Raw Wisdom for Modern Founders with serial founder Hiten Shah

There's no better hack to product market fit than someone else's product market fit. And I don't mean like you copy them, I mean you find the opportunities within their fit that they're not servicing.

Hi everyone. Welcome to the Founders in Arms podcast with me, Imad Akhan, founder and CEO of Mercury.

And I'm Raj Suri, co founder of Lima and Tribe. And today we have with us one of the most, I would say versatile and dynamic entrepreneurs in Silicon Valley. Not a household name yet, but he's someone who really inspires me. Hitan Shah, welcome to Founders Anonyms podcast. Ima, do you know Hiten? You guys have both been around for a while. Yeah, yeah, yeah, yeah.

I mean, I think, I think Hiten is famous. At least he's famous famous for me. He's been doing startups as long as me. When did you do your first startup, hidden?

2003.

Oh, even before me. So I did my first in 2006. Yeah, I feel like you've had a really long journey. Maybe tell the audience about kind of, you know, your, your various journeys, your ups and downs, like, and what you're up to nowadays.

Yeah, for sure.

For me it started when I was 5 years old, so it's actually 4 years old, not 5. I think it's 5. My dad thinks it's 4. But he's probably right. He's got a better memory than me. He told me I should be an entrepreneur. He told me that he's a physician, he's an anesthesiologist and he's like, I don't use my brain. And he told 4 year old me that. And so there's some things where I don't know any better. So one of them is I don't eat meat. I grew up in a religion that didn't eat meat. It's called Jainism. So I don't know any better when people ask me, how come you don't eat meat? Well, I don't know any better.

It's how I grew up. Right.

So. So when it comes to entrepreneurship or founding companies, that's all I've done until recently where I sold my company and now I work at a Dropbox public company, 3000ish people. And it's my first job ever. And so fast forwarding, I work with someone I've known for 15 years. If he wasn't my boss, I'm not really sure.

If they could handle me, let's say. But yeah, so I don't know how to do any of this. That I'm doing right now and it feels the same. My boss's name is Morgan Brown and he is just like many of us, he was around a long time ago, in the early 2000s, so to speak.

How long have you been at Dropbox now?

We sold the company last year in May and we announced it in October. It was a little bit of a quiet period for us as we integrated into the Dropbox infrastructure and business. We were able to do that between May and October and got our product running on their servers and shipped with a product that they were building. We are a sort of companion to that product.

So you're part of this kind of Dropbox Dash product?

Yeah. So there's an area called protect and control that is powered by the technology and the product that we brought over and our product is still live as well, independently.

So we've got Dropbox Dash, I guess for people who don't know, is a. Is a cool AI enabled kind of search across all of your business apps tool, right?

Yeah, yeah, it's like enterprise search plus AI just like, you know, there's a bunch of these things running around today. So we, we have built our version of, of that.

Is this your first exit or you sold your.

So I've sold, I've sold products before.

Yeah.

I haven't sold an entire company before.

Oh really?

Like what did it feel like when you went through it? Was it kind of anticlimactic? I sold my previous company and the whole process was actually like quite like, you know, it's like something you kind of dream of as an entrepreneur. You're like, I'm going to sell this thing, I'm going to. And then I was like, okay, actually this is like it was kind of more fun to run it. You're there now, so maybe you can't say that, but like what did it feel like going through that process and being on the other side of.

Yeah, yeah. I can say a lot about it. I would say that like you don't start a business with the intention of selling it unless you're a very special person that knows how to do that or is delusional. Right. So knows how to do that, meaning you've done it before, you know the game you're playing or you're delusional and you think startups are about selling them.

Right.

Startups are actually about finding the things that can turn into massive, massive businesses. Congrats to you. I think you're onto one of those. So you know, I had to give you that congrats because that's pretty awesome. Awesome. I think it was announced recently. What? Your Mercury is valued at $3 billion. So that's what you're supposed to do.

This was a rumor. Okay, sorry, Whatever it is, I get any comments on it. I should have probably said that at the start of the podcast. That's okay. I saw it.

I saw it.

There's a rumor, but there is a rumor.

The big point is just like I can talk about business, you know, you.

Can joke about it. I'll just be no comment. No comment.

Yeah. So my whole point is like, the whole point is to build a big. That creates a debt in the world somehow and changes things.

I will push back on that a little bit. Haytin, I don't know what your background is, but I came from a very poor background. And when I first started a startup, I mean, it wasn't just to get rich, but it was definitely a motivation. Was like, hey, I want to be successful. And making money is like part of being successful. And I don't feel like I really got that until I sold my previous company, but it was definitely way harder. And I did decide halfway through that actually doing it for just selling is a stupid reason to do things. But that was definitely my initial motivation.

And my whole point is, and I've run self funded businesses. I have long running self funded businesses. In fact, my business, Crazy Egg is run by my wife and it's been running longer than Dropbox. So Dropbox is 18 years old, we're around 20. So, so. And the reason I mentioned that is if your goal is make a lot of money for yourself, you should probably start a business where you don't raise money. If your goal is like make a true dent in the world or for whatever reason you think you need money to build your business, which is a whole nother discussion probably then like the second you raise money, and I've been known to say this, you're on a clock and it's not really your business in the same way it is if it's a self funded business.

Okay, I see your point.

And so, so, so your misconception going into it was a misconception is all I'm trying to say. Whether it was right or wrong, it was your misconception.

