This is the conclusion of Episode 3 of Smart Bear Live; see the original post for details and the first half.

You can listen by subscribing to my podcast on iTunes, or it’s enclosed in this blog’s RSS feed, or you can just download the mp3 of the first hour.

Why listen? Especially if you don’t normally listen to podcasts? Because then you’d miss out on:

Whether it’s better experience to build a complete, tiny startup or to do more in-depth customer development for a meatier problem.
How to move from a free to a paid product without losing all your users
How to differentiate yourself in a crowded market (and when perhaps you shouldn’t try)
How cofounders can collaborate without going crazy
Why you need to focus on a specific niche, especially in a field with dominant players like CRM
When you don’t need to pursue outside funding and how to deal with people who insist you do

Here are the companies who called in:

If you have feedback and advice for the companies on the call, or feedback for me about the show itself, please leave a note in the comments!

Transcript

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Patrick: Hi, Noel.

Noel: Am I live?

Patrick: You are on and this is going to be a tough one, Jason. I see the name of Noel’s company. Why don’t you give Jason the name of your company or your URL?

Noel: Creativeriot.com. C-R-E-A-T-I-V-E R-I-O-T.

Patrick: Creative Riot.

Jason: Creativeriot.com that’s great. So, Riot is a big crowd that is all mad. It’s also something that is super funny and something that’s creative and funny sounds good. No matter what the subject matter is. I hope that’s what it is. So I hope that’s what it is. I hope it’s a bunch of crazy, funny people who are going to write blog post and another content for you. So that you can pretend like you have a good personality.

Noel: Unfortunately, we thought of anything but that. We’re an integrate from that company but we had a lot of regret in hindsight when it came with the name that we picked. But we managed to grow a few customers, so that’s good, in spite of the name.

Jason: There you go. So what do you do?

Noel: Well, what we’ve been doing thus far is what I wanted to talk with you today.

Jason: OK. Go ahead. What’s your question then?

Noel: So we been looking on enterprise power management tool. We been managing the field by plan more than 75 enterprise customers and channel partners. And we face pretty much the same problem that your Mark just articulated. The very same stuff you were discussing. The whole problem of managing so much activity, the over head that were using. Separate item, actually maintaining that, making sure the data never gets stale, constantly staying in sync, making sure that there are two redundant cycles on the one hand. You are coordinating customers by email. On the other hand, you are attract activity by the CRM. You need to actually put in that process in place to make sure that the two really sync, putting accountability process in place. Those are the things that we have to do, and that’s what email for. And I would believe that this problem extends to resonates with a lot of people.

So we thought, why not catch that on edge? And we try CRM inbox, that’s what I want to try and validate today. It’s essentially a one length page. It’s intended to be un-repetitive. A little contextual, that lives inside Gmail. That really gets out of the way, when you don’t have to use it. That helps you get more context, when you are looking at the mail. Or in a sense full blown, stand alone CRM that resides right inside the e-mail.

Actually to give you a better feel of what it looks like. I’m just posting a URL to a screen shot in the chat feed

Jason: So I’ve seen these tool before, these kind of thing’s been around forever. There are Microsoft outlook addo-ns that do exactly like this. Lot of CRM tools on the desktop integrate with e-mail indirectly by embed e-mail inside. There are things you can get for sales force if you use salesforce.com. There are addo-ns you can get to do this.

So it’s very common to do this and just ‘have the context’. But your CRM already have the context and it’s easy to have, to connect your e-mails, to CRM. If it’s not, you have to pick a CRM that is easy to integrate e-mails with it, of course.

So even stuff like the free SugarCRM has pretty easy way to integrate e-mail and jump around between there. So I guess I want to know is, why are you not using one of the other things and what’s insufficient about them because, it just seemed like the sort of typical thing that CRMs do.

Noel: Well, there’s a tons of CRM. Everything from Highrise to Factory to Sugar, to Insightly, which is a Google apps CRM. The one thing we found really hard to do was sync between the e-mail and the CRM. Most CRM don’t want to be this one side where you actually spend most of your time in. And they give you the ability to embed the e-mail, either forwarding e-mail to the CRM or in the case of Google, they actually let you, dispatch e-mail from CRM as well, so it double as e-mail, too.

But a lot of businesses, and we found that we do it ourselves. They can spend a lot of time, lot of people spend most of their time in the inbox. That’s what we observed in our case. And we found that we are always struggling to context, when people are writing mail, when people are reading mail from a customer. And as I mentioned earlier, there was a huge context searching over head when we switched between your e-mail and the CRM.

And it was essentially too redundant [inaudible] they don’t even have to sync with each other. And this is why we thought if there were, you know, a little contextual widgit that live in inside of Gmail that it would essentially make updating the CRM so much easier because you can do it on the fly, and you can access the data whenever you want it.

