Designing for Hyper-Growth with Elad Gil, Startup Helper

A lot of the early core metrics to get to your original question that were going to be things like for a SaaS company it may be how long is your sales process? What is the conversion rate on a customer? What is your win over loss rate? In some cases you end up with the LTD CAC or payback periods for salespeople. But at its very core the number one sets of metrics is like how many people are using it and how deeply are they using it and what does retention look like?

I need some traction. You need some traction. Let's get some traction.

Hey what's up innovators, entrepreneurs, visionaries and disruptors. This is your Traction podcast host Lloyd Lobo. We're a community of over 100,000 people just like yourself on a mission to help you get the methods, the money and the madness to explode your business growth. Featuring stories and tactical advice straight from those who've done it before, like Shopify, Twilio, Asana, and many more, this episode is brought to you by Boast AI. Each year, the US and Canadian governments give out billions of dollars in R and D tax credits and innovation incentives to fund businesses like yours. But the application process is cumbersome, prone to frustrating audits, and receiving the money can take up to 16 months. Boast AI gets you access to research and development tax credits and innovation funding opportunities without the headache and red tape. Join thousands of North American companies leveraging Boast AI software to maximize cashback, check out B Oast AI. This episode is also brought to you by Launch Academy and an international tech hub that provides mentorship, resources, network and the environment for entrepreneurs to launch, fund and grow their startups. Since 2012, Launch Academy has incubated over 6,000 entrepreneurs, of which 300 have grown their startups past seed and Series A and have collectively raised over $1.2 billion in funding. To learn more about Launch Academy's programs, check out Launch Academy.

When you're joining, please feel free to introduce yourself. Tell us where you're tuning in from, what city, what does your startup do, your name, what you're looking to get out of this session. If you have any questions, we'll take it in the Q and A tab as we go along or at the end. But feel free to introduce yourself. Michelle from Montreal. I'm tuning in from San Francisco. Elad, where are you tuning in from?

San Francisco as well.

Awesome. Good stuff. Super excited for today's topic. The information recently had a cover article Elad Gill is the Legend of Silicon Valley the Rise of Elad Gil, Silicon Valley's biggest solo venture capitalist. Elad has invested in over 40 unicorns. Affirm, Airbnb, Airtable, Brex, Coinbase, the names go on and on. GitLab, Gusto, Instacart, you name it. He was the founder of Color Genomics. He was the VP of Corporate Strategy at Twitter where he also ran product. He had joined Twitter via the acquisition of his company, Mixer Labs. Prior to that, he spent many years at Google. He was involved in three acquisitions including the Android team, and was the original product person, product leader for Google Mobile Apps. And prior to Google, Elad has had a product management and market seating roles at a number of Silicon Valley companies. He also has his PhD from MIT and has degrees in Math and Biology from the University of California, San Diego. And if you haven't read it, you must get it. His high Growth handbook is a must read for all startup founders. Elad, welcome to Traction. Thanks for joining us. It's been years. I've been trying to get you on the show for years. So finally I'm super excited you're here.

Thanks so much for including me today. Really appreciate you all making the time. Awesome.

And we have people from all over from Ottawa, Vancouver, from I don't even know where some of the cities, Seattle, Texas, Menlo Park. Wow. Philadelphia. People tuning in from all over to listen to this session today. So Elad, you've had a super successful career as a founder, as an executive, as an investor. Give us your backstory. How did you get to where you are today?

