Ryan Rutan: Welcome back to another episode of the startup therapy podcast. This is Ryan Rutan joined as ever by Wil Schroder, my partner friend and founder of startups dot com. Well we live in a world where we funk up as often as we don't right? I mean we talked about this all the time, right? This is this, we were running into the abyss naked as you like to say. I usually prefer to put on at least a hat, but we are always making mistakes. And yet there's this thing within founder culture where we have a hard time admitting when we've made a mistake and often it doesn't come at the right time or in the right way and this can have all kinds of impacts on the organization. So why don't we uh, we beat that up a little bit today. Let's talk about when we fucked up.

Wil Schroter: Yeah. Where do we begin? We can start with any chapter. I

Ryan Rutan: feel like I should unroll like this giant parchment sheet at this point parchment. Look

Wil Schroter: here, here's where I think it's a big, big problem. First off, we're going to mess up all the time. I mean as founders, that's fundamentally what we're going to do

Ryan Rutan: that. Nobody

Wil Schroter: really tells you what the cost is. I mean, if we really call it what it is, what the cost is of not admitting when you messed up. Nobody loves to do that. And I think in all our relationships in all the experiences that we have. We're typically used to defending our mistakes, right? You know if we're tardy to class, we have to defend that with an excuse right to soften the blow, have a relationship where there's an issue, we have to defend our position, right? And we're constantly feeling like if we don't defend why we were right, that for some reason, you know, we we failed, this is this is the opposite, this is the one situation where if we can't not only admit that we messed up but explain how we messed up and get people comfortable with the fact that we messed up, you know, and kind of exposing some vulnerability. This creates a mountain of problems as we go forward, right? And I think it's multiplied. It's compounded geometrically by the fact for the first time in many of our lives as founders as leaders. Our lack of vulnerability actually has a powerful effect on all these other people. Before we get into this next topic. I just want to let you know what we talk about here is like 1% of the conversation, you know, really, this conversation is going on all day long online at groups dot startups dot com where Ryan and I pretty much talk endlessly with founders about every one of these topics. So if by the end of this discussion, you like the topic and you want to dig into it a little bit more with Ryan and I just had two groups startups dot com and we'll pick it up from there, Ryan. If you and I look at our organization, we've got 200 people that we care about, if we bottle it all up, you know, if we show that we've got this Impenetrable shell and we can do no wrong and all we do is defend our position. We affect the personalities of 200 people, right? And that's not okay. So I think at its court today, we should talk just a little bit about what are all the impacts. You know, what are some experiences we've had where when you harden that shell, when you bottle it up, it works against you on the flip side, like when we actually have an opportunity to open up and to become more more vulnerable to explain ourselves. Well, how many things that buys you within the organization, You know what I mean?

Ryan Rutan: 100%. Yeah. And I think that I think vulnerability is going to be key to this and we've we've done an entire episode on that, but we're going to bring that back around today because I think in the context of of when, how and why we admit that we've made mistakes. The vulnerability piece is really important. I'll circle back on something you just said which is that we're impacting 200 other people at this point with these decisions and it's it's not just around like the mistake, right? Yes, that happens that has impact and we're gonna go through some some anecdotes and stories today and explain where we've done this and what happened. But I think generally speaking just as a behavior, you're starting to teach the organization that we need to maintain the shields. We need to maintain defensive stance. And that makes it really hard to work with people, right? It makes it really hard to work with people. You end up with this entire organization of people who now isolated themselves from each other. Information is getting shared things get bottled up and then you either get toxicity which can kind of spread slow or fast, but it's more of an organic spread or you get these like explosive moments where when things get pent up that really bad shit can happen simply by not having admitted that something was wrong or just by creating a serial environment of saying, we just don't admit when things are wrong. We don't admit mistakes and and we don't talk about them. We just stuff that deep down and keep it hidden. And uh, as as you said, that can have all kinds of deleterious effects on the organization.

Wil Schroter: I think this past year, you know, we're in 2021 when we're recording this. So the past year in 2020, in the US specifically, you had just a firebomb of emotional unrest right? At every possible level. We had massive civil unrest. We had a Covid, we had all of these things all happening at the same time if you were ever tested as a founder and a Ceo or a managing team of a startup 2020 was the crucible of of all crucibles, right?

