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We're Never Going Back with Harley Finkelstein

Hey, what's up with your friend Chase here at the Chase Jarvis live show on Creative Live. You know this show where I sat down with amazing humans and I do everything I can to unpack their brains with the goal of helping you live your dreams and your hobby in life. Our guest today is Harley Finkelstein. You probably know Harley's work. If you don't know his name, he is the president of Shopify and why would I have this guest on right now here, as we're emerging from a global pandemic. It's because now is the best time in the history of the world to start your own business on the internet. Uh the platform that they've built over there is incredible. But mostly I wanted Harley on the show today to talk to you about how you can take advantage of this particular moment in time to either start or advance that side, hustle the psychology around how we spend our money and time the opportunity to provide equity and opportunity for underserved communities is the greatest all time history of the...

world right now, this conversation with Harley is uh it's near to my heart, it's special. It underscores the opportunities for entrepreneurs and the the entrepreneur mindset to have a disproportionate impact right now. So I'm gonna get out of the way and here's my conversation with Harley of Shopify. Yeah, No. Alright, Harley, welcome back to the show for is this time number two or number three? Do you remember second time? Second time time. Great to have. I think I get like get a gold watch on the third, but Chase, thank you so much for having me back. It was really fun to do it in person with you now. Of course we're doing it virtually, but I'm it's always an honor to be on your show. Well, it is a treat to watch where you and the Shopify team have come, not just uh since our last show together. Um but from the very, very beginning, I will remind our viewers that you have been friends for. I think it's coming up on like a decade. And I remember fondly sitting around a campfire uh like Tahoe, where you and Toby the the ceo of Shopify, we're talking about this big vision that you had and you were asking questions about how photographers thought about online commerce and stores and just to think of where you have taken this company and where of course, in a pandemic and ultimately post pandemic world, The world of shopping is completely transformed. So for those folks that the half a dozen who are listening or watching and do not, you know, you and your background, um give us the, give us the 62nd overview and and then we can start to rebuild from that camp fire in Tahoe to where you are today. Nice place to start a story as a campfire in like time. Uh, so I'm the currently the president of Shopify. I've been with Shopify now for about 11 years or so, which is about a third of my life. I'm in my mid thirties, so shopping is really the first job I ever had, but I started as a merchant. I was, I've been an entrepreneur since I was a kid. Last time on the show, we talked about my first sort of hustle, which was I wanted to be a DJ, no one would hire me. So I started my own DJ company And I've been using entrepreneurship effectively since that, since that, since I was to solve different problems. Uh, and in 2000 and six I was in law school, I need to make some money and ended up meeting Toby serendipitously at a sort of start up event in Ottawa where I moved to go to law school and ended up becoming one of the first merchants on Shopify. And what I, what Shopify did for me was it effectively gave me independence. It meant that I didn't have to drop out of school to continue my studies. I was able to concurrently go to law school and business school and also run a business and I practiced law for all of 10 months in 2000 and eight hated it. It was like the worst, worse way for me to spend my time, not for everyone, but for me it was the worst way to spend my time and called Toby and and asked him if I can join him and a couple others who were all engineers and helped build this company. And today we have you know more than 1.7 million merchants of the platform. About 9% of all e commerce in the U. S. Goes through Shopify. If you were to pretend that we were a retailer, we would be the second largest online retailer in America after amazon and uh it feels more so than ever before. That mission to help entrepreneurs spread entrepreneurship feels more important than ever before. Right now that is you just your last point There was the laser beam that I want to focus on for a moment here and why I wanted you back on the show because you know we keep hearing in the media, we keep talking you know at these you know I just had a two friends over social distance sitting 12 ft away from each other outside under heat lamps here in Seattle where it's still a little bit chilly just talking about, you know, this the idea of normal and what's different and what's changed and that is, it seems to dominate the media dominates individual conversations that dominates the thought patterns that I'm having as a creator and an entrepreneur. You know, what are you leaving behind? What do you what's new and what can you do? You know, how do you reorient for a different future than the trajectory we were on just a couple of years ago and core two, this is what you and Toby and the team over there, a Shopify have built and it is the future of buying stuff is forever changed and the future of opportunity and the opportunity specifically for autonomy for so many people who are watching and listening right now is as dramatically accelerated. So obviously you couldn't see the future, You don't have a crystal ball, but there's some element of what you've been building all along that if you've been digging your ditches, the way I talk about it as entrepreneurs were digging a ditch and you can either dig a ditch trying to chase the market, which is a losing proposition because the market moves faster than your shovel usually, or you can just dig the ditch of the vision that you have and ultimately the market, if you've done your job as an entrepreneur and listen to your customers, then you're digging a ditch in a direction that the market invariably will come around a number of times in your career to engulf what it is that you're doing and that's precisely what's happened. You didn't have a crystal ball, but how did you know where it was going and now that you're there, what do you see? I think we saw in the early stages of the company that for the most part, entrepreneurship Is deeply rooted in so many of our stories. You know, my father is an immigrant to Canada when he came here in 1956, his parents became entrepreneurs. They didn't call it that, but that that's effectively what they did. They start a little business selling eggs at a farmer's market and they did that until my grandfather passed away for like 65 years, entrepreneurship is so bad baked into the the fabric of society. And so there's never been this a surprise that people want to start business that want to create something from nothing. However, it was very inaccessible. Even my grandfather, if you think about that story of Hungarian immigrant during the Hungarian revolution immigrating to Canada, the amount of risk that he had to take to get this little effectively a table and an inventory to sell these eggs to consumers. He had to leverage mortgage's entire life. So the cost of failure of entrepreneurship has historically been really high. And then you add on to that A lot of the technology that came out of the 90s. Yeah, it was great technology, I mean it really did allow