Rising Above the Noise in Consumer VC with Kirsten Green of Forerunner | E1961

Say anything the you want. I'm going to riff off you and take it in different directions. Okay?

All right. Something has to be both novel and both a utility. It needs to have an element of uniqueness to stand out in the market and cut through the noise. Okay, yes, you address the need. Then you also have to wow people. You have to give somebody a reason to want to talk about it, a reason to want to try it, a reason to tell somebody else about it. Something that captures the imagination to trial, and then you have to deliver on something that's really good.

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Simplified Finances welcome back to this Week in Startups. I am not Jason Calcanis. I am Mark Suster of Upfront Ventures. I'm so excited for my guest today. It's Kirsten Green who is the founder of 4Runner Ventures. She founded it 12 years ago, has raised in my estimation about $2.3 billion. And for anyone who doesn't know to go from zero in 12 years, founding a firm raising $2.3 billion is an enormous achievement. She is probably the best known consumer investor in venture capital of our era, having backed players like Chime, Warby, Parker, Dollar Shave Club, Glossier Hotel tonight and others. Welcome to the show.

Thank you, Mark. And thank you for that very kind introduction.

It's pretty succinct, right?

It's pretty succinct. Hopefully it's all true.

Amazing highlights. 45 seconds or less. Listen, I want to start with founder advice, okay? I like to just get into the meat and then we'll back up a bit and we'll talk about the market. I want to start out with a bit of advice for founders so we can give some value before we step back and talk more broadly about the market. If I look at My data, I think about 7% of VC dollars are going consumer companies these days. That's pretty small relative to what it was in the past. Let's say it's out of favor right now. Hopefully it doesn't stay that way. But if you were a founder trying to raise money in this market where only 7% of the dollars are going into consumer, what would you do to stand out? And why are you still so bullish about consumer.

I think that to start with, why is so little funding going to consumer businesses is relevant to state that, which is it's been expensive to consumer companies. There was this thing called social that came online. It really created an opportunity for businesses, digital businesses, to get in front of consumers and for there to be network effects and all of that. And I think it allowed discovery and propelled discovery. It has gotten expensive, it's gotten crowded. It's gotten expensive. You know, one of the things that I think exciting about consumer businesses is they do have the potential to go after large markets, but you also have to get large audiences to really demonstrate and show your product. And that can be, you know, that that is an expensive endeavor to get after. So, one, it's just a lot of upfront marketing and cost. Two, it's a very crowded marketplace because there are low barriers to entry. There's high barriers to scale, but there's relatively low barriers to entry. The Internet has become a overwhelmingly crowded space. And rising above the noise is hard. It's harder than ever before. And in the face of crowded ad markets and expensive ad markets, it's even harder. And then there's the reality that, like, consumers can be fickle. And I think that scares people more than it needs to. But that's like a prevailing, you know, kind of perspective. And so all of that sort of has people leaning out on consumer in general. From the investment side, I think things do go cyclical.

I want to explain to users just how this works. Okay, so upfront was doing a lot of consumer between 2012 to like 2015, 2016. And we actually ourselves carved back and started focusing way more on B2B and way more on, like, tech, deep tech products starting around 2018. And I want to explain why Chris Dixon, I think says it best. He said the social networks are about attract and extract. And what he meant was in their growth phase, they try to attract massive audiences of viewers and massive audiences of people who want to spend money. Once they get the network, they're so.

Frustrated by the healthcare system. If you haven't been abandoned by it yourself, you've heard of, you have a loved one has, or you have a close friend who has that people are finally at the place now where they're taking things into their own hands. And part of that is because we have information and we're starting to get more tools and we're being more proactive about it. And so health is really a huge category and focus for us. We think that the consumer's opening up their wallet for it and they're going to continue to open up their wallet for it. It's not just health care, it's well care. It's moved into the zone of being proactive. It's part of living your best life. In fact, there's a building narrative that supports that trend and we see that as having gone beyond just the hardcore kind of early adopters getting into the mainstream. So it's an area of consumer spend we think is continuing to grow. So we're spending time there.

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Then we're looking at saying where are the opportunities that business is missing the mark, where there's some needs. And this, you know, kind of pretty quickly dovetails into what I said earlier, which is like, health care is missing the mark. So like how do we live healthier, better lives? Like what products, services can help us do that? In the realm of wearables and data and quantitative self, those are things that didn't exist before. There are tools that people can use. They're things that can inform decisions and Build habits. So that's a new product and a new service to meet that need. And then you go down to kind of like the technology and the business model, innovation. And the reality is, is that the ability to get all of the data off of your finger and to put it into a small little device like a ring, like, is something you couldn't have done a few years ago. But at the time when Aura was just starting, they were really pushing the envelope on what could happen in a very small chip in a very small device, and bringing something to life that couldn't be brought to life before. And that, when you're first to market, is an advantage in just standing out. Right. So going back to what we were talking about before is like, what's the wow factor? There are several other rings on the market now, so, like, competing on the form factor isn't enough. But at the time, it was novel, and maybe you would have looked at it and been like, I don't want to wear another ring. I'm not even terribly comfortable having one ring. But there's another part of you that's so interested in your health, that's so interested in the game of health and keeping up with it that you're willing to try it, and then you're wowed by the experience.

I think that there were people who came out before oura ring, by the way, and I'm sure you know this. Brad Feld famously had invested and talked a lot about this. It was like, sleep is important to quality of life, and therefore I want to track my sleep. But they were little things you wore on your head, and what they didn't quite get right, I think, is the form factor. You know, many people have a partner in their bed, and you don't want to look unless you have to. You don't want to be that person with the funny thing on your head. So nailing the ring, I think that, well, this is my wedding ring, and I'm very happy to wear a ring. I wear my aura ring only to sleep, and it's perfect for me for that. I know many people wear it for exercise, but nailing that form factor, I think, was a big unlock.

It was. And I think from our standpoint, we built early conviction that there would be enough willingness to do that, given the strength of the value proposition in the data and the other information people wanted. It also has the factor of, like, it's on your person. And so you're walking around with it and you talk about it versus that headband that you just Referred to. The only person that's going to see it is the person sleeping next to you. And that's probably an unfortunate display of the product at that point in time. Yeah.

