Some tech companies are worth billions of dollars. But the vast majority are not, and should stop raising money like they could be, says Basecamp CEO Jason Fried.
“Raising a bunch of money, and raising way more than you need, it ends up stunting people’s actual growth as businesses. It destroys businesses,” Fried said on the latest episode of Recode Decode. “It’s like, look, you know, you plant a seed, it needs some water, but if you just pour a whole fucking bucket of water on it’s going to kill it.”
Fried told Recode’s Kara Swisher that venture capital “kills more businesses than it helps” because the pressure to grow crazy-fast means companies keep raising money to keep their growth rate up. That, in turn, means they rarely have the opportunity to learn how to spend money in a disciplined, sustainable way.
“If you have a bunch of money in the bank, you’re encouraged to spend it because no one ever ... Well, I shouldn’t say no one, but hardly anyone ever goes for one round,” he said. “It’s round A, round B, it’s like, you’re going back to the drug dealer.
“Lots of businesses could be great $10 million, $20 million businesses, but they’re not allowed to be,” he added. “[They’ve] got to be $200 million or $500 million or a billion ... One of the reasons you get into entrepreneurship is to control your own destiny to some degree, to not have to go work for somebody else, to not have to collect a paycheck from somebody else. And so the thing is, when you go take money, you’re working for someone else again, instantly.”
You can listen to Recode Decode wherever you get your podcasts, including Apple Podcasts, Spotify, Google Podcasts, Pocket Casts and Overcast.
Below, we’ve shared a lightly edited full transcript of Kara’s conversation with Jason.
Kara Swisher: Hi, I’m Kara Swisher, editor-at-large at Recode. You may know me as someone who hoped to visit Everest Base Camp until they told me I couldn’t drive there. But in my spare time I talk tech, and you’re listened to Recode Decode from the Vox Media Podcast Network.
Today in the red chair is Jason Fried, the founder and CEO of Basecamp. The company’s products include the project managing app, Basecamp, which is super popular, and an online chat service for coworkers — it’s one of the first out in the chat services — called Campfire. He’s also the co-author of several books, most recently It Doesn’t Have To Be Crazy At Work. Jason, welcome to Recode Decode.
Jason Fried: Thanks for having me on.
Just so you know, you’re known to be a very funny guy so you better keep up with me here.
So let’s talk a little bit about Basecamp and how you got to do Basecamp, because Basecamp is one of the first... There’s been a lot of these, and there’s all kinds of different things, but you guys were one of the first to think about a different workflow. Way before Slack, way before anybody else. All of it.
Yeah, way before. Yeah, 2004.
Yeah, I remember. I remember when you debuted.
Yeah, way back when, 20 years almost.
Talk a little bit about your background and how you got to Basecamp, because you did a bunch of other things before that.
Sure. Well, before Basecamp, I was freelancing doing website design.
Right. Which a lot of early internet peoples were doing, so don’t be embarrassed.
That’s where I started, basically. Oh, I’m not. Yeah, ‘96, I was in college, the internet was starting to hit, so I started doing that stuff and learned how to do that. Built a small business, but mostly just myself. And I kinda got bored working for myself so I worked with a few other people. And we started getting really busy doing client work, and we needed a better way to manage the work. We were using email, phone calls, in-person meetings, and it was a mess.
So we started to look around at product management tools, or project management tools, and they were all really complicated.
They were a mess. Hard to use.
Remember the physical books, what was that thing called where you ripped off pieces, and...? Remember those?
I do. At the time it was ... Microsoft Project was the big thing.
These were solving different problems than we had. I didn’t even recognize these problems. And so we built our own tool to use internally. And our clients were saying like, “What is this thing you’re using?” We said, “Well it’s just this thing we made. I don’t know, it’s just this thing.” And they were like, “Well we have projects and we can’t figure out how to make them work either. Can we use your thing?” We said, “No, it’s not really a thing, it’s just our thing.” Enough people asked us about it that we decided to build it and turn it into a product.
So we did that in 2004 and put prices on it.
And talk about what the concept is around Basecamp.
Yeah, so every team needs a series of tools to work together. They need a way to make announcements to one another, and they need a way to do real-time conversation, and also slow-time asynchronous-style conversation. You need to keep track of what needs to get done, who’s responsible for doing it, when things are due, documents, notes, that kind of stuff.
Today, a lot of companies piece together five or six or seven different apps to make this work. Basecamp is one single app that does all these things in one place. So while a lot of tech people love to piece shit together, most small businesses do not. They don’t have time to shop for this stuff, so they want one place to go, and that’s what Basecamp is. It’s all of these tools in one place that work together.
All right. So, you started in 2004, which was well before a lot of, there’s been like a million since then.
Now there have been, yeah.
Yeah. Yeah. What has changed in the way people work, in that way of people willing to do it that way? I’m just trying to think, there’s Trello, there’s Slack, they’re all different.
Different takes on it, yeah.
Everyone’s got a different take, which is great.
What’s the one that the Facebook guy did?
Asana. Yeah. Meditation.
You’ve got all of these. There’s literally probably 100 of them.
Right. I like the name Basecamp. I’m sorry, I get it.
It’s a simple one. Right. Right. Exactly.
Don’t meditate at me at work. Work is not meditative for most people.
It’s not. It’s not. For us, in 2004 the big challenge actually then was, “Can I put my data online and even think it’s safe?” People were afraid to bank online back in 2004, so we had different challenges back then. But fundamentally it was like, “Who owns the data? Where is the data? Can I get to it whenever I want?” That kind of stuff. Those were the challenges back then.
But what’s changed is the advent of real-time communication in workplaces. So things like Slack and chat tools, which I think are terrible ideas, in general.
I wanna hear why.
Yeah, I’ll tell you why.
Okay, we’ll get to that.
And we actually used to build one. We made one called Campfire, and it’s still in Basecamp. But, as a primary method of communication, real-time communication is a bad idea in most workplaces most of the time.
Because people do other things, like talk about Game of Thrones.
That’s okay. I’m okay with that actually, occasionally. What I’m not okay with is being interrupted constantly. People cannot get their work done at work anymore because they’re being constantly interrupted by all these real-time tools.
You’re 100 percent right.
And it’s busted. This is not progress. This is regression.
So Basecamp is more focused on asynchronous communication, which is more like email style, slower, longer form, not one line at a time. But I’d say lately one line at a time has become popular. I think it’s gonna turn around, though.
Okay. All right, so you’ve evolved the project management app to do basically the same things, which is a format of doing project management together.
Yeah. Communication, scheduling, tasks, files, all that stuff in one place. It’s kinda like if you think about, you want a ... A company needs a central source of truth. One place where they can go to know that everything that they need to know is there, and it’s the final version. And that’s what Basecamp’s really for. Yep.
So one of the things you did when creating this company ... how many people do you have there?
Fifty-five. We’re intentionally small.
And you’re where?
Mostly Chicago. Actually, not mostly. We’re mostly remote. We have 15 people in Chicago, and then the rest in about 30 different cities around the world.
You and WordPress.
Yeah, WordPress is 100 percent. But we’ve always been remote since the fourth employee.
Right. This is interesting, you use the word “intentionally small”. I just recently heard ...
Oh, I hate big companies.
