Afford Anything - How I Bootstrapped a $4 Million Company, with Laura Roeder

Episode Date: May 29, 2017

#79: When Laura Roeder was 22, she quit her job to become a full-time freelancer. She earned $30,000 in her first year as a freelancer; $60,000 in her second year. Ten years later -- (Laura is now 32) -- her company earns $4 million in annual revenue. (Can I repeat that? Did I bury the lede? *Laura went from making $30,000 per year to owning 100% of a company that earns $4 million per year.* And she did this within a decade. Oh, and she also had a baby.) (Like, whoa.) Laura is the founder and CEO of a software company called Edgar, which provides social media automation for entrepreneurs and small businesses. In this interview, I ask Laura (sophisticated) questions such as "How the f**k did you make the leap from freelancer to multi-million-dollar company owner?" Here are some of the insights that she shares: #1: You have nothing to lose. When Laura quit her job, she conquered her fears by reminding herself: "Hey, worst-case-scenario, I work an hourly retail job for awhile if I can't find any clients." Sure, that might suck. But is the worst-case-scenario *so bad* that it's a deal-breaker? When Laura realized that the worst-case-scenario was something that she could live with, she proceeded full-speed ahead. #2: Cut the cord. When Laura transitioned from freelancing to consulting (her intermediate step before starting Edgar), she knew that if she maintained her client base, she wouldn't be motivated to grow her consulting business. So she cut the cord. She dropped all of her clients, including one extremely lucrative contract, in order to motivate herself. #3: Look for what's next. Laura's transition follows a sensible narrative arc: employee, freelancer, consultant, software company founder. Each step led to the next opportunity. Freelancing turned into consulting, which turned into a kernel of an idea for a software  company. She couldn't have predicted, at age 22, where she'd be in 10 years. She simply proceeded one step at a time. ____ Listen to Laura describe her story -- and share advice for people who want to start companies and/or work remotely -- in today's episode. Learn more about your ad choices. Visit podcastchoices.com/adchoices

You can afford anything but not everything. Every decision that you make, every dollar you spend, every hour you spend, every ounce of energy you spend comes at the expense of something else. So every dollar that you pay for avocado toast, you are trading that for not having to spend the time and energy to think about the small stuff. So you can decide for yourself whether or not that's a good tradeoff. I say it's a great tradeoff because your time and energy are worth something. Welcome to the Personal Finance podcast that does not tell you to ignore $10 bills while you pick up pennies. Did I just say $10 bills? Screw $10 bills.

You're going to be picking up hundreds. Thousands. Hundreds of thousands? Thousands of hundreds. I don't even know where I'm going with this. I've clearly gone loopy, so let's just get to today's guest. Her name is Laura Roder, and she, oh, speaking of people who go after the big bucks, she's a CEO and founder of a company that earns $4 million in annual revenue.

And before you start thinking, well, that's great, but how does she relate to my life? Here's her backstory. When Laura was 22 years old, she quit her one and only full-time W-2 employee job. I guess technically she's employed by her own company now, but you know what I mean. She quit her job at the age of 22. At the time, she was making $30,000 a year. She went into freelancing, then she went into consulting, and then from consulting, she started a software company. I wanted to talk to her because, number one, I love that career trajectory that she went through.

It's relatable. If she had just quit her job and launched a software company that ran into a $4 billion revenue, I don't know if I would have been able to connect with that as much. But quitting your job to become a full-time freelancer? Yeah, I can imagine that. I can understand that. Becoming a full-time freelancer and then kind of up-leveling into being a consultant. Yeah, cool.

Yeah. That makes sense to me. me too because you're still self-employed. Maybe you're adding a couple of people to your team. You make one hire or two hires. But overall, it's still a very small business. That all makes sense to me. So this path that she went through is very easy to relate to, in my opinion, very easy to follow. And we're going to talk to her about how she then up-leveled to the next stage, which is running a company that does $4 million in annual revenue. I've repeated that like three times in this intro. So I'm going to stop talking now before I repeat even more. and let's hear from Laura.

Hey, Laura. Hi, Paula. I'm really excited to talk to you. Let's dive right in because you've got a fascinating story. I want to start by asking you about the time that you were 22 and you quit your job. Yeah, so when I was 22, I quit my first and last job out of college. I was a junior designer at an ad agency, and I was definitely interested in the time freedom, that I could get from freelancing. I was also interested in doing more than just design. You know,

I liked being a designer, a designer. I didn't love being a designer. And I was actually interested in learning more about how to get clients and how to do proposals and the business side. I think a lot of the stuff that a lot of freelancers dread, I was actually pretty excited about pursuing. As a 22-year-old, were you terrified, like in terms of what if you didn't find clients? What if you didn't find a job again? All of those fears and doubts that go through people's minds when they quit, particularly at such a young age when you didn't have a lot of career experience behind you. Yeah, I definitely had all those fears and doubts. And, you know, it didn't take me a really long time to find the job that I had. But I just thought, okay, what's the worst case scenario here? Because I don't like. my job. And I was, I was also pretty unhappy specifically at the company. I was at either way, I would have switched to another job. So it's like, okay, well, I don't like my job. So if I completely fail freelancing, I mean, money-wise, I can like move back home and move in with my parents

if I have to. And career rise, well, I'll just find another job I don't like. I mean, it's like I'm already kind of starting from a place that I don't want to be. I think, you know, worst case scenario, maybe you have to get a retail job for a while or something, you know, that's maybe not in your professional field while you look for something in your professional field. But especially when you're young, you know, it's funny because people act like it's risky when you're young. But like, you know, now I have a family. I didn't have kids then. I didn't have, I didn't have anyone to support, but just being able to feed myself and have somewhere to live. So it was a pretty low income that I needed to make.

