Building a Business Meant to Last with Peldi Guilizzoni of Balsamiq

Courtland Allen 7s

What's up everyone? This is Courtland from Indiehackers.com and you're listening to the Indie Hackers Podcast. On this show I talk to the founders of profitable internet businesses and I try to get a sense of what it's like to be in their shoes. How did they get to where they are today?

How do they make decisions at their companies and in their personal lives? What exactly makes their companies tick? The goal here, as always, is so that the rest of us can learn from their examples and go on to build our own successful online businesses. Joining me in today's episode is Peldi, the founder of a company called Balsamiq Wireframes.

Balsamiq is a graphical tool that you can use to sketch out the user interface or pretty much anything, so if you're building a website or a web app, a mobile app, or even a desktop app, it doesn't really matter. No matter what it is, you can use Balsamiq to quickly put together a wire frame for what the interface should look like.

On top of that, Peldi was also one of my earliest inspirations as an Indie Hacker. He famously started blogging about his adventures as a solo founder and what he was working on and even exactly how much money he was making way back in 2008, when it seemed like pretty much nobody else was doing this except for a small handful of others.

So it's safe to say that Indie Hackers itself would not be here, if not for the efforts of Peldi and people like him. So Peldi, welcome to the show. I am stoked to have you on here.

Peldi Guilizzoni 1m 17s

Thanks for having me, Courtland. You're too kind.

Courtland Allen 1m 20s

You started Balsamiq in 2008, so that means the company turned 10 years old last year. To the best of my knowledge, you guys are generating something like $6 or $7 million in revenue annually. Is that right?

Peldi Guilizzoni 1m 32s

Around six. More six than seven.

Courtland Allen 1m 35s

What I want to talk to you about the most today is Balsamiq's longevity. How exactly do you bootstrap a company as a solo founder that ends up growing and staying healthy for over a decade? So that's it. That's my only question. The rest is just going to be 50 minutes of you answering that question.

Peldi Guilizzoni 1m 52s

No problem. I got one answer – luck. Luck is the answer. No, I don't know. Interview over.

Courtland Allen 2m 0s

My goal here is really just to ask questions that date you and make you feel as old as possible this entire episode. I did the same thing to Rob Walling.

Peldi Guilizzoni 2m 7s

I was looking at all the other previous guests on this podcast and I was like, "Oh man, these people are all younger, better looking, and more interesting than me." I feel like an old guy now, but that's all right. I'll take it.

Courtland Allen 2m 25s

Well, I don't know about younger or more interesting, but better looking for sure. (Laughs.) So let's talk about the early stages of Balsamiq. And I know this is ancient history at this point. This is 2008, but I think most people listening in are at the phase where they just want to start a company and they're looking for inspiration around these very early days. Do you remember how you first came up with the idea to start Balsamiq?

Peldi Guilizzoni 2m 48s

Yes. I grew up in Italy and I moved to California to go to Silicon Valley and be a programmer there. And what I told my parents was, "I'm going to go to San Francisco and learn everything I can about making software and then move back to Italy and apply that knowledge here." And that was a total lie.

It was just a way for them to be able to say, "Yes, okay, you can go as long as you promise you are coming back." But really what I was thinking was, “I'm just going to move to California. I'm just going to work for a large corporation, climb the ladder, and I'm going to be happy doing that.”

And so that was my goal. I didn't really have any entrepreneurial spirit right out of school. So I worked for Macromedia, then it became Adobe, for six years. And every year, I started as a QA engineer, then I became a program developer, then a lead developer. Every year I would get a promotion, get a new boss, and climb the ladder, which was fantastic.

Then after maybe four or five years, I read somewhere about this book called, "You Have to be a Little Crazy: The Truth About Starting Your Own Business.” And I thought, that sounds interesting. Let's see. And so I bought it as a short little booklet. I got to page 16 before throwing it in the corner, saying, “No, no, no. This is not for me. I'm never going to start a business. It's insane.”