Ryan Rutan: Yeah, It was the ultra marathon of chances to funk up, right? Like,

Wil Schroter: oh my God, even if you did everything right, the whole world was wrong, right? And I think one of the things that that we learned, I think within our organization, you know, startups was that the longer we wait to admit we did something wrong or the the longer we wait to respond when, you know something's going wrong, the worse it gets right. I mean, it's just exponentially and it's almost like it gets geometrically worse by the moment, You know what I mean?

Ryan Rutan: It does, it does in this case and I know we're headed with this in this case. Those two things were inextricably linked, right? It was how long we we waited to respond and the fact that, you know, we we needed to respond in the first place, right? So the first mistake was, was in not responding. And then the second was that we waited, Right? So those two things were compounded against each other and it got tense pretty quick.

Wil Schroter: It did, I think for us, we were responding to so many things at the same time that I don't think we did a great job in the early stages, right? Especially when Covid hit Initially, we had a game plan that said, here's as an organization, how we're gonna get through this. But I don't think we were as cognizant as we could have been about how it was affecting everybody on staff, right. You know, we were so worried, sort of how we should be about making sure people stayed employed, that we kind of overlooked things like, hey, you don't have childcare now, right? Or hey, you're working from home and your home situation isn't very workable. I mean, you name it. I like, it just battered everybody at the same time.

Ryan Rutan: Yeah. And it's not that we weren't thinking about things, right. It's just that we, we didn't consider broadly enough. And even where we had considered and thought about some of these things, we didn't directly address them, right? And I think that was, you know, a big part of it now. I am very proud of the plan that we put together. I'm even more proud of the fact that it worked. And, and then we did kind of keep things whole And that felt great. But to your point, there was this entire layer that we forgot about which was, Yes, we've addressed the company issues and yes, we've addressed how these will impact you directly personally. Company to human. But we forgot there's a whole other 80% of that human that exists outside of our organization and we did not directly address a lot of those needs sadly, until they were, you know, kind of brought up to us. We don't ignore them, right? We responded, but we, we could have been far more proactive. Um, and, and a bit more thoughtful in terms of that, and gave us gave us a, it was a good learning moment, right? We talked about having experienced things like this before, right? You've, you've told a couple stories about having, you know, been through this rodeo before, something like Covid and we've been through financial crisis more than once. Um, you know, went through 99, 11. Um, there were a lot of things that, you know, we've seen through our careers that had impacts like this. I think that what we Misgauged in this case was just how severe and how much more this impacted everyone's lives, right? That this, this wasn't something that was like, well, this is probably gonna impact 20-30% of the staff. This, this impacted 100% of the staff and 100% of the people that they knew. And that was the part where I think we should have leaned back a little bit more and gone, okay. But it was a great learning moment for us. You know, the initial response wasn't great, but we came back with some contrition. You know, we apologize for not addressing those things. We admitted that we funked up quite openly and quite readily and that helped a lot, right? It doesn't fix the mistake, but as you said earlier, it gives them some understanding of how we got to the mistake. Like why did we make the mistake? We were so wholly focused on making sure that everybody maintained their job, that we were treating that as the most important thing in their lives. And it turned out that for some folks like, yeah, maintaining their job is really important, but like maintaining their sanity and a home situation that's just completely turned on its head might have been more important in that moment and we completely missed that.

Wil Schroter: Yeah, I agree. And I think that was the preamble to what would happen shortly thereafter uh in the US particularly around the George Floyd incident where the whole country, the whole, I mean the world, but you know, it's certainly in the US just when atomic with good reason. And that's where if we missed on Covid, we definitely missed at that moment. And I'm sad to say that, but you know, it's let's unpack that one, You know, let's talk about this under the guise of the longer we wait, the worse it gets. Yeah, I think the two

Ryan Rutan: are a nice contrast. Right? The two are a nice contrast because while we had a response for Covid, it may not have been optimal in the early days of, you know, when, when the social unrest really burst open. We essentially had no response. So yeah, diggin.