Right. Yeah. Intentional. I just interviewed Emily Weiss from Glossier last night, and she’s like, “We’re doing intentional growth.” And I was like, “What?” And she goes, “It means staying small when I feel like it.” You know what I mean?
It was, “I’m not gonna grow just cause they want me to grow.” It was really interesting.
Well who’s they? That’s the problem.
That’s the problem, well, there’s the problem right there.
Yeah. Right. We’re gonna get to VCs. I promise, I’m gonna give you an entire ...
“You can’t stay small.” All right, I will just hold off.
You hold off on the VC rant because I am here and down for you.
You’re gonna tee it up for me.
I’m just not gonna say anything, and I’m just gonna let you go on.
But let’s talk about your company. So you created this company.
And it’s where the book came out of?
Yeah, we’ve done a few books. Rework is probably our most popular book. We launched that in 2010 so it’s been awhile. Then Remote, we did a book on remote working. And then It Doesn’t Have To Be Crazy At Work. So, my co-founder and I, we write the books together.
Right. So talk about them.
Yeah. Every five years we write a book, basically. And it’s about our point of view on the industry, on work. It’s basically, we think of it as ... I’ve always been inspired by chefs. So chefs write cookbooks and they share their recipes. They’re not afraid of somebody buying that book and opening up a restaurant next to theirs and putting them out of business.
A lot of businesses, though, however, typically they hold things close to their chest. They think everything’s proprietary and important, and it’s not. So we just share. So basically our books are our recipes on how we do work and how we think about work and how we think about growing a company, and marketing and not taking money and working remotely and working calmly and doing 40-hour weeks and eight-hour days and thinking that’s enough versus going crazy.
So these are just our thoughts. And every five years we have enough thoughts to put into a book.
Okay, so talk about how they’ve shifted from one to the next, from the first ...
Yeah, so Rework, the first book, was basically about ...
This was what year?
2010. Was basically our point of view on building a small business. So that was more about building the business. Staying small, here’s why we stay small, here’s why we didn’t take money, here’s how we market, here’s how we promote the products, here’s how we promote ourselves, that sort of thing.
Remote was all about how to work remotely. People are like, “How do you do this?” So here’s how we do it. Here’s the 80 different essays on how to work remotely, how to build teams, how to do marketing remotely, how to build culture remotely, how to hire remotely, how to work with people remotely when you can’t see them, that kind of stuff.
And then It Doesn’t Have to Be Crazy at Work, which just came out in October, is all about pushing back really hard on the current trends in work which are ... Everyone’s like, “I’m super busy. It’s crazy at work. I’m working the weekends. I’m working at night. I have no time to work during the day so I have to work whenever else I can. My schedule is packed. My inbox is blowing up. Chat’s blowing up. I’m paying attention to a million different things at once.” I think that’s all completely broken, and completely unnecessary.
So the book is all about why we wanna push back hard against “It’s crazy at work,” and think that you should instead build a calm company, one that works steadily, carefully, thoughtfully. Forty hours is plenty of time. If you can’t get it done in 40 hours, cut stuff back, don’t add more time. Have small teams of three or fewer people. All of our points of view on really keeping things calm and small and frankly easy versus making it hard on ourselves. I think a lot of companies make things too hard on themselves.
All right, well, let’s unpack that then. Let’s talk about some of the themes that you talked about in the book itself.
Sure. The first thing I’d start with is protecting your time and attention.
I gave a talk, this Ted Talk, a number of years ago called “Why You Can’t Get Work Done at Work Anymore.” And the whole premise was that we work all day. We’re at work all day, but we’re in meetings all day and our time is scattered. Right?
We have 15-minute blocks of time. You can’t get really good, thoughtful, creative work done in 15-minute blocks of time. So you might be at work for 8 hours, but you have maybe if you’re lucky 17 minutes to yourself in a given day.
And so then you have to work the weekends. You have to work at night. That’s why you get work done on planes, because no one’s bothering you, and whatever. So, for us, the most important thing for me as the business owner is to make sure I’m protecting my employees’ time and attention. If they can’t have a full eight-hour day to themselves, I’m making a mistake, I’m not doing my job.
So for me the goal is to make sure that we have full eight-hour days to each person so they can control their day themselves. So we have no corporate meetings, no company-wide meetings at all. We don’t have any meetings. We don’t share schedules. We can’t see each other’s calendar. We can’t do any of the things that makes it easy to take other people’s time from them.
So in the book we talk about ...
Everyone’s a time thief.
We talk about this in the book. We call it calendar tetris.
I won’t let anyone in my calendar.
You look at someone’s calendar, some blocks of color everywhere, and you’re trying to fit some slots in, right?
So that’s a problem. The fact that you can see somebody else’s calendar is a problem. It should be hard to get someone’s time. Modern technology’s made it too easy to get on someone’s schedule, and to claim, actually not even claim to steal time from them. If I wanna block an hour of your time, if you and I work together, I could go look at your calendar, invite you, you’re probably gonna say yes because most people don’t say no. And then before you know it your day is not yours anymore, it’s someone else’s. That’s a problem.
You cannot be expected to do great work if you don’t even own your own time. So for me, owning time is ... Owning my own time and making sure my employees own their own time is very important. No meetings. No calendar. Expectations: huge.
Okay, so before I finish that … when you don’t have that, there are some things you do need to talk about.
Sure. So, if I need to talk to someone, I have to ask them.
Ask them for time?
Which is what people do. Oh, don’t grab it. Don’t grab ...
Yeah, yeah. Different. So it’s like, “Hey Kara, are you free at 3 o’clock Thursday to talk about something?” And you can, we can have a conversation about that. And then you’re in control of your own time. You can go, “You know what, how about Friday at 1,” or something like that, versus me looking at a grid of your time and then just taking it without any humanity involved or any conversation involved.
Right. Yeah. Yeah.
It’s funny, because companies, they always talk about “time is money.” They don’t leave money out on the table, though. But they leave time out on the table. You can take anyone’s time you want. You cannot take a penny, though. And they have comptrollers and CFOs. And everyone’s watching the money, no one’s watching the time.
So that’s what happens, is people’s time is taken from them because no one’s watching it. No one cares about it.
And so it’s direct calling or texting or whatever?
Yeah. You could ping someone, you could email ‘em, you can go through Basecamp, you could talk. Whatever it is, however you wanna get in touch with someone, you ask for someone’s time. Someone’s time is valuable. Of course you should ask for it. And you should respect that someone else’s time is valuable and they’re probably doing their own thing so you better be polite when you ask.
And make your case, not just claim a block. So that’s how that works.
Most of the time though, still, we don’t talk directly to one another in real time. Most of the time is asynchronous. So I’ll post a message in Basecamp and someone will get back to me when they’re ready. So this comes back to the idea of the expectation of immediate response. In a lot of companies today there’s an expectation of an immediate response.
That’s broken as well. If I write something to someone and they get back to me four hours later, that’s cool. I’m fine with that. They get back to me tomorrow morning, I’m fine with that. Unless it’s an emergency, which should never happen anyway. People get back to me when they’re ready. I’ll get back to them when I’m ready. That’s the understanding we have at Basecamp. And that’s a cultural thing, and it’s really important. A lot of things in many companies are elevated to ASAP all the time, everyone thinks everyone’s in a hurry, and there’s no hurry. There’s really no hurry.
