Leap Academy with Ilana Golan - Tim O’Reilly: From $500 Startup to Open Source Pioneer | E109

Episode Date: May 29, 2025

Tim O'Reilly’s entrepreneurial journey began with odd jobs like being a janitor, cemetery caretaker, and dishwasher. With just $500, he founded O'Reilly Media, initially focusing on publishing tech manuals. After a major setback during the dot-com bust, which saw revenue drop by $20 million, Tim shifted to building a sustainable, value-driven business. His work with Web 2.0 and open-source technologies like Linux and Perl helped position O'Reilly Media as a key player in the internet’s evolution. In this episode, Tim shares how he built O'Reilly Media from the ground up, navigated industry shifts, and why focusing on value is essential for long-term business success. Tim O'Reilly is an entrepreneur, author, and the founder of O'Reilly Media, a leading tech publishing company known for its groundbreaking books, conferences, and online learning platforms. In this episode, Ilana and Tim will discuss: (00:00) Introduction  (02:29) Growing Up with Poor Vision and a Love for Books (03:53) Building O'Reilly Media with Just $500 (07:07) Leadership Lessons from the Dot-Com Crash (11:32) How Web 2.0 and Open Source Transformed the Web (19:27) The Problem with Silicon Valley’s Business Model (26:15) Scaling a Business with Limited Resources (31:11) AI and the Future of Programming (35:11) Tim’s Key Lessons in Entrepreneurship (37:47) Why Every Business Should Prioritize Value Tim O'Reilly is an entrepreneur, author, and the founder of O'Reilly Media, a leading tech publishing company known for its groundbreaking books, conferences, and online learning platforms. A key figure in the evolution of the internet, Tim played a major role in popularizing tech concepts such as open-source software and Web 2.0. He has been a strong advocate for ethical technology and continues to explore the future of AI, programming, and innovation. Connect with Tim: Tim’s Website: oreilly.com  Tim’s LinkedIn: linkedin.com/in/timo3  Resources Mentioned: The Whole Internet User's Guide & Catalog by Ed Krol: https://www.amazon.com/Whole-Internet-Users-Guide-Catalog/dp/1565920635  Sailing Alone Around the World by Joshua Slocum: https://www.amazon.com/Sailing-Alone-Around-Joshua-Slocum/dp/0486203263  Dune Mass Market by Frank Herbert: https://www.amazon.com/Dune-Frank-Herbert/dp/0441172717  The Golden Warrior, the Story of Harold and William, a Novel of the Norman Conquest by Hope Muntz: https://www.amazon.com/Golden-Warrior-Harold-William-Conquest/dp/B001DA6IKC  Leap Academy: Ready to make the LEAP in your career? There is a NEW way for professionals to Advance Their Careers & Make 5-6 figures of EXTRA INCOME in Record Time. Check out our free training today at leapacademy.com/training

Wow, this show is going to be incredible. So buckle up and I'm sure you're going to enjoy it. But before we get started, I want to ask you for a favor. See, it's really, really important for me to help millions of people elevate their career, fast-track to leadership, land dream roles, jump to entrepreneurship or create portfolio careers. And this podcast is all about enabling this for millions of people to see a map of what it actually takes for big leaders to reach success.

So subscribe and download so you never miss it. Plus, it really, really helps me continue to bring amazing guests. Okay? So let's dive in. Money in a business is like gas in a car. You have to pay attention to filling the tank. In business, you should have a purpose that's bigger than money. And if you do, then you're just trying to find a way to finance the tank. In business, you should have a purpose that's bigger than money. And if you do, then you're just trying to find a way to finance that purpose.

Tim O'Reilly is a true pioneer in the tech world. As the founder of O'Reilly Media, he played such a crucial role in evangelizing the World Wide Web, the Perl programming language, Linux, Open Source, so many others. My only jobs before I started my own company, I had been a janitor at a home for the mentally retarded. I'd been a cemetery caretaker at Arlington National Cemetery, mowing lawns. I started my company with $500. Win big or go home is just part of the myth of Silicon Valley. For thousands of years, people have started businesses with whatever they can scrape together, and they basically grow bigger.

