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In this episode of Confessions of a B2B Marketer, I'm joined by David Heinemeier Hansson of 37signals (Makers of Basecamp + HEY). We get David to share their journey bootstrapping a business in the tech industry, debunking a few audience-building myths for marketers, how they overcame Apple’s threat to launch Hey, and how they maximize their profitability by selling a service rather than monetizing their products.

Content marketing is an essential part of any successful digital marketing strategy. It helps to build relationships with customers, increase brand awareness, and drive sales. But in order to be effective, content marketing needs to be done with a long-term mindset. Two companies that have embraced this approach are 37 Signals and Hey.com. Both companies have achieved success by taking a long-term view of their content marketing strategies.

Here are some lessons we can learn from them about the benefits of long-term thinking in content marketing:

Ultimately this leads to more opportunities for sales down the line . So if you want your business’s digital presence & overall success levels grow over time then make sure you take a long-term approach when it comes your company’s content marketing efforts.

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if you have any questions!

Episode transcript

First, have patience. This is not a tactic or a strategy. And this is why I just like the term content marketing so much, because it implies a sense of return on effort that is due to arrive very quickly.

All right, we got a special one for you today. We have David Hanamire Hanson of 37signals, Basecamp and Hey.com. He jumps on. And I think the biggest key thing I took from this episode was the long-term view of creating content that is original, that is maybe a little bit controversial, a little bit different.

But if you do that over the long term, we may come close to building the movement that 37signals have. Let's jump right into that chat now.

David, welcome to the show. Thanks for having me. So first of all, the thing I like the most about you guys, and we're going to dig in like back history, etc. But the first thing I wanted to say is your, I would say, original thinking. There are all these narratives in the world of startups, tech, like business, etc., that you guys just like completely throw out of the window.

So my first question is, where do you think that you and Jason got this kind of original, like, I don't know, completely against, or not completely against, but different way of thinking from?

I think it goes back to how the company was born and the experiences that both Jason and I had just before launching a software company. A lot of it is born out of the dot com boom and bust. Both Jason and I worked in the internet business back in the mid to late 90s.

We saw the run up to the dot com mania, and then we saw the fallout when it all came apart, when all the balloons popped. And I think that really left a deep mark on how we thought about running our own business. And then we were going to go back to first principles on almost anything that we really cared about, and we cared about a lot of it.

So it meant attacking the idea of how to design a business, how to design a company, how to design a culture, how to design products from this first principles thinking. But just because there was a certain playbook out there that you could follow, it didn't mean you should.

In fact, if anything, we became so skeptical of the established playbook after the dot com boom and bust that it almost felt like an obligation to what if the opposite is true?

Look at any approach to building a software business. Like for example, well, the first thing you should do is raise a lot of money.

What if you didn't?

What if you just bootstrapped your way?

We read these ideas or accounts of how much risk the founders were taking.

What if we took nothing?

What if it took no risk at all?

What if we treated our software business as a client next to an existing consulting business such that there were no credit cards to be maxed out, no second mortgages to be had, none of that stuff.

So I think really just that plus looking at why are we running a business in the first place?

Why aren't we just employees at someone else's business?

It's a hassle to run a business. It's a total pain in the somewhere. And a large part of that came from this energy that both Jason and I derive from fierce independence that both of us, I think, made kind of terrible employees. And I think we would also have made kind of terrible founders and entrepreneurs if we had had to answer to a bunch of anticapitalists. That was just not us.

We wouldn't thrive in that environment. We thrive in an environment where we get to do all the things no one would give us permission to do. Like record podcasts and YouTube videos of your pricing discussions. I watched that one earlier today. Yes. And then the other thing, very early on having this insight that we were never going to outspend the competition. We were funding the business out of our own money.

We're funding it out of the revenues of the company. We were never going to have hundreds of millions of dollars to blow on advertisement.

So what were we going to do instead?