Courtland Allen 4m 23s

What turned you off?

Peldi Guilizzoni 4m 24s

It just basically spoke about all the realities of the pressure it puts on your family, yourself, and financially and all – the book is biased. It only talks about the bad stuff, of course. But it worked for me because it really made me happy to be an employee where I was.

So then after another two or three years, I was getting tired of just being a developer. I worked on a large team at Adobe. We were making an online meeting software and I worked with designers, product managers, other developers, QA, translation, legal, sales, support. I kept thinking, "What do all these people do all day?"

I understand the development part and that's fun and I love it, but there is a lot more. How do you price a piece of software? How do you decide to support things? I was just very curious and so I thought, “Maybe I'll become a product manager,” because the product manager, I could see, was the in between person that interfaced with all the other teams, including the development team that I was part of.

And I thought, “That sounds like a fun job. That way I can learn more about all these different parts of making software.” And so I seriously considered becoming a product manager. The problem was that at Adobe you have to have a business degree, an MBA, in order to become a product manager. That was a prerequisite, which is not there anymore, I've heard.

But at the time, you had to do that. And so I seriously considered going to business school just to become a product manager. And then my product manager friends at Adobe talked me out of it. Thank goodness. Basically they said, "You're already making too much money. You have a family now, you're not going to be able to forego your current salary and spend a hundred grand a year for three or four years to go to business school.

That's too late. Also, a big part of the value of going to business school is that Rolodex that you get at the end of it. So these are your contacts that you will work with and it's your network that will serve you well during your career. You don't really need that because you already have a network of colleagues and friends.

And so they said, "Buy this book called "Ten-Day MBA" and you'll get the basics of the actual business part." And so I did, and it was very interesting. It was all new to me and it was very fascinating. It was very interesting, and I thought, "Okay, if I'm not going to become a product manager here, how else am I going to learn all the business stuff, all the non-programming stuff?

And at the same time I had seen another company called Gliffy. These two guys in San Francisco and they made a diagramming tool that interface with that classic confluence wiki. And I heard there was two guys and we love this tool and I thought, “Oh man, I could build something like this.” The tool was also built in Flash, which is what I was working on.

So I was like, “Maybe I can do a similar tool but more focused, smaller,” because it was something that we needed for work. And so I thought, "This could be a way for me to learn. I could just start a company of one person. And that way every single thing has to go through me and I'm going to have to figure out every single thing."

That's really what my motivation was to venture out was the whole thing was a learning experience that I never believed would last more than a year or two. So what I did, was I decided I was going to do this, and I put away enough money to live off of for a year and then I quit my job and saying, "I'll probably be back in a year, please." I might come back in a year when this fails, but I want to basically take a sabbatical to try it out, to learn all this stuff. So that was my motivation.

Courtland Allen 9m 1s

Luckily, you're in San Francisco, where quitting your job and starting a company wasn't even that crazy.

Peldi Guilizzoni 9m 6s

That was the thing to do in 2008, or it still is, I bet. It is a crazy environment where you -- that's considered not so crazy, and in fact a lot of people do it. My difference was that I couldn't afford to do this while living in San Francisco. So I moved back to Italy where I'm from to do it because the cost of living was a going to be much cheaper here.

Courtland Allen 9m 33s

Yeah. I tried to stay in San Francisco and bootstrap Indie Hackers from here when I first started it and the rate at which I was burning through my savings, I do not recommend it. Do you remember some of the early decisions that you made when you left to start Balsamiq and how the idea kind of shaped in your mind early on?

Peldi Guilizzoni 9m 52s

My instinct is to reply nothing, but actually it was not nothing because I had worked at a large, successful software company for six years. I had absorbed a lot from my time at Adobe. I often tell people who are out of school and they're thinking of starting a business that it's much riskier to do it that way rather than, go work at Google, go work at Apple and go work at some large company for a while.