Did you have any savings at that time when you quit or any freelance clients lined up? I did have some savings. I was always a really diligent saver even though I wasn't making much money in my job. So I did line up a little bit of savings before, not like six months living expenses or anywhere near that. And I did not have any clients, which is not what my advice would be. I mean, I think the more common path is to start freelancing on the side and then kind of build it up. But I did not do that. I didn't do it on the side. I didn't do it at all until I quit my job.

So when I quit, I needed to find my first freelance client. So you had a fire under your butt, basically. Definitely. I mean, you know, I don't have, you know, family money. Like, I needed to make money in order to pay my living expenses. How was your first year of freelancing? I made my financial goals, my first year. My big goal was to make as much money.

freelancing as I did from my job. So at my job, I was making around 30,000 a year. And I did make 30,000 in that first year, which was like, oh, I can do it. You know, I can support myself on my own as as much as I did from the job. So that was really cool. Nice. Eventually, you transitioned and freelancing led to consulting, which eventually led to starting a software company. How did that progression happen? So as I was freelancing, so I hit that 30,000. And then I thought, okay, I want to double my income. And I did. My second year, I made 60,000.

So after I hit 60,000, I thought, okay, I want that six figures. You know, I know this is such a big goal for so many entrepreneurs. And it was for me. Like, I want to hit six figures. I started doing the math of how I could make six figures, how I could double my income again. And the math was not working out because I could not take on double my client load. I was already at capacity. you know, it didn't look like I'd be able to double my fees because my fees were already

pretty high and obviously I was pretty new and inexperienced at this time. And I saw that if I wanted to have a six-figure business, the best path I could see from what I was doing was building an agency. I knew from the agencies, you know, that I had worked at and seeing a lot of friends in agency jobs, that it was a really tough business model to make work because you're always hustling on one hand to find clients and then to find people. to fulfill the work and trying to keep those even. And I just really didn't want to build an agency. So I decided I'm going to quit freelancing. I'm going to find a better business model.

And consulting just came really naturally because my web design clients would ask me about social media as it started to become a thing that people were interested in. They would ask me about it. I would tell them, you know, how to do it for marketing, how to set up their accounts. And people kept telling me, we would pay you just for this hour that you just gave us for free. you know, we would pay you just to explain Twitter to us. And I thought that sounded like the easiest job of all time getting very to talk to people about Twitter. So that's how I moved into consulting, just looking for kind of something new. And then that quickly led me to the world of training and information products. And that's where I really found a business model that could,

you know, hit that six figure goal and could really scale. Basically from the consulting, I took one of the the principles that I was teaching and consulting and made it into a software product, which is Me, Dutker. Right. How did that happen? So you had, I think, what a spreadsheet that you advised people to fill out and then you turned that spreadsheet into a piece of software? Yeah.

So what I found in my social media advice and teaching practice is that what people were doing and what, unfortunately, most people still are doing, is creating original status updates multiple times a day, every day, for the rest of time. is how, you know, it's how most people handle social. And for a solopreneur, for a small business owner, it's just incredibly time consuming. And I started looking into this thinking like, okay, I'm making all these new status updates. How many people are actually seeing these status updates? And of course, this later became a big brouhaha over Facebook, the whole Facebook reach thing when Facebook started publishing and showing you, yeah, actually, you know, 20% or 10% or

5% or less of the people that like your page are actually seeing your status updates. So I kind of put two and two together and I'm like, well, instead of having new ones forever, why not just have a library of evergreen updates that you just keep repeating, you know, because only 5% of your audience is seeing an update, you should send it out again. 95% of people haven't seen it or if they have, they don't remember. So I was using and I was teaching people, create a spreadsheet, put all the different types of updates as different categories, different columns, like inspirational quotes and links back to my site and links to other people's content and then cycle through. But, you know, before Edgar existed,

you had to just copy and paste from the spreadsheet to the social media tool. It was still a lot of tedious work. And I thought it would be a lot easier for software that just did it for you. So that's what Meet Edgar does. And did you have a background in coding or programming? I mean, how were you able to enter into the world of software? I am not a program. You know, I used to make websites, but my limited knowledge stopped at like the year 2008, basically. I never took that to the next level. And I don't know how to code software. So I had been interested in having a software company, in particular, a SaaS software as a service, which is subscription software.

I was really interested in that business model. But yeah, I was kind of like, I'm not a developer. I don't really know how that'll come about. and how it happened is I met my husband, Chris, and he is a developer. Really how it happened is I was just kind of complaining to him about how tedious it was, copying and pasting these updates and you couldn't have images. And I was just kind of saying, why don't the tools do this? It seems so odd that the tools don't do this.

It seems so obvious. This is what I'm doing. This is what my clients are doing. And he just said, well, I can make a tool that does that. And I said, great, make it. And that he made Edgar. So at what point did you decide then to fire all of your consulting clients and go full into the SaaS company? Yeah.

So I had kind of two transitions. And one was a very like clean transition and the other was more overlap. So when I stopped doing web design, that's actually the point when I 100% fired all of my design clients. I just knew that I wanted to get out of doing design, and I knew that it would be a crutch for me if I kept taking on that work and I wouldn't be able to move into that new business model that I wanted to. I actually had one client when I stopped that was paying me $30,000 a year just from that one client. So, you know, as much as I used to make for my old job. And I knew that they were the most important ones to cut out because I just knew it would be too easy to not really have that fire under me, you know, to just sort of keep. depending on that income. And they were not happy. I'm not happy with me either. And I knew that I had to be

really firm because I knew they relied on me and that they would keep trying to come back and get more work out of me. So at that point, I actually did a completely clean break. And I was like, I'm not going to do any design work. I'm just going to do the social media consulting stuff. And I actually didn't do that much consulting over the years. It was much more that that productized training model. And then when we launched Edgar in 2014, we didn't kill one business and start the other. So basically we used the money. We used the profits from the training business to fund Edgar.

