Could this AI Founder Replace Investment Bankers? | First Time Founders with Ed Elson

Scott, you started an e-commerce company in the dot-com era. What would be your advice to founders building in the hottest sector right now, specifically AI?

The market's frothy. If you have a good idea and it has anything to do with AI, you're going to be able to raise a ton of capital. When capital's cheap, take advantage of it. Raise a shit ton of capital, but don't make the mistake of believing that because you raised a lot of capital and that you're supposed to— your company is worth a lot, that it's actually worth that. Take a real disciplined approach to spending. Whenever I've raised a ton of capital cheaply, that company oftentimes struggled. Your ability to raise capital says something about your business, but it's not the full story. So if the market's right, access the market, raise as much as you can, overraise, but at the same time, call on a different side of your brain and throw nickels around like they're manhole covers. And, you know, spend money, but be really judicious because just because you can raise a lot of money doesn't mean your company deserves it.

What was your approach to spending when you were building Red Envelope?

I've always been very scrappy. We were very penny-wise and probably pound-foolish. And then we raised, I don't know, $20, $30, and then $60 million from Sequoia and Western Presidio and all these brand-name VCs. And we started spending money like drunk sailors. I don't think, you know, there's a cycle here. You're in something hot. Every VC is going to try and encourage you to go faster until you run out of money, at which point they'll come in and cram you down. So I would resist the temptation to spend aggressively It's really nice to have a lot of money in the bank. If you find a customer acquisition channel that is really paying off, then yeah, put the hammer down and hire people and make some investments. But I just can't tell you how many times I have seen people who, because they access a ton of capital, they think they should spend it, and they think that they're going to be able to get a good return on it. Because keep in mind, when you're raising a lot of capital, it means other entrepreneurs are raising a lot of capital, which means customer acquisition costs are going up. The price for employees is going up. So I think it's just better to err on the side of not spending enough as opposed to spending too much. A lot of people disagree with me. When capital's cheap, you know, make some mistakes, spill some capital, that's fine. I'm on the board of a couple of these companies right now. They're just spending too much money. And everyone's in consensual hallucination that because the category's hot, it means that, you know, we should spend aggressively. And I'm like, spend aggressively when there's metrics that justify it. So anyways, raise as much as you can. But spend as if you're probably not going to be able to raise again.

Welcome to First Time Founders. It's been 18 months since ChatGPT launched, and the market's still going crazy for AI. At the same time, though, workers are anxious. From lawyers to accountants to writers to artists, AI threatens to replace them. In fact, one-third of American professionals fear that AI companies will make their job obsolete. My next guest might have started one of those companies. After working 100-hour weeks in investment banking, he realized that much of the work he was doing could be done by AI. So 3 years ago, he built one. His AI model can analyze earnings, assess transcripts, create DEX. In essence, it's your own personal analyst. And even more remarkable, some of the biggest banks in the world are already using it. This is my conversation with Gabe Stengel, founder and CEO of Rogo. Welcome. How are you feeling?

Good. Thank you for having me.

This is your first podcast, right?

It's my first podcast ever.

And you recently had a Business Insider profile. Do you feel kind of famous now?

You know, it's getting to me. It's getting to me.

We'll see. We should be clear. I've been friends with you for about, I think, 6, maybe 7 years. And I've been looking for the right moment to do this. And I think now is the right time. I mean, you just announced a $7 million seed round. You've officially launched commercially. You're now serving some of the biggest hedge funds and some of the biggest banks in the world. And your company is now doing what I think a lot of bankers speculated and feared it might do, and that is it's doing their job. Just as an example, I use Rogo, and I'll ask it to compare the price-to-earnings multiples of the biggest social media companies, and it pulls it right up. You could ask it, what are CEOs saying about AI and their implementation of AI at XYZ company, it pulls it up and it will deliver the answers with footnotes from SEC filings, from investor presentations, transcripts, et cetera. So I just want to start with the question that I think most of Wall Street would want to ask you, which is, is AI going to replace bankers?

No, I think bankers would actually be happy if it could replace a lot of the PowerPoint and Excel work that they do. But the reality is we're We're a long way away from, from full automation. And we're a helpful tool. We make people smarter. We make gathering materials quicker. We make putting together PowerPoints and research memos a little bit more efficient. We're not replacing anyone.

