Episode 55: Beginner’s Guide To Startups Part 4: How To Get Funded, with Evan Baehr

The fourth and final installment of the startup series features Evan Baehr, Cofounder of Able Lending and Coauthor of the bestselling book, “Get Backed: Craft Your Story, Build the Perfect Pitch Deck, and Launch the Venture of Your Dreams“.

Evan lays down the essentials that you need to think about when you are preparing to ask someone for money. He provides some tools and tips that can help you find the right investor(s) for you and your team, and how to get to that crucial point – meeting with investors.

Evan also talks about why he thinks that business plans are dying out and how the pitch deck supplants it.  We dive into some of the pitch deck building blocks.  Evan stresses the importance of storytelling when the time comes for you to pitch.

This episode sponsored by Praxis and the Foundation for Economic Education.  Check out FEE seminars to learn about economics and entrepreneurship this summer!

This and all episodes are also available on SoundCloud, iTunes, YouTube, and Stitcher.

Above the Fray from Beneath

The infantry advanced,

The artillery it rumbled. 

A Great War was raging

Even stout hearts now they stumbled. 

Low on the battlefield

Beneath the trench and wire

Stood this tiny order

Surrounded by blasts and fire. 

Upon it emerged one

Too small to see at first glance,

Not possible to hear,

Calmly speak as bullets danced,

“You’re clearly dangerous,

Though that will not deter me.

I will carry on here,

Your fued does not concern me.”

So on that bloody day

But one maintained his honor.

To choose one evil side

The anthill did not bother.

And when the smoke had cleared

A sea of great things killed,

Just one thing was created,

What the ant did build.

How the Internet is Like Language

The power went out, and with it the WiFi, for four hours the other day while a pole was being replaced and again for an hour today while the A/C was being fixed.  It was almost overwhelming how lonely and isolating it felt.

Before you think me too dramatic let me say that we’re currently in a rental house in Ecuador, in a neighborhood that still consists primarily of empty lots or newly constructed but not yet occupied houses and we’re 45 minutes from the nearest city and without a car at the moment.  None of these things feel isolating when the internet is working.  (As an aside, the WiFi here is better than the best I can get back in South Carolina.)

It’s not that I spend all day on the web.  The bulk of my work requires internet and I do use it heavily, but there are many hours every day where I’m reading, exercising, playing with my kids, eating, preparing food, sleeping, or just relaxing when I do not use the internet.  One would think a few hours without WiFi would simply let me switch to one of these activities with no mental stress.  But it didn’t work that way.

The minute it went down I felt trapped in a desolate place, separated from the world.  Not because I wanted to do something specifically requiring the internet at that moment, but because I didn’t have the option.

WiFi provides a kind of invisible psychological ether that connects me to all of humanity.  Just knowing it’s there, at the tip of my fingers through my smartphone, gives me a profound spiritual sense of connection to all mankind and to great ideas and facts and images and more.  It is the subtle substrate that makes me always a part of a network or community, even when I’m quietly reading or sleeping.

In Ecuador we’ve had experiences where we were nearly incapable of communication with the other humans around us due to my deficiency in Spanish and some Ecuadorians rapid speech.  In our current neighborhood there are many French Canadian expats who speak not a word of anything but French.  At times a feeling of fear and disconnection can sweep over you when you realize you cannot share ideas with any of the people around you.  What if you need something?  What if you just want to chat and aren’t up to the exhausting task of sign-language and hackneyed Spenchglish?  You’re stuck on a (metaphorical) island, surrounded by people but without any connective tissue.

The parallels between these experiences are striking.  Geographic proximity and physical presence do not connect us with our world.  Information and a means of exchanging it do.  That is the task language performs.  The internet performs it even better.  It can instantly translate between languages, among its other wonders.  The web is like a performance enhancing drug for language.  It exponentially increases the idea sharing power of words.