Do your time, do your homework, build a network, make your mistakes in a sheltered environment before jumping in. You will learn so much and you will have a network of advisors. And I know that's not advice people want to hear, but I feel like for me, it was critical to my success.

And, too, because of my experience there, then when I decided to quit and jumped, I started reading books like crazy. I read usability books, a web design books, marketing books. Not just books, but back in 2008 we had a thing called RSS. So I was devouring articles on different blogs and resources. Thankfully content marketing was becoming a thing.

So there was all this free content to learn from. Not too much, like right now, it was just the right amount then. So I spent months, the months before launch, just studying and studying and studying. And you know what? I haven't stopped. I still don't know what I'm doing and I'm still learning a ton and doing online research about this and that. That's why I'm doing this.

That hasn't changed at all. My motivation has always been to learn and keep learning and keep getting better and just try to crack this crazy nut that is owning a software business.

Courtland Allen 11m 52s

I've watched a lot of your talks over the years and I think more so than anyone, you spend a lot of time quoting other founders, other entrepreneurs. I can see that you're forever a student and you're always learning from others.

Peldi Guilizzoni 12m 5s

Yeah, absolutely. Being a pundit, to me, that's offensive, I don't know anything. I just try to learn from everybody and put it together and try to give it my spin. But I don't feel like I've come up with a single good idea.

So that's kind of a probably heartening for your listeners. You don't have to be this crazy genius that can have these deep thoughts. You can just absorb from others.

Courtland Allen 12m 36s

Or you can always pretend to be one. So you got pretty far as a solo founder before you ever started hiring anyone. Do you remember how far you got as a solo founder?

Peldi Guilizzoni 12m 45s

It was about 3000 customers. It was about eight months since launch. I was alone, actually, I'm lying. About five months in, I asked my wife for help to answer some emails because I was drowning, and she did that for a bit. But then after about eight months, I started doing support all week, all the non-development stuff, all week.

And then I would code on the weekend when the emails were not coming in so quickly. And so I did six weeks of this regime and then one morning I woke up sweating bullets thinking I was going to die. I can't do this anymore. And so I thought, “I'm going to have to hire someone,” which was terrifying to me because that was never the plan.

My inspiration was Patrick McKenzie who spoke on this podcast before. He had this Bingo card creator. He had a one-person business for many years. That was my goal. Or Andy Brice with the Perfect Table Plan. I love that idea that you can have a tiny little thing that you just care for and you serve your little niche market and you do that and that's your lifestyle business.

That was my absolute dream. Hiring someone else did not fit in that dream. It was going to be much more responsibility than what I wanted. I was not that ambitious, but I sort of found myself being forced to change my dream. And so I hired a developer telling him, “Listen, I have one year of salary in the bank right now. I can guarantee you that. After that, we'll see.”

I was still thinking it was going to fail. But then it grew from there. So over the years I've had to do this changing dream, being forced to change my dream several times as the company grew and grew.

Courtland Allen 14m 54s

Three thousand customers is a gigantic amount to grow to in – I think you said eight months, just by yourself. Do you remember how much revenue you were generating?

Peldi Guilizzoni 15m 4s

It was not fun. I don't really know. Let me try to remember. I think the first year I generated about $165,000.

Courtland Allen 15m 13s

Wow.

Peldi Guilizzoni 15m 14s

That was in six months, 2008, that was in the first six months. It basically blew up in my face. Talk about product-market fit. The first sale happened four days before I actually, officially launched. I got an email from the credit card processor and I was like, “That's strange because I'm not testing that right now.” And then I looked, and it was an actual customer that had found me via Google and had bought the software even before I launched.

Courtland Allen 15m 42s

That's great.

Peldi Guilizzoni 15m 42s

So it really sold itself from the beginning.

Courtland Allen 15m 46s

Do you remember what you were doing to find customers? It sounds like it took off. That many customers, it's not like you found them each one by one by hand or anything. What efforts were you putting into to finding people?

