The Foundation To Successful Blitzscaling with Greylock's Jerry Chen | Greymatter

Hi listeners. I'm Reid Hoffman. This next episode of Gray Matter dives into sections of my new book, Blitzscaling the Lightning Fast Path to Building Massively Valuable Companies. We share stories and advice from entrepreneurs who've grown companies from zero to a gazillion. To learn even more about how to scale at a dizzying pace and blow competitors out of the water, you can pick up my book on blitzscaling.com, amazon or at a US bookstore near you. Enjoy. Greylock Partners Podcast Grey Matter thank you.

Hi everyone. Welcome to Grey Matter Greylock Partners podcast that offers perspectives and stories from some of the world's top entrepreneurs and business leaders. I'm Chris Yeh, the co author of the new book Blitzscaling the Lightning Fast Path to Building Massively Valuable Companies, which I wrote with my friend greylock investor and LinkedIn co founder Reid Hoffman. This episode is the second in a five part series where we host several investment partners from Greylock to discuss their experience building tech companies from startup to scale up. Today I'm joined by Greylock General partner Jerry Chen. Jerry invests in entrepreneurs building new enterprise SaaS, applications and in all aspects of AI and cloud infrastructure and has backed companies including Docker Blend and spoke. Jerry, it's great to talk with you today.

Hey Chris, it's great to be back on the show and it's good to talk to you.

It's always a pleasure, sir. Now, in this episode, we're going to dive into one of the three core techniques of Blitzscaling Business Model innovation. We'll discuss how to design a business model that maximizes four key growth factors and minimizes two main growth limiters. Share some proven business model patterns to help inspire your own business model innovation and then share stories and learning lessons along the way. With that, let's go ahead and dive in.

Sounds great.

Now, Jerry, one of the things about Blitzscaling that we've discovered in talking with folks is that a lot of people think it only applies to consumer companies, but I think it really applies to enterprise companies as well. You're an enterprise specialist. What do you think about how Blitzscaling applies to the enterprise?

I think blitzscaling is absolutely key in enterprise companies when you can find those opportunities. Ultimately, if you take a step back, Chris, it's about good versus great. There's a bunch of good business models, a bunch of good outcomes, and good companies. As a founder, there's only a handful of great ones. The difference between good versus great is your ability to blitz scale and we'll talk in the future all about this accelerated distribution, how to get to market fast, get market share faster and really go big fast. And that premise for consumer companies also holds for enterprise companies too.

One of the things I love because you came to our class at Stanford and one of the things you said that always stuck with me is that every billion dollar business started as a $10 million business. And that's something that's always resonated in my mind.

It's true. It's often this kind of paradox that as a founder you need to see the big vision and see the late innings or Act 3 of the business, but focus on execution. Act 1. And oftentimes you don't get out of the early innings, you don't finish act one, you don't win early, you never earn the right for that billion dollar revenue stream. Unless you have a single product that costs a billion dollars, you're never going to get there by one product, one sale. And so what's really key is starting out correctly. We talk about a lot of companies in technical debt from day one. You also inherit business model debt from day one. If you don't start with the right business model, the right pricing, the right go to market, the right moats you're building, you can't scale that correctly and try to blitzscale something incorrectly with the wrong business model, that business model debt inherit will swamp any other success you have.

Well, let's start there because I totally agree. The concept of the business model is really important. The companies that do amazingly well in the marketplace are the ones that really innovate in terms of business model. So when you say business model, what do you think of as the business model? What are the key elements that need to be there?

It's really what problem you're attacking. How are you charging for it, the unit of value, how are you going to price for it? Then how are you going to sell it? Going direct, you're going through resellers, going through a channel, you're going to market with partnerships, Are you going to build something on your own details in technology? Are you selling on premise software, cloud software, are you open sourcing it, or are you doing proprietary software? So the nuances in the packaging and pricing differ, but it's really what problem you're solving. How are you going to charge for it and how are you going to sell it?

Now do you think people need to decide all those details up front? How much are they allowed to figure out along the way?

Well, I believe that you're not going to have everything figured out and you need to iterate quickly because the market's pretty dynamic and changing. You launch a product or competitors react. But that said, once you find product market fit, that's a key lens pin in the early journey. But also you need to find what we call product go to market fit. What I mean by that is the product and the channel, how you sell the product have to match. It's like if you have a low price product like Dropbox or email client that's largely sold through the app store self service, that's great. You don't need a large enterprise salesforce knocking on doors to do that. But you have a large piece of enterprise software, be it hr, financials, erp, you need a large salesforce professional service team and what I call a large unit of value to make that work. And we've seen business models fail because the missed massive product in the go to market fit. And then they start spending money when they're losing money in this equation. And then those are where companies, what I call the dead zone, they basically blow up because they're trying to churn and scale in a blitzscale, in fact business model that just isn't sustainable.