Are you sure that a banker should believe you when you make that statement? I mean, tell me more about why you're not replacing anyone.

Yeah.

Because it feels— I guess I don't believe you.

We're not replacing people, right? I mean, even in recent history, 5 years ago before COVID I mean, you probably had investment banking analysts after staying up all night creating a pitch deck. They would go print it out, bind the books, deliver the books to their managing director and partners' apartments. That would take a few hours. No one's doing that anymore because everything's virtual. It's not like these bankers are working less, right? They're just filling up their time doing smarter, more interesting things. When I was a banker, I spent a lot of time doing very interesting, thoughtful work at Lazard, and that's why I loved it. And then there was occasionally work that was not so thoughtful and not so interesting, and we're helping get rid of that. I mean, There's a lot of examples throughout history of automation, you know, creating jobs, right? If you look at the ATM example that folks like Ezra Klein bring up often of when ATMs got invented, actually what happened was there were more bank tellers than ever over the coming 3 decades because banks became more efficient to operate commercial branches. And so they expanded. I mean, I think what you'll see in investment banking and in investing writ large is it's going to become more efficient to operate these businesses and they'll want to expand.

Give us an example. I mean, you were a banker and you said that there are some services that you were doing that were meaningless.

Here's a great example. You cover a certain subset of companies. When they release earnings, you just want to write a quick update for everyone on your team saying, you know, what did they hit? What did they miss? What are they saying about M&A? Are they interested in M&A? What are people in the space saying? What's the analyst reactions? That can take a few hours to write. That can get automated. And now what you can spend your time doing is being thoughtful about, okay, so what does this earnings mean for us? Should we engage? Should we present new client, new acquisition opportunities to them instead of spending a lot of time synthesizing publicly available information and putting it in a little email? Another example is just like benchmarking, right? Every growth equity VC investor needs to know, like, what does great net revenue retention look like at Snowflake, at Procore, at all sorts of businesses? What they're doing right now is having an analyst Benchmark that on a quarterly basis so that they can reference it in podcasts and reference it in IC memos and so on. That shouldn't be done by hand anymore either.

So what kind of work do you think bankers will be doing if they're not doing all the things that you just described? What kinds of opportunities would you say this opens up?

Look, I mean, it's why do people use M&A bankers? And just to set the stage a little bit, what is an M&A banker, right? Like an M&A banker is not making investments for anyone. They're advising CEOs on when they want to sell their company or buy another company. They're offering real thoughtful advice, and that's the work they'll continue to do. And when you're offering really thoughtful advice, you have to have evidence to back it up, materials to back it up. Rogo helps make gathering that evidence a lot easier, prosecute more deals, advise more companies, offer smarter insights, and offer maybe more products, right? If you were just offering M&A advisory as a service before, maybe now that's easier for you to do with your team of 100. And you can also offer some consultation-style work that McKinsey does too, or some geopolitical advisory work as well. And the opportunity to Do you think that that's going to be the case across all industries?

I mean, one thing that I was just reading about before this interview, one of the most popular books of the late '90s was this book called The End of Work. And it basically just predicted that robots would leave us with nothing productive to do. And this has happened sort of throughout history. I mean, there's this other stat in 2014, Half of tech workers said new technologies would be net job destroyers. I remember back in 2020 when I was listening to Andrew Yang on this podcast, he was saying that every job is going to be destroyed by robots. In reality, there are currently more jobs than ever. Unemployment's at a record low. It sounds like you think that this is going to continue in banking, but what do you think about AI as it affects the entire world.

