We sit down with Austin Rief, the COO of the wildly popular Marketing Brew.
In this episode, we talk to Austin Rief, the COO of Morning Brew, a daily email that makes reading the news actually enjoyable.
In this chat, we talk to Austin about how Morning Brew got started and its humble beginnings, from a pdf file with a watermarked logo to now having over 2 Million subscribers.
Austin also gives his insight into the now-famous advice "every company is a media company" and what that really means for brands and how to be successful at it.
We even asked him if we fast forward ten years, what do you think morning brew will look like?
"Let's call it a lifestyle company, where we represent the lifestyle of young business professionals. We make them smarter it's our job. We help them invest their money and help them save their money. We help them make all the big decisions in their lives. We make them better professionals. I think that comes in the way of content and education. It probably comes in the way of subscription and community, and you know, commerce. So they'll probably be 8 to 10 revenue streams of different things that, you know, we can engage these people with." - Austin Rief
Phil 00:01
Welcome to the DTC Growth Show. Hey, everyone. Welcome back. First chalk talk in the New Year sitting down here with Austin, which I am super excited to be chatting with today. Hey, Austin, how's it going?
Austin Rief 00:14
Good. How's it going? Pretty good. Pretty good. Thanks for taking the time.
Phil 00:19
For sure. Happy to Love it. Love it. So we got about 45 minutes today, we got the first chalk talk of the year, which I'm really excited to be back. Welcome everyone who's rolling in, Austin needs no introduction. He's the co founder and COO of morning brew. You know, we've seen morning brew grow from humble beginnings to probably one of the most important media publications of today. And I'm stoked to be sitting here and chatting with Austin to learn more about how he built this and, and beyond. So welcome, I can jump right in.
Austin Rief 00:50
Cool, let's do it.
Phil 00:51
Love it. Maybe before we talk a bit about morning brew. I kind of just want to learn about who you are. I think sometimes that stuff gets missed in this in these founding stories and these growth stories, you know, what was life like before morning brew?
Austin Rief 01:04
Yeah, so I went to University of Michigan, very much was interested in finance, it was a little bit of a herd mentality in Michigan, everyone in the business school, wants to work in investment banking, and finance. And I very much followed their herd, and did the very rigorous studying to get a job or try to get an internship or interviews and had all these banks. And, you know, fortunately, during my sophomore year, I met this guy, Alex Lieberman, who was writing this, it wasn't even a newsletter, it was a PDF attachment. And we we connected there, and we ended up launching a morning brew. And it was a really tough decision for me, because I went I interned at Molex, which is a boutique investment bank in New York City. And I do love finance. I just didn't love investment banking, for lots of reasons, which I can speak to, if anyone's interested. But, you know, it was I gave up some security in terms of a job in banking, and we had this belief and, you know, in hindsight, the traction, we thought we had probably wasn't as great as it was. And but, you know, we took that leap of faith. And, and we got pretty fortunate because this one I talk a lot about, but, you know, it was, one of the reasons we got so lucky was because of just timing. And when we raised capital, how much we raise, which again, is I can talk about later, but a lot of the morning, Bruce story, and my story is just about luck and timing, which I think is so much of so many different, you know, business ventures, you know, you can, you can make your own luck, but you can take advantage of luck, but you can't make your own luck. So that's me, love it. Let's just jump into that thought you shared around kind of how you loved finance, but you didn't love investment banking, why not? Yeah, so finance is really cool to think about, you know, how companies, you know, finance themselves and how they fund the operations and fund whatever else they want to do, and how they return capital to investors, things like that. And I love thinking about different types of finance, whether it's venture capital, or private equity, real estate, whatever may be, but banking, you're a glorified Excel, wizard, you know, so like, you're really good at Microsoft Excel, but you don't really have any input in anything. You're not thinking strategically. You're just doing the same thing over and over again. And you definitely learn something but you know, what you learn, you can learn the first month or two months, and then gets very, very repetitive and you're working 20 hours a day and, and I like to call bankers, I hope no one here investment bankers, you are I'm sorry, but necessary leeches on society. The world definitely needs investment bankers, but is on the hard work that other people have have done. And so yeah, that those are my thoughts on banking.
Phil 03:59
Totally. Do you? Do you think there's a world where software replaces the need for an investment banker in the long run?
