used to take, if you had togo build an entire web platform,
right, and there's gonna be,let's just say conservatively
(17:13):
$250,000 to build that.
Yeah.
You can now build somethingthat would be commensurate
to what you could build fortwo 50, for 25 to 50 now.
Yeah.
So we magnitudes differencein the cost it takes
to get to that point.
So that's part of why investorscan say, we can do that.
And they're not actuallyhamstringing the, the
start of environment.
Like it might soundlike they are.
Yeah.
(17:33):
And, and the other side of itis, you know, investors did do
those, those huge checks, thebillion dollars in 500 engineers
kind of move and it didn'treally back out very often.
Correct.
So, so they kindof got burned too.
Yeah.
But again, sometimes when youtest your thesis and it doesn't
work, you gotta make a new one.
Yeah.
Look, if in today's terms youstill need 500 engineers and I'm
using engineers just to be sure.
(17:53):
Right.
Then I, I'm, I'm really gonnaquestion your efficiency.
I'm gonna question, whatthe hell are you building
with all those people thatyou couldn't be doing with?
That's clearly a sports
league that only hasplayers who are engineers.
Right?
Right.
Can't imagine whatelse would take 500
engineers at this point.
A tiny fraction of ourlistening audiences is out there
looking for tons of engineers.
So I wanna be clear, like,you know, we got plenty of
folks who are doing CPG, whoare doing services business,
(18:15):
who are doing like whatever.
So.
You know, they hear us saythings like that and like
do that, like that doesn'teven remotely apply to me.
And what I'm saying is I getit, but if, if you were packing
your stuff and going, going toBig City, whether it was Boston,
whether it was sf, whetherit was New York, you know,
whatever, in search of capital,to be honest, you generally
had to, and I don't know ifthat's changed dramatically.
Okay.
(18:35):
What has changed is howmuch capital you would need.
Yeah.
To make that trip worth it.
You know, like back whenyou needed $10 million
to do anything meaningfuland there was a time.
You had to go to where there was$10 million and there was like
three cities you could do it.
Now I'm just saying, andyou're saying the same thing,
like the capital requirementsjust aren't nearly what they
were, if any, in some cases.
(18:56):
So the idea of having to,to, to drop everything and,
and, you know, disconnectyour life to get out to the
most expensive cities justisn't what it used to be.
So I, I think.
The need for investorshas gone down.
How much, how much theycare about location.
I don't know how much it'schanged yet, to be honest.
I don't know.
I don't know.
It'll be interesting to see.
Let me ask you ahypothetical here.
I just want to get, get a,uh, crystal ball moment here.
(19:19):
I'm curious what you thinkover the last 10, 15 years
we've watched, you know.
Pre-seed rounds go from25,000 to 2.5 million.
Yeah, you're right.
Right.
Just the funny roundshave gone outta control.
As we start to see less capitalrequired to to launch and
build and grow, do you thinkthat we'll start to see the
round sizes come back down?
(19:39):
Will there be a correctionaround that or will it
just be more money funneledinto less companies with
the same size rounds?
The venture guys have astrong incentive to put
more capital to work.
Because it ain't their money.
That's how theymake their money.
Yeah, yeah, exactly right.
So, so they have a strongincentive for there to be
500 person engineering teams.
Okay.
So I wanna be clear, likefrom their standpoint,
(20:01):
being more capital efficientdoesn't entirely, you
know, jive with them.
And now again, theseare super smart people.
I'm not saying like they,they're trying to waste money.
I'm just saying.
Be clear when they need biggerfunds and they can justify
bigger funds that they getmassive takes from, that
works really well for them.
Sure.
If you were to say, Hey,VCs from this point on, no
(20:22):
startup will ever need morethan five or $10 million,
they'd all go outta business.
So, so again, they stilllike the idea of being able
to put, put money to work.
Of course, they wantstartups to be efficient.
They don't like theidea of burning money.
Right?
And, and look, staffwas the big burn, right?
Absolutely.
Always has been.
'cause it cost a fortune tofind all those people, you
know, think recruiter fees,et cetera, bonuses, whatever.
(20:44):
Then you were always pullingpeople from their last
job to a new job, whichmeant you were paying the
most they've ever made.
Right?
Yep.
So you had to be wildlyand somebody else was
gonna do that to you andpull them to their job.
Absolutely.
Right.
And you gotta pullsomebody else.
Yeah.
It just becomes a cycle.
Building on that.
So as more startups neededmore talent, because that
money was all, you know,getting, uh, foisted onto
all these companies Yep.
To hire more talent.
(21:04):
Market rates were goingup and demand was going
up, fees were going crazy.
Right.
Like it kind offed itself Right.
You know, and inflation oftalent and, and, and cost.
Now all of a sudden,particularly for things
like engineering, where goodengineers and smart people
are always valuable, justa hundred percent, they can
do more than, they could domore as a single unit more.
Yep.
So you just don'tneed as many of them.
(21:27):
That's a big change.
Dramatically changes the capitalrequirements to get to the same
point within a startup company.
You bet.
You bet.
There was also, again,all these things kind
of have a ripple effect.
There was also a notion,let's say in 2021, in like
the, the height of the go-go.
That was our 1999of, of recency.
Yeah.
There was a notion that in orderto look like you needed more
capital and to be valuable, youhad to hire a lot of people.
(21:49):
If I go out and I say, I, Ineed a $300 million round 'cause
I need to hire so many people'cause we're growing so fast.
That was a strong signal.
That's exactly what investorslook for to say yes.
A company with, with thoseambitions and that momentum.
That's where I, I wanna parkcash and, and there's all kinds
of good reasons to believe that.
Now, but since so manycompanies, VCs got
burned by doing that.
(22:10):
Yeah.
And, and not just VCs, youknow, it goes down the line
to angel investors Sure.
Et cetera.
Where all it starts.
Now there's a version where atleast they're like, you know,
that didn't work out so well.
Yeah.
Like, we kind of got crushedacross the portfolio.
So how about we not dothat again and kinda
look, look at how, howcan we be more efficient?
How much do you thinktechnology's played
a role in this too?
I mean, like, yeah,they may still prefer to
(22:32):
invest somewhat parochial.
Like I, I don't, I don'thave a strong thesis around
that, but certainly likeeverybody's comfort level.
Like, well, you know, 2015you packed your bags and
you went and found investorsin 2025, we hop on a
Zoom and we do the pitch.
Right.
In fact, I know a lot of peoplethat just prefer that, right?
I don't want somebody walksinto your office with a
really bad pitch, likeyou're stuck with them.
(22:53):
Oh God.
It's like an how many, howmany, how many investor offices
had to tolerate you and Elliotsitting in the, in the, in
the waiting rooms, uh, eatingpizza, waiting for your,
your partner pitches, right?
So like, at some point it's waymore efficient for them too.
It is, and again, investment'sbeen slow, so I don't think
we're really gonna see whatthe appetite is for going
outside your parochialbubble, so to speak.
(23:15):
Yeah.
Uh, until we see the, the nextbig, like, you know, kind of
go-go moment of investing,but by the time that happens,
let's say it's a few yearsoff, you know, where things
kind of really do cycle up bythe time that happens again.
Again, with the advent of ai,of fractional, of remote, et
cetera, you're just gonna havea very different climate for
what people need than they didnow, because before we were all
(23:36):
raising money to hire people.
Yes, there was.
There were marketing budgets,but those scale with the
growth of our product, itwas hire this massive staff
and hope it works out.
Which, so let's go to thethird category though, where
I wanna go to a big city.
Because I, I want thenetworking opportunities and
Ryan, I, I wanna split this.
There's no questionthat going to a big city
again, we're talking aboutlocation, that going to a
big city is gonna open youup to more opportunities.
(23:58):
You're about to move to a bigcity for exactly this reason,
for your whole family, right?
Exactly.
Yeah.
How do you justify it?
Because it's, it's gonnacost way more where you're
going than where you are now.
Well, we did the, we didthe calculus on it, right?
Like there are specificthings that are missing in
our current geography, right?
From a family perspective,there's things, I don't think
everybody knows where you are.
Uh, so we're, we're currentlyin Antigua, Guatemala, right?