So what I'm hearing is that when a company sets out and they have a technological innovation or a product of some kind, some of them lend themselves to a low price point consumer approach. But other ones are going to require a real emphasis on the go to market, the go to market fit, as you said. How do you help companies achieve that kind of go to market fit?

It's always working backwards actually. From who the Persona, who's the buyer and how does the customer want to consume the product. So if it's an individual single player product, like a productivity tool or developer tool, that is a direct go to market, probably through a cloud or SaaS service. If it's a product that has a central buyer like cio, ciso, VP Engineering, that's probably gonna be a top down sale. So you gotta understand a couple things. Who the Persona, how they like to buy their products, how they want to discover the products. And once you kind of figure that out, you actually have a way to triangulate the right fit. Another way to think about it also is if you're a budget replacement, so you're replacing the existing product. And a lot of enterprise software products are like cheaper, better software, cheaper, better storage, better application. You're probably doing okay going top down if you're a budget additive. So I try and convince you, Chris, to buy something Net new that you hadn't budgeted before that you haven't thought about before. I probably go bottoms up. Because what you're really going to want to do is the individual developer, practitioner, if you will say hey, this widget, this software that I never heard about before, I need to have that to make my life better. Because the top down person is like, no, no, my budget for the quarter is done. I'm not open for new business.

So when you think about business models, what are you looking for that tells you this is a sustainable business model? And what are some warning signs where if you see it you're like, ooh, I'm not sure if these guys have thought it through.

When I look at a business model there's a couple things to look for. One is this same business model we've seen before, direct sales or channel sales, budget replacement, but just a pure execution play. That's question one. Question two, is there innovation in the go to market in the business model itself. And that's often the case too. And you see a lot of blitzscaling companies and that's from either they sell to a new buyer directly to the practitioner, be it the developer or the designer, or they're charging for something different. You know, Microsoft sells Office on a per seat basis. Google basically gave away Google apps originally for free and sold ads. Same for email. And that's super powerful when you can actually sell your product for something your competitors because like I said with business model debt, your victims your own success. Microsoft isn't changing their per seat, per person license of Office to compete with Google. That's giving way for free and selling ads. So first question is same but execution two, are they innovating on channel, be a practitioner or how they charge? And three is as these business models scale, then you try to picture ahead 3 years, 4 years, 5 years is this sustainable? And ultimately you want business models that work for you, which means the bigger you get, the easier it gets. You're building some kind of sustainable moat. And this mode could be scale, network effects, brand stickiness and switching costs. So ultimately you find a business model works for you. Then you have something that I think could be very special.

And one of the things that we talk about in blitzscaling is because blitzscaling is all about speed. There has to be a reason while you want to get there faster, there has to be some benefit from achieving that scale. And I think you just described that there's a variety of ways for that benefit to be there.

Yeah, the classic is you're in a race versus incumbents. Right? And so I think my partner, Neil Bush, where he used to say David versus Goliath is technology versus distribution. So can you actually build distribution, get to your customers as a startup before the incumbents can build or buy technology to compete with you? So if there's a race with incumbents, then blitzscaling makes sense because oftentimes for a lot of these new markets, the market share settles down 2/3, 1/3. And so it's like first to scale, first to build. This moat of switching costs or brand makes it very sticky for competitors to get undone. So you think about the cloud space. Amazon Web Services was first over a decade ago and now they're at a $20 billion run rate each year. Microsoft number two is a fraction of that, maybe a third to 25%. And Google number three is a fraction of that. So you think about Amazon, Blitzscaling and cloud. They were first, they charge on a different unit value than Microsoft operating systems or Dell servers. They charge on a per hour per day for your compute. They change the channel going directly to the practitioner, the developer versus selling to the cio. And they blitzscaled that knowing that there were economies of scale, network effects and switching costs. So they got there, they got there fast. And the journey is still early in the cloud. But it remains to be seen how deep the inroads can Microsoft and Google make. It'll be fun to watch.

And that is a fantastic example because when you think about Amazon web Services, it's not necessarily purely a technological innovation. Microsoft offers cloud services, Google offers cloud services, even IBM offers cloud services. But Amazon really has an entire system based around a different business model that was differentiated and allowed them to capture that lion's share.