Austin Rief 04:08
I don't know soft. I mean, I don't know software replaces bankers, but I don't think the industry is going to be as lucrative. I don't think, you know, like, Oh, I'm the CEO of this company. And my, my good friend is an MD at Goldman. And so I'm gonna give them 3% of this transaction. Like the fees are ridiculous and their legacy fees. And it very much is like insurance. Right? You know, like, there's the Warren Buffett quote, I believe Buffett or someone said, you know, no one ever got fired for for buying IBM, and that type of risk averse thing, and no CEO ever got criticized for hiring Goldman Sachs. True at some point shareholders have to speak up and be like, you have a bunch of reality. You have a 23 year old, doing half the m&a process and you're paying two to 3% of the capital. Price. It's it's absurd. You know. And there's a whole debate about IPOs. But m&a, the fees are crazy. And so I don't think software is going to replace them. At some point software should replace everything. But I think in the short run, we're gonna see a complete compression of fees.
Phil 05:17
Nice. When you were starting starting morning brew with Alex at University of Michigan, what did the early versions look like? Well, what was it all about?
Austin Rief 05:27
Yeah, so the first version, the one that Alex was doing before, we put together morning brew was pretty terrible looking. It was a PDF, there was a clipart of a bull and a bear fighting that still had the watermark on it, because we don't want to pay 995 to pay for the image. And but it had the same, like, it was humble beginnings, but it had the same idea. It was how can we take the wall street or the left side of the wall street journal, and make it more engaging, and we spent so much time talking about it. And when Alex and I started writing it, we realized, I think the biggest revelation we had was, we could talk about the tone, we could envision the tone, you know, we had this thing where we both knew what we're talking about. And him and I could produce it. One sentence, a newsletter, maybe one paragraph and newsletter, if we were lucky, maybe a story and newsletter. But we knew we couldn't create consistently every single day, every single story, the tone and voice we wanted. And so that's why we tried to hire writers, which obviously, the best thing we did, because we weren't, we weren't great writers. So it looked like crap. It had the right idea. had the right, you know, DNA, but it wasn't nearly what it was today.
Phil 06:43
Got it? And why do you think morning brew kind of had so much success? I know people look at things, it looks like an overnight success. But I know it's years in the making, as it usually as it usually goes. But you mentioned timing being super important.
Austin Rief 06:58
Yeah, timing was huge, right. So there's a few things. The first thing is that we, we started off as a side project. And while that seems like it's not super important, it was actually really, really, really important. And the reason being, there was no expectation, we didn't have a rush, we were in a rush to grow and make this thing bigger. We were so simple. You know, we were like pretty simple minded about this whole thing. And, and I actually I talked about this a lot, as well, which is, I think we were the only team on the planet to be able to create morning brew. And that seems very cocky, but it's actually an insult to ourselves. Because if anyone else had more media experience was do what we were doing for so long, they would have they would have lost their mind. Because what we were doing for media, people who've been the media industry was so simple, you're creating a newsletter, right? axia, as long as they have five or 10 years letters, right? skim launches, they, they start doing video and audio and all this stuff early on. And you know, all these other companies do so much. But for us, it was so much work just to get a newsletter out. And so, you know, just the fact that we were so early in our career, we had no experience, we just got so lucky in the fact that we picked a product that ends up becoming really, really valuable. And the other thing is capital in 2015, when he started this thing. Everyone's raising capital, right, BuzzFeed was raising hundreds of millions vices, raising hundreds of millions of schem, raise 10s of millions of dollars. And if you would have asked me in 2015, who I wanted to be, or I O wouldn't be mike.com. Or we'd be vice, we're going to go out and raise 10 or 20 or $30 million. In 2017. When I graduated, it was time to raise capital. The world was a very, very different place. People were it was doom and gloom in media. Everyone was saying the industry was screwed. And so we took the opposite approach. We followed up all those companies, I think we were one of the first companies after the pivot to video failed, say, Hey, we're gonna do the opposite. Instead of raising 10s of millions, we're gonna raise as little as possible and get to profitability. And so much of that was timing luck, right? That's not we definitely identified a trend. And I think we were really early to that trend. But almost all of that stuff was just luck. Totally. Did you end up raising like, I guess a smaller amount of capital or was it completely bootstrapped? We raised 750,000. Small, awesome. Yeah. How did you know when you guys had found product market fit? I mean, at the time, we didn't even think about it like that. Right? It wasn't. I mean, we knew we had product market fit when when, when there was no way to sign up for the newsletter. But people were emailing us every day saying hey, I was looking over john shoulder over his shoulder and saw this thing. I I asked them who was from They gave me your email address, can you add me, we were bc seeing people, we weren't using MailChimp and we weren't using, you know, anything like that we were just really just, you know, just and it was growing it was it was it was an email, it was growing a lot. And so we knew from day one it a product market fit. Because we again, it was so small, it was our friends, it was our family, and that was our classmates. But people were just reading and it was growing by itself every single day. And so we never really didn't have product market fit. So it was just it was really unique in the way we were able to build it from the beginning.