How do you keep growing in terms of expanding to the conferences and to venture capital and investment? Three things. One was... Today I have a really fun episode. It's extra fun for me. It's going to be amazing for you. And I want you to listen because when I got into Intel, the very first job I ever had. I was put in front of this big pile of books and apparently they were all Tim O'Reilly here and just so excited to have him on the show with us. So Tim O'Reilly is a true pioneer in the tech world. It's someone that didn't just ride the wave of innovation but helped define it. And to me, it's just so interesting because as the founder of O'Reilly Media, he played such a crucial role

in evangelizing the World Wide Web, the Perl programming language, the Linux, the open source, so many others that we're gonna talk about. But O'Reilly Media is expanded into online publishing and conferences and magazines and early stage ventures, investing, etc. And I'm just so excited for you to hear this incredible, incredible journey. So Tim, thank you for being with me.

Oh, thank you for having me. And I'm glad that the books didn't put you off and that you kept going. I became the master of Pearl here. It was all thanks to you. I want to take you back in time for a second, Tim, because the way you grew up somehow sparked that love for books, for writing, for what do you think shaped you to the person that you are today? Certainly reading. I was a total nerd.

I basically, I live very close to my school, less than a block away. We had an hour for lunch and I ran home and spent the entire time reading books. So I was not terribly well socialized. I was fairly blind and my older brother had this idea that if we wore our glasses, we'd become dependent on them. So I did not wear, even though without my glasses, I was the equivalent of legally blind. And I didn't wear them until I was in high school. I basically wore them when I suddenly, you know, you're in high school and you start having friends and people would say, Hi, Tim. And I was like, who was that? that I would turn around and try to figure out who was it just said hi and I realized

My gosh, that was the stupidest advice for my brother ever Didn't you like what's in there Give me my pocket and I would put them on when I need to see the blackboard, but it definitely Hurt my sports career. I didn't really take up sports until I was in my 30s. That's when I learned to play basketball and soccer. So how did you move from there to starting to write manuals? My only jobs before I started my own company, I had been a janitor at a home for the mentally retarded.

Is that serious? Oh my God, that's so random. I had been a cemetery caretaker at Arlington National Cemetery, mowing lawns, and I'd been a dishwasher in a deli that we referred to as the greasy spoon. Those are my three jobs. Then I had a student job at Harvard and a student job being a janitor, but I never had any other job. I came out of college and I basically did this work on George Simon's notebooks, and then I got this Frank Herbert book to write.

And then because I have this connection with this friend who got asked to write a manual. I just said, I'll help you out. That started everything. Were there moments where you're like, oh my God, this is hard. I don't even know if it's going to pay the bills. Let me go back to work? Or was there any like, Well, because I've never had any like, I've never had a job.

And of course the original business became a consulting business. So work was very precarious. Anyway, the book businesses we know today actually started in 1985 when there was a big downturn in our consulting business. And I had maybe 12 employees at that point. But we were all contractors. I was the only employee. I just basically had work for people when I had worked for them.

But because I didn't want to just turn them out on the street, I said, well, while between jobs, let's write some manuals of our own. We started looking around and we go, there's no manual for this, there's no manual for that. People will buy it. We produced a few of these things and they caught on and

the rest is history as they say. So you notice even when it was hard, you're basically adapting, finding another thing that maybe will work out. Eventually we'll talk about venture capital versus non-venture back because I think when your back is a little bit against the wall, you have to find other ways. I think it's super interesting and it really eventually shaped what my partner Bryce Roberts did at Alpha Tech Ventures with Indie VC, was to look for businesses where the funding comes from customers. We got our funding from customers. That's amazing. Same with Leap Academy, right?

Bryce told a fabulous story about the founders of RX Bar, those fitness bars. There was two friends and both of their parents were immigrants in the restaurant business. They came home one day with their business plan. They were going to grab venture capital for this fitness bar. The father who was this very different generation of entrepreneur, starting a restaurant or whatever, he says, forget about that, go out and sell some bars. They did and they formulated themselves,

they've looked into this, they figured out they could piggyback on CrossFit. They end up building a business which they sold for $800 million with no VC. I started my company with $500 and everything else came from customers. There's one exception, which is in that period when we nearly went out of business, my mother gave me a $10,000 loan. And then a few years later, she said, Hey, do you still need that money? I'd like to give it to your brother so he can buy a house. It was an interest-free loan. But tell me about those moments when they're really, really hard. And I think the reason why I'm asking, and I'm sure there were more,

