Thu, 21 February 2019
238: Juggling Multiple Projects and Knowing When to Step Away, With Grasshopper Founder David Hauser
David Hauser’s life changed forever the moment he taught himself how to code.
Like so many other nascent entrepreneurs, the power of computer programming set him on a lifelong path as a tinkerer, always fine-tuning and building in an effort to shape his and others’ futures.
In much the same way Hauser learned how to code, his entire entrepreneurial journey has been one of unrelenting trial and error, involving a mix of success, failure, and personal and professional evolution. With the creation of tech companies like Grasshopper and Chargify, Hauser used his talents and curiosity to shape his own destiny, and make a splash in the startup world.
Now, in his latest endeavor, he’s directed that very sense of experimentation to the field of health and fitness, with an upcoming book documenting his extensive adventures in improving his own physical well-being.
But it all started with a few lines of code that enabled him to pursue a nontraditional professional life.
“I always worked for myself since before high school,” Hauser says. “I never had a traditional job.”
In the late 1990s, the internet was gaining unstoppable momentum, and as websites started to become viable means of doing business, the demand for web designers and ad creators increased dramatically. This shift granted new opportunities to clever teens on the cutting edge of new technology who wanted to make a few bucks (and sometimes much, much more) from the comfort of their childhood bedrooms.
Hauser, who has no formal tech training, was one of these teens, swiftly making his way into the world of banner ad management and creating his own company WebAds360.
“From there, I started grabbing onto different things, learning different technologies, working with other people,” he says. “But it all started with web design.”
Before graduating college, he founded a second company, called ReturnPath, to help businesses that used permission-based email lists to keep their addresses up to date as subscribers graduated college or changed jobs.
Being a teenage entrepreneur in the late 1990s and early 2000s presented some major limitations, however. For one, what phone number were prospective clients supposed to call?
Cell phones of the time were still extremely basic and lacking features like putting a caller on hold or setting up a conference call. Meanwhile, home landlines might be answered by baffled family members. Neither option exactly screamed professionalism. It wasn’t just a problem for young people working at home, either, as lots of scrappy new entrepreneurs were lacking dedicated business phones.
So when the born and raised New Yorker headed off to Babson College in Massachusetts, and met Siamak Taghaddos, another entrepreneur with a similar problem, they put their heads together to pursue a solution.
Leaping Toward Success
“It started with a really simple idea,” Hauser says.
All they wanted was a way for tiny companies, startups, and solopreneurs to have the phone presence of a large, established company. And when neither he nor Taghaddos could find an existing solution to their problem, they did what so many successful entrepreneurs end up doing. They built their own solution.
Because they were only out to solve a problem for their existing businesses, Hauser admits they didn’t spend a lot of time on research or planning.
“It wasn’t well-researched necessarily, beyond the fact that we knew we had a problem, and we thought that we could solve it,” Hauser says.
During the process of creating the solution to their own problem, they realized that they were really onto something. That maybe this was going to be much bigger than a new tool for their own tool belts.
And because he and Taghaddos had their fingers in a lot of pies, and the money flowing in from their existing projects was enough to fund their new endeavor, they never needed to request outside funding.
In 2003, the pair officially launched Grasshopper, a service that enabled small businesses to present themselves like big businesses using just a cell phone, complete with extensions, customizable greetings, and simultaneous call handling.
Before long, Hauser shut down all of his other businesses, including WebAds360, and decided to focus entirely on the management and growth of Grasshopper.
And business boomed.
Small businesses and startups flocked to the service, delighted that it enabled them to operate with the professionalism of a well-established corporation. The company continued to grow for the next six years, when Hauser decided it was time to relinquish his role of CTO.
“I was always relatively technical,” he says. “But I am definitely not a top programmer, and as we really started to build out the company, it was clear that we needed to have better leadership from a technical perspective, and I could apply my talents better elsewhere.”
So, Hauser moved through another phase in his evolution as an entrepreneur and broadened his scope.
