You'll know you're on the right track if other people are like, wow, this person is doing something really interesting and they want to talk about it.
That's a sign you're on the right track.
This is Dalton Plus Michael, and today we're going to talk about how startup founders get rich quick.
And we're going to try, I was going to say, we're going to try to keep a straight face.
We're going to try to keep straight faces.
So Dalton, what is the three-part recipe pleased with?
Yeah, I think the way I would set this up is there's the wide perception of something and then there's the reality.
And I think a lot of people in the world think of being a startup founder as sort of a get rich quick scheme where you kind of show up and you promise some fake stuff and you wave your hands.
And then somehow someone gives you a bunch of money.
It's like really easy and it happens really fast.
And I think the theme of a lot of the videos that we put out over the years is to sort of dispel those myths or at least be honest about how the sausage is made here.
And so the point of this video is let's talk about some case studies of people that did get rich quick and what they did and see if there's anything actual in there or not.
Or if it was all right place, right time, I wouldn't bet my life on it.
It's funny because I think in my career, I actually have both examples.
And it's really quite funny that it happened that way.
So there's Twitch, which took five years for us to even figure out what we needed to do.
And then another set of years to actually sell.
And there's social cam, which the public story is right.
Like we spun an address in TV and sold within six months, right?
So like, boom, boom, boom.
For me, I remember a story when I was first starting, when I was 23 years old, and we had our lawyer at Wilson Sincini who was 30.
And first I thought, that's impossibly old.
You were an ancient person.
And the lawyer said very calmly, hey, just so you understand, you know, we do with a lot of startups.
We've done kind of a bit of a study, and it turns out it takes about eight to 12 years to exit your company.
Something that when we say that to ourselves, we're like, oh, that lines up.
And I remember thinking this old 30-year-old has no idea.
There's no way this is gonna take eight to 12 years.
I've never spent eight to 12 years doing anything.
When you're young, college was four years.
And that's like, impossibly long.
And nobody does the same thing in college for four years.
So I just remember thinking, old people don't understand.
I will tell you, we sold the company eight years later.
And I was like, ah, turns out you were right.
And so I think that this idea
One is so verifiably untrue.
But two, to be honest, I think it's part of the reason why people get into it.
Like, how many people right now are in year one of their startup?
And they're like, if I really knew this was eight years, I'd quit today.
Have you ever heard that old engineering saying, we do this not because it's easy, but because we thought it would be?
And I think that startups, I think if I had to summarize everything about technology, the whole industry is people thinking something will be easy and then they get in and they keep going for some reason.
Well, because once you're in, I don't want to belittle this.
I want people to do startups.
So I'm not trying to convince everyone that startups are so hard to not withdoing.
But on the flip side, once you're doing a startup, I don't want you to lie to yourself.
I think that's the big challenge is when you lie to yourself, you then look for shortcuts, you look for hacks, you look for ways that you can get value and your customer doesn't because you would know logically that if this was a long-term plan, it wouldn't work.
But when you lie to yourself, I'm like, oh, I could do this for a couple of years, and then we'll sell.
If we make $10 million, we can sell really easily.
You could tell yourself this kind of fake story.
So how do you live with that duality?
A lot of founders have this hidden secret thought that they want to hide from everyone, especially investors, especially the parents in the room, which is they really just want to get rich quick and sell their company fast and cash out.
And they don't actually want to be in it for the long haul.
the idea of IPOing a company.
Yeah, the last thing on though.
And so they're like, man, I know I'm not supposed to admit this.
Otherwise he wouldn't give me millions of dollars.
Otherwise I wouldn't be able to raise money, you know.
And so this is my like, you know, maybe give me some drinks and I'll tell my friends.
And I think the perhaps surprising thing I would say is, oh, we know.
And so here's the point, is it's actually extremely mid-wit to think that this is a secret and that your job is to pretend that you want to build a big company and like you'll fool everyone and somehow it'll work out.
Mid-wit's the exact right term because you're better off being dumb and just assuming building a big company is easy.
Like you're actually better off.
and being like, no, I found the hat.
Yeah, I feel like, oh, I got into YC and I told them I was in a big company, but I'm not.
Like, if you think that that's some like cutting edge strategy that you invented, I've got news for you.