And we kept the training business going for about a year after we launched Edgar to, you know, continue to bring in that money and continue to fund it. And I wasn't thinking when I launched Edgar, oh, I'm going to kill the training business. I thought I would run them both and that they would be complementary, you know, teaching people on the one hand to do it. And then if you want software to do it, this is the software that will do it for. you. But honestly, the software business model, I just loved so much more. It was such a scalable business. You know, the training business, it was, I was the face of it. I would create all the

content. You know, I was the trainer. So it was a business that was very, very reliant on me. And I didn't really love that. So basically, once Meet Edgar really took off and really started making money, I just decided, you know, I just want to focus on the software business. And we did shut down the training business. Now, one of the things I find fascinating about your story of launching Beat Edgar is that you self-funded this business. And that's not a story that I hear often in the world of software startups. Right. What made you decide to do that?

So that really was a big decision because I knew that, you know, I did have the type of business that could raise money. I also happened to actually have a lot of connections in Silicon Valley with entrepreneurs and investors and stuff. So I knew I could have done it. But, you know, I was lucky enough to have a lot of friends that have raised. And literally 100% of them gave me the advice. I would not raise if I didn't have to. If you have any way to make this work without raising money, then do that. And I think a big reason for me of following that advice and a reason they gave the advice was having the freedom.

So when you've raised money, you know, you have other people that own either the minority, or sometimes a majority of your company. And you have a legal fiduciary duty to do what's in their best interest. And of course, sometimes they have control over the decisions in the business. As someone who'd always owned 100% of the business, realizing that when you have investors in your business, you can't just take the profits out for yourself. Like that's a group decision, what to do with the profits.

You can't just say, oh, I feel like taking an extra 50K out of the business this month, because I want to remodel my bathroom. You know, when you own 100% of the business, which I do, I can take out 50K to remodel my bathroom. And that's the kind of freedom that I'm looking for as a business owner. It's also a lot of pressure when you raise money. You know, the current climate for raising money for software companies is you're raising money so that you can sell the company for a tremendous exit for your investors. So it's not just, oh, I want to get to a $5 million or $10.

million dollar business. It's like, I want to get to a hundred million dollar business and I need to get there in, you know, three years. It's like very, very stressful, the kind of pressure you're put under. And I did not want that pressure. Feel free to tell me to buzz off, but I have to ask, how much money did it take to seed this company, to self-fund this company? No, I think that's a really good question. So we didn't keep track of it as precisely as we should have, honestly, but it was about 200,000. And that was about over a year that we basically took profits from one company to put them into Edgar until Edgar was totally, you know, making money and

paying for itself. And what did most of that go towards? Was that salaries? A hundred percent. Yeah. I mean, so for software, the infrastructure costs are are really tiny. I mean, to this day, just tremendous amount of our expenses are for salaries. So, yeah, salaries in particular hiring developers. Developers make six-figured salaries. So it's, you know, an expensive person to add to your team. So not only developers, but people to do marketing, to promote the software, budgets for ads to let people know about the software, and budget for customer support people to make sure people are successful. Right. What were some of the first roles that you hired for? So we did have a little company in the training business that, like,

transitioned over in the beginning. So when we started, Edgar, we had a full-time project manager. We had a full-time, like, marketing writer. And I think just a part-time customer service person, or maybe like two part-time customer service people that had been, you know, working on the training business. So those people plus a programmer were like that initial core team for Edgar. And your team now is, what, 13 people, 15, 15? somewhere around there? 30. What?

Whoa. My information is very outdated. Well, we've grown pretty fast. You're not actually not behind. Wow. Well, congratulations. Yeah. Yeah.

So, yeah, we've grown pretty quickly. Wow. And you only started in 2014, so that's incredibly fast growth. I've got to ask, what are your annual revenues? So we're at four million annual now. Nice. Congratulations. Thank you.

Now, I've heard, I don't know if this is still true, but I've binged listen to several podcasts that you were on in preparation for this interview. And some of the ones that I listened to, you mentioned that you work part-time. Is that still the case? It's not the case anymore. So, yeah, another, like, part of the story that we haven't touched on is I was pregnant when we launched the company. So my son was born about six months after we launched. And I took a three-month maternity leave. And then I worked the next year part-time. So I am. back to a full-time schedule now, although it's like a very, it's like a very relaxed part-time. Like I usually end up four. I usually have like a two-hour break in the middle of the day where I go

lunch with my family. So I don't know. I'm maybe at like 30 hours a week or so. I think that's incredible that you work, you're not working the grueling 60-hour weeks. You know, you worked 20 to 30-hour weeks building a $4 million company in two and a half years, I guess that's not a question other than how? Well, I mean, the how is the 30 people, right? You know, because of course, the way you phrase it is like you built a $4 million company, which is obviously, you know, not not the whole picture at all. You know, I'm a very small part of building this company. And I think, you know, often when people are starting out, this is one of the biggest hurdles they have is hiring people and

building the team. It's really scary for people, you know, I think for a lot of reasons. Letting go of that control is definitely a big one. And something that I think about all the time is like there are a lot of things that need to be done to make a business succeed. And as the business grows, there are even more things. And if you want to make the business larger, there are even more things. And humans need to do hours of work. And somebody's got to do it. Like it can be you or it can be somebody else, but somebody's got to do it. And when you add people to the team, you get more hours. Like you are only, you only have your 24 hours.

But when you add somebody else, you get theirs. And then you add somebody else. And I mean, not all 24, of course, but, you know, during the day. And so if you want to accomplish more things in your business, you know, adding more people is the most effective way to do that. So for me, as I wanted to grow the business, I mean, I actually think, It was a huge blessing to have launched a business pregnant because I knew I wanted to take maternity leave. And, you know, I talked to a lot of moms that owned businesses and they all gave me the advice. Tell your team, it'll be more.

