[Podcast] Lessons from the SaaS Playbook (Rob Walling)

Rob Walling is a passionate evangelist and mentor for founders of bootstrapped SaaS (software-as-a-service) companies, whom he serves through the TinySeed business accelerator and the MicroConf community. He's also the voice behind the podcast Startups for the Rest of Us, with over 600 weekly episodes. He's captured much of his 20-plus years in the industry in his fourth book, The SaaS Playbook.

In this episode, Rob digs into lessons he's learned as a father, husband, founder, and investor, and provides tips that will support your business growth in the months and years ahead.

Resources Mentioned

• TinySeed Accelerator for Bootstrapped SaaS Founders
• MicroConf Community for Bootstrapped SaaS Founders
• The SaaS Playbook: Build a multimillion-dollar startup without venture capital
• Startups for the Rest of Us (Podcast)
• Trello
• Castos Podcast Production
• Streamyard
• Commit Swimming
• Status Gator
• Findymail

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Transcript

Who is Rob Walling

Bob Sparkins: Rob Walling, thank you so much for joining me for this episode of The Leadpages.

Rob Walling: It is my pleasure, Bob. Thanks for inviting me on.

Bob: I'm excited to get into a lot of lessons you've learned building startups, selling startups, investing in startups. Before we do that, though, I'd love for you to share what's one way that you love to transform the lives of the people that you work with?

Rob: About five years ago, I finally put my mission, which I think is now my life mission. It's certainly the mission of the companies that I run and the podcasts I run, and it's to multiply the number of independent, self-sustaining SaaS companies in the world. SaaS, for those who don't know software as a service, it's just software startups. Twenty years ago, we would have said software, and 15 years ago, we would have said application service provider or ASP.

For me, I'm trying much like I did myself. I pulled myself out of a very working-class existence purely by bootstrapping companies. Then I started sharing what I was doing and people got interested. That's a transformation that I aim for in my crowd.

Bob: That's amazing. And I've loved working with you in the past. So in full disclosure, you and I have had a chance to work together when Drip and Leadpages were combined forces. Today they are no longer combined forces. You're no longer part of Drip nor Leadpages. You are running lots of other cool things. It is a real pleasure to pick your brain a little bit in the podcasting world. I don't usually like that phrase too much, but I want to share some get you to share some ideas around SaaS.

Business Lessons from a Dungeon Master

But before we do that, you and I share a little bit of nerdiness, and I think the people need to hear about this. You had the chance with your son to play Dungeons & Dragons with the son of Gary Gygax, one of the sons of Gary Gygax a few years ago. I'd love to know a what was that experience like? And B, do you have a lesson that you think Leadpages specifically teaches you about business that we could take on even for people that might have never played before.

Rob: Yeah. So at GaryCon, so Gary Gygax started D&D, and at GaryCon, which is like the nerdiest name for a con ever, there's like a couple thousand people who are just there to game. And so I now have selfies with both of his kind of prominent sons. There's a few others, but Luke and Ernie are the ones most people know about.

I was in a game where Ernie was the dungeon Master. It was a super interesting experience. And they said, oh, he DMs like his dad does. And I found it very different than we DM today. Very different. It's just a very different style. It's like a 40-year-old style. But it was super fun, obviously, to be involved in that. Dungeons & Dragons, one of the things that I think people outside of it don't understand is it is improv depending on how you play. It's like improv with dice. It's like pretend with dice.

There's a role-playing aspect. There are puzzles and there's exploration and of course there's what everyone thinks about, which is casting spells and hitting people with swords. But that has become such a less prominent thing.

So with my son, whom I play, he has learned to take on different voices, to think on his feet, both if he is being a character or if he is trying to think through a really difficult solution. Let's think about a creative way to swing from a chandelier and break through a window. Can I do that? And I'm like, I don't know, roll the dice. Let's add your dex modifier. And so I like the improvisation in terms of both kind of verbal in terms of kind of role-playing, but also in terms of troubleshooting.

Bob: That's neat. And obviously as a founder, you likely take on roles of different types of situations. Try to predict, the dice roll is a little bit more metaphorical than having a dodecahedron that you're just going to go ahead and spin the dice.

Rob: That's right. Well, and my favorite thing, see, my D&D group is my son. He's 17, and I've played with him since D&D, since he was maybe seven or eight. Everyone else is either a startup founder or like an executive at a SaaS company.

So it's a bunch of left-brain nerds with the right brain creativity. And really people who do everyone takes initiative to do things, you know what I mean? Because they're all driven people. Really fun. It's a really fun group to see interact.

Leverage Your Income for Household Help

Bob: That's awesome. Speaking of family, last episode we had a chance to talk to your brilliant wife, Dr. Sherry Walling. I asked her a similar question. I’d love to get your input on this as well. You are running a dual successful entrepreneur household. Any tips for those of us that, like myself and yourself, have an independently driven spouse doing their own thing and their own business while you're doing your own thing. Any tips for success in that kind of relationship?

Rob: Yeah, something that we learned probably a little later than I wished is since we are both successful entrepreneurs running these businesses, we do have more money than if it was just one of us working. We could live on either of our salaries, but obviously we have some excess capital.

