Thousands of new products launch each year, but very few make it. Ryan Hoover has seen thousands of products launched over the course of his time running Product Hunt, and through his investing, and in this episode you’ll hear what Ryan has learned about launching products, growing products, and raising capital. Plus, we play a made up game called “What would you rather upvote?” Join us.
Thank you to our wonderful sponsors for making this episode possible:
• RevenueCat: https://www.revenuecat.com/
• Flatfile: https://www.flatfile.com/lenny
• Lenny’s Giveaway Bonanza: https://lennyspodcast.com/bonanza
Where to find Ryan Hoover:
• Twitter: https://twitter.com/rrhoover
• LinkedIn: https://www.linkedin.com/in/ryanrhoover/
• Website: https://www.ryanhoover.me/
Where to find Lenny:
• Newsletter: https://www.lennysnewsletter.com
• Twitter: https://twitter.com/lennysan
• LinkedIn: https://www.linkedin.com/in/lennyrachitsky/
In this episode, we cover:
[03:23] On being a tech celebrity
[09:02] Using Twitter DM’s as a content machine
[11:15] The questions most founders ask
[14:48] When should you start a company?
[18:28] Would Ryan raise money for Product Hunt if he could do it again?
[21:48] When should companies launch products?
[24:52] What makes a launch successful versus not?
[26:27] How to get to the top of Product Hunt
[30:01] What skill is most helpful for moving into investing and venture capital?
[31:39] What Ryan would do differently if he could re-build Product Hunt
[38:57] What matters most in life
[43:13] Which ideas Ryan would upvote
[48:05] What founders of consumer companies do to succeed
[55:33] Deciding to serve a niche or broad market
[58:03] The surprising parts of angel investing
[1:02:12] Advice for folks wanting to get into angel investing
[00:00:00] Ryan: I don't know how to articulate that- that feeling, but that flutter in your stomach that you wake up with in the morning of just anxiety and stress and- and worry. Um, being a CEO or founder makes it slightly harder, uh, in some ways, because you still have to put on this mask. You have to put on this space of confidence externally and- and internally as well, where people need to trust you. You also don't want to subject them to the same anxiety that you're feeling and be a 100% transparent.
[00:00:28] Lenny: Ryan Hoover is the founder of Product Hunt, which you already know. He's also former product manager, which I did not know. Currently, he's a full-time investor with his fund, the Weekend Fund. He's also an author of a bunch of great block posts and an actual book, called Hooked. He's also really good on Twitter and in my opinion, a very special human being. Ryan Hoover, welcome to the podcast.
[00:00:52] Ryan: Hey, Lenny. Thanks for having me. I've been reading a lot of your blog posts over, I don't know, past two or three years now, and I'm glad to- to see you do the podcast now. It's cool.
[00:01:01] Lenny: Thank you, man. That compliment will go straight to my heart. And I will think about it often. I appreciate that.
[00:01:07] Ryan: Cut- cut that and put it on Twitter. There you go. Yeah. [laughs]
[00:01:09] Lenny: [That's the clip, we're done. [laughs]
[00:01:10] Ryan: Yeah. Done, over. [laughs]
[00:01:14] Lenny: [laughs] This episode's brought to you by RevenueCat. RevenueCat makes it easy to build, analyze, and grow in-app subscriptions on iOS, Android, and the web. Their platform lets you focus on growth rather than getting bogged down in subscription infrastructure. RevenueCat provides a backend and wrapper around Apple StoreKit and Google Play billing to handle the implementation and upkeep of in app purchases. RevenueCat is your source of truth for customer status across platforms and provides out of the box analytics for key subscription metrics like monthly recurring revenue, lifetime value, retention, and more. With RevenueCat, you also get pre-built integrations with best-in-class tools like Amplitude, AppsFlyer and Firebase. That means reliable, consistent data synced to your entire product and growth stack in minutes. UA companies like Notion, VSCO, and Life360 use RevenueCat to power in-app subscriptions. Learn more at revenuecat.com.
[00:02:12] Hey Ashley, head of marketing and Flatfile, how many B2B SaaS companies would you estimate need to import CSB files from their customers?
[00:02:22] Ashley: At least 40%.
[00:02:23] Lenny: And how many of them screw that up? And what happens when they do?
[00:02:26] Ashley: Well, based on our data, about a third of people will consider switching to another company after just one bad experience during onboarding. So, if your CMC importer doesn't work right, which is super common, considering customer files are chock-full of unexpected data and formatting, they'll leave.
[00:02:43] Lenny: I am 0% surprised to hear that. I've consistently seen that improving onboarding is one of the highest leverage opportunities for both sign-up conversion and increasing longterm retention. Getting people to your aha moment more quickly and reliably is so incredibly important.
[00:03:01] Ashley: Totally. It's incredible to see how our customers like Square, Spotify, and ZORA are able to grow their businesses on top of Flatfile. It's because flawless data onboarding acts like a catalyst to get them and their customers where they need to go faster.
[00:03:17] Lenny: If you'd like to learn more or get started, check out Flatfile at flatfile.com/lenny.
[00:03:23] Lenny: You're such a tech celebrity; everybody knows Product Hunt. Everybody knows Ryan Hoover, at least in tech. And I'm curious, how often are you recognized walking around the street, in life, and has there ever been like a super awkward or super hilarious moment of that?
[00:03:37] Ryan: Yeah, so t- Product Hunt started in late 2013 and quickly got a lot of traction in- in the tech- tech sphere. So, yeah, people in tech, um, might recognize me. People outside of tech, doubt- doubt they recognized me. Um, I actually do wonder subconsciously if I grew my hair out to avoid being recognized.
Um, I'm not sure if it's true or not, but anyway, it's been a couple years or so growing my hair out and I'm like, ah, I just kinda wanna like disappear sometimes. But, you know, in San Francisco, where everybody's in tech, um, there was a lot of that. And probably the- the, the moment where I was like, "Oh, this is- this is like a thing," uh, it was probably early Product Hunt, uh, I was at- do you remember... I don't know if you know this. Do you know a club, um, called DNA Lounge, and they did something-
[00:04:19] Lenny: Mm-hmm.
[00:04:20] Ryan: ... Called Bootie every Saturday-
[00:04:20] Lenny: Mm-hmm.
[00:04:21] Ryan: ... It was like a mash-up dance party.
[00:04:22] Lenny: Yeah.
[00:04:23] Ryan: Yeah. Super well known in the Bay Area. Really fun, fun, uh, kind of experience. Anyway, I remember being with friends and drinking, like- like one does and somebody turns around and says, “Is that the Product Hunt guy?”
[00:04:33] Lenny: [laughs]
[00:04:33] Ryan: And that was the first time that sort of happened in that setting where I was like, oh gosh, now I have to like, think about my actions. And I can't just like, be entirely like loose and, you know, relax with my friends. And, um, so anyway, there- there's always pros and cons to those types of things. Um, but you know, it- it definitely is makes me more aware of, I'm already a very, like sometimes anxious and like self-aware person in terms of like my surroundings.
And so when you combine that with, “Oh, these strangers might be watching me,” is not the best thing in the world, but it's okay.
[00:05:04] Lenny: I've actually gone a little bit through that same experience recently in my, like a much smaller sense where I- with this newsletter and the growth of this thing, there’s been like meetups happening all over the world. And so I've been going to the SF meetups here and there, and it feels very strange to be like, known and people get- they’re like taken pictures with me, like what the- what the hell's going on.
‘Cause I started this thing as, uh, COVID hit and it was like- everyone's at home, I was just typing on my computer, didn’t have to go anywhere. And as the world has emerged, it's become a new- a new thing I'm dealing with, on a much smaller scale.
[00:05:35] Ryan: Yeah. Yeah. Events are events are fun. Um, we threw a bunch of them at- at Product Hunt. Uh, yeah, you- you do a lot of selfies and a lot of like, handshakes and it’s- there's, there's some energy there. I'm an introvert though. So by hour, like three or four, I'm just like, ugh… uh… I need to use the restroom cause I haven't been able to escape and I'm socially exhausted, so, but they are fun.
[00:05:55] Lenny: I know, uh, exactly what you mean. I am also an introvert and I get so drained doing things like that. I was gonna ask you about that. So yeah. Um, along the same lines, you’re- you're a very public person. You tweet a lot, you share a lot, you do a lot of podcasts and things like that. What's something that people don't know about you?
[00:06:12] Ryan: Yeah. Um, you're right. I- I probably sh- maybe overshare, uh, on Twitter and other things…
[00:06:17] Lenny: No, that, that is not what-
[00:06:18] Ryan: Um, there is a list of [laughs] no, no, I know. I know what you're saying. Um, but there's also a whole series of things that I don't talk about. Um, some of them- well, anyway, I won't, I won't talk about the things I can't talk about.