You can always come back earlier, but you don't want to tell your team, oh, yeah, I'll be back in two weeks. And then it turns out, you know, you need to take longer. You want to take longer. So I decided I would be fully off for three months than I was. And so knowing that, you know, I was pregnant. I knew the baby was coming. knew it was going to happen. And knowing that from the beginning really forced to me from day one to build the company,

build the team in a way where the business was not going to stall out where I was gone. Because that's kind of what I had done before in the training business. I built a business where I'm like, I can be away and the business can kind of coast without me. And it's not going to shut down. But it couldn't really grow without me. So I was really determined when I started meet Edgar that I really wanted to build a business that could really not just like host while I was gone, but really keep growing while I was away. How do you do that? How do you keep yourself from being the bottleneck?

Well, I mean, so yeah, being the bottleneck is like a really brilliant way to put it. And that's kind of exactly how I look at it. You know, look at the things that I'm doing during my day, where am I bottlenecking processes? Where are my bottlenecking decisions being made? So at this point in my business, you know, nothing is going through me on a day-to-day basis. Like, I'm helping to guide the larger strategic plans. I'm talking to our team leaders about what their big plans and what their big goals are for the quarter. But like there's nothing that I need to approve on a on a day-to-day basis to make happen. So that means that other people can make decisions, right?

It's empowering the people on your team to not just like do the work that you tell them. I think, you know, when you start out and you're hiring your first part-time assistant or whatever, you often operate in this way where you're like, okay, I have a task for you. to do it, then I'm going to review it, and I'm going to give you like the yes or no. And, you know, that's how you start. But then if you really want people to be able to grow the company beyond you, you have to move to that next level where it's not like you're going to do something that I'm going to tell you yes or no. But now, you know, our head of customer service, she's making the policy decisions. She's not like, Laura, can I give this people, this person a refund, you know? And not

only is she not asking me about each refund, like she's deciding the policy of who gets a refund and win and what we're going to say to them. She's making all those decisions on her own. How do you ensure that the decisions that your team is making is in line with your vision and direction for the company? So I think one, you know, you have to remember that they're not going to make every specific decision the same way you would make. And that, I think, is a huge key in unlocking like both growth for your company and just

mental freedom and relief for yourself because you will always be disappointed if you expect other humans to like make the same call as you every time because you're you and you're unique and you have your own background and point of view. So it's not about, you know, expecting people to always go about things the same way that you would. It's about exactly what you said, being aligned on the larger vision. And I know a few ways that we do that at our company. We do have our core values at our company. We have our what we call a painted picture, which is our three-year vision of where we want to be. And then we break that into our quarterly, what we call big rocks.

So each team has the three big rocks that are the most important things to that team is going to achieve that quarter. So, you know, I'm talking to people about what those big rocks are, how those big rocks fit, with where we want to go big picture. So that ensures, yeah, that people are making their own decisions, but everyone's kind of pointed in the same direction going the same place. Has there ever been a time, or can you give an example of a time when someone has made a decision, whether large or small, that you didn't like and how you dealt with that? Well, yeah. I mean, so I've recently been talking to, you know, I mentioned our head of customer support.

Her name's Christina. So she and I have been talking a lot about live chat and how we offer live chat because we use intercom for our customer. support and the CS team really wants to have everything in one place so they can have all, you know, the customer history and data and stuff. I really like having true live chat, meaning it looks like a live chat screen. The person knows that it's live chat and the person is available. Intercom doesn't offer that exactly. Like it offers something sort of like live chat, but it can also be asynchronous and whatever. So I don't like, I don't like the solution that we have. No, I like it okay.

I understand that it achieves the goal of talking to people quickly. If I were in charge of customer service, I would have, like, what I call true live chat. But Christina's solution is, like, she has more perspective on what's actually more effective. You know what I mean? Because she's running the customer service team day to day. And so she made the call that all the data that we have at our fingertips actually allows us to give better service, like, using this solution, rather than having a separate live chat tool where we're, we'd have to go back and forth to get the customer data and the account and all that stuff. So there are totally things where I might do it different if I were in charge of customer service,

but that's not a make-it-or-break-a-de decision. Like, the way that our live chat looks is not what is going to, you know, kill or elevate the company. But those things like having great service and having a great response time, those are really important. So, you know, Christina's making the decision based on, like, what is best going to achieve that goal. That is an excellent point that there are a few things that truly matter and the rest are. How do you decide what those are? And are there any particular metrics that you either track or have chosen, deliberately chosen not to track? Well, yeah.

I mean, so for us, our most important metric is what's called MRR, monthly reoccurring revenue. You know, we're a subscription business. We're reoccurring revenue. So that's the number that we're always trying to grow. I mean, we're not an incredibly matrix-driven company in the sense that we don't have, like, weekly numbers that we have to hit. We're more believers in do what you think is the best strategy. And then the numbers will follow.

And it can be a little pointless to try to predict exactly what the numbers will be. Like, for a company like ours, we're always trying to get our churn down. And churn is the number of people to leave every month. So it's really important, you know, to make more people stay. But to me, it's a little arbitrary to say, like, okay, our turn has to be 3%. Because we can't control that outcome. You know, we can't control directly whether it's like two and a half or three or three and a half. But we can say, hey, we think that if we have a better onboarding sequence, that's going to

positively affect our turn. So let's create a new onboarding sequence and then let's see what happens. Maybe we'll be correct and it'll help or maybe it'll make things worse or maybe it won't move the needle at all. But I think that's more helpful saying, okay, let's do this and let's see what happens rather than, okay, guys, like we have to hit 3% churn. Because that doesn't really tell you what to do on the day to day. So we're more focused on let's enact what we think are the best strategies. And then let's see what happens.