You know, there's a funny, funny story related to that. In 2007, Paul Bukai was, you know, I don't think he was part of Y Combinator at that point, but he was giving like a talk at Y Combinator. And I distinctly remember so I just started being an entrepreneur. I distinctly remember him saying like hey, if you want to get rich, like this is a bad idea, like you should go work at like Facebook or Google or you know, maybe go run business. But if you want to be a VC backed startup like that, your expected value here is not like good. And at that point I was like, are you crazy? But it's funny because I had a bunch of friends at that point that joined Facebook and Google and at that point these things were somewhat no brainers but they still made actually way more money than me even after I sold my startup, which took basically nine years.

If Facebook's stock price was like just not Too long ago, 150 bucks and now it's 600 and you got stock at 150, your stock, whatever you had, let's say a million bucks over four years, whatever it was is now 4x. Yeah, it's crazy like, like, like he's.

Not wrong like that that's how he was 100% correct.

If you hit the right company like that. I know, I know you are, I'm just saying that's like it's these things.

But I was 100% sure he was wrong at the time.

I know, I know. It's like, I mean part of it is like this is why these kind of conversations are important because all we need to do is incept one person who has the wrong concept of this and hopefully they will be that much more successful or that much more aligned with whatever they actually want.

Right?

Yeah.

So Hiten, what did your, I mean first of all, how many cash flow businesses do you have or have you run like these self funded businesses? Right. And what have they taught you about running, you know, these VC backed businesses? Because you know, I've seen both of them now and I think there's some interesting lessons that especially tech founders like engineers can learn from self founded, self funded businesses.

I think the heuristic or the way to think about this is that when you raise money you're, you're getting money ahead of your revenue. When you're self funded, your revenue is what helps you survive whatever way that works for you. And so that simple thing is the way I sort of filter, analyze, assess things like should I raise money or not or.

Should we keep self funding? I don't like calling a bootstrap because I don't know anyone with boots and straps and pulls them up and that's how you walk, like that's where it comes from. Right. So I like calling it Self funded. But like, overall, I mean, to answer your question, like, it's all just business.

And that's why I like to make it more about the money. So that's why I say when you raise money, you're raising money ahead of your revenue. You better make sure that you're spending money in the right way so that you can make revenue at some point. Otherwise, what are you doing? It is not a business. So to me there's a difference between a project, a product and a business.

Yeah, I think engineers in particular love building stuff for the sake of building. And it's a trap that so many engineers get into. And I think it's happening right now with AI. A lot of people are building kind of fun AI stuff for the sake of building it because it's a frontier thing. But many of these businesses, obviously, they're raising so much money.

And revenue is really far off. So it seems like it's going to take a while.

Right.

Before any of these companies can.

When you say, hey, it's just like, hey, you're raising money and you're just doing it in front of revenue. How does that kind of impact your strategy versus what people do? Are you saying, okay, you raise the money, it doesn't mean go spend it, but you better. Every dollar you spend, you've got to be marking out, how does this make revenue in the future? Is that how you're thinking about it?

Yeah. I mean, if you think about first time founders, first time founders come into the situation, they're like, I got because I raise money, I need. I mean the worst part is I need money to start my business. I think that is like the first thing I try to unpack, which is like, wait, why do you think you need money? Is this something that money would actually make sense? Like, is it a. Not even a big enough idea, but is it something where the aspirations you have look like a massive business at some point? Right. So overall, like, the lesson for me is just like.

If I were to put it more bluntly, you have a spreadsheet. Not that most people do, but you have a spreadsheet. It has a forecast, it has hypotheticals. And to me, a business is just a race to actuals in a spreadsheet. If you really think about it super practically, that's all you're trying to do, Right? And so if you raise money, you have money to help you race to actuals in that spreadsheet and make the economics work. If you don't have money and you're self funding, it you're using whatever capital that you can bring in, whether it's through consulting your job, if this is a part time thing or the money you're hopefully making in your business, to kind of get those actuals in the spreadsheet and make sure that the economics work. But again, like, what founders miss, what people miss, is you're still running a business. It's still a business. It's not some project or just a product. It's a business. So, Raj, to your point, like if a developer is just building stuff and they have no concept of this idea that there's a imaginary spreadsheet, it has fake numbers in it, that's what you're operating against and you're trying to get to actuals that make sense, then of course they're going to build a bunch of toys. But we see that every time there's a technology shift because we don't know how to use that new technology effectively. That's actually, I think, the undertone and conclusion I've come to because I had that like, sort of opinion as well, where it's like, how come all these people are just building random shit? And then, you know, when you think about it, you're like, well, it's because the technology makes it easier to build random shit. So is it our fault? Is it the technology's fault? What's the real issue? Honestly, I don't think there is an issue. I would love to see the thousand flowers bloom or be planted and then figure out the ones that make sense to kind of keep watering and growing. So I've come around on this idea that that's a bad thing necessarily. I think there's a time when that accelerates and we're at one of those times right now.

I think one thing that I've noticed is maybe 10 years ago people really didn't care about making money even. And that shift, I think has happened where I think most startups do focus on generating revenue relatively early. And you know, Y Combinator has like got this like, thing where they're like, okay, you know, you need to get to 20k in MRR and then you need to be growing like 10% a week. There's this like, it's a playbook that's like very revenue centric and I think that's great. But one thing I find really frustrating is like, people forget the actual, like economics around that revenue. It's like, okay, you generated revenue, but like, how much? Yeah. And like, fine, you do things that don't scale initially, but like Sometimes these businesses just don't make sense. It's like, how much did it cost you to generate that revenue? And like, what's the sales and marketing? Like taking the whole kind of funnel off, like, like total cac, but also ongoing costs and then churn. That is what is the real business of making a business. And I do feel like people get too fixated on top line revenue growth and then it happens in 2021 was obviously crazy for that and then everyone was like, oh, we learned our lessons and then we're back doing it again. So that part, I would say is the most frustrating to me when I look at some of these businesses.

