TMBA554: A Healthy Equilibrium

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Christopher Gimmer is the Co-Founder and CEO of Snappa, a SaaS (Software as a Service) business that allows users to create online graphics quickly and easily.

Christopher caught our attention recently when he opened up with a post on Twitter about the emotional rollercoaster of small business ownership.

We invited Christopher onto the podcast this week to discuss his own journey as an entrepreneur, how difficult it can be for founders to find and maintain what he calls “a healthy equilibrium”, and how he works to achieve his own balance.

You’ll also hear why Christopher feels that having a business partner has been key to Snappa’s success and what he sees as the pros and cons of SaaS businesses.

See the full transcript below

Listen to this week’s show and learn:

  • What made Christopher realize that the traditional life script wasn’t for him. (3:05)
  • How he started an online marketplace for design templates. (6:38)
  • Why Christopher and his partner ultimately decided to pivot to a SaaS business. (18:58)
  • Christopher’s thoughts on cryptocurrency as a revenue stream. (34:33)
  • Some of the emotional tolls that entrepreneurship can take on us. (41:41)

 

Mentioned in the episode:

Before the Exit – Our New Book
TMBA Masterminds
Partner With Us
The Dynamite Circle
Dynamite Jobs
Dynamite Deals
Tropical MBA on YouTube
Christopher Gimmer
Snappa
BootstrapBay
Startups for the Rest of Us
Ahrefs
Backlinko
Y Combinator

Enjoyed this podcast? Check out these:

TMBA460: Are We Being Honest About the True Cost of Bootstrapping a Business?
TMBA493: What They Don’t Tell You About Entrepreneurship
TMBA544: Should You Hire a General Manager?

 

This week’s sponsor:

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Thanks for listening to our show! We’ll be back next Thursday morning 8AM EST.

Cheers,

Dan & Ian

 


 

 

Full Transcript

Christopher: It’s just so different from my previous life of pushing paper, whereas now it’s like, we’ve created something out of thin air that 10s of thousands of people around the world are actually using and getting value from. It’s a pretty incredible feeling.

Dan: Welcome back to the pod. One of the interesting things about these strange times is there have been some pretty sharp threads happening over at Twitter dot.com. And one of the posters I’ve been enjoying is someone who I’ve met through our in person events at Bangkok, DCBKK and I just found him to be a really all around thoughtful person, someone you want to speak with about business.

His name is Christopher Gimmer and he’s the co-founder and CEO of Snappa, which is a SaaS or a ‘software as a service’ tool that allows non designers to easily create cool online graphics. So Christopher recently tweeted a reflection about the difference between the highs and lows he’s experienced as an entrepreneur, as opposed to those he went through in his previous career working in corporate finance in his native Canada.

So I thought it’d be cool to invite him on the show and share some of his thoughts with us. And something I’ve been thinking about, emotional management as you go through different stages of your career. Because sometimes you feel you’ve done so much but yet new challenges face us that sometimes look a little bit different than the challenges we used to encounter on a day to day basis. On the one hand, you can feel exhausted by that and frustrated by that. On the other hand, you can look at it as an opportunity and a privilege to be able to participate in the sorts of challenges that have the incredible payoffs that say running a SaaS business does.

Now Christopher may have left the corporate world behind but I think you can still see his sharp financial chops in a lot of things he and his co-founder have been doing in Snappa, including investing in Bitcoin. And we’ll get into that a little bit on the show. We’re also going to cover the pros and cons of having a SaaS model because of course, so many founders that have had the most exceptional results that have been on this show have done it through that business model. So we’ll dig into that a little bit, as well as the value of having a co founder. Are you missing out if you don’t have a co founder, so we’ll get into that. So hope you enjoy this one. I started off by asking Christopher about the inflection point for deciding to leave what looks a pretty stellar corporate career.

Music

Christopher: I mean, I was following the traditional life script to a tee. Go to school, get a good job, make sure you secure your pension. And so I was about, I want to say six years into my career, which at the time, I was working as a financial analyst for the government. And you get to that point where it’s just, ‘Wow, it’s the same stuff day in and day out and not feeling you’re really making a difference’.

And so there’s two moments one was – whenever, whenever I would attend these retirement parties, the people retiring were so freakin happy. And I always used to say to myself, ‘I can’t imagine having to wait 30 years to be happy’, you know what I mean? That’s all that they were looking forward to is retirement. So that was kind of red flag number one for me. And then the other one was the first time I took a trip to Southeast Asia with a buddy of mine. And it was just such a life changing experience for me. And to know that I can only do this for only three weeks at the maximum having to bank that vacation time. So it was the combination of those two things, where I kind of just first started to think: maybe I could be doing something different right now.

