YouSaid · the spoken record

Scott Orn

lines on the record
29
first
2024-12-12
most recent
2024-12-12
sittings or episodes
1
sources
podcast

Every line below is reproduced as it was said and linked to the record it came from. Nothing here is summarised or generated. Directory · Search · Corrections

  1. “Look, you got a guy like Scott sitting there. He's got the sweater on. He's got the three quarter zip. You can take him seriously. Counton shows up with the three quarter zip. You know they're here for business. They got the college shirt under it. No longer suits. You don't have to wear the suits and ties, but you do have the three quarter zip, you look great. You come in, you teach these people how to do it. I love you for it, Scott. Thank you for doing it. It's great to see you again. And we'll get some ramen soon. Everybody, once again, this week in startups.com basics. We'll see you next time. Bye bye.”

    2024-12-12 · This Week in Startups · The Top 6 Startup Finance FAQ's | Startup Finance Basics w/ Kruze's Scott Orn · IDENTIFIED FROM THE TRANSCRIPT · source

  2. “Do our chores, and you know what? Do your chores, keep the house clean, it's like, it's just good discipline to have. It's good hygiene. If you brush your teeth, you clean the dish. The dish is in the sink. This is the same thing. Accounting legal HR, just get it right. I always tell people, Scott, tight is right when it comes to B's particular items. You can play games with your design, UX. You can have fun, be creative. We don't need your creativity applied to accounting, legal, or HR.”

    2024-12-12 · This Week in Startups · The Top 6 Startup Finance FAQ's | Startup Finance Basics w/ Kruze's Scott Orn · IDENTIFIED FROM THE TRANSCRIPT · source

  3. “All right, listen, great job, Scott. You clean up all these messes I give to you and you're just so generous with your time, especially to the two or three-person companies, which I really appreciate your true mention. Cruise Consulting.com slash twist if you want to work with Scott. He's my guy. And if you want to watch all the startup basics and just check them off so that you know you're doing things right this week in startups.com slash basics. I know people don't like to do chores, Scott, but we all have to do our chores.”

    2024-12-12 · This Week in Startups · The Top 6 Startup Finance FAQ's | Startup Finance Basics w/ Kruze's Scott Orn · IDENTIFIED FROM THE TRANSCRIPT · source

  4. “Mob loses 3 million. You are going to get some cement shoes. And then they're somewhere in between. In other words, they take it seriously and they say, okay, here's a foreclosure document. We will extend it, but we now want 250k in warrants. We now want a million dollars in warrants. And then you have no choice but to give them whatever they want. And it can be a little brutal, yes, Scott?”

    2024-12-12 · This Week in Startups · The Top 6 Startup Finance FAQ's | Startup Finance Basics w/ Kruze's Scott Orn · IDENTIFIED FROM THE TRANSCRIPT · source

  5. “If you have it there as a rainy day fund, you're raising a $10 million Series A, some bank offers you a $3 million line that you can draw down in three tranches and it's $50K to set it up or $100K to originate it. Okay, do you want to spend one percent of your cash reserves to have $3 million available in origination fees or whatever? Maybe. Maybe. Much better to either not have it or to have it be a small amount because I can tell you if it goes wrong This is going to blow up in your lap. And these folks are not, I wouldn't say they're like the mob, but they're not angel investors. Angel investors are investing their own money. If they lose 25K, they lose it.”

    2024-12-12 · This Week in Startups · The Top 6 Startup Finance FAQ's | Startup Finance Basics w/ Kruze's Scott Orn · IDENTIFIED FROM THE TRANSCRIPT · source

  6. “They will call your investors. Kind of like trying to pull one over on the real estate broker community. Like they bought and sold your house three times before you bought and sold it. They know your house better than you do. They know the two previous owners. They know who's going to buy it. Venture debt is not something they're never going to catch the knife. And I think the big mistake is when people add on too much of it and they use it as runway.”

    2024-12-12 · This Week in Startups · The Top 6 Startup Finance FAQ's | Startup Finance Basics w/ Kruze's Scott Orn · IDENTIFIED FROM THE TRANSCRIPT · source

  7. “Should I raise venture debt when I raise my Series A? Huh? We put a little caveat there. Should I raise venture debt series A? I haven't looked at your notes. Scott, I'm interested in your thoughtfulness here.”

