Jeff Bezos

`2:38:39`

— How do you protect the small team. Basecamp has successfully stayed small. Has been the dragon, and you had to fight off. That like basically you make a lot of money. There's a temptation to grow. So how do you not grow? — Don't take venture capital. — Okay, that's step one. — That is point number one. — First of all, — Point number two everybody takes venture capital. So you already went. — I mean that's been the answer for the longest time. Because the problem isn't just venture capital, it's other people's money. Once you take other people's money, completely understandably, they want a return and they would prefer to have the largest return possible. 'Cause not them sitting in the code. It's not them getting the daily satisfaction out of building something. Chiseling beautiful code poems out of the editor, right? They don't get that satisfaction. They get the satisfaction maybe of seeing something nice put into the world, that's fair. But they certainly also get a satisfaction of a higher return. And there is this sense certainly in venture capital, stated in venture capital that the whole point of you taking the money

`2:39:41`

is to get to a billion dollars or more. Now the path to that usually does go through running established playbooks and then when it comes to software, the enterprise sales playbook is that playbook. If you're doing B2B software SaaS, you will try to find product market fit. And the second you have it, you will abandon your small and medium sized accounts to chase the big whales with a huge sales force and by then you're a thousand people and life sucks. — That said, I mean people are just curious about this. I've gotten a chance to get to know Jeff Bezos. He invested in Basecamp, not controlling? — He bought secondaries. So this was the funny thing is that when investing have these two dual meanings. Normally when people think about investing, they think you're putting in growth capital because you want the business to hire more people to do more R&Ds so they can grow bigger. Bezos didn't do that actually. He bought a ownership stake directly from Jason and I,

`2:40:44`

and 100% of the proceeds of that purchase went into my and Jason's bank account, personal bank account. Not a single cent went into the account of the company 'cause we didn't need the money to grow. What we needed or what we certainly enjoyed was to some extent maybe the vote of confidence, but more so the security of taking a little bit off the table is that we dare turn down the big bucks from venture capitals. It was essentially a vaccine against wanting to take a larger check from people who then wanted to take the company to something enormous that we didn't want to go with it. So Jeff gave Jason and I just enough money that we were comfortable turning all these people down in a way where if it had turned belly up like six months later, we wouldn't have been kicking ourselves and going, we had something here that was worth millions and now we have nothing and I have to worry about rent and groceries again. — It is a vote of confidence.

`2:41:45`

I wonder from, I'd love to hear Jeff's side of the story of like why, 'cause he doesn't need like the money. So it's really, I think it probably is just believing in people and wanting to have cool stuff be created in the world and make money off of it, but not like. — 100% the motivation for Jeff wasn't a return, because he actually has a team. He's private office that runs these investments who did the calculus on the investment pitch we gave him, which was so ridiculous that Jason and I were laughing our asses off when we were writing down our metrics. I was like, no one's gonna pay this. No one is gonna give us this multiple of this amount of revenue. And that's fine. I mean we took the call essentially out of kind of an awe that Jeff Bezos even wanted to look at us and like, do you know what? We don't want venture capital. We don't need other people's money, but like let's just give him a bullshit number that no sane person would actually say yes to. And then I mean, we can each go our own way.