68 Rejections, One Yes: How I Built a $100M Startup Against All Odds | Dan Shapiro | E119

Summary

Podcast Summary: Leap Academy with Ilana Golan – Episode 68: "Rejections, One Yes: How I Built a $100M Startup Against All Odds" with Dan Shapiro

In Episode 68 of The Leap Academy Podcast with Ilana Golan, host Ilana Golan engages in an in-depth conversation with Dan Shapiro, the CEO and co-founder of Glowforge. This episode delves into Shapiro's entrepreneurial journey, highlighting his resilience in the face of numerous rejections, the lessons learned from major tech experiences, and the strategies that propelled Glowforge to a $100 million startup. Below is a comprehensive summary capturing the key discussions, insights, and conclusions from their dialogue.

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1. Introduction to Dan Shapiro

Ilana Golan introduces Dan Shapiro as a seasoned entrepreneur with a diverse background:

• CEO and Co-Founder of Glowforge, a transformative 3D laser printer impacting homes, classrooms, and small businesses globally.
• Previous Achievements:
  • Sold a startup to Google.
  • Authored the startup guide Hot Seat.
  • Created Robot Turtles, the most backed board game in Kickstarter history.

Notable Quote:

Ilana Golan [01:01]: "Dan sold a startup to Google and created the most backed board game in Kickstarter history."

2. Early Life and Background

Shapiro shares his upbringing in an academic household:

• Parents as Professors: Father specialized in computer science and database design; mother in organizational communications.
• Educational Influences: Grew up engaged in research and technical discussions at the dinner table, fostering a blend of social science and computer science interests.

Notable Quote:

Dan Shapiro [02:39]: "I guess I'm the answer to the riddle, what do you get when you cross a social scientist with a computer scientist?"

3. Academic and Early Entrepreneurial Ventures

Shapiro discusses his time at Harvey Mudd College:

• Field of Study: Engineering, initially unaware of what engineering entailed.
• Early Entrepreneurship:
  • Built laser displays for events like Pink Floyd’s The Wall at planetariums.
  • Operated laser shows and a DJ business, planting seeds for future ventures.

Notable Quote:

Dan Shapiro [04:32]: "I was always the one looking at an interesting angle and, oh, maybe I could sell this or do that."

4. Corporate Experience at Microsoft

Transitioning to his professional career:

• Joining Microsoft in 1997: Initially skeptical about entering software but took on a program manager role in hardware for Windows.
• Contributions: Worked on Windows 98, 2000, and XP, influencing UI design and hardware integration.
• Learning Experience:
  • Gained insights from top leaders like Bill Gates and Steve Ballmer.
  • Recognized the need to "unlearn" corporate practices when transitioning to startups.

Notable Quote:

Dan Shapiro [06:56]: "It really helped to learn a lot of lessons that otherwise I would have had to learn on my own and sort of the hard way."

5. Transition to Startups and Ontella

Post-Microsoft, Shapiro ventured into startups:

• Wildseed: Worked on an early Linux-based cell phone OS, preceding Android.
• Ontella: Co-founded to develop a service syncing dumb phones to the cloud and PC, facing nine months of fundraising struggles without success.

Notable Quote:

Dan Shapiro [17:24]: "And then I promised myself that when and if I cracked the nut, I would tell everybody."

6. The Fundraising Struggle and Breakthrough

Shapiro recounts his arduous journey to secure funding:

• Approach: Pitched relentlessly to 68 investors over nine months.
• Breakthrough Moment: Met the key investor serendipitously at a conference in Barcelona, leading to the first funding check.

Notable Quote:

Dan Shapiro [20:37]: "It was nine months of pitching anything that moved... 67 nos. 68th one was a yes."

7. Building and Merging with Photobucket

Following initial funding success:

• Photobucket Merger: Orchestrated a complex merger by offering Glowforge common stock, renaming the company to Photobucket to capitalize on the mobile wave.
• Strategic Challenges:
  • Rejected collaboration offers from giants like Facebook, which later led to internal conflicts.
  • Navigated corporate politics, ultimately stepping into a Chief Technology Officer role before parting ways due to misaligned visions.

Notable Quote:

Dan Shapiro [25:23]: "We ended up turning them down... which became a huge waste of time and totally distracted our company."

8. Launching Glowforge

The genesis of Glowforge emerged from personal tinkering:

• Inspiration: Frustrations with 3D printing led Shapiro to experiment with laser cutting.
• Evolution: Transitioned from hobbyist experiments in his garage to developing an industrial-grade 3D laser printer.
• Product Vision: Simplified the creation process, allowing users to "push a button" and produce beautiful, functional items swiftly.

Notable Quote:

Dan Shapiro [51:19]: "The ability to just dream something up and be holding it literally five minutes later, still magic to this day."

9. Leadership and Managing Growth

Shapiro discusses the complexities of scaling Glowforge:

• COVID-19 Challenges: Faced critical decisions impacting employee safety and operational continuity.
• Ethical Dilemmas: Refused to falsely claim medical equipment status to keep production running during the pandemic.
• Leadership Philosophy:
  • Emphasizes responsibility and ethical decision-making.
  • Advocates for CEOs to lead from their core strengths and passions, drawing inspiration from leaders like Bill Gates and Larry Page.

Notable Quote:

Dan Shapiro [56:53]: "The grand truth I learned was I don't fricking know. Bang your head against the wall until you make a hole."

10. Insights on Entrepreneurship and Resilience

Shapiro shares candid advice for aspiring entrepreneurs:

• Passion and Necessity: Entrepreneurship is likened to professional artistry—it’s pursued out of necessity driven by passion rather than as a mere career choice.
• Fundraising Reality: Success often hinges on perseverance and a degree of luck, underscoring the importance of relentless effort despite repeated rejections.
• Ethical Boundaries: Maintaining personal and professional ethics is crucial, even when under immense pressure.

Notable Quote:

Dan Shapiro [22:27]: "The odds are not great... And the number of companies that are founded and that are successful that are not venture backed exceed venture by a huge margin."

11. Advice for Leaders and Teams

Shapiro emphasizes the importance of self-awareness and complementary team dynamics:

• Personality Assessments: Utilizing tools like the Big Five Personality Traits to understand team strengths and weaknesses.
• Delegation and Leadership Styles: Advocates for CEOs to lead with their core strengths while delegating other responsibilities to capable team members.

Notable Quote:

Dan Shapiro [65:16]: "Understanding yourself in that way, quantitatively, qualitatively, and helping to connect with people who complement your weaknesses as well as your strengths, I think is such an important part of that leadership."

12. Concluding Thoughts and Final Advice

Shapiro wraps up with reflections on the entrepreneurial journey:

• Embrace Challenges: View problems as opportunities and remain focused on solving the work you love.
• Avoid the "Grass is Greener" Mentality: Recognize that every role has its unique challenges and rewards.
• Responsibility and Accountability: CEOs must own their decisions and learn from every outcome, fostering a culture of continuous improvement.

Notable Quote:

Dan Shapiro [60:10]: "You learn to think about what the work is. You don't think about oh, then I'd have independence, then I'd have freedom... Because at the end of the day, those things do or don't come, and they're not the thing that makes a difference every day."

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Key Takeaways

• Persistence Pays Off: Shapiro’s journey underscores the importance of relentless pursuit despite setbacks, epitomized by his 68 rejections before securing funding.
• Ethical Leadership: Making decisions that prioritize employee safety and company integrity, even under duress, is paramount.
• Self-Awareness and Team Building: Understanding one’s strengths and weaknesses and building a complementary team can drive a company's success.
• Passion-Driven Entrepreneurship: Success in startups often stems from a deep-seated passion and a necessity to create, beyond the allure of venture capital.