It was all the elements you want for blitzscaling in terms of, like I said, reducing friction in the product go to market fit. And when I say reducing friction is they sold directly to the developer, right, the individual IT person. So they change the practitioner, so they change the buyer, they change the consumption model on how you charged and they were able to go fast. And like you said, this ecosystem they built has just compounded. So you think about business models that work for you. Like I said, at the scale over time, Amazon's business model now works for them because now you have more customers on it, more data on the cloud, more applications using that data and more and more vendors on that same cloud to take advantage of all the apps, all the services and all the customers in that cloud.

Now I want to dive in on that one element which is really focused on the distribution. Because. Because I think you've talked very strongly about how distribution is important and in fact distribution is one of the key factors in Blitzscaling, along with market size and a few others. You mentioned how Amazon Web Services really took a different distribution approach than previously had done. Has that approach remained consistent over time? Has it evolved? How have they been able to continue to make this a strength for them?

It's interesting. Companies and vendors need to grow up and evolve with your customer. And from day one, your customer, your unit value and your business model may not be the Act 3 or the late inning business model. And so Amazon started with a handful of services like compute, networking, storage, selling directly to practitioner, and 1012 years later, they're actually selling to the VP of engineering, the CIO, the CEO, the CFO. So they actually changed and evolved their business model from this small consumption unit value that still holds. It's kind of their bread and butter, but they've added to it the ability to sell directly to a centralized buyer. Now helps are selling cloud services versus physical servers and physical storage boxes, which was the last generation. So their cost of goods, their cost of delivery, the cost of sales are dramatically different. But they were able to grow up with their customer base and evolve into this $20 billion business. And so it's interesting that oftentimes you have business debt, technical debt, and you can't overcome that if you screw that up. But also founders need to realize as you go through this journey, you can add to your business model and evolve it over time and create this kind of nonlinear value.

Absolutely. And one of the things we talk about in the book is how a company really is almost fundamentally different at each stage of blitzscaling. As they go from a 10 person company to 100 person company to a thousand person company, you can't expect all the elements to stay the same. And I know you lived through that when you were helping blitzscale VMware. What were some of the things that you really remember from that experience?

It's a combination from people you have around the table. First and foremost, the learning, the DNA number two is being swift and capable of changing direction of who your competitors are and how you sell the product and how you pitch it. So first and foremost, the team that got you from 0 to 1 or 0 to 10, 10 to 100, 100, 1000 isn't necessarily the team to take it from 1000 to 5000. Oftentimes you find talented individuals that grow with you through all these Stages and you have founder CEOs like Diane Green was to grow through these stages. But oftentimes you got to mix that with seasoned DNA and experiences, right? So you have your core stem cells or the founders and founding team. You want to add some experience and knowledge to grow that. So one, be thoughtful about the right personalities and skills you're hiring for at least each and every stage. And that's from engineering, sales management, HR operations. Secondly, as you grow you got to realize your throw weight changes right? From the scrappy upstart startup that you're really the rebels and can be a little more irreverent. When you're selling your product to all of a sudden you're selling to CIOs and CEOs and CFOs and you realize that the first rule of enterprise sales is don't get the customer fired, right? Because he or she is making a bet on your software. Be security, storage, enterprise applications, productivity suites. And second role of enterprise software is make your customer the hero. So this person, this woman buys her product, she's super successful. If you're successful, but oftentimes a consumer, you kind of iterate, fail and you have bug your software and you just keep iterating, iterating, iterating because the population is so large. Enterprise software, don't forget some of these things are mission critical products that are powering your website, your store, your business, your hr, your financials. And you can make sure that there's no flaws that will bring the software down or create security vulnerabilities.

Now one of the things that happens as you're distributing your company, as you're distributing your software is you're talking about, okay, so what kind of distribution channels do we use? One of the ones that's very common in the consumer side is, is virality. But it's not something that people think about as much on the enterprise side. Talk a little bit about how virality can actually figure in on the enterprise.

Virality is pretty obvious in your face as consumer, right? You get an email, get a message, hey, your three friends are on this social network or you get invited by your friends to join the social network. And it depends on enterprise products. Not every enterprise product lends itself to be viral because they're either single user or single player mode or there's no way to share and invite other people. So I'd say certain products, especially in productivity messaging, things like Slack products like Dropbox, et cetera, certain enterprise applications that inherently are collaborative, multi team users lends themselves to Be viral and that could be as productivity oriented, like an individual user, like a product that we're investors in called figma to even security products where security professionals that are working in data center can invite other folks. So I think that if you can create virality in the product within a company, that's great. And then thinking between companies, between enterprises, that's the next level. And that happens oftentimes when you have platforms OR Standards or APIs communicating between different companies. It's a little harder, I would say it's a lot harder to have that reality. But you can find that and bake that into your product from the get go. That's a great moat you can build upon.

