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PG: Tell us about your mom.
SL: She was a guiding force, but he didn't realize it right away. She encouraged him by not encouraging him. (Reverse psychology.)
PG: Did you have an offer from Pinterest before you left from college?
SL: He had offers from startups. Maybe Pinterest.
PG; How did you meet Ben from Pinterest?
SL: He'd exchanged some e-mails and was in Berkely for a football game. So they met up. Where he was at nobody used phrases like "VC" and he liked being around people that used the same vocabulary.
PG: Why did you decide to join Pinterest?
SL: 2 things - the product was actually useful and it has a business model. They also actually cared about the product. He left college to see if he liked a startup. He's technically on a leave of absence from USC.
PG: Why did you leave Pinterest?
SL: He wanted to figure out if starting a company on his own was what he wanted to do.
PG: Do you ever think "I left a lot on the table" (leaving Pinterest)?
SL: Yes, I did. But I'm learning and doing things I've never done before. Things you never think about before you have to deal with it.
PG: Tell us about your adviser Shaw.
SL: He grabbed lunch with him to talk about Pinterest.
PG: What did he help you the most with?
SL: Technical abilities for marketing and the press. He can talk to him whenever he wants and he can vent. He's someone he can trust with everything.
PG: Let's talk about Gumroad.
SL: In hindsight it makes more sense. He liked helping people make money and it would be financially sustainable from the get-go. Gumroad is a tool that makes it as easy to sell as it is to share. It's "the lemonade stand of the Internet." Twitter and Facebook are foot traffic on the Internet.
PG: What are the obstacles?
SL: Technical problems like not having direct deposits. He asks people why they aren't using it and then goes backs and fix them. Sometimes they start using it, sometimes they list more problems.
PG: What are you using for discovery, besides press?
SL: He spends most of his time on the product itself. They go after communities. Build microsites and tools. Looking for people that need the product and go after them.
PG: Who are the people that need you?
SL: People with a following (like on YouTube or Twitter), but no way to monetize it. People with a constant content stream.
PG: What was fundraising like?
SL: He was solo until halfway through series A. He start raising money (he jokes) when he started blogging about what he wanted to do... 3 years ago. You have an hour meeting to get funded. That's why VCs like reference checks. The blog was a sort of reference check. Most investors know if the investment will work within a month or two. He was also always meeting people. He e-mailed people he wanted to meet when he moved here and waiting to see who'd meet him. The game of getting investors is a lot like the game of getting users.
PG: While getting the series A, you needed to get a Team together...
SL: It's tough. He was solo for the seed round and made sure people were cool with him building it himself.
PG: How many do you have now?
PG: How did you find them?
SL: A friend and a mutual friend. He just hung out with them. He'd meet them in person for coffee. If they hit an hour and they were running out of things to talk about, it wasn't going to work. Then he'd ask if they wanted to hack for the whole day on Sunday. They have to commit to a Sunday and he could watch them work on the product for 8 hours. He talked to dozens, and he says its self-selecting. It has to be Sunday.
PG: What's shocked you?
SL: Being responsible for every pixel on the site. Constantly not being happy with your own product. There's not point being emotional, since once you're happy, you're on the rollercoaster.
PG: Had any fraud?
SL: Everyone deals with fraud. It happens every day. One day he woke up and it was their highest sales day. One guy was selling a lot. He took a look at it, sure enough -- fraud. It was early on. Fraud isn't an API thing. You constantly have to be thinking about it. He doesn't want his engineers thinking about fraud, so it's his problem to deal with it.
PG: Any investor pressure?
SL: The first time he felt pressure, he realized he had all the money in his bank account and he should probably get a business account. He took the first of the series A money because he was already talking to the investor all the time. He hasn't felt much pressure and he hasn't spent much of the money. He doesn't want investments unless the VC is actually helpful.
PG: Advice for the audience?
SL: Have the hard conversations early on and be upfront with problems. If your mom is happy with what you're doing, you're probably doing the right thing.
Q: When did you start working with computers?
A: 13 was when he started caring about them. When he started making things he could show people. "I can make this and you can't. Awesome." Also being competitive with his brother.
Q: What inspired the name Gumroad?
A: He asked his mom to find domain names. That was one of them. So he bought it. A couple years later he needed a URL and that was one he already had. He just picked Gumroad.
Q: How did you find dealing with lawyers to be?
A: He loves his lawyer. "He prevents me from getting fucked over. Win-win." He wanted to find a lawyer that was friendly and that he could swear in front of. He'll try and grab coffee with them and then ask questions on social time.
Q: What did you take away from Pinterest?
A: The product really does matter. "I've never believed in a product that hasn't worked," though it will eventually happen. The one thing he'll regret if he stopped having fun while following his plan.
Q: How long from knowing he wanted to start his own company to when he did it?
A: He still doesn't know if starting a company is the right thing for him or not. He started the company the day after he had enough free time to start it. Immediately.
Q: What's the future of Gumroad and what will you use your investment money for?
A: The goal is to make selling something as easy as sharing something. For the $8M investment... he's not sure. Probably on human capital or if he gets fraud so bad it all burns.
Aaaaaaand that's a wrap.