What we're going to out teach. We're going to out teach the competition. And that ethos of teaching, of sharing was something that also was part of this foundation cauldron that we were coming out of. So now it's just second nature.

Whenever we have anything, whenever Jason and I have a conversation or have a conversation with someone inside the company, it's like, do you know what?

That's interesting. We should just share it. I love getting behind the scenes peek of someone else's business because usually it's really interesting.

What are the problems that they're wrestling with?

What are the novel solutions that they're considering?

And so often you don't get that at all because people are so afraid of sharing their secret sauce perhaps, or they're afraid of looking foolish if they haven't considered everything that it is not super polished. Jason and I didn't have any of those fears. We were not afraid of looking foolish. We were not afraid of learning in public. And we did not think we had any secret sauce.

We thought we had a voice. We thought we had perspectives. We thought we had all of those things that made us special. But it wasn't that there was some key product insight that if we just kept the secret, we could beat the competition. Or if we kept our technology secret or our ideas about design secret, that we would somehow have the upper hand.

In fact, we believe from the get go that the opposite was true. Kind of like chefs, you pick up a cookbook, a recipe book from a famous chef. No one thinks like, well, that cookbook is going to allow me to open a Gordon Ramsay restaurant right next to Gordon Ramsay and run him out of business.

No, that's just not how it works. You don't just patronize a restaurant because someone is recreating the recipe. So we never had that fear that what made us special was a secret. If we go right back to the start, I know the second thing you did was have the conference about how you were building.

Or maybe that was the third thing, because you had the web agency, 37 signals, build Basecamp and then you had the little conference, the little events about how you built Basecamp. And then obviously from there, there was a number of books. There's the 37 signals website, which is now kind of like a media property in my eyes. I know you love the term content marketing.

So how do each of these content plays, like the conference essentially, content play and the books and 37 signals play into the overall strategy that you guys have?

I loathe the term content marketing because it's so instrumental. It sounds like the reason you share is because you're trying to drive some clicks, is to try to drive a funnel, is to try to do any of those things, which I understand that that is an effective strategy for some people and that's what they follow.

But I cannot say something in my voice that fits inside of that box and feel good about myself.

What I can share is things I truly believe, not something that looks like, oh, what are the keywords we need to rank for?

Let me somehow weave that into a thing.

Again, I understand why these strategies exist. I'm ambivalent at best about them, but that's not what we do. And it's funny you mentioned the conference. There's this workshop called Building a Basecamp that we launched about a year after we had launched Basecamp itself, the product.

And we just thought, do you know what?

That experience was so interesting. It was so novel. We learned so much that I would have loved for someone else to put on Building of X that I could have participated in before we went in with the Basecamp thing.

So I thought, you know what?

We're sitting on some lessons here that are novel. We're trying something here that others could learn from. And I would love to see other businesses follow in these footsteps.

How do you build a sustainable online business back in 2005, I think, was when we launched the Building a Basecamp, long before the term SaaS was even invented or coined, if you will?

So all of these things we thought like, in part, by the way, that workshop had a simpler goal too.

We had, I think, 40 people show up and we charged, I think, $1,000. It was a 40 grand revenue boost for one day's worth of work, if you will. We spent obviously a bit of time preparing the material, but not that much time because this was this other insight we've had from the start.

In the process of building our business and building our products, we create a bunch of byproducts, a bunch of lessons, a bunch of thoughts. And we can either just squander those things and not share them or we can turn them into things like a workshop or a book or a conference talk or a podcast or a blog post or any of these other things that you can do with it.

And you know what, sort of factoring out what is the exact return on that?

Never something we've been interested in doing, which is why I don't like the content marketing box, because it's so tied up into metrics and so tied into working the funnel and all these other mechanics that come with the nitty gritty of marketing for marketing sake.

We more had like, you know what, we hold authentic opinions that a byproduct of those is that they also happen to be sometimes good marketing and sometimes they're like anti-marketing, right?

