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Jason Fried challenges your thinking on fundraising, goals, growth, and more

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Dec 17, 2023

Guest

Jason Fried

Jason Fried, co-founder and CEO of 37signals, shares his unconventional approach to business. He emphasizes profit over venture capital, advocating for a bootstrapped path that prioritizes authenticity and sustainable growth. Fried introduces the innovative 'Shape Up' framework for project management, encouraging intuition in decision-making. He discusses the benefits of creative execution, flexible product strategies, and the importance of enjoying work without the stress of conventional pressures. His insights challenge the norms of tech entrepreneurship.

01:49:38

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ANECDOTE

37signals' Success

37signals has been profitable for 24 years, earning double-digit million-dollar profits annually.
They have 100,000+ paying customers and about 75 employees, prioritizing profit and a small, efficient team.

insights

INSIGHT

Venture Capital's Drawbacks

Software businesses often unnecessarily seek venture capital despite low startup costs.
This pursuit of hypergrowth can be detrimental, limiting options for sustainable success.

insights

INSIGHT

Small Teams, Big Impact

37signals prioritizes efficiency and small teams over growth, unlike competitors with larger workforces.
They offer simple pricing, a single codebase, and limit feature teams to two people with six-week deadlines.

Get the Snipd Podcast app to discover more snips from this episode

Rethinking Success in Tech Startups

05:19 • 28min

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Innovative Project Management with ShapeUp

33:19 • 20min

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Navigating Creative Execution and Business Transformation

53:46 • 5min

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Embracing Creativity in Business

59:13 • 12min

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Bootstrapping Business Strategies

01:11:30 • 15min

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Relaunching Campfire: A New Era in Chat Tools

01:26:38 • 11min

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Creative Insights and Recommendations

01:37:21 • 5min

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Redefining Connection Through Driving

01:42:01 • 2min

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Worry Less, Trust Your Gut

01:44:11 • 5min

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#755

• Mentioned in 26 episodes

Hell Yeah or No

What's Worth Doing

Derek Sivers

This book by Derek Sivers is a collection of short, concise chapters offering practical wisdom on decision-making, prioritization, and living a fulfilling life. The central philosophy is that one should only commit to things that elicit a 'hell yeah' response, and say 'no' to everything else. This approach helps in avoiding burnout and ensuring time and energy are dedicated to the most important and exciting activities. The book covers themes such as what’s worth doing, fixing faulty thinking, and making things happen, providing numerous mental models and life lessons to apply in daily life.

#5846

• Mentioned in 5 episodes

Several short sentences about writing

Verlyn Klinkenborg

#209

• Mentioned in 62 episodes

Finite and infinite games

James P. Carse

In this book, James P. Carse distinguishes between finite and infinite games. Finite games are instrumental activities with clear rules, boundaries, and winners, such as sports, politics, and wars. Infinite games, on the other hand, are authentic interactions that aim to continue the play, changing rules and boundaries as needed. Carse explores how these concepts apply to various aspects of life, including culture, religion, sexuality, and self-discovery. He argues that finite games offer wealth, status, and power, while infinite games provide something more subtle and grander, such as true freedom and endless possibility. The book offers insights into how approaching life as either a finite or infinite game affects one's choices, satisfaction, and success.

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• Mentioned in 15 episodes

It Doesn't Have to Be Crazy at Work

David Heinemeier Hansson

Jason Fried

#77

• Mentioned in 120 episodes

Poor Charlie's Almanack

The Essential Wit and Wisdom of Charles T. Munger

Charles T. Munger

Peter D. Kaufman

Originally published in 2005, Poor Charlie's Almanack is a collection of eleven talks delivered by Charles T. Munger between 1986 and 2007. Edited by Peter D. Kaufman, this book draws on Munger's extensive knowledge across various fields to provide a framework for rational and rigorous approaches to life, learning, and decision-making. It is renowned for its sharp wit and rhetorical flair, making it an essential read for investors, entrepreneurs, and anyone seeking to enhance their wisdom and critical thinking skills.

#26926

Home-Made

Contemporary Russian Folk Artifacts

Vladimir Arkhipov

This book showcases over 220 handmade objects from Soviet and post-Soviet Russia, highlighting the ingenuity and resourcefulness of ordinary people in creating functional items from available materials. It includes stories of the makers and the context behind each artifact, offering a glimpse into the daily lives and challenges faced during that era.