And we're getting ready tohead to Madrid, Spain, which
(24:20):
are, uh, about, you know,polar opposites, right?
We've got.
30,000 people here.
There were 30,000 peoplein the, in the block that
we stayed in over thesummer, uh, in, in Madrid.
Right, right.
So complete different accessto things like culture and
arts and, and organizedsports and schools and just
all kinds of other stuff.
And then all the accessto all of Europe.
So in our case, this isvery much a taking advantage
(24:42):
of the fact that work isdecoupled from life and that
life can happen where itneeds to happen in order to.
Deliver what we, what we want.
So as we do the plus minus,yeah, there are lots of costs
involved in the move, butaccording to the calculus,
we performed the benefits.
Far outweigh that.
Right?
You bet.
And we're, we're, we're movingbecause we want to, not because
we feel like we need to, sowe're running towards something,
not away from something or the,I mean, I guess we are still,
(25:04):
we're running away from thelack of, of resources here.
So for us, we're looking atthis going, this is 2015.
In a lot of ways, like we cannotget, we can't replace some of
the stuff that, that we canget digitally now that we want.
Right.
And so we're, we're in aposition where it does make
sense to, to pack up and go,
you know, it's, it'sinteresting to me is that
when I moved to, uh, to LosAngeles and to San Francisco,
(25:25):
as you remember, I was.
Like Johnny Networker,like, like I, I was, you
know, in, in five to sevenmeetings a day when I first
moved to Los Angeles, to,um, Santa Monica, I hosted
over a thousand people Yeah.
At my place, right?
Yeah.
Uh, I mean, unbelievable numbersof people as far as networking
and meeting people, right?
So, clearly I was a verystrong believer in the
(25:46):
networking opportunities,and it was awesome.
Now, a few things that, youknow, that, that I, I wanna.
Put together, number one,if you go to a bigger city,
and that's most of whatwe're talking about here.
If you go to a bigger city,just like you said with
Madrid, you are going tobe exposed to more stuff.
A hundred percent you'regoing to meet more people.
I said like the folks inLA or the folks in San
(26:06):
Francisco as an example,paid a fortune to live there.
Yeah.
So by definition they were alllike, nobody was complacent,
like everybody was therebecause trying to take advantage
of it, they worked their asoff to be there for we had.
Yeah, yeah, yeah.
And I like that vibe right now.
Once you got past thatthough, like let's say
you're living in New York,you live in San Francisco,
you're also like, this isa really small apartment.
(26:27):
I mean, LA is the same thing.
This is a really small apartmentand my quality of life sucks
depending on what you wantyour quality of life to be.
Now, all that said, what itwas really about is you didn't
have a way to find or me.
Any of these people, unless youwent to those cities that just,
you couldn't do it otherwise.
Like the other version ofpeople, like, oh, I'd meet
people at conferences.
(26:47):
I've been to amillion conferences.
I'm the most outgoingperson I know.
I've never been to a conferencethat I thought was worthwhile.
Like ever, ever in 30 years.
Right?
Yeah.
It's always
the biggest waste of time.
It's always the thethe, the thing, right?
Like, oh, I'm gonna go,I'm gonna make, you know,
everybody that I need toknow is gonna be there.
Cool.
Are you actuallygonna talk to them?
Are you gonna make meaningfulconnection with them?
Oh my god.
Ships passing in the night.
Right?
Yeah.
I think that's, there'ssomething else that's
(27:08):
interesting there, and I thinkwe can talk about like how
much that's changed now and theother ways that it's changed.
But like one of the things thatthat always struck me was, and
then sure, there are lots ofpeople there, but one of the
things that ended up happeninganytime I've been in a bigger
city was that it felt like.
Less of it was in my control.
Right.
And there was just alot of osmotic impact.
Yep.
Some of which endedup being good.
(27:29):
Some of it wasn't.
You bet.
Right.
Some of it was just, it endsup just being time draining.
Time wasting.
Right.
Because everybody, because atsome point like that you have
marketable things that peoplewanna talk about too, too.
It's not just about what you'regonna take from the networks,
but what you're gonna give.
Um, and I found that there wasoften an imbalance in that for
me, and, and that it made me.
A little less deliberate.
Like at some point when you're,when you're in the fish or
(27:51):
in the barrel with the fish,you're, you become a little
less picky around like whoyou're interacting with.
Whereas now that's a five.
We've got LinkedIn, right?
We've got plenty ofother social media.
We've got social mediaX, we've got all of it.
It's crazy.
Talk to anybody.
I want to anytime I want to
because that'sbecome such a thing.
Yeah, I think two thingshave happened for me.
One, I meet 10 x more peoplenow than I ever met before and
(28:14):
again, and I was doing likefive to seven in person meetings
where I would reach out topeople to get to sit down with
them for no purpose, by theway, just to get to know them.
And it was.
Exhausting, right?
Probably.
Yeah.
So for them, uh, but,but my point is, it's
exactly what you said.
I could only meet withthe people that happen
to be in my geography orthat I would bump into.
Okay.
Yeah.
(28:34):
And I tried to, you know,create as many opportunities
for that to happen.
I met great people.
However, when it comesto who do I need to meet,
like professionally.
I can DM anybodyright now, anybody.
Right.
Like it blows my mind.
And, and it also happensthat like when I DM somebody
that I really need to meetthe probability anymore that
they're in LA or San Franciscoor where I would've otherwise
(28:54):
been is damn near zero.
Yeah, right.
It is not zero
because again, there's still,you know, more people there.
But like for some reason, thefirst person that comes to
mind, not that I, I'm tryingto meet, but I was DMing
with recently, is Dan Martel.
Uh, right.
And Dan, I'm not knockinghis location, but is in BFE
Canada, if I recall right.
Moncton, I think iswhat it's called.
(29:16):
And I love that.
I love that because likeDan just hit a million
YouTube subscribers.
Right.
You know, he's JohnnySocial now, but he is in
Moncton, Canada, dude.
Yeah, right.
Like Dan wouldn't have been ableto meet anyone 15 years ago.
In Moncton Canada.
Well, to be fair, Moncton isknown as the San Francisco
of absolutely nowhere.
It's not,
(29:38):
this is me giving Dan ashout out, by the way.
Um, I, I, I make sure it comesout the right way because Dan
in Moncton can be the mostpopular person, uh, in business.
Anywhere he wants, anywhere hewants doesn't matter right now.
Again, I had to do that samething with an ungodly amount
of physical effort within-person events, et cetera.
(29:58):
And Dan's doing it withouteven leaving his hometown.
What I'm saying is that levelof connectivity just didn't
exist at the level it does now.
No, even remotely.
Something else is funnyabout that, right?
Like the fact that we, wehave this digital, like on
one hand it's a lot easierto just reach out digitally.
I don't know how it was for you.
But, and, and maybe thisis even, I'm, I'm, now I'm
trying to figure out, thisis like more of like a post
(30:20):
pandemic kind of thing.
When I do get in-personintroductions, not in-person
introductions, but maybelike somebody local, like,
Hey, somebody here thatwants to sit down with you.
I almost always say yes.
Part of that might just be therarity, but part of it's kinda
like it feels rude to say no.
Yep.
Whereas.
With digital outreach,I think it forces people
to be a little bit moredeliberate, a little bit more
polished in the outreach,A little more purposeful.
(30:42):
Whereas like before peoplecould just reach out and
be like, Hey, you know,I'm, I'm gonna be in town.
Would you like to get together?
Like,
yeah.
Okay.
Right.
Yeah.
Whereas if somebody reachedout to me on LinkedIn, they're
like, Hey, do you need offshoreweb development services for an
app that you're not building?
No, I don't.
Right.
I don't have tospend time on that.
And so like, I think it'ssomehow by being digital,
despite the fact that wehave this ability to reach
(31:02):
anybody, it's raised the bara little bit for what that
communication looks like.
I actually appreciate it a lot.
Pointing to Dan for a second.
What I'm saying is Dan hasa massive profile Yeah.
In Moncton, uh, you know,sitting in Moncton, Canada.
Right.
I'm just saying that's possible.
Whereas it wasn't before.
Again, this isn't the sameas like if I was 27 years
(31:22):
old and someone was like,Hey, you should move to
New York, or you know, SanFrancisco or something.