Jason: So you didn’t mention the most popular CRM on earth which is salesforce.com and which does this. You can setup an automatic two-way sync between Gmail, and in fact, even a chat inside Gmail and salesforce. You can send e-mails through Gmail if you want. You can also do it through Outlook for people who are doing that. OK. So if you don’t want to use salesforce.com ‘cos I agree that Highrise recently do this. Like, I’m still trying to figure out what the situation is and also, like, you do want all of your e-mail to be mirrored inside the CRM. You don’t want those threads happening outside as what we just discussed. So, assuming, that they are all out mirrored in there, I guess, I’m still kind of trying to figure out, maybe, it’s because you’re thinking that you don’t use salesforce.com, but you’re using something else that doesn’t have as good integration?

Noel: Yes, so, essentially there is two distinct kind of potential customers that we’re looking at. On the one hand, we’re looking at, you know, the Fortune 5,000,000 [inaudible] small teams, small businesses like us, they’re probably using a small business CRM like Highrise or the free version of Sugar. Those tools do not integrate as seamlessly with e-mail as advertised. We’ve tried it. We’ve been through, you know, been down that route before, and it’s a messy process. I mean, it’s not as simple as it seems.

We just wanted a very simple way to actually, you know, track data, update that, you know, added that, force an update, have a little stream of information. Actually, the screen shot doesn’t have an update section that [inaudible] but, you know, when you actually start posting update, it doubles up as a little stream of information as well. So just keep us stepping on the same page, you know, without that whole context of using overhead.

On the other hand, at the other end of the spectrum, there are the larger enterprise customers that are using salesforce. And for a customer like this, we thought we envisioned it as being a bridge between their inbox and salesforce. So it becomes very easy to actually update salesforce while spending most of your time in the inbox.

The height of [inaudible] a lot of users spend of the time in the inbox. In fact, [inaudible] most of themselves have a little salesforce gadget, you know, [inaudible]

Jason: Yeah, I think we need to do is to decide on who your target audience and actually talk to some of them with the screen shot and see what they think. First of all, the enterprise level processes and the one like you described, where there is one or two people just trying to do basic sales with Highrise, extremely different context that they operate in, and different price points, by the way.

So, for example, if you’re in a company with a thousand sales people, using salesforce, I also guarantee you they are not using Gmail. The company does not use Gmail. They have other e- mail system and it’s actually not that hard to have it go into salesforce. And if they have a team that big, they also can make the e-mail go into salesforce. Also, companies like that just through process they get the e-mail in, just by forcing them to do so.

So I get it more on the lower end where you don’t have much process, you’re just trying to coordinate and not lose track of stuff, and speed is interesting and you don’t have a complex situation. I get that a lot better. There is also a lot of choices. I mean, there is a lot of different kinds of, like, pseudo CRMs people use. You know, you could use a lot of ticketing systems as a CRM if you’re on the low end like that, actually.

And so, I think it would help you to actually talk to people who might need this. And another thing I would ask, you should ask yourself is, are you a bridge or are you a CRM? The more you are bridge I get it a lot more. So in other words, if it’s you’re little side bar there that integrates with Highrise, that integrates with the Sugar, so that you already have a CRM anyway, it’s very easy to acquire one these free or cheap CRMs, what you’re doing is making the e-mail bridge, which is two-way, really really good where you don’t have to worry about forwarding e-mails in, and you have the contacts right there. It’s very easy to switch between the two, and you’re the bridge. That, to me, starts to make a lot more sense because like you said those lower end tools are not a very good bridge and I could see you bridging Yahoo! Mail, which by the way is bigger than Gmail. Us techies don’t realize that all the time, but Yahoo! Mail is still several times bigger than Gmail in a number of active accounts; or Outlook, or something like that.

But, again, I would question, do you need another CRM? Like, Is sugar not sufficient in terms of basic functionality for a small team? Is Highrise not sufficient for a simple team? It probably is. If the problem is email integration then redoing a CRM is probably not the most necessary part of the solution. That’s just me kind of rambling a little on what seems a little more interesting or at least different for me.

Everybody, I think, would rather eat a gun than have another goddamn CRM. Fixing a bridge between a tool like Gmail that you love and your CRM which is sufficient, and just fixing that bridge and fixing is for lower end people who don’t have as many of those tools and processes in place. That sounds better, but even so I would ask what people would pay for them. On the low end those CRMs are often very inexpensive.

One of the things I found is that if you have an add-on to something, it’s very hard to charge a fraction of what the something is. At Smart Bear we were selling a code review tool, and if you paid $600 for Perforce, it was very hard for me to charge $600 hundred for an add-on to Perforce that did code review. They expected it to be a lot less, like $100. It was a while before our tool was so sophisticated and so feature rich that it was seen as a stand alone, and visa versa, that Perforce was an integration into us as opposed as sort of an add-on.