Yeah, I mean.

You know, I, I probably keep coming back to this theme today. It might be because that's just what's on my mind, but I think this idea of timing and, and having a more conscious understanding of what time do we live in right now? And what are the, what are the headwinds, what are the tailwinds? What are those factors around my business is kind of the way I get out of that kind of thinking. And so what I mean by that is today you can look at it and say, okay, all these companies have raised a whole bunch of money that are model companies, that they're building these large language models because they need training, they need the GPUs, they need inference so that, you know, these, these AI capabilities can actually run.

I actually don't think there's a single thing wrong with the investments that are happening today and how aggressive they are. The reason for that is when we had mobile and mobile was coming up, the same thing happened when we had Facebook apps. And I know you know a bit about this. Facebook apps were where the money was going because that's where the alpha was, so to speak, on where growth was happening. So right now the alpha is growth is happening in AI. We thought models were a special thing. They're turning out to be not as special as we thought, but still extremely important. When AI first came out, this is the way I thought about it. I still think about it this way and that might help people think about it, hopefully, which is, it's just like aws. It's just opening up capabilities so that we can build more stuff, faster and different stuff, but it's just infrastructure and I think we lost that along the way. That mental model of what this AI technology actually is on a very basic level, it's just like aws. To me, what that means is as someone who builds stuff, I can use it to build Better stuff. I could use it to make my stuff. I build more efficient. I can use it to create experiences that I couldn't create without it. And I'm coming from a place where, with crazy egg, back 20 years ago, we had racks of servers in an Orange county data center. We would buy the Dell One U servers from eBay, used and rack them ourselves, and basically our analytics product would run on those servers. Then the first thing that actually came out was simple queuing service from aws. I don't believe we used a lot of that. But then S3 came out. We were a tool that creates heat maps for where people are clicking on a page. We were one of the first tools to do that. We started storing all those heat maps for websites on S3 and then EC2 and the compute came out and we didn't need the racks anymore and we didn't need to work with that data center. And we could scale up and down. In fact, at one point back back in the day, we saved 30 grand a month by moving from a data center to us. Right. We were one of the earliest sort of businesses to sort of work with aws.

So it was accelerant for your business.

Right, right.

All these changes.

Yeah, exactly. And it enabled. And so I lived through that. Now, mobile wasn't as important to most of my businesses at the time, so that transition didn't matter to me personally as much as maybe it could have, should have, would have, but didn't. And now with AI, it's the same thing. I've seen this before. What can we now produce and do that we couldn't do before? As a result, that's my biggest way of thinking about it.

One thing I feel like is different is like take what you guys are doing at Dropbox. I feel like in previous waves like mobile, the incumbents were kind of sitting it out and it created a big opportunity for new companies to come along. Whereas I feel like with AI, the incumbents are all over it. So There's Glean and Dashworks, there's a bunch of startups in this kind of B2B search space, but Dropbox is doing, and I know if it's public, but there's another big company doing something similar as well. So is this a space where for these kind of big ideas, startups can really do well, or is it going to be dominated by incumbents from your.

Perspective, I mean, this. I understand why you're saying it's different, but if you step back, it's not different. It's just the way adoption works. So we.

I guess.

The reason I say it's not different is if you look at the time horizon of where we're at, you would have to believe one thing to believe it's not different, which is a very stupid statement. But we're early. So, so, so I believe we are very early. I don't even believe we're early. And the reason I say that is because the way the investments are going, they're going in the areas where these incumbents have an advantage. What's their advantage? They're throwing billions of dollars at training and models and things like that. That to me points to more. Not that the incumbents are fast and they're moving and you know, they're moving fast or anything. It actually more points to me that we're so early that this is the investment area today. So when you look at the history of the Internet, back in the day. Back, back in the day, this is before aws, they would need all this capex. So all this capital expenditure just to get a website hosted and up, you're talking millions of dollars at one point it required to get a website running. Any kind of website that was reasonable. So where are we right now? Any kind of model that you want running costs a lot of money. But actually that's not true because now the bottles could trade the new models. Right. And there's a cost advantage and you know, there's all kinds of lawsuits and all kinds of crazy stuff happening around that area. But to me, I think we're very early versus oh, the incumbents are the ones that are going to win. I just think we're so early. And again, this thesis plays out with the compute layer versus the application layer. Right. You can argue, and rightfully so, there's certain parts of the application layer that the incumbents are just on top of and trying to do something about. Right. To your point about this space of.

Work, assistance, enterprise search, whatever you want to call it. But I think a lot of it is just because of what stage we're at right now on probably 50, 100 plus year journey.

Yeah.

One thing that strikes me is that with also these things there's like a, we're kind of in the, what do you call the hype cycle. Right. So we're close to the top of the hype cycle.

Right.

And then there will be another trough.

Right.

There's a lot of companies who raise a bunch of money. Many of them will struggle and then they'll be like, oh, this AI thing was overhyped. Right. I think there will be that cycle as well. I think with mobile there was certainly that cycle. Right. With mobile, you know, there was a, you know, a huge excitement when the, when Apple released the App Store. A lot of companies got funded a lot of interesting things. But actually if you look at like TikTok and Instagram and stuff like that, they all came much later. Right. And you know, I think some of the most important AI companies have not been even started yet, you know. So yeah.