Like someone will read something that I write or Jason write or we say on a podcast and they go like, I don't like that at all. I don't like them.

And it was also part of it, right?

I think this is the freedom that comes from thinking not in transactional terms, but in terms of teaching terms that, you know what, not everything you say as a teacher is said to make the student as comfortable as possible. Some of the things that are said is to provoke them to plant a seed, to introduce them to a new perspective.

And they may not like that perspective, but at least it'll hopefully lead them to reconsider why they hold the positions that they do and they'll afford it by that. And that'll be a benefit too. So it had all of these things and then what it also had, and I think that's the driving force above all else. We simply enjoy it. I take great pleasure from writing.

I take great pleasure from speaking and teaching about these things that we've learned. And I think that's really the thing that has carried this on for 20 years. Why Jason and I are still doing so much of it ourselves is because it wasn't just this instrumental thing that we would then hand off to someone else who would then do the mechanics of it. We're like, no, no, no.

I mean, there are all this work that has to happen inside of 37 signals, but we really like this part. I'd like to continue to do that.

In fact, it is one of the key reasons I continue to go to work. We're so fortunate that the business quite a long time ago was successful enough that we technically didn't need to do the things anymore. First of all, because we had expert people inside of the organization who could do it.

Second of all, because you run a profitable software company with great margins for 10 plus years and now in our case, 20 plus years.

Like, you know what?

There's a fair bit left over. So you don't need to do the things you're left with.

What do you want to do?

What do I want to do?

What does Jason want to do?

Well, I want to program. I love to program. I want to write. I love to write. I want to teach. I love to teach this stuff. So that's kind of the essence of it. When you borrow all the things away, there's plenty of things I used to do a lot of the books. Now we have very capable finance people who can do that.

Jason used to answer every single customer support email for the first three years of Basecamp's existence. I believe it was at a point answering 160 customer support emails every day. Now some of them were very brief. Some of them were even curt, but he did all that work in the beginning. Now we have this wonderful 20 strong team of customer support and customer success people doing that work.

So there are aspects of the business where like, all right, it's fine to hand that off. Someone else can do it, but not this.

Would you credit yourself and Jason for starting the Bootstrapper movement?

No, because what we've done at best is to repurpose the way virtually every single company in the entire world has been built, just not in tech. It is only in technology, only in software that we stand out at somehow weird.

95% of every other business in the world since the creation of commerce was created this way, was created mostly on either bootstrapping or very few funds that there were not these millions and millions of dollars that got pumped in so early in the life cycle of a new business. So that is a very novel phenomenon that is mostly about tech or tech adjacent things and certainly around software.

So if we did anything novel, it was to highlight the insanity that the basic laws of business also apply to software. They also apply to startups.

And do you know what?

You can actually build a startup following the normal laws of business and be successful, be ambitious, make a change. What we faced early on when we started talking about building a business in this way was always the derision that, well, you're talking about a lifestyle business. First of all, I love that term.

If you're not building a lifestyle, that is a business that is compatible with a lovely lifestyle, what the hell are you doing?

Why would you build any other kind of business?

So I took that as a term of endearment.

Yeah, I'm building a lifestyle business. It also so happens to have millions of people who've used it. It's also so happens to have made, I can't choose the amount of money over this, but it's also a lifestyle business.

Yes, thank you very much. But it was said in a way of derision because somehow the idea of taking profits, for example, was seen as unambitious. That unless you invest everything you make and preferably two, three times more than that back into the business, oh, well, you're just not shooting for the moon. And you're like, well, I like earth.

Can I stay on earth and just run a nice business that makes a great product for happy customers who buy it at a fair price?

And hey, that could work, couldn't it?

Going into back to the movement part, I think I may have the answer to this already, which is to share how you like your original thought, how you truly feel.

But to somebody listening who is trying to get close to the loyalty of audience or like movement behind their product, what advice would you give?