So I would also caution if you are going into the add-on world, which I think makes since, that you look at the prices of Highrise. Realize that’s certainly a cap on what you could charge, and probably you have to charge a lot less and then is it still and interesting project? I’ll let Bob comment on it, too.

Bob: I think part of the problem here is that we’re treating CRM as some sort of cabbage, or maybe a potato, or carrot. Another words they are basically the same thing, and that’s anything but the case if you look at just the evolving history of CRM, social CRMs, all the variations of the CRM idea. I think where you’ll find some place to stand and make money, Noel, is to dive deeper into this question of what is a CRM and what people want. That idea may be in a different format when they’re in Gmail. Gmail is kind of one end of the road. What is a CRM for the people in Gmail that we want to have as our customers is the other end of the road.

I’m not at all convinced that any one CRM is the end all. It’s like GTD products. There’s hundreds, upon hundreds, well now that we’re mobile, 1000s upon 1000s of GTD applications out there. Each one starts from a different place and a different definition of that. I think that’s where you can get some value. Differentiate yourself from the existing solutions out there, be they sales force or base cap or all the others, and start attracting people that need that you’re fulfilling at a core level with your interpretation of what a CRM needs to do. Do that make some since?

Noel: Yes, absolutely.

Jason: So another thing is that whatever you decide to do, maybe it’s a bridge, it sounds like maybe you need to do a little more market research. The fact that you didn’t even mention sales force is interesting. Even small teams, by the way, use salesforce because they have some affordable stuff on the low end.

Also for Highrise they have Gmail gadget. If you look at the screen shot it’s not that much different from yours. You can see the email thread and right in there you can see these little tabs that show in Highrise the people and tasks and deals and so on that are associated with that. Which is exactly like yours. Now that’s not to say yours isn’t better and it can have more and you have a vision for what else it could do, so I don’t mean that to mean you shouldn’t do it. Only that what is in your screen shot is basically already there in Highrise, for Highrise for example, I’m not sure about Sugar. It’s also there for salesforce.

I think A, you need to decide who your potential audience is, just like Bob said. There’s lots of use cases, lots of kinds of people. It’s not true that one tool fits all. You’ve got to decide where your sweet spot is where you think you could add value. Do a little bit of competitive analysis, literally just see what’s out there, et al, and then try it out and then actually go and show people the screen shot and say hey do you want this or do you want it over these other things.

Finally, how much do you think you really could charge for this and incorporate that into that customer development and make sure that that segment also is willing to pay for it.

Q: I’d like to just suggest one other thing. I would suggest you go back to the root of what you’ve got here with creative riot. I think that’s a great term, but enterprise, creative and riot are three words that do not go together, so why not think about this in terms of what a creative bunch of people might want from a CRM, and think about well, maybe we can go in this direction. You’ve got some of the mechanics out of the way. Is there a reason that you’re wedded to the enterprise market other than the misconception that that’s where all the money is?

A: No. It’s more that the product we’re working on was born out of a project that we were working on while we were going to college. It then hit the market, which happened to be the enterprise market. We were not under any delusions. We knew it was going to be really hard. Why not take a stab?

Q: Enterprise by definition is settled law. Any company that’s gotten that big has a definite way of doing things and a definite way of deciding what new things they’re going to do. Why not go for something that’s a little more edgy on the edges of the economy? For instance, how do creatives with an agency deal with freelancers? I know there are several different solutions out there, but there’s no way near the homogeny that you see with salesforce.

I think there are other areas on the edge where we’re talking about new types of relationships of people who are using email generically, but have a specific viewpoint of the world. That’s where you can get some quick and early traction. After you’ve organized all the global ad agencies in the world, then you can go after Enterprise once you’ve got that market down.

A: All right. I guess we have to try and identify a niche that can be a sweet spot to actually [??].

Q: I would decide what that niche is and that way you can talk to people in that niche and make sure that their world view and viewpoint on this stuff matches yours. I also think there’s a lot of lack of knowledge in this area. In other words, a lot of people use Highrise and don’t realize that there’s 100 integrations to Highrise on another page at 37signals or a tech friend of theirs set them up with Sugar CRM and they just sort of click around and don’t even know what’s available.

That’s also potentially in your favor in a sense that you could make something that’s not materially different from a lot of things out there and still have a product, on the other hand it’s hard to reach those people, i.e., through marketing and so forth and it’s not clear again, that they’ll give you a lot of money. I think we’re still back to pick your niche, pick what you’re doing.

