Ryan Rutan: Welcome back to another episode of the startup therapy podcast. This is Ryan Rutan joined as ever by Wil Schroder, my friend partner Ceo and founder of startups dot com. Well as founders, there's often this expectation that we have on ourselves, our investors have of us, you know, our team has of us that we have to create these big opportunities. But given that most of our anxiety is actually driven by downside failure falling short on these big expectations, Why is it we spend all of our time thinking and planning towards that big opportunity and very little or no time spent pointed towards managing that downside, I think because it's not fun, it forces some really difficult conversations, right? I mean, at a high level when we look at any kind of big swing we're going to take, whether it's the startup as a whole or a specific initiative, etcetera. It's fun to be able to put together plans for how big this could get. But if you contrast that to, okay, well, if it doesn't work, what are we going to do? No one wants to talk about that. And it's dangerous because sometimes there's some really important details in that conversation that you should probably have a discussion about and I think we'll do as we generalize, right? We're like, okay, if we put all our money on this marketing plan and it works out, you know, then we'll have to hire some staff and you know, again, that's very fun. But when we have to point out the other direction and say, okay, if it doesn't work out and we just cleared out our bank account and we burned our runway. What are we going to do? And at first you'll have a conversation about, okay, we'll cut some expenses here. We'll cut some expenses there. That's not actually what's keeping you up at night. What's keeping you up at night is can I make my mortgage if this doesn't work? Like can I stay committed to this? Am I gonna have to let people go? I mean, some really intense feelings that are the heart of what we do and yet go completely undocumented. You know what I mean? For sure. It's never part of the discussion. You know, and it's funny because Most plans don't go to plan. I mean in the startup space, the expectation should be that that marketing plan that we've set forth in that budget we've set forth and that expected customer acquisition cost and our return on investment is not going to land where we think, it is you know, 90% of the time we're off. Not always by magnitudes, but rarely is it exactly what we hoped, but go back to something because you bring this up from time to time. But our motto from the beginning with this business was that we want to be around long enough to see this through, right? We want to make sure that the decisions that we make as startups dot com have put us into a position where were around long enough to fulfill our mission of helping founders be more successful, be more balanced, be more happy and build awesome fucking businesses, right? And that starts with a pretty serious focus on downside. And I think that again, other than the fact that we just don't like talking about it a lot of times, we actually don't know what to do, Right? Like if we make more money, everybody has an opinion on where to spend it. So like that's not hard. But if we lose money or we run 20, nobody has an opinion because when that happens, it carries with it hard decisions, very tough that nobody wants to talk about or make. So for example, we may be able to say, okay, if this doesn't work, we're gonna have to peel back our marketing budget as our CMO, you know, this better than anybody happens all the time. Yeah. And so, you know, sort of usually an easier decision to make, but if this doesn't go well and we have to let go of staff, people just don't want to talk about that. And here's why if it's not going to happen, I don't want to have a hard conversation about it. Right? So Ryan, if you and I are co founders of the business and we're just 50, 50 partners and you know, there aren't a lot of other people involved, we don't feel good having a conversation around well, Are you gonna be able to make your mortgage payment? You know, is your wife going to be on board with this? You know, what happens to my kids in school? Like, I mean, those are just shitty conversations. It's kind of the equivalent of going to the doctor and worrying about a terminal diagnosis and you're hoping that you just don't get that diagnosis, You're hoping for the upside, yep. And it's really uncomfortable to talk about what if you do get that diagnosis and what does that look like? But here's the thing we are in the business of downside. I know people, they don't want to hear that again. It's not fun. We're in the business of downside because statistically, most of what we're going to do is fail and I don't mean the startups as a whole, that actually does apply. I mean, in our day to day decisions in our strategies that we put together, we're running naked into the abyss. There's no way we can plan for any of this stuff. So why only have the plan around when things go good if more often than not things are gonna go bad. Alright, so before we get into this next topic, I just want to let you know what we talk about here is like 1% of the conversation, you know, really, this conversation is going on all day long online at groups dot startups dot com. Well Ryan and I pretty much talk endlessly with founders about every one of these topics. So if by the end of this discussion you like the topic and you want to dig into it a little bit more with Ryan and I just had two groups start startups dot com and we'll pick it up from there. Absolutely. So let's talk about downside strategy, right? We've been in the business of