First, have patience. This is not a tactic or strategy. And this is why I just like the term content marketing so much, because it implies a sense of return on effort that is due to arrive very quickly, which the work of audience building is not a fast endeavor.

Now, granted is much faster these days. If you're truly novel and interesting, it goes much quicker. You can actually build an audience fairly rapidly. That's funny, because Jason and I have both been building an audience, say, on Twitter or on our newsletters or in all these other domains for quite a long time. I started in a new realm earlier this year. I joined LinkedIn.

I was probably the last person perhaps in business to join LinkedIn or one of the last after thinking LinkedIn was not something that was relevant for me. I finally signed up, I think in April or something like that. And I started taking it kind of seriously. I started to think like, you know what, I'm going to share the ideas that I think are sort of appropriate for this forum.

I'm going to try to see if I can build an audience here. And I reached 20,000 followers on that platform in about six months or something like that, which is much quicker than the work we used to do. When we launched Basecamp back in 2004, we had 5,000 subscribers on our blog. That's not a lot. By modern standards, it's barely anything.

There are legions of cats on the internet who have more followers than we did when we launched Basecamp back in the day. So it is possible to build an audience more rapidly.

But the question is, do you show up interesting right away?

Most people don't. Most people have to find their voice. And I think this is part of the myth of it that audience building perhaps is only for people who already have the voice. They are very clear on what they want to say or what they stand for or whatever. And I'm like, these things come together. I have not honed our voice, our takes, our principles, our values in five minutes.

It kind of came with the growth of the audience as well. So just taking that patience in and then to some extent also, it's sort of like a paradox here. On the one hand, don't try too hard. I think this comes across sometimes when people are like, all right, I'm going to be a thought leader.

I'm going to put in the things and I'm like, what are the things people are talking about?

And let me take like some position on that that perhaps will fit into something. I think most people can smell that. They can smell when it's inauthentic, when it's forced, when it's too soon. What I've found in following others is that going deep on what you know something about, it's almost always interesting. So you might think like insurance, I don't know a lot about insurance.

And it sounds like something most people would think like, well, that sounds boring. But I've found that virtually everything is interesting if you just dig deeply enough. If you explain the mechanics, if you out teach in an interesting way, and usually it gets interesting just by keep scratching.

Why is that?

What is the historical reason for this?

What is it?

And use your subject matter expertise in a way to become interesting. And in the process, teach your customers perhaps about the products that they're about to buy. There's so many things that I've bought or companies have started to follow because the operators, the owners of the business were really good at explaining the why. And sometimes you see this in sort of adjacent fields.

I think the website Houdinki, which is a watch website, houdinki.com, is really influential in the upswing and popularity of vintage watches and other forms of watches. And they did that by going deep.

I learned so much about watches by following those articles and realizing, oh, do you know what?

Oh, so that's what a mainspring is. I kept hearing that word mainspring.

What's a mainspring?

What's a bridge?

And he's like, you get into it, you get deeper into it, and you start developing a relationship with it. That's the strategy that we've used, for example, around how to run projects. Jason and I have a lot of opinions about how you run projects well, how you communicate well, how you structure yourself well, how you get productivity out of a small team.

Well, it so happens we also sell a product management tool. We sell Basecamp, which is the encapsulation of that, if you allow me wisdom, that we're trying to disseminate. And some people will first, obviously, this is the funnel, if you will, of the content market, they will read something we write about, for example, group chat being stressful and exhausting. And they'd go like, oh, I don't know.

I mean, we're pretty happy with Slack.

What's the problem with that?

And then Jason, for example, he has this wonderful takedown, if you will, where he goes through what are the problems with having a group chat running all day long, decisions made line by line, scrolling away off into the ether. And they might get to the end of it and go like, huh, I hadn't thought about it that way.

Do you know what?

Yeah, I can see that now. I can see yesterday, I missed something and just scrolled away from me. I never got back to it. I never got a chance to give my two cents on it. That's not a great way to make decisions. It's not a great way to work with this constant state of partial attention.

