#319 The New Age of Entrepreneurship: No-Code, Innovation, and Shared Success With Colin Hirdman

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Mehmet: Hello and welcome back to a new episode of the CTO show with Mehmet. Today I'm very pleased joining me Colin. Colin, thank you very much for being with me on the show today. The way I love to do it is I keep it to my guests to introduce themselves because I believe it's the [00:01:00] best way to do this. So tell us a little bit about yourself and what you are up to currently.

Colin: Sure. Well, thank you. I really appreciate having you have me on the show and I'm really excited to be here. Uh, and, and really share my, my journey and my entrepreneurial history with you and your audience. So I've grown up in the United States, uh, in Minnesota, uh, the twin cities of Minneapolis and St.

Colin: Paul. And, um, I Um, really kind of fell into, um, entrepreneurship a week after I graduated from college. And it's really been an entrepreneurial journey. Um, ever since then, I, um, really have a fondness for, for entrepreneurship. And, uh, yeah, I'm really looking forward to, to sharing that, uh, with, with, with your audience.

Colin: And we can kind of go through that history, however you'd like. Uh, but yeah, really excited to be here. 

Mehmet: My absolute pleasure, Colin. The thing that I'm [00:02:00] always, you know, on the personal side, like even if I do this outside of the podcast. I like to ask people what attracted them to whatever they are in today.

Mehmet: And entrepreneurship, and I know like maybe it's a cliche now, it's not the easy thing that someone might choose because, you know, you might have the option after graduating from college, even if you are a dropout also, you might say, okay, you know what? I'm going to go and find a job in a company.

Mehmet: corporate or maybe it's a family business, but choosing to be an entrepreneur, it's, and I know that from my personal experience, it's not the easiest path to do it. So and you did it at a very young age. So tell me a little bit more about Your choice Colin and how rewarding was this experience for you?

Colin: Yeah, well I can say there's probably um somewhat of a recurring theme in that I didn't know what I wanted to do. I [00:03:00] graduated with a criminal justice degree, um, because that allowed me to graduate in four years, but I was looking at, you know, other disciplines as well and ended up going with that. And a week after I graduated from college, I started my first company with no classes in business, no marketing classes, no finance classes, and, um, really just learned it all.

Colin: trial by fire. And, uh, I think, you know, that experience, uh, in building something from nothing, um, although it's incredibly challenging, it's also very, very rewarding. Uh, and, uh, I just really fell in love with, with the creative aspect. You know, when you think of creativity, so often we think of, you know, musicians and artists and things like that.

Colin: But in reality, Entrepreneurs are harnessing creativity at its core and are leveraging that to build businesses and [00:04:00] products of value. And that's really what has propelled the human race forward are creative thinkers and using entrepreneurship as a conduit for that. The other thing I think just as it relates to the stressful components of being a You know, one of the things that's always kept me grounded is just the finiteness of our lives.

Colin: You know, right now, um, you know, we're, if you live to the ripe old age of, you know, 90 or 100, uh, you're pretty lucky. And I've always thought, you know, when I'm 90 or 100, And I'm looking back on my life. I want to be able to say that I lived a life rich of experiences. And a lot of that means taking risks.

Colin: And a lot of that also means failure. But that was always something to me that was in, made some of those really hard decisions a lot easier. Just knowing what does my 90 year old self want to look back on my life. [00:05:00] And, uh, I would be a lot more. I think appreciative and satisfied with my life. If I knew that I took risks, and even if most of them failed, if some of the successes really propelled me forward, that would be a life worth living.

Mehmet: That's very inspiring, Colin. Now you mentioned something which actually I, You know, the question came to my mind immediately about, you know, when you were at college and this is, we hear it a lot. And, you know, also I've discussed it with a couple of guests here on the show. So there are some courses which might be very good for someone to be prepared to be an entrepreneur, but you know, we usually, including myself, we didn't take these courses.

Mehmet: Now, but you know, entrepreneurship, especially in the past, I would say maybe four or five years 30, 40 years to be fair. And you know, now with the ability of us being able to watch the previous entrepreneurs, [00:06:00] don't you think that still we are missing these components in education today? Like, don't you think that, you know, we are not teaching our kids like basic finance, basic marketing.

Mehmet: I don't know, like, uh, these things that, you know, would help. In the future for someone to be prepared to be entrepreneur because, you know, I could have asked you like the question, like Colin, what could have you changed in the past today? But, you know, when you mentioned about the education, this came to my mind, right?

Mehmet: So do you agree with me on that? And What should we do for the new generation so they can be prepared to be better entrepreneurs, I would say. 