Wil Schroter: Yeah. So, so that was 100 times worse. So, you know, to set the scene. So the George Floyd death happens and the world's on fire and the world was already pretty on fire to begin with. But this was just so much worse and it unleashed so much emotion. And here's what was interesting at the time, I don't know if a lot of folks picked up on this. It was one of the first times, let's say in my career, where An organization's response was tantamount to a personal response whereby like 20 years ago, around the time we had like Rodney King, uh 30 years Jesus, you know, there was an intense amount of unrest, but organizations in the corporate level were pretty quiet. This was the first time where every organization thankfully came full force. Like this is how we feel about this, right? And so you had major companies and brands and you know, again, I'm going beyond just the scope of individuals saying this isn't okay, here's how we're going to fight against it, et cetera. And within our organization, people were piste, you know, at so many levels and they were fired up and they were looking to us in what our response was, you know, as the management team, leadership team, et cetera. And we didn't have a good response. In fact, we had no response. That was really the issue. It was, it wasn't just, I want to unpack this one a bit because it's really important, I think this is such a good example of where we messed up royally. And then when I say why I don't want to defend it because there's nothing to defend, right? Like we just messed up. But I want to go about kind of how we responded to it internally to get a better feel for kind of why that was the wrong move, but more so how we responded and why that was maybe the right response. So days, weeks go by way too long for us to not make a response. And the organization is just by the minute heating up, right? It was it was getting pretty intense and you know, within slack groups and private conversations, people are just like what the funk man, Like why are we responding to this? Why

Ryan Rutan: is there no open discussion about this?

Wil Schroter: Why is there an open discussion about this? And and and folks in our slack channels, like in our group channels etcetera, we're talking about it, right? No question how could you not? And and they were sharing and supporting each other and it's awesome. But we were as, as an organization as startups dot com. And what's interesting about that, I'm just gonna, I'll speak for myself in this case, there wasn't any lack of response, right? My head was exploding, but I didn't know how I was supposed to respond to the organization with what was in my mind in retrospect, it seems so obvious. But at the time I was I was honestly kind of confused.

Ryan Rutan: Go back to what you said a few minutes ago, which was that, you know, it was the first time where we were involved in a situation where an organizational response to something like this. It was sort of expected, right? That we've gone through these things before because we were all individually having responses and taking actions, right? You me, the rest of leadership team, we were taking actions individually, right? But as individuals. But what we didn't do was come together and say collectively here is how startups dot com is going to address this here. The things here, here's how we're feeling, here's here's why we're mad. Here's where you can go and express that. Here's where we're expressing that. You know, I was picking up the phone and making a hell of a lot of phone calls in those days, um, checking in on people that I cared about individually, right? And within the company without and outside the company. But that lack of a central response left people feeling really adrift within the organization. And that was not okay.

Wil Schroter: Right? And so here's what ends up happening by the minute. This thing is just it's just exploding, right? And at that, at that, at that moment, people are just at wit's end. And so finally we sat down, we wrote something to the entire organization, Mind you were across tons of time zones, et cetera. And so we want to make sure everything got something at once and got something that was really how we felt, but more importantly, why it happened. Why was there a lack of response? Right? Because I think there's two paths here and I think it's very important to distinguish one path is an excuse. An excuse has a defensive quality to it, right? Ryan, you're late to class. Ryan is going to provide an excuse which tries to defend his position of why he's late to class. The other side is an explanation. I think that's the part we want to talk about. An explanation doesn't try to defend your position. It just explains how you got there, right. What we needed was an explanation. Our, our team, our folks, everybody around us, their families, etcetera. They need an explanation of how we felt, why we felt why we made the decisions or lack thereof in a very deliberate way. And so we wrote something to the organization that was very heartfelt. It was probably one of the hardest emails I've ever written in my life. The hardest things I've ever written in my life. Because I opened up about a lot of things that I've never shared before publicly about the emotions I was having, where they came from, whole childhood things. I mean, you name it and why it kind of shook me for a minute and prevented the right response, here's what we didn't do, we didn't say. And this is why we were justified in doing what we were doing, we just laid it out. We funked up like, here's what we should have done, here's what we didn't do and we messed up, right? No questions asked. You know, by the way, I just want to mention if what we're talking about today sounds like the kind of discussion you wish you were having more often, you actually can, you know, we're online all day every day, working through exactly these types of topics with founders, just like you. So any question you would have, or maybe some problem you just want to work through. We're here and we love this stuff and we're easy to find, you know, head over to groups dot startups dot com. And let's just start talking. And I think this is important in any relationship in communication, here's why we did it right? Here's, here's the information we had. And again, I'm trying to make this a little more generic, that applies to a lot of situations. Here's the information we had at the time. Here's how we're processing it, here's kind of the thought process we're going through, right? You know, kind of making a decision and here's where we landed and it was a mistake. But at least you understand how we got there. It doesn't make it right? I think folks are are do an understanding of why we got to where we got, you know what I mean?