Dan: It seems to me though, there’s this kind of big idea of freedom that you could have, but then you’re making good money. What sort of steps you start to take to bridge that gap, because it feels enormous.

Christopher: So one of the things that happened was at my work, I met Mark who’s my co-founder now at Snappa, he did programming on the side. And we were the two young dudes in our office, whereas everyone else was a lot older. And every lunch meeting, they were just talking about building decks and stuff with the kids and just, we just couldn’t relate to it right. And we were just talking about completely different things. The more that we became friends and talked, he shared the same mindset where he’s the classic version of ‘an unemployable’. Mark’s a very creative person, and he thinks outside the box a lot. So, yeah, we just started scheming some stuff: what are the side projects that we can work on and that we can do on kind of nights and weekends, and that’s kind of where it all started.

We were kind of spinning our wheels for the first couple years and then that’s when I really started to listen to podcasts yourself and ‘Startups for the Rest of Us’ and reading blogs about how to do online marketing, learning about SEO. And then after a few failed projects, we started a marketplace for bootstrap templates. And that’s where we started making our first couple grand a month online.

And it was just a game changing feeling, even making 1000 bucks a month, you start to envision the possibilities – if I just multiply this by 10, we can now earn a living wage, we can quit our jobs and all of a sudden the energy and excitement really started to kind of take hold.

Dan: Okay, so even for me now I’m trying to think of myself as: I’m not unemployable. I had the travel experience. I had the good salary. And I’m tinkering, and I know there’s podcasts and all this stuff. But then you just said something like, ‘We put up a marketplace for templates’. Now, that’s where you lost me. How do you become a person who just starts a marketplace? Tell me about that progression?

Christopher: I started reading some stuff about drop shipping. And that, to me, felt very doable and approachable. So, we were actually trying to find keywords and different products so that we can drop ship. So, with a tool like Ahrefs, for example, you can plug in different keywords. So a key word could be ‘fancy socks’. And then from there, you could see how many people are searching for that keyword each month? What’s the difficulty, who’s ranking for that currently how many backlinks they have to their site? While we were doing this, Mark had actually kind of stumbled upon the key word, ‘Bootstrap themes’ and ‘Bootstrap templates’. And for the non developers out there, it’s essentially ‘Bootstrap’ is a front end CSS framework. So it’s, it’s essentially like a WordPress framework, but without the back end stuff. It’s just the design component essentially.

So Bootstrap, basically, what it allows you to do is instead of having to style all of the buttons and the tables and the boxes from scratch, it gives you a starting point that makes your website mobile responsive out of the box, this was a pretty new framework at the time. And we noticed that there was a tonne of search volume for ‘bootstrap themes’ and ‘bootstrap templates’. And there was only one dominant niche marketplace. And, we maybe naively thought, ‘Well, we can kind of create our own’. And we thought that there were little things here and there that we can do better. And then we ended up launching with that.

Dan: I guess one of the things this SEO approach allows you to do is, is sort of look at actual cash flows, rather than trying to come up with a business idea because when you say, ‘I started a marketplace for themes’, it feels like ‘Oh, my god, you’re freaking genius’. But when you look at the process, it feels like, ‘Well, you were actually just shopping around for things that people were interested in’.

Christopher: There’s two really cool things about SEO. Number one is being able to measure the demand. And the second really cool thing is that it’s a well quote unquote, ‘free marketing channel’. So you don’t actually have to pay to display. Rather, you can write content that kind of ranks organically.

So, I think it’s a really good channel for people that are trying to start this up on the side and maybe don’t have the capital or are unwilling to put in certain capital. So for us, it was pure sweat equity. So, we would go to our jobs, we would make the money there, and then we would kind of pour in all our free time into this side project. Mark was basically doing all the programming and the coding and I was just writing content, trying to get backlinks and just doing that over a couple months period.

Dan: Now, if you thought the belief in starting a business was difficult, and believing that your efforts are gonna pay off. What happens then is you have that first breakthrough, you sort of have success. And then a few years down the line, things start to plateau. You have to have an incredible amount of endurance, belief and experience. And I’ll just share from my experiences that success in business unlike stock market charts, say for example, it doesn’t look like a line. Often you have to struggle for a very long time and then you feel empowered to make a move. And in this story, as so many others. One of our favourite concepts came into play – in words of the host of ‘Startups for the Rest of Us’, Rob Walling, Christopher had to find a way to ‘stair step’ forward.