Colin: Yeah, no, I wholeheartedly agree that, at least here in the United States, you know, I think part of the culture in the United States certainly does have somewhat of an entrepreneurial slant.

Colin: Uh, but, That is generally, [00:07:00] you know, not something that is taught in grade school. Um, and so I think getting younger. Uh, kids and younger adults, understanding the opportunity available to them through entrepreneurship is vitally important. What that requires though, is that, uh, the, the school systems begin to adopt and create space for those entrepreneurial narratives, which I'm just not sure they.

Colin: You know, have the, the will to, to bring in. So what that would require, I think, would be some of us in the entrepreneurial community offering our time to go to these schools and start to talk to classes. Uh, so that's one of the things that I've done. I've gone back to my, my college and I've talked to some of the entrepreneurial and marketing classes there about my own experience.

Colin: So I think it, you know, some of the. [00:08:00] The weight of getting these younger generations to see the opportunity on entrepreneurship falls on the current entrepreneurs to take time and share what they what they know. 

Mehmet: Absolutely. And you know, one of the reasons and they tell people this why I'm doing this podcast because when I was younger I would not say I didn't have the resources, but, you know, I didn't have someone to guide me to go and look for these resources.

Mehmet: Right. So, um, I, I tried to change this, you know, giving back, uh, through this bringing, uh, valuable guests like yourself Colin to talk also about that experience, hopefully to inspire people to, and, you know, to tell them and guide them how they should. Do this properly. Now, one thing, and we were discussing this before, you know, we started recording today.

Mehmet: I want to a little bit focus on the rise of the non technical entrepreneur. Now, uh, [00:09:00] till a couple of years back, you know, A lot of people, they say, Hey, I have idea. I know that this might work. I did some due diligence. I did some research, but I'm not a technical guy, so I'm not going to do it. And they get stuck.

Mehmet: So can you, from your perspective, Tell me more about this shift now in entrepreneurship and the ability for non technical people to become entrepreneurs. Um, so how is this shift happening and why do you think it's a game changer for, you know, aspiring entrepreneurs today? 

Colin: Yeah, no, that's a great question.

Colin: So I'll probably just start with talking a little bit. More in depth than on my entrepreneurial journey. So that first company that I started, um, was in the, um, mid nineties starting, you know, we were doing direct mail and data processing, and then by 99, we started to do email marketing and web design and [00:10:00] custom development and whatnot.

Colin: I ended up selling that company in 2006, and then in 2007, I started Monkey Island Ventures with Josh and Zach, who are two of my childhood best friends. We've all known each other since we were about five years old, and Monkey Island is the name of a park we used to play at when we were kids. And, uh, What we wanted to do was to start building, um, SAS products.

Colin: And the first product that we looked at building was a marketplace, which was kind of a combination of people. and nonprofits all being able to create profiles and connect with one another, share services, share products, share events, um, and whatnot. And, um, so we, we raised money and we, uh, hired developers to help us.

Colin: So Josh, Zach, and I, none of us are technical, uh, none of us write code. We're certainly technical enough to, um, get things done, but we [00:11:00] don't actually write code. So, uh, we, you know, at first we used an off the shelf piece of software that didn't quite cut it. Then we used, tried using a little bit of offshore and onshore and, um, you know, had good and bad experiences there, but got the product up and running and ultimately it didn't, it didn't take off, but learned some really valuable lessons there.

Colin: Um, that kind of parlayed into us building a couple of other products built on top of Twitter at the time. So this would have been around, you know, probably 2012. 10 through 2012. Um, one of the products we built. Um, we again hired a developer. We took, you know, a little over a month to build the product.

Colin: And, um, Within two days of launching the product, we signed up about 30, 000 users off of Twitter. We were a trending topic on Twitter, and the product was really to help Twitter users find each other, according to, this was in the United States, their zip code, and then their city and their [00:12:00] state. And we kind of got this viral loop going.

Colin: It was really great. We didn't have a monetization model, so we didn't make any money on that, unfortunately. And that parlayed into a product called, um, SMB tweet, which was a, uh, product that would create a Twitter following for like local retail, like coffee shops, um, you know, uh, restaurants, things like that.

Colin: And that product really started to take off. Uh, we had a monetization model. We were charging 19 and 95 cents a month, and this algorithm would run and, uh, went really, really well. Unfortunately we had to. Um, kill the product because Twitter was changing their terms of use and didn't want any kind of automation.

Colin: So we learned a hard and valuable lessons about building on top of, um, you know, some of these big platforms where you can achieve scale, but you're also beholden to them. And, um, they really do control your business model. Um, so through some of that, we, we launched some other, um, you know, tech enabled businesses and software, um, companies.