Ryan Rutan: Sure being able to unpack the machine that produced the result rather than just looking at the result is really important. It was cathartic for us and it was valuable learning experience for us to understand how we avoid that again in the future, right? So when what were the signals that we should have looked at to know that we should have had a response sooner? How could we have hastened our own internal processing, Right? Because that could have easily become an excuse, right? It was like look we're reeling right along the rest of you. And so like we didn't know what to do, right? However, that's not okay, right? I think this is one of those moments where it you know, it's often obvious that what leaders get to do versus what everyone else gets to do is very different, very different level of expectation. And I think that we got caught

Wil Schroter: just

Ryan Rutan: being people in the moment and again, not by way of excuse just by way of explanation. We got caught just being people trying to process for ourselves and instead of remembering we're leadership. We don't get any small amount. I can't even use the word luxury here because nobody had a luxury to process any of this. There was no luxury, no luxuriating going on in processing what was happening in the U. S. At that time. But we didn't have even the the option of of waiting right? There wasn't time to fully process. We needed to respond as well as we could as early as we could? And you know while I think we responded, well it certainly was not as early as it needed to be.

Wil Schroter: You know, and what was interesting is when we provided that it was a long explanation when we provided the explanation. Uh we had a lot of responses and you know some some pretty intense responses and uh they were generally favorable and again I'm okay if they're not favorable. I just want to provide the information whether whether you're happy about it or not. Right? I mean you deserve the answer but in all of that both the favorable and unfavorable responses was thank you for being honest right? At its core. Yes you were wrong. But thank you for being honest. Thank you for sharing how you got here so that we can see what's behind it to understand why you made a mistake. You know what I mean?

Ryan Rutan: Right? Yeah. I've definitely gotten them in the past right? Where and and you know it's it's the funk you but thank you email. Right? And or or response was necessarily emails, right? And and and that's okay. And I think there's a really important point there when we choose to admit that we've we've made a mistake as leadership. We have to take the consideration of the response into account but not in the sense that we try to make it as low impact to us as possible, right? The response from leadership cannot be okay. How do we how do we minimize this? How do we make sure that we get as few fucking responses as possible? How do we, you know, without sugar coating anything, but like, you know, how do we kind of, you know, spin this, bend this, defend ourselves a little bit, that has to be taken off the table completely, right? It has to be has to be pure, it has to be honest, has to be vulnerable and you have to be willing to accept the circumstances and the outcomes, whatever they may be, right? I think the minute you start to think about what are people's response to this going to be, you've you've already lost the plot and you're not going to do as good a job as you should in crafting that in the first place. And so I think it's really important to remember why we're doing this right, We're not doing this to show contrition, for the sake of contrition, we're not doing this just to show a look, See I'm cool, I'll admit that I funked up, we're doing this to have an impact, a positive impact or at least open the gates for for communication for all the people who we've created a problem for by not communicating in the first place, I think it's super important to remember that.

Wil Schroter: I also think that, you know, that was one instance, but I think if we zoom out, we have practiced a lot of value and vulnerability, right? Whereby you said, look, if we're not vulnerable and be able to admit that that we we mess something up, then no one else will be. And here's where that

Ryan Rutan: really,

Wil Schroter: really starts to become a problem. The first place it becomes a problem is that if we clam up, we set the tone that everyone else needs to clam up to right, huge problem. So if I can admit I'm wrong and no one else can admit they're wrong. Think of how powerful that dynamic is not in a good way, Right? And so

Ryan Rutan: so

Wil Schroter: the dev team doesn't want to share what they're doing. The marketing team doesn't want to share what they're doing, no one wants to admit right, that maybe something is late or maybe something isn't working or you know, maybe they hired the wrong person, you name it. And that whole tone get set by leadership, right? Leadership can't admit they're wrong. How can anyone else? Conversely, this is the opposite?