managing downside for quite a while now having, you know, acquired companies, some of them funded and dealing with the issues, you know, around diligence and everything else that comes with that. And you know, downside strategy is a big part of where that begins. Well, I think a lot of people like for us Ryan, we've been in the business of downside strategy at startups dot com since day one. Right. Which is to say, we think a lot about it. And we actually make our downside strategy planning a critical aspect of how we get to upside and I'll give you some examples. We've done six acquisitions of venture funded companies in our history now with those six acquisitions, a lot of people think, well, you only talk to six people and you made those offers and you did those deals, nothing even close to it. I mean, man, we probably dug into 100 companies, we picked six companies to buy, has nothing to do with the number of companies that we had to look at in order to get there when we did those acquisitions, we didn't do what you think we did, which was okay if we acquire this company, here's how big it can get and based on that value, you know, we're going to get involved the opposite. We actually said if we buy this thing and it takes a total header, how far are we? Right, right. How bad is bad? How bad is bad? And mind you two were bootstrapped company, right? So our tolerance for downside was very limited. So we had to have a downside strategy. It wasn't us just being practical, it was, it was doing it by necessity. However, we started to get really good at it and so we would build a model that said, okay, here's what we think is going to happen in a very sober kind of deliberate way. In other words, we weren't saying here's how big it could get, we were like, okay, this would be a base hit if it got this far right. If that didn't happen, you know, if we pop flight out, what would that look like? Right? How much of a strain would that be on the rest of the business units and 100%, And so there were some businesses that we looked at where, you know, they were good businesses, they were fit, you know, within our family of companies and brands that were interesting, but they had the potential to have some pretty devastating downside if things went sideways, Fun fact, things usually go sideways. Yeah, that that that wasn't a one off guess. And I think Ryan, you know, you can appreciate this. I think the biggest swing we ever took was when we acquired a company called virtual, our virtual assistant business, think boys a while ago about 2005, And on that one We acquired it was about 400 staff members. Yes, right. And I want to say if I recall about 800,000 to a million dollars a month of revenue, it's ballpark, yep, pretty close. Yeah. Which also equated to just as much in cost. So let's play that out for a second actually, it equated to more than that in cost. That was part of the problem. Yeah, okay, and so yeah, that's a great point, I shouldn't overlook that, but the point is it was enough money both on the revenue side, but on the downside side that if it went sideways, it was going to have a major cataclysmic type impact on our business. Yeah, this was the asteroid hitting the planet type moment 100% and if it worked, which it did in the end, great, but who cares if it works like whoever has a problem to say, oh my God, I'm up all night because my business is just going so well and I, you know, I can't figure out what to do with all this money, I forgot to manage all the upside. I just Yeah, like like if that's your problem right now, Stop listening to this episode. In fact send us your strategy. We are dying to hear that strategy for the 99.99% of the rest of us keep listening. But the reason we were able to navigate searchable very quickly required it damn near overnight and turned that into a good business over time was because we developed a really deliberate downside strategy to say if everything goes to hell, here's exactly the order of events that were going to be okay with it. I think it's worth saying be okay with because we could have that discussion, you know what I mean? Yeah, that was an important part of it, right? We did spend a lot of time talking about how we felt about it, right? I remember going around the room you me and Elliot and talking about you know how we felt about it but not what did we think about it? Right. How would we feel if these things happen? Right. Like so what if this does go completely sideways? Right? How is that going to emotionally impact us? How is that going to change our decision making elsewhere? How are we going to feel about the decisions we're gonna have to make? Should that happen? And that was very, very real. And you know, it's funny because there's there's a lot of like blank spots in my memory around that time, simply because, you know, we were literally like there was a period I think where we were all awake for 72 hours, we were getting that done and then some collapses after the fact. And so there are some like holes in my memory around that time. But I distinctly remember sitting in the conference room and going around and talking about like, how do we feel about this? Like, you know, at at a deep, deep individual level, like how does this make you feel? What is your your sentiment towards the risk of this thing? And it was a very, very raw conversation. So with a lot of startups where this actually comes into play because a lot of people aren't doing acquisitions. That's not really their problem. Where this comes into play is in your own startup. If things don't go to plan and they never go to plan, what is your tolerance for risk? What is your tolerance for making tough decisions? Right? That's