I mean, I, I, it's so interesting you bring that up. My brother, who you know as well, who's much smarter than both of us, brought this up to me this weekend. Much smarter, much smarter. Significantly smart, significantly smarter than mostly you, mainly talking about you. Um, he brought up the point that 100 years ago, economists said, hey, if we experience the type of economic growth we're expecting, the work week is going to go from 40 hours to 15 hours. You're not going to need all that incremental productivity. And what have we seen? The average workweek in the US has gone from like 44 hours to 41. You know, it's declined a little bit, but people are still working. They're still doing a lot. They're still coming to work every day, even if it's virtually now. I can't really imagine a world in which AI changes that so much. That seems like a cultural phenomenon rather than like a productivity phenomenon. And then the other thing that's really interesting about like AI automating away jobs is it's not just this thing where, hey, if they're capable of doing it, they'll do it. There's a lot of work that, you know, doctors do that nurses are capable of doing, but doctors have to do it legally. Doctors are the ones responsible for doing it. We will legislate what has to be done by humans and what doesn't. Right now, autonomous driving could probably take all cab drivers' jobs today. We're stopping it. And that's because we want it to reach, you know, a degree of safety and accuracy that we're more comfortable with than we are with humans. And so what you're going to see is Before these jobs get automated, they're going to be done a million times better than AI, than by humans. And by that point, we're going to want them to do it, and there'll be more jobs created, but it's not going to be like that.

So let's talk about the product itself. It's basically a chatbot that answers any questions that you have about finance. It's very similar to ChatGPT in that way. It's basically ChatGPT, but for finance. I think that goes for basically every AI startup that I'm looking at right now. Every AI startup is ChatGPT for XYZ, why not just use ChatGPT?

I think there's 2 parts of that question. One is, what is the interface for the work you want to do? Is it chat or is it something else? And the other is like the domain specificity of what we do. I'm going to start with the latter. ChatGPT in a lot of ways is a pretty smart 15-year-old kid who has generic accomplishments and can do basic math, can do basic reading, has reading comprehension skills, and so on. Would you rather have a generic 15-year-old or a 15-year-old who has maybe studied finance for the last 4 years and then also comes to work every day with a big textbook of all SEC filings, all earnings calls, and then reads Bloomberg on a daily basis, right? What is the context they have and what do they know how to do? Rogo is like ChatGPT in a lot of ways, and it's dissimilar in many more ways. We have so much data that ChatGPT doesn't have, and not only do we train on that data, but—

How do you have data that ChatGPT doesn't have? Sorry.

We pay for it and we integrate it, right? We have a You've used the product. It's a different product than ChatGPT. In some ways it's clunkier. We cite everything we allude to. We have millions and millions of documents that you can pick from when you query. And for a normal consumer who might just be looking up how long to bake chocolate chip cookies for, it's probably a worse experience. For an investment banking analyst, for a hedge fund PM, for, you know, the CEO of a private equity firm, it has everything they want and all the data they want. And we go out and we form data partnerships and we purchase data from other folks, whether that's market data, whether it's SEC filings directly from the federal government through EDGAR, whether it's earnings transcripts through providers. You know, there are all sorts of providers— FactSet, SP Global, Refinitiv. We have all this data that we integrate. And then on top of that, we integrate a firm's data themselves. And so we can have all your IC memos, all your historical pitch decks, all your historical Excel models too within Rogo. And you can ask questions about that and not just individual questions like, hey, summarize, you know, why we think that Chewy is going to grow 20% next year. You can say, look over all the models we've had for Chewy over the last 10 years and tell me what assumptions we got right and which ones we got wrong. That's not something ChatGPT is even close to being able to do. And it's because we focus on ingesting financial data and citing it in all of our answers.

Are you concerned at all that AI is becoming too powerful? I'm sure you get this question all the time, but this is the ultimate AI doomer Question. What are your thoughts about AI doomerism versus accelerationism?

Yeah, I was actually getting, I was getting dinner with my dad a while ago, maybe a year and a half ago, and I fully panicked. I was like, Dad, AI is coming. You don't understand because you don't understand how technology works, but it's coming and it's scary. And I'm not sure why I'm scared, but I'm just, I'm just viscerally scared. It feels like a disrupting thing.

Because of the work that you were doing or because of the conversations people were having?

Just all of the above, right? Like, I mean, it's something that lives in the collective of consciousness of folks in, in our world is this idea of AI, right? People have read science fiction, they've gone to the movies, they've seen Terminator. It's a scary thing to think about. I am not that scared anymore, and I'm not that scared for a number of reasons. One is artificial general intelligence just feels farther off to me than I think it felt a year ago.

Yeah.

And even if it wasn't that far off, I've, you know, adjusted the way I think about what AGI is actually going to provide. And I'm excited for it, but I mean, that's above my pay grade.

I want to talk about your career. So you were working in investment banking for about 2 years, and then you decided to start a company. Why?