“Rather than being just focused on the technology side, I spent a lot more time in company culture, HR, hiring, process, goals and how we implemented those,” he says. “I shifted my focus.”
And as he stepped back, looking at Grasshopper from all angles, he saw possibility everywhere.
Trial and Error
Even though Grasshopper was a big success, Hauser’s head was bursting with new ideas and new problems to be solved.
In 2009, he developed Chargify for streamlined recurring billing. Then in 2010, he created PackageFox, a way to secure guaranteed refunds from late or lost packages shipped through FedEx or UPS. And in 2011, he launched PopSurvey, a graphical survey creator.
These are just a few of the self-funded side businesses born out of Grasshopper, and Hauser says there are many more that aren’t resume-worthy or that never saw the light of day.
“Those are probably just the ones that became something,” he says. “There are tons of others that failed and never really got very far, or failed horribly bad and we lost a lot of money.”
PopSurvey eventually fizzled out, overcome by competitors. PackageFox was an opportunity for Hauser to learn more about automation, but he eventually sold it off to someone in the space who could make better use of it. Hauser kept Chargify longer than either of the other two, but recently sold it, as well.
And while Hauser learned much during this time of exploration and creation, he admits that it created a lot of tension within his team at Grasshopper.
“We thought maybe we couldn’t keep growing Grasshopper, and we started all these things, and wasted a tremendous amount of time and money, but more importantly distracted ourselves—and even worse, probably, distracted the team—from the thing that was growing well. We could have just doubled down,” he says. “The success would have been much better than if we had wasted all that time, but that was the blind spot we had, and luckily we realized it.”
Hauser says that internal blind spots are some of the most difficult challenges that founders face. While an entrepreneur is wrapped up in the excitement of a new creation, he says it can be nearly impossible to determine impartially whether or not that is the best possible use of time.
“We’re overly invested in something, and we have that blind spot to maybe this isn’t the right thing to be working on right now,” he says.
But whether by choice or by force, the decision to take the left fork instead of the right is eventually made.
“I think sometimes it happens naturally. That progression just happens and you kind of see it,” he says. The problem is that sometimes it takes too long, and we over-invest in something that’s not productive, taking time away from something that has a much brighter future.
And while he is thankful that the ultimate effect this period of distraction had on Grasshopper was minimal, he would have done things differently given the opportunity.
“Looking back on it, it was not the best choice,” he says. “We should have focused on Grasshopper and grown Grasshopper.”
But despite any amount of distraction, Grasshopper grew and grew until the company was raking in $30 million in annual revenue. Before long, the success of Grasshopper drew the attention of hungry eyes, and the acquisition calls started pouring in.
Sales and Farewells
“When we started the company, we had no exit plan,” Hauser says. “Our goal was to build a company we loved being at and loved doing what we were doing. That was it.”
So when the first of the interested buyers knocked, Hauser turned them away empty-handed.
But as Grasshopper was a privately funded company, without the limitations placed on it by investors and capital, interested buyers were not to be discouraged. Eventually, Citrix, a multinational software company, made them an offer that they couldn’t ignore.
Citrix said that Grasshopper could retain their brand name, keep the team together and continue growing the company.
Over the course of a year, Citrix worked with Hauser and Taghaddos until they recognized that this proposal was a great fit for everyone involved. So they decided to sign on the dotted line.
As soon as the sale was finalized in 2015, both Hauser and Taghaddos bid their greatest success farewell, something Hauser describes as being “very emotionally difficult” but “best for both the company and Citrix.”
He trusted the management team to keep steering the ship in the right direction, and with Citrix’s new ideas for growth and strategy, he knew the business was in good hands. Neither he nor his partner were interested in sticking around for “two more positions for highly paid executives with titles that are kind of meaningless in a big public company.”
While he knew he had made the right decision, Hauser was rocked by the impact of his choice.
“All of a sudden, your email address changes, your phone number, your identity,” he says. “For 12 years, I was the guy involved in Grasshopper, and I ran Grasshopper. That’s who I identified with and people identified me with, and that just changed overnight.”