I would do it right becauseit would cost me nothing.
It'd buy me a ton.
Great big city experience.
I did it.
It was awesome.
What I'm saying is nowI just wouldn't have to
before you have to, I hadto, I didn't have a choice.
Yeah, right.
Now I just don't have to.
And that's a big deal.
(31:43):
You don't have to moveto San Francisco to,
to, to find work, right?
Yeah.
Like you can go
anywhere when Yeah.
I think the minute it wentfrom being a prerequisite to a
nice to have, if I want to haveit, maybe not even a nice to
have, it's a a if you want it.
Right.
It became completelydiscretionary.
That was super powerfulin, in so many ways.
Right.
(32:03):
Look like we've, we've talkedabout a lot of stuff like there,
there are still some advantages.
Of course there are, right,there are advantages like
things like you mentioned,these serendipitous meetings
and cultural immersion,some of the stuff that
I'm moving for, right?
But the, but the cost benefithas certainly shifted and I
think it's no longer a caseof, of necessity and, and
more, more like one of desire.
(32:24):
But the other side ofit is you're, you're
not moving for work.
Yeah.
Also that a hundred percent.
Yeah.
I mean, that, that'sdramatically different.
You're saying, I wannago have these experiences
in this other place.
Yep.
Now, if, if you guyswere, you know, super into
skiing, you might be goingto Provo, Utah, right?
Yes.
Like, right, like there mightbe a totally different outcome.
You guys have an amazing,uh, ability as a family
(32:44):
to ingratiate yourself inthe local culture and, and
pull so much from that.
But it has nothingto do with your job.
No.
Nothing.
Right?
Nothing whatsoever.
Now there will be benefits.
In fact, we've gone, we've gonethrough some of that recently
because there was then this,this kind of toss up between
Madrid and possibly Valencia,which gets us on a coast.
And there was some other, it's alittle bit smaller, a little bit
maybe easier to, to end up in.
And then we went backto it like, but why are
(33:06):
we actually doing this?
Right?
And a big part of it is forsome of that bigger city stuff.
And for me, from a workperspective, there are some,
there are some pluses to Madrid.
It's a much biggercommercial center.
There are way more startupsthere than there were
going to be in Valencia.
Are there as many asthere are in, in San
Francisco or New York?
No.
But it's still from whereI am now, it's gonna
be a massive increase.
And so there will be benefits,but is again, but it's
(33:26):
not, we don't have to makethe choice based on that.
Again, it's, it's not, andthat's really what we're
saying is isn't relevant.
Right.
It's just a
lot less relevant than it was.
It's changed from ayou have to do it.
Mm. It could benefitin certain ways.
Yeah.
Like when Sarah and I movedto San Francisco, you know,
I certainly had a, a singleunified goal, which was, at the
time we were buying companiesand most of the companies we
(33:48):
were looking to buy were there.
And it worked outgreat, you know?
Yep.
It, it, it really worked out.
But from Sarah's perspective,you know, uh, my daughter Summer
had just been born, I thinkshe was five or so at the time.
She just wanted an adventure.
She was like, Hey, cool.
This is justsomething new, right.
I don't, something fun,something different.
Yeah.
The commercial aspect doesn'tmatter to me, and she got
to explore it, et cetera.
After a while, shewas like, guess what?
This city's terrifying.
(34:09):
Yeah.
I've seen it all.
No cross.
You can cross it an hour.
And I've seen it all.
I'm good.
It's the part they don't putin the brochure, but you know,
Sarah would, would, wouldleave our building, uh, with
a five-year-old in a stroller.
It would not go well.
It was, it was a very dangerousplace for a woman in her.
A little tiny daughter tobe walking around there.
There's reason you don't seeany kids in San Francisco.
(34:32):
Yes.
They're all adults anyway.
Um, this wasn't aknock on San Francisco.
I'm just saying like if she wasgoing for her own reasons, she
would've been out very quickly.
Yeah.
I would go there and, and Iwould put up with whatever,
because I needed to be there.
But now I wouldn'teven consider it.
I was like, yeah, Iwould never do that.
Not knocking San Francisco.
I'd go there for fun.
Right.
But if we're like, oh, ourbusiness has to be there, I'm
(34:52):
like, no, no, it does not,
does
not, does not need to be
there.
Yeah.
Yeah.
I, I think it's so interestingtoo that like, at this point,
because of this, this shift in,in like the, the value of the,
sort of the, the perks of beingin the traditional hubs, right?
That the value.
Of the flexibility has actuallygone up so much, right?
(35:13):
Yep.
Now that you really kindof can, I think there were
so many things that peopledidn't even consider before.
It just didn't, itdidn't occur to people.
They could just bewherever they wanted.
Yep.
And still do the thingthat they wanted to do.
And I think that is, in as muchas the value of the traditional
hub and what you get from ithas gone down to some degree.
I think that the, the biggerimbalance has actually been
created by the value of beingable to do what you want can
(35:36):
anywhere you want, has actuallygone up so significantly.
And I think that for me is whathas absolutely made it really
hard to say that like there's ahuge benefit in being, or that
a, the success of a startupis predicated on being in
some, somewhere very specific.
I'd say the flexibility tobe anywhere for me at least.
I, a lot of people that we know,uh, would far outweigh the, the
(35:57):
perks of the traditional hub.
Yeah.
So look, I, I think what,what we're saying isn't that
cities don't have their value.
Cities have value.
We love cities, right?
We've lived in them.
What we're saying is in thisday and age, you would be hard
pressed to make an argumentthat says you have to relocate
to a major city or a specificlocation in order for your
startup to be successful.
(36:18):
The, the truth is there are somany things that have changed
so dramatically that you cantake advantage of that you
just don't need to do it.
So I would say at thispoint, when somebody asks
you that question to say.
Hey, where's your startup based?
Your answer is whereverthe hell we want it to be.
And I'm damn okay with that
overthinking your startupbecause you're going it alone.
You don't have to, and honestly,you shouldn't because instead,
(36:39):
you can learn directly frompeers who've been in your shoes.
Connect with bootstrappedfounders and the advisors
helping them win in thestartups.com community.
Check out the startups.comcommunity@www.startups.com
to see if it's for you.
Could be just thething you need.
I hope to see you inside.
Welcome back to the episode ofthe Startup Therapy Podcast.
This is Ryan Rutan, joinedas always by Will Schroeder,
my friend, the founder,and CEO of startups.com.
Will, we've podcastsabout this before.
In the past and, andhistorically, you know, the,
the mantra in, in startupswas very much like that
of real estate, which waslocation, location, location.
Right?
It used to, yeah, used to seemto matter a lot, particularly
(00:20):
if you wanted to get fundedand what was it now, almost 10
years ago, you packed up thefamily and moved across country.
In order to be at theepicenter of the startup
world in in California and.
How'd that work out andlike, what would you do
differently this time?
Would you still do itnow, like 10 years later?
You know what's awesome?
I wouldn't have to, I, yeah.
You know, I was, I was havinga conversation with, uh, with
(00:41):
the founder last week and shewas talking about she wanted
to move to California, SanFrancisco specifically, you
know, she said, Hey, you know,that's where the capitalist.
And uh, and I said, well, youknow, I've done that myself.
I've, I, I moved my familyspecifically out to San
Francisco, uh, to be closer toeverything, you know, et cetera.
This is.
But as I was explaining it toher, I was starting to think,
(01:02):
you know, some of this stuffactually doesn't apply as much.
'cause yeah, when I movedout there, I moved out to,
lemme get my dates right.
I moved out to, to,uh, Los Angeles, to
Santa Monica in 2006.
And then, uh, later onI'm make up my dates.
2009, I guess 2010 wentto San Francisco and
then, then back to la.
Doesn't matter.
Point is I, wasthere a long time.
(01:23):
Yep.
And it was.
A very expensive move.
And I don't just meanfinancially, I mean just
like lifestyle wise.
You know, my, my family, allmy friends, you, everybody else
was in Columbus at the time.
Yeah, yeah.
And moving was, wasa huge commitment.
But at the time, all thethings you needed were there
specifically the talent,the money, the, you know,
uh, the infrastructure.
Everything else was there.
