- Today, we're looking at
some of my biggest lessons for you,
as a founder, or as someone starting out in your career.
Things I learned the hard way,
like you've got to be contrarian and right.
You've got to learn or earn.
And if you're a startup and you're running out of gas,
you don't stomp on the accelerator,
you've got to coast.
In this video we're going to talk about how to use design
to create a billion dollar startup,
how to avoid wasting millions of dollars on a leaky bucket,
and how you're more than just your resume.
You're not an object of trade.
You're not a number.
You're a free human being.
I'm so glad you're watching this channel
because we're here to help you learn
to create a great business.
And yes, maybe a startup that touches a billion people.
Let's get started.
(enchanted playful music)
Here are the key lessons for you from the Coinbase story.
Be contrarian and right.
Can you find something that is fringe, but ultimately right?
Is there something from history
or psychology or first principles bottom up thinking
that can help you justify your crazy idea
and why it's going to take the world by storm?
Sooner or later, every crazy idea will have its day
but only if it has a truly compelling pitch.
If you start a company or are early enough,
you can learn while you earn.
For founders, this is easy math.
As a founder, when you start a company,
you start off with a hundred percent of the pie.
The pie might be worth zero at that moment
but you're going to go make it worth something.
If you do manage to get to product market fit
you could have a company with an exit
in the tens of millions, hundreds of millions,
or billions of dollars.
If you own 10 to 30% of that company by then,
you could be centimillionaire to billionaire.
That's pretty crazy.
When I got my first job cold calling the yellow pages,
I was happy getting paid $7 per hour, then $10,
then $20 an hour to write code.
But what I wish I knew earlier was that
I have a really finite number of hours in the day
and in my life. You can get the 60
or 70 hours per week of work, but beyond that, you run out.
But if you make a product that can make money for you
while you sleep, that's leverage.
I actually have another announcement to make.
I got my first YouTube sponsorship.
We do sponsorships a little differently here
and so I wanted to promise two things.
One, I'll only promote brands that can actually help you,
founders, designers, coders, and builders, no BS.
And two, all of the proceeds will be donated to charity.
The money doesn't even hit my bank account
and is directly donated to Code2040 to make sure
we create as much change as possible, especially in tech.
We looked for the perfect first company to partner with
and I'm happy to say we found Tydo,
whom a lot of you could probably use right now.
Tydo is an analytics software for direct to consumer brands.
They just released report cards by Tydo
which provides automated metrics
directly to your inbox for free.
It's super easy to connect your data sources
to get a daily, weekly, or monthly pulse on your business.
Overall, the team at Tydo is doing
some really innovative things to democratize analytics
and you should give them a look
if you have an e-commerce brand of your own.
I'll share the link to report cards in the description.
Now back to those tips for your next billion dollar startup.
If you have to cut, do it once
and do it as deeply and as humanly as you possibly can,
just so that you can avoid doing it again.
Figure out a plan that's realistic and attainable
to get you to the next station.
Sometimes people want to stomp on the accelerator
and the reality is I've never seen that work.
If you're in a car and you're running out of gas,
you don't mash on the accelerator
to try to run out of gas faster.
You try to increase your efficiency by reducing your speed.
And you'd be surprised how often this can work.
Especially if you need just a little bit more time
on product engineering, to dial product market fit,
or to pivot slightly to a different market.
Ray Dalio talks a lot about meditation
as a key force for why he was successful.
He says, "It helps to slow things down
so I can act calmly even in the face of chaos,
just like a ninja in a street fight."
I really like that quote a lot.
Chaos is going to be a given.
Conflict is a part of life.
But if you can notice your many selves
and break apart what you truly want
versus your modeling of others,
then you can reach Kegan's stage 4,
a life that is truly authored by you.
First, delabel yourself.
Know that you don't need a permission slip
or stamp on the forehead to do design.
Then empathize with others.
If you can walk a mile in the shoes of your users
you'll understand their wants, needs, and motivations
and you'll be able to make their lives better.
Third, illuminate what's important.
Be opinionated and have a firm handshake.
Show the path forward and your users
will be happy instead of frustrated.
Next, minimize what's not important.
Get rid of ornamentation
so that the things that truly matter
can rise to the highest levels of attention.
And finally, create.
Create great UI, create great layouts.
Use contrast, closeness, and grids to translate
how it works or interaction design
into a visual design that supports your goals.
Being a designer isn't anything fancy it's,
if anything, just applying simple proven principles
to your life and your work.
Now, if you can't win the internet,
sometimes you can buy it.
Yes, I'm talking about Google Ads.
You could also call this strategy
search engine marketing, for short.
My wife actually worked at Google for a few years
as an ad optimizer in their operations team.
And the craziest story I remember
from hearing about her work was that some of her clients
were actually literally doing colonic kits.
So, colon cleansing.
But some of them started off as tiny operations,
maybe a hundred to a thousand dollars a month.
And as they made profit, they reinvested in it
to get to as much as a million
or $10 million a month in revenue.
That sounded crazy to me.
But now I realize that's actually relatively common.
There are all of these ways
that you can reinvest your profits in SEM.
If you can buy ads and make more money from them
than you paid for them, it's a powerful engine for growth.
It is not that common, but it still does happen.
(upbeat music)
Sometimes people spend a crazy amount of money on growth
when they don't have retention figured out.
What's retention?
It's how many of your customers stick around and how long.
Retention's inverse is churn.
Churn is the percentage of people over a time period
who left and didn't ever come back.
If you had 6% churn in a month
it means 94% of your users were retained.
Here is an amazing resource from Lenny Rachitsky.
You should go Google it.
And there's a link in the description for this.
It goes into what does retention look like
for different types of businesses?
Now let's break down
the two types of retention mentioned here.
First is user retention,
sometimes called logo retention.
This means if a customer signs up,
how many of them are still using you six months later?
So if you just launched and you only have one month of data,
how do you figure out what your six month might be?
Let's say in month one, you kept 95% of your users.
Then you can do 0.95 to the sixth power
which equals 73% user retention at six months,
by all accounts, at that point, you'd say, wow,
I have something really special.
Across all the different types of businesses,
this is amazing user retention.
So that's it.
Thanks for watching all the way to the end.
We covered a lot of ground this year
and this year isn't even over yet.
All the videos we covered today
you can view in the description below.
We go into detail on each of these topics,
how to design,
how to start your startup,
how to grow your startup
and what you need to do to reach your full potential.
Thanks again to Tydo for my first charity sponsorship.
Link in the description.
And please click on that to help us continue
to build this channel into something that helps
a lot more people get into tech.
I really appreciate every single one of you.
Please like, click subscribe, and hit the bell icon
to make sure that you see every single new video
we post every week.
We're trying to help a new generation of founders
build things for a billion people.
If that's what you want to do, then you're in the right place.
Thank you again.
I'll see you next week.
(bright upbeat music)