Conclusion

Dan Shapiro’s story as shared in this episode serves as a beacon for aspiring entrepreneurs, illustrating that building a successful startup is a blend of passion, perseverance, ethical leadership, and strategic team building. Ilana Golan’s engaging interview provides listeners with actionable insights and an authentic look into the trials and triumphs of scaling a $100 million company against all odds.

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Notable Quotes Reference:

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Transcript

[Ilana Golan]

Wow. This show is going to be incredible. So buckle up and I'm sure you're going to enjoy it. But before we get started, I want to ask you for a favor. See, it's really, really important for me to help millions of people elevate their career, fast track to leadership land, dream roles, jump to entrepreneurship or create portfolio careers. And this podcast is all about enabling this for millions of people to see a map of what it actually takes for big leaders to reach success. So subscribe and download so you never miss it. Plus, it really, really helps me continue to bring amazing guests. Okay, so let's dive in.

[Dan Shapiro]

A lot of people celebrate entrepreneurship and say it is the thing you should do. I'm the opposite. It's the thing you do because you have to. Because you're so driven that you can put up with the pain in order to get to the other side.

[Ilana Golan]

Dan Shapiro. He is the CEO and co founder of glowforge. Dan sold a startup to Google and created the most backed board game in Kickstarter history.

[Dan Shapiro]

I actually got laid off and I was terrified and hurt and I read everything I could about startups and went out to go fundraise and spent nine dark months without raising a dime. And I remember getting so much advice that was terrible. I'm like, so how do you raise money for your company? And then when they all don't call you back, then what? And I promised myself that when and if I cracked the nut, I would tell tell everybody. Entrepreneurs who I'm talking to who are new to entrepreneurship will be like, how did you get glowforge funded? Here's the actual answer to the question.

[Ilana Golan]

Dan Shapiro, serial entrepreneur is understatement for this person. He is the CEO and co founder of Glowforge 3D laser printer that is transforming homes, classrooms, small businesses around the world. They raise over $100 million to date. Now, before Glowforge, Dan sold a startup to Google, authored the startup guide Hot Seat, and created a board game, Robot Turtles, that was the most backed board game in Kickstarter history. My family loves it. I can't wait to chat with you.

[Dan Shapiro]

Thank you so much, Ellen. I'm so excited to be here.

[Ilana Golan]

Take us back in time. How did you grow up? Were you always tinkering with different things?

[Dan Shapiro]

I guess I'm the answer to the riddle, what do you get when you cross a social scientist with a computer scientist? Because my parents are both professors. Grew up in a house that was like somebody was always doing research. Sometimes they did research together. And from my dad, I Learned all about technology. And from my mom, I learned all about organizations and people and how they work. She actually was a professor of speech and communications who specialized in organizational communications. So my dad's research was on things like database design and scaling. My mom's research was on things like, is it more efficient to have centralized communication or decentralized communication? And then they would work together on things like, well, what happens if you run those experiments, but with computers in the middle and use computers as a means of communication. I grew up, and that was the dinner table conversation. So that's how you get the tech entrepreneur, at least in my case.

[Ilana Golan]

What years was that? Because I still played Frogger, I think, at this point. Like, it sounds like you were pretty advanced.

[Dan Shapiro]

Yeah, I actually, Until I was 12, we lived in Fargo, North Dakota, which is a very peaceful and calm place to be a young child. My parents were both professors at North Dakota State University. And when I was 12, we moved to Portland. Portland, Oregon, a big city. And we got to go to a really great public school. I was just talking to my mom last weekend about some amazing folks who came from there and had wonderful extracurriculars. It was a really nurturing experience. One of the reasons we decided to send our kids to public school as well and got to do all the things I got to do, Drama and Speech and Debate and Science Olympiad. Because I was a big dork, I didn't last long in drama. I did that for, like, a year. But Speech and Debate and Science Olympiad were the things I, like, poured my heart and soul into after hours, which turned out to be handy skills later in life.

[Ilana Golan]

So you finished school. You were kind of entrepreneurial, if I remember correctly, even as a kid. Tell me a little bit, where did that take you?

[Dan Shapiro]

Yeah, I was always the one looking at an interesting angle and, oh, maybe I could sell this or do that. But when I was in college, I went to Harvey Mudd College, which is a small science and engineering school. I had an engineering degree. It's funny, because nobody told me engineering existed. I thought that was the guy who, like, drove trains. And then I'm like, wait, do you even make stuff for a living? I thought I was maybe going to go into physics, but I didn't love the math. And anyway, so I got very excited and I wound up putting myself through college building laser displays like Pink Floyd, the Wall at the planetarium, that sort of thing. But, like, little ones and selling them on the early Internet on Usenet, and then doing laser shows around the college campus for parties. And then wound up with the DJ business. And that was my first real entrepreneurial endeavor. Lasers would be a theme that would come back much later.

[Ilana Golan]

Oh, yeah, it sounds like you're closing the loop. And we'll get there. So you started in corporate, Microsoft, et cetera. What did you learn there, and what made you eventually jump from that to entrepreneurship? Because it's very, very different.

[Dan Shapiro]

It was senior year, and everybody was lining up interviews and talking about who they wanted, and I was interviewing with anybody and everybody who would have me. And somebody's like, really? You want to go work for Microsoft? It was for some like, no, no, no. This is my not McDonald's interview. They said, what do you mean? I'm like, well, if I get a job offer there, then I don't have to work at McDonald's. And as soon as I get my not McDonald's job offer, then I can be picky. And until I get my first offer, I am not going to be picky. And so I interviewed at Microsoft and a bunch of other places, and I got a couple of offers.

[Ilana Golan]

What year is that?

[Dan Shapiro]

1997.

[Ilana Golan]

Okay, so right before the whole Web.

[Dan Shapiro]

Yeah. Just at the tip of that iceberg. And the recruiter said, hey, we're offering a job. And I said, honestly, I really don't want to go into software. I've studied hardware, and I really want to. She's like, yeah, but we have this thing called a program manager, and so you don't have to be a software engineer, and you've got to be technical. And we've got this thing on the hardware team in Windows. And I was like, well, that's kind of interesting. I've never heard of being a manager when you graduate. What's a program manager? What does that do? And then I said, no, I don't think so. She said, look, I'll fly you out to Seattle, and you'll spend one day interviewing, and then you'll get as long as you want. You can take multiple days, rental car on us. You drive down, hang out with your friends and family in Portland, and you can totally dial it in. You don't have to interview for real. It's okay. I was like, really?

[Ilana Golan]

She's like, yeah, that sounds like a dream.

[Dan Shapiro]

She knew because I went and I met the team, and I'm like, this is amazing, and this is incredible stuff. And I wound up working on Windows 98, then 2000, and then XP, and I wound up program manager, responsible for increasing scope and hardware, and then half the UI for Windows xp and it was this incredible experience of getting to see software built at scale with some of just the best and brightest and to get to see a company through a period of dramatic transformation. This is when Bill handed off to Steve, this is when the antitrust lawsuits happened and, and I got to present to Bill and Steve and have them critique my work. And I got off okay. The person after me got yelled at a lot. So I felt pretty good because they just said, oh, hey, good work, keep going next. And so it really helped to learn a lot of lessons that otherwise I would have had to learn on my own and sort of the hard way. But also I only spent five years there and I feel like that was also good because there is a lot to be learned from those excellent companies that hire, especially at the time, hire just A plus talent. Microsoft was really one of the best places for talent in 97 and get the most from that talent. And there are a million things to unlearn that are not just unhelpful, but actually counterproductive in the startup world. And so getting to learn those things and then what I did next was go to a startup and getting to unlearn them. I went to a startup called Wildseed that was building a Linux based cell phone like Android, but before it was a good idea. When Android did it, we were very early, you know, fork Red hat Linux and build the OS from scratch and build all the apps and everything and build the hardware and spent three years with a bunch of really great, passionate, driven startup people seeing what to do and what not to do.