Uh, but one thing that, um, one thing that most people don't know about- I know there- there's certain juicy things, uh, like everybody has in their life. Um, I recently moved to- well, I guess it's been a year. Um, I moved to Miami about a year ago and, uh, I haven't been talking about it publicly, primarily because I just didn't want to be lumped into, oh, another person moving to Miami.
Like, I, I don't know. I just, there's no benefit or like, reason for me to do so. Uh, I want my friends there in Miami to know I'm there, but otherwise I don't need the world to know. I guess now they will. Um, that said in Miami, you know, we’re- we're there about two thirds of the year, so I'm actually in California right now.
Um, as you know, the summer humidity come- comes through Miami and hurricane season. We’re- we're planning to do more of, um- I wouldn't call it nomadic and I wouldn't call it bicoastal per se, but something like that. Where two thirds of the year we’re Miami and then maybe a third were in New York, or LA, or someplace else.
Um, and I love that. Um, fortunately we have the flexibility, uh, when I say we, my girlfriend, Susie, and I, to just carry our laptops and work anywhere. So it's been- it's been a nice lifestyle kinda shift.
[00:07:33] Lenny: I did not know that, that is very interesting. Why did you get pulled into Miami? What pulls you there?
[00:07:39] Ryan: Yeah. You know? Um, so the way I describe ci- cities are kinda like a product. So if you're in the supermarket or- supermarket, I sound like an, old- old person. Ha, if- if you're at a store, you're looking at different products, or if you're online, you're evaluating different products, and they each have like a cost and they have some benefits, um, or values or whatever you- you want to use to describe it.
And for me, each city is kind of like that. And so, you know, in terms of costs, there's cost of living in terms of housing, uh, food, taxes, a bunch of things that go into the cost of living in the city. And then the city provides a lot of benefits and- and things like that. And so in LA- so I was in bay area for ten years, LA for two Miami for one.
Now, they each have their own pros and cons. They each cost effectively different prices. And so we visited Miami a year and a half ago and we just fell in love with lot- lots of it. Um, we also- it's just cheaper. It's cheaper than the Bay Area. It's cheaper than LA. Um, when- when you kind of count, kinda like all in costs, um, and we had a bunch of friends move there, so we enjoyed the city.
We're like, this is good., strong ROI. Uh, this is a good product. Let’s- let's move there. Um, but at the same time, as I mentioned, like- we are traveling and, and exploring other cities. So it’s- it's kind of the best of both worlds for us.
[00:08:53] Lenny: Very cool. Um, curious how long you last there and how you like it over time. I love Miami. I always have a good time when I go there. And I have many friends living there. Changing topics, a little bit, something that I've noticed you do recently, which is super cool is you offer people the chance to DM you questions that they have about their startup or their journey as a founder.
And you just offer to give 'em free advice. And then sometimes you, tweet the DMs to share that with more folks. I'm curious just how many people have DM’d you because this is such a cool offer, and what have you learned going through this and kind of hearing people's questions?
[00:09:26] Ryan: I first opened up my DMs- I had 'em closed, which is like traditionally the default on Twitter for a long time. ‘Cause I was like, “Oh, if I open them up, I'll just get a bunch of spam and I don't need another inbox to- to call through.” I opened it up quietly and, um, actually didn't get a lot of spam, uh, surprisingly. Like yeah, people would shill something or promote something, but it wasn't too bad.
So I- I left it open and then I forget, one day I was maybe I was like- on the elliptical, bike or the recumbent bike or something. And I was just… I- I tend to get on the bike and just hold my phone up and just do emails and work. And so, um, I just said, “Hey, DM me if you have any questions, any founders, and I'll try and like answer as many as I can.”
And, um, part of my motivation for that was… I don't know, I was just killing time. And the other was, I used to blog a lot. I used to write a lot, um, I don't know, I've written hundreds of blog posts, but not so much anymore. I rarely write anymore. And part of it's because it just takes so long to write.
And sometimes I don't feel like inspired by any topic. It’s- it's sort of like a writer's block. And so I found this also kind of as a means to like, do micro- almost like micro blog posts in a way, uh, where the prompt is the question from somebody else. I don't have to think about the pr- prompt. And then the answer is- is in some ways, a way for me to actually think about that- that topic, almost like refine my own thinking in, in some sense.
And so I started doing that and then I realized, “Well, maybe other people have similar questions, and maybe other people have other answers and other ideas too,” so I would just take a screenshot of my answer and kind of summarize their answer, of course, keeping it anonymous, not sharing anything that would be sensitive. Um, and just put it on Twitter and- you know, it's been fun.
I do that maybe once every three or four days, I share a new question and answer and, sort of like a… It's like micro blogging in a way, I guess that’s what Twitter is, but like it's a kind of like a real micro-blogging kind of like, uh, um, activity for me.
[00:11:15] Lenny: Is there anything that's kind of surprised you, or that you've learned from founders? What they ask you about? Like, “Wow, I didn't expect this was gonna be such a common problem or question.”
[00:11:24] Ryan: I wouldn't say anything like super surprising. However, a lot of people… So, you could do the same thing on Twitter and say, “Hey, AMA, ask me anything in public,” the thing is people are not gonna ask certain things, um, for a lot of reasons. And maybe the biggest surprise was a lot of people are pretty vulnerable.
These are strangers, founders who DM me saying, “Hey, I’m- we have three months runway left. We’re running out of money. Here's a situation. What advice do you have?” Or just things that, you know, everyone has to wear this unfortunate mask is kind of the way I- what I used to describe it. This mask in life, in business, where everything is going great.
And you know, you're super confident, there are no problems. You got it all under control. And so the reality is that's not the case. Like [laughs] if you peered inside of almost every single company, it probably looks chaotic in- in different ways. And so I guess- I guess maybe the biggest surprise or thing that I value the most is the authenticity of people willing to share some of these, um, vulnerable moments and questions.
[00:12:17] Lenny: Awesome. What's interesting about your format is as you were talking, I kind of realized it's very similar to my newsletter format, which I- which I think is part of the reason it worked is it's based on people asking me a question, and then I answer the question, and then-
[00:12:28] Ryan: It's true.
[00:12:29] Lenny: … And that ends up forcing you to have like concrete, actionable advice.
So you've kind of developed even more interesting way of doing it on Twitter, where it's more focused. So, very smart.
[00:12:39] Ryan: I've always liked your format by the way, in that you are, um- you're a curator in many sense. Like- yeah, you have a lot of experience and good ideas, but you're not trying to answer all the questions in that you are really pulling in experts in their domain expertise to like find answers or inspiration.
And I've always liked that format because one; it, I think leads to a better- better results, better content, better answers, but also it's arguably easier. Um, like imagine if- if you tried to like write, well, you you're shaking your head almost like it’s-
[00:13:10] Lenny: Like if I had the answers, I'd be like, “Oh, here you go. I'm done.” You know, the research takes a lot of work and time, but- but I do agree. It ends up being a lot more useful and, and- and valuable. And the reason I did that, just to kind of explain that briefly, is when I left Airbnb, people kept coming to me and asking me like, “Hey, how did Airbnb do this thing?
How'd they do that thing.” And I was just like- like, they, they don't know what they're doing. They just did this thing, and who knows if that was the thing that helped them, or if that was the right way of approaching it. So I wanted to do this, like, “What does everyone do? And what seems to be the pattern of the things that work?” And that kind of led to this approach.
And it takes a lot of time. Especially this new series that we're gonna chat a bit about that I worked on where it's just like endless interviews and chats and researchers and watching interviews. But yeah, it works out.
[00:13:54] Ryan: Yeah, yeah. You- you, how many hours actually, do you put into like a typical essay?
[00:13:59] Lenny: Oh, a reverse question. Uh, I would say the-
[00:14:02] Ryan: Yeah, I don’t know if I'm supposed to ask you questions, [laughs] but I'm curious.
[00:14:04] Lenny: This is banned. [laughs] No, it's cool. I say- I'd say the, uh, median post is about 10 hours. It's like, maybe I kind of work on it through the week. So maybe, like a few days through the week, but the most epic posts take hundreds and hundreds of hours that I kind of work on behind the scenes as I work on the weekly posts.
So there's a wide range. Some posts take like three hours and sometimes those do very well, much better than expected.
[00:14:30] Ryan: Yeah. Yeah. I- that's exactly going back to my, my point about like- it takes a long time to write content that you're proud of. Um, I’m also just very particular about words, uh, for better or worse. And so I- the first draft actually is maybe like 20 or 30% of the time. And then the rest is refining it and getting feedback and everything else.
[00:14:48] Lenny: That's exactly how I find it. The question I wanted to ask is, startups are so freaking hard… they almost always fail. It's always just like, “Oh my God, this is… Why am I doing this to myself?? My general advice to founders is like, don't start a company, unless you just like, can't not start a company because it's so hard.
What's your take there? What do you think? What do you advise founders for when they're thinking about, should I start a company? Should I not start a company? Which- how should I approach this?