This silly idea that the internet and social media have somehow severed human connections or weakened community is an absurdity espoused by those blind to the world around them.  It’s no less ridiculous than claiming, “People used to really connect before language was invented.  Now all they do is constantly stream ideas back and forth with sound waves.”

It’s not even the speaking or web browsing.  It’s knowing you can.  What a powerful connective web for the human race.

What I Learned from Writing Every Day

A few years ago I started blogging every day.  Then I stopped to focus my energy on launching Praxis (so I told myself).  My productivity and happiness began to lag so I started daily blogging again.  Then I stopped again because I wanted to take the time to write more long-form pieces (so I told myself).  My productivity and happiness began to lag again so I started again.

The first stint was six months of unbroken daily blogging.  The second stint, after a six-month hiatus, was a year of unbroken daily blogging.  I just started up again after less than a month off because I couldn’t stand it any longer.

A few of the more valuable things I’ve learned from the practice of daily blogging…

Selfishness

Seems like it would be impossible to have something to write every day.  In fact, it almost feels arrogant to try.  The voices inside began to mock, “Oh sure, everyone really wants to hear what you have to say every single day!”  If I get stuck asking what everyone (or anyone) else wants I’ll never produce anything.  Not happiness either.

I shut out the voices by reminding myself that I write because it changes me.  I don’t write as a mission to the world or a gift to humanity or a calling card for business or to impress my wife (lord knows that doesn’t work) or to prove my point to anyone.  I write for me.  I write because doing so every day makes me more of the person I want to be.

Self-Knowledge

Writing for me might overcome the internal objection to posting my ideas daily, but it doesn’t solve the need for content.  Every day blogging means I’ve got to have something you want to say every day.  It’s not as hard as you might imagine.

I think everyone has plenty to say.  Most of us just don’t know what’s in our own heads until we’re forced to get it out.  How many thoughts go through your head every day?  Brain researchers claim upwards of 50,000, plus all the things you dream.  You make observations, form theories, develop insights, and share many of them in conversation.  You just don’t know it.

Writing every day has taught me more about myself and what ideas are bouncing around in the attic of my skull than any practice I can imagine by forcing me to give them voice.

Killing the Critic

Something weird happened when I started writing every day.  My capacity for lazy criticism damn-near dried up.  When I read articles or watched movies I rarely found myself tossing out unbacked claims like, “That was lame”, or, “What a weak argument”.

The casual signaling of disapproval that passes for commentary is a brain-rotting, happiness-and-creativity-killing habit.  I was good at it.  Daily writing put wrench in my call-outs.

This happened for two reasons.  First, I need content!  Watching a movie I don’t like and sharing my reaction in a simple Facebook post declaring, “Meh” is like washing your hands with the last liter of water in the canteen while crossing the desert.  I need fuel to feed the daily writing and my brain just processed an entire two-hour spectacle full of ideas and implications.  Surely there is something in there that can be turned into a post!

The second reason the critic in me got neutered was simply perspective, or if you wish, empathy.  I know what it means to create something and ship it out to the world, how many or few they may be.  It’s hard.  It’s brutal some days.  And everything I create is not my best stuff.  But the pride I feel when I churn out a post on a bad day, even if I know it’s a weak post, is amazing.  When I see other people create I can’t help but internally cast a knowing nod their way.  Who cares about the flaws?  They’re doing something.  Plus, if they’re like me, they’re probably already…

On to the Next One

I don’t have comments enabled on this blog.  I never read the comments on Medium or other outlets where my stuff is published.  I rarely read or engage Facebook comments on my articles.

Before you think I’m a total condescending jerk let me just say it’s not you, it’s me.

I have nothing against comments or commenters.  I love that people want to engage some of the ideas I produce.  But I’m a pretty weak-willed person in many ways.  It’s hard enough to blog every day as it is, without the backward-looking draw of yesterday’s work.  If I get caught up reading comments I will not be able to do it dispassionately.  It’s my writing, so it’s close to me.  I’ll become vested in the outcome of the conversation, which is like being vested in Sisyphus getting that boulder to stay up there.