Phil 10:40
That's super cool. Yeah, I think like when the markets pulling you and you don't even have a way to sign up. It's a good signal that you've got something really interesting going on. Yeah, exactly. I think that was that was a big telltale sign for us. Very cool. And so and so fast forward more to like today, morning brew is going after ton of verticals, tons of different content formats. How do you guys actually think about what verticals to attack? What formats to go after? If you're able to share?
Austin Rief 11:08
Yeah, so I look at media in a few different buckets. There's not many successful media businesses, but the ones are successful do three things. They make you better smarter at your job. They target a passion audience that people care deeply about, or they provide a service for you. So let's go through all three buckets. The first bucket, creating content makes you better at your job. That's a standard b2b media business, right? So if you're in the retail industry, that's retail brew, or retail dive or, or maybe modern retail from digitais. Um, every industry is a trade publication or something that they cover. Yeah, that publication covers, that's the first. The second is passionate audiences. So that is a media industry covering watches for watch fanatics, or a media industry, covering the investing world, for a media company, covering humor, write things that people are deeply passionate about. And the third thing is service, you know, writing services. And that's more like the points guy telling me which credit card to use. If you don't do that, you're kinda dead. Right? There are exceptions. But those exceptions are really, really rare. The exceptions like the New York Times, has been around since, you know, a very, very long time. And so those are the three areas, we don't do the third, the third, and I can talk about that as challenging. So we do the first two, right, we have a b2b business. So we have retail brew, covers the retail industry, we target retail professionals, very high CPM ads, very high quality audience, it's all about depth. The second thing we do when we're launching more of is passionate audiences. We want to take morning, Bruce reader, the modern business leader, put them at the center and say, What are the things we want to create, that those people really passionate about? Things like investing content, like productivity content, like, you know, workplace culture content, like personal finance, things like that. And so those are the two areas we really care about is making people smarter at their job, or targeting a deep passion of theirs.
Phil 13:19
I love the framework. And I guess my assumption is services is something that just like doesn't scale very well, which is why it's not a focus.
Austin Rief 13:28
It's, it's not it doesn't scale well, but so like, you know, you oftentimes don't even know these businesses, because they're just, they're, they're just built off the back of SEO and Google. So one of the most successful media companies in the world that no one really knows about, is I can't even remember the name, but now it's whoever owns investopedia dot dash, right, guy, dot dash dot dash owns investopedia. And they own a bunch of other companies. And so you know, it's the investopedia is of the world. And so that's built off of decades and decades of SEO, or it's the points guy built off of years and years of SEO, and that that service type content is really, really hard to author you monetize that via affiliates. And to make real money in affiliate marketing. You need to have insane scale. And longtail one piece of content needs to be leveraged for decades. Cool. So if we fast forward, like 10 years out, what do you think morning brew looks like? Yes, so I think morning brew is a little cliche, but it's more of like a let's call a lifestyle company, right? Where we represent the lifestyle of young business professionals. We make them smarter, it's our job. We help them invest their money, we help them save their money. We help them make all the big decisions in their lives and we just make them better professionals. And I think that comes in the way of content, I think comes in the way of education. It probably comes in the way of subscription, and community, and you know, commerce. And so they'll probably be eight to 10 revenue streams of different things that, you know, we can engage these people with.
Phil 15:14
Super cool. And just having like the power of Business Insider behind morning brew alive, just get there faster. What was the thinking? Behind joining forces?
Austin Rief 15:25
Yeah, I mean, we're doing a lot of things for the first time. And insider is super helpful in the fact that they do a lot of things. And there's a lot of people we can lean on. They also have a really, really big audience. And one of our largest costs is paid acquisition. And so they allow us to buy past some of that, by using their top of funnel to grow our newsletters.
Phil 15:49
Makes a lot of sense makes a lot of sense. Has it been a good experience so far? I guess that's kind of a leading question to some extent. But
Austin Rief 15:55
yeah, I mean, no, no, it's been great. It really has been, I was definitely nervous. But it's really been great. Super cool.
Phil 16:02
I want to jump a little bit over to kind of like the media and the crater space, the newsletter space, you know, I hear a lot online about, you know, a lot of folks talking about how every company has to become a media company. As someone who's actually built one of the most interesting media companies, I'm curious kind of your point of view on this and what that means to you.