I want to address your question though. I think the way I would address that today is there's always opportunity. It's just harder when it's early and there's so much noise. So I think the bigger issue today is that there's just noise and the ability for that noise to get in our heads is insane.

Yeah, I think the Internet has really amped up the interconnectivity. If you were advising a founder that's like, hey, I want to do something in AI, I'm excited about it. Yeah. What would you say is like, you know, here's a space that you should go build a startup that like is interesting. And this is more, I guess actually I'm interested in your answer both if they have venture backed ambitions versus like they just want to do a cash flowing business ambitions.

I, I have a tough time getting into categories and spaces in general because every time like I look at something like, like yesterday company doing an app for folks who are taking GLP1 drugs, right. Like Ozempic and stuff, you wouldn't really think that's an interesting idea. But after talking to him and understanding his business I'm like oh crap, that's a very interesting idea. So I get hit with random things all the time that are so specific, seem small, but when I dig in I'm like oh, that's your cactltv. Oh, that's how the product works. Oh, that's how you're going to grow your thing. So there's just like so much out there and so much opportunity because again this is a transformational technology. Just like us moving to the cloud with all the servers. I'm not saying it's exactly one to one, but it's so close of a paradigm for me in terms of how we build. Right. So when I think about it like that, I go back and I say look, if you believe that finding product market fit has to do with solving problems people have, like finding deep pain, then one obvious example, self funded or venture backed is vertical AI. That's what we're calling it, right? It's really vertical AI SaaS. If you were to really try to bucket it and say, what is this? Then there's other people that are like, oh, it's service as software, right? Which is the idea that AI can do a lot of the manual effort that today or historically has been done by humans. AI can either augment it or make more efficient service businesses, right? So I think there's enough of these tailwinds and categories that you could look at with very little headwind, where if you just go back to basics and say, how do I discover a problem worth solving for someone? And you figure out things like, for me, the human being, whoever I am, the founder, what is the easiest type of customer I can reach? What are the tactics that come naturally to me, it's this kind of mapping that I think is more important than ever now, because I think the opportunities are actually unlimited. And there are certain categories like the service thing or vertical AI SaaS that people latch onto. But the difference between success and failure and those types of things, or even thinking that way, is that individual and what are their capabilities? What comes naturally to them? So when I tend to, like, talk to founders, when they ask me that, I'm like, wait, wait, hold on. You don't want to know what I think is good. You want to know what you think you should do. And so let me help you think. So I tend to give people these frameworks that I usually come up on the spot for most of them or from history that I've done. And I don't tend to go to, oh, it's this framework from this other person or this thing. I'm more like, hey, you have this problem. Let's just come up with a way to think about it. That's all the framework is to me. So you could say, oh, it's from here, from there, yeah, fine. But I'm in front of a founder, I'm trying to help them. The biggest thing I can do there is just help them think. So generally, the way I answer the question is very specific and contextual to what the founder's capabilities are, what they're drawn to, what their backgrounds are, and then help them figure out categorically what should they explore. Because what you're talking about is like that maze. You know, there's a lot of names for it, the idea maze and this and that. But at the end of the day, the things that come naturally to us, those are the things where we tend to have the most momentum that we can kick off And I'm always just hunting for momentum, basically.

I think that's a really profound thought and something I've only learned with time and wisdom is like your own interest and affinities as a founder really should guide your own business decisions, actually. And when you pick your customer base, whether it's SMB, enterprise or consumers or whatever, those are big decisions. And you're picking your boss.

Right.

And that affects your whole life, you know, as a founder. And when you.

When you.

But a lot of people think of starting companies as just like, you know, a product they want to build, especially engineers, I think they think of it like that, right? Especially I did, right back in the day, like, here's a product I want to see in the world. But you don't think about, okay, who are your customers going to be, what type? What's their profile going to be, how are you going to talk to them and are you going to enjoy?

How are you going to spend your whole day? This is something, Raj, you regret, right? Because you were. You were selling to restaurant chains all.

Day and, yeah, big enterprise, corporate America, not fun for me. I mean, you know, but it was good for the business theoretically at the time. And so, yeah, I think that's actually.

Been one of the best things about Mercury. It's the first time that I'm, like, doing a product for myself and my friends. It makes it so much easier because, like, you know, when I get on a customer call, I'm like, yeah, I'd love to talk to an entrepreneur about all the shit they're working on, and then maybe we'll talk about Mercury too. And it's so much better. Like, in my previous company, it was all selling to game developers and game developers, studios. And yeah, it wasn't. Not that I disliked them, but they weren't my people, so it was. It was hard to, like, get excited about, like, selling to them or building that product.

Yeah, I.

