INBOUND 2017 Brian Halligan & Dharmesh Shah Keynote

All right, everyone, as we all know, Inbound is only a couple of days away, and it is our mission to stop Brian and Dharmesh from getting to that stage. Jerry, I sure as hell hope you have a better plan on stopping them this year, because last year was a complete failure.

I have something, or should I say someone, that will definitely get the job done. Okay, you can come in now. Her name is Jesapena. Little backstory for everyone. Jasapina is from the cold and misty mountains of Slavitalistan. Yeah, it's somewhere on a map. She was raised by a pair of traveling snake breeders, and some claim that she's been practicing witchcraft and sorcery for well over 100 years. My plan is to have Jasapina cast a spell on Brian and Dharmesh that will stop them from getting to inbound.

This better work, Jerry.

Oh, it'll work, Alexa. Excuse me. Dude, what the heck happened? Brian, we're puppets. Dude, you're a freaking puppet.

Dude, you're a freaking puppet.

Must have been those rascals over at Outbound Inc. Aw, hell no. We need to get to Inbound. Let's get out of here. We'll figure it out along the way. Oh, my God.

Oh, my God.

Oh, my God. People are freaking out. What are we gonna do? How the heck are we gonna drive this thing?

I'll take the wheel, you work the pedals.

Let's do this. Put your hands. Put your. Put your up.

Brian, how many times do I have to say this? You can't eat in my car. I end up smelling like Bugles for a whole month.

Sorry.

We've got to get our head straight here. What are we going to do?

Damn these puppet hands. Dharmesh, the stupid bone doesn't recognize belt. Growthbot. Hello, Brian. Remember that shaman I met when I was on sabbatical? I need you to get her on the line and put her through to meet asap. Okay, Please hold. Hello, Sherry. Share the shaman. Hello, Brian. You know, I read an interesting parable the other day that you might appreciate. When a fishmonger catches a. I don't have time for this, Sherry. I'm a puppet. I need you to get to Inbound so we can sort all this out. Sherry. Oh, man. Thank God you can make it.

Sherry, we can't go out looking like this. Everyone's going to freak out. Please tell me you can switch us back.

Sure.

Seriously? That's all you had to do?

Dharmesh. Whatever. Let's just get out there. Thanks, Sherry.

Anytime. Namaste.

Put Your hands up. Push your hands up. Push up. Push up. Put your hands up. Put your hands.

Brian's going to kick this off and then I'll be back in a little bit. Hello, everyone.

Nice to be human again.

It's hard out there for a puppet. Brian. Let's do this.