because as you grow, there's just a risk is just bigger. Yeah, dot com bust. I lost a lot of my hair then. I will go there because I was assuming that that was a hard one. I mean, it was hard for everybody in tech. But let's take one of those hard moments because I think as a leader, especially if there's no million spare sitting there as cushion, that can get really, really, really hairy. The toughest time for us was with the dot-com bust. We had just moved into a new building, new complex of buildings. We had tried to leave space for growth, so it was too big for us already. We tried to move in about two-thirds full, and suddenly our revenues dropped, I think,

in one year from 70 million to 50 million. It was pretty brutal, and we had to do layoffs. I had always run a very paternalistic company. I still remember sitting there, poring over the list of people who were trying to figure out who to lay off. And I have a binder with all the names. And we were probably three or four hundred people at the time. I had to let go of a hundred people. And I suddenly I go, why is there all this hair on my binder? Wow. My hair was falling out. I was so stressed. Not only that, I then didn't get paid myself for a couple of years because we had some debt that I had to basically sign a personal guarantee on all the business debt.

So it was pretty, pretty rough. How do you go past it? Because I think this is the hardest thing for entrepreneurs to not give up. And even for people right now that there are layoffs, there's lack of work. What do you think helped you through that really hard moment? Because it doesn't sound like that short. It sounds like a couple of really hard years that you needed to somehow motivate yourself to get through.

I didn't think about it as having to motivate myself to get through it. Yeah. I remember once reading Sir Joshua Slocum's book about sailing around the world solo. You know, he's in a big storm, and he's lashed himself to the wheel. It goes on for like several days. It's like, if I fall asleep, if I let go, I will die. And at first he said, I can make it through another hour, you know, another day or whatever. And it's like, I can make it through another hour. And then ultimately, I can make it through another minute. And I was just like, okay. It just never occurred to me that there was an alternative to going forward. I don't know, partly because I felt enormous responsibility to all the people who worked for me. And I guess that's something also just there were two books that I read

when I was a teenager that really shaped my view of leadership. One was Dune, which of course I had read it when I was 13 or 14. I later got to meet Frank and write a book about him and his work. But there's a scene early in Dune where Paul's father goes down to rescue, you probably remember if you saw the movies recently, he goes down to rescue the men in the Stranded and the Spice Crawler. And the people are all amazed to see that he risks his own life for his people. And it's just in the book, it's just super clear. That's the compact of leadership. And I probably had gotten that even, I don't remember which one I read first, there was a wonderful historical novel called The Golden Warrior by Hope Munts

about Harold, the last of the Saxon kings. And if you don't know the history, he had had a huge battle up in the north of England with the Vikings who'd invaded with his half-brother Tostig, and he fought them off. And then William invades in the south, and everybody's saying, you've got to regroup, you've got to regroup. And at least as told in this novel, he was like, that's not the deal. These people follow me, and I protect them. That is the deal. And so he basically went south to his death, right? And it's a beautiful story. And it just totally shaped my idea of what it meant. So these people are choosing to follow me, and I owe them a duty of loyalty. I had this idea of a company as a pact of mutual loyalty.

Of course, not at all how people think of it these days, but that was my route version of entrepreneurship and leadership. It was probably very tribal in a sense. You go, I've got to bring down the mammoth, you know, because we're starving. We just tried different things. Two years after the dot-com bust, we were still hurting. Our strategic goal for that year was how do we reignite enthusiasm in the computer industry? Because everybody was like, it's over.

That's when I basically told the story of Web 2.0. Why did some companies survive the dot-com bust? Why Google? Why Amazon? Why did they flourish when so many other companies died? And I tried to tell a story about that. And then, of course, everyone, oh, now we understand that the principles of this new era are collective intelligence, big data, what I called at the time,

now we now call it cloud computing. I called it software above the level of a single device. You know, when I wrote that, what I called at the time, now we now call it cloud computing, I called it software above the level of a single device. When I wrote that, what is Web 2.0 paper, it just catalyzed the industry. And for those, by the way, that don't know, you literally coined the term Web 2.0, which is kind of- That's not quite true.