Hopefully it'll be able to get us closer to those numbers. Does your email stress you the F out? Okay, so I've got three email accounts, two business and one personal. When I log in, I see this disdemeanor. organized jumbled mass of everything, from unsolicited press releases to cold pitches to listener questions, it goes on and on. The actual important emails that I need to get to end up getting lost or buried under the weight of all the clutter of my inbox. This is a daily struggle. I just have a bunch of email, and it stresses me out. Sometimes, like, especially after I go on a trip, like when I

haven't been checking my email regularly, even if I've just been away for a long weekend, like a two or three day holiday weekend. I'll come back to a hundred unread messages. That sucks. That's a sucky way to come back from a vacation. And there's a part of me that wants to just hit the nuclear option and delete all. But there's important stuff in there. Like there's emails that I actually need to read and reply to. And they just end up getting jumbled into this like disorganized heap that is my inbox. And so, anyway, TLDR, I recently began using a service called SaneBox that basically they just make sense of your inbox. Their algorithms separate actual important emails from noise so that you can tend to the emails that are most important first. They also will automatically

track emails that you've sent to other people that are still pending response. So that way, you know to follow up. You don't have to set yourself a follow-up or mind. In the show notes for this episode, I'm going to post a screenshot of the way that they've brought relief to my email so that you can see what it looks like in my own email. They cost only seven bucks a month for their basic plan, and they're offering both a free trial and an additional $25 credit to anyone who signs up at sanebox.com slash Paula. So again, you've got to go to that URL if you want the $25 of free credit plus the free trial. sanebox.com slash Paula, P-A-U-L-A. I also want to give a shout out to Bluehost. If you're interested in starting your own blog, check out Bluehost.

They're a company that offers hosting, which is basically the term for the space on the internet where your blog lives. Absolutely fantastic if you are getting started as a blogger and you need hosting and a domain name. You can learn how to set up a Blue Host account in five minutes or less. by visiting afford anything.com slash start a blog where I've got a full set of detailed instructions, step-by-step guide, including screenshots of every step along the way, plus a YouTube video. Check that out, afford anything.com slash start a blog. Your team works remotely, correct?

Yes, so we don't have any central office at all. Everyone works from their own home or co-working space or Starbucks or whatever. Have you found it challenging to manage a remote team as opposed to an in-person team? There are definitely some challenges. Remote is all I've ever known. I've never, like, had a company in person. So, you know, I don't have the full context of what's different. The worst thing about remote is just that you lose out, obviously, on a lot of social connection.

And we meet in person twice a year. And obviously, we chat, you know, we have casual conversations on Slack or sometimes in video chats, but it's very different than that. In an office, you're having those social conversations every single day, you know, and you're also getting a better mix in an office. What's weird for us being remote is we have some people whose jobs never cross paths. You know, if you are like a marketing designer, you probably have no opportunity to interact with like someone who does QA on our software, who does testing on our software. You're just, your jobs don't go together. So a 30 person company in person,

And those people would still have coffee. They might have lunch sometimes. But for us, like, they don't get opportunities to talk unless we're at one of our retreats in person. So to me, that's the biggest downside is keeping up that camaraderie and that connection between people. You really have to try to make that happen. The biggest upside is that we can hire all over America, which is incredible.

And people can have life changes and not lose their jobs. And I didn't anticipate how much that would happen. We've had so many people move cross-country. because their spouse got a job or because they wanted to be near family or away from family or whatever. And I hate to think that because someone's spouse got their dream job, that person would have to leave our company. So that's actually a huge benefit as well. That's really interesting. So it helps retention in that way. It helps retention hugely. And we've had amazing retention at our company.

How do you make hiring decisions? So that, I mean, that's a process that we've really focused on evolving over the years because we're a knowledge worker company. Our employees are our product basically, right? The product is a direct result of the employees. We don't have like a manufacturing process. It's people writing code, like talented people writing code, creating the software. So we do look specifically for people who will thrive in a remote environment, which is definitely not everyone. We were actually kind of joking about it. We were on a call today talking about getting people to speak up more meetings and it's like, yeah, we hired a bunch of people that want to sit alone all day.

You know, like they're often pretty introverted people that maybe, you know, I need a little extra encouragement to speak up. And we'll see that at our company retreats, something that we do is we bake in like alone time after we have our workday before the evening activity. We've learned to bake in at least an hour or so where people can go back to their rooms and decompress and, you know, be alone. And a lot of people have told us that they really appreciate that little break. So, yeah, they don't have to be introvert or extrovert, but they do have to be someone who is really great at focusing their own time and can really thrive in that environment of really being autonomous. It is a lot less collaborative.

I mean, we work somewhat collaboratively. We have meetings and we're on Slack, but it's not like a normal office where you're sitting next to someone, maybe trading ideas all day. So we specifically look for people who want to do that and can do really well in that type of work. A lot of the people who are listening to this podcast are either interested in being an entrepreneur of some sort, whether it's freelancer, consultant or starting their own scalable software company. There are a lot of people who are listening who are interested in that. And there are others who are interested in working remotely for a company. So I want to ask your advice to both groups. And let's start with people who want to work for a remote company.

you've described your hiring process or some of the things you look for. How does a person, an applicant, signal that they would thrive in a remote working environment? How do they signal that they have the focus and the autonomy and the drive? Yeah. So one of our company core values is what we call value for value. And that's this idea that everything is an even exchange of value. And one of the most important ways that we exchange value is from the company and the employee. So the company provides you with a paycheck, with benefits.

and an environment where you can do great work that you really enjoy. And then the employee in exchange gives their time and talent and ideas to the company. Something that I see people do a lot on remote job applications, you know, I've reviewed thousands of them. They often talk about how they want to work remotely as opposed to the value that they're going to bring to the company. So people will say things like, I want this job because like my daughter is disabled and I really need a remote environment.

