Founder's Story - From Fired to Inspired: Noah Kagan’s AppSumo Journey Going from $60 to $80 Million | S2: E17

Episode Date: February 27, 2024

This episode of Founder’s Story dives into the remarkable journey of Noah Kagan, a name synonymous with scrappy entrepreneurship and turning challenges into triumphs. Buckle up as we explore his path from a bumpy departure from Facebook to building AppSumo, a software marketplace that skyrocketed to a staggering $80 million in revenue in 2023 alone. Noah, a guiding light for over a million YouTube followers, isn’t just another success story. He’s a testament to the power of resilience and resourcefulness. Subscribe to our newsletter so you don't miss out on exclusive interviews and special content: https://foundersstory.beehiiv.com/subscribe For more info on guests and future episodes visit pix11.com/impact and https://fox5sandiego.com/fox-5-partners/impactful/Our Sponsors:* Check out PrizePicks and use my code FOUNDERS for a great deal: www.prizepicks.com* Check out Rosetta Stone and use my code TODAY for a great deal: www.rosettastone.comAdvertising Inquiries: https://redcircle.com/brandsPrivacy & Opt-Out: https://redcircle.com/privacy

Welcome to Founders Story, the podcast where trailblazing entrepreneurs share their extraordinary journeys. Uncover the passion, grit, and vision that drive the world of business and innovation. Hey everyone, welcome back to another episode of Founders Story. We've talked so many times that marketing is the lifeblood of your business. So many people don't know how to market their business. They don't know where to get the applications they need. Also, have you ever heard someone that could have been almost a billionaire was fired and then now has a business doing over $100 million? Today, we have Noah Kagan, who is the chief Sumo, I love the title by the way, of AppSumo.com,

which a company I've been using for a long time. They're doing over a hundred million dollars, incredible organization, amazing story, by the way, being fired twice, but Noah, welcome to the show. Thank you. We're almost a hundred million dollars this year. Almost a hundred million dollars. The number one $100 million this year. Almost $100 million. The number one site online for software deals. It's been a long, fun journey to get here.

Yeah. So let's go back to that. The change from working for a corporation, working for a company, to then saying, I want to be an entrepreneur. Because I know you have an incredible story with Facebook, Mint. Can you go back to that time and how that was for you in your life? Yeah, it's interesting because I think people think it's exclusive and entrepreneurship is the best investment anyone can do worldwide. And it's available worldwide, whether you're in San Diego, whether you're in South Africa, wherever you are. And anyone can do it. I had a day job at Intel. I was employee 100,000, you know, and I. I had a day job at Intel. I was employee a hundred thousand,

you know, and I didn't have a big following at all, but I just got started. And that's what's, you know, over a decades now, it's been 20 years since then. That's what's led me to put together everything in a million dollar weekend so others can do it themselves. But yeah, I was at Intel. Then I luckily just randomly got a job at Facebook. As it got started, I was number 30, fired there. Then I helped start Mint.com. I was number four there, got fired there. And then through kind of my own depressing journey, frankly, I eventually was able to find a business and thing that I love,

which is promoting software deals, which is what AppSumo became. My first deal was $12. I promoted a software deal and My first deal was $12. I promoted a software deal, and I made my first $12. And then yesterday, I think we did about $246,000 in a day. And I share these stories about that because I want people to realize it starts with just $1, and it can start today. And there is a technique and process that everyone can copy to live their own dream life. Yeah, I love that about your book. And it's it creates it takes concepts that makes them very simple and digestible for everyone. I know you talked about rediscovering your creator's courage, the unique ability to come up with an idea and willingness

to try small experiments and just go. Talk to me about that. that yeah i just got a text from a guy named alex and he's a common person just like a lot of other people where they they they're taught the wrong thing they're taught to go to harvard they're taught to buy more books they're taught to buy more courses they're taught to like buy a domain and come up with a business plan i'm like your plans to make money and help people let's's start there. And so creator's courage and the reality is that people are just afraid. There's so many recipe business books out there, but then how come everyone hasn't done it? It's because they're afraid.

And so what I do in the book with Million Dollar Weekend is how do I make it fun? Because it's fun. You're literally helping another person, and you're going to make a lot of money? How cool is that? And so how do you make it these small little challenges to build up courage? And courage really comes through action.