Right. Right. Right.
I don’t answer my email anymore.
There’s no reason to.
Everyone’s like, “You didn’t answer my email.” I go, “I didn’t see it.”
“Just email me again then.” Well I just delete mine like every ...
It’s like, “You didn’t read it?” I’m like, “I did not.”
”I shall not search for it, either. Just send it again.”
You know, if you’ve managed to find me this quickly ... It’s really a funny reaction I get.
The great thing about it actually, what’s cool is when you ignore your email, if it’s important, someone will remind you again. If it’s not, it’ll just go away. And that’s pretty much what I do.
Yes, it’s true. It’s true. There’s very few things that rise to the ...
Need to know now. Need to respond now.
Need to know now. It’s interesting. All right, so you don’t let ... people respond in their own time in a message, asynchronous.
Yeah, asynchronous, primarily.
Where did the ASAP culture come from? Just because these apps and everything are so, “Hello. Hello. Hello.”
Oh, it all ties back to business model, I think. I’m gonna kinda fall back to VC, right?
Go right ahead.
But basically it’s like, when companies raise a bunch of money, they’re expected to grow really fast. And when you’re expected to grow really fast, you’re expected to go really fast. And when you’re expected to go really fast everything’s just ASAP. That’s just the expectation. And it all comes down to expectations. We’re used to texting in our daily life, which is fine with our friends and whatever. You don’t expect an immediate response from your friend, really, necessarily. But at work, for some reason, it’s expected because this is important, these people are waiting on you. And there’s so many interdependencies at companies that if you take two hours, then everyone else has to wait two hours.
And so that’s another thing I think is wrong in modern workplaces, is that there’s far too many interdependencies between departments and people. I think people should be able to slide by one another rather than grind their gears. So for example, at Basecamp all of our teams are really small, three people or fewer. No two departments really depend on each other to get anything done. You never have to wait around for someone else to do something for you, you just figure it out yourself or you don’t do it at all.
Mm-hmm. Give me an example.
These autonomous small units. For example, any programmer at Basecamp can ship software to the public. In a lot of companies ... and some people would say that’s reckless. Okay, I’d say it’s a trade-off. In many companies you submit your software, some other engineer looks at it, some other engineer looks at it, some operations person looks at it, it’s scheduled for deployment, so there’s all these things in the chain that have to happen on time, and everyone’s waiting for each other to get something out. We just, we trust everybody who works for us. Everyone’s really good, and they get to the point where they can ship their own software and it’s just done. They can handle it themselves.
So that just makes it easier. They don’t have to ask someone else for their time. That other person ...
Cause a roadblock, or a funnel, or whatever.
Yeah, there’s so many roadblocks.
The gatekeepers and roadblocks, just get rid of ‘em, don’t need ‘em. Don’t need ‘em.
Mm-hmm. Yeah. Yeah.
And that doesn’t mean that some things don’t go wrong sometimes. It’s just a matter of trade-offs.
Or how many things go wrong versus ...
And most things don’t go wrong.
And most things don’t matter anyway.
You are correct.
So if there’s a problem, you deal with it and you fix it. But to think about, the cost of preventing every potential problem is so high compared to just letting a few problems happen and then getting away with all these other things for free, which I much prefer.
Right. Good point. Ask for forgiveness, not permission.
That one. Yeah, that one.
That one. That one.
Yeah, that one.
How did it get to be crazy? So, one was, is it tech, or what is it? It’s just the ...
Tech. Tech’s at fault. And by the way, some of these things are good sometimes.
Right. Give me something good.
I mean, look, real-time communication, for example, is handy sometimes. When there’s really a crisis or whatever and you really need to hash something out, fine. It’s just that when you have to follow a dozen real-time conversations all day long, that’s broken. That’s just broken. That’s like, the fear of missing out. We have what we call JOMO, the joy of missing out at Basecamp. We want people to miss out. I want you just to focus on your work. You don’t need to pay attention to a million things that are going on at once, right?
And so, you look at, you walk around coffee shops or you look in offices and you see a chat window open all day long. And their right eye is looking at that while they’re trying to do their work with their left eye.
And something else happens over here and they’ve gotta jump over here. Now they’ve stopped the flow, and they’re over here now responding to something one line at a time coming back, a new ...
It’s like being pecked to death.
It’s being pecked to death, that’s a great way of putting it.
And it’s like, it’s bonkers. But tech enables it, but also I think the tech company mindset ...
Which has infected everybody else.
Yes, it fertilizes it. And then it grows into this really horrible monster.
Yeah. And everyone’s trying to be a tech company. Everyone’s trying to model themselves after Silicon Valley companies, which I think is just a terrible idea.
All right, we’ll go into that in a minute. So what is another thing that happens?
What do you mean?
In the workplace. What is another thing that makes it crazy?
Yeah. Well, other things that make it crazy, I mean ...
Or that you get rid of to stop being crazy so it doesn’t have to be crazy.
Yeah. One of the things that’s really difficult, I think, for a lot of people is to work on something that never ends. A lot of projects at companies, they have deadlines but no one believes them. We call them “dreadlines.”
You have these phrase-y...
It’s fun, right? There’s a deadline, and then there’s a dreadline.
You should sell your consulting for a lot more money than you do.
No thank you. No, I probably couldn’t, by the way.
Okay. I’m just telling you, you could make some money.
No interest in that world. Used to do that. Not what I want to do.
It’s free advice.
Free advice is better. So anyway, deadlines, dreadlines. Dreadlines are deadlines that no one believes, that never seem to end. Projects keep going and people pile more work in and more work in and more work in. It just drives everybody nuts. It’s like, “When’s this going to ship?” And, “Oh my God, I thought it was going to ship Friday and it’s not going to ship Friday. They want us to do more stuff. Now we have to stay the weekend.” And like all this false urgency that piles up makes people really, really crazy at work.
So we have this thing at Basecamp where we only work on something if it can take six weeks or less. If it takes longer than six weeks, we don’t do it. We break it into a chunk that’s six weeks max. That way, even if you hate what you’re doing, it’s almost over before you started.
Also, we don’t plan.
I like it.
Yeah, this is another thing we don’t do. We don’t plan. We have no goals. We have no revenue targets, no financial goals other than to be profitable, and no growth goals, no user growth. None of that stuff. I think that’s another thing that makes people crazy.
So just, let’s see how we do.
Let’s just do our best work. We should be doing our best work anyway, so let’s just do that. Versus like making up some bullshit number. Like, “Let’s do a whatever, x million something this year.” If you either hit it, great, then if you beat it, then it wasn’t high enough. If you hit it, fine, then you make up another one next year and if you don’t hit it then you feel bad. Like, why put any of those pressures on you? Just like do the best work you can and you’ll be fine.
The problem is, though, that expectations are so out of whack for so many people because you’re often working for somebody else. You’re not working for the company or for the customer. You’re working for a billionaire who wants to get a little bit richer off you, and so growth of multiples, valuations, all the stuff, that’s what drives people crazy because they’re aiming for that to move those numbers. And when you’re ...
You don’t mind measuring success, right? Like, “We did better this year than last year in this”? You don’t even ...?
Well, I know it.
If you stop doing something, if you start really losing money, then why even be doing it?
Unless you really super enjoy it.
