The Entrepreneurs Radio Show 091 Ryan Carson

THE ENTREPRENEUR’S RADIO SHOW
Conversations with Self-made Millionaires and High-level Entrepreneurs that Grow Your Business
Copyright © 2012, 2013 The Entrepreneur’s Radio Show Page 1 of 26
Episode #91: Ryan Carson
In this episode, Travis interviews Ryan Carson who is the founder and CEO of Treehouse. Ryan is a
successful entrepreneur that built his businesses from the ground up and learned valuable lessons
along the way. Lessons that entrepreneurs can surely learn from and apply in their businesses.
Travis asks Ryan on a variety of interesting topics, and they both shared valuable insights on how
establish a business and to make it profitable without constant guidance or attention. The establishment
of systems in your business as well as establishing a recurrent revenue will surely allow it to grow and
gives its business owners the chance to work fewer hours and concentrate on the things that really
does matter. Entrepreneurs will surely find these lessons valuable, and something in which they can
apply to their own businesses.
Ryan Carson – Build your business
with reoccurring revenue
TRAVIS: Hey, this is Travis Lane Jenkins, welcome to episode 91 of the Entrepreneur's Radio Show, a
production of Rock Star Entrepreneur Network. Today, I'm going to introduce you to Ryan Carson.
Now, Ryan is a rock star for several reasons and I'm super excited to connect you with him. Although,
one core reason is he's done an incredible job of building a business that generates well over a million
dollars a month in reoccurring income. Now, I don't want to diminish the interview here because there's
several reasons that I'm excited in connecting you. But I want to highlight this because I want you to
think about it. And when I say reoccurring income it means that you sell it once and they keep paying
you each and every month. Now, of course, I'm giving you this simplified version of the story now. Plus,
I don't want you to focus on the dollar amount too much either, even though it's very impressive. The
exciting part is reoccurring revenue, something maybe you should consider implementing into your
business. This can really apply to any type of business that you own. Also, be sure and stay with us
until the very end if you can because I want to share some inspiration with you. Plus, as you always
know I got something that I want to talk to you about and in this case it's a question. And I've talked
about it a couple of times and I think, at the risk of being redundant, it's worth bringing up again. The
question is this. Do you have a company you compete with and they always seen to be doing incredibly
well, even though their prices are higher. And maybe even what they offer isn't as good as what your
company offers. Does that baffle you? Yet, they're still super busy. Do you have 1 or 2 businesses that
do exactly what you do, and that's the case. Maybe they provide a great product or service yet their
prices are a whole lot higher than yours. And you can't figure out how they're able to get that level for

what they do, right? If you want to know how businesses do this, this is something we figured out that
completely changed my life. Hang out until the very end of the show and we'll talk more about it.
Also, I want to remind you about a section that we have on the Rock Star Entrepreneur Network
website. On the right side I've placed a little widget where you can click in a microphone and you can
basically ask me anything about your business, marketing, managing, scaling, pricing. Anything that
you feel like is holding you back from going to the next level of success. All you got to do is click on the
button, you got 3 minutes to give me the background of who you are, what your business is. And in the
near future I'm going to start releasing short episodes where I answer your questions on the show. I'll
keep your last name private. Also, if you've got any suggestions for the show, you can just leave them
there. If you're not the type to leave messages, go ahead and go to the website, opt-in, send me an
email. Because you'll get my email immediately. Actually, it's my team's email, and me and my team
read each and every message that comes through. We're always looking for ways to improve your
experience with the show here, and help you take your business to the next level.
Before we get started I want to remind you that there's two ways you can take these interviews with you
on the go. It's iTunes and Stitcher. Stitcher is an excellent option for Android users. Obviously, I'm an
iPhone user, I always have a hard time remembering that. And you can go to
rockstarentpreneurnetwork.com and I've placed links there for both the shows, iTunes and Stitcher that
will take you directly to the apps where you can download them. Now, that we've got all these stuff out
of the way, what do you say we go ahead and get down to business, are you okay with that? Alright. So
without further ado, welcome to the show Ryan.
RYAN: Thanks, it's an honor to be here, I'm excited.
TRAVIS: Man, I'm super excited to spend an hour with you. Hey, before we get started, do you mind
giving us the back story of how you got to where you're at today and how you found success?
RYAN: Yeah, sure. So, I'm 36 now and a father of two. I'm married and I live in Portland, Oregon. And I
started out, went to college, got a computer science degree, and I wasn't kind of an entrepreneur by
birth. I didn't have a lemonade stand, I didn't have any businesses. For some reason it didn't occur to
me.
TRAVIS: It didn't dawn on you.
RYAN: No, I should be a CEO someday. I enjoy writing code and I'm going to see if that works. I
graduated, didn't have any serious girlfriend at that time or any ties, so I thought, "Hey, I'm just going to
move to another country." Because I know there's a lot of stuff that I don't know, that I don't know.

TRAVIS: I like that.
RYAN: And so, I thought, "Let's move to England." Stay for a year, see what happens, and this was in
2000, right before the .com bubble burst.
TRAVIS: Good timing.
RYAN: Yeah. So I got a job over in England as a web developer, and 6 months later got fired, because
the company went out of business. So, that was pretty exciting being kind of alone in a foreign country
with no job, and no family. And I've never grown more than I did during that period of-- all my safety net
was taken away. Family, friends, culture, everything was different. So, I really grew a lot. But it was a
very lonely, hard time in my life. But got another job as a web developer and stayed over there.
TRAVIS: How long were you there?
RYAN: Well, I was in the United Kingdom for a total of 12 years.
TRAVIS: Okay.
RYAN: So, from basically when I was about 22 to about 34.
TRAVIS: Okay.
RYAN: And at the time still an employee and it wasn't around my own company. But I got another job
as a web developer. And then I met my beautiful wife, we decided to get married. And at that point I just
decided, you know what? My boss annoys me. I could do what he does. What does he do that's so
special? They would drive crazy cars, they would show up in Ford GT's, and I stopped, this is weird.
So, I thought, "I'll do his job." And I quit, and I started my first company. And I built a simple piece of
software for the web that helped people send large files. This was 2004, and you still couldn't email files
over 2 Megs, which is hard to imagine now.
TRAVIS: Right.
RYAN: And built it. I got my first customer while I was still at that job. So I had a little bit of a safety net.
I think I had about $5,000 in the bank. And I quit. And what I--
TRAVIS: After your first sell?