You should just accept that and then flip this around and be the actually if you really genuinely like if you could read my mind and you're like, Dalton, how would I get rich quick with a startup?
It's to do the opposite of what everyone else is doing.
And if everyone else is trying to like fake their way through things and not build real value or.
being it for the long haul, if you build real value, you stand out from the crowd and counterintuitively, those are the people who make a lot of money really fast.
Do you get what I'm saying?
Well, I think what's so funny is that AI helps and hurts.
I think that if you're actually trying to create real value, AI makes it so you could do it faster.
And that's really exciting.
If you're not trying to create real value, AI makes it so you could do it really much faster.
And so I think that I have certainly seen conversations where companies would want to acquire a founder in the first year because that founder did something extremely interesting.
And I promise you that those conversations are rarely about companies that went from zero to 100 million ARR in three weeks.
If you're just building cookie cutter, slop, B2B agent stuff, and your plan is to get rich quick, I'm just saying, there is no market for that startup.
But if you do something truly weird or different that requires you putting yourself out there and really trying, it's actually possible for you to get rich quick.
And with the provisor that you're not.
raising tons of money and burning tons of money because these are not, these deals we're talking about are not billion dollar deals.
These are, you know, AccuHire pluses.
I mean, to give you a couple of examples, there was a company that I was in the interview, we accept as to YC in like 2020.
And the founder was building like a niche social network, you know, that didn't go anywhere.
And he pivoted to this thing called Bunn, which was a
JavaScript runtime compiler thing.
And he would post about it constantly.
And it was like really interesting.
Like he was an interesting guy doing interesting things.
And then anthropic bot fun for a decent amount of money.
I don't know if that was quick like four years, but basically I think he got extremely rich.
And he did the dream that I think a lot of founders secretly want, which is to get anthropic to buy their company for 40 million or whatever in anthropic shares.
It wasn't by like brainstorming on how to fool people.
Spamming infinite people with email.
It's that he built a really kick ass
JavaScript tool that earned the respect of other builders.
Like if you wanted to replicate getting acquired by Anthropic in three or four years, do that.
I mean, I keep on bringing this point up in every video.
You can actually just look at every public Anthropic acquisition and ask yourself the question, what did they do?
And was it a lot of networking?
Like, what is your secret strategy to get acquired?
Does that look like the stuff that anthropics mean acquired?
Like, what's so funny is we're basically saying there's alpha in just looking at the facts because so many people are deluded.
And that delusional story is so attractive.
They don't want to look at the facts.
They don't want to learn the truth.
And so you can stick out even more.
It's a weird thing that you can stick out even more just creating value right now.
And like think about like Open Claw.
It's like some guy in Europe who was like an indie hacker for 10 years and he just built this cool open source company and then, you know, got bought for a ton of money.
I guess he got, he got rich quick.
But like, you know, he was not trying to get acquired.
He was just building really interesting stuff.
One of the ways you can avoid this trap is to actually build something you like, build something you want to use, or build for people and customers that you like.
It's so easy to get into the, I want to try to figure out how to pick an idea that VCs will fund even though I hate it, but that's okay because I'll do this fast flip thing that doesn't ever happen.
And you're just kind of like,
You're tricking yourself here.
It's like it's way easier to enjoy the thing you're doing.
And the investors know, again, this is our point, is you're not fooling anyone.
You're actually just fooling yourself if that's your secret plan.
Like, who are you fooling?
We have factored that in.
And oftentimes what's fun, and I'll bring it back to Twitch.
which pivoted into the thing that Emmett actually liked.
Like, even if you're running your company now, you can just pivot into the thing that you enjoy doing.
And counter-intuitively, you might have massively increased your chances of getting rich.
It's like, it's sitting right there.
And how many jobs are like that?
How many jobs was like, you know, if I came into work and just did what I wanted to do?
What if I ignored all authority figures?
And I just built something awesome.
With that being said, getting rich quick happens.
But damn, it's so much easier when you're doing something that you like and that actually is good.
And it earns the respect of other builders.
Like basically, you'll know you're on the right track.
if other people are like, wow, this person is doing something really interesting and they wanna talk about it.
That's a sign you're on the right track.
All right, thanks Michael.