[00:15:15] Ryan: I do- I do spend time, ironically, like. challenging founders sometimes when they're thinking about raising or thinking about an idea to- to not raise. Um, people who are in tech, uh, especially, are certain bubbles [laughs] of tech, that’s the default. It's like, “The first thing I do, I have an idea, now let's go raise money.”
And we've gone through some like pretty massive bull cycles where that- that was possible for a lot of people. But it's a huge decision. So with- with Product Hunt, it was a side project in the beginning. It wasn't actually intended to be a startup at all, but in the beginning, you know, it was a newsletter, then it was a website and it was about four to five months before we even incorporated.And we got a lot of traction.
So, it was during that time, I was really just thoughtful around, "Should we raise? Do I wanna work on this for many, many years? What's the opportunity? Is this even a venture backable like idea?" Like all those questions were circulating in my mind for a while. And this is also in a time when the market was pretty, was similarly bullish. This is, uh, end of 2013, early 2014. And investors were- were using Product Hunt to reach out to me, and they were sort courting- courting me, and um, kinda doing that whole song and dance to invest, but I- I just wasn't sure if I wanted to. And so, I don't know, I think a lot of the- those decisions, they're very personal and contextual. However, I think it's super important that founders see a line of sight to work on this for ... I think my rule of thumb is a decade, just do you see yourself working on this for a decade?
And maybe it's not a decade that you actually work on it. It probably won’t, it either, it'll probably fail before then as most startups do, but I think it's a good litmus test for yourself to be like, “Do I actually care about this enough? Am I, am I really stoked to work on this for many, many years?” But then, you know, the other thing is, I think a lot of people also think “I need to start a company. I need to start a startup.”
And they skip to that step without just tinkering and building and, you know, Product Hunt, we called it, not even a side project, we called it an experiment. And that framing I think, is for me, has always been helpful because it's an experiment is really not about success. Of course you want it to be successful, but the goal is not success.
I put that in quotes, it's really to learn and, you know, see if people want this thing and then kind of adapt. And so like an experimental mindset is helpful and I think a valuable way to start. It even goes back to like, why I named the fund Weekend Fund. It's like, what are you tinkering with on the weekends?
You know? And how can you be more curious and experimental and kind of your exploration of new startup ideas?
[00:17:43] Lenny: I didn't know that's why it was called the Weekend Fund. I thought it's because you worked on it on the weekends, or is it both?
[00:17:48] Ryan: [laughs] It had like multiple meetings. Yeah, it was- three meanings: One was- was that I started Weekend Fund when I was building Product Hunt. So it took a lot of pitch- pitches and calls with founders on the weekends. Two, I think a lot of great ideas start by like metaphorically speaking, nights and weekends, um, kind of side projects or ideation.
And then the third reason was it was like more friendly. I don't know, I didn't wanna name it. Hoover capital or something like sterile, wanted it to be -
[00:18:14] Lenny: Wait, that's an awesome name. Hoover capital. Wow.
[00:18:18] Ryan: …Capital. Uh I don't know. I, I feel well.
[00:18:23] Lenny: Yeah, it's not on brand,
[00:18:24] Ryan: Yeah.
[00:18:25] Lenny: But it’s powerful-
[00:18:25] Ryan: Um, yeah. [laughs]
[00:18:28] Lenny: As you know, I asked people on Twitter what questions they would want to ask you. And so I'm gonna inter splice these questions as we go through this. And, you just touched on Product Hunt and fundraising, and I'm curious if you were to go back and- and do it again.
Would you raise money for Product Hunt, or would you not?
[00:18:44] Ryan: Great question. So at the time, this is also the thing I ask [laughs] founders is why do you need to raise money? Like, what is it for? Surprisingly, some people like- I don't know, like they don't have a clear answer. For me, It was pretty obvious. Like we needed- we needed to hire, we needed people. Like, I- I didn't have personal capital to- to pay people.
There was an alternative, uh, reality where we actually built an open source. I was thinking like, “Is that possible?” Like we're building something for the tech community. I'm sure a lot of people would love to work on this. Could we build it in an open source way, but that like- that's really hard to do.
And when you're building a company, you probably don't want to innovate on too many things, um, including like essentially how to build a product and build a team. Anyway, to answer your question, if I- I don't, I don't know what the right at the time raising money was the right decision because I- I wanted to hire and I didn't have personal capital.
There really weren't any other realistic options. I don't think. Today I could get further with my own- I'm not super wealthy and I'm super illiquid, but I have at least enough money where I could have funded, you know, maybe a year of development with this very small team. So today it might be a little bit different in which I might not raise venture capital because Product Hunt isn't the type of company that needs to raise a ton of money.
It's also one which is not, um, doesn't have like direct competitors in the sense of like an Uber and Lyft situation where raising is actually like kind of mandatory and you sort of have to build a massive war chest to compete. So there- there is a scenario where if I had more money, then maybe I wouldn't have raised venture capital. But yeah… there- there's a lot of other like decisions and other things that probably, uh, bigger mistakes I think I made. Um, not that raising money was a mistake by any means. It was, I think the right decision then, but yeah- there's a lot of learnings in hindsight's 2020.
[00:20:31] Lenny: The point you made about like, you just needed money to like run the thing. I think that's so, so overlooked when people bash the idea of fundraising for a startup that maybe didn't need it. Like you just need money. Like you don't have just money to burn and go into debt. That makes sense to raise some money and see where this thing goes without really knowing where it's gonna go.
[00:20:49] Ryan: Mm-hmm .Yeah, especially if it’s… I mean, I think it's very important to raise- raise from people who are aligned with you too. Meaning like, “Why does this person want to, whether it's an angel or a fund, invest in your fund?” Um, sorry, not fund… your company. When you go down a certain path, when you raise a series A, B, C, like you have different expectations and when you raise your proceed or seed round. So I think also understanding like, you know, what you're signing up for is super important.
[00:21:16] Lenny: What kind of treadmill you’re- you're getting on.
[00:21:18] Ryan: Yes. Yeah. ‘Cause you can't get off. I mean you can, but it's not like a company… I always say like when you're at a company, you can put in two weeks, notice one month notice. You can move on. As- as a founder or CEO, you can’t. Like, you really can't. Um, now you technically can… But you can’t, it- it's really, hard, um, to, to exit.
[00:21:38] Lenny: Yeah. I look at the Airbnb founders. Who've been doing this for 15 years. Like, you know, they're doing well in life, but they also… it's very hard to leave.
[00:21:46] Ryan: Mm-hmm.
[00:21:38] Lenny: Yeah. Coming back to Product Hunt, people launch their product on Product Hunt, that's the thing, and I'm curious; founders are always so obsessed with launching and the power of a launch, and "We gotta launch.” Do you think launches are worth it for a company? Is that something founders should be spending time on or is it often better just to not even spend time on that and just build slowly?
[00:22:07] Ryan: Yeah, I- I always kinda ... Whenever I share like my perspective on stuff, I- I always enforce it always like it kinda depends, which is kinda like it sounds like a cop-out answer. So, it's- it's more ... My answers are usually more nuanced, and the thing about launching is- is going back to why are you raising money. What's the goal? Same thing. Why are you launching? And the the- a lot of people default to things like customer acquisition, "Oh, I wanna acquire customers." But sometimes that's actually not- it's not useful. Launch sometimes doesn't help with that, but there are many other reasons why you might wanna launch.
So, customer acquisition one, to get the word out. Another can be recruiting. So, by, you know, sharing your story, getting people excited, it might make it easier to recruit and get people excited about, you know, what you're building. Another is fundraising. Sometimes it can create momentum, you know, as- as other investors, they do read the news and they know that, you know, when this company is more public, they're might be more heat around it- a particular deal. Feedback is one. Um, the feedback from users, feedback just serendipitously and- and sort of another one is partnership. So, as you launch, you might also encounter more partnerships, more opportunities. I think there's a serendipitous effect of launching. So, I think understanding like what are the priorities of the business. Like if you- it might not be customer acquisition at all, it might be, "We need to recruit and hire. Let's launch, so we can get the word out. Hopefully that will help land, you know, our next, you know, engineers, designers, or whoever."
And then I also see there's like these little ti- side benefits too of launching that we see a lot through Product Hunt. One of them is team morale. And this- this might- I think this is overlooked. And I- I would also encourage [laughs] founders not to get their team too, um, I would say- you- you shouldn't be motivated to launch a product just to get like the likes on Twitter and the upvotes on Product Hunt, but there is a gr- like a powerful team morale and kinda building moment there where you can all celebrate what you've accomplished and what you built and put it out to the world. And, you know, somebody on the team can share, you know, the- the- the Product Hunt launch or, you know, some Tech Crunch article with their- their mom. And, you know, like that seems like a trivial kind of meaningless thing, but it actually matters for a lot of people. And then the other thing is SEO. So, if SEO's like a part of your strategy, having articles, positive articles, having a- a positive Product Hunt launch, things like that can also be helpful.