What’s the vision? Another thing about this vision is if this bridge between Highrise and Gmail is the product idea, how far can you take that? Besides just showing data from one system to another, what else can you do? If you can’t think of that many things to do then that’s not that interesting of a product because it goes, it stops, you can only charge so much. Various CRMs may add this kind of thing in as a feature anyway. Whereas if your head explodes with the different things you could potentially do and it just becomes more and more interesting then you could start with something that again is maybe even given away for free by the CRM system knowing that you’re going to do this part better and you’ve got all these legs in it and you’re going to produce something amazing over time. That would sound pretty interesting too. It’s not clear from the screen shot if that’s the case but these are things to ask yourself.

Noel: Actually we did have a few ideas in play. The larger vision for it is just enhancing the inbox and also trying to tear down the silos between the difference [inaudible] Google apps on the one hand and several other [inaudible] manage a variety of business processes. So while the abstraction shown is a failed CRM, this could just as easily be applied to a ticketing management widget. Again, it could be standalone or it could integrate with [inaudible]

This could also potentially be extended to a theme collaboration or status update, too. As we see it we think there’s a whole variety of features that we can actually integrate and that this one widget will provide ranging from attachment indexing and e- mail archival. There’s so much more; a whole list of features. But we’re just trying to build that minimum viable product and see if that excites people because if that’s a non-starter then I think we’re getting ahead of ourselves.

Patrick: CRM is a very rich space with a lot of different players in it as we’re talking about finding that niche I’m reminded of a company in Chicago that makes a rich CRM product that works more with Microsoft products where the focus is on the professionals. High value professionals like lawyers who have their own contacts that are important to them yet they integrate with a law firm.

Companies like this, first of all, have money so it’s a rich space. But it’s interesting to look at something that exists on one platform and then say, ‘That company has succeeded on that platform. I want to work on this platform. Maybe I can do something similar over here.’ That works in both directions. If there’s something that exists on Google that’s not in Outlook that’s an opportunity. If you want to do market research look at all the niche CRM companies out there. If it’s on another platform, bring it to the one you prefer. Or at least get ideas to see where the gaps are and what the scope of the gaps people are filling.

Noel: Actually though we spent a really great deal of time researching a wide variety of niche CRMs, as well as the main stream ones. I was going to mention sales force as well but I thought I’d save that for the latter part of the conversation because talking [inaudible] bridge would be a bit of a departure. We think maybe [inaudible] small differences.

But, yes, and we’ve seen a lot of these contextual widgets, similar ones, [inaudible] on the one hand and little widgets that have been plug ins a lot of them tend to very context centric. We tried a lot of them but they don’t seem to quite cut it. They don’t have that one stream of updates that keeps me updated.

If I’m looking at a particular account for instance and I wonder what’s the latest that’s happened, who’s responsible, what are the next task that we need to [inaudible] so that we can move ahead with this account? Who are the people involved? Can I get a little more contextual information on all the other people involved in this account? Do I have to go to the CRM and [inaudible] 20 tabs to do this; that’s really painful. It’s five clicks for each of those things. I’m trying to eliminate that pain.

Patrick: Thank you so much for calling. Sorry to have to cut you off a little bit but we have one more caller left. Thank you so much for calling and please call in next time and keep us posted on how you’re coming. Melissa, can you hear us?

Melissa: I can. Can you hear me?

Patrick: I can hear you, Melissa. Welcome. Another friend of mine. I love talking to friendly voices on this show. Thanks for coming in.

Melissa: Always a pleasure to talk to you, Patrick.

Patrick: Thanks Melissa. OK. The name game. In your particular case, let’s even cheat a little bit, just say the name of your company, not the URL.

Melissa: Booker.

Patrick: You get that, Jason? Booker.

Jason: That’s not what I first thought you said but OK. When I think of a booker, I think of something that schedules. So, I’m thinking it’s a scheduling app and one of the things, it seems that everyone’s got this problem, and no one seems to have solved it for some reason. A person needs to have a bunch of clients, or potential clients they may not even know, book stuff with them, because they’re a masseuse and they have slots to fill, or they’re just a busy person and they have office hours. They want to have just enough control where they can say things like, ‘Well I need 15 minutes in between things to do whatever.’ It integrates with their existing calendar, so it blocks out other things that they proactively put on. Basically, it’s a hands-free way for people to schedule with them, kind of like Tungle [SP], except this time done in a simple way that makes sense. That’s what I think it is.

Melissa: You nailed it.

Jason: Woo. Really?

Melissa: That’s exactly what it is. I actually had this problem. I would work full-time making software all day, and at night I would go home and give ski instructions here in Michigan. I had this huge pain of being able to schedule my lessons, and I taught for 150 instructors. It’s a big pain, and it’s a big industry. It’s frustrating because the workforce changes. The manufacturing economy really shook things up when it collapsed. We’re seeing a lot of the workforce change as we go into service businesses. So, there’s more and more of these service businesses that are centered around appointment booking and they’re run a lot by women, but women still take over a lot of the necessity of taking care of appointments and running the household schedule. So they’re trying to book things that they need to do for their family or for themselves, and they’re trying to do it at 10:00 at night when the receptionist is no longer answering the phone at the business.