Growing up, dad was an electrician, mom was a homemaker. Money was always an issue. And so I've had this mindset of, like, what's it called? Not the opposite of abundance. I've had this scarcity mindset. I grew up with it my whole life. And so, Sherry and I had these massive savings, and we were just frazzled at both ends because I was like, well, we can't pay someone to clean our house because that's not solid work. You know what I mean? It was just dumb. It was dumb.

So pretty quickly, to be honest, cleaning the house, we paid for early, and then it was like doing our lawn, and then it was like, hey, one of our sons goes to school 20 minutes away, 40 minutes round trip. That's not quality time in the car. I see him a lot. I'm not outsourcing my parenting. But then we hired a driver who became kind of a nanny, who became kind of a household manager because she could manage the sprinkler folks and the cleaners, and she does shopping.

Depending on your budget, like, the ability to outsource, in essence I bet Sherry said the same thing, didn't she?

Bob: She did not. She was talking about how excellent your communication and planning for the year has been and having growth years alternate, basically. So, again, tune into the previous episode, episode 62 for that conversation.

I love that idea of household help especially. I think it's one of the tips I often share with people when they're like, who should I hire first for my business? I'm like, somebody do your house stuff, because there's so much stress around that. So really good tip with that.

Hire a Team, Not a Family

Speaking of family, you've had the chance to build up software companies and found a couple you mentioned in your book, which obviously, those of you that are watching should pick up SaaS playbook at SaasPlaybook.com. But you mentioned in your book this idea of treating your team as a team and not a family. For those that are ready to hire their first, maybe their fifth employee, most of the people listening, you likely have small teams or newly developing teams.

Can you share a little bit more about why you think people should approach it as a team instead of a family?

Rob: Because you can't fire your family members, and sometimes you need to let somebody go. I've worked at companies I've been, from a distance, associated with companies where the founder doesn't run it like that, and it's like, oh, we're all just a fam. Aren't we just super close? Isn't this just great thing? And then they have to do a round of layoffs or they have to fire someone who's underperforming and people are like, oh my God, you betrayed us. The trust, there's just no trust.

Versus if you come in the door and I say, look, we are high performers, everyone here. I have very high expectations of myself and of everyone else on this team. And if you don't live up to those expectations for an extended period of time, obviously each of us goes through life stuff, ups and downs. It's not like two weeks of underperformance, you're gone.

But over time, if you're not the best person for your position, we will move to remedy that and sometimes that's a great mutual fit to do it. So I think thinking of us as emotionally enmeshed individuals is perhaps a good way to run a family. That's even debatable. I grew up kind of in a more enmeshed family, but I really don't ever think it's a good way to run a company.

Bob: And on the flip side of that, I imagine hiring people that are your friends or that are family members makes it less likely to get A team players in the first place.

Rob: Right? It's a big mistake. I see.

I'm invested in 151 companies, startup companies. And when I say startup, I mean one of them actually, I guess I got bought out of that one. But including WP Engine, which is a billion-dollar company that's in there, right? So startups ranging from a couple thousand dollars a month up to literally millions of dollars in revenue a month in the tech space. A mistake I see, it almost never works out, every once in a while it does, where two family members work together, I've seen it work out where they co-found the business and they are equals and they really are on the same page. I've seen husband and wife teams work. I've seen two brothers or brother and a sister. But when there's a differential in power, I see a founder who's like, oh, well, my cousin could do customer support because he works at Verizon and we're going to take him in and do that.

The problem there is there's a dual relationship. The odds of the cousin actually being the best person are really, really low. Then if you really ran a job search and got 100 resumes, are they likely to be that? And it's not that your cousin's a bad person, it's that then you think twice about letting them go or there's always this question in the back of people's minds if he gets promoted or he gets a raise, is it nepotism, you know what I mean? It just creates these dynamics that you don't need to do it.

People I usually see it where people have the fear. It's like, well, I need the familiar, so I know my cousin or I know my brother or I know insert my kid or my nephew or whatever, and it's like, yeah, how about run a complete job search and have them apply and then compare them with the rest of the team against everyone else. If they are the best, then hire them.

Hire Your Kids for Short-Term Roles (If Any)

Bob: I like that advice a lot. Do you recommend hiring your kid as a business? I know some people talk about it as a way to help with their kid’s finances for later in life, with opening up an early Roth IRA and all this other kind of stuff. But from a dynamic standpoint, as a parent, I don't know if you've ever hired your kids for anything particular. Do you stay away from it completely to separate things? Any tips there?

Rob: I have absolutely done it, and I only do it when I'm working with them directly because I would never curse someone else on my team to work with a 17-year-old or a 16-year-old who just doesn't, he doesn't know anything about the office. CC versus BCC. Bob, what are those fields for everyone's in the to line? I mean, just basic fundamental office stuff. They're not there yet, right? They're still kids.

But I have hired them, for example, to pack and ship my books. There's SaaS Playbook, right? I had to fulfill a few hundred orders. The main Kickstarter, we used a fulfillment center. But there's some things that happened after that where I have a couple of hundred paperbacks I had to ship. I can supervise and handle it. And I'll be honest, I gave my 17-year-old pretty specific directions, got him into my stamps.com account, and no joke, he screwed up like 5% or 10% of the orders. Like, he just screwed them up. He's young. He clicked the thing twice. So we kept getting the double charges, and I had to go back and request a refund.