Austin Rief 16:20
Yeah, when people say every company is a media company, I think what they mean is distribution really matters. What they mean is that we are in a hyper competitive world, where I'm not gonna say product is commoditized, because there certainly are products that are differentiated. But there are many, many products that serve the same needs of your customer. And so the way you differentiate yourself, especially in a world in which fate, you know, there are no new paradigm shifts in the way of social, right. So there's no like, there's, there's Yes, tiktoks come about, but it's hard to get in touch with your customers. It's expensive. Facebook ads have grown grown through growth, double digit every year, in terms of cpms, and costs. And so when you live in a world, which it's really tough to pay for distribution, you need organic distribution. And that's where this idea of every company's a media company comes because you need to connect and relate to your customers, either a lot of really interesting things, and we can talk about them, right things, the things I find the most interesting, are companies that kind of combine commerce, and media, and all that kind of stuff. So a barstool sports is really interesting. A mischief is really interesting. The PLL is really interesting. Those are the things I find really interesting is people who have, you know, media components, but everyone needs to think about distribution, everybody's figured out how people are going to engage with their content. Totally. What do you think barstool sports gets so right, with the kind of amalgamation of commerce and media through this like big platform that they built. Here's the thing barstool got Right, right. It's white, everyone who's saying I'm gonna build the barstool for access wrong. barstool for lack of a better term, like, eat shit. For 10 or 12 years, they didn't raise the venture money for the first 10 or 12 years. They were just a bunch of people creating content every single day. And barzal the ultimate thing like, you know, Dave Portnoy and big cat, these people look like huge celebrities. But they've been at these benefits for 20 years, for so long. And so they, they, they just create a content that was consistent every single day. Now, Erika Nardini is coming as CEO, and built a really great strategy and a really great plan. And I think she is one of the most underrated and one of the best CEOs on the planet. With that being said, You can't replicate what they did, because they just loved creating content, and did it over and over and over again, for many years. So they were consistent. Now you can talk about all the things they do right now they have this insane brand affinity, right, they put creators front and center, they built up the right flywheel such that most creators stay for a very long time. They you know, they do all the other day, they make sure that a crater comes into their ecosystem, they can monetize them better than the creator outside their ecosystem. So why how can they retain talent because they do a really good job of selling merch and doing all this stuff such that they can pay creators a lot of money but at the end of the day, they're successful because the first 10 employees were creating content you know without any need to raise venture capital anything for a decade.
Phil 19:38
Yeah, that makes a lot of sense. I love how they put the crater front and center and you know, I feel like there's a risk to some extent around building your brand around an individual and such an integrated way like they do but the reward side of things is you kind of just your brand transcends just this you know, kind of entity and how do you think that morning bro or even more so how do you think companies are trying to become media companies should think about integration of creators with with their kind of like with how they go to market I guess.
Austin Rief 20:07
Sorry you broke up there for a second while you're saying
Phil 20:10
no worries, I love how barstool sports like brings creators front and center into how they create content. How do you how do you think others can like learn from that? or How are you are? Are you doing anything from morning brew perspective, to take your craters and put them for instance, one thing I love that you guys do is your entire team like dominates Twitter? It's It's unbelievable what what what your team does in that space? And I am curious, like, what's the? Is it organic? Or is there like a strategy behind this? And how can people learn from it?
Austin Rief 20:37
Yes, so and we really empower our employees to be active on Twitter. You don't have to be but we certainly love when they are. And, you know, sometimes we look like idiots when they leave and like, you know, we're sending audiences away. But we empower them. Yes, it is deliberate. Right? I deliberately made a huge effort to be active on Twitter and build an audience their morning brewing deliberately until Twitter, we want to own social and we must start with Twitter. I think there's really interesting opportunities on LinkedIn. But we are starting to if you see what we're starting to do, it's slow. But we are starting to emulate. I just said, you don't want to do this. But you know, a little bit of like that barstool mindset where we have Kinsey hosts a great podcast, we have Alex, my co founder hosts a podcast called founders journal. Right? That's a passionate audience. He talks about entrepreneurship. He talks about building businesses, and what's it like to build an actual business? So there is that, you know, we're going to launch a couple more podcasts next year, which I'm really excited about. There's one I'm, I'm very, very excited about. But we're starting to do that we're trying to put the creator front and center. But the important thing is you have to have the the infrastructure to do that, or the leaky bucket people come in and they leave.
Phil 21:54
Makes a lot of sense. Very, very cool. Do you think that you need to employ the crater for them to own like a huge asset within the portfolio? Or can you start to partner with craters outside of you know, your employees, your employees circle to, you know, extend the brand?
