Why Financial Planning and Goals Do Not Work

Twenty three years ago, I was working on my own freelancing doing website design. I’d been doing that for a few years and got bored working on my own, frankly. I was just in my apartment, got out of bed, rolled to my desk, did work, rolled back to bed. Not really what I wanted to do long term. So I hooked up with a couple friends who were also looking to start a business, website design business, and that’s where we started the business. And then a few years later, we started making Basecamp, the software that we’re known for today, because we needed it for our own business.

We were doing a lot of website design projects that had a lot of clients, and we couldn’t really keep things in order. We were dropping the ball, missing deadlines. Clients didn’t know what we were doing. We didn’t know what we were doing. And so we built this thing, eventually became Basecamp to manage those projects and that work. We started using it with our clients, they said, what is this thing? We need this for our own business. And we said, ah, okay. So turned we it into a product, put some prices on it, put it out in the market in February 2004, and about a year later or so, it was generating more revenue for us than our website design business.

So we stopped doing website design and been doing Basecamp and all the products ever since.

If I had to pick something, I don’t like structure. I don’t like requirements. I don’t like waking up and working for other people and doing what other people tell me to do or what I’m supposed to do. My entrepreneurial independence streak is an example of me going in the opposite direction of that. Running my own show, not taking money so I’m not beholden to anybody. We don’t have a board of directors. All the things we do as a business are very much centered in independence and being able to do what we want to do our own way.

I’m guessing that is tied somehow, somewhere to my past where I felt maybe tied down or limited. Were you good in school? Not really. I was a c or b student, and I was average, mostly because I just didn’t really find a lot of it interesting. There were some things I really did find interesting, but it always came down to my teacher. If I had a great teacher, I was into it. If I wasn’t a great teacher, I wasn’t so into it. What are you running towards, Jason?

What I probably would say is I’m running towards eventually not doing this anymore. That’s what I’m running towards at some point. So I’ve been doing this for twenty three years, but, obviously, I’m not gonna have twenty five or twenty three more years ahead of me in this job. That’s just not gonna happen. For me, I think probably I’m running away from this. But that’s where I have to be headed naturally, I think. I’m curious to see what someone else could do with this business.

taking my first sabbatical in January and February, about six weeks. But for me, it’s the first time I’ve been away. I will have been away from the business for that long. I’m looking forward to that because I think it’s gonna be quite clarifying for me. What is it like not to do this? Can I not wait to get back? Do I like the distance? I don’t know. But I feel like I need to know, and this is the first step towards that. Personally, I have this fantasy of basically not doing this, closing my laptop, and not opening a computer again.

I don’t like looking at computers all day. I like making things, which is what I get to do at work. But I don’t like the mechanics of of sitting in front of a computer and looking at it all day. So whenever I am done with this, I like to close my laptop for at least a year. I’ll have my phone. I can connect with people if I need to, but I don’t wanna be looking at a keyboard and looking into a screen for a while.

And here’s the thing. I’ve got two young kids. I’m very occupied with life other than work too. I think it’d be different for me if I was quite a bit younger, solo. I think I probably would have needed work more than I feel like I need it now, as much as I still do enjoy doing it.

hard. I think there’s a lot of risk baked into this that people haven’t thought about. They assume that companies will be around forever. Big companies will be around forever. They see brand advertising all over. It makes people think there’s stability there, but there just simply isn’t. If a company can’t make its own money, they require outside money. Outside money dries up. Things have to change, and there’s gonna have to be layoffs, deep cuts, some austerity measures. These companies are gonna realize they probably have too many people, and they’ve been spending wildly on things that don’t work.

They’ve been just in a a market share grab, so they’re losing money on every customer, but they need to grab them because otherwise someone else will grab them. There’s this whole mentality out there that I think it’s gonna shift. It has to shift. It’s not even that I think it will. It has to. It’s basic economics. If you don’t make more than you spend, and you don’t have a lot of cash sitting around, and you burn through it, and you’ve gotta be a different business. I think that’s creeping up on a lot of companies right now.

And the problem is that they’re not practiced in the art of profitability. They’ve gotten really good at spending money, but not really good at making money. They generate revenue, lots of revenue, but the way they operate their business doesn’t pay off ultimately in the end, so they’re going have to figure out how to do that on the fly quickly.

