Unlocking the Future of the Creator Economy with Greg Smith

Don’t miss out on my conversation with Greg Smith, co-founder and CEO of Thinkific. Learn from Greg’s experience as he navigated the transition from a securities lawyer to becoming the leader of a cutting-edge SaaS platform.

Delve Into the Transcripts for Crucial Insights from this Episode

Mark MacLeod:
In this episode, I sit down with Greg Smith, co-founder and CEO of Thinkific. I’ve been following this company for a long time. They were a client of mine back in my investment banking days. Now Greg runs a 350-person public company that’s a leader in the creator economy.

We talked about his whole journey going from lawyer to running a technology company, how his role has changed over the years, the whole process of going public, which is probably foreign to many of us, and many, many more topics. I hope you enjoy the discussion.

Greg, welcome to the Startup CEO Show. It’s a real pleasure to have you. How are you doing today?

Greg Smith:
It’s a pleasure to be here. Thanks for having me.

Mark MacLeod:
Yeah, you know, one of my OG SurePath clients so I’ve been looking forward to catching up with you. But maybe for folks who don’t know you, let’s just start with the origin story of the business.

Greg Smith:
Yeah, happy to. So let’s see, we started Thinkific in 2012, but the origin kind of goes back before that. In 2005, I was going to UBC Law School, teaching and tutoring on the LSAT in person, and just wanted to take that online to reach more people and build a bigger business around it, hopefully paying off more of that student loan. And so we went looking for software to do what we needed. And we wanted something that would let us have our courses on our own website where we had total control over data, customer relationship revenue, where conversion rates and branding and those kinds of things were built into it.

So we looked at marketplaces and didn’t really cut it because it meant putting our content on someone else’s site. We looked at LMS, didn’t work for us because it was more expensive, clunkier difficult to use, and more designed for an institution teaching students inside a school. And so, we ended up just putting together our own by just mashing together WordPress and some other pieces of software and adding some custom code and that kind of grew as a hobby.

I went on to finish law school, practice law and eventually came back to it full-time because it was going well. But while that was growing, this other thing was happening where people were reaching out to us saying, we want to do what you’re doing. We want our courses on our site, under our brand. We want to be able to sell them and build a business. And so that’s really, it was that poll from people asking us for it that we solved that problem for them by starting Thinkific as the place where you can do all of that.

And since then, we’ve kind of evolved by going beyond courses into all sorts of digital products. Basically, anytime you’re trying to share knowledge and build a business around it, and in a few other ways as well.

Mark MacLeod:
It’s funny how many great businesses evolve just by solving your own problems, building for yourself first, right? You know, Toby didn’t set out to build an e-commerce platform. He just wanted to sell snowboards, right? And his customers were like, hey, could we use this? So, that’s natural evolution.

When I think of lawyers turned tech entrepreneurs, Harley from Shopify comes to mind. And during my brief stint working with Shopify, he was in the office beside me and was just a true force of nature. And he told me that one thing that his law background gave him taught him how to think. I’m wondering what you’ve taken away. What are the good parts of that background that have made you successful in this new context?

Greg Smith:
Yeah, certainly coming into starting Thinkific, I was very much the generalist, the jack of all trades, master of none. I’d spent three years practicing law. I’d gone to business school and done some in finance. I started a bunch of businesses with varying levels of success and failure, done a whole bunch of other things and very similar to my sports career. Like, not good at any one sport, but playing lots. And so I took something from kind of each of these experiences, whether it was cultural learnings of places where I wasn’t treated well or I was treated well, and I wanted to emulate.

And then on the law front, I think there’s a lot. Certainly business, finance, commerce, and accounting were really helpful in knowing that starting a business, but also on the law front, there’s an element of it that teaches you how to think and dissect things logically. It is shockingly similar to code. Like a contract has so many of those core elements of code, like defined terms, formulas that you can refer back to to save time. All of these things are very similar. So it helped me wrap my head around, not that I write code, but at least be able to speak to engineers better.

And then certainly in risk management and decision making. To me, law is very much about managing risk and also relationships and partnerships. And so it gave me some of the tools to make sure going into a decision-making process, I understood the rules or parameters, but what risks are acceptable and which are not, and then going into partnerships, the only reason you have written agreements is so that you flesh out any unintended areas of misunderstanding early rather than when it all comes crashing down or later in the arrangement.

Mark MacLeod:
Yeah. Such a useful background. You think about the Thinkific journey and it boiled down to a few big moments, a few big relationships and deals. And ultimately, those are about risk allocation, alignment of interests, who’s doing what, and accountability. And so, yeah, having that background would probably be invaluable.

Greg Smith:
I did have to rein it in at times because early on, there was sort of like I was acting too much like a lawyer. Oh, we can’t do this. We have to do this. Ethics and integrity were always high, but there were points where it had to be like, no, we have to act like a business here and recognize that there’s a risk, we’re going to take it or we’re going to decide to do it this way.

Mark MacLeod:
If I were to kind of broadly generalize, I’ve encountered two kinds of lawyers, those who want to protect their clients and those who are there to enable business. And I’m wondering whether that law background held you back from taking risks in the beginning or whether you were just always in that second camp.

Greg Smith:
What I was referring to a little bit is that early on, my brother, who was building the business with me a couple of times, sat to say, look, I get that that’s what you’ve learned, and that’s the most conservative approach, but we’ve got to build something here. And so I took that to heart and was able to be aware of those things but make the right decisions for growth.