And I'm like, well, that's not about your value for the company. You know, that's that's about your own life and why you're looking for this. And like, cool, whatever your motives are. But you haven't told me anything about the value that you're going to provide for us. So focusing on, you know, not your like life circumstances of why you want to work remote, but more about how you know that you are really good at working independently and then give us specific scenarios. You know, I've done freelance work for companies and I was working on my own and the computer and I never met up with them in person or maybe you've had a remote or like telecommuting job before.

So, yeah, focusing on these are specific ways that I have been able to provide value when I was not sitting there face to face with my team. Interesting. What about for the other group of listeners, the people who want to become freelancers, consultants, company owners? Yeah, and the biggest, you know, obviously there's a lot to say. Yeah, that's too broad of a question, I suppose. Yeah, I mean, I think the biggest thing is just to get started because you, you know, Paula, as I know you know, as anyone knows who's done it, you just learned so much in the day to day of being in the trenches that you just cannot understand before you've done it. You know, you can read books and you can read blog posts all day. And it's great to get that knowledge and get yourself educated.

But like you learn really quickly once you are really doing. doing work and exchange for money. I mean, I love freelancing. I love consulting because you can get started today. You know, you just need to find one person that will give you money. You get paid quickly. You provide the service quickly. It just really allows you to have that iterative feedback loop of improving your business processes, you know, improving the success you get for clients. So I think that's such a great place to start. Any skill that maybe a lot of people have skills that they've done at a full-time job that they could translate to freelance work. And that it's just a really easy place to get started.

Transitioning a little bit, one of the reasons, Laura, that I was excited to talk to you is because frankly, I don't know many women who are founders and CEOs of SaaS companies. What has that experience been like for you? Yeah, there's not that many of us. You know, it's been interesting for me because I've really been able to keep myself in such a bubble very deliberately. So I haven't raised money, which I know is where women can encounter an incredible amount of sexism. I just decided not to do that. I also get to choose who I hire, right?

So, you know, sometimes people will ask me, I'm 32, so people will say like, oh, have you dealt with people, you know, who are older, maybe not respecting you. And like, well, obviously I wouldn't hire someone who thought that way, you know, like they wouldn't. if they don't want to work for someone who's 32, like, that's what this company is. So they're not going to get that far in the interview process. I did publish a post on Medium telling the story of when we had an interview candidate. When he was talking to men, he did not reveal this part of himself at all. But then when he was talking to some women at the company, he really talked down to them and was really belittling.

That was a really big wake-up call because, like, I don't have to deal with those people. in my day to day. And it's just the nature of our business, too. We don't have big clients that we're pleasing. We have thousands of small business clients. I'm not having to go like wine and dine clients and vendors and stuff. So on the one hand, I think I've been a little bit naive in some of these stories. On the other hand, I think it's sort of an interesting example of how you can kind of create your own world and kind of create the kind of environment that that you want. What is the future of software automation?

Oh, man. I just feel like we're in such the early days, you know. I was thinking about our competitive space. So social media software, you know, like there's a few, there's a few bigger tools, you know, that you see the names of a lot and then there's a lot of smaller tools. But there's only like, let's say there's only like 20, even including all the like, really tiny ones, you know, the ones that have hardly any users, let's say there's 20 out together. Look around around you right now, whether you're like in your car, you're at the gym,

whatever you're doing. I cannot think of any category of anything around me. I see like a notebook, a pen, a water bottle, my computer, a lamp, right? Like, that would be crazy if there was only 20 competitors in any of these spaces. I just think it's still such a new thing. The field is still so wide open for software, for automation, for technology companies. And I think people often get nervous thinking, like, oh, there's already software that does that. Like, there's one piece of software that does that. Like, great, you know, be the second one that does that. You're always going to have their own spin on it. You're always going to do it a little different. So I think it's still, like, very much the early days of this industry. Why do you think there aren't more competitors

yet. Because, I mean, there's a few interesting sort of market things at play. I mean, one, the way that you raise money for a software company is really weird. So you have to go the, you know, VC, angel investor, whatever, you kind of have to go that route because banks still will not give loans for technology companies because banks give loans based on collateral, like equipment, real estate, sometimes large contracts and stuff like that. Sass companies don't have any of that stuff. So you can't, you know, when you open a restaurant, like there's this very clear path to do it. Like you get your financing, you go to the bank.

They know it's going to be a few years before you make the money back. For software, you either have to, you know, bootstrap slash self-fund or you have to go to VC route, which is weird because you can't build a company like mine because we're not trying to grow the company to be like this overnight flip. Right. And we're not pretending that it's going to be this fly. $500 billion company. You know, for us, if we get to, you know, I mean, even like, we'll go past $10 million annual,

but even if we just got there, like, that'd be a great business for me. I own 100% of the business, you know. But the traditional VC world is like, oh, that business is not even worth looking at because we need a much bigger exit. So I think software has fallen into this, like, weird spot where it's like, you can get funding, but it's this very specific criteria for the funding. where you have to build this much bigger business. You can't get traditional financing.

So you have to have the money somehow to put it in on your own. Or you have to try to bootstrap. But we call ourselves a bootstrap business. But I have to give respect to like the kind of bootstrapping, like real bootstrapping, where you make $5, you spend $5. You make $10, you make $10. You know, we were not in that scenario. And that's really hard to do because you can't spend any money on marketing.

And a lot of software companies have this fantasy that they'll just put it out. And then people will find it somehow. and then they go under six months later. So I just feel like the sort of infrastructure of the space is still being sorted out. That's an excellent point. What were the most effective marketing moves that you made? And what were some of the least effective? Yeah.