One of the things that we share among others is that we're old fashioned in the sense we actually went to business schools and learned all this accounting stuff. And one of the things that you learn in accounting and finance is the concept of gross margin. And we actually talk in the book about how high gross margins are an important part of blitz scalability. How do you think about gross margins as you're investing, as you're advising these companies?

I think gross margin, the exact account definition, isn't the most important thing as that a high gross margin means value, right? In my mind it does two things. One implies the value that you're charging for the product, implies the value that you're creating for a customer. With any product we're selling, between me as the vendor, you as the buyer, we're creating value. And then it depends how much of that value, be it increased revenue, decreased cost that we're splitting between us, right? It's like, hey, if we create $100 of revenue gain, should you get $100 or $99? I get 1. And so the more powerful my product is, the more irreplaceable, right? High switching costs, no substitutes, means that I can actually charge more for my product, have higher gross margins mean charge more lower cost. And that means that I'm actually building something super valuable. And over time, high gross margin implies maneuverability. I can drop my price and face competition. It means that over time, hopefully my gross margin is improving, which means I have benefits of scale. So my costs are going down as my revenue is going up or staying the same. And number three, it gives me more freedom and flexibility to invest that dollar. I'm gaining on every unit I sold back in the business to feed that kind of blitzscaling engine, that hungry beast, if you will. So it's a powerful metric that implies a bunch of other Things you can do with the business beyond just the margin percentage itself.

Now, one of the other things that you had mentioned is the potential for network effects to be a part of building the moat. And when we think about the consumer world, obviously network effects are really important for companies like Facebook, for example. But people don't see it as much with the enterprise. But there really are network effects at play in platforms and standards and the like. Can you talk a little bit about how companies can encourage the formation of those network effects?

Well, yeah, network effects obviously is Metcalfe's law. Right. The more people on the platform, on the product, increases value for everyone else. And the original definitive version of this with operating systems, Right. Microsoft built a franchise on network effects, saying, hey, everyone using Windows, standardizing Windows created benefits for PC vendors, server vendors and application vendors. And so when everyone's standardized on Windows, you know, benefits the whole ecosystem, not to mention training, education, et cetera. And so I think in the enterprise market, if you have network effects, that helps your blitzscaling. This one increases value. So every additional customer you bring on creates more value for every other customer you have in the past and every other customer you have going forward, which means that it can charge more, potentially increasing your gross margins. And also it creates a moat because it becomes stickier and harder for competitors to say, let me undo this operating system, let me undo the standardization on Slack or email or Google Apps and replace with my new widget, my new product, new operating system. Yeah.

Although it is amazing, sometimes there are companies that are able to come in and upend everything. We talked about the example of Amazon Web Services services before. I think that you could argue that historically the pattern was data centers on premise and web services was able to upend that a bit.

It was so you would say Amazon came in with network effects that was able to break the on premise power of both Windows and the other operating systems, Linux and Solaris, and did a couple things. One, cloud and cloud services reduced the friction. Right. So one of the things about getting customers onboard your product to add to the network effects is how much does it cost to add one more customer? Consumer is almost cheap to free. When you're selling enterprise software on premise, it's pretty expensive because Cloud and SaaS like Salesforce Workday ServiceNow really reduce the friction to add another customer, another user, another vendor. So they're able to build network effects pretty quickly by reducing the friction for adding the next user.

Now, we've talked a lot about these growth factors now that really power blitzscaling and make companies more blitz scalable. But the other side of it also applies. In the book, we talk about some growth limiters, things that get in the way, whether it's the lack of product market fit or the difficulty in actually scaling the organization and operations. Can you talk a little bit about how you help companies overcome those?