for this democratization of distribution of retail, but it was out of reach for most people. If you did, if you were not an engineer and you didn't have a couple million dollars, it was impossible for you to build a beautiful, scalable online business. And so that premise was what if we gave the same tools that traditionally what the only the biggest companies are able to afford, what if we gave them to everybody, what would that look like. And over time we've been increasing the supply of these entrepreneurs, the direct to consumer brands, these small businesses and help giving them a home. Um and then uh sort of simultaneously the demand side is the consumer side consumers. Also, especially during the pandemic, we can talk to the pandemic in a second, but consumers began in a very different way to start voting with their wallets to support these independent brands. And so I think you're seeing today as we sort of zoom out for a second is a complete paradigm shift in retail and commerce and it's driven by the fact that people on the, on the supply side, anyone that has a great product or a great service can now access a global consumer base at very affordable pricing. And then on the demand side, consumers would prefer to buy all birds and bombers and Tommy john and kylie cosmetics and jim Shark and all these companies that didn't even exist five or six years ago. And so the meeting of the supply and demand, I think is what's creating this incredibly frankly inspiring retail landscape environment that we have not seen since. You know, the baker used to sell his own bread or her own bread and the cobbler used to scare their own shoes. Um it's a very exciting time. And and yes, we're in the middle of a global pandemic right now and there's a lot to be anxious about, but there's a lot also be optimistic about and in many ways there is no profession or self identity that is more resilient than entrepreneurship. And I think that's the reason why you've seen entrepreneurs, people that self identify people that have entrepreneurial instincts do quite well in the middle of a global pandemic in a way that I think it's surprising a lot of people underscore that point by the fact that I've known so many people in this time period, You know, we've heard the stories of great businesses are often built or started in the downturn and you know, at least as we check in with the creative live community, we just did a survey out to a couple million people and the answers we got back for the tools they want and how creative life can help them just they basically resonated with exactly what you just talked about. There are people who look at this as their full time job, but so many people now are doing this as a side hustle. There's something like, I can't quote Canadian statistics, I apologize in advance. But 70 million americans have a side hustle where they're making money outside of their primary occupation. And you've got to think of this as a hugely inspired spurred on, made possible by these these online tools. So the question is how much of your business of Shopify is universe? Or as you know, an online retail expert, If we just, you know, couch your experience in that title for just a second, do you see this more people having these side hustles or stores on the side of what they're actually doing? Or is this the fact that there are so many tools and this is available and affordable and an easy option to set up in a matter of an hour. Does that mean we're going to pull more people into the 100 self employed universe? What's the what's the end that you see? Well, let's just, I mean let's let's use let's let's use some us numbers and stats here. So in Q. 3 2020 The. US. Census Bureau has stated that there were more business registrations in that quarter. q 3 2020 than any other quarters since 2004 at the same time. If you look at google trend reports, just for the term start a business, you are seeing a complete spike in that as well relative to the last 15 or 20 years, The highest spike proportionately on google trend reports. So there's no question there's an appetite for. Do you think about why are more people doing it? Well, yes it is easier. The tools are better. But also I think what people are realizing is that they want to have control of their own livelihoods and if they if they have a job but they now have reduced hours because of the pandemic. They're looking to supplement their income if they've lost their job, they're looking to replace their income. But what actually see what I see and again this is a little bit of a future um foreshadowing for what we see in the future is what if everyone that has hobby? Everyone that makes something that is a value to the world? What if every one of those people commercialize that hobby? What if everyone that made uh my wife just maybe lunch today, she makes the most delicious chicken soup? Like Lindsay is actually an ice cream entrepreneur. But what if Lindsay also decided to commercialize her chicken soup that she makes and It takes like four days and she uses like eight different chickens. And she has these secret recipes. And what if everyone that has a hobby? Everyone that has a workshop, a wood shed, a little station, their garage where they make cool stuff. Um people that are packed, my grandmother has been making our kids these beautiful blankets. What if every one of those people replace the term hobby with venture with entrepreneurial small business, something of that nature, What would be the end result? And so I think, I think it's coming from both angles now. Yes, it is easier now to do. So it is less the risk of version or the risk tolerance you need is lower. The cost of failure is lower, but that means that a lot more people are trying it. And so actually building a very, you know, successful business is also quite complicated and it's, and we shouldn't glamorize entrepreneurship. It's still a difficult task, like, and I'm a card carrying member of that club that, you know, I've had a couple of really cool business that I built, but I've also had a ton of failure and and you know, mostly entrepreneurs around me, yourself included, I'm friends with, we've had a lot of failures, so it's not an easy thing to do. The difference is that if you try something now and it works, you can scale it and you can build, you know, Ben Francis, who I think, you know from Jim Shark, I think you may have to build a business that's a billion dollar company. It didn't exist seven years ago. And now that is being looked at as a real competitive threat to the likes of Nike and under armour. I mean that is that is mind blowing that in such a short period of time, this scale can be built. So if you try something and their scalability, if there's an opportunity to scale, you can do. So the flip side is, if it doesn't work, you also can try three different other things and see if one of those things are going to be, be successful. So the way that we think about Shopify is that we want as many people that have ideas in the shower in the morning to try their hand at entrepreneurship, make it really, really accessible. We know that not all will succeed, but the idea is that the ones that do succeed will eventually scale faster and more effectively than any of the predecessor companies that have been built frankly in the history of the world. And so that I think is what has changed now. And I also think that this connotation of entrepreneur, um, you know, for a long time, my wife was not Lindsay would not call herself an entrepreneur because she just didn't feel like that was, that was a brand that, that she, that she was, that she was able to self identify with and I