? PAUL: (HTTPS://TWITTER.COM/PAUL_TIRBAN)

It’s Paul.

 

? FLORIN: (HTTPS://TWITTER.COM/FLORIN_MURESAN)

It’s Florin. What are we grinding today? I know. Let’s grind the seasonality of business.

 

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And since it’s the period in which everybody’s back to work, back to school, back from holidays, back to a co working space.

 

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Back to a co working space, back to running around after investors, trying to stress them all day long. Hey, man, can you invest in my business? In my business.

 

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Back to seeing money pouring in from the clients because finally they have money to spend. Or do they have money to spend after their holidays?

 

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I think they don’t. How are their budgets actually after the holidays? I guess all this money goes spent on Lamborghinis and martinis and stuff like that.

 

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I really hope to be a good month, but probably we can talk in, or if we remember in a future episode about how good this month was or not, and we could say that we are back to Startup Express because also we took…

 

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Yeah, we’re finally back. We’re doing this right now.

 

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Yeah. So seasonality of business.

 

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What does that even mean? I mean, such a fancy word.

 

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Well, if you’re in the fashion industry, it’s easy. In the winter, you sell winter clothes. In the summer, you sell.

 

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Summer stuff like, I know, sleepers.

 

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Yeah, I want to say bikini, but…

 

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You can sell that all the time.

 

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So how this relate to startups?

 

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Well, it can relate in lots of ways. I mean, if your startup is based on, I know, let’s say the wedding season, then summer is awesome for you. But if you’re a software service business like my business, then somewhere is horrible because basically everybody is on vacations or getting married or attending weddings and nobody cares about their business and they don’t want to invest in software. So there you have it.

 

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So can we frame it to say that in this episode, we will talk about seasonality as period of times in which sales spike or go down based on some events or some time intervals from the year?

 

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Yeah. And as we’re grinding that, we can also get into the fact that you can actually think about each season and each month in order to come up with new ideas for how to sell more products and how to move more products on the market.

 

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Would you think to a specific example?

 

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Yeah. Usually in Q4 because you have October, which is Halloween, then you have Thanksgiving, then you have Black Friday, then you have Cyber Monday, and then you have Christmas and everything related to Christmas, you can basically create a lot of sales events with a lot of offers. Usually, it doesn’t even depend if you’re a tech startup or not because you can just create a lot of new ideas for new launches just based on Q4 and all the events around Q4.

 

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Even if for some startups, this means that they don’t… So for example, if my startup doesn’t have anything to do with… I don’t know, maybe Black Friday is not the best example, but let’s say I’m a small CRM startup company that offers CRM for medium companies and it’s Valentine’s Day. Do you think I could run a promotion of Valentine’s Day or I shouldn’t because I don’t have anything to do with it?

 

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Definitely. You could totally run even different types of promotions.

 

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How would you see, for example, in this situation, a good promotion?

 

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Let’s try boring promotion first.

 

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A boring one?

 

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Yeah, a really boring promotion.

 

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Do you have an example.

 

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In mind? Yeah, something that anybody could do. Hey, you know what? 50 % off. You see that in your inbox as you open Gmail and you have 50 % off our Valentine’s offer. And then you open it and you see that the CRM has like 20 % or maybe 50 % if you buy the yearly plan. And that’s like the boring offer that you can do.

 

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Wait, so you made me to open the email by promising me 50 % off?

 

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Yeah. Because it was related to Valentine’s Day and you’re currently thinking about Valentine’s Day, or you’re getting other content about Valentine’s Day from other providers, so then you’re more likely to also open my email if I also talk about Valentine’s Day.

 

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Okay. And why is this a boring promotion?

 

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Well, because you didn’t really get creative about it. You just offered some discount without making a deeper connection between your product, your audience, and the event like Valentine’s Day. But you could basically turn this around. You could even have the subject of the email saying something bold like, We don’t like a lot of people, but we do love you. Here’s our Valentine’s promotion.

 

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I think in the first example, I would spend money on chocolate and wine and not on that CRM. But in the second one, I think I might give it a thought to your promotion.

 

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I know, right? Or if you don’t want to make this about your company, you could do it something like, Here’s a fun love story between your customers and your company. And in this case, I don’t talk about myself, I talk about my customers and their customers. And they’ll be even more interested in hearing what I have to say about the promotion because maybe I give some very creative content on how they can use the CRM to make their customers fall in love with them.