And this action, which, you know, we have the things with Alex, where instead of Alex doing all these things, he wanted to go help people do contracts. I was like, all right, great. So instead of doing all that stuff, he literally just messaged people in his network, and he got five paying customers in a weekend. And that's how it starts to lead

to a million dollar business and beyond. And most people don't think they're ever ready and they are. And most people don't think they're intelligent. And you don't even need to be intelligent to be a millionaire. That's the best part. There's a lot of regular people getting rich,

but you do need to have courage to face a little bit of fears and have fun with it and realizing you don't need a lot of money or time to make these things happen, just like Alex. Yeah, you mentioned about you don't need money, you don't need credentials, you just need to get over the fear of asking and starting. Can you tell me more about those two foundational, the habits, the entrepreneurial ignition, endless cycle of starting and the power of asking? Yeah, again, coming back on it after literally 10,000 plus people I've helped and millions on my YouTube channel and millions through AppSumo.com. I thought, you know, hey, here's how you start a business. You go get an idea, you validate, blah, blah, blah. But everyone got really hung up on these two core problems.

And it's the fear of starting and the fear of asking. And I've had so many people that have like, hey, I spent two years with this idea. And I'm like, what have you done with it? Nothing. And most people never become a millionaire because they never become a dollar in there. You got to become a dollar in there. And you know what you do after your first dollar? You get a second one and then a third one and then a fourth one.

And that's why I tell you the App sumo thing is you get your first 12 dollars you know fast forward 15 years you have those things so for everyone out there that's watching and this has been the biggest game chair and helping people think about the fear of starting is what can you do right now don't worry about the how now not how so what's the exact thing right now you can do to see if there's a problem that people are excited to pay you for you to solve? And I think people are shocked when they start thinking, huh, what could I actually do today? And they start realizing they could do a lot more. You could paste one of your paintings on Facebook Marketplace and see if there's something for a buyer.

You could message someone in your WhatsApp group and say, hey, I want to deliver food. You could contact maybe your accountant or your doctor or your lawyer and say, Hey, I'm working on a software thing. Do you want to pre-order it? And just doing things right in the moment, you realize that you can make a lot more progress than you realize. And you don't ever need to prepare so much longer than you usually do. And the second part is asking. And what people realize is that if you don't ask for stuff, you're never going to get it. you're never going to get it. You're never going to get it. Like today, I went to Starbucks and you get a free coffee on your birthday at Starbucks. It's not my birthday. My birthday was Saturday. Today is Wednesday. And I told him the truth. So I went to the counter and I said, hey, my birthday is Saturday. It's a

few days past, but I'd love to get my free coffee. And they said, you know what? Sure. And what you realize is the basis of everything in life is an ask. Like if you're married, you had to ask your partner. If you have a job, you had to ask for it. If you have a raise, you have to ask for it. If you want a customer, you have to ask for it. And the best part about asking is that it's a skill that everyone can practice. Everyone can get better at, and you develop more courage to ask when you practice it. That's why I teach everyone the coffee challenge. So you go to Starbucks and you ask for a 10% discount. And then after they reject you, which is what I want you to get, I don't want you to get the discount. I want you to practice to ask, practice that you got rejected, realizing it's not so bad. And then you could do

it again and again. And then you say, huh, I had this business idea. Let me ask that one person to be my customer. And turns out they may say yes. And eventually you will get a yes. And eventually you will have a million dollar beyond business. Yeah, that's the fear. Going back to the fear, that's something that's crippled me. So I can understand from some people's perspective, they get caught in that fear. Like they're looking 10 years from now, all the things that could go wrong. I think that's why a lot of people don't go from working in a comfortable job, making a decent salary to then

starting a company. I know you've done that a few times. I've also been fired twice. The last firing is the big reason why I became an entrepreneur myself. So I can relate to that feeling. But what do you think it is that holds people into that fear? And is there anything that you've you've found that breaks you through it? I first off, I appreciate you admitting honestly, that you're afraid of starting and asking, I don't think people realize that's what's held them back. And they also maybe don't realize they could actually change that today. They could get a dollar from one person today. That's why I give people a dollar in the book. It's the only book that pays you back. That's why I teach people asking. They can go practice that asking today.

And, you know, coming back on all these things, what I recognized for myself is that it always seemed risky to have a day job that I hated. That seemed risky. And you don't have to quit the day job, but you have to start building these businesses. And I just never wanted to live a what if life like, oh, man, I'd always want to try it. Now, what holds a lot of people back from it is thinking that they need permission for it. They don't. And also being patient with it. So I have a lot of people that have bought million dollar weekend and they're like, yeah, I make 100k. And I made my first hundred dollars in a weekend. Like, shit, I'm not rich yet. I'm like, you found something people want. Let's stick with it. I teach the law of 100 and a lot

of other process in the book, but it's now like, I didn't get rich from AppSumo until six years in. Now I make $3 million a year. And I don't say that to brag. I just say that my first year I made zero, you know, but you have to get started and then you have to find a ways in a fun way. And I don't say that to brag. I just say that my first year I made zero. You know, but you have to get started and then you have to find a ways in a fun way. And I teach Law 100 and others. So you can stick with these things so you can actually reap the compounded benefits. And most people, I think most people actually don't like their jobs. But it's scary. And I don't think it has to be a big all or nothing, quit your job thing.