Not quite true? Okay. No, my colleague, Dale Doherty, who was one of the first people that I hired at O'Reilly, coined it. I had been writing, and this again goes to this notion of how maps and terms and language emerges. So when I convened in 1998, which is six years earlier, the meeting that came to be called the Open Source Summit, because that's where a group of free software leaders agreed to use this new term. My first

piece was this pattern recognition thing. I've been concerned about this notion that the free software narrative that was being told by Richard Stallman and the Free Software Foundation was just wrong. Because I go, wait, wait, how can you be talking about free software and not talk about the World Wide Web, which was put into the public domain? But anyway, so the point was, I told this new story that the internet, not the Free Software Foundation and Linux should be the heart of this story. And it really changed the arc of that narrative. I'd also learned early on this great trick from this guy, Brian Irwin,

what he really taught me was advocacy as marketing. Tell a big story. When we published the book, he said we're going to go on tour and he said, but people don't care about the book, they care about the Internet. We use the book to market the Internet. We didn't try to market the book. Interesting. Then five years after that, here I am at

the open source meeting and I organized, I got a lot of press contacts through this period of being an advocate for the commercialization of the Internet. So I invite them in and I got a lot of press contacts through this period of being an advocate for the commercialization of the internet. And so I invite them in and I have a set of people. I go, well, what's the most mission and critical program on the internet? And they're scratching their head. They've not heard this story before.

And I say, I'd memorized the IP address for the New York Times and the Wall Street Journal and whatever. And I said, yeah, yeah, you get to call yourself NewYorkTimes.com instead of whatever their IP address was. It goes, this guy over here, he wrote and has been maintaining for the last 15 years, this software called the Domain Name System. This program called BIND,

the Berkeley Internet Name Demon. Okay, you send email, it's this guy here, he wrote this. I went down the list and I finally, about number five, I got to Linus Torvalds. I'm talking about Linux. I said, you're able to do all these things because of this software that was created and given away by these.

Open source, like the whole concept. A month later, Linus was on the cover of Forbes, there was a spread of all these guys, full-page photos inside, and changed the narrative. But here's the thing, the narrative was still wrong. Most people don't really remember this ancient history, but every skill was focused

so much on that open source was about licenses. My pattern recognition sense was like, that's just wrong because I lived the open source story through the early part of my life with Unix, which was basically this community had grown up under the proprietary license from AT&T. And you had Berkeley Unix, the Berkeley version. I was from a Berkeley Unix guy more than a Linux guy. It was this community that was happening. I went, oh, this is really about re-centering on the Internet.

It was really about Internet-enabled software development was really at the heart of this. It was also about something that I called the architecture of participation. It was something about the design of Unix itself that made open source possible. It was even going back to my first experience with the documentation problem, you actually had to give source code.

It was a big freeware community on say, back when I first got my first computer, which was a personal computer which was an Osborne. There was this the Bog Live, Osborne user group library where you got all this fabulous free software, it was all binary. But Unix, it was all source code because the underlying architectures was like, you might be running on a digital machine,

you might be running it on a data general machine, you might be running on a prime machine, you might be running it on a Burrows B20. So you had to have source code. And so the source code culture grew up around Unix. And it's funny because I still remember the arguments in Intel, what are you going to use? And there was camps of people, which one is better?

And yeah, yeah. But anyway, so the point was, I kept thinking about all this and it kept taking me further and further down the path into thinking about networks as the center. And so then after the dot com bust, I started noticing, I ran a conference in 2001 called Building the Internet Operating System, which is again a kind of pattern recognition. I said, increasingly the internet is becoming the platform. If you're feeling stuck, underpaid or unappreciated,

or you're simply ready to take your career in life to the next level, I have the perfect solution for you. We have a program that helps you fast-track and leap your reputation and career, become the best version of yourself, get the dream role you deserve, move up to leadership, jump to entrepreneurship, or even build a portfolio career. This program helps hundreds a year, and it will help you gain the income, influence, and impact that will transform the second part of your life.

Watch our free training today at leapacademy.com slash free hyphen training. The link is in the show notes. Now back to the show. So Tim, you have this ability to on one hand be 30,000 foot view to just see the trends, see what's going on. But then if you need you just zoom in and you get the details as much as you need, then then you zoom back out. Do you feel like that's what you're doing?