There’s a lot of customers out there. There are a lot of companies out there. And we get customers flooding to us from Jira all the time. And I’m sure Jira gets customers that are coming from us all the time. There’s a transfer all the time. People trying this, trying that. They try something for a while, doesn’t work. They try this for a while, they come back and forth. The thing is that it doesn’t matter to us how other people are doing in terms of the number of customers they have.

This is, I think, something entrepreneurs get wrong all the time. They compare themselves to someone else. And they go, how many customers do they have? How many customers do they have? All that matters is do we have enough customers to make our own business work? That’s all that matters. So I’m happy to see Atlassian, Jira, Trello, whatever their products do well. That’s great. We can do well. They can do well. This is not a zero sum game. We have our own economics. They have their own economics.

As long as we can make our economics work, which we have, we’ve been profitable for twenty three years, every year, It doesn’t matter how many we have versus how many they have. All that matters is can we make our business work. I don’t care about any of those things. And I know the reality is customers come and go on all platforms, and that’s just been the truth of two decades of being in this business.

Again, it comes down to what are your economics? I’m just making up numbers here. Let’s say it costs us $5,000,000 a year to run our business. I wanna make 6. That’s good. It’s not about scaling up or scaling down. It’s covering your costs and then coming out with a profit on top of that. This idea of scaling for what reason and to what end, and where are you going with it. There’s so many companies scaling and losing their ass. That doesn’t seem like a good plan.

They’re getting bigger and bigger, and so are their losses. That doesn’t work. And if they follow the same path, they’re gonna keep losing more and more because they’re unprofitable for customers. This idea of scale has never been something that really made any sense to me. What makes sense to me is, how do you operate profitably? That’s how I know how to run a business, and it might mean we’ve left plenty of opportunities on the table, or we could have been bigger and all these things, but bigger for what reason?

I don’t want to be bigger and have much lower margins. I don’t want to be bigger and lose money per customer. I don’t want to be bigger and have to take a bunch of money to support that growth. I don’t want any of those things. To your second point about advising, don’t worry about everyone else’s business. Worry about your own business. What do you need to survive? What do you need to be profitable? Where do you want to go? It’s all that matters. I think it’s too many people focused on what everyone else is doing and the industry and all these things that don’t really matter that much.

We pay to what’s going on, but really, you’ve got to make your own business work, don’t worry about everyone else’s.

The other part of it is simply, would I want to do this again, Is what we’re doing on a daily, weekly, monthly basis, are we enjoying doing that, and would I want to do that again? If I could choose, would I want to live that month over again? Because if we’re making a pile of money and we hate each other, not interested in that. If we’re wildly profitable and every project sucks and people don’t want to be here and I don’t want to be here, that’s not worth it.

It ultimately has to be about, do you want to keep doing this? Is this a place you want to spend your creative time and your craft? Is this a place you want to hone that and enjoy that and work with great people that you like and all those things? That has to be number one. Profitability has to be like one a. Because if you don’t maintain profitability, you have to rely on outside sources of money, and then you’re beholden to all sorts of realities that you don’t control.

Not that you really control any of these things, but it just becomes a lot harder. And I don’t want to spend my days worrying about how I can make some fund a lot more money. I just gotta figure out how we can make our own business profitable and enjoy the work that we’re doing. That’s really it for me. We don’t have financial targets. We don’t have financial goals besides being profitable. I’m not aiming for a certain percentage of growth in a given year. What do you If we’re flat or even down, it’s okay.

This is okay. It’s all about the long term trajectory. It’s not about this year versus last year.

I’m not a goal driven person, so I don’t drive teams with goals. I don’t have goals, really. I don’t really believe in that. I know a lot of people do, but it’s not my thing. It’s never been my thing. My thing is, like, do the best job that you can, and why wouldn’t you just do that? That? What is it about the goal that makes you do the best you can? I think you should be intrinsically motivated to simply do the best you can. There’s not like a thing that I would do differently if there was some number ahead of me.

In fact, I probably would hate it more because now I’m chasing something that’s arbitrary, ultimately. People set up these targets, and we’ve done in the past, you set up some target and you aim for it. It’s like, why do we pick that number? That happens to be a nice round number. Everything I’m doing now is based on some made up number that happens to be a nice pretty round number, and the stress I’m taking on and the challenges we have are all based on this thing that we made up.

How about we don’t make anything up and just do the best work we can on a daily basis? And that adds up and let the chips fall where they may. That’s my approach.