Peldi Guilizzoni 15m 58s

Nothing. It felt like being on the outside of a rocket hanging on with my fingers. And the rocket was just going, and I would kick it to try to steer it in a direction or the other. It just came by itself. What I did was focused on the product. The product was good and was a unique.

I had a viral component inside the product. Before Balsamiq – this sketchy look, the hand drawn look, only existed in SketchUp, the 3-D modeling tool. It's very weird to build software that lets your customers generate crappy looking things. That took some guts, but it's the right thing to do.

As soon as anybody saw a wireframe made with Balsamiq, they would immediately ask, "Hey, how did you make that?" That's very unique. The software itself was its own marketing. Other than that, I was really craving feedback because the software was 1.0.

And it was a crappy piece of software. It was very young. So I wanted to know – find out which were the roughest edges, what I should work on first. I was craving feedback. What I decided to do was to donate the software to bloggers in exchange for an honest review. And this had the side effect that my software was on everybody's blog all of a sudden.

It turns out that bloggers really like free stuff. And so I had a ton of reviews and they were mostly favorable, and they linked back to my site, which generated good SEO. In hindsight, it was a genius move. I was honestly doing it as a way to get reviews, ideas on what to work on next.

Courtland Allen 17m 59s

Reading a blog posts from 2008 – January 2009 when you're looking back at 2008. You mentioned that you were the number one result on Google searches, not only for Balsamiq, but also for web office plugins and for just the word “mockups.” So I imagine that this blogging strategy really paid off. You had tons of searches coming in from Google.

Peldi Guilizzoni 18m 20s

The other thing is that I picked a tiny niche. I did because I wanted this software to exist and I googled around and found nothing. So clearly the other players that were there were not very good and did not do good SEO. The bar was pretty low right when I came in.

Courtland Allen 18m 40s

So 10 years is a long time. We're talking about stuff that happened back in 2008. I don't even know how to walk through the story of Balsamiq in 10 years and just the time we have remaining. Let me ask you, if you had to divide Balsamiq up into phases or eras, what would they be?

Peldi Guilizzoni 18m 56s

Right now we're around version four. So in 2007, this was before launching, we call this phase “the idea”. I had made a business plan and I built this sort of MVP, etc. Then 2008 to 2010 a couple of years was more of a version zero or a, let's see if this works phase. It was me and then it became two or three of us.

And then in 2010 we had our first company retreat. There were six of us. I thought, this is it. This is what I want forever now. I don't want a large team. I wanted to be alone and that failed. But I think with six people, we can do this for a long time. I'm comfortable managing five people. That lasted three months, (laughs) that phase.

Because what happened? 2010, we got an acquisition offer and we came very close to selling the company. And as part of that, we realized that this vision of staying with six people was just not realistic. We were forced to come up with a new vision quickly.

We rejected the offer and entered this new phase, which was, we hired three or four more people and we tried to grow to become big enough that we won't get an acquisition offer ever again. That was the goal at the time. That was Balsamiq 2.0.

And then in 2013, we hired six or seven people because we could afford to, we were overworked, and we decided to create a handbook in preparation for hiring all these people. The company went from 10 to 20 people, around that and that felt different.

Then in 2014 for a few years we sort of matured, we cleaned up a few things, we built some tools internally that help us work better. So for a few years we did that. We refined our processes. Then, let's see, 2016 until today, we're about 20, 25 people. We are codifying more of how we work. We're still a flat company and I have a whole talk online about this phase.

Then recently, the last six months or so, or maybe twelve months, we're entering a whole new phase where we basically try to get set up for another decade of success. The first decade was too much revolving around me, and the goal of the next decade is to have Balsamiq become independent of me, stronger than me, just a bigger, more solid, a better company.

And so we are in the process of trying to define how that's going to work.

Courtland Allen 22m 7s

I met you at the Business of Software Conference last October and you gave a talk about this new phase, this next decade of Balsamiq and you called it, "You've Made It. Now what?"

