Bootstrapped vs. VC Funding — Full Breakdown & Transcript

[00:12] language. If you think you may be offended, switch off [Applause] [Music]

[00:25] the Inside Mojo podcast where each week we're looking back at 20 years of Watch Mojo's history on YouTube. I'm your host Rob and with me as always is Watch Mojo CEO and co-founder Ashken Carbisan. Uh

[00:38] how are you doing today Ash? You are back from a trip and yeah no I'm a bit tired but uh super excited and whatnot. So, I was at the WebSummit in Rio in lovely Rio in Brazil and then I hopped over to Buenos Cyrus which I'd always

[00:53] wanted to visit. Incredible cities, you know, very different obviously, but uh no, I mean, especially Buenos, I mean, Rio obviously the beach and all that was great and the u the uh the presentation went went really well and people really

[01:06] liked it. A lot of people, you know, seemed to appreciate it. And then um Buenosirus was easily top five cities I visited. What kind of people were down companies similar to Watch Mojo or was it mixed bag? Like who was who was out

[01:19] down there? To be honest, there are definitely media companies and more and more were like content creators as well. It was a bit funny to walk around and you'd see investors because they would have the investor badge and they would

[01:31] be filming themselves like uh influencers. But no, it's basically, you started years ago, I guess, in Dublin, and then they moved it to Lisbon, you time. And that's the first time I went to uh speak at one of their events. And

[01:47] then also did Toronto. And this one was really just because I always wanted an excuse to um you know, go to Central as South America. And uh no, it was it was it was great, but it's massive. There's like 40,000 people. And um a lot of

[02:02] investors go to see emerging startups. So it's kind of the theme that we're covering today. Um and then yeah, I mean it was it was a lot of I mean I wish I would have stayed a bit longer but um you know have a business to run and when

[02:15] you're travel alone um it's hard you know because you got to stay out of trouble. And I don't mean any specific way but it's like literally any specific way but it's like literally danger um you know taking a wrong turn.

[02:29] Um, even my wife was joking. She's like, "Yeah, just don't come back with like a Verarian." I was like, "No, no, I don't think you'd come back. I think you'd stay there with Exactly." No, no. And it's like, you know, they're everybody's

[02:41] so warm and passionate and you're like, "H such a great place." Um, if you're single and, you know, and ready to mingle. Yeah. I mean, it's it's not a bad place to be type of thing. But, uh, not back. um you know used to do a lot

[02:57] of traveling a lot more in red eyes and stuff so it was fine you know cool fun episode because we're talking about fundraising um so let's kick it off uh

[03:09] episode what do you want to share about fundraising from your perspect again just in the spirit of not just like boring people with like my experience just to make it useful for possible entrepreneurs and storytellers creators

[03:23] entrepreneurs and storytellers creators um you know 2025 the world is a very different place if you are a creator, a storyteller, an entrepreneur, a founder. You have a plethora of options. Um

[03:36] and family of yours who have heard of startups who may have money. They may kind of be you know not interested to invest in real estate or the stock market which is volatile. Um you could also go to the bank and get a loan

[03:50] obviously. Um there are a lot of angel investors who write smallalish checks but you know could be there and open up their network. Uh you have venture capitalists whose sole reset is to take like crazy high-risk bets that could be

[04:07] grand slam you know returns and depending on the size of your your family offices I mean I mean the list goes on and on and on. There's even like like Disney and Warner have their own funds. Um, and so yeah, but you have to

[04:24] be realistic as an entrepreneur of understanding what it means to take outside capital. Okay, so what does it mean? Like what are some of the pros and cons from your your perspective? I mean, we could list the obvious pros and cons,

[04:37] but let me give you an analogy since I love analogies. And this applies to many professions, including just banks. But investors are people ultimately who will

[04:49] give you an umbrella when it's sunny, but when it gets rainy and times get tough are almost like, I want that umbrella back, right? That is just a

[05:01] reality. Investors, and I'm an investor, so if I say something even remotely, I'm entrepreneur to be like slandering anybody. I just want to understand what it means. Um, when you take money from anybody, you have a fiduciary duty to

[05:17] not just return it to them, but to return it to them if in the case of debt return it to them if in the case of debt with interest on a regular basis. And in the case of investment, uh, a multiple back, meaning a venture

[05:31] capitalist, if he lends you a dollar, isn't interested to get back a$120, not even interested to get two or three dollars. They're looking for $10 back or sometimes $100 back. And that's because of what we discussed already, power law.