think we're now making it more accessible, inviting more people in to say, hey look, this entrepreneurship thing, it's not just a great way to make some money, it's also a great way to self actualize, to share your gifts with the world, to create independence for your family. Yeah. Mhm Those last, you know, those last few bullets there and I think understanding how Lindsay identifies and understanding that so many people now can actually own that moniker or at least rent it as you said, and give things a try and if it doesn't work great and if it does work, then, you know, you have an opportunity to scale something that was once not scalable um how much how much value do you all place on the concept of an identity? Because it seems like, you know, when I used to ask people like what do you do, and as I was trying to build and conceive of creative live, like how how can we help these people? And it just occurred to me how strong this concept of identity really is in driving human actualization and accelerating potential, and if you call yourself these things that that is that actually frames so much of how you operate in the world, and then the contrary, for example, if someone wants to say quit smoking and they say I'm a smoker who is trying to quit versus because, you know, their identity is couched in in smoker versus identity, in like I'm a health nut who's managing addictions that distract from that, this is the flipping of that. So, as at, you know, again, you're coming from the Shopify perspective, but I look at you as just having a a Wider Purview, your, you know, so much about online selling and entrepreneurship because you have 1.7 million entrepreneurs as your customers. So how much what role does identity play? And how do you feel like that has been shaped or reshaped across since the last time we talked maybe a year ago when the number of customers were last time it was 600,000 and here we are at 1.7 million. And that was almost it's almost three times what it was last time we spoke. Which is which is which is why actually, you know, there's a lot of really great stats that I love to quote. You know, our revenue is doubling, our G. M. V. Is doubling. We're now the second largest retailer in America, were 9% of total league. All those things are really cool. But the actual number that I actually, I by far if I was going to a data point tattooed somewhere, the number that I actually think is the most important is the fact that every 28 seconds a new entrepreneur on Shopify gets there first sale. And the reason that I believe in that, that I think it's so important is because that moment when you get your first sale, that moment is when meant for many of us, everything changes. That is the moment where your identity changes, where your self confidence changes, where your audacity changes. You now have been brought into this new box, this new area of opportunity and and and sky is absolutely the limit to that. So I know if you if you were to go to social media, you would ask the sort of the twitter philosophers is identity important? You get two different schools of thought, One school of thought would be never be attached to any identity or have very lean identity, very light identity. So you can swap those things out. But the identity of an entrepreneur to me has been so valuable because it colors in a very positive, constructive way, every decision in my life. It colors how I parent and how I treat my relationship with Lindsay. Uh it colors how I learned how to play new sport like mountain biking or tennis, it colors how I do my job as the president of Shopify, even colours, how I have relationships with people that I deeply care about. To me, this idea of the entrepreneur identity is simply a very resourceful way and a very um high impact way of solving problems and that's the reason why I think, you know you're in the same boat, you know, I've talked about this, but when you when your Venn diagrams of your personal interest and your professional interest overlap that my friend that is life's work and if you can find that where the thing that you would do if you never have to work again or just, you know, you're welcome to saturday morning, I want you to make fun. If that thing you would do on a saturday morning is the same thing that you feel you have to do on a monday morning. There's nothing better than that. And when you talk to entrepreneurs, you talk to the merchants on Shopify or you talk to chase or or me, you get that sense. I feel that I'm doing my life's work in the way I notice because those things are totally lined up. And I think Shopify really is is the answer to this, you know, is the answer to this question, which is what would happen if everybody who wanted to or needed to were able to start a business, what would that look like? And I think you create quality that way. I think you you you have a more level playing field. I think you get people to be a lot more creative and move away from A traditional 9-5 that people wait to retire from to then go and do their life's work. They can do their life's work during their life. That I think is why entrepreneurship is such a powerful concept. It's just it's crazy the emergence of it. You know, the entrepreneur used to once mean you went to Silicon Valley and raised a round of financing and now that it's um made its way into every sort of nook and cranny of popular culture. You talked about it as an identity around being able to solve problems and start new things. And I truly, I think that's part of the the why I asked the question because it's almost like it's the sensibility, uh quality Inn approach to life and it, you know, it happens to have a manifestation in business, but this idea of I can solve problems, I can iterate and test and um I don't know, it's amazing, right? And actually, you know, I'm glad you mentioned Silicon Valley for a second because one thing that I think most people completely misunderstand about an entrepreneurial journey is that everybody's definition of success is totally different. I had this really cool thing that happened this summer, I was on a tv show on Discovery Channel is called I quit, I was one of the three stars of the show, quote unquote. And uh and what we did is we, the whole concept of the show that we did. The Discovery was We would take people that had side hustles that full time jobs that they didn't really love. But they had these side hustles and we would work with them throughout the course of 10 episodes and we would try to convince them to quit their full time jobs and pursue their, their side hustles. And when you so I went, I mean this was filmed two years ago, pre pandemic, but it aired summer 2020. But so I got a chance to spend a lot of time in person with each of these companies. And when you ask them why they started, every single one of them had a completely different answer and none of them was, I wanted to make a boatload of money. One of them grew up, his name is Mike D, he's a barbecue sauce company. He lives in Durham north Carolina and he had never met anyone that ever had a family business. And this idea that his daughters would have a place if they wanted to to go into as this, you know, this, this opportunity, this potential opportunity and have that flexibility to have a family business to go into. That's why he started. In other case, there was a company that made these beautiful Brazilian chocolates called Brigadier arose at a new york city and they just were obsessed with sharing this delicious chocolate with the world. And so one thing that gets I think missed of an entrepreneurship is that the goal of entrepreneurship for some maybe bill, build $100 billion you know, company and take it public and, and and raise capital. Do all those things for others. It's just a way, so they don't have to work at a job they don't love or it's a way for them to inspire their Children or its way to give their Children opportunities that they never had. And that is why I think that the term and the brand of entrepreneurship is so powerful because it's an accelerant for anyone specific ambition and all those ambitions are gonna be different. What's the ratio of ultra small? I just I'm have a hope to the answer to this question but I'm not attached to it. Um What is the relationship between the number of small solo preneurs or ultra small business? Um I don't remember the I think the S. B. A. Has a term for this in the US. I remember what it is right now but on your platform, if it's just as a data point relative to the massive stores, is it You know, is it 5050? Is it 90 10? What's the relationship between mom and pop? Small, one single digit person companies to mega brands? It is um it is by far the vast majority of Shopify merchants are sole proprietorships and that's from you're looking for. Uh the vast majority are these independent single person businesses. And the reason that I talk about all birds or bomblets or gym shark fashion, nobody these companies is not because those are the ones that that we care most about. In fact just the opposite. The reason that those I raised those brands is because it's important for people to know that all of those brands started in some cases their mom's kitchen table or a coffee shop. They started as sole proprietorships and have been able to scale quickly in a way that business is not traditionally been able to scale In the history of commerce, which is effectively the history of currency, um, but this idea that every 28 seconds of brand new entrepreneur gets there first sale, that to me is really why, why show up every day, that's really why I do my work now. What's also fascinating is that these very large established brands like Heinz, ketchup, or Chipotle, or lindt, chocolate, or Herman Miller or Stetson. Um what has happened the last couple of years is we started to see these mega brands come to Shopify as well and begin to sell direct to consumer. And when you, when you sort of ask these questions as to, you know, why Shopify, why are you thinking about doing this now? What's happened is these smaller direct to consumer kind of startup brands have made competition uh and created this competitive landscape, such that the bigger brands actually need to act like entrepreneurs as well. And in some of these companies, what you see is, it's fascinating in some, some companies come to us and say, okay, great, we want to bring our massive, you know, brand onto Shopify and we want to participate in, you got to participate in RFP process, it's gonna be a six month sales cycle, and we just say, no, we don't do that stuff, We don't, we're not going to go golfing with you or, or have steak dinners with you to community. That's just not our model. However, we will give you the software in which you can build your own store. And it's, it seems to be that in a lot of these cases, there is someone in those companies inside of these big CPG s um who is an entrepreneur or entrepreneur who comes to us and sometimes just put down their personal credit card, just signs up the business for a Shopify store and it's cool to see actually some of these companies, not only act entrepreneurial but have success, is being entrepreneurs. Heinz ketchup is selling direct to consumer, I mean like you know, Schwinn bicycle is selling direct to consumer, these are companies that realize the future of retail is completely different than anything that they've been working on and they want to enter this sort of the same strategy in the same model as you know, that solo entrepreneur in Durham north Carolina. All right, I want to simultaneously close one chapter of our conversation and open another just based on what you just said. So the, the my hope behind the question, the prompt there was that it was going to be the case that, You know, it's 90, it's probably like 99 1. The number of solo preneurs to sort of mega brands in terms of a number of stores. Yeah, it's vastly the solar produced. And so the message to those listening and watching right now is you're not alone. Like this is a, this is a time in history where the tools that you have at your fingertips are the same or better than the tools that so many of these mega brands had and as evidenced by them coming to use these tools. And so if you were ever hesitant about your ability to do this, know that 99 out of 100 or whatever the rough I'm putting stats in your mouth, so I'll be careful to qualify that. But imagine 99 out of 100 people who are doing this on platforms and Shopify and platforms like it just like you, so you're not alone, not just that, you know, people going to think that I set you up for this, but there's no setup here. I started the conversation by saying, well, if we were a retailer would be the second largest retailer, uh that's a cool flex. That's not the reason why I care about. The reason I care about is because when we go in to negotiate payment rates on like on merchant account, so the ability to transact credit cards or shipping labels, the shipping companies or capital rates or fulfillment rates. When we walk into these negotiations, we do. So as if we are the second largest retailer, bigger than best Buy and bigger than Target and bigger than walmart dot com. And that's because of that, our scale. But rather than keep those economies of scale for ourselves, we can actually give those to anyone who's signing up for Shopify. So in terms of, you know, not only you're not alone, but for the first time, maybe ever, um the deck is beginning to be further stacked in your favor as a first time entrepreneur, because the rate you're paying on payments or your ability to access capital or your ability to do two day affordable shipping is effectively the same as if you were a very well established retailer and that never happened before. It's incredibly, incredibly cool. And again, the reason I'm going to just go back to the top of the hour here, the reason that I wanted you to come back on the show is because in the last year online retail and every creator and entrepreneurs dream of selling their products out in the wild to random buyers, in whether it's across the town, the country of the world is more available to you now than ever before. So that's the why that's the why you're on this show today. And so thank you for representing that, that all that, you're not alone. If you're out there thinking about man, I'm really wondering if there's no downside to putting the, the quilts that you're making on the internet and trying to get a sale, even if it's just to fund the next yarn purchase or to put your books or to our mutual friend Ryan Holliday cells. You know, he's got a great story at the daily stoic dot com where he sells limited edition books and I just got his, he just sent me his leather bound what is beautiful? It's like comes this beautiful box since leather belts, gorgeous. And that's through Shopify as an example. So, again, I I want to put an exclamation point on on that and then I want to open up a new conversation with a new topic focused on something you just said a moment ago, which is in my notes here at a place where I wanted to take the conversation. So thank you for the perfect segue. And it's to be able to, as a creator or entrepreneur have a direct relationship to the customer in a world that you historically have not. And you cited the