So. So just by what both of you said, you can probably determine what both of your personalities are. And by what I'm about to say, you can probably determine what mine is pretty quickly. So what I. What I was about to say is, yes, I agree with both of you, but there's one thing that I've learned, which is if I find myself in a situation with a business, I need to figure out how to love that customer. And oftentimes we don't consciously go into these things with the kind of clarity that you folks just talked about. So then you get stuck, right? You get stuck with a customer that you don't love. That is the worst place to be. There are not much worse places than that. Right. I think Raj, to your sort of experience and point. So that's why if I can catch a founder early, I can hopefully help to redirect towards that. Now, the reason I said the personality thing is I personally. So this is has a lot to do with my personality. I don't really care as long as I can service the customer better than any alternative in the market. That's what I'm going for. I don't care who the customer is. But that helps me help other people help myself. Just think it's not quite true that I don't care who the customer is. As in I have opinions if I'm operating the business. But I'll give you an example first with Crazy Egg, we service designers, because they were the ones that didn't care for the metrics but still needed data. So we built a heat map for them so they could just see instantly where people are clicking where they weren't and start making assessments on how to improve the design. When we built KissMetrics, which was a spin out of Crazy Egg and then raised money, we were struggling a bunch. We probably work with you folks back in the day around Facebook apps and building analytics for them for a minute. Then we pivoted a little bit more. But then we found what my co founder and I loved as an audience, which is marketers. So KissMetrics ended up being a tool for marketers, but if you're building an analytics tool, it's usually supposed to be for marketers. So even Crazy Egg today has very much for marketers. Not that it's not for designers, but the world has evolved. Marketing, measuring your traffic, converting it, all those things are really important. Right? So designer, then marketer, not counting all the weird products I try to build. So we'll save that for some other day because I've. I've built close to 50 to 100 software products with teams myself. Like things I built. So there's a lot of there. So that's where I'm coming from. Then with the latest company. First it was any knowledge worker because we were enterprise search at Nera, which was called FYI. When Glean raised 50 million bucks and we were like, we didn't raise that kind of money, but we're building an enterprise search competing with these folks. Maybe we should not do that, you know, and usually I don't care. But we were all just so early that money was actually going to solve problems at that point for a number of reasons that we discovered. And so we pivoted into serving it people. And now I love it people and I understand them. And it sounds like you're promiscuous.

That's kind of my point. So. So, so, yeah. I mean, just to get to personality type, to kind of close this statement out, I don't think either of you are an enneagram type 9, but I am. And the enneagram type 9 is the peacemaker. That should explain exactly why I said everything I said. I don't really care who I gotta love as long as I feel like they could love me back. Right. Because I'm trying to create peace. So if I sit here and say, I only like this type of customer, this type of audience, I'm not doing my personality a service. I'm not. It's not my mojo. Right. But that also makes me really dangerous when I talk to a founder, because I know how to have empathy for them and empathy for their customer just almost instantly. And that's a little bit of my magic, so to speak, that I've learned I can do that other folks have a much harder time doing, but it goes back to personality.

Right.

I would imagine both of you are like a enneagram 7, 8, 1 or something like that. If I were to roughly guess, those are usually what founders are. Founders are usually not Nines. Because it's not about peace. Right?

Yeah. I'm more of a war maker than a peacemaker. Exactly.

Yeah.

I don't.

I have no idea what my Enneagram is. No worries. It's just.

It's just the concept in my head that.

That I think is Done one before. I think we had someone sent a link out when you and I have done one. We have to look it up, though. But we'll. We'll check it after this.

I like that.

We should do it.

Yeah.

Yeah.

It actually ties to another lesson which is like, a lot of entrepreneurship is knowing yourself, which I think is not obvious. Right. Like, you would think it's knowing products, knowing. But yeah, one thing that. Because it takes so long, like, startups take so long, you have to keep that energy and spark alive in yourself for a very long time and through, like, a lot of hard stuff. So I think if you know yourself, you can arrange your world in a way that, like, you can keep your energy up and, like, keep passionate about it. And I think, like, a lot of doing startups is discovering who you really are as well, which is like, kind of a difficult journey in itself.

Agreed.

Absolutely. Especially when you start a company like, you know, you're in it for a long time so you know, if you go, if you go down the wrong path, you're like stuck there for a while.

It's also the fastest way to self improvement. I don't think there's a faster way to self improvement. From a mental standpoint of personal standpoint. I haven't found anything else that gives me that learning about myself literally on a daily basis.

I mean, I don't necessarily think everyone makes it out to self improvement. Like I know, I agree. There's plenty of people that falter along the way there.

Totally agree, totally agree.

Yeah, no, I, I mean I love, I've loved the journey and it's definitely made me, I think, a much better person. I was reflecting on the fact that I started my first company at 21 recently, you know, and like it was, you know, it, you know, it really shapes me who I am. I'm turning 40 soon. So it's like, you know, after a while you really start actually loving it. You know, the first few years you feel kind of lost. I think, you know, there's like so much to learn, but after a while you really start like embracing it and loving it and, and now I'm having, you know, the best time. So it's, it's, it's, you know, for anyone going through that early phase where you're like, you're on the steep part of the learning curve, they got to keep going. You know, you can, you know, the, the plateau is.

I do feel like it's much easier nowadays. Like there's so much information out there. When I speak to 21 year old entrepreneur, they know so much more than I knew at 21. But I guess at sometimes they're probably like information overload as well, but they know a lot more than we used to.

So that's the counterpoint here I think since we all basically grew up, as I like to call it, in a similar era and there's new people growing up right now. I think one of my pet peeves of that is that they don't know what's good or bad. They might have access to everything, literally, but they don't have the taste or the curation that, that I think we were forced to develop. Partly because there was less stuff and partly because I think it was much easier to be part of the school of hard knocks back in the day than right now because there is so much information you can get lost in.

It and confused yeah.

And don't know, like. Like, one of my favorite things right now to pick on is all these things, whether it's lean startup or customer development or minimum viable product or all these things. When I hear even very experienced people, I'm not saying people who have done it 20 years ago, like I did, or you folks did, but like, let's say 15. So just five years after us. Ish. They don't understand these concepts whatsoever. And they've been at it for like 15 years.