Ryan Rutan: Well, that's that's a great point because we have far more defense in the situation than they do, right? It's like, well I funked up, but I'm the founder, so I'm not going to fire myself, right? Whereas if you if you create this image and that may not even be the case and I think this is this is true in in most situations that I've had the ability to kind of look in from the outside and see when I talked to founders, it wasn't that they were creating this defensive stance because they didn't want anybody to mess up or that they would have severe consequences if they did. They just didn't realize the damage they were doing by not being vulnerable, not showing people. It was okay to make mistakes and and and put their necks out a little bit and take some risks right now. Certainly you want to put some rails on that. You don't want to just be the type of organization where it's like, you know, just guns blazing all the time, just do whatever you want. And if you look up, we'll figure it out. I mean, yeah, there is, there are times where that's important, but I think there's also, you know, we can make mistakes, but like let's do it under control, let's admit when we make them, let's unpack why they happen. Let's try to avoid them and all that stuff. So I'm also not suggesting it's just like, you know, let people feel free to do whatever the hell they want and to make as many mistakes as they need to. But you do have to understand that you you said it, there's a there's a big difference in the power dynamic there. And so if they see zero vulnerability from leadership, the chances that they're going to exhibit any are infinite asthma, because how could they possibly?

Wil Schroter: I mean, I mean really if I sit down with somebody and they've made some colossal mistake, the first thing I want to do is relate to it. Hey, I've made the same mistake to write when you talk to your kids and I'm not, I'm not making the analogy of, of talking to team members the same as talking your kids, but but but there's an emotional connection to be had in both cases, when my kids make a mistake, I try to relate it to that. I've made the mistake to has nothing to do with them being kids. I'm trying to relate to them as a human. I want them to be comfortable in knowing that their mistake isn't an isolated event that only they can make. Uh and and again, and and I'm, you know, faultless, I want them to understand that, that we're both, you know, faulty in some way and this just happens to be your version of it. I mean, you just described

Ryan Rutan: our podcast, will you just you just described the entire podcast, I mean, how often do we get that feedback that comes back that says, you know, thank you guys for being open, honest and vulnerable about, you know, your own lessons in this entrepreneur journey. It made me feel better to know that I am not the only one who's made this mistake, right? It goes back to like, yeah, we're all human, Um we're all founders. We're all gonna funk up in a lot of the same ways. It's okay.

Wil Schroter: Stick with that a little bit because part of what you're talking about is validation, right? If I can't validate the fact that that I make mistakes, well then who the hell is going to validate the fact that they make mistakes? And if you've got a bunch of people dealing with massive amounts of lack of validation that doesn't end well. Now again, this isn't the same as as what you were saying earlier as everybody gets to get out of jail free card for doing things wrong again, it's a better mechanism to talk about when we do things wrong, how we talk about it. We do something wrong. If we provide excuses, that's defensive that leads nowhere and it poisons the organization. It actually makes all of our comms worse if we give an explanation. So somebody misses a deadline, you say, hey, can you, can you walk me through why you missed it again? This isn't so you can be more persecuted. Help me understand what broke so we can go fix it. Make sure that doesn't happen again. You know if it's the worst case scenario, hey, I just slept too long and I didn't get to it. Okay, well, you know, we're gonna have to address that one a bit differently, but more often than not when we give people the opportunity to be vulnerable and talk and give an explanation of what actually happened. We start to find out all the stuff that we need to be working on behind the scenes, right? I didn't get it because this person didn't get the hand off in time. Okay, Let's talk to them. I didn't get it because we actually don't get the information from the systems that that we delve into and they're a little bit broken. Oh sh it okay, let's dig into that. You know what I mean? Like if everybody's not worried about defending themselves, you can actually have some productive and useful conversations. It's a very different dynamic that starts with us.