Schwinn bicycles and all these most consumer packaged goods and most brands that you talk about historically have had to have a distribution channel where there were middle men and women taking a cut and owning the relationship with the customer. And now that's arguably one of the most valuable attributes of not only do you get the scale, it's sort of like amazon had a W. S. And so now as a is a web person, I can go put my website on, you, get the same scalability that some mega brand has. But now I can also own the relationship with the the 1000 true fans to cite kevin kelly or the people who most love whatever it is that I'm doing or you who are listening are doing right now. So pontificate, drop some, drop some knowledge on me around this. The ability to have a direct relationship with your fans, followers and customers a quick retail history lesson. Um, this idea of a direct relationship from maker to consumer was retail and that was the town square of the olden days. You went to the town square where all the merchants were and you as a consumer, bought your bread in your shoes and all the things that you need to find. And then around the late 1800 1876, this guy named john wanamaker in philadelphia Created the 1st Department Store and this idea was, he is going to go ahead and curate a bunch of different products under one roof and you, as the consumer, you can go and you can buy shoes and bread and everything you need in one single place. And that was the introduction of intermediation of this idea of having an intermediary between the maker and the consumer. And for the most part, retail has basically been the same since wanamaker's was created. It's been a lot of intermediation and there's a lot of value to that. I mean, one of the things that you get as a, as a maker of creator with an intermediary is that they are responsible for bringing consumers to your products, but you are not actually, you're renting customers, you are renting the business from that intermediary. The customer belonged to the intermediary, not the maker, not the brand. And the reason that that was valuable from a consumer perspective was not every maker. The baker couldn't put up stores all over the world. So for the baker to sell their bread to different stores in a wholesale relationship and then have the intermediary resell it and consumer, it was valuable for all parties. Now there is an agency problem. The agency problem is in some cases, these intermediary said, well wait a second. We can just make our own bread. We don't need to use the baker's bread. We have the consumer, we have this distribute distribution centers, which are stores, we can just do it ourselves. So, one issue is the agency problem. The second issue, though, is that there was no choice. Distribution happened through stories. The reason that you and I would go to A best spy or a Gamestop 2030 years ago is because we couldn't go direct to the game maker. We couldn't go directly to the T. V. maker. We have to go to one of these department stores. And then the internet happens. E commerce becomes a reality and it just takes a sledgehammer two distribution to democratize the distribution. And it says anyone that has a computer and an internet connection can now access a global consumer base. And so this idea of direct to consumer being this fat, it's not a fad, it's the way retail should have always been. It's just that it was difficult to do distribution. It was difficult to access a global consumer base and e commerce allows for that. And so what you're seeing now is going back to the earlier part where I talk about all these retailers, excuse me? All these merchants, all these makers were in the town square. Well, the digital town squares of today are social media and its marketplaces, and it's your own website and it's even some physical in person, in real life, stuff too, like your physical store. And so I think what a maker or a creator emergent needs to think about today is where are my consumer spending their time? What is the digital town square or the proverbial main street in 2021? And what we're trying to build for them is we're actually fairly channel agnostic. Yes, we shop that you get this great online store, but you can also sell on instagram and you can sell on Pinterest, you can sell on walmart dot com and you can sell on you never have a tic tac, and you can sell anywhere you want online or offline. Um but what's happened is that because the relationship between the creator and the maker and the consumer is now direct, it means that from the consumer perspective, the experience is better from the maker perspective, they get to keep the entirety of their margin and they own the consumer relationship. So, I mean, you can just peruse any any magazine or any blog that talks of retail or commerce and you'll see countless articles around the innovation that is direct to consumer, but direct to consumer is just, it's what it's always been, it's what it should have always been, except that at some point it got too difficult to do distribution and now it's not. And so it is not surprising to, I think in the future every brand will either be a direct to consumer brand or will have a major piece of their retail operations, be direct to consumer. And the best example I can give you is Heinz ketchup, which nobody ever thought that they would buy Heinz directly from Heinz to go or hinds at home. Uh they, it's a grocery store items And you will still buy it in a grocery store, but if I know that my family is obsessed with ketchup, I can just go buy direct from Heinz and I can buy a case of 12 ketchups and mustards and now I have it and the experience is really actually quite great to buy directly from them. So that I think is not only a better business model, but it also takes care of the agency problem whereby um the business model of great companies like Shopify, I think uh and other others like us, we are only successful when the merchants are successful. That is very different than what you would see in an with an intermediary or department store. Where the the relationship can be somewhat adversarial undoing that adversary. The distribution. I remember even maybe a decade ago I had some insight into Nike's ops and there the relationship that they had with their distributors was very, it was very tense because the distributed like something as large as Nike, right? And when they switched to go direct and then, you know, not that, you know, not not all that long ago. It was, it was very controversial and they're all of their distributors were up in arms and and then they created the Nike stores and distributors or the other like, you know, let's just use Footlocker for example, I know nothing about foot locker, but as example, how can you compare the experience of buying a pair of Nikes in the Nike store versus in the foot locker store, you walk into the Nike store, it's a museum, it's a carnival. It's an experience. It's rich and interesting and and the art on the wall and the music that is playing and the education of the staff is so, so great. Compare that to buying it from some random retailer that sells Nike across and other products. As a consumer, you're not going to, I feel that's a better, a better experience. You're always going to the Nike rap, and I think that is a great example of of where it's going, retail is going to get much better from a consumer. It's also going to get much better for the brands. I think that's a key takeaway if you're thinking about this, you know, for your own world, like do you want to own that relationship? Do you want to control it and control with a small C because, you know, ultimately you're