The thing I would say to anyone thinking about consumer that I've often thought about was Livestrong. And obviously when the person behind your brand becomes a fraud, it's harder. But, you know, people proudly wore, if you don't know, was Lance Armstrong's thing and they proudly wore the yellow band. And in a way, like, wearing it was a status symbol. It was like wearing, I don't know, whatever. You know, people who want to wear a brand around Balenciaga or whatever, and it was a display of like a lifestyle choice that they made. And I think wearing an OURA ring is that it's a conversation piece. It's like I. I have this thing that is important to me. It's. You don't wear it typically on your wedding finger. So you see people wearing it on their. What is that, your forefinger or whatever. Even I noticed it in TV shows. Like Jennifer Anisted, I think was the morning show or whatever. And she wore one on the morning show. And I'm like, oh, she's got an order ring on. So I think it does. Like, if you can have a product for which people wear it with pride and the brand of it. The other example I would give you of a company we backed was Ring. You know, the security doorbell company. What they did that was super unique because obviously you don't walk around with your ring camera, but they built a unique sound on your phone and it was different than any other sound when someone went in front of your house. So when I'm at dinner and I hear that ring sound go off, I'm like, they got a fucking ring. And hats off to Jamie Siminoff for understanding that. And I have encouraged every company that has notifications to do that. Like have a unique signature or footprint that people feel pride in. That thing going off.

Exactly. That's good advice.

We're sitting here in 2024. The topic that everyone in the industry talks about is AI. So I really want to come at this from two perspectives. I first want to talk about, in what ways do you think AI will change how consumer companies or applications are built?

Well, first off, yes, we're all talking about AI. I'm actually really excited about Generative AI and all the new products and services that can be imagined and come to life. And it's always hype at the beginning because there's. I Think that moment of creativity where just lots of stuff's being thrown up, you know, being, being played with and tested and who knows how much of it is viable. But you kind of got to go through that phase to get to the, okay, this is actually going to work and this is going to be a real business. But if you, if you kind of step back and say like, I actually don't think that many of the premises change. I think maintain the basic premise of like, are you addressing a need? Are you going to offer a great experience and you know how to connect with your user on that. Right. And so I think that in that realm, like AI is like, does it make your product better? Can you leverage it to make your product and your experience better? Can you leverage it to make your product possible that wasn't possible before or wasn't economically viable before? All the other stuff, like what's going on with people, how are their needs change? Like that framework maintains and persists. It's just now that there's like a new tool in the toolkit or there's new advancement to maybe improve a product or bring new things to life.

Have you started to think about, and I don't think anyone has the answer to this, so I want to precious with that, but have you started to think about how consumers want to interact with technology differently because of AI?

Yeah, we have. It's super fun to start dreaming about that, right? And that's all anybody's doing is dreaming right now. We don't yet know, we haven't, we haven't seen it. But we've been doing a lot of primary research with users and, and obviously meeting a lot of companies and seeing a lot of like early adoption. And I think that the framework that we're working off of is kind of two dimensional, if you will. So it's like two main axis maybe. So one is do it with me or do it for me. And there's a spectrum of that. So you know, do you have the AI bring you along and learning something, doing something better, or does it just take it off your plate and do it and everything in between? Right. And then the other one is do it faster or do it better, do it higher quality. And if you think about plotting those on an X and Y axis, we're just exploring like, okay, where is the biggest pull coming from on that? And I think for different types of services or experiences, it's different, it lands in different spots on those quadrants. There's always a say, do gap with people. So I think You've got to kind of think practically about, like, what are people, what do people say? How are the actions mapping to it? What do you, you know, really believe it will land? A lot of it feels like the do it with me and do it higher quality is where people are focused right now. And maybe that's where we are on the adoption curve. But I think that in the context of that, like, greenfield opportunity, all right.

I might be the most important new technology well, ever.

We know that.

And it's storming every industry, literally billions of dollars invested. But the problem is AI needs a.

Lot of processing power.

It needs a lot of speed. So how do you compete without your.

Costs spiraling out of control?

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Twist I think about my own behavior and my own interaction with AI. Like everybody ChatGPT comes out and you play with it all the time and look at all the amazing things it could do. And then most of the individual use cases for me don't persist. They were kind of fun experiments or whatever. I have been more struck by perplexity. I don't know if you use perplexity, but I don't go to Google anymore. And I think it is really maybe Google will then catch up or deliver new products. But what I like about perplexity is usually if I go to Google and I do a search, they're putting up a bunch of ads in front of me. I think people call it 10 blue links or whatever. I think Brad often calls it that. Kirstner. So you get 10 blue links of ads in front of you. And even if I click on organic search, I might then go to a web page that I find out is really just gaming me as a customer acquisition tool for the real end product. So, like, there's so much work now that goes into finding information with perplexity. I asked the exact same question. I might want to know. It gives me the answer. And then it provides me links to relevant sites that I can click on just to double check that the answer is correct and not hallucinating. And I find that's changing my behavior of how I'm interacting with the technology.

I mean, that's a really prime example of like what I think is like the next era of real opportunity, which is we're just talking about it around our table as sort of the shift from access to edit. So for the last two decades, if you will, technology has been unlocking things. It's been opening up access to information. It's been opening up social network. It's been opening up the ability to get information at any time to buy products anywhere. It's really been more about creating accessibility. When we look deep into, like, what's going on with people and, you know, the nuances of how their behaviors are changing, we believe that, like what people really want now is some edit. It's too much. It's become overwhelming. That search experience that you described, it's not productive. It's actually not saving me time. It might be wasting my time.

Yep.

And people are like, you know what I want? I want something that is like, I give all this information to technology. Why can't it do a better job of personalizing? To me, personalization has been talked about for two decades. I think I've invested in plenty of companies where people have said this is. Personalization just hasn't. Hasn't delivered. If you go to Amazon today or I go to Amazon, they would probably go to the same page. I mean, it's just not. And, and so because it benefits Amazon, like sometimes, probably the business models have been grounded in that too. Right. So if you think about most of the, like, a lot of the companies have been built at a time when, you know, a decade ago and the landscape was different and that informed the business model that they have. And you get down the path of building a business and you've got to kind of work within the confines of that. Well, this is a step change what's possible now because Gen AI does make the possibility of personalization or it does make personalization actually possible. And I think that is going to create an entirely new expectation really from the consumer on what a great experience is. And it's going to, you know, I think that it's going to be part of a set of wow factors that bring new users into new products. And I think it's going to beg for reinvention of business model. Lots of change happening there.