Austin Rief 22:11
Yeah, you have to be really, really careful about investing time and resources into people who aren't employees, because it's just so fleeting, if you don't own the IP. It's really, really tough. And I know there's this big emphasis on, you know, empowering creators. And I know, there were some issues with some of these legacy media companies about IP. But I think what people look at is people look at this scenarios. I mean, it's very similar to the music industry, right? It's similar to like the whole not to get like controversial with the whole like, Taylor Swift, Scooter Braun thing like that whole, it's, you know, when a podcast blows up, people like, Oh, my God, it's so unfair, that the creator doesn't own the IP to that. What people who say that don't realize is, there were also 75 or 99 podcasts that failed, where the business took the risk on those podcasts and lost money. And no one's sit there and says, Oh, it's so unfair, that, you know, the creator isn't paying the business back for this failure. And so it's really, really hard. Are there times where you can opportunistically do that? Yeah, absolutely. Like, you know, there are times you can partner. But that can't be the main thing you're doing if the main thing you're doing is just becoming like a network for podcast, not owning any of the IP, that the value is not really there, you tell him much value.
Phil 23:35
Yeah, yeah. And I've seen a lot of that content. I know, I know, barstool sports faced some challenges that were pretty public with like the call her daddy team, how do you think about kind of, you know, the value being shared? Or should the value be shared between the creator and the business behind it? Is there like a right way to do it?
Austin Rief 23:55
Um, you know, the, the call her daddy thing was very public, but that that's inevitable, right? Yeah, it's partly like a part of the job. It's, it's not a good problem to have. But it's a good problem to have, right? Like, you don't want to deal with that. But the only reason they had to deal with that problem is because they had one of the most impactful and then the highest downloaded podcast in the world. And so it's like well, you're they're almost too good at their job. Right they I mean, color daddy was so successful. And yes, you will lose people. But the thing Barcelona, Barcelona good job of his velocity, right. They don't bring on one creator. A year they bring on 20 barstool is failing it more things in a week than most companies try in a year. And so you don't even see these things they fail at because they have a great data system in place. Okay, this isn't working let's next then. So yes, some things are gonna blow up and you hope you can retain them. But it's not a bad problem to have that you blew someone up to the point where They can now go out on their own. That's very rare. True, I like to point of view,
Phil 25:06
I want to talk a little bit about like substack. And the rise of this kind of independent writer or newsletter, you know, I've signed up for so many that I think I stopped opening most of them. What's your point of view on kind of substack? And where that where that goes, you know, we're seeing such a rise of people writing and the content. There's a lot of good content out there. But I'm curious as someone who kind of is like a pioneer in this space. What do you think happens with substack? And the independent creator?
Austin Rief 25:33
Yeah, so I think we are in the not even the first inning when there's one out in the in the baseball game. With the Korean economy, there is so much opportunity. There's this big hype, or there's a lot of talk around subscription fatigue. And I think there are two things to this. I do not think the vast vast majority of content should be paid. And I think that is really okay. It is totally fine, that content is not paid. There are other ways to monetize yourself, then creating a paid subscription. In fact, I'd argue that it's really tough to have a paid subscription, because that is your best content that you're putting behind a paywall. And so it's, it's really tough to do that. But I think there's so much opportunity. And I see Adam Ryan's here. And they, they did an unbelievable job of this. At the hustle of creating a a community and content where they built the top of funnel, they built that audience, and then you can go paid. So I think it's really interesting. I think it's exciting. I have a sub stack I have posted to it exactly zero times. But I'm building out the email, I looked like 2000 emails, actually and find the time to actually write something. Yeah, I can imagine it's hard to find time with everything going on at a morning brew. I like the point of view, I actually have like a thread in my drafts and ever throughout, kind of with a similar perspective that like most content shouldn't be paid. And there's arguably better ways to reach a larger audience and monetize outside of subscription, which we spoke a little bit about an advertising, which is kind of low hanging and obvious. How else do you think, you know, folks who are just creating and writing should be thinking about monetization? Besides those two channels? Yeah, I think there are there are endless ways to monetize. I think the idea of a goal goes back to what your goals are, some people will write just to get a better job. Right. Some people just want a better job they and so they use writing as a way to attract. It's like the new resume. Again, cliche but very true. We hired someone I would never have met him. If it wasn't for his newsletter. I read the newsletter. I think it's great. We've been friends last 18 months, we hired him. And he has been an absolute all star. In the few months. He's been at morning brew. You gotta bet Yeah, he got what I believe to be at least a better job simply because you wrote a newsletter. I know a bunch of people are doing consulting gigs for venture capital firms. Simply because they're a newsletter. They attract venture capital firm, people like David parral, and Tiago. They're doing courses. And they're making a ton of money. With these cohort based courses, where for a month or two, you teach a skill, you can have a rolling fun like I do as well and becoming venture capitalists. So there are there are limitless ways to monetize, that I think are almost all better than subscription.
Phil 28:27
Love it. A lot of good ideas there for folks who are listening the audience. One more thought I'm just the kind of the media space. And I kind of actually want to question you a little bit about the rolling fund in angel investing I noticed you're starting to getting some really interesting companies but where do you think the big guys go? Like the New York Times The Wall Street Journal's the Washington Post's? Are they just too big to fail? Or what happens then? You know, taking a 10 year 10 year outlook?