RYAN: Yeah. I quit my job and I thought, "Okay, I've got enough money in the bank to protect me a
little bit." And we got married right that point and started this new entrepreneurial life. And I just do
nothing about anything. So, I priced the product too high. It was about 500 bucks a month for a
company to use it. And I quickly learned, this isn't a freemium model or a try and buy model, this is a
sales model. I've got to actually get out and do the in-person sales.
TRAVIS: Right.
RYAN: And I suck at that. I just hate rejection, I'm not very pushy. All these things that you generally
need for sales. And so, I slowly went out of business over a period of a year. I just couldn't make the
sales, and that was a big defining moment of my life when I realized the business was going to fail. And
it sounds like the experience where you have, when we were talking about it before the show, where all
your graph show income going up into the right. You're going to be a millionaire someday and then you
realize, this isn't going to happen.
TRAVIS: Right.
RYAN: And the worst part was I told my wife this is going to work and we're going to do really well. And
having to go to her and say, "You know what, this isn't going to work," was hard.
TRAVIS: Right.
RYAN: And thankfully we didn't have any kids at that point, and she had a full-time job, so the risk was-
- the pain was mostly to my ego. And so, at that point I thought, "I'm not going to go be an employee. I
don't think I can do that again." So we tried a new business and we actually had the idea to do a
workshop where we had a speaker come and talk, and we sell tickets. Again, related to the web design
and web development space because that's what I knew. And found our first speaker and thankfully the
first workshop sold out. And what's interesting is the way that I sold the tickets to the very first event
was very much kind of word of mouth. This is before Twitter even existed, before Facebook even
existed. So, you really had to hope that you could email some friends, and they would tell some friends.
And you relied on the website converting. So, we sold out our first workshop and that was like, "Whoa,
wait a minute, this might be a business." And we did another one, and it worked. And did another one,
did another, and also we had events and conference business going. And that steadily grew, to the
point where I sat down with my wife and said, "Hey, do you want to join the business?" And it was a
hard sell because she was a senior editor at a big publishing company and she's very good at what she
did. But I said, "Listen, we could travel the world together, we can control our life, we can control our
schedule. Let's do this." I remember the moment. We were sitting in a hotel room looking at an Excel
doc at the cash flow. And we thought, I think we can scrape by. And so she joined the business and it

was just her and I in our top bedroom working from home. And we did that for about a year together
and had a lot of fun. We travelled to Chicago, and San Francisco, and London, and Miami. It was
amazing.
TRAVIS: All on the company time, right?
RYAN: Yeah, exactly.
TRAVIS: Right.
RYAN: It's amazing. And had a ton of fun, met a lot of people, and built a really good network. I was
meeting really amazing people who were speaking. I was building up loyalty and trust with all of our
attendees, landing a couple of sponsorship deals. And then it came to the point where we thought,
"Let's do a large conference. Let's get a big name speaker, try to sell 800 tickets, and let's see if we can
do this." And we'd create our first event, and it sold out. And we just kind of kept cranking, and this was
a lot of fun, hired our first employee. And that was 2006 that we hired our first employee. And that's
when we decided to work a 4-day week. So, what happened is my wife and I were working 7 days a
week, killing ourselves. And we were sitting on the couch one night, both with our laptops and she said,
"What are we doing? I thought when you run your own company you're supposed to have more control,
and less stress, and more time." And we had none of the above. And I was like, "You know, you're
right. This is insane." I believe that I should be able to create my own reality and this is not what I want.
TRAVIS: Right.
RYAN: And she's like, "What if we only work 4 days a week?" And I just freaked out, I thought that's
impossible. We don't have enough time now. And she says, "The work's never going to stop and it's
never going to decrease so working more isn't going to help. Why don't we just draw a line?" And I
thought, "Yeah, let's do it." And so, we did that, just her and I for I think it was probably a couple of
months. And it was amazing. And we just put an answering message on the machine that said, "Hey,
the office is closed on Fridays, and we'll get back to you first thing on Monday. Thank you very much."
And just kind of set that expectation with our clients. No one really blinked an eye. I don't think I ever
heard a complaint about that.
TRAVIS: You know what's interesting about that is you gave yourself permission.
RYAN: Yeah, which was hard.

TRAVIS: Right. And as much as that sounds like a "duh" statement that's really how it works, isn't it?
You got to give yourself-- most of the things we agonize over, even your ego when you lost things,
because I did the same thing, is I hadn't given myself permission to fail. And so, I literally beat myself to
pieces. And so, it's all about giving yourself permission. I don't mean to interrupt your flow, but I think
that's important to illustrate there.
RYAN: Yeah, you're exactly right. And, we thought, "Well, this seems to be working, let's hire our first
employee." And that's when the moment we have decided do we officially work a 4-day week or not.
Because once you tell an employee that you can't really go back.
TRAVIS: Right.
RYAN: And so, we did. And ever since 2006 we've been working a 4-day week, and my current
company Treehouse grew up to about 70 employees, doing over $8 million in revenue, and we still
work a 4-day week.
TRAVIS: Wow.
RYAN: Yeah, it scales. And it's been amazing for recruiting. We always win. If a person is looking at
working with Treehouse or another company, the 4-day week, we always beat the other company. And
it's been a powerful recruitment tool.
TRAVIS: So, there's tons for us to talk about. Let's go back over a couple of things if you don't mind,
okay?
RYAN: Sure.
TRAVIS: Alright. So, number 1, what I hear is with your business is, was incremental success. And I
think there's this misconception that things happen overnight. Success very rarely happens overnight.
There's incremental success. So you sold your first workshop and then you sold another one, then
another one, then another, and then they got bigger. You can hit the fast-forward button and you can do
it fast. It's kind of like stairs, but you still have to take the steps. Sometimes you can jump 2 or 3 steps
at a time when you really got momentum going, sometimes 4 steps. But you still got to be walking the
miles, putting the work in, putting the effort, evolving and growing. And what I hear is you guys were
evolving, and growing, and refining, taking those steps and then kind of the 80-20 Principle, throwing
what wasn't working away and doing more of what was working. You feel like that's an accurate--