Christopher: The main issue, like I said, is there was a dominant player. And the thing with marketplaces is, the first mover has a massive advantage, right? Because there are network effects. So naturally, if you’ve got the most buyers already, the sellers are going to gravitate towards your marketplace because it’s the highest chance of selling of themes. And naturally the marketplace that has the most sellers on it are going to attract the most buyers because of the supply. And that’s exactly why Amazon is dominating the world right now., just because of all the network effects that they built up.

So what we ran into was, we were able to rank, I think at our peak, we got to number three in Google for the keyword ‘bootstrap themes’ and ‘bootstrap templates’. And at that point, I think we’re doing maybe four grand in profit a month or something like that. But we knew we knew that it was going to be this huge uphill battle to try to topple number one because, again, of that first mover advantage and all the network effects, and the margins on the business were way too small, so we couldn’t afford to do any sort of paid advertising. And then that’s when we started wanting to get into the Software as a Service space and recurring revenue just because the business model was so much better than taking a percentage of the sales and not having any sort of proprietary IP.

Dan: How many months or years did this take you to get to this point?

Christopher: So we launched ‘Bootstrap Bay’ April of 2014. And it took a good three to six months before we were doing a couple grand in revenue, I would say. And then by the end of the year is when we kind of got to that eight to 10K a month in top line revenue.

Dan: So you guys were moving pretty fast though.

Christopher: Yes. The one caveat is that the first thing we ever launched, which was a student dating website. That was back in 2012. So there’s kind of a two year period of spinning wheels and not knowing what we’re doing. And so when we launched ‘Bootstrap Bay’, that is when we felt like we kind of somewhat new but we’re doing, so there was definitely a learning period there.

Dan: When did you quit your job?

Christopher: When ‘Bootstrap Bay’ got to the point where it was doing a couple grand in profit, I initially took a leave of absence. But the scary thing with that is – I was actually in the middle of doing my CPA accounting designation, and my work was paying for it. And I had accepted a promotion on the basis that I would complete this designation. So I could have got into a pretty embarrassing situation where had I come back to work, I would have got demoted and had to pay back the money on top of that. But fortunately, everything kind of worked out and then when we launched Snappa, and we saw that, we had quite a bit of traction. I beneficially kind of handed in my resignation.

Dan: Bring me to the office when you’re asking for that leave of absence, what does it, what does that conversation feel like?

Christopher: Man now, that was one of the most nervous and scariest moments of my life. Because in my heart, I knew it was the right thing. But, my brain is, ‘Man, you’re making like’, I was making close to six figures at that time, I was going to get a sweet pension when I retired and my parents are more of the risk averse type people as well. And so it was just kind of battling – the heart’s telling you one thing the brain’s telling you one thing.

Dan: How did it feel walking out of there?

Christopher: It felt amazing walking out of there. Going in was nervous as hell but it just felt like this massive weight lifted off my shoulders. There was still a bit of stress and anger. In the sense that I had a house and bills and whatnot. So I was dipping into my savings, not not a huge amount but still I was spending more than I was bringing in, let’s put it that way. You know, went from making close to six figures a year to I think we’re paying ourselves 1500 dollars a month just to kind of eat and pay for certain stuff. But I just had the faith and the confidence that – if I bet on myself in the long in the long run, I’ll be successful at it.

Dan: How would you describe the difference between moonlighting on a business versus giving it your full time energy

Christopher: So for myself, I would have never been able to just quit my job and literally start a business from scratch, at Ground Zero. To me, that would have been way too stressful. I know that, there’s some people that do subscribe to that, the ‘burn your boats approach’ and just go all in, I would have been way too stressed out to do that.

But then what we found was that you kind of get to this point where it’s – you have the momentum, you see the traction, but you’re only able to put in so much time. Let’s say you’re writing, one piece of content per week, and it’s bringing you certain results. Well, if you can write four pieces of content a week, or if you can get double the backlinks that you were getting previously, you would kind of expect that your results would increase, right?..

Dan: You mentioned, you’re playing the long game yet you have this project that the medium term outcome seems to be that you’ve reached your full potential with the marketplace.

Christopher: When I took the leave of absence from work, we hadn’t yet reached that. At that time, I don’t think we were number three, we might have been number six, or number seven. So I knew that we still had some ways to go before we were to even reach that plateau. When we did kind of get to that feeling of, ‘Crap, we’re plateauing’. I had already taken the leave of absence at that point. But even then, it was like, ‘Okay, we have this thing. Let’s try to build off of that’.