So, yes, I hire them, but I hold it very loosely. I do not expect A-player results. I'm almost trying to teach them a lesson and allowing them to make a few dollars. But also, in that case, it was helping me out, so I didn't have to do 5 hours of groundwork.

Really bringing someone on full time on my team my teams are pretty small. They're like five. I have two teams of five. Really? I will just say exceptional folks. We went through a lot of people to find them, and we have very high standards. And so just throwing my kid in there, it would just be like, one of these people does not belong at this stage of his life. Right.

Later on, I think he will be that player, but, man, I can't imagine bringing him in and being like, all right, report to producer Xander. Good luck, Xander. It's like, oh, that sounds terrible.

Bob: That's wild.

The Case fo SaaS Business Model

I want to talk a little bit about Tiny Seed for just a moment. So TinySeed is a fund and investing group. Talk to us a little bit more about that. But more importantly, you really have dedicated the last 20 years of your life to SaaS as a business model. And although a lot of people listening are not in SaaS, I think we can learn a lot of lessons from SaaS. But I do want to give you the opportunity just to give a quick pitch for why is SaaS, to you, your favorite business model?

Rob: Yeah, well, I mean, it's the recurring revenue. It's just built into the model and everyone wants it. And if you don't have it, which I have run businesses that did not have recurring revenue and I was like, well, how do we get that? How do we get the subscription?

There's a reason there's like a kajillion subscription razor, boxes of razors and boxes of T-shirts and boxes of books and boxes that make his subscription is king and queen. That's really it.

I mean, the other thing, the margins are huge, right, compared to even if you could do productized consulting, which of course exists, which is where you just have a single offering. It's kind of like SaaS without the software where humans are doing it, then your margins take a hit right. At scale. SaaS can have and even not at scale, actually, I've had SaaS up doing about 30 grand and SaaS doing hundreds of millions will have gross margins of 80, 90%. And net margins of 50% are not unheard of net margins, cash.

It's the leveraging of the technology that allows us to scale and do that. TinySeed, to your point, is the first startup accelerator for SaaS bootstrappers. We've been around for five years and through that we funded about 130 companies around the world. I think in like 20 different countries. We have a gentle focus on the US. But realistically it's anywhere. And that's been a lot of fun.

The Bootstrapping Way

Bob: And you write in your book, and I know it's ironic because you are a fund manager, essentially, right, that you are in love with the idea of bootstrapping and not taking on funding too early. What's the case for that? Why is bootstrapping to you such a big deal for what would be successful for any startup?

Rob: Because I think the narrative is so far the other way in everyone's mind that to do any, I'm going to start a company, well raise funding. I'm going to start a coffee shop down the street. Oh, you should raise funding. I'm going to design a headphone. Well, you should go on Shark Tank.

And it's like, how about this? How about you go build a product that people want and will pay you real money for, and then use that to fund the business, right? That's the thing.

I'm not anti-funding. I'm a venture capitalist. So I'm not anti-funding. I never have been. But I'm against the narrative, this brainwashing, the venture industrial complex has taught everyone if you want to be a tech founder you got to raise money. Otherwise you're not anything. And it's like no you don't.

That's really what I'm trying to say and the subtitle of my book is build a multimillion dollar startup without venture capital. I'm not saying you shouldn't raise venture, but I'm saying there's this whole world out there.

I think around 1% of companies should consider venture. 1% of tech companies in the world should consider venture. I think about give or take 9% should think about bootstrapper-friendly funding. Like there's TinySeed, there's Indie BC, there's revenue-based financing. There are ways to do that and I think the other 90 should bootstrap. So I call it the 1-9-90 rule.

Bootstrapping gives you control and it gives you freedom. It is harder than raising funding. If someone puts $250,000 in your bank account, it's easier. You're ahead. You're at the 20 meters line of the 100-meter dash. You have to give up a small amount of your company to do that, but it is easier.

I've started six companies, like substantial companies probably in my life, it's probably more like ten or twelve, but like actual companies with employees and six or seven figures of revenue. Six companies in my life, five of them were bootstrapped, right? The 6th one is TinySeed, where we raised a venture fund. It's just so possible and you don't need permission.

You don't need anyone's permission to go do that, right? You just build something that people want and are willing to pay for and you go from there.

Bob: And I think one of the advantages that you speak about a lot on your MicroConf YouTube channel, which I'd recommend for everybody, is this idea of focusing on profitability so that you can fund a cycle of growth as opposed to burning through cash in 12 to 18 months, which a lot of people do if they don't have that profit kind of benchmark for themselves. So I think that's really ideal. So kudos to you for those historical benchmarks for yourself.

But also for those of you listening, you're in startup phase, right? You're, bootstrapping. I'm sure. And you're in that kind of business where you want to grow in a way that's serving your family. The timeline is just maybe a little bit stretched out, right.

Rob: That’s the way I think of it.

Bob: Compared to getting this funding in a month because you have a good pitch deck. One of the best phrases that is in the book is “build a business, not a pitch deck.” So I think that's important to think about.