RYAN: Yup, 100%. And one of the keys to my success looking back was running an event, a
conference in the vertical that I was selling to. Because I didn't know this at the time, but basically, all
these big conferences and events, what they were doing for me was setting me up us a trusted source
in the web design and web development industry. So, we got to the point where I was on stage
interviewing really famous people like Mark Zuckerberg from Facebook, or Evan Williams, the founder
of Twitter. And what happened in the audience's eyes, they see me on stage with Mark Zuckerberg.
And then there's some sort of association that happens. "If Ryan's talking to Mark, and he must know
what he's talking about, and he must be connected. It must a big deal to speak at this conference. So, I
should meet Ryan."
TRAVIS: Yeah, I love the fact that you're pointing that out because it's expert positioning, right?
RYAN: Yeah. I was too naive to know that's what was happening, but looking back it is what laid the
groundwork for the success of Treehouse. So I spent 7 years building this network that I was too naive
to know I was building. But then when I needed it, I could call upon this network, and it was absolutely
powerful.
TRAVIS: Right.
RYAN: So, when we decided to raise our first money for Treehouse, I showed the product to a guy
who's well-known in the space named Kevin Rose, and he said, "This is amazing. I want to put $50,000
into this and I'm going to put together an amazing list of investors for you." And so, he then access to
the network and I got folks like Reed Hoffman, the founder of LinkedIn, to invest in Treehouse. And that
would have never happened unless I would've been fortunate to take years and years to build credibility
and a good network in the field I was in. So you're right, it's absolutely not an overnight thing.
TRAVIS: Plus, also, the way that you build those powerful connections, and I know you know this. But I
want to illustrate it to everybody that's listening, is you've got to be accountable, you've got to be that
reliable person because what happens is you demonstrated trust and reliability long enough with these
guys, to where they're comfortable reaching out to another influencer and saying, "This guy Ryan's
solid. He's got a really cool thing going on here, I think you ought to check it out and maybe invest in
him." And that comes from being reliable, being accountable, being responsive, doing all of those
things that build trust and maintain your reputation. And you had to do those things over those 7 years,
not just make those connections but do those other underpinnings. Is that a fair statement?
RYAN: Yup, that's totally true.

TRAVIS: You can't be flaky and not follow-up, and not respond, and still have that type of reputation,
right?
RYAN: Yeah, exactly. A lot of people wonder, "How did you get so many followers on Twitter? And why
are so many people following you on Facebook?" And the only reason why is because I put myself in
this position of being an expert because I was on stage emceeing these events. I didn't know that was
going to work but man, that's paid big dividends.
TRAVIS: Good stuff. So, I had to ask you, I have yet to master the 4-day work week, okay?
RYAN: Right.
TRAVIS: So, I'm your student. I work way too many hours currently. Now, I know as an entrepreneur
when I want something done I schedule it. And I have a suspicion that that's what you have to do with a
4-day work week, is just schedule it and be done with, am I correct?
RYAN: Yeah. It's official for us, that's the only it happens, the whole company shuts down. I am very
purposeful with my schedule like you said. So what I do that works for me is I block out my entire day
with an appointment called focus. From 9 am to 6 pm, Monday, Tuesday, and Wednesday. I leave
Thursday open. And then whenever someone requests an appointment with me, what I'll do is I'll send
them a link. There's this great service, it's free, and I'm not associated with it at all but I love it. It's
called youcanbook.me. So, if you want to book an appointment with me, I just go, "Great, here's the
link, grab a spot that works for you." But people can only grab spots on Thursdays. And what that does
is it limits the damage to my doing time, that means I've got Monday, Tuesday, and Wednesday to deal
with the stuff that really matters. And that's been working really well for me. I don't know if you have
kids or not.
TRAVIS: Yeah. A son and a daughter.
RYAN: Yeah, so I've got 2 kids, and I think the discipline will start to get easier because I had that
epiphany that, well, the kids are definitely going to grow up and they're in that kind of acute phase right
now, they're 3 and 5. And I can tell that's going to just be gone.
TRAVIS: Right.
RYAN: So I'm sort of trying to remind myself every day, this going to be over. And then I've got 40
years to be by myself.

TRAVIS: Right.
RYAN: With my wife doing fun stuff. So, I'm just going to focus as hard as I can at not working on
Friday, Saturday, and Sunday, and that seems to be working. I still check email a little bit.
TRAVIS: Yeah. I thoroughly enjoy what I do so it's common for me to have my laptop in my lap,
watching TV, doing this. How do you steer around that?
RYAN: It's hard. I'm just like you, I absolutely love working. It's fun.
TRAVIS: I'm exhilarated by it.
RYAN: Yeah. And for a one time actually my wife and I would have fights because she would say, "You
don't have a hobby, you just work." And I was like, "Why? Work is my hobby, I love it. I don't want to do
anything else. Why is that bad?"
TRAVIS: So what do you do with that?
RYAN: Well, and for a long time I didn't have a hobby. And we would fight about it basically. And
something switched and I don't know what caused it but I decided to get fit. I was kind of your typical, a
little bit overweight. A little bit out of shape type of guy, sat down all day. And I just decided, you know
what, the one thing in my life I can't seem to control is my fitness, my weight, my strength, what is the
deal? At the time I was 34. For 34 years I let this demon stay on my back, and I don't know what
changed but I thought, "I'm done with this." And I had a nice watch at the point and I sold it. And I took
all the cash and I put it in an envelope, and I said, "I'm going to change my body with this money." And I
went to the gym and got a trainer. And every time I finished I pay the trainer in cash. And I did that for 3
months, and I think the way I got through it is I said, this is just 3 months. It was like hell, it was really
hard. But every time I thought, "I'm going to pay this guy cash at the end, I might as well work hard
while I'm here." And then at the end of the 3 months I saw these crazy results. I went from 24% body fat
to 12, I gained a ton of muscle, and I basically had a body that I actually liked looking at. And I was like,
"Whoa, this is insane."
TRAVIS: Right.
RYAN: And at that point fitness became my hobby, something I could do that wasn't work. So now I
work out 3 times a week for about an hour, and I eat right, and that seems to be something to do to
distract me from work, and I actually enjoy it a lot.

