Dan Martell is a Canadian entrepreneur and an experienced angel investor who has invested in over 33 companies. Dan is the founder of Clarity.fm, co-founder of Flowtown and founder of Spheric Technologies.
He has also been a mentor at 500Startups, GrowLabs and theC100.org. He believes “you can only keep what you give away,” and is heavily involved in many charitable organizations & community events.
In this episode Dan will be sharing with us how he got his start in business and why actually being in jail led to a completely new perspective on life. He also talks about the two magical questions to ask people that will make networking effortless. And finally, the simple way to remove all risk from starting a business through pre-selling.
And much more!
Key Points From This Episode:
- Dan tells us how he made his first dollar online and how that moment changed everything.
- How going through chaos as a kid led Dan to uncover his entrepreneurial side.
- Find out how Dan learned to code through reading books.
- The biggest lessons Dan took away from his time spent in jail and at rehab.
- Why Dan explains failure as experiments that ran too long.
- The importance of having the right people around you.
- Dan’s Dream 100 list and why he divides it into peers, advisors and mentors.
- Why being good at asking questions is a magical skill.
- Approaching the right type of people and finding a good mentor.
- Hear about Dan’s biggest failures while on this path of entrepreneurship.
- Discover what the entrepreneurial pendulum is.
- Automatic negative thoughts and the effect it has on you and your business.
- Choosing to be grateful and changing your mindset.
- Getting out of your comfort zone and setting goals that up your game.
- Developing your idea muscle.
- Three different ways to become wealthy: the artist, the manager and the entrepreneur.
- Why the best way to presell is asking for advice.
- The person that changed Dan’s life.
- Dan’s purpose of helping people and troubled children.
- And much more!
Links Mentioned in Today’s Episode:
Dan Martell — http://www.danmartell.com/
Dan on Twitter — https://twitter.com/danmartell
Dan on LinkedIn — https://ca.linkedin.com/in/dmartell
Clarity — https://clarity.fm/
Unbound Merino — unboundmerino.com (PROMO CODE: FAILON)
Portage — https://portage.ca/en/
Spheric Technologies — http://spheric.ca/
500 Startups — https://500.co/
HTML — http://html.com/
ColdFusion — http://www.adobe.com/products/coldfusion-family.html
PHP — http://php.net/
Perl Script — https://www.perl.org/
Shark Tank — http://abc.go.com/shows/shark-tank
Dragons Den — http://www.cbc.ca/dragonsden/
Airbnb — https://www.airbnb.com/
VRBO — https://www.vrbo.com/
Meetup.com — https://www.meetup.com/
Run for The Cure — http://cibcrunforthecure.supportcbcf.com/
Amazon — https://www.amazon.com/
Facebook — https://www.facebook.com/
The Five Minute Journal — https://www.amazon.com/Five-Minute-Journal-Happier-Minutes/dp/0991846206/
Travis Kalanick — https://www.linkedin.com/in/traviskalanick/
Uber — https://www.uber.com/
Mark Zuckerberg — https://www.facebook.com/zuck
Warren Buffet — http://www.warrenbuffett.com/
WordPress — https://wordpress.com/
Youtube — https://www.youtube.com/
James Altucher — http://www.jamesaltucher.com/
Richard Branson — https://www.virgin.com/richard-branson
Groupon — https://www.groupon.com/
Intercom — https://www.intercom.com/
Dropbox — https://www.dropbox.com/
Jayson Gaignard — http://www.jaysongaignard.com/
Marc Ecko — http://www.ecko.com/
Tim Ferriss — https://fourhourworkweek.com/
Oprah — http://www.oprah.com/index.html
Block Geeks — https://blockgeeks.com/
“DM: You got to be a die hard passion about it, it can hurt people because when they start it, they did it because they’re passionate about it and then they realize it’s a job and then they’re like shit, this isn’t fun anymore, it’s like look, business is not the same as being a practitioner.”
[0:00:17.6] ANNOUNCER: Welcome to The Fail on Podcast where we explore the hardships and obstacles today’s industry leaders face on their journey to the top of their fields, through careful insight and thoughtful conversation. By embracing failure, we’ll show you how to build momentum without being consumed by the result.
Now please welcome your host, Rob Nunnery.
[0:00:43.5] RN: Hey there and welcome to the show that believes embracing failure and sharing your honest struggle is the only way to achieve your dreams, in a world that only likes to share successes, we dissect the struggle by talking to open, honest and vulnerable entrepreneurs and this is a platform for their stories and today’s story is a good one. It’s of Dan Martell, if you don’t know Dan.
Dan’s an award winning Canadian entrepreneur and has exited three different venture backed startups. His most recent being Clarity which is acquired by startups.co. In 2012, he was named Canada’s top angel investor having completed over 33 investments with companies like Udemy, Intercom and Unbounce. We’ll be discussing how he got a start in business and why actually being in jail led to a completely new perspective on life.
The two magical questions to ask people that will make networking effortless and the one simple exercise to take to get out of a rut when you are feeling down and obviously much more. But first, I haven’t been traveling as much as I typically do lately but it hasn’t stopped me from wearing my new favorite shirt.
It’s a shirt from an awesome Toronto company called Unbound Marino. They have clothes and apparel made out of Marino wool and get this, you can wear them for months on end without ever needing to have it washed. Yes, I said that. This is a traveler’s absolute dream, it’s a guy’s absolute dream and it will turn you into a minimalist really quickly.
You’ll never have to check a bag at the airport again, but we’ll have a promo code for you on the show notes page for an exclusive fail on discount that you won’t be able to get anywhere else so make sure to check that out. That will be at failon.com/023 and moving right along.
If you’d like to stay up to date on all the Fail On podcast, interviews and key takeaways from each guest, simply go to failon.com and signup for our newsletter at the bottom of the page, that’s failon.com.
[0:02:34.4] RN: So, sitting down here with Mr. Dan Martell. We are in Carmel, California.
[0:02:40.4] DM: Beautiful outside.
[0:02:42.1] RN: We’re sitting on the patio, we’re sitting on my patio from my room, looking out, beautiful setting of rolling hills.
[0:02:49.3] DM: It’s California.
[0:02:51.4] RN: this is it man, you came in from – you’re back in Canada now?
[0:02:53.2] DM: East coast, yeah. Or back – last time I saw you was in San Diego and then I spent the winter there, head back east and then this is about the time of year where things get really magical there.
[0:03:05.0] RN: Yeah, this is like, all the Canada friends are like, this is cottage time.
[0:03:10.2] DM: Yeah.
[0:03:10.5] RN: Cottage life.
[0:03:11.7] DM: It’s good, there’s a few months a year and then the rest of it you run away.
[0:03:14.2] RN: You go to Carlsbad.
[0:03:15.5] DM: Yeah.
[0:03:17.2] RN: Awesome, obviously, you have Clarity and Flowtown that you sold, I want to jump into all that stuff and I want to jump in to what you’re doing now with Danmartell.com but first, just for some context, let’s go way back to the first time that somebody actually gave you money in exchange for a product or service that you created?
[0:03:35.3] DM: Yeah, I will say, I’ll go to 17, I mean, when I was a kid, I used to rally the neighborhood kids to build tree forts and snow castles and charge other neighborhood kids that didn’t help out, 25 cents play. I guess, at a young age, you could say I was into real estate but I think the more interesting story is when I was 17, I went through a lot as a teenager.
I had a pretty colorful upbringing, short story is, I ended up in jail twice, rehab at 17, discovered programming through this book I found on java, programming and when I got out, that became my new addiction and the first thing I ever sold way –
My dad had a cottage, he used to rent for a few weeks out of the summer and he was just sick of answering the same phone calls all the time of like, “Yes, it’s free these weeks, no, we don’t allow,” you know what I mean?
Back in the day, before the internet, people had to call to get these same questions answered and he asked me, he’s like “Hey, could you build me these web pages” in 97/98 and just occurred to me that there could be other people like my dad.
I told him, it would cost him 200 bucks and he was like, “Why is it 200 bucks” and I’m like, “That’s how much it costs” and the truth was, I needed the servers because I want to build something a little bit more elaborate and first thing I ever sold, I got a tourism guide, I had built it for my dad, got a tourism, it’s called maritimevacation.ca, it was a vacation rental site which you’d think it would be a 10 billion dollar idea in today’s market but this is a few mistakes made along the way.
I took all the addresses and I didn’t even know anything, I just did it because I was like, “of course, this is how I’m going to reach them,” I just got my little brother Moe, paid him like three bucks an hour to sit there and type in all the addresses of these bed and breakfasts and cottages into a Microsoft Access database, mail merge that in Word to a form letter essentially sent that out with some page that said “Hey, we’re maritimevacation.ca.
If you want a listing online for your cottage or BNB, just fill out this form and add three pictures and then we’ll send you.. and $30” and I sent it out and not like – you know, I was like, maybe somebody will call or whatever and like two weeks later, my dad came back from work and he picked out the mail and he had a stack of envelopes and he’s like – he just looked at me and said, “What did you do?”
I was like, I started opening them and like people sent cash. I’m like –
[0:05:53.5] RN: It’s in the mail?
[0:05:55.1] DM: Yeah, I was like, “What?” If I worked in the mail, I’d be like, sitting there with a light and be like, “There’s a cash envelope” and that was the first time I ever made a dollar online from somebody that wasn’t like a cousin, a brother or a friend and that changed everything.