It also runs the risk of getting me hooked on the quick dopamine hit of a “like” or positive comment, which is the beginning of the end if I want to maintain my goal of writing for me.

I’ve learned to immediately distance myself mentally from my writing the minute I click “publish”.  Blog for the day is done.  Great.  Let’s move on.  What’s on the agenda?

This practice has been so necessary for my mental health it’s hard to overemphasize it.

Not only that, when you don’t treat your writing as so precious it deserves a week of fawning after completion it frees you up to produce lots of other things and allows you to improve as a creator much faster.  If I’m totally wrapped up in the fate of yesterday’s piece it will be harder for me to see its flaws and improve.  Or, worse yet, I might become overwhelmed and embarrassed by its flaws and never want to write again.

Instead, I tell myself to shut up and ship it.  Don’t look back, look ahead.

OK I’m done.  See you tomorrow.

Remember to Slam the Door Behind You

Don't do stuff you hate

Stop leaving doors open.  Start burning bridges.

There’s an idea that keeping doors open is inherently good.  I’ve written before about how obsession with options can blind you to opportunities.  I’m going to make an even stronger claim: Not only do you need to stop looking for so many options, you should begin actively slamming doors to ensure you can never again walk through them.

If you know a door leads you to a life that would make you unhappy shut it.

If you’ve peeked through a particular portal and seen something that makes you a little dead inside slam the door and burn it behind you.  Otherwise you might be tempted to go through it later if someone dangles the right price in front of you.  You might be tempted to say yes to something you hate, which might be the saddest of all fates.

I’ve met a number of young people who spent a summer interning in Washington, DC and told me after the experience that they hate the entire political scene and would never want to become one of those people.  Many of these same young people, when the fantasyland of subsidized education comes to a close and the need for a steady job begins to weigh on them, confide things like, “I can’t publish that blog post or I would never get hired by policy group X in DC!”  They are careful not to burn bridges, “just in case”.

But if the bridge takes you someplace you know you don’t want to go burning it should be a top priority!  There’s a reason Odysseus had himself tied to the mast.

How many people live lives they hate because they couldn’t say no to the salary?  How many wallow in misery because they left the door open too long?  How many knew a particular path wouldn’t make them happy but they failed to cut off the option and when push came to shove they couldn’t say no to the status or short-term gains in the moment of weakness?

Go try things.  Lots of things.  Be open minded before you try something.  The minute you stumble on something you hate, slam the door.  Cut off your return route.

Realistically you’re not likely to arrive at a life you love by picking the one thing that’s perfect for you and going at it.  Instead, try stuff and shut down everything that’s not it.  Arrive at the good life by eliminating the bad.  I’ve written about this frequently and it’s something of a life motto for me.  Just don’t do stuff you hate and the rest is fair game.

I have a friend who says the only reason he does what he does is because there is nothing else in the world he can stand or is good at.  It might not sound noble to you, but I think this is one of the best reasons to do something that I can think of!  Some of the best entrepreneurs admit they have to keep starting companies if for no other reason than that they hate being an employee so much.  Find what you love by getting to the point where there’s nothing else left.  If you keep slamming doors behind you it will be easier to narrow your field of options.  Eventually, all that’s left will be perfect for you.

As soon as you realize something makes you dead inside, saps your energy, or kills your joy make an escape plan and get out of there ASAP.  It doesn’t matter to where, just anywhere but the bad place.  As soon as you realize it again move on again.  It might take two days it might take five years.  It can be hard to exit a bad situation.  But when you know it’s not working blaze a trail and don’t leave breadcrumbs.

Maybe you’ll die with an incredibly wide range of things still on your list of potentially good ways to spend your life.  Maybe by age 20 they’ll be almost nothing left.  It’s different for everyone.  But if you’re like most, you never could have found your “bliss” or “passion” if you set out to or treated everything as perpetually possible.  You only find it by slamming doors on what it’s not.