Imagine a couple limiters. So there's things you can control like your own operations in terms of people, talent, functional things within the business, limiting your growth as a business. And those things you can't really control, like market size or market limits. And so I think as a board member investor, you gotta be thoughtful about two. So in the first around scaling your own business, that's oftentimes things you control, right? If you screw that up is what we call unforced errors. And that's at every step. The way you're scaling yourself as a founder, scaling yourself as CEO, you're adding talent, you're investing in infrastructure, investing in information, you're investing systems, you're investing in platform technologies to make sure you had the scaffolding to grow that business through blitzscaling. The external factors you can't control. Market, competitors, buyers, those are tougher. So when you hit a wall in terms of market size, you have to do one of two things. One, are there things you can do as a founder, as a company to change the slope of the demand curve, actually increase the tam, increase the market size, or do you move to an adjacent market or move into another product category, then actually continue the blitzscale. And I think when you hit the first internal things, you gotta make sure you're growing along the way. And then in the second, as a board member, you kind of try to see six, 12, nine months ahead to make sure, oh, shoot, we're going to hit a wall here. We're going to hit this asymptote. How do we either change the slope of the curve or move to a new curve?

So I'm very curious. Can you give a concrete example of a company that was able to make one of those shifts? It could be a company that you had invested in or a company that just observed this.

There are several companies inside and outside the grill, like Portfolio, that have done this successfully. And I say a lot of companies need to start working on Act 2 or Act 3 before they're done with Act 1. So a company I'm involved with right now, Blend, is selling mortgage software to bank and non bank lenders. They're already working on Act 2 or Blend 2.0, Blend 3.0, so they just launched a home insurance product, for example. So they saw their core business selling software for powering mortgages for home buyers. And they kind of know the size of that market. And they're years away from penetrating and saturating that market. They're ready to think about how do I add another curve like home insurance on top of that curve. So they're being thoughtful about that. A company like Workday, that's still hyper growing, hyper scaling after all these years, started HR software, human capital management, they moved in financial software. So they're adding a whole nother market, a whole nother tam, a whole nother curve to climb up. And then you see companies outside the portfolio like Slack, that people thought was kind of messaging for engineers and technical teams have really moved to kind of messaging through the entire enterprise for productivity workers, sales, marketing, hr, et cetera. So it's either a adding new curves that are built upon the previous curve, adding parallel curves side by side, or you change the slope of the curve. The last one, this TAM expansion is one that we often don't see. I think consumer investing is, you can never really predict the size of the tam. And that's what makes consumer investing so hard, but so rewarding. A lot of enterprise software is budget replacement, occasionally is budget additive or new spend. But in enterprise software, you can find a way to shape that curve and shape the slope to increase the TAM over time. Now that's powerful.

So one of the other elements in the book that's very practical is that we talk about proven business model platforms, things that have emerged over time which are able to allow people to tap into growth factors and design around those growth limiters. And some of the patterns we discuss are things like bits rather than atoms, free and freemium marketplaces, subscriptions, digital goods and feeds. But the one I want to focus on today is the platform business model, because that's something that's been very powerful in the enterprise. I know that some of the companies you've invested in use that platform business model. Can you talk a little bit about the platform business model as a whole and then specifically some of the companies you've seen tap into it.

It's a powerful business model if you can build a platform. And it's often the P word, right? Everybody aspires to build a platform, but no one often achieves it. And there's two things to think about when think about a platform business model. First and foremost, customers don't wake up saying, I need a new platform, right? No cio, no VP of Engineering says, you know what? I need a new data platform, I need a new operating system platform, I need a new messaging platform today. So first and foremost, customers don't buy platforms, they solve problems. Secondly, a platform is achieved when the ecosystem around your product actually creates a lot more value than just your product yourself. So you think about operating systems like Microsoft. The applications on top of the Windows OS was a huge platform. I've been lucky enough to be involved with VMware, which we used to say, every dollar software bought by customers of VMware software result in $8 or $10 of other software or hardware around it. Storage, compute, applications, backup. You think about Amazon. This became platform. Now this, the cloud company. For every dollar of AWS revenue they have, then the amount of dollars of vendors on top of Amazon is 5 to 1, 10 to 1. So two things. One, customers don't buy a platform. So be thoughtful about your wedge, how you land. And number two, a platform is where all the ecosystem players around you, on top of you, beneath you, actually accrue a lot more value. So first and foremost, you don't wake up saying wannabe platform. You say, what's the initial wedge I can solve? So you could be like Docker, which is an application platform for modern apps. How do I containerize my apps to create lightweight applications and microservices? Then over time, customers standardize on Docker as a development platform for the applications, very similar to VMware. In the early days, a company like Cloudera, which we're also lucky to be involved in, they were trying to solve a big data problem. How do I process petabytes or terabytes of data? And then they say, oh, how do I build solutions on top of this? Like customer intimacy, security, customer 360. And then once you have this platform or this product laid near a customer, solving one huge pain point, they start to build other things around it outside the grill, like portfolio. You look at companies like Splunk that really started log analytics. Now they're angular security and other services around them. So you solve one problem really, really well. You have lots of distribution, lots of seats, nodes, users, and then you start building on top of it. But you have to earn the right to build a platform business model.