Yeah, I think I've just been around for a long time. Longevity kind of helps in terms of being in Silicon Valley. My career has really been focused on starting running and investing in technology companies and I started off very much as an operator. So I moved out here right as the dot com bubble was collapsing in 2001, worked at a couple early stage startups. Actually got laid off for my first company because it imploded and then eventually made my way to Google and that company was going through real hypergrowth at the time. I think I joined when it was about 1500 people and it was 15,000 people three years later. So we added 13 and a half thousand people in three years, which is insane. And so that just created enormous opportunity because when you're in a very high growth environment, you get to do new things. There wasn't really a mobile team in place at the time, so I helped build that from the ground up and you get to know everybody and you can really play a seminal role in a lot of early things. It's like being at Figma right now or Stripe right now, or one of those companies that are truly breaking out. And then I started a company out of that was bought by Twitter. And then similarly, there's a big high growth experience there of helping Twitter go from 90 to 1500 people in about two years. And then I started a company called Color, as you mentioned, which is really focused on sort of population health and care delivery now. And I was CEO there for the first few years and stepped back a couple years ago. And that was another really formative experience in terms of working in a more regulated market and something that really impacted people deeply in terms of their. Their own health and understanding of it. So, yeah, it's been a really interesting journey, definitely.

And how did you get into investing? Like, investing in one or two unicorns is already magic. You've done over 40 unicorns. So what is the secret sauce there? How did you get into investing and then hunting all these unicorns?

Yeah, and I think everything is unicorn these days, so I don't know what's impressive anymore.

But you know what? Everything is unicorn, probably in 2022. But you had the 40 unicorns when it was really a unicorn, the unicorns that you invested in. The benchmark today would be decacorn or $10 billion companies.

Yeah, I think I first started investing because a bunch of friends of mine were all starting companies at the same time, and we were all giving each other advice. Oh, which investors do you like or don't like? Or how are you trying to hire some people? And how are you finding your first engineer or whatever it may be to join the team besides the founders? Because the first hire is always the hardest one. I just help people out who are friends of mine with their companies. And then over time, people just started asking me if I wanted to invest as part of. And then it just organically snowballed from there, and it was really organic. The reason I ended up investing in Airbnb is the founders there reached out to me. I think when they were doing their Series A and trying to sort who to talk to and who to go with. And so I helped them a little bit with that, and I was lucky that they made a little space for me in their A round. And a lot of it was just almost happenstance.

And I think one of the key factors there is being helpful to the founders.

Yeah, I think it's sad how low the bar is for helpfulness. And so a number of companies have told me over time that amongst themselves Helpful investors. And I say that's horrible to me that the bar is very low. And so I think fundamentally just both doing something to help, being proactive, reaching out, asking is there anything I can be doing or hey, somebody sends out an investor update, you sort of chime in, you suggest somebody to hire or whatever it may be. I think even simple things like that go a really long way and then word just spreads and then that just led to people pinging other. Anytime somebody raises money, they go to all their friends who are running companies and ask them who helped them. And so I get a lot of, I've gotten a lot of intros to companies over the years that way just because as helping people out. And then if you're also operating then obviously you have a lot of current knowledge about how things work. And so I think that's really mattered in terms of coming from a strong operating background. So I can keep helping as companies scale up and things like that.

Definitely, definitely. So let's talk about starting up then. Because you've been involved with companies all the way from like idea stage through like exit, ipo, decacorn and so on and so forth. How should startups think about building products as they go from idea to product market fit to hyper growth? Let's start there. You wrote this phenomenal book. There's great advice there.