    2024-12-12 · This Week in Startups · The Top 6 Startup Finance FAQ's | Startup Finance Basics w/ Kruze's Scott Orn · IDENTIFIED FROM THE TRANSCRIPT · source

  8. “My line item for podcast revenue is not in the IRR of our fund. That's a separate line item. The end. Full stop. All right. Love it. We're in agreement. Strong agreement.”

    2024-12-12 · This Week in Startups · The Top 6 Startup Finance FAQ's | Startup Finance Basics w/ Kruze's Scott Orn · IDENTIFIED FROM THE TRANSCRIPT · source

  9. “And they just found this little piece of information. I was like, well, that's pretty freaking savvy, isn't it? But the truth is, like, if the company had been successful, they wouldn't have done it. You just gave an option to somebody to get their money back. And none of us expect perfection anyway. So, if you got $100,000 to build somebody's website and then their website linked to your SaaS product, but they wanted you to build the website as well, and that kept the lights on, we understand. Keep the lights on ourselves. Listen, I'm here doing podcasts. You know, it's not to keep the lights on, but it is a revenue stream. We get it. There's another line item of revenue. Just treat it as such.”

    2024-12-12 · This Week in Startups · The Top 6 Startup Finance FAQ's | Startup Finance Basics w/ Kruze's Scott Orn · IDENTIFIED FROM THE TRANSCRIPT · source

  10. “I'll give you an example. Somebody in our portfolio, we got a complaint from somebody who had put 50K in the company was going out of business and they went back to the deck and there were things in it that they said that weren't true. One of them was that this person was on the team. That person was not on the team. This really savvy angel investor said, You lied to me during the fundraising process. I'm about to send this to the SEC for securities fraud unless you send me my $50,000 back right now. I will give you till the end of the day. Founder scared to death sent the money. That was the only investor who got any money on the company.”

    2024-12-12 · This Week in Startups · The Top 6 Startup Finance FAQ's | Startup Finance Basics w/ Kruze's Scott Orn · IDENTIFIED FROM THE TRANSCRIPT · source

  11. “Times I mean, people don't understand this, but if you are making false representations, false would be knowingly or inaccurately because of your own stupidity or thought or you're just not tight, either of those combined with selling securities, there's an interesting word for this, securities fraud. You may not think you're committing securities fraud. You may think that's somebody trading shares in a company with inside information because their cousin works at Netflix. Okay, that's insider trading. When you're selling a security, it means your private company sold some shares to why Combinator, to launch accelerated tech stars, or to an angel. If something in that deck is not quite right and it's material, you don't really have a leg to stand on. That person can just say to you, I'll take my money back where I'm going to sue you.”

    2024-12-12 · This Week in Startups · The Top 6 Startup Finance FAQ's | Startup Finance Basics w/ Kruze's Scott Orn · IDENTIFIED FROM THE TRANSCRIPT · source

  12. “Totally makes perfect sense. All right, we are cruising through these frequently asked questions. So can I tell VCs that implementation revenue is ARR? So implementation revenue is ARR.”

    2024-12-12 · This Week in Startups · The Top 6 Startup Finance FAQ's | Startup Finance Basics w/ Kruze's Scott Orn · IDENTIFIED FROM THE TRANSCRIPT · source

  13. “Angel investors and early stage investors like myself, we do like to know the cash. So maybe tell us about, you know, as quickly as possible accrual versus cash-based.”

    2024-12-12 · This Week in Startups · The Top 6 Startup Finance FAQ's | Startup Finance Basics w/ Kruze's Scott Orn · IDENTIFIED FROM THE TRANSCRIPT · source

  14. “And then you have to have cancellation terms. If you cancel 90 days notice. So if they cancel in month three, then they stop paying in month seven and you have time to offboard them and whatever expense you put into it, you're golden. And big companies, they're used to this kind of thing. They'll deal with it. Sometimes their CFO or accounting department will call you and try to grind you and you say, well, no, when I talk to them, I gave them a discount. Oh, well, it's not our policy. And you say, yeah, but I gave them a discount. So if that's not your policy, our policy is you got to pay 60K, 5K a month if you want the discount. We need the 50K. And they'll make their own decision as to what they want. You can use any number of platform Sripe, QuickBooks. You know, there's bill paying platforms everywhere, just like there are HR platforms everywhere.”

    2024-12-12 · This Week in Startups · The Top 6 Startup Finance FAQ's | Startup Finance Basics w/ Kruze's Scott Orn · IDENTIFIED FROM THE TRANSCRIPT · source

  15. “Totally. And one of the things I always encourage founders to do is if you're giving a discount, then you have the high ground. Hey, I'm going to give you this two months free, but you got to pay for the year up front.”