Austin Rief 28:52
Yeah, I think you have to look at all three of those differently, because they're all very different businesses. The Times is a machine. The Times. It's pretty scary actually how impactful The New York Times I don't think people are aware of just how was just what they're doing. They are poaching editor and she like they poached Ben Smith, who was the editor in chief of BuzzFeed. And his job is to write a single column a week at the New York Times. He ran BuzzFeed news, and he writes a single column A week they post as recline Kara Swisher these are like pioneers in the media industry. And they're just paying them more than they did their old job. And they write a column or they host the podcast, The New York Times so it's, it's pretty incredible to fly we'll The Times is built out and and someone I don't know if you've seen it, but someone built this really in depth presentation on the times, which is fascinating. So that's New York Times. The Washington Post is trying to become a technology company and so they have Zeus and these other ways to help other tech other media companies monetize. I think that's a challenge because If I were to pick a customer set that I want to sell to media companies are about as far down as you can possibly get. In terms of companies, I want to be my customers. So I think it's tough, but I think they're doing a pretty good job. And the journal, that's the ultimate b2b play. So you get your everyday people's work pays for the Wall Street Journal. So that's a great business because of that. The problem is the average age of the journal is quite old and getting older. And so they all have challenges, but that those three businesses are quite successful. Cool, really interesting points of view. I, I I'd love to actually look at that deck or presentation you mentioned if you don't mind dropping in the comments, if you have access to it. Yeah, let me I'll pull it up. Yeah, it's mine safety disclosures.com. I'll drop it. Yes, we appreciate that.
Phil 30:54
On Angel on angel investing, you know, I saw you recently launched rolling fund, you mentioned that? What do you focus on investing in?
Austin Rief 31:02
Yes, so I started a fund, about five or six months ago now, investing in early stage tech companies, I try to keep it really General, you're not deploying that much capital, it's, you know, quarter of a million to half a million dollars a quarter. And so it's really great for marketing to say, Hey, I'm the no code. Or I'm the future of work fund. But I don't think that's great for generating returns, I don't want to be an index for a specific industry. And so I'm investing across sector, there are a bunch of things I think, are really interesting. I think some of these platforms that enable creators are really great. So I invest in a business called circle. And it's a like a slack for creators, it's a way to connect with your audience. And they're doing really, really well. So create our economy is one thing. Another thing is direct to consumer infrastructure. So I don't invest in direct consumer businesses, but I invest in the SAS businesses and the technology that helps them become, you know, bigger online businesses. And for me, that's a it's a business where it's really easy to show your ROI with a lot of these businesses, right? If I'm a, if I'm a checkout, if I upsell help you upselling your checkout page, it's really simple. If I'm making you more money than I cost, you're gonna continue to pay me because I'm making you more money. That's another interesting industry as well, that I, I like to invest in
Phil 32:33
Do you have any frameworks, when you're, I'm sure you get a lot of deal flow. And when you're looking at a deal, how do you actually evaluate it?
Austin Rief 32:39
Yes, so I look for, you know, number one I look for, you know, founders tackling really large issues and large problems. So when can I when I transition from writing Angel checks to running a fund, I'm more focused now on, you know, big ideas and things that can produce venture returns. So it's got to be a big idea, big ambition. You know, I love running lights, people are running lifestyle businesses, it's just not what I invest in for the fun. So first thing is no big idea. Second thing is founders, who I think are great. And founders, who I think are great are people who very succinctly can articulate their vision, and how they get there. So many people are like, you know, I want to do X, Y, and Z, but can't tell you how they're going to get there. So it's, it's what industry they're in. It's the founder, and how good the founder is. And then a lot of it comes down to no traction if they have any. So I like to invest in businesses that aren't, you know, pre customer or pre revenue, but have shown some product market fit have shown an ability to either get users or get customers, depending on what the business is. Great framework. Did you ever think about kind of that founder market fit? Like sometimes you have all those things, but the founder maybe is like, super near the space or you don't think that matters? I think it depends on the space. If it's a really, like regulated space, got really boring space, aliens get changed. You know, these be innovated on? I think it's okay to have a founder who like real estate, right? Yeah, it's okay to have a founder views things very differently, right? You start thinking about like Airbnb or Uber and transportation. You know, you have someone who just refuses to say no, and just willing to disrupt the space. But if you have someone who's trying to get into like eecom infrastructure, right, if I'm trying to create a better checkout page, or a better shopping cart experience, you're gonna want to invest in someone who worked at MailChimp or worked at Shopify, or worked at you know, if you if you want to invest someone who is launching a social app, you know, there are exceptions, but generally, people who've worked at Snapchat or Facebook are a pretty good bet. There. So, it depends on the company, right? Like that's the that's one of the problems of venture is because you make all your money on the long tail. It's really tough to talk in terms of generals, because the general company makes you know, money. It's the edge case. It's the zoom, it's the slack that makes you all the money. And those most of those companies come from pretty strange beginnings or, or interesting founders who don't really fit a mold. Totally. It's funny, as you said, venture scale or venture returns, I saw Mike from Greylock, like jumped into the room. So there had to be some something going on in the world for that to happen. That's funny. Hey, Mike.