you're you have the opportunity to influence, but you get to have a relationship where your fans and customers get to directly tell you what they think of the experience, how they would like it shaped and that like, that's a, a flywheel almost. You create something for your your 1000 true fans and they give you feedback and then you tweak the like, that is a relationship and a very powerful I think vehicle that cements the experience and relationship and so many things we've been talking about and that that 1,000,000 true fans blog post, which I reference all the time. I think it's an amazing piece of, of, of, of understanding of how the world operates. If you're starting a business today, your goal should not be to sell a million dollars in 12 months, maybe that's a side goal. But imagine there are 1000 people who truly love your brand, love your story, love your products. I was talking to Rebecca Minkoff is one of our merchants on Shopify five days ago, like late last week. And she said that in the early days of Rebecca Minkoff, when she had, I think her first bag that she got famous for was called uh the Morning after bag. Uh and the reason that she knew she had something there was, she was, she would just go on different blogs and listen and and and watch how people were talking about the bag. And at some point she just went on and said, hey, what do you want next? And they're like, well can you change these colors? And Rebecca Minkoff, who's sort of the modern day fashion american fashion house, one of most successful brands in America. Um the way that was built was not by building $100 million business per se, right at the gates, it was actually built around getting feedback from a very small pool, a very loyal brand, people who really cared about her product. I love that way of thinking of building. I vote with my wallet direct across the pandemic and I would say before, but it was radically accelerated and amplified when the pandemic hit, Who do I want to see? Not just survive, but thrive in a post pandemic world. I doubled down on the local restaurants. I mean I take out meal kits, whatever they were given you literally anything they were selling I was buying and because I was in a position to do that, to support them and I understand and acknowledge that others may have not been because this has been a really, really tough go. But the point that I'm trying to make is that we now have an opportunity to vote with our dollars. And I'm just curious what your lenses on the future of that as a primary mechanism for economic growth for um equality, equity. Um, you know, I invested in a lot of art from the by pocket community across the pandemic as well. And I'm just curious to hear your view on how important or unimportant if I've got this wrong, the Opportunity to vote with your wallet is whether you are on the consumer side, which is the side that I'm are ticking articulating this point of view from or if you're a shopkeeper, a merchant or you want to put your stuff out there in the world and make something for your 1000 true fans. What you're hitting on is unequivocally a new thing that has happened through Covid or accelerated through Covid that will continue long after the pandemic is over. Which is that wherever you live, small town, big city, our communities, I think we have all realized it's become so apparent that the reason our communities are interesting, they have character, they have culture. It's a lot, a lot of that has to do with the local small businesses. You may laugh that the dry cleaner doesn't add culture. But if you have a relationship and a dynamic and friendship, you know, even casually with a dry cleaner, it does make it interesting. I know I will just use that as an example. Kwon is my, my dry cleaner and every time I walk in there I'm like what's up? How you know, we have a relationship and it's reasonably superficial because we're not like, I don't know really well by the way, that, that right there chase, that's what makes communities and cities and towns interesting. Those dynamics, those micro, you know, as superficial, there may be those micro, those micro dynamics you have with all the people that operate the small businesses, the bodegas, the nail salons, the coffee shops, the restaurants in your community. And I think we as, as humans who live in these communities, we just realized if we want our communities to be as interesting after the pandemic as before and maybe even more so we have to support them. So this, this thing has happened where we have all decided whenever possible. Um, and I'll add a caveat to that, which I'll explain in a second whenever possible. We want to buy from local businesses we want to buy from are the people that operate these small businesses in our towns and I don't think that's going away. I think what's actually happening is for a long time, it was actually fairly difficult to, um, I don't know, but you know, your town, but here in Ottawa, some of these restaurants that I love and my wife and our foodies, um they didn't do delivery, they didn't do meal kits. They actually kind of were pretty shitty and things like even taking reservations. But what has happened is the pandemic has created this catalyst where they all had to figure out how do I digitalize? How do we do meal kits? How do we do take out? And so they've actually made it easier for us as consumers to vote with their wallets to support them. So what you're saying is absolutely going to be the case. And we, we've done a ton of surveys across more than 10,000 consumers all over the world, and more than half of the consumers tell us that they prefer to buy from local business, whatever possible. The other thing that has happened is, you know, going back to that first, you know, when when you and I fell in love or campfire in like Tahoe, someone else was there with us. Uh and he was part of that, that same group was it was blake from, from Toms Shoes. And the reason that Tom shoes was so dramatic and so interesting was there was this incredible benevolence, see to the purchase, you voted with their wallet to buy these shoes. And as part of that vote, someone else who needs shoes also got a pair. And a lot of people thought that was neat marketing and that was neat branding. But the truth is what that was exposing was this idea of conscious consumerism and conscious consumerism is now no longer a niche thing that only very clever entrepreneurs use to create social good and social enterprise like blake, but also it is now something that almost every consumer considers they want to know is the place is the store, is the merchant, the brand they're buying from? Their values, reflect my values. Do I see a connection between what I care about in the world and what they care about? And so when you couple this idea that we want to support local businesses and that's not going anywhere, in fact is increasing and the fact that we as consumers actually want to buy in a way that feels like conscious consumerism. Uh what you end up with is an entirely new way to purchase. That actually is, you know, and this is sort of where you separate buying from shopping. Um If you know there are people they want to buy, you know some toothpaste or they want to buy detergent, they may go to the quickest, most convenient place possible because it's almost like a commoditized purchase, it's a utility purchase, it's a transaction, that's all it is, it has no meaning to us. Um but if they want to do some sort of shopping where they want to look at the amazing new brands, they want to look at a catalog, they want to have an experience. They're almost always going to seek out more independent