Patrick McKenzie — Money laundering, big tech censorship, SBF & Japan
I talked with Patrick McKenzie (known online as patio11) about how a small team he ran over a Discord server got vaccines into Americans' arms: A story of broken incentives, outrageous incompetence, and how a few individuals with high agency saved 1000s of lives.
Enjoy!
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Sponsor
This episode is brought to you by Stripe, financial infrastructure for the internet. Millions of companies from Anthropic to Amazon use Stripe to accept payments, automate financial processes and grow their revenue.
Timestamps
(00:00:00) – Why hackers on Discord had to save thousands of lives
(00:17:26) – How politics crippled vaccine distribution
(00:38:19) – Fundraising for VaccinateCA
(00:51:09) – Why tech needs to understand how government works
(00:58:58) – What is crypto good for?
(01:13:07) – How the US government leverages big tech to violate rights
(01:24:36) – Can the US have nice things like Japan?
(01:26:41) – Financial plumbing & money laundering: a how-not-to guide
(01:37:42) – Maximizing your value: why some people negotiate better
(01:42:14) – Are young people too busy playing Factorio to found startups?
(01:57:30) – The need for a post-mortem
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Is Crypto a Scam? with Crypto Skeptic Patrick McKenzie
✨ DEBRIEF | Ryan & David unpacking the episode: https://www.bankless.com/debrief-patrick-mckenzie
------ Why do banks have holidays? Should we redesign the banking system? Is there a future for crypto?
Today we’re joined by Patrick McKenzie, an advisor at Stripe who writes about the modern financial system helps us answer these exact questions.
First, we talk about the inner workings of the existing banking system. Then we get into crypto, where Patrick shares his reasons for skepticism.
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------ TIMESTAMPS
0:00 Intro 6:35 Patrick’s Background 9:48 Banking System Evolution 20:09 Banking Holidays 26:44 Financial System Redesign 40:12 Transactional Freedom Trade-offs 1:03:39 Crypto Slogans 1:11:36 Crypto Predictions 1:21:42 Closing Thoughts
------ RESOURCES
Patrick McKenzie https://twitter.com/patio11
Check Out Patrick’s Blog https://www.bitsaboutmoney.com/
Molly White Episode https://www.youtube.com/watch?v=y9Itd3g23QI
------ Not financial or tax advice. This channel is strictly educational and is not investment advice or a solicitation to buy or sell any assets or to make any financial decisions. This video is not tax advice. Talk to your accountant. Do your own research.
Disclosure. From time-to-time I may add links in this newsletter to products I use. I may receive commission if you make a purchase through one of these links. Additionally, the Bankless writers hold crypto assets.
See our investment disclosures here: https://www.bankless.com/disclosures
What Happens Now to All the Laid Off Tech Workers?
The US labor market looks rock solid. The unemployment rate is at its lowest level in 50 years, while layoffs continue to trend downward. But there's one glaring exception and that's the tech industry. Nearly every major tech company has announced layoffs in the last few months, which is exactly the opposite of how things played out over the last decade, when the sector was a bright spot in an otherwise sluggish job market. So what's going on? Why now? Who is getting cut? And will these tech workers quickly find new jobs? Can they apply their skills to the burgeoning AI space? On this episode of the podcast, we bring back Patrick McKenzie, the author of the Bits About Money newsletter, who previously worked at Stripe for six years. He talks about the current trends in tech employment and why it's still a good idea to become an engineer.
See omnystudio.com/listener for privacy information.
Why Corporate America Still Runs on Ancient Software That Breaks
Southwest Airlines had a disastrous holiday season, thanks in part to a software bug that left crews out of place and grounded thousands of flights. But Southwest isn't alone in having software in the headlines lately. The New York Stock Exchange recently had a software error that caused weird pricing on stocks and the FAA had its own computer issue that grounded planes earlier this month. So what's the deal with corporate software? Why do these crashes happen? And why does the user experience typically leave something to be desired? On this episode of the podcast we speak with Patrick McKenzie, an expert on engineering and infrastructure, who writes the Bits About Money newsletter and recently left payments company Stripe after six years. We talked about the challenges of keeping any software system alive after years of upgrades and updates, the distribution of tech talent across industries, and whether non-tech companies can close the gap with Silicon Valley.
See omnystudio.com/listener for privacy information.
#013 – How to overcome the biggest challenges to your online business with patio11
Patrick McKenzie divulges his wisdom around how to develop promising business ideas, find your first customers, convince smart people to work with you, generate more revenue, and stay happy while doing it.
SaaS Pricing: From $30/Month to $75K Enterprise Deals
Patrick McKenzie built Bingo Card Creator into a $300K business, then spent four years stuck on the long slow SaaS ramp of death. His SaaS pricing started at $30/month for hair salons that barely cared about no-shows. The real customers were trades businesses losing $500-$3,000 per missed appointment.
Patrick reveals how he validated demand by walking into 15 Chicago businesses with an iPad prototype for under $400, why his initial SaaS pricing targeted the wrong customer segment, and how he landed a $75K enterprise contract while running Appointment Reminder solo from Tokyo. His SaaS pricing strategy evolved from a single $30/month plan to tiered pricing tiers that served both individual professionals and five-figure enterprise accounts.
After four years at $7K MRR, Patrick hired a commission-based sales rep and built the systems needed to scale. He also shares the worst outage in his career - when every customer received 96 automated calls at once - and why personally calling 60 affected customers turned a disaster into a trust-building moment. Patrick's SaaS pricing lessons prove that matching price to customer pain level matters more than any feature set.
🔑 Key Lessons
💰 SaaS pricing must match the customer's pain level: Patrick's $30/month plans attracted hair salons with no real pain, while trades businesses losing $500-$3,000 per missed appointment became the core revenue drivers.
🎯 Validate SaaS pricing assumptions with shoe-leather research: Patrick validated Appointment Reminder by walking into 15 businesses with an iPad prototype for under $400, learning more in one day than months of online research.
📉 The long slow SaaS ramp of death punishes lack of passion: Patrick spent four years stuck at $7K MRR because he chose a profitable market over a problem he cared about.
🤝 Hire a sales rep before you think you can afford one: Patrick's commission-based sales hire broke the pattern of growth happening only when he personally responded to inbound emails.
🛠️ SaaS pricing tiers unlock enterprise revenue from the same product: Appointment Reminder served $30/month solo professionals and $75K enterprise contracts simultaneously, expanding addressable market without rebuilding the product.
🧠 Listen when smart founders warn you about passion: Peldi from Balsamiq told Patrick not to build Appointment Reminder because he was not excited about it. Patrick ignored the advice and spent four years proving Peldi right.
🚀 Personal crisis response builds SaaS customer loyalty: When 96 automated calls hit every customer at once, Patrick's decision to personally phone 60 people turned a catastrophic failure into a trust-building moment.
Chapters
Introduction and Patrick McKenzie's background
Bingo Card Creator: $300K revenue and end of life
What Appointment Reminder does and who it serves
Finding the real customer: trades vs hair salons
Walking into 15 businesses in Chicago with an iPad
Four years of distraction and the passion problem
The worst day: 96 phone calls per customer
How his daughter changed his approach
Current revenue: $7K MRR plus enterprise contracts
Lightning round
Resources
Full show notes: https://saasclub.io/44
Join 5,000+ SaaS founders: https://saasclub.io/email
Stack Exchange Podcast - Episode #12 w/ Patrick McKenzie
Stack Exchange Podcast - Episode #12 w/ Patrick McKenzie by The Stack Overflow Podcast
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