Colin: Um, [00:13:00] You know, we even did a, created a smart water meter and was, um, we got it funded through Kickstarter and, um, ended up going to Dubai for an energy conference. So we got actually flown there by Dubai, uh, to participate in this conference because of our smart water meter. Um, so, but all those things being said, um, We were non technical, so we were always hiring, uh, technical talent to, to help us, um, build these, build these products.

Colin: Um, during the last. You know, seven, eight years, um, we also, uh, created a digital marketing company, um, and a software development company from a services based perspective, um, and our, our software development company, um, called cloud burst, one of the things that, um, You know, we've really started to lean in on over the last few years, [00:14:00] um, is, um, the use of no code, low code tools, as well as leveraging international, um, development teams.

Colin: And so what, you know, we built Cloudburst to be the software development company we always wished we had as non technical entrepreneurs. And so what we're finding is that, you know, if you look at low code, no code tools, They are exploding in use. Uh, it's allowing non technical founders to, and entrepreneurs to, uh, begin developing products, uh, for themselves, whether they have an existing business or not, you know, what we find a lot of existing entrepreneurs that have successful businesses, building a software product to help you scale that business is a wonderful way to grow.

Colin: So you don't have to, um, completely be, uh, technical in order to leverage some of these tools. And then with international talent, [00:15:00] uh, you know, you're able to leverage lower cost in getting that development done. Uh, and you're able to start to really kind of follow those lean methodologies around creating a lightweight product.

Colin: Version of your product. And then, of course, a I coming into play that's helping developers, you know, correct code, create code more efficiently. Um, and as we see a I more ingratiated into, um, low code, no code products and, you know, new a I products to help you build your own products that's going to continue to explode in use as well.

Colin: So you have, you know, This kind of rise of the non technical entrepreneur, which are all of these people where there was technical barriers holding them back. Um, that's becoming less and less of a barrier now, and it's allowing more people, as I talked about at the beginning of, um, you know, our talk here, which is really tapping into their own creativity, their understanding of where pain exists, and wanting to build [00:16:00] product to help, um, you know, people.

Colin: You know, solve that pain and be able to do that, um, without having to be a technical entrepreneur. So really it's just kind of, um, just combination of factors that are happening now, that's really, I think, going to create a thriving entrepreneurial, uh, community of non technical entrepreneurs, building tech enabled businesses.

Mehmet: That's great, Colin. And I'm a big fan of no code tools. Like, of course, I come from technical background, but not coding. I was not into the coding. Okay, I can understand codes, but I cannot write like the application. And you know, when, when the first time I've seen the first no code tool, a couple of years back, um, you know, I said, actually, even I remember during my studies, you know, they used to teach us the basic, you know, programming languages and, you know, you know, trying to do something visual.

Mehmet: And I always was thinking this should [00:17:00] be much easier. Like even for someone who's, you know, I'm a computer engineer, uh, graduate, even I was saying there should, must be a simpler way to do this. It doesn't have to be that complex. And, you know, I was always looking for things that can generate code. And then I started to see the no code tools.

Mehmet: And then I said, Oh, wow. Like this is exactly what I was thinking about when 20 years back when I was, I was still studying. So to your point, it's absolutely, you know, something that is enabling people to, to get their ideas out to life. Now, of course, but there are the naysayers all the time. So, you know, the people that say, you know, they try to put the stick in the wheels, as we say now.

Mehmet: And one of the things that they say, Hey, but you know, you cannot Uh, go beyond an MVP. You cannot scale, you know, using no code tools and so on from your experience, what you can tell us, Colin, about this point specifically, because, you know, the aim here today is to encourage people to go forward and not to listen.[00:18:00] 

Mehmet: But of course, from someone who has experience, it would have like more authority, I would say. So tell me a little bit more about what you say about these opinions about the scaling and, you know, the. Limitations that no code local tools have. 

Colin: Yeah, there definitely is, um, you know, scaling and limitations with low code, no code.

Colin: Uh, so you may be able to get a product 70 80 percent of the way there with low code, no code. Uh, you may need to hire. Talent in order to help you kind of close that loop on how your product, um, operates, uh, in order to give the experience that you want to give to your prospects and your customers. With that being said, you know, One of the things we talk about is it's, it's never been easier to, to build software.

Colin: It's also never been easier to overbuild a product. And so I think that's one of the things, especially at Cloudburst, [00:19:00] one of the things that we kind of act as is kind of this guide or this mentor, um, layer, because a lot of our clients, they, because they are non technical and they don't really understand software, they don't know how to hold the technical talent.