[00:24:21] Lenny: That's awesome. I love that last point about morale. I- I hadn't thought about that. You've seen probably more launches than other person out there. How many launches of startups would you estimate you've kind of like seen or been [laughs], I don't know, an observer of? If that makes any sense.
[00:24:38] Ryan: Um, I should look at our database on Product Hunt and see how many launches we've had 'cause it's gonna be a subset of that. I mean by seen, I- I- some of it's very high-level, but tens of thousands over the years.
[00:24:48] Lenny: Okay, so when you think about that, do you have any sense of what correlates with a great launch versus just like an okay launch? What- what do founders miss with how they launch?
[00:25:01] Ryan: Yeah, I mean the- this goes back to college and- and the a- you know, I won't go on my own rant about education, but in, uh, you know, English class and writing class, a lot of teachers teach people to write with big words and fill pages of content and basically not speak like a human. And so, one- one thing I've noticed among founders and just people in general is they tend to write like a- a PR person and not like a human and not like, you know, the- the way that I kind of describe kind of a frame of- of writing, maybe your tagline for Product Hunt, um, or for your launch in general is like how- how do your customers or your users describe your product to other people? Or another frame is how do you describe it to your friends? Like when you're just, you know, hanging out, like how do you describe what you do, what you built, what it's for? And that language, I think, resonates with people because it feels way more authentic.
And the people that use buzzwords and- and vague language, it just doesn't click. People see right- people are sick of the PR [laughs] speech. And so, I think the language and the microcopy, copyrighting matters so much. And then there's a lot of other things around like we should go more to the product and less about the launch. Like do you really understand who you're building for? And do you understand how to communicate the value prop- like what is it in the mind of user? There's sort of a lot of, I guess, more strategic kinda like decisions that go into that- that, uh, before the launch.
[00:26:22] Lenny: Imagine each of those, uh, points can be its own podcast and block post. [laughs] One of the questions that people asked me on Twitter was the classic, "How do I get to number one on Product Hunt?" So, my question to you is I know that's like ... There's not gonna be a silver bullet. Is there like a guide that you point people to that's like, "Here, just follow this advice," and/or, I don't know, two or three key things that you just gotta get right.
[00:26:44] Ryan: Yeah. Yeah, so in the posts below, there's actually a link- links to a bunch of guides and FAQs and things like that. So, it's really easy to find like sort of the best practices there. The team also has like this checklist. So, once you launch, there's like a checklist of things, recommendations or tips. And I'm actually forgetting like what each of them are specifically right now, but some of the things that I've noticed that make a big difference is we've already talked about the tagline copy, that goes to, not only the post, but also the maker. Usually people tend to add like some introduction, some context. Uh, generally a lot of people will, they- they manufacture PR speak there too, and so speaking like a human, I think, is important. Also keeping it a little brief. Some people write essays, which might be interesting, but the reality is most consumers, especially people on Product Hunt, you know, they're- they're flipping through a bunch of ideas. They're looking for things that spark their curiosity and interest.
And they probably not particularly interested in reading like an [laughs] essay, you know, from- from the makers. So, keeping that short, I think, is helpful. And then another big one is the gallery is- is often the first thing that someone is gonna see once they land on the page. And so, just naturally our eyes gravitate towards visuals. And some of the most interesting presentations I've seen is people use the gallery almost like a slideshow, um, like telling a story, where each slide is- is communicating like a different- well, a story of some sort. It could be like, "Here's the before and after with our product," or "Here's the evolution of what this product can do." There's many different ways to approach it, but like a really clean, you know, visually interesting story, um, can also be a great way to like capture people's interest in what you built.
[00:28:21] Lenny: Awesome. That was very tactical and helpful. If you were to launch something on Product Hunt yourself, and it wasn't like hunted by Ryan Hoover, do you think you would get to the top?
[00:28:30] Ryan: [laughs] I- I mean I don't know. It's- it's funny because if you ... We should do some like historical analysis on Product Hunt 'cause I'd be curious to know the actual numbers, but it varies all over the board. So, some people, they ask me, "Hey, like I don't know, is Product Hunt like ... Do B2B companies do well there?" And I'm like, "Yeah, like a lo- m- probably more B2B companies than B2C companies actually," and so you see, you know, seemingly boring companies that tap into something that- that- that people find useful or resonate- resonates with them, um, can go to the top. And then you also see the weird, wacky stuff, you know, the- the silly apps also hit the top. So, I don't know, it really varies.
And sometimes it's also driven by like the almost like the zeitgeist, like what do people find interesting right now? Like what's sparking people's interest? Because Product Hunt, on one side, you are potentially attracting people who might be future users and customers, partners, and so on, but it's also just a general kind of like zeitgeist of the early adopter tech community. Like what are they interested in? What do they find compelling in general?
[00:29:34] Lenny: Got it. Okay, so I have a bunch of questions from Twitter that people [laughs] wanted to ask you. And so, let me ask you a few of those, and they're kind of a little bit all over the place, but we'll see- we'll see where this goes. Jessica Toye, who's a- she's a PM at Angel List, she's actually a friend. We were together at Airbnb. She asked a great question.
[00:29:53] Ryan: Yeah. Jess- Jess is awesome. She- shout-out to Jess, she's like been super helpful on the Angel List side, so she's awesome.
[00:29:59] Lenny: Amazing. Okay, she's the best. She asked what you learned as a PM that has helped you in your venture career.
[00:30:06] Ryan: Yeah, um, yeah, so my- my background is, uh, marketing and then product management. Pretty quickly, uh, used to work in the gaming industry, which is like, I think, an- an awesome industry. Really hard to make it in that industry, but like amazing place to learn, and no, no, uh, I have so many biases, so I have to like be cautious of that, but I- I- having a product background, I think, is one of the most important aspects of early stage startup investing, meaning oftentimes, when you're building a new company, there are a lot of risks and there's a lot of important things to- to nail, but it all ultimately comes down to the product that you're building. And so, I think having a product management or a product background is helpful. And one, having more, I guess, perspective in evaluating different ideas and- and arguably more important, uh, how the founder thinks about things. So, it might be less about me evaluating the- the- the market need for this particular idea, but it's what's the thought process and how did this founder come to these product ideas and these insights. And so, I think having a product management background is helpful for that, and I don't know, I also just find it really fun to jam on product with founders. And when it's early, early days, there- there's more opportunity to create some sort of impact or, you know, help shape the product in- in a slight way.[00:31:20]
Lenny: Awesome. Basically if you're a PM, you've got a lot of the skills that you need to be a founder.
[00:31:24] Ryan: Founder and- and arguably, investor, um, as well.
[00:31:27] Lenny: Oh, and that's right. Okay. So, uh, Leo of Sousa Ventures, who's also an awesome dude, uh, he asked if you could go back and-
[00:31:35] Ryan: I saw Leo in, uh, Miami, uh, not long ago.
[00:31:39] Lenny: Oh yeah. He moved to Miami too. Oh my God. Everyone's over there. Okay, so [laughs], uh, he asked if you could go back and build Product Hunt again, what would you do differently? We talked a bit about this, but anything else?
[00:31:50] Ryan: Yeah. Um, I've been thinking a lot about this actually lately. And, um, yeah, I mean there's a few things. Uh, one, Product Hunt, in the very beginning, and still today, is very much focused on tech, and there was, at one point, ambition to expand beyond tech into all different types of, you know, categories of products. So, you know, we experimented with podcasts actually, podcast discovery.
We experimented in video game discovery, we experimented with book discovery, and the thesis there was, "Okay, this could be actually discovery platform for all of these communities to discover all these different products," and I think there was a lot of good ideas in that. However, I severely underestimated how difficult it would be to do two things: one, the product experience on Product Hunt is very different than how you would wanna discover video games or maybe, in the future, fashion and a bunch of other types of products out there.
And two, it's really difficult to translate a community and expand into other communities. Like some- some have done it. Like Reddit is maybe a great example, where Reddit has this massive [laughs] long tail of, you know, every kinda community you can imagine, but very few companies and platforms can actually do that. So, that's one- one regret is we should not have tried to expand horizontally. We should've just focused entirely vertically and- and served the tech community, you know, better and- and with more things, which is effectively what we're doing now. Another regret, another thing I would've changed is I would've- I would've actually tried to monetize and generated revenue sooner. We- we raised a seed in a series A and we had capital to grow, and we didn't actually try to make money until after we required Angel List.
And my thinking at the time was, and to some extent, there's some truth to this, is like everything you prioritize is at the cost of something else. You know, you- you're essentially taking focus from one thing and directing it to something else. And what mattered most was growth and to grow the community, but what I really should've done is dedicated maybe 10% of our focus on revenue generation because, you know, it was- once we started generating revenue, we- we did so very quickly, and we go to cashflow, break even, I wanna say a year, maybe 12 months after we started generating revenue. So, if we would've started in 2014 to make some money, we coulda been cashflow, break even, you know, maybe 2015, 2016, which would've just given us a lot of flexibility in kind of owning your own destiny and proving out some of the business model itself.
