Following up on Mark's admission that he dreads collaboration, whether it's with peers or employees, Jesse discusses one way the leadership team at YNAB has fostered collaboration. They call it the strategic council, and it's a two(ish) day meeting with all the functions at YNAB presenting the challenges and opportunities for growth in each function. The meeting is tightly structured, with desginated time slots for each team to present and field questions. This is critical to keep things moving and keep the focus on getting started with solving problems. It's not a time to fully solve problems and implement strategies, it's simply a time to get everything everyone is working on out in the open, so that everyone is aware of the challenges and no one is caught by surprise.

Mark points out that this type of meeting has the potential to become toxic if teams are concerned about protecting their own reputations rather than being open with their challenges, and thereby use the meeting time to deflect problems and shift blame. To Jesse, this kind of meeting can only happen productively with high trust teams, who are all aligned with the idea that the presentations are a way to make the company better. In a low trust environment, the collaborative aspect of the strategic council falls apart quickly.

Mark and Jesse end on a discussion of collaboration as a way of buying back your time. Jesse explains how his personal assistant has not only saved him time by taking care of mundane problems for him, but has shored up the "mental leaks" that occur when your focus is distracted by competing priorities. Mark shares that despite his preference to use software over humans to free up his time and mental capacity, he has found an employee with high initiative and drive to solve problems on their own to be very useful.

Mark Butler

The Money School: https://moneyschool.works

https://markbutler.com

https://letsdothebooks.com

Jesse Mecham

YNAB

https://www.youneedabudget.com

In today's episode Mark explains what makes the perfect diet coke, and Jesse opens his inbox and reads some comments and questions from Beginning Balance listeners, including tips for improving business leadership skills, how to keep track of all your ideas, and why studies can be highly misleading. Mark and Jesse also address a question about UBI, or universal basic income, and bring up Mark's old standby phrase: "incentives are undefeated."

Mark Butler

The Money School: https://moneyschool.works

https://markbutler.com

https://letsdothebooks.com

Jesse Mecham

YNAB

https://www.youneedabudget.com

Jesse kicks off the episode talking about one of his new endeavours, Ultraspeaking, an effort to double down on one of his biggest strengths: public speaking. This leads to a conversation about embracing your strengths, the things that feed your working genius (see episode #102), rather than trying to build up your weaknesses. Mark shares his comfort speaking in front of audiences, and his fear... of not feeling fear anymore. In many cases, fear is an indicator that you're about to do something that will help you grow. The scary stuff, in other words, is probably the stuff you should be doing in your work, your business, your life!

For Mark, one of the scary things is actually commiting to playing to his strengths in his business, which for him means hiring people to do all the things he's not good at. No business can grow, Mark and Jesse agree, without collaboration of people all playing to their strengths. In Mark's case, identifying and plugging gaps in the business is satisfying work, but it's short lived when it's not aligned with his strengths -- it's really another form of procrastination, chasing the dopamine hit of solving a problem in the short term rather than positioning himself to do impactful work over the long term.

In this vein, Jesse discusses his big 2024 experiment: hiring a personal assistant. While he's still figuring out how best to utilize his assistant, Jesse finds peace of mind in the bandwidth that she creates for him. Knowing he can commit himself to new projects and teams without having to worry about scheduling and other life stuff puts him in the right headspace to focus on the things he's best at and the things most impactful to the business.

Mark Butler

The Money School: https://moneyschool.works

https://markbutler.com

https://letsdothebooks.com

YNAB

https://www.youneedabudget.com

Mark and Jesse are back after a short break with a discussion about slippery slopes... real and imagined. Jesse delivers an epic rant on the uselessness of economists, while Mark talks about his hesistance applying for graduate school in order to obtain the Licensed Marriage and Family Therapist credential.

Mark presents his dillema: he wants the credential to "reduce friction" for clients when other service providers refer him (say, a divorce attorney that refers Mark to a couple for marraige counseling before going down the path of divorce). Calling yourself a family and marriage coach, Mark reasons, makes you have to explain yourself, whereas the title of therapist is self-explanatory. On the other hand, he already has a busy coaching practice doing the same thing that therapists do, so the actual value of the degree is questionable (and the cost is high, in both money and time).

Jesse has a different take. In his mind, any friction that not having the official "therapist" label might create goes away with a strong referral. As soon as the attorney refers a client specifically to Mark, trust is created and the work can take place. It's all about the strength of the referral.

This leads to a discussion about credentials as a form of permission seeking, and the pricing power of a provider who offers their services as a non-credentialed coach versus a licensed therapist. In many ways, the people who become therapists have what Mark calls permission seeking traits -- they jump through the hoops in school to get the letters after their name, and when they start their practice they look to the rates of other therapists and set their own somewhere in the middle. On the other hand, coaches often position themselves in a more niche area at a higher price point, and command much higher rates.

At the end of the day, credentials may be another one of those slippery slopes -- something with more perceived value than actual value in the marketplace.

Mark Butler

The Money School: https://moneyschool.works

https://markbutler.com

https://letsdothebooks.com

YNAB

https://www.youneedabudget.com

Mark and Jesse discuss their most recent read, Never Enough: From Barista to Billionaire by Andrew Wilkinson, a one-time barista and co-founder of Tiny, a holding company that buys and holds businesses for the long-term (like Berkshire Hathaway). At the age of 36, Wilkinson found himself owner of a company worth over a billion dollars, and in a new stratosphere of wealth he had never experienced before. What he found, though, was that the same problems which pervade life in the lower economic classes are still there in the upper crust. The presentation of the problems are different, sure (the middle class aren't generally obssessed with yachts), but the nature is the same -- jealousy, covetousness, ego, etc. 