I think you can start things. That's why I tell people to do it on a weekend. Because if you have kids, if you've got a job, if you've got hobbies, like you don't have a lot of time. But you do have a weekend to change your life. And you could start in a weekend and it may not work. And then have another weekend and another weekend and another weekend. Eventually it will work. And then sticking with that for some period of time and you will get these dream lives.

I got to add one more thing. I don't know if everyone believes they deserve or can have a dream life. So the thing I'd recommend for everyone is write down where you want to be at the end of this year, make your own dream life and be a little uncomfortable. And then start really just looking at that every single day. And you start realizing, huh, maybe I can live in two cities. Maybe I can have a wife. Maybe I can have a job eventually by the end of this year that I make a thousand bucks a month. I call it the freedom number. And if you start having it, you see it and you start taking a little bit of action each, every week, you start building that confidence and you start realizing like,

I can live this dream. It's possible. Do you think it has to do with the fact that with social media a lot of times we get caught in this like every post needs to be viral so we're really looking at at in the moment and maybe that's why different generations are different people it's hard to think oh my gosh i have to wait six years before I might make $3 million a year. And in business, we know it takes time. It's not like an overnight thing. I don't think it matters. It doesn't matter what you see on social media or people. Most of the time, it's not like you're going to get that one hit

and you're going to all of a sudden become a millionaire, which I like your whole weekend and starting with one. But what is it that you think about, you know, different generations, different people that may be thinking that it's going to be far from now when I'm going to see my success might hold them back from going into business because it's most likely not an overnight thing. We need to glorify sustainability and longevity and success. We need to glorify sustainability and longevity and success. We need to glorify that. Right now, what's glorified is fake millionaires.

Like the people who are showing their cars on Instagram are not rich. They're selling you courses. Same on YouTube. The other part of entrepreneurship that you need to think about is why don't you just have a career that you like? And yeah, maybe you didn't get rich in the day one, but yeah, day a hundred, day 500, you can get rich doing that. And I think that's the part that people need to acknowledge. Like you can get

rich being a horse trainer. The most wealthy mountain biker doesn't mountain bike competitively. He makes YouTube videos. His name's Seth. He runs Burn Peaks. He makes a million dollar plus a year. Doesn't compete in any, he's never won a mountain bike race, maybe as a kid. And I think that's part of the cool part of entrepreneurship is it's literally an unlimited upside. It's the only investment that doesn't take a lot to start.

Absolutely won't start for $60, which I think I could have done it for cheaper. I know I should have spent less. That makes millions of dollars a year and everyone can do it in any area you're interested in. And I think that's just such an exciting thing for me where I wish there was a playbook, frankly. That's why I wrote the book on it so that other people can do it for themselves. What do you think about bootstrapping versus getting funding?

And I really appreciate the book, by the way. I've started doing some of the things in there. And I think I love that it's just really simple and easy to do. But for somebody who's like, OK, I think I need to get funding. I want to try and get money. But if I can't get money, I'm not going to start it versus the mentality of, look, I'm just going to bootstrap this thing. I'm going to start with one person, get $1, $100, $1,000. What are your thoughts on those two things? Yeah. So I literally start the book with called Frequently Made Excuses, which I thought was a little funny and different. And by the way, business, it's supposed to be fun. If you're not having fun, change the business.

And I talk about how you don't need money to start any business. And what people do is they give themselves excuses, and that's a way of avoiding actually solving a problem and starting a business. For funding, I'm 100% against it. I bootstrapped this business. I think every business can be bootstrapped. What I recommend, though, is that if your business is working and funding would accelerate the business, I a hundred percent would encourage it. But most people, you can go find that there's a problem people want to pay you for and make sure it's something they actually want right away. Let me

give you some examples. Your hotels, you prepay for them. Your Airbnbs, you prepay for them. Tickets, concerts, you prepay for them. Your flights, you prepay for them. Everything. Well, Noah, don't I need to buy a plane to start an airline? No, you need to see if there's passengers. Then go get funding now that you know you have a bunch of passengers. But what people want to do is it's a way that they can avoid the work. I need a founder. I don't have any ideas. I need funding. Those are all solvable. And I promise you, once you have a business that's working,

which you don't need any of that for, it is much, much, much easier to get funding and founders and whatever else you need as you have validation, which is what I teach. I love that. What do you think about, like I know Cody Sanchez right now, you mentioned her in the book. She talks about buying businesses, buying existing businesses,

this whole silver tsunami of people that are retiring, that have their business, that are probably just going to let it die. I think at least a guest before had called it that. What do you think about somebody getting in at that angle of buying an existing business? I'm one Cody's a friend and I like it, but I have a hundred percent against it. That's like saying, Hey,

you don't know how to drive a car, go on this racetrack and drive. You would never do that. So how can people think it's going to work in business? They're going to go mess it up and waste a bunch of money. But there's the illusion. You get this business. It's an ATM machine.