[Ilana Golan]

It's actually funny because when you said that, I was like, yeah, I got into intel so I won't be a waiter. So it's the same. But what are the things that you feel like you studied in Microsoft that you needed to unlearn?

[Dan Shapiro]

There was something, this just came up at a manager's meeting at glowforge. We started talking about this notion of being a poop umbrella. I think I got this from a tweet which was the emojis poop umbrella. And it was talking about the virtues of great manager. I said great managers are poop umbrellas. That is a company at large just rains down chaos and nonsense and randomization and they don't understand what you do. And a good manager's job is to be a poop umbrella and to protect your team from the company. That's a good lesson at a big company because they are full of chaos and randomness and misunderstanding. And I want exactly the opposite at a startup I want to get rid of the poop. I don't want the chaos and randomness, or at least the useless chaos and randomness. But when there's real chaos and randomness in the company, when customers are changing their mind, when the company has to pivot, when you truthfully are saying, look, we know what feature would to build today, but I'm not sure what feature we should build tomorrow. Don't pretend, don't insulate, don't set people up so they can go work for two years on a project, stick their head up and go, what do I do next, boss? Because at a startup, that's wrong. At a startup you want people who can deal with whatever's raining down. Hopefully it's not poop, but whatever is raining down. You want people who don't get insulated from that. So one of my goals at glowforge is to connect people to what happens at the company, to help them understand what's going on in finance, to help them understand what marketing is doing. Because I've been part of so many conversations and guilty of going like, oh, those stupid marketers. If only they do, you know, they're just off doing whatever. Oh man, finance is so dumb. They're grinding us over this thing. If only they understood how important it was. And then you bring those people together and you start to understand how and why finance does what they do and understand the difference between cash flow and accrual based accounting. What's EBITDA and why does that matter? And suddenly very smart people all over the business are like, oh, that's why you're doing what you're doing. You're not stupid, you're not evil, you have knowledge. I don't. How often do you hear somebody say, I can't understand why insert thing here. And what they think they're saying is you're stupid. What they're literally saying is, I can't understand it. People say like, I can't understand Y X. And they think that they're saying, I know better. But like the literal words out of their mouth are, I don't understand. And I see that so much, especially in big business where each team doesn't understand the others and they assume that's because everybody else's bozos or idiots or misaligned or whatever else. And in a big company it's hard to make it work any other way. There's a lot of value to a manager who can isolate, insulate and let you go do your one thing in your little poop free bubble. And at startups you can't do that. At startups, if it's raining, if it's sunshine, if there's poop out, if it's a wonderful day, you want everybody there in the mix with you.

[Ilana Golan]

What you just said is so, so, so important. And I think it takes a level of.

[Dan Shapiro]

I didn't think you were going to get that many poops in this conversation.

[Ilana Golan]

I know, I know, I know.

[Dan Shapiro]

I apologize to that.

[Ilana Golan]

Hey, you know, each one and his own. No, but this is so true. And I remember one of the startups that I was in was acquired and I remember not understanding why would we go with a competition until the CEO said this one thing that I realized that I just didn't have the full picture right. You could see one little detail, but you didn't have the whole thing. So I love this example. But then you went to found your own company, which is a whole different level of poop, whatever, and then emerge with Photobucket, which I was actually a user of Photobucket. But take me there for a second. When you decide to leave the salary based comfort zone to some extent and start your own, it's a very different dynamic.

[Dan Shapiro]

I had a little intermission. I actually got laid off. I told my manager, hey, I think we're nearing the end. I'm gonna look for other work. And then I remember one day I was washing my hands, my phone rang and I didn't. I was washing my hands and then it rang again. It was my boss. I was like, we called twice in a row and I saw him like 20 minutes ago. And then I picked up, I was like, hey, Peter. And he's like, dan, could you come to the conference room right now? And I'm like, layoffs, right? He's like, could you come to the conference room right now? I'm like, yeah, no problem, Peter. I'll be right over. And so got laid off, had that experience and went to go work at a company called RealNetworks.

[Ilana Golan]

Before that, can you tell me, what was it like? We have a lot of people listening and with a lot of layoffs right now, what was it like?

[Dan Shapiro]

I had the easiest, most chill. I was already looking for other jobs. I totally expected it. It was completely reasonable. It wasn't because I was bad or whatever else. It was because they were doing layoffs and they knew I was going to leave anyway. And it was wretched. I had layoffs on Easy Mode and it was wretched. And even though I had every reason to know why they did it, I Questioned myself. Even though I had active interviews on the way, I was terrified of not being able to ever work again. Oh, my gosh, it's so hard. Because me, I imagine you and I imagine a lot of our listeners, a big part of our lives are what we do. It's part of our identity. It's part of how we spend our time. It's part of how we provide for our families. And having that go up like that is terrifying.

[Ilana Golan]

And I appreciate your saying that. Your entire earth is shaking and your identity many times is attached to the title to the company you're with, which is a big thing that we're trying to prevent a little bit. So you'll have some personal brand and some multiple streams of income to lean on. But I get it. It's scary as heck, but you kind of lick the wounds. And what makes you start something of your own?

[Dan Shapiro]

Well, I had one year in the middle, so I wasn't sure what I wanted to do. And I was terrified and hurt and distressed and so I grabbed a job and it was fun. I ran that games team for a local company called Real Arcade. And it was interesting. When I interviewed, the culture was very 9 to 5. I picked up on it immediately. The pay was significantly less than what I had at Microsoft, and even when I had at the startup, a little less than that. But divide by 40 instead of divide by 60, and that pays pretty good. And I thought, this is great. I can do something interesting and fun. Plus, many men of my generation working at a games company was like the ultimate dream. I'm like, oh, so I get to check that one off the list. That's fun. Get to learn a lot about the gaming world and figure out what I want to do next. So went there and spent a year working on that and just immediately was like, oh my gosh, this doesn't work for me because I want to be passionate about what I'm doing. I want to be fully invested. I want to come home and still be excited about what it was I did during the day and have my family and at that point have my wife didn't have the family yet and the hobbies and everything else and friends. But I did not want work to be a 9 to 5, where I just left because it was over. And so started thinking about what to do next and what kind of company to start. And I read everything I could about startups, which in 2005 was not very much. There were just a few investors who were blogging. David Cohen, August Capital, I think, and Brad Feld, one other who I'm forgetting. And I read every word, devoured it, and then went to all the coffees and all the networking and everything else and finally found a friend. And we came up with an idea for a concept which was basically a service that synced your dumb phone because this is in the pre iPhone days. Synced your dumb phone to the cloud and to your PC and decided to go. So I quit my job and became the full time CEO of Ontella, which is what we were called at the time, and went out to go fundraise and spent nine dark months without raising a dime. Nothing. That was my full time job. Not only was I failing at it completely, I literally had nothing to show for it. It's not like I had small checks or term sheet, like nothing. And it was nine months before the first check cleared.

[Ilana Golan]

This is so important because most people after the fifth meeting they give up and they say, never mind, I can't do it. So talk to me a little bit about trying again, again and again, getting back up and continuing because it hurts.

[Dan Shapiro]

I got so hyped up on caffeine for my five coffee meetings a day. I would have coffee with anyone and everyone. This is back to the not McDonald's thing, right? I got a lot of advice that was like, pick your 5 target investors and really invest your time and energy and make that work. I'm like, nope, I will talk to anything that moves. I will pitch anytime, any place, anywhere. Anyway, I'm a tape. You walk up to Dan, you push the button, you get the pitch. That's it. And I remember getting so much advice that was terrible. I'm like, so how do you raise money for your company? Well, I mean, you go to your network and think about who the investors in your network are. And I'm like, what are you even on about the investors in my network?

[Ilana Golan]

I don't have any.