(01:43):
And so you kind of hadto make the pilgrimage.
But as I'm explaining itto her, I keep saying to
myself, well, you know.
That actually doesn'tapply anymore.
Wait, no.
That actually doesn'tapply anymore either.
And after a while I was like.
I don't think youreally need to move.
Yeah.
It's, it's crazy.
But I mean, think about allthe things that have happened
since then from a globalpandemic that, that made the
already, uh, fairly strong pushtowards remote work just become
(02:06):
a thing for, for everybody.
The fact that we're allessentially now Zoom natives,
like right, where, youknow, we're, we're doing
stuff like this on a, on a,a, you know, daily basis,
multiple times a day.
Where it no longer feelsweird, we're more socially
connected via the, thenetworks that we use online
than we ever were before.
Yep.
And so the, I mean, even, evenjust in, since the time that
you and I did this, anotherversion of this podcast
(02:27):
previously, things have changedagain, like significantly
unbelievable.
And so I thought it was worthrevisiting because I, you know,
incidentally wound up revisitingit without even realizing it.
It was really interestingbecause I wasn't even trying to
make the case for not moving.
I was making the opposite case.
Right?
Yeah.
So I was trying to state it.
I just like keptcorrecting myself going,
you know, well actually,
(02:49):
yeah,
yeah, yeah.
But actually, so I thinkwe look at three reasons.
Three, three categories.
Okay.
That startups move.
They move for, becausethey wanna be where
the talent is, right?
Yep.
Which, you know,was always valid.
They move because if, if they'reraising, because they wanna
be where the investors are,and that's pretty specific.
And then the third is theywanna network, they, they
wanna be around other peopleand, you know, grow their
(03:10):
networks in the zeitgeist.
Yeah.
Yeah.
And it's just, what was reallyinteresting is as I looked
at those three, like seminalreasons, you pack your shit and
go, I was like, damn, there'sno way I would do that now.
And it was a great experience.
So I'm not looking at it like,oh my God, it was terrible.
It's amazing.
I, you know, I got, Iraised money from investors.
I hired tons of people.
(03:30):
I, I built a huge network.
Like, uh, I did all the things,but if I had to do it over again
right now, probably wouldn't.
Yeah.
I think there's a differencebetween being a good
experience and it beinga, a necessary thing.
I think we talked to somany founders who are
like, I have to go do this.
I don't want to, but I have to.
And I think that that'sjust, that's, that's
something that we will.
Probably end up dispellingin the next 30 to 45 minutes.
(03:51):
Yeah.
You know, and, and I, Iposted this, uh, yeah.
After I had that conversation,I posted this on Reddit.
Right.
And I, Reddit alwaysfascinates me because
nobody's happy on Reddit.
So if, if I wanna make sureeverybody, like I can get
a complaint from everybody,I post it on Reddit.
Yeah.
It's good place.
And so I posted on Redditand I, I think I was a
little more specific.
I said, is it still worthmoving to San Francisco?
And I wanted to make itspecific to San Francisco
(04:12):
so I didn't get everybodydefending their, their city.
Right.
And, uh, mixed results.
You know, some people werestill adamant like, if you're
gonna build a big company, ithas to be in San Francisco.
And other folks were, I saw someof that conversation though, and
like at least one or two ofthe people were like, yes, you
have to move to San Francisco.
And then when you lookat their location like.
That's not wherethey were though.
So like they're tellingyou you have to go do this,
but they haven't done this.
(04:32):
They're not doing this.
Like, okay, come
on.
I love Reddit.
'cause it's a mixed bag.
You know, it's just a differentversion of social media.
And uh, I posted it thereagain because I knew people
would have strong opinions.
Right on.
Like, if you're on Twitter,if you're on LinkedIn, you
tend to follow people'sopinions that you like.
You know, if you're aDemocrat, you follow
Democrats, you're Republican,you follow Republicans.
But on Reddit, they just tend tothrow everybody in the same room
(04:53):
and you kind of get everything.
So to your point, whatwas interesting about
the conversation, itwas a pretty lively one.
There are still people thatgenuinely believe that, like,
again, this is San Francisco,but I'm using that as a proxy
that believe if, if you're gonnabuild a meaningful company,
it's still in San Francisco.
And there's datato support that.
I, I, I, I think it's a littlebit, I dunno how causal it is.
It's, you know, the biggestcompanies are in San Francisco.
(05:14):
Oh, maybe.
Maybe the, the bestentrepreneurs end up moving
there and build them there.
It doesn't mean thatthey couldn't have
built them elsewhere.
It just means they didn't.
I think it becomesa self-fulfilling
prophecy at some point.
If everybody thinks theyhave to go there to build,
so that everyone goes thereto build, then by nature
of everyone building there,
that's where it's gonna happen.
Right?
Yeah.
It's kind of hard to avoid.
The second part that nobodytalks about is yes, that's
(05:35):
also where people go to fail.
Yeah.
Like far more of themfail in San Francisco
than anywhere else also.
Yeah.
And so, uh,
look, this isn't a everyoneversus San Francisco thing.
I just thought thatwas an interesting, you
know, single data point.
But what was interesting isI feel like if I had posted
that four or five years ago,the number of folks that
said, you've gotta be in sf.
(05:56):
Would be much stronger.
I mean, again, I moved there,so I, I, I clearly like, you
know, believed in that thesis.
I just don't believe init the way I used to.
Not knocking sfit's a great city.
I'm just saying theworld has changed.
So let's talk about it.
Sure.
Let's talk about firstI wanna get to investors
second, if you don't mind.
I, because that's fine.
Not everybody's raising, butwhen people are like, hey,
like you know, I need to move'cause I need access to talent.
(06:17):
Forget SF for a second.
Yeah.
I need to move.
'cause access to talent.
I think you opened it up.
I think remote work.
Put a bullet in that becausewe're not centralized anymore.
It did.
Yeah, so I think the, theidea that you need to be in
a place, in fact it, it's atthis point, like I think five
or six years ago, we couldhave said like maybe we're
pretty close to that line.
Three or four years ago.
I think we could have saidlike, yeah, it probably
(06:38):
doesn't matter right now.
I think it actually matters,but in the opposite direction,
which is to say that if you wereto try to go somewhere and say
you have to come into an office.
Look at how that's going fora lot of companies right now.
So it, it can actuallywork against you if you
move somewhere specificallyto gather humans.
And that kind of doesn't matterwhere it is at this point,
San Francisco or otherwise,you're gonna struggle.
Right?
Right.
It's just not what people want.
(07:00):
It's no longer like, therewas a point at which it
was, it was sort of abenefit or, or a, a perk.
Remember when we, whendid we start doing this?
Will?
2014? Yeah.
2012. Was it that far backwork from home Wednesday?
Yep.
Oh, oh.
Work
from a Wednesday.
Yeah, yeah, yeah.
That was 2014.
2014 work from home Wednesday.
Right.
Which then expanded to workfrom home Wednesday, Friday,
(07:20):
which then expanded toMonday, Wednesday, Friday.
So by the time the pandemichit, we were in the
office two days and Yeah.
Right.
It had already gone.
You know, you and I talkabout this a lot, but yeah.
The minute you makesomething a, a benefit or
a perk for, for people, itvery quickly becomes the
baseline and the expectation.
Now it's just an entitlement.
And like that's everybody.
Now everybody's in thatsame boat where it's like,
I just remote is what?
(07:41):
What do you mean in person?
Well, I think it,it's a few things.
Number one, like Covidbroke the seal, right?
Yeah.
A hundred percent.
Covid basically said,look, the whole world
literally can work remote.
Like you can't make anargument that it can't be done.
Now you can make an argumentand, and plenty of my, my
smart friends have thatsaid, I just prefer to have
everyone in the office.
I get that.
(08:01):
Like, I, I, yeah,the argument's valid.
I'm not saying there isn'ta version where having
people in the office is.
Bad.
Right?
I am.
I'm, I'm saying that, butit's a preference at this.
It's a preference.
You, you don't,
I prefer to havepeople in the office.
Yeah.
Before it was table stakes.
We had an officelike everyone else.
Yeah.
Even though we were only goingto it two days a week, days a
week, still paid the same amountfor the damn office, right?