And that’s kind of when we realised, ‘Man, it’s going to be a big uphill battle’. That’s when we really started getting into the idea of SasS and recurring revenue. Because with a marketplace, you’re theoretically starting from zero every single month. We just kind of knew that it was time it was – as Rob Walling kind of coined that the ‘Stair stepping’ approach, I kind of felt like ‘Bootstrap Bay’ was kind of that first or maybe that second step for us and we knew that, okay, we want to get to that third step we want to get to that the holy grail of recurring revenue and and SaaS

Dan: This is a moment, I guess I kind of think of it as a parlay. Theoretically, you want recurring revenue. How do you make that shift into going a different direction?

Christopher: So an interesting thing happened around that time when we were kind, ‘We want to get into the SaaS game’. So, one of the blogs that I followed pretty religiously back then was Backlinko, which is a SEO blog. And so Brian Dean, he has this technique he coined called the ‘Skyscraper technique’, and essentially what it is you find content that’s already done well, make your own version that’s 10 times better, and then kind of promote that content to the people that were linking to the existing one.

So I was on Reddit one day, and noticed that someone compiled a list of ‘free stock photo resources’. And it got a tonne of upvotes on Reddit. And this is when the sites like ‘Unsplash’ and, and some of these, ‘Creative Commons’, really nice stock photo sites were coming out. So it’s really interesting. And so naturally, developers and designers that were using our marketplace, they’re always kind of looking at stock photos for themes and whatnot. So essentially, I just kind of took those resources, added a bit more, and turned it into a really beefy blog post. And when I posted that, it ended up going viral on a couple of the social media sites.

So after a couple months, we actually started ranking on the first page of Google for ‘free stock photos’, which is just an incredibly difficult keyword to rank for. And so we were getting 10s of thousands of people coming to this one blog post. And then at the same time, we kind of had this idea for what ended up becoming ‘Snappa’. Because I had to create all the graphics for the ‘Bootstrap Bay’ blog. And I was using Photoshop, and I wasn’t a graphic designer, so it just became a real pain in the ass, quite frankly.

So our idea was – we have this blog post that’s getting tonnes of traffic, and we’re just linking out to all these other stock photo resources. And at the time, none of them had search functionality. They were just releasing kinda seven new photos every 10 days or something like that. So we thought, ‘Why don’t we just create our own and actually make it searchable and we just start with a collection of 1000 or 2000 of the best ‘Creative Commons’ photos?’

And so we ended up launching a website called ‘Stocksnap.io’. We ended up selling it later on, as well as ‘BootstrapFYI’. But so at that point, we then started getting all this traffic to both the blog posts and our free stock photo site. And then that’s when we’re, ‘Okay, this, this is how we can parlay this thing’, we can create our graphic design tool, and we can use this blog post and our free stock photo site to promote our design tool because of that overlap with the audience. And that’s kind of how we did that next jump to the SaaS app.

Dan: And how’d it go.

Christopher: It went really, really well. So we basically just threw up a landing page. I think it took Mark about five or six months to .. Well, I think three months to do kind of the beta and then We did kind of a beta launch and collected some feedback, fixed some bugs or whatnot. And then we ended up launching it officially three months after that.

But it worked really well because every single day, we just had people that were coming on the free stock photo site, which would click on the banner or the ad for the design tool, we would collect their email address. So by the time we officially launched the SaaS tool, I mean, we already had 5,000 people on the email list or something like that. And so a week after launching, we were doing $2,000 in MRR and I think by the end of the month, we were doing $4,000 in MRR.

Dan: And that’s monthly recurring revenue,

Christopher: Yeah, monthly recurring revenue. So I mean for us, it was, ‘Holy cow, we’re onto something here’, for us that was, that was a huge deal.

Dan: And now for reference to your monthly MRR is what?

Christopher: So today we’re at just over S118 in monthly recurring revenue.

Dan: It’s such an amazing steep line between those two figures. Is SaaS everything the theory told you it was?

Christopher: I would say it aligned pretty well with our experience, in that, it’s a bit slower in the beginning. When I looked at our MRR graph, it took us three years to make our first 50K MRR. And then it took only a year and a half to make the next 50K in MMR. And now because of COVID, I mean this is kind of a fluke thing, but it’s almost accelerating even more. And so that is the beauty of SaaS is that it’s slow in the beginning. It takes a bit of a while to get going. But then it kind of just feeds on itself and you start building that flywheel and I feel that’s kind of what we’re experiencing now.