[Dan Shapiro]

Yeah, how do you solve the problem? Well, start with your solution. And I'm like, no, that's not helpful. And I would get this just so pitching thing, like you put together your pitch deck and you schedule the meetings and then you do the follow up. And I'm like, yeah. And then when they all don't call you back, then what? What actually happens to get you across the line? And I promised myself that when and if I cracked the nut. Confident, but not blindly confident. I thought I was going to, but very much accepted the fact I might fail. When and if I cracked the nut, I would tell everybody I was not going to keep this knowledge, I was not going to get sucked up into that. Now that I've been successful, all that I remember is what it's like to be successful. I would share that with the world. It's funny, as a side note, entrepreneurs who I'm talking to who are new to entrepreneurship will be like, how did you get glowforge funded? And I'm like, I don't mean to be critical, but that's totally not the question you want an answer to. What you want to say is, how'd you get your first company funded?

[Ilana Golan]

Exactly.

[Dan Shapiro]

And let me tell you.

[Ilana Golan]

Well, that's why I'm going there. Y.

[Dan Shapiro]

It was nine months of pitching anything that moved. And here's the actual answer to the question. There was this guy who is an investor in Seattle. All he did was telecom applications straight down the center for us. And I'd been trying for the entirety of that nine months to get a meeting with him. And every time I'd gotten no answer or blown off or whatever else. Gotten some introductions, hadn't amounted to anything. Nine months in, I bought the budget tickets and you know, we're going to share a hotel room with my co founder. At this point, there are three co founders with my co founder. To Barcelona, which had the world meetup for mobile. He'd worked at Lehman for a while, so he got us an invite to the fancy Lehman Brothers mixer. Lehman was the big investment bank. Yeah. Consultant that went bankrupt, but at the time was a big deal.

[Ilana Golan]

Yeah, not for long. Yes.

[Dan Shapiro]

And I'm like, okay, put on my suit. Target rich environment, here we go. And I was going around chit chatting and trying to. And I saw him, the guy who I've been trying to connect with. And so I ran into him at the bar and said, what company are you with? Oh, that's interesting. Where do you live? Seattle. Oh, my gosh, what a coincidence. I live in Seattle too. What sort of work do you do? You're an investor. Oh, my gosh. Oh, that's really funny. What do I do? Oh, we have this company. What do we do? Here's my pitch. Yeah, no, that'd be great. I can't believe we've never run into each other. Yeah, we should get together back in Seattle. He was the first check.

[Ilana Golan]

Wow. Unbelievable.

[Dan Shapiro]

Here's the terrible, horrible truth. The grand truth I learned was I don't fricking know. Bang your head against the wall until you make a hole. That's the most uninspiring and useless advice. Right? I don't know what it was that got it done, it was just dumb luck. And sometimes all you can do is work until your luck changes.

[Ilana Golan]

But you did kiss a lot of frogs and I think there's a lot to do with that. You can't quit after your 10th meeting and say, that's it. I will never make it happen. Tell me also, Dan, what happened around the home as well, because you might get questions from a partner like, can you get a job? This is ridiculous.

[Dan Shapiro]

I think there's two things. One is entrepreneurship. I think a lot of people celebrate entrepreneurship and say it is the thing you should do and recommend it to everybody. I'm the opposite. My advice on entrepreneurship is it's like becoming a professional athlete or artist or singer. It's the thing you do because you have to, because you're so driven that you can put up with the pain and the high risk of failure in order to get to the other side. Our country creates venture backed companies at a lower rate than it creates Olympic athletes. Every year there's more people who become Olympic athletes on average than become venture backed. The odds are not great. And by the way, as a side note, the number of companies that are founded and that are successful that are not venture backed exceed venture by a huge margin. So the first thing is, are you passionate about entrepreneurship and creating something? And the second question is, do you actually need venture to do it? Because spoiler alert, most companies don't. Most companies are better off without it.

[Ilana Golan]

Leap Academy right now is not venture backed and we don't need it. We're one of the fastest growing companies. Let's go.

[Dan Shapiro]

And you should not take that check unless you need everything that comes with that check. I just had a friend who was asking me for advice about venture financing and I was like, first off, if you do do an investment round, please include me. I generally don't invest, but sometimes I fall in love with a friend's thing and I was in love with this and I was like, please let me. And I was like, so now I'm going to argue against interests and I don't think you should do it. And at the end he's like, yeah, no, you talked me out. I'm sorry, I won't take your money, I won't take anyone's money. I'm going to keep going. And I'm so happy for him because that's the right thing for that business. The advice is you really have to be passionate enough about it to drive you through that. And you have to be lucky. And luck comes In a lot of different ways. Probably the biggest one is the degree to which privilege correlates with success. So privilege of having the resources that you can go at for a while, and then you can spend nine months banging your head against a wall with no income. And I talked to my partner and we'd agreed we could do a year of this before I had turnaround. So my clock was ticking. It comes with white men. Get venture backed at a rate that dramatically dwarfs everybody else in the industry. Totally and wildly unfair. I was doing it on easy mode. I was a white man, and it took me nine months of banging my head to get there. The unfairness of our society contributes to this, because if you're a white man, you have an enormous leg up on everybody else. And any way in which you do not fit the standard mold can dramatically and unfairly harm your odds of success. And so I was doing it on easy mode, and it was still profoundly difficult, and I almost failed. Maybe that's a reflection of me as a poor entrepreneur, that I had everything to my back and still almost blew it. But you kind of have to sign up for that level of trial and tribulation, and you have to be ready to fail. I see the stories of people who mortgaged their house and went deep into debt to make it work, and I'm like, I don't know that that's the thing. Because for every one of those that you hear about that works, there are more that don't. So you kind of have to decide to only bet what you can afford to lose. You have to understand the degree of commitment and passion that's necessary to take you through all the trouble and to know that there's tremendous opportunity and joy and wonder. But there's a lot of roadkill.

[Ilana Golan]

I love that you're so honest about it, Dan. I think one of the things that I tell people, and I don't know if I realize that there's a huge difference between number one and number two. And if you're comfortable with being two and one of the later one, that is always so much easier than trying to run the show. But you then merge into Photobucket. How did that come about? You get your investment, you suddenly become. I don't know. I mean, I know Photobucket. I think most people our age will know it. That was kind of the pioneer.

[Dan Shapiro]

Yeah, it was a wild adventure. We basically had Photobucket as our biggest partner, and they were quite large. They'd been bought by Fox Interactive for about a quarter billion dollars because they were part of the Web 1.0 wave. And I put together this wacky deal where basically I bought them for glowforge common stock and then renamed the company to Photobucket and merged the companies together to set the company up for the next wave of opportunity, which was mobile, because that was a point when Instagram was a tiny little crappy app on the App Store that was not getting much traction yet, or was just starting to get traction, and it was the earliest days, and. And it was anybody's guess how that was going to shape up. I had a meeting with Mark Zuckerberg when Facebook was like a hundred people, and they were pitching that we would go write their mobile app. And I'm like, this is a terrible idea because you're going to write your own mobile app, and if we do it, you're going to be mad at us, and then you're going to get rid of it as quick as you can because you're going to want it internally. Like, I know how outsourced development works, and I know how this sort of thing works. You've got more money rolling around here than anything. You're going to be unhappy with whatever comes out. What wound up happening was we turned them down. They hired somebody else to write their mobile app, one of our competitors, and it unfolded exactly that way. They were frustrated and replaced it with their own app months later, and it was a huge waste of time and totally distracted our company. But that was the plan. And in the course of all the horse trading that went through, we wound up in this sort of complicated political situation where the leadership of Fox and Photobucket and I all did not see eye to eye. So I said, great, I'll step out. And they said, no, no, no, you can't step out. You got to stay as chief strategy officer. They said, chief strategy officer is chief officer in charge of quitting. So is that what you want? Because we could just cut out the middleman and like, no, no, no. Okay, be chief Technology officer. I'm like, okay, we'll give it a shot. Six months later, I'm like, are you done with me yet? They're like, yeah, no, because it was a thing where it can be really valuable to have somebody who has a different view, who has a different perspective, who has a different direction. And the leader of that business, who was actually somebody who had come from glowforge, was my chief financial officer, who's fantastic in that role now, had to please Fox and had to please the glowforge investors, and had to do this and that. I'm the one who's like, yep, okay, fire me if you don't like it. Here's what we're going to do. And he's the one who's like, I'm going to try and find a way to make everybody happy. So I wasn't helpful. I was trying to be helpful, but I wasn't helpful.