Yep.
(08:22):
And because of that, therewas an expectation that if
our office was in Columbus,then our team was in Columbus.
And now.
Like it doesn't even occur tome to hire someone in Columbus.
Not being anti Columbus,I'm just saying No, it
just doesn't matter.
Right, right.
You don't have tothink parochial.
That went away completely.
Yeah.
I'm not gonna seethem either way.
Right.
Yeah.
They're gonna be whereverthey can be and it doesn't
(08:44):
work for every company.
I get all that.
Sure.
But, but every companyusually, you know, founders
making these decisions areusually sub 50 people, if
not just the only person.
And if we're talking aboutthe ability to attract talent,
let's say for the first.
10 to 20 to 30 people.
Okay, so we don't get intothis like scaling thing.
I have a hard time believingyou can't build a 30 person
(09:05):
distributed team anywhere.
Yeah.
I, I think it's, it'sactually even easier.
I think that some ofthe challenges with the
distributed team come whenyou surpass that point.
When you're at 50 Yeah.
To a hundred, 150.
There's a point at whichnow making a consistent
company culture becomes alittle bit more difficult.
Absolutely.
But I would argue, yeah, atthe, at the early stages,
it's, it's far easier.
You know what else is easierfrom a talent perspective,
if you have the money,you're not spending on San
(09:27):
Francisco rent to hire them.
Right, right.
Turns out people like thecash, they, they weren't paid
more than, like, it'd be coolto hang out in your, your San
Francisco office and get paidhalf of what I could pay if
you weren't paying that rent.
Or just the other side ofit is a lot of the people
that were in San Franciscodidn't wanna be there.
And again, I'm not picking onSan Francisco, take New York,
take any, any big high pricecity for a very long time.
(09:47):
You had to be in thatcity in order to to, to
get those opportunities.
And Covid really justchanged all of that.
I mean, COVID was awful, butthe one positive that came
out of it is it made us say.
Wait a minute.
I wanna live in Columbus,Ohio, but basically do
a New York City job.
Now you can, no surprises there.
But what I'm saying is a lotof the talent that before
(10:08):
you couldn't get access to.
Yeah.
Because they hadexpected to stay kind of
parochial to their city.
A lot of those people went home.
Right.
A lot of those people wentback to where they came from,
either to raise families orjust to to live, you know,
uh, without 14 roommates.
And I think that goes for miles.
You did it.
We did.
Yep.
We, we've, we've moved quitea bit since the, uh, since
the inception of the business.
But, um, I think that pointis, is extremely valid,
(10:31):
which is that before therewas sort of a, a, a fence
around some of that talent.
Yeah.
And I think at this pointthat fence is absolutely gone.
And it was driven bythe talent, right.
Like they said like, Hey, wedon't wanna be corralled here
anymore than anybody else does.
We saw it like, Isaw it actually.
So if you remember the, thecondo that I owned in Columbus,
I sold to a San Franciscan.
Yeah, it wanted to come backto the Midwest after having
(10:52):
been out there and, and built astartup for a couple of years.
Sold my, uh, house in,in Florida after we left
to somebody leaving,uh, the Bay Area.
It wasn't San Francisco, butthe Bay Area, uh, that wanted
to get outta there and, and,and buy something somewhere
else, like we saw a massiveamount of diaspora after it
became possible, like theminute it became possible,
people started moving around.
It's, it's so funnybecause everyone plays
the same Zillow game.
(11:13):
Yeah.
Like we were living in SanFrancisco and we were, we
were looking, we were, wewere in an apartment at the
time and we were lookingfor a, a home somewhere like
in Palo Alto and, you know,the home price of bananas.
And then you take what youwere gonna spend and ather
in, or where the hell youwere gonna go, and then
you plug it into any othercity you could live in.
Right?
Yep.
And it's, it's like youhave mansion by comparison.
(11:33):
And we did the same whenwe moved to Los Angeles.
You know, we ended upfinding a home in Beverly
Hills, which wasn't ourfirst choice, but that's
just kind where we landed.
And then we started lookingat, 'cause uh, you know, uh,
will, my son was born, wehad to find more room and we
started looking at other homes.
More expensive.
Then we took that sameprice and we looked at you.
Well,
we get anywhere else.
What would that do?
Somewhere else?
Yeah, anywhere else.
Probably
when you're there, youfeel so poor, right?
(11:55):
No matter how well you'vedone, you feel so poor.
Right?
And it doesn't occurto you like, um, you
forget after a while.
Like what that moneycould buy anywhere else,
or more importantly, youdon't need that much money
to live like, like what?
That life doesn'tcost that much.
It only costs thatmuch right here.
And I think peoplefigure that out quickly.
And so I think that that's,it's been nice for people to
(12:15):
be able to decouple themselvesfrom kind of like the life they
want and, and the job they wantand, and then not having to have
those two things magically lineup because they often don't,
um, or they don't, as lifecircumstances change, right.
Like when it was just, I. Youand Sarah, you know, being,
uh, you know, being in, inCalifornia was fantastic.
Like the minute you addtwo more humans, you need
to add at least one more,if not two more bedrooms.
(12:37):
Yep.
All of a sudden it's like,okay, big difference.
This is where we want tobe based on what it would
actually cost us to do this.
And yeah, unfortunately, likewhen that used to be hard coded,
hardwired to the type of workyou wanted to do, you didn't
really have much of a choice.
So you, you had to thenchoose between life and work.
Yep.
Which, look, you know, I, youand I both love what we do
and so like life is kind ofwork for us, but also like.
(13:00):
Work is supposed to serve life.
Yeah.
Right.
And so at the minute whenyou have to start making
trade-offs between the two,the calculus gets really ugly.
Yeah, it does.
And, and you know, the otherside of it though, is again,
moving to a city for talent, wehappen to be entering into an
era where a lot of us don't needas much talent, you know, with
the advent of ai, et cetera.
So the idea of scaling upthe way it used to mean I
(13:22):
raise lots of money and hirelots of bodies, that that's
how you build companies.
Yep.
And now it's like, is it.
I mean, low code, doesit have to be no code
AI fractional hire ondemand service, right?
Yeah.
Man, there's so many otherways to solve those problems.
Yeah.
Yeah.
And then, you know, I, Iheard a quip that I've heard
a million times on thatReddit and that subreddit,
(13:42):
which was, look, if you wannabuild a big company, you,
you have to go to a big city.
Right?
Because, you know, all the bigcompanies are in big cities.
And it's like, look, I get that.
But do you wannabuild a big company?
Yeah.
I mean, like, if you look at itin today's terms, one, if you
have a thousand people, whatthe fuck are they doing all day?
Right, right.
Seriously.
Like, I mean, this is a dumbexample and it, it's probably
(14:03):
works against me, but Ithought it was hilarious.
Like the, the, the, theevent, not the outcome.
When Elon Muskwent into Twitter.
And he fired 90% of the staff.
Yeah.
And that was years ago.
And Twitter is still, is around.
And again, I, I don't wantanybody to lose their job.
So this isn't like,it's not that.
No.
It's just like, hold ona sec. He did get rid
of 90% of the staff.
90% of people.
(14:24):
Yeah.
And the company'sstill around like.
Nothing changed.
Seriously.
What were they doing
all day?
Part of it is predicated onthe fact that like people
have also set their, theirsights on these really wild
and crazy outcomes, whichyou and I have talked about.
Like, like you don't haveto sell a company for a
billion dollars to havea really good lifestyle.
And as you reduce things likestaff counts and costs, you
also don't have to build nearlyas big of a business to just
(14:45):
cash flow really well and, andbuild a stable business and
really enjoy the hell out of it.
That's okay.
Right.
And if you do all this costbaked in, then you kind of
have to build a big business toget to the point where you can
extract as much money from it.
But if you don't needto do those two things,
then just don't.
Right?
Right.
Just build a good businessthat puts cash in your pocket,
pay your teams well, and thensubscribe to the AI services
you need to get it all done.
(15:06):
Well, so which, which bringsus to the next category,
which is investors.
I wanna be clear, I have notseen the same stratification
or diversification ofinvestors by location that
I've seen by talent, et cetera.
Okay.
Yeah.
Now let me unpackthat a little bit.