    2024-12-12 · This Week in Startups · The Top 6 Startup Finance FAQ's | Startup Finance Basics w/ Kruze's Scott Orn · IDENTIFIED FROM THE TRANSCRIPT · source

  16. “There you go. All right. Question number four. We get this one a lot. Hey, I just sold a customer. I told him it'd be $50,000 to use our software for a year. It's going to be $5,000 a month. I'm going to give them a discount. They negotiated me down to 50. What do I do now?”

    2024-12-12 · This Week in Startups · The Top 6 Startup Finance FAQ's | Startup Finance Basics w/ Kruze's Scott Orn · IDENTIFIED FROM THE TRANSCRIPT · source

  17. “Because the founder learned a bunch on the first turn. You can burn the boats, but you can't burn your team and investors. Very simple way to think about it. Number three.”

    2024-12-12 · This Week in Startups · The Top 6 Startup Finance FAQ's | Startup Finance Basics w/ Kruze's Scott Orn · IDENTIFIED FROM THE TRANSCRIPT · source

  18. “This is why some people like to award days at the beginning of the year as opposed to having people accrue them. It's a little technical, but people can either get 1.2 vacation days a month for every month of service. That's accrued. That means you earned it. That means it has to be paid out if you shut the company down or the person leaves. They get that. They earned it. If it's awarded, you get 17 days a year, including your floating holidays, sick days, personal days, vacation days, whatever it is. The person could take them in the first three months. leave the company and then you're like, oh, that was a bummer. They took three weeks off and they left the company. And you know what? There are angle shooters who do this kind of nonsense. I see it all the time and I'm like, oh God, wow, you got me for two weeks of vacation and then quit. I mean, who cares? At the end of the day, career-wise, it doesn't matter to me or for the companies, but that's why some people do the award the days. Yeah, so they don't build up this liability on their books.”

    2024-12-12 · This Week in Startups · The Top 6 Startup Finance FAQ's | Startup Finance Basics w/ Kruze's Scott Orn · IDENTIFIED FROM THE TRANSCRIPT · source

  19. “And you know what? We're adults. We've been through this. We expect 80%, 50%, you know, depending on what stage you're in to go to zero. So when something goes to zero, it frees you up to do your next company and pitch us on that and maybe we go on the next adventure with you”

    2024-12-12 · This Week in Startups · The Top 6 Startup Finance FAQ's | Startup Finance Basics w/ Kruze's Scott Orn · IDENTIFIED FROM THE TRANSCRIPT · source

  20. “They could know that. And yeah, we're selling all the laptops. We're selling all the equipment. We're selling the domain name. And whatever's left, we'll go to shareholders. There's a million dollar convertible note at the end. We expect if we sell everything, it'll be 100K. That 100K will go to the people who are the last note holders. You were in the seed round. You're not part of the last group of people. If there's any money, they get it first, so you can expect that nothing's going to be trickling down to the seed round. Boom.”

    2024-12-12 · This Week in Startups · The Top 6 Startup Finance FAQ's | Startup Finance Basics w/ Kruze's Scott Orn · IDENTIFIED FROM THE TRANSCRIPT · source

  21. “And transparency goes a long way. Hey, we tried, it didn't work out. Here's a little narrative of what we tried and why we think it didn't work out. We really appreciate everybody. Here's when you're going to get to take the loss. You know, we're wrapping things up in 2024, but you'll be officially taking the loss in 2024.”

    2024-12-12 · This Week in Startups · The Top 6 Startup Finance FAQ's | Startup Finance Basics w/ Kruze's Scott Orn · IDENTIFIED FROM THE TRANSCRIPT · source

  22. “And so use a payroll company and have experts. All right. This is the time of year also when a lot of founders start thinking about shutting their company down, Scott. What's the process for officially shutting down a company? And how long does it take and what does it cost typically to do this? Yeah.”

    2024-12-12 · This Week in Startups · The Top 6 Startup Finance FAQ's | Startup Finance Basics w/ Kruze's Scott Orn · IDENTIFIED FROM THE TRANSCRIPT · source

  23. “Employment situation here in the United States is kind of binary. You're either full time or you're a contractor and there should be something in the middle. There should be like a contractor that if they hit a certain number of hours a year, let's say a thousand, you know, which would be halftime, something happens where they contribute some amount of your taxes, some amount to your healthcare, whatever. Anyway, we could debate all this. What we think is right, just do what's right in your state. And man, I got to tell you, these payroll companies are very sophisticated.”