And then like the last thing, uh, I've been thinking about this lately is- is delegation is- is a classic founder challenge. You know, I- I'm just generally a controlling person. That's something I'm working on. And it's really hard sometimes when I have such strong opinions, and I'm very particular about certain things, uh, fully delegate and fully trust everybody. Not necessarily- we have an amazing team. Like I worked with some amazing people, still people that are Product Hunt today like six, seven years later. It wasn't anything about the skills of the team. It was just my own trust and my own delegation, and what I should've done is, you know, up until shortly before I left, I was editing the newsletter every morning, for example, like every morning. I was waking up, you know, 5 a.m., 5:30 a.m., editing the newsletter. I mean that's just kinda silly, you know, to be doing that so many years later after starting.
[00:35:02] Lenny: I totally get that drive to just make sure everything you're putting out and that your company's putting out is topnotch. I- I have the same feeling, and it is hard to [laughs] let go and just like, "That's not perfect, but I'm gonna- I'm gonna be okay with that, a few other things."
[00:35:16] Ryan: Mm-hmm. Yeah. It's- it's really hard, and I think it's a tendency that is, uh, in some ways, it's- it's good in that you care so much about the product as a founder. You care so much about what you're building. You care so much about the details, uh, and you need that kind of like almost OCD-like, uh, behavior, however, you also just can't scale yourself nor are you the best person at everything. So, I- I don't know. With hindsight I'm like, "All right, I should've delegated more. I should've trusted people more." And yeah, they'll- there will be more mistakes. I make mistakes all the time, but at the end, it's gonna be way net positive because you kind of have to [inaudible 00:31:30] your company anyway.
[00:35:54] Lenny: It’s a good segue to a question Harry Stubbings asked that he finds interesting always. What's the most painful lesson that you've learned and, but that you're also happy about to have gone through?
[00:36:05] Ryan: Yeah, yeah, there's ... I actually- I recently in the past couple weeks, wrote a blog post, that I'm not really able to publish 'cause it's- it's basically when you- there's certain things I wanna share that it- it- it can make things challenging and complicated for others. So, I didn't wanna put anyone else in- in a pickle. So, someday maybe I'll publish this post, but to speak more vaguely about it, like there's some hard- really hard times in Product Hunt, like we- we have all faced in- in different ways as founders, not even just as founders [laughs], just as people. Oh, yeah, there's some times where I felt physically ill, many different moments in- in Product Hunt. And um, it was just really tough, and you know, you- I don't know if- I don't know how to articulate that- that feeling but that flutter in your stomach that you wake up with in the morning of just anxiety and stress and- and worry.
Being a CEO or a founder makes it slightly harder in some ways because you still have to put on this mask. You have to put on this face of confidence externally and- and internally as well, where people need to trust you. You- you also don't wanna subject them to the same anxiety that you're feeling and be 100% transparent. So, it's- it's a struggle because, I think, I h- I don't know, I value authenticity so much, and I- I kinda like thrive around people who are authentic, however, there's this like tension with- with being a founder or CEO where you can necessarily share everything. So, anyway, everyone's gone through hardship building a company. You know, the positive aspect of that is like if- I- I think, hopefully growing some empathy for founders who are going through hard situations. I think it's made me a little bit stronger, maybe thicker-skinned for certain things. It just provided more- more perspective, you know, into the company kind of like building journey.
[00:37:41] Lenny: Okay, listen to this. If you can take 15 seconds to leave this podcast a rating on Apple Podcast or Spotify or any of your favorite podcasting apps, you could enter to win $1000 in cash, plus other fabulous prizes, including a one-hour coaching call with me, a box of custom swag that I've just created that's full of really good stuff, like an awesome water bottle and a hat with socks and a few other things. And you also get a one-year free subscription to my newsletter and even a goody box for Athletic Greens. It's a giveaway bonanza, and all you have to do is go to lennyspodcast.com/bonanza to learn more and enter the contest. Just make sure you apply by August 14th, 2022. Again, the URL is lennyspodcast.com/bonanaza.
[00:38:29] Lenny: We talked about how hard startups are and how many people should not start a company, but at the same time, part of this question, which I think you would agree with, is you're probably very happy you went through all that and- and wouldn't change, wouldn't like undo that, right?
[00:38:43] Ryan: Yeah. Yeah. It's kind of y- y- like a lot of things, you know, uh, what doesn't break you makes you stronger to some extent. So, it didn't break me, uh, it just scarred me a little bit but didn't break me. [laughs]
[00:38:52] Lenny: And turned you into the Ryan Hoover that we- that we have today.
[00:38:55] Ryan: Yeah. For better or worse.
[00:38:57] Lenny: [laughs] Maybe one last question from- from Twitter, Twitteratis. From Sandeep. He just wanted to know what- what have you found matters most to you or mattered most to you in life and in business versus what you thought would matter most?
[00:39:09] Ryan: Yeah, um, still figuring it out. I'm- I'm- I'm still asking the- the old stereotypical questions like, "What- what the heck is the meaning of life? Like what am I here for?" [laughs] All those things.
[00:39:19] Lenny: Let me know when you figured it out.
[00:39:20] Ryan: Yeah. And maybe, maybe there is no answer. Maybe the question is, is actually, um, doesn't matter. So I mean, if I'm honest, I'm still figuring all those things out.
Yeah. And maybe- maybe there is no answer. Um, maybe the question is- is actually it doesn't matter. Um, so I mean if I'm honest, I'm still figuring all those things out. I mean I think in- in life, some of the things that I've reflected on is, uh, so damn cliché, but sometimes when cliches are true is like friends and authentic relationships have been, I don't know, they just matter so much, I think. And the older I get too, it's less about, I don't know, I care less about having a lot of friends and more about a few deep, close relationships. And I don't know, I feel like that's very different than like middle school Ryan or like, you know, when you're in- on the playground metaphorically speaking, like where everyone's tryin' to be popular and, you know, meet a lot of people. And even- even joining and- and being, you know, uh, in San Francisco in the tech community, you wanna meet a lot of people and network and all- do all those things, that- that's less interesting to me and less important.
And then, more on the business side, the thing I've been thinking about is like, and I think this is obvious to a lot of people, but I think there's some nuances to it, which is momentum matters so much. And momentum is reflexive in that, you know, high momentum leads to more high momentum. Low momentum leads to more low momentum because there's this energy that- that kinda goes through companies where, when there is momentum, when people are shipping, when things are going well, other people feel that energy, and they wanna do the same, but in the reverse, someone who might be slowing things down, not shipping, not really performing very well, that actually does the reverse too. It- it might lead other people to- to feel less motivated or care less. And so, I don't know, momentum is- is this weird thing that, you know, you- arguably, it's one of the most important things in early-stage startups. And of course, it's an- an input to a lot of things, uh, but it's just so important to nail.
[00:41:00] Lenny: Mark Andreessen talks about that- that last point that ... There's like a word for it that I forget, that a company is either becoming a gravity and pulling in all resources and funding and attention or losing it. And it's really important as a company to know which one of those are you, and as an investor, you often wanna bet on the company that's just like they're just becoming the center of gravity here, and there's not a lot you can do to change that once they reach a certain point.
[00:41:24] Ryan: Yeah. Yeah, that's a really good point. I mean the- it also mirrors with like the power law of investing where it's- it's, in most people's situation, it's one company is returning ... You can invest in 100 companies, and one of those companies is probably gonna return three to five X in the returns of all the others, maybe combined in some cases. So, it's- it's wild.
[00:41:45] Lenny: On the first point that you made earlier about cliches and platitudes, it reminds me, Michael Pollan has this point that he makes that like cliches and platitudes are cliches and platitudes because we've heard 'em so many times but that- because they're true. People just say 'em because they're so true. And as much as we don't wanna hear them, like there's a reason that we hear them again and again. Uh, I had a similar recognition when I was on a little psychedelic journey where I'm just like, "Man, love is all you need. Love is all you need, man.”
[00:42:15] Ryan: [laughs] Yeah.
[00:42:16] Lenny: Okay, people have figured that out. But I was like, I feel that, I feel that right now. But it's true. That's why people- that's why f- [laughs] we're like, "Okay, shut up. I heard that. That's in a song."
[00:42:25] Ryan: [laughs] Yeah, it's- I was listening to- to a podcast, uh, about someone who was basically describing like psychedelics as a gateway into like meditation and- and everything and how it can be one of those things that makes people ... It- it- a lot of people who take psychedelics come across as another hippie cliché like person who like repeats the same things we've all heard many, many times, but there's a reason why there's a pattern there. And, you know, he describes like psychedelics as- as one way to feel that and learn that- that feeling that you can't achieve with- with meditation, you know, with experience.