I think of it more in this image of one image I've used and trying to explain to people. It's like you're doing a jigsaw puzzle, which is a pattern recognition exercise again, but all the pieces aren't on the table. And then somebody dumps another 100 pieces on the table and you sort them through and then suddenly you can see a piece of the pattern you couldn't see before. In the case of Web 2.0, I had been going down this path of trying to talk about the internet as the platform. And then Dale was the one who came up

with this notion of Web 2.0. So I had run this series of conferences. I had started with really this notion that in my building the internet operating system, there were three things that had landed on me at the same time. And one was distributed computation, which was through applications like SETI at home.

You may remember that, whereas people were using, they would basically put a piece of software on your PC, so you'd have distributed computation running across thousands or tens of thousands of PCs. It was the era of Napster, where basically instead of having all the songs in one place, everybody would be serving them up to each other. So that was the whole peer-to-peer movement. And then there was the beginning, very beginnings of web services. Basically, these were all the same thing. They were all people who were starting to see the internet itself as the platform and they break out of the paradigm that software just lived on a device. And then the piece that clicked it into Web 2.0 was Dale had tried to put together a conference with another company that used

to run Comdex and they wanted to do something with us and we wanted to learn from somebody else who had been doing the business longer than we had. So we said, let's do a joint venture and launch a conference together. And Dale's the one who came up with calling it Web 2.0. If you read the What is Web 2.0 paper, it's basically this one table in the beginning, which was where Dale was saying, here was Web 1.0. You're going to be a portal. You're going to aggregate Web 2.0 syndication.

It was a bunch of things that we did, a set of comparisons. And then I kind of brought in all of my ideas about the Internet as an operating system and fleshed that out to tell a story about what was really going on. So how and when do you decide to expand? Because it sounds like you actually created a conference in 2001, which was the hardest. Okay. So why, when it's so hard, when you're in the.com theme. We were in an expansive period and that was was before, but it was again a pattern recognition

exercise. It was really triggered by the fact that I had become friends with a guy named Andrew Schulman. Again, you just hear these little people just drop a piece on the table. It was in the early days of a Microsoft technology called ActiveX. Andrew had written a book called Undocumented DOS and Unauthorized Windows 95. He was an author for a different publisher, but he eventually came to work for me because I decided to

try to do some Windows-based books. He told me about this national advertising campaign by Microsoft about ActiveX. We're activating the Internet. He said, actually, everything in that commercial except the little animated taxi cab that was going across the screen was done with Pearl. I was outraged because Pearl,

of course, was our best-selling book. I got outraged and it was also right after Sun had introduced the Java 1 conference, this massive Java conference. I go, wait, there's no conference for Pearl. I decided to throw a party for them. It was really this idea of it would be in some sense a subsidized marketing.

I didn't really think of it as a business. It was really like, oh, Sun is marketing Java. We could do something for these people who've given so much to us. Then I realized, oh wait, all of our bestselling books are about, which is what led me up to the open source summit the next year. Maybe it gave you another piece of how reading and literature and the kinds of things that shape your personal philosophy.

There's two books I'm going to mention. One is a book from the 1930s called The Meaning of Culture by a guy named John Cooper Powers. He was a Welsh author and lecturer. The Meaning of Culture is about the difference between what he calls culture and education. He said culture is the education that you put to use in your own life, your personal culture. That became a lens for me. And the other thing I was going to tell you about as a piece of personal culture is this fabulous scene in the Canadian television production of Anne of Green Gables, which I watched with my daughter when she was 10 and came to love those books. A story of Anne of Green Gables is an orphan who is adopted by this

elderly brother and sister who the brother is sent to get this orphan, and he accidentally brings home a girl instead of a boy. And his sister says to him, a girl, what use could she be to us? Richard Farnsworth is the actor. And Richard Farnsworth saying in this slow kind of thoughtful way, said, well, I was thinking maybe we could be of some use to her. It's just such a beautiful line and it went right in. So why did I do the Pearl of Commerce? I thought we could be of some use to this community. This kind of goes to entrepreneurship.