That was like, that moment for the rest of my life will go down as like, “I can do this.”
[0:06:15.6] RN: Changed everything right?
[0:06:16.2] DM: Everything.
[0:06:17.2] RN: The mindset just like, “Holy cow.”
[0:06:19.5] DM: It was crazy because people take it for – I literally, today, I’m still in awe of the fact that I can build something and anybody in the world that has the internet can see it. My dad worked at Siemens and this like manufacturing electric mortar stuff and like, I don’t know what he did, I never saw it. My kids can go use the products I build and I could share with anybody.
I find, that’s just – I’ll never take that for granted. That moment was when I was like, “I could actually see myself doing this as a thing.”
[0:06:51.9] RN: What actually gave you that mindset starting out, initially, having that idea and putting together and starting to pay Moe, start typing an addresses, what actually got you there?
[0:07:00.9] DM: Well that’s being lazy.
[0:07:03.9] RN: That was called delegation Dan.
[0:07:05.5] DM: Yeah, that’s my family wondering I was so lazy my whole life. I mean, I’ve always been somebody that likes to create, I literally just, I’m – unfortunately, most of the things I wanted to do weren’t legal or you know, convincing my friends to go steal their parent’s wood so we could build like tree –
There was no filter either, that’s the other part, it was kind of like, “That makes sense, I know we shouldn’t do this but I think the upside will be a lot of fun” and I was always, you know, fairly good at convincing people to kind of join in the journey.
You know, when all of a sudden now there was money involved and I realized you could take that and then buy other stuff and make it better and reinvest and that was the unlock and it definitely took me a lot more time and years and failed companies to finally figure it out but that was the beginning and the seed.
Just realizing that I could create things that other people would want to pay for.
[0:08:03.6] RN: You got the stack of envelopes, money in it, where- did that project go anywhere else, did it go further?
[0:08:10.3] DM: No, what happened was, I think we got like 40 something listings and you know, we ended up doing some advertising stuff so we got about 20,000 the first year but I mean, I built it for my dad, I was not passionate, I literally just needed something to work that was real.
I was writing code but it wasn’t like – it was just like stupid stuff, I built this app that allowed my friends to build list of songs. If you had a CD burner back in the day, every person would come to your house and sit on your computer, try to build their fucking playlist for their girlfriend or whatever.
I built like this app that connected through FTP to connect to my computer, get the updated – saw the download from Napster, they could create their CD and it would like send over the order and I could hit a button and it would burn at night.
I built things for myself but then it was like – “I can build stuff for other people.” Maritime vacation wasn’t just passionate and the truth was I called it maritimevacation.ca which was a total market about 200 cottages and the guy at the cottage.com had a better name and more professional business mind.
Even though I got my little brother Moe to do some stuff, I still didn’t understand the concept of a team. I was 17 you know? Not too hard on myself but yeah, kind of let that one wind down over a couple of years and then I came out with another idea about two years later, called MB host because I started building sites for other people and anybody’s done any consulting on the web, dev side. “You should do a hosting company.”
Well, that’s the dumb– any life whatsoever, you don’t do web hosting.
[0:09:35.9] RN: Well, it sounds like your dad was – he had a job at Siemens. Were you raised in this entrepreneurial – it doesn’t seem like it.
[0:09:42.7] DM: No, I’ll say this.
[0:09:44.8] RN: Were you just cut from a different cloth or…
[0:09:44.9] DM: A few things, definitely the black sheep of the family, I’m the second oldest, I have a sister and two younger brothers. My dad had a few rental properties so he did understand business, he was the general manager and he had like, he was a sales guy so I learned a lot about business negotiation, deal structure.Being in the car as a teenager, as a young – you know, eight, nine year old.
The risk side didn’t come from my dad. My dad calls me today and says, “Dan, I have a deal,” “I don’t need to hear another word dad, I’m in” because he is the antithesis of anti-risk. I love him for that because if you show him something, he’s like, “That’s a good idea,” it’s like super good.
[0:10:27.2] RN: 110, it’s way too good.
[0:10:30.1] DM: Everything I’ve ever done in my whole life, he still doesn’t get. He wouldn’t even touch it. Yeah, it wasn’t that – I just think the entrepreneur side just came from going through a lot of chaos as a kid and I really believe that people that have had success usually have some chaotic moment, sometimes it’s a parent that pass when they were younger or certain situations just teaches them to deal with uncertainty and it turns out that other than being an entrepreneur, it’s hard for me to be anything like, I’ll get fired.
I remember, I had a job for like 11 months, that was the – I couldn’t do it. The first thing I did was figure out how I could get all my work done in two hours and play Unreal Tournament for the other six. It was so funny, I got like a screenshot of a Word doc and I could alt tab to the image. I’d be playing the video game and alt tab and my screen – if I heard anybody coming behind me it was like “boom.”
[0:11:24.6] RN: that’s great, yeah.
[0:11:24.6] DM: That’s the kind of stuff I would do as an employee and then just too opinionated and always seeing the opportunity to do something better and I just felt like a hypocrite. People are like, “You should do this better.” So I’m like, “Why don’t I just do it for myself?”
[0:11:35.2] RN: Yeah, exactly, that’s interesting. I had the same feelings when I had a job. Looked at as kind of unruly and has an opinion on everything.
[0:11:44.5] DM: Totally.
[0:11:45.2] RN: Telling them to change this, why are you doing it this way, no employer wants to hear that.
[0:11:49.4] DM: No, they’re like,” I know these things are broken, can you stop making it painfully obvious?” “Do something about it,” it’s like – then a point, you look in the mirror and say, “Why am I not doing something about it?” You know, that’s like – I guess I’ve always had that self - I can’t be a hypocrite. That was a big part.
[0:12:06.4] RN: What gave you kind of the – I’m just thinking, lot of people that are going from this spot where – it might be a shift from a job like a nine to five job to starting a business or wanting to do any kind of creative venture. For a lot of people, it’s risky, talking about risk. What allowed you to have – were you living at home, were you – did you have money in the bank, what gave you the freedom to actually do these projects and trials?
[0:12:31.3] DM: My dad’s my hero, he – after I got out of rehab, it was a big shift you know? I mean, I actually was in jail, got released early, went to rehab for 11 months and had to rebuild my relationship with my family and my dad moved into a new neighborhood just so I could change schools. I have this huge admiration and really.
He saw – I mean, for my whole life, he’d always say things like, “I just wish you find something you’re passionate about that wasn’t illegal.” He would say that to me all the time and I’d be like, “You and me both, I don’t know. I just like to do stuff.”
[0:13:03.3] RN: He could probably see how powerful you could be if you just directed it.
[0:13:05.3] DM: That was the thing, I remember one time, he tells this story where like he asked me to help him with some renovation on the cottage, we’re putting in a wall and everybody else, it was like this weird hard wall that you had to kind of like nail through and everybody else was smashing their hands and I go and grab a plier and I’m holding the nail with the plier and smashing with a hammer.
He’s just like, “Why are these six other people sitting there trying to bang their fingers with this hammer and Dan just grabs a plier, clamps on, just cranking,” he just knew I was always kind of like creative problem solver I guess.
I just – the first companies, when I got into computers, he brought me to the book store and he said, “I will buy you any book but one at a time and you got to read it.” That was how I learned to code.
It was just one at a time, he had an unlimited budget so I owe him a lot for the beginning and then after that, I just was never a big spender and I would just save my money. I was making - the first job as a consultant through my company, when I was 22, I got working for an oil company and I was making $150,000 a year driving a 1987 Jetta and I was totally content with that.
That was the seed money that I used to start my next company. Before that, the hosting company I did with my brother, we each put in 10,000 line of credit. I just threw down, I don’t know, I guess – again, the risk side for me, knowing what I did as a teenager and the shit I put myself in, and the situation I put myself in, the business risk was like on a level that wasn’t even – different playing field.
I feel lucky and blessed that that’s kind of my experience. I’ve never had an issue with throwing down if I felt like my soul and my gut was there and speaking to me. Always – I’ve always felt the world rewards courageous decisions.
As long as I always feel like these are – they’re sensible, they’re going to push me and I just trust in the process, they seem to work out.
[0:15:24.6] RN: Obviously jail and rehab, what’s the biggest lesson you took away from that?
[0:15:30.3] DM: Tons of stuff. I mean, on the jail side, I think, you know, for the longest time, growing up, I was diagnosed with ADHD when I was eight, put on Ritalin, I got two little kids now and I just can’t even understand the logic behind that. I thought I was broken for my whole life. I grew up in this kind of like –
It was almost like the cyclical negative reinforcement of I felt broken, I would act out, everybody would say I was a bad kid, all of a sudden the neighborhood kids weren’t allowed to hang out with me, we’d go in the woods and then I’d be trying to get them to do bad stuff because I was supposed to because that was kind of my role with the - yeah. I guess the big thing is, the power of the people around you.
Literally – it’s so hard to get out of that hole if you’re spending time. How do you do good when you’re in a jail cell? I try, this is my second time, I went in when I was 15 for drug related charges and assault. The second time, I got sentenced for nine months and I was like, “This is different, I’m going to try” and I really tried and I got in a fight three months in.
