Confessions of a CEO: What got you here won’t get you there
Earlier this year I had one of the proudest moments of my career: I flew my entire team (100% remote) for an in-person meeting in Austin, Texas.
Besides all the sweet wildlife we saw, it was the latest step in the growth of IWT, which I started in my dorm room at Stanford. And now, look at this! It’s insane!
There are plenty of articles written for the guy on the left. Let’s call him Dorm Room Ramit. Dorm Room Ramit was a one-man “business” who didn’t sell anything. He also was severely calorically undernourished. But what about after that? How did I get to the guy on the right, CEO Ramit? (I’m in the back.)
So what changes between 1 employee and dozens? What happens when “beginner” advice isn’t enough? What happens when you have more tasks than hours in the day and you have to prioritize?
You have to rethink everything.
As I built IWT over the course of a decade, I found myself having to reinvent my core principles, and it’s something no one ever talks about.
After 13 years running IWT, here are 5 subtle but important things I changed my mind about as we grew. Dorm Room Ramit: Everything needs to be perfect
CEO Ramit: Live to fight another day
At the start of your business (0 to $100K revenue/year), every day you’re fighting to live another day. You have to be scrappy. It’s a game of survival, not perfection.
When I first started blogging, my site design was horrible. Everyone and their mother had an opinion on the color scheme, the headshot, and the font size. In the market, we were starting to see these beautiful “Web 2.0” websites, and I remember thinking, “I want that” and feeling like I was missing out because my site wasn’t PERFECT. And to be honest, it kept me down and unmotivated at times.
Check out that sweet headshot
What I didn’t realize at the time was that my lack of money was a blessing. Any wrong choice was at least an INEXPENSIVE wrong choice. And that let me fight another day.
I also wanted sophisticated tools so I could properly segment my list, and elegantly drop readers into the perfect email funnel for them. But I didn’t know how, and I couldn’t afford new software, either.
Instead, I bought a very basic newsletter tool, mostly used by bloggers. It wasn’t pretty — in fact, we set it up in this hack-y way because that’s all I knew how to do. We stuck with it for years, until we were practically bursting at the seams.
Years later, it would cost us lots of money to fix that in our next software upgrade. We incurred a ton of technical debt. But at least by that point, we had the money and the people to fix it.
If we had tried to be perfect to begin with, we would have been dead.
When you cling to the idea of these things you want (but can’t have yet), the tension gets to you. You become myopic about the work you’re doing:
- “Oh, I can’t start writing anything until I have a beautifully designed website.”
- “I can’t invite people to join my email list until I’ve written out a 15 email auto-responder.”
- “I shouldn’t do any guest posting until I have the perfectly optimized catcher’s mitt.”
Instead, we have to get comfortable with the idea of creating something imperfect. In the beginning, you can’t spend time A/B testing your email headlines. You need to find out if people will buy in the first place.
Too many entrepreneurs worry about stuff they don’t need to. They think they need to read books by Warren Buffett, master Evergreen launches and build an affiliate program before they’ve successfully sold their first product.
Not that the advanced stuff doesn’t matter. It does. But first…live to fight another day, and trust that your future self will be able to solve problems later on. Dorm Room Ramit: A popular blog is a business
CEO Ramit: A profitable blog is a business
This one I wish I framed and put above my desk when I first started the blog.
For the first year, I was so afraid of what people would say if I tried to make ANY money, I didn’t try ANYTHING. I didn’t even create an email list. It was enough to have the appearance of a business at first. But eventually, I had to come to terms with the fact that I wasn’t running a charity.
And neither are you.
But when I finally decided it was time to sell, I basically apologized profusely for charging the astronomical price of $4.95 for my first ebook.
Too many business owners track every vanity metric under the sun — visits, time on page, followers — because it feels nice to watch those numbers go up. That’s for beginners looking for any motivation to stay at it. I get it.
Meanwhile, they completely ignore the ONE metric that actually matters: Profit.
Time-on-site won’t pay your rent.
Money is the marker that you’re doing the right thing because money is the ultimate value to people. When someone is willing to open their wallet and give you their credit card — they value you enough to actually pay — then you know you’re doing something to change their lives.
And when the money starts coming in, you can use it to solve most of your other “beginner” problems.
- Too many customer emails? Now you can hire the world’s best customer service manager.
- Ugly headshots? Go buy new ones.
- Having issues with serving private video? Now you can pay $15,000 a year hosting your videos on the world’s best platform.
Of course, we’re not saying you have to charge on Day 1 of your business or that interaction with your customers needs to be transactional. Sometimes, you just want to do it for the likes.
But you have to be honest with yourself. If this is your business, then treat it like a business. And successful businesses need to be profitable. Dorm Room Ramit: Be good at everything
CEO Ramit: Be world class at a few things
When you start your company everything falls to you. You must know a little bit of everything to get the ball rolling. But eventually… it’s time to focus.
The world does not reward jacks of all trades. We’re better off becoming really good at a few things.
For example, early on I was writing blog posts, answering 100+ customer service emails, working directly with my friend (who was lending me his engineering skills), thinking about the logo design, and on and on.
I’m not good at most of that stuff!
I had a hard lesson to learn: Instead of becoming world class at customer service, and design, and engineering, and optimization (and on and on)….I really needed to become world class at building a team. The rest would fall into place.