Phil 35:42
What's up, you know, what's the most impactful thing that you've taken away from from some of the CEOs that you've worked with, or lessons you've learned from them?
Austin Rief 35:51
I mean, that's, that's the reason why I like doing it is it's just fun to, to watch people. And I like to compare them to where I was. And when we started this thing, we knew nothing. And so we were learning on the job. And we were really learning I didn't I again, like I said, I had a single internship before doing this. And so it's pretty impressive to watch a founder and see, like the circle founders, right. They, they worked at teachable, yeah, which is a somewhat similar company. And so to see how prepared they are, you know, I tweeted about this today, when I started morning brew, we had revenue projections, like, you know, 18 months ago, that match up to what we're doing now, we had employee projections to me we have now. So we could run a model and pick a growth rate and say, Hey, this how fast we want to grow. That's easy. What I couldn't do, when I started morning brew, was actually feel what it was going to be like, when we were at 75. employees, I just didn't have that ability. And so founders who can do that, who can really empathize with themselves and 18 or 24 or 36 months, it's really incredible to, to talk to them and spend as much time as possible, because they can, they can stick they can predict and see the future. And so that those are the founders, I love talking to spending time with the ones who can really give you and paint you a picture of the future. Yeah, I love that meet. How would you articulate how it feels, you know, being at 75 employees and something that you just couldn't imagine when you were starting out? Yeah, I mean, it's one of those things where you you very much put one foot in front of the other. We grew fast, but it wasn't. It was it was always fairly linear, in terms of growth. So it's one of those things where it's not as if, you know, overnight, you 10 user growth or, and there was no event that change anything with a newsletter, just constant growth. And yeah, there are days that maybe grow 5% versus 1%. Yeah. But I mean, we woke up in June of last year, in June of 2020. And we had 35, or 37 people. And as a leadership team, we sat down, this was during COVID, we sat down and we were like, We don't have nearly enough people to execute on what we want to execute on. And we don't have nearly enough senior people, people who have done it before, who've seen it, who have run it. And so we really, really have been on this path of hiring more senior people who have been there who have hired the right people. And so we started off last year 25. We're at about 75. Now, we'll be 125 by end of this year. And so that's Yeah, that's really been, it was really a big change of mindset for us.
Phil 38:51
Very cool. I want to start wrapping up, I have a couple more questions. I know you got to run at like about 650. Eastern. So one question I've started to ask as I host these, it's a bit of kind of like a high level or vague question, but you can take it where you want. Do you have any like personal philosophies that you live by or philosophies that guide got how you make decisions and how you live your day to day?
Austin Rief 39:17
Yeah, I think the the one thing that I come back to time and time again, is that at the end of the day, you know, no one truly knows what they're doing. Right? people absolutely are like, Oh, you know, people know how to grow a company, right? So if someone is wrong, grows at five companies, not around growth, but they don't know how to run growth at your company, at your stage at what you're doing. Every scenario is unique. And so I think so often do people have like analysis paralysis, where they try to just pattern match or whatever. I very much just tried to, and I've learned to trust myself, and the things I believe, and what I think in. And you know, at the end of the day, at some point, whether it's now or 50 years, at some point, your company's gonna fail. And so if you're humble about the fact that you're going to make mistakes, you know, you have to trust yourself. And so it all comes back to like, you know, you, you may get criticized, or you may make mistakes, but then they, you're the one who got or I'm the one who got myself or got morning grew here, obviously, with a great team. And so just continuing to trust them believe in myself, is something I think a lot about, especially in a time where you get imposter syndrome when, you know, we started this and had no media coverage, or no press coverage, and now we get a decent amount. And so constantly, just believe in yourself is really important for me, I love that it's a really a really great philosophy. When you look forward, like 50 years out where you're kind of at, like the last leg of your life, or maybe 70 years out, I don't actually know how old you are. So whatever you're at the last leg, you're looking far out, you know, what have you accomplished? or what have you done to know you've lived a fulfilling life? Yeah, that's a, that's a pretty deep question there. I like to think that I like to, you know, think about as much or more about how we work as the work we actually do. And so, you know, thinking about how we communicate with each other, how we get to decisions, is really important for me. And so any company I started or will contain a start, just making sure that, you know, everyone at the company leaves the company better. You know, we're having a bunch of awesome early employees for morning brew leaving. And for me, that's really awesome to be able to have people who, you know, started morning brew, who can now start their own companies or grow other companies. And that's pretty cool. And to see and make morning brew a place that I, you know, can can, like, become a place where people want to work because it can accelerate and expedite their career. So I think from a professional perspective, that's certainly something I care a lot about his, his the way we work at morning brew, and, and the place we can build, and people can use it as a springboard for their career, if they don't want to stay in media, or they don't want to stay at morning brew.