Recurring Revenue for Service Professionals

Now, as I mentioned before, most of the people listening are not in SaaS, but I think they can learn a lot from SaaS tactics. And one of those you already mentioned which is recurring revenue. Talk to us a little bit about how could a service professional, in your mind if you have some ideas about this, how could a service professional use that idea of recurring revenue? And then I also want to get your talk on your thoughts on the idea of pricing psychology within that recurring revenue. Because you speak a bit about should you be the lowest or the highest or the middle? Talk to us a little bit about that.

Rob: Yeah, I mean, recurring revenue, depends on your space, but it's both hard and easy to implement. It can be as simple as what my wife, who you had on the show last week, did, where she moved from, well, you can book me for an hour for X amount to where you can book me for 3 hours for X amount. And now it's like, I think to sign up to talk with her as a founder, I'm pretty sure you have to buy a package of six. And it goes for six months. And so that is essentially six months of recurring revenue. And you can pay it all upfront. Much like with SaaS, you can pay the annual upfront or you can pay it in installments. It happens to be monthly in SaaS, but it can be quarterly or whatever you're doing.

It can be as simple as just thinking of longer-term packages. Like if you're truly doing consulting.

One of the hardest parts of thinking about this, if you are consulting, is like how to package it or productize it in a standardized way. Because the beauty of SaaS is if I build the software and I have one customer or I have a thousand customers, it's still the same software. Now there's a little more support, there's some customer success, you and I know there's some more effort, but it's not linear with the number of customers.

If I am truly doing consulting and services, if I have one client or a thousand, there's a lot more work to be done. But if you figure out a way to productize it much like Castos, so Castos is Podcast hosting? They're a TinySeed company and they're who I use to host all my podcasts. They have a productized service called Castos Productions, which is where naturally you would think, what do podcasters need? Well, they need editing. They're actually getting into more higher-end production of even, considering whatever that means.

They have a one time setup fee if you want them to like, hey, we'll get you into iTunes, we'll get your album artwork, know all the kind of early stage stuff. And then on a monthly basis, if you put out four episodes, do you want to edit them yourself? Do you want to find an editor on Upwork or do you want to pay Castos Productions? Who can edit it? Who do this week to week, who know what it should be, you know what it should sound like, right?

They figured out a way to productize that and what that allows you to do is you don't then have to hire a bunch of experts in anything. You can just hire folks who know how to edit, and then you kind of train them up, in essence.

Those are the off the top of my head, those are the two angles. It's that package mindset of, I'm going to package up more, or is there something even if it's not my entire offering, is there something in my business that I can think about productizing.

Bob: Cool.

Pricing for Value and Valuable Customers

Then, as far as pricing itself goes, you talked a little bit in the past about how, when you brought Drip alive, you started essentially at $49 a month, when price plans for competitors were lower, some were higher, et cetera. You had to build the product to get to that value over time.

When I see coaches and consultants who are doing this membership model, they have recurring revenue. Oftentimes they do start out at that $10, $20 a month for some astronomical amount of effort instead of pricing it where the value will be very shortly. Talk to us a little bit about your thoughts on pricing in a way that's serving the business.

Rob: Most of us underprice ourselves. We underprice our software, and we underprice our services because it feels like, well, doesn't everyone know this? Well, am I really worth that? Is the software really worth that? It only took me a few months to build it.

Oftentimes the value we provide is substantially more than what we realize.

One of the big mistakes in software that I see folks making is saying, well, I'm going to charge less $10, $20 a month, because then it's easier to sell, and then I just need 1000 or 10,000 customers.

The problem is, all the numbers are terrible when you do that. Right. Churn is super high. You get really kind of the worst type of price-sensitive customers. You get more consumer-ish type stuff. It's SaaS businesses that charge $10, $15, $20 a month. I've seen thousands of SaaS companies, right? The internals of them. Those are the worst businesses.

I would never run one of those personally. Especially if you're bootstrapping, right? That's the other thing, too.

Now, if you have 20 million in the bank and you're trying to be Netflix or Disney or something. Well, of course we know someone said, well, Disney charges Disney+ charges $15 a month. It's like, yeah. Are you Disney? Do you have that much money in the bank? Like, that's the difference.

If you're bootstrapping and kind of going up solo, you actually want fewer customers who pay you more money. Those are going to be the best folks. I call it aspirational pricing of, hey, Drip was not worth $49 when we first launched it, everyone was telling me, if you charge 19, I'd stick around maybe 25. And I was like, well, Derek, let's build features to make this worth. How would it be worth $49. Right?

That's where we started moving into it. We actually moved into marketing automation, moved into kind of an adjacent space because I knew that people were willing to pay more there.

Bob: Yeah, we see that at Leadpages as well, where we have competitors higher and lower than us. We're kind of in that middle spot, but the ones that are lower, they're mostly publicly traded. You look at their balance sheet and they're hundreds of millions in the hole each and every month. That's not a bootstrapping model to go by, that's a 15-year payoff. And most folks don't want to wait that long for that.