First of all, management is really the art of the individual. When you evaluate people, we do performance reviews, but we don’t have metrics that we match people up against. Because I don’t think a lot of people actually have the power to change a lot of these things. So we know if someone’s doing good work. Their team knows that they’re doing good work. Their team knows where they’re deficient. They should know where they’re deficient. We should know where they’re deficient. And we talk and discuss and encourage people to improve in this area or reward them, not financially, but praise them or support them if they’re doing well in this area.

A There’s lot of recognition that happens in the company. It’s about knowing the people you work with, and part of this is that when you have a relatively smaller company, we have about 80 people, you can pay pretty close attention to the work people or individuals are doing, and you have a pretty good sense of how they’re doing. And there is a relative nature to it because there’s other people at the company who do similar jobs. So there’s some contrast there. You look at the work, and you don’t look at at the results that they aren’t directly influencing.

For example, someone’s working on a feature in Basecamp, some improvement to the calendar. That’s not gonna drive any bottom line stuff. It should be better because we wanna make an improvement. I can look at the quality of the work that they did, the details, the thoughtfulness, the code quality, the design quality, all the things that they’re supposed to be doing well. I can look at those things and judge the person’s work versus did that work have an effect on some other made up number? I’m not interested in that second part of that conversation.

Yeah. Part of this too is one of the things we do is the first year is, I would say, people are hired, but it’s a test. The main question we ask at the end of the first year is, would I hire this person again? That’s the real question that we ask after the first year. We don’t ask it out loud, but that’s what managers are asking themselves. And that question sums up a whole bunch of things. You inherently know the answer to that question if you are working with someone closely.

Yeah. In many cases, that can happen. Ultimately, it depends on the kind of company you want to run. We want people who we would rehire. And if someone’s fine, but not quite right, they’re better off finding another opportunity somewhere else. Sometimes there’s these really hard decisions that are made around that period of time about, this person’s cutting it, they’re fine, they’re good even, but they’re not quite right for us. Given the choice, we probably would not hire this person again, knowing what we know now. Could be cultural fit, could be skills, could be a lot of different things.

They may have come in at a level where we thought they were better than they were gonna be. Maybe they’ll be that good in three or four years when you can just hire someone else instead. Maybe that’s the choice. So that’s what the first year is really about. Is this person gonna fit in here, and are they on a trajectory that makes

Yeah. I mean, it’s not easy. I’m not great at it either. I think the best thing is to be very direct and show examples. When you say to someone like, your work’s not up to scratch or whatever, why not? Let’s go through a few projects. Let’s talk about a few things that happened. I think the more specific you get, the better off the feedback’s gonna be, and the more someone can actually internalize it. Because if it’s abstract, it’s not up to snuff, the quality isn’t quite there, whatever, it’s just not enough to go on.

We tend to review projects, and we’re always trying to look at real things here. When we hire people, we actually hire them first for a week on a contract basis, one week, not in every position, but in some, to actually do a project for us. And then we can actually look at real work together, discuss real work together, to decide whether or not we can actually work together. So we’re always trying to look at real stuff as much as we possibly can. I don’t really care about resumes.

I don’t really care about a lot of that people’s history. I don’t care where they went to school, if they went to school. I don’t care about any of those things. Let’s look at the work itself. And so the same thing is true if you’re giving someone feedback that’s not great. Let’s look at some work and let’s talk about why this is the case.

So for example, again, to get more specific, the last three projects we worked on, someone had to redo a number of the things that you did, or there was actually quite a few bugs associated with this piece of software, or the copywriting was very confusing and customer service kept getting these questions about things, and this has come up a few times in the products you’ve worked on. And so we want to point to real things, and that’s the best you can do, but it still sucks, it’s still hard, I’m not good at it, Other people are better at it than I am, but I think you have to get real with these things.

That’s the only way to really get useful feedback.

This was a year and a half a little longer than a year and a half ago. We made this call to say we’re not talking politics in the places where we do the work. So for example, in Basecamp where we all work, we’re not talking politics in Basecamp. If you wanna talk politics on Twitter, if you wanna talk politics in some private place, you can do that. But we’re not mixing work and politics. We made a few other decisions at the same time, but that was the primary one.

It it was met with a surprising amount of backlash. We were not surprised it would be controversial, but ultimately, about a third of the company quit in a matter of a week or two. We offered a very generous severance package. Some people were already on the fence, and so they took that, but most people left because they disagreed with the decision. I think the hardest thing was that there were some people here who’d been here for ten, twelve years who were really close with and who left, And it was hard to lose people who’ve been here for a long time.