Phil 42:36
Cool. Are there any kind of like systems you put in place to help make sure that happens?
Austin Rief 42:42
Yeah, one thing I'm a big fan of is, is this book called traction. When people you know, it was, it was recommended by a few people. And at first I was a guy, it's kind of silly, like, it's a book, I'm not gonna run a company by a book. But I'd say like five or six people recommended to me, and people I really respect. And by that point, I was like, okay, like, I have to at least read the book. And so I read it. And we don't copy it, you know, page four page. But there are principles, right, running the company, on a five year plan, and a three year plan and a one year plan a 90 day rocks, and they're very similar to okrs. But that cadence of looking at things at different time horizons and different levels of granularity, over different time horizons, I really, really enjoy. And I think it's a single source of truth. As a young founder, that was really helpful. I could always be like, well, it's not me, it's the book. And so we have to follow the book says, and so that's been really helpful to instill that in everyone at morning brew. Super cool. I was gonna ask you, actually, if there was a book that's had a really big impact on your career, I guess traction maybe is that book. Yeah, that was definitely one. Another one I love is deep work. And yeah, I'm, I'm big into forcing people in morning brew, to chunk off time. I personally just can't get things done, if I call throughout the day. And so I looked at staff three, four or five hours, at least two to three days a week, just to think and work and I push people to do that even if you work in like a sales organization where it's it's much tougher.
Phil 44:28
Cool. All right. Last question from his I feel like I've got to ask this especially with what's happened the last couple months. What's your point of view on Bitcoin?
Austin Rief 44:38
I'm, I'm a believer. I really, I don't know as much as I probably should have gotten into it. Of course, you know, when it when it hits 20 k a couple years ago, and I've gotten into it recently again, and I think it very much aligns with where the world is going. There's a lack of have trust in institutions. There's a lack of trust in news and authority. And I mean, the internet and social media have really, really changed things. I don't think people can truly understand what zero distribution cost or zero marginal cost actually means. And I think people are really struggling to understand these things, and their impact on the world. And I think people will constantly go back to things they believe stands for, you know, anti institution. Like, like Bitcoin. So I'm a believer. Love it. Me too. Me too. Oh, we got one from us. Me too. I love that point of view. We got one more question here from the audience, then we'll wrap it up. That's That's cool.
Phil 45:53
Oh, yeah. Love it deal. Delia asked what formula do you think is applicable to any business where b2b or b2c, whether b2b or b2c to build high engaging organic audiences?
Austin Rief 46:06
What formula? So I think the way I'd answer this, I'm not positive. I interpret the question, right. But I think there's this idea that I've I've tried the champion, which is building in public, I think it's really interesting is especially for b2b businesses, right? Like, no one, especially in the early days, actually cares about a b2b business. It's impossible. No one cares about a CRM, no one cares about a home and cares about a button to help you check out faster, like no one cares. But people may actually care about the founder of that business and their journey, or may care about those decision makers. And so I think this idea of building a personal brand and leveraging that is a really interesting one is a really easy way to go from zero to one. And so I'm a huge fan of when b2b founders put themselves out there and, and build and public. You know, when you're when your aov ease or your LTV are in the 10s, or hundreds of 1000s of dollars, I think it's a really good use of time to make the founder story public, and I'm just waiting for someone to take it to the next level. And, you know, just like video basically do what Gary Vee does now, but from day one, and tell their entire story or like gimlet media, his first podcast was the startup. So I'm waiting for someone to take it to the absolute extreme. But I think it's really powerful. dope. Love it. Awesome. I want to be respectful of your time. We're, we're at the end. I really appreciate you going into all these different areas. Thanks for taking the time. And thanks for everyone listening in. We'll have another talk next week with Kevin who's the founder of me, which is a pretty cool new DTC brand in the ramond space. So, Austin, thank you. I appreciate it. That's awesome. And Kevin's Great, so that should be a great talk. I'm gonna come listen to that one. Okay. Love it. I look forward to seeing you there. Have a great night, everyone. Thank you.