Just the power of proximity around the influence of the people around you, that would be the biggest one for that part. Then I went to this incredible place called Portage that was essentially a therapeutic community in the middle of like, literally something like we’re looking out here in these mountains.
It was so far out of normal reach of any town. If you saw a kid walking, hitch hiking down the street, everybody knew it’s like – you just walk for two hours and finally give up and go back. This happened – I did it a couple of times, everybody did it.
You got to a point in the program where it’s like, “I’m out of here.” “Okay, bye.”
[0:17:13.9] RN: The end, see you in a couple of hours.
[0:17:14.8] DM: It’s raining, I’m going to come back. I would say that place just taught me about what made me tick and emotions and things that I had buried and stories and –
[0:17:27.9] RN: Was it rehab for drugs?
[0:17:28.8] DM: Yeah. I’ve been sober since 17, I’m 37, 20 years.
[0:17:34.7] RN: Nice man.
[0:17:35.3] DM: Yeah.
[0:17:36.3] RN: It’s an early lesson, I mean, at 17.
[0:17:38.8] DM: I am so, I cannot – it blows my mind that I got to learn those lessons, even adults going through that program would come out a different person because I had – I mean, just – I got to learn from the other people, what was different about this place that I’m lucky for.
Probably why it worked for me is all the other staff, that the adults were all ex-drug addicts. That was how it was created was like this philosophy of, positive peer pressure of people have been there, done it before which is the basis of great entrepreneurship which is mentoring.
I mean, I learned this at 17, I learned at 17, you’re supposed to find people who have done it before.
[0:18:13.8] RN: It’s a huge lesson.
[0:18:14.1] DM: I know. I’m like that, I just started applying everything I learned there and some of my street level business acumen stuff I do when I was 15, 16, that you know, when I got into business, it just translated in a really powerful way.
Those would be the biggest lesson. Almost the EQ side of the business, emotional intelligence, I had, at a level of 18 where – I mean, I sold – the third company I did Sphere Technologies. I was 24 when I started it and we sold to fortune 500 companies. I’m selling the CTO’s of fortune 500. I didn’t even have a clue and it’s just because I had the EQ to have those conversations, understand their needs, to communicate in the benefits, not the features or geek out on my own – what I thought was neat.
Really understand, like this is like putting myself in their perspective and that’s why the company worked out.
[0:19:05.9] RN: Moral of the story is, hit the streets at 15, start doing drugs…
[0:19:10.9] DM: Scare yourself every day, hopefully doing legal stuff and be comfortable with the uncomfortable.
[0:19:18.7] RN: Obviously, The Fail On podcast being what this is, how do you actually define failure? Because obviously you’ve had a lot of ups and downs on your journey.
[0:19:27.5] DM: I think failures are when you made a decision that backfire twice. You know, failure to me, there’s a cliché, failure’s – literally, if I didn’t learn my lesson the first time, that was a failure. If I had a challenge and I didn’t get through it but I learned from it and I don’t put myself in the exact same scenario, game on, awesome opportunity.
I really think, you know, failures are just experiments that ran too long.
[0:19:58.5] RN: On that note, a lot of people say quitting is failure which, not always right?
[0:20:03.3] DM: Not at all man.
[0:20:04.8] RN: Because sometimes you need to quit because it’s not the right business.
[0:20:08.4] DM: I would say, again, failures are experiments that went too long. Not quitting soon enough when you had the data to create the room and the space in your life to go discover that next thing, that’s just crazy talk.
[0:20:20.3] RN: On that note though? What’s a good – how do you measure that? How do you measure like, how do you get to the point where you know “Okay, this is not working,” this data to some extent.
For somebody that’s maybe starting a project and they’re not getting much traction. How do you know where that line is because on the same note, people always say, “You’re three feet from gold.”
[0:20:39.2] DM: Yeah, you know what? Especially in the tech world or where I come from, there’s all this like – “I got a thousand no’s or I got a thousand lessons on how not to do it and I kept going.” Look, there’s some theoretical underpinnings of things, there’s a level of intelligence like if you have a good set of advice, I always think of mentors.
People that I think the biggest challenge people have is they make decisions based on what they think their immediate peer group will think. What I do in my head instead is think of the people I admire right? It doesn’t matter who that is for you, just you know those people, maybe never met them, you read about them, whatever. Think to yourself, if I make a financial decision, I ask myself, “What would Warren Buffet think of that decision?”
I can say to myself, “I think he’d be proud or he’d feel good about that.” That’s a great filter right? When I was designing my product at clarity, my last company. I literally would think, “Would Steve Jobs be impressed with this? Is this like, is this beautiful, is it simple? Is it elegant or was it just meh?”
I really think that if you’re doing something and you’re not seeing the results but you have people around you that have been there and they’re saying, “There’s something there, keep going.” You know, it’s not just as blind stubborn – because you all see those guys on Shark Tank or Dragons Den in Canada. It’s like, they come out with this board games and they’re like, the sharks go, “How long have you been working on that?”
He’s like, “27 years.” “How much did you invest on that?”, “$130,000, my whole life savings,” he’s like, “Okay, here’s what you’re going to do, you’re going to go in the back lot and you’re going to burn this thing, you’re going to never talk about it again.” Yeah, there’s those – people sometimes act as like they’re on this path of dealing with no’s, it’s like, don’t be an idiot.
I would say, for me, that’s what I do. I have a group of kind of like, really successful people that I admire, not only just the business side but even the way they show up in their life and their family and stuff. I go to them, if I feel like, “Hey, I’ve been like trying to crack this problem, I just can’t seem to figure out,” they go, “You know what? I think you’re on the right path and just keep at it.”
If they go like, “Man, Dan, I know you’re passionate, I know you’re smart, I know you’re tenacious but that specific thing, I really don’t see it” or go test this. “Okay, who do you think your core customer is?” Well, this came to me. Okay, go try to presell, go try to get them to join your adviser board. Do something that if the market’s not…
It’s not about – see, that’s the other thing. In tech, you can be early and be wrong. I know this because I’ve been doing it long enough that that’s a real thing. You may not be wrong directionally speaking, the timing’s off. Maybe Maritime vacation was the wrong timing because you got Airbnb and VRBO and all these different sites today.
You know, the timing really matters and I think having those people around you. Just building in isolation is probably the dumbest thing you can do. That would be, if you said, “How do you avoid it? Build in isolation.”
[0:23:39.4] RN: Proximity’s been a big- proximity to people.
[0:23:42.1] DM: It’s everything man, why we’re sitting here. This.
[0:23:45.0] RN: In a negative way and a positive way like you said, when you were a teenager but it’s super powerful.
[0:23:49.1] DM: For me anyways.
[0:23:50.0] RN: no, I think, it’s been the same with me. For somebody that’s listening that doesn’t have, they’re not surrounded by people doing stuff that they want to do, what’s the best way to one, kind of elevate your network and then two, how to actually find a good mentor?
[0:24:05.4] DM: Yeah, I’ll answer. We’ll go mentor second. First just your peer group. Because I really think it takes three things, you get your peers, your advisers and your mentors. I call it a Dream 100 list. I actually, every time I create a business, I open up a spreadsheet, I create three tabs.
Peers, advisors, mentors. It’s a 60/30/10 split. I’m a super systems nerd, you can probably tell just by giving that answer. He got OCD, I’m not even that organized, because I’m so disorganized, I have to create this systems in my life.
Peers are people that are on a shared journey, okay? Usually people who are two to three years ahead of where you want to be and we’ll talk about how to find them. Advisers are people that have experience or knowledge around a domain and you know, accounting, operations, logistics, procurement, whatever it is.
They’ll come into your life to help answer one off questions then your mentors are literally, I call them people you turn to instead of your parents. For the big life decisions, these are the people that are like, “Should I move, should I start this business, should I bring in a cofounder, should I raise money? Should I go university or not?” That’s what a mentor does for you because if you aspire to have a better, bigger, more interesting life than your parents which most kids do.
Then it makes no sense whatsoever even though you can love them and they love you to ask them for advice because they’re going to give you the same advice they would use themselves because that’s the life they got.
[0:25:21.7] RN: 100%.
[0:25:22.0] DM: You know what I mean? It’s so lovely, nobody listens and be like, “I don’t agree with that.”
[0:25:26.6] RN: It’s so logical though.
[0:25:27.3] DM: It’s super logical. Once you know that, you can’t un-know it. Now you know. The peer group, the way I would say is in every city, there is an entrepreneurial community and I grew up in a town of 100,000 people.
You might live in a town of 600 people but it’s the guy that owns the car dealership, it’s the guy that owns real estate place, the guy that owns a carwash, the guy that owns the buildings. They’re there okay? The funny part is that, sometimes they don’t want to be known but they’re there. Now, in this world of entrepreneurship is cool.
20 years ago when I started, it was like, if you’re an entrepreneur, it means you’re dumb or stupid or you didn’t know what you’re doing, literally, it wasn’t a thing. Today, you could go and you could go on meetup.com, you can find any local like entrepreneurial groups, you can go to – there’s a bunch of like, entrepreneurial events.
Just search entrepreneur events, business events, marketing events, networking events and just start going and socializing yourself and just kind of meet people and you know, you’ll know when you talk to somebody if you’re like, “man, I like this person, I could see myself being friends with him.”