Increase Discipline for Content Creation

Bob: Cool, we talked a little bit already about that. You have this awesome YouTube channel over at MicroConf. You release a podcast and or YouTube video super regularly. You've been doing so for close to a decade now. I'd love to know what kind of tips you have for the discipline as well as the content ideas. So pick one of those two and then we'll follow up with the other one.

Rob: Yeah, Bob, it's a problem.

So 52 podcast episodes a week since 2010. Thirteen years. I'm at 600 and just recorded 676 yesterday every week. And sometimes I have to record ahead because I'm traveling, but every week, every Tuesday morning, that hits. And then YouTube is also 52 videos a year.

At times it is a grind, man, I will admit. Here's the thing, though, about the discipline. So with the podcast, it rarely does it feel like I need discipline. I actually love the medium. I love talking on the microphone, I love talking to interesting people, and I love thinking about these concepts.

I've written four books on this topic. That's how much I have to say on it. So for me, the podcast is it was a labor of love. It was a hobby. I did it on the side. It made no money until, I believe, we started taking sponsorships in 2018, and it helped us sell some tickets to our events to MicroConf. That was it, right? So there was not a ton of discipline involved.

The times when I but every once in a while, I do need discipline. I'll hit a rut, I'll get burned out. And then what I do is I record ahead. I'll record four episodes, and then I take a month off. That's how I get over it. I just stop doing it for a while.

But I will say the YouTube channel is different because YouTube videos are hard. They're hard like they're outlined by it's like, here's a topic. Talk about this to a camera for 10 to 15 minutes and make it entertaining. And it's like, OOH, this is not trivial. To do that I have needed discipline for. And the biggest thing, the hack that I found is there are several people relying on me, and if I don't ship, my producer gets screwed. Because he gets behind. My editor gets screwed because they get behind. My person who posts it to YouTube is frantically on a Sunday morning instead of taking the weekend off, right?

If I drop the ball, my people, whom I'm very loyal to, and there's like a trust built up, they have to make up for that, and that's not acceptable to me.

Similarly, I kind of started burning out on the YouTube stuff about a month ago. This is after about 18 months of again, 52, just every week, boom, boom, boom, cranking one out. And so I recorded ahead a month, took it off, recorded ahead another month, a few weeks later, and then took that off.

Now I'm starting to feel it back, get my mojo back.

In addition, here's the other thing that always cures burnout, always cures, always instills discipline is if things are going up into the right.

So when your numbers were growing, you just keep doing it, right? It's like we went from 12,000 to 65,000 YouTube subscribers in 18 months. So I'm like, Well, I can't not do this because this is the opportunity for us right now.

Anyways, it's a good question because anybody creating content, there's the troughs of sorrow that you're inevitably going to hit. And when things plateau, do you keep going? Should you keep going?

In my life, I've found the answer is usually yes.

Bob: Yeah, I asked that question in part selfishly, of course, as with many of these questions that I ask for podcasts. That's probably why you love podcasts too. You get to selfishly, have brainstorming sessions with experts on topics that you're really passionate about as well. But just that idea of batching, I think certainly helps out quite a bit.

Figuring out Which Topics to Talk About

Talk to us a little bit now about the topics. How do you come up with your topics? Do you have some kind of a brainstorming session with a group of people, peers? How are you thinking of those types of things?

Rob: It's shocking how that was a problem ten years ago and it just isn't anymore.

There's more topics than I could possibly cover. For the YouTube channel. We are trying to hit the algo, the algorithm. It is a little bit like SEO where we're looking at what are people searching for, what's being recommended, what's working? And then we try to figure out.

We have a consultant who tells us, hey, here's like eight topics. Do you have twelve minutes of good content on this? And is this relevant enough to your audience? So with YouTube, it's actually kind of nice because I get fed the ideas. I'll say one out of four, maybe two out of four in some months we come up with internally, like, not the consultant, right? It's not from keywords, but it's like, I wanted to talk about my Kickstarter, for example. Just because I ran a Kickstarter, I've never run one and I raised $108,000 and I was like, Whoa, that's great, I want to talk about that.

Then we would bring that and say, what's the title? Can we do this? Does this make sense to invest this time? Or we do a lot of Mastermind paid Mastermind matching with MicroConf. And so I'm like, hey, I want to do a YouTube video on Masterminds. Not as an advertisement for us, but really the value of them know so we can bring ideas to the table.

On the podcast side, it does just naturally seem to come in at this point with the listener base. So it's a little bit of a cheat. I get a lot of listener questions. I guess the last thing, though, if you look like probably every third or fourth episode is I call it a Rob solo adventure where I'm just talking to a microphone for 20 minutes. Those are all just ideas that I have, right? Framework strategies. And those come usually from being in the trenches. They come from a conversation with one of my founders where I'm like, I should really framework that. I gave them singular advice on there. But that actually expands. I've talked to like ten companies that need that, right?

Being in the trenches, which I'm sure a lot of your audience is, they're doing active work, you obviously have to anonymize stuff, but you can say, like, I have a client or I have ten clients who ran into this and this is how I handle this. Right? That's a good way to do it.