I think people have forgotten just how disruptive mobile phones were. Meaning, you know, we had a way of interacting with the web before mobile existed and then mobile came and obviously it changed the screen size, it changed, it knew where I was, it had new behaviors. Like I walked down the street and I open Yelp and I want to know coffee places around me because I'm in a different place. So it had location. It could on healthcare as we talked about earlier, like I'm a huge user of Strava. I don't know if you've ever used Strava, but it could know the route that I ran or the route that I went biking. And so having mobility really changed how we interact with technology. And I think AI is going to do that or is already starting to do that because it changes, you know, the area I've been fascinated with for 30 years. I'm too old. Called HCI, which is human computer interfaces. Like how do we as humans interface with technology? And I think technology's become too overwhelming. And what AI has the ability to do is extract away a lot of the bullshit and get us quicker to what we want out of the technology.

Right. It's the next level of being context aware. Right. And the analogy of mobile is really relevant. Like what you described. Mobile made the idea, you know, the possibility of being location context aware made the experience magical or that much better, that much more useful. Now if you enter like really being personalization, like being all, all of the context that that is out there about people and, and into an experience like that's a whole new level of, of opportunity.

And I hope, and I will just say out loud what I'm most excited about is the hope that we finally can remove this barrier between us. And the answer which is a device or a screen and move towards more audio based commands, audio based interaction. Maybe it's getting closer to her. You know the movie Sam Altman had.

This, you know, we all probably did the same thing this week after the OpenAI and the Google announcements earlier this week, went home and played with these new, new tools, right. And I found myself that night or the evening after putting my daughter to bed, she's 10 and showing her having a chat GPT conversation. And we, I mean we stayed up too late because we got so into it. We were talking about everything from book reviews, like these are the books we're reading, but we're really not into it. How do we get into it? And you know, getting some advice on actually how to navigate and understand a character and process a book to Beauty product reviews to what's cool and sneakers to asking about news and what was more important. I mean, just on so many dimensions. And she was so. She was so delighted. It was amazing. I mean, we were giggling and. And having so much fun. And she said to me, mom, I don't even need any of the social. I don't even need YouTube. Just give me chat GPT. She was like, I'll bet. I mean, she was asking for. Like that. Because she's been asking for YouTube and everything. No. Right. But so she's like, I just want. I just watched. She was so excited. And I said, it's new. I don't know. No, I'm. We're not gonna talk about this tonight. Plus, it's past your bedtime. Let's go to bed. So when she rolled over five minutes later, she turns around and looks at me with a terrified look on her face and a tear streaming down her face and said, what if what that computer told us is not real?

Oh, good for her.

What if that's not real? How would we know? And then we thought. And then we thought, that's what. And she just. She went pretty quickly down the rabbit hole.

Is God real?

She didn't go that far, but let me tell you, she did. She didn't have a good notice. Good night of sleep. And this morning she came in and I was typing something on my computer in Chat GPT, asking a question. She goes, is that Chat GPT? And I said, she goes, oh, I'm scared of it. You know, so we've got work to do on this. I mean, we've got work to do. It's very exciting, and I'm very bullish on it and very positive about it, and I. I definitely want to put that forward to my daughter. But, like, we got to be careful how it gets executed.

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And we already know where all this is going. So when you're in a world where, like I always talk about Hillary, okay, the Hillary and Pizzagate. Through social media I could find conspiracy theorists who, let's call it QAnon, who collectively could come together and tell stories about how this pizza parlor in Washington, D.C. was being used as a pedophilia ring by Hillary Clinton, selling babies and for sex or whatever. And it's like absurdity, right? Like any rational person. So a relatively rational person, I will say, took a gun to Washington D.C. to this pizza parlor to rescue the children. And when you think about how being part of a tribe and hearing and getting things reinforced that are your ideas can lead you to action, into a belief system that on the face of it is absurd. Now you take an image that looks exactly like Hillary, a voice that sounds exactly like Hillary, a room that looks exactly like the pizza parlor. You put that online, you share it with people, you have conversation, people believe it. Like, think about that world. Like, we're going to have to be in a world where we need real identity and we need to be confident that something is real identity and the answer is a real answer. And I'll just say one last thing. Kirsten is also the model that these are trained on is susceptible to interference. So do you think if you ask in China, tell me about Tiananmen Square, you're going to get a real answer? Of course you're not. So the models that it's trained on are going to be trained to help with propaganda of what people who have large amounts of money and resource and invested interest want us to hear.

I know the edit that, the edit that we're excited about getting in the Face of being overwhelmed also has this downside. Who's doing the editing? What are the guardrails on the editing?

I want to ask you more about your great firm, Forerunner Ventures. I went to your website, it said something interesting I don't see on any other website for venture capitalists. Most of us have boring websites. And it said that you live at the intersection between invention and culture. How do you define, how do you think about what popular culture is?

So to make culture like for one minute, a little less sexy, but to make it a business conversation, we put it there because to us, like, culture is a driving, driving. It's a driving component of demand. Okay, Right. And ideally you're, you're building, you're inventing into the demand curve. Those are two things that we are always exploring, like where's the opportunity? As we're thinking particularly about early stage businesses, right? So trying to build into something new. So that makes culture like highly relevant. In the context of that, when people say culture, they generally think of pop culture. Right?

Okay.

Really culture is way more than that. And in the context of what we're doing here, it's more along the lines of how are people's needs changing, their preferences changing, their behaviors changing? So that really, that's driving the demand and the need. I think that, like, there's a lot of ways to get to a belief system around that or some ideas or learnings around it. I think it starts with being curious. You know, being curious, wanting to know the answers to those questions, being open minded about it, being flexible about how you kind of imagine what a signal today might mean tomorrow for, you know, a future action or behavior.

Can you give me an example in the last 10 years? So I'll give you a really wide net of a cultural shift that you've noticed in society and how something like that could become investable. I didn't prep you for this so you can punt it. I have an example, but I want to lead with you.

I mean, I love the question and we could probably play with this for an entire podcast. We, we actually already talked about this, Mark, when we talked about health. Right. It's been a cultural shift in how people view about health. It's still very much underway. It's not something that's like, I think the way everybody in our country talks about health, but I think that health has become wellness. And I think that the culture is moving towards taking responsibility for having your own healthy life, not waiting until you're sick and then being frustrated that somebody wasn't able to save you. And so that really is a cultural shift, which is driving, which is in the form of demand for new products and new services.

Are you a Millennial or Gen X? Are you cusp.

I'm.

I'm a Gen X.

Okay. Gen X. Thank you.

I'm a Gen X by birth date.

Thank you.

I'm a Gen X by birth date. But I'm like, maybe a Z. I don't know.

Yeah, yeah, yeah. You're way too cool for Gen X. But listen, I'm very clearly Jenna, and I want to talk about a cultural change as a way to kind of tee up a softball for you. Here's something I noticed when I grew up. If you went to a therapist and I didn't, I'm Gen X. And even if I did, I would pretend like I didn't. I told nobody.