[00:42:56] Lenny: Yeah, I think Sam Harris talks about this where you could either meditate for five, 10 years to work your way up the mountain towards, you know, enlightenment, or you could just take some psychedelics, visit it for a little moment, see what it's like, and then [laughs]- and then-
[00:43:09] Ryan: Mm-hmm.
[00:43:09] Lenny: be motivated to, to work on getting there more naturally
[00:43:12] Ryan: Yeah.
[00:43:13] Lenny: This is a good time to play a little game that I invented just for you. Okay, so you're the founder of Product Hunt. Okay. And, on Product Hunt, people up vote ideas that they like best. And so what I'm gonna do is I'm gonna give you two options and you tell me which you'd rather— which you'd up vote and it'll make sense once we get going. [laughs]
That sound good.
[00:43:33] Ryan: Okay, cool. Let's do it.
[00:43:35] Lenny: Okay. TikTok or Instagram Reels?
[00:43:38] Ryan: And, and is context setting, are these within the context of products? I, I like and know, or
[00:43:43] Lenny: Products you would choose to use that you like better... yeah. Not like which will do business— better business. Yeah.
[00:43:50] Ryan: Okay. Okay. Got it. TikTok's for me. It's funny, reels, I kind of joke with, with Susie, my girlfriend, I joke that it's like, reels is like, TikTok, but like two weeks late.
Uh, it's not entirely true, but I feel like I see a lot of TikTok videos on Instagram reels. Like after, you know, weeks after they've been published.
[00:44:08] Lenny: We'll see, I have some friends that work on reels and I'm excited to see where they go. Okay, next- LaCroix or Topo Chico.
[00:44:15] Ryan: Ooh, this is a tough because I- I- I'm generally a La Croix kinda person, but Topo Chico, I like the bottle. So, when Topo Chico's available, I'll go Topo Chico. I'm sorry, La Croix.
[00:44:26] Lenny: [laughs] I- I totally get that. My wife's a huge Topo Chico fan. We have many, many [laughs] bottles. They're beautiful. They've- kind of changed a bit. They're like super clear now, they used to have a little, a little tint.
[00:44:36] Ryan: Hmm.
[00:44:37] Lenny: Very important topics. Yeah. Okay. Next, next up, Bay Area or Los Angeles?
[00:44:43] Ryan: Uh, Los Angeles. Although, it depends on the- the, so here's my goals, if- if I was, you know, a new college grad or someone young and- and new in kind of the tech industry, definitely San Francisco. You'll create a lot of serendipity. You'll- you'll meet a lot of people, but from a lifestyle perspective, LA. Um, LA, I just find more enjoyable, weather's better, there's hiking, housing is cheaper. So, LA today, San Francisco, 10 years ago.
[00:45:09] Lenny: Very nuanced dancer. I knew you were gonna say LA, and so, next is East Side LA or West Side LA?
[00:45:16] Ryan: I don't know. We- we lived in Hollywood up in the hills for a while. So, I don't know if that's East or West, but wherever that is, big fan.
[00:45:24] Lenny: I guess that's West, right? It's not near the water. That's a really good question. Hollywood Hills, all right, that'll be a third [laughs] option. Okay, electric bike or regular bike.
[00:45:34] Ryan: Nothing against electric bikes, but I feel like if- if your goal is to get exercise, then just get a regular bike, but I don't have either. I have a- a, um, recumbent bike at home that I use for exercise. The reason why it's recumbent and not like a Peloton where you sit up is 'cause I can do emails and work [laughs] because while I'm exercising.
[00:45:53] Lenny: Wow. Very productive. Okay. Next, dark mode or light mode?
[00:45:58] Ryan: Light mode, I've never used dark mode like ever. Actually I take that back. Tweet Deck is the only dark mode kind of app that I use. But-
[00:46:06] Lenny: Wow.
[00:46:07] Ryan: I don't know. If- if a founder is prioritizing dark mode before they have product market fit too, it's like a big red flag for me. That's a little bit of a hot take. Some people are gonna hate me for that, but I don't know. I don't think dark mode matters for like 99% of people.
[00:46:22] Lenny: Wow. Big, big, hot take. What if they just go dark [laughs] and there's no light mode. Does that count against them?
[00:46:28] Ryan: Uh, Yeah, that's fine. As long as it's just one mode, um, it's the teams that prioritize all these, like small things that don't matter before the product is actually like useful for people or, or that that's, that is where I like my product manager hat comes in and I'm like, is this like the highest on your priority list?
I don't know. Now big asterisks, it's all contextual. Sometimes. Like the audience you're building for really cares about dark mode. Like if you're building for developers, maybe you need dark mode, or, or some version of it, but, but yeah, I'm, I'm light mode.
[00:46:57] Lenny: Awesome. Okay. [laughs] Did not expect that, love it. Okay, two more. Wash the dish right away or let it soak in the sink?
[00:47:04] Ryan: [laughs] Um, I'm looking at the sink over here. There might be dishes in there, so that'll be my answer. I got a bad habit.
[00:47:11] Lenny: No, I think there's- there's power in letting it soak. I get it. I respect that.
[00:47:15] Ryan: [laughs] That’s what I'll tell Susie next time. There's power. Lenny said there's power in soaked dishes.
[00:47:20] Lenny: There's physics. It's soaking. Okay. Last one, Web3 or Web5?
[00:47:25] Ryan: Mm, uh, I don't know what happened to Web4, so I don't know, maybe- maybe we'll split the difference, so I'm gonna go Web4.
[00:47:31] Lenny: Okay. We did it. [laughs] That was the inaugural addition of which would you rather up vote? Amazing. You killed it.
[00:47:38] Ryan: There you go go. I like this. All right. It's kind of a fun, this could, this could be a fun little segment, I think for a lot of things.
[00:47:45] Lenny: Yeah. It'll plug Product Hunt. It'll be great. We'll see [laughs] where this goes. This replaced my lightning round, which I experiment with. Okay. But actually I have other questions I want to get through before we, before I let you go. If that's cool.
There's kinda two topics. One is around consumer startups and just a few things that I've been learning there and then angel investing and then- and then we wrap.
So around consumer. By the time this post comes out, I'll have released some portions of the series that I'm working on, on kickstarting and scaling consumer business. And there's a few things I've learned there that I just wanted to get your take on. One is that, and we talked a bit about this just like 99% of consumer apps seem to just like, not work, especially if they're venture scale, if they raise money, just like just a reminder of how hard consumer is like, when is the last consumer app that really took off.
And so I just wanted to get your thoughts— is what's your take there? What should founders do that are starting a consumer company?
[00:48:40] Ryan: Yeah, yeah, it's tough. I mean there's- there's obviously consumer is pretty broad, so there's like different levels of difficulty, I think. Um, the consumer social or gaming, like games, building games, is probably like the- the- the hardest and the one filled with the most failures. And I think a lot of that is because, I think a few things, I think one monetization is generally harder than like a B2B company. Historically, a lot of it's been like advertising driven, and to do that, you have to first get to massive scale for advertisers to really care. And then you have to, you know, double it and double it and double it [laughs] again. So, monetization is super tough, versus a B2B company, it's like people have a problem, they have a need, they are willing to give you money, you know, on day- day one.
The other thing about consumer that's tough is you're- you're always fighting different, essentially you're fighting for attention. And so, you might be some consumer social company, but you're- you're kind of like competing with Netflix too, which isn't in your direct domain, but like people could be watching Netflix, or they could be using your product or- or your social app, let's say. So, now you're competing with so many different things. Many of those are incumbents where the consumer also has like built-in habits, routines. Like this is a big- big part about consumers too is eventually you wanna be like an internal trigger in someone's mind where they- they just, without even thinking, they go and use your product or services for some reason. Usually, you don't start that way. You need like external triggers to like pull people in, but eventually you have to get to that point. So, how do you overcome those internal triggers they have for other services, other products? It's really, really hard.
And- and then I think a lot of it is, um, like B2B companies, usually you- you have a clear like problem that you're solving. And you could talk to customers, you could understand what are their current behaviors, what- what solutions are they using now, what do they like about them, what do they not like about them whereas, consumer, there's a little bit of that, but it's- it's fuzzier. You know, if you take, um, like Twitter and you kind of even ask someone like, "Why do you use Twitter and like w-" people will have different answers that are all kind of like fuzzy. And they ultimately tend to come down to some sort of like innate human desire. Like it could be, uh, for Twitter, it could be about like, "I wanna be informed with what's happening in the world," or it could be, "I want to feel less lonely or connected to more people," or something like that whereas, if you go to, let's say DocuSign, I think is a great example, of a B2B company, it's like super simple. [laughs]
It's like a- a way to get legal docs signed online. That's- that's what it does. It's a thing that people have to do. It's very clear like what it solves. And so, B2B's just like easier to navigate that idea maze. And so, with consumer, you- your- your first blog post on this topic touches a lot on the idea side. And I- I, a lot of it resonated with me, especially the- the insight piece. Like what is- what is the insight that you, as a founder, have to build this thing? Because I think it's really hard to build a consumer company without some sort of unique insight, maybe impossible. And you can get that in many different ways. It could be through your own experiences. I used to write like a problem journal. Like just when things annoyed me or when things were like less efficient, I would write it down as like a note. And I didn't try to solve it. I didn't- didn't say, "Oh, here's the solution." I was just like, "This is annoying."