[Ilana Golan]

Well, but the truth is they didn't make it to mobile. All the rest came and I think replaced them.

[Dan Shapiro]

It was the classic problem where they said the first order of business is to make sure we don't mess up the web operation and mobile has to be second. I was the one who's like, make mobile first. And everybody's like, no, we have to make sure the web business is solid. And it took everybody's full time energy to make the web business solid, which was a dying opportunity and eventually went to zero and never got around to the mobile business, which could have been. It was classic innovators dilemma.

[Ilana Golan]

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[Dan Shapiro]

So I still had a chip on my shoulder and I still wanted to make it work. A lot of entrepreneurs have a chip on their shoulder. Me actually less so than many that I know. But I've definitely came out feeling like, oh no, I've got to make something work here. It was great as far as it went, but this isn't headed in a direction that I'm going to be proud of and I want something to be proud of. And I had a bunch of harebrained ideas and also I needed to buy a laptop and Windows laptops are complicated and a mess. And I made this spreadsheet and then I hired somebody in Pakistan to go and research every item on the spreadsheet and type in all the details and I was like, filter, filter, filter, sort okay, that was cool. That was kind of neat. So I flew down to the Bay Area to talk to. See, now I had investor friends, just like all those people who I sneered at. And so I went down to go talk to my investor friends and say, what do you think of this? Because in the process of pitching Photo Bucket over and over and over again for all the various runs, I met a lot of people. By the way, just to give you numbers, in February of, I can't remember which year, I got a term sheet for our Series B. I started on January 5, and I did 68 pitches between January 5 and the last day of February and got a term sheet from the 68th one. So 67 nos. 67th one was a yes. And I made Alaska MVP, 50K, whatever, in February, flying all over the country. So beat your head against the wall until you make a hole. Right? That was the approach. So I flew down and talked to a bunch of people, and I was like, I have these three ideas in the stupid spreadsheet, Three interesting business startup ideas, and by the way, the stupid spreadsheet. And on the way back, I hate talking to people on planes, but my rule of thumb is if I get upgraded to first, or if I'm flying to and from the Bay Area, I'll talk to the person next to me on the plane. It was just like my obligatory networking. And this was both. I was flying back from the Bay Area and I was upgraded to first, and the guy next to me worked for Google, and he said, what are you working on? And I have, like, these three ideas. And I explained, and he's like, oh, it's really interesting. I was like, and this one stupid spreadsheet thing. And I showed him what I'd done, and he's like, that's amazing. If you build that into a business, please call me if you start building that. I said, great. Thank you. Great to meet you. Shook his hand, lost his business card promptly. That was the end. Wound up falling in love with the idea of building a service that would help people find the right product by bringing better data and creating a massive data store that would let you surface what the product that best met your needs was launched on TechCrunch with 500 invitations. Because my CTO was like, we can't do it. It's not ready. I'm like, it's fine. It's ready enough. He's like, no, it'll follow. I'm like, well, then limit to 500. That was our negotiated agreement, was that we would Launch with only 500 tickets. Matt from the plane got a ticket. 487 emailed me immediately and said, I'm the guy from the plane. You did it. We should talk. Oh, my God. Google acquired Spark Buy three months later. And same lesson from chapter one. It's just luck. It's just random. I sometimes say part of the responsibility of being a CEO is you're also the Chief Serendipity Officer. You're the one who chases down all the weird blind alleyways, because one time you stumble into the fountain of youth or whatever you find out. When you go down 100 blind alleyways, sometimes you find whatever it is that you wanted or didn't even know you needed.

[Ilana Golan]

But I will say that I think one of the confusing pieces is that as a CEO, you're going to need to wear a lot of hats. And I think sometimes people come with, I'm passionate about X, but you're actually supposed to put your sales hat on, your marketing hat on, your management hat on. You're actually not going to usually do a lot of what you're passionate about. You're actually going to do all the rest.

[Dan Shapiro]

I have this theory about CEO superpowers. I'm going to rewind at Glowforge. We're a pretty big company at this point, maybe 70 people. And I had an executive who I just promoted who was really frustrated. She'd taken over the marketing team and did not have a ton of marketing experience, but had deep product and analytics experience, which is what I wanted, and had a background as a. I think it was Anderson or something like that, consulting. And I knew she could do an amazing job at this, and I knew she'd require a lot of guidance. And she was trying to find, how do I balance the fact that you're trying to empower me and have me do great work with the fact that you have a very clear idea of how you want things done. And you're giving me a lot of feedback. And so the idea of I'm your training wheels and I'm going to keep you this way for a while, and then once you've got that, then I'm going to come off and you're going to be able to lean all the way over, and I'm going to sit there going, that's not how I would do it. And that's going to be fine, but first we're going to learn. So we had these conversations. There was one point, though, that I remember. She said, hey, Dan, my startup experience comes from the valley and the height of CEO achievement is delegating everything. The CEO's job is to delegate everything. So I get the sense that that's not the way you think about it, but like your ultimate success is to have everything delegated. How do you think about that? I'm like, oh man, I don't know. Such a good question. This is one of the reasons I loved working with her. Marlo Struve is her name and knew that she would do great at this is because she had that deep, questioning mind, in this case, challenging me at the very core of what I did, but in a way that got me really thinking. And I realized that as I thought back, the CEO role models who I got to see reasonably close and who I really learned from were folks like Bill and Steve at Microsoft and Larry at Google. And the description that I use for them is lead from the front and lead with their strength. I'll just give you an observation. Under Bill, Microsoft was a technology giant, arguably one of the best technology and product companies. Very arguably. Everybody loves to debate that. Under Steve, Microsoft had one of the best sales practices in the industry. Product and technology were kind of a second tier. Bill led the company with his strength of technology and product, not just in the sense of him demonstrating how to do it and doing a chunk of it, but he actually formed the company around his strength. So it led with that and he delegated all the sales stuff to Steve, who did a great job. And then when Steve took over, Steve took over and led from sales from the front and the strategy of the company started to be sales first. And he delegated the product and engineering to smart and capable people and that took a second chair. You saw the same thing with Eric and then Larry leading Google. And so I think about that as what's your core strength? In the earliest days, you're going to have to do everything. But if you're the right CEO for the business, then your greatest strength and passion is going to let you lead with that from the front. You're going to be the business that mines every penny, because the CEO leader understands finance deeply and can build a more efficient operation than anyone else. Or you're going to build the most technically sophisticated product that succeeds because of its technical excellence, because that's where the CEO comes from. There are CEO general managers who just delegate everything and manage everything well, that can work. But the model that I understand and live and connect to most is the CEO who leads his or her company with their strength and passion. And that is the North Star for the business. What's been your experience. How do you think about that in your business?

[Ilana Golan]

I am very much a delegator because I feel like once I figure out something, I want to almost get rid of it so that I can focus on the next big thing. And sometimes I delegate too much and then I need to like, oh, never mind, let me rewind for a second. Because nobody caught that.

[Dan Shapiro]

I think they both work and they both work beautifully. And it's a matter of, as a CEO and leader, understanding what's the model that works for you?

[Ilana Golan]

This is such a great discussion, but I want to go to Robot Turtles for a second because you then sell to Google and again, you don't go and just lean on the beach, whiz margaritas, which sounds really good actually at this point. But you decide to start another thing. What happened?