I mean, they know the concepts. You're saying that they don't. Like, they don't.

They don't actually know them. No, they don't know them because the way they talk about them makes no sense. I'll give you one example. And it really makes no sense because they. They didn't. Like, I learned from the people that created those frameworks. I helped them create the frameworks, right? So. So I'm a little purist on, like, not crapping on any of these things because I know where they came from, I know the value of them and I know when to use them. And that's kind of the bigger point. But I think, like, when I hear someone talk about, like, a pivot, all I can say is, hey, that's not a pivot. And they're like, what do you mean? What do you mean? I'm like, you know what a pivot is, right? Like, let's go. Like, I will break down the definition and say, look, pivot means your foot is still in something from the past. Otherwise, it's what I call a hop. So Slack, Slack was not a pivot. Slack was a gaming company. They had an internal tool. They decided that internal tool is what they're going to double down on and build a business out of. Because they pivoted, right? No, they hopped from one idea to another.

And that's actually the biggest good. I think it's better to hop than pivot, actually. I think that's. Maybe that's a separate conversation. But yeah, it is also a pet peeve of mine that people talk about frameworks without truly grokking them and then try to apply them. I think it's actually, my methodology has always been to listen to a lot of good people and then try to come up with my own ideas and never take a framework. Just never take a framework for the framework's sake. You can take ideas from it and try to apply it, but never go like, we are now going to do. We are now going to do scrum. We're a Scrum company. I think all of that stuff just doesn't work. I had this question hidden from something you said earlier. You said that at nira, FYI, you felt that the companies that raised all this money had this advantage and that's not a game you wanted to play normally. I think money doesn't necessarily change this idea of product market fit. But what was it in this situation that you were like, actually money does give a big advantage.

There were factors that caused headwind that made it so that you needed to survive longer for the world to change in some way for those types of businesses to be viable. So a good example is Glean who we were competing with at the time. And then there was another company called Commandee that Dropbox actually bought prior to us. And so Glean, they didn't have a point of view at the time. They were very early. But Arvind had raised like 50 million bucks from Kleiner and a few other firms. We hadn't raised money yet at the time we were going to, but we hadn't raised money. But we had product market fit with individuals and an enterprise search product. We actually had it. Our retention was 60% with early cohorts, flat 40% with later cohorts. Commandee was building a privacy focused point of view on the same thing we were, which is like local desktop whatnot. Right. So there was three points of view. Let's say one was folks from Google with a lot of machine learning experience and very much in person. Like that was their vibe. Ours was fully remote, much scrappier, and we had fit from a usage retention standpoint with individuals, not with companies necessarily. Then you had Commandee that had fit with privacy. Folks who cared about privacy more than they cared about anything else. Right. You look at those three. We weren't going to do the privacy thing. We didn't think that was a big opportunity. I think that's proven correct that like privacy in the way they were trying to do it didn't matter. In fact, the fact that you had everyone's data in the cloud and connected to it mattered more than it was than that it was sitting locally. And we proved that out. But Glean had so much money and ML engineers, if you think about search, you're probably going to need that at some point for that business to be successful, to get to enterprise. So we were kind of boxed out and we didn't really agree with the point of view of privacy. So we, we, we did a real pivot. I actually prefer pivots and hops, but we can argue about that some other time. It's probably just the definition and the purity of you learn something you changed versus I just want to go after a different idea, which is fine. But a pivot is a more business prescriptive way. That's a muscle that I think businesses need all the time. But that's a different story. So what we realized is that the enterprise search products were blocked by it. So then we realized we wanted to make it happy and there was a fast lane there. And instead of that fast lane being let's do enterprise search and make it happy, we realize it has burning problems that they're willing to pay money for. So that's why we even after product market fit, we pivoted from those learnings. I've written about them quite a bit and part of the reason was we had a competitor that we thought we could not beat and it was because of not just the money, but the fact that they had expertise that we would need to develop if we were going to continue in that direction. Instead we found an opportunity where we needed no machine learning, nothing fancy except our point of view. And this is back to like what we do, which is we have a very strong point of view in the businesses I create of marrying engineering and like the edge of what you could do with a user experience that like just solves the problem. And there's like a special place of ideas that I tend to gravitate towards that have that mix. So in our case, even today there isn't a competitor to what we figured out four years ago, three years ago, there still isn't anything that does what NIRA does today. Even as part of Dropbox, even six months in, even glean announcing a bunch of stuff yesterday or whatever, they do not do what we do. And it's because.

Well, it's also the nuances of how we took the problems we heard and fit them into the product to solve that problem better than anyone else. For example, if you want to change a million permissions on documents, there's no other tool that will let you do that except ours on the planet today. And I can safely say that looking at all the things out there, even as of yesterday, right, but those are like just to just to end this one for myself. Like those are like the things that get me excited is when the problem is solved better than any other business in the market, right? That that is an alternative to us. And honestly, imod, like with Mercury, I think you're doing that and I, and I think the results speak for themselves. In that case, I think with Lyft Raj, you guys invented so much of that kind of experience, it's not even funny. Right. These are the things that get me excited is that when you. When you find opportunities where you can do that with your special point of view on something.