There’s a ton of nuances and a ton of problems around this. That’s why the creative challenge, because there are those messes, like you said. You want some prep time or some cleanup time, and things like that. That’s been an interesting fun thing. We’ve got into some [inaudible]

Jason: Oh, god.

Melissa: Oh, yeah. There’s all kinds of good stuff in there. That’s the interesting challenge for us that we enjoy. What I’m challenged with as a small business owner is, I don’t know if it’s the press, or if it’s just the culture in general, but there’s this pressing vanity metric of, How much capital have you raised?

It seems like that’s the pattern you have to get in. You have to have a great idea and an awesome team to execute it. Make your prototype and then find some money and make it happen. We would rather chase revenue. It’s frustrating to be constantly confronted by this idea that we have to be chasing funding options instead of chasing revenue. So, I was looking on some advice on how to rebuttal that, how to talk about that.

Jason: Oh, good. Yeah. I’m ready.

Melissa: Jason, I have your book. There are two essays in there, right? There’s the, ‘You don’t have to raise money,’ is one of them. The other is, ‘Don’t forget about bootstrapping.’ But I’m still looking for how to have conversations in the community about not having to go for funding, that you can go for revenue, and how it changes the dynamic of the team when you go for revenue.

Patrick: I think you’re mixing up Brad with Jason.

Melissa: Sorry.

Patrick: I think you’re talking Brad Feld’s book, I suspect. Because you said essays. I think you were talking, ‘Do More Faster.’

Melissa: Yes, I was.

Jason: All right. Look, this is easy. First of all, it’s not fair to say that how much capital you’ve raised is a vanity metric, because it is real, right? You have dollars in the bank. Vanity is like how many pages you have.

Melissa: But it doesn’t help you achieve your goals really.

Jason: It does, because one of your goals is to have enough runway to try lots of stuff and fail a lot of times, or hire a really good person. It absolutely lets you do those things. It’s tangible, right? I 100% agree with you, so don’t worry about that. So, this is really easy. Of course you should chase revenue. Of course that’s the logical thing to do. It’s a business. It’s supposed to make money, and of course, profitable revenue, too. I think you’re implying that.

Of course, you don’t have to raise money if you have a sharp business that’s growing and it has a good margin, and you have the runway you need, you don’t need to raise money. Or there are lots of other ways to do things. Maybe you need a small angel round just to get you over some hump. Maybe you can get a loan. There are all kinds of things you could do if there’s some kind of little money bubble that you have to get past.

But no, raising VC and trying to go big, and blah, blah, blah, who cares? Of course that’s not the goal. That’s just one means to a goal that may or may not even be your goal, right?

So, of course, you should not listen to it. So, if you want to make a profitable, growing company then here’s what I think you should do. Stop listening to anyone and anything that says you should raise money. If you’re reading blogs where, in general, it’s about what you do when you raise money, stop. Just take it out of the RSS reader. You don’t have time.

Because I’ll tell you what, for every one of those there’s another terrific blogger who has lots of great information and encouragement and inspiration about people like you and like me when I built Smart Bear and like me when I built IT Watch Dogs, who want to boot strap a company and focus on profitability and revenue.

So you should read Rob Walling’s blog because the kinds of things he’s going to say and the kinds of techniques that he has, that’s Rob on software, those are going to automatically be the kinds of things that, automatically, you’re going to want to do. You should read Amy Hoye’s [SP] blog. It’s often more inspiration than it is stuff, but for the kinds of things she writes and does she is your champion. Everything that she writes and does is championing exactly what you’re saying, so that’s who you should be reading and getting inspiration information from.

Melissa: Yeah. I read her blog. I like it.

Jason: Do you know the women at ingoodcompany.com?

Melissa: No. I’m part of Women 2.0, but I don’t know that one. Women In Good Company. Is that what you said?

Jason: No, it’s just called ingoodcompany.com.

Melissa: OK.

Jason: It’s Adelaide and Amy, two women who have a co-working space in New York specifically for women entrepreneurs. They just wrote a book where they interviewed hundreds of women entrepreneurs. Here’s the title of the book: The Big Enough Company. You see where I’m going with this all ready?

They interviewed hundreds of female entrepreneurs including my wife, by the way, and to try to say, ‘What does it mean to create a company that fits the things you want?’ One of those things may be getting rich, but it may not, and even if it is, in what manner? Do you want to do this for 20 years or 2 years? Do you want to have a family or not? What does it mean to have a co-founder or not? What are things in your life, taking your whole life into context, that is important for your business? And then, what are some sort of specific stories of success and failure in trying to achieve those larger goals?

