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Building a Business Meant to Last with Peldi Guilizzoni of Balsamiq

Episode #085

Twenty pages into reading his first business book, Peldi Guilizzonni (@peldi) closed it for good and told himself, "This is not for me. I'm never going to start a business. It's insane." Not long after that, he rolled up his sleeves and got started building Balsamiq Mockups, which would go on to employee dozens of people, serve thousands of customers, and generate over $6M per year in revenue. Over ten years later, it's still going strong. Learn about the path Peldi took to get where he is today, why he's a legend among bootstrappers, and how he's building a business that's meant to last.

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    Wonderful, you can really feel the tranquility that his experiences and life path has given him. I think the 18 month emergency fund is a good practice.

    1. 1

      Indeed, the 18 month emergency fund practice seems more relevant than ever these days.

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    My Main Takeaways:

    • Peldi grew up in Italy and then moved to Sillicon Valley to be a programmer. He didn’t have an entrepreneurial spirit, he just wanted to work his way up the corporate ladder and be happy. He worked at Adobe, got promotions and did well.

    • Five years into Peldi’s corporate career, he read a book called “You Need To Be A Little Crazy” by Barry J. Moltz, it taught him about the truths of being a business owner, and Peldi decided that being a business owner was not for him.

    • Eight years into Peldi’s corporate career, he got bored of just being a developer. So he considered becoming a Product Manager, but he was talked out of it after realising that he’d need an MBA and would get a pay cut (he had a family to take care of).

    • A big value of going to business school and doing an MBA is the connections you make. But through Peldi’s lengthy career, he already had a lot of connections.

    • Start your own business, even if it’s just to learn, you never know what it could grow into: Peldi decided to learn the business knowledge associated with an MBA, so he read the 10-day MBA by Steven Silbiger, and also decided to start his own business “Balsamiq”, for learning. He didn’t believe it would last more than a year or two. He put away 1 years worth of money to live on, and took a 1 year sabbatical to work on it.

    • Peldi recommends that young ambitious people who want to start a company to go work at a top company, absorb the knowledge, build connections, and learn in a sheltered environment.

    • Always be learning: After quitting his job, he spent the first few months learning and reading books/blogs like crazy.

    • You don’t need to be a crazy genius with good ideas, you can just absorb from others.

    • Peldi grew Balsamiq to 3,000 customers in about 8 months, on his own. He generated in revenue over $100k in 6 months. And he made his first sale 4 days before he officially launched (that customer found him by searching Google).

    • In the beginning, Peldi didn’t focus on customer acquisition, he focused on making a great product. Eventually, he started giving his product to bloggers for free, for honest reviews and new ideas. This ended up becoming a great source of traffic.

    • You may make bad decisions, but this doesn’t matter, it’s about being able to correct those bad decisions.

    • Embrace the fear and do it anyway: Courtland used to be fearful of emailing his newsletter in the beginning, fearful of contacting advertisers [in the beginning] so much so that he held off from it for about 3 months, fearful of doing his podcast [in the beginning].

    • Peldi keeps 18 months of expenses in Balsamiq so that they always have 18 months of runway to decide how to generate new revenue in case of emergency.

    • Peldi prioritises longevity, not growth.

    • Luck plays a part: Peldi’s parents sent him to California to learn English when he was younger. See Malcom Gladwell’s Outliers for related.

    • Major Key: Choosing a smaller market (like Peldi did with Balsamiq) can help prevent people with lots of money and resources from competing with you, simply because it’s not a profitable enough market for THEM. So leverage this benefit by targeting smaller markets, with smaller competitors.

    • Balsamiq still does not do any marketing, they focus on making an amazing product worth sharing.

    • Know what your product is and most importantly is NOT: Having laser focus, and being willing to leave money and product ideas on the table is key to being successful.

    • Balsamiq is a mature, 10-year old product and business. Peldi now wants the company to be able to operate successfully without him.

    • Don’t tie your self-worth to the company.

    • Try not think about your company all the time. Have a life outside of your company.

    • Have a mastermind group with people who are similar (or on a similar path) to you.

    • The most accurate indicator of quality of life is not money, it’s the quantity and quality of your relationships.

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      Awesome review! You really saved my time, thank you so much!

  3. 1

    Hi @peldi. Loved the interview. I'm curious to hear your experience with Holacracy. I've been tracking it for a while and we're now starting to have clients ask if it's appropriate for them. We've implemented one of the concept "micro-roles" from Holacracy at a couple of places, but not the full system. What was your experience like? The client asking at the moment is about the same size as Balsamiq.

    1. 1

      Hi Salpulse, thanks for the kind words. We studied Holacracy years ago, but never really tried implementing any of it. We got turned off by the fact that it was something you'd have to license in order to use. That said, the concepts of overlapping circles instead of totally separate teams is something that we have as well, and like. We like to give our people the freedom to work on separate projects on separate teams, in a fluid, organic way. HTH!

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        Thanks @peldi. BTW, just started using Balsamiq. Love it!

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