actually what we need to be thinking about first. And it's not that we don't think about it. That's why we're up at 3:00 AM. We don't quantify it. I was going to make that distinction. So I think there's two pieces to that tolerance, right? There's what can you tolerate as a founder, right? What can you personally tolerate? And I don't mean in terms of the impact to you personally say to your financial bottom line, yes, that's important. But I'm talking on more like the emotional resilience side, what can you tolerate as the founder and what can the business tolerate? Right? Because there's two different thresholds there and then there's two sides to that, right? There is the qualitative side. And then as you said, there's the quantifiable component which is absolutely important because that's going to drive really. How much can the business tolerate now? Of course there are other considerations that are emotional within that at the organizational level as a whole, right? If you make a decision that requires some very serious action on the downside to make sure that the thing keeps moving that can have an organization wide impact on, you know, the sentiment, the feeling, the motivation of the teams in cases where staff have to be let go, what's left of the teams, all of these things really, really important to make sure that you're clear on the impact how deep it can cut and how much of that you can tolerate. I gotta tell you from a tolerant standpoint. I'm thinking back to when Ellie and I started a company called afford it and that went poorly. I mean we just started and failed to take off and we didn't raise enough money for another round and we had to shut it down. The part of the downside plan that I didn't consider. You know that I wasn't willing to have a conversation with myself about was am I willing to accept failure if we can't raise that next round? Am I okay? Just saying, hey, this didn't work out how I planned on to the next thing and so I didn't. And so instead I just tortured myself for the better part of two years, not because I thought the business was going to succeed, but because I wasn't willing to fail, right, stick on that for a second because I think this is really important. We discussed this four or five episodes ago now and I think it's a really, really important point that certain decisions that we make cut off other avenues, right? So the decision that you made to take on funds and to develop the burn rate that you had and the way the business was going and that you had investors that you had to keep happy, led you to not wanting to fail right? Some of those factored into your decision around whether or not I want to fail and I'm gonna keep pushing this forward so that I don't have to look like a failure in front of other people, even though, as you've discussed many times they already knew it was failing and none of them cared about it anymore. So this is really just you torturing you. But that's because at the time you made, that decision, you hadn't factored in that part of the downside? Right? And it's so, so important to remember that some of these decisions that we make cut off possible alternatives. Right? Had you not made that decision? Had you not taken on funding? Not saying it was even possible in the case of that business, you guys needed funding, But had it been possible to not take on funding and had you not taken on funding? And there was really nobody else to tell other than Elliot that we're shutting this down. Our zeros of customers aren't gonna care or zero staff isn't gonna care. It's just you and Elliot having a conversation about like, should we just wind this down? Imagine how different that is. Right. Had you managed that part of the downside? It would have probably helped me avoid what was one of the lowest points in my business career, in fact, and I'm going to give credit to Elliot here because he's just a really good partner. Had I said to him, listen man, if this goes to X, y or Z, I need you to remind me to pull the plug. Yeah, Right. And he would have, he would have for sure. And I missed that. And it cost me a lot emotionally. And I think that's part of this overall strategy. It's a giant. If then statement to say, if things don't go to plan a number of things, then what are we willing to sacrifice? And let's make it clear, even if we can add 10% clarity versus the 0% we have now, we are light years ahead of where we probably are, you know, we've done episodes on this in the past where we say the worst thing we can do with failure is not define it, correct because when it sits, you know, is that a big amorphous cloud where all these bad things are gonna happen in the world is going to explode and it's gonna be apocalypse, right? And there's gonna be zombies running, you know, running around running amok when we do that and we don't give it definition, we make it impossible to manage. But when we do, when we say, okay, look, if things don't go the way we expect, if this thing, you know, takes a header, here's exactly what's going to happen, right? I'm not going to not eat or feed my family, I'm going to get another job. It's not gonna be what I prefer. But let's be specific about it, right man, I just had a great conversation with the founder probably three weeks ago on this very thing. He had to wind down a startup And he was so worried coming into this. I mean he was just he was killing himself with the stress of what was gonna happen and how forever and ever after that everyone was gonna hate him, all of his staff was gonna hate him, all of his friends were gonna look at him as a failure. You know, his family was gonna start, they're gonna be out of their