Colin: Um, uh, you know, within, um, you know, a layer of, um, Being able to tell them, you know, what, what, how things should be done or not. Right. So, uh, they're missing that component. They can't write the code. They can't tell the developer if their code's any good. They can't tell the developer how long things should take.

Colin: Um, so they're kind of stuck in this, um, Difficult spot of having to, uh, manage technical talent when they don't really understand the technical aspects of what it takes, takes to build. So the, my suggestion is that [00:20:00] you have a very narrow focus on what it is that you want to accomplish with what you're trying to build.

Colin: Um, Look at low code, no code solutions as a way to potentially cobble something together. Uh, you may need to hire some development talent to, to help you, like I said, finalize the product for release. But at the same time, as we know, uh, so often what, if you're really addressing a real pain point, Then you need to realize that you don't have to have a beautiful product.

Colin: You don't have to have a product that is, you know, perfected. What you need to have is a product that is addressing that pain that, that, uh, user's feeling enough to where they want to use your product. And, uh, you know, I recall, you know, Zapier was listening to the, was at a conference last year. And was listening to him talking about the CEO, talking about, [00:21:00] um, the launch of Zapier in the very, very early days.

Colin: And he had a, uh, a brand new user, one of their first users ever that created like this long zap. And he was walking through trying to figure out with the. Customer why it wasn't working and he finally got to the end and they fixed it and in his mind he was thinking wow, this Zapier product is Horrible, like I don't know why people are even using it He felt really embarrassed, but his customer said at the end of that Wow, this is fantastic.

Colin: Like, I can't believe that we're going to be able to automate this. You're helping me so much. You're reducing this pain for me. It's going to save me, you know, at least a couple hours a week. So, I think, as entrepreneurs, we need to understand keeping our vision very, very focused. And, uh, very thin around what is that pain that we're trying to solve and really attacking that strongly, getting it out [00:22:00] into the hands of users when you're, you know, still building it and feeling probably somewhat uncomfortable about the polish on the product.

Colin: But to me, that would be my. My big recommendation is that, yes, low code, no code tools aren't perfect. Can they solve the pain enough to where you can start to test it out? If not, and you need a little bit more development talent on the back end, then you should be able to cobble, you know, something together that's helping you save money and get that kind of first version out into the hands of prospects so you can start to get feedback.

Colin: And, um, you know, the Y Combinator said one of the Biggest indicators of success for building software is how fast you can iterate. So that's what I would really be focusing on is you're going to run into issues and problems, but how fast can you work through those? Is really a key factor. 

Mehmet: Yeah, absolutely.

Mehmet: And for me, you know, I'm a big advocate actually for these tools. I know, of course, we know the limitations, uh, but [00:23:00] as someone who tries to help founders mainly, I talk a lot about idea validation and when you want to do idea validation, of course, the minimal viable product is what comes to mind. And there's no better, I would say, I Tool today like this no code local tools that allow founders to You know, build things really fast.

Mehmet: I did some tests last year, you know, and I was trying to come up with a little bit hard ideas, not the easy ones, not like, for example, directories or lists. I was trying like to do something like, I would not say very complex, but a little bit more sophisticated, uh, probably because, you know, I had the hats on experience.

Mehmet: It took me less than 24 hours to figure it out. But I thought if someone opened YouTube, watch some videos, like maybe to watch how Zapier works or like the other tools for automation, how some of the no code tools like. You know, bubble, software, all these tools, uh, Webflow, you know, I, I [00:24:00] thought like, you know, someone can sit in a week and watch some videos and start to, you know, get their hands dirty as they say, and probably they would, it would take them, I believe one to two weeks and they can have a product.

Mehmet: And the good thing about that, because I was thinking always from a techie guy perspective, I said, if. Instead, as a non technical founder, if I want to go to a developer and tell him my vision, I might struggle because, you know, I cannot translate what I'm trying to do. But if I go and show them, Hey, this is what I want to build, right?

Mehmet: So this is, this is the prototype I built. Make it for me scalable, make it for me, make it for me. So yeah, absolutely. Now, Colin, I want to ask you about two things which you, you, you know, we, we talk or you talked about. So first one is the idea. So in your opinion, what makes an idea really. Worth to try to build it and especially from from a [00:25:00] non technical founder perspective And you mentioned a couple of things you tried to do before You had to kill some products and you had to continue with some of course I can understand, you know the limitations But what makes an idea really worth to validate in your opinion?

Colin: Yeah. So I think the number one thing is that, um, you know, hopefully it's an idea that you're at minimum interested in at, you know, maximum that you're really passionate about solving. As you and I know, it's very difficult to, um, to build a business. It's very difficult to get a product, um, to scale. So you're going to have to, um, really have the fortitude to work through all of the different issues that you're going to run into.