This is going to sound repetitive but it bears repetition.  Don’t do stuff you don’t like doing.  Not only don’t do it, don’t even leave yourself in a position where you’re tempted to.

If you discover you hate law one month into an internship or three years into law school, stop right there.  Leaving the door open, finishing “just in case”, is the surest way to end up with a life that bores you.  “Yeah, I realized I don’t like law, but I can always fall back on a life I’m guaranteed to dislike if nothing else works out.”  If you leave yourself the option you’ll take it.

Close the door and burn it.  You know what’s behind it.  There’s no question.  Everything else may or may not lead you to happiness, but not this.  You know it sucks.  Leave the other doors open until you peek through, but not the one you know is wrong.  Knowledge of what you dislike is profoundly valuable, but only if you act on it.  Inaction – not doing those things – is often not enough.  You need to prevent yourself from ever doing them.

This is not about being closed minded or rushing to judgment.  Be open minded about what may or may not make you happy.  You might be surprised.  Take the time to try things out, don’t just look at some stupid career guide or list of college majors and claim you know what’s a good fit.  But once you’ve tested something and you really know you hate it, slam the door.

The more possibilities you can eliminate quickly the faster you’ll get to a life you love.

Fear of Success is a Thing Too

The stoic approach has a lot going for it.

Contrary to “name it and claim it”, Law of Attraction kind of practices, stoicism admonishes not to fill your head with visions of utopia.  It takes the opposite tack.

Mentally explore the worst case scenario and familiarize yourself with it.  This prepares you emotionally to handle whatever comes.  By preparing for the worst you’ll be unshakeable when anything less occurs.

It’s a valuable life philosophy for dealing with fear of failure.  When you’ve already experienced failure mentally and realized it’s not all the bad, you gain a kind of invincibility not devoid of reason and realism.  You become what my friend TK Coleman might call a “Tough-minded optimist.”

But failure is not the only fear that holds us back.  Fear of success is a thing too.

What if you launch your blog or produce your movie or sell your new product and it actually takes off?  What if you go viral?  What if you have more demand than you can keep up with?  What if people start writing news stories about you?  What if your success presents you with the decision of whether to quit your day job and redefine yourself?  What if you threaten the status quo?  What if people start suing you?  What if people write articles about how much you suck?  What if all your acquaintances start asking you for jobs and money and favors?  What if big investors want to fund you but only if you move to a new city?  What if your quiet evenings at home with your loved ones and Netflix become impossible to maintain along with your new endeavor?

If you really succeed some of these things will happen.  They are at least as scary as failure and the stoic approach might cause you to avoid imagining them ahead of time.  It’s arrogant to close your eyes and feel the experience of wild success, right?  It’s delusional and might keep you from being able to handle failure, right?

Maybe if that’s all you ever imagine.  On the flipside, if you’re only every braced for failure you might be blindsided by success and crumble, or worse yet never go hard after it due to latent fear of its unknown rewards and challenges.

One of those cheesy evangelical phrases I grew up around is pretty accurate here.  “Another level another devil”.  Maybe now your problems and fears loom large.  If you don’t get the job you won’t know how to pay rent.  Yet if you succeed in a big way your problems and fears become more, not less serious.  If you don’t land the deal you’ll have to fire thirteen good employees and they won’t know how to pay rent.  Success can be scary stuff.

If the stoic experience of mentally living through the worst-case is the antidote to fear of failure then I suggest the opposite is the antidote to fear of success.

Envision your best-case.  Envision having millions of fans or dollars.  Envision wild success and its attendant obligations and challenges.  Really, seriously explore what you would do right now if you had it.  It presents more challenges than most are willing to acknowledge.

I don’t know about the effectiveness of envisioning your goals as a way to achieve them, but I still think it’s important to envision success as a way to overcome your fear of it.