Part of it is since the startof Covid, like 2021 was a boom
year, you know, one of thegreatest like venture years of
(15:28):
all time IPOs and everythingelse like that, and it went
nuclear winter after that.
Yep.
So part of the reason I'm notseeing like a mass proliferation
of investors, uh, investingeverywhere in every location
because they're not investingin any location anywhere.
Yeah.
They're not investing at all.
Right.
It's, it's been incredibly dry.
So I, I haven'tseen that behavior.
However, what I'm reallyfascinated by, and, and Ryan,
(15:49):
we did an episode on this,uh, not, not, not too long
ago, is how much capitalstartups need in this new era.
Right with, with, witheverything dramatically
changing, particularly talent,that's always the biggest line
item is, is the staffing line.
You know, something that'sreally funny about everything
we talk about here isthat none of it is new.
(16:10):
Everything you're dealingwith right now has been done a
thousand times before you, whichmeans the answer already exists.
You may just not know it.
But that's okay.
That's kind of whatwe're here to do.
We talk about this stuff onthe show, but we actually
solve these problems alldayLong@groups.startups.com.
So if any of this soundsfamiliar, stop guessing
(16:30):
about what to do, let us justgive you the answers to the
test and be done with it.
We, I had a, an interestingdiscussion a couple
weeks ago, uh, that, thatmirrored this, which was.
The idea that people were,there were a group of people
complaining about the fact that,you know, investors are only now
writing checks for profitablecompanies with traction and
customers and all this stuff.
And I'm like, yeah, they wannainvest their money where they
think you're gonna get it back.
(16:51):
Yeah.
Weird.
Huh?
That didn't,
to be fair, investors havealways wanted to invest
in profitable companies.
That's it, right?
Like it's a limited number.
Yeah.
Yeah.
My not full counter, but sortof the yes and or yes, but
the fact that you can actuallyget to those points with a
lot less capital now, right?
Yeah.
Yeah.
It doesn't takenearly as much money.
Right.
It used to take, if you had togo build an entire web platform,
right, and there's gonna be,let's just say conservatively
(17:13):
$250,000 to build that.
Yeah.
You can now build somethingthat would be commensurate
to what you could build fortwo 50, for 25 to 50 now.
Yeah.
So we magnitudes differencein the cost it takes
to get to that point.
So that's part of why investorscan say, we can do that.
And they're not actuallyhamstringing the, the
start of environment.
Like it might soundlike they are.
Yeah.
(17:33):
And, and the other side of itis, you know, investors did do
those, those huge checks, thebillion dollars in 500 engineers
kind of move and it didn'treally back out very often.
Correct.
So, so they kindof got burned too.
Yeah.
But again, sometimes when youtest your thesis and it doesn't
work, you gotta make a new one.
Yeah.
Look, if in today's terms youstill need 500 engineers and I'm
using engineers just to be sure.
(17:53):
Right.
Then I, I'm, I'm really gonnaquestion your efficiency.
I'm gonna question, whatthe hell are you building
with all those people thatyou couldn't be doing with?
That's clearly a sports
league that only hasplayers who are engineers.
Right?
Right.
Can't imagine whatelse would take 500
engineers at this point.
A tiny fraction of ourlistening audiences is out there
looking for tons of engineers.
So I wanna be clear, like,you know, we got plenty of
folks who are doing CPG, whoare doing services business,
(18:15):
who are doing like whatever.
So.
You know, they hear us saythings like that and like
do that, like that doesn'teven remotely apply to me.
And what I'm saying is I getit, but if, if you were packing
your stuff and going, going toBig City, whether it was Boston,
whether it was sf, whetherit was New York, you know,
whatever, in search of capital,to be honest, you generally
had to, and I don't know ifthat's changed dramatically.
Okay.
(18:35):
What has changed is howmuch capital you would need.
Yeah.
To make that trip worth it.
You know, like back whenyou needed $10 million
to do anything meaningfuland there was a time.
You had to go to where there was$10 million and there was like
three cities you could do it.
Now I'm just saying, andyou're saying the same thing,
like the capital requirementsjust aren't nearly what they
were, if any, in some cases.
(18:56):
So the idea of having to,to, to drop everything and,
and, you know, disconnectyour life to get out to the
most expensive cities justisn't what it used to be.
So I, I think.
The need for investorshas gone down.
How much, how much theycare about location.
I don't know how much it'schanged yet, to be honest.
I don't know.
I don't know.
It'll be interesting to see.
Let me ask you ahypothetical here.
I just want to get, get a,uh, crystal ball moment here.
(19:19):
I'm curious what you thinkover the last 10, 15 years
we've watched, you know.
Pre-seed rounds go from25,000 to 2.5 million.
Yeah, you're right.
Right.
Just the funny roundshave gone outta control.
As we start to see less capitalrequired to to launch and
build and grow, do you thinkthat we'll start to see the
round sizes come back down?
(19:39):
Will there be a correctionaround that or will it
just be more money funneledinto less companies with
the same size rounds?
The venture guys have astrong incentive to put
more capital to work.
Because it ain't their money.
That's how theymake their money.
Yeah, yeah, exactly right.
So, so they have a strongincentive for there to be
500 person engineering teams.
Okay.
So I wanna be clear, likefrom their standpoint,
(20:01):
being more capital efficientdoesn't entirely, you
know, jive with them.
And now again, theseare super smart people.
I'm not saying like they,they're trying to waste money.
I'm just saying.
Be clear when they need biggerfunds and they can justify
bigger funds that they getmassive takes from, that
works really well for them.
Sure.
If you were to say, Hey,VCs from this point on, no
(20:22):
startup will ever need morethan five or $10 million,
they'd all go outta business.
So, so again, they stilllike the idea of being able
to put, put money to work.
Of course, they wantstartups to be efficient.
They don't like theidea of burning money.
Right?
And, and look, staffwas the big burn, right?
Absolutely.
Always has been.
'cause it cost a fortune tofind all those people, you
know, think recruiter fees,et cetera, bonuses, whatever.
(20:44):
Then you were always pullingpeople from their last
job to a new job, whichmeant you were paying the
most they've ever made.
Right?
Yep.
So you had to be wildlyand somebody else was
gonna do that to you andpull them to their job.
Absolutely.
Right.
And you gotta pullsomebody else.
Yeah.
It just becomes a cycle.
Building on that.
So as more startups neededmore talent, because that
money was all, you know,getting, uh, foisted onto
all these companies Yep.
To hire more talent.
(21:04):
Market rates were goingup and demand was going
up, fees were going crazy.
Right.
Like it kind offed itself Right.
You know, and inflation oftalent and, and, and cost.
Now all of a sudden,particularly for things
like engineering, where goodengineers and smart people
are always valuable, justa hundred percent, they can
do more than, they could domore as a single unit more.
Yep.
So you just don'tneed as many of them.
(21:27):
That's a big change.
Dramatically changes the capitalrequirements to get to the same
point within a startup company.
You bet.
You bet.
There was also, again,all these things kind
of have a ripple effect.
There was also a notion,let's say in 2021, in like
the, the height of the go-go.
That was our 1999of, of recency.
Yeah.
There was a notion that in orderto look like you needed more
capital and to be valuable, youhad to hire a lot of people.
(21:49):
If I go out and I say, I, Ineed a $300 million round 'cause
I need to hire so many people'cause we're growing so fast.
That was a strong signal.
That's exactly what investorslook for to say yes.
A company with, with thoseambitions and that momentum.
That's where I, I wanna parkcash and, and there's all kinds
of good reasons to believe that.
Now, but since so manycompanies, VCs got
burned by doing that.
(22:10):
Yeah.
And, and not just VCs, youknow, it goes down the line
to angel investors Sure.
Et cetera.
Where all it starts.
Now there's a version where atleast they're like, you know,
that didn't work out so well.
Yeah.
Like, we kind of got crushedacross the portfolio.
So how about we not dothat again and kinda
look, look at how, howcan we be more efficient?
How much do you thinktechnology's played
a role in this too?
I mean, like, yeah,they may still prefer to
(22:32):
invest somewhat parochial.
Like I, I don't, I don'thave a strong thesis around
that, but certainly likeeverybody's comfort level.