Dan: Why is it slow in the beginning?

Christopher: You have to build out those marketing channels. And there’s also the word of mouth. And the thing with SaaS, the reason why it’s so great is because the revenue is recurring. But the downside of that is your monthly amount that you’re charging is much lower. Whereas historically, with software, you would charge them at least a year upfront, if not multiple years up front. So that’s kind of the Catch22 is when you first start a SaaS app, your monthly recurring revenue is generally really low because it just takes time to build it up. But then kind of on the back end of that you really start to see the benefits just because it’s stable, it’s easier to forecast your growth. And the best of both worlds is if you can work in a portion of your pricing to be yearly plans. And that way you kind of get the best of both worlds.

Dan: What do you think it was about that $50,000 mark that contributed to momentum.

Christopher: So for us was ..a big portion of our marketing is content and SEO. And so that’s another one of those marketing channels where it just takes time to get going. But once it gets going, it just becomes a flywheel. So in the beginning, when your website doesn’t have a lot of backlinks and domain authority, and you publish a new blog post, Google is not gonna take it seriously right away, or they’re not just gonna start ranking you. Whereas if you have three, four years of credibility and backlinks built up, that as soon as you start publishing a new blog post, Google will kind of take that seriously from day one, as opposed to, taking years to build up the credibility to rank your posts.

Dan: I’m thinking of the Stair step approach now, Rob Walling’s famous theory, and you’re, you’re talking about these things, it takes time to build momentum, it takes time to build credibility. And is the idea, as you understand it, that had back in 2012, or 2013, you attempted to do something like Snappa, that it would have been super risky because the feedback loops take so long, is that the idea?

Christopher: There’s that and also, it’s just more difficult to build a SaaS business than it is to, to launch a drop shipping business or info products. There’s just so much more of a learning curve. If we had launched snappa and In 2012, it wouldn’t have worked out – I know that for damn sure. And so I think what Rob is kind of advocating is – just start with something easier, start with one marketing channel, get good at that one marketing channel, learn how to just build a simple WordPress plugin that already has a built in distribution.

And once you’ve mastered that, then move on to the next thing which, now you’re talking about the product development is going to be more difficult. The marketing channels are going to be difficult, you don’t have that built in kind of distribution through the WordPress plugin repository or the App Store, and all that kind of stuff. It’s like you really have to build all of those channels and acquisition sources out yourself.

Dan: Again, grafting theory onto what was your practical experience, we talk a lot about on the TMBA, having to take a step back from where you were in your professional career, and you kind of have to believe that these parlays are going to come and that you’re going to be involved in something profitable, which is strange given,it’s all that dark cloud. What do you think about that idea that you do have to sort of be broke when you were already doing good in your life in order to do this entrepreneurship path?

Christopher: There’s that like, cliche quote, I forget exactly. But it’s something like, to be an entrepreneur, ‘You have to live your life, or a couple years of your life, no one’s willing to do for the long term’. I butcher that insanely, but that’s, you guys ought to look up the real quote, but that’s kind of how I felt.

Dan: You have to live like three years, like nobody wants to, so you can live the rest of your life like nobody can, something like that.

Christopher: 100% and, as cliche and cheesy as it is, I think there is quite a bit of truth to that. So I know for myself, the next kind of level up for me would have been that past six figures, but you and it’s not even, not even about money or anything, but I knew that working a salary job, at the end of the day, you’re just capped. You’re capped in terms of the amount of money you can make and you’re capped in terms of what your contribution is going to be. And so it wasn’t hard to look at the world and see all the most value being created in the tech industry. Everything’s moving online. I just felt like the writing was on the wall. If I want to have a really great life beyond what I’m living right now, I’m just gonna have to take that step back and I was willing to make that short term sacrifice because I took that leap of faith that it would work out in the long run.

Dan: Let’s look forward then in terms of, ‘What does the long game maybe look like for you and what do you see as potential and or desirable outcomes, given what you guys have accomplished so far’?

Christopher: So where I kind of sit today in my life is we’ve obviously been really fortunate. I’m incredibly grateful for what we built and accomplished. And I think Snappa definitely has a lot of room to run as a business. I think the next step for me would be to build something around my personal passion as opposed to just here’s an opportunity that we see and if we launched this we think we can make some money and build a great business.