house, all these horrible things were gonna happen, right? What happened at the end he gave, he had the hard conversations with the entire team was about 16 people within two weeks. He had helped all of them go on and get other jobs. He himself found some contract employment that he was very happy with and he's enjoying himself now and he said within a month it was all gone right. Like all of the failure that he was really, really worried about all of the big things that he was scared about because he hadn't really thought about what will it actually take to avoid those things, turns out it was a couple of weeks of phone calls to his network to get all of his staff placed into new jobs and then going through his network and finding some contract employment. Right? Not that bad. Right? So to your point, we can't just leave these things as Amorphous. We can't leave failures. Amorphous. We can't leave. What are potential downsides? Amorphous. Are we going to get it exactly? Right. Hell no. Do we get anything exactly? Right rarely, But you can't leave it as just the big question mark. Right? So Our upside looks like this. We're gonna scale $200 million five. It's gonna be great. What's your downside look like? And I'm not sure agreed when we talked about two mechanisms there and they definitely apply here and if you haven't listened to that episode and this is intriguing to you. We go into a lot of detail in an episode around how to make potential failures less scary. I think we, you know, we did it a few episodes back, you know, by the way, I just want to mention if what we're talking about today sounds like the kind of discussion you wish you were having more often, you actually can, you know, we're online all day every day working through exactly these types of topics with founders, just like you. So any question you would have or maybe some problem you just want to work through. We're here and we love this stuff and we're easy to find, you know, head over to groups dot startups dot com and let's just start talking. But we talked about a really specific mechanism that I'll just mention again here because I think it applies, we talked about taking these downsides and talking about the duration, how long will that be a problem and we talk about the severity, how intensive a problem will that be, which is exactly what you just described. Yeah, it was two weeks and it was intense and then it was over and then it wasn't intense anymore. Right? So yeah, duration and severity are, are the two things you need to look at their, when we define our downside strategy and one of the outcomes let's say is, okay, well I'm gonna lose my job, lose my income here and I have to get another job can't stop there. We have to play that out further because that's where we're still leaving it to undefined. How long will it take me to get a job? I don't know this exactly, but I, I know it probably won't take me six years. Right? So there is a timeline and how much will that cost? We've been entrepreneurs for a long time. I'm pretty sure we're unemployable at this point. Oh yeah, no, I've got 30 years to prove that. But stepping back to the downside strategy, so a big part of it here is of course having it and talking through it. Even putting it on the table. I think that's critical. And I think part of it is saying to your partners, co founders or even your staff and or your spouse's etcetera, that, hey, you know, here's what's on my mind, here's what I'm thinking about. You know, here's how I'm trying to define what a moment ago just felt like broad and I think that goes for miles. But I think the next step we should talk about is how to start applying the fine details of this strategy and kind of, you know, where we've seen founders do it well and kind of where we've done it. Well, I mean, the timing on this is great and then this shouldn't be something coming out of blue sky for anybody, you know, given the year that we've all just gone through with Covid, pretty much everybody had to manage downside now, whether they strategies for that or not, who knows? But people were definitely managing downside across the board. So why don't we spend a little time talking about how other companies did this, how we did this? I know you and I had ad nauseum conversations with founders about how they could do it, you know, specifically contextualized to their their own businesses. There were some generalities of course, but I know the both of us spent a lot of time helping founders navigate this process and I can say in my case and curious to hear your answer, but none of them had a particularly good or even existent downside strategy. By the time they reached out to me, I think sometimes the folks that I talked to had categorical things will have to shut this down will have to shut this down. But they were missing some important details in between. I'll give an example of how we thought about it. When COVID hit at the very beginning in March of 2020. I looked at it going, I've been to this movie before, not a mass, you know, pandemic movie, thankfully, but a mass kind of problem in 2007, during the financial crisis when everything just basically shut down overnight. But I have three companies running during that time. Incidentally one was afforded the one that I mentioned. You know, we couldn't raise more money for not a great time, not a great time. Then end of 2000, 2000 and one, obviously when the dot com bubble burst in the financial crisis happened in the U. S. We had 9 11 happened. That was also completely apocalyptic to markets and to startups. I lived through that one too. Now while this one was different in its own right, it kind of just had the same cadence, right? Everybody