Reminiscing about YNAB's Early Days, New Projects, and More

In today's episode, Mark takes inspiration from George Constanza, the perpetually underachieving and romantically inept character from Seinfeld, to confront his negative business habits. In the episode "The Opposite," George realizes that he's always followed his intuiton, but every decision he's made has turned out to be wrong -- he's dissapointed in where his life has ended up, and in his failures with women. So, he decides to do the opposite, that is, everything his intuition tells him to do, he does the opposite. The result is predictably hilarious, and leads to George talking to women previously out of his league, and eventually landing his dream job managing the New York Yankees.   Mark has started employing the "Constanza Protocol," as he calls it, in business, as a way to break negative habit loops. As he has stated on multiple episodes, Mark struggles with the idea of having and managing employees (even good ones!) and his urge is to retreat to work he can do on his own -- like automating tasks or building new software tools. Under the Constanza Protocol, however, he has to do the opposite and instead run toward the manager/employee relationship, schedule calls and check ins, talk about hours and whether his employees are feeling happy about their workflow.   Maybe he won't be as successful as George, but it is a useful way to recognize your negative patterns and break out of them.   Mark Butler The Money School: https://moneyschool.works https://markbutler.com https://letsdothebooks.com   Jesse Mecham YNAB https://www.youneedabudget.com

Jesse shares his experience working on the YNAB books for the first time in many years, while YNAB's head accountant is out of maternity leave. Working through monthly and quarterly close  got him thinking about how software automation could free up the accounting departments time wrangling spreadsheets to do more impactful work for the business. To that end, he engaged Mark to consult on how YNAB can improve their accounting processes. Mark and Jesse continue with a discussion about the inevitability of change, and how employees and companies can position themselves to handle the disruptions that technological innovation create.   Jesse references one his oldest son's college courses, where entrepreneurs visit the class and deliver presentations on their careers and the future of business. On two separate weeks, two very successful entrepreneurs shared their thoughts on AI and how it is disrupting entire industries -- one had a very positive, excited outlook, the other a bleak, pessimistic outlook. The change is inevitable, however, so Jesse asks: which side do you want to be on?   You do have a choice.   Mark Butler The Money School: https://moneyschool.works https://markbutler.com https://letsdothebooks.com   Jesse Mecham YNAB https://www.youneedabudget.com

Recently YNAB announced a major shake up in the way it talks about money. Jesse explains how the realization that each of YNAB's Four Rules was really just a variation of Rule One ("give every dollar a job") led to a deeper conversation about YNAB's core identity. Every year when the executive team met to reasses the company's purpose and direction, the team would change the stated purpose of the company. It became clear that YNAB wasn't a budgeting app, and it wasn't a set of rules for managing money -- there was some self-actualization happening in users that wasn't being captured by the way YNAB presented its method. Eventually the team landed on the word "spendfulness," to describe a state of spending money with purpose and intention.   Jesse discusses how the company has evolved to this point, and where it plans to go now that it has redefined its purpose and even changed it's methods (YNAB dropped the Four Rules for the Five Questions).   Mark wraps up the conversation musing on the pursuit of leisure, and why he has such a hard time indulging in leisure pursuits.   Mark Butler The Money School: https://moneyschool.works https://markbutler.com https://letsdothebooks.com   Jesse Mecham YNAB https://www.youneedabudget.com

Mark and Jesse discuss the pervasive distractions that cell phones and computers cause, and how to fight back against them. Jesse champions the Freedom app blocker, which locks your phone or other device from distracting websites like social media, YouTube, blogs, etc. Since implementing Freedom, he boasts a phone usage time of only 20min per day (!), working toward his stated goal of "making the phone in my pocket feel weird."   Mark questions his propensity to continually start new ventures as part of an anxious reaction to having free time. He realizes that creating leverage in your business ought to lead to free time, which can be dedicated to hobbies and leisure. Without careful attention to cultivating hobbies and other interests, however, free time can become an empty vessel to be filled with more anxious activity.     Mark Butler The Money School: https://moneyschool.works https://markbutler.com https://letsdothebooks.com   Jesse Mecham YNAB https://www.youneedabudget.com

Mark and Jesse kick off the New Year with a deep discussion on inflation and how it creates confusion about the most important price of all -- the price of money.   Mark Butler The Money School: https://moneyschool.works https://markbutler.com https://letsdothebooks.com   Jesse Mecham YNAB https://www.youneedabudget.com