I’m not. Yeah, I’m not encouraging people to lose money or hemorrhage money. We pay attention to that. But, for example, if we didn’t grow one year, eh, whatever. If we only grew 3 percent one year? Whatever, who cares? That’s fine. If we lose a percent? It’s fine. Like, it’s fine. It’s not fine if we’re down 80 percent, like that’s not fine. Right? But that doesn’t happen.
I mean, it could certainly and to every company it will at some point, but as long as we’re just moving in the right direction, as long as we’re profitable, as long as we keep our costs in check, I’m fine. So we’ve been profitable every year for 20 years and that’s how long we’ve been in business and that’s the goal for us. If there is a goal, it’s just remain profitable, which means that if we’re profitable, we can stay around as long as we want. And that’s ...
But you don’t have goals of hegemony? You don’t have any of those?
No, absolutely not. Completely against that.
You have to remove the hegemony part.
You have to. And that’s the other problem, I think, with a lot of things in Silicon Valley and of the model that’s sprung up there, which is world domination, which is hegemony. It’s having massive influence. It’s dominating a market. It’s owning the market. It’s all these warlike, bellicose terms, and it’s like, “We’re going to conquer this, we’re going to take that. There’s a talent war we’re fighting.” It’s all this war language. I don’t get it.
I think most of America does that. I don’t know if you’ve noticed.
Yes, but it’s especially bad in tech. Don’t you think?
Politics is doing a pretty good job.
Well, yeah. But politics has kind of always done that.
This tech thing feels like ...
Some days I’d rather them just take up swords. I’m like just ...
Just fight. See who lives.
Just fight and see who lives.
We know who would live. Not many of them.
No. They’d all kill each other.
They would. Which among the tech executives, I wonder.
The tech executives? Well, Bezos looks pretty buff these days. He looks buff.
Yeah, once again.
I think Cook. I think he’s very crafty.
You think so?
Yeah, I think he’s fast.
Like he’s kind of sly?
He’s fit and fast.
He’s kind of slippery? Yeah. Yeah. He is. He does appear fit.
Benioff would be hard to take down. He’s a big, big man.
He’s big, big man. Yeah.
That’s actually maybe easier, though.
Big tree, hard fall, they say. Yeah.
Right. Go for the knees. Go for the ankles.
Take that right off, right.
Anyway, let’s not talk about murdering tech executives. So give me one or two more and then I want to talk about VCs in the next section, but talk about a couple more.
Another thing that bugs me are specifically like tech benefits, benefits and quotes. So there’s many companies out there that will cook you dinner at night or do your dry cleaning. Those are all ...
And they become expectations of pretty much everyone in tech.
Yes. All those things are designed to do is keep you at the office longer. That’s crazy.
Right, they are.
It’s not about going home. It’s about, “Well, don’t go home. We’ll make you dinner for free,” or, “We’ll drive you to work and pick you up, but the shuttle leaves at 7:00 am and drops you off at 7:00 pm, but we’ll take care of it for you. It’s 12 hours, but don’t worry. We got you.” That kind of stuff really bugs me, and I think that drives people crazy because there’s an expectation, again, if you want to be a team player, everyone has to stay in late, the company is encouraging you to stay late. “They’re going to cook you dinner. Like, why wouldn’t you stay?” You know? And my teammates are going to be having dinner so I got to stick around. It’s crazy. It’s unnecessary.
I was at a company today and they’re like, “This is our workout area.” I go, “Yeah, they really love you.”
And they’re like, “No, you want to just keep us here.” I’m like, “Yeah. Bingo. Thank you.”
Yeah, that’s it. They’re magnets.
It’s fine if you like working out.
They’re trapdoors, all these things. I mean, look, I’m being a bit cynical.
Do you not even serve a chocolate bar at Basecamp?
Well, what we do is we provide things for people at home, so we do a CSA share, farmer’s market thing for everybody at home so they can have fresh fruits and vegetables at home, not at work. We have a massage benefit, but it’s at a massage place.
It’s not in the office.
Well, if you’re hovering over your ... or you’re hunched over your keys and you get a 15-minute chair massage and you have to go back to hunching over your keys, that’s not relaxation.
That’s a fair point.
So you go home and you ...
It’s a massage trap.
Yeah, it’s a massage trap. It’s fake. It’s all this fakeness.
Of course it is. Yeah, it’s ridiculous.
So we do things like that. We send people away on vacations that we pay for. So not only do we, of course, encourage vacation time, but we pay for your vacation. So every year we put together a list of between 10 and 15 amazing trips around the world and everyone gets the list and they get to pick and it’s on us. It’s about $5,000 bucks per employee we spring for, and they can take their spouse, partner.
What you saved in kombucha, right?
It’s a bargain, right?
Kombucha is expensive.
Yeah, it is. Especially on tap.
The ones homebrewed by tiny, tiny people.
Tiny little leprechauns or something. Yeah.
Like they do at Google.
Because that’s especially good.
It has to be. It has to be. So yeah, we provide things that we say, get out of the office, go home, have a real life, see the world, see some stuff. We also will pay ... for example, if you want to be a ceramicist or potter or whatever, we’ll pay for those lessons for you. They have nothing to do with work, but we’ll pay for that to help you develop yourself outside of work. It doesn’t have to be ... you don’t have to learn your trade. Like, you can learn other things and we’ll support you too.
So that’s our take on benefits versus the take, which is like stay at the office longer.
Stay at the office longer. Are there any benefits you like among the tech companies?
Well, yeah, certainly.
Some of the healthcare ones are great.
Health care is fantastic. I also think that the tech world does take a lead, is taking a lead now in things like maternity and paternity leave, because in the United States it was zero. It’s ridiculous.
Yes. I was married to a Google executive and I have to tell you the comparison. My work was like, “When are you getting back?” I had a Caesarean and they were like, “15 minutes. Will that work for you?” And it’s was like, “Well I’m bleeding, but all right.”
“You can still type.”
And Google showed up literally with like a month of free food at home. Nurses in and out the door, a basket of diapers. They all had “Google” on the ass, but it was fine.
Were they branded diapers, really?
They were branded diapers.
Were they really?
They had something in there. Yeah.
That just shows...
But it was fun. They were good.
Yeah, it’s fun.
Let me tell you, it was fantastic swag and there’s nothing wrong with it and I don’t care if my kid wears a Google onesie. I don’t care.
Those benefits I think are, those are good.
It was astonishing. It was caring. It was really actually well done.
Yeah. And so I think that they’re doing really well there. And some health care stuff and certainly there’s some other things, but I think a lot of these things are subversive.
Yeah. It’s just, “Don’t leave, don’t leave.” Like this is like the dream of Utopia where everything you need is under one roof. Well no, everything you need is not under one roof.
It’s college campus.
It’s that style.
Well, it’s juvenilization of people, and I think that’s what’s happened in a lot of these companies, which led directly ... Some of the other problems is it’s a constant juvenile coddling of … mostly men and it is eternal college campus. You don’t have to pay for it. In fact, you get paid, but then you don’t have time to spend the money you made, except on stupid shit. Thank you.
Yeah. Like at the company bookstores. Yeah, I agree.
And planes. I’m thinking planes.
Oh, those things. Yeah. If you, yeah sure.
And then they go off the deep end on the other side, when they start to slow down, they just disengage.