And I really want to talk about that, hopefully toward the end of this episode because there's a fascinating talk that I haven't really heard very many people speak toward. But before that, you made a lot of early decisions at Balsamiq. You made the decision to have your mock ups look like these hand drawn sketches.

So they didn't look great, but they were quick and dirty. You made the decision to target a really tiny niche. Looking back now, 10 years later, are there any decisions that you fretted over in the early days and ended up not mattering at all? And which decisions would you say mattered the most for you to build a company that lasted so long?

Peldi Guilizzoni 22m 49s

That's a tough question because I have a very bad memory. I am still fully oriented in the future. I don't dwell on a past decisions much and maybe that's part of the reason for my success, I think. Who knows? I've made lots of bad decisions. I do that all the time. It doesn't really matter though.

What matters is how quickly you can fix them and learn from them. So it's hard for me to say, good, bad, good, bad, right? So about worrying about things at the beginning, everything seems impossible. It seems like you're facing this giant wall and you have to climb it with your bare hands and because you've never done it before, like hiring a lawyer.

Things like that. Accounting stuff, figuring out accounting stuff. It's things that are so foreign that they look so daunting. How am I ever going to learn about this? But then you just have to do it and you learn it. And then once you learned enough, you look back and you think, “How silly of me to be so worried about this.”

It's not that hard. It always looks much easier after you've learned enough. You don't even have to become an expert to feel that way. So I've learned after a few of these experiences, I've learned to not be afraid of the giant wall and just know that it just looks giant because it's new. It's not, it's probably not impossible to master.

So that's the advice I would give to someone just getting started. If you feel that way, it's a good sign. It means you're about to learn a bunch. Be optimistic that in just a few weeks you will look back and think, “Why did I lose sleep over this?” Do you feel that way? Has that happened to you?

Courtland Allen 24m 48s

Oh yeah. All the time. I remember the early days of Indie Hackers. I was terrified to send each and every email newsletter that I sent. I was afraid to email advertisers.

I delayed doing that for two or three months just because I don't know, I just had some block around. I didn't want to do it. The podcast was terrifying when I first started. And even now making changes to the website is always kind of nerve wracking.

Peldi Guilizzoni 25m 10s

Yeah. Some of these worries are actually healthy. For many years I was behaving under the assumption that profit revenue could go to zero tomorrow. I wanted to be okay with that. I want it to be prepared for that. So that means that we have always saved a bunch of cash in the bank, for when that day comes.

We still have a policy where we keep 18 months of expenses in the bank at all times in case revenue goes to zero. That way we know we have 18 months to figure out how to make revenue restart. That's a good thing to do in general. So some of these worries, even if they're completely stupid, they help you behave responsibly. They're healthy that way, I think.

Courtland Allen 26m 3s

That's a really interesting example because it's illustrative of what I was talking about earlier, which is that you've bootstrapped a business that was built to last. Balsamiq has been around for 10 years, and that's because you set out to build a sustainable business that would stand the test of time.

You're worried more about the business sticking around and being a healthy business than you are about it growing as rapidly as it can at all costs and reinvesting all of your profits into growth.

Peldi Guilizzoni 26m 26s

That was never the goal. Our goal is longevity, not growth.

Courtland Allen 26m 32s

I think you're a guy, in general, who has a lot of unconventional ideas. You were doing a remote only company way before it was cool. You kept your workstation flat and you had avoided managers for as long as you possibly could.

You tried all sorts of experimental things like holacracy, you've described yourself as being allergic to collecting and analyzing metrics, which I think is anathema to many companies and startups. I think the list goes on. So what's the deal here? Why go against the grain so often?

Peldi Guilizzoni 27m 2s

It's not deliberate really. It's not that I want to be different. It's more about trying things out and seeing what feels right. I don't think I'm that much against the grain. The focus on the product the business model of selling a tool for money, that's not against the grain. You are against the grain. Silicon Valley is against the grain.