Yeah, it's really important. I mean, like, I think competition, like, finding your. Your space within the competitive set and, like, really excelling in that is, like, so important. And, you know, people often look at a market in the beginning and say, wow, there's too many. There's so many companies in this space. Why would you even be in that space? Right? But if you find, you know, these spaces are so large that you can find a seg and really excel in there and then find ways to expand from there, but you can even just build a really good business in that one segment. That's right. And a lot of people are just scared to just, like, even start because they're like, oh, tell me, you know, there's five other companies in this space. Right? You know, I'm seeing this, you know, with both my companies, with Lima and Tribe. You know, Lima is like, we're in immigration, so there's tons of immigration service providers, but we found a place where we can really add value. And then with Tribe, also, I think there's a lot of chat apps, but I think we, you know, we found something that we can excel in. So I actually like those spaces a lot where they're really big and there's actually a lot of scope versus, like, a narrow space that, you know, there seems like there's no one else there. Actually. The restaurant space was like that.

Right.

Like, there was really nothing there where we started. And there's a reason why there's nothing. There is because, like, you know, space itself is challenged in so many ways. Right. Education is another area very hard to sell to traditionally.

Right.

There's not a lot of companies there for a reason.

There's no better hack to product market fit than someone else's product market fit. And I don't mean, like, you copy them. I mean, you find the opportunities within their fit that they're not servicing. That's, like, probably the biggest tactic I would use for basically hacking product market fit, so to speak. Yeah.

Brilliant thought. You know, I think worth a tweet, actually.

You're a prolific tweeter. Actually, I had a question from one of your tweets. You mentioned that, and I recommend everyone follow you on Twitter. It's. Or all your socials. LinkedIn I think you're on there too. And you have a podcast as well. So, you know, you, you talk about like, you know, you recently, I think you had kind of a vulnerable tweet where you're talking about like, you missed the, this energy of like being in the trenches with a, with a, you know, in a startup and like fighting for something. Just wondering what, what was that about? What were you talking about? You know, what was the feeling you were having at the time?

I only know a startup. Startups I have technically a startup or a small business in crazy egg for 20 years. We're only 30 employees there and it's self funded, 100%.

And the culture there is immaculate. There's zero politics, zero bureaucracy, zero bullshit, and people are just able to do their best work. Anything that prevents you from doing your best work is, is the antithesis of an environment that I want to be. So even small issues, whether it's like a little bit of a rule here or there, that might be totally fair and fine, that's going to bug the crap out of me because it wasn't my rule. I didn't make it. I don't agree with it. I don't think it's any good. So that's one piece. That's the aggressive piece. That's why in Slack, my title is Chief Troublemaker, trademark in Slack, at Dropbox, intentionally, because people should know what to expect when they talk to me. Like, that's what you're going to get. You're going to get very direct, very clear, maybe some complaints from me about something.

Right?

And that's what you should expect. If you want that, great. Because all I want to do is win. All I want to do is win. Now that whole thing is how I maintain my personal culture at the company. I cannot maintain a culture even on the team that I'm on because of so many things at the company that are developed that were not mine. Again, this has nothing to do with. Is Dropbox a great company or not? Is Facebook whatever? That's not the point. The point is that at a startup you can control, influence, dictate the culture and how the work is done. At any company that's not your own, you don't really get to do that. And you have to follow other rules, other people's constraints, things like that. Whether I'm good or bad at that is not even the point. I think the point is that the only thing I miss is that cultural aspect that we had created prior to selling the company. And I'm not going to get that back ever again. And that realization is what my tweets about that come from. Right? So again, has nothing to do with where I'm at or what I'm experiencing. Has everything to do with the contrast of the environment I'm in now versus the environment I had the privilege and ability to create with my co founder and the team. Right? And even when I post that stuff, like, I get messages from our team saying, yeah, I missed that too. I'm like, yeah, well, sorry, you know. You know, some people, you know, they leave the company after getting acquired and all that, and they come back to us and they're like, hey, just let us know when you do it again. Because we kind of miss that vibe. We miss that thing. I'm like, yeah, me too. Right. And so it's just this almost cultural shock, right? And then realizing what you had is no longer, but you kind of miss it. So again, very personal thing. Not really about any of the factors or some. Some. Something I don't like. It's just like, I don't think this is for me, but I made a commitment to the people who bought our company to do my very best until I'm done or they fire me. Right? And I'm there to do my very best because I just want to win and I want to help the company win. And that's my attitude. But that requires me to tone it down in so many areas, especially when it comes to my opinions about things.

Right.

And if you've only been a founder, which is me, and never had to work for anyone, think about what kind of issues that causes for your boss. Right? So that's why I'm really grateful for my boss, especially when I tweet this stuff, because it probably causes more issues for it. But thanks, Morgan. Like, it is what it is. You know, he deals with it, but there's obviously some value they're getting on the other side of it. And I would say as a, you know, it's true.

As a CEO of a big ish company, I'm, you know, I like the founders that work at Mercury or the ex founders, because all culture needs continuous molding and because they have this perspective that probably actually does line up to the original founders of Dropbox.

I know you feel like you're maybe pushing back and not being valued, but actually probably you are.

I feel valued. It's the value part. I don't care, because value is up to me, not them. To be honest, as long as I feel like I'm doing the Right. Things. But I agree with your point. I get it. I'm sure some part of Drew loves that I'm there doing causing trouble with that title. I'm sure. Right. Like, I get it. Like, I would love that too. That being said, like, some of us are a little, you know, unhinged at times, and that's definitely me coming from. I haven't had to work for anyone. I'm. I'm a PM right now. I work on some cool stuff. I'm very happy to PM what I do, what I'm PMing, but I'm a PM, right. I've never been a PM before. Do I know how to be a PM? Yeah, absolutely. Have I done all the stuff that normal PMs do, like, or learned how to do? Hell no. Am I learning how to do that stuff right now? Yeah, yeah, yeah. It's cool. AI helps, other things help, but, like, that's kind of where I'm at. Right. So to me, it's more of embracing the fact that this is a different environment, but also being conscious of the contrast so I don't cause so much trouble that, like, it's just. It's only trouble, you know, that would be bad.