was going to take a hard right turn overnight and that's really what it came down to and so what we told our staff and this, I think this was important. Part of the strategy was, look, no one knows what's about to happen, but we do understand what to do in case of emergency and here's what that looks like. And so I think the first thing we did, well, I'm proud to say, we actually managed this thing fairly well, but we also helped a lot of other startups do the same. The first thing we did is we sat down internally like you referred to Ryan and we said, okay, let's be really specific line by line what order of events is going to be and our business did take a hit right right away. The difference was april was, yes, the difference was, we knew the order of events. They sucked, by the way, this isn't the same as saying we're okay with it or we're good with it, right? We just knew how to deal with it. And so what that looked like. And again, we're gonna get into details what that looked like was, what are the order of events that we're able to kind of absorb the loss of revenue in some cases for other businesses? The increase in cost, if that's part of it and what's the difference between stuff that's reasonable meaning? It doesn't hurt people and what's the stuff that's, you know, cutting into the bone, which is obviously letting go of staff, et cetera, but there's another part of it too. And as the folks running this thing, what's our tolerance? How far are we willing to go before it's actually not okay anymore. A conversation very few founders have. Yeah, I think the circles back to tolerance, right? What is the founder willing to tolerate? And let's be real talking about cutting marketing budget. Never my favorite topic talking about, you know, having a founder to have to talk about not making their mortgage payments very different conversation. Right? Totally. Much more painful, Right? And so, you know, you can think of it as concentric circles, you know, you talked about it as an order of events. It's kind of like, you know, which one of the dominoes will fall first and how far will we let it fall before. We're just like, nope game over, we gotta stop here like we can't tolerate this. I mean, as you said, it was a conversation that not a lot of founders were having and I remember a lot of these conversations where, you know, we were pushing people and forcing people to actually look at that part of it because it wasn't a certainty in these cases, but there was at least a percentage likelihood that it may get to that level for a lot of the startups that we worked with, especially the earlier stage ones, you know, where they were just catching stride. You know, maybe just gotten to break even when global pandemic landed on their head and now all of a sudden there back to managing a burn rate rather than a growth rate and it was not comfortable, right? And it involved, you know, asking people, you know, kind of digging into personal business or at least making them digging themselves and say like, you know, where does this break? How far can I go with this before it cuts into the bone? I had a conversation with my wife about this, right? I mean, again, the conversation went all the way through, right, We went through where can we cut costs on marketing or office space or contractors and always last for us has always been our staff, which is a hard conversation to have and I've got to be honest, that's not necessarily the last line item for everybody sometimes that's the first line item because that's your cost of goods sold. And so again, we were in a position where we could try to leave that for last just because our business had that luxury. But the problem is for a lot of businesses, that's actually the first thing you have to cut. For example, if you were in an ad agency like I used to, right? So as I was getting ready to bring the example, if you're an agency that is the first line in any professional services, right? So and those are people in live in, you know, their own mortgage payment or what they have in such a hard decision to make. Right? So I don't want to trivialize it whatsoever. I'm just pointing out in our case that happened to be the last thing on the list, you know, thankfully. But that wasn't really the last thing on the list. It was the last thing on the company list, but not really last thing on my list. And so I sat down with Sarah, my wife and I said, look, how far are we willing to go? Right? And I got to say my wife backs our decisions. But she also does a good job of establishing tolerance because she's indifferent, right? And in her mind the business is just a vehicle by which we make money, right? There's no emotional attachment the way you or I would be right, which is great by the way because it keeps us sober on what's really happening. So I look at it as well if the company is not doing well well that's my fault. And by way of that I deserve to be punished, so to speak, right, you know, so I deserve to lose personal money. I deserve to not get paid. You know, all these things, we make this stuff up in our minds by the way, nobody else feels that way. We're the only ones, but regardless that's here and there, but we basically established kind of a threshold to say, look, if it hits this point, you know, we got to do what we gotta do. But very few people have that conversation and the only reason we knew to have that conversation because Sarah and I were also together during the afforded days when we didn't do that when I just let it run me through the ground. Yeah. And so experience is such a great teacher unfortunately. Yeah. Look, and with that, I think this sparks a lot of conversations that