[05:45] Power law is basically in a portfolio, you know, you're going to have one you know, you're going to have one outsized return grand slam kind of outcome. Most of your bets are going to fizzle and die. So, you really need

[05:58] things to get bigger. So, already as an entrepreneur, it's not that you are special or not. It's not that your project is great or not. The VC is really looking at is this going to be that 100 times return company and most

[06:14] are not right. And I mean realistically even watch mojo wasn't. Watch mojo will go down as like one of the knock onwood best like media investments ever. Um but

[06:26] I concede it will never be a Google or Uber type of return. So even if like a "Okay, that well VC would actually be like, yeah, hats off. Okay, that was good." But it's not necessarily when you go in

[06:42] and take the time to chase money, you really have to like read the rule and understand like if this isn't like a kind of like possible next unicorn like a Google, a Uber, whatever, you may be wasting your time. And then

[06:56] the other thing in terms of what it means to you, you're basically signing a deal where you're being given money, but it's the rope with which you money, but it's the rope with which you will hang your right because if you

[07:10] will hang your right because if you raise too much money, that means you got raise too much money, that means you got to really scale and really make it big. If you raise too little money and you don't hit your numbers and you know

[07:23] everybody is expecting things to go upwards and to the right hockey growth curve stick whatever uh and that's usually what what what is the reality be higher and come up faster. It's like

[07:36] going really fast the costs are in your face. Yeah. But the return and the It's never there and it takes longer. Now yes if you have a good business once you find that tipping point might be rocket ship but it's usually not. So

[07:50] when you are an investor when you're an entrepreneur you really really have to you know like you have the time the patience and all that but it may not be

[08:02] at all what like a venture capitalist wants. It may be what an angel would consider. It might be what your friends and family would love to back but then they don't have the money. But because you're

[08:14] ultimately starting this countdown clock that you have to build quickly enough to justify the deal. Um it may also be like you signed your death uh certificate and

[08:26] uh that is a reality. You know often times even an investor could say hey we don't mind giving you money for it but you're now like chief something or just some other role and we're going to bring in an adult who's kind of got the

[08:39] experience. Um, and that's just like a trade-off and I think that is something that most entrepreneurs just are not realistic about. All right, we got a audience. So, this is up on on Watch Mojo's YouTube channel. We'd like to

[08:52] know who would you rather borrow money from, family or friends, a bank, an investor, or if there's another option, please let us know in the comments and we'll re revisit that towards the end of the episode. So, you've mentioned well

[09:04] not to be anal, but borrow implies only a loan. We're talking in general like borrow money, raise money, like where the source of the capital. Yeah, exactly. Yeah. So, we we'll revisit that towards the end of the episode. Um, so

[09:16] you mentioned a few different sources of potential revenue, um, angels, venture capitalists, um, etc. I I imagine these come in all different shapes and sizes. Is it very different looking for, let's say, a $100,000 investment versus a $10

[09:31] million investment? How do you navigate How do you navigate depending on what your needs are? And as you said, um there's also risk in not not getting enough money versus too much. So like how do you find that balance? That's a

[09:45] great question. So realistically, um you know, an analogy is if you're going to have like a party, you have to be like, "How many pizzas do I need to order?" You know, it's not obvious. And you don't want to have too little food. You

[09:58] rest of like the whole week. Well, nothing wrong with that. Um some may don't know. I am fine with that. I can eat pizza all the time. But but the entrepreneurs who are going to be listening to a show like this on this,

[10:13] you know, theme that may not have the experience to be like, "Oh, we need a million, right?" So I knew that like, well, the $250,000 I started with uh wasn't going to cut it. And so we were we were always like, we got to figure

[10:26] out what you need. So then you got to work backwards. You don't want to be in a situation where you're constantly gonna go back to the markets and raise. Not just that it's a big old distraction and waste of time, but it's because

[10:42] every time you go raise money, your investors are going to look at what did you promise them last time and what did you do? And if that does not jive, they're like, you're not a credible person, right? You're wasting my time.

[10:57] So the first thing you want to do is without overdoing it, you do want to be conservative to understand what is the runway you need to be profitable, right? Basically runway just meaning the time it takes or or whatever. So let's say

[11:13] these are not officially I don't even remember. But if we for example had $500,000 of total costs, well I was like $250 is going to get me 6 months of time. Mhm. So it's going to take six months to meet investors and you know

[11:28] and accounting due diligence and all that. So you basically start to fund raise right away, right? But so that for that reason I was like okay we would probably be smart to raise a million or

[11:43] two because the value of the company is pretty low now. So the more we raise the more you got to give up to the investor and it's you know I talk about greed and and it's you know I talk about greed and you know fear and and all that. So that

[11:57] might go some crazy investor could give you five million when it's just an idea but if you value your business at 5 million you gave them 100%. Right? So, so that's then when the other part of that equation comes, which is once you

[12:12] figure out your your budget, your runway, your needs, the time and then B, takes to close, you do have to come up with some kind of tradeoff where again

[12:25] with some kind of tradeoff where again your greed and fear has to balance on a scale with the investor's greed and fear. Now, the investor's greed and fear, they don't call it that, it's two things. One is like their risk profile

[12:39] and you get a sense like a a VC would be willing to take a total loss. If you borrow money from your uncle or he invests in your business, you probably

[12:51] don't want to lose his money and he also doesn't want to lose his money. It's you understand like so so that's another thing. But then ultimately, this is why sometimes you do hear, especially now with this amplified during the zero