All right. Okay. I'm a lucky guy because I get to talk about my favorite topic today. The topic is how do you take a little small startup and turn it into a big growing scale up? I love this topic. My favorite topic, I don't know about you guys. I have a lot of friends starting companies these days. Software companies and they're starting hardware companies. They're starting professional services companies. All these companies, they have three things in common, right? Organic, artisanal and farm to table. Everyone's starting a company. And I thought, well, it's expensive to start a company. And I went back and looked. How much did it cost HubSpot to get started back in 2006? $200,000 in startup fees. And I said, well, what's it going to cost one of these companies today to get started? About $1,000 in startup fees. Everything's cheaper. It's so much cheaper to start a company. Every is cheaper except that one. Magic startup. Coffee doesn't come cheap. It's organic artisanal, farm to table stuff is expensive. Since the caveman entrepreneurs started companies back in the neolithic age, it's never been a better time to start a company. Certainly never been cheaper. Everything's cheaper. The Internet gives you all these services. Very inexpensive. Just a wonderful time to start a company. Now I've seen this play out in spades at HubSpot and in my own world. Basically we started HubSpot, we had about 30 competitors. If you very broadly counting 30 competitors for our to get customers. Small industry in 2006, you roll that clock forward to today. There's over 5,000 competitors fighting for the same dollars we are. There's been an explosion in entrepreneurship in our industry. It's never been easier to start. But the flip side of that, it's never been harder to scale since the cavemen were starting companies. It hasn't been harder to grow from startup to scale up. Now you might say that's the software industry. I'm not in the software industry. I make real stuff for a living. I'm in the Adams business. And one of my friends said that I have a friend who's starting a really interesting business. She's in the high end children's potty business. She doesn't just want to be a potty preneur, though. She wants to grow up someday and be a tiny toilet titan when she grows up. Right? And it's easy to become a potipreneur. In fact, there are 75,000 potipreneurs who have beat her to the punch. Every corner of every market seems to be crowded. It's hard to scale. Headwinds are everywhere. Tight labor markets, lots of competition. Harder than ever to scale. Okay, I really like this graph. Okay, sorry, I fell behind. I really like this graph. Sorry. Take a little drink. And I mostly like this graph because I put it together and it represents that journey, that perilous journey from early stage startup up to big scale up. And phase one is kind of the founding phase. You know, you get three people, two, three people working on the idea. Phase two is the startup phase. Between three and 30 people, you're working on product market fit. You know, all your customers. Most of your customers are either your cousins or your childhood friends or your friends from bandcamp. You're trying to get the thing going. Phase three, well, that's the scale up phase. You got more than 30 employees. You've got many millions of dollars in revenue growing fast. You pour money into the top of the funnel, you get a nice return out the bottom of the funnel. I just want to take a measure of the audience. Who in the room is in that kind of phase one, that founding stage? Three employees or less. Can you clap for me? Okay, between three and 30 employees, you haven't quite got the model scaling yet. Who's in phase two? Okay, who's in phase three? They're really cranking. They got the model going, and they're pouring money in the top. Great. Okay, there's a little bit of bad news in this slide. For every hundred companies that start in phase one, only about five make it to phase three. Starting is pretty easy. Scaling's getting harder than ever now. What I want to talk about today is my own journey. My own journey through this curve, basically. At HubSpot, we breezed through phase one about a year to get through phase one. We got stuck in phase two, five, six years. Couldn't get the math to work. We're pouring money into the top of the funnel. Couldn't get the return. We knew all our customers. Our best reference customer back here when we had 18 employers. Our best reference customers right over here. Kirsten Dharmesh's wife. Thank you, Kirsten. And so this is us stuck in phase two. 18 employees early on. Now, we eventually figured it Out. And now we're at about 1800 employees. The model's working quite well. And what I want to talk about today is everything we learned, all the mistakes we made along the way to get there. Okay. And I can summarize the things we needed to know back at 18 employees. That would have been useful and would have helped us breeze through the startup phase to scale up phase in three important muscle groups. And I like to call them muscle groups. There's really no silver bullet, but there's three muscle groups we sort of built up in phase two that helped us get to phase three. They were a little