Do you know what?

They might read that, right?

And then six months later, they read something else. Two years later, they read something else. And then three years in, they're like, oh, you know what, we should get that thing.

What's it called?

Oh, Basecamp.

Yeah, let's try Basecamp.

How do you measure that?

How does that fit into a content marketing funnel?

How does it fit into a content marketing timeline?

It does so quite poorly. But that's the reason to do it, not just for the extrinsic rewards of it, but the intrinsic joy of sharing to see a light bulb turn on for someone else. That's a really enjoyable experience.

I mean, I have the greatest respect for teachers who have the patience to especially work with kids because unfortunately I do not. But I recognize those moments, the attraction of that moment of turning on the light bulb inside someone else's head. I think one of the core differences between what you guys do and content marketing is maybe the difference between short-term and long-term thinking.

You guys are happy to throw out everything you know, because you know over a long enough time horizon it's going to come back to you. Whereas if you're a marketing manager and you have a quarter to get the leads, then you're probably going to be trying those tricks.

Would you agree?

Hugely. And I think this is why so much of the math of business can end up being oppressive in ways that lead exactly to that kind of short-term thinking. And this short-term thinking doesn't even really kind of work. And that's what's so depressing about it is the way to build a good business in my optics is actually to focus a little less on the business.

And the sounds counterintuitive, but you can't measure everything. You can't boil everything down to a form of attribution.

Now again, if you're placing targeted ads on Facebook, yeah, you damn well better think that you can somehow measure that because otherwise you're just pouring money into Zuckerberg's pocket and who the hell wants to do that just for the sport of it.

But if you're sharing lessons and principles and observations that you truly believe in, that you authentically think, you know what?

Someone somewhere will be better off if they hear this. If that returns or doesn't return, you've got your return either way. And then the second part is after doing this for 20 years, I have no idea what hits.

So one way for us to find the hits, the thing that really resonates that can turn a light bulb on into the brains of tens of thousands of people or hundreds of thousands of people at the same time is to share everything because we don't have the mechanism to pick up the hits in advance, which I mean, we're not exactly the only business to struggle with this.

If musicians could just know a formula to come up with a hit every time, the business would be easy, wouldn't it?

And you wouldn't have so many bands who just in an entire career of 30 years might have like one, two, three songs, even if they're very well known, that turn into hits. It's difficult to do. But the process is to keep working, to keep playing.

So that's where I think of it in this sense that like, if this has to work, we have to put good things into the universe, have a cosmic faith that it's going to return. It might return a little, it might return a lot. But if you look at the history of what we've done at 37signals, we've been in business for 20 years.

In that period, up until very recently, we had spent less than a million dollars in advertisement. We had no salespeople. We had at any given one time up until very recently, we might have a single person on marketing or no people in marketing explicitly.

But we treated everything we did as marketing in the sense that if you impart good lessons, good perspectives onto people, that is marketing, that is brand building, even if it's not buying an ad, even if it's not getting a placement somewhere. The total sum of what we stand for and how we show up and the product itself, it's marketing. So we took that very seriously.

And that obviously got us here all the way. We are now about 80 people at the company. We've been profitable for 23 years and running, never had a moment where we had to lay off a bunch of people, always lived within our means and made plenty of money doing so.

There was a recent LinkedIn post of yours, I think, showing the layoffs or stock prices of other comparable software companies that have maybe had a looser view of fundraising that I thought was really intelligent. But let's skip over that and move on to Hey.com.

Now talking about good marketing, first question, how important and how hard was it for you to get that domain?

It took Jason three years, I believe, to get it, to find out who owned it, to establish a relationship to that person and work on it over the years. First it also took three years to stomach the price. This is by far the most we've ever spent on anything like that.

In fact, for many years, a chapter in Getting Real, our book about starting Basecamp back from 2006 explicitly say, don't waste your money on a domain, which I think is good advice for most things starting out. This was the exception.