It was hard to lose friends who this was sort of a line in the sand for them. So that was really personally difficult, and there was moments over the next six weeks or so where I was really down. I relied on my family a lot, a therapist. I needed some help to work through that because it was personally devastating. But it was still the decision, if I had to make it again today, would make the same decisions.

I think a couple things did happen. One thing is that we announced this publicly. So we’re a very open company in this way. We typically talk about everything we do publicly. But we announced this decision publicly, I think, an hour after we announced it internally. And I think what happened was is that there was a massive cascade of public pressure very quickly on employees before they even had a chance to really understand what was changing. Twitter specifically is mostly Twitter. There’s a mob mentality Yeah. And people were directly attacking individuals who were working here.

Like, how could you work for these x y z’s, you know, all the worst names in the world? At a certain point, there’s this massive pressure that’s mounting on people who they’re like, I didn’t sign up for this. What is going on here? Why couldn’t we have talked about this internally first? So I think we would have changed that. Not that the news wouldn’t have gotten out quickly, probably, anyway, but I think that we forced extreme pressure on people very quickly to make decisions. I think there’s some other things that the language that we used to make the announcement felt a bit punitive.

It felt like we were punishing versus just saying, we just can’t do this anymore. Here’s why. But it was a lot of no more, and I think that felt like like a punishment. People felt like we were coming down on them versus making a decision about the business. So there’s some details there. Bit of moral panic in some cases about making decisions we probably wouldn’t have made again. I can tell you the company’s in a significantly better place. We’ve actually grown significantly bigger than we’ve ever been, so we rehired a bunch of people and then have hired more since.

At the time that happened, we were about 60. Now we’re about 80, biggest we’ve ever been. We needed a kick in the face and a kick in the ass, basically, and that’s what that ended up being.

did hurt, and it still, from time to time, hurts when people say things about you that just are so extreme and so just completely unnecessary at the extremities. But one of the things I’ve just learned simply is that, and this took a while, I built up some thick skin prior to this. This sort of eroded some of it, and then you build it up again, is you just you cannot let other people tell you how to feel. And this is just a lifelong practice to figure out how to go, yeah, okay.

That’s a pretty strong opinion. I know me. I know who I am. I know what I believe. I know why I made these decisions, and they weren’t for those reasons. And you just have to go, okay. Part of this too is not paying attention, frankly. After this whole thing went down, I didn’t look at Twitter for four or five months, because Twitter is just really where all the vitriol and hatred, deep hatred was happening. I got tons and tons of emails from people who were supportive, but people didn’t want to say anything on Twitter because, you know how it goes, not many people are going to stand up to your defense when people are attacking.

I don’t understand the hatred, I understand that the passionate eruption from people who have disagreed with us. I get that. And that’s all fine. But at some point, you just got to realize you cannot let other people make you feel a certain way. Your reaction is the only thing you’re in control of. People can fling a bunch of things at you. How you react is the only thing that you can control. And that’s something I’ve just been practicing, practicing, and gotten much better at it.

When I make a decision, I typically don’t make it for now. I think about what will that probably feel like in a year. This is one way I do this, which is looking back on this decision. I try to project and imagine what it will feel like. Because there’s a lot of decisions that you make to make sort of short term pain go away or make conflict go away. And in the moment, it feels good to get that out the way, but then what are you stuck with?

What do have to live with? So I tend to think about what are we gonna live with on this decision? So this comes down to complexity and software. We could cut some corners right now and shortcut this just to get this thing done, but now we’ve got this shitty code in the code base. We’ve got this thing we’re gonna have to live with. We’re not gonna wanna go back in that area and mess with it, because it’s all messed up. In the end, it was not worth it, even though in the moment it felt like it was.

I also think, like, why are we even making this decision at all? You can find yourself making a lot of decisions that don’t need to be made. That’s something I’m always wondering about. Like, why are we even deciding on this? Or what if no one decides? What will happen? Will this just work its way out? Am I the right person to even make decisions? Who’s making this decision? That kind of stuff. What’s in the exams of do we even need to make a decision? This comes up all the time in software, which is gonna be a bit abstract, but let’s say you’re making a feature of some sort.