Like, well, you know, 2015you packed your bags and
you went and found investorsin 2025, we hop on a
Zoom and we do the pitch.
Right.
In fact, I know a lot of peoplethat just prefer that, right?
I don't want somebody walksinto your office with a
really bad pitch, likeyou're stuck with them.
(22:53):
Oh God.
It's like an how many, howmany, how many investor offices
had to tolerate you and Elliotsitting in the, in the, in
the waiting rooms, uh, eatingpizza, waiting for your,
your partner pitches, right?
So like, at some point it's waymore efficient for them too.
It is, and again, investment'sbeen slow, so I don't think
we're really gonna see whatthe appetite is for going
outside your parochialbubble, so to speak.
(23:15):
Yeah.
Uh, until we see the, the nextbig, like, you know, kind of
go-go moment of investing,but by the time that happens,
let's say it's a few yearsoff, you know, where things
kind of really do cycle up bythe time that happens again.
Again, with the advent of ai,of fractional, of remote, et
cetera, you're just gonna havea very different climate for
what people need than they didnow, because before we were all
(23:36):
raising money to hire people.
Yes, there was.
There were marketing budgets,but those scale with the
growth of our product, itwas hire this massive staff
and hope it works out.
Which, so let's go to thethird category though, where
I wanna go to a big city.
Because I, I want thenetworking opportunities and
Ryan, I, I wanna split this.
There's no questionthat going to a big city
again, we're talking aboutlocation, that going to a
big city is gonna open youup to more opportunities.
(23:58):
You're about to move to a bigcity for exactly this reason,
for your whole family, right?
Exactly.
Yeah.
How do you justify it?
Because it's, it's gonnacost way more where you're
going than where you are now.
Well, we did the, we didthe calculus on it, right?
Like there are specificthings that are missing in
our current geography, right?
From a family perspective,there's things, I don't think
everybody knows where you are.
Uh, so we're, we're currentlyin Antigua, Guatemala, right?
And we're getting ready tohead to Madrid, Spain, which
(24:20):
are, uh, about, you know,polar opposites, right?
We've got.
30,000 people here.
There were 30,000 peoplein the, in the block that
we stayed in over thesummer, uh, in, in Madrid.
Right, right.
So complete different accessto things like culture and
arts and, and organizedsports and schools and just
all kinds of other stuff.
And then all the accessto all of Europe.
So in our case, this isvery much a taking advantage
(24:42):
of the fact that work isdecoupled from life and that
life can happen where itneeds to happen in order to.
Deliver what we, what we want.
So as we do the plus minus,yeah, there are lots of costs
involved in the move, butaccording to the calculus,
we performed the benefits.
Far outweigh that.
Right?
You bet.
And we're, we're, we're movingbecause we want to, not because
we feel like we need to, sowe're running towards something,
not away from something or the,I mean, I guess we are still,
(25:04):
we're running away from thelack of, of resources here.
So for us, we're looking atthis going, this is 2015.
In a lot of ways, like we cannotget, we can't replace some of
the stuff that, that we canget digitally now that we want.
Right.
And so we're, we're in aposition where it does make
sense to, to pack up and go,
you know, it's, it'sinteresting to me is that
when I moved to, uh, to LosAngeles and to San Francisco,
(25:25):
as you remember, I was.
Like Johnny Networker,like, like I, I was, you
know, in, in five to sevenmeetings a day when I first
moved to Los Angeles, to,um, Santa Monica, I hosted
over a thousand people Yeah.
At my place, right?
Yeah.
Uh, I mean, unbelievable numbersof people as far as networking
and meeting people, right?
So, clearly I was a verystrong believer in the
(25:46):
networking opportunities,and it was awesome.
Now, a few things that, youknow, that, that I, I wanna.
Put together, number one,if you go to a bigger city,
and that's most of whatwe're talking about here.
If you go to a bigger city,just like you said with
Madrid, you are going tobe exposed to more stuff.
A hundred percent you'regoing to meet more people.
I said like the folks inLA or the folks in San
(26:06):
Francisco as an example,paid a fortune to live there.
Yeah.
So by definition they were alllike, nobody was complacent,
like everybody was therebecause trying to take advantage
of it, they worked their asoff to be there for we had.
Yeah, yeah, yeah.
And I like that vibe right now.
Once you got past thatthough, like let's say
you're living in New York,you live in San Francisco,
you're also like, this isa really small apartment.
(26:27):
I mean, LA is the same thing.
This is a really small apartmentand my quality of life sucks
depending on what you wantyour quality of life to be.
Now, all that said, what itwas really about is you didn't
have a way to find or me.
Any of these people, unless youwent to those cities that just,
you couldn't do it otherwise.
Like the other version ofpeople, like, oh, I'd meet
people at conferences.
(26:47):
I've been to amillion conferences.
I'm the most outgoingperson I know.
I've never been to a conferencethat I thought was worthwhile.
Like ever, ever in 30 years.
Right?
Yeah.
It's always
the biggest waste of time.
It's always the thethe, the thing, right?
Like, oh, I'm gonna go,I'm gonna make, you know,
everybody that I need toknow is gonna be there.
Cool.
Are you actuallygonna talk to them?
Are you gonna make meaningfulconnection with them?
Oh my god.
Ships passing in the night.
Right?
Yeah.
I think that's, there'ssomething else that's
(27:08):
interesting there, and I thinkwe can talk about like how
much that's changed now and theother ways that it's changed.
But like one of the things thatthat always struck me was, and
then sure, there are lots ofpeople there, but one of the
things that ended up happeninganytime I've been in a bigger
city was that it felt like.
Less of it was in my control.
Right.
And there was just alot of osmotic impact.
Yep.
Some of which endedup being good.
(27:29):
Some of it wasn't.
You bet.
Right.
Some of it was just, it endsup just being time draining.
Time wasting.
Right.
Because everybody, because atsome point like that you have
marketable things that peoplewanna talk about too, too.
It's not just about what you'regonna take from the networks,
but what you're gonna give.
Um, and I found that there wasoften an imbalance in that for
me, and, and that it made me.
A little less deliberate.
Like at some point when you're,when you're in the fish or
(27:51):
in the barrel with the fish,you're, you become a little
less picky around like whoyou're interacting with.
Whereas now that's a five.
We've got LinkedIn, right?
We've got plenty ofother social media.
We've got social mediaX, we've got all of it.
It's crazy.
Talk to anybody.
I want to anytime I want to
because that'sbecome such a thing.
Yeah, I think two thingshave happened for me.
One, I meet 10 x more peoplenow than I ever met before and
(28:14):
again, and I was doing likefive to seven in person meetings
where I would reach out topeople to get to sit down with
them for no purpose, by theway, just to get to know them.
And it was.
Exhausting, right?
Probably.
Yeah.
So for them, uh, but,but my point is, it's
exactly what you said.
I could only meet withthe people that happen
to be in my geography orthat I would bump into.
Okay.
Yeah.
(28:34):
And I tried to, you know,create as many opportunities
for that to happen.
I met great people.
However, when it comesto who do I need to meet,
like professionally.
I can DM anybodyright now, anybody.
Right.
Like it blows my mind.
And, and it also happensthat like when I DM somebody
that I really need to meetthe probability anymore that
they're in LA or San Franciscoor where I would've otherwise
(28:54):
been is damn near zero.
Yeah, right.
It is not zero
because again, there's still,you know, more people there.
But like for some reason, thefirst person that comes to
mind, not that I, I'm tryingto meet, but I was DMing
with recently, is Dan Martel.
Uh, right.
And Dan, I'm not knockinghis location, but is in BFE
Canada, if I recall right.
Moncton, I think iswhat it's called.
(29:16):
And I love that.
I love that because likeDan just hit a million
YouTube subscribers.
Right.
You know, he's JohnnySocial now, but he is in
Moncton, Canada, dude.
Yeah, right.
Like Dan wouldn't have been ableto meet anyone 15 years ago.
In Moncton Canada.
Well, to be fair, Moncton isknown as the San Francisco
of absolutely nowhere.
It's not,
(29:38):
this is me giving Dan ashout out, by the way.
Um, I, I, I make sure it comesout the right way because Dan
in Moncton can be the mostpopular person, uh, in business.