Do you know what?

An email client does need an exceptional domain because it's going to be part of the product that you sell is this great domain. So we thought about it, you know what, we're making an investment.

It's kind of one of those investments where you're like, Jesus, are we really paying that much for a domain?

Unfortunately, I can't disclose that some part of the deal was to not say that. But it was so far beyond.

I mean, we have Basecamp.com too. That wasn't cheap either. Hey was on another level. But we thought, you know what, we're going to go all in here because what we're up against with Hey are by far the longest odds we've ever faced in any venture we've ever taken on. Here we are.

We show up really late, if you will, to a market that has existed for 30 years, a market that for 16 years have been utterly dominated by a single player who gives the product away for free.

I mean, those are some of the longest, most difficult odds you can face in any kind of business. Add to that, that the potential customer base will have ingrained habits built up over perhaps even decades of how to do email.

And we want to introduce something that's not just a competitor, but something that's completely novel, that ships with a foreign workflow that customers have to adapt and they have to unlearn their ingrained habits to be able to embrace. That's really difficult. If we're going to have a snowball's chance in hell of pulling that off, we have to show up on our A game on all of it.

The sign has to be stellar, the domain has to be stellar, our execution has to be stellar, our technical infrastructure has to be stellar. There's a reason why so few email services have popped up. Before we launched, hey, any of the major ones most people would know about, they were all over a decade old.

If you think of Fastmail, or Proton, or Gmail itself, or Outlook, or iCloud, they were all well over a decade old because this has only gotten harder.

In fact, I was happy that we started working on this before I truly realized how difficult it would be.

Because if I had known upfront how difficult it would be to create a reliable email service where email actually arrives on the other side and you always get it and all the mechanics and all the standards and all the other stuff that involves it, I might have gone like, do you know what, Jason?

We should pick something easier. This is just too hard.

I mean, we're already trying to wrestle arm with Google and wrestle away some portion of the monopoly situation they hold, particularly in the US. Something like 80% of all email goes through Gmail in the US, which is just mind-boggling when you consider that everyone uses email, that one company sits so squarely on such a huge market, particularly because email, while it has network effects, does not actually have client networks effects.

For one person to use Gmail, it doesn't really matter if the recipient also uses Gmail. That's one of the magics of email itself, that it's a protocol, it's not a product. That's why we at least even thought it was possible to engage it.

But how do you compete with free?

How do you compete with a good version of free?

I mean, the Gmail that launched in 2004 was legitimately good, awesome even. Our opinion would be that after they secured the monopoly, not a lot happened, so the innovation sort of stopped, or not sort of stopped, it definitely stopped and it stood still. And email as a service got kind of put into the freezer in terms of innovation. So all that was really difficult.

And then we launch and we learn, oh, actually, before we can fight the big boss of Google, we actually have to fight another even bigger boss of Apple, even for the right to exist, which was just this, you're like, are you kidding me?

We've just spent two years building this email service, pouring in millions of dollars, our very best hopes and dreams, blood, sweat and tears, this incredibly expensive, hey.com domain. And now we might not even get the chance to exist because Apple shows up with a baseball bat and says, hey, you better pay 30% of your revenues, or you're not going to be on the app store.

And I just thought like, man, I'm glad this is not our first time at the rodeo. I'm glad I have like 18 years under my belt as a SaaS operator, as a business operator before we take this on. Otherwise I would just have rolled over and said like, you know what, let me just sleep for 100 years. This is too hard.

So I just wanted to share something because talking about being the top of your game for Hey, one thing that definitely is a copywriting on the homepage, this is the sub headline, emails sucked for years, not anymore. We fixed it. Hey's fresh approach transforms email into something you want to use, not something you're forced to deal with. Shout out to the copywriter.

Maybe that was your Jason who wrote that because that is awesome. That's mostly Jason. Jason does most as he says, copywriting is design and he's the head designer. Very nice.