The point is just this. There are all of these resources out there and people to talk to who are completely in line with you and doing things that will inspire you, give neat ideas, and you can teach them something and so forth. If you don’t want to raise money then just stop talking to those people and stop reading that stuff. There’s just no reason to. It literally is that easy.

Melissa: Then what do you do when somebody says, ‘How’s your funding going’, or something of that nature?

Jason: Who?

Melissa: People at different social meet ups for entrepreneurs and stuff that I’ve been to.

Jason: Let’s be really specific. Somebody who, what, they work at dell and they’re wondering where your funding is? What’s one of the latest ones that frustrated you?

Melissa: I was out at a meet up and there was another entrepreneur there who was just really gung-ho, really adamant about the fact that you need to go after funding, you need to do it now. I’m just like, ‘I’m not going after it.’ Then they say, ‘Well, what do you want to be? Just a life style business?’ That’s the question I always get right after you say, ‘I’m not going after funding’, it’s, ‘Well, are you just going to be a life style business?’ You need to somehow raise a ton of money to be a big company.

Jason: First of all, the happiest, most fulfilled founders I’ve ever met have life style businesses. That’s number one. Number two, there is not a dichotomy; you either raise money and try to become twitter or explode in the stratosphere trying or you’re a plumber with a life style business. Those are not the only two choices for a business. That’s total crap. Why are those automatically the two choices? I built Smart Bear and it’s making million dollar individual deals and it’s worth many, many millions of dollars, more than 95% of all these deals that get funded in California and explode, and it’s boot strapped. It also is not a life style business it’s something else. It’s another trajectory.

That third trajectory is not the only other trajectory. It’s life. You can do what ever you want. The promise of entrepreneurship is that you can build the life that you want and do the things that you want to do or that fulfill you and hopefully let you achieve happiness as well. That is more in your power. You can build something real and touch people. That’s the promise of entrepreneurship and they’re saying, ‘Screw all that. The only measure is whether Polaris decided to put in some money.’ Who cares? That’s what I would tell them.

Melissa: Awesome.

Jason: Oh man, you don’t, now wait, you said this is some entrepreneur. So what company, do they have a company that’s funded?

Melissa: They have recent funds, yes.

Jason: OK. So there’s a great little logical fallacy, I should let Bob get a word in too, I’m just very, very passionate about this because, you have all this angst and crazy stuff over something, over other people’s stupid opinions, which I don’t blame you for one second because I am exactly the same way when people even make a little negative comment on the blog, I have the same reaction you’re having so I totally understand. But I’m also trying to negate it.

So, there’s this fallacy, I forget what it is, I bet Bob can remember, where once you buy something or once you commit to something, I mean the typical thing is you bought a car, you buy a new car, brand new car, you drive off the lot and then you discover a Consumer Reports article that shows that this is actually like the fourth best car in it’s class and you really should have bought this other thing. But, your brain doesn’t really want to think about that rationally, or admit that. So you come up with rationalizations for why your thing is actually still the best thing or the right thing. Maybe Patrick or Bob can remember what’s that called.

So, here’s someone who just raised money, they just killed themselves for months trying to raise some money, because that was right for them, I guess. But whether it is right for them or not, that’s whats correct for them, and so, sure they’re saying that. But here’s how you should treat it, because maybe the bigger question is, but how do you stop from listening to them? How do you not feel guilty about it? I do you remove that nagging thing that says maybe their right? ‘Maybe their right, I mean, they just raised money, maybe I’m wrong.’ How do you remove that part?

And so, I would do it this way, I would think, when someone gives you advice, unfortunately this is Meta, but I guess you can apply it to me, but when someone gives you advice it’s typically they’re giving themselves advice. They’re typically not finding out what’s best for you and then helping you get there. They’re usually just saying whatever they would tell themselves about their own situation. Like, did this person say, ‘Hey, what are your goals for this company? Are you, is it just you and a co-founder and you just want it to be like that forever or are you trying to get a Lear jet out of this company or are you trying to just make a good living, like what are you trying to do?’ And depending on your answer, then they’d ask how big the market is and then depending on the answer of that, ‘Oh, OK. So let’s see if, you know funding does make sense for you, you really should get it.’ Or they just had a cocktail party and say, ‘Where’s your funding?’ How do they know that’s even the right thing to do? They’re giving themselves advice and they’re saying it to you and that’s what most people do when they give advice.

Patrick: We had a caller last time who had something involving hardware and I met another start-up person just yesterday. They’re going to need money. There are certain projects where is just clear up front. Yeah, they need money, but that doesn’t mean everybody needs money.

Melissa: Right.

Jason: Bob, you want to chime in?

Bob: We have a technical term for the person that was telling you this advice. And the technical term is, fool.

Patrick: I thought it was douchebag.

Melissa: Let me practice that here.

