Podcast Title: How I Built This with Guy Raz
Episode: Advice Line with Perry Chen of Kickstarter
Release Date: June 12, 2025
Host: Guy Raz
Guest: Perry Chen, Co-founder of Kickstarter
Introduction
In this engaging episode of How I Built This with Guy Raz, host Guy Raz reconnects with Perry Chen, the visionary co-founder of Kickstarter. The episode centers around the "Advice Line," where Perry offers invaluable insights to entrepreneurs seeking guidance on scaling their businesses, raising capital, and navigating the challenges of growth.
Perry Chen’s Current Endeavors
[04:10] Perry Chen begins by updating listeners on his journey post-Kickstarter. After stepping down as CEO and later from the board, Perry ventured into the art world, collaborating with galleries and museums. However, his true passion led him back to music, where he is currently channeling his energy and creativity.
Perry Chen [04:27]: "And so as of about six months ago, I am now liberated... the music stuff is kind of still. It's under wraps, but it's been going really well."
The Intersection of AI and Creativity
[04:49] Guy Raz introduces a thought-provoking discussion on the impact of Artificial Intelligence on creative businesses. He raises concerns about the future of earning a living through creative endeavors, given the advancements in AI that blur the lines between human and machine-generated content.
Guy Raz [04:49]: "With AI, it's a completely new age... it’s going to be difficult to discern what is AI generated and what's human generated in certain creative spaces."
Perry Chen's Perspective:
[05:32] Perry acknowledges the instability in creative industries but remains optimistic. He emphasizes the importance of opportunities expanding rather than contracting, even amidst rapid technological changes.
Perry Chen [05:44]: "I don't think it's ever been really stable for people working in those spaces... as long as it continues to open up opportunity for people, I think then that's just normal change."
Raising Capital on Kickstarter
Perry Chen delves into the strategies behind successful Kickstarter projects, highlighting the significance of existing audiences and community engagement.
[06:23] Perry Chen: "There's people that have existing audiences that they can start the promotion on... you can go try to promote that in communities online where people gather around that topic."
Caller 1: Jesse Hodge of Modtub
Jesse Hodge introduces Modtub, a company that manufactures and sells cold plunges designed to keep water cold and clean without the need for ice.
Background and Growth:
[07:18] Jesse Hodge: "We started Modtub in February of 22... we saw the rise of cold plunge, and because of all I knew about hot tubs, we were able to make our own cold plunge out of my garage."
- Sales: Last year, Modtub achieved over $5 million in sales, doubling from the previous year.
- Product: Cold plunges priced at $3,000, with the latest version, Modtub 2.0, priced at $3,300. The company is profitable since launching the cold plunge.
Business Challenge:
[10:34] Jesse Hodge: "We've been approached by people interested in potentially buying Modtub or investing in Modtub, so looking for advice to know if and when is the right time to go down one of those paths."
Perry Chen's Advice:
Perry encourages Jesse to introspect on his vision and whether he is ready to scale or pass the torch to someone better suited for growth.
[11:07] Perry Chen: "What do you want? There's no better question than just keep asking yourself... [you may] want to let go of some control and get some more outside perspective."
Guy Raz's Input:
Guy suggests exploring options like hiring a professional CEO or selling a portion of equity to a partner who can drive growth, emphasizing the importance of strategic decision-making for scaling.
Notable Quote:
[15:23] Perry Chen: "It's not an easy question... some people got into their business and they're trying to really, they want to get in the optimal window for sale... Other people, you're just like... you're just into this."
Caller 2: Kathryn Kirbis of Hitch
Kathryn Kirbis shares her journey with Hitch, a chef-crafted hot sauce brand known for its flavorful sauces with manageable heat levels.
Background and Growth:
[24:17] Kathryn Kirbis: "We are known for our super flavorful hot sauces with slightly lower heat... sold in grocery stores around the northwest and in specialty stores around the country."
- Sales: Last year, Hitch achieved $157,000 in sales, up from just under $3,000 in their first year.
- Distribution: A 50/50 split between wholesale channels and direct-to-consumer sales.
Business Challenge:
[27:00] Kathryn Kirbis: "After nine years of building our business... we would love some advice on how to scale to successfully international retailers without getting significant outside investment."