One more point on Hey, I think something is quite interesting based on everything we said before in this interview is that your barrier for success for Hey is like, I don't know, all of the magnitude smaller than those other players, right?

You guys can have, I don't know, X thousands of users and it still is a success for you, I assume. Yes. And that was really the one thing that gave us the gumption to attempt it. Because you go up against somebody like Gmail. I think Gmail has like 1.5 billion users and you think like, we could never be a rounding error in that marketplace. But the wonderful thing is we don't have to.

This is a paid product. Hey is $99 a year. You don't actually need that many customers.

In fact, our original projections were, well, I mean, getting off the ground here, we could just get like 3000 paying customers. That would be a good launch. And bad luck, good luck, we got the world's attention for about a week and a half when Apple assaulted us at the launch. And we ended up signing tens of thousands of paying customers.

And we like had this thing we always tell other entrepreneurs virtually never happened. We had an overnight success. This was by far and away the most successful launch we'd ever done for any product of any kind. And it never happened kind of just sort of out of magic or out of timing luck, bad luck, good luck. It's always you think Apple shows up and threatens to put you out of business.

You go like bad luck. And then you somehow make it through that process and you get a launch campaign worth perhaps $20 million. And you go like, oh, good luck. Maybe. I don't know. I can't tell. But either way, yes, the business of Basecamp was a viable business, was a successful business, completely out the gate, which is quite rare.

But it is also a function of paid products, which is why we're so big fans of paid products. We don't have to monetize. I also another word I hate monetize. Whenever I hear the word monetize, I know something sleazy is going on. I know some roundabout way something is being sold behind my back to pay for the things that I'm doing monetize. We don't monetize anything. We sell you a service.

You pay us $99. That's the transaction. That's it. The same thing with Basecamp. We sell you Basecamp. That's it. There's no more magic to it, which is actually one of the reasons why even when we were doing tens of millions of dollars in revenue, we had essentially the accounting model of an ice cream store, because it was just so simple. It was just credit cards.

They were just getting billed and the money was getting dumped into our account once a day and that was it.

I mean, I am glad we now actually have people who know a little bit more about finance, and it was remarkable how many hundreds of millions of dollars we could process in revenues over many years running it basically like an ice cream stand. But that's the luxurious nature of a simple business.

Now this also comes back to that comparison you were talking about earlier where Basecamp for many years did not have a lot of competition. Basecamp today has a lot of competition. And that competition is configured in very similar ways.

In fact, they all follow the same venture capital backed enterprise sales cycle. Small businesses are a stepping stone and then you can land a huge whale accounts and then that's how you find yourself. So you end up with really large businesses, even though they have roughly the same number of customers that we do.

Some of those customers are larger, yes, but the difference in the complexity of the organization is just truly staggering. I remember when Jason looked up those numbers and some of these competitors we have would have like 1600 employees, 3000 employees, 2000 employees, and they'd have the same number of customers that we do.

Again, they're not completely the same business. You can't compare them even Steven.

But you know what?

We exist in the same realm, right?

We have 80 people. That's it. And with those 80 people, not only do we do Basecamp, we also do Hay and we also do all this teaching. We produce Ruby on Rails, we write books, we do our part. All of these things happen and they don't happen because Jason and I work 200 hours a week. They just don't.

Some of these things happen because of the fundamental simplifications of choosing to run your business in a different way, like not having an enterprise cycle, simply having a basic price. People can sign up on their own and we can sign up. I think last week we signed up 3000 and 4000 new businesses for Basecamp.

They're not all going to come in as customers, but we couldn't have the organization we do Basecamp wasn't exceptionally easy to onboard with, to try out, that it didn't require hand holding of a salesperson. It didn't require an account manager to close some huge invoice. Those things are not compatible, but that's the differences.

And I had actually pointed out before we even got into our direct competition, one of the or some of my most favorite business stories is to look at the head counts of some of these businesses that are sold, like WhatsApp. I think we're 50 people when they were sold for $19 billion to Facebook and not so much the sales price, although that is remarkable.