Other thing is, I do consume quite a bit of stuff, right. I listen to a lot of podcasts, both inside startups but outside as well. And I watch quite a bit of YouTube. In my hobbies, one of the podcasts I listen to is called Comic Lab. It's two comic artists who are independent creators and they have Patreons and they do Kickstarters for books and they're not in the newspaper, but they do comic strips. Basically, I'm not an artist, I do read both their comics, but I've never been anything in terms of that being an interest of mine. But some of the knowledge they share on their podcast, I take and will say, Comic Lab said XYZ. Here's how that applies to SaaS. Right. So there's these other disciplines that you can pull in and lend to your own.

Bob: I love that and I love the idea of being able to take lessons from disparate sources because a lot of times, if a person's not careful, they can be just another regurgitation wheel of production. Because if you're just following, like, give me eight topics for my podcast about entrepreneurship in ChatGPT and everybody gets the same eight results.

Rob: That's right.

Bob: it tends to get super redundant. So that's really good advice.

Rob: Yeah. Some of the best episodes I've done are where I bring in my loves of the Beatles. Like, I have entire episodes where I'm like analyzing Strawberry Fields Forever and relating that, the iteration of that to how you need to iterate on your startup. Right. And I actually have clips of early takes of that in the show.

I don't do that all the time because it would get old. It's a little too woo-woo for some people or just not tactical enough. But pulling in from other disciplines I think is something folks should take more of a leap on. Right. It feels risky when you do it of like, who someone's going to criticize? But those are the episodes that people are like, wow, that was so different.

Bob: I'll try to make sure to get back to that gold record behind you for those of you not listening, but we'll save that for towards the end of the episode because I think it's a cool story.

Determine Your Priorities with the ICE Framework

You've mentioned being able to be disciplined, with your routine this week in, week out or batching and so forth. You talk a little bit in the SaaS playbook about a decision-making framework for choosing what to work on next, and I think this is really an important skill for any entrepreneur. So talk to us a little bit about your ICE framework. It's something that you didn't invent, obviously something I've used as well. But talk to us a little bit about how that's really been helpful for you to decide what to work on next in your projects that you've worked on.

Rob: Yeah. And what's funny is I always forget the acronym. It's impact, confidence, and ease. That's what Ice stands for. Right. So this is really it's a product I think it came out of product management, where it's like, we have 500 feature requests. What should we build next?

Let's maybe internally narrow that down to the top 50 that we think we should build. You throw them in a spreadsheet and then you say, what do we think? On a scale of… what's funny is, the math and the scale are a little bit arbitrary. You could rate them one to five, you could rate them one to ten, whatever.

So you say, what is the impact we think this will have on our business or our customer base? And then what is the confidence that we have that we can build this and that it will have that impact? And then basically ease is like how it's the opposite of a level of effort. Right. How easy is this to build? So you want all three to be high, basically.

Then you can just either add them all together or I've seen people multiply them together, so I've seen two approaches and then that gives you some type of sorting.

Now, personally, I think that's one interesting data point.

As a founder who operates more on Gut, as left-brained as I am, being an engineer, I tend to make product decisions and those strategic decisions more right-brained creativity. And asking my founder gut, what do I think is next? I do like having that list. I would never follow that list straight down, right?

In the book I talk more about applying it to marketing approaches because a lot of folks are overwhelmed and they're like, well, I could do pay-per-click ads, I could do content marketing, I could do YouTube ads, I could do YouTube videos, I could do know there's like all this stuff you can do. What should I do next?

I would say take all the things you think you want to do, take that thing you just heard about on the podcast or read about in the book, put them into a spreadsheet and then think about what impact do I think this could have on my business? What confidence do I have in this? And then how easy is it to implement?

It's one signal, it's one more data point. I would not read it as gospel.

Bob: I think what it's helpful for me when I see that is it gives you this gut check. Like you mentioned, when you see the thing on top, you're like, no, that's not the first thing.

Rob: Yep.

Bob: The fourth thing is the thing that I'm going to do first.

Like you said, it's not a hard and fast thing. But I think it's helpful because the idea of just thinking through like, what do I really think the impact of this is going to be? And am I full of shit or is this actually going to be what's going on with the confidence level?

I like the ease. I've always used effort instead. And so in my formulas and spreadsheets, I've had to inverse the third column when multiplying and I like the ease pattern better. That makes so much more sense.

So thank you for that.

When to Persist or Pivot

Bob: Speaking of making decisions, this question came in from a post I did on LinkedIn from a mutual friend of ours, Ben Dlugiewich, who we both got to work with back in the day. And he wanted to know this idea of persisting versus pivoting.

As entrepreneurs, we have an idea project, a launch of some kind or even an entire business, and it's a struggle to get those off the ground. That could be again at the project level or at the business level.

When do you persist to the finish line versus pivot or pivot 180 with an idea? What are some of the factors that are going through your mind as you're making those types of really tough choices?

Rob: Yeah, it's a hard question.

We launched internally. We had a live stream called MicroConf on Air that we launched and this was during COVID right.

It's one of the few things that we've launched that just really didn't work that well. Like the first one, we got 100 people watching and then it just goes down so fast. There's just less and less interest until I'm live streaming for 30 minutes every week to 20 people.

