Founder’s Dance with George Levin #3

Welcome to Founder’s Dance with George Levin.

Hope you had a productive week and a relaxing weekend! My week was a bit hectic with travel, which often throws off my routine. But running daily helped me stay on track this time and boosted my mood!

Startup Hacks: The Missing Piece

About six months ago, a friend of mine, a seasoned founder, shared his excitement about a new startup idea. He had all the right ingredients for success:

1. Deep Expertise: He was a veteran in the industry with years of experience and an intimate understanding of the market.

2. Perfect Timing: His business concept was timely—it wouldn’t have been feasible two or three years ago.

3. Laser Focus: He targeted a very specific, narrow segment, avoiding the risks of trying to be a jack of all trades.

4. Proven Track Record: He’d already achieved an exit with a similar product.

So, when we caught up recently, I expected him to share great news about his progress. Instead, he surprised me: he had postponed his launch by six months. He was trying to find the missing piece—a growth hack to secure his first users to hit $1M in ARR without spending on marketing. He believed building a product based on future marketing and sales strategies was flawed. First, he argued, you need a channel that offers growth without risk and uncertainty.

He eventually found this channel: a partnership with a big, established company whose users could benefit from his startup. It took six months of searching and negotiating a revenue-sharing deal, but it paid off.

This story highlights a key point: distribution is often overlooked before launching a startup. We founders tend to focus on the product, assuming it will sell itself or delaying marketing and sales until later. My friend took a different approach—he didn't start building until he secured his first distribution channel.

Another compelling story about the power of distribution comes from the founder of RoboForm, my go-to password manager. It’s a highly successful business today, but many years ago, its first breakthrough came from partnering with a browser that had just launched its plugin marketplace. Eager to populate it, the browser promoted RoboForm, catapulting its ARR well past $1M and allowing it to concentrate on refining its product instead of experimenting with costly paid channels.

These examples teach a key lesson for founders: finding the right distribution path isn't something to figure out later—it's essential from the start.

Product Spotlight: RoboForm

Since I mentioned RoboForm earlier, let's dive deeper into why I love this product—aside from my close friend Eugene Okon being a co-founder.

It's not just about securely storing and syncing my passwords across devices. The standout feature is its one-click log in. It automatically opens any website and fills in the username and password—something built-in password managers like Chrome and Keychain don't offer.

Another reason RoboForm impresses me is its longevity. Founded in 1999, it's still thriving today. As a founder, I find it fascinating how they've built such a profitable and successful business in a highly competitive environment.

Founder Friends: A Spotlight on Mostt

Today, I’d like to spotlight a new startup launched by Dmitry Kalichkin, Ksenia Yudina, and Peter Mansfield.

Mostt addresses a pressing issue in today’s U.S. landscape: the soaring cost of raising children and the growing burden of student loans. It’s a challenging topic and one worth exploring further another time. Today’s knowledge workers are more efficient and work harder than those 30-50 years ago, yet they can afford far less. The era when an average job could support a household and provide a good education for 2-3 children is long gone.

Mostt aims to assist parents by helping them invest on behalf of their children, optimize their portfolios, and build sufficient savings to cover educational expenses.

Money Moves: Lessons from a Late Bloomer

I’ve been a slow learner and a late bloomer in finances.

Here are some mistakes I made that you might want to avoid:

Ignoring financial tools like 401(k), Roth IRA, and HSA: As a founder, I wrongly assumed these weren’t relevant to me. I’ve since learned otherwise.

Investing in individual stocks instead of simple ETFs like VTI: A portfolio manager friend once advised me against individual stocks, suggesting I put everything in the S&P 500 after maxing out my retirement accounts. I ignored him, dabbling in stocks with mixed results—some wins, some losses. A financial calculator recently showed me that if I’d followed his advice, my portfolio would be 20-25% higher.

Overpaying taxes: There are many legal ways to reduce your tax bill, like setting up an LLC for consulting work and deducting a portion of your rent. I was so focused on making money that I overlooked these strategies, like catching golden coins with a barrel full of holes.

Culture Corner: Reflecting on Murakami’s Running Philosophy

What I Talk About When I Talk About Running by Haruki Murakami is one of the most comforting books I’ve read lately. It’s a reflective diary where Murakami, a dedicated runner for decades, shares his thoughts on running.

Between the lines, you’ll find parallels to life itself. In classic Japanese style, he delves into deep topics using simple, relatable examples without overcomplicating things.

I’ve had an on-and-off relationship with running, swinging from marathon-level training to skipping it for years. This book reintroduced running to me as a form of meditation, and since reading it, I’ve logged at least 5 km every day for over 40 days. The book also inspired my wife, and we started to run together. Thanks to our friend Vasilisa, who recommended the book.

Life Snippets: Observations from Norway

This week, I spent four days in Norway visiting my brother Gleb. Norway is a unique country, different from Sweden and Denmark. Due to its oil wealth and small population, Norway has become one of the world’s wealthiest nations. The government plays a significant role in the economy, supporting various businesses and keeping people employed, often with little relation to the actual value they create—almost like a modern form of universal income.

Norway’s success isn't just about having oil but smart investments and building a sustainable system. The Norwegian Government Pension Fund is a major investor in global companies like Apple, Microsoft, Google, Amazon, and Tesla.

Even those outside Norway can benefit from its subsidized economy. A direct round trip from New York to Oslo via Norse costs around $400, three times cheaper than similar flights from competitors.

Mind Bender: A New Approach to Productivity

In the past two years, my approach to personal productivity has transformed. I went from being a productivity enthusiast, juggling multiple apps and techniques, to using Apple Notes for to-dos and my calendar for time blocking. Surprisingly, I’ve never felt more efficient.

I realized that productivity isn’t about doing more; it’s about doing the right things. To focus on the right tasks, you need two key elements:

Being very busy creates a natural filter, making it easier to say no to non-essential tasks. I know it sounds counterintuitive, but the less busy I am, the more tempted I am to find ways to improve my productivity.

Be mindful of your energy and work: You can only achieve this when you're at peace with yourself and not constantly rushing. When I’m in a hurry, I become reactive. Instead of focusing on the tasks that will move me forward, I jump to the first thing that comes up just to stay busy.

Here's a meme I put together to illustrate this thought and my recent transition in a funny way.

Wishing you a great week ahead—stay focused, be productive, and take care of your energy!

Speak soon,

George,

September 8, 2024. Brooklyn Heights.