we just typically don't want to have. So we avoid them. So we don't have a plan. And so then we're totally screwed, right? But what happened here was because we had a successive plan and we knew that as we, you know, sequentially started to go through each of these line items that there was a point where we're going to have some seriously hard conversations and it was like, okay, it's code green at the top, we gotta cut back some google paid marketing or something like that. Sorry, google, you're going to make less billions of dollars from us. Uh you know, but we're going to pay for it later because you know, we're not going to have those customers. And then we got down to office space, which ironically wound up being a huge win because it turned out nobody wanted to be at our office and that was just a stupid line and our lease was up, you know, who would have thought. But then we started to get, you know, toward contractors. And even though their contractors, you know, by title or by business relationship, we take those relationships seriously, right? Those are people and some of them have been, I mean we have contractors that have been with us for 10, 11 years now, right? And so again, you know, I don't want to make it sound like those cuts were something we didn't take seriously. We took them very seriously and we were trying to avoid them. And then again, the last in our list was staff beyond that we actually didn't have any meaningful line items, but we knew as we were tracking the business day to day that if we got further and further, we know we were starting to let go of contractors, we're gonna start to get very nervous because at that point we knew staff was next and we knew at that point we were making very difficult decisions, but we knew what it was. In other words, when we're laying awake 3:00 AM, staring at the ceiling going, what the hell is going to happen here? We weren't thinking just about one thing like oh my God, there's this thing called failure were specifically saying if we hit this next threshold, if this next dollar doesn't come in, then I have to call that person specifically and tell them that it's not going to work right? Having those logic gates defined ahead of time is smart for a lot of reasons. One of the things we don't think about is if you hadn't done that, had we not gone through those exercises, were we making those decisions on the fly in real time under unimaginable stress and duress. Do you think we would have made as good a decision? Right? And you forget about that. You forget about your ability to objectively make a decision. Okay. Things weren't good at the time, right? We were staring at a global pandemic but we weren't in a position where it was like tomorrow we have to cut the staff right? If you wait until that moment to think about exactly what that looks like, it's a much harder decision and the likelihood that you're going to get it right and survive it emotionally is way, way lower, right? And look when we worry about things, we tend to scale up to the biggest worry. In other words, the monster gets a lot bigger, always. And if we're sitting there thinking, okay, you know, things are going sideways, my wife's gonna get piste and leave me. That's actually not what's happening. You know, if things go sideways, we're gonna lose our office, that's that's not the same thing, not quite the same thing. Or if things go sideways, the business is gonna fail and everyone's gonna think I'm a huge failure. No, the business is gonna fail and no one's gonna give a sh it, right, It's gonna be a discussion for a day and then no one's ever going to think about it again. Except you right again, these are all the things we kind of need to unpack in detail so that if we are worrying, we're worrying about the things that actually matter because they're actually going to happen. You know what I mean? It's about, you know, detail and and having the right level of of kind of breaking these things down into their constituent parts so that you can then prioritize right? And you know, it wasn't that we automatically knew like here's the order of events, Here's exactly what we'll do. We had to sit down and talk about it right? It's not simple. It's not basic mathematics, right? It wasn't just looking at our P. And L. And going, okay, let's just subtract these line items. They have varying degrees of impact, right? So we talked about cutting marketing spend Which we did but it wasn't like we just said, Okay just arbitrarily cut $20,000 from our Google spend. We said how is that going to impact revenue because that's gonna impact next month which is going to impact our ability to keep staff around, keep things going. Right? So it's calculus, right? You're looking at it change over time and it's extremely complicated, luckily we're fairly good at forward planning. So we know what we should expect from those things. So we know when it's time to cut what that means. But even in the same way, you know, a lot of the contractors that we have are part of our cost of goods sold but they're part of our cost of goods sold, right? So if you're still anticipating and selling goods, those costs are important, right? If that means now we can't generate revenue that we otherwise would have generated from that contractor. It's a bit of a problem, right? Because now we're cutting off our nose to spite our face. So it's extremely important that we get really detailed about the what the why and how that impacts our ability to survive these situations, right? How the downside management impacts future upside. Well here's what's interesting if you mentioned upside, let's flip it on its head. Let's talk about why having the downside