counterintuitive. They were a lot of work. Okay, so I'm going to go through the three. The first muscle group is around hiring. Sorry, first I just said. Did I say hiring on that? The first muscle group. Let's try that again. First muscle group is around scaling your management. So scaling management. A lot of the things we learned to do as managers in startup mode worked against us in scale up mode. We had to learn a whole new bag of tricks. And anytime I talk about scale up management and best practices in management, I gotta talk about my dog Romeo. This is Romeo. He's having a great time with his favorite chicken. He loves his toy chicken. Toy chicken's not having a great time. Here's Romeo at the toy chicken store. And here's how the conversation always goes. Romeo says, yo, Brian, I could use another chicken here. Rome, how many chickens you need, Brian? I'm jonesing for some chickens here. And every time you know I'm weak, we have this conversation and my answer is the same every time I say yes. My predilection for saying yes and being a yes man happens at home. It happened at HubSpot in the startup phase. Okay? I was a yes man. I prided myself on being a yes man. I didn't care what the question was. The answer was yes. And they were getting a little bigger. And I got some feedback from a woman named Lori Norrington. She's a fabulous board member of ours. And she said this yes man thing worked great in startup mode, but man, it's backfiring. In scale up mode, we get projects, half baked projects all over the place. You need to amend your yes man ways. And then she gave me a great expression. I love this expression. She said, startups are much more likely to die of overeating than starvation. Too many projects, not enough. And she said, you have a serious overeating problem. And so I went to work on this. Feedbacks. The breakfast of champions. And I listened very carefully to her and I went on a yes man diet. And I had to learn an important new word. And I struggled with the word, can never remember the darn word. I came up with a little hack that really helped. And if you have the yes man problem, maybe you could borrow this then. Laundry day. The diet wasn't enough. The diet wasn't enough. I needed an exercise routine to really help me reform my yes man ways. And the exercise routine was a document we put together called our M spot. And this has been a killer, killer thing for us. The M stands for mission. S are the people we serve. The P are the plays we're going to run this year. The O are the plays we're going to omit this year. The T are how we're going to track how we're doing on this stuff. And this is a document we put together and publish internally the first week of January every year. It's a really key play for us. Almost every scale up I've encountered has a similar document to this that keeps everybody on the same page. Now, the key, the hard part of the play, the muscle you need to develop, is on the O. We argue like crazy about those omissions every year, and this past year was no exception. These were the omissions we decided to pass on in 2017. I like that one. Okay, so the first muscle group is you learn to focus, you gotta learn to do less things well. Okay. The second management muscle we needed to develop really was a problem that started emerging as we grew larger. When we were small, 10 people, we were all in the same office. We saw each other every day. As we got bigger, we had a layer of management in place. We had people working from home in remote offices and whatnot. And what started to happen that causes a lot of problems in scale ups is people. Managers started to make decisions that optimized for their department, over the company, over the company. And this was happening a lot. They didn't do it maliciously, of course, but this became sort of a normal thing. So we put in place a muscle that we call HubSpot's hierarchy of needs. And what we want our managers to do and everyone to do in HubSpot is when they're making a decision to solve for the company over their department. And even better is if they can solve for the customer over the company, over their department, over themselves. This was a muscle group that was really important to us. So to summarize, if I could go back in time to when we had 18 employees. The advice I wish I got was, gee, everyone's got to learn to say no from the front line on. Two, you need some way to keep everyone aligned on the plays you're running and the plays you're omitting. Three, you need to solve for your company over the department. That's what I wish I learned when we were at et. Employees. Okay. Second muscle group, Billie Jean. Second muscle group is around hiring. Okay. And this sounds like an easy muscle group and it's an easy idea, but it's actually very hard to do at scale. And we learned a lot of things about hiring that didn't work in startup mode that really enabled things to happen in scale up mode. Now, when we first started HubSpot, the word culture wasn't one we encouraged discussion about. We didn't talk a lot about culture. We didn't think we could measure it. It felt like a luxury we just couldn't afford. Right. And that was until we met this guy. And this is Colin Engel. He's