Like, in San Francisco, one example is a lot of people don't have laundry like in their unit. So, I'm like, "That's kind of annoying. Like that's a problem. Maybe there's a solution out there." So, things like that. And I know, there's- there's- there's a bunch of different ways, like, uh, y- your- your blog post does a better summary, I think, of like the different ways different companies like ideated and came up with their ideas, but yeah, many different ways to navigate it but needs an insight of some sort.
[00:52:09] Lenny: Awesome. I hadn't heard that, u- u- uh, that pr- problem journal idea. I was gonna ask you if you have any suggestions for how to come up with a startup idea, and that's a really interesting one. Is there- yeah, so I guess it'd be cool to hear where that came from and what that led to? Or if there's anything else you found to be useful around that?
[00:52:23] Ryan: Yeah, yeah, the problem journal is one. And again, like I think it's helpful, not to try to come up with the solution, but just write- just simply write down the problem you- you observed or experienced. Another one I think's interesting is just to like immerse yourself in different communities. Ideally, like maybe like seemingly niche or weird long tail communities. It doesn't have to be that necessarily, but that might be where you'll see more unique insights or- or gather more insights, and you could do that through, I don't know, I'm just thinking subreddits, meeting a lot of people who are like really excited some other thing. It could be like some weird robotics like niche, hobbyist community, for example. And a lot of that, I think, will- will hone or just like create serendipity for ideas. You might see patterns, or you might see, you know, if problem statements emerge from many people in that community that are facing similar things.
And then there's like the other- other component too, which is really about like observing trends and- and changes, whether it's like a consumer behavior shift. Let's take an obvious one. Today is like distributed working. So, five- five years ago when the Weekend Fund started, that was one of our themes. It was like I- I- I think distributed working will be on the rise for a number of reasons. One, you know, i- it's harder and harder to recruit. Two, there's a subset of people who really valuable that flexibility and autonomy. And then fast forward, we had COVID, so like we had remote working, and- and now, that's a huge consumer behavior shift. Not just in how people work but also, like going to your Airbnb like world, like Airbnb has shifted their entire product to support more of this remote working kind of lifestyle, just the way that the- the homepage is now more of a catalog of places that you could explore at different times of the year versus Airbnb before was more like, "I have a very specific vacation trip that I wanna take during these days in these areas."
It's like a very different like browsing kind of experience. So, that's just one example. Consumer behavior shifts is one thing to observe. The other is technology shifts. So, what- what new thing can you build today that couldn't be built yesterday? And so, there's- there's a bunch of categories around there, like Web3, AI, you know. The biggest shift that we've seen is- is mobile in like early 2010s, um, 'ish, that unlocked a whole- whole bunch of things. So, so, yeah, I think it's observing those shifts and those changes. Last thing I'll say on that is like I think startups, since there are more and more people building companies and technology, there's essentially more efficiency. It's certainly not a- an efficient, super efficient market, but there is more efficiency in problem discovery and- and- and solution exploration. And so, for that reason, you need even more reasons for things to- sort of answers to the, "Why now?"
Like what's changed? What insight do you have? Why doesn't this exist already? 'Cause a bunch of people are trying to build something in the space most likely. Just a lot of what we think about, especially on the investing side, when we talk to founders.
[00:55:14] Lenny: Wow. There's s- way too much good advice there. Have you written this down anywhere? Is there a Tweet thread people can find like your kind of approach to coming up with an idea?
[00:55:22] Ryan: I have not, I don't think so.
[00:55:24] Lenny: Cool. All right. Now we have to-
[00:55:26] Ryan: Blog post for the future.
[00:55:27] Lenny: Yeah. Or this is the, uh, this is the- the- the content for people to save and use. Thanks for sharing all that. That was really helpful. One other question I wanted to ask you along these lines is around the target audience and, uh, something ... A- an insight that we both share is that it's really important to get really narrow, whatever you focus on initially, as a start up, and it's, for founders, it's often so counterintuitive, they're like, you know, it's like, "Oh my god, why should I focus on the 1000 people? Or 10000 type people-
... Versus the millions that might wanna use this thing?" What's your sense, and where have you kind of seen that become important? Just the idea of getting very narrow of how you're going after.
[00:56:05] Ryan: Yeah, it's, effectively, the more narrow you're- you're generally, and this is where I throw in the big asterisks, like not for everything, there's always contextual differences, but generally, the easier it is to build a great solution for those people, because now you can actually hone in the product experience, the messaging, and everything to serve exactly those people. And it can help with the product side, it can help with the marketing and go-to market where you- you're messaging ... When people land on your homepage, you don't need to create kind of a broader kind of like value prop to everybody, but really, you can focus on like what is the- the problem this particular audience or community is- is facing. And so, generally, it's just easier.
Now there is always that challenge of like, "Well, is this too small? Is it too- too much of a niche if- if my goal is to build like a massive company?" My bias is not to worry too much about that because what you probably find is, over time, opportunities to expand beyond that. You'll see parallels, maybe to other communities or to other problems. And a lot of companies, you know, eventually expand well beyond that. Like I'll go back to Airbnb, you know the story way better than I do, but you know, initially, it was just like, you know, basically couches and extra rooms in houses. And like a lot of people, most people in the US would not do that. Like my parents, not- not in a million years. Even me, like I don't wanna like stay in some stranger's like room. I want my own space, my own house. So, that- that probably at the time seemed really niche and like small, but obviously, they extended- extended well beyond that.
Now- now I view Airbnb as like housing in generally speaking. Like their- their TM is housing in- in my mind, which they haven't yet exp- expanded into like real estate sales or like longterm rentals, per se, but like that- that's a possibility.
[00:57:51] Lenny: This is a good segue to the last topic I wanted to touch on, investing, which I believe you do full-time. Would you say that it's- your full-time gig now?
[00:57:59] Ryan: Yeah, yeah, it is. Yeah, I'm spending all my time there, and yeah.
[00:58:02] Lenny: Cool. So, from what I can tell, the Weekend Fund is killin' it. I'm not an LP, but it feels like it's kind of this underrated juggernaut that's just doing very well. And so, I wanted to ask you a couple questions along these lines. One is what have you learned about investing, angel investing? Especially what's most surprised you?
[00:58:20] Ryan: I mean I feel like there's a lot ... A lot we've learned. So, there's- there's things on the operational side. Like running a fund, there's a bunch of things that go into it, from LP communications, LP fundraising. There's also like ... Vedika who works with me on the fund side, she, um, she describes it as like hygiene. There's also good hygiene when it comes to running a fund. For example, you know, when you meet a founder, you- you- you should get back to them. [laughs] Like if it's a pass, you should let them know. And then there's a lot of different ways that you can do that. Some people, you know, might just say like "pass," and that's not very encouraging to a founder if they gave you no context, no details. There's also an element of hygiene, which is you always follow up with the person that introduced us to that company. And we just feel it's kinda like that's what we appreciate.
Like we like to kinda know what happened, like s- have them close the loop. And so, there's like good hygiene, operational things that we've learned and kinda honed over- over the years. I mean the biggest surprise, the biggest surprise has probably been ... I gotta be careful of how this is interpreted in some ways, but it's ... There are cases when I didn't think the company would make it. I- uh, either the product wasn't working, and you know, many months had passed, and it was very clear that they're- they- well, to me, I thought it was clear that, okay, that this probably isn't gonna work out. In my head I kinda wrote it off. And then that company either pivoted or- or some m- like massive partnership or MMA event came through out of nowhere, and so I- I guess the learning is like never count a portfolio company out until it's over.
And, you know, uh, that relies on, of course, backing founders that are very resilient and creative and- and, you know, driven to- to create momentum, you know, out of nothing, but- but that's been surprising to me. And it makes me kind of excited because, you know, we invested in over 110 companies now and it's- it's fun to be able to kinda see behind-the-scenes a little bit how all these things kind of play out, both the good and the bad.
[01:00:13] Lenny: That's such an inspiring takeaway. Does that change how you invest? Like to me, that's like, "All right, I guess I should just take more bets on founders that are awesome." Although, I find just founder bets, it's like a very expensive hobby/approach because there's so there's so many great founders. How is that informed how you invest seeing that happen?