TRAVIS: Yeah, I've got to do a better job at finding balance because I'm thoroughly invigorated with
business. I love helping people. But I probably work 15 hours a day. But with little breaks, I take breaks
whenever I want to. I do what I want to, so it's really not like somewhere on the clock, right? But I'm
constantly working, I'm constantly writing. And I don't know that that's a healthy thing to keep doing.
And so, I really need to find a better balance there. I was just recently had a mastermind and we were
having some casual conversation. And one of the guys asked, "So what's your hobby?" And I couldn't
tell him anything. My business, I love doing what I do. Also, since that, that was not a good answer too.
RYAN: Right. I was in the same camp for a long time. I don't think it's an easy deal. We're lucky to be
doing something that we actually want to do all the time.
TRAVIS: Right.
RYAN: So, it's kind of a mixed blessing I guess.
TRAVIS: It is, it's a good problem, right?
RYAN: Totally.
TRAVIS: A lot of people have the reverse problem. They're working all the time but they don't enjoy it.
For me, really, I've wanted to pursue singing in a band on a more serious level. I don't need to make it a
financial thing but I feel more complete when I'm doing stuff like that. And really, if I pursued the lifestyle
that you're talking about I could do that.
RYAN: Yeah. I had this weird-- I think part of the epiphany was like I can pretty much control my life.
So, let's see what happens if I try to control things that aren't work-related. And I was tremendously
invigorated by being able to change my body. It was like, "Holy cow, this is the one thing I didn't know
you could do."
TRAVIS: Right.
RYAN: If you eat the right things and do the right things you can actually change your entire body. It's
like, "Whoa, that's crazy."
TRAVIS: Yeah, I've made the same shift. Now, it's so funny about being able to give ourselves
permission. So, I've been in a financial position to have a personal assistant for 15 years although I've
never done it. And I just recently hired myself, and this is kind of like what's wrong with me. How could I
let this get by me? There's so many things that I need done that make me happy. I like the

environment, my studio to be like a hotel, I like it to be immaculate, right? I like my cars to be
immaculate. But I don't like the time invested in me doing it, and so I finally gave myself permission to,
and this is silly, to hire somebody to do that. And I'm super excited about that, and I don't know why it
took me 15 years to come to a place where I gave myself-- I've got business assistants but never
personal assistants. It's just crazy. And I think that is in line with just sitting down, taking the time to
engineer the life that you want, right?
RYAN: Right. And I don't have a personal assistant, is that something you would really recommend?
TRAVIS: I'm very new into it but I love it. So we need to get a tire fixed I send her down for that, I send
her to get the car washed, all of those things. And it's not that it's beneath me, it's just when I'm taken
away from the stuff that I really like, or my highest value stuff. I rather be helping another entrepreneur
than getting my car washed, right?
RYAN: Totally, yeah.
TRAVIS: And so, I love it so far. And so, it's been a great experience.
RYAN: Alright. Yeah, I need to get on that.
TRAVIS: Yeah. So let's segue into-- you said something that I think scares the heck out of a lot of
people and sound like Greek, which is coding. And so, that average business owner's like, "Coding, I
haven't figured out all bells and whistles on my cell phone yet, much less doing some coding here." And
so, how does that transition into a business, and there's even part of your story is intertwined in that
with Treehouse and everything else that you've done. Can you take me down that path?
RYAN: Sure. So, basically the thought is that understanding and controlling technology is becoming a
core skill set in life that's as important as reading and writing.
TRAVIS: I agree.
RYAN: And so, basic things like, "How do I make a simple website? How do I make an iPhone app, or
an Android app? How do I make a web app like Twitter or Facebook?" Every business obviously needs
to understand this, or hire someone that does. So, what we do is we basically offer very straightforward
video training that presumes you know nothing and then takes you all the way to the point where you
can actually do these things. And we charge $25 a month for that. And we have now over 55,000
students around the world.

TRAVIS: Not too bad.
RYAN: Yeah, it's great. And if people want jobs then we also then take people who are job-ready and
then place them in jobs. So, that's the basic idea. And it really is possible. I have real students that
email me every month, and there's a guy named Russell that was an electrician. And he said that he
had signed-up for Treehouse because the recession was killing him and he basically couldn't pay his
mortgage. And he had had a son who was 3 at that point and he was freaking out. And then, he spent
about 4, 5 months learning in his free time before his son woke up or in bed at night. And now he
makes websites in his free time and makes enough money to pay his mortgage. You hear stories like
that, these are normal people, these are not Mark Zuckerberg.
TRAVIS: Right.
RYAN: People like Mark Zuckerberg intimidate me. I used to be a developer, I can't write any code
now, or I can but I don't do it commercially.
TRAVIS: So you don't need to be some geeky Mark Zuckerberg-type that enjoy or thrive in coding,
right?
RYAN: Not at all, in fact, most people are not. And what's exciting is that the amount of jobs and the
amount of companies that are now created around these technology are growing in a tremendous rate.
We're looking at, I think it's over a million unfilled jobs in development. And the United States just can't
produce enough of these people from college.
TRAVIS: Well, that's the learning curve, that's a problem. There's the gap of the unskilled versus the
skilled, right?
RYAN: Exactly.
TRAVIS: And so, help me understand, it sounds like it's a variety of verticals. So the $25 a month, you
could pick a vertical or-- how does that work?
RYAN: Yup. So we have what are called tracks. And tracks are like choosing a major in college. So our
tracks are web design, web development which is writing all the code that makes a website work,
iPhone, or Android, or WordPress. WordPress is a common thing that people use to run their websites.
So you basically just choose, "Hey, this is what I want to learn, or this is what I want to do." And then
we guide you step-by-step, you don't have to know anything.