Yeah, I always wanted to start a company. I think that's a result of overconfidence and not wanting to work for other people. But I mean, even Back when I was, I think, a sophomore in college, you know, a buddy of mine and me tried to create a pitch deck preparation tool for investment bankers back then. And we actually went into the Credit Suisse offices and met with like a, you know, someone who led North American investment banking. And obviously we were kind of laughed out of there. We couldn't do anything. But it's been on—

Who are you?

They're like, who literally, who let you in here? They're like, don't worry about it. Um, but I've been thinking about it for a while, and I mean, I, I loved my time at Lazard, and I learned so much, and I had amazing mentors, and I thought that LLMs and generative AI was going to change everything, and I wanted to be able to work on it in the way that I thought was going to be most productive and interesting. And I love to build things. Like, I am interested in creating products every day and thinking about the buttons to put in and the interactions and what it should look like. And that's what I'm passionate about.

I remember when you started this company, you barely used the word AI. I mean, it was— I remember you told me it was a— it was a— what did you call it?

A natural language interface for financial data.

Which just doesn't—

I mean, we were so scared of using AI as like a buzzword. And mind you, when we started Rogo, it was pre-ChatGPT. And actually, we prototyped Rogo using very anachronistic NLP, natural language processing techniques called like context-free grammars. But when we were starting Rogo, we didn't want to feel like we were just, you know, tying into some buzzwordy trend and we were, you know, hopping on the back of this big shift. I mean, we wanted to seem legit. I think that was a mistake. You should use these terms. They're powerful terms. And like, we are an AI tool. Why were we doing all this? you know, verbal gymnastics to not say AI because we were like kind of self-conscious and like thought we were like holier than thou. That was dumb.

But it worked. I mean, you raised $2 million in your pre-seed round, and now here you are. You're at $1 million in revenue. I mean, what do you think your investors liked about you? I'm sure it made you appear a bit specialized. I think so.

Ed, the deck, the deck is worth its whole nother episode of this just to look at how bad that deck is. It is one of the worst fundraising decks of all time. Uh, Kevin Ryan led our pre-seed. Kevin Ryan is an enormously successful entrepreneur. He's a titan of New York City VC and entrepreneurship. Started MongoDB, Gilt, Business Insider, Zola, and so on. I think Kevin just thought, these guys know finance, these guys know technology. I'm going to bet on them. I'm going to bet that they can build a tool that actually disrupts financial services. And I think that's what it was.

And what do you think you did right that made him believe that you were the guys to do it? Because I'm sure there are Thousands of startup guys around the country saying, I'm going to build the AI for finance, AI for whatever it is. You kind of hit the jackpot. You're now the AI for finance guy. What do you think he actually saw in you?

I mean, at Lazard, I had a really interesting role. I was working on both M&A work, financial services work, but also on their data groups team, this team called LDAG, Lazard Data Analytics Group, led by David Wang, who's super smart. And so I got to see what it was like to work at the intersection of technology and financial services. a firm with very cutting-edge technology and data science and AI capabilities.

Yeah.

And I think that was an incredibly unique background. And that was only possible because, you know, I'd been, I'd been, I'd come there after having worked in software engineering and quantitative trading and writing my thesis at Princeton on AI for econometrics analysis and financial statistics. I think that the story made sense to Kevin. And when you're a guy like Kevin, you're looking for a story that makes sense, right? You want to believe that Gabe Stengel is going to change financial services, that he's going to be the next Bloomberg. You want to, you want to fit the pieces to that narrative. And I think the pieces were there and I was just tremendously lucky. I mean, John, my co-founder, and I were just, and Tomasz, were just incredibly lucky to have all been in the right place at the right time, interested in the right things. And, you know, having said the right words and meeting the right people.

How have you convinced yourself of that story? Because the story that you describe is a pretty big one. And the expectations are high. And you mentioned this sense of overconfidence. Did you need to convince yourself that that story was true? Do you believe that that story is true?