strategy allows us to make a really powerful upside strategy because at its core and this has been what's defined us as a company for nearly a decade. The reason we can make what I'd call cowboy moves right? Like acquiring virtual or anything else that we've done is because we've laid out all the downside, more importantly we've checked off on it, we've all said, okay, we get it right, we understand what could happen, so it's no longer a bogeyman in the closet, so now that we know what it is and we're willing to accept those different thresholds now we can get pretty damn aggressive with making big bets on the upside because we kind of know what to expect and I'll give you a good example here, this kind of cracks me up as I think about it when Sarah and I go to the casino in Vegas or wherever else we're at, we always get the same amount of money on the blackjack table, which is kind of our thing, it's never that much money because I think Alex Trebek said it best, he said, I don't do gambling because winning winning brings me very little pleasure and I fucking hate to lose. So that was a great quote, absolutely perfect. And so basically what happens, we go to the blackjack table, you know, we bring a modest amount of money and we put it down and we have this weird cadence between us where I always continue to win and she always continues to lose and it's a bit of a battle to see who can beat the other. But my wife has this great strategy where what she does as she's losing is she takes all of my chips as I'm winning and she's very specific about making sure she takes all the chips off the table that we essentially bet. So that without realizing it, we're playing with house money. And so this is very similar. This is where, because we know, you know, we've kind of established and kind of locked in what those downsides are, we're allowed to make big bets because at that point we're playing with house money but were very specific in our strategy here about what house money meaning things we can afford to lose and stuff, we can't afford real money, which we're going to pay for dinner with. And I think having that separation does something really cool actually, having this discipline does something really cool. It allows us to look at our upside strategies and start to apply what I'd call these micro downside strategies and, and Ryan, you and I do this like every other day, hey, if we're going to spend more money on this and it works again, that's never a hard problem to solve. But if it doesn't work, what will it affect and what are we going to do about it, correct? And once again we check it off, we agree on it and then we move and take another swing. And more often than not, it doesn't work. That's the nature of how this goes. But because we already knew what was going to happen if it didn't work, I don't want to think about it as much. And I think that's powerful. What do you think? Absolutely. And you know, it's it's kind of like the shield wall behind us, right? And we just kind of keep moving it forward, acknowledging it forward. And, you know, we set that in a way that we know should this not work, here's the farthest back we're gonna fall based on this decision, right? And and to your point, you know, having that downside strategy in place is what allows us to take the swings right? Big swings, small swings. And that depends on how well you can manage or anticipate the downside, right? I can't think of a situation that we've put ourselves into in the history of our business where we took a swing where we weren't sure that we could manage the downside, where we hadn't quantified it to the point or had some sort of an escape hatch ripcord for a parachute where we knew we could hard limit that downside. You know, we haven't taken risks that said like, okay, let's bet the farm on something and hope for the best because if it doesn't work out, it's not entirely clear how far back we're going to slide, We've done a wonderful job of saying for each bet that we place, we've got a backstop in place that allows us to say we're not going to backslide any further than this. Right? Exactly. And I think if you're going to be in the startup game, if this is what you plan to do for a living in many people listening have been doing it for a while getting great, not just good at building these downside strategies, these detailed strategies, opening up the conversations with co founders, partners, people that are affected to say, look, let's be okay with having some downside discussions. Let's not shy away from it because it's a tough conversation because once we've all bought in as to what the downside conversation needs to look like and we've all bought in as to what those variables can be, kind of, what we're willing to accept. It allows us to be wildly ambitious about how we can drive upside. And I think that's the key to the way most founders think about their business. Alright. So that was fun. But let's actually keep this conversation going. You've heard what we think about this, but you know, Ryan and I would really like to hear what you think and we're online, like all day long, pretty much talking about every startup topic you could think of from fundraising, the customer acquisition to just really have to get all of this crazy startup stuff out of your head and there's tons of other founders just like you, they're weighing in on these topics so you'll get a chance to just hang out and meet some really smart founders were also super, super easy to find. You head over to groups dot startups dot com and let Ryan and I hear what's on your mind. Let's get to know each other a little bit and let's just start having more of these conversations.