Yeah, yeah. I think each stage of company is radically different. And so if you're very early stage, the key things you really want to do is just don't fight with your co founder and find product market fit, which is incredibly hard. And there really what you're trying to do is very rapid customer discovery. And so you'll do highlights or proof of concepts with different people. You'll show mocks to potential customers. If it's a consumer app, you'll launch it to your friends or whatever it is. And so really early product development tends to be highly iterative, very fast paced and you're just trying to explore a market as rapidly as possible so you can find something that people are actually willing to pay for. At the mid stage of a company's life cycle, you have a product that's working and really the challenge is building repeatability around selling the product effectively and then scaling your organization. And at that point you have to start thinking of yourself as having two products. You have the core thing that you're selling to people and then you have your company that you're building. And just like you roadmap out your product, you need to roadmap out your company who do I need to hire? When and how do I think about my executive team? And how do I think about how big I'll be in a year or two years, whatever it may be? And then at the later stages of a company, the way you think about product kind of flips, because you go from being an innovative upstart into something that is a de facto slowing down. You're slowing down because your team size is expanding, so you need to do more around coordination. You start slowing down because you're putting in place a lot of process controls, because you may be going public. The de facto state of a company, as it gets later and later, is to become less and less innovative. And so the key for a later stage company is actually to fight that inertia that starts to emerge organically. In general, you could argue that companies that innovate early will keep innovating forever. That's like a Stripe or a Figma or something. And companies that innovate late never innovate again. And so you look at ebay as a canonical example, or some of these other companies, and the only way they've ever really been able to innovate is through M and A. They haven't really come up with an Act 2 ever for their companies. And so it's almost this rule of thumb is when you're in the mid stage of a company and you're rapidly scaling and you're building repeatability, you actually have to start thinking about, how do I put in place ways to innovate? So by the time I get to late stage, I actually know how to keep building new products. And that's where a lot of companies fall over.

Actually, the best companies you work with, or some of the most successful companies you work with, how did they go about early customer development and get their first customers? What are some really key tactics you've seen there?

I think there's great advice. I think it's from Paul Graham, which is you need to give yourself permission to do things that aren't scalable early. And for example, I think that was the advice he gave to the Airbnb founders earlier, which was, go and meet your first customers in New York and see what's working and not working for them, help them take pictures of their apartment so they look better on the site, et cetera. Just do things by hand that normally everybody would tell you, oh, how will you scale this? And how will you automate it? But often just doing it by hand allows you to really intuitively understand what's going on. But also just iterate more rapidly because you're not sitting there writing huge amounts of code that you then throw away when you realize it's actually not useful. So I think a big part of it is taking a very iterative approach early on. And if you're a SaaS company, it's really about how do you find the first handful of customers that are going to adopt what you're doing and how do you make sure that you're actually building something that they're willing to pay for eventually? Because one of the challenges for many early SaaS companies is you go and you meet with potential customers and the customers will always tell you what you're doing is great because they don't want to offend you, they want to be nice. And, and so really it's hey, are you willing to pay a prompt for this? Are you willing to sponsor development? Are you willing to spend time on it? Whatever the hook is to show real commitment usually helps you qualify, whether that person is truly interested or whether if you show up nine months later with a built product, if they'll say, oh, that's not a priority right now, let's talk in a couple quarters. And that, that happens a lot. You'll get really positive feedback. You'll go build something, you come back and they're like, oh, it's not for us.

And what are some key metrics you recommend founders have in place? How do you determine at what point you have a business right now? What are some key milestones for go no go in the early stage you recommend?

Yeah, I think it's a little bit hard to really know for sure. And it depends a lot on the type of company or product you're building. If you're building a crypto protocol like some new layer, one thing is very different from a consumer app, which is different from a SaaS company. Or maybe you're building an open source centric company like a DBT Labs or somebody. And that's a very different approach too, where often there you're going for share and adoption and then you turn on monetization later, which is more like a consumer app than a SaaS app in some ways. And so it really depends. Or you have companies like Cruise or Embark, which just I think went public today, where you're doing long term technology development, then your metrics are milestones. Can the car self drive for n blocks without an error or whatever it is? I think the type of business that you build or are building really drives the types of metrics that you need to put in place. In general, for each class of company, though, there are well defined Metrics. So for SaaS, David Sacks has a great overview of what are the different metrics you should think about in terms of negative customer churn and all sorts of other aspects. There's burn versus revenue ratios. There's all sorts of things for a SaaS company. For consumer, it's often about organic growth. And by consumer, I'm more like social consumer, not GTC or something. But it's often about organic growth, it's about churn rates, so you don't have too leaky of a container for your users. It's time spent online or on the product, et cetera. And so I think each product segment will have its own health metrics. And I think there's lots of really good stuff that's been done written about that now that's it's available online.