[13:06] interest rate phenomenon that we've covered in previous shows, if all of the sudden you realize that you need, let's say, $50 million, you might end up just agreeing with the investor that you're worth $100

[13:21] million on paper so that the 50 plus the 100 yields 150 and then they get 50 on the post money of 150. So they get 33%. You understand why? Because you

[13:34] were okay as an entrepreneur. You weren't that greedy. You were fine to weren't that greedy. You were fine to give up, let's say, 33%. And the VC also wants you to keep skin in the game. They don't want to be too greedy because they

[13:46] to come and say, "No, no, no. You're only worth 50 million. Let's say, again, it's arbitrary. you don't even have a business yet, but because you need 50 million in data centers, employees, cocaine, hookers, quaudes, whatever,

[14:00] intangibles. Hey, if you're going to be in sales, Lord knows what you got to do. But so, so it is just a song and dance. And as much as like people could say, oh, it's finance and it's just math. No, there's a lot of psychology that goes

[14:15] into it. And again, I got turned down by over a hundred. I did have a handful that did want to invest, but it wasn't the numbers that we were necessarily not on. It was more the strategy, the principle. I would sit across the room

[14:30] and I go, "This is a bit like marriage. It's very easy to say yes cuz hey, there's Sophia Vergera. You know, you agree, fine, but you got to wake up the next day." And then actually that's when the relationship takes off. So those are

[14:44] all things to consider. I I find that the perception is that more of the risk falls on the investor side of the coin, but you did bring up a good point that there are tradeoffs to taking on outside investors. Can you elaborate a little

[14:58] bit on that? Um and and in the situation of Watch Mojo where we did get investment um yeah how did it impact the company? Yeah, so that is first of all question because you're right again if we're talking about your uncle you know

[15:12] George that's risk for him for sure. He doesn't want to lose that money. You going to be really hard. There's that's a personal relationship, too. So, it burnt and then your mom calls. You're like, "What did you do to my brother's

[15:25] we're not talking about that. We're talking about VCs. VCs are professionals. VCs will use and again, I'm I'm an investor as well, so I'm not knocking them. VCs are very good at these mind games, right? It's like

[15:38] investment bankers, like lawyers. When I talk to these people, I'm like mind-b blown. And I'm like, your methods of manipulation and mind control are like, I don't even think in that in these evil ways, so to speak. But it's because

[15:50] they'll be very good at saying like, oh, we have LPs, limited partners, meaning just the investors that gave them the money so then they could go out and give you the money. So they'll be very good at being like, well, we have limited

[16:02] partners and we have a fiduciary duty. Erggo, we got to do this. You know, they will also totally cram down bad terms down your throat. There's such a thing called a cradown round where they're cramming down the the the terms and the

[16:17] mistakes that the entrepreneurs make is they get we collectively we get too obsessed with valuation even though it's a paper valuation. Nobody's coming and giving you that money per se. They're just saying we're valuing like my my

[16:32] milliondoll lily, my beloved dog and your two half a million dollar cats. You understand? like to to set a relative value. Um but the mistake entrepreneurs

[16:44] make is they don't think about liquidation preferences meaning how and who gets the money first when there is eventually money to be made type of eventually money to be made type of thing. Yeah. or drag along, piggyback,

[16:57] uh, vesting. You know, there's a lot of stories where entrepreneurs end up selling their business for hundreds of millions or billions of dollars and people are surprised as to well why do they only have like 1% or half a percent

[17:12] which makes no sense. So the main thing is you should not obsess about valuation. You should really think of terms. There's VCs say this your valuation my terms for a reason. Yeah.

[17:28] And the most important consideration are the liquidation preferences which we'll talk about. But but the the other thing is absolutely a VC is a professional. Even if a VC will do many many questionable things to not lose money

[17:43] because they have a fiduciary duty. They understand and their accredited investors understand that most of these investments may be a total loss. So it's not risky to them in that sense cuz they almost wear it like with honor like oh

[18:00] didn't work out and they will blame everybody else but themselves even if they were a disaster at at the board level but for these reasons for sure

[18:12] it's the entrepreneur that is taking the risk the the the the the time you know like for six years I I don't need to repeat it didn't pay myself mortgage my place and then once we broke even I was like okay now you know it's it's I feel

[18:27] I can breathe a little bit but okay now comes copyright now comes platform you know it's kind of like dance you know there's always a bullet you know they're kind of like trying to avoid a bunch of bullets so to me yeah the risk is like

[18:42] almost if you had to if you had a pie 100% who takes the risk okay maybe 10% is the is the investor because they are ultimately writing a check but it's territory that they may lose it. The entrepreneur is the one that's really

[18:56] really taking the risk. Uh but this is also what as an entrepreneur you have also what as an entrepreneur you have to, you know, be ready to to um to sign up for. Uh and unfortunately, most are not like I I think the era of ZERP, the

[19:10] era of everything we've discussed in previous episodes has kind of created this kind of false idea of what an entrepreneur is and what it takes and how long. And then there you know this this gentleman that I know. So like I