 

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Basically, it’s very important to be creative and stand out because everybody is doing promotion in that period. I guess that if you run promotions in that time frame, you need to be more creative than just running a promotion in the middle of the month without any relevance.

 

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I agree. I totally agree. And especially as you’ve said, a lot of people will be doing promotions during that period. So you have to be creative about it because even if I’m not going to get an email from another CRM company, I will get emails from other people doing Valentine’s Day stuff. So basically then I don’t compete with other CRMs. I compete with other people who have Valentine’s Day offers, which can be anything from Apple to a dating site to everything that could make a Valentine’s promotion.

 

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To the restaurant from your neighborhood.

 

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Definitely. And we do have restaurants. I do get offers from restaurants on Valentine’s Day for couples or for married couples, and they target their audience according to different specifics, but they also make it about Valentine’s Day.

 

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It’s not something that you definitely need by Valentine’s Day because, for example, if I need to take an Uber on the Valentine’s Day, I’m happy that they offer, I don’t know, 10 % off because either way I would have taken that Uber.

 

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Yeah, I agree. I agree. T hey can build more loyalty with such an offer.

 

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That’s interesting. I’m thinking a little bit now on the other side. Okay, you have this promotion on Valentine’s. Let’s say you have a spike in sale, you have a promotion of Black Friday, you have a spike in sale. But can it be seasonality in which you have a down period of sales?

 

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Yeah. Like you have in the summer, as I’ve said, if you’re selling to a very business to business audience and you’re trying to make sales and sales events during the summer, well, they’ll be gone on business trips or they’ll be gone on vacations. They won’t be at the office. And even those who are at the office, they’re already planning a lot of other stuff or they’re busy because it’s just them at the office and other coworkers. So basically they have a lot bigger volume of work that they need to get done in that period. So they will completely ignore your offers. But this is for the case when you sell to a B2B audience. However, if you are like the steam marketplace that sells PC games, well, they have their huge promotions during the summer because students, pupils, young adults, and I know people who are super young, they’ll be on vacation from school, from the university, they’ll be on vacation from their jobs, and they will have a lot of time to play games. And that’s when people, and you can see this on their forums, that’s when they go wild and they buy a lot of games, even 20 games.

 

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They only get to play one of those games, but they buy during the summer promotion because the promotion is huge and it’s perfect timing.

 

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So it’s very important for you to know what are your seasons in your business, say like that. Buy the classical one at Valentine’s Day, Black Friday.

 

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Yeah, definitely. Because even if I make a lot of sales this month, it doesn’t mean that you with your business could replicate the success. Maybe in your case, your audience is much more likely to buy during another season.

 

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Talking about seasons, I think if we refer only to sales, it’s not the most 100 % accurate to say like that because I think we need to look at it also from a cost perspective because definitely if I don’t get so much revenue, I need to budget some money for that period. For example, for the summer in which I’m not selling, it might be wise.

 

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Yeah, interesting. So instead of discussing about how you can make more money and get a spike in sales, you can actually use the idea of seasonality of business to prepare for periods when you will have less money.

 

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Yeah, because as we know, everyone, cash flow is important. So you can also look at this from a cash flow perspective.

 

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Yeah, this is a very valid point.

 

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And I think also, if we go a little bit even back to say like that on the tech startups, you might plan some other activities. For example, if you’re not doing sales because your customers are on holiday, I’m trying to think what you could do. An example would be, for example, doing some actual development?

 

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Yeah, that would be a good idea.

 

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Because you can focus on building new features, trying them out, maybe. I don’t know. Would you try or launch it during the summer for validating, so for testing it? Or when everybody’s…

 

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I would only release it for testing it because I’d get fewer users. And if something goes amiss, then they can tell me and we’re going to fix it. And very few people are going to see that we’ve made a mistake because everybody else was on vacation.

 

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So good plan would sound like a soft launch during the summer when everyone is in vacation to see if there are bugs, there are issues with the with the feature and then doing…

 

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And you don’t announce it to anybody. So only if people find it, then it’s good for them. They can fill in the bug request and everything, but you don’t launch it. You don’t plan it. You don’t talk about it to anybody.

 

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And when they’re back from holiday, you just announce them that, Hey, we have a cool new feature that you can try it out.

 

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Or you do a product launch around that feature if it’s a more impressive feature. Then you can actually spend a lot of time, especially in quarter four, to talk about new features and to make launch events for all the changes that you’ve made during the summer, which is a really great thing actually, because you can do a lot of development during the summer. You can test it without any stress. And then once people get back to work, you can really start promoting it and working on the promotion side of things. And then you use the way that time passes to your advantage.