So the way I think of, especially when you're launching, there's kind of your short term and your long term. And I'm a huge believer in content marketing, organic marketing, obviously social media marketing, those are all things that are really important to us. But the problem with that is they don't drive a lot of people in the beginning. You know, the first day you start your Twitter account, you have zero followers and then 10, then 20, you know, it takes some time to build up. Same with your blog. You're not going to rank on Google on day one. It takes time to build up that content and build up that reputation. So the way that we approached it is knowing that organic was our

long-term play. That's where we, you know, we now get most of our customers from there. But in the beginning, we did a lot more ad spend because ads are how you can kind of cheat, kind of shortcut and say, Google, Facebook, I'm going to give you money in exchange. You're going to show my message to people, you know? You can pay those companies to do that. You can't pay to rank on search or else search wouldn't work anymore. So I think a lot of companies are a little nervous to do paid ads in the beginning. But the beginning can actually be a really great time to do that because you haven't been able to establish that, you know, word of mouth reputation yet, that search yet. So we were putting $40,000 a month and it paid ads in the beginning.

That's also when it's really easy to capture attention because you have something new. So, you know, I was talking about competitors earlier. I mean, if you're a person who uses a social media tool, you're interested in new ones just from that messaging alone. Like, there's a new social media tool. You know, like, I'm interested in new marketing tools and business analytics tools, because I like that stuff. I like messing around with them. You show me an ad that tells me there's a new one, like, I'm going to click on it. I'm going to go check it out. So there are certain, you know, industries, a lot of industries where your customers want to know that there's something new out there. Like, you wrote a certain type of book. I love memoirs. If there's a new memoir,

like, I want to know about it. Show me a Facebook ad. That's something that we did early on that was pretty effective that I think a lot of companies can copy. Is there anything that you did, particularly money that you spent in the early days, that you would have done differently if you could go back and give advice to your younger self? So we didn't have a big launch, which I regret. We had like sort of a little launch and then we thought, oh, well, we'll do kind of more segmented marketing. So instead of saying we're going to have this giant launch to announce to everyone, we thought,

oh, we'll try out different marketing messaging because, you know, we had the social media training business at the time. So we had a list that we could send messaging to about Edgar. And I thought, oh, I'm going to be really clever and I'm going to see which messages work, you know, which offers work. But because I did it that way, I missed out on the big like hoopla. Hey, everybody, we're having this really exciting launch event. You know, as we've referenced, we still grew relatively quickly. But when you look at our numbers from those first few months, It's literally like 20 customers and then 40, then 100, and then 200. It's not like you get 500 on the first day where I see, if you look at Ryan Levesk from Ask,

he just went from training to software. And he did it really smart where he had this giant pre-order campaign, where he got thousands of orders in, you know, before it even launched. And I wish we had done something more like that. I feel like I was trying to be a little too clever with my marketing segmentation. And I think that's a lesson to take away later too. I often see people setting up these really complicated funnels and complicated automations. And the problem with that is like, okay, well, now I have five different funnels.

They all have this lower volume. I'm trying to optimize all of them where if I just put all my attention into the one funnel, then I actually could optimize that regularly instead of kind of trying to keep all these spinning plates in the air. So we do always just try to focus, okay, how can we have like one marketing sequence that we can keep improving and send out to everyone instead of trying to create all these different marketing materials for every little different type of customer. Interesting. Some themes I keep hearing from this conversation is focus and simplify. Absolutely. I'm such a huge, I'm such a huge believer in that. It's the matter of doing one thing incredibly well instead of having the time

and energy to do three things mediocre. Excellent. Well, Laura, I won't take up any more of your time. Could you please tell the listeners where they can find you and where they can find Meet Edgar? Yeah, so you can find Edgar at meet Edgar.com or meet Edgar on Twitter or Facebook. We would love to have you. Come check us out. Automate your social media. And you can find me on Twitter at LKR. are or I blog at laura rotor.com. Great. Thank you, Laura. Thank you.

What an incredible conversation. I loved talking to Laura. There was so much that I learned from this interview that just it sent my mind spinning. So I want to draw out some of the things that I really took away from this interview, from the conversation that Laura and I had. And the first point that I want to make, the thing that really stayed with me more than anything else here, was the comment that Laura made about in the world. world of VC lenses, quote-unquote small software companies. Let's listen back to what she said. For software, you either have to bootstrap slash self-fund or you have to go to VC route,

which is weird because you can't build a company like mine because we're not trying to grow the company to be like this overnight flip. So this was fascinating. I've never thought of it like this before, but Laura is absolutely right. If you want to start a software company, typically you can't get traditional bank financing for that company. And VCs and angel investors aren't going to be interested in that because they see it as two small potatoes. They see it as pennies and they would rather chase the $10 bills. So it's not worth their time and energy.

Which means that if you're trying to create a company that will merely make $2 million or $4 million or $8 or $10 or $12,000 or $12,000,000. million dollars a year, who's going to fund that? How are you going to start that? One of the few ways to do it is to bootstrap it. Or, I mean, alternatively, I guess you could try some sort of like crowdsourced funding thing, you know, where you get like lots of small donations from a lot of, you know, maybe like a thousand people each give you a donation of a thousand dollars each or something like that. You could try something like that, but the point is that financing and funding for companies of this size, there's a big hole in the market for it. And I don't know what that means, but any time, I'm just planting this seed in my own head and in the head of anybody who's listening, any time that there's a hole in

the market, any time that there's an inefficiency in the market, there is opportunity. So I don't know what that means. I don't know what that opportunity. is, but I love spotting little market weirdnesses and market inefficiencies because that's what really gets the gears turning. So that was the main thing that I took away from this conversation with Laura. And I am really glad that our conversation turned to the future of software automation. You know, when I asked her that, I meant that more broadly. I meant what is software automation generally? Because as I discussed in last week's podcast, I'm fascinated by the concept of how augmented reality and virtual reality are going to change everything that we do in the future.