[19:25] invested in let's say 15 startups and of the 15 really one only should be a big hit. One or two may be s so and 10 should lose. I'm seeing about five that

[19:37] are like doing really well. I don't know if they're going to be unicorns but there five that are clearly doing very well. There are five who are lost at sea still trying to figure it out. There's five who are either dead or should be

[19:49] dead. you know, not setting aside the emotion. One of them, um, the entrepreneur was like, well, when I stopped the business, I had to file for bankruptcy because otherwise I did have personal like I basically was also like

[20:04] right? So, I totally emphasize where he's coming from. So, he basically had to file for bankruptcy. That takes a toll on you. You understand? So, so it's like it's it's like not like for the VC. The VCs in that deal, one of them

[20:19] literally was like I mean this is CHA Chatham rules like I'm not going to Chatham rules like I'm not going to mention who but it's educational. The VC that's all we we we are together. We're this we help build like take the credit

[20:31] when like they shouldn't at the end was like yeah I'd rather if we just put a have the paperwork if it's not going to be a big thing. And I was like, "No, no, let me see if I could find them other investors or, you know, pull off a Hail

[20:45] Mary." That's what turned me off a lot because I was like, I know what it takes my favorite when I used to play soccer. I I didn't want to win when we won like 5-1 or something. I like those rare times when we were down and we came

[20:57] back. That was the whole fun. And I saw that when push comes to shove. My god, you're all full of it. Basically. Yeah. Well, they're they're they're giving a little bit a little piece of their pie. and the the entrepreneur that's their

[21:10] their entire life that on the line here. So it's like you hear about the eggs you entrepreneur there's one egg if they break it that's it whereas like a VC will put you know many and I mean we don't need to get into familyh offices

[21:25] and well let's talk about your second question I couldn't give away equity in the early years said this because most people didn't want to invest in content because of money I didn't care about valuation I didn't care about any of

[21:39] the way now people are obsessed with AI content and I'm like AI is a tool. It could do stuff but don't be stupid. It's not just going to, you know, back then people wanted just like content farms or just, you know, the lowest cost possible

[21:52] scaling. And I was like, you morons, you're still telling stories. There needs to be a heart and soul in this. You know, it's now we talk about authenticity, but that passion. I was like, you need this stuff. So, in the

[22:04] money and I'm going to think it's, you know, forget what the terms are going to be in the end. But I was like, the day after the ink dries, they're going to come and they're going to want to cut costs or they're going to want to invest

[22:17] with totally unrealistic return expectations or they're also going to spiral, which I did not believe in. Not because I was like maniacal. I mean, I'm not Lenin here, you know, I'm not Karl Marx, but I was just like, look, uh,

[22:32] even though at the time I was like writing for Techrunch, writing for Media Post, I was seen, I mean, I myself was somewhat insecure, um, the industry saw me as somebody that had a clue of what to do. So, I was like, I rather not take

[22:47] this money cuz it's not it's not like a deal with the devil, but it is like it's effect where I'm going to wake up with a severe hangover. Um, so we didn't do it. But what happened is as I alluded to when COVID hit it did change the options

[23:03] for investors. You know investors really only again forget uncle George forget others investors when they raise capital they generally make money obviously have a salary but that salary is basically management fees of the fund which are

[23:19] usually you could say 2%. But they only really earn that 2% when they actually write a check to invest. Otherwise, imagine you go raise a billion dollars "This is great. I'm meeting entrepreneurs." So, obviously there's

[23:32] there's some checks and balances and then they have carry which is 20% of the profits. That's if there are uh any exits. So, investors by by 2020 we were

[23:45] too big for VCs which usually invest earlier and smaller. I mean some VCs earlier and smaller. I mean some VCs will write huge checks and so I did not need we did not need money for traditional uh sense like of oh we need

[23:59] a bridge till we get profitable or we need to go buy something you know we the world you know what I mean like it's you need a use of proceeds what I really wanted though was even though I was like

[24:12] crazy but I'm also a very like conservative and you know strong administrator and all that um studying finance. So I was like okay we run a finance. So I was like okay we run a tight ship but I go ultimately I have

[24:26] like a hundred depend you know I was in Argentina I was meeting some of our team with an agenda I'm here just to meet you guys and you guys now will see that I'm available to you if you have any ideas to improve I anything just my doors open

[24:39] you know I'm here to help you um and so I was like if if like lightning hits and I was like if if like lightning hits and bye-bye Ashan like just I'm gone I was like it's it's going to affect a lot of people, you know. I was like there's

[24:55] okay payment goes through the your payroll goes through. I'm totally entrepreneurship. If you build a business that you cannot kind of take not an entrepreneur. You're just a slave

[25:08] slave, but you know what I mean. But so I was like, okay, I add something to the knowledge in this field but but the problem was I felt it wasn't like it was

[25:20] op not operationally administratively it was a bit too much of a one-man show so how do you get somebody to care if you're a single parent about your child well you need a co-parent what you want yes you want