Then you just really just say, “hey man, can I get your card? I’d love to stay in touch and you know, I’ve been trying to think of a new idea of pursuing, could I email you from time to time?” They’ll say yes because there’s not a lot of that right?
[0:26:40.8] RN: On that note, we talked about comfort zone earlier, that’s going to be uncomfortable for a lot of people.
[0:26:44.2] DM: Is it? It’s so funny because I get excited thinking about that.
[0:26:46.9] RN: Yeah, for me, going to big group settings where I don’t know anybody, it’s intimidating.
[0:26:52.7] DM: I’ll tell you, okay. Then here’s what I’ll tell you to do, get really good at asking questions, have your go to questions, make it three questions and the best one is, “what do you do?” They’ll answer but this is the key, this is the fall out where we listen to this and this is magical.
“How did you start that business?” “What got you into that?” “That sounds interesting, how did that start?” You know? “Where did you even come out with that idea?” That will unlock every entrepreneur.
[0:27:16.6] RN: Take a seat.
[0:27:18.8] DM: All right, sit down, this is a good story. Every entrepreneurial story is a great story because it never works out the way it was supposed to. I think, if you can just master the “hey, what do you do? How did you start that” and just curious – and this is another one of my favorite ones.
“Who were some people along the ways that really helped you with that?” Then you give them an opportunity, it’s almost like, it’s kind of like an inception, it’s a Jedi trick because you see what I’m doing right?
[0:27:44.6] RN: Yup.
[0:27:44.8] DM: You're essentially planting in there, you’re getting them to go, “You know what? It was my uncle.” You could ask question like, “Who is that person that believed in you?” That might sound a little much but I ask that all the time because then, you’re opening up in their mind, those people that they’re grateful for and you’re sitting across the table from them.
It makes a logical sense if you go like, “Hey, do you mind if I ever” – they’re going to go, “I got to say yes now because you just made me tell you about my uncle Bob, it wasn’t for him, I wouldn’t be here so maybe I’m your uncle Bob in this scenario.”
I would say, yeah, if you’re anxious about that. I think really, just being good, even if you’re an introvert, being good at asking questions is a magical skill. That’s the group, the peers, I’m going to tell you mentors because I really think that people make this way too complicated. It’s two filters.
One, I use the list of people that won awards, entrepreneurial awards. I mean, if you don’t know, you can go to ink 5,000, you can go local entrepreneur award, you’ll find, in every city, in my town, it’s rising stars, you can find the local list of, you can go – I even emailed the business journalist in the newspaper and ask them to give you a list of the 25 companies that they’ve talked to in the last 12 months that they were fascinated with.
They know, because they write the stories. That’s another trick. You get the list but then here’s the key, try to find out what’s the cross reference between those people and the nonprofits that they might be involved in. That’s the key.
Because if you can find, or you can just go to nonprofits themselves. The hospital nonprofit, the Run for The Cure, whatever it is and then see who’s on their board or advisory board that’s an entrepreneur. That’s a layout, that’s like, there’s such a good person. You know what I mean?
[0:29:23.2] RN: If somebody gave me that advice when I was 17, it would have been a different life, different road.
[0:29:29.8] DM: yeah, way quicker.
[0:29:30.2] RN: Let’s go to what you would consider your very first failure in the world of entrepreneurship?
[0:29:36.8] DM: You want the first failure? I mean, there’s so many. I want to give you guys a big one, I’ll give you one that really stung.
[0:29:47.9] RN: Well, it doesn’t have to be first, just the one that’s been like –
[0:29:49.9] DM: Yeah, I’m going to give you the one where it’s like, I will never make this mistake again and it was, well, there’s two that come to mind, one is when I was able to build my company Sphere where we’re a consulting company and we brought on a partner.
Because we had this very specialized technology that we’re great at. We found a company in New Jersey and they had a bunch of really big customers and they needed us. They brought us on as a partner and we partnered with them and it was really great.
You know, the CEO kind of became like a pseudo mentor but at the same time, there was a business relationship but I kind of was like, open to his advice and I was very curious. We just kept growing and he kept getting more projects, more people on our team. He one day brought up the fact that he was interested in maybe kind of like acquiring us.
I was like “Wow,” two years in, I was like, “I can’t believe they’d want to acquire us.” I talked to my dad about it because as I said, he thought it was a good idea, it was a great idea but he gave me this good advice and he said, “How much of your business right now is with them?” I said, “Probably a third.”
He told me this really great story, essentially it was a fable but it wasn’t a fable but I’ll tell it like a fable. It’s just, essentially, the idea is that there was a company once that started working with this other supplier and this technology and they got really busy and they started doing more work with the supplier.
Eventually they want to buy them and they went to and said, “You know what? It’s been our most profitable year, working with you guys have been great, we’re really loving to build the business so we’re probably going to keep doing that but we really appreciate the offer.”
They said, “Okay, cool.” They tripled the amount of orders. The supplier is like, “Oh my god, we’re growing so much,” so they went to the bank, they got a line of credit, they hired a bunch of people and then the company didn’t pay the invoices and like four, five months later, it got to the point where they went and insolvent and the company bought the supplier from the bank for 10 cents on the dollar.
Great lesson right?
[0:31:47.5] RN: Yeah.
[0:31:48.1] DM: My dad tells me this and I kind of didn’t listen to him and they tried to do that to us.
[0:31:53.5] RN: No way.
[0:31:54.4] DM: Yeah.
[0:31:54.9] RN: Your dad saw it?
[0:31:55.5] DM: He saw it man.
[0:31:56.9] RN: He’s the mastermind man, he’s the brains.
[0:31:59.1] DM: Like I said, if you want advice, you call my dad Victor, just get ready for it because he’ll talk your ear off but he’s just an amazing – he’s just done it so many times. That was a close call. It wasn’t as bad.
The second one was, I was, I was building my company Flowtown, we’re a social marketing platform, we’d raise a bunch of money and what we did is we took – we added social data. Social and demographic data on top of email addresses.
Email marketers, this is 2009, we saw this transition from email marketing to social media and a lot of people had emails didn’t know where their clients were on social media so we actually built some technology, we integrated all these different API’s but a big part of it was Facebook.
We used Facebook data and a bunch of other data providers to provide this report and aggregate data on top of these emails and we were about to raise our next round of funding, we have grown to 50,000 customers and all of a sudden we get an email one day from Facebook and saying, “Within two months, the API called the integration, whatever, it’s a technical thing but essentially, the thing you’re doing with us will no longer be available.”
It literally made our product useless. It was the biggest kick in the nuts I’ve gotten. Not the – yeah, it would probably be in the top three and you know, we ended up going to the white board, brain storming three new ideas, market testing them quickly, picked the new one and slowly transitioned our customers over this new solution.
You know, 11 months later, great success story, we got acquired but I will say that from that story, that almost failure, essentially it’s a failure that we turned around, was I will never be dependent on another company for my success. Maybe it goes back to what my dad said. Essentially like, there’s this partner giving me 30% of your business.
What his argument was really simple. “Just grow your business so that they’re not more than 20% of your business.” Such a simple lesson and you know, I’ve had a lot of people that were in similar positions where their product essentially sits on top of somebody else’s data and they’re like, “What do you think?”
I tell them the story, I say, “That’s great but you need to quickly build a roadmap and a plan to get off of that as your primary core product.”
[0:34:09.4] RN: Outside of like software, eCommerce, like –
[0:34:13.4] DM: Happens all the time.
[0:34:14.1] RN: Amazon right?
[0:34:14.3] DM: SEO. I mean, frigging Google decides to change their algorithm, all of a sudden you lose 6% of your traffic. Amazon changes something, you got Facebook, decides to change something.
[0:34:24.6] RN: you don’t own it. You don’t have the customer’s information on Amazon right?
[0:34:27.7] DM: No.
[0:34:27.7] RN: You don’t have their email, you don’t have their phone number. You don’t own any of that. It’s a huge bust.
[0:34:32.9] DM: That’s a decision and that’s – for me personally, I would never feel comfortable being in a position where I don’t own the business because I don’t want to work really hard for seven to 10 years to have that taken away.
Yeah, those would be two failures that left - again, if I made the mistake twice then I’d be like, “That was mistake” but I’m really going to – I literally write things down, I have like a Google dock on my – I do a lot of angel investing, I have rules of investing. Because I’ve made mistakes but again, are they mistakes if I don’t make them twice? No, I just keep upending to the rules.
This criteria now needs to be true in the future. Saves me from making that mistake. I just think it’s – if you have that discipline and kind of being diligent in your lessons learned then life’s about pushing, learning pushing kind of recalibrating but it’s definitely not about playing it safe.
[0:35:27.2] RN: You’re obviously a really positive dude. Do you ever go in to this like –
[0:35:31.2] DM: Hell yeah.
[0:35:31.0] RN: A lot of people I talk to go into this serious ruts where they’re like, “I don’t want to talk to anybody, don’t want to be on social media, just” – it takes them a while to get out, does that happen?
[0:35:38.3] DM: Yeah. I’ll tell you what it is. I call it the entrepreneurial pendulum. It swings from exclamation mark take over the world, going to dominate everything, that’s who you’re called an envy out.
Ask actually, Cameron Harold about the entrepreneurial roller coaster. It’s the uninformed optimism. Anyways, you know, this exclamation mark and it swings all the way over to question mark, “what am I doing with my life, why did I start this businesses,” the dumbest thing in the world, right?