[Dan Shapiro]

So after two years at Google, I was the CEO of a wholly owned subsidiary called Google Comparison Inc. I was helping a friend with his project. He was working in television. And we put together a pitch for a TV show that was Kickstarter meets Shark Tank. That was the idea. And we had a lot of success. We had to take it to a production house, they took it to Sony, and things are going great. And I'm like, I should figure out Kickstarter a little more than just backing. I should put something on Kickstarter at the same time. My twins were four. If a boy and a girl, they see them blurry behind me now, 16, but at the time four years old, they were just old enough for board games, which I love. And my board game options were things like Candyland, which I loathe. And I'm like, how do I teach my kids the joy board games without having to play Candy Land? And then totally separately was really frustrated because I learned to program in high school and dabbled a little here and there, but I terrible at it. And I wanted to pick up a modern programming language. And every time I looked at the options there, I'm like, these are languages designed for people who know them already. And they're languages designed around the idea of being represented in ASCII text. And that seems so backwards. What would it look like if you had a language that was not designed to be text? What would it look like if you had a language that was designed to learn rather than to be mastered? And somehow that idea and the board game thing kind of squished together. Had this idea for a board game where the kids would play the game by writing code. And then the click that went off my head was and where the fun part for the kids is that they get to boss around grownups just like programmers boss around computers. And this was something that, as I was thinking about values I was trying to impart to my kids. It wasn't I want you to be programmers. No, no, no, not at all. But there was this thing that, this learning style that I had and I don't quite know where it came from, where I would just try stuff and I would read stuff and I would pick stuff up and I'd be kind of skeptical of the knowledge in the textbook and I would really lean into the knowledge that I found on my own. And the things I tried and didn't work, I was very sort of experimental. And one of the things that I loved about programming is that you can learn by failing in almost all of education.

[Ilana Golan]

And it's really fast, really fast.

[Dan Shapiro]

Most of education you learn by avoiding failure. You don't try five answers on a multiple choice question, get the last one and go hooray. I figured it out. You failed four times. But it took to get. That's silly. And almost all school is like that. You learn by getting it right the first time. You learn by studying and then perfection. And so I said, okay, what if we literally made it impossible? Because there were no rules except you boss around your parents and the parents were the ones who knew the rules. But there's no penalty for being wrong. So the kids just get to try stuff and see what it does and learn by doing. And there's no penalty. There's a bug card, as you know, you hit the bug and you say bug and you get to undo what you did and you don't lose any moves and there's no penalty. And kids would enjoy it. They'd sometimes make make mistakes on purpose because it's fun to undo them. It's fun to make the parent do it. And so that notion was really the core of the game. More so than loops, more so than order of operations, all of which are in there. It was this idea of doing that. But the magic moment for the game happened when I was talking to a friend of mine, John Weissman, who owns Calliope Games board game publisher. I don't usually out her because she was actually the villain of my Kickstarter campaign. Oh no. I was talking to her about the game and she said two things. She said, one, make sure it has four players, four player games, where the market was at. So I was like, okay, great. She said, and second, you talked about board game companies. They would Never publish this. I'm like, why? And she said, because it requires a parent. And board game companies have tried games that require a parent, and they don't sell because parents say that they want something to do with their kids, but what they really want is to shove their kids in the corner with a board game. And I said, oh, oh, oh, Don, can I make you the nameless villain of my campaign? And she said, what do you mean? And I'm like, I want to say a board game executive told me that nobody will ever publish this because board game executives know parents don't want to spend time with their kids. And the only way that this Kickstarter will happen is if you prove them wrong. And that became the rallying cry. It's true. That became the rallying cry of the campaign is this game will only exist if you bring it to life. Because the board game companies think that you don't want this. So let's show them that they're wrong.

[Ilana Golan]

Amazing. So you make her a villain, and that's what made the Kickstarter so successful anonymously.

[Dan Shapiro]

Because she's a dear friend. I did not out.

[Ilana Golan]

No, no, no. No shaming. No shaming.

[Dan Shapiro]

No. She was happy to do it. And by the way, the happy end is that it's published by Think Fun, which is now a subdivision of Ravensburger, and they are wonderful, and they've given it a great home. Still for sale today, and for a while was everywhere. Moma, Target, et cetera. And it's still in museum gift shops and specialty game stores, which is really gratifying.

[Ilana Golan]

But again, what made that Kickstarter so successful? Because a lot of people are trying Kickstarters and most of them go kind of silent.

[Dan Shapiro]

You know, I was listening to your conversation with our mutual friend Tim Riley, who is amazing thinker, and just a few episodes ago, he was talking about how he didn't market his book. I think it was a book that he was talking about. He didn't market his book about the web. He marketed the Web and his book came along for the ride. That idea that the product that you're doing represents something and the thing it represents is way more interesting than the product itself. I think that's what it's about. And so I wasn't selling a box of cardboard. I wasn't selling a board game you can play with your kids. I was selling the idea that your kids can learn even before they can read, can learn structured thinking, can learn to learn by trying instead of learn by being taught, and can have A wonderful experience with their parents. It's positive and collaborative. That's what I was selling. And that sells a lot better than I was going to say. The questionable art on the COVID The art's great. I'm relatively proud of it. There is one funny story that I don't know I've ever told this publicly before about the art on the COVID Oh, my God.

[Ilana Golan]

I want to hear it.

[Dan Shapiro]

I went to a high school reunion and I mentioned early on I went to a great public high school, Beaverton Public High School, and I ran into a skateboarding buddy from seventh grade whose name was Angus McLean. He asked me what I was working on. I was like, this. That. The other board game thing. I asked him and he's like, actually, I went to Rhode Island School of Design. I went to Pixar. I never left. I said, what are you working on? He said, I can't tell you. I said, okay. He said, can I see the art? I showed him. And he kind of scrunched up his face and looked pained. And I'm like, what is it, Angus? And he's like, the eyes are wrong. And I was like, oh, what's wrong with him? He's like, can I draw eyes? I'm like, okay. So he literally pulls a Sharpie out of his pocket, grabs a cocktail napkin on my phone. He's looking at them and he draws the eyes. And I'm like, oh, my gosh, those eyes. You're right, those eyes are awesome. Like, can I use this? And he's like, yeah, no problem. The thing that he was working on that he couldn't tell me was co directing Finding Dory. So Angus McClane is legendary Pixar artist, which I didn't really realize at the time, but yeah, the eyes of robot turtles are Pixar artist extraordinaire. That's where they came from. And Angus and I reconnected and been friends since. But yeah, that was the one thing about the art I was really proud of. He delivered on that. Everything else was a contractor I found on, I can't remember which contracting site who did great work. And I was really happy with it. But at some level, it was me as art director. I don't know what I'm doing and somebody who's working on a fixed rate putting that thing together. But the thing that pulled it through was that it ultimately connected to something that really reverberated for people. And I think that's true of everything. I think that's true of what we do at glowforge. It connects with this desire of people to create and the thing that we're selling. It's a neat product and it's transformative and it impacts people in meaningful ways. But the reason people buy it isn't because of what it is or what it does. It's about what it can make them feel and what it can do for them and the way it can change their lives.

[Ilana Golan]

Let's talk about glowforge a little bit, because I love also how it's not about selling a vision, but you're talking about the vision, not necessarily the product itself, or not necessarily the details and the minutiae, but really it's about what is the possibilities. So talk to me about Glowforge. You're starting it in 2014. First of all, how do you juggle the things? Because Robot Turtles is still going on. How do you do all of it?