[25:35] love and affection but you want somebody to ultimately come and adopt almost your child right right that you share that obviously experience and joy but you're like okay it's just it's even subconsciously that that's you you need

[25:49] that so I felt that with COVID when like half the world got decimated like Thanos snapped his finger and travel got hit and all these industries got killed I Trump from shutting down YouTube what's stopping copyright we we're legit

[26:05] there's no real risk knock on wood but you never know platform risk um whatever but also keyman risk. You know, I understand we built a team. I'm nothing come up with ideas. I don't know how to edit. You know, there's certain things

[26:20] you realize, but administratively it was a too much risk around one person. So, I was like, if I go get an investor and they come and they share the risk, yes, financially it was good, but I didn't need you know the watch mojo by then was

[26:33] very successful and because nobody wanted to share the risk with me on reasonable terms. Yes. for in finance parliament ris I took the risk let's say you know like the the the executive team we all kind of benefited but it was

[26:48] mainly for me just security insurance which almost sounds a bit weird but as an entrepreneur you actually you're paranoid you know like Anthony Grove co-founder of Intel popularized that line only the paranoid survive so yeah

[27:02] like the 2010s I basically every day I had one worry or another you know I was like something is going to f us today what is that slot time slot machine. But so when I brought them on um I didn't actually do a process like I didn't

[27:16] we did hire an investment bank because you want expertise. I didn't necessarily everybody. I was like Paramount ain't investing in anything now. Disney is trying to figure out theme parks with masks. So it was like I was like just

[27:32] make sure given my style of being too polite. Yes, there's crazy Ash, but my courteous. And I was like, that's not the right way to negotiate with and be like, we need all these terms because we have a duty to and I was

[27:45] back a bit. You have your lawyers, but the bankers again, powers of manipulation and, you know, persuasion that somebody could speak on your behalf, you know. So, we just spent 6 months uh virtually during COVID. They

[27:59] They ultimately invested in us never meeting me in person. So they called people and that's what I I got a more of a high on that than like how many subscribers we have. The idea was and again I just want to preface it now it's

[28:14] still meant to be general. So we locked out in terms of like character integrity alignment of values in terms of like ethics and and whatnot. It's a New York based firm called Star Mountain Capital formerly known as Haliard. Um, so

[28:29] there's a couple gentlemen and they had worked actually for like the um there's to that probably they may even not care about but like I remember like they had worked for uh as investment bankers for like some Canadian banks. So I was like

[28:42] the US I was like okay they know that culture a little bit. They know how we are as Canadians. Uh the founder of Halliard merged with Star Mountain. Star Mountain, its founder was a Canadian, uh, you know, who was an athlete and,

[28:58] you know, really seemed like a good guy. Um, smart guy, also very entrepreneurial. So, that I liked. Nothing against some guy who leads a fund like that, but who's more of like corporate. There's nothing wrong with

[29:11] to that, but I did like that. So, there's a lot of like nuances and and whatnot that I like. I also like that it wasn't like bad faith negotiations. if for me, if I explained it, they would come back with like a a creative

[29:26] solution to implement it on a piece of paper. Um, one thing in particular, I know me. They don't know why this matters to me." But I was like, "No, these are reasonable people." And in turn, I think when they were want stuff,

[29:39] like sometimes just I'm like, "Teach me. I'm I'm I'm a sponge. Why is this Because I was like, "I may have to explain it." or in two years if it comes back to bite me I don't want to so fantastic on that front but I'm just

[29:54] being very transparent the media world changed right I mean what happened was um interest rates shot up we had our first down year and in that they were very professional and they weren't like yelling or you know anything like that

[30:07] they but also because I'm not a dishonest person I think it's it's like also a lot of it was external right yeah but as we started to work together. So, another reason I wanted to do a deal was because I wanted before ever selling

[30:23] finally to like Paramount or whomever Paramount like MTV cuz like MTV was one of the many companies over the years I was like very impressive you know I wanted to avoid a scenario where I just sold to like a Bell Media in Canada or a

[30:36] Viacom in the US or like a Balisman in in Germany wherever and then we just this like we kind of bring down the watch wardrobe flag a bit. We put up their flag at equals, but ultimately you're fighting under another flag.

[30:52] And I don't mind personally no ego with that. In fact, that's like the main man. That's like when you get in this racket for that. But I was like, if we never try to go really big, which usually you do need funding because you want to be

[31:06] able to take bigger risks, aim for the fence. I was like, yeah, at the age I'm at, like early 40s, I was like, I will probably regret that. People say they regret it now you move on you you manage but so I was like I wouldn't mind doing

[31:21] that before you know with the passage of time while I'm happy on 89% of you know 97% of the reasons yeah it's true that money alone is never the solution and I used to say this I'm like when you actually have money you throw money at

[31:36] problems thinking that's a quick solve and it's not you just end up burning the money and you're like it needed time it needed TLC needed TLC So as we um do I want to go to okay I'll