They just disengage and then like go to Fiji for the weekend.
Yeah, but that just doesn’t last very long. You mean talking about like people sell their companies and they go.
Yeah, like then it does, then they just don’t want to work at all, which ... I think work is kind of fun.
Yeah, for a while and then they always get back to it — which is, by the way, one thing I think is important here. I want to mention. I don’t understand serial entrepreneurship. Don’t understand that. I’m proudly a non-serial entrepreneur. I’ve been struck by lightning.
I get one good idea and I’m stuck. It’s sticking in my head.
Yeah. Why would I not? Like this idea that ... because I’ve known a lot of these people who’ve built a great business, they’ve sold the thing, and they’re miserable and they’re looking for the good old days again. They’ll never get them back, because it’s very hard to have one hit.
Yeah. I’m okay being a one-hit wonder. Perfectly, as long as I don’t lose the hit. Like, if you have a hit and you sell the hit and you have to make more music the rest of your life and you can’t, that sucks. So I’m perfectly comfortable doing one great thing, hopefully my whole life, and that’s great for me. But it’s weird, again, in Silicon Valley, you’re expected to come in for a while, do something and sell it or whatever and do something else and sell it and do something else and sell it. I don’t get that at all.
Yeah. It’s always diminishing returns, but nicer offices.
I was just in an office of someone ...
You’ve done that before?
And the office was spectacular, just spectacular. And I was like, “No, you’re really not going to be successful.”
Now, you’re screwed.
That’s always a sign for me. I’m like, “Uh-uh.”
Nice furniture, out. Bad news.
But I liked being there. It was lovely.
That’s good for you.
It’s very soft. Everything was soft. It was cashmere.
Soft and round. Oh, cashmere chairs and stuff too?
The whole place was cashmere. It was very soft and spare and beautiful. Very Marie Kondo and at the same time ... Anyway. Okay. One more and then ...
I give them two years and they’re gone now. That’s it.
Yeah. And they were like, “Won’t have time to talk?” I’m like, “No, I have no time to talk. If you have no information for me, I must leave.”
Nothing to say, yeah.
Right. So, last one, last one.
Oh gosh, I’m not sure what I’ve gone through now.
There have been 50 essays of these, right?
Yeah. We have like 88 of them.
I think one thing, too, is this following of the herd when it comes to work methods. A book comes out or this company has done this one thing this one way, and so everybody just thinks like, “This is best practices.” Best practices are crazy. They point to one example, they don’t have any idea why the thing was actually successful but they go, “Well, they do it this way so we’re going to do it this way.”
There’s this herd mentality and people are focusing on the wrong things and paying so much attention to what they call best practices. And I think oftentimes they’re really terrible practices. This idea that if you’re a small business, let’s say you’re starting out, you’ve got five people, six people, that you’re going to do what Apple does? No, Apple’s got, what, 20,000 people or whatever?
Good for Apple.
Different world, entirely. I think this also comes down to who you pay attention to in terms of advice. So advice has a shelf life. For example, I haven’t started a business in 20 years. Don’t ask me how to start one, because I don’t know. It wouldn’t be fair of me to say how to start a business. It’s been too long. I can tell you how to run one. I can tell you how to hire. I can tell you how to make products. I can tell you that stuff. But there’s this idolization of some of these people who started businesses a long time ago and they just want ... like, everyone new wants to be like those people. I think that’s kind of crazy too. Drives people insane.
Also, I think this obsession with lack of sleep and how it’s a badge of honor that like, “Hey, I only get six hours, I’ll sleep when I’m dead.” This is just stupid. Flat-out stupid. Literally actually diminishes your IQ and is bad news.
So I’m assuming food hacking is not your favorite thing.
Hacking anything is stupid.
Intermittent fasting. Are you intermittent fasting? There is interesting ...
I don’t do intermittent fasting, but I do ... let’s call it time-restricted eating. How’s that?
I don’t believe in hacking anything. There’s no such thing as a hack. That whole term is crazy to begin with. Everyone’s looking for shortcuts. There’s no shortcuts. There are no shortcuts. The thing is is that like doing well, you don’t have to go the long route anyway. If you make things hard on yourself then you have to look for shortcuts. If you just do the simple thing and don’t get carried away, everything’s kind of shortcutty in that sense.
That’s a fair point. Some of the food stuff is actually interesting. I do agree.
I do that. I do the time-restricted eating.
It’s the never-going-to-die stuff.
It’s the Soylent shit. Like, come on.
One of the people there, I was like, they were talking about living longer. I’m like, “Let me give you a pro tip: You’re gonna die.”
You’re gonna die and you want to die.
You can die healthy. That’s better than dying not healthy. So, before that.
Totally, I saw ... I don’t know if you’ve watched the George Bush eulogy, Bush eulogizing his father. I thought he said something really interesting.
I think he said, “My dad always said that you want to die young as late as possible,” and I thought that was a great line, actually. And that’s kind of a nice sweet way of thinking about it versus ...
How did George Bush Jr. become not an idiot?
Because he’s not president anymore.
I guess. I don’t know.
You kind of look back fondly on people.
Didn’t we dislike him and think he’s an idiot? Anyway.
It’s all relative.
I’m here with Jason Fried, the founder and CEO of Basecamp. He’s the coauthor of a new book called It Doesn’t Have to Be Crazy at Work. Some workplaces are crazy and they have to be crazy. They celebrate crazy in a lot of ways.
They don’t have to be, but they celebrate it.
Where does this come from? And the answer definitely should be VCs. Talk about your VC...
It’s a big part of it.
Here’s the problem I have with VCs, specifically around ...
Just one problem?
No, I’m saying one and then let’s get ...
Oh, up to 30.
So one of them is ...
The shoes. Go ahead.
The shoes. The problem I have is that a lot of people take money too early. That’s the main thing. I think VCs prey on that situation where people don’t have anything and they’re desperate so they go try to raise a bunch of money. The problem with raising money early on is that you get good at spending money, you don’t get good at making money. The things you do over and over and over, the things you practice are the things you get better at.
So if you have a bunch of money in the bank, you’re encouraged to spend it because no one ever ... Well, I shouldn’t say no one, but hardly anyone ever goes for one round. It’s round A, round B, it’s like, you’re going back to the drug dealer.
They feel like they have to, and especially when others are getting it. It preys on your insecurity.
But more so, they’re encouraged to spend it. It cannot sit. It has to be spent. And so what do you get good at? You get good at spending money. And when you get good spending money and you know there’s more to spend, you don’t think about costs. You don’t think about being smart about your money. You don’t think about what you’re really spending it on. You don’t really care if it’s wasted because there’s more of it. There’s an endless supply and it wasn’t yours in the beginning, in the first place, so who cares?
Right, free money.
So by the time you finally need to actually make money, you don’t have any skills. You don’t know how to make money because all you know how to do is spend it. It’s like if you were to go onstage for the first time and play guitar and be expected to play guitar, everybody in the world would go, “You’re not good. You’re not going to be good at playing guitar.” Everyone would know: the first time, you’re going to suck.
So these people start these businesses, they raise a bunch of money. They lose money for years and years and years, and then at some point they’re expected maybe to make money. We expect that by that time, since they’ve been in business for nine years, they’ll be good at it. No, they won’t, because they haven’t practiced, just like that guitarist for the first time.