Absolutely. When I first started going to a therapist 20 years ago, I told nobody. When someone's like, oh, your insurance will cover. I'm like, no way. I don't want my work to know that I'm going to a therapist. I mean, nobody.

I told my parents insurance did not cover it. No. Yeah, so. So I told nobody because I'm Jenna, but I didn't tell no one. I didn't go, I swear. Sorry for you, but no, of course I'm very open minded to it, but. But my generation wasn't. And now, like, I'll be talking to someone young in my office, let's say 28 years old, and I'll say, hey, Friday, 3:00pm, we have this meeting. Can you be there? And he or she will say, I can't. I'm really sorry. I have an appointment with my therapist. And I'm like, don't. You don't have to tell me. Like, I'm not. Like, that's HIPAA compliance. And they're like, no, it's okay. I go every other Friday. And I think that's a perfect example because it's become a cultural norm of acceptance and for great purpose. I mean, I'm really happy with it.

Yes.

That's an investable trend of a change that happened.

It's a great example. It's a specific example. And I think that it's like, you know, it's. It's almost gotten to be where it's like a badge of, like, I'm taking care of myself. I have a coach, I have a therapist.

Like, when I was in my 20s and 30s, you know, obviously, I sat in front of my TV, went and rented DVDs, put them in whatever. I love the big screen experience. I love surround sound. When my kids were little, I would put on a movie for them and they didn't want to watch it on a big screen tv. They wanted to bring out this fricking thing and sit and watch it. So examples, as they got a little bit older, you know, we liked watching Saturday Night Live together. And so I don't watch it on Saturday nights, I watch it on Sundays. I'm not, I'm not crazy. Inevitably we say, why don't you guys come watch Weekend Update with us or come watch Saturday Night Live and they'll watch it with us. And when it gets to Weekend Update, they've already seen it. I'm like, well, how have you already seen it? Oh, we watched it on Snapchat. Like the other obvious trend is. And I actually was lucky enough to spot this in 2006, 2007, 2008 was the shift away from big screen to small screen and the change in the kind of content that was being produced as a result. So I remember being with senior execs from Disney, from Fox, their mindset about YouTube was, yeah, YouTube, it's dogs on skateboards. And I'm like, guys, you gotta look beyond that. Like it's a new form of content. It's a new type of storytelling. People want an authentic relationship with a creator. They don't want professionally produced stuff. They want this. And it's gonna change how storytelling work. And everyone wrote me off from 2007 till like 2011, 2012. I made a lot of money on that thesis investing in initially maker studio.

I was going to say, there you are, you are a good consumer investor. Articulation of a big, of a big trend like that.

I have given up on it. But the recent trend that I noticed, Kirsten, when I go to buy a present for my children, especially my 18 year old, he doesn't want new stuff, he only wants used. And he goes to a private high school, he's about to graduate in L. A. All of his friends have some degree of money, like some degree. They're not like, I grew up with nothing and they don't want new. It's not cool. They, they, they go thrift shopping. I don't know if that's going to be a persistent trend, but I see it in my kids.

I mean I think that trend has, it's coming from two really strong places. One is just like style being more about individuality. I think back to. This is pretty far back but like two plus decades ago when the gap sort of dictated that Fridays was casual day and everybody wore khakis. I mean, that's what you did. Like people want the exact opposite of that now. They want their own individuality, they want their own look and feel. And with the way they put things together and because you can get anything in the click of a button or most things in the click of a button, this idea and this hunt for something that's a one of is on. It's on. And there's the idea that. And this is maybe less prevalent and maybe because it's earlier in the trend being becoming the norm, but there's a sustainability element to it too. There's a backlash against the waste.

My kids are driven by sustainability side to it. Yeah, I think in a good way, the social pressure to think about the sustainability side of it and then therefore it becomes cool to care about that.

But there's a lot of conflicts around that too right now. Right. Like there's genuine care when somebody says that. But then there's still a lot of shopping of like plastic things or things that are, I mean there's this like, there's this high prevalence towards wanting inexpensive things. And so like where, where you know, you know, they're kind of in conflict with each other a bit.

I hear you. I'm, you know, I was saying Shein. And people like that where they get super cheap stuff that's almost like wear it three times and throw it out because it's so cheap. And that is in conflict. Another debate in consumer which could be good advice both for investors and for founders, is this idea of direct revenue, and I want to say it this way, is the customer paying or are you monetizing in a different way either through ads or through selling data or even in the case of health care, sometimes the go to market strategy is insurance underwriting it to bend down their cost curves. How do you think about the importance of direct revenue and the mix between direct and indirect revenue?

So just having that conversation on a diligence call this morning. I do place a high value on a product being important enough to the user that they're willing to pay for it. I think people are voting with their time, but when they're voting with their dollars, it's just that much more powerful. And when you're on the path to building a business that has repeatability and it has stickiness in it, I think that is part of the signal and it's part of the challenge of what, what business leaders should challenge themselves is if I am, I Putting out something that's needed enough and loved enough that someone's willing to open up their, their wallet for it. I do also think though that like this is where consumer businesses have a chance to be even more interesting businesses because there's multiple ways, oftentimes there's multiple ways to monetize the business. And I do think that like thinking about, like, is there other dimensions that can add and to make business or the product better by monetizing other aspects of what we have. Data being one, you have a marketplace. Maybe one side pays for being in front of the consumer in a different way. Or you know, I think there's like other things to play with in the, in the context of assets that get built through a business, but the user paying matters. It's an indication of value. You know, even talking about just like, you know, something as imaginative of as pay up front. And over time, if you're using the product in a certain way, if you're kind of. And the business is able to create value in other ways that they can actually give credit back to the consumer where it can then sort of pay you back. Like that's very interesting.

Yeah. Do you think freemium still works? Like, do you ever look for freemium models? Are you averse to freemium models? And just to make sure all listeners know that premium model, the idea being you give a base away of your product for free and then your goal is to think of it as a funnel where you can convert a certain number of those people eventually to paid users as you restrict features from them that they really want and as they become addicted to your product, maybe think of it as, you know, you'll give away your first hit for free and then they become an addicted customer to. Does it still work or do you think that's an outdated idea?