Bob: Well, that would also work, but, you know you can see the logical fallacy here. We don’t need to hammer that point. But, I think the thing you need to look at here is why was this one of your hot buttons? Why did you hit the roof when he said that? And I think you need to disabuse yourself from the on-line media definition of success for a start-up. I’m going to somewhat temper my language here, but frack those idiots.

Melissa: Oh no, feel free to let the words fly.

Bob: It’s bullshit. Good, good. ‘Cuz that’s one that applies to this and in many different ways. So, I took a look at Booker.

Melissa: So, my question is though, how do you gracefully handle it?

Bob: You say, yes, that’s very interesting and thanks very much. And you go just about your business. You know, it’s just, if they just go blah blah blah blah, you just kind of say, ‘Thanks, that’s very interesting.’

Patrick: Start singing Madame Butterfly, that would work well.

Bob: Whatever works, but you know, I looked at your site. I really like it. If you add an add-on.

Melissa: Ooh, thank you. That’s quite the compliment.

Bob: Well, let me put it this way, how much is it and can I buy it because I have this need, OK? I love the interface, best one I’ve seen for this sort of issue and I’ve looked at a lot of different programs that do this sort of service. But, you know, there’s a lot to be said for sort of, laughing all the way to the bank. You have to realize that they have an emotional investment in what they’ve got. That doesn’t mean it has to be your emotional investment.

I really like the idea that you’re pushing here that the approach you’re taking of who we built this for I think that’s a great base to start with. I love the ‘Allies’ button, I just love the idea of somebody standing up and saying, ‘Hey, we’re not out here trying to become the next Google, we just want to be somebody you’ll find useful.’

Melissa: That’s it.

Bob: That’s what you need to focus on. If I had to put it in a nutshell, I would say, and I agree with the point Jason made, you just have to stop buying into all this crap, but the other thing is, you need to tell your own story. OK? Especially when dealing with media, I would just recommend strongly that you get more of what your story is and what you’re looking for and what you value and what you don’t value just out there. I think you’ll find a lot of people will want to do business with you because of that.

Jason: Yeah. When you’re in the moment, I think that’s what you were asking also, right? You said, ‘But how do I deal with them right then,’ right?

Melissa: Right.

Jason: So, I have a couple of things to say to that. Depending on your personality you can either choose to engage or exit the conversation as fast as possible. Probably the healthy thing is to exist because there’s really nothing good to come of trading words, I don’t want to say arguing, but to what end? You’re not going to convince them of anything and it’s going to be weird and you’re wasting your time. You could maybe be running into someone else at the same social gathering who thinks it’s awesome or who is a potential customer, so why are we talking to some guy whose obviously not listening even to what you’re saying. Anyway, not on the same page. The best thing is probably to exit.

But if you want to engage you can just, it’s pretty clear what some easy comebacks are, if someone says, ‘Oh, yeah, where’s your fundraising?’ You can just be, ‘Oh, you’re one of those fundraising people. You’re one of those people that think you’re free because you’re a founder except you’re not because you’re indebted to all those people. I’m actually one of those people who are actually free. I’m one of those people where I’m actually my own boss and I don’t have anyone else. What I do everyday is run my company however I want. It’s pretty awesome.’

Or you could hit them up on the profitability thing, ‘Oh well, I guess you need fundraising if you’re not making any money, but I have one of those businesses that make money as opposed to toys that hopefully will make money.’ Now that’s true, but to what end? You’re rallying yourself up too and you’re wasting your time. Here’s what I would do, I would try, this is really weird but it works. Actively try to feel sorry for them, fell pity for them. This is real. I’m absolutely serious.

Melissa: Just like my mother taught.

Jason: Yeah. Just think, ah, the only world view they have of what anyone on earth can be, number one, they’re completely egocentric and they think whatever’s good for them is automatically good for everyone else. That’s kind of sad and short-sighted. Number two, they’re trying to make me feel bad about it? Why are they even doing that it’s kind of an asshole move. Why do they even see it that way? What a jerk. You don’t even know me and also this person, as I said before, not even trying to find out about you before indirectly trying to tell you what to do or make you feel bad about it. Which I have a term for some of these people and now I’m projecting way too much, I think this is good, there are people that are transmitters, there’s no receivers. They’re all TX and no RX. They just need to tell you stuff. They’re not listening. This person is probably a transmitter because they’re not asking about your business. They’re jumping to some strange conclusion.

This is a crappy person who is not going to understand, it has this myopic world view and by the way one in which almost all companies with that world view fail. Almost all of them fail. It’s so sad. That’s what this person has elected to do and sort of [inaudible] projecting that on to you. Yikes. Keep that off of me.