Yeah. You know, I've also kind of been, you know, in the position of MI in some ways, like, trying to, you know, get the DNA that you have, you know, a founder DNA into a larger company is not easy. It's very difficult. Those people don't tend to want to work at bigger companies. So, you know, you can typically only get them through acquisition. And you're actually looking for that. You're looking for the troublemakers. You're looking for people who are going to come in and, and not be, you know, polite and not be risk averse and like, trying to save their job. They're. They're trying to win. So, you know, you know, Drew did a smart thing by, I think, you know, acquiring your company and, you know, shaking things up internally because that's the only way you can get things done. And so, I mean, it's really important because you lose that, you know, over time. So, you know, even though it might seem crazy for some people, it's actually a really smart thing. I think in many cases for CEOs to be acquiring founders, you just can't find them in the market as long.

As there's no organ rejection. Right?

Yeah.

Like, like, and that, that's like what I. Not just fear, but like, I, I do my best to try not to have that impact in a negative way. And I think that that's very tricky, depending on the environment, the people. More importantly, your manager. Like. Like, literally without Morgan, I don't know how they would deal with me, to be honest. You know, Like, I really don't.

And no one teaches you how to do these things, right? Like, it's like a new thing for you. It's, you know, it's like, you know.

I mean, I'm 43, and this is my first job. Yeah, yeah, right?

Like, yeah, that is actually kind of funny. We acquired a company in November, and it is easier to onboard a new employee. Like, there's a whole. I mean, there's a whole structure for like, oh, this is our culture. This is like our. I don't want to call it indoctrination, but I call it. This is our process for, like, people. I call it hazy buying into it. But, like, when you buy a company, it's like, okay, they have their culture and, like, you're keeping some org structure there now. You're like, okay, you go through the onboarding process, but it's like, everything's a bit awkward. I do feel like some of the best companies had this time, like Facebook and Google, where they were really good at acquiring people and, like, making them part of the culture. And, like, some of their biggest wins were from those things, right? Like YouTube, at Google, Instagram and Facebook. And it feels like they've got worse at it over time. So there's like. I don't know why that is actually. Maybe there's like a sweet spot where, like, actually the company's big, but not so big that it can't properly work with a startup that joins it.

Yeah, I think only founders can understand other founders. Like, it's really hard for, like, a big company. Like, if you have business executives hiring, like, acquiring companies, it's going to be a cultural mismatch. Like, you need to have a founder who really understands the culture of another founder.

Maybe that's the thing. If the. If you buy a company and actually the new founder is pretty much reporting directly to the other founders or very close.

I mean, one of the first things I do, if I were in that situation where I was hiring founders that way, I'd literally in the first week be like, hey, walk around this place and I want you to get out. To me, everything you think that sucks. You kind of need an outlet for them so they can just let it out. Like, what you do with it or what you decide to do with it is a different story. But if you could have the CEO.

That you, if you, if you gave.

Founders that outlet, I think it would help them level set and, and then you could work with them, be like, yeah, okay, I get it. All these things suck. Great. These are the areas that I agree with you on that you can work on and help us with. Right. Because, you know, and again, I'm speaking from experience, but the majority of my conversations with the people that'll listen are about everything that sucks. They're not about everything that's good. And it's because at my own startup, like, I didn't care about what was good. I really didn't because that's excellent. Like, great. Like, let's not make, let's make sure that's never bad. But I only cared about what was bad. I only cared about what needed to be fixed.

Right.

Like, it's like a complete find problem solve problem. The more of those you can, the more of those cycles you can go through in a startup, the faster you can grow. There's, there's, there's no other way to look at it. A business is the same way. So anyway, not that you need my advice on any of this, but that's what I think would help. I think it would help solve some of the problems of organ rejection and things. And also directing a founder towards the right problem you want them to solve. Yeah, and that's, I think that's right.

I mean, the way you describe it sounds like you'd be like an annoying complainer, but I think as long as it comes with like, oh, this is how we'd fix it. I think that's like the, I guess.

Even if it's annoying complainer, that piece of it is just so that the founder is not disruptive in your organization. That piece isn't about anything else. But then you also give them the space to be able to say, hey, this is what I think.

Yeah, let me go fix it.

Right? And then you tell me which of these you want me to fix or if there's some other problem you want me to fix. But these founders, when they come to you like they're problem solvers, they had to solve problems just like you did in the early days of your company. You want that energy, but you don't want that energy being disruptive and going after things that you are not willing to change or you are not willing to improve for whatever reasons or you think are fine. And usually you as CEO, know exactly where the bodies are buried around these kind of problems. Like, you probably know right now better than anyone else. What that number one problem is. That's going to unlock growth in your business. I don't need you to share it. That's not what this conversation is about. But, like, then you know that. Why wouldn't you want an aggressive founder on that?

Sure.

Thank you, Hitman, for joining us. This was a great conversation, but you should do this more often. I think we. I learned a lot from you. And, you know, we should keep doing these.

Yeah.

I feel like we could have talked for another two, three hours, turn into one of those Lex Friedman ones. But appreciate you coming on, Hitin.

Yeah.

Thanks for having me.

Yeah.

And see you all next week.