    2024-12-12 · This Week in Startups · The Top 6 Startup Finance FAQ's | Startup Finance Basics w/ Kruze's Scott Orn · IDENTIFIED FROM THE TRANSCRIPT · source

  24. “They used to be like a test where you could go down this test, and what people need to understand is like a lot of those tests that you see online are not actually legal tests, they're guidelines. And so you need to work with a professional if you're going to do anything close to the line. And my perception is this is very much state-based in addition to federally based. And there's interpretation. And if you're anywhere near the line, you might as well just withhold tax unless your entire business is predicated on this like Uber and Lyft and DoorDash's, in which case they have unlimited resources and in-house counsel to negotiate and lobbyists. I mean, that's the level it got to with an Uber, a Lyft, a DoorDash. They literally had lobbyists making sure. And I'm going to be honest.”

    2024-12-12 · This Week in Startups · The Top 6 Startup Finance FAQ's | Startup Finance Basics w/ Kruze's Scott Orn · IDENTIFIED FROM THE TRANSCRIPT · source

  25. “What are the circumstances where you hire a freelance designer who has a company they're going to work for you for over six weeks to do a 50-hour project? Would that be okay to just pay their LLC? They send you an invoice, you pay them, and you don't withhold the taxes.”

    2024-12-12 · This Week in Startups · The Top 6 Startup Finance FAQ's | Startup Finance Basics w/ Kruze's Scott Orn · IDENTIFIED FROM THE TRANSCRIPT · source

  26. “Literally said that, and I was like, I went to the lawyers. I was like, wait a second, employment lawyers, we did everything right. And they were like, yep, I'm like, how much is it going to cost to fight this? And they're like, you'll win if you fight it. It's going to cost $30,000, maybe 50, depending on how many times we go back and forth. I'm like, well, what are they asking us to pay? They're like $8,000. Like, so we pay the eight, even though we're in the right. Yep. So, even if you're right, the cost of dealing with this is just incredibly high. The reason the government, correct me if I'm wrong here, Scott, wants people to pay their taxes and not do this 1099 stuff is if you were allowed to do this, everybody would do it.”

    2024-12-12 · This Week in Startups · The Top 6 Startup Finance FAQ's | Startup Finance Basics w/ Kruze's Scott Orn · IDENTIFIED FROM THE TRANSCRIPT · source

  27. “This concept that everybody's going to be 1099, you're just going to give them cash is always a mistake. I got to tell you, half the time you do this, you will wind up having somebody claim that they thought you were withholding their taxes, and then they want you to pay them. And by the way, in some jurisdictions, man, I have been up against it in some jurisdictions with different companies, and they'll just be like, literally, in one case, the tax board just said, listen, you're a rich company. I just Googled you. You raised 20 million. Just pay the taxes for this person”

    2024-12-12 · This Week in Startups · The Top 6 Startup Finance FAQ's | Startup Finance Basics w/ Kruze's Scott Orn · IDENTIFIED FROM THE TRANSCRIPT · source

  28. “Let's talk about some of the most common founder startup questions we get. The first one we should do is how can I avoid paying payroll tax as a startup founder?”

    2024-12-12 · This Week in Startups · The Top 6 Startup Finance FAQ's | Startup Finance Basics w/ Kruze's Scott Orn · IDENTIFIED FROM THE TRANSCRIPT · source

  29. “Hey everybody, welcome back to this week in startups. We're doing our startup basic series. It's a very simple series. You can go to this week in startups.com slash basics to see all the different episodes we've done. This is where we work with some of our top partner service providers, accountants, legal, and HR talent to help you founders make sure you're doing things right and tight is right with me again, my pal Scott Orn. He's the COO over at Cruise Consulting with AK. There are CPA. They focus on VC-backed startups. They've got tons of our portfolio companies as clients, including Podcast AI. They're doing great. They have revenue. They raise money. And then a couple of our legendary startups like Superhuman and Calm started with Cruz and then graduated because, hey, they became really big companies and Cruz likes to work with the emerging ones. How you doing, Scott?”

    2024-12-12 · This Week in Startups · The Top 6 Startup Finance FAQ's | Startup Finance Basics w/ Kruze's Scott Orn · IDENTIFIED FROM THE TRANSCRIPT · source