So I would love to get to that point where I theoretically have enough money that I don’t have to work anymore and I can use that time strictly to build things that I’m super passionate about so that if it doesn’t work out, I can just try again and not have to worry about paying rent or paying my mortgage and all that kind of stuff.

Dan: One question about …you mentioned,you’re not a big money motivated guy. How do you stay motivated, every day to keep banging away at the business when it is an opportunistic business as opposed to something that you truly identify with?

Christopher: I would say there’s two things. So number one is just what we’ve been talking about, which is the motivation is to get it to the point where it’s banging out enough cash flow where I could just, we can theoretically put a CEO in place or get to that, exit which we’re quote unquote ‘set for life’ so that we can move on to that next thing which we’re deeply passionate about and it becomes less about money motivation. So I think that’s one piece of it.

And then the second piece of it is more for personal satisfaction. When we hit a million dollars in ARR for me it was just … even though it’s just an arbitrary number. I just had deep personal satisfaction that, “Wow, we did it, we built a seven figure business”. In the early days, it just seemed so far out there, it just seemed that something that only these crazy smart people know how to do or are capable of doing.

I don’t know what the next one is. I don’t know if it’s 2 million or 5 million or whatever. But there’s just some satisfaction seeing that number go up and knowing that we have this incredible team, that we’re all working together, and we’re creating value in the world and customers are digging the tool. It’s just so different from my previous life of pushing paper, whereas now we’ve created something out of thin air that 10s of thousands of people around the world are actually using and getting value from. It’s a pretty incredible feeling.

Dan: I think sometimes all of us can overestimate how important things like the topic of our business is. I’ve met entrepreneurs that have just deep personal satisfaction about how well their businesses run and to see how well their customers are served and it could be in pet furniture or in scuba equipment or whatever, and that person doesn’t even have a pet.

There’s so much personal value in having a platform like that, in having a platform that pays people that gives them a sense of safety and creativity. Being able to click buttons and have bigger things in the world happen. Part of the theme of my book is when you sell away those things. You miss them a lot. You miss the fact that you had such a wonderful platform. And now what you have is a bunch of dollars in the bank, which you can’t go back and just buy that stuff.

Christopher: That really resonates with me, the satisfaction from the team that we build is incredibly fulfilling knowing that we’re creating jobs, we’re actually contributing to our economy, the people that work for us, we have a great time on, even just the daily chats on Slack.

Theoretically if we sold the business and have a bunch of dollars in the bank account, and I open up my computer and now I don’t have that Slack channel, and we’re shooting the shit and telling jokes and all the work that we’ve done that everyone’s so proud of. I would definitely miss that. Incredibly, there is that deep satisfaction that we built this team and we are creating value.

Dan: Makes sense. One more technical thing I want to ask you about is the diversification of revenue into Bitcoin, something you’ve written about, and I want to put on the tape that just the biggest financial mistake I’ve ever made: had I accepted Bitcoin when DC members wanted to pay for DC BKK tickets in Bitcoin I would not be talking to you on this podcast right now I’d be drinking a margarita and my Mexican villa. And so there’s this idea of turning a little bit of your revenue stream into a cryptocurrency for customers who want to pay that way. And I’m curious what your thoughts are on that?

Christopher: 2020 has been a crazy year. And I don’t know how much time we have on this podcast to cover my thoughts on this stuff. So, in simple terms, you look at all of the debt that’s been accumulated by nation states around the world. You look at all the money printing that’s happening, the Bank of Canada’s balance Sheet has gone from 100 billion dollars to over $500 billion in a matter of months.

Dan: What does that mean?

Christopher: It basically means that there’s a good possibility that our currencies are going to depreciate in terms of purchasing power. So, with our business, we basically have a cash balance and they’re a war chest, if you will, that we save for a rainy day or for future endeavours. And we kind of took a hard look at this and said, ‘We don’t want to be speculating on stocks in the business because you have to have a really long term view. Bonds are paying out basically zero percent’. So we just thought it was prudent of us to convert a percentage of that cash balance into Bitcoin as a hedge against the future inflation that we think is very likely to happen given all of these events. So that that’s kind of our thought process on that.

Dan: And what percentage did you choose and how did you choose that percentage?

Christopher: So the way that I look at Bitcoin is – it’s an asymmetric bet, right? So now, I obviously don’t think it’s going to go to zero but Bitcoin really it’s probably either going to become worthless or if it replaces gold as a store of value, we’re talking a 50 x upside from here. And if it reaches global reserve status, we’re talking 100 x plus, right?