Early on, frankly, when we raised money, when we raised that first $2 million, I thought to myself, you know, this, this might not be the thing that makes me enormously successful, but it's going to set me up well, right? Like, I'm going to do this thing. I'm going to do it as well as I can. And then I'm going to have a lot of opportunities afterwards. That really shifted over the past year, shifted to the idea that, no, no, this is going to be my big thing. This is going to be my life's work. This is the best opportunity I have to create a massive company that's valuable not just to the people that invest in us and myself, but to the people and the clients we serve. And it's going to be enormously valuable to our customers. And I think that thinking has changed in part because of what we've been building and what we've been able to accomplish. And, you know, the trends in generative AI writ large. And I think it's a— it's not that often you find yourself at the center of this changing dynamic system in tech where there's a new technology that's enabling so much rapid growth and you're situated selling to a clientele that has the most appetite for increases in efficiency and increases in intelligence. Than anyone on Earth. And I think we have a tremendous opportunity. And that did change. And frankly, it wasn't that I had to, like, sit down and convince myself, hey, Gabe, you're going to be able to do this. It was like, as more pieces of evidence accumulated, my thinking changed. And I wish I could be really thoughtful about, like, how I thought about it at the time and how I thought about it now. But I think, frankly, like, as things ebb and flow and you're more successful and less successful, you make products that work better or you work— that work worse. the thesis develops.

Would you say that you're sort of throughout your entrepreneurial career so far, you've been shooting from the hip in a way? That's kind of the way it sounds, is you go out and you just try as many things as possible. I mean, it sounds like you haven't actually overthought— I mean, the journey too much.

Look, part of the reason that original pre-seed deck is so bad is because it's very overthought. One page has a million graphs and charts and a million things on it. And it's not that we weren't thoughtful, it's that all that thoughtfulness was, was wrong or, you know, it was on the wrong thesis or using the wrong assumptions. We try to be enormously thoughtful and then we try to change our minds very often. I mean, you have to try a lot of things and see what sticks and run with it and know how to capitalize on opportunity. I mean, we've tried all sorts of things, right? We've iterated on all sorts of technologies, whether it's querying structured data, unstructured data, internal data, you know, presenting it in one way or the other. The way that we actually synthesize insights from a product and tech perspective, you have to be incredibly nimble and dynamic. And then from a selling perspective, it's the same thing too. I mean, figuring out what your message is when you go to market and sell to a hedge fund, that's just as much IP as the technology.

Right.

Figuring out what words resonate and what convinces someone to open their checkbook, that's IP too. And the only way to figure it out is to be really dynamic and, you know, oh, that hedge fund didn't like this language, but this use case resonated, let's tweak. Oh, you know, this use case didn't resonate this time. Why is that? Let's tweak it. And so on. And so it's not firing from the hip, but it's just being very nimble.

We'll be right back. We're back with First Time Founders. Has there ever been a time where It didn't work out. The pitch didn't work. The product, you got a bad review on the product and you thought, what am I doing?

Has there ever been a time? I mean, it only happens 50 times a day where some, why didn't this work? You know what, 5 times a day we get an email being like, the login didn't even work. You know, there's so much that's in flux. And then there's early on when John and I were going out and pitching hedge funds pre the ChatGPT craze. I mean, AI sounded like snake oil. It didn't sound like the future. We got laughed out of rooms. We would work so hard to get a single meeting with a fund, and then they would just be like, why the fuck would we want this and not Bloomberg? What are you talking about? And we'd be like, well, you know, it's the future. It's going to change everything. They'd be like, let's see the product. We'd be like, don't worry about it. Like, it's coming when you pay. Like, of course we got laughed out of rooms. I mean, I remember not even that long ago, a little less than a year ago, I, we were so pessimistic about what we were building, not because we didn't believe in the technology and not because we didn't believe in, you know, writ large, the trend of what we were doing or our team. It was just like it was a low moment. And I think you have a lot of lows and a lot of highs when you're building a company. And, you know, when you say entrepreneurial journey, I cringe a little bit, right? Like, because I'm starting— I'm just starting, right? I am. I am like a baby compared to guys who have really done it, guys and gals who have really done it. I mean, We are so early innings, and yet it has been hard and interesting and ups and downs and so on.

One founder said on this podcast that the biggest obstacle in building a company is the desire to quit, and that actually your job as a founder is to just figure out as many ways as possible to minimize the probability that you're going to just give up and quit. I'm wondering if you agree, and if so, What kinds of, what kinds of steps, what kinds of action have you taken to make sure that actually you don't quit?