Ryan Rutan: Yeah, I mean, so essentially we're talking about here is like it's it's okay to be wrong, right? We can't expect an organization like jump in here and say like, right, everything is gonna be perfect because we know that's not the case. Like most things are going to be broken. It's a startup. It's just what it looks like. So without that vulnerability, without that openness, it's gonna be hard to see what's broken. It's going to be impossible to address it. And so we have to start from that point, we have to admit that it's it's not just okay to be wrong. It's part and parcel with with with the job. It's part of the territory we are going to be wrong more often than we are right in all likelihood and that's okay. And again, it's the vulnerability to admit that so that we can address that move forward with positivity and with some plan for how to address those things. We're okay at that point right there. But again, going back, the minute we throw up those defensive shields, we take away people's ability to vulnerable, take away people's ability to communicate. We're blasting holes in the bottom of our own boat for no reason whatsoever. It buys you nothing. That's the other thing we didn't really talk about is that this idea of the lack of vulnerability and I do want to move on from that, but we didn't really talk about that trying to put up this fake shield that everything is okay buys you. Nothing right vulnerability comes with issues for sure. But it also comes with benefits. The opposite of that comes with nothing. It buys you nothing. It never will. Right. Okay. So that said moving on, it's okay to be wrong guys.

Wil Schroter: How can you not be? I mean, Ryan, seriously, like given what we do for a living. I see this particularly with the other new founders or people just coming out of state college. This is such a good example. We got something that just came out of college, they come into the organization and they're terrified because they don't know what they're doing and I'm kind of like how could you, you just got here five minutes ago

Ryan Rutan: also think about the environment they just came out of because this is super important. The environment that came out of was literally based on objective testing where the more right you were, the better you were and, and, and if you did get something wrong, you could try to defend it and gain some more points, right? So they were literally taught the opposite of the mentality that you need to be successful and sane and survive and start

Wil Schroter: And, and none of that breeds. It's okay that I messed up. Right. If my daughter comes home with the report card and on her latest test, she got four out of 10, right? There's no version where she goes, Okay. That wasn't too bad. Right? It's so binary, right? We're so conditioned to have this binary response. And so fundamentally we're not built to have and it's okay to be wrong mentality right? That's what I'm saying specifically when folks are either the first and most things in life kind of have a more binary outcome. We're in a world where there aren't a lot of binary outcomes later on they are. But initially it's like, Hey, we've got 10 places. We can, we can do marketing, let's bet on some of them, we need one of them to be right. Even though the other nine will fundamentally be wrong. Let's make 10 changes to a landing page. Maybe one of two of those changes will prove out The other eight will be wrong In any other scenario and any other walk of life making all those mistakes would be catastrophic. A doctor going in. It's like, well, you know, I'm gonna make 10 cuts and I'm hoping like two of them are right. The other eight are

Ryan Rutan: gonna, that's gonna be a bit of a

Wil Schroter: problem, right? Like it's so antithetical to how people would normally think. And so what we're trying to do is we're trying to create a culture and it takes time for people to, you know, to get that when they get here at startups dot com. We're trying to create a culture where people can start to say, oh wait, I'm going to be wrong. Kind of no way around it. And it's okay now, don't get me wrong. That's not the same as tentative. 10 are wrong all the time. Like dude, at some point, you got to get something right to

Ryan Rutan: at some point you were in a guessing game

Wil Schroter: were fundamentally in a guessing game where everything is new, Everything we're trying for the first time we can have experience where we have better guesses, but they're still guesses. And so we're gonna be wrong a lot. Now you bubble that all the way to the top right, You bubble all the guesses that are going to be made across every division right in tech and marketing and ops and everything else like that, hiring decisions etcetera. And then you multiply how many of those decisions are going to map back to you as leadership? If you can't get good at admitting you're wrong, this is going to be a long, long, long journey and it's really not an upside for anybody. Let's actually keep this conversation going. You've heard what we think about this, but you know, Ryan and I would really like to hear what you think and we're online, like all day long, pretty much talking about every startup topic you could think of from fundraising, the customer acquisition to just really have to get all of this crazy startup stuff out of your head. And there's tons of other founders just like you they're weighing in on these topics so you'll get a chance to just hang out and meet some really smart founders were also super, super easy to find. You head over to groups dot startups dot com and let Ryan and I hear what's on your mind, let's get to know each other a little bit and let's just start having more of these conversations