You’re worried about, should we have a button that does this or a confirmation that does that? Should we explain this way? Do we need a video to all this extra stuff that may not actually ultimately matter in the end, but there’s a lot of discussion about it, of consternation about it. Sometimes you’re like, you know what? What if we just don’t do this and see if anyone has any problems? Actually, here’s a good example of this. We have an email service called HEY, hey.com, and everyone who uses hey.com also gets a personal blog.

To post to the blog, you just email world@HEY.com, and whatever you write there goes on your personal blog, it’s published instantly. We had this big fear initially when we were launching this. Do we need to have content moderating, and do we need to approve posts? I wanna post someone posts something terrible, and and there was lots of discussion internally about it, different people had different comfort levels about how strict we should be, and should we not do it at all? And there was literally probably a month of discussion about this, a bunch of different people, and then David, my business partner, is like, why don’t we just not do anything and see what happens?

Are we manufacturing a problem? If we need to solve this problem, we can probably solve it. But why are we even worrying about it until it’s a problem? We ultimately went in that direction, and turns out, I think there’s been one, like, piece of content that was maybe questionable or something in two years or whatever it’s been.

Yeah. Let’s wait and see if this becomes a problem. Some things you can anticipate more than others, but other things you just don’t know. And I think a lot of companies spend a lot of time solving problems they don’t have. And then they solve them, they don’t have them, and they think they did good work because they don’t have the problem, but they wouldn’t have had the problem in the first place. It’s exciting to talk about decision making because we always think about big decisions, but you hardly ever make big decisions.

Most decisions are really small decisions. If you’re constantly making all these small decisions that didn’t need to make, that’s a lot of time and energy spent on things that you didn’t need to worry about. So we tend to say, let’s see if something’s going to be a problem before we actually solve it, and turns out we may not need

biggest recent ones was when we launched HEY, David was really adamant about launching the business version first, which is what was called heyfordomains. And I was pretty set on launching the personal version first, which is just hey.com. And we battled over this for a month, and it’s strong calls either way and whatnot. In the end, we decided to do the personal version first, which I think was ultimately the right call. But that was a pretty big one, and David’s point was that launching a personal email service that people pay a $100 a year for is a massive risk because people don’t pay for email.

Email is free. Businesses pay for email. Businesses are already used to paying for email. So why don’t we make something that they’re already used to paying for? And my angle was, I think we can make something good enough that people are willing to pay for. And so that was the battle. How do we resolve it? In the end, you make arguments, and then a decision is made one way or the other. And a lot of it has to do with who believes in it more, essentially.

Who really wants this more? And then we do what we call trade. Hey, look. Two friends going out for lunch. I got this one. You get the next one. Does it always end up equal? No. It doesn’t really matter, though. At some point, you work together for a long time. You really care about this one? Let’s go in your direction this time. There’ll be something I really care about. We’ll go in my direction that time. And we kinda do this over the long term, and and it tends to work out pretty well.

But one of the most important things about this is this idea of disagree and commit, that when a call is eventually made, and if you disagree with the decision, you cannot sabotage it. You’ve got to commit to it, because we still want what’s best for the business. And even if you don’t think it was the wrong call, you’ve gotta get behind it. And that’s the only way to make this stuff work. Otherwise, you have petty disagreements, sabotage, and that takes the whole place down.

Yeah. I think it’s a couple things. One, we do different things. So David’s an engineer. He’s more on the technical side. I’m on the design side. So we’re not battling over how to do the same thing. So I think that’s important, first of all. We see business about the same way. I’d say we have, like, an 85 to 90% overlap on our business point of view. So you need to have something core that’s shared and in common. The actual work itself, you need to have separate skills on.

I think that’s very important. Second, I think we have strong enough senses of ourselves that we’re able to battle hard and not take it personally. That’s something I think that’s important. I think also just fundamentally seeing, again, like business fundamentals in the same way is very important. Also, fact that we don’t see each other very often is very important. David lives in Denmark.

Yes. So we used to both live in Chicago for a while. Maybe once a week or every two weeks, we’d see each other. We don’t see each other very often. I think that’s helpful. We talk all the time in Basecamp. We’d have a weekly call. That’s enough, actually. And I think that’s a big part of it too. That we’re both able to make decisions independently, that we don’t rely on each other for everything, that we trust each other’s individual skills, and know that we’re not necessarily great at what the other person does, but that down the middle, we share 85 to 90% of the same.