Yeah. So there's actually, I think Jack Altman had a great tweet about this, which was at the, in the pre-seed world before product market fit, the limited finite resource is not money. It's a founder's willpower because especially those early days before there's people saying, we love your product, we love what you're building. Like, You were just taking a beating every day, going out there, painting this vision and being told, you're an idiot. Stop. I don't care. I don't care. I don't care. And it's really that finite willpower. And I think, you know, the best way to mitigate that is to achieve product-market fit and iterate as fast as possible until you can figure something out. I think if you go 5 years without creating a product that people like, quitting is inevitable. It's really, really hard to just keep marching uphill. It's just sufficient. I think in terms of like, At this point, now that things are going well, how do I make sure I keep my foot on the gas? I'm just trying to figure it out. I mean, there was a— some of the Benchmark guys did a podcast with Patrick O'Shaughnessy, Peter Fenton, and Victor, their new partner. And they were talking about how there's 3 drivers for what founders do. One's generative, right? You want to create a new product. The second is competitive. You want to beat others. You want to be the richest. You want to be the best product, so on. And the third is like The pleasure instinct, right? Like you just want to accumulate material goods and then like enjoy them. And they seem to think that the biggest risk was losing touch with the generative and focusing too much on the, on the pleasurable. And, and Victor on the podcast who started a really successful game company was talking about how early on in his, and he's a billion times more successful than I am and you, just, just so much more successful. He was talking about how the first few years he, he only spent 1% of what he made. And that was to mitigate him, you know, getting brought into the dark side and losing focus. And I think as a founder, you have to figure out what are the ways you keep yourself focused and you keep yourself sharp and you keep yourself excited about what you're doing.

And what are some of those? Do you have any specific strategies that you take to do that?

I pace a lot and listen to like EDM music to get excited. I mean, you just have to, you have to stay really excited about what you're doing. And that's easy when things are going well. And when things aren't going well, you know, it's good to have a support system around you and family and friends who care about you and folks you can hang out with and unplug and realize, you know, no one else really gives a shit the way you do, right?

Right.

I can think I have the worst meeting, worst day ever. The reality is no one else on earth cares as much as I do, right? And that's a good thing. That's a benefit for me. That means I can go harder than anyone else possibly could on making this thing a reality. But it also means that I feel the pain more than anyone else too. And it's, it's good to be reminded that you know, no one else feels the pain the way you do.

What is your approach to management at this point? I mean, you're a very young guy and you've got 16 employees, soon to be, I think 50 is your goal by the end of the year.

18 now. We had 2 people start today.

There we go. Yeah, what's been your approach to management? How do you motivate your team and how do you, I mean, lead?

I'm trying to become a good manager. I think it's very hard. You know, everything I'm doing, I'm trying to get better at. Right now it feels like I'm an F on everything— technical leadership, you know, managerial leadership, sales, and so on. And I'm just trying to get to, you know, C+ range. And being a manager is a big part of that goal for me. I think right now I have really, really smart, autonomous folks that I trust. And so I don't have to do that much management. I trust everyone on my team to know how to prioritize and know how to get things done. And so it's eliminated a lot of my management burden.

It sounds like having extremely talented people is why it is what's making the job easy.

Oh, people is, is, people are everything. I mean, I couldn't, you know, would I rather lose our 5 biggest customers or our 5 best people? 5 biggest customers, hands down right now, because the people are who building the product, building all the processes that will allow us to scale. Everything else, you know, ebbs and flows in the near term. The people are who actually are like transmitting knowledge from one person to another. building our technology, iterating with high velocity. I mean, I think people are so much more important than I thought going in.

I want to talk about challenges and how you deal with them. And I'm wondering what if you can point to a specific time building this company that you identify as the biggest personal challenge that you faced.