Colin: So that's number one is, is hopefully you're interested and passionate about the idea. Um, if, if it's something that you feel like, you know what, I can make money at this. I have a really [00:26:00] good line of sight on how to build it. And yes, I'm, I'm interested in it. I'm not passionate about it, but I think this is a business that could really work.

Colin: Um, and you know, I have an exit strategy of, you know, You know, maybe you're selling the business in, you know, three to five years, whatever, you know, I'm not going to tell you not to, not to go after something where you think there's an opportunity to, to really build a business. Um, so that, that, that's the first thing, you know, I remember listening to Guy Kawasaki.

Colin: Many years ago. And he says, you know, don't listen to the bozos. Um, and a big part of that is, you know, if you have, uh, an idea and it's something that you're interested in pursuing, don't worry about what other people say that are shooting it down. If it's something that you truly believe in with that being said, I think one of the things you want to start to do is get some feedback or some data points around the idea.

Colin: Um, So a couple of things there. Uh, number one, uh, [00:27:00] I would recommend thinking about talking to your prospects. Uh, you want to do it in a way that is not even giving them an indicator that maybe you're trying to build a product, but you're really trying to understand how they are, um, Either running their lives or running their work in ways that give you an Understanding of what it is that you should be building more specifically So there's this book the mom test, uh, which which I read which does a really nice job talking about How to talk to prospects without telling them what it is that you're building because if you go out and you tell people hey Like what we did with our very first product which was called by the change.

Colin: We were like, hey, we're going to build this Um, you know Online marketplace where you can do all of these things. Does that sound like a good idea? Well, we got tons of people [00:28:00] saying, yeah, that sounds like a great idea. Yeah, I'd use that for sure. Uh, and then we launched and it's just crickets. None of those people are, are, are, are using it at all.

Colin: So, um, if you gotta be really wary about your idea, if you're just going and telling people about it, um, because most of your ideas will probably sound pretty good to people. Um, and, uh, Most of them probably won't actually act on it. So, uh, you know, from an idea perspective, you want to have interest or passion around it, make sure that it's something you can make money at.

Colin: Uh, number two, you know, you want to engage with your prospects in ways that are helping you make money. Uh, understand, you know, their pain and how your product can address that pain. Uh, and then, you know, I think another thing that you can do in trying to validate the idea, and I've done this numerous times, which is, you can set up landing pages, uh, with the idea Um, and, uh, [00:29:00] you know, have an email, um, like subscribe link or whatnot for when the beta goes live, uh, and then start going out.

Colin: And so I've run campaigns on LinkedIn, you know, cold email, um, and have gotten. You know, thousands of people to sign up for the different products that we've launched or that we've launched with our clients and, um, getting that initial audience of interested users is a really great way to, um, you know, actually launch your MVP when you're ready to launch, but it's also a good indicator on, do people even care about what it is that you're looking to build?

Colin: So creating a landing page with. Copy and calls to action, uh, and then going out to your target market, even before you've built anything is a great way to, to start getting that audience, um, your target audience to start giving you at least some, uh, data validation that they're interested in. You can even reach out then to some of that audience [00:30:00] and see how many would be open to just talk for, you know, 10, 20 minutes about your idea, um, or about their pain more importantly.

Colin: So, that's what I would say around idea validation is, um, kind of, you know, following, like I said, hopefully you have interest and passion, number two, hopefully, you know, You can get into conversation with your, your prospects around their pain, um, without divulging necessarily what it is that you're building.

Colin: And then number three, you can build landing page and start driving traffic from your targeted audience to that page and see if they'll actually sign up. And then even have conversations with some of those people, um, after they've signed up and see if they'll talk about, um, their pain and, um. You know, potentially your product.

Mehmet: Absolutely. And you know, I always, when I talk to people about they say, Hey, how we can validate our ideas, uh, I give them a lot of examples, of course, of many companies that they did the right way. And what you just mentioned, the landing page with the call [00:31:00] to action, you know, collect the emails, Hey, like, tell me when this is ready, or, you know, we are launching soon get notified when, when, when we are out.

Mehmet: Uh, in, in public, uh, another way I give the example of, uh, of Dropbox and they're famous, you know, they even recorded the, you know, the video before even having the product, they find out that, you know, there's, there's a high demand on, on what they were trying to do at that time. So absolutely now, uh, shifting a little bit gears here, uh, and you know, of course, sometimes in this entrepreneurial journey, we need.

Mehmet: to have some funding, right? Uh, of course, all the time and every single guest on the show, when I ask them, we prefer, you know, when I say we, me and my guests, it depends, of course, what they are trying to do. It depends. I know that it depends, but of course, you know, put strapping first, [00:32:00] but at some stage you're going to scale the business.