Mark MacLeod:
I feel like maybe when you started this business, I hear a lot about this creator economy these days and I’m in it. You know, I publish on LinkedIn every day, I do a newsletter, this podcast, and just creating content to help spread what I learned to more and more people. I feel like this maybe didn’t exist when Thinkific started. And, you know, when I look back at what’s the single biggest element in the outcome of a technology company, I think it’s luck and timing. And so I’m wondering if you could just comment on this creator economy. Has it been a big driver for you and maybe what’s the future of it?

Greg Smith:
Yeah, I mean, it’s certainly big and it certainly has been a driver for us. And certainly, luck has played a huge role in getting us to where we’re at today. I’d say when we got started, we were working with a lot of subject matter experts where coaches, trainers, authors, experts. And for them at the time, social media was a marketing channel. Nice to have, whereas that’s evolved where now it’s a need to have a marketing channel. It’s necessary.

But it’s evolved even further in that we’re seeing more and more the rise of the social first entrepreneur where as opposed to I wrote a book, I’m going to go on Twitter, it’s, I’ve built a massive audience on Instagram now what, how do I monetize, turn this into a real business? I didn’t foresee this coming sometimes.

And so that’s one of the trends we’re seeing. And with the leap, the Leap.co, which is this new AI product we have that we’re leaning into that trend and helping people who are kind of mobile and social first really unlock growth for them. But some of the other exciting trends in the space that is AI, and we can talk more about that. But yeah, sorry, there was another one tip of my tongue there. It’ll come back to me in a second, but AI is definitely a big one.

The other big trend I think is that so far, the majority of the revenue art in the creator economy is ads and brand sponsorships. But I am seeing this shift… I think Goldman Sachs has a creator economy growing to about half a trillion by 2027, and 70% of that is more ad-spread sponsorships. But we are seeing more of a shift to the creators taking control of their own destiny and business as opposed to selling someone else’s product, they’re starting to sell their own.

And so that can be merch or physical goods, but it’s also turning into a lot more digital goods. And of course, we’re in the center of the digital goods transformation there. And I love it because of the margin structure, right? Like if you sell an advertisement for someone else or even if you sell a physical good, one of the challenges on the advertisement front is you need way more views, followers, and fans to generate meaningful income.

You know, your typical revenue per thousand views for ads is maybe five to $8. Revenue per 1000 views or RPM for a brand deal might be $30 to $50, but then you still have to negotiate the deal with whoever the brand is. But if you own your own product, say like my course on my own YouTube channel, I do $1,000 in revenue per thousand views.

So I only need a tiny audience to generate revenue from that. And we see that from a lot of the people who work with us. So that’s a really exciting transformation of giving power back to the creators by them owning their products and moving into more high-margin products than what they’ve historically done. And then the other thing is that people are trying to become less reliant on a single algorithm.

So instead of building your entire existence on say, YouTube, where you rely on the ads there, you use all of YouTube, Spotify, and Instagram as your go-to-market channels, and then you own a platform where that’s where you’re producing your products and fulfilling them. And so it gives you a lot more control over your destiny, a higher margin structure, and you can earn more revenue from fewer views.

Mark MacLeod:
Funny, I always thought of Thinkific specifically around maybe course creators like digital products, but are you playing in the advertising value chain as well or this is the broad ecosystem, but we play more in the digital product?

Greg Smith:
Yeah, we’re very much in the digital product space. And the reason I highlight it is I think that, but we’re seeing more people move from ads to digital products. Like my YouTube channel when it first launched, I had ads running and I was earning $5 per thousand views. And now with the course, I earn it little over $1,000 per thousand views. And I’ve seen people do $2,000 per thousand views.

So that’s the piece we’re excited about that is less of the ad model and more of the digital product model that gives you more revenue at less need with a smaller audience and at a higher margin structure.

Mark MacLeod:
So you’re running a course on the platform now?

Greg Smith:
Yeah. So I built my LSAT course back in 2006 or something like that and it still runs. I think its peak year was maybe a year or two ago and it seems to be finally after twelve years of neglect because I’m entirely focused on Thinkific and not on Alpha score, the LSAC course, it is declining significantly but I mean we had a good run. It’s been going since 2005, 2006 and it’s only declining now. And for the last twelve years, I put nothing into it. So it’s pretty amazing. I mean we don’t generally preach passive revenue but it is very possible that once you’ve built something it can just keep coming in.

Mark MacLeod:
Do you think we have too many creators? Is there too much noise out there?

Greg Smith:
No, I don’t think there are too many. I think there’s a lot for sure. But I think we’re going to see more and continued growth. We’re still seeing rapid growth in that and if you talk to any twelve-year-old, what do you want to be? YouTube is probably more common, or a YouTuber or Spotify musician or something like this is far more common than an astronaut or police person or something like that.

So, I think we’re going to see that continue to grow and on the topic of it being too overpopulated, what I see is that people are connecting with someone who resonates with them. So there might be 50 people teaching a corporate finance course that you can find in a certain area, but one of them connects with you in the way they speak or teach or how they look at the problems. So, I think there’s still lots of room for people to deliver their unique genius in their own way.

Mark MacLeod:
Maybe the last question on this and then we’ll move on. I had Michael Litt, CEO of Vidyard on the show recently and he talked about how much friction there is to create compelling video content and how they’re trying to reduce that and make it easier. And so we talked a bunch about AI in that context and I’m wondering what are the frictions that you’re trying to remove to unlock the ability for your customers to truly be creators and leverage their potential as creators.