the CEO of iRobot and Colin's company. They make those Roomba vacuum cleaners. Right. And I could summarize my relationship with Colin in one word. Man crush. And I joined a CEO group right around. We were 18 employees and there were 10 CEOs in the group. I joined it because he was one of them. And they spent a whole day, once a quarter together and they picked a topic and went very deep on the topic. And I joined my first meeting kind of nervous. Joined my first meeting and the topic was culture, which was disappointing because I didn't have a lot to say. The one topic I didn't have a lot to say about. And we go through the meeting. I didn't have a lot to say and the meeting was going fine. And during the coffee break in the afternoon, Colin kind of took me aside and he said, Brian, you want to build a great company, right? Sure. He said, if you want to build a great company, you're going to have to hire lots of people, right? Yeah. If you're going to hire a lot of people, you're going to need a great culture. I'm like, okay. He said, culture. Culture is the magic startup ingredient. And I said, hold on one minute. Coffee is the magic startup ingredient. Okay. So I went back to the office and had a chat with it, chat with Dharmesh about this. And we said, let's do a little research. We're both fans of Colin. Colin had a big scale up. We wanted to be like him when we grew up. And let's do a net promoter score type survey of our employees. And this is the first one we've done. We've done 100 sits. And the results came back and the results were interesting. The number two reason that people liked working at HubSpot was they loved the culture. Right? They thought the culture was great and they wanted to talk about the culture. The number one reason they loved working at HubSpot was the free organic Bugles of the Bugles. Okay, so two data points. Employees really liked the culture. Colin thought we should do it. So we got to work on our culture. And Dharmesh and I did some work thinking about the culture, understanding what the culture was that we had, thinking about the future of it. And we wrote it down. We wrote it down. I go we. Because Dharmesh did all the work on this, and we wrote it down in something we called the culture code. And we call it a code, by the way, because we think of it like a piece of software. We take a piece out, we refactor it, we put it back in. It grows and scales and changes over time as the amount of employees join the company. And it's a lot like a product in another way. If you build a great product in your company and it's unique relative to your competition and it's valuable to your customers, gosh, that product's like a magnet that pulls customers in. If you build a great culture, it's unique relative to your competition and it's valuable to your employees. That's like a magnet that pulls in and retains those employees. Okay, if you've come across our culture code, you've read it, flipped through it. Can you clap for me? Okay. A lot of people have come across it. Colin was largely right about this. We published the culture code and savvy over 3 million views on SlideShare. And it's been a key, key part of that end to end employee experience for all the HubSpot employees. So the first muscle in the hiring muscle group is you need a great culture and you need to write it down. The second muscle, I have to describe a little bit of how we collaborated HubSpot to describe this one. We have a section of our wiki at HubSpot where we collaborate, and it's called the lore and mythology part of our wiki. And it's a part of our wiki where anyone can write anything down that we might want to look at later or maybe even laugh at later. And it's a really fun part of our wiki. And this is I'll give you an example of a post. This is a wiki post that someone put up there in the lore of mythology. We had an outage in 2007 and Dharmesh really pinpointed the scientific reason behind the outage and somebody wrote down his analysis, pinpoint analysis of it. And then I had this beauty that someone wrote down about a month later. Now I want to introduce you. We have 1800 employees. She may be our best employee. Her name is Katie Burke. She's our chief people officer. Okay. Now there's a story behind Katie that's interesting. Katie's a career marketer. Katie joined HubSpot's marketing department, stayed in the marketing department, and at the time, we had kind of a voice of the customer guy named Jonah. If Jonah was in the room, we didn't need a customer in the room. He understood. The customer, spoke passionately on their behalf. Katie, despite being in marketing, was the voice of the employees, spoke passionately about the employees. Now what Katie's superpower is and she moved eventually into HR and ran people ops. She does a great job on hiring and she does a great job on benefits and all that stuff. But what her superpower is, she's passionate about not making HubSpot a good place to work, but making it a great place to work. Even trying to make us the best place, place to work in the world, you need someone like this, this voice of the customer passionate about making your company a great place to work if you want to move from scale up to startup.