For a year after stepping away from Grasshopper, he continued with Chargify, but in July 2016, he sold that business, too.
With a clean slate, Hauser stepped into his next phase of evolution.
He explains that the core purpose of Grasshopper was to empower entrepreneurs to succeed. Now, he’s just hopped into a larger field.
“After a year, I came back to and found my core purpose,” he says, “and that’s empowering others.”
The Pursuit of Health
It’s been two years since Hauser’s life changed with the sale of his two most successful brands, and he spent the latter half of that time on an exciting new project: himself.
“I really wanted to change my life, and that included changing my exercise and diet, and I went from doing extreme endurance sports to practicing yoga six days a week,” he says. “Like massive change.”
In pursuit of this change, he also took just about every test imaginable—blood tests, stool tests, sleep tests, DNA tests and more. All in the pursuit of a healthier life.
And now he is ready to share what he has learned.
Thirty pounds lighter, Hauser is releasing a book in 2019 called Evolve: Optimize Your Life, Body and Mind. In it, he busts myths around fad dieting, trendy workouts, and quick fixes, sharing instead the methodology he used to transform his own life.
He also tackles many of the health sacrifices entrepreneurs make while chasing lofty goals. And despite all the changes he tried in his own life, he isn’t necessarily an advocate of massive life shifts or hours spent in the gym. He believes that often the little choices can make the most impact.
“It’s always easier to work an extra hour past midnight because no one is bothering you, right?” he says. “It’s easy to pick up the phone and call for pizza, because you know you get that instant boost and gratification and can continue working for an extra hour. But I think, at the end of the day, what I care about is output and productivity, and I don’t think there is very much value in that extra hour of work when it is low productivity and low value, and it is just work for work’s sake.”
Through his book, Hauser hopes to open the eyes of founders and non-founders alike to the power they have over their own lives and the small adjustments they can make that will bring huge impact.
“The idea with the book is allowing people to understand that their life is a self-experiment and doing little things like maybe just buying a new pillow for your bed…could have massive gains,” he says. “Each thing in your life is an experiment, because you’re different from everyone else.”
Once again, just as he did as a teenager learning to code, Hauser is relying on the power of trial and error—how the slightest adjustment, addition, or subtraction can make a big difference. He is, yet again, learning to crack the code, and yet again, hopes it can change lives.
David Hauser’s Tips For Living A Healthier Life
Since founding, building and selling Grasshopper, David Hauser has invested much of his time in pursuit of a healthier life. In 2019, he is releasing a book on the subject, “Evolve: Optimize Your Life, Body and Mind,” and these are just a few of the tips held inside for entrepreneurs pursuing a healthier lifestyle. For more information on the upcoming book, and a free chapter on the impacts of coffee, visit www.evolvebook.com.
“I am a huge believer in routine,” Hauser says. “If you talk to the most successful people in the world, most of them will tell you routine is very important.”
He is such a strong believer in routine that, even when he doesn’t plan to work out, he still goes to the gym because it’s on his schedule. By developing a routine that allows for more movement, more stability, and more sleep, he thinks entrepreneurs can improve their lives—as well as their businesses—in enormous ways.
“As founders, understanding our sleep patterns—improving our sleep patterns—I think has tremendous effects and gains on our productivity the next day, the next week, the next year that we don’t realize,” Hauser says.
By making more time for sleep, and being unwilling to compromise that time for a little extra work at the end of the day, he believes that entrepreneurs will actually be far more productive. Entering into each new day refreshed improves mood, interaction, and problem solving—all areas that are vital for success.
“Life is a self-experiment and doing little things like maybe just buying a new pillow for your bed…could have massive gains,” Hauser says. “Each thing in your life is an experiment, because you’re different from everyone else.”
Even the smallest changes can make a massive impact, and what works for others may not necessarily be the best choice for you. By trying new ways to solving old, persistent problems, he believes people can make great impacts on their health, and what is more entrepreneurial than that?