So I think that VCs and raising a bunch of money and raising way more than you need, it ends up stunting people’s actual growth as businesses. It destroys businesses.
It’s like rich kids. Rich kids that’ve been overfed.
It’s like, look, you know, you plant a seed, it needs some water, but if you just pour a whole fucking bucket of water on it’s going to kill it. Like, you can’t. That’s too much money too fast, too early.
A lot of people resist that, though, because there is ... Right now, for example, SoftBank is throwing ... well, maybe not so much given it’s coming from Saudis. They’re throwing a lot of money, and I’ve talked to a lot of these startups and when they have a great business and it’s going well and they seem to be building it to some profitability ... A lot more startups lately, I’ve noticed they’re much more interested in making money. Like all the entrepreneurs I talk to versus anything else. It’s a really interesting shift.
Why do you think that’s happened?
It’s this idea of intentional growth. They don’t want ... they are tired of it. They’re like, “Just a second. I want to make something great and I want to make it on my time,” and they don’t want to be forced to sell or do something. There’s something going on. There’s definitely like a, “Just a second here.”
There’s a little bit.
It feels like it.
I’m not sure what’s happening, but I definitely have heard it more and more and I don’t think it’s just bullshit.
Are they doing it? That’s the question.
Yes. Several of them. Yeah. I have good examples of this idea of intentional growth is the kind of thing.
Well, I’m more curious about profit.
Right, but they’re interested in like, “I don’t want to make something unless it makes money.”
That’s the kind of ... and I haven’t heard it ...
“Takes home money” is the key. It’s a nuance here.
Yes, because the only thing ever discussed in this industry are revenues.
Right, no. They’re talking about profit.
Great, good for them.
Profitable, and not just cash-flow profitable. Real profitable.
Real profitable, yes.
Right. Exactly. And so it’s interesting. It’s an interesting trend. Anyway, I think what happens, though, when you ... Say you have SoftBank giving someone ... “We’re going to give you $3 million or your competitor.”
Go ahead. Our competitors are flush with billions.
I don’t care.
But it does play into human nature. Like, come on. It’s hard to resist something like that. It’s harder.
It depends. I mean, yeah, it is harder. It is harder. But so what? I mean, that’s make or break for your business. If you take that money, you’re not going to run the business you wish to run if you want it to grow intentionally, let’s say. All of a sudden you’re building a business, you’re a division of SoftBank and they’re gonna run your show. That’s basically, they want their return.
So, I think if you don’t think about the implications of taking that kind of money, you’re foolish. Now, you might decide that it’s worth the implication. It’s worth it, and you want to do that because you want to feed the ego, usually. It’s usually ego-based. You want to grow big, you want to have power. I totally get all that. That is a human thing, for sure, in all realms. You know, I’ve just never been interested in that.
I think that venture capital money kills more businesses than it helps. Lots of businesses could be great $10 million, $20 million businesses, but they’re not allowed to be. [They’ve] got to be $200 million or $500 million or a billion.
Right, and when you’re $100 million, they want you to have $2 billion.
Yes. And you can’t stop because you’ve already signed a deal and it’s just ... or like they’ll forget about you, whatever it is. You’ve got to go huge. And so few companies are huge. Just look at the math, do the numbers. There’s basically no huge companies. If you really look at all the companies, they’re outliers, extreme outliers. And I think hopefully more entrepreneurs are seeing that one of the reasons you get into entrepreneurship is to control your own destiny to some degree.
To not have to go work for somebody else, to not have to collect a paycheck from somebody else. And so the thing is, when you go take money, you’re working for someone else again, instantly. So I think people are beginning to realize that if you really wanna work for yourself, you need to stay independent. Independence is such a beautiful thing.
It’s harder to resist, but it’s not harder to do. For example, every business has competitors. Everyone, right? The market is so big. And I’m not gonna do this. If you get 1 percent of the ... I hate that thing, you know that one?
I’m not talking about that. For example, Basecamp. We have, I’ll round it, we have, I’ll round down, we have over 100,000 paying customers who pay us every month for Basecamp. Okay? To some people, if they took money, that wouldn’t be enough.
Right. You need millions.
We generate tens of millions of dollars in annual profits every year. Okay. Tens of millions in annual profits. So, more revenue than that. But for many, that wouldn’t be enough. If we would’ve taken $300 million, that’s ... don’t make profits to pour all of that back into the business and grow as fast as you can.
But the way I look at it is, we have a kind of business that we wanna run. We wanna run it our own way. We’re taking home lots of money every year. We’re paying our employees incredibly well. We pay them top 10 percent salaries in the industry, San Francisco rates, even though we’re not based in San Francisco. We have amazing benefits. We have all these things because we’re independent.
And we can do things that don’t make sense from an investor standpoint, they would say “It’s not worth it to spend 5,000 bucks per person to send them on vacation. It’s not worth ...” I don’t care. I don’t wanna have to answer to that. I wanna answer to myself, that’s why I got into business.
Right. So you think VCs create that mode of like, the go, go, go, go, go? Right?
Of course. Because look, they have to. They have to get big, huge returns from at least a few people per, a few ... one company per fund, or whatever it is. Which is so funny to me. These are supposed to be really brilliant financial people, yet their hit rate is 1 percent, 2 percent, 3 percent? And they admit it. “We’re gonna get one out of 100 right.” And you’re begging to work with these people?
I couldn’t agree more. I was just like, government employees get it right, you know what I mean? It was really interesting because there is this ... it’s interesting, though, what’s happening around VCs, the idea of ... especially because there’s also discrimination and how they fund and the decisions they make and how they pattern-match.
I was telling a story about someone who, one of them was like, “If there was only a Marcia Zuckerberg, we would fund more women.” And I’m like, “Can all women suck?” Let’s just go on the premise that these numbers ... and women suck that much more than men. And people of color suck that much more than women and men, white woman and men. I was like, “It can’t be.” Something’s wrong with your decision making that you don’t even, maybe you don’t even realize you’re doing it willfully or not willfully.
People tend to ...
Yeah. They pattern-match, but they also, they invest in who they know and that’s kinda how it is. It’s unfortunate.
I get it.
And luckily, there’s a new world.
But what’s another system? What’s the other system then?
Well, I think with ...
Just making ... someone that makes money.
Well, yeah. First of all, like every other business on the whole fucking planet.
Right, right, right. The guy down on ...
The guy down there at the grocery store ...
The falafel guy.
Yeah, the falafel guy, he’s not going up to his friends going, “I’m gonna sell a fucking million falafel, I’m gonna lose a buck on each one, but I’m gonna sell a million of them and become huge.” And that’s not how it works. He’s like, “I’ve got bills to pay. I’ve gotta support my family and my kids, I’ve gotta make more money than I spend.”
Basic fundamental economics, every business on the street, every business in the world, except for a handful of outliers primarily in the tech world, with some biotechs as well, there’s other businesses that are high-flying risk-taking businesses. But here’s the thing that blows my mind about Silicon Valley: Silicon Valley is taking the highest-margin product you could ever have — which is software — and turn it into the lowest-margin, negative-margin business model ever. You’re taking the most profitable thing ever ...
It doesn’t cost anything else ever, the next one.
... and you’re losing money. These companies are losing billions of dollars. What the fuck is going on? How is that possible?