We've perverted the idea of entrepreneurship, I think, in Silicon Valley. It's become about, this is this way to get rich. There's always been a thread of entrepreneurship, I think, in Silicon Valley. It's become about, this is this way to get rich. And there's always been a thread of it, but there's also this essential thread that we forget at our peril, which is- To give value?

To give value, right? And it's this thing, oh wait, there's this opportunity to be of some use. So the opportunity to serve is also the opportunity to profit, because if you serve customers and they pay for what you do, that becomes a business. But this whole idea that now the whole game is,

it reminds me a lot more of the mortgage business before the big crash of 2007 than it ought to, where the idea is what we're really trying to do is create a financial instrument that we can sell to other investors. And yeah, and it's so driven by growth and so on and the whole blitz scaling idea. If we can tell a story that gives us a higher and higher valuation, we can eventually walk home with a ton of money, even if the business isn't sustainable. You look at WeWork as an example of that.

You're saying something really smart. I'm in Silicon Valley now and I almost feel like we're celebrating how much people raised instead of how much value is created, how much revenue is created. And again, from time to time you have to, maybe there are deaf-finged businesses that you need to raise before you can. But then I think we already forgot that most businesses can actually create value, create sustainability before they need to raise hundreds of millions or billions of dollars.

I think we lost it a little bit. I think it's the sickness in our entire economy that you can make so much more money by financializing a business than by delivering value to customers. Again, there are absolutely cases where you need to raise a ton of money. Think about Tesla building out the Supercharger network, or thinking about Amazon building out its warehouse and delivery infrastructure.

But it's really interesting because Jeff Bezos actually understood that because he was actually delivering value to customers, he was getting their money upfront. He didn't actually raise that much money. He borrowed a ton of money. Amazon was funded with debt. I had that once. Our version

of venture capital tend to be joint ventures. I built my international business in a joint ventures with a company called International Thompson. Then I bought them out at some point. When we started the first web portal called the Global Network Navigator, we sold the AOL and we had a joint venture with them on the first content side of the web, something called Songline Studios, a content studio. We eventually bought them out. And in a similar way, we started this what we called Safari Books Online with our biggest

competitor starting in 2000. And then in 2014, we bought them out, essentially, because I had a conversation, I thought, oh, we'll have to take some venture capital. And I talked to an old friend of mine who was a private equity guy. And he said, I'd love to invest in your business. But why wouldn't you do this with debt? We had cash flow from the business, positive cash flow. So we ended up buying it with a loan. So I think there's a bigger palette of financing opportunities if you're not thinking your goal is to exit, but to actually build and run a business. But so much of Silicon Valley, it's like you start the company with the idea that you are going to sell it, sell it as fast as possible for as much as possible.

And occasionally, people are really clear, I wanna build this as a business, but not often enough. But tell me, because I think there is something a lot. I don't know if it's harder because it's different. I had a startup when we raised capital and now I'm bootstrap, but there's something harder in the sense of every dollar that comes in, this is what you can use basically.

There's less cushion, there's less reserve. So talk to me a little bit about how do you keep growing in terms of expanding to the conferences and to venture capital and investments and like, how do you look at expansion? Because I was always self-financed, the business was always, does this make more money than it costs to do it? Eventually, you get some scale that allows you to place some bets.

But in a lot of ways, the book publishing businesses, you're continually investing, you're spending a chunk of money to develop a book, you buy a bunch of inventory and it might not sell, but on average they do, you know, a conference, you know, if you do it right, you put out a bunch of money upfront, but you get it back not long after. And so we've tended to be in those kinds of businesses. Now we did,

for example, build GNN back when we started it. We lost the whole Internet Users Guide in 1992, and then we lost GNN, which is the first web portal in 1993. For two years, we put every penny of company profits. We spent a third of our revenue on this thing that had no profits, that we didn't know what it was, but we thought it was really important.