[31:49] So as we um do I want to go to okay I'll mention this. So what I then in why not let's I'm curious. You can't stop now. So I if you would have told me like in So I if you would have told me like in October or November if you were like um

[32:03] hey do you think that like watch module will do another transaction and be acquired? Yeah, I would have been like not really because you have the uncertainty of possibly a change in administration in the US. There's talk

[32:17] of tariffs. There's booms and you know crashes and ups and downs. Um I was like all the likely media companies are trying to fix their business. You know, Disney overindulged by going to Disney Plus and output. Warner is merged with

[32:33] Plus and output. Warner is merged with Discovery like Watch Mojo's inform and actually resonates with like Warner entertain and discovery learn for example. But I was like they're cost cutting mode. They're their house is a

[32:46] an extension right now, right? So when I kind of looked at the landscape, I was like you know forget about it. But what ended up happening is a lot of companies realized what we saw 20 years ago that YouTube is the future. It's in fact it's

[33:01] them had underinvested no real exposure underinvested no real exposure but most of their options to become present and significant on YouTube were non-existent. you could not necessarily

[33:19] um you know go and buy a PewDiePie channel. Mhm. You know, and you cannot go buy WWE'se's channel or or you know, Taylor Swift's channel, right? So Taylor Swift's channel, right? So because Watch Mojo was one of the few

[33:34] investable or acquirable assets as a company and a brand, we started to see like, okay, even if there's going to be all this uncertainty in the market, at least in our little universe, there does seem to be. So we are now kind of like

[33:49] on the fence of saying hey there's all this interest again because not just being at websummit people were you know telling me how much they love the brand and know the brand and all that but you always have to put things in the macro.

[34:02] So yeah to my own surprise it's possible that in order to give that return to the investor which you don't control it's the market it's timing we may do something like that and join a bigger company but we shall see. Interesting.

[34:15] We got a really great question from the audience. Uh, somebody would like to know what advantages did bootstrapped founders have that VCbacked founders often overlook. I I I'm not saying this to be rude to any VC uh backed

[34:27] there some of the greatest ones are VCbacked, but you are really not in control anymore. Like you don't even if you sell 5% doesn't matter. You might have sold 90% may as well have because it's the terms. So you have like a lot

[34:43] of veto rights that you have to agree to. You sometimes will not be able to to. You sometimes will not be able to sell um just because you feel like it. you as the lead entrepreneur lead person is like I'm selling the the investors

[34:57] may have to accept it but there's many stories where the VCs will veto a deal and you realize hey man even if they only have 12.2% on the cap or capitalization table they're controlling it because they have certain veto rights

[35:10] right. So I think that is really the biggest one that you you you effectively lose control now it's a bit crude to be like I mean even I when I was younger and even though I used this last month I think then you're a venturreneur because

[35:23] think then you're a venturreneur because you really are not like old OG style gunslinger and then the other one and then we can move to the poll which was more important for me was all about principles like I'm not saying investors

[35:35] are unethical they're some of the most legit you know stellar highquality individ individuals could be very much investors. But I do think that an investor will always prioritize profit because they have a fiduciary duty to

[35:48] their LP. The real OG entrepreneur will focus on principles and their purpose, which was my closing at the Rio, which we'll talk about when I left. It was like entrepreneurship. I like the intangibles of this racket. So I kind of

[36:02] was like look you know what I said was I mean maybe we could play it but but the gist was if you focus on your principles and find your purpose you will and find your purpose you will eventually if you're good and lucky and

[36:15] all that you will earn the profit you are chasing but basically I was implying there's way too many entrepreneurs that's become entrepreneurs because of that's become entrepreneurs because of profit just money no real purpose no

[36:27] profit just money no real purpose no principles or not consistent I go then because somebody else will beat you at what you're trying to do. Yeah. A bit of because it's true, right? Yeah. No, it's a super cliche, but the reason why I

[36:41] could say it so openly is because I want entrepreneurs to know like, okay, why do we do this? We do this hoping that it helps creators, storytellers, entrepreneurs. But this is not the sexy narrative. remember like I don't even

[36:54] know like in in 2006 when we started there was a startup that was like I you probably know big like there was there was Reddit and Dig Dig was the the one that got more so Dig did a investment

[37:09] round that valued the business at 60 million and Business Week put a picture kid you know typical that era like you look flannel shirt I think we had that categorized under the section of last week's episode not Kevin Rose.

[37:23] but it was more the media. Yeah, the media was like, "Oh, how does Whisk Kid build a $60 million business?" It was not really a $60 million business. And incidentally, Reddit only sold for 10 million. That came out of Y Combinator

[37:38] only sold quotation mark for 10 million. And its founder, um, there he is. Yeah, there you go. Yeah, it's And um, I actually invested in the Reddit um, I actually invested in the Reddit founders fund. Um, but he he I mean he's

[37:53] saying anything. He regrets selling in a way at the time he did to cond because Reddit is now publicly traded and worth a ton of money. Um, and as an entrepreneur like that's the weird thing like sometimes you live with the regret

[38:08] of a failure when it something doesn't turn out, but some entrepreneurs have more regret when they almost sell and leave money on the table. That's why it's like there's a lot more that goes into it. The legacy plays into it a lot.