I think Wall Street lets them. I mean, I had an interesting discussion today about someone who was talking about Amazon and we know, which everyone ... it’s the beloved company right now obviously, AWS, yeah.
Not for long.
Well, that’s what they were, they were like, very smart at first, smartest analysis I’ve heard and I was like, “Well I hadn’t thought of that.” And they’re absolutely like, “AWS will be commoditized and then they’re gonna have to pay for the delivery service. And then they can’t keep it. And no matter what you do, food is a zero, a low-low-margin business. And so, what are they gonna do to make money? They’re gonna have to charge higher prices.”
Well, as long as Wall Street enables that.
That’s right. So it doesn’t matter if Wall Street enables it. And one of the things that I was like, “You’re absolutely right, that’s exactly where it’s going,” until, one of the things that was interesting with Amazon is for years, Wall Street let them do it forever until they got to AWS, which was a good business.
Oh, it’s a great business. Yeah. Independently.
Right, but maybe not if you posit forward, you know what I mean? They were saying there used to be a lot more competitors.
There is, but there’s that kind of yes, I agree with that, except that that scale requires a huge company. So there’s basically, there’s Google, there’s Microsoft, and Amazon. There’s three of them.
That’s what they were saying. They were saying there’s gonna be price competition that’s gonna make it harder and harder to make quite as much money, unless they all ...
There is ... oh, they’ll probably, yeah.
It was just interesting because I do remember, there used to be ... do you remember, there was like a zillion storage companies?
Oh, for sure.
And then there weren’t.
And hosting companies, website hosting companies.
And hosting companies. And everyone said they would be forever ... this was something everybody needed and then it was like, not at all. The first time, I was like, “Ah, that’s an interesting analysis. What if that business went away?” We’d be back to ...
I mean, AWS and Azure and Google Webserve, whatever they’re called, I think I might be getting the names wrong, but anyway, they’re a different tier but there will be other cloud, and there are other cloud service providers where you don’t need that level of capacity. If you’re not the United States government, you don’t need to spin up 1,000 machines in a second, right?
So there’s some businesses that will be able to exist at a lower tier, which will provide more competitive prices, perhaps, but although AWS’s prices are quite good, they’re amazing prices, but just the services and the slice of the customer service. Because their customer service is terrible. A lot of these big companies, they don’t know how to provide customer service on the technology side. So you’ll need someone else who’ll cater to that and it’ll be different little small niches pop up.
But the thing is, with web hosting and storage, that was a real true commodity. What AWS has and Microsoft and Google have, they actually have technology that’s not the commodity yet.
It was just an interesting ... I was interested in someone who would actually go against the grain, against the normal ...
Yeah, I love that.
Which was great. So how do you build a better company? Do you think there’ll be a shift, that people will … or have Google, which pioneered the free crap...?
They were like the king of free crap.
Well, because they made money on advertising.
Although, actually, you paid for food there, I think, I’m pretty sure.
Yeah, they don’t give free food. Neither does Microsoft.
You pay for it.
Good. You should.
I was at Microsoft, I was like, “You have to pay for this?”
“Pay for this taco, what?”
And Apple, you have to pay for it. Which is interesting, I’m trying to think of ... they don’t give out free food.
They absolutely ... it’s beautiful.
It 99 cents, though, per app.
It’s cheap, but it’s ... it’s still paid for. It’s a different mentality.
It should be. It should be.
And there’s not a lot of free stuff around that company, which is interesting. Talk about what ... how does it change? How do you stop being ... how do you stop the infection of Silicon Valley? And keeping some of the good points.
Well, it’s killing itself. Like any virus, it kills itself. It kills the host. And the host is the economy, and the host is people’s trust. It’s killing itself, so I’m just gonna let it kill itself. It’s happening before our eyes.
I think what’s interesting is ...
Well, some of it is due to the ... it’s due to some products that aren’t working out, so ...
Well, there’s that too.
But. Yes, but trust, specifically, is being eroded very rapidly.
It is, 100 percent.
And the fact that these businesses are manipulative, that they build addictive products and they have extreme amounts of centralized power. That combination of power, manipulation, and addiction: Dangerous. And people are beginning to realize that.
Yes, 100 percent.
And actually, what’s kind of interesting is if you think about the cigarette business way back when ...
Addiction, power, and ...
Centralized control, yeah.
I think, yeah, I think, manipulation, I don’t know. I made them up, but manipulation, power, addiction, strong centralized control. Anyway. Think about the cigarette industry, which of course is a shadow of itself, at least in the United States, what people got pissed off about was that Philip Morris knew cigarettes were dangerous, but they didn’t tell anybody. They knew the signs, and they withheld it, right? That’s what people are really pissed about. It wasn’t that people chose to smoke and that these cigarettes were addictive, it’s that someone knew they were addictive and they didn’t tell you.
And then they used culture to get you to smoke, and movies and advertising.
But I think it was the secret — that they knew — that really pissed people off. And I think what’s very interesting is, if you look at social media right now, let’s talk Apple for example, which is not social media but the phone, right? Actually, both iOS and Android have a Screen Time-style component.
To me, in many ways, this is these companies recognizing how dangerous these behaviors are and saying, “We don’t wanna be Philip Morris. We know the shit’s bad. We wanna help you try to control this from the start so you don’t hold us responsible 20 years down the road,” when we realize that 150 dopamine hits a day to your brain has caused brain damage or has caused, who knows what it’s gonna cause in 30 years.
So it’s very interesting that they’re, I think, ahead of this curve. They’re pretty much ahead of this curve compared to the traditional addictive industries.
But to get back, that was an aside. To get back to your point, so first of all, you can bootstrap, or you can take a business, sort of a side business from that business, that’s what we did. We were a consulting company, built the software on the side, didn’t have any expectations for it, turned out it was doing better than our consulting business about a year and a half, two years later, so we ditched consulting and been doing software ever since. So we funded ourselves in that respect.
But there’s a new wave of ... I wouldn’t call it VCs because they’re not venture capitalists, so much, but they are people who can provide bootstrap funding, let’s call it. You’ve got Indie.vc, you’ve got Tiny Seed, you’ve got Earnest Capital, there’s a number of them. And they’re coming out and coming around to give people like 150 grand for six months or for a year. Basically saying, “You’re running a side business right now. If we could give you a full year’s salary, essentially, to dedicate yourself for a year, let’s see what you can do with that.” And then taking a small piece of the company. A few percent.
And that to me is interesting. That’s not the million, billion-valuation thing, that’s like, “Can you turn a bootstrap company into something?” As a funder, we would take — I’m not saying “we” but one of these people funding — would take dividends. So there’d be an LLC, for example, and we’ll take dividends. So if you have 150,000 bucks left over at the end of the year and we own 5 percent, we get 5 percent of that as a dividend. We’re gonna make our money back on dividends, not on the big huge mass. Maybe there’s gonna be one or two that turns out to be a big thing, but for the most part, we wanna help you grow your company, maintain control of your company, and we’ll take dividends as a form of repayment.