And eventually I sold it. And the reason I sold it was actually because, again, it was pattern recognition. I had read a book by Ron Davido called Marketing High Technology, and he had an appendix in which he talked about what he called the math of market domination. And he said, in order to dominate a market, you have to be at least half the market and growing faster than the market as a whole. I thought, oh, there's no way we can do that without taking in massive amounts of capital, and I don't want to do that. The reason I didn't want to do that was because of my experience a decade earlier as a consultant working with,

I mean, it was more than 15 years earlier, working with all these startups that turned out to be very boring and unpleasant companies, that were idealistic and whatever, and then they became just like everybody else. I didn't want to be like everybody else. Amazing. Do you feel like you needed to build this tolerance

for money? As a leader, you need to invest big amounts usually, right? Before you're gonna see the return. And I feel like sometimes one of the things that I talk to my clients about is the shift in how we need to think, right? Because I used to think as if then else, right? If I get this, then I do this.

If I get this, then I do that. As a leader, you don't really have that luxury, right? It's more you take the risk, then you'll see the return later. You take the risk, you say yes, and you take the risk. Let's just stomp in my experience. Yes, it's true. But this notion that it's always you're taking your big investment, big risk, big swing, win big or go home is just part of the myth of Silicon Valley.

For thousands of years, people have started businesses with whatever they can scrape together. They scrape by and some of them are good at it and they basically grow bigger. Our first books that we published, my first print run of my first book was 100 copies, and they cost us a dollar, and we sold them for $5 each. And we went, oh, that worked, let's print some more.

It does not have to be a big swing, and you just bit by bit. You know, it's still a bit like Annie Lamont's wonderful book about writing, it's called Bird by Bird. But you're running a big organization now. The swings are not that small. It is.

Actually, most of them are a lot of small swings. Yeah, I mean, yes, there are big things that we invest in, but relative to the scale of the company, they're not big. They're not bet the company big. Now again, in one sense, you're always betting the company because the collection of all the things you do, even if they're small, add up to the company that you become. But you have to pay attention to it. One of the things I wrote once,

it's probably the thing of mine that's been probably repeated as much as anything on the internet, is that money in a business is like gas in a car. You have to pay attention to filling the tank, but you are not making a tour of gas stations when you go on a road trip. In business, you should have a purpose that's bigger than money. And if you do, then you're

just trying to find a way to finance that purpose. It's a very different approach than if you think your job is to make as much money as possible. If you think your job is to do something, you know, you find ways to make it happen. That's beautiful. So what is 2025 and beyond waiting for us? With AI, the pace of change, the economy, what do you think? I've been semi-retired for the last 10 years and AI has got me back in founder mode for two reasons.

One, it's an existential threat to our business. I do think that there's a lot of new capabilities and basically the AI companies have basically been pretty ruthless in stealing everybody's content and basically making products that effectively compete with the people whose content they trained on. That means we have to think about, well, what's our value beyond replacement?

And we have a lot of ideas about that, and we're doing some great new products. But it's also calls for some of the things that has been a big part of what I do in the past, which is storytelling. So one of the things that's been a threat to our business is there's been a whole narrative out there that we're not going to need programmers anymore.

O'Reilly is primarily an enterprise learning service that we sell to corporations. I mean, we do still sell books and so on, but the biggest part of our business is a subscription. So these corporate learning buyers are like, hey, everybody's telling us we're not going to need developers anymore. And so I go, well, that's A, it's wrong, and B, I want to tell you what, it's right. I just organized a virtual,

just a four-hour virtual conference. We had something like 22,000 people sign up. We told the story of why AI actually still requires programmers to change their job, which of course for our business is a good thing because they actually have to learn new skills or double down on skills that we're undervaluing. Chelsea Troy, for example,

is one of our computer science professor and one of our experts who does stuff for us on the platform, gave this fabulous talk and he said, look, we have this incredible mismatch between the idea of what a programmer does and what they actually do and how we teach them. We try to teach people to write code from scratch. Then once they get out in the real world, most of their work is actually

fixing code that was written by someone else. Now, with AI, maybe it's gone from 80 percent to 96 percent. But it's not as big a gap as you think. We've always had to teach people the skills of how do you actually think through a problem? How do you actually figure out whether the code is doing what you thought it should do? Again, one wonderful quote from a friend in the past,

a guy named Andrew Singer, told me this wonderful line once. I was working on a manual, it was the first C compiler for the Mac, think C, it's called Lightspeed C originally. Andrew dropped this line which I've treasured. He said, the skill of debugging is figuring out what you really told your program to do

instead of what you thought you told it to do. And you think about that. What did you really tell your LLM to do? It's still true. You've got to figure out. And we've got this wonderful piece recently by Philip Carter, the honeycomb, who wrote about LMs of weird computers. We now have two computers really,

two full computers that have to be brought together. One of them can write a sonnet but can't do math, and the other one can do math but can't write a sonnet no matter what you did to it. Programming is now getting the best out of these two systems, not just one. So it's like this amazing time to be helping to figure out what does programming look like today? What can we do with these machines?