Literally, you can swing back and forth a couple of times in the same week and sometimes twice in the same day. You might wake up, “I’ve got a new customer, yay,” and then, we get. “Why am I doing this?”
[0:36:10.4] RN: Key person just fired.
[0:36:13.7] DM: It’s actually called automatic negative thoughts, ANTS right? It just happens it’s humans, fear is 20 times more powerful than aspiration, it’s just the way we’re programmed, you need to understand. The way I think about it in that pendulum swing is, “How can I spend as much time as possible in the take over the world exclamation?”
Then that’s really just this game you got to play with yourself, it’s a mental game, people talk about personal development and mindset. It’s real, it’s not – you don’t get born with that stuff, you can actually develop it like a muscle, I do a lot of stuff.
Do I ever get there? Yes. Do I stay there? No.
[0:36:52.6] RN: How do you get out?
[0:36:53.5] DM: I do a ton of stuff, gratitude, you can’t be grateful and angry at the same time, you can’t do it. Can’t, zero, not possible. If you’re feeling super fearful and you answer the question, one of three things I’m most grateful for today that are not normal, really, your heartbeat is a great answer.
The fact that it’s warm outside is a beautiful answer. Not, “I got money in the bank” – it’s like literally like things that are just simple. You can’t be fearful and grateful. Gratitude is another one, another thing I do is I coach a lot of high performing software entrepreneurs. I get them to create an accomplishments list.
Just like list things that you’re proud of for your whole life and start off right now and list 10 but you know, over time, not have it in ever note. Just make them there and those are the things you go back to, to remind yourself of all the greatness that you’ve done in your life.
[0:37:42.8] RN: It’s so true because entrepreneurs are so hard on themselves.
[0:37:43.8] DM: We forget.
[0:37:44.9] RN: And you’re hard on yourself.
[0:37:46.5] DM: If we spoke out loud, if somebody spoke to us the way we speak to ourself, you’d punch them in the face. Hands down.
[0:37:53.7] RN: That’s so true.
[0:37:54.2] DM: You literally would clock them. Accomplishments list, another one, I think a morning practice is really important, I call it a practice for a reason because I think it’s something like playing a sport, like being an athlete, like playing an instrument that you practice and you involve.
You need to, the people side of it right? Here’s another one, this is my favorite trick, this is probably my go to more than anything else. Accomplishments, I do a lot in the gratitude every morning, all that stuff, The Five Minute Journal, go buy it, you can thank me later. That’s a given.
The one I go to is, if I’m ever feeling down, I reach out and I offer to help somebody else. That’s like the easiest one. I mean, literally, you can just post on Facebook, “Hey, I’ve got an hour, if anybody’s struggling right now.” It sounds so counterintuitive, it’s like, why would I do that when I’m feeling like crap? There’s just something about helping other people.
[0:38:43.4] RN: I think I’ve seen you do that before.
[0:38:44.9] DM: I do it all the time. Yeah. Instead of being in a funk for three days like some people, they’ll just like close the door, watch Netflix and block out their calendar. I know what you're doing. Okay, I see you. Get out from your frigging bedroom and go back to your team. They need you now.
And just say like, “I got an hour, who wants to chat?” and then by the end of it, you just flip back into, “I am man, I can be helpful. I am valuable. I’ve got good ideas” and here’s the funny part is by doing that it almost reminds you of the things you probably know you need to do. So then you can’t stay over in this self-pity crappy mode. You’ve got to get back into the exclamation mode. So it’s really not about, Look we’re human, we’re going to end up over there.
It’s how much time we spend there so I spend very little time because of all these things I’ve added to my life.
[0:39:32.0] RN: What’s the last thing that you did to get out of your comfort zone?
[0:39:35.1] DM: I do stuff all the time. The thing that – trying to think of something that would sound scary.
[0:39:41.4] RN: Whether business, personal or whatever.
[0:39:43.8] DM: Running a Spartan race in September that was kind of and I was going to do the small one and my friends said essentially a bunch of explicatives. I don’t have a running buddy, I remember running a marathon once and I got the starting line, I looked around. It’s like, “Why are all these people so small?” I’m 6’3”, 220 I’m like, “This is going to hurt” so.
[0:40:07.5] RN: Did you ever run one since, a marathon?
[0:40:08.8] DM: Yeah, I did one and that was enough. Yeah, it took me five hours and 50 minutes and it sucked and it was the worst experience but you know I do stuff like that. I have climbed up Rainer, I do physical stuff that is scary but I would say just the business stuff it’s really about just like the mindset. For the past year and a half I had a goal of helping a hundred thousand at risk youth grow their confidence through entrepreneurship.
And just the other day, I was like, “A 100,000 is kind of fucking small, what am I…” and now it’s 10 million and I’m like, “Is there 10 million at risk youth in the world? I don’t know, there’s about 400 million entrepreneurs, yeah maybe there is. Anyway so now it’s 10 million” so it’s really about upping the game on what I set for myself of what’s possible and those always make me anxious because obviously if you make a public declaration you don’t want to not achieve it.
But I also think that it is important for us to set goals that are so crazy that we probably won’t hit them in a lifetime but there was this fire tube because we’re such assholes on ourselves and we got to the mountain top and as soon as were there, we look to the next mountain. We never can just be content and happy. So it’s like why not aim super crazy high and especially something as aspirational, it’s bigger than us I think it would require a team. I think those are the funnest things to work on.
[0:41:34.2] RN: There’s always these contradicting beliefs on this. So it’s like, “Set small goals so you can achieve them and then you will feel good about yourself” versus setting one for the moon.
[0:41:42.7] DM: I think they’re different. You create something aspirational but then you break it down to something you can get done. So it’s lifetime aspirational but next quarter.
[0:41:53.7] RN: Step one, got it, step two, yeah.
[0:41:54.7] DM: We’re going to do something, yeah. We’re going to move that boulder a little bit up the mountain. Directionally it’s got to move even if it doesn’t move 30 feet, you move it 10 feet but it’s up the mountain and then we’re going to keep it. There is obviously I think, nobody is going to argue with that but yeah, I don’t like it when people are like, “You know what are you going to do in the next five years?” “I am going to build a billion dollar company”.
Somebody said that, “I’m going to build a billion dollar company” look, I don’t disagree that you could do it because I know people have done it in five years like Travis Kalanick, the CEO of Uber was an investor in one of my companies, Flow Town. So I saw what Travis do, I saw the guys at Airbnb do, I saw people do it. So it’s not impossible but with no previous tracker, with not moving the boulder 10 feet up in a mountain yet and just staying in that, come on don’t be stupid you know?
[0:42:38.0] RN: And that’s not you being negative, it’s just –
[0:42:40.1] DM: No, it’s just like why are you setting yourself up for failure? If you said you want to do it in your lifetime, yeah that’s great. That’s aspirational. To say you are going to do it in five years and it’s playing the short game, I really think life, people think you can fast track shit. If I go to bake a cake and I put the heat up twice as hot as recommended, I’m just going to get a burnt fucking cake. You can’t cook a cake with 600 Fahrenheit. It doesn’t work and people don’t realize that.
Time is an ingredient in anything that’s been magical. To me, if you say what’s the ultimate entrepreneurial thing, mine personal is, you’re still the CEO of the publicly traded company that you founded. There’s only 27 in the world, Jobs, Zuckerberg, Bezos, Buffet, Gates so if you said what’s the ultimate entrepreneurial win, that and none of those things happen in five years or something, you know what I mean? They’re dedicated to it in their whole life and I think that’s special.
Some of them they don’t end up staying CEO. It’s the ones that literary are still running the company, they found it. It is such a different game to go from founding to –
[0:43:51.9] RN: Running the company.
[0:43:52.9] DM: At that level, you are not the same person. So that’s a big thing for me in life is that people always wish like, “I wish bad stuff didn’t happen to me” and I always laugh and say, “Well why don’t you wish you’re the kind of person that could deal” don’t wish they didn’t happen, wish that you were the person that you could deal. I don’t know what people think, the more success you have the less problems you have?
[0:44:13.1] RN: Jim Ronn quote, “Don’t wish it was easier, wish you are better”.
[0:44:16.0] DM: Exactly that. Become the person who can deal.
[0:44:18.5] RN: How do you assess risk and the potential of failure and the fear associated with that? Because for a lot of people just starting out, you have to take yourself back a little bit by getting started so what’s the best way to approach that in terms of like?
[0:44:34.1] DM: I guess because I’m crazy. I get it, I am not normal. Most people would not go through this stuff I went through. So I calibrate differently so I used to think you have to quit your job or you are not serious which is funny because I never really did that. So what would I recommend now is do your side hustle. Literally, It’s funny because I used to see these people talk about, “Anybody can make money on the internet” and I would see all these ads.
If you go to anybody’s website you get remarks so you see them and I’d be like, “Oh fuck another one of those” and then I listen to them and I’m like, “They’re so right”. Literally for zero money today, you can make it. If you need to publish content, WordPress is free. You need to accept credit cards, PayPal is free. You need to get your message out there, YouTube is free. Literally anybody today can start by trying for free.
Not to sacrifice their job, side hustle style, no cost with any tool, anybody who’s got a computer, you can literally can get a free computer these days.