Okay.

Last one in this muscle group, mission. This is the one muscle we had right from the start. If your mission today is you want to make 3 cents a share more than last year by gouging the planet or gouging your employees or customers, that just doesn't fly in 2017. The employees we want to hire, the employees you all want to hire. Those special snowflakes. They're more missionary than mercenary, right? You need to appeal to them. Mission matters now at HubSpot. When we started the company, the thesis was quite simple. We felt the Internet disproportionately benefited small businesses relative to large. And that your success was more about the width of your brain than the width of your wallet. Every investor we met along the way from day one of HubSpot tried to talk us out of our mission. Said, it'll never work. Right. These small, medium sized businesses are growing. You can never make it work, right? Never make it work. You need to go to the Fortune 500, build a product for the Fortune 500. What they failed to understand was that mission mattered to Dharmesh and me, mission mattered a lot. Eleven years in, I'm up here working my guts out because I believe in that mission. Dharmesh, the same. We'll be up here 11 years from now working our guts out because we believe in the mission. I, I suspect our 1800 employees, they come to work every day because they believe in that mission. Mission matters. In fact, I'm going to give a quote from Simon Sinek, one of our speakers a couple years ago. He said, if people are working hard in a mission they believe in, they call that passion. If people are working hard in a mission they don't believe in, they call that stress. Mission matters. Mission matters more in 2017 than it ever has. Okay, so what are those hiring muscles you need to scale to go from startup to scale. What did I wish I knew when we had 18 employees that I know today? First, you need a culture. You need a good culture, unique culture. You need to write it down. Second, you need a voice of the employee. Maybe that's you inside your company. Doesn't have to be an hr. HR is necessary, but not sufficient to go from startup to scale up. Three, mission matters. You need a great mission that's compelling. Okay, most of you in the room are doing a fabulous job at building an inbound customer funnel, right? Pulling customers in through the Internet. To go from startup to scale up, you need to build an inbound recruiting funnel. It's the same type thing. So nothing up here on the screen. I didn't mention LinkedIn or job boards or recruiters. You need all that, but it's not going to get you there. To go from startup to scale up, you need to master these place. Okay, one last muscle group. This is the one that held us back. This is the one. This is how we got stuck in phase two. It took us a long time to figure this out, and I'll tell you why. One of the things that's good and bad about Dharmesh and I is we read everything about startups. We're steeped in the latest startup thinking. We're fascinated in it. We read all the startup dogma and we buy it. And so these words that you see on the screen, when we were in phase one founding stage, we must have said minimum viable product 1,000 times a week. When we got to phase two, we hung our hats on product market fit. All we talked about was product market fit. But that startup dogma held us back to getting to scale up mode. You don't need product market fit to get to scale up mode. You need product market delight to get to scale up mode. And it's very different. Delighted customers, well, they do two things, don't they? The first thing they do is they pay you course. The second thing they do is they market for you. And in 2017, your delighted customers are a better marketing channel than on your own marketing department. That's the way you grow. That's the fuel in the scale up rocket ship. In this day and age, it took us a long time to figure this out. Took us a long time to go from startup to scale up. We started investing heavily in R and D, heavily in net promoter score improvements, heavily in retention rate improvements. This has made all the difference for HubSpot. This was the key play that helped us go from startup to scale up. And I personally probably shouldn't be too surprised given my history in my first job I ever had, my first job I ever had, I was 16 years old and I worked in a gas station. And I want to tell you about my first day on the job. It was my first day on the job and my first customer, seven in the morning, beautiful day and Cadillac pulls up to get their gas. And I'm a gas pump guy at my first job and I'm 16 and the woman rolls her window down. You had to roll it down back then. I said how can I help you ma'? Am? And she said, well, fill it up with unleaded. I said sure. So I walked down the side of the car, I'm looking for the gas, where to put the gas in. I didn't see it back car.