TRAVIS: Oh, so it's just an evolutionary thing. Okay, so you've learned step 3, now let's go to step 4.
RYAN: Yeah, and if I was learning how to be a carpenter, I wouldn't know what tools to gather or where
to start.
TRAVIS: Right.
RYAN: So, I would need someone to say, "This is where you start and then here's what to do next."
And it's the same thing, but just for coding.
TRAVIS: So, let me anticipate how you built this. So you started with one vertical, let's say building
websites. And you setup training for that that maybe was a couple of months out and started
monetizing that. And then you added another vertical after that, is that how you went step-by-step?
RYAN: Sort of. What we did is we used-- So we had an idea. We were running this conference
company and we were doing conferences that had a thousand to two thousand people. They cost more
than a thousand dollars to attend, and we just thought, "You know what, we're not going to change the
world through this business. We're not going to reach enough people that we do reach are already
wealthy to some extent." We really want to affect millions of people who need help. So how do we do
that?
TRAVIS: Yeah, the lights scale, right?
RYAN: Yeah, we thought. Well, okay. Technology and learning how to control it are going to become
fundamental skills. So, why don't we just hire a teacher, put her in front of a camera, and film him. And
then put up in the web and charge 25 bucks a month for that.
TRAVIS: I like that.
RYAN: Yeah, and we used the cash flow from the events business to bootstrap it. And it was about
$150,000 to get the business off the ground. And I hired two guys, 1 developer teacher and 1 design
teacher and said, "Okay, we're going to give this 3 months to break even. And if it doesn't break even
we're going to shut it down." And then I sponsored my own conference, and launched it at one of my
conferences. And on day 1 we had 3,000 signups.
TRAVIS: Oh wow!
RYAN: And again, that's the seven years of work to get one overnight success.

TRAVIS: Overnight success, yeah.
RYAN: And then from there we hit break even very quickly with a tiny team. So we started scaling the
business, hiring more teachers, hiring video professionals, and then that moment happened I described
earlier where I showed the product to a guy named Kevin Rose and he said, "I want to invest in that."
And I was like getting blind-sided. I wasn't trying to get investment, I tried investment. But I thought,
"Wow, well that's interesting." So, at that point there's a real fork in the road. I thought, "Either I do this
investment, crazy venture capital thing that I've been reading about, or I just keep building my solo
business." And I decided, "You know what, I bet I'll learn a lot, and I bet the company will really grow.
Let's do it." So I decided to go the venture capital route.
TRAVIS: Any regrets with that?
RYAN: Only one. We've raised $13 million now and I do regret having to do the last round of the fund
raising we did. We raised an angel round of about $700,000 and then an A round of 5 million, and then
a B round of 7 million. And I wish we didn't have to raise that 7 million. I wish that I had been a little bit
more tightly controlled on our spending after the A round, because I think I could have gotten us to
profitability without doing that.
TRAVIS: Yeah.
RYAN: And so, we pretty much had to raise that 2nd round. And now we're growing like a weed,
thankfully, and it's going great. But yeah, I regret that because that diluted my ownership more. I still
own a very huge part of the business but it's a little frustrating.
TRAVIS: Yeah. Plus you're giving your-- I'm big on full autonomy. So, you're giving away some
autonomy there.
RYAN: Definitely.
TRAVIS: Most entrepreneurs don't like answering to people.
RYAN: Yeah.
TRAVIS: And that's what you're doing, knocking what you're doing because it is what it is. It's the
nature of the beast, right? We can't insist that dang zebra change its stripes. He is who he is, that's part
of the price that you pay with bringing somebody on. You can always buy back those shares at a later
time, right?

RYAN: Yeah. And there's been a lot of positives though thankfully. My investors have really pushed me
hard, not because I'm scared of them but just because-- It's kind of like playing, if you're shooting hoops
by yourself at a park, and then all of a sudden if you're playing in a big game and everyone's watching,
it kind of felt like that. All of a sudden I had all these eyes on me and I needed to perform. Not because
I'm worried they're going to fire me or they're going to sell the business or something. It's like, "Wow,
these guys have put in millions of dollars." And I want to absolutely smash it for all of us. So it's been
good. And they connect me these insane people like, I got connected to the CTO of America who sits
next to Barrack Obama, and all these kind of things because of the investors. So, that's always good.
TRAVIS: Well, you know, they force you to raise your game. It's even like being in a really high level
mastermind. When you start hearing what's going on behind the scenes with other people you're like,
"Holy cow! Man, I need to get out my way here."
TRAVIS: And so, there's a lot to be said about playing with people that are much higher than you. It
fast tracks everything about what you're doing.
RYAN: Totally, yeah.
TRAVIS: So let's see. So doing the numbers here. 55,000 people, $25 a month. That's a 1,375,000 a
month, right?
RYAN: Yeah.
TRAVIS: That alone, is that your only stream? And I don't mean only in a trivialized way. But is that
your only stream or are you guys monetizing other ways also?
RYAN: No, that's it. People just straight up pay us, and some of those folks are even paying $50 a
month. It depends, there's 2 plans, there's a basic and unlimited plan, so--
TRAVIS: Okay. So, what's your total weight like, $35 or something like that?
RYAN: Yeah. It's great, and it's a great business because it's recurring revenue. I specifically chose to
do that. My last business was one time revenue, and I just felt like I had to go out and kill what I was
going to eat again, and again, and again. And I thought, "You know, if I can build a recurring revenue
business, life will just be so much nicer." And it is. I'm very thankful we made that choice.