Mehmet: somehow, or you're going to need some more resources either to build or to go out and, you know, do marketing and whatever. So, and when I was researching, I found that you came up with the shared success agreement as a another concept to traditional funding methods. So tell me about this and what was the inspiration behind the shared success agreement?

Colin: Yeah, no, that's, that's, that's great. So, um, so again, I'll take you back with a, with a story. Uh, so when we were building that product, SMB tweet, which was that Twitter product that would grow a Twitter following for small businesses, the developer that we hired, uh, said to us, look, I know you guys are in bootstrap mode, says my normal rate is a hundred dollars an hour, but I'll charge you 50 an hour to build the MVP.

Colin: But once the MVP is built and launched, I want 10 percent of your [00:33:00] revenue to go back to me and pay me out at 150 an hour until I'm paid out on all the hours that I put in to build the MVP. And we said, okay, that, that sounds like a good deal. So we paid him 50 an hour and he got paid to build the MVP, which he was satisfied with.

Colin: We got our MVP and we started to generate revenue and he ended up then getting paid out at 150 an hour. So we got an additional income stream coming in and he didn't have to put in any more work. And he was really happy about that. And we got our MVP bill and we didn't have to give up any equity. And so.

Colin: That was really the kind of the kernel of the idea for creating the shared success agreement. And so when we started Cloudburst is a software development company. We wanted to offer shared success to some of the clients that we worked with and, um, and it's worked out, you know, phenomenally well. Really, we see shared success as being an alternative to [00:34:00] debt or equity or crowdfunding.

Colin: Uh, shared success is, it's very lightweight. Uh, you don't have to worry about cap tables and valuating, evaluating, you know, the, the business and, um, you know, there's a lot less hoops that you have to jump through. Um, so, but you also have to understand that when you create a shared success agreement, the, the founder is not.

Colin: Occurring debt. So it's not a guarantee, um, that that money has to be paid out. Um, so, you know, as the, as the service provider, as you know, if you're discounting your services for a share of future revenue, you know, you're really kind of banking on that. This founder entrepreneur that their business, um, is going to continue to generate revenue if they are, are, are already an existing business or that they will generate revenue if they're net new.

Colin: Um, but it is a wonderful way to get in partnership with each other. And so kind of the basic premise, and we actually created a website called shared [00:35:00] success agreement. org. Where anyone can go and create these shared success agreements for free. We don't make any money on it. And the shirts, the, the calc, there's a calculator built into it where you can, um, play around with different numbers around, you know, how big is the, um, You know, the, the project or the investment, um, you know, what percentage of that is going to be shared success and what percentage is going to be your, maybe your normal rate.

Colin: Um, and then of the percentage that is going to shared success, uh, what kind of a multiple would you want on it? So, you know, maybe the project is 10, 000, 5, 000, you're going to get paid your normal rate. 5, 000 is going to be shared success. Maybe you want a three X multiple on that 5, 000. So that's really going to turn into 15, 000.

Colin: that the entrepreneur needs to pay you back. Um, and then you're able to, um, decide, um, you know, kind of over what [00:36:00] period of time you think that might, um, happen. And, um, then the, the calculator will actually show you what, what your return would be, you know, if you're providing services through a shared success agreement.

Colin: Um, so a founder. Our entrepreneur or a service provider can both, you know, utilize this calculator and see what, um, how the numbers come out. Um, you can also give money through a shared success agreement. Um, and you don't have to be an accredited investor. So, uh, shared success agreement is also opening up the opportunity for founders to get money through a shared success agreement, um, instead of having to get money through equity or debt.

Colin: So. Uh, there's a lot of value there as well for the entrepreneur. So I highly encourage anyone that's looking at funding to also look at sharedsuccessagreement. org as a way to look at getting funding in a very founder friendly way. Uh, and then when you play around with the calculator, when you're done, Again, there's only like five or six fields when you [00:37:00] submit, um, kind of this form on it, uh, you'll get emailed the shared success agreement in a word document with, uh, kind of a bunch of the legalese that's in it.

Colin: And then you just need to fine tune the agreement between you and the other party, but it's just a really a great way for, um, You know, founders and entrepreneurs to get in real kind of win win, um, arrangements with service providers or Funders people giving them money. 

Mehmet: That's a very interesting way of doing it now I'm, not you know, like this is this is to me looks like a win win for everyone, right?

Mehmet: So You know, and there's no risk also as well. Uh, I believe such concept needs some time too For at least in in the in the region where i'm living uh, but Yeah, but the other day I was talking to a friend and he found someone actually [00:38:00] It's not like they don't do it this way. So they build the mvp They don't charge money Until you know, they can tick all the boxes that they were agreed on before.