 

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And repeat the cycle because…

 

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Yeah, and repeat the cycle next year. And I guess this makes planning a lot easier than anything else you could do.

 

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Nice. So basically we talk about sales and seasonality, cost and cash flow and seasonality, but also we’re looking now it influence the planning and feature development.

 

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Yeah, and the product lifecycle.

 

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That’s really interesting. Also, I’m thinking a little bit now, so if, for example, you look at your analytics, would it be wise how to call it? So to also take in consideration this part? Because otherwise, I might look that I didn’t have any people on the website this month or it dropped.

 

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Definitely. Yeah, it also affects that, especially in terms of terms of usage, how many people have actually engaged with the platform. You could find out that during summer, maybe nobody engages with the platform or very few people do. One other thing that you could see, and I noticed from the time when we had a website builder platform, it was very interesting for us because we got a lot of engagement during the winter holiday. And that was pretty weird because everybody tells you like, come on, man, you’re going to launch website builder on Christmas. How’s that going to work? Everybody’s with their families, everybody’s doing yada yada yada, and then you have the New Year and yada yada yada, and nobody will want to create blogs and websites and spend their time and stuff like that. Well, as it turns out, it was the only period when they thought they had actual time to try out the website builder tool and see if they like it. Because they were on vacation, they had nothing better to do and they were curious about it. So they said, Okay, now I finally have a lot of time, let’s do this.

 

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And we had a lot of usage during the winter season and we didn’t prepare for this. And we had a lot of support request and we were like, Really? And that lesson was learned after a while.

 

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So I think since you didn’t have people to do support, you don’t have a side builder actually now, right?

 

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Yeah, it wasn’t related to that. But during the next years, we actually planned for this and we knew that, okay, we’re going to take our own vacation before the winter holidays. And then during the winter holidays, we would actually be on support. We would work on, I know, fixing issues, seeing how their sites load and doing a lot of optimizations during the winter season, which is weird because nobody does that. But we had to because that’s what the customers wanted.

 

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Nice. Also, it came to my mind now that I saw actually one or two promotions of some businesses that somehow tried to steal the stars. So to be the first. Basically, instead of Black Friday, they made a Black Friday promotion one week earlier. What do you think about this and what’s your thought about this? Because you assume that people have the money, so you want to be the first who make them to spend them. Even if it’s like I make a Black Friday win one week before the actual Black Friday.

 

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This is crazy. Okay, so, dear audience, Paul has basically just created the most important topic of discussion for today’s episode, because what you’re saying is perfectly, perfectly true. And if you plan a Halloween campaign, and this is what a lot of interns and new people who have started with our company have asked me, if we have to do a Halloween campaign, when will we do it? Because Halloween is on the 31st of October, right? Yeah. So when do we do the.

 

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Campaign? well, one week before… Prepare it or launch it?

 

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No, launch it. We don’t talk about.

 

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Preparation, just launch it. During the Halloween, right? Because it’s the Halloween campaign.

 

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Yeah, that’s wrong because people will be out celebrating Halloween and they will not pay attention to the Halloween promotion. So basically what the textbooks, so to call them, would say would be do your promotion for Halloween one week before. But because that’s what people generally think about doing, everybody’s doing their promotion one week before. So you’ll have a lot of competition. And now very smart marketers, they actually start the promotion two weeks before so that they’re ahead of everybody else with the promotion. Because otherwise it’s exactly as you’ve said it. If I start my promotion one week before, but I have three other people who sell products on Halloween and they started two weeks before, my customers bought from the other three retailers and they don’t have any cash left to buy my offer.

 

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When it comes out. So if I’m doing it even after Halloween, they don’t have any more money because they spent it also on the Halloween day. Exactly. Interesting. I actually thought it was weird a little bit seeing it with so much time before, but from what you’re saying, it makes sense.

 

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Yeah, man, it’s so weird. I’ve actually learned this lesson from a couple of internet marketers who are selling informational products on the web. And they were telling me like, no, if you want to do the promotion, you have to run it before everybody else because otherwise people won’t have any more money on their credit cards. And this can lead to something that’s even crazier. And this does not happen for every single industry. But you could test it out just to see if it makes sense for your own business. And the thing to test, and I also know this from these internet marketers, is if you want to have a promotion or you want to drive conversions or message your customers, because in the Lin business canvas, the business canvas that you have for your startup, you know that you have the relationship channels. So you have the relationship channels and email push notifications, messages to your Facebook group where you have your customers and you try to push an offer out or just make sure that people reach your pricing page during a certain period so that you drive conversions during one point in the month.