Jesse shares his own experiences dealing with business and financial success while trying to stay genuine and honest.... while cracking some terrible puns in the process.

Mark Butler

The Money School: https://moneyschool.works

https://markbutler.com

https://letsdothebooks.com

YNAB

https://www.youneedabudget.com

Good gardens require good soil, and good soil takes compost and plenty of time. Jesse shares his experiences composting soil for his garden, and how it applies to business. Like compost, good business ideas take time to execute. They can be executed more quickly, but that often involves more complexity. Mark and Jesse then pivot to discuss complexity in business plans, and when it's worth pursuing complex solutions to problems.

Jesse's rule of thumb: if the business strategy is simple, but the implementation is complex, it's probably worth doing. Many things that appear simple on the surface involved solving complex problems. YNAB's direct import function is a good example. Direct import means that users can link their bank accounts to their YNAB account, and transactions automatically appear in YNAB for them to categorize. It's an important part of making YNAB a smooth and easy to use tool. The intricacies of actually pulling bank data from various banks, each with their own constantly changing API's and backend implementations, is very complex and requires a lot of effort to solve. On the other hand, if a business strategy complex at the outset, before you get into the details of actually pulling it off, it's probably a bad idea!

Mark Butler

The Money School: https://moneyschool.works

https://markbutler.com

https://letsdothebooks.com

YNAB

https://www.youneedabudget.com

The algorithm has come to rule media, and it is a voracious beast. It consumes as much content as people can create, as often as they can create. The ones who rise to the top seem to be those who create the most content, on as many platforms as possible, but what do the economics of this look like? Mark asks the question whether playing the content game is worth it for a business, and if so, what kind of business?

Many would agree that making content purely for quantity's sake, to appease the algorithm and get in front of as many eyeballs as possible, can be a soul sucking endeavour, but not all businesses seem to benefit equally from this type of marketing effort. Some businesses, espcially highly skilled service providers, do just fine relying on word of mouth marketing, and in fact, the more ubiquitous content creation becomes, the more special and valuable word of mouth referrals become.

Books referenced in this episode:

• Anathem by Neal Stephenson

Mark Butler

The Money School: https://moneyschool.works

https://markbutler.com

https://letsdothebooks.com

YNAB

https://www.youneedabudget.com

Jesse shares one of his recent experiments, inspired by a guest on the Art of Manliness podcast. The challenge was to delete the apps on your phone, especially the ones you feel a "pull" from -- a pull to open it and check it every time you see it (most social media apps would meet this criteria for most people). As Jesse explains, phones don't just suck up your time, they suck up your attention, which is arguably even more valuable. Deleting your apps creates a barrier between your brain and that instant dopamine hit, which can restore some balance to your attention span over time.

It's a simple experiment to try, and the stakes are low. If you really need to access an app, you can always reinstall it, use it for a given task, then delete it again. Chances are, you'll find many apps that you don't need that often.

Mark Butler

The Money School: https://moneyschool.works

https://markbutler.com

https://letsdothebooks.com

YNAB

https://www.youneedabudget.com

On previous epsidoes, Mark and Jesse have discussed the importance of scarcity, and how limitations drive creativity. Mark even goes so far as to argue creativity can't exist without limitations! YNAB, then, is a tool for viewing reality through the lens of money -- a reality mirror if you like. By understanding the tradeoffs you are making with your money, you can see the truth of your financial situation. Instead of saying "it must be nice" to... fill in the blank -- make more money, spend less on X, etc -- YNAB helps you undertstand the choices you have made and, eventually, ask you the question "am I ok with this?"

As Jesse explains, this is the real magic of YNAB: enabling people to look at their money and see future possibilities, to make decisions firmly grounded in reality, and actively shape their life into what they want it to be. It all starts by taking a look in the financial reality mirror.

Mark Butler

The Money School: https://moneyschool.works

https://markbutler.com

https://letsdothebooks.com

YNAB

https://www.youneedabudget.com

Mark and Jesse discuss YNAB's recent price increase, and the psychology of customers around pricing. You can't make everyone happy, whether you justify the price increase by citing your own increased costs or by plainly stating your price increase without explanation or caveat. Jesse points out that some customers that have complained about the price increase have moved to competing software, which has copied (read: stolen) YNAB's look, feel, and functionality.

Jesse's primary lesson is this: it's important for a business owner to know what is and what isn't important. It seems rational to get worked up about copyright violation and intellectual property theft, but that path leads to headaches and large legal bills, if anything can be done at all. In this case, he chooses to ignore the competing software becasue, in the end, they are focused on different audiences. The audience that wants a YNAB clone for less money is a small segment of the market that is very price sensitive. On the other hand, YNAB focuses on the segment of the market that isn't doing anything to manage their money, to help them get their finances under control and deliver value.

As Mark points out, tweaking a product or service solely based on customer feedback can be a slippery slope. You think you are satisfying everyone by responding to various demands, but there's a danger that you end up building a product customized to a small segment of the market that's already bought into your business, and losing the appeal to the broader market that isn't a customer yet.

Mark Butler

The Money School: https://moneyschool.works

https://markbutler.com

https://letsdothebooks.com

YNAB

https://www.youneedabudget.com