On.

The other side of the car and quite see it there. Take another look. I must have missed the gas cap on the first time through. There's no gas cap on a Cadillac. Apparently I can't find the darn gas cap. And so the woman, this is my first customer having a little trouble with the lighting. My first customer here, woman gets out of the car, she's a little irritated with me and she goes and she pulls down the license plate and sure enough, that's where the darn gas cap is on a Cadillac. Don't judge me. Short shorts were in back then. Okay, so off to a rough start. But unscrew the gas cap, right? Put it on top of the thing and take the hose out and I put it in and go, go, go, go, go, go, go, go go. Fill up the thing, get the thing out, put it in the thing. I take her money and she's off. Second customer comes up, car pulls up. Gentlemen, how can I help you? Sir? Please fill it up with unleaded. Okay, walk down the side of the car. Gas thingy's where it's supposed to be. Right on the side of the car. Unscrew the gas cap and I put it on top of the thingy. Hose out and I put it in the thing, Put it back in the thing. It's off on its way. I got this, right? I'm a customer. Delicious machine, right? I got this. And then about an hour in, I served a bunch of customers. My boss comes out, he's busy and he comes out and he takes a customer gentleman and pulls down the window. How can I help you, sir? And fill it up and unlead it. And he goes. And the gas caps where it's supposed to be. Unscrews the thing and then he goes to put it on top of the who's ma jiggy. And he realized that his new hire had forgotten a key step in the customer delight process. I'd like to think I did my own part in helping the gas station industry convert from a full service industry to a self service industry. Okay, all right. I'm impressed with the gas station industry for what it's worth. They disrupted themselves, they transform their customer experience and it's much lighter touch. It smells a little bit, but it's pretty good. Most industries aren't so forward looking, are they? Here's a couple that are in the news a lot. Right. What I want to do with you all today is talk about these disruptions that happen and see if we can learn together something about them. Let's start with the disruptees, the industries that have been turned inside out. There's a line of thinking these days that these companies weren't disrupted, but they self destructed. And that Netflix didn't disrupt Blockbuster, their late fees did that. Apple didn't disrupt the music industry. Buying the whole album did that. Uber, they didn't disrupt the taxi industry. Waiting outside and the rain did. What they all have in common is they opened the door wide for the disruptors to come in by creating kind of a crappy end to end customer experience that was very heavy. Okay, there's a lot to be learned from these guys. What about the flip side? What about the disruptors? Is there anything we can learn from the disruptors? I think there's three things. Three things I learned. The first is it's much more about how they sell than what they sell. It's how they sell not what they sell. Great products these days seem to be disrupted very, very quickly. Great services, end to end experiences are far more durable. Disruption cycles are fast. Much more durable with great experiences. 2. Light touch in automation wins out over heavy touch in humans. I don't love that fact, but it's kind of true. Self service is one of those double win things. It's better for your bottom line and your customers like self service too. 3. The words coming out of the customer's mouths are 10 times more valuable than the words coming out of the vendor's mouths. They have mastered word of mouth. These are three things that we're working on here at HubSpot. So our own model at HubSpot, you've seen us evolve over the last few years. Here at Inbound, we've moved to very much a freemium model. Clap if you've used one of our free products. Yeah, we're, we're trying to move. We're kind of trying to move, I think of back in 2013. We got religion on a delightful product. We're trying to move to a delightful end to end process. We think that that's really a key thing. So the freemium is designed to do that. We sell in a whole different way. It's about how we sell very light touch and it's designed to be word of mouth. So this is very influential on us. The other thing we're doing with this is we're changing the product we're bringing to market to all of you. If I think back in time, why we started HubSpot in 2006, it was like a wormhole opened up on the Internet. That was a fabulous thing that if you were a small or medium sized business, you could create content and pull people in through Google and social media. It was fabulous. Right? And we built a platform to help people drive through that wormhole. That wormhole's still there. It's a bit smaller. By the way, the new wormhole today is creating one of these delightful inbound, end to end customer experiences. It's much more today about what you sell. Sorry. It's much more today about how you sell than what you sell. Your marketing sales service departments have never been more important than they are today. Okay, so what are the three muscles in the muscle group? First, it's about how you sell more than what you sell. Second, it's light touch over heavy touch. Third, it's not 2007 anymore. It's word of mouth over word of seller. Okay, I want to wrap up with a short story about this guy, that's my son Luke. Luke's 13. But far more importantly, Luke is five, two and three quarters. And I know that because just backstage he texted me. He texts me every day with an update on his site. You see, Luke is in phase two, trying to get to phase three, like all of us. Okay, here's Luke doing the back to back thing with my mom. You remember my mom from inbound last year. Here's Luke doing the back to back thing with my sister Diane. I can hear my mother laughing over here doing the back to back thing with my sister Diane. And you know, his mouth's open, he's really pissed off because Di Di's still got him by about a half an inch. Right. And I was heading down to. On the weekends, we go to Dunkin Donuts. It's our thing. And I go to Dunkin Donuts. I get a large hot coffee with milk and Luke always gets a small latte. And we're in line waiting in the Dunkin Donuts. Your usual? He said, no, no, no, no, no. I'd like an apple juice. I said, apple juice? What's the matter? He said, coffee. Stunning. And I said, that's funny, because I always thought coffee was the secret ingredient. Anyway, I think we all have a lot to learn from Luke. We started HubSpot to help all of you go from startup to scale up. We give away content. We have this conference to arm you with the knowledge you need to do it. We build the platform to help you grow your business. I want to thank you all for coming. Dharmesh is going to be out after a short video. Thank you very much.