Episode 53: Beginner’s Guide to Startups Part 3: Finding Your Thing & Growing Without Investment, Levi Morehouse

Here we are with the third installment in our startup series!  This episode features my brother Levi Morehouse, founder of multiple companies and CEO of Ceterus, talking about discovering your thing in entrepreneurship, bootstrapping and getting started, along with ways to grow without (big) investment.

Levi’s view is that there are no bad reasons for wanting to be an entrepreneur, whether you want the freedom (and responsibilities) that comes with entrepreneurship, or it’s money that motivates you. What can be of help is if you know where you want your business to end up, or at least what kind of a startup you would like to embark on.

We also talk about ways of funding that you can choose from, and how they depend on whether you are ready to cut the safety rope and leave your comfort zone.

Probably the most important thing is not to wait for ‘The Perfect Idea’, but also to be confident in steps that you are about to take.

Levi very insightfully defines three types of business:

  1. Solopreneur
  2. Small business
  3. Startup

This episode sponsored by Praxis and the Foundation for Economic Education.  Check out FEE seminars to learn about economics and entrepreneurship this summer!

This and all episodes are also available on SoundCloud, iTunes, YouTube, and Stitcher.

Ecuador Update: Random Reflections from Abroad

  • The jungle is nice. Except for all the trees.
  • Hippies from every country are exactly the same.
  • Surfers do very little surfing.
  • Lines on the road are mere suggestions here and nobody takes them.
  • A “speed bump” in Ecuador is a large concrete protrusion on a major highway that, if taken at speeds exceeding roughly 3MPH, will dismantle your entire vehicle and several vertebrae.
  • Johnny Cash is a great English teacher on account of his slow singing.  Though phrases like, “The whirlwind is in the thorn tree” may have limited usefulness.
  • It is grossly mistaken to call underdeveloped living “the simple life”.  Nothing could be further from the truth.  The lack of complex market institutions means the most basic of tasks become incredibly complex.  Getting food, water, medicine, or transportation necessitate various social networks, waiting and hoping on others, massive time and know-how, etc.  Survival amid simple institutions is very complex.  Conversely, highly developed and complex institutions make survival so simple as to require no thought whatsoever.  If you want a simple life, find the most advanced capital structure and complex web of market institutions and live there.  If you want complexity move to the jungle.
  • I vastly prefer Ecuador’s southern coast to the northern coast.
  • The jungle has a very weird and slightly dark vibe to it.  I understand The Heart of Darkness a lot better than I used to.
  • WiFi travels through bamboo a lot better than concrete.
  • Bamboo might be the most amazing plant on the planet.
  • WiFi and cell phones may end up being the greatest advances in human history.
  • Few things in the world are scarier than having a sick child in a remote place.  Also the jungle makes everything scarier.
  • For $40 you can get an excellent children’s doctor to take a quick break from the hospital and come meet you across the street in his private clinic for medical care.
  • For another $10 you can get three different medications from the pharmacy.
  • It cost $70 and four hours round trip to make it to the city to obtain these medical services.
  • I grew up in a town with a totally awesome name: Kalamazoo.  I just found one in Ecuador with an even better name: Jipijapa.
  • Country folk is country folk, no matter where you go.
  • How in God’s name are there so many kinds of fruit I’ve never heard of and several that apparently have no name besides, “Kind of like an orange”, or, “Kind of like a tomato” (translation: nothing like a tomato)?
  • Never have I felt the sheer stupidity of the “buy local” concept more than as a visitor to another country where signs everywhere urge, “CUANDO VAYAS A COMPRAR, PRIMERO ECUADOR!”  As an outsider, and one who is eager to exchange with people in this wonderful place it feels even more petty, inbred, and moronic than when I encounter “Buy American”, or, “Buy local” back home, which I’ve become more numb to.  Free trade is awesome.  Nativism is stupid. Always and everywhere.
  • In many poor towns and villages the houses and land are in great disrepair yet most of the people populating them have near immaculate personal appearance.  Clean, fresh, well-fitted and trendy clothes.  Neatly cut and styled hair.  It is a stark contrast to the dwellings and shops around them.  I don’t know enough to verify, but my hunch is that it’s an excellent example of the insights of people like Peruvian economist Hernando DeSoto.  The houses and shops are in shaky legal standing with regards to ownership, therefore improvements are subject to attract more attention and cost more in taxes, regulations, etc., whereas one’s person and attire have much clearer ownership.  Whatever the reason for the disrepair, it seems clear it is not due to a lack of interest in cleanliness or improvement on the part of most of the residents.  They look better put together than people at an average Target in the Midwest.
  • Do taste buds change with latitude or is instant coffee always this good?
  • If a person who is 10% proficient in Spanish and a person 10% proficient in English can have 80% of a deep, meaningful, hours-long conversation, what are we doing with all those other words the rest of the time?
  • I’m even more intrigued by Ayahuasca than I was before.
  • My laptop has made it known in no uncertain terms that she requires A/C and she’ll throw a hissy fit if her demands are not met.
  • A word about dogs.  Yes, dogs.  The dogs here are ownerless.  Yet they are hardly “wild” in the sense you might imagine.  Never have I seen more docility and friendliness among canines.  In the nicer villages they are healthy, amiable, incredibly relaxed, and utterly harmless.  Yet I have not once seen anyone hit, yell at, or engage in any action remotely resembling training or cajoling any of these creatures.  They put the unwieldy, kid-attacking, frantic-barking, yard-pooping, crotch-sniffing, leash-straining horrendous beasts from my cozy US suburb to shame.  I do not like dogs as pets.  Yet I actually kind of like the presence of dogs wandering and sleeping in the streets here.  It seems the most natural thing in the world.  Perhaps dogs are meant as autonomous human companions, keeping away other vermin, eating the scraps at the fireplace, and lounging around the gates of our dwellings and streets of our neighborhoods, rather than enslaved to chain-linked lots with leashes and newspapers and electric fences and Kibbles and fake “walks” and alternating neglect and indulgence and dog pills and dog counseling and dog daycare?  The pet-loving people of the world act shocked and appalled at my distaste for their dogs.  But who knows, maybe I’m the humane one…