Are you friends? Friends? Yeah. We’re friends. We don’t hang out as friends. We’ll occasionally grab a dinner or something, you know, with our families or whatever. Very rarely. We’re far away now, so that doesn’t happen at all. But when we were in the same city, we would occasionally do that. We wouldn’t just go hang out on the weekends or anything like that. It’s we’re not friendly in that way.

Yeah. I think we have a lot of shared interests, but very different lives. And I think that’s also very helpful.

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Thank you. We’ve been married for nine years. I think we’re doing pretty well. We have two kids. When we got married, my parents wrote this really little short letter to us, and there was a little bit of advice in the letter. It was give each other space is a primary fundamental thing. Compromise, but also give each other space. That, I think, is a really important thing. Now, not everyone’s that way. I think you have to know who you are. But if you’re someone who needs quiet time to recharge, or your wife is, or your spouse is, or whatever, you need to give them that, even if that’s not what you want.

Really understanding what the other person needs is incredibly important in a relationship. As humans, we’re very egocentric, and we’re always thinking about ourselves first, and relationship is really about an us, it’s not about you. It’s very challenging, though. I will say relationships in general are very hard, especially for like, I do like alone time. I do like my own space, and it’s hard, especially when you have kids. We have two young kids, eight and four. It’s very hard. The other thing I would say is it’s really important in relationships, and perhaps in business ones too, is positive surprise.

Doing things the other person wouldn’t expect you to do, that’s always a very special thing to do. So

I think things like deciding to take the kids for a weekend when she was having a tough time. Look, take some time for yourself. I got the kids. Things like that. That’s a hard thing to do. I got the kids for the weekend. She didn’t ask me to do that, but I could tell that she needed that. That’s the kind of thing that I’m talking about here.

to realize, there’s a couple of fundamental things about kids. We have two. So I’ve seen that how just completely different they are. Like I said earlier, management is the art of the individual. Parenting is as well. Our daughter needs different things than our son and vice versa. I think it’s very much paying attention to each individual and how they are, and not trying to have a blanket way of being. That’s something I think that’s very important. I think the other thing is follow their curiosity is something that’s really helped me discover new things.

Kids are incredibly curious, and there’s one thing that comes to mind right now, which is one of the fundamental things you learn when you have kids is that you cannot make people do things they don’t wanna do. I mean, you can really make a kid get in a car if they need to things, but you can see fundamentally that it’s incredibly hard, and there’s a lot of negative externalities when you try to force people to do anything they don’t want to do. I think that comes through in business.

It comes through in life. It comes through with your kids. But your kids really demonstrate that more than anyone else. And I think that’s just a good fundamental lesson to understand when you’re dealing with people.

recently relistened to Pink Floyd Dark Side of the Moon on some mushrooms. And that was a really extraordinary experience, actually. It was an interesting reminder that the thing that you think you can experience in a different way. And that was just an example of that, but I’ve taken that experience and thought about that in terms of pretty much everything that you get very used to, like, the one note of something that you really know, It turns out that there’s a lot of notes and a lot of angles on things that you think inside and out.

That was something that was a quite an interesting experience.

You could go to Jamaica and do it. Wonderful. It’s illegal here. It’s legal in some places and illegal in others. What advice do you want? How often do you do them? How does it make you feel? Not very often. I’ve done a high dose twice, and then a low dose twice. High dose meaning five grams, like, give a blindfold on, and it’s a completely inner experience for about six hours. It’s a complete journey trip, which is absolutely profound. I came away from those experiences a different person, and also a feel like everybody should do this once in their life, is how I felt after I came away from those experiences.

But I’ve done some low doses and just listened to music, real low doses, just listened to music and just kind of relax, and what’s really interesting is that you recognize that, again, there’s a lot more nuance to things than you typically would imagine, and that our waking brain right now, if we’re both not on anything, is really a filter. You’re filtering the world into a way that you can perceive it on a day to day basis and live normally. But this is not necessarily the way things actually are.

There’s more to these things, but we downsample everything so we can manage. And so it’s interesting when you take mushrooms, it upsamples in a sense. It removes the downsampling, you get to see a little bit more about what’s out there, which is really pretty interesting.

The narrative, although I think it’s actually changing a bit right now, which is you need a whole bunch of money. You need to grow as big as you can. It’s all about scale, all that stuff. I’ve been saying this for twenty years, so it feels a little bit boring to say again, but and the truth is that actually most companies are self funded, are bootstrapped, are small. That’s actually the truth, but it sounds like that’s not the case, because there’s so many big companies or startups that get all the news, and they raise a big round, and that’s what a lot of people think they must do, and they come out of school thinking that’s the way to do it.