TRAVIS: Yeah and that's why I'm kind of pulling this apart because my first couple of businesses had
the same problems that you talk about. Number 1, we were hamstrung by being able to scale. We
couldn't handle a thousand new customers or clients tomorrow, where you could. And so you've got
scalability there, and then also we're always working our self out of business. We'd sell it and go do it.
And if you're not careful about continuing that pipeline, the pipeline can go dry.
RYAN: Exactly.
TRAVIS: So your business model completely eliminates those issues there. And how long do people-- I
don't want to cross the line and I know that there may be some things that you just don't share publicly.
And if I ever ask those questions just let me know. How long do people normally stick with you
whenever they become a client?
RYAN: You know, it does depend a lot. And that's one thing we don't share very much publicly. But,
you know, for a decent amount of time. That is the one factor though that affects our business the most.
And we call it attrition, how long do you stay with us. And we work very hard at that. Because we can
dump people into the top of the funnel, and thankfully we're doing that and it's going very well. But how
long they stay is absolutely the key metric that changes our business.
TRAVIS: Yeah. It's just math. You've got to have more people coming in and staying than are leaving.
So you've got to watch that attrition rate. So, industry norms for a reoccurring continuity model like that
is 3 months, and I bet you guys probably have a much longer cycle than that.
TRAVIS: Yeah, very cool. Now, something else that was really interesting. So, the DropSend was
acquired on 2011, is that correct? No, 2008, I'm sorry.
RYAN: 2008, yeah.
TRAVIS: Yeah, I'm sorry, 2008.
RYAN: It was my events business that was acquired in 2011.
TRAVIS: Yeah. Carsonified?
RYAN: Yup.

TRAVIS: Okay. So, the DropSend was that a different connotation of the business that went out of
business?
RYAN: Exactly. Yeah, it was the resurrection of a failed business. And man, that worked. It was
interesting to see how we basically took a model where I had to sell big subscriptions at 300 bucks, or
500 bucks a month that said, "Let's just make it 3 and then ask people to pay if they want to send more
than 5 files a month. And we'll charge them 5 bucks a month." And that really worked. And that
business ended up growing to about, I think it was about, we did about half a million a year in revenue.
Not something crazy but I've had zero time working on it. It literally ran itself. And I just though, either I
dig into this and I go for it or I sell it. And I just realized I'm not passionate about sending files long term,
it's just not a business I really care about. So, it's better to sell it.
TRAVIS: That was pre-Dropbox also, wasn't it?
RYAN: It was. And you know what's ironic, the product was actually called Dropbox before Dropbox
was out. But we couldn't get the trademark, which was interesting, in England. So, we changed it, and it
went from there. So, that was interesting.
TRAVIS: Was that DropSend available over here, I want to say that I was a client of that because--
RYAN: It was, yes. It's definitely worldwide.
TRAVIS: Yeah, because I had sent a couple of three large files and then I needed to send more and
that was the model. After you reach 5 or something you had to pay for it. And I paid for it.
RYAN: That's awesome. You probably paid me 10 bucks or something.
TRAVIS: That's right, yeah. I'm responsible for your success, right?
RYAN: I appreciate that. When I learned though, I got screwed on the sale of that business. And what's
interesting, the reason why is I just didn't know what I was doing. And I'm sure you've seen this and a
lot of the listeners who have sold a business know this is that it's all about whether you need to sell or
not. And I needed to sell that business. And so, I found one buyer, and he figured out that I needed to
sell. And then it was over.
TRAVIS: Leverage's lost.

RYAN: And what I found interesting is that he used this trick on me. I have to tip my hat to him because
it was pretty clever. And what he did--
TRAVIS: I guarantee you; he forced you to tip your hand didn't he?
RYAN: Yeah, he did. And he also used this trick where he said, "You know what, here's what this
business is worth, this is the best that I can do." He gave me a figure, and it was about $400,000. And I
was expecting a million, so I was just flabbergasted at that point. And I said, "That's just not going to
work. That's barely our yearly revenue. That's not even a 1x multiple." And this is a recurring revenue
business that requires zero effort, that's crazy. So, he said, "You know what, let me go talk to my board
and I'll try to convince them." And he didn't have a board, there was just him.
TRAVIS: Right.
RYAN: And so, all of a sudden he kind of created this feeling of like he's the good guy.
TRAVIS: Working with you.
RYAN: Yeah, trying to get me the best deal. So he came back and said, "Alright. Well, the board is
saying they can't do anymore but I'm going to push them hard and I think we can get you at 425." And I
believed it. And I kind of thought that's the best deal that I could get.
TRAVIS: You were just paying for a lesson; you were paying for your lesson right there. And so, that
sales 101. The guy's saying "Ryan, I'm with you. I'm all in, I think DropSend is incredible. It's not me, it's
these guys, but bear with me. I'm going to get another 45,000 out of them."
RYAN: I know. And I kind of laughed once I figured it out, but, well alright. You got me.
TRAVIS: Yeah. As soon as you bid he knew that he had you, right?
RYAN: Yeah, exactly. So, it was all-- But in the end I was like, "Well, hey, half a million bucks, not bad."
TRAVIS: Yeah.
RYAN: I'll take that. And we ended up putting that most of the money back into the business, which
eventually got us Treehouse. So, it worked out.

TRAVIS: Yeah. Well, I think that's very-- I really appreciate how open and candid you are because you
and I talked about this. It's so illustrative for other people to hear our "Uh-oh's" our mistakes, and what
we learned. And hopefully you can learn from them through our stories rather than experiencing them
yourselves. Although unfortunately, quite often, you have to learn it through experience yourself, right?
TRAVIS: A lot of times you need to lose that sum of money before it completely sinks in.
RYAN: Yup, exactly.
TRAVIS: You don't need to learn that lesson ever again, do you?
RYAN: No.
TRAVIS: Yeah. I had a guy one time. I swapped him for something on a project, and really, he said,
"Mark this paid in full for me." And it was just for the one item, right?
RYAN: Sure.
TRAVIS: I marked it paid in full and then when I come around to get paid on the big portion of the
contract, he got the old contract out and he said, "Travis, you marked this paid in full."
RYAN: Oh gosh, that's pretty bad.
TRAVIS: Yeah. And right then I just realized that I just purchased myself an education.
RYAN: That's a good way to look at it.
TRAVIS: And it was a time where I really couldn't afford to do without. I was thinking I had an "Oh shit
moment." How am I going to explain this to my wife, you know. And I was tempted to pick him up and
shake him, but I thought, "You got yourself into it, own it. It's a lesson." If you had to start over today,
knowing what you know. I love the fact that you're not a quitter. You get up, you dust yourself off, you
move on. Knowing what you know now, if you had to start all over, what would you do differently, if
anything?