Selling items for money is the oldest business model in the world. The attention economy is the passing, terrible business model of the last 20 years. I'm not the different one. Everybody else is the different one. Same for all the other things. Trying to make a business focused on making it last a long time. Even the big startups, that's what they say they want.

Maybe for some of those startups, in order to be lasting a long time, they have to be the winner that they saw and that's fine, if it works for them. That was never my ambition. Maybe it's because I don't live in Silicon Valley anymore. Maybe it's because I'm not from there. Maybe because I am more cautious than ambitious. It's my upbringing, it's the people around me. It's what I read. Who knows? Every person is different.

Courtland Allen 28m 31s

I want to talk a little bit about the feeling of success because there's this concept of a hedonic adaptation or sometimes called the hedonic treadmill where no matter how much things change, we as human beings are pretty good at adapting. So you make $1 million a year, a year or two later, you've completely adapted to that and you no longer feel that much different than you did beforehand.

Balsamiq has always been growing. I think you said you're doing close to 6 million or a little bit over $6 million in revenue a year. Now you've got dozens of employees. At what point did you acclimate to this? Did it ever become normal? Are you still sort of looking around going like, "Wow, I can't believe this is my life?"

Peldi Guilizzoni 29m 10s

Oh, there is a good amount of that. A good amount of feeling blessed and lucky and privileged. A lot of my success comes because my parents sent me to California in the summer to learn English. If you read Malcolm Gladwell, “The Outliers” book is all about, you are the sum of your generations of people before you and the right timing, too.

So I'm very much aware that I am a white male. There's a lot of intrinsic privilege there. So I am very much humbled by the success that I've had. At the same time, in the last few years as revenue has stabilized, it's easier to get used to it because a lot of it is SaaS recurring revenue now and so it's more predictable.

And so with that you start feeling more secure that this thing is probably going to keep going for a while. At the beginning was up and down, up and down. And so it was like, let's live day by day. Let's not plan further than two months, because we might not be around for two months. But then as the company matures that horizon gets longer and longer.

About the treadmill, it is a very tempting treadmill to be on. It's very true. It's human nature. But I try to resist it. After a while if you make $1 million a year or $2 million a year, it's really not that different. The biggest difference right now is that I fly business class on planes and that is amazing. That is the best. Sorry. That's the biggest luxury that I want to give myself.

Everything else, it's fine. So it's all about sustaining it. It's all about making it last a long time. I have taken less dividends this year. We will take very little next year because the company, I want to reinvest in the company.

We hired another bunch of people last year and that's fine because I know that if I do things right this thing will last a long time and then I'll take dividends again in the future. Again, it's more about longevity than a quick buck. If it was about a quick buck I would have sold.

Courtland Allen 31m 46s

So let's talk a little bit about the practical aspects of longevity. A lot of people have companies where they figure out how to acquire customers. They figure out how to make a product that works for a year or two and then things change, and they have to change everything about their business just to keep up.

Has that been the case with you? And are there any big decisions that you've had to make, changes you've had to make to Balsamiq to keep it running and make sure it didn't become obsolete?

Peldi Guilizzoni 32m 10s

Not a lot because of the problem that I chose to solve. Because I was lucky enough to choose a problem with certain characteristics. The wireframing space is both too small for big players to go after and too big for small players to really compete with. If the market is about $10 million a year. If the global market for wireframing tools is maybe $10, $15 million a year total.

That's not enough for a big player to want to play. It's not worth their money to go after such a small market. At the same time, there's not too much room for big players, big in the sense of Balsamiq big, in a space like that. We were lucky to start dominating this market pretty early on. At the first few years it was competitive. And then we became the leaders in the space, and we've been left alone on both sides.

So this is a luxury that I have because of the size of the market that I went after. If you're going to try to become the next Instagram, you better believe that big people with a lot of money are going to go after you because the potential is huge. But if you choose a small enough market, people might largely leave you alone.