So the way we’re looking at it is, ‘Okay, we could either lose everything, or we could have 50 to 100 x upside from here’. So then the question is, ‘What percentage do you feel comfortable losing?’ But then on the other hand, you don’t have to put that much into it to capture quite a bit of upside.

So usually, when people ask me, ‘How much money should I put into Bitcoin?’ Obviously, there’s a variety of factors, I think, as a good starting point, everyone needs at least 1% of Bitcoin and I think one to 5% is a more appropriate answer, maybe all the way up to 10% depending on risk tolerance. and whatnot. And then again, you have to ask yourself, ‘Are you going to be financially ruined if this goes to zero?” If that’s the case, then maybe you want to scale back. But for a lot of people in our circles, entrepreneurs that are pretty resilient and probably a bit more risk tolerant and have that confidence and ability to make it back if they lose it. Yeah, I think one to 10% is probably a good place to be.

Dan: I have a similar mindset to you, and we haven’t done it in our business, but I’ve personally pushed 10% of my net worth into bitcoin. Exactly based on the thinking you’ve laid out here today. So I’ll just lay that on the table. I don’t think it’s for everybody, but it’s definitely for me. Talk to me about business partnerships. Where does the friction exist with you and your partner?

Christopher: I’ve been incredibly fortunate with my business partnership with Mark. We started out really as good friends. And I think it’s really important to really like the person that you’re going into business with because it really does become a second marriage.

Dan: Does it feel like you’re married?

Christopher: Hundred percent. I mean my fiance jokes and laughs all the time that Mark’s my my second partner or whatever. I can’t even imagine the hours that we spent talking on the phone and discussing stuff and obviously we hang out a lot outside of just business and stuff like that.

We trust each other 100%. And then I think the other thing is, the variety of skill sets. So, at least from a software company, I think a really good place to start is a technical co founder who’s really responsible for the code and the technology, and then having more of a marketing, business type co founder who’s kind of focused on everything else. So in the early days, Mark was just heads down coding all day long. And I was just heads down marketing all day long. And we just got out of each other’s way. We trusted each other to kind of do the right thing. You just have to have a really good relationship and it has to be someone that you genuinely enjoy spending time with.

Dan: I would say that that’s true from my perspective as well. If you just think about it from skill multiplication, it’s not worth it because of all the other stuff you have to do with the person and including trust and conversations and stuff. But it’s interesting because Y Combinator, they made it a requirement that you had to have a co-founder. They so believed in this idea that one plus one equals three, that they said, ‘Startups are just less likely to succeed if you don’t have a co-founder’. Why do you think that is having been in a partnership and having observed a lot of solo founders as well? Do you really think a solo founder is at a disadvantage?

Christopher: I think there’s two things. So number one, there is that I think skill multiplication. One thing to keep in mind with Y Combinator is, they’re kind of expecting to do the whole VC route, go the whole nine yards and IPO someday. And so I think it’s a bit easier, at least in the beginning, to do that with two people. For me, I get a tonne of value on the psychological aspect of sharing the journey with someone because there’s only so many people that you can have these conversations with. Because, the reality is 95% of people are just going to work everyday and collecting a paycheck. Going through the highs and the lows and being able to share that with someone else and kind of calm each other down when things aren’t going good or celebrating the victories with someone else. For me, I think it would just be kind of lonely to go at it alone.

Dan: Which brings me to the reason we had you on the show. You recently tweeted something that sort of caught our attention. Can you read the tweet for us?

Christopher: So the tweet was, ‘In my short career as an entrepreneur, I’ve definitely experienced higher highs and lower lows compared to working a more traditional day job. One of the things I’m consistently working on is keeping my emotions in check and trying to maintain a healthy equilibrium’.

Dan: Alright, so a lot of our interview was about some of those highs, you guys have done some amazing things. How can we share some of the low elements to people who are thinking about entrepreneurship as a path?

Christopher: Some of the lows that I’m sure everyone will experience at some point is just that lack of progress, or maybe just utter failure, to be quite frank. I was kind of mentioning the first two years of our journey was just non-starters, projects that just didn’t go anywhere. And then, going into ‘BootstrapBay’, that moment of plateauing and realising, ‘Alright, this isn’t going to be the thing. We kind of need to move into the next stuff’, going into Snappa especially in the early days, we’ve had certain technical difficulties.

And I would say more recently, one of the things that was really hard for me was having to let go of someone that we hired. That was difficult for me. So, yeah, every time that we’ve gone through one of these low points or come across these issues, in the earlier days. I used to really take them to heart and freak out a little more than what was necessary. And then after the fact, it always ended up being way more minor than you originally anticipated.