Greg Smith:
I love this view of it. The core of our strategy is we want to take people with knowledge, passion, and expertise, make it easy for them to go and change the world by sharing it with others, having a positive impact on others, and generating revenue doing that. And so then friction and removal of it, or making it easy, and all the steps in that journey for that person is what we’re focused on.

So initially that starts with building your first product, right? So if that’s a course or a membership or a download, we just want to make that as easy as possible, remove that friction. And then it’s how do you get out there and market and sell it? We want to remove that friction, and then it’s how do you engage with and continue to scale that up and remove those points of friction? So, we call it easy to start, easy to sell, easy to scale, and we’re focused on making things easy the whole way along. AI is certainly a big part of that journey, but so is user experience, and in every possible way, making it as easy for people to take those steps as possible.

Mark MacLeod:
So, moving to a different topic, you are a very brave soul and took this company public. And back when I was operating, my last role was at FreshBooks. And one of the reasons why I moved on is we had talked about, hey, eventually probably makes sense to take this company public. And I had exactly 0% interest in being a public company CFO. And only about 4% of venture-backed exits are in the form of IPOs. And so I think what you’ve gone through is probably fascinating and unknown to most people listening to this. Could you maybe just tell us a little bit about the decision to go public and the process itself?

Greg Smith:
Yeah, very happy to. It’s interesting you call it a venture-backed exit because no one had an exit in the IPO. I didn’t sell a penny. Neither did our venture investors. In fact, they doubled down significantly.

So, yeah, it is interesting because it can be seen as a liquidity event. And technically, I guess the stock was more liquid after that, but there wasn’t any liquidity generated in it, and that was intentional. We didn’t want to. We’re like, we’re just getting started. Let’s go and scale this thing, our decision. So we had bankers approach us and start talking. You could go public. And the initial reaction was, no way, we’re not. Maybe one day. But then we were looking at the market and the possible valuation, and the fact that we could viably be a big enough company to go public at this point.

And once we saw that, we made a pretty quick decision. Within five months of the decision, we were listed. So it was a pretty quick process for us. I think usually we’re told a year or two to prep and list, but we had an amazing team that was already in place, that had all the skills to make this happen quickly. Some of the reasons we did it was, first, it does expand your marketing reach. So we did get more coverage, press releases went further, etc. There’s a little more brand recognition.

It builds more trust, especially as we were bringing on larger and larger customers in terms of, there’s a little more responsibility that comes with it. So there’s some trust-building element. It does give liquidity to all of our team and employees, every single person at Thinkific, and shareholders. So now they have the ability for restricted stock units or options to go and buy a house or something like that, which was exciting for us. Lots of other good reasons, but those were some of the reasons to get going on the journey. And then, yeah, we can go deeper on the journey or after that.

Mark MacLeod:
Did you have to bring in a public market CFO? Did you have to make changes to your leadership team?

Greg Smith:
So I had Karin, our CFO today, who was already with us, she came on having been a public market CFO before, and so she had the full skillset so we were lucky there. And then Miranda, our COO and co-founder, played a big role in it as well. And she hadn’t done it before but just had a great skill set for doing that. So I’ve done IPOs with clients, but never, obviously, for myself.

Mark MacLeod:
You know, I heard about Shopify’s roadshow, and they were on their banker’s private jet, and it was just sort of, like, nonstop. And even though they did a video to give them leverage. What’s the actual process? I mean, was it just like a complete blur? Is it chaos? What’s that like?

Greg Smith:
Yeah, we didn’t get any of that. We got a completely different experience. I heard all these stories of jets and rushing around in Manhattan going from building to building, and I sat in my home office for 14, 16 hours a day going from Zoom call to Zoom call or Google Meets to Teams because usually the bankers prefer to use Teams. It was like 45-minute calls with a 15-minute break, and every call went over by 16 minutes. So, you know, even finding the bathroom break was a challenge.

Mark MacLeod:
Some adult diapers and let’s go. (LAUGHS)

Greg Smith:
Yeah, it was intense, but it was awesome because we got to tell the story and we got good questions and learned a lot about the process and how to do it well through that. And of course, you have your testing the waters where you essentially do the whole roadshow just to get feedback “Is this viable?” And then if it goes well, then you build up a bit more, deal with some of the feedback, and then you do the real road show, the road being online meetings.

Mark MacLeod:
Right. There you go. So I’m blissfully unaware of what it’s like to run a public company, but my impression from the outside is that it’s a communications job versus operating. And I’m wondering, how has life changed for you? How has your job changed as being public versus private?

Greg Smith:
Yeah, so a lot of it is the same, which is still, obviously the operations and growth and working with customers is the most important thing. I still spend, you know, at least a few calls a week with customers, learning more about their business and how we can help, still spend a lot of time with the team, specifically on product and what we’re building for customers. But then you add in some things for sure.

So adding that responsibility of our quarterly earnings call and getting ready for that, where we have a quarterly call, where we talk about our financial results and answer questions from analysts, and then, of course, you’re continually meeting with investors. So new potential investors or existing investors. But I loved that part in particular because when we were private, I was still taking calls from potential investors, I was still getting inbound from VC firms.