RYAN: I would definitely learn basic accounting sooner. I was very cavalier about how the P&L, and
balance sheet, and cash flow, the actual documents worked. And I thought, "Oh, the accounts. They'll
figure that out," which is absolutely stupid. It's the report card for your whole business.
TRAVIS: It's the windshield.
RYAN: I know, it's insane.
TRAVIS: It's where you drive from, right?
RYAN: So, looking back at that I was thinking, "Well, that was silly." And maybe that's because I didn't
study in business in college, I don't know. And that hurt me pretty bad on the sale of my second
company just because something as simple as understanding the balance sheet and realizing, "Hey,
they're going to knock this off the price of the company." We had some stuff on there that I didn't realize
and essentially it was payments received in advance that is essentially a liability.
TRAVIS: Right.
RYAN: And I didn't get that. So, that was harsh. So that was one thing. I think I would've abstracted
myself from my first business a lot sooner. I don't have any plans to sell Treehouse. I want Treehouse
to be a 100-year company worth billions of dollars. I don't want to go anywhere with it. But, my previous
company is I had a really hard time selling them because I was so involved in the business. And at
Treehouse, Treehouse runs itself. I very much provide guidance and leadership, and kind of moral
support, but I don't do anything every day. And our customers don't see me as the company. So, I
should've done that much sooner. Even with the name Carsonified, it was my last name. That was
previous company, so-- Those are a couple of lessons I've learned.
TRAVIS: Right. Excellent point. So listen, we're running a little long on time. Are you ready to transition
to the lightning round, do you have your seatbelt on right now?
RYAN: Yup, let's do it.
TRAVIS: Yeah. Do you need to drop down and do any push-ups or anything to get pumped up for this?
Or can you just transition just at will?
RYAN: That's good.

TRAVIS: What book or program made an impact on you related to business that you'd recommend and
why?
RYAN: How To Win Friends and Influence People, by far the most valuable book I've ever read. And
it's been key to really understanding how people tick and why they want to do things. So that's been
key. The second is a book called Maverick, which is about a big company in Brazil called SEMCO. And
it's even crazier than our culture. People think, "Hey, you don't have managers at Treehouse, you don't
work Fridays," well SEMCO is even crazier. Everybody chose their own pay, they hired and fired
people without any approval from anybody above, it was just crazy, but it was a huge company and I
learned a lot from that book, it's really inspiring.
TRAVIS: I'm excited, I've never heard of that one. So it's just called Maverick?
RYAN: Yup, Maverick. It's by a guy named Ricardo Semler and the company was called SEMCO. It's a
great book.
TRAVIS: Alright, I'm excited about that. And the first book, How To Win Friends and Influence People is
a misleading title because it's an excellent book. It sounds very selfish but it's really not.
RYAN: Yeah, it sounds like you kind of feel bad reading it but it's a classic. I think it was written in the
30's by Dale Carnegie, and I'm sure you've read it. It's just so good.
TRAVIS: Yeah, definitely. I think you mentioned it earlier. What's one of your favourite tools or pieces
of technology that you've recently discovered, if any, that you'd recommend to other business owners?
RYAN: I think something as simple as Google Apps. We run our whole business infrastructure, email,
calendar, Google Hangouts, on Google Apps. And it's basically free, so we don't have to use Outlook.
It's unbelievable.
TRAVIS: I do too, I agree with you.
RYAN: Cool. So that's pretty basic but helpful. The other thing I really like is called Asana. And it's a to-
do list manager, and it's just great. It's powerful yet simple. And another really cool tool is called Trello.
It's really a project management tool but it's in this unique vein of project management called Kanban,
and it's a really cool. We used it for a long time at Treehouse.
TRAVIS: Excellent. What famous quote would best summarize your belief or your attitude in business?

RYAN: It's a quote by Steve Jobs but I'm going to summarize it because it's more kind of a couple of
paragraphs. He basically said, “We are raised to believe that we’re supposed to walk down this hallway
and not bump into the walls very much, or break anything. But the truth is there is no walls, there's no
rules, and the people that are creating your reality know that.” And I just thought it's so true. It's kind of
astonishing how much we believe the rules of the universe. And the more you dig into them you just
realize, "Gosh, most of these things aren't even real." There are things we stick to, to become
comfortable and to have some sort of normalcy in our life but it really is an open book, which is
terrifying and exhilarating, you know.
TRAVIS: Yeah, I completely agree with you. And they're so binding that they even dictate how you live,
and quite often, whether you live or die in some cases.
RYAN: Yeah, and a real practical example is just that I look at most CEO's and they kind of work
themselves ragged. And they don't seem to even take advantage of this basic ability to control their
schedule. And part of that is down to sort of feelings of-- For instance when I go to the gym during the
day and my team is working, there's a part of me that feels guilty about that. Is it really okay for me to
be at a gym right now? My team is working. And then I realize, I started this company and that gives me
the right to control my schedule. I paid the price with stress and risk, and that equals control. So, I
should take advantage of that. So that kind of mentality is something I regulate and try to stick to.
TRAVIS: Yeah, I completely agree with you. I come from such a tough background that almost
everybody I grew up with is either on drugs, dead, or a policeman.
RYAN: Wow.
TRAVIS: And so it's a very, very tough neighborhood. And for some reason I was born with the belief
that I could do it. Or I think I was born with it, or somehow, for some reason I believe that I could. And
so, I was able to build incredible business without a special DNA, and without schooling. Now, I had to
get education later but I did it without going the certain route. And all of that is attributed to my attitude
and my belief.
RYAN: Why do you think you're that way? Because I've been trying to figure out, what do I feel like
this? Mainly, so I can try to pass on some of this mentality to my kids. And I haven't figured it out why I
have this outlook.
TRAVIS: I think about that a lot. And I don't know, this may be too old for you to remember. Do you
remember Robin Leach's Lifestyles of the Rich and Famous?