Following up on Mark's admission that he dreads collaboration, whether it's with peers or employees, Jesse discusses one way the leadership team at YNAB has fostered collaboration. They call it the strategic council, and it's a two(ish) day meeting with all the functions at YNAB presenting the challenges and opportunities for growth in each function. The meeting is tightly structured, with desginated time slots for each team to present and field questions. This is critical to keep things moving and keep the focus on getting started with solving problems. It's not a time to fully solve problems and implement strategies, it's simply a time to get everything everyone is working on out in the open, so that everyone is aware of the challenges and no one is caught by surprise.   Mark points out that this type of meeting has the potential to become toxic if teams are concerned about protecting their own reputations rather than being open with their challenges, and thereby use the meeting time to deflect problems and shift blame. To Jesse, this kind of meeting can only happen productively with high trust teams, who are all aligned with the idea that the presentations are a way to make the company better. In a low trust environment, the collaborative aspect of the strategic council falls apart quickly.   Mark and Jesse end on a discussion of collaboration as a way of buying back your time. Jesse explains how his personal assistant has not only saved him time by taking care of mundane problems for him, but has shored up the "mental leaks" that occur when your focus is distracted by competing priorities. Mark shares that despite his preference to use software over humans to free up his time and mental capacity, he has found an employee with high initiative and drive to solve problems on their own to be very useful.   Mark Butler The Money School: https://moneyschool.works https://markbutler.com https://letsdothebooks.com   Jesse Mecham YNAB https://www.youneedabudget.com

In today's episode Mark explains what makes the perfect diet coke, and Jesse opens his inbox and reads some comments and questions from Beginning Balance listeners, including tips for improving business leadership skills, how to keep track of all your ideas, and why studies can be highly misleading. Mark and Jesse also address a question about UBI, or universal basic income, and bring up Mark's old standby phrase: "incentives are undefeated."     Mark Butler The Money School: https://moneyschool.works https://markbutler.com https://letsdothebooks.com   Jesse Mecham YNAB https://www.youneedabudget.com

Jesse kicks off the episode talking about one of his new endeavours, Ultraspeaking, an effort to double down on one of his biggest strengths: public speaking. This leads to a conversation about embracing your strengths, the things that feed your working genius (see episode #102), rather than trying to build up your weaknesses. Mark shares his comfort speaking in front of audiences, and his fear... of not feeling fear anymore. In many cases, fear is an indicator that you're about to do something that will help you grow. The scary stuff, in other words, is probably the stuff you should be doing in your work, your business, your life!   For Mark, one of the scary things is actually commiting to playing to his strengths in his business, which for him means hiring people to do all the things he's not good at. No business can grow, Mark and Jesse agree, without collaboration of people all playing to their strengths. In Mark's case, identifying and plugging gaps in the business is satisfying work, but it's short lived when it's not aligned with his strengths -- it's really another form of procrastination, chasing the dopamine hit of solving a problem in the short term rather than positioning himself to do impactful work over the long term.   In this vein, Jesse discusses his big 2024 experiment: hiring a personal assistant. While he's still figuring out how best to utilize his assistant, Jesse finds peace of mind in the bandwidth that she creates for him. Knowing he can commit himself to new projects and teams without having to worry about scheduling and other life stuff puts him in the right headspace to focus on the things he's best at and the things most impactful to the business.   Mark Butler The Money School: https://moneyschool.works https://markbutler.com https://letsdothebooks.com   YNAB https://www.youneedabudget.com

Mark and Jesse are back after a short break with a discussion about slippery slopes... real and imagined. Jesse delivers an epic rant on the uselessness of economists, while Mark talks about his hesistance applying for graduate school in order to obtain the Licensed Marriage and Family Therapist credential.   Mark presents his dillema: he wants the credential to "reduce friction" for clients when other service providers refer him (say, a divorce attorney that refers Mark to a couple for marraige counseling before going down the path of divorce). Calling yourself a family and marriage coach, Mark reasons, makes you have to explain yourself, whereas the title of therapist is self-explanatory. On the other hand, he already has a busy coaching practice doing the same thing that therapists do, so the actual value of the degree is questionable (and the cost is high, in both money and time).   Jesse has a different take. In his mind, any friction that not having the official "therapist" label might create goes away with a strong referral. As soon as the attorney refers a client specifically to Mark, trust is created and the work can take place. It's all about the strength of the referral.   This leads to a discussion about credentials as a form of permission seeking, and the pricing power of a provider who offers their services as a non-credentialed coach versus a licensed therapist. In many ways, the people who become therapists have what Mark calls permission seeking traits -- they jump through the hoops in school to get the letters after their name, and when they start their practice they look to the rates of other therapists and set their own somewhere in the middle. On the other hand, coaches often position themselves in a more niche area at a higher price point, and command much higher rates.   At the end of the day, credentials may be another one of those slippery slopes -- something with more perceived value than actual value in the marketplace.     Mark Butler The Money School: https://moneyschool.works https://markbutler.com https://letsdothebooks.com   YNAB https://www.youneedabudget.com

Mark and Jesse discuss their most recent read, Never Enough: From Barista to Billionaire by Andrew Wilkinson, a one-time barista and co-founder of Tiny, a holding company that buys and holds businesses for the long-term (like Berkshire Hathaway). At the age of 36, Wilkinson found himself owner of a company worth over a billion dollars, and in a new stratosphere of wealth he had never experienced before. What he found, though, was that the same problems which pervade life in the lower economic classes are still there in the upper crust. The presentation of the problems are different, sure (the middle class aren't generally obssessed with yachts), but the nature is the same -- jealousy, covetousness, ego, etc.    Jesse shares his own experiences dealing with business and financial success while trying to stay genuine and honest.... while cracking some terrible puns in the process.     Mark Butler The Money School: https://moneyschool.works https://markbutler.com https://letsdothebooks.com   YNAB https://www.youneedabudget.com