And I'm super excited about it and we're figuring it out and teaching it. I love that. Oh my God. I used to laugh that people are paying me to write the code and then to fix it. So I was like, I'm being paid twice. This is really cool. But I think there's also an element of the engineering piece is what helped me understand logic for product management and architecture and business and combine. So I think there's a myth. Like I think people are overreacting right now. So I'm with you there.

So, Tim, maybe last, what would be something that you wish somebody told you earlier in your career? I wrote a piece on LinkedIn many years ago called How I Failed. And there were a set of things that I put in there that I learned too late. One of them was that as an entrepreneur, you need to value the financial people.

I know a lot of entrepreneurs who fail because they don't pay attention to their numbers. That started as me and I learned the hard way. Yeah. I tell some stories about things that because I didn't do that well enough, you know, I had to make suboptimal choices because I had not given myself the optionality. So get a great CFO until actually she's no longer my CFO, but a woman I hired in 2000, I was always the best financial person in the company. You know, my CFOs, I was, I would go, Hey, there's something wrong with that number. And they go, why?

And I go, well, because I had developed my own financial reporting system. And a lot of it was like, what percentage, every expense, what percentage was it of total sales? And so I could see the pattern. Again, it was a pattern matching thing for me. So I go, wait. So I go, there's something wrong with that number. And they would say, how do you know?

And I'd say, well, because normally,, there's something wrong with that number. They would say, how do you know? And I'd say, well, because it's normally, it's 0.35 percent of sales, and suddenly it's 2 percent of sales. So you either have an error or something happened. You need to tell me what it is. Finally, I got somebody who was better than I was. I went, great, I don't have to do that anymore. I used to literally carry with me at all times

this set of financial reports because I was always because I was the one who had to really be monitoring the health of the business. So hire people who compliment you. So that's probably one of those big pieces of advice. And the other thing, and this is probably more relevant for me as an entrepreneur at my age, you have to understand that at some point you're to have to let go one way or the other. So you have to think about succession, you have to think about who takes up the reins from you and how to teach people to do what you do and all those kinds of things.

Well, especially when it's your baby. But that's incredible. Like it's such an empire and so much legacy. I wouldn't call it an empire. I would call it a small island nation. Well, as far as I'm concerned, your camel, you know, built my career. So, hey, I am all in. Well, that's again, one of our things that we always say, create more value than you capture. That came to us back around 2000.

I was telling a story at a management meeting and I won't name the names, there were a couple of early internet billionaires who told me that they started their company with an O'Reilly book, you know, and thanked me for it. And I was telling the story and I laughed and I said, yeah, we got 35 bucks.

Yeah, so and so got, you know, 50 billion. That's pretty awesome. Yeah, and I think it was Brian Irwin who got an event show. He said, we create more value than we capture. We immediately said, oh, that's a great slogan. It should be our goal. It should be the goal of every business to create more value than you capture. If you follow Cory Doctorow's work on enchatification, you understand that companies lose the plot

on that. They stop saying we have to create more value than we capture. The market slows down and suddenly they're going, actually, we have to take out more than we put in because we have to keep growing. And that's just wrong. We actually have to keep reinventing ourselves so that we keep creating more value than we capture so that the system itself can continue. Tim, this is so, so beautiful. Thank you for sharing all of this. I absolutely love it.

I feel like it kind of rolled for it, kind of telling stories of 20, 30 years ago, but we could have thought probably more about interesting parts of the AI future, but we'll figure it out. We just have to remember that we should be using AI to solve new problems and not just to put people out of work. That I did. If you did, please share it with friends.

Now also if you're feeling stuck or simply want more from your own career, watch this 30 minute free training at leapacademy.com slash training. That's leapacademy.com slash training. See you in the next episode of the Leap Academy with Ilana Golanshchuk.