[Dan Shapiro]

So I'd gone through the process of, like, we'd finished the Kickstarter campaign and I'd gotten a US based game manufacturer. There are not a lot of those left to manufacture it. And I'd organize logistics to get everything shipped out, and that'd all come together. And then somebody had suggested, oh, you should do a deluxe 3D edition. Actually, Luke Crane, who ran games at Kickstarter, he said that would be something people would really get a kick out of. And so I said, okay, all right. I've always wanted to try a 3D printer. I'm going to go to the local makerspace and I'm going to try 3D printing a turtle. So I got my laptop, got ready, went in, and they, like staged an intervention. They're like, you don't want to 3D print your turtles. I'm like, why not? And like, you're not going to be happy. I'm like, what do you mean? Like, I'm here. Look at all the 3D printers in the window. And they're like, it's going to be ugly and it's not going to work the first three times. And you're going to be mad at us because it's going to cost a lot of money. I'm like, but it's like 50 cents a minute. Like, you want to use the laser in the back. I'm like, that's $4aminute. Like, yeah, but it's going to take you like an hour to do the first one. And. And I'm like, looking at these people, I'm like, you're traumatized. These 3D printers have hurt you. And they're trying to talk me into using the laser. I'm like, okay, look, I promise I will not be upset. I'm going to 3D print a turtle, and then I'll laser cut a turtle. Okay? Okay, so I 3D print a turtle, and sure enough, it's a pile of blue spaghetti. And then we try again, and finally we get the turtle. It's, like, hairy and lumpy and, you know, one color. And. Okay. And I'm like, that is not a thing that I want to offer to the people who back this vision. And then I'm like, how do we do the laser? And I tried cutting it out of acrylic, and I was basically sitting behind this barrier While a woman who was operating it was doing. I'm like, could you. I want to touch. I can't touch because it's big industrial laser, and she's trained, and there's all these safety things, and I wanted to try, and I wasn't happy with it, and I said, okay. Oh, boy, what am I going to do? So one thing leads to another, and I wind up with this industrial carbon dioxide cutting laser Imported from a factory in china, installed in my garage. And I come up with this idea of taking a photo print and then laser cutting around the photo print so you get these beautiful little tiles that actually look great and are physical and tactile. And the brief for this was a friend said, I want something that my kid can shove in his pocket and carry around all day because he loves the turtle. And I was like, okay, that qualifies. And so we did. I say we, but I don't know why. Because it was just me did this deluxe laser edition because it was laser cut, and because the turtles had lasers on their backs. Side note, the reason the turtles have lasers on the backs Was because I built the ice walls, which are one of the features. And I was playing with my daughter, and she said. And she had a very low, scratchy voice at the time, and she said, I want that wall to go away. And I was like, okay, well, how should the wall go away? Do you push it? No. Do you pull it? Nope. I'm like, do you make it go away with magic? And she said, lasers. And I'm like, I can do lasers for you, honey. That's where lasers came from. And that impression does not capture the adorable nature of my young daughter. But that was where the lasers came from. Like, oh. So this is the special laser edition. It's laser cut pieces. It's great. So literally, we had a family vacation to Hawaii And I was late in getting to the car and driving to Hawaii because I was trying to run the last batch of these to get them shipped and out. So I was making everything in our garage with the laser cutter, and it was amazing. And I said, this is something truly remarkable at a time when Everybody's talking about 3D printers is, oh, just dream up whatever it is and you can make it. This is actually delivering. It's not lumpy plastic. Slowly. It's beautiful things made quickly and done out of materials that people actually care about. And I invited this whole parade of entrepreneurs to come by my garage again. Things you can do on your fourth company that you have access to that you don't. Otherwise. Investors and entrepreneurs came by, and I'm like, look, I'm going to make you some schwag. And they're like, you're insane. What are you doing with this industrial factory tool? And then I do the thing like, okay, that part where you push the button and the cool thing came out, like, three minutes later. That was neat. I like that part. And like anything else. And I was like, okay, how could we just distill it down to its essence? Where you push the button, you get the beautiful thing, but it sits on your desk, and it's simple and it's easy to use. And that's how glowforge was born.

[Ilana Golan]

Incredible. And you've been at it for, what, a decade? A decade in the decade. So from a little toy, in creating turtles, you actually created a decade for yourself and raised over a hundred million dollars.

[Dan Shapiro]

And it's still a thing I love every day when I think about my superpowers, one of them is love to make stuff. And I love making things with our product. I mean, stupidest thing. But last weekend, I had to fly down to San Francisco and realized that my laptop was missing. And I, like, turn the house upside down because I have to leave in, like, an hour, and I cannot find my laptop. And so I'm like, okay, we're going to do this raw. I'm going to be using my phone. I found a Bluetooth keyboard. And then I'm like, I need a stand. And so I'm like, okay, I'm going to print a stand. So I grabbed a piece of plywood, throw it in there, go into the catalog, find the stand, and I'm about to hit print. And I look at it. I'm like, no, I want. I want to put magnets in it so it's easy to carry. So I immediately go over and draw my entire thing from scratch. And I'm like, okay, I'm going to design it my way. And meanwhile, I'm ticking down to when I have to head to the airport. And I put together this little thing which is like my.

[Ilana Golan]

Oh, my God. He's showing us on YouTube, by the way, for those who are looking, for.

[Dan Shapiro]

Those who can see. And it has little magnets in it so it snaps together so I could carry it in my backpack. There you can hear the snap. And it held my stand on the plane, and it was great. It all worked. It came together. The ability to just dream something up and be holding it literally five minutes later, still magic to this day.

[Ilana Golan]

And again, I think there's another element that you help hundreds of thousands of designers produce hundreds of millions of custom products now that you've been at it for a decade. What are some of the challenges of building something so big?

[Dan Shapiro]

It's really different Goforge at a scale that I've never led through before. And honestly, doing it has been like nothing I've ever imagined. In particular, because of the strange transformation of the world during COVID which was something that impacted all of us in unusual ways. But for me, there was something really profound. I mentioned my not McDonald's job, but I also. I had one set of parameters, even before I got my not McDonald's job, that I wouldn't interview for. I didn't want to interview at a company where if I was bad at my job, people would die. So no medical companies. And I didn't want to interview at a company where if I was good at my job, people would die. So I didn't talk to military companies. And that's not because those jobs aren't important. Obviously they are. I just didn't want to be on the line for that. I am willing to take on tremendous personal responsibility, but at the end of the day, I did not want those stakes for what I did. And when I realized that I was going to have to make decisions for 100 people at my company at the start of COVID that were literally life and death. Like, do we try to keep running the company and risk people dying, or do we shut things down and risk losing the company and 100 people being out of work at the start of a pandemic, I didn't like that. That was not what I signed up to do when I signed up to be CEO. A lot of responsibility, yes. That really changed me in the way that I thought about leadership, because I very much had the. I was not here to do this. And I was not chosen for my ability to do this. And this is not what I expected. And yet here I am, and I have to make the best of it. And it was tough. There was one moment that I recall when I was standing right over there. I work for my basement. I go into the office once a week. We have about 80% remote now and about 20% in person. But I was down here in the basement at the very start of things, and I learned that the factory was going to shut down production unless we falsely claimed we were medical equipment. With a big elbow elbow of like, you can falsely claim your medical equipment and it'll be a long time before anybody figures it out. And what did that mean? That would mean at the time, that factory was in Mexico. We've since moved production back to the U.S. but at the time, that meant 70 folks who worked in the factory were all going to go into work without proper ppe because it wasn't available at that point to go make our products at great personal hazard and decided not to do it and said, okay, this may cost the company, but I think it's the decision I have to make. And then two days later, they found stocks at ppe. They got permission from the government to open, they put protocols in place, and everything became okay. The problem was solved through a different channel. And that, oh, I did not mean to be here. I did not mean to be holding these precious things in my hands, but here I am and now I've got to do it. I think that in many companies that happens, and it often happens in little bits when we least expect it. I was just talking to my leadership team today about how I'm sort of a weird aficionado of the stories of terrible CEOs and people who've done horrible things. And I'll look at something like Theranos, and I'll say, what if Elizabeth Holmes wasn't evil? What if she wasn't a cold, calculating profit optimizer? Just hypothetically? What if she was actually trying to do the right thing? Is it possible that she could have gotten herself into this accidentally? Because if so, that's terrifying and I should really understand it. So I went and read Bad Blood and, you know, the truth is somewhere in the middle.