There was a moment where nothing was working, and we've been working on this for a while, right? We've been pushing this vision of AI for finance. Before anyone in finance gave a shit about what we were doing. And we've been working on it. And there was a time when, before we were picking up traction, before people were seeing the value, before we even knew how to, how to speak eloquently about what we were building. And that's probably why people couldn't see the value. We had nothing. And it— I was fatalistic. I wanted to give up. I felt trapped. I felt like there was nothing I could do to salvage what we were doing. I was here, a steward of capital. I'd been given all this money. to not just take care of, but then to create something and return value. And I just saw no way to do anything. And I felt like I was in this box unable to get out. And obviously in retrospect, that was wrong. And actually the next day we pivoted slightly at what we were doing. We were looking at structured data before, and then we started looking at unstructured data, which really for, you know, the, the unanointed in GenAI means stock going from analyzing things like stock prices to analyzing things like 10-Ks. And it started working a lot better from a sales perspective. And the great part was we were actually able to leverage our preexisting work and technology to a huge degree that gave us a huge leg up. But I literally wanted to quit that day before. I was so ready to be done. I had a full panic attack. I called my co-founder. I was like, dude, what, like, what, what, what are we doing wrong? You know, I don't think we're dumb. I don't think we're working on things that aren't valuable. I actually think we're more sophisticated in the way we're building and thinking about this than so many people. Why is nothing going right?

How did you get out of it? What did you do? I mean, you specifically the structured versus unstructured data point, but what did you do mentally?

Mentally?

To continue?

I mean, I— one, I went home early and just like, I was like, I need to get out of here. And I pace and listen to EDM music. So I did that quickly. And then I went home and I just decided, you know, we're going to run 10 more experiments on sales, on technology, on figuring out what wording works. And we're going to give it, you know, 3 more months. And if it's still not working, you know, it's probably not a problem with the market. It's probably not a problem with the technology. It's probably a problem with me. And at that point, like, maybe it's time to wrap it up and I should just be an investment banker rather than trying to be a technologist.

Right.

And we started running more experiments with more rapidity and something worked.

I guess that's sort of the question is identifying What is that moment when I should actually pack up and leave?

I actually— yeah, I think that if you are a smart person working in an interesting space where there's a lot of commercial opportunity, the one thing you shouldn't do is stop trying, right? Like there's something that's going to work and you just need to keep trying until you figure it out. But it's hard. And that's the Jack Altman point about, you know, how much, how much grit do you have, how much tenacity to not quit. Before you get to that point in PMF where, oh, you know, it's obvious I'm onto something. Until then, you have no evidence. And all the evidence at that point points to the contrary. It points to that you're wrong and dumb and no one wants what you're building and you're— everything is incorrect. That's hard.

How much of building a successful company do you think is the grit aspect that we've been talking about versus—

I just need to clarify for, for everyone listening, I am nowhere close to yet having built a successful company. So like, this is all, you know, this is all fun and wishy-washy. Like, we are still so far from being a successful company. And that's for many, many reasons. We've created—

But as someone who aspires to, you're on your way.

Yeah. You know, what am I trying to— why, what do I think is important or what do I think will be important? I mean, I don't know. I'm trying to figure it out.

Do you view yourself as talented?

Genuinely? I mean, I think I'm like, you know, of normal to, you know, high intelligence. I can work on problems. I'm interested in things. I'm really curious, and I'm passionate about the technology and how it works and how it can work for people.

The reason I ask is because I think a lot of this is about The ability to walk into a room with important people. In your case, you're talking with CEOs of banks and believing that you have a right to be in the room. And I think with a belief in your own abilities and your own talents, I'm sure that's a lot easier. And I wonder, to what extent do you feel that you deserve to be in the room when you walk in there?

Yeah, I mean, look, I think there's, there's a lot of people who are smarter than me with better ideas, um, who could be more impressive in that room. And I've been lucky to be at this cross paths, this intersection of being born with an enormous amount of privilege and then being born as someone who can take advantage of those opportunities and, you know, prosecute them.

So what advice would you give to a founder who's trying to start those meetings, who are trying to—

Oh, reach out to people. So it's, I think one, one part of it is, you know, being born with privilege and connectivity. I mean, I also, I probably send 40 cold emails, DMs, Twitter DMs, things a day that get ghosted or people literally, you know, tell me to fuck off every day to all sorts of people. Um, and I've been doing that for years. And I think you just, you just have to reach out. I mean, If you send 100 emails to 100 different, you know, let's call it managing partners at a hedge fund, one is going to respond. Once that one responds, you can say to the other 99, hey, I just chatted with, you know, Joe Schmo at this hedge fund. He mentioned this. Is that interesting to you? And then it can avalanche and compound, right? But you need to reach out to people yourself. You need to create that connectivity. And I've done that as well. But that's— I mean, that's vital.