Courtland Allen 33m 44s

What about some of the practical aspects of acquiring customers? Have you changed the channels through which you guys have found Balsamiq wireframes users? Has SEO become more or less important over time or blogging or has it pretty much stayed the same since 2008?

Peldi Guilizzoni 33m 58s

We still basically don't do any marketing. We lead with the product. The product has to be so good that people tell their friends about it. And again, it sounds radical, but that was what Steve Jobs used to say about Apple products. If the product is good, everything else comes easier.

Courtland Allen 34m 18s

How do you make a product that's so good that you can really grow via word of mouth and people like to talk about how good it is to their friends and spread it that way. Because I think that's kind of a common goal. Especially as a solo developer, it's not an easy bar to hit.

Peldi Guilizzoni 34m 34s

No, it's not easy. It's true. It's not easy. Usability, user experience is – interface design is not an easy thing. It doesn't come for everybody naturally. But it can be learned. In fact, we have a whole section of our new website, Balsamiq.com/learn, which is all about learning how to do interface design as a non-designer.

It's not easy and it takes a ton of discipline. You say no 90% of the time because it might make a few customers happy, but it might muddle the experience for everybody else. It's a lot of self-discipline and focus. And also, this lack of ambition, right? We don't want to be the tool for everybody. We have a very narrow focus.

We are a wireframing tool, not a prototyping tool. We're not going to give you – you can link screens together, but that's it. We're never going to give you conditional flows or hover actions or all that. Other tools can do that. If we did that, we would have to charge more or change, compete with different players, change things completely and the tool would be harder to learn.

We're happy being the first tool you use and part of your tool belt. You don't have to only use Balsamiq, you use Balsamiq and other things. This laser focus and a willingness to leave money on the table is tough to maintain over time. The temptation is strong. But I feel like if you don't do it, you're shooting yourself in the foot.

We've seen it with a bunch of competitors that will compete with us and not be able to, and they would add a bunch of buttons everywhere and a bunch of features and then two years later they were dead.

Courtland Allen 36m 29s

Let's talk a little bit about this talk you gave at the Business of Software and the way that your role has changed in the last six months, you said. You're really looking forward now to Balsamiq over the next decade being a company that doesn't depend on Peldi and doesn't necessarily need Peldi.

You, at some point, tried stepping away to help the business run without you. When did you start feeling like that was something that you really needed to do and what triggered those feelings?

Peldi Guilizzoni 36m 54s

I think what triggered it was the fact that we turned 10. That, to me, was a milestone that I'd been looking forward to for nine years. I thought, all right, we lasted a decade. We're now 30 people. We're still flat, but not really flat because really, I'm the only people manager. I'm not doing a good job at that because I can't, I don't have enough time to be the manager – a good manager for 30 people.

What am I really needed for? And how can we redesign Balsamiq to be stronger than just me? Because I'm not going to be around forever. No one is. My focus shifted from building the product. The product is 10 years old, it's mature, it's good. We know what we have to do. But overall it doesn't require all my attention like in the past.

And so now after I had finished this milestone of running a company for 10 years, I needed to come up with another dream and another 10-year project for myself. I thought maybe this could be it. It could be figuring out how to build this company so that it can surpass me. Not just outlive me, but also be better than without me than with me. And to me, that's very exciting. That is an exciting experiment that I'm happy to dedicate the next five years or more to.

And so the first step was let's find out what I am really needed for. And I did it in a reckless way where I said, "Okay, starting today I don't do anything at all anymore. Let's see what breaks." And I did that for a few months and things broke. In the end, the experiment worked.

Courtland Allen 38m 52s

One of the things you started doing once you were able to pull back and let things break without your directed involvement was go back to strategizing and thinking at a higher level and watching videos of other founders giving talks and giving more talks yourself.

A lot of people in the audience are trying to learn this business of starting companies. What are some of the things that you learned once you pulled back and did more learning yourself?