[0:45:41.9] RN: You’ve got an amazing camera in your pocket.
[0:45:43.6] DM: It’s there and that’s what’s funny because people always say to me, “There must be so many more entrepreneurs today than there were before because it’s easier” it’s not. Isn’t that crazy? It’s never been easier, yet there’s not more per capita. It’s not like all of a sudden it used to be one percent of the population are entrepreneurs and now we have five. It’s still the same percentage. It’s just we know about them, they’re idolized more but it’s the same percentage because it has never been about the resources. Isn’t that crazy?
It’s never been about access to anything because it’s the people that are going to make it happen. They are going to be successful regardless.
[0:46:21.7] RN: Regardless of the circumstance, yep.
[0:46:23.0] DM: So then you’ve got to ask yourself, “What’s the game? What do I need to believe?” and it all come back to mental space and look, if you want the fastest way to turn this around, it’s the people that you spent time with. Real simple. If you were fat and you want to get in shape, go spend time with guys that are triathletes. You’re going to feel stupid ordering a muffin and a double mocha cappuccino when they are ordering green tea and the egg white thing.
You are going to feel dumb, you’re ordering the wings and the nachos and they’re ordering chicken with some broccoli and steamed, you know?
[0:46:57.7] RN: It’s an analogy, yeah.
[0:46:59.0] DM: Yeah, literally they won’t let you. You will feel that positive peer pressure like I was saying earlier and so if you start hanging out with entrepreneurs and you start hearing the way you talk, it just rubs off and I think it may not be the way that it all works out but it’s definitely the fastest way to get you out of that.
[0:47:18.3] RN: For someone that doesn’t have an idea, doesn’t know where to start, they know they’re destined for more but they feel their potential which –
[0:47:26.8] DM: Yeah, they know they’re possible for more.
[0:47:29.0] RN: Yeah, they know it’s possible but they just don’t know where to start, what’s a directive or action item you’d give them?
[0:47:35.0] DM: This comes from my buddy, James Altucher. He talks about developing your idea muscle. So I’m giving him full credit for this but I really think so like I cannot see problems like literally you know it. I could look around here and see 15 business ideas. We are just sitting on a patio looking out but I see valet service with the dude and the golf cart and the cleaning service. I literally could see 15 potential business opportunities.
Somebody coming in and filling out this gas, why do they need to drive to the gas station? I’m just going to make them pay a monthly fee, I’m going to fill up their gas and never even think about it. It’s just the way entrepreneurs are because we’ve developed the idea muscle. So I would say for people that don’t have that because they don’t know what to work on, every day write 10 ideas and it’s 10 things that frustrate you, that add friction to you and don’t be worried about how mundane it is.
If you feel frustrated that you ran out of toothpaste, write it down because in all of these little things, you’re just going to slowly – what happens overtime and I’ve worked with a lot of people on this, they start to see themes in themselves. They start to see categories of problems that they keep gravitating towards it. They start seeing the same thing coming up on this list and after literally a week or two weeks, you start to build that muscle.
I think that would be the first place to start then it’s like, “Okay, what do I think the solution could be to that and let me go find some people that are going to buy before I ever build anything”.
[0:48:59.5] RN: That’s a huge point because people think and I always talk about this, they look at business as being this big intimidating thing when you can look at it as a project, right?
[0:49:08.5] DM: I have a blog post on Seven Things You Need To Do To Start a Business. Step one, don’t call it a business. Call it a project. It can’t be a business because it’s not.
[0:49:19.6] RN: Yeah, totally it is a project.
[0:49:21.7] DM: Yeah, Maritime Vacation I’d say was a project. I built it, I got people to pay me money. I did incorporate after a while because there’s tax and stuff but it was really a project and I think that’s okay and here’s the other thing is you need to be okay to know that you might have multiple projects before you ever start the business.
[0:49:38.9] RN: See that’s another big fallacy right? People think the one business idea is going to be the only business they ever run.
[0:49:44.0] DM: No. I remember when I was like, “I am going to write a book” and I get all stressed out over writing the right book, the book and my buddy was like, “Dude you probably have several books inside of you” I was like, “Oh yeah, I probably do” it just took the load off in such a big way. So I would just say assume you have them all. I’ve started five companies personally like full on earnest companies but I have 25 projects, 30 projects started.
And just ask anyone how many domains have you registered, you know? Some people would say 500. I would be able to say 30 to 50.
[0:50:18.3] RN: Yeah but not one.
[0:50:19.5] DM: No, gosh no we see opportunity around this all the time and the funny part is that it’s not even seeing that is going to make you successful. It’s not because one of these people are like, “Let me run with one of your ideas” that’s not the way to do that either. It has to come from you. You need to feel it because when you go to communicate to your customers or hiring somebody, they need to see this.
[0:50:43.3] RN: They’ve got to see you care right?
[0:50:44.1] DM: Yeah, you guys know like water paint man it’s literary has this very emotional –
[0:50:50.2] RN: What’s your thought on that though? Because you hear a lot of people like, “Don’t worry about your passion just look for the business need” and then on the other hand it’s like why are you going to do something if you are not passionate about it? So how do you gauge that and judge that?
[0:51:02.1] DM: I think it’s dangerous. I definitely have a thought on it. I’ll say one thing that you’ve got to be die hard passionate about it, it can hurt people because when they start it, they did it because they were a passionate about it and then they realize it’s a job and then they’re like, “shit this isn’t fun anymore”. Look, business is not the same as being a practitioner. If you love to teach yoga, starting a yoga studio is not the same as teaching yoga.
So that I think is a place where it can really hurt people but I will say this, it’s really the Venn diagram of things that you know how to do, things you like to do and it doesn’t have to be super crazy but things you like to do. So you know how to do it and you have a skill, things you like to do and here’s the big one and the market will pay you and that sensor, if you have to pick live and –
[0:51:46.6] RN: Win the focus on.
[0:51:47.4] DM: Yeah, that one is the big one than the other stuff you can learn how to do some right? You know how to do it. I’ve sold stuff, I was like, “I don’t even know how to deliver that but I’ll figure it out” but I would say that’s probably the biggest thing is that if you’re – people like to play business, they fucking love to play. I actually didn’t call myself an entrepreneur for seven years because the entrepreneurs back then were the biggest ding dongs in the world because I didn’t know.
And I was like, “All they have was business cards and they’re selling bullshit” it’s they’ve played business, right? I don’t want people to play business. You literally have to go and find a customer, you’ve got to sell it, you’ve got to get their money, you’ve got to over deliver and you’ve got to keep trying and doing that and you are allowed to iterate and just call it a project and take the pressure off and don’t worry if you decide to stop doing it because you found something more interesting.
Or you found a unique angle or whatever, just literally be okay with the process and keep your side hustle and just say, “You know what? Once I get to 2,000 a month in income on the side thing that’s when I’ll quit my job” just set a target. Just say “when I get to this level on the side thing, then I get to quit my job” and I think that’s a beautiful way of transitioning and if you don’t, then look not everybody is and look, there’s three different ways to become wealthy.
The artist, the manager and the entrepreneur. You can be a world class artist and still make – what does Stephen Curry make like $25 million a year? Yeah, he’s an artist you know? And then the manager of the team, the general manager of the team makes five million a year. He’s the manager, he make sure of the clocks and trains around all the time all day and he gets five million and the owner, the entrepreneur, you know it’s a billion dollar franchise and they’re partners so he owns a $500 million franchise.
So the entrepreneur will always be disproportionately rewarded because of the risk but it doesn’t mean you can’t make a lot. The first 30 employees at Facebook still made a $100 million. I think people think like, “I need to be entrepreneurial” it’s not true. You do need to take risk, you need to be around other entrepreneurs, you need to understand where the world is going and get in front of that but you don’t have to always be the creator of the thing.
[0:53:54.1] RN: On the note of removing the risk upfront, what’s the best way to presell? Because obviously it’s a brilliant way to get into business right?
[0:54:01.2] DM: Oh man, I wish there’s more people around you because I would just do it for your audience right now. I think the best way to see is just hear somebody do it. The best way is just ask for advice you know? Let’s say, I’m making this up but let’s say an app. Okay, so I just got this notification about my data usage because I am Canadian. So it’s like, Hey Rob have you ever hate your data usage when you travel internationally?”
[0:54:20.8] RN: All the time.
[0:54:21.5] DM: It sucks right? What’s the most expensive it’s ever been?
[0:54:24.1] RN: $300.
[0:54:25.1] DM: 300 bucks and what’s your normal monthly plan?
[0:54:27.7] RN: Oh it’s like 55.
[0:54:29.1] DM: So you go from 55 to 300, that’s crazy. You know my buddy built an app for six bucks that would monitor that and notify him so it will never happen in your life. Would you want to buy that if I can get it to your right now?
[0:54:41.0] RN: Yeah absolutely.
[0:54:41.9] DM: Exactly. So all I did was I asked. People need to ask and then you’ve got to qualify. Sometimes people they hate selling because they get no’s. Well you didn’t ask if they had the problem, you know what I mean? So of course, it’s going to suck because –
[0:54:55.1] RN: Do you want a data usage app?