But it’s kind of half the time it felt pointless because you’d have a call or you’d talk about it or they’d want to take a meeting. And even if they want to invest, it’s sort of, we’re not raising right now, whereas now when we’re public, even if I’m not raising money, I can go have a bunch of meetings and they can buy stock in the market and the stock goes up for everyone, which is great.

So it has value to do that. Plus I find because so much of our financial data is public and other data, we get these really smart investors who will go dig in on it and then they’ll come up with really smart questions. And sometimes that sets off a light bulb for us of, yeah, we should be looking more closely at that and doing something differently there. So I do find it interesting to have that part of it.

Mark MacLeod:
If you had a pie chart, how much would be taken up just by this external relations bit?

Greg Smith:
Yeah, I mean, it varies depending on a few factors. So for the five months from decision to list, I pretty much told the team, you’re going to have to operate. I’m busy doing this. A few of us are busy doing this IPO. And so it was probably like 60%, 70% getting there. Then after that, there was still a brief post-IPO period of intensity. And then it’s more of these flashes around board meetings and earnings calls.

And then once or twice a quarter, I hop on a plane and do a non-deal roadshow where you’re not raising any money, but you’re just meeting with investors for two or three days in Toronto or New York or Montreal or somewhere. So on a pie chart right now, in a spike period, it might be 30%. Usually, it’s probably 15% to 20%. And the rest just operate the business and grow and talk to customers.

Mark MacLeod:
Oh, good. That’s great. That’s better than I thought it would be, to be honest.

So, Canada has not been a friendly place for public technology companies. That’s generally a true statement. You know, I’ve found Canadian public securities investors to be fickle with respect to tech companies. They’ll pile on when times are good, but the minute times are bad, they’re out. And, you know, you perfectly timed your raise in some respects.

But since then, that entire cohort has traded down and Nouveau has gone private, Dax da Silva has come back to lightspeed and made it very clear he’s open to going private. And just wondering, first of all, do you regret going public? And what are your thoughts on this whole go-private kind of trend?

Greg Smith:
Yeah, good question. And so there’s a bunch baked in there, I think. I don’t regret going public. There are pros and cons, and it’s certainly not for everyone or every business, but as I shared, there are a lot of really good things that have come out of it above and beyond the $180 million that we raised. And yeah, we raised at a really good time but the trade-off when you raise at the peak is, and I’ve heard Warren Buffett talk, he wants to be an accurate valuation, not excessive and not low. And I’d love to just operate there for all time, too, but you do move with the market.

So we came down off that peak shortly after the IPO, but we’ve seen really good share price appreciation over the last couple of years, which is great. I think we’re up 70% to 100% over the last twelve months and well the year before that, too. So things are going well for us that way, get a lot of good feedback, and it also introduces some maturity within a lot of levels of the company. You’ve got governance from the board that I think is healthy.

We’re actually better known competitively now for security, reliability, and uptime because we’ve invested so much in our reliability and security and SOC 2 and things like that, which is sort of related to being public, but also just to having customers that are scaling to new levels.

And on the fickleness of investors, I do find even cross border there are just depending on investment strategy, some investors are in one day, out the next, whereas we have some big holders in Canada who have just been accumulating positions.

And so they’re very long holds, which is exciting because they see the opportunity that we see in terms of the scale of the market we talked about, but also what we’re up to strategically. So I still see people buying for the long term, but it does take a while to flesh that out. Some are kind of in for a bump and out, and others are picking that long-term.

I am learning more and more there are ways to sort of pick your investors in terms of how you speak, that you’re in it for the long term and you’re going to do the right things for the long term, and that will attract the right type of investor. It’s not perfect and you can’t always attract exactly who you want on your cap table. But you do have some flexibility there.

Mark MacLeod:
Yeah, well, I’m on your cap table.

Greg Smith:
Oh, wow. Really? Thanks!

Mark MacLeod:
Yeah! So Eric, who worked with me at Surepath, when I wound down Surepath, moved over to CIBC and was involved in the process. And I was like, well, I think Greg’s a masochist for going public, but screw it. I’m going to take a bet because I like him, I like the company. So, yeah, I’ve been on it since the IPO.

Greg Smith:
Well, thanks for holding on, and hopefully we can get you back up there.

Mark MacLeod:
So you’re twelve years in now. How do you stay motivated?

Greg Smith:
Yeah, good question. It’s evolved the whole way. Like, the work you did in the first three years is so radically different from what I’m doing now. Whereas then I was sort of looking at every design, sometimes moving pixels myself, rarely writing code. I tried once or twice and they kicked me out. But today it is a lot more and it’s grown into more and more people management.

So one, I think is recognizing that when you’re growing, I have to constantly be growing and evolving. So it’s a lot of learning and studying just as to like, you know, what’s the next thing I want to solve? I try and stay focused on growth because I find there is a temptation, especially as you scale, to get sucked into process and problems and problem avoidance and risk avoidance as opposed to growth opportunity.

It’s really easy when you’re getting started. Everything is growth. You won’t have any problems. It’s just “Let’s grow”. So I try and stay there because to me that’s motivating. Whereas I can get demoralized and demotivated if I focus too much on just what our problems are.

Another would be working with great people. So we got some exciting announcements coming out shortly around some big hires we made that just level up the overall leadership team that I’m excited to work with.

But the biggest one, I think, is just talking to our customers. Every time I get on with the customer and I hear their plan or their vision or what they’ve already executed with Thinkific and how we’ve been able to make a difference in their lives or their student’s lives, that’s the big motivation for me, just helping people.