[38:21] Legacy is a huge thing. Yeah, legacy is definitely. those. They're in. We asked who would you rather borrow or raise money from? And 40% said family or friends. That's the number one answer. Bank 31%,

[38:36] investors 21%, and other 6%. I don't know what those others are, but uh the mob. Yeah, that's why I was really in South. I'm kidding. That's a bad stereotype. Um yeah, I mean that's really really interesting because family

[38:50] and friends there's in my humble opinion way too much baggage. way too much baggage. Um bank that means loan. So okay, you keep control so long as you pay the bills. Investor. Okay. I thought that

[39:03] would be higher and yeah I'm really curious by the 6% but that's fine. Yeah. questions are asked by family and friends. I guess that's true. Yeah. Good point. Yeah. I mean also the other sorry the other is if you're like a creator

[39:19] you have like things like Kickstarter you have crowdsourcing you also have like firh companies like spotter like sp o ttr uh they come and they give you an

[39:32] advance on like royalties of your back catalog but that means you have to be Mr. Beast and you're gener well Mr. is the extreme. But these are not our numbers. Let's say if a if a if a Joe the creator or even a watch mojo let's

[39:46] say you make a million bucks a year on average every year like your back catalog they could come and be like okay we'll give you whatever like half of that one love sum and then we'll recoup

[40:00] they're giving you but you get that money today to go do a documentary you know or in our case we actually did a Kickstarter for for a game for a game terrible influence yeah so that's Uh, and we hit like 136% of the target we

[40:15] wanted. And reality was we were always keeping that like an ace in in the back of our pocket. We thought of like, you know, we've done two documentaries, uh, Fox in the Hen House, how uh, geek culture overtook pop culture, those we

[40:27] didn't really need u Kickstarter. And then, as much as I would like to consider something like that for like a scripted project or like a real vag kind of thing, it it has to be like related but different enough to what we do. You

[40:41] understand? And then there's the optics that us as a creator. Oh, there you go. Us as a company, I never wanted it to seem like a handout. I know uh the folks seem like a handout. I know uh the folks at Vox um when the Zerp era ended, you

[40:55] know, I don't blame them, but a lot of their viewers raised their eyebrows when Vox, this, you know, big company that had all this venture backing was like, had all this venture backing was like, "Hey, do you want to fund our um our

[41:09] programming?" And even I was like okay it's bold and you know like I would have liked to be in the room to like the positioning you know the messaging um because intentions are never you know what what are not perceived the way you

[41:22] intended them. What about for small creators? Because because we live on YouTube as Watch Mojo, but you know, a lot of individuals have have their their channels and their brands. Um, and as we mentioned, uh, crowdfunding is something

[41:36] that's available to them, but is looking for venture capital a wise option for somebody like that who has a smaller business? That's a good question. And so ago, I would have laughed. I would have and that's one reason why Watch Mojo was

[41:50] wanted each topic to be the star. I didn't necessarily want it to be Ash Moldro and know there was many reasons. Um today you actually have like Sam Lesson I think it's him Sam Lesson was an early Facebook employee um and so he

[42:07] launched Slow Ventures for example and Slow Ventures actually is geared towards Slow Ventures actually is geared towards the creator economy. So yes, you know what? If you fit certain things, again, I'm sure he cares about the vertical

[42:21] you're in. You know, is it brand safe? Is it are you a credible person or do you have a checkered pass? You know, I'm sure it's still there certain criterias that are taken from like traditional venture investing, but it is geared

[42:36] towards what you're describing, you know, the creator economy. I don't know if ultimately creators are and I'm an investor so I'm saying this like if somebody came to me I don't know

[42:50] somebody came to me I don't know if the creators are really an investable if the creators are really an investable uh like category it is and I used to be lifestyle business as a knock and I was like maybe it's a boutique business but

[43:03] I don't think it's a but but I think creators are the ultimate lifestyle business and for two reasons successful ones can earn great income and they could have great lives but yeah it is like a burnout risk the shelf life

[43:19] it is like a burnout risk the shelf life you know eventually there was a gal um started doing like vlogs when I was like 18 unemployed in Hollywood I was lost in life I don't want to be doing that same shtick yeah you know well you hear it

[43:35] time and time again with the whole burnout phenomenon But also the shelf life of what you cover. You know, if you were like, "Oh, silly reactions about stuff." Okay, after doing 300 of those videos, you may be tired. So yeah, I

[43:48] think you do have as a creator more options, but I really think you have to do it in a way where you have to commit to it enough, but you definitely want to before going out there and committing five years of your life to now be a

[44:03] slave for like some venture capitalist who's like doesn't really care, doesn't have any passion for you, the topics you cover, um, and before long is going to disagree with, you know, what to do. I I don't necessarily think that is the way

[44:17] like starting it off as a side hustle, tickering, in iterating, adding cadence, frequency, velocity, and then there will come a point where then yeah, you could maybe get a little bank loan or even just secure credit line. You could find

[44:33] a brand deal, you know, you could maybe find not just advertisers, there are know what, you're pretty good at what you do. Why don't we do a deal where we get like exclusive distribution, you know, or we just license some of this?