I think it does still work. I think like everything, it's like a case by case basis. But I think there's definitely a role for it. And I think of it less about a signal as the person that the customer wants your product and more of a marketing funnel and bringing people kind of through a funnel of messages or prompts. And maybe that being like the one right before you're converting them to pay. But I think it can be a really effective way to bring people into your product, particularly if you are gaining something as a business in the context of it, if there's some, you know, advantage you're getting by having more users on the platform, that's either doing something to make your product better or forming.

The data better or it's a video game and therefore there's more people playing it. Tell me this. Another thing that makes VCs very uncomfortable is hardware. Or let's say atoms versus bits, which is 20 years ago. The debate. Atoms being physical products, some VCs are just absolutely allergic to them. Where do you stand on atoms versus bits or atoms plus bits?

Hardware is hard. You know, I mean, I'd love to say something novel here. And we already talked about Aura. We did. Aura. That's was a hardware product that was an exception. It was an exception because it fit so squarely into other trends that we felt so strongly about. And we could see and feel the product and there'd been de risked at least bringing they got a fucking ring.

And it's a ching, Right? And hats off to Jamie Siminoff for understanding that. And I have encouraged every company that has notifications to do that. Like have a unique signature or footprint that people feel pride in that thing going off.

Exactly. That's good advice.

We're sitting here in 2024. The topic that everyone in the industry talks about is AI. So I really want to come at this from two perspectives. I first want to talk about in what ways do you think AI will change how consumer companies or applications are built?

Well, first off, yes, we're all talking about AI. I'm actually really excited about generative AI and all the new products and services that can be imagined and come to life. And it's always hype at the beginning because there's, I think, that moment of creativity where just lots of stuff being thrown up, you know, being, being played with and tested and who knows how much of it is viable. But you kind of got to go through that phase to get to the, okay, this is actually going to work and this is going to be a real business. But if you, if you kind of step back and say, like, I actually don't think that many of the premises change. I think the maintain the basic premise of like, are you addressing a need? Are you going to offer a great experience and you know how to connect with your user on that? Right. And so I think that in that realm, like, AI is like, does it make your product better? Can you leverage it to make your product and your experience better? Can you leverage it to make your product possible that wasn't possible before or wasn't economically viable before? All the other stuff, like, what's going on with people? How are their needs changed? Like, that framework maintains and persists. It's just now that there's like a new tool in the toolkit or there's new advancement to maybe improve a product or bring new things to life.

Have you started to think about, and I don't think anyone has the answer to this, so I want to preface with that, but have you started to think about how consumers want to interact with technology differently because of AI?

Yeah, we have. It's super fun to start dreaming about that. Right. And that's all anybody's doing is dreaming right now. We don't yet know, we haven't really, we haven't seen it, but we've been doing a lot of primary research with users and obviously meeting a lot of companies and seeing a lot of early adoption. And I think that the framework that we're working off of is kind of two dimensional, if you will. So it's like two main axis, maybe? No, we haven't seen it, but we've been doing a lot of primary research with users and obviously. So one is do it with me or do it for me. And there's a spectrum of that. So, you know, do you have the AI bring you along in learning something, doing something better, meeting a lot of companies and seeing a lot of like early adoption? And I think that the framework that we're working off of is kind of two dimensional, if you will. So it's like two main axis maybe, or does it just take it off your plate and do it and everything in between? Right. And then the other one is do it faster or do it better, do it higher quality. And if you think about plotting those on an X and Y axis, we're just exploring like, okay, where is the biggest pull coming from on that? And I think for different types of services or experiences, it's different. It lands in different spots on those quadrants. There's always a say, do gap with people. So I think you've got to kind of think practically about like, what are people, what do people say? How are the actions mapping to it? What do you, you know, really believe it will land? A lot of it feels like the do it with me and do it higher quality is where people are focused right now. And maybe that's where we are on the adoption curve. But I think that in the context of that, like, greenfield opportunity, all right.

AI might be the most important new technology, well, ever.

So one is do it with me or do it for me. And there's a spectrum of that. So, you know, do you have the AI bring you along in learning something, doing something better?

We know that. And it's Storming every industry.

Literally billions of dollars are being invested. But the problem is AI needs a.

Lot of processing power.

It needs a lot of speed. So how do you compete without your.

Costs spiraling out of control?

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And.

Or does it just take it off your plate and do it and everything in between? Right. And then the other one is do it faster or do it better, do it higher quality. And if you think about plotting those on an X and Y axis, we're just.

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Twist I think about my own behavior and my own interaction with AI. Like everybody ChatGPT comes out and you play with it all the time and.

Just exploring like, okay, where is the biggest pull coming from?

Look at all the amazing things it could do. And then most of the individual use cases for me don't persist. They were kind of fun experiments on that.

And I think for different types of services or experiences, it's different, it lands in different spots on those quadrants there's always a say, do, gap with people, whatever.

I have been more struck by perplexity. I don't know if you use perplexity, but I don't go to Google anymore. And I think it is really maybe Google will then catch up or deliver new products. But what I like about perplexity is usually if I go to Google also.

I think you've got to kind of think practically about like, what are people, what do people say? How are the actions mapping to it?

And I do a search, they're putting up a bunch of ads in front of me. I think people call it 10 blue links or whatever. I think Brad often calls it that. Kirstner. So you get 10 blue links of ads in front of you. And even if I click on organic search, I might then go to a web page that I find out is really just gaming me as a customer acquisition tool for the real end product. So like, there's so much Work now that goes into finding information with perplexity. I asked the exact same question. I might want to know. It gives me the answer, what do.

You, you know, really believe it will land? A lot of it feels like the.

Do it with and then it provides me links to relevant sites that I can click on just to double check that the answer is correct and not hallucinating. And I find that's changing my behavior of how I'm interacting with the technology.

Me and do it. Higher quality is where people are focused right now. And maybe that's where we are on the adoption curve. But I think that in the context of that, like, greenfield opportunity, I mean, that's a really prime example of like, what I think is, like the next era of real opportunity, which is, all.

Right, AI might be the most important.

New technology, well, ever.

We're just talking about it around our table as sort of the shift from access to edit. So for the last two decades, if you will, technology has been unlocking things. It's been opening up access to information. It's been opening up social network. It's been opening up the ability to get information at any time to buy products anywhere. It's really been more about creating accessibility. When we look deep into, like, what's going on with people and, you know, the nuances of how their behaviors are changing, we believe that, like, what people really want now is some edit. It's too much. It's become overwhelming. That search experience that you described, it's not productive. It's actually not saving me time. It might be wasting my time. And people are like, you know what I want, I want.

We know that. And it's storming every industry.

Literally billions of dollars are being invested. But the problem is AI needs a.

Lot of processing power.