We were asking ourselves every week like this is really low effort because it's just me, it's doing what I do, I'm getting in front of a microphone. And producer Xander was working StreamYard and it went to all the things and the level of effort was so low. But we kept asking ourselves and then it went to YouTube and it would get 500 to 2000 views, which isn't great for our channel, but it is something. It's like, well, like 1000 people saw that. So is this worth the 30 minutes?

We sat on it for like a year, 18 months? Just being like, I don't know, it keeps us we kept justifying doing it and then eventually we're just like, you know what?

The thing that pivoted us actually was we said this time would be better spent elsewhere. Like our YouTube videos themselves are taking off and we were getting mastermind matching going. There were other opportunities that we saw that were better.

I think that's how I think about it is if we're in a position where I do have multiple opportunities at any given time that I could be working on and that my team could be working on.

When things start to fall to the bottom, I think of shutting down or pivoting them into something that is working.

If you only have one, though, that's where it gets it's really good to have some type of outside conversations. I almost never make these decisions on my own. If I do, it's a gut feel of like this isn't working, it is done, we're done with this, we just need to change it.

Usually I'm in either a mastermind group where I'm asking opinions, I'm texting friends I know who are smarter than me, who are in my space, or I am asking my wife's opinion. I'm asking something. She's an expert. I wouldn't just ask if she was a random person, but she knows how to think through these decisions.

I guess what I'm saying is get outside input. You need the sanity check.

I will admit, it also depends on where you are in your journey and the audience you have and how other things have gotten traction. So if I were to launch something today, it needs traction pretty fast, otherwise it's not working. Because things I do these days get traction pretty fast.

But I'm 20 years into this and I have a lot of people on an email list and a lot of people watch me on YouTube. So it's pretty obvious pretty quick if it resonates with our people or not.

But 15 years ago, 17 years ago, it was not obvious. And I had 500 people listening to me. So it was really hard to know what was working when.

Usually I think it's knowing yourself. I fall on the side of I tend to do things for too long. I tend to just grind and grind and grind and grind. So I often have to say, is this really working or is this just what I do every week and I'm just going to keep going, right?

Then there's other personalities that just bounce from one thing to the next to the next, and then every other week they're doing the next thing because the next thing will take off.

Which of those are you? Or are you in the middle and then err on the side of the opposite? So I need to probably shut stuff down a little earlier than I usually do, and I think some people need to stick with things a little longer than they usually do.

Bob: Yeah, we talk a lot about shiny object syndrome in a lot of different angles of that, but I think I've likewise seen people that they just don't persist long enough because it's so noisy, right?

Watching YouTube, every video is this is the tactic or this is the business model, or this is the this. Especially if you're watching some of the videos, like even this one, the next video that shows up is going to be entrepreneurial related and most of the people doing that are trying to get you to do their thing.

Trying to shut the noise off and follow your gut is good.

I also love this idea of talking to somebody else, if for no other reason than just to hear yourself talk about it. And then if you tune into what your body feels like as you talk about it, man, that can really be a big game changer when you're turning that awareness up for that. So I like that you mentioned that too.

Rob: One of the most common conversations I have with my founders that I'm invested in or advising is this. It's like we tried this thing and it's kind of working and kind of not. Should we keep going? And that's the advice I'm giving them.

Example TinySeed Companies to Check out

Bob: That's awesome. Speaking of TinySeed, I have two questions or two last questions, and then I want to talk about this gold album behind you.

TinySeed supports. It's over 150. I think companies at this point correct my number,

Rob: 130.

Bob: What's a cool project that people listening to this should know about. I don't want you to pick a favorite, obviously, I don't want you to pick one over others. But among entrepreneurs, service providers, people that are listening to this podcast, is there a cool project that's in that stage where they could go and buy whatever they are offering and really have their life impacted positively?

Rob: It's a really good question and one I have never been asked. And what's funny is we're B2B SaaS. So it's a lot of very niche businesses. Like there's Commit Swimming, so if you run a swim team, then they have great software for it.

A lot of it is stuff like that, that's going to be really narrow. But when I go to TinySeed.com/portfolio, which is where all the companies are listed, which is what I have to do to try to get the full list into my head.

I know most of your folks are not SaaS providers, but if you have some type of software or some type of thing with uptime StatusGator, it can monitor all of your cloud vendors and give you kind of a collective status page and status update on what you're doing.

Then the other thing that might be interesting is Findyemail. It's one of the best, if not the best way to find an email for someone you're trying to contact.

It's usually for doing cold or warm outreach. And Valentine, the founder, has built an incredible engine. He's an engineer and he's attacked it in a way with it's got way more validation than the other tools you've tried. So if you are doing warm or cold, I think Findymail is something.

Bob: You could check out that's really cool. We'll have to take a look at that personally because we do that a lot with our partner program to find new people to help partner up with Leadpages, et cetera.

Using Trello to Stay on Track

Bob: Next question is around this idea of tools. So you obviously got a lot of help, but your day-to-day is on a screen. I imagine you have a tool or two that you rely on quite heavily to be productive or excited about getting tasks done that you're not delegating. Any particular recommendations in that world?

Rob: I'm old school, sir. I use Trello. I used to use up until even like six, seven years ago, it was still a lined notebook. But Trello is how I get my tasks in there. And email, of course.