So I would sort of bundle up this attitude of, ah, that’s so sad that that’s what you think this is. That’s what you think a company has to be, that’s so depressing. I would just treat it that way and if you have that in your mind when your responding to them, then you don’t feel guilty, you don’t question yourself, and you also don’t feel like you need to talk to them that much, either. It’s easier to walk away and just be like, ‘Oh no, we are doing so well with our, we’re so profitable and growing so fast we don’t even need investment, but thanks.’ And then I would find a way to exit the conversation as fast as possible. In other words, just say something good about yourself like, ‘Yeah, we’re going fast and we’re profitable so we don’t even need investment’, and then leave.

Patrick: Can I jump in here? Mel went through the Tech Stars Incubator in Grand Rapids, Michigan, Momentum and she had, and she also did some Toast Master stuff with me, so I had remembered this wonderful Toast Master’s moment. Her closing line was literally, ‘You can’t stop us but if you want to join us blank, blank, blank.’ ‘Cuz you have to give a pitch, at you know, you have to pitch to investors when you’re doing one of these things, but I thought that was really cool.

Melissa: You can join us, that was the catch phrase, you can’t stop us but you can join us.

Patrick: I thought that was awesome. Anyway, sorry to interrupt you, Jason, but what you said made me think of that.

Jason: No, I just think removing yourself from these situations completely because there’s no constructiveness in it. I mean in the worst case it’s just going to make you feel bad and waste your time. Actually in the worst case is it makes you feel bad and so on. Even in the best case, it’s still a waste of time because, you know, the things that you’re going to do and the trade-offs you have and the goals you have, are not commensurate with that attitude, so although their stuff might be right for them, it may or may not be right for you, probably not. And so, it’s not even a very good use of your time anyway. So even if the person is not an asshole and blah, blah, blah and very interesting and it is Brad Phelt [SP] your talking to and wow, that’d be awesome, still, that’s not actually a great use of your time and so I would use the emotional of pity to sort of separate yourself from what their saying and not have it project onto you but realize that their talking about themselves and just feel sorry for them about that. And then I would just remove myself from that conversation, remove myself from the RSS reader of those things, and so forth, and then the reverse.

Then surround yourself with people like Rob Walling and ingoodcompany.com and these things we talked about. In other words, steep yourself to the extent that you read at all about that kind of stuff, steep yourself in the opposite so that you’re constantly getting that positive reinforcement and, you know, whatever kinds of tips and what not that their throwing out are more likely to be relevant to you anyway, and applicable to you anyway.

Bob: One last point. Every time you meet and asshole like this, sit down afterwards and immediately think of three positive things you can do for your business that you can do the next day. Then you’re going to look and go, ‘Wow! Thank you so much!’ They’ll just sit there so puzzles though, you know, maybe he’ll drop dead of a heart attack.

Jason: I used to say, ‘We were actually doing so well with revenue and everything, I don’t even know what I’d do with the money.’ People were like, oh, yeah, kind of don’t need it. That’s pretty, I mean, you’re making yourself obviously into this super awesome business and it’s fun. Now they have to, now if they want to continue they have to argue that you should be spending more money even though you already have cash, like it’s kind of an awkward thing for them to even continue arguing with you about, right? It’s very short, too.

But the other thing is, the final thing is, he may be an asshole but of course, I’m projecting a little bit extra on purpose, right, because it’s fun and also because it can help you mentally in the moment. Actually, the most likely thing is that their not an asshole, it’s just their world view. It’s just gain, them talking to themselves.

Bob: Their an asshole.

Jason: It’s probably not, right. Again, just remembering that they’re talking to themselves and it’s not really not at you and you can detect that. Like just the fact that they didn’t ask you a question first indicates that their not really interested in your situation. So, again, it’s a lot easier to go, like, ‘Oh, that person’s goals are to be Twitter or go home. OK. That’s fine, doesn’t matter, we just have much in common, that’s all, not a problem.’ As opposed to like, ‘Make me feel bad or something like that.’ So anyway, I agree, the site looks awesome and I will be checking it out to show to people and it looks great. I hope to talk to you again.

Melissa: Thank you, Jason, I appreciate that. I appreciate that from both of you, both the support and airing this topic out, I don’t think enough entrepreneurs hear it. You don’t have to go down that route.

Patrick: I agree, and definitely needs to be reminded. Thanks a lot, Mel. I really appreciate it.

[Recording: 90 seconds.]

Bob: Send me your prices, please.

Melissa: Yeah.

Bob: I’m serious, I’m interested in seeing the details because I could use this, I really. I really like your interface.

Melissa: Single staff is 14.99 a month.

Bob: Sold.

Patrick: Sweet. We did business here today, folks. That’s awesome. But we have 70 seconds left. So I just want to take this time to thank everyone who listened. The chat when it was still lighting up, I’ll stay on for a little while. And thanks Bob and Jason. This was a lot of fun.

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