It needs a lot of speed. So how do you compete without your.

Costs spiraling out of control?

That's something that is like, I give all this information to technology. Why can't it do a better job of personalizing? To me, personalization has been talked about.

Well, it's time to upgrade to the next generation of cloud with Oracle Cloud Infrastructure, or oci, out for two decades.

I think I've invested in plenty of companies where people have said this is personalization just hasn't. Hasn't delivered. If you go to Amazon today or I go to Amazon day, we probably go to the same page.

OCI is a single platform for your infrastructure data.

I mean, it's just not because it.

Benefits Amazon, like sometimes probably the business.

Models have been grounded in that Too Right. So if you think about most of the like a lot of the companies have been built at a time when you know a decade ago and the landscape was different and that informed the business model that they have and you.

Get data based application development and all your AI needs and on the path.

Of building a business and you've got to kind of work within the confines of that. Well, this is a step change what's possible now because gen AI does make the possibility of personalization or it does make personalization actually possible. And I think that is going to.

Create an OCI has four to eight times the bandwidth of of other clouds.

Entirely new expectation really from the consumer on what a great experience is offering.

One consistent price instead of variable regional pricing. And of course nobody does data better than Oracle. So now you can train your AI models at twice the speed and at less than half the cost than other clouds.

And it's going to, you know, I think that it's going to be part of a set of wow factors that bring new users into new products and I think it's going to beg for reinvention of business model. Lots of change happening there.

I think people have forgotten just how disruptive mobile phones were. Meaning, you know we had a way of interacting with the web before mobile existed and then mobile came and obviously it changed the screen size, it changed. It knew where I was, it had new behaviors. Like I walked down the street and I open Yelp and I want to know coffee places around me because I'm in a different place.

So if you want to do more and spend less like Uber 8x8 and Databricks, take a free test drive of OCI.

So it had location it could on healthcare as we talked about earlier. Like I'm a huge user of Strava. I don't know if you've ever used Strava but it could know the route that I ran or the route@oracle.com twist.

That'S right oracle.com twist oracle.com twist that I went biking.

And so having mobility really changed how we interact with technology. And I think AI is going to do that or is already starting to do that because it changes I think about my own behavior and my own interaction with it. You know the area I've been fascinated with for 30 years, I'm too old called HCI which is human computer interfaces. Like how do we AI like everybody chatgpt comes out and you play with it all the time. And as humans interface with technology and I think technology's become too overwhelming and what AI has the ability to do is extract away a lot of the bullshit and get us quicker to what we want out of the technology.

Right. It's the next level of being context aware. Right. And the analogy of mobile is really relevant. Like what you described mobile look at.

All the amazing things it could do. And then most of the individual use cases for me don't persist. They were kind of fun experiments, made.

The idea, you know, the possibility of being location, context aware, whatever.

I have been more struck by perplexity.

I don't made the experience magical or that much better, that much more useful. Now if you enter like really being personalization, like being all of the context that I don't know if you use.

Perplexity but I don't go to Google anymore and I think it is really maybe Google will then catch up or deliver new products. But what I like about perplexity is usually if I go to Google is.

Out there about people and into an experience like that's a whole new level of opportunity.

And I hope and I will just say out loud what I'm most excited about is the hope that we finally can remove this barrier between us and the answer which is a device or a screen and move towards more audio based commands, audio based interaction. And I do a search. They're putting up a bunch of ads in front of me. I think people call it 10 blue links or whatever. Maybe it's getting closer to her, you know the movie Sam Altman or I think Brad often calls it that Kirstner. So you get 10 blue links of ads in front of you. And even if I click on organic.

Search, I had this, you know, we all probably did the same thing this week after the OpenAI and the Google announcements earlier this week. Went home and played with these new, new tools, right? And I found myself I might then.

Go to a web page that I find out is really just gaming me as a.

That night or the evening after putting my daughter to bed, she's 10 and.

Showing her customer acquisition tool for the real end product. So like there's so much work now that goes into finding information with perplexity. I asked the exact same question I might want to know. It gives me the answer and then it provides me links to relevant sites that I can click on.

Just having a chatgpt conversation. And we, I mean we stayed up too late because we got so into it. We were talking about everything, double check.

That the answer is correct and not hallucinating. And I find that's changing my behavior of How I'm interacting with the technology.

I mean, that's a really prime example of, like, what I think is, like, the next era of real opportunity, which is things from book reviews. Like, these are the books we're reading, but we're really not into it. How do we get into it? And, you know, getting some advice on actually how to navigate and understand a character and process a book to beauty product reviews, to what's cool in sneakers, to. We're just talking about it around our table as sort of the shift from access to edit. Asking about news and what was more important. I mean, just on so many dimensions. And she was so. She was so delighted. It was amazing. I mean, we were giggling and, And. And having so much fun. And she said to me, mom, I don't even need any of the social. I don't even need YouTube. Just give me chat GPT. She was like, I'll. I'll bet. I mean, she was asking for, like that because she's been asking for YouTube and everything, right? But so she's like, I just want. I just want chat GPT. She was so excited. And I said, well, it's new. I don't know. No. So for the last two decades, if you will, technology has been unlocking things. It's been opening up access. We're not gonna talk about this tonight. Plus, it's past your bedtime. Let's go to bed. So when she rolled over five minutes later, she turns around and looks at me with a terrified look on her face and a tear streaming down her face and said, what if? What? That computer is information. It's been opening up social network. It's been opening up the ability to get information at any time, to buy products anywhere. It's really been more about creating accessibility. When we look deep into, like, what's going on with people and, you know, the nuances of how their behaviors are changing, we believe told us is not real.

Oh, good for her.

What if that's not real? How would we know? And then we thought. And then we thought that's what. And she just. She went and then pretty quickly down the rabbit hole.

Is God real?

She didn't go that far, but let me tell you, she did, by the.

Way, my son did.

She didn't have a good notice, Good night of sleep. And this morning she came in that, like, what people really want now is edit is too much. It's become overwhelming. That search experience that you described, it's not productive. It's actually not saving me time. It might be wasting my Time, Yeah. And people are like, you know what I want, I want. And I was typing something on my computer in chat GPT, asking a question. She goes, is that chat GPT? And I said, because that's something that is like, I give all this information to technology. Why can't it do it? But scared of it, you know, so we've got work to do on this. I mean, we've got work to do. It's very exciting and I'm very bullish on it and very positive about it. And I, I definitely want to put that forward to my daughter. But like, we got to be careful how it gets executed.