brands, more local brands, more brands whose values reflect their own. And that is the paradigm shift that I'm describing, which we are never ever going back away from. This is the future of retail we're describing here. Yeah, I was I got a moment of describe it as chills, but just the fact to uh folks at home, I wish you could have been there around that campfire, you know Toby and Harley and um blake myself. It was a, was a really interesting and special special time where if you could have been a fly on the wall, what you would have seen is the future of so many of these things that we now take for granted and I think you know, I'm just aware of the, the capacity that each of us has to, each of us have to truly effect the the world. Like you're sitting there thinking about, I'm just sitting there thinking about and there are so many people right now who are listening and watching that this is a message like don't you know, you don't sure you could want to be a fly on that wall at that camp fire, but you that that camp fire is in your front room right now. That camp fire is in your local community. The people that you were seated across the table whether physically or virtually are part of the next generation of the businesses and you have your voice, your ideas, these things matter. I'm just looking back and and while there are, you could say there are special things about each of us. There is also nothing special about that group. Just a bunch of people who are committed to innovating and trying and failing and and that's just like, you know, wherever you are right now at home in your underwear in Ohio or Ottawa or Ontario where I don't know anymore. Oh towns. It's a name. I just but that's but that also describes something that we've talked about before which is this idea of building your own tribe. You're your own community, wherever you are. It can be virtual, it can be on the Internet, it also can be in person. But one of the things that, you know, I, I one of the things I've been very fortunate, I think you, you share this as well chase that I've been able to find like minded people on similar journeys, completely different venues and verticals and industries. But what we share together is this idea of a deep, deep frustration with the status quo. Um, and also this deep ambition for how do we make things much, much better. Um, and that's the reason to take this full circle that I think identity matters because one of the reasons that I think we were able to connect is you're like, well, hey, I'm chasing like, hey, I'm here live an entrepreneur entrepreneur to, we immediately became connected even though you are far more, you know, you're more creative than I am. You're far more right brain than I am. You think a lot more about makers and creation and, and the arts and photography. And I'm thinking about like, you know, software and technology, but where are our Venn diagrams overlap is on this idea of ambition and being completely unsatisfied with what is currently in front of us. Um, that I think is such a neat thing. So true. And my man, you're everywhere right now. Like you and Toby, I'm like every podcast, uh, you're, you're, you've been on mad money with Cramer every time. I like, I don't know, I walk past a television somewhere or whatever. I'm like, Hey, my man occasionally throw you a text hoping that it's in real time and you're going to, your phone is going to be buzzing in your, it often is in real time, it is, it is often in real time, Yeah, absolutely, um but why is that, I mean why is it just is at the moment in time that we are at a tip, is it a tipping point like, but you know, you stand for something and what is it, what is it that you stand for? I don't think enough people understand the accessibility um that is available today too, do the thing you want to do to find your life's work to become an entrepreneur, start that thing and you know, you we live and I'm sure a lot of people listening, a lot of us live in these very entrepreneurial bubbles, I mean if you know creative live, you know, you know if you listen to chase Jarvis, you're constantly hearing about incredible stories of aspiration and inspiration, but remember that entrepreneurship still, it's not something that feels accessible to most people and one of you know, one of the things that I I hope for Shopify is I I think we have the opportunity to become the entrepreneur company, um there's no entrepreneur company, there's no company that, you know, if you think of a search, there's a, you know, there's one company that really has organized the world's data and made it easy to define, which is google, I think what social, there's a couple of companies doing it, you know, facebook has certainly done one of the best jobs of that as well, um but there's a company that really owns, the idea of connecting people in a digital format, but there is no company that is the entrepreneurship company and one of the benefits of us being um larger and bigger and a little bit more well known, and I say a little bit, not not not not with any false modesty, but because, you know some circles people know Shopify and when I'm talking to communities of people that are very entrepreneurial and very, you know care about small business, they've heard a shot by, but most people do not know that this thing is available to them, and I see it all the time when I meet someone or someone sends me emails, I want to start a Shopify store, but I can't afford it, or I don't know how to code and explain, well, first of all, um there's this amazing trial to get just to play around, also it's $29 and also if you know how to use email, you can build a business and it's not even about Shopify per se, if they decide to go start a business on another platform, that is okay. This idea that more people become entrepreneurs, that there are more voices participating in this, in this journey of business creation that I think is really important. It's even more important now, because whether you believe Shopify is the entrepreneurship company or not, it's tough not to believe that the backbone of the recovery of this whole pandemic and that the future of business looks like small businesses, so I it would it would it would feel I wouldn't be doing justice to the mission if I didn't use every opportunity. We didn't use every opportunity. Shop like to tell the story of the 1.7 million entrepreneurs on the platform, specifically those that didn't have a lot of money that had no connections, had no network, didn't have, you know, well to do parents, um they were just regular people who decided that they wanted to share this thing with the world because they had this thing they wanted, they wanted to put food on the table or they wanted to give their kids a family business to go into or they wanted to share their delicious chocolate with the world and that's the reason why we were trying to use all of these different ways. Do we have a T. V. Show or a documentary that came out literally a week ago on Disney Plus it's called In the Room and tells the story of like these young entrepreneurs, I mean these are teenagers who start these businesses and they compete in the global entrepreneurship competition and it doesn't say Shopify once the entire documentary and that's perfect okay for us because what we hope these documentaries on things like Disney will do is they will maybe inspire one more person to consider entrepreneurship and then one more person may inspire to more people. And ultimately, if there are more entrepreneurs in the world, things are going to get better things will be a lot. Um, it'll be a much better world for all of us to live. And I know