And then it automatically works. Like how many times now are we hearing stories where someone bought the business and the founder bought it back for a dollar? Barstool Sports? Bestself.co? There's all these businesses that are happening. And why is that? Because the operators don't care like the founder and they don't have fundamental understandings of business.

They don't. So they're going to mess it up and that's not their fault. They just don't know. So what I recommend, I don't think buying businesses is bad at all. I do. I think it's not a bad thing, but I think you have to understand how businesses operate and you have to do it yourself in a low risk environment. Starting business is very not risky. Having a day job that sucks is high risk. And so go practice it. Do customer support. Try to do marketing. Try to do sales. Try to do website if you need a website. Try to talk to customers. Do those things so that as you buy a business, you have a full understanding of what you're actually buying. I'm seeing behind the scenes of people that buy that stuff.

Like someone bought one of Hormozy's companies called Allen. That's when it's going down the drain. I've seen a guy bought an ice machine because it's a boring business. And now he's an engineer that can make six figures to seven figures coding. He's selling ice machines to gas station owners. And again, I don't know if those are all inherently bad. They're just an easier way. Hey, I enjoy that.

You know, I think there's different perspectives, experiences, but I'm with you. It reminds me of the E-Myth. I don't know if you read that book way back. That was like the OG business book around the baker has to do everything in the bake shop to fully understand but um what's one thing looking back through you know your entrepreneurship all the things that you've done success i know you've you know from app sumo king sumo all these

other applications that you've launched and all the things you've done. I've used them all, by the way. And so the person that told me about you, I was talking to him a few days ago. I was like, hey, you know what? Noah's going to be on the show because we both had a similar entrepreneurship starting. And we always used to call each other like, dude, what are you doing here? What are you doing here? And we all used AppSumo. He's the one that told me. But what is one thing though? During that whole time, what is one thing, one lesson that you say, you know what? Besides what you've told me today, but if there's anything really more coming from a challenge or, you know, a step that you saw, it's a lesson that you tell every single person. So one lesson, you're like, I have to tell them this lesson because they need to know so they don't do what I did. I mean, starting led me to where I am.

Like there's no way I would have, if I would have sat and had a job and waited, like maybe I'll think of an idea and get a million dollar idea. There's no million dollar ideas. There's million dollar opportunities. So number one, you have to start because that's going to get you to your destination. Sitting and waiting, sidelining, as I call it, will never get you there. Number two, practice positive self-talk daily, hourly. Keep recognizing that you're doing better than you think. You got a customer, you got a dollar. Awesome. Most people, I would say specifically, you know, successful entrepreneurs are very unhappy. And I'm seeing a lot of entrepreneurs who are like, I need to be a billionaire. And I'm like, I'll tell you, being a multimillionaire is more than happy for me. I'm just exceptionally happy.

And so I think people keep chasing happiness. And if they could work on more positive self-talk and finding internal happiness, they'll enjoy the whole journey, whether they're an entrepreneur or not. I'd say that's number two. And I'd say the third part that surprised me but I regret it and it's been a significant game changer is finding a good life partner earlier. I wasted probably a decade and so many hours and emotions and therapies by choosing incorrectly. I was getting what I got. I wasn't getting what I wanted. And you have to know what you want, and then you have to ask for it.

Remember? We talked about it. You have to ask for it. And so find a great husband, wife, whatever it is you need out there, and that will be a game changer for you. Amazing. No, very, very relatable on those things. things uh having for me a life partner has been game changing she's my advisor she's my sounding board we compete with each other in a positive way

friendly manner she inspires me so i can relate to that but million dollar weekend and noah where can they find you how can they get the book because not only do they if they buy the book they get a dollar back which i've never had a book pay me back by the way but yeah i do there's my information how to get paid and there's not tricks or anything you message me and i send it right back to you but it's an example of how do you get started and i want people to realize that that's what business is it's just a system of starting and asking you keep doing it over and over you can get the book at milliondollarweekend.com or wherever books are sold you can find me and you know send me pictures of you in the book you getting paid at noah kagan

everywhere online n-o-a-h-k-a-g-a-n awesome noah kagan thank you again million dollar weekend check it out you can read the book in one two two days. It's incredible. I got the audio. Really listen to it. It's you, right? That is you on the audio, correct? It's me. That's me, man. Wow. There you go. Noah, thanks again for being here today on Founders Story. Thank you for tuning in to Founders Story. Keep exploring, keep dreaming, and join us next time for more inspiring entrepreneurial journeys.