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You get a better job of personalizing. To me, personalization has been talked about for two decades. I think I've invested in plenty of companies where people have said this is personalization just hasn't delivered. If you go to Amazon today or I go to Amazon day, we probably go to the same page. I mean it's just not. And so because it benefits Amazon like.

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Models have been grounded in that too. Right? So if you think about most of the like a lot of the companies have been built at a time when.

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So apply a minute a decade ago and the landscape was different and that informed the business model that they have. And you get, get down the path of building a business and you've got to kind of work within the confines of that. Well, this is a step change. What's possible now.

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And we already know where all this is going. So when you're in a world where like I always talk about Hillary, okay, the Hillary and Pizzagate, through social media I could find conspiracy theorists who let's call it QAnon, who collectively could come together and tell stories about how this pizza parlor in Washington D.C. was being used as a pedophilia ring by Hillary Clinton selling babies and for sex or whatever. And it's like absurdity, right? Like any rational person. So a relatively rational person, I will.

Say, because Gen AI does make the possibility of personalization or it does make personalization actually possible. And I think that is going to create an entirely new expectation really from the consumer on what a great experience is. And it's going to, you know, I think that it's going to be took.

A gun to Washington D.C. to this pizza parlor to rescue the children. And when you think about how being part of a tribe and hearing and getting things reinforced that are your ideas can lead you to action into a belief system that on the face of it is absurd. Now you take an image that looks exactly like Hillary, a voice that sounds exactly like Hillary, a room that looks exactly like the pizza parlor, you put that online, you share it with people, you have conversation, people believe it. Like think about that world. Like we're going to have to be in a world where we need real identity and we need to be confident that something is real identity and the answer is a real answer.

And I'll just part of a set of wow factors that bring new users into new products and I think it's going to beg for reinvention of business models. Lots of change happening there.

Say one last thing. Kirsten is also the model that these are trained on is susceptible. I think people have forgotten just how disruptive mobile phones were. Meaning, you know, we had a way of interacting with the web before mobile existed and then mobile came and obviously it changed the bolt to interference. So do you think if you ask in China, tell me about Tiananmen Square, you're going to get a real answer? Of course you're not. So the models that it's trained on are going to be trained to help with propaganda of what people who have large amounts of money and resource and invested interest want us to hear. The screen size, it changed. It knew where I was. It had new behaviors. Like I walked down the street and I open Yelp and I want to know coffee places around me because I'm in a different place.

I know the edit that, the edit that we're excited about. Getting in the face of being overwhelmed also has this downside. Who's doing the editing? What are the guardrails on the editing?

I want to ask you more about your great firm Forerunner Ventures. I went to your website, it said something interesting I don't see on any other website for venture capitalist place. So it had location it could on healthcare. As we talked about earlier. Like I'm a huge user of Strava. I don't know if you've ever used Strava, but it could know the route that I ran or the route. Most of us have boring websites and it said that you live at the intersection between invention and culture. How do you define, how do you think about what popular culture is that I went biking and so having mobility really changed how we interact with technology.

To make culture like for one minute a little less sexy. But to make it a business conversation, we put it there because to us.

Technology and I think AI is going to do that or is already starting to do that because it changes. You know, the area I've been fascinated with for 30 years, I'm too old. Called HCI.

Culture is a driving, It's a driving component of demand. Okay. Right. And ideally you're, you're building, you're inventing into the demand curve. Those are two things that we are always exploring.

Like, which is human computer interfaces. Like how do we.

Where's the opportunity? As we're thinking particularly about early stage businesses. Right. So you're trying to build into something new. So that makes culture like highly relevant. In the context of that when people say culture, they generally think of pop culture. Right.

Okay.

But really culture is way more than that. And in the context of what we're doing here, it's more along the lines of how are people's needs changing, their preferences changing, their behaviors changing so that really that's driving the demand and the.

Need as humans interface with technology. And I think technology's become too overwhelming.

And what I think that like there's a lot of ways to get to a belief system around that or some ideas or learnings around it. I think it starts with being curious.

AI has the ability to do is extract away a lot of the bullshit.

And get curious, you know, being curious, wanting to know the.

That is quicker to what we want out of the technology.

Answers to those questions, being open minded, it being flexible about how you kind of. Right. It's the next level of being context aware. Right. And the analogy of mobile is really relevant. Like what you described.

Mobile.

Imagine what a signal today might mean tomorrow for, you know, a future action or behavior.

Can you give me an example in the last 10 years. So I'll give you a really wide net of a cultural shift that you've noticed in society and how something like that could become investable. I didn't prep you for this so you can punt it. I have an example, but I want to lead with you.

I mean, I love the question and we can probably play with this for an entire podcast. We, we made the idea, you know, the, the possibility of being location context aware. Actually already talked about this Mark, when we talked about health. Right. It's been a cultural shift in how people view about health. It's still very much underway. It's not something that's like I, I think the way everybody in our country talks about health made the experience magical or that much more useful. Now if you enter like really being personalization, like be being all, all of the context that that is. But I think that health has become wellness and I think that the culture is moving towards taking responsibility for having your own healthy life is out there about people and into an experience like that's a whole new level of, of not waiting until you're sick and then being frustrated that somebody wasn't able to save you. And so that really is a cultural shift which is driving, which is in the form of demand for new products and new services.

Are you a millennial or Gen X? Are you cusp.

I'm. I'm a Gen X.

Okay. Gen X. Thank you.

I'm a Gen X by birthday. I'm a Gen X by birthday. But I'm like maybe a Z, but I don't know.

Yeah, yeah, yeah. You're way too cool for. And I hope, and I will just say out loud, what I'm most excited about is the hope that we finally can remove this barrier between us. And the answer, which is a divine Gen X. But listen, I'm very clearly Gen X and I want to talk about a cultural change as a way to kind of tee up a softball for you. Here's something I noticed when I grew up. If you went to a therapist and I didn't. I'm Gen X and even if I did I would pretend like I didn't. I saw a screen and move towards more audio based commands, audio based interaction. Told nobody.

Absolutely. When I first started going to a therapist 20 years ago, I told nobody.

When someone's like maybe it's getting closer to her. You know the movie Sam Altman oh.

Your insurance will cover. I'm like no way. I don't want my work to know that I'm going to a therapist. I mean nobody.

I told my parents most insurance did not cover it.

No.

Yeah, so, so I, I told nobody because I'm Jenna. But I, I didn't tell no one. I didn't go. You didn't really didn't, I swear. Sorry for you but no, of course I'm very open minded to it but. But my generation wasn't had this, you.