[0:54:56.5] DM: Yeah, no. “Have you ever had this happen? Yes. Cool, how much did it suck?” so what I did is I stretched the gap. I said, “Oh that was there. What is it normally? 55, that’s crazy!” you’re like, “Yeah, I know it’s crazy” “Are you married?” yes, “How did your wife feel about that?” she was going to kill me or “Do you have a business partner” and they say, “Look you know we have a solution that solves that and it’s 10 bucks and right now, you can get it for five” what?
“Yeah, it’s right now that you need to invest right now. You know it’s cool, have you heard of an early adopter program and it’s something that we’re creating right now and you’ll help co-create it and if you like, your name will be in the app” and so you’re giving them a reason to pre-sell. Like I call it the early adapter program, some of my clients they call it the founder’s list. You see a lot of these crowd fund. I really think that crowd funding, it’s been going on for years.
You literally go to the early, you ask any entrepreneur, Richard Branson first at airline. You know what he did? He leased the plane, he got the contract, he went on to the airport because the fight got canceled and he said, “Who wants to buy a ticket?” he sold the tickets and then he went and completed the contract but he didn’t mean. He asked about leasing the plane, went and sold the tickets then leased the plane. So I feel like that’s been going on forever. It’s called a crowd funding.
It’s literally brought the cost of failure to zero. To test ideas at scale and I just think that’s a beautiful thing. It’s the world that we live in, we have tools again but it’s not the tools. You know what’s funny? Literally this platform that anybody can do crowd funding. So if you want to do crowd funding, there’s no reason you can’t but it’s not going to be the tools because the people that are going to be successful at crowd funding would have been successful regardless.
They just can- so what you are seeing now is companies get to a billion dollars faster. That’s what changed.
[0:56:44.4] RN: Shortage occurred right?
[0:56:45.1] DM: Yeah, everything is faster, faster, faster. Companies could go to zero to a billion faster than everyone. It was like Groupon was five, six years ago they were the fastest to a billion. Then there were other companies, I invested in a company called Intercom. They’re the fastest growing software service company right now, they beat Dropbox just because the market is more efficient, the channels are there.
Social media allowed what’s called viral word of mouth to occur, before you could only virally seven people you talked to in a day now you have access to an average of about 200 people on Facebook. So if you like something, there’s all these other things but it’s not more entrepreneurs. It’s literary the people that are willing to do what we just talked about which is presell. Just ask for advice, just ask questions. “Have you ever had this problem?” “No”
Cool, there’s a restaurant over there with about 50 people around the area. I could go sell my idea and at the end of 20 minutes decide whether I am not going to do it or I’m going to do it. Quick, boom, done.
[0:57:44.0] RN: You know. You know and you don’t have to keep thinking on it. You don’t have to think of these ideas for six months.
[0:57:49.2] DM: Yeah, wouldn’t it be cool and did it Friday night and they have three beers and just like, “Yeah we could call it this and then this, this works and then we’ll do that and we’ll see that and we’ll add this package” “Yeah that would be so cool” that irks me.
[0:58:02.5] RN: Yeah because you can find that right now.
[0:58:04.2] DM: I literary want to pick them up, let’s go to the mall like I was 20 years sitting in the mall with a clipboard selling this property management software, you know what I mean? Getting people to give me money, it was an interface that I drew. I mean there was nothing there so I just get the feedback, get the people and I get that’s scary are crap but you know what’s scary? Losing your life’s savings, going all in, borrowing money from your parents, quitting your job and failing.
That potential is the drive for me that I have two little boys, I would never want to put like there’s nothing I wouldn’t do to make sure that they ever had to feel like they couldn’t like literary couldn’t eat. No way, that’s not happening. I don’t know, sometimes it’s good to have your back against the wall.
[0:58:56.8] RN: On that point because I was always the same way like, “burn the ships, quit the job, I’m all in” and that’s what’s going to be like, “back against the wall, fire under my ass, I’ve got to make it happen” and for me, that’s been what’s worked for me and we talked about side hustle, I don’t know. I try to think like, “Okay I could have done it that way as well” I just don’t know though. I really don’t. I don’t know if I would have had the drive like that to- .
[0:59:24.9] DM: Yeah look, the cool thing about entrepreneurship is there’s a thousand ways to be successful. There literary is a thousand. I know people are like, “What’s the one thing?” I hear what you’re saying, you want to know the one thing. It’s never one thing. It’s literally like painting art and there’s a thousand brush strokes and different passers. Introverts, extroverts, this guy had nine different ways to create wealth.
Warren Buffett is a totally different dude than Oprah Winfrey and he’s totally different than Jack Welch at GE and he’s totally different than Rick Dison, you know what I mean? They’re just different entrepreneurs but they are all extremely wealthy. So there is no one way but at the core of it is wherever your comfort zone is right now, it’s outside of that. We all know that much, whatever you feel comfortable with that next level anxiety it’s over there.
So make decisions that go over there and if for you that’s even doing a side hustle, see that’s the thing. For us, we like that because we’re confident in our skills where somebody else that doesn’t have that just even doing a side hustle would keep them up all night knowing the next day that they go to the mall with a clipboard, you know? So I guess that’s really that I think everybody can agree on is part of the ingredients.
[1:00:47.3] RN: Who’s had the single most profound impact on your life? I know you talked about your dad but who do you say like, “Man I literally would not be where I am without that person”?
[1:00:55.8] DM: Well I’ve told the story a few times, it’s super personal but I was in jail. I told you about the fight I got into, this guy named Kurt, over coffee of all things and I got locked up in not detention but isolation, what’s that?
[1:01:10.5] RN: The hole.
[1:01:11.9] DM: The hole, solitary confinement. I got put into solitary for three days. Again I was 16 years old at the time, it’s probably the most inhumane thing you can ever do to another person is essentially strip you down, put you in a room, light on 24 and a half hours a day. They let you up for three minutes a day. It’s the worst, no books, nothing.
[1:01:27.6] RN: Lights are on the whole time?
[1:01:28.1] DM: Yeah, except for at night they turn them off. I mean you really don’t know what time of day it is. On the third day this guard Brian who was away when the incident happened came to cell. Came and got me and I was ashamed because Brian was one of the cool guards that looked away if you are doing something like watching TV longer than you should or whatever but he was always like if you treat him well he will treat you well and I felt really stupid because he knew I was trying to do well.
He comes and gets me and he’s walking me back to the cell block and we go past the door that goes into the cell block where all the other juveniles use are and he brings me into the guard unit which is this glass square that overlooks these two cell blocks and I’ve never been in there. I have been there for three months and I have never seen the inside and I was like, “what’s going on?” and he walks me and sits me on the corner and he sits down.
He just looks at me with that disappointed face and he just says, “What are you doing here?” I said, “Well me and Kurt got into a fight over breakfast and drinking the last coffee” he’s goes, “It’s not that. What are you doing here?” and I said, “You know I got into a high speed chase and I ran in a house and I had a gun” and he goes, “I’ve been watching you Dan for the last three months and I am seeing you trying to stay out of trouble and do your homework and really do good for yourself”.
And he says, “You don’t belong here” and he said, “If I am the first person ever I want you to know that I believe in you” and at 16 years old that was the first time anybody had ever said that to me and that literally changed everything from that eight year old that felt broken my whole life and knowing that I wasn’t that person, that’s the worst part. I knew I wasn’t that person. All that shit people say. Yes, I knew I’d do those things but in my heart I always felt like caring and a good person.
But I just wasn’t in the right scenario to succeed I guess and here’s a guy that’s seen hundreds of kids come and go and he’s looking at me and he decided to take time out of his day, he didn’t have to and to say that, that changed everything for me.
[1:03:36.6] RN: Have you talked to him since?
[1:03:38.0] DM: Yeah.
[1:03:39.3] RN: Did he remember you?
[1:03:40.9] DM: Yeah.
[1:03:41.6] RN: That’s cool.
[1:03:42.3] DM: Yeah, Brian I really feel like I got a – I mean obviously I got a second chance. I should have died probably three times growing up and for some reason there were some angels looking out for me and that is why every day I don’t waste a fucking day and I can’t teach that.
[1:04:02.1] RN: Right, yeah. You can’t even factor that.
[1:04:04.8] DM: No, I got a chance and I said to whoever was looking out for me, “If you help me get through this I will dedicate the rest of my life to help other people like me” period and for 15 years, as soon as I made money I started giving money to Portage, helping out, speaking there three to four times a year and I didn’t tell a soul for 15 years until this event, exactly four years ago. It’s funny that we’re talking, four years ago this guy named Jayson Gaignard in Toronto asked me to speak.
I didn’t know who he was, my buddy Michael Lit, I saw him on Facebook. He was friends with him, I said, “Mike is this guy legit?” he’s like, “Yeah he’s good” so I said yes to speak at his event and we get to his event and I’m there with my wife, she’s pregnant and we had our one year old at the time and our boys are 11 months apart with is another crazy story itself but she was there and Jayson says, “Hey I just want you to know it’s 15 minute talk TED style”.
And he said, “The best talk voted by the audience wins $25,000 to a charity of their choice” and I was going to talk about marketing or something stupid and I go, “There’s no way I’m going to win this” and there was such this urge of wanting to have that for Portage. This place saved my life and I went back to the hotel room and my talk was on the second day, back to the hotel room that day and drew out a talk the first time ever telling what I went through as a kid and what I learned about tenacity and risk and whatnot.