So I just wish that narrative was different.

Yeah. We did something not a secondary, but we did something similar with Bezos back in 2006. So Jeff Bezos bought a small piece of my shares and David’s shares. None of his money went into the business. The money went into my bank account and David’s bank account, and this is to take some risk off the table. We didn’t know back then that Basecamp was two years in. We didn’t know if this thing was going to last. It was doing well, but gosh, what if this falls apart?

Who knows? And I’m not a fan of putting everything back into the business. I don’t think that’s the way to run a business. I think you should take some money off the table as you go. You took a tremendous amount of risk to start this thing. You invested a lot of time and energy, and you could have done a million different things, but you did this. I think it’s very healthy and very smart to take some money off the table. How would you describe your attitude to risk today?

I’m very comfortable taking risks. I’m actually more comfortable taking risks now, but I’m not comfortable risking the business. So there’s this idea of risk, and then putting the company at risk. I’m not interested in putting the company at risk, but I’m interested in taking a whole bunch of risks and trying a whole bunch of things. I think this comes from David and I talked about this actually when we made that decision about the no politics thing. We said, you know what? It could happen that this sinks the business.

We thought it be controversial. We didn’t know how much, but it could sink the business. We looked at it, we go, you know what? If that is the case, that would actually be okay. It would suck. People would lose their jobs. That would all be bad. I’m certain people who worked here could get other jobs. We’d help people get jobs. It would suck for everybody. But it would also be okay in that we had a, at that point, a twenty one year run, a wonderful business.

We made a lot of impact in the industry. We took care of lots and lots of customers. We generated lots of revenues, lots of profit, all the things. We’ve put out books. We’ve done all the things. If it came to an end at that point, it would be okay. That’s something I always think about, and that gives me a lot of confidence and solace in taking more risk and being risky. And in fact, I was actually talking to Brian over at Coinbase about this. He had a great thing.

This wasn’t about the politics thing, but we were talking about something else. He said, basically, the founder’s job is to inject risk into the business. Because professional CEOs, or when founders leave a business, businesses get very conservative. They don’t take risks anymore. It’s actually the founder’s job to keep adding risk to the business. And I’ve come to really believe that’s the case, because I can see that if I’m not pushing weird ideas or trying different things, those things wouldn’t naturally be happening inside the organization. People aren’t built to take more risk in their jobs.

It’s not really what’s rewarded ultimately in companies, unless it pays off, but risks typically don’t. People tend to be more conservative, so it’s my job to not be that.

I don’t know the person, but I’ll describe who I’d like them to be. I would love to have someone with a radically different perspective that is convincing. I would like someone to be able to make a pitch and a case we never would have made, a perspective we never would have had, something we never would have seen, and come away believing that that’s a really viable alternative. That kind of person. I don’t want another person like us. I don’t want someone who’s gonna just encourage us to do what we wanna do.

I’d really want someone who I listen to and I go, oh, shit. I hadn’t thought of that. That is interesting. I like insights like that. For me, insights are the most interesting things in the world, actually. When you have or you hear something you haven’t heard before, or you haven’t thought before, or you thought you knew everything about something and you hear it from a different point of view, that stuff quenches me, and I would love to have someone around who was like, David and I even though David and I have a different point of view on some things, for the most part, we typically agree.

And it’d be interesting to have someone who would really push us in a different direction who we would really respect and be surprised by.

have some, they’re coming in, more gray. Are you still at Basecamp? Ten years from now? No. I think I’m certain I’m not here in ten years, but I don’t know where I will be. What I do know is this. I have no interest in ever starting another business. And what I would say is, I might start actually, I should say this. I have no interest in starting another company. I could see myself starting another business, and by that, I mean just me. So I might do something that only I could do alone, consulting.

I don’t know what it would be. Right? Because you need those dollars, those consulting dollars, James. No. It’s not even that. I like the creative process. I like to help people do that, but I don’t think I I’m certain, actually, not don’t think. I would never start another company with employees. What I don’t want to feel anymore is responsible for anybody else. I’m responsible for my family, my kids, like, those things I’m responsible for in that world. That’s enough responsibility for me. When I’m done with this, I’ve carried this responsibility of dozens and dozens of people, and decisions, and business, and all that stuff.

I don’t want more responsibility when I’m done with this. Whatever I can do that doesn’t feel like