Episode 51: Beginner’s Guide to Startups Part 2 – The Investor Side of the Table, with Michael Gibson

What do investors look for in a company founder?  Do they have the easy job, just sitting back with a monocle and making or breaking dreams?

Hardly.

Michael Gibson has been involved with Peter Thiel’s programs and investments and is now Co-Founder and General Partner at the 1517 Fund.

We cover the types of investors that can be found out there, what to look for and how to approach an investor, what a startup accelerator can help you with and what to consider when applying for one. We also hit on what investors think about when they consider which startup to support and what they fear the most.

Here is the very handy “10 Slide Pitch” document that Michael referenced.

This episode sponsored by Praxis and the Foundation for Economic Education.  Check out FEE seminars to learn about economics and entrepreneurship this summer!

This and all episodes are available on SoundCloud, iTunes, YouTube, and Stitcher.

Episode 49: Beginner’s Guide to Startups Part 1, the Basics with Ant Davies

Ever wondered if you should start a company?  New to all the lingo?  Wondering why startups are so hot right now?  This series is for you!

Several-time startup founder and economist Antony Davies joins me to lay out the basics of starting a company in part one of this four-part series.

Ant and I discuss what counts as a “startup”, who should think about launching one, what documents and data need to be worked out, and how to think through your market, revenue model, and plans for growth.

Here’s a slide presentation that contains visuals for much of what we discuss.

This episode sponsored by Praxis and the Foundation for Economic Education.  Check out their seminars to hear speakers like Ant this summer!

This and all episodes are available on SoundCloud, iTunes, YouTube, and Stitcher.

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