Mark MacLeod:
So are you doing periodic customer support or you’re just doing outreach just to be able to speak directly to customers? How are you getting that direct contact?

Greg Smith:
Yeah, I used to do a lot of support like I’d do a shift essentially every week but I do a lot less of that now. Occasionally when it hits my email, I’ll do a little bit of it. I was helping someone today with a quick problem, but it’s only a few minutes in each interaction. Much more is just hopping on and saying, “How can I help?” And then having almost this kind of conversation with the customer about what’s going on, what’s working, what’s not. Here’s some advice I can share, etc.

I also actually have a podcast called Unique Genius, the Business of Creators, where I interview some of the top creators out there and sort of getting like, how’s it going? What are you doing? Well, what’s your story behind it? So it’s all those points of engagement and just learning about their business and seeing how I can help.

Mark MacLeod:
I should know this, especially since I’m a shareholder. But when I think back on transformational decisions for Shopify and FreshBooks, in both cases, it was the decision to launch a payments business. Are you in the payment flow? Do you have a payments business?

Greg Smith:
Yes, we do. So, we watched and certainly learned from Shopify in particular on the payments business. Initially, it was mostly just Stripe Standard or Stripe Connect. And then more recently, the last couple of years, we built our own payments engine. It is powered by Stripes’ API, but we run the payments rails and built on Stripe’s payments rails.

We have Thinkific Commerce, so kind of like, we call it T-Pay or Thinkific Commerce, similar to Shop Pay. And it’s got a whole bunch of features beyond payments that allow people to do order bumps or buy now, pay later, multi-license checkout, or bulk selling. And what we’ve seen is it significantly increases the volume of sales and conversion rates that our customers do when they use it. And so we’re trying to encourage everyone to use it because it’s just better for their business.

Mark MacLeod:
Yeah. What I found at Freshbooks was the customers who used our payments platform churned at a meaningfully lower rate than the customers who did it. And so LTV was higher. And, yeah, it was just like kind of one seamless experience. And we didn’t have a checkout per se. And I think it’s even more important in the context of checkout, where you want someone to make that decision before they click off and go somewhere else. You’re trying to remove all friction possible.

Greg Smith:
Yeah, it’s great. And there’s so much value we get to add. Like we get to calculate, collect, and remit their sales taxes for them so they don’t have to worry about that. There’s just so many things we can do for them this way. And yeah, we do see LTV is up, churn is down. So it certainly helps their business, it helps ours. It’s a great way of aligning our success with theirs and it doesn’t cost them any more. That’s the nice thing because they’re going to pay for payments from somebody, the 2.9%. So better that we participate in that without having to change prices.

Mark MacLeod:
You know, in my coaching practice, I only coach CEOs because it’s the toughest role and there’s a 100% correlation between a CEO’s performance and the outcome of the company. And often talk with CEOs about this change in altitude that needs to happen. Like in the beginning, you’re working in the business, you’re building product, you’re selling product, you’re taking out the trash, you’re doing whatever needs to be done. But over time you’re working on the business to have the right people.

Are they pointed in the right direction? Do they have the resources they need to succeed? And it’s not as simple as that. You’re not just in an ivory tower looking down, you still have to get your hands dirty. But by and large, hopefully, most of the time you’re at the right altitude. And you know, Thinkific is now 350 people. And I’m just wondering for folks who maybe aspire to have a 300-person company of their own at some point, can you tell us how and when the altitude of your role changed?

Greg Smith:
Yeah, it’s changed a few times in a few ways. And I’ve even scaled, I’ve gotten too far. Ivory Tower at one point, honestly, and scaled back a bit, I’d say certainly around 100, 150 people was when I saw my role really transition from being too in the weeds to being much more leading and empowering other leaders, and that it’s been like that ever since.

There was a point though where I got to a point of too much “Hey, that’s all taken care of. I’m going to go high level and just strategic and stuff.” And I think there’s always a role. I mean, you even see it with at least I hear the stories of people like Toby diving into a specific project.

So the way I look at it right now is, yeah, you’re higher level people management, empowering leaders. But you do sometimes need to put it in, drill a hole in and look at what’s going on, or drop a dipstick down and go deep on a few projects to understand how it’s working, especially the most important ones. So I’d say 20% of my time is still going deep on a few projects, usually only one at a time, but it just allows me to get a better sense of what’s going on, see if I can help there, see if it’s doing well, execute it.

Mark MacLeod:
Do you manage your schedule so that you can be this sort of like a roving free agent and dive in whenever you need to go, or is your schedule just kind of back-to-back madness?

Greg Smith:
I wish I could say I was better at it. I’m currently managing too many people and having too many sort of meetings in my schedule without enough time to sort of rove and go in where I need to and be a bit more strategic. It’s a point in time right now, and with a couple of key hires coming, that will open up considerably.

So I’m kind of just at this moment getting by with that, but within a month, I expect a full calendar revamp. I kind of do a once every six months, once-a-year full calendar revamp. At least mentally delete everything and start from scratch and think, is this the best use of my time?

Mark MacLeod:
As I’m sure you saw, Shopify has several times… It only became public in the most recent time, but periodically Tobi will just blow up all recurring meetings and force people to start over again.

Greg Smith:
I love it. It’s like, yeah, I don’t have quite the level of chaos engine that he’s got built in, I think, for that stuff. And I love the new thing they’ve got going, too, where I think they’re using a tool to calculate the value of a meeting. So it’ll look at average salary across attendees and tell you what that hour is going to cost you. Which I think is a great way of really encouraging people to think twice about just adding way more people to a meeting.