So for example, the first time the site went down, we didn’t have the proper infrastructure in place to prevent that from happening. And so now we do. Again, going back to this, hiring example. After that happened, we’re like, ‘Okay, every single person has to go through a sample project, does not matter what the role is or how confident we are, it’s just absolutely going to be part of the hiring process’.

And so the things that have helped me is – every time I come across a new problem, I’ve essentially trained myself to look at it as an opportunity to fix something that’s maybe wrong or address something. And then the other thing is just always having that long term view, this is just a bump in the road, it’s not going to crumble the business. And that helps me not go to that level where I’m just so down. And so emotionally drained, it helps me kind of just see past that.

Dan: So one last thing, Chris, I want to ask you about is you’ve been on the other side of these earbuds, thinking about what entrepreneurship might mean for you, how to get involved, but what do you say to folks that this year has really asked them to question their career path or how they’ve been interacting with business and they want to, they want to take that risk and sort of join the fun, so to speak, what sort of advice would you have for them

Christopher: Oh, it’s a tough one.

Dan: That is the toughest one.

Christopher: Again, sometimes cliches are cliches for a reason, right? I think the most important thing really is to start and to do. Unfortunately, in today’s society, there’s too many people that are clinging on to hope. And not enough people that are actually doing. The best way to change your life is for you to take control and worry about the things that are within your control as opposed to hoping that this messed up system is going to start taking care of you, it’s probably not going to happen.

It’s really just a combination of learning and doing so continuing to read the books, and listen to the Cast, but at a certain point, you really have to jump in, start doing the work, learning by doing is often the best strategy. Actually, someone tweeted at me just a few days ago and he was having trouble, almost getting started because it was just thinking too far ahead. And, a lot of people are waiting for the perfect idea and waiting for the perfect business.

I always tell people, ‘Don’t worry about having the best idea’. Don’t even worry if the business fails or not, you’re gonna learn so much, just by starting and the fact that you’re even working on a business, you’ll start to see like, ‘Oh, I’m using this tool, but it kind of sucks. It would be. It’d be, it would be sweet if there was a tool that did this instead’. Or, ‘Wow, I’m working with these freelancers or there’s these agencies. They frickin suck, I could do this better’, you know what I mean?

And so I feel just running a business will give you so many more ideas and it will develop your skill set to allow you to keep progressing. So, if you compare, a job to entrepreneurship. And I guess age plays somewhat of a factor but if you’re starting young, in your 20s, and going down the entrepreneurship path, it’s almost mathematically impossible that a job will throughout your career end up having higher upside than entrepreneurship, if you just keep at it. And I get it. I’m not one of these people that’s, ‘Oh, everyone has to be an entrepreneur’. It’s just not realistic. And some people aren’t cut out for it. But if you are cut out for entrepreneurship and you have the skills, and you have the drive and the ambition, it’s kind of like the stock market, right? If you invest in a stock, and your holding period is 1-3 years, there’s a likely chance that you might end up with less money than what you first invested. Whereas if you invest in the S&P 500, and your holding period is 20 to 30 years, it’s almost impossible that you’re not going to come out ahead. And so I kind of see entrepreneurship as the same thing. It’s volatile in the short term. But in the long term, it just seems a no brainer to me,

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Dan: Big shout out to Christopher Gimmer of Snappa swinging by the show a lot of the concepts in this episode, stuff that Bossman and myself have been talking about a great, great deal. Where are we going to take the experience and knowledge and resources that we’ve gained in our entrepreneurial journey? And how are we going to re apply it to get to that next level that we’re looking to get to? I love Chris’s analogy there of that investment in the skill set of entrepreneurship, of owning your own assets. You just don’t know a lot of times where it’s all going to lead. But I think when you step back and look at the systems you’re participating in, certainly an excellent long term investment. And one of the few again, we talked about a lot that you can really go from scratch to wealth, by following paths similar to what Chris was talking about here today,

Just got to mention that I really enjoyed speaking with Chris, we have a lot of things in common and it was just a really really fun, inspiring chat. I hope you found the same. Thanks again to Chris for coming by sharing with us his story on the show. And thanks to our sponsor, Earth class mail.com another shout out to our sponsor, check them out. And finally another shout out to our sponsor Earth Class Mail dot com, so excited to have them on board. Do go check out their services over at Earth class mail dot com and that is it for this week. We will be back next Thursday morning 8am Eastern Standard Time.