Here’s what I chose to become really good at:
- Cracking the code on why people do what they do
- Understanding how to create products that people want — and products that get real results
For anyone starting out today, here are the three things I recommend you become world class at:
- Learning how to sell
- Writing amazing emails or blog posts that people open and read
- Learning how to build a team (even a small one)
Beware of choosing the wrong goals. If you choose the wrong things, even when you win, you lose. Case in point:
- Becoming someone who’s excellent at reaching inbox zero. Who cares?
- Focusing solely on a technical skill like Excel analysis, but never learning to build relationships and work with others.
- Getting the coolest design on your blog. So what?
Dorm Room Ramit: I don’t want to hire a big team
CEO Ramit: I want to reach millions of people
I don’t know why, but I used to constantly say:
“I don’t want a big team. I’d prefer to keep it small and intimate.”
Did I know anything about the differences between large vs. small teams? No.
Did I understand anything about managing a growing team, hiring, recruiting, retention, HR, etc.? No.
But I said it anyway.
Man, that was dumb.
Looking back, here’s what I was actually saying:
- I don’t know how to build a team.
- It’s scary and it seems like a lot of work.
- So I think I better say “I don’t want to do it.” That way I have an explanation for why I’m not doing it.
There’s only one problem…I wanted to reach millions of people. I couldn’t do that alone. Nobody can.
So I had two choices: Cut my goals of reaching millions of people (not gonna happen)…or learn to build a team. I decided to learn to build a team.
Each of us tells ourselves stories. We’ve created narratives of our lives, some of them so deep, they’re actually invisible scripts that guide our decisions and we don’t even know it.
I used to tell myself I was a skinny Indian guy (I’m not any more), that I wasn’t very athletic, and that — yes — I didn’t want to build a team. We can change most of the narratives we tell ourselves, but it is incredibly hard. Dorm Room Ramit: I’ll only follow “timeless principles”
CEO Ramit: What got you here won’t get you there
It’s comforting to think that if you find the right 2-3 “timeless” principles, you can build an entire company around them. You know, things like “put the customer first” or “quality matters.”
Wrong. Well, incomplete.
Principles like that matter.
But I realized I’d been operating under the assumption that if I just picked the right 2-3 principles, I could use them forever.
What I didn’t realize is that most of your days will be spent in gray areas. Should you build Product A or Product B? Can you afford to hire John? Uh oh, I don’t know how to grow my business any more.
A better assumption: What got you here won’t get you there (also the title of a great book).
The things that worked from $0 to $100,000 won’t always work when you’re trying to crack $500,000. They certainly won’t work at $5 million.
Therefore, you have to get comfortable being uncomfortable. This is really, really hard.
For example, guest posting was something that worked great for us to get traffic…in the first few years. Getting on sites like Yahoo.com, The New York Times, and a handful of other blogs helped grow our email list.
Imagine writing an amazing guest post and getting 2,000 subscribers. If you have 50,000 subscribers, you just grew 4% overnight!
But now imagine that you have 300,000 subscribers. You put the same amount of time into writing an amazing guest post, and you get good results: another 2,000 subscribers. But this time, it only grew your list by 0.67%.
You can see how certain techniques become relatively ineffective over time.
We continue to do it, but we’ve also invested into scalable SEO strategies — something I NEVER considered when I began.
Another example: When it came to video, I used to be able to just wing it if we were creating something for our YouTube channel or on a friend’s blog. You can go check out my early YouTube clips. But when I started going onto national television, I knew it was critical to invest in a trainer, because my skills alone wouldn’t get me to the next level.
Here are some of the challenges we’re facing today. They helped get us this far, but as CEO, I’m learning they may be holding the company back from getting to the next level:
- Remote work. Working remotely is amazing… until you see how much amazing work your team can do when everyone is working under the same roof.
- Writing product launches from scratch. Writing fresh launches is great…until you’re faced with the daunting task of writing 10-20 of them in a year.
- “I Will Teach You to Be Rich”. IWTYTBR is a fine name. There’s a lot of powerful brand awareness around it, until you’re trying to recruit a new employee who doesn’t know your story.
Does this mean that starting tomorrow, we’re going to ditch the name “I Will Teach You To Be Rich”? Probably not, but you never know. What got you here won’t get you there. Looking back on Dorm Room Ramit
First off, there’s a huge amount of material written for people just starting a business — “How to get your first 1,000 subscribers” and so on — but very little written for people making the move to an intermediate or advanced level. I want to change that with the material on GrowthLab.
Second, looking back now, I had some pretty dumb ideas about how business really worked. I hoped that I could read a few books, write down a few key principles, then magically grow my business. Oh, and all without hiring anybody and without changing my playbook.
The biggest lesson I learned was to get comfortable with discomfort. It’s really uncomfortable learning how to get your first customer. Then one day you realize, “Hey, I know how to do this.”
This is the decision point. You can keep running that same playbook, and getting one customer after another…
…or you can say, “I know how to do this — what’s next?” and begin working on strategies to get your next 10 customers. Then 100. Then 10,000.
That involves things you might not have ever considered, like hiring, corporate finance, and engineering management. Most of all, it involves looking into your own narratives and mastering your inner psychology.
That is the key to growth.