Mehmet: So there is an agreement. It's not like a shared revenue agreement. So if they don't tick all the boxes, they don't actually, they don't ask for the money. And then after that, when everyone say, hey, yes, we can sign this off. So then they will pay them whatever. Right, that they agreed on. But your concept is more, you know, towards people who, you know, they want to build it in a proper way faster, I would say.

Mehmet: And then, you know, it probably would let them skip, I would say, maybe the engine round kind of, if I'm correct, Colin, is that right? To skip the what, did you say? The engine round, you know, like looking for engine investors. Oh, I see. Yeah, so the phase where they want to say, hey, I have [00:39:00] this concept. I'm still in a pre seed phase.

Mehmet: I have the idea on paper. I validated it, but I need someone to build it for me. Right? 

Colin: Yeah. Yep. Yep. No, I think, um, you know, it's really those, those kind of the pre seed round, uh, where you're looking to get enough traction on the product, um, where you could have a shared success agreement in place, um, because Once you actually start to take on investors that are wanting equity, what you'll, you'll find is they're going to want to see like a cap table.

Colin: They're going to want to understand how their, your business is structured legally. Um, but the beautiful thing again, about a shared success agreement is that you don't. You're not, you're not affecting the cap table. You're not affecting anything. And so it doesn't mean that you, you know, you still need to pay, um, the funder or the, you know, the service provider back if you're the entrepreneur.

Colin: So each month you're supposed to record your [00:40:00] revenue and then whatever percentage of that revenue needs to go back, um, to pay back whoever has helped you. You know, build, um, or fund, um, your, your product. So, um, certainly you still have some responsibilities, but it's in a much more, um, lightened way where you're not having to deal with a bunch of legal.

Mehmet: Absolutely. Yeah. A hundred percent. And yeah, like this is something also repeated on the show. So you really need to go for funding when, you know, you are probably advanced stage. So when you, you know, you have the business, you know, you, you don't want to give a lot of equity because a lot of things that I figured out recently, which I thought that's common sense, uh, first time founders, they get shocked to know when, You know, to, they, they get to know that they're going to lose equity more on the long run, because probably the first round, they're going to give [00:41:00] 20 percent and then they're going to give 10 percent and then they end up by keeping 9 percent or so at the end when they're going to exit.

Mehmet: Right. So it's, it's absolutely to, to, to try. I'm not saying to avoid, of course, at some stage, if you are going to, to have this massive big product, Uh, which would be a global product. Of course, you need to have, uh, you know, funding from from VCs and, you know, like private equity maybe. But yeah, so as, as long as you can delay this, the better it is just to avoid the dilution.

Colin: Yeah. 

Mehmet: Um, 

Colin: I was just going to say, there's a whole, you know, kind of with this rise of the non technical entrepreneur, there's also just this rise of bootstrapper businesses where they're profitable businesses, they're growing well, and they don't need to take funding. Um, so, you know, funding doesn't always have to be, you know, where you're giving up equity.

Colin: That doesn't always have to be a path. Um, the, the biggest thing that you want to do is build a business. That is solving a pain where you're able to grow and you're [00:42:00] able to scale. And if you're able to do that, you're also reducing risk in the eyes of investors, which gives you the power. And so what you want to do is ensure that your.

Colin: At each stage reducing risk in the eyes of whoever may be investing in you Um, so that's what I would encourage You know anybody listening that's an entrepreneur is reduce that risk that puts you in a position of power And that will allow you a lot more flexibility in how you want to grow your business 

Mehmet: Absolutely Now as we are coming almost to an end colin like, you know after all these experiences that you have, you know Uh, and I I believe you know, I wish I could have Some same story, like you, you, you always been an entrepreneur and you created great products and companies.

Mehmet: So if you want to leave the audience today with like final, I would say advice. And final words of [00:43:00] wisdom, if you want to talk it this way, uh, what you would tell them? 

Colin: Yeah, a few things. You know, for me, having business partners has been an absolutely wonderful thing. Uh, you know, being an entrepreneur is not an easy path.

Colin: And if you do it alone, it can also be a very lonely path. So I feel very fortunate to have two business partners where, you know, we put our friendship and our families, um, ahead of the business. And that's allowed us to have been in business together for over 15 years now. And, um, so I would highly encourage if, if, if you can find business partners that, um, You know, you trust and that, um, could really enhance your entrepreneurial journey.