Perry Chen's Advice:
Perry advises Kathryn to consider strategizing with set goals and possibly seeking aligned investors who share the brand's vision.
[28:35] Perry Chen: "Give yourself some time... figure out what it’s gonna take to get this in the position where it has the opportunity to get acquired."
Guy Raz's Input:
Guy emphasizes the importance of product demonstrations in scaling and suggests a strategic approach to reaching sales targets necessary for acquisition.
Notable Quote:
[32:47] Perry Chen: "You could always hire somebody if you feel like there needs to be an image of somebody standing there."
Caller 3: Joe Fontana of Fry the Coop
Joe Fontana discusses Fry the Coop, a rapidly expanding chicken sandwich shop in Chicago known for frying everything in beef tallow.
Background and Growth:
[37:15] Joe Fontana: "We finished last year at $12.9 million and we're already on track to do $14.5 million this year."
- Locations: Currently operating 10 locations with plans to expand to 75 within 10 years.
- Unique Selling Proposition: Uses beef tallow for frying, enhancing flavor and setting them apart in a competitive market.
Business Challenge:
[40:26] Joe Fontana: "We need to raise about $30 million to achieve our goal of 75 stores, but our company's not even worth $30 million."
Perry Chen's Advice:
Perry suggests Joe explore alternative financing methods, such as seeking minority equity investments from family offices or structured loans that align with Joe's vision.
[44:15] Perry Chen: "Give yourself some box, some constraint, some time box around, plan, you know, plan big... And then, okay, if that doesn't work out in this amount of time, then shift your mind."
Guy Raz's Input:
Guy offers practical solutions, including exploring franchising, selling properties to lease back, and enhancing operational efficiencies to support rapid expansion.
Notable Quote:
[50:50] Perry Chen: "What you really want is a plan B where you give yourself a safety valve... what do you really want?"
Closing Insights
As the episode wraps up, Perry Chen reflects on the emotional and psychological challenges entrepreneurs face, emphasizing the importance of aligning personal desires with business goals to maintain passion and prevent burnout.
Perry Chen [52:46]: "A lot of what I picked up... entrepreneurs statistically end up in that category. And it's not something that really gets talked about a lot."
Final Thoughts from Guy Raz and Perry Chen:
Guy praises Perry's invaluable contributions and underscores the importance of thoughtful decision-making in entrepreneurship. Perry adds a touch of humor, suggesting a tongue-in-cheek podcast idea to address the more challenging emotional aspects of running a business.
Perry Chen [53:02]: "I love that."
Key Takeaways
- Strategic Scaling: Entrepreneurs must carefully assess when and how to scale, considering options like bringing in a professional CEO or seeking aligned investors.
- Community Engagement: Building and leveraging existing communities can significantly enhance the success of crowdfunding campaigns and product launches.
- Balancing Passion and Growth: It's crucial to align business growth strategies with personal passions to sustain long-term commitment and prevent burnout.
- Alternative Financing: Exploring diverse financing methods beyond traditional bank loans, such as minority equity investments or family office partnerships, can provide the necessary capital for expansion.
- Operational Efficiency: Enhancing operational processes and investing in strategic marketing, like product demos, are essential for scaling successfully.
Notable Quotes:
- Perry Chen [04:27]: "I am now liberated... the music stuff is kind of still. It's under wraps, but it's been going really well."
- Guy Raz [04:49]: "With AI, it's a completely new age... it’s going to be difficult to discern what is AI generated and what's human generated in certain creative spaces."
- Perry Chen [11:07]: "What do you want?... you could let go of some control and get some more outside perspective."
- Perry Chen [28:35]: "Give yourself some time... figure out what it’s gonna take to get this in the position where it has the opportunity to get acquired."
- Perry Chen [32:47]: "You could always hire somebody if you feel like there needs to be an image of somebody standing there."
- Perry Chen [44:15]: "Give yourself some box... plan big. And then, okay, if that doesn't work out in this amount of time, then shift your mind."
- Perry Chen [52:46]: "Entrepreneurs statistically end up in that category. And it's not something that really gets talked about a lot."
This episode provides a treasure trove of insights for budding entrepreneurs and established business owners alike, emphasizing the delicate balance between growth, passion, and strategic decision-making.