Now, I think we've all seen that YouTube video with Ballmer jumping up and down screaming, developers, developers, developers, developers. And obviously that Microsoft pioneered the platform and developers are a big part of the platform, business partners and the like. How do you attract people like that to your nascent platform?

Well, developers are A special case indeed. First and foremost, the power of developers is what I call practitioner led go to market. In particular, what Steve Ballmer was articulating was developers are decision makers. They actually add value to your platform by building upon the Windows API. But in this day and age around cloud and SaaS and mobile, that developers in both the buyer, the decision maker and the creator. And so I think the value developers is kind of tripled or cubed at least since you know, that video went viral years ago. And so I think for enterprise software, developers are a key ingredient to the platform because one, they're the practitioner led sales, but also they add value. So if a developer starts using your product, be it develop a database product, application infrastructure product, or even a SaaS product that they're customizing with their own apps around it, they create value on top of you and they make it sticky, AKA switching costs, which is another mode. So again you're blitzscaling by going up big and fast at the same time building a moat around your company with switching costs and network effects.

So I mentioned some of those business model patterns that are very typical of the enterprise free and freemium marketplaces, subscriptions, digital goods feeds. Where do you see a lot of potential over the next five years? Where do you see the enterprise going and how is it going to tap into some of these consumer oriented patterns?

One of the business models that we talk a lot about recently is systems of intelligence, right? Which is basically you think about different quote unquote platforms or system of record that were built over the past 20, 30 years, customers, CRM data, employees, HR data assets or IT data. And those are all platforms, they're all kind of moats. And one of the business model innovations we're looking at is how can you as a startup build a product across multiple platforms, across multiple systems, record and build what we call a system of intelligence or soi, using AI or ML that is uniquely advantaged to use a startup because an incumbent can't do that. And B, as you build this application, you actually build scale, right? Because the more data you can ingest from multiple platforms, the more, the better you get, the bigger you get. So I'm pretty excited about that as a platform, in terms of technology, in terms of business model and go to market. I think a lot of changing who you sell to is evolving. I think we saw the first big shift from centralized it, the CIO buyer to the developer buyer, right? And Open Source and SaaS played a big role in that. I think there's plenty of other Practitioners inside the enterprise, be your designer. So the buyer of a product that we invest in called figma, your CFO is a practitioner, your finance professional, practitioner, your HR leader is a practitioner. So increasingly we had this world where centralized it made every decision, and now every individual is now a practitioner, buyer decider. So I'm excited about finding new decision makers, new buyers, new users inside the enterprise.

And I really like how you put that because it seems to me that what we're talking about is the next generation of the enterprise. We had this previous generation really kicked off by salesforce.com, the beginning of the SaaS movement. But now what I'm hearing from you is, hey, we've created multiple cloud platforms. Now we need a meta platform to allow us to navigate between those cloud platforms to form it into a whole. Or alternately, we've sold to it and we've even sold point applications to specific business units. Now those point applications are becoming bigger and becoming platforms on their own. So it's really a natural evolution from where we've been.

It's an evolution that we're seeing played out in real time. And one of the ways I like to think about it, from small to big, just tying this conversation from the earliest talks around Windows and the desktop to where we are now. Look, software in the enterprise, all about digitizing a business process. We started by digitizing your desktop for paper creation, messaging, memos, email, spreadsheets. We digitize the desktop. Then we network the entire company with LANs, Local Area Networks, and we digitize a business process. Hire to fire, order to cash, right? CRM, HR stores, and now with Wi, Fi, LTE, mobile phones, ambient voice technology, and all the IoT things we're seeing, you're now extending the reach of the technology into multiple companies and through a whole vertical workflow, be it construction, healthcare, finance, and now we're digitizing all of that, right? So digitize your desktop, digitize your company. Now digitize entire industry or multiple companies to communicate with each other. And what we're seeing now, a whole generation of companies building the system intelligence across your desktop, your enterprise, and soon your entire vertical.

So I think it's hard for us to possibly come up with a better conclusion than that. That was an amazing summary, Jerry. So let me just go ahead and thank you for coming in and sharing your insight on best practices for scaling massively valuable companies. It's great to have you here on gray matter.