Mark MacLeod:
Other than again, when you were a SurePath client, the business was impressive but much smaller. And now you’re over 350 people. Other than just sort of hanging on for dear life, what have you done? How have you invested in yourself so that you grow faster than this business and so you always are the most relevant and best leader that the business needs?

Greg Smith:
Yeah, I mean, there’s the mechanisms and then how I determine what I study. It’s courses, podcasts, books, and mentorship. And then peer feedback, whether it’s internal or external, I do find getting out of the environment you’re in and talking to others who aren’t in it so you can get that kind of fresh perspective can be good. And then in terms of the topics I choose, it’s some of the internal peer feedback. It’s some of the external peer feedback as to what I should be thinking about, but I’m not.

I do try and it can be a real struggle to focus on the growth elements as opposed to the problem-solving elements. And then it’s kind of picking one thing for a period of time that I know I need to be better at. Maybe it’s people management, setting goals, or building our differentiated strategy and then going a bit deeper on that.

Mark MacLeod:
Becoming a public company meaningfully increased your workload? Is it like I’m doing everything that I was doing before and now I’m also doing this public stuff on top so my days have gone from, seven to 9 hours of just making stuff up, but is that the dynamic?

Greg Smith:
I think so. There certainly were lots of periods pre-IPO where it was like, hey, we’ve got to get this shipped or we’ve got to launch this campaign or something, where I was still putting in crazy time. I also like, around the last eight years, the other big shift on the calendar is I’ve had two kids, so I’ve made more accommodations around evenings and weekends there. So in a sense, it’s more piled on, but it happens in different ways because I want to put my kids to bed at night and take them to soccer on the weekend and all that kind of stuff. So I’ve made an intentional shift there.

Whereas before or without kids, I could kind of just get home, have dinner, and go right back online and work until, you know, sometimes I work until I am done. I’ve always had a pretty good balance, but to me, balance doesn’t mean every day looks the same or it’s perfect or I always get to work out or, you know, see my friends. It comes in peaks and valleys, right? Plus, if you love it, then balance is a little less important.

Mark MacLeod:
Back to law school for a second. I know many lawyers, and of course, it’s about Bill Bellowers and churning especially if you’re in securities, right? You’re just cranking on deals all the time. I feel like that background gives you stamina. Is that true? Like, did you acquire stamina as a result of being a securities lawyer?

Greg Smith:
Yeah. I mean, I certainly did round-the-clock deals and lots of work, and I saw other people at the firm doing a lot of that, and I loved it. I think a lot of people assume when I tell them I left law that it was like, oh, yeah, you kind of hit a point where you didn’t want to do it anymore. I was like, no, I was loving it right up to the last day and even missed it for years afterward. Now, I don’t know if I’m a deal junkie, but I loved it, and the cool thing for me as a securities lawyer and corporate lawyer, you would parachute into a company for just a few months at the most exciting time.

Like, they’re raising money, they’re buying a company, they’re going public. You get to be a part of all the cool conversations, or many of them making that happen, and then you’re on to the next one. So I thought that was super fun. And, yeah, that meant crazy hours, but it came with that excitement. And the other thing that made it energizing, I think, was working with just exceptional people.

I was at BLG and I was at Blake’s and at both firms, I had just awesome lawyers to learn from and look up to and work with and peers to work with. And so that made it a lot of fun. And so that was actually what I missed the most when I made the shift into entrepreneurship was my brother. He’s smart. It was good to work with. We had our moments, but, you know, you didn’t have that same broader team around you until years later as we built that up.

And so that was probably the piece that I missed the most. But, I mean, on the motivation and stamina side of things, there’s lots of talk of burnout these days. I think that burnout or that lack of motivation comes when you don’t know what you’re trying to achieve, you don’t have a clear goal, or you don’t know how to get there, or you’re trying, but you’re failing.

Whereas if it’s clear where you’re going, you’re trying and you’re making progress toward it, and you’re working with great people around you where it’s fun, then I don’t burn out, then I don’t hit any sort of real negative component because like, hey, we’re going that way and we love the people we’re riding with and we know where we’re going. You know, we didn’t go as far today maybe as we wanted to, but we went somewhere and we’re going in the right direction. That to me is what keeps me going until whatever time I need to work.

Mark MacLeod:
So you mentioned you got two new executives joining soon, and I’m just curious over this journey, how many times you’ve had to kind of do a rev on your leadership team, and how did you know when it was the right time and what’s the right balance in your mind between just replacing people versus growing people?

Greg Smith:
Yeah, it’s tough. And I don’t know that I’ve ever always done it right. So sometimes it was they wanted to try something else. Sometimes it was, they were exceptional for a period of time at a stage of growth, but didn’t want to or couldn’t transition to that next stage. Sometimes it was just structurally we didn’t have a role for that skill set anymore. But I think you have to be very careful about categorizing people as, say, a player or not. It was more a player at a time in a role at a certain scale for a certain responsibility or even a certain task.

I like is it Andy Grove’s high output management, and his concept of task-relevant maturity, and you can apply that to particular tasks, but I think also to certain stages of the company in certain roles. And so some people got to certain stages and said, “My CTO at one point was like, I think my sweet spot is sort of like up to 50 people,” and we pushed him way beyond that and he was amazing, but he wasn’t in his happy zone.