Anywhere he wants, anywhere hewants doesn't matter right now.
Again, I had to do that samething with an ungodly amount
of physical effort within-person events, et cetera.
(29:58):
And Dan's doing it withouteven leaving his hometown.
What I'm saying is that levelof connectivity just didn't
exist at the level it does now.
No, even remotely.
Something else is funnyabout that, right?
Like the fact that we, wehave this digital, like on
one hand it's a lot easierto just reach out digitally.
I don't know how it was for you.
But, and, and maybe thisis even, I'm, I'm, now I'm
trying to figure out, thisis like more of like a post
(30:20):
pandemic kind of thing.
When I do get in-personintroductions, not in-person
introductions, but maybelike somebody local, like,
Hey, somebody here thatwants to sit down with you.
I almost always say yes.
Part of that might just be therarity, but part of it's kinda
like it feels rude to say no.
Yep.
Whereas.
With digital outreach,I think it forces people
to be a little bit moredeliberate, a little bit more
polished in the outreach,A little more purposeful.
(30:42):
Whereas like before peoplecould just reach out and
be like, Hey, you know,I'm, I'm gonna be in town.
Would you like to get together?
Like,
yeah.
Okay.
Right.
Yeah.
Whereas if somebody reachedout to me on LinkedIn, they're
like, Hey, do you need offshoreweb development services for an
app that you're not building?
No, I don't.
Right.
I don't have tospend time on that.
And so like, I think it'ssomehow by being digital,
despite the fact that wehave this ability to reach
(31:02):
anybody, it's raised the bara little bit for what that
communication looks like.
I actually appreciate it a lot.
Pointing to Dan for a second.
What I'm saying is Dan hasa massive profile Yeah.
In Moncton, uh, you know,sitting in Moncton, Canada.
Right.
I'm just saying that's possible.
Whereas it wasn't before.
Again, this isn't the sameas like if I was 27 years
(31:22):
old and someone was like,Hey, you should move to
New York, or you know, SanFrancisco or something.
I would do it right becauseit would cost me nothing.
It'd buy me a ton.
Great big city experience.
I did it.
It was awesome.
What I'm saying is nowI just wouldn't have to
before you have to, I hadto, I didn't have a choice.
Yeah, right.
Now I just don't have to.
And that's a big deal.
(31:43):
You don't have to moveto San Francisco to,
to, to find work, right?
Yeah.
Like you can go
anywhere when Yeah.
I think the minute it wentfrom being a prerequisite to a
nice to have, if I want to haveit, maybe not even a nice to
have, it's a a if you want it.
Right.
It became completelydiscretionary.
That was super powerfulin, in so many ways.
Right.
(32:03):
Look like we've, we've talkedabout a lot of stuff like there,
there are still some advantages.
Of course there are, right,there are advantages like
things like you mentioned,these serendipitous meetings
and cultural immersion,some of the stuff that
I'm moving for, right?
But the, but the cost benefithas certainly shifted and I
think it's no longer a caseof, of necessity and, and
more, more like one of desire.
(32:24):
But the other side ofit is you're, you're
not moving for work.
Yeah.
Also that a hundred percent.
Yeah.
I mean, that, that'sdramatically different.
You're saying, I wannago have these experiences
in this other place.
Yep.
Now, if, if you guyswere, you know, super into
skiing, you might be goingto Provo, Utah, right?
Yes.
Like, right, like there mightbe a totally different outcome.
You guys have an amazing,uh, ability as a family
(32:44):
to ingratiate yourself inthe local culture and, and
pull so much from that.
But it has nothingto do with your job.
No.
Nothing.
Right?
Nothing whatsoever.
Now there will be benefits.
In fact, we've gone, we've gonethrough some of that recently
because there was then this,this kind of toss up between
Madrid and possibly Valencia,which gets us on a coast.
And there was some other, it's alittle bit smaller, a little bit
maybe easier to, to end up in.
And then we went backto it like, but why are
(33:06):
we actually doing this?
Right?
And a big part of it is forsome of that bigger city stuff.
And for me, from a workperspective, there are some,
there are some pluses to Madrid.
It's a much biggercommercial center.
There are way more startupsthere than there were
going to be in Valencia.
Are there as many asthere are in, in San
Francisco or New York?
No.
But it's still from whereI am now, it's gonna
be a massive increase.
And so there will be benefits,but is again, but it's
(33:26):
not, we don't have to makethe choice based on that.
Again, it's, it's not, andthat's really what we're
saying is isn't relevant.
Right.
It's just a
lot less relevant than it was.
It's changed from ayou have to do it.
Mm. It could benefitin certain ways.
Yeah.
Like when Sarah and I movedto San Francisco, you know,
I certainly had a, a singleunified goal, which was, at the
time we were buying companiesand most of the companies we
(33:48):
were looking to buy were there.
And it worked outgreat, you know?
Yep.
It, it, it really worked out.
But from Sarah's perspective,you know, uh, my daughter Summer
had just been born, I thinkshe was five or so at the time.
She just wanted an adventure.
She was like, Hey, cool.
This is justsomething new, right.
I don't, something fun,something different.
Yeah.
The commercial aspect doesn'tmatter to me, and she got
to explore it, et cetera.
After a while, shewas like, guess what?
This city's terrifying.
(34:09):
Yeah.
I've seen it all.
No cross.
You can cross it an hour.
And I've seen it all.
I'm good.
It's the part they don't putin the brochure, but you know,
Sarah would, would, wouldleave our building, uh, with
a five-year-old in a stroller.
It would not go well.
It was, it was a very dangerousplace for a woman in her.
A little tiny daughter tobe walking around there.
There's reason you don't seeany kids in San Francisco.
(34:32):
Yes.
They're all adults anyway.
Um, this wasn't aknock on San Francisco.
I'm just saying like if she wasgoing for her own reasons, she
would've been out very quickly.
Yeah.
I would go there and, and Iwould put up with whatever,
because I needed to be there.
But now I wouldn'teven consider it.
I was like, yeah, Iwould never do that.
Not knocking San Francisco.
I'd go there for fun.
Right.
But if we're like, oh, ourbusiness has to be there, I'm
(34:52):
like, no, no, it does not,
does
not, does not need to be
there.
Yeah.
Yeah.
I, I think it's so interestingtoo that like, at this point,
because of this, this shift in,in like the, the value of the,
sort of the, the perks of beingin the traditional hubs, right?
That the value.
Of the flexibility has actuallygone up so much, right?
(35:13):
Yep.
Now that you really kindof can, I think there were
so many things that peopledidn't even consider before.
It just didn't, itdidn't occur to people.
They could just bewherever they wanted.
Yep.
And still do the thingthat they wanted to do.
And I think that is, in as muchas the value of the traditional
hub and what you get from ithas gone down to some degree.
I think that the, the biggerimbalance has actually been
created by the value of beingable to do what you want can
(35:36):
anywhere you want, has actuallygone up so significantly.
And I think that for me is whathas absolutely made it really
hard to say that like there's ahuge benefit in being, or that
a, the success of a startupis predicated on being in
some, somewhere very specific.
I'd say the flexibility tobe anywhere for me at least.
I, a lot of people that we know,uh, would far outweigh the, the
(35:57):
perks of the traditional hub.
Yeah.
So look, I, I think what,what we're saying isn't that
cities don't have their value.
Cities have value.
We love cities, right?
We've lived in them.
What we're saying is in thisday and age, you would be hard
pressed to make an argumentthat says you have to relocate
to a major city or a specificlocation in order for your
startup to be successful.
(36:18):
The, the truth is there are somany things that have changed
so dramatically that you cantake advantage of that you
just don't need to do it.
So I would say at thispoint, when somebody asks
you that question to say.
Hey, where's your startup based?
Your answer is whereverthe hell we want it to be.
And I'm damn okay with that
overthinking your startupbecause you're going it alone.
You don't have to, and honestly,you shouldn't because instead,
(36:39):
you can learn directly frompeers who've been in your shoes.
Connect with bootstrappedfounders and the advisors
helping them win in thestartups.com community.
Check out the startups.comcommunity@www.startups.com
to see if it's for you.
Could be just thething you need.
I hope to see you inside.
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