And, oh, and don't even get me started on moving to Mars. That's a whole other rabbit worm. Anyway, I was about to say a whole another rabbit worm. A whole another rabbit hole. That's kind of a tongue twister. Whole another rabbit hole. Whole another rabbit hole. Okay, but what else came out of this conversation with Laura? Well, there was something that she said in the beginning that I thought was a really

interesting framework. And she said this when she was talking about how she was. able to grow a company so quickly. Remember, she started this company two years ago, two and a half years ago, and it has now grown to 30 employees. And this is what she said about it. There are a lot of things that need to be done to make a business succeed. And as the business grows, there are even more things than if you want to make the business larger, there are even more things. And humans need to do hours of work. And somebody's got to do it. Like, it can be you or it can be somebody else. but somebody's got to do it. And when you add people to the team, you get more hours.

When I first started running a business, I guess when I first started running a business, I don't think I realized that I was actually running a business. I thought that I was just hustling. I thought I was making money. And so when I was buying rental properties, initially I was very reluctant to hire people out to do some of the work because I thought that if we just did the work ourselves, we could make quote-unquote higher profits. And I was very reluctant. If you, if, if anyone who's listening used to read my blog back in the early days back in 2011, 2011, number one, I'm sorry because it sucked back then. And number two, you probably saw some articles that I wrote there where I was really struggling with that question of, you know,

hire it out or do it yourself. And now, as, as anybody, who's listened to me for even five minutes knows, I'm completely on the outsource at all side of the equation. And that's largely because, as Laura so eloquently stated, if your goal is to grow a business, regardless of whether it's a business that you actively participate in, the way Laura does, or whether it's a passive business, regardless of either of those, you still need humans to work hours. And that human can either be you or it can be somebody else. But if that human is someone else, then if it's a passive business, that means that you can then spend your time hanging out on the beach. If it's an active business, that means you can then spend your time pursuing other activities that will allow the business to grow.

Either way, the conclusion is the same, which is hiring out will lead you to a better place. And Laura's framework of humans need to do hours, so if you add more humans, you have more hours, is just a very clear. simple way of looking at it. I liked the way that she said that. So that really stood out to me. But when you do hire out, the inevitable question becomes, what things should I let go of and what tasks are so important that I should do those myself? For example, I speak into a microphone for this podcast myself. This is totally my own voice. That would be hilarious though. If I got like a voice recorder, it was like, you can afford anything, but not everything. The decisions you make today about avocado toast can have impact on your future tomorrow. Yeah, so, you know, there are certain

things that I'm never going to let go of hosting this podcast, writing. I do all of my own writing for afford anything and for my social media updates. I do that all myself because to me the content is my unique value ad. That is the thing that I bring to the table. So anyway, the point being, when it comes to hiring out, the key question is, what is your unique ability? Where do you need to get involved and where is it okay to step back? And again, Laura had a really good framework for processing this question. Let's listen to what she said. There are totally things where I might do it different if I were in charge of customer service,

but that's not a make it or break it decision. That's not a make it or break it decision. that's the framework that like when she said that it was like a little ping went off in my head. What decisions are actually critical? What are the make it or break at decisions? And what decisions are details, noise that doesn't really matter that much? You know, life will move on. Your company will continue to grow.

Yeah, maybe you're not using the right piece of software that you would prefer. Maybe the cover art for each podcast episode isn't unique. Maybe you don't have exactly the right plug-ins on your website or, you know, maybe whatever. Life will go on. Your business will grow. You'll keep gaining customers or earning revenue or whatever metrics you choose to focus on as a signal of growth. I like that framework that Laura had. You know, what are the decisions that will actually make us or break us?

Those are the ones I'm going to focus on. And everything else I'm going to put in the hands of other competent people on the team. And every day I'm going to show up and not be the bottleneck, not get mired in decisions that need my approval. Constantly think about how can I step out of this so that things don't need my approval anymore. I love that she thinks that way. And that's a, it was a powerful lesson for me. It's something that I try to keep reminding myself of. So that is why I got out of this conversation with Laura Roder.

I'd love to know what you thought. So please hit me up. So you know where I'm hanging out these days actually? I've become addicted to Instagram. It's my new favorite social media platform. So hit me up on Instagram. I'm at Instagram.com slash Paula Pant. And let me know what you thought in I'll post a little Instagram posty thing, a little Instagram photo announcing this podcast episode. Just leave a comment there. Let me know what you thought. I would love to hear your reactions, opinions, questions, comments, any and all of that. You can check out Laura at meetedger.com. And by the way, I've seen.

started a YouTube channel. And initially, that YouTube channel was just the audio from this podcast. I didn't have any unique video there. But now I'm actually creating unique, original videos for YouTube. Yeah. So check that out because I think they're good. I realize I'm biased here, but I think they're pretty awesome. So maybe you will too. I don't know. You've made it this far. So YouTube.com slash afford anything, or you can just go to YouTube and search afford anything. That's where you can find the YouTube channel. Look me up on Instagram, and thank you so much for joining. Next week, Joe Saul Seahy from Stacking Benjamins joins me once again as he and I answer questions that you've sent in on another round of Ask Paula and Joe. If you enjoyed this episode, please head to iTunes, leave us a review, and while you're there, don't forget to hit subscribe. Thank you so much for joining. I'm Paula Kant, host of the Afford Anything podcast. I'll catch you next week. links to everything mentioned in this episode can be found in the show notes at afford

anything.com slash episode 79 that's afford anything.com slash episode 79