 

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So you basically have an event when you want to drive your conversions, when you want to get as many people as possible to start buying the product. Now, when will you do it? Will you do it at the beginning of the month, in the middle of the month, or at the end of the month? And you can test this out for yourself, but one of the best ideas is to do it in the middle of the month, because that’s when usually people get paid on.

 

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Their credit card. When they are receiving their salaries and.

 

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Their money. Exactly. That’s when they receive the salary. And because people get so many emails, so many push notifications, so many things with sales during any given month, they receive the salary. If you make them buy too late, they will already have spent the money on something else. And then you will have to wait another month until these people can actually buy a rougher. This is something to test out.

 

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Let us know on our Facebook group how this went. So if you do an experiment like this, because actually for me, this is the new for… I always thought that the best period would be at the beginning of the month, but actually it might be that they don’t have too many money left in their spending budget because…

 

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Exactly.

 

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Interesting. And this is something that I guess is different from country to country, but we’re on international market and it’s what we’ve seen on all of the countries where we sell our products. So it seems a bit important to know when people are actually receiving their paychecks.

 

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Also, since we’re talking about this part and budgets, sorry, I would like to ask you another question regarding seasonality. So for example, would you consider a season, a budget period of a big company? So if I’m selling to big companies that have yearly budgets, can I somehow relate this to seasonality?

 

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Yeah. And I only know this from other people who have told me that they do this. I haven’t actually sold using this to enterprises. The only sales to enterprises were occasional and those customers reached out to us so we didn’t have anything planned for outreach. But for people who have sold to enterprises and they did do outreach, they actually use this because they were trying to sell in the periods when they knew those companies were creating the budgets. And they had to be exactly during that time frame. So it’s about three months when they create the budgets and when they allocate the resources and stuff like that. And if you don’t go into that window, no matter how much the persons that you know in that company want to buy a product, they will refuse to buy it because they can’t get the buying of other people inside the business. And then you have to wait for a whole new year to make the sale.

 

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And I think another important period, it’s also at the end of the budgeted period, because if they still have budget left, they need to spend it on something. So I think you could give it a try also at the end of the last quarter, for example. Because if I’m, I don’t know, the marketing responsible at this company, I still have a few thousand bucks in the budget, I will lose them if I don’t spend them on something. And if you come to me and you’re selling your SEO.

 

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Tools.

 

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I will spend them because otherwise, I need to give them back.

 

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Yeah, I agree. And maybe you’ve always wanted to do something related to SEO and it wasn’t the time. So now that you have this, why not spend it?

 

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And I think you can link it, for example, with the Halloween since it’s almost in appropriate period of…

 

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Yeah. All right. So we’ve actually covered a lot of ideas around the seasonality of business.

 

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And sometimes of podcast because we also… If you look at it, it might be that we had the first season, then we took.

 

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A.

 

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Holiday in which actually we work a lot on our businesses, but now we are back.

 

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We’ve basically taken a break from doing the podcast because we knew that you guys were on vacation and that you weren’t listening to us. And what did we do? We did development.

 

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Now, since we’re back with the new seasons, you would like us to let us know what subjects would you like. Don’t forget about the Facebook group that we have on our startup Espresso Facebook page. We work on our newly website that will be soon.

 

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The best part is that if you’re typing startup Espresso on Google, you will find our Twitter account, you will find our website, which is startupespresso. Live, and you can find the website and from the website you can find everything else, including the sponsorship panel where you can sponsor new episodes because our coffee isn’t cheap. And because it’s their best presser, we do drink a lot of coffee to create this podcast.

 

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And also the hosting and hopefully more coffee.

 

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Yeah, more coffee. I guess it’s always more coffee.

 

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With us. I was thinking at a new grinder that we broke it last week, but definitely more coffee because we can solve it with the grinder part.

 

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Yeah, we broke that. That grinder was awesome. It helped us create our intro sound and that was a great piece of technology. It will be dearly missed.

 

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That’s in the history of the podcast. A lso, we are happy to let you know that now you can listen us on Spotify, on Apple, basically everything.

 

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Yeah, I was a teacher and I guess everything else.

 

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So don’t forget, buy us a coffee.

 

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Yeah, buy us a coffee and don’t forget, we’re not your consultants.

 

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We’re not your lawyers.

 

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And we’re not.