Jason Fried is the co-founder and CEO of 37signals, the maker of Basecamp and HEY. 37signals is a very different kind of company. With fewer than 80 employees, they have over 100,000 customers, generate tens of millions of dollars in profit each year, and have no investors, board, or any plans to ever raise money or sell the company. In our conversation, we explore a path many tech founders never consider—bootstrapping. We discuss:

• Why he and his team prioritize profit above all else

• The unexpected challenges with raising venture capital

• The “Shape Up” framework for building products

• Why, and how, to foster a gut-driven culture

• Jason’s thoughts on why work should not feel like war

• Advice for starting a bootstrapped business

• The philosophy behind Once, 37signals’s new line of software products

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Brought to you by Coda—Meet the evolution of docs | Sidebar—Accelerate your career by surrounding yourself with extraordinary peers | Wix Studio—The web creation platform built for agencies

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Find the full transcript at: https://www.lennysnewsletter.com/p/jason-fried-challenges-your-thinking

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Where to find Jason Fried:

• X: https://twitter.com/jasonfried

• LinkedIn: https://www.linkedin.com/in/jason-fried/

• Email: jason@hey.com

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Where to find Lenny:

• Newsletter: https://www.lennysnewsletter.com

• X: https://twitter.com/lennysan

• LinkedIn: https://www.linkedin.com/in/lennyrachitsky/

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In this episode, we cover:

(00:00) Jason’s background

(03:49) The success of 37signals

(06:46) When raising money makes sense

(09:58) The power of small teams

(13:55) Defining success and goals

(17:08) Playing “infinite games” in life

(20:11) Starting a business vs. staying in business

(22:13) Lessons from 25 years in business

(27:28) Venture scale vs. bootstrapping

(30:30) Choosing the right path for your business

(33:19) The “Shape Up” framework

(37:59) The drawback of promises

(39:56) Adopting a new way of working

(41:36) The two-week cooldown

(43:53) Trusting intuition and gut

(46:41) Creating a gut-driven culture

(49:44) What Jason looks for in new hires

(56:19) Advice on making changes and adapting

(01:00:06) What Jason has changed his mind about

(01:02:33) Planning in 6-week stretches and figuring it out as you go

(01:06:43) Being proud of the work you do

(01:09:05) Jason’s thoughts on why work should not feel like war

(01:11:31) Advice for starting a bootstrapped business

(01:14:33) You must be at peace with the worst that can happen

(01:15:42) The benefits of bootstrapping

(01:19:11) The value of constraints in business

(01:22:00) Jason’s philosophy: “Just keep making great s**t”

(01:23:19) Once, 37signals’s new line of software products

(01:26:33) The philosophy behind Once

(01:35:47) Closing thoughts

(01:37:23) Lightning round

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Referenced:

• 37 Signals: https://www.smartsheet.com/

• Basecamp: https://basecamp.com/

• Finite and Infinite Games: https://www.amazon.com/Finite-Infinite-Games-James-Carse/dp/1476731713/

• Ingram Micro: https://www.ingrammicro.com/

• Once: https://once.com/

• Basecamp’s Shape Up framework: https://basecamp.com/shapeup

• Hill charts: https://basecamp.com/features/hill-charts

• Jason Fried’s quote about long-term business planning: https://medium.com/@farkhan569/unless-you-are-a-fortune-teller-long-term-business-planning-is-a-fantasy-jason-fried-quote-a69e8778e9c4

• Brian Chesky’s new playbook: https://www.lennyspodcast.com/brian-cheskys-new-playbook/

• Matt Mullenweg on X: https://twitter.com/photomatt

• Leo Polovets on X: https://twitter.com/lpolovets

• HEY: https://www.hey.com/

• Redefining success, money, and belonging | Paul Millerd (The Pathless Path): https://www.lennyspodcast.com/redefining-success-money-and-belonging-paul-millerd-the-pathless-path/

• It Doesn’t Have to Be Crazy at Work: https://www.amazon.com/Doesnt-Have-Be-Crazy-Work/dp/0062874780

• Squarespace: https://www.squarespace.com/

• Stoic negative visualization: https://dailystoic.com/premortem/

• Linear: https://linear.app/

• Peter Rahal on LinkedIn: https://www.linkedin.com/in/peter-rahal-037bba43/

• RXBAR: https://www.rxbar.com/en_US/home.html

• Jason’s LinkedIn post: https://www.linkedin.com/posts/jason-fried_just-keep-making-great-s**t-keep-your-costs-activity-7130978623523614720-VBGX/?trk=public_profile

• Several Short Sentences About Writing: https://www.amazon.com/Several-Short-Sentences-About-Writing/dp/0307279413

• Hell Yeah or No: What’s Worth Doing: https://www.amazon.com/Hell-Yeah-No-whats-worth/dp/1988575117/

• Home-Made: Contemporary Russian Folk Artifacts: https://www.amazon.com/Home-Made-Contemporary-Russian-Folk-Artifacts/dp/0955006139

• Oppenheimer: https://www.oppenheimermovie.com/

• Tom Petty’s “Crawling Back to You” on Spotify: https://open.spotify.com/track/1JenqZNMU6unIwVWmoP3J0

• Poor Charlie’s Almanack: The Essential Wit and Wisdom of Charles T. Munger: https://press.stripe.com/poor-charlies-almanack

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Production and marketing by https://penname.co/. For inquiries about sponsoring the podcast, email podcast@lennyrachitsky.com.

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Lenny may be an investor in the companies discussed.

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