Bob: Right, yeah. Is there any particular way that you have your boards organized in Trello that might be uncommon to the average bear?

Rob: I have to do, doing, done. And then I have an on-hold to the left of to-do, because what I've learned is and I'm pretty ruthless about what I will put on my to do Trello board. Because I find some people say, oh, Trello. And then they send 500 things to their Trello board and it's like, no, that's too much.

If you have ideas and brainstorms, put them in a notebook, put them in a mind map, put them in a Google Doc somewhere. Take the best, the ones that you actually want to move on, and then put them in that Trello board. And what I'll find is some things I'll put in the Trello board and then it sits there for weeks and I'm like, well, this probably isn't that important. So I move it into the on hold.

Then I revisit that every quarter or so, right. To say, are there any ideas in here that are actually good enough that I should implement.

The other thing I do is I love Trello's email-to-board or email-to-list feature, right? So I have an email address in my contacts that's like this long guide, but I just call it Trello. When I'm in Gmail, I do this all the time when I'm at conferences and people are like, you should check out this audiobook, or have you heard about this tool that does this? Or you should really contact this person, or I have an idea somewhere while I'm running or on my bike. I'll pull over, I pop up in Gmail, I type in Tre in the two field, and then I just type whatever it is there and boom. When I get back to my computer, it's at the top of my Trello board.

Then there's a next step. If it's an Audible book, I go add it to my wish list. If there's something else, I obviously go do it. But that is how I it's very rare that I drop, I'll say that I drop the ball. I'm not naturally good at organization and I used to drop balls because it's like I'm too much, it's overwhelmed. And now just that very simple system is how I've been able to manage it.

Bob: That's cool.

Inspiration from Music

Bob: Final question. You have this amazing set of art behind you. There's a Millennium Falcon for those of you that can't see. There's a gold album. Is that a Rothko behind your right shoulder or some other artist?

Rob: I don't actually know. My wife bought it. There’'s an old-fashioned right there.

Bob: Nice. An old-fashioned and of course a drip logo.

But talk to us a little bit about that gold album that's behind you. And I'm interested, since you do play guitar, you have a budding professional cellist in your house. Is there a special Beatles lyric or song that kind of motivates you? Like, it's the go to when you're like you're going to get fired up.

Rob: So yes, I love music. Music has just been a core part of my life, really listening to it. And then the first time I picked up a guitar in college, I was like, why did I not do this 20 years ago? And it's just this incredible connection to it.

It's an interesting question about motivation. I don't know that I listen to some music. I literally will pump Eye of the Tiger when we're about to do a live stream with some of my team and I'll pump it into the mic and be like, let's get pumped, you know? Just being a stupid jokey. I'm not like the bro typer to get pumped up, but it's just a fun jokey thing to get us excited.

I don't necessarily listen to Beatles to get pumped up, but I really know a lot of Paul's ballads, right? So Yesterday. Hey, Jude, Let It Bbe. I like John's stuff too, but really Paul just moves me, right? It creates that emotion of like it's going to be you know, and even though things are sad today, it'll all be good tomorrow. So I think that's more of what I rely on the Beatles for.

I listen to a lot of punk music, Bob, and that is what I use to get motivated.

Bob: That's awesome. So any particular punk we should be listening to for that particular effort?

Rob: Oh, boy. NOFX. I mean, even pop punk, Blink 182 and Offspring are super popular. But I grew up in the 90s, so that's what I'm rotating heavily now and then NOFX and MxPx are two of my faves that maybe are a little lesser known.

Some would argue that's not even real punk because they're all melodic punk, right. Where you can hear the melody and hear the words. That's more my style, but that's it.

Bob: That's awesome.

Connect with Rob Walling to Grow Your SaaS Business

Well, Rob, thank you so much for joining me for this episode. I know you have a lot of ways for people to connect with you. Share MicroConf and TinySeed. Where can they find more information about those two?

Rob: Yeah. MicroConf.com and TinySeed.com. Probably the two best places.

Bob: Excellent. And I forgot to ask you about this real quick. MicroConf, for those that don't know, what is it and why is it so different from other types of conferences.

Rob: So MicroConf started as an in-person event, but it really now is we call it the Original Community for Bootstrap SaaS Founders. And so it is an online community.

We do in-person events six, seven times a year in Europe and the US. And then we have Mastermind matching. We do a state of independent SaaS survey and report every year. We have a bunch of education. We have the YouTube channel you mentioned that's YouTube.com/MicroConf. So it's like free education for folks trying to get better. And then at a certain point, if they want to level up, then they can look at one of our offerings like MasterMind Matching, or head to an in-person event to get connected with other folks that are like them.

Bob: Awesome. Well, I think we could chat a lot about a lot of different things. Thanks so much for the conversation. If you haven't already picked it up, make sure that you're listening, you go to SaasPlaybook.com, pick up a copy of this excellent book. I read it in two sittings this past weekend. An excellent book. I did have the advantage of nine years of already being in SaaS, so a lot of it was familiar, but some of it was really good reminders and some of it was new stuff that we just haven't implemented yet.

I'm really excited to have read it.

Rob, thanks so much for joining me for this week's episode.

Rob: Great to be here. Thanks for having me, Bob.

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