[Ilana Golan]

Great book, by the way. And I still think that eventually she did start really trying to do something good. And there was a little bit of the fake it till you make it Silicon Valley thing that went too far. But with Hells, it's hard to play, right?

[Dan Shapiro]

Yeah. If I look at it charitably. And that could be the wrong way, but for my purposes, it's the right way, because I'm trying to look for the cautionary tales from me. And if I say that happened because she was bad, I'm good, then I don't learn anything. And then I just saunter on saying, whatever decisions I make are fine because I'm a good person, so everything I do is fine. And that's dangerous. If I look at that and say, she thought she was a good person, maybe she thought she was trying to do the right thing, she got into trouble anyway. Now there's lessons to be learned. When the very first demo that doesn't work and you're like, well, let's just do this one thing. You know what? Every company that I've worked at, I won't even talk about companies, but every company I've worked at, Google, Microsoft, Real Networks, everybody did that all the time. Apple was just called out by Axios because they demoed whatever it was. And it was like, why isn't that ready? And they're like, well, it was ready for a demo. We couldn't get it ready for production. It's like, okay, that's the thing that happens. But there's this very slippery slope where you go from like just this one demo, just this one time, to when you're faking an entire company and it's easy to slip down that slope from the outside. It's easy. Well, you just don't even take the first step. I don't know successful companies that only demo things that are ready to ship, that don't press the edges around a demo, just to pick on that one example. And so I look at those like, where do people go off the rails as a way for me to learn myself where the boundaries for my ethics and my judgment need to be. And it's hard because when you're the one ultimately responsible for the decisions of a company, it all winds up coming back to you.

[Ilana Golan]

That's a lot of decisions. And you're holding a lot of lives and families and whatever in your hands because all these families are depending on you and your success and your vision and your continuing to inspire, et cetera. It's a lot of responsibility, whether we like it or not.

[Dan Shapiro]

And that's why I called my book hot seat startup CEO guidebook. Those are two different things. It's the guidebook for startup CEOs. Startup CEOs are the ones in the hot seat, the ones that have to make the decision and who no matter what happens, are responsible for the outcomes. I'll often joke with startup CEOs and I'll say, good news, bad news. The good news is you never sit there wondering, is this my responsibility? Because it's always your responsibility. It's great clarity and I find that very clarifying because I don't have to do all the mental gyrations of blame or finger pointing or anything. I can start from a place of peace and go, this was my responsibility. Is it my fault? I don't know. Sort of. Doesn't matter. That's my responsibility. And blaming a person and saying it's their fault and they cause this to happen at the end of the day, maybe that's useful. Probably not. If I can start from going, it's my responsibility. I can just cut through a lot of that noise and be like, okay, if I'm responsible for it, how do I learn from it now I do. How do I do better next time?

[Ilana Golan]

Dan? So with everything that you learned, what would be something that we kind of look at yourself or some of the people who are listening, what would you tell them?

[Dan Shapiro]

There's this thing I've thought to myself so many times over the course of my career, which is, well, that would be a good problem to have. I just need to get financing. And I see all these people complaining about how hard it's, okay, you've got a million dollars in the bank. I'm thinking of my first series A. How are you going to spend it? That would be a good problem to have. You've got investors who are trying to hold you accountable for, like, you know what, they're never good problems to have. There's always this grass is greener about the set of challenges. And it's funny how through careers that leads up, I've often teased investor friends, why would anybody become a venture capitalist? Why would anybody become an investor? And I have this theory that it's because you get your first job and you go, my boss is an idiot. I could do their job better. I'm going to be the boss. Then you're a boss. And you go, my CEO's an idiot. I could do their job better than you're a CEO. And then you go, my investors are idiots. I could do their job better. And then you're an investor. And then you look around and go, oh, crud. So the grass is always greener. Like some other problem always seems better. And what do you learn from that? You learn to think about what the work is. You don't think about oh, then I'd have independence, then I'd have freedom, then I'd have an expense account, then I'd have these. Because at the end of the day, those things do or don't come, and they're not the thing that makes a difference every day. The thing that makes a difference every day is, are you solving the kinds of problems and challenges that you love to do? Are you working with people who bring you joy or at least intrigue and excitement? At least make your life interesting, if not joyful. And if you find the right place for that, then wonderful things can happen. But the path to that isn't always obvious. It's funny. We had an executive session where we got together and we're talking about the future of the company. This is some years ago, and one of the things we did was we took a big five personality disorder. So for those of you who know Myers Briggs, Myers Briggs is the pop culture for sale version of the academic version, which is the big five personality disorder. So the actual researchers tend to use big five, not Myers Briggs. And one of the reasons for that is in Myers Briggs, everybody's a special happy snowflake. Whereas big five will tell you you're neurotic or have negative emotional externality is, I think, their nicer word for it. It's not all fortune cookies. It is real talk. And so we all took this, and for everyone, there's a spectrum. And we plotted everybody on the spectrum of how much of each of the different traits that you have.

[Ilana Golan]

We use disc, by the way, because it's actually surprised me how accurate it is. And I'm like, why didn't nobody show me that? Because I would have probably chosen very, very different career choices if I knew. I'm very high. D high. I like, I don't like the details. So why did I do product management for so long and try to look at the features? Like, I don't give a damn about the features. Like, I just want to go this way. I want somebody else to take care of the features and the dates and all the crap that goes with it.

[Dan Shapiro]

Amen.

[Ilana Golan]

Why did nobody. Let me understand that we're all motivated by different things. Like, I have a team that love Excel sheets. You put me in front of an Excel sheet. You like Excel sheets. But I was just like, oh, no, no, no, no, no. Too many details. Done. Done. But I think at least know yourself and you know that different people are motivated by different things.

[Dan Shapiro]

Absolutely. And so we looked at this, and everybody plotted themselves on a graph and their Openness, Everybody was pretty open. Extroverted was sort of exactly what you'd expect. We had our sales team on one side and then we had our finance team more on the other, and everybody sort of mapped along. Agreeable people were pretty agreeable. We didn't have too many folks on the neurotic scale who did high. There's one person who was like, I'm really high in the neurotic scale. And three months later, he wasn't there anymore. And the funny one was conscientious. So conscientious in the big five is the attention to detail. And everybody was in the right third and I was way over on the left. And we put this up. And what was funny was my team was like, dan, this is just wrong. I'm like, what do you mean? And they're like, you're on time to your meetings. You're organized, you're super conscious. And I'm like, no, no, no. I have coping strategies and I have ways of managing and I have every single one of you. I've hired a team of very conscientious people because I am not, and I'm not sure the company could take one or two more of me. And so understanding yourself in that way, quantitatively, qualitatively, and helping to connect with people who complement your weaknesses as well as your strengths, I think is such an important part of that leadership.

[Ilana Golan]

And why are we not learning that way earlier in my career at least, I don't know. But, Dan, this was so good. I can probably talk to you for hours. I know I went way over, but this is so good. Thank you for sharing and just incredible to see your journey.

[Dan Shapiro]

Oh, thank you. I feel the same. It is amazing and could easily talk for another hour about this.

[Ilana Golan]

Thank you for being on the show.

[Dan Shapiro]

Thanks for having me. Alana, it's a pleasure.

[Ilana Golan]

I hope you enjoyed this as much as I did. If you did, please share it with friends now. Also, if you're feeling stuck or simply want more from your own career, watch this 30 minute free [e-mail] training. That's leapacademy.com training. See you in the next episode of the Leap Academy with Ilana Golancho.