RYAN: Yeah, totally.
TRAVIS: So, I'm growing up in the hood where there's gunshots every night. And watching the show,
and I'm so confident that I'm going to be successful that I get excited watching the show because I
know one day that's going to be my future. And it was an intuition, it was a level of confidence, and I'm
puzzled by that because I don't quite understand it. And I've been on a journey to understand that and
also to deserve the things that I've had in my life. But I don't know that answer. I was just born and ate
belief that I could, and I had a few small successes, personally on personal levels early on. And I just
realized that I can fabricate my future.
RYAN: Got it. Wow!
TRAVIS: And just built on it from there. So it's kind of a very strange thing.
RYAN: You know, that's awesome! I think it's really to my dad telling me a lot he believed in me, but I'm
not sure. I'm sure that helped but, I don't know.
TRAVIS: It definitely helps to have people nurturing around you and planting that seed. I think that, that
can overcome people that weren't inherently born with it. The nurturing is extremely powerful. One
thing, and I've been so enthralled in your story and all of the different directions here. I wanted to get
one of the piece of wisdom from you. In what you teach, how many verticals are there? Is there too
many to mention right now?
RYAN: Not really, it's basically web design, web development, and then iPhone development, and
Android development. That's kind of the tops it's into. Yeah, apps is a good way to think of it.
TRAVIS: Okay, alright. And so, what are the top 5, just off the top of your head. It could be 3, 4, 5,
whatever. What are the top 5 misconceptions that prevent people from taking the necessary steps to
taking your course, and learning these things, and creating an income? Manifesting their future, right?
RYAN: I think the main thing is just dedicating a little time every day. It's just like going to the gym.
Anybody can do it. It's just carving out that little bit of time every day to get it done, and that is the only
hurdle. You don't have to be great at math, you don't have to have a high IQ.
TRAVIS: So people don't think I need to be coder, I need to have some background in coding.
RYAN: Not at all. And actually, some of the most talented developers we've ever seen are poets, or
English majors. People that have this creative ability to think in creative, abstract ways. Because really,

coding is just solving problems. How do I use technology to solve this problem? And that's all there is to
it. So, a little bit of dedication, anybody can do this.
TRAVIS: It's funny you say that because I think that's been the secret to my success. I once mapped
out something that I was thinking, and I mapped out a way to reference certain things when certain
things happen. And I showed it to a guy that designed programs, and he said, "Where did you get this?"
And I said, "Well, it's just the way I think of things, because this is coding. This is a form of
programming here." I'm a creative thinker, and so I like the fact that you're saying you don't need to be
this geeky guy, that's a mathematical wizard or anything else, It's just that you're a creative problem
solver.
RYAN: Exactly. And all of a sudden you can solve all sorts of problems, which is really exciting.
TRAVIS: Cool, I love it. Excellent. So how do people connect with you and learn more about doing this
for themselves.
RYAN: They just head to our website at teamtreehouse.com, or tribute email,
ryan@teamtreehouse.com, or hit me up on Twitter, I'm just @ryancarson.
TRAVIS: Cool.
RYAN: And I'm happy to help anyone, or point them in the right direction. We have a free 14-day trial.
So you can just try Treehouse totally for free, and if you don't like it you just cancel. So hopefully people
check it out.
TRAVIS: Man, excellent story, excellent interview, a lot of great information to think about. I appreciate
you being so open and candid with sharing your stumbling blocks along the way to success.
RYAN: No problem Travis. I'm thankful you've got a show where folks can share what they've learned.
Because I wouldn't where I am today if other entrepreneurs hadn't shared. So, it's great to be on the
show.
End of Interview

TRAVIS: Thank you so much for that, I really, really appreciate it. Listen, I want to remind you that you
can go to rockstarentrepreneurnetwork.com and we've got show notes there, we've got links,
everything that we've talked about in the show. That if you want to reference them, the books, there's a
quick and easy way to find them right there in the show notes. Now, do you remember at the beginning
of the show I've asked you a question? And the question was do you have a company that you
compete with, that they always seem to be doing well. Even though their prices are higher than yours,
maybe extremely higher than yours. And maybe it's not just their prices, what they offer is not as good
as what your company offers, yet they're always still super busy. Now, can guarantee you 90% of the
time, the secret to their success is what I call the iceberg effect. And what it means is there's a system
going on behind the scene that happens on autopilot. Now, once we figure this out I was able to
increase our prices on the services that we offered, and this shifted our business to making profit
margins of 800% more on each and every job than what we used to make previously. This is what I use
to build several, tiny, little, local companies to multimillion dollar businesses. Now, of that sounds
interesting to you and you want to learn how to do things like the iceberg effect, then join this
sweepstakes, the $73,000 Sweepstakes. You'll have a chance to win the 73,000 in cash and prizes.
Plus, I will personally mentor you, and there's a whole host of things that you win in that package. Plus,
you'll have a chance to win my personal Lamborghini. As always, go to
rockstarentrepreneurnetwork.com, if you'll look at there, there's an orange banner across the top of the
website. Just click on that and it'll take your directly to the show. Now, my quote for today comes from
Winston Churchill, and the quote reads, "Success is walking from failure to failure with no loss of
enthusiasm.” This is Travis Lane Jenkins signing off for now. To your incredible success, take care my
friend.

How We Can Help You
We know that finding someone that you can trust online today is hard and that so many “so called
gurus” are self-‐appointed and have never really even done what they teach you to do. That’s exactly
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And you are too emotionally involved to completely impartial.
This is a common problem for EVERY business owner. It doesn’t matter if you are a one-man army, or
an army of 150, the problem is still the same.
Travis Lane Jenkins
Business Mentor-Turn Around Specialist
Radio Host of The Entrepreneurs Radio Show
“Conversations with Self-made Millionaires and High-level Entrepreneurs That Grow Your Business"

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