Colin: Um, take a hard look at that. You know, the other thing is, is, you know, if you're building businesses in areas that you just love and enjoy, uh, that is another wonderful avenue and path to take because [00:44:00] that during those tough times of being an entrepreneur that um, just enjoying the work or at least enjoying the industry that you're in Uh makes that hard work just that much easier So I would highly encourage you to focus in on areas that you have interest and passion around The other thing I would say is pay attention to Your natural gifts like what are you?

Colin: What are you good at? Um, what maybe comes a little bit easier to you? What do you enjoy? Uh, you know, if, if you are, um, Non technical and you're trying to learn code and it's incredibly difficult, but you, you know, have talents in, you know, marketing or branding or building a community, you know, focus in on the areas that you're good at and do that and then fill in the gaps of other people.

Colin: Helping you out. So that would be the other thing. And then I would also say, you know, um, try and get validation on the product. Really. I [00:45:00] would highly encourage you to go after the bootstrapper path. There's tons of communities. There's tons of resources for you to learn, um, you know, how to, to How to get started.

Colin: The last thing I'll say too, especially for those entrepreneurs that have existing businesses, you know, there's really never been a better time to, to build software, to, to scale a business. And, uh, so I would take a kind of a really hard look at your opportunities as a, as an entrepreneur that already has an existing business and how you can create value.

Colin: You know, one of the things we just talk about for as an entrepreneur, wanting to scale with, with software is, you know, number one, have a vision for what you want to build. Number two, get the MVP built and get it in the hands of your team and or your customers. Number three, if you're able to, um, get, you know, usage and good feedback, uh, from your internal team and customers that this is a product that they value, you can start [00:46:00] then in stage three, using this product as a differentiator as you go to market.

Colin: Um, and as you are talking to prospects, you can say, look, We have this product. None of our competitors have it, and it's giving this type of a wonderful experience or this type of result. Um, so that's stage three is, you know, helping, um, you close business with your software. Stage four is if you can prove that your business is scaling with software.

Colin: Now you've added a multiple to the value of your business, uh, investors, uh, or people that might want to buy the business are going to see a lot more value in your business. If you have something that is proprietary, that's helping you scale that your competitors don't have. Um, Now you've created a multiple to the value of your business.

Colin: It's a lot of entrepreneurs may stop at stage four, but some entrepreneurs will want to jump to the final stage, which is, which is stage five, which is if you have created software that is addressing this pain for your company in your industry, it's very likely that other companies in your industry [00:47:00] would also want this software.

Colin: So launching your product as a SAS product is a wonderful way to truly scale in ways that you just can't do. Um, You know, with, uh, with, with people, because with SAS, you're scaling with tech. So, um, that final stage five is releasing your product as a SAS product into the industry. So that's what I would say for kind of thinking about like the stage of your business and how you can grow with software.

Colin: Um, that's a wonderful way to, to think about it. 

Mehmet: I would really say These are great, you know, like I never thought about these five stages. So that was very enlightening I would say Colin. Thank you very much for sharing this final thing where people can find more about you and learn about your Company.

Mehmet: Yeah. 

Colin: Yeah. No, that's great Um, so you can find me on linkedin at colin herdman h i r d m a n And connect with me there. I love connecting with other entrepreneurs around the world Um, I [00:48:00] also you can also find me at cloudburststudio. com. Um, we, um, we have a clarity canvas, which is a free one and a half hour workshop for entrepreneurs to talk through their software.

Colin: If you have an idea that you want to discuss, um, and, um, yeah, and, um, monkey island ventures. dot com is the site that talks more about kind of our umbrella company and just the different companies that we have and, um, the investments that we've made and things like that. 

Mehmet: Great. I will make sure that all these websites and links are in the show notes, uh, at the end, Colin.

Mehmet: Really, I appreciate the time today. A lot of valuable, uh, insights and, you know, your long experience, of course, in, in the domain of entrepreneurship. I'm sure that the audience, uh, would benefit out of it. So thank you very much for sharing that with us today. And this is how I end usually my episodes. So this is for the audience.

Mehmet: If you just discovered this podcast by [00:49:00] luck, thank you for passing by. I hope you enjoyed it. If you did, so please subscribe and share it with your friends and colleagues And if you are one of the loyal followers and loyal audience Thank you very much for keep sending me all your notes all your remarks all your comments and suggestions Please let them keep coming.

Mehmet: I really appreciate that and if you are an entrepreneur wherever you are in the world You have an idea, you want to share it with the rest of the world. Don't hesitate to reach out to me. This is why the show exists. If you have even something, which is you think no one would care about, we can discuss that if you know, there is a match, of course we can, uh, record an episode together and make it out to the world.

Mehmet: Thank you very much for tuning in. We'll meet again very soon. Thank you. Bye bye.