So Brian talked about how to position yourself for growth, how to get culture right, how to get decision making right. What I'd like to talk about is how you produce growth. How do we grow better? Now, every now and then in your life, you get this email that causes a range of emotions. This is one of those emails. This came from Sequoia Capital, one of HubSpot's venture capital investors, and they were inviting Brian and I to a founders event. Now I'm going to walk you through the thoughts that went through my head as I read this email. Number one, buried deep in the hills. Now, this was my first hint that there might not be optimal WI fi where they were having this. And that was a problem for me because I'm what you would call indoorsy. It's not that I'm anti nature. I'm just pro Netflix and pro pajamas. Right? That's just problem number two, we're hosting a small N100 gathering. Now, I like the N100 part, the fact that he said it that way because that appeals to the geeky side of me. But in addition to being geeky, I'm also introverted. And N100 is about N98 more than the number of humans I'm used to being around. That's just not my thing. Final problem, we're bringing together our most legendary founders. Now, I can understand why they would want to bring together legendary founders. If I were them, I would do the same thing. My issue was then why do they also feel compelled to invite me? Like, you know, it's because legendary is not on the list of descriptors I would use for myself. The one that I would use is insecure. And so if you add it all up, I'm indoorsy, I'm introverted, I'm insecure. Net result, I'm intimidated. And so I send a message back. I'm polite about it, honored to be invited. Thank you so much for inviting me. Sorry I can't make it. And that was that. Or so I thought. Two weeks later, two weeks later, I get a follow up. Oh, and by the way, Elon Musk is going to be there. Now, I can characterize my feelings about Elon in one hyphenated geek crush. Geek crush. But the thought that went through my head as I was reading this email was one word.

Crap.

Now I'm going to have to come up with better excuses not to go on this outdoorsy thing. I'm still not going to go, but now I need better reasons. Now, as big a fan of Elon as I am, I know someone that's an even bigger fan. My son Sohan, who's in the audience today by the way, for the first time. Hey, guy. So Sohan is six and three quarter years old. I know this because every week he gives me an update and tells me exactly how old he is. Sohan's two favorite things in the world are space and cars. So you can imagine why he would be a huge Elon Musk fan. He's seen every launch video, he's used a lot of percentage of his screen time on Elon, and I have a suspicion if there was such a thing as reverse adoption, he'd trade me in for Elon.

Musk.