Know we all probably did the same thing this week after the open AI and the Google announcements earlier and now.

Like I'll be talking to someone young in my office.

Let's this week went home and played with these new, new tools, right? And I found myself they 28 years old.

And I'll say hey, Friday 3pm we have this meeting, can you be there? And he or she will say I can't, I'm really sorry. I have an appointment with my therapist. And I'm like don't, you don't have to tell me. Like I'm not like that's HIPAA compliance. And they're like no, it's okay. I go every other Friday. And I think that's a perfect example.

That night or the evening after putting my daughter to bed, she's 10 and showing her having a chat GPT conversation.

And example because it's become a cultural norm of acceptance and for great purpose. I mean I'm really happy with it. Yeah, that's an investable trend of a change that happened.

It's a great example. It's a specific example and I think that it's like we, I mean we stayed up too late because we got so into it. We were talking about everything. It's almost gotten to be where it's like a badge of like I'm taking care of myself. I have a coach, I have a therapist.

Like when I was in my 20s and 30s, you know, obviously I sat in front of my TV, went and.

Rented DVDs thing from book reviews. Like these are the books we're reading but we're really not into it. How do we get into it and.

Put Them in whatever. I love the big screen experience. I love surround sound. When my kids were little, I would put on a movie, you know, getting.

Some advice on actually how to navigate and understand a character and process a book, to beauty product reviews, to what's cool in sneakers, to.

For them. And they didn't want to watch it on a big screen tv. They wanted to bring out this fricking thing and sit and watch it. So examples, as they got a little bit older, you know, we liked watching Saturday Night Live together. And so I don't watch it on Saturday nights, I watch it on Sundays. I'm not, I'm not crazy.

Inevitably asking about news and what was more important. I mean, just on so many dimensions. And she was so, she was so delighted.

It was, hey, why don't you guys come watch Weekend Update with us? Or come watch Saturday Night Live and they'll watch it with us. And when it gets to Weekend Update, they've already seen it. I'm like, well, how have you already seen it? Oh, we watched it on Snapchat. Like the, the other obvious trend is. And I actually was lucky enough to spot this in 2006, 2007, 2008 was the shift away from big amazing.

I mean, we were giggling and, and, and having so much small screen and.

The change in the kind of fun.

And she said to me, mom, I don't even need any of the social. I don't even need YouTube. Just give me ChatGPT. She was like, I'll. I'll bet. I mean, she was asking for, like that because she's been asking for YouTube and everything.

Been like, no content that was being produced as results. So I remember being with senior execs from Disney, from Fox. Their mindset about YouTube was, yeah, YouTube, it's dogs on skateboards. And I'm like, guys, you gotta look beyond that. Like, it's a new form of content. It's a new type of storytelling. People want an authentic relationship with a creator. They don't want professionally produced stuff. They want this and it.

Right? But so she's like, I just want. I just watch GPT. She was so excited. And I said, well, it's new. I don't know.

No, it's gonna change how storytelling work. And everyone wrote me off from 2007, oh, I'm.

We're not gonna talk about this tonight. Plus, it's past your bedtime. Let's go to bed. So when she rolled over five minutes later, she turns around and looks at me.

So like, 2011, 2012, I made a lot of money on that thesis investing in initially Maker Studio.

I was going to say there you are, you are good. With a terrified look on her face and a tear streaming down her face and said what if what that computer told us is not real?

Oh good for her.

What if consumer investor is a good articulation of a big. Of a big trend like that.

I have given up on it but the recent trend that I noticed Kirsten when I go to buy a present for my children, especially my 18 year old old he doesn't want new stuff. He only wants used and he goes to a private high school. He's about to graduate in la. All of his friends have some degree of money like some degree. They're not like I grew up with.

Nothing that's not real. How would we know? And then we thought, and then we.

Thought that and they don't want new. It's not cool. They, they, they go thrift shopping. I don't know if that's going to be a persistent trend but I see it in my kids.

I mean I think that trend has. It's coming from two really strong places. One is just like that's what. And she just, she went pretty quickly.

Down the rabbit hole is God real?

She didn't go that style being more about individuality I think back to this is pretty far back but like two plus decades ago when the gap sort of dictated that Fridays was casual day and everybody wore khakis. I mean that's what you did. Like people want the exact opposite of that now they were far but let me tell you she did by the way she didn't have a good notice good night of sleep. And this morning she in and I was typing something on my computer in chat GPT asking a question she goes is that chatgpt? And I said she goes want their own individuality, they want their own look and feel and with the way they put things together and because you can get anything in the click of a button or most things in the click of a button this idea and this hunt for something that's a one of is on. It's on and there's the idea that and this is maybe less, less prevalent and maybe because it's earlier it's scared of it, you know. So we've got work to do on this. I mean we've got work to do. It's very exciting and the trend being becoming the norm but there's a sustainability element to it too. There's a backlash against the waist.

My kids are driven by sustainability side to it.

Yeah, I'm very bullish on it and very positive about it and I. I definitely want to put that forward to my daughter. But like we got to be careful.

How I think in a good way the social pressure to think about the sustainability of it and then therefore it becomes cool to care about that it gets executed.

Most startups have tight but there's a lot of conflicts around that too right now. Right. Like there's genuine runways so keeping your.

Finances in order is critical and we all know it can be really complicated. You got all these tools, you got.

Bill when care when somebody says that but then there's still a lot of shopping of like plastic things or things are. I mean there's this like there's this high prevalence towards wanting inexpensive things and so like where. Where you know, you know they're kind.

Of in conflict with the invoicing reimbursements and you have to run all your financial workflows and we all know these.

Things are all together a bit.

I hear you. I mean I was saying Shein and people like that where they get super cheap stuff that's almost like wear it three times and throw it out because it's so cheap cheap. And that is in conflict. Another debate in consumer which could be good advice both for investors and for.

Connected to your bank account but the tools you're using aren't integrated with each other. Luckily Mercury solves this by founders is.

This idea of direct revenue and I want to say it this way powering.

All of your workflows from the bank account. Having these workflows powered by banking lets.

You get is the customer paying or are you monetizing in a different way either through ads or through selling data.

Get more accurate visibility into all your money movements. For example rather than monitoring multiple tools.

Or even in the case of healthcare sometimes the go to market strategy is insurance underwriting it to bend down their cost curves. How do you think about the importance of direct revenue and the mix between direct and indirect revenue?

Check your bank account for a real time view of every outgoing payment and every incoming invoice. So you control how so I was.

Just having that conversation on a diligence call this morning. I do place a high value on a product being important enough to the user that they.