[44:49] creators should really think like and that's outcome, but there are no unicorns really in media the way that they are in out and I don't want to just be like, oh yeah, there are these funds, go do it.

[45:04] Investors, if they don't see the return, they will move on and that's bad. If you have an investor on your cap table that is no longer committed not just to the company but to the category, you see it. They're just, you know, gone, you know,

[45:17] that's another thing to consider. So, now that Watch Mojo has a board of content in any way or is that a nonissue? To be fair, we had to make some changes uh like early on with brand safety because like you guys were I love

[45:32] came up with crazier ideas, but like you guys would just be it would be like the horror blood and gore. I was like, this is not brand safe, but okay. Um so we proactive. Again, if you're not part of the solution, you are a problem.

[45:47] Copyright, you know, again, even if everything is fair use, we're not times when we're like, okay. So, we took a lot of those things and that's what I meant by further professionalizing. Um, but and this is

[45:59] not bad. What I swear I mean they're not definitely sitting here. The board does not like sit on the live stream. But I myself brought them on because like I anybody off, right? But when like times got a bit harder and things weren't just

[46:13] automatically going up, they were they did their job. They were like, "Have you thought of laying off the staff?" And I was like I had to show them that I was open and I wasn't just rigid even though most entrepreneurs may be like yeah

[46:25] let's good opportunity you know never lose a never let a crisis go to waste. I was like I go I don't think we have fat. Are there steps are there certain people that maybe we don't need or if we had to you know after 20 years you have certain

[46:40] added steps and added redundancies or redundancies. Yeah. Almost built for redundancies. Yeah. Almost built for quality. Yeah. So I said I think that them more like rationally not emotionally but I said I think that like

[46:52] before we know it there will be a recovery and as I turned out to be right again luck but I was like I think YouTube will disproportionately benefit so I said we don't want to cut fat muscle bone and I

[47:07] was like I think what we should do is just trust us because you're a minority not in the trenches you're not going to care about this but just let us kind of review everything and if somebody leaves whereas in the past we would quickly

[47:21] want to come and be like all right Joe Dtoer you guys got to take all these tasks let us kind of like do a self assessment and so we did it that way but that was an example of me needing them to at least bring something up that my

[47:35] culture of to you know my nature would never think I would never even when I was in Buenosirus like right before uh I left one of our colleagues was like oh There's a couple more. They're not on the, you know, they don't seem to be

[47:50] like, extend the table. Bring them on. You know, so, but that's a very different conversation. I needed somebody in the room that could say with that I've worked with for six years or Tommy whose kids I just saw at the

[48:04] company out in, you know, it's that's I that to me is that's where I go. I'm not your normal entrepreneur. But but they were asking those tough questions and we we did the right things. But again, I wanted that. But now I see

[48:20] and biggest version of itself. It's not money. It's like a big brother, a big sister, like a bigger company or a company of our size that's

[48:32] strengths." Because it's true, there's no barriers to entry, you know? That's kind of could have seen coming, but I wanted to get it out of my system. Yeah. Cool. kind of an interesting point to wrap things up on. Uh let's talk about

[48:46] covering trends and themes in media, successful media franchises. Yeah, I we'll talk about the the trends, but I think I want to kind of break down like yeah, if like not to revisit like Joe Rogan, but things like the acquired

[49:01] podcast, Joe Rogan, there's a lot of you know, if you really really look at okay, what have been the new media brands built? There's an interesting through line. there are some very specific commonalities. Um, and mainly none of

[49:16] them seem to emanate from corporate America, you know. So, that's what I think we'll talk about. And the purpose is not just for us to say why Joe Rogan is great or P or whatever. It's more to help somebody, a young entrepreneurial

[49:30] creative storyteller listen and go, "Oh, if I match these these patterns and trends to that one thing that I have a comparative advantage in, that I'm for three, four years, I could be the next big thing, basically." Cool. It

[49:46] forward to that. All right. Uh, gracias, Ash, as always. Uh hope you have a great week and uh we'll see all of you guys next week for what is it episode 16. We're we're getting closer to Yeah. And I mean if if

[50:00] in the next four as we wrap this up when we we should start to think of and I don't need to be involved but just are there other podcasts in the worlds that we could you know look out for if the audience has any question. It's just

[50:14] funny as we leave. So when I left the stage, as I said, I was it was very like turned it a bit more into like motivational like I could coach and then when I got off the stage the stage manager was like excellent. You killed

[50:29] it there and I was like and I said what I did here. So the outro just to put into context that's finish off with that. I'll see you guys next week and we'll end with Ash's speech. That's it. Thank you. God