So I chat with my wife about my dilemma. She's outdoorsy and she's an extrovert. We've been together for 20 plus years. Thank you. Yeah, she's been to every inbound and she gets me, and I explain all the reasons why I'm not going. And she says, someone would really love that selfie with Elon. And I'm like, good talk, good talk. So here I am at the Founders event, and this photo was taken with a drone, because why wouldn't you take a photo with a drone if you can? And Elon did make it. That's Elon in the aviator glasses. It's hard to tell from this photo. He looks astonishingly like the Terminator. He's not, don't get me wrong. But he looks astonishing like the Terminator. He's more like an Iron man thing. Anyway, so that's me. I'm easy to spot in this photo because I'm the one person that's looking at the ground. And the reason I'm looking at the ground is because I'm an introvert and I don't like making eye contact, not even with a drone. That's just not what I do. And so I'm a man with a Grandmaster plan here at this event. So we're going to shift to this big tent, and we're going to have dinner. And here was my plan. I was like, okay, I'm going to sit myself at dinner. I'm going to pick a strategic spot. Then sometime during the course of dinner, I'm going to turn around, I'm going to take a selfie of myself. All selfies are of yourself. I'm going to take a selfie, and Elon's going to be somewhere in the background, and I'm going to let the magic of Photoshop do the rest. That's my Grandmaster. It's like he's six and three quarters. When he figures it out, he'll understand. Like, daddy, I would do the same thing. It's like, yeah, he'd be understanding about it. My suspicion. So this is the plan. So I'm sitting there waiting for dinner. I'm kind of channeling my inner Jason Bourne, checking out all the angles, waiting, waiting, waiting. Someone sits down kind of right next to me. I'm like, oh, that cuts out some of the angles. But turns out the person that sat down right next to me is Elon Musk. What are the odds, right? Well, actually, I guess 1 in 100 is anyway, but doesn't matter. It doesn't matter. Not important to the story. Okay, so first, just, like, awesome, Elon Musk is right there. And then I'm like, not awesome, because it is impossible to take a selfie with somebody that's sitting Right next to you without them noticing. Like it's just science, right? You can't do it, right? So I'm stressed out now. The good news is Elon was everything I had hoped he would be. Crazy smart and brilliant. Super geeky and as it turns out, very gracious and very charming. So I got to spend two and a half hours at a small dinner with Elon Musk. Had a great time, didn't go to bathroom for two and a half hours. Different story. So we're chatting, we're chatting, having a good time. And during the course of the evening, this question is posed. Like, Elon, you're doing like Tesla and SpaceX, like how do you do such big things? Like, what's your advice? Now? You have to realize Elon is a physics guy. Here's his answer. Let's say you're trying to get your company from point A to point B. Every person on the team is a vector, and your progress as a company is determined by the sum of all vectors. That's all he said. So I did what anyone would do. I nodded politely and started talking about artificial intelligence. So it's 2:30 in the morning, there's no wi fi, just so you know. And I was pondering vectors and I did the unimaginable, something I hadn't done in years, which is actually like exercise thought without the aid of Google. I didn't even know that was still possible these days, to actually think without having Google right there for you. And here's what I piece together around what Elon was talking about. First off, a vector is a quantity having both magnitude and direction. So let's say you have a hypothetical company and you have a person in this company, and let's say they have an impact score of 9 out of 10. They're super clueful, they're committed, they're competent, they're good 9 out of 10 on this arbitrary scale. Now this in of itself is not a vector because we don't know what direction this person is moving in. This is what's known as a scalar, just the magnitude, okay? Now if we know this person is moving in the right direction, now all of a sudden it's a vector represented by an arrow. Let's say you had four people in the company and they were all 9 out of 10s because you've been hiring well, you've got a good culture. Let's say you have these four people and let's say this is how we represent how they're working. Two people are pulling in One direction. Two people are pulling in the opposite direction. The algebraic sum of these four vectors, this is what Elon is talking about, is what's known as the null vector. It has zero magnitude and unknown direction. Nothing is being accomplished. Now, this is not common. This would not happen in any company ever, right? This is more common. Right. Mostly people are pulling in the correct ish direction, except for that one guy. There's always that one guy. We know that one guy. Right? There's always one of them. But overall, things are moving in the right direction. But it's still not optimal.

Right?

Because we're not maximizing the value of those impacts. If you did this kind of algebraically, you'd calculate how much actual impact was being had. I'm going to spare you that. Now, this is what Elon suggests we should be trying to do. This is the theoretical maximum for those 9 out of 10 people. Add them all up and the magnitude of impact is actually 36. Nothing is being wasted. There's no inefficiency. There's no one pulling in the wrong direction. This is what we should be all striving for, which is aligned vectors. So, congratulations. You've just passed a micro class on linear algebra. I'm not saying it was the best class on linear algebra, but it's the biggest live class on linear algebra, I think, ever. Now, some of you are wondering, Dharmesh, that's all well and good. Why would you give us a micro class on linear algebra?

Two reasons.

Reason number one, HubSpot's about 11.