The next day I get up to go give the talk and my wife turns to me and says, “Hey Dan, I’m not supposed to tell you but my parents want to come by and see your talk to surprise you” and I was like, “Uh…”
[1:05:41.0] RN: Did they know what was going on with you before?
[1:05:43.3] DM: They knew nothing dude, nothing and I was already nervous and dude, this is 200 like Tim Ferriss is in the room, Marc Ecko, this is a high end group of people that I had a lot of respect for and here I am about to bare my soul and I said, “Please don’t let your parents leave without me talking to them. Hold them because I don’t know how they’re going to react” and I went out and I shared my story and my truth.
[1:06:09.1] RN: Did your wife know?
[1:06:09.9] DM: She didn’t really know to that extent.
[1:06:11.6] RN: Got it.
[1:06:12.1] DM: Like to the detail of what happened. She knew I got into trouble but I never told that specific story. Yeah, if you go to my YouTube channel you can go find it and stuff. Man, I got off stage, camera hold, some people came to me and he said, “That was…” I looked around and nobody on their phone like that was incredible. I was like, “Thanks man” and it was just like this, it was anxious but at the same time I just felt like, “Okay this is who the fuck I am”.
Everybody is asking me the success theater bullshit, right? At that point everything, the Clarity, the Flowtowm, all the success theater but nobody knew who I was in my core and that was it and then Tim Ferriss came out to me and he goes, “That was the most amazing thing Dan” and I’ve known him. That time I knew him for five years and he had no clue. I said, “Nobody had a clue. It was the first time I ever shared it” and from that point on, four years ago I decided that’s how I want to show up in the world.
I want people to know my story and that’s where I started to realize that I had an opportunity to really help other kids that went through similar or going through similar things and I started a program to start mentoring at risk youth and it’s –
[1:07:24.2] RN: Could you have done it sooner?
[1:07:26.5] DM: A thousand percent I could. You know what the fucking bullshit story I was telling myself? I wasn’t successful enough yet. I literally said, “When I’m on Oprah” like I don’t want to be on Oprah. I don’t even know why I thought that like “When I am successful enough to be on Oprah then I’ll tell my story” and that is the dumbest thing ever because I could have been serving because the truth is when I tell that story, I have parents that have kids in trouble come up to me.
I have foster parents that come up to me and thank me because I told part of being in a foster care and they’ve seen kids come in and leave and not know whatever happened to them and for them to hear me and what I have done with my life just makes them feel so happy for being a thought. I didn’t know that was going to be a byproduct of that. Literally when you share your truth, you create a space for other people to come into and you give them permission to explore that for themselves.
And it is probably the most authentic and real and impactful thing and yes, I built companies and all those stuff but that, that’s my legacy. That’s what I am here to do on earth and the fact that I have waited for 15 years was a waste and that’s why I told Jayson after that like, “I am not going to keep the story inside” even though at that time it was 200 people and I could have never told it again and probably overtime get dispelled.
I was like, “Nope update my about page” and you don’t want to get on stage, at podcasts I always bring it up and I get the text message from the parents and their kids just got arrested and I get on the phone and try to share some wisdom and thoughts and it’s the most meaningful stuff I do and yeah.
[1:09:06.5] RN: Right, it puts business to shame really right?
[1:09:08.7] DM: Yeah, I know. The business stuff is really something that I really love to do but I mean what’s my purpose, I really think it’s to help other kids not feel broken and anybody listening to this can help me get that message out there to more people. I’d be so grateful and open to that and I guess that’s what I do.
[1:09:29.2] RN: I love it. So with danmartell.com right now, with everything you’re doing what are you most excited about?
[1:09:35.0] DM: Yeah, I’ve got a book coming out not too long and I think what do I do, I coach high performing sass entrepreneurs. So software entrepreneurs that want to scale their businesses and people scale away. A lot of them get stuck in the 10K a month and they’ve got churn issues. It’s always technically speaking that’s my place, strategic that stuff and what’s been great is this allowed me to work on the communications skills.
Prior to starting that site, I never did a video on YouTube. I keep my old videos up there just so people can and I produce a video every Monday for the past almost two years. So what it’s been is an outlet for me to perfect how do I teach, how do I coach that I get to leverage for these kids. They get the best version of me that the entrepreneurs I coach kind of help fund. The fact that I am even – it’s funny because I work with them every two weeks.
But within those two weeks they watch my YouTube videos. The YouTube videos were made for more advance business stuff but they’re still inspired to try and figure out what I’m saying. It’s crazy to me like this kid Justin, he’s 19 and he watches my business videos and he talks to me about metrics. He’s like, “Should I know that?” and I’m like, “What are you doing man? Let’s just focus on your idea” you know? Don’t worry about all these other stuff.
He’s like, “Okay but I watch your stuff” so I just think it’s been the most amazing thing but that’s what I do. I do it through group programs. I don’t do a lot of one on one, I reserve that for my portfolio companies of entrepreneurs I have invested in and I have entrepreneurs all over the world that I work with and it’s just cool. It’s just like back to the stuff where I still find it so fascinating that you can be anywhere in the world and serve people.
So I remember people saying that you can literally get paid to do anything. My dad say this, “If you want to be a rock flipper, you’re passionate about flipping rocks you can build a business around rock flipping” and I was like, “That is the dumbest thing” but then you know what? I have buddies that own multi-million dollar rock quarries and technically that’s kind of what they do, you know what I mean? So in today’s world, I have a friend that teaches and coaches dance studio owners.
I have another one that teaches jewelry makers, plumbers, I mean you name the vertical. You people have no idea that this new economy of supporting, taking something you’re passionate about and even if you have never had success in the thing literary being the person that curates. I have a buddy Amir, he’s got blockgeeks.com, he’s not a block chain programmer. He’s not but he’s nerded out on Bit Coin and produces content and curates and shines the light on the things he finds fascinating.
And that’s going to be a multi-million dollar company around a topic that he’s passionate about. Everybody has that today.
[1:12:36.5] RN: I totally agree.
[1:12:37.6] DM: So if you’re hungry and you want it, it’s right there but you are going to need to do something just get up and go do it. Something is going to make you feel awkward about it and you just got to say, “I appreciate that. I understand why you’re here in my life to make me feel awkward because you don’t want me.” We’ve been programmed as adults and fear is there for a reason.
[1:12:56.4] RN: So on that note, this is the perfect segway, what is a challenge that you can lay out for the listener to actually get them out to stretch your comfort zone?
[1:13:04.6] DM: Easy, it’s going to be something about strangers. I’m just trying to figure out what’s the question, this is it: Every person, anytime you go to buy something for the next seven days, Starbucks, car wash, gas station, I want you to stop and ask for the person’s name. Literary that’s all you do. The person goes, “What do you want, grade or Americano? Thanks that will be 19” I want you to say, “And your name is?” and she’s going to go, “Julie”.
You say, “Julie, thank you so much” and give your money. I want people to do that because it’s so powerful. You are thinking and this is what’s funny, they’re thinking “But that’s weird” and because you feel weird the person is going to feel weird but I will tell everybody listening I do this every day and people appreciate it because there’s nothing that sounds sweeter than the name, their name. They love it and so it’s literary figuring out how to say it from a place of, “I just want to use your name”.
I have been coming here for 18 months buying coffee from you. I don’t know your name and today is the day that stops. I think that is a beautiful thing for every listener on here just to add to their life, to push themselves out of their comfort zone a little bit.
[1:14:20.6] RN: Simple, you can do that today.
[1:14:21.4] DM: Everybody, seven days, every time you go buy something stop and say, “And your name is?” and you will floor them because you are probably the only person that day that have asked and they’ve served hundreds of people.
[1:14:33.5] RN: That’s true.
[1:14:33.9] DM: And that’s all they want to hear. It’s their name and just appreciate and say thank you.
[1:14:38.7] RN: Love it. Cool man, well I am not going to take any more of your time but I appreciate it.
[1:14:42.3] DM: Rob it’s been awesome, thanks for having me.
[1:14:44.0] RN: Yeah, I had fun dude.
[END OF INTERVIEW]
[1:14:47.5] RN: All right, so you can find Dan @danmartell on Twitter and all the links and resources Dan and I discussed including more information on how his current ventures and past successful exits can be found at the page created especially for this episode. That will be on failon.com/023 and next week we’ve got a good one. We are sitting down with Daniel Demski. Daniel is the co-founder of a company that had an incredibly successful crowd funding campaign, Unbound Marino.
I love his business probably more than he does actually. It is a revolutionary travel clothing brand that will help you globe trot without all of the baggage. I wear the shirt nearly every day and he’s an extremely interesting guy. He has a fascinating story, make sure to tune in and if you are finding value in the podcast and has the wheels turning please email me at email@example.com and let me know what your biggest struggle is right now.
As I continue to build Fail On with the goal of helping people embrace failure, share their struggle and decide once and for all to create change in their lives, I would be really grateful if you could help me with a couple of things. Subscribing to the podcast takes a single click and helps the show get found by more people and when people can find the show, it means it can help more people which means in return, you are helping people by simple subscribing. So to subscribe and rate and review the podcast, super simple, just visit failon.com/itunes or failon.com/stitcher.
[1:16:10.8] ANNOUNCER: That’s all for this episode of The Fail On Podcast. For more resources, show notes and action items to help you find success in your failures, sign up for our mailing list at failon.com.
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