You have a co-founder, John Willett, who you started the company with, and he is the—

COO or president.

Okay. How has that relationship developed? Because I know that you were friends in college, you joint wrote a thesis together in college, and now you started this company. What have been some of the learnings from starting a company with a friend?

Yeah, so he was one of my best friends. He was simultaneously the funniest guy I knew and the smartest. And so when it came time to write a thesis, I was like, I'm gonna get Jon to write this with me because he's gonna do most of the work. He's way smarter than I am, and he's the funniest dude ever. Jon and I do not hang out socially for even an hour a month anymore.

Hmm.

I mean, we spend so much time together for work, and we work in the office 6 days a week, basically. You know, 9 to 9. I really don't want to see Jon when I'm leaving work and I'm getting dinner with friends. And I enormously love him and think he's one of the funniest guys ever. We just have a work relationship now.

Has that surprised you?

No, I don't think I had robust expectations going in. I think that— I think that it would be weirder if I finished a long work week and the first thing I wanted to do was, like, hang out with Jon. I think that would be more concerning in a lot of ways. And we have a great relationship. We're still best friends and incredibly close. And now it just has a whole new dimension that I've never had in any other relationship before. And so I'm learning to navigate what that looks like too.

How have you managed stress in your relationship with him? Because, you know, you're working with him all day, every day.

He's just— he's just so stoic and patient and great. And so I can afford to be less so, less great, more anxious, more, you know, irascible and given to anger and anxiety because he's there as a stabilizing force.

Right.

I think that if he were less sort of, you know, composed and rational and stoic, we would have a harder dynamic. But I think he knows, oh, you know, Gabe's getting upset that this PowerPoint page had a typo. I know he's just, you know, in a bad mood.

Yeah, one of the things that Scott talks about a lot is the value of stoicism. And his line that I really like is, nothing is ever as good or as bad as it seems. But it sounds like from your perspective, there might be some value to your anxiety. You know, checking that the deck has one typo and freaking out about it. Well, it's not stoic, but it is useful. results in the mistake being fixed. I'm wondering if you have any thoughts on perhaps if there's value in not being stoic as a founder.

Yeah, yeah. I mean, I am not a stoic guy. By no means am I a stoic guy. I am a high highs and a low lows guy. And I think that helps me be very passionate and diligent about what I'm doing. I am a perfectionist in a lot of ways. Low patience in a lot of ways. And at the end of the day, I am just so interested in making a product that's enormously valuable and just fantastic for the people we serve. And that means I need to be nitpicky and low lows and high highs, and I need to be so proud of when it works well and I need to be so embarrassed and disappointed when it doesn't so that I have the drive to then make it better. I think it's a superpower in one way, And then in the other way, it is, you know, it can grate on you. If you're constantly having low lows and high highs, it feels like you're on a roller coaster.

If you could give one piece of advice to yourself when you were starting the company, and this is kind of another way of saying, what do you regret most about when you started the company? But what's the number one piece of advice you would have given to yourself?

I think the number one piece of advice I would, I would make is, you know, don't neglect the things that you were enjoying outside of work just because it feels like work is overwhelming. And I was actually on the phone with Kevin Ryan recently, and he gave me really great advice. He said, Gabe, look, if there were 5 more of you at Rogo, you would all be busy all the time.

Mm-hmm.

So the reality is you're actually only ever gonna be able to do 20% of what you need to do. And so the, The way to handle that is not to, you know, be so regretful that you can't do more. There's not 5 more of you. You can't work around the clock. What you have to do is accept it and be like, okay, I'm only ever going to be able to do 20% of all the work I need to do, and I need to make time in my life for other things. Otherwise, I'm going to burn out.

Mm-hmm.

And I think that, you know, it's, it's nice to still see friends and to play basketball and to do all sorts of things that I think can be neglected when you're so heads down.

And have you made any conscious changes after he talked about that?

We should schedule a weekly tennis lesson. I would like to do that. That would be one good step. Yeah. Yeah. So good to see you.

Gabe Stengel is the founder and CEO of Rogo. Gabe, thanks for coming on.