Perhaps that's the best ratio of head count to acquisition cost in the history of software, but also that with 50 people, they were serving something like, what was it?

500 million people or something like that. And you think of those things and you think like, yeah, this notion that there's this linear relationship with, if you have more employees, you can do more things. It's just not true in software. This is why software is so magical and interesting and remarkable to work with. Nice. You mentioned earlier your ideal or the three things you love to do is code, write and teach.

How close is your day to that?

It's quite close. It's really close. All the good days are close. Not every day you get to do your favorite things all the time. And we occasionally have other things that pop up, but I do spend the majority of my time either teaching, writing or programming. Some of the time is also spend some coordination and so forth.

And we have more coordination now where we're 80 people than we did when we were 40, which is also one of the reasons why whenever I hear a small business be like, oh, I wish I had more customers, I wish I was big.

It's like, hey, slow down, slow down, slow down. Embrace what you have, cherish what you have. It will never be easier than where you are right now. You will never have more time to focus on the things you really want. Once your organization grows, and we're of course still like a tiny organization, I think of 80 people, this huge organization.

But as I talked about, most of our competitors have well past a thousand, if not several thousand employees, which just blows my mind. But spending my time way where I really want to go to work is just crucial. Because again, we don't have investors forcing us to go to work. We've made the money we needed to make, if you will.

Jason and I have to find the intrinsic enjoyment in the work to continue to do it. So designing our time, making sure that I have long stretches of uninterrupted time when I can really crack the knot on interesting intellectual problems, business problems, programming problems, writing problems. That's the game.

That's the essence, which is also why when people ask me, as they sometimes do, what's next?

I'm like, dude, I found it.

What do you mean what's next?

This patch of green space right here, it's wonderful. I don't know what's on the other side of that hill. I'm not even particularly inclined to find out. We have such a, again, I think propaganda station build up that the highest form of accomplishment for an entrepreneur is to do it again, is to do it again and again and again and again.

You know what?

That works for some people. There are some people who will start a business and they'll realize, you know what, rather than figuring out how to send money around the world without fraud, I want to shoot rockets to Mars. Awesome. I'm glad that those people exist in this world. Those people are not me.

And I am really comfortable with the idea that, hey, do you know what?

37signals is great. It might be the last company I ever worked with. It might be the only company I've ever sort of worked at for a long time. That's fine. My LinkedIn profile, we talked about LinkedIn, has one entry.

37signals, 21 and a half years.

Okay, David, I want to be respectful of your time. I want to say the thing I like the most about you guys is, and I don't want to say the word, but the, I'm not going to say the word, but the information that you produce, the quality of it and the consistency of it and the originality of it.

And so that's benefited me significantly, but then also how you've leveraged that to get more attention ultimately, not that it was the ultimate goal for the product SpaceCamp and Hey, and I think that's absolutely incredible. So I know you hate the term, but arguably one of the world's best content marketers here right now.

We can obviously link to Hey below, we'll link to Basecamp below, we'll link to your LinkedIn so we can pick up some potential new followers.

Anything else we should tell people about?

DHH.dk, if you just remember one domain, has links to everything that I do, including our books. We've written about four of them, the latest being, It Doesn't Have to Be Crazy at Work from a few years ago. And Remote Office Not Required from 2013, about seven years before the rest of the world discovered that, hey, remote might work.

David, thanks so much for your time. Thanks for having me. And thank you so much for listening to this episode of Confessions of a B2B Marketer. Thank you so much to David for coming on and sharing his wisdom. All the links will be below in the show notes.

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And then of course, if you have any feedback on the show, please go to Apple Podcasts, leave a rating and review and I will get to you a shout out on the show if you send me a screenshot of that review, either to Tom at fame.so or to me in a DM on LinkedIn. And of course, thank you so much for listening.