So eventually he’s like, we got to start working on the succession plan. I want to operate a smaller company. As you’ve said, you didn’t envy being a public market CFO, so you understand where your happy place and sweet spot are. And I think what is important is understanding that for people, where do they want to be operating? And sometimes they can see it themselves and then it makes the transition easier.

Sometimes they can’t. You have to help them see it or potentially coach them. In every case, for me, the starting point is trying to coach people up to that next level. But if that doesn’t work or they don’t want to or they can’t, then that’s where you have to look at other options.

Mark MacLeod:
Instrumentation comes up for me here. When I think about SaaS businesses, you’ve got all these metrics and you’ve got kind of early indicators, etc, right? Like, if I’m going to hit my sales targets for the month, I can look at new sales-qualified leads, I can look at how they’re converting to marketing-qualified leads, and I can kind of measure my funnel. And I’m wondering whether you have any instrumentation set up to know whether your leaders are keeping up, or is it more after the fact, as you see that they’re making mistakes, falling behind, what’s your actual mechanism for measuring and monitoring this?

Greg Smith:
We have a data science team that goes deep on the metrics, and that combined with our finance team, we’re able to produce tons of data reports. You look at Rockefeller and JD Rockefeller and how the Rockefeller habits were sort of articulated. And one of the things they did good, and going back many years to an oil company, was they were known for having a metrics review that they got relatively close to real-time data coming in from across the company, from all over the company and across the country that they could look at.

And that was touted historically as like, what an amazing management practice. Whereas now I think that’s just so commonplace and standard. Like, who doesn’t have a metrics dashboard that they’re looking at for their business?

In software at least, we’re beyond that, where we almost have too much data, where sometimes we have really good instrumentation, where I can tell which teams and which people generally are doing well, but it’s almost like there’s too much. When I talk to any one individual or team, there are probably 47 metrics that they could look at.

The effort for us now is more like refining it to what’s the most important output metric and the input metric. The input is a more customer-focused and leading indicator, and the output is more tied to revenue. But even within that, it can be hard to parse from so much data to understand whether someone or some team is doing well or not. I mean, usually, you can get a view of it, but then there’s just so much data to unpack.

Mark MacLeod:
Yeah. When I joined FreshBooks, I found there were all these different silos of data. Customer support had its data marketing had its data, product had its data. Of course, finance had data. I was just like, yeah, this is bullshit. There’s gonna be one source of truth and it’s gonna be finance. They’re all well intended, but you can make an Excel spreadsheet say anything. And it was also just a lot of overlap and kind of redundancy, right? So that was an important initiative in the business, I think, just to have a very strong FP&A.

Greg Smith:
Yeah, and the one source of truth is key, and we have a really strong FP&A team. And so there’s an element to a source, but also a trusted source in that you always want to separate church and state, right? The people doing the work versus the one sort of measuring it. Like doing it should still be measuring it, but I think that’s where the tendency comes to. Let me modify the view of the graph unintentionally. It’s never poorly intended, but you present sometimes the data that looks good as opposed to the worst stuff.

Mark MacLeod:
So, we talked about earlier, right, you’re twelve years in, you’ve got a public company, 350 people, so there’s lots of lessons that you’ve accumulated along the way and scar tissue. And like, I don’t know, if you were doing a do-over, if you had a Mulligan here and you were starting over again, what advice would you give yourself?

Greg Smith:
Yeah, it depends on the stage. I think, starting out, I would say just build a content engine from the get-go, but continue doing all the other stuff you’re doing, but also build a massive content engine, especially today where even if you, because we knew the industry we’re going to play in, but we didn’t know exactly what problem we were going to solve, and it took a few years to hone in and lock it in.

And so if that whole time I was building a content engine around SEO and content and audience around that general topic, we would have always had something to draw on that is very low-cost customer acquisition and building trust and notoriety in the space for that. So I would do that, and then I think we did do some layoffs, right? And so going back and saying maybe don’t hire as much going into it.

It’s a tough one, because when things accelerate, if you don’t hire into the curve, you could be left behind. But if you do hire into the curve like everyone else does, and then things slow down, then you’re with every other tech company like we were two years ago where you’re forced to cut back on costs and lay people off. So that’s a tough one because sure, if I had the crystal ball I wouldn’t do it, but if growth accelerated tomorrow, would I hire into it? Probably. I don’t think I’d do it quite as aggressively though.

I think the big one for me is we were profitable or break-even for the entire life of the company up until a couple of years ago and then we overspent. And so I think I would have put more strict financial controls on spending even in high-growth periods so that you can’t end up in that situation where you’re overspending and you have to adjust. We’ve adjusted fine. We’re back to profitability and growth, but you certainly went through a painful period that wasn’t necessary if only I had tighter controls on that.

Mark MacLeod:
Hey, listen, hard to fault you for that. That was a period of time when capital felt very freely available. And when you think about SaaS businesses in terms of long-term value maximization, it’s most strategic to acquire as many profitable customer annuities as possible.

It’s why the OG SaaS company Salesforce was a giant before it turned a penny of profit. If a customer of LTV to CAC is positive and you have channels where you can acquire more of these positive annuities, you should just keep acquiring them assuming access to capital. But I think that rug was pulled out from under everyone and so pretty clear that public and private markets are rewarding capital efficiency these days.