that sounds very mother goose, but that's true entrepreneurs do make things better in my in my view. Well, underscoring all of this is the concept of equity, right? And part of what when the pandemic hit creatively, I was like, well, we're in a position it may perhaps a unique position to help people in this moment, because they need skills now, more than ever before, they need community Now, more than ever before we made a bunch of health and wellness classes free in order to help mental health, physical health people were trapped inside. And it occurred to me that that comes from a place of privilege. And here you and I are talking about it ostensibly there it is privileged to be able to talk and think about this. But how what where do you guys doing specifically around helping communities that are disproportionately affected by the pandemic? And we get creative live are rushing to do everything we can and to learn as much as we can. I'm just wondering if you have some ideas um, for those out there who are desiring to serve these communities, you know what some of your ideas are, How you guys are approaching this problem of access uh to education, services, opportunity. Clearly, you've got a very accessible platform. I'm just wondering what are some of the thought patterns that are happening inside a Shopify that we might be able to learn from? It's a great question. There's some very tangible ones. So we've now given out about $1.7 billion dollars of loans to merchants on the platform. Now again, I don't say that as a flexible because these are traditionally people who could not walk into a bank and get a loan or a cash advance and if they did, the rates would be astronomical because of the risk that that these banks would be taking. And so things like Shopify capital fundamentally put money into the pockets of these entrepreneurs on Shopify who could not get capital otherwise and that that, you know, that allows them to spend money and inventory and marketing and build that business even further. One of the things that I'm probably most proud of, actually two things, um we have this thing called the Shop at the shop Out is this shopping assistant for consumers. It's any given day, top three or top five most popular shopping apps in every major appstore. Um and there are, there are two tabs there to discovery tabs in that shop. At one app is uh you can discover local businesses in your community. So we just geo locate where you are as a consumer and we will show you local businesses in your area where you can purchase from. And the second is black owned businesses where you can find businesses owned by black entrepreneurs. And the reason is like their access is just, it's simply different. And in order to level the playing field, you have to also understand what each playing field currently looks like. And so by doing so, we simply expose more consumers to more black businesses, more black business owners. The third thing that, that I think is is I'm probably most proud of is a couple years ago I met a guy named john Hope Bryant who's creating Operation Hope and we spoke a lot about this idea of um he was sort of banker of the year, but a very prominent figure in the African american community based out of Atlanta and his view is that financial literacy is a major, major catalyst for equality and entrepreneurship and building a business is a major catalyst for, for equality. And so we created a program six months ago called one M B B one million black businesses and the entire goal is to create one million brand new black owned businesses on Shopify and we do so by education, we do so by giving them resources. We also do so by creating these role models in different communities, particularly in the US where one person who has built a successful business as a black entrepreneur is now able to act as a flywheel and a distribution channel for many others. And that idea that having more role models in the community creates more interesting, maybe I'll do that same thing as well. Um, we're probably not doing enough still. Um, but we're doing things that we think can have a real impact and one million black black businesses is one of things that I'm most proud of. I joined the board of that organization a couple of weeks ago because I just, I felt so compelled to say this actually may create real change and create change. We must. Um, man, that was a fast our yeah, um, it was fun. I'm really glad you invited me back on change. Just the landscape has changed so much, the opportunities are so ripe, the amount of um, I think they just sort of like pent up, what should I do with this next chapter. So many people are introspection and fuel and motivation and empathy and there's so much in the brewing right now that we have to do what we can to get it out. So I, you know, I think we talked right when the pandemic hit and I said, how's business? And you're like, man, it's hard to, it's hard to really compare what this the the opportunity amidst so much pain. Uh and and so thank you for coming. There's a there's a bitter sweetness to it, right? And I think one thing that, that everyone listening and watching can take away is that we've had a tidal wave happened. This tidal wave was Covid, you know, Covid 19 and it happened and it was big and it was impactful and and and and it ruined a lot of people a lot of lives. But what you saw is you saw two different types of reactions. You saw one reaction which was grab your towel and run to the shore and wait for the tidal wave to go back to see. But you also saw these incredible stories of resiliency and adaptability where people just grab their surfboard and I think that you know, hopefully there are no major covid type pandemics that happen again in the next while. But as an entrepreneur, as a business owner, as a creator, as, as a has anyone, as someone that cares about having creating value in the world, you're going to see tons of these tidal waves continuously come at you and you have that choice. You can wait for the wave to go away and you can wait for the status quo to return or you can grab that surfboard and you talked about restaurants at the beginning of this chat, some of these restaurants, they stopped being restaurants, they realize their job is not to create, you know, dining experiences inside their job was to feed their consumer with delicious food. Or it was to create a hospitality or is to create a feeling of warmth and connection. And when you, when you play with what is the value of creating, given this new title wave, some people are not uh not only able to survive it, but as you said, they're able to thrive. No better way to end a conversation than that. That's an exclamation point. What's the best way for people to where some coordinates that you would steer us listening and watching right now? Of course, you're, I think you're Harley f, Harley f on twitter, at Harley on instagram. And of course shop dot com is where you can find a lot of stuff. Um and if you want to watch Chase and I banter about all types of stuff uh you know hijacking one of our conversations on twitter is always a really great way to do that. Yeah, we welcome your engagement and Harley man, thanks so much, congratulations on the success you've created for yourself and those in in the shop of my family, but also the More than 1.7 million businesses out there that you are empowering. So I want to say thank you personally and until next time everybody out there in the world um good luck keeping your universe driving and thriving and we're here for you if you need anything, reach out on social. Until next time I bid you all do. Mm mm mm. Yeah. Yeah. Mhm. Mhm. Yeah.