Peldi Guilizzoni 39m 16s

I wish I had pulled back and spent time learning and strategizing. Really what I did was I pulled back and panicked and got depressed and didn't know what to do with myself or my life. So what I learned is, don't do it this way, do it more much more gradually.

And also, I think the main lesson is try to, and I know this is nearly impossible, but try not to tie your sense of worth to the company. Try to have a separate, fulfilled self, other than the business. And, that's, like I said, nearly impossible because if you're a founder that's all you think about day and night for ever. So there is no time to do anything else, to be anything else.

Although I've always kept a good family life balance. It's not about that hours you spend working. It's more about how you describe yourself to yourself. I've always been founder and CEO of Balsamiq. That defines me, but that's not healthy. It's healthier to have your own – be able to like yourself even outside of the work.

For instance, I started – I joined a woodworking class and there nobody knew me. So people laughed at my joke, not because I was the boss, but because I was funny and that made me feel good. Try to invest in your social life, in your connections outside of work.

Try not to think about work all the time. Try to do this. Try to think about your job as a job. You know, some day you might not want to do that job anymore. I know it's hard to imagine if that's your company we're talking about, but you'll be 75 one day and maybe you'll be tired of running the company. Thinking about it that way prepares you and is a good way to make the company stronger as well.

Courtland Allen 41m 29s

One of the really cool things that you did after you started feeling this way, you called up a bunch of other founders who have been in similar situations, who are very experienced, who had long-lasting companies and you asked them what they thought about life after an exit. In fact, you actually wrote a paper called "Life After An Exit".

And some of the quotes that you talked about in your talk, where you had a quote from Joel Spolsky where he asked, “Do you remember why you liked bootstrapping in the first place?” You had a quote from DHH, who advised you, “Hey, it’s your company. You can shape it however you want to make yourself the happiest.” Chris and Natalie Nagele of Wild Bit told you that, “Sometimes hobbies can make things worse.”

That was an interesting warning. And Jason Cohen told you to, “Be careful about running away from something versus running towards something.” How did this advice shape you? How should other people who are building companies think about really making the decision to separate themselves from their companies and do what you were just saying earlier, try to not define yourself as the founder?

Peldi Guilizzoni 42m 23s

Regardless of all the great advice that they gave me, the main benefit of reaching out was that I no longer felt alone with these struggles. Lots of people go through – whatever you're going through, there are other people that are going through the same phase of the company, the same struggles you have.

So having a sort of a mastermind group is, I feel, critical. It's like having a therapist. But better because they know exactly – they're living it as well. There's this study where they say that the strongest correlation to happiness in life is not money or anything.

It's the number and quality of your connections. And so that's something that I feel like a lot of founders tend to neglect, because they're too busy or it's lonely at the top.

You have to be the solo hero at the top of your company. But that's a mistake. Try to always cultivate a group of peers, which will change over time because you might outgrow your group. But try to really have these conversations. The conversations themselves is what matters.

Courtland Allen 43m 38s

I think that's a great way to end the episode. Talking about the keys to happiness, the number and quality of relations to other people, which is tough to maintain as a founder working so hard on a business. Anyway, Peldi, thank you so much for coming on the show.

It's been great hearing your story. Can you tell listeners where they can go to learn more about Balsamiq and the things you're doing in your personal life as well, if you share that kind of stuff online?

Peldi Guilizzoni 43m 58s

Yes. So to learn more about Balsamiq and my history, you should go to Balsamiq.com. It's spelled with a Q instead of a C because we're not vinegar. And then if you go to About Us, there is a Talks & Interviews page where you can watch talks that I've given over the years, since 2010.

I think that those are very useful for other founders. Personal life, I don't share. I'm retreating from social media more and more other than privately sharing to family and things. That's a whole other conversation.

Courtland Allen 44m 40s

Thanks so much for coming on the show, Peldi.

Peldi Guilizzoni 44m 42s

Thank you very much, Courtland.

Courtland Allen 44m 43s

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