Greg Smith:
But hey, we’re back in growth opportunities, which is exciting. And on the reward, it’s still probably a two-to-one point of growth over a point of profit. So I think we’re still paying out more on valuation for growth than we are on profit. And that makes sense to me because a dollar of growth can earn you profit whereas a dollar of profit by cutting costs is never going to earn you a point of growth.

Mark MacLeod:
So what does the future hold for you and Thinkific as we start to wrap up here, where do you want to go? What’s your vision?

Greg Smith:
Yeah, super excited about it. I think the big thing is back to that core idea of how we help people who have passion, knowledge, expertise, or businesses as well that are doing it, get it out in the world, have that positive impact, and generate revenue doing it. The medium and mechanism are going to change. It will not always be the Internet. Maybe we’re moving into a more augmented reality world.

AI is certainly changing things such as the medium and the mechanisms that we do it, but it’s really about unlocking something I don’t think is going to change in the next hundred years, which is individuals like yourself have a unique genius that you want to bring to the world and have a positive impact on others. How do we help you do that and get that message out so you can impact others?

But also make sure that it’s sustainable so you can build a business doing it and continue to add to and grow and produce higher quality education and reach more people. So that’s the vision and then the mechanisms, the near-term ones I’m excited about is certainly our commerce stuff because it’s helping people sell more AI because it’s just making it so much easier. And a few others, but those are some of the big ones.

Mark MacLeod:
That answer there made me think of a final question which is that you’re a commerce guy, a law guy, are you personally driving the roadmap? Because you’ve just articulated some pretty robust and kind of technical ways that the roadmap can go, are you driving that?

Greg Smith:
I try and drive more of the outcomes we want to achieve, the difference we want to make and then we’ve got some amazing product design engineering leaders who are driving the roadmap. So they’re figuring out the specifics of how we’re solving the problems. That was a hard lesson for me to learn. For a long time, I was driving the roadmap and now I’m not, but the transition period was tough.

I’d kind of heard that story that the strength of the founder often becomes the weakness of the company. And I think for a time that was true where my strength was kind of product-led and then we went through a period where it was pretty tough and now we’re back in a strong position there. But that required some learning on my part and also getting the right people in who could take on a lot of what I was doing and do it better than I could.

Mark MacLeod:
So you’re clear on what your superpowers are and you’re trying to just lean into those.

Greg Smith:
And then I guess looking forward, the other big opportunity we see is that fairly early on we’ve talked lots about the creator economy, but we also saw a lot of larger companies coming to us and continuing to where they’ve kind of got the same needs. They want to take something they’re good at and share it with the world and drive revenue with it or package it up alongside existing products or services. So this would look like a software company, like Hootsuite, packaging up courses to deliver with their software or even selling courses and certifications. So we’re seeing more and more of that. So that’s another really exciting trend that we’re riding and a part of.

Mark MacLeod:
Final, final question, because I’ve said that like three times now or something. What are your thoughts on career content, being married with community platforms like Skool are kind of pushing that angle. Is that a thing?

Greg Smith:
Yeah, we looked at that… Geez, it was five years ago. We were looking at maybe a bit more looking at Facebook groups because that was where the community was being built. And recognizing that in Facebook groups, there were data privacy issues and advertising issues. I mean, you go into your special Facebook group you’re building for your company, and your competitors are advertised along the side, the data is being sold or used in weird ways or whatever they’re doing there, and you don’t have a lot of control over who’s in, who’s out, especially if you’re tying it to commerce.

And so we built our own community platform. So now with Thinkification, that is where some of the evolution beyond courses, you can build an entire community. You can have different tiers, you can have fees for it, moderators, and so very similar to sort of a private Facebook or private Slack, but it can also be tied to generating revenue.

You can have free tiers and paid tiers. So, yeah, I think that’s a huge and growing trend, and certainly, that transition from the Facebook groups to owning a community where you have a lot more control and you can create a much healthier environment as well for the participants is a big and growing trend, and we’re excited to be part of it.

Mark MacLeod:
It has been a real pleasure to catch up with you after so long. And like I said, I’ve been a loyal shareholder since the time that I could. And, in addition to that, I’m finally about to become a customer. In my one-on-one coaching, I only coach growth-stage CEOs, and every time an early-stage CEO comes, all I can say is, no, you’re not ready yet. But I’m finally getting ready to launch kind of a mastermind and group program where I’ll be able to get them on your platform. I’m going to take your product for a spin.

Greg Smith:
Awesome. Yeah. Let me know if I can help in any way. That’s great. Thanks, Mark.

Anyway, another cool thing we didn’t come into is I don’t know if you saw, we launched a partnership with Spotify, so now people producing courses on Thinkific can build on Thinkific, sell in Spotify, and it’s just running in the UK now, but hopefully we go global with that one.

Mark MacLeod:
I did see that! That’s cool. I mean, I’ve always thought of Spotify for music, but it’s the number two platform for my podcast. So clearly, more and more content going on there, for sure.

Greg Smith:
Yeah. Music, podcasts, audiobooks, and now courses.

Mark MacLeod:
Thank you so much. I really enjoyed the conversation.

Greg Smith:
Thanks, Mark.

Mark MacLeod:
Hey, thanks for listening to the Startup CEO Show. If you’d like to connect with me, be sure to visit my website at markmacLeod.me, or follow me on LinkedIn at The Mark MacLeod, or X account @markmacleod_, and if you want to tune in again next week, be sure to subscribe on YouTube, Spotify, Apple, or wherever you get your podcasts. We’ll see you next time.