[01:00:33] Ryan: I would say we don't, we don't have like, um, it's again, my cop out it's contextual kind of answer. Like, you know, some people are like, "We are a team first only." Some are, "We're market first." Some are, "We're product first." And we- we look at everything kind of holistically, and I think the evaluation of the product is- is sort of a reflection on the team. So, our- our assessment of the thinking behind the product that they built today and maybe some of the traction is a reflection on like the team's abilities and like the thought processes.
So, we try to look at it holistically in, um, I mean, yeah, I mean every investor would say like, "Yeah, we wanna back, you know, resilient founders that are very driven, insightful, and all those things," of course. But it's also sometimes hard to like fully evaluate that, unless you really know that person. So, so, we try to- to- to take as much data around like how the product is working and how they made those decisions leading up to this to- to evaluate the team sort of indirectly.
[01:01:26] Lenny: That's kinda what I've started to do is I- I try not to invest as a founder bet unless I just know them because it's just so hard otherwise.
[01:01:35] Ryan: Yeah, yeah, there- there's a few founder bets that- that we've made. One, going back to the consumer social kind of thing, he's somebody I've known for many, many years. One of the most talented like designers, engineers, product builders. And I've just been waiting for him to start a company and- and so, that was- that was one of those, "I'm gonna bet on you because I believe in you. I'm not sure about this first idea, uh, you know, who am I to judge? But I don't know if that's gonna be it," but [laughs] he's probably gonna launch 10 apps, and the 11th is gonna be a massive success. And so, that's sort of the- the way I think about those consumer social founder first bets.
[01:02:10] Lenny: I love that. Last question along these lines, for someone that's hoping to get into investing or angel investing in the near future, do you have any advice for folks around that?
[01:02:20] Ryan: Yeah, actually, I wrote a tweet storm and like converted it to a blog post on this 'cause we've get- gotten a lot of ... You probably as well, get a lot of emails or people saying, "Hey, I'm thinking about raising a fund. Like how should I do that?" or "I wanna get into- to venture. I wanna start investing. Like what advice do you have?" So, yeah, I wrote a blog post on this, and there's many different ways to invest. There's, you know, angel investing is one. So, great thing about that is if you have the capital to angel invest, you can do it today, tomorrow. Like you- there- there's no- no sign-offs required. You have maximum flexibility, but of course, you need to have disposable income. You need to be able to- [laughs] be willing to lose all of it and then hopefully you, you know, you'll ma- you'll be on the other side of that and make some money in 10 years.
It takes a long time. There's scouting; that's another option. And there are more and more scout funds probably than ever before right now, in different flavors. Some of them are like dedicated kind of scout programs where you have capital to deploy on your own, some are more like you still need approval, but you send the deals, and you get carry on those deals in many cases. Those have pros and cons too. Like they're easier to start and get into than raising a fund typically for most people, but you also are sort of reliant on that- that program or that fund. Um, you might have less autonomy in what you can invest in and what you can't. And then there's a few others; there's SPVs is- is one angle, which works really well for a lot of people. So, um, for those that maybe don't know and- and listening to this right now, SPVs are essentially like a single vehicle, um, investment into one company.
So, you raise money from LPs, from other investors, to invest in this specific company. And there are a few great things about that. Like one, you get deal-by-deal carry, meaning like the- the outcome of that company is- is you get paid when they exit essentially, assuming there's a positive outcome versus a fund, like you have to return the entire fund first. Two, it allows you to also bring in maybe very strategic, helpful people into that particular round for that company, which can actually be a- a strong value add for that founder. The biggest trade-off is it's a lot of work sometimes. You- you have to basically do a fundraiser [laughs] every couple you invest in, and that's super time-consuming for a lot of people. And then the last thing is like r- rai- raising a fund.
So, that's the decision that I decided back in 2017 is I wanted to raise a fund. It's a lot more work to raise the capital and- and- and there's a lot more responsibility in managing funds and so on and so forth, but it provided me with the most flexibility and- and a way to deploy many checks into many companies, especially when I didn't and still don't have like a ton of money to angel invest. So, yeah, those are like different options. Like I think my blog post goes into more like pros and cons for each of those things, but the last thing I'll say actually is, let's say, none of those are really an option. You- you- you don't wanna start a fund. You don't have enough relationships to do SPVs. You- for whatever reason, you can't do a scout. You don't have any money to angel invest. One thing you can also do is just like pretend angel invest. [laughs] And that doesn't mean that you're meeting the founder and like writing a check, but you can write memos, or you can like almost create a fantasy portfolio.
And this is what Vedika, before she joined- joined me, was doing to some extent. She was writing memos about companies she was excited about. And in some ways, she was like doing the job before getting the job, and anyone can do that today. And that can be helpful too if you're applying or trying to prove your- your- your abilities. You could say, "Hey, here are the memos. Here are the companies that I would have invested in, you know, if I had the opportunity, and, you know, here's my thought process behind that."
[01:05:49] Lenny: I love that. I'm curious about the logistics of knowing the prices of all these startups, but anyway, we don't have to get into all of [laughs] that. That's an awesome idea. I've seen people on Twitter do that too. What's- where do you think this all goes for you? Are you thinking of increasing the fund? That's basically the last question. Just, yeah, what's- what’s- the future of Ryan- Ryan Hoover at this point, as far as [laughs] you know?
[01:06:08] Ryan: Yeah, still- still figuring out the meaning of life, as we established earlier.
[01:06:12] Lenny: I thought we cracked that one.
[01:06:13] Ryan: Yeah, yeah. I'll let you know when I figure it out.
[01:06:15] Lenny: Okay.
[01:06:16] Ryan: Um, uh, [laughs], um, yeah, we're on our third fund right now. We're actually about 30, 35% deployed, so we have plenty of- of capital, and we're not gonna be raising any time soon. Yeah, we're just investing in early stage companies right now, but yeah, when I fast forward like longer term, I don't know. I will always be investing. I'm also more of a fan of maintaining a smaller fund. Our latest fund is 21 million, and that might ... I might change my mind on this, but that might be the biggest fund we ever raise. I might keep it around that same size for the next one because it really allows us to be f- really collaborative. We can write smaller checks. We can fit into competitive deals. I think it's a better product for founders. Like we're not tryin' to take the entire round. We can, you know, try to bring on the Lennys of the world as co-investors, things like that.
And so, investing will always be a part of my future, but I also love building. Building is- is the most fun, so creating something is- whether it's a company ... I don't know- I don't know what it is. I'm not even gonna call it a company, but building something is hopefully in my future. I just gotta figure out the right idea. And maybe, maybe reflect on your blog post too on the idea generation stuff that you shared 'cause that- that is helpful.
[01:07:22] Lenny: As long as you let me invest all is good.
[01:07:27] Ryan: [laughs] I don't know- I don't know if I'll- part of me is like, "Do I ever wanna raise from venture?" Now it depends on the idea. If- if I need it, if it's required strategically, then yes, but to be quite honest, maybe I shouldn't say this, like I'm kind of really interested in just owning something 100% and you can always raise venture later. Like it- it's a one-way door, so I kinda wanna delay that door, you know, for whatever I build next, if I can.
[01:07:53] Lenny: I 100% get that. That's how life is with this newsletter operation and I highly recommend it.
[01:07:59] Ryan: Yeah.
[01:07:59] Lenny: If you can pull it off. Okay. Um, that's it. Just a couple- just where can people find you online? It's kind of a dumb question 'cause you're very easy to find, but where do people go to learn more if they wanna reach out? And then- and then how can listeners be useful to you?
[01:08:14] Ryan: Yeah, I'm just, uh, easy to find. R- Rhoover on Twitter, Ryanhoover.me, simple website. I have a bunch of old blog posts on there, probably with a bunch of broken links and broken images, but it's there. The content's there. I don't know. We're- we're investing- we're investing in the early stage companies, B2B, B2C. If you're building something weird, I don't know, DM me, email me, I'm around.
[01:08:35] Lenny: Amazing. Ryan, thank you so much for being here. It's kind of a surreal experience interviewing you. And I'm really honored that you came, and I can't wait for people to hear this. I'm really happy about all the nuggets that [laughs] I was able to extract out of your head, and thank you for sharing them. Thanks for being here.
[01:08:52] Ryan: Yeah, thanks, Lenny. Yeah, these- these conversations are- are helpful and like reflecting on what do I actually believe anyway. So, it's- it's just like writing, it's helpful.
[01:09:00] Lenny: Yeah, and it is just as helpful to everybody else. So thank you again.
[01:09:04] Ryan: Cool. Thanks Lenny.
[01:09:06] Lenny: Thank you so much for listening. If you found this valuable, you can subscribe to the show on Apple Podcast, Spotify, or your favorite podcast app. Also, please consider giving us a rating or leaving a review, as that really helps other listeners find the podcast. You can find all past episodes or learn more about the show at lennyspodcast.com. See you in the next episode.