Which is in fact ... So, Jeff Bezos, we have no investors, Jeff Bezos did buy a piece of our company in 2006. He bought it from me and David. So none of his money ever went into our business, it went to me and David to put money in the bank. We’re an LLC. So people always ask us, “How does Jeff get his money back? You guys said you were never gonna sell your business, you don’t wanna acquire anyone, you don’t wanna be acquired, you don’t wanna go IPO, how is he gonna get out?” Well, he’s getting out every year because we’re very profitable and he gets a slice of that money every year, a nice slice of money every year, and he’s been in this 12 years now.
Why did he go into it?
To invest in us?
He just liked it. It’s just like him, I could see him.
He just liked what we were doing. We were doing something very different back then and he was into it.
Oh, I could see him. I can see him back then doing that, too. Yeah.
Yeah. I don’t know if he does that much anymore. He probably wants to make big huge bets now. But ... no?
I don’t think so.
That’s cool. I haven’t talked to him in a few years. So he makes money on the dividends and that’s a wonderful method of actually making money off of investing in companies, is making it slowly just like the company makes it slowly. And being invested along with the company: when they make money, you make money.
Right, you get a piece. Yeah, I get it.
That’s fair. I like that model. And there’s a number of them bubbling up right now, we’re actually gonna be supporting some of them. So we’re gonna put a little bit of money into a few different funds.
So that they become LLCs and then they’re distributed money. Just distributed profits.
And then some of it, you put back in the business, presumably.
It’s up to you. It’s all, LLC all the profit’s taxed at a personal level. So if you wanna throw some back in, of course you can do that.
Right, but you’re operating, you’re covering your costs, so it doesn’t really matter.
Right. Right. Right. Which is antithetical to Silicon Valley, which is, “Drive it back in and keep going.”
That’s the other thing I don’t understand, which is this idea that you just keep pouring it in, as if it might be there, as if it’s going to be there later. I am not a fan of deferred living. And that’s what that is. Basically, that’s let’s throw it all in and one day, we’ll be huge and we’ll sell it and we’ll get rich. But what if you don’t? Mostly, you will not.
So why not take a piece as you go? Every year.
Take a piece out as you go.
Oh, because people think it’s like gambling, they think they’re gonna miss the big hit, if they ... right?
“I didn’t get Google at this price,” it’s so ... gambling.
You know how it goes, totally.
Let me finish on one of the things you didn’t finish up on, the last thing that you talked about, when you were talking about this idea of cycle of addiction, one person in charge, you know, centralized thing, and the third one was ... I’m sorry, addiction ...
Manipulation, addiction, and control.
Where does that go? Because I agree with you, what’s really fascinating to me — I’ll use Facebook as an example — is, there’s centralized control, there’s addiction that they know about.
And they’ve done it and they have all these people getting to push that red button. And you’re being manipulated almost constantly. And they’re not acknowledging that either. And in fact, when you point it out or they have problems, they always move into the “we” mode: “Well, together we’ll solve it.” and I’m like, “Together, we didn’t make the billions. Together, I can’t fire you. Together, we ...” This is not a together thing. And that, to me, is the most irritating we-ness of it. And I’m like, “Where’s the we? What do you mean, we?” kinda thing.
It’s really weird. It’s really weird because I feel like there are these companies, not all of them, but let’s take Facebook, they’re easy to beat on right now.
Deserved. Absolutely deserved.
They’re very victim-y right now. Do you know they’re very victim-y right now?
They’re not equipped to handle this.
Oh my god.
Very what to you?
Victim-y. Like, “Oh, we’re really ...”
Oh, yeah, of course. Which is ridiculous.
I literally was like, “You’ve never been unsafe a day in your privileged ridiculous life.”
Right. Right. Clearly. Clearly.
It’s so funny, though. Victim-y like crazy.
Well, it’s kind of the defensive posture when you’re being picked on, you go there.
Even if you’re a bully, which they are, then you go there and you look for sympathy. That’s just a natural ... this is human behavior.
It comes from the top, 100 percent comes from the top.
Of course. Everything does there, of course. But I think they’re not really equipped to handle what they’re in.
Mm-hmm. Yeah, they’re incompetent to the task. Yeah.
Yeah. I don’t know if anyone can solve the problem, other than government.
I don’t think it’s a problem that companies can solve, I think this is a runaway train. This is society, this is humanity, this is just kind of where we’re at. And I think you have to look to what’s going on in Europe, perhaps, as a model for what might happen here at some point. Because I don’t see any other thing other than people striking en masse and saying, “We can’t handle this Instagram anymore because we can’t look at photos” ... that’s not gonna happen because people are addicted.
It’s addictive. So you’re not gonna stand up and say that, so it’s gonna have to be a bigger power than them. And the only bigger power is government.
Which is also incompetent to the task.
But they haven’t always been. They managed to step in, AT&T, they’ve managed to step into Microsoft, they have eventually managed the steps there.
Yeah, but they understood the telephone. I feel like, I’m not sure they understand what’s going on. But at some point ...
What makes you think that? Those hearings?
“Will you help me with my Facebook, Mr. Zuckerberg?” I was like, “What?”
“What?” That’s leadership, though.
I literally almost reached at the screen and was like, “I’m going to have to…”
There’s generational turnover, though. I mean, it’s gonna happen. It’s gonna happen and at some point, people are ... I also do think there’s gonna be fatigue. And there already is fatigue. But it’s not gonna be enough to turn the tide. But there is enough of it now where ...
For example, five years ago, everybody would give Facebook the benefit of the doubt. Maybe five, six, whatever, “Facebook’s great, Facebook’s great, Facebook ...” Now, nobody gives them the benefit. So things have turned and they’ll continue to turn and some people will leave and some people will make some noise but I think it’s government in the end. Unfortunately.
It’s interesting, though, that now everyone gives Microsoft the benefit of the doubt. Because they like what he’s done there.
Yeah. He has done a nice job.
He’s … talk about calming a company down.
Yes. It’s pure and it’s calm from the outside, although I don’t know if that’s true internally, they’ve had a long history of working insane hours. And they actually ran an ad campaign which we railed against a few years ago, where they promote that you can work — like they had this ad where it was someone who was working like in the stands watching their kid’s baseball game. It’s like, “You can answer emails while watching your kid’s baseball game.”
Oh well, yeah, they’re selling stuff.
What the fuck is that? Yeah but, that is so perverted and broken and wrong. You know? But anyway, I think they also have the benefit of the doubt because the focus and the attention is elsewhere right now. And they’ve kind of taken a fall and they missed out. And so now, they’re the darlings again, kind of like George W. Bush.
Right. That’s true.
My goodness. I’m not even gonna get into Uber right now.
But anyway, Jason, this was fantastic and I have you back, again, this was really fun. Thanks to you all for listening, his book is called It Doesn’t Have to Be Crazy at Work. I remember reading Rework, it was a fantastic book. It’s a really good book. And Basecamp is a really great product. You’re right, there’s a million of them in, actually.
You’ve been around.
You’ve been around the block.
Yeah. We’re still around.
Oldie but goodie kinda thing.
You’re really old, hey, 2000 ... 14 years.
Yeah, I mean, we have brand new versions every three years.
Yes, I know that.
But the thing is is that we wanna keep the good old days rolling.
That’s the thing. Everyone likes to look at these and they go, “I wish we were smaller again.” Or, “We’re just gonna keep it smaller then.”
Just keep it that way.
Jason, I like it, it was great talking to you and a breath of fresh air. Thanks for coming on the show.
This article originally appeared on Recode.net.