Is there. There's this sort of elusive concept of product market fit. What do you think about that? Is that a gut feeling? Is that a metric? Is that a combination? When do you think a company has found product market fit and it's time to pour gas?

Yeah, and I think we can come back to it. I think there's also a related question of how many times you have to find product market fit over the life of a company. Because sometimes you find market pull in an area, but it turns out that area is really small. And then you have to figure out how do you expand your product or your market. And so often that's this sort of notion of crossing the chasm. You find some early adopters in this product market fit in one segment, but how do you build that into a broader segment that really facilitates expansion? I think there's a radically different feeling between something that is working and isn't working. And most of the sort of Silicon Valley mythos is somebody shows up and they grind on something for seven years and then it magically works. And then they have a big company that they build and that you should keep going no matter what. And I think the reality is that most of the things I've been involved with that ended up working. Not all, but most started working really early. And you could tangibly see customers really pulling the product out of the company versus the company having to go and push as hard as it possibly can. Now it takes time to build a product, right? So the first year of any company almost as you build some basic thing, and then there's another year of customer iteration and testing and all the rest of it and then sales start scaling. And the question is, does it scale repeatedly and rapidly or are you growing at too slow of a rate relative to thinking that there's a real product there? And I think one early sign of product market fit is your product is incredibly broken, but people are still using it. And so there's such a clear need that even though your thing is crappy or hard to use or whatever, people are using it more. That was Twitter during the fail whale days where the site kept going down and people kept using the product. Or There are certain SaaS tools you use where you're like, this is like the worst UI I've ever seen. But you know what, I use this thing every day. And so sometimes product brokenness and usage, despite it being broken, is one of the clearest signs that there's a very strong need.

Because ultimately customers are looking for an outcome, they're not looking for software. And if you can get them that outcome, then that's probably a good sign that they keep coming back despite it being unrefined. So I've heard you say this often, every startup needs to have a single miracle. What does that mean?

Yeah, I think to some extent, if something was really easy to do, everybody would be doing it, right? And if something is trivial, there would be no room for a startup. And so almost every startup has one big thing that they have to overcome. And sometimes that big thing is they just have an insight nobody else has. And there's a thought process. In many cases it's building something that may be technically hard, or creating a new channel, or taking advantage of something that just opened up from a channel perspective. And, and effectively a miracle is like a low probability event that if you overcome it, you end up with a very big company. Sometimes you meet founders who have a very convoluted story in terms of how they're going to succeed in the market. I do A, and if I win at A, I can then go do B, which is this completely other thing. And that usually never works because what you start doing is you're compounding miracles. You have multiple things that are low probability events or low probability things that you need to overcome. And so if you have a 1 in 20 chance of any one given thing working, if you start having this convoluted thought chain of how you'll make something work, then eventually you just have one 1 20th times, one 20th times, one 20th Times, whatever. And then you're just never, it's never going to make it. And those are what I call like Multi miracle startups where you just start talking about some big picture thing you're going to accomplish, but it's just too convoluted in terms of how you're going to get there. You just need one miracle. You can't have multiple.

Definitely now in your most recent unicorns. Maybe it's trip actions, maybe it's gusto. What were those miracles? Or it could be any one of your 40. Airbnb is obvious.

Yeah, yeah, Airbnb is kind of obvious. Even something like Stripe. At the time everybody was like, oh, it's a crowded market and there's all these other payment solution and why don't you just use Braintree? So I think every company has the thing, even the ones that in hindsight are the iconic ones. Coinbase, is there ever going to be mainstream adoption of crypto? I got involved with them a little bit later, but I'm just saying even then people were questioning is crypto real estate? And today I think there's still people who are questioning if crypto is real. But I think it's a very obvious sort of long term thing. Instacart, it was like they tried this with Webvam in the 90s and so why would this work? Like obviously it failed at large scale before, so why is now suddenly the time that this thing should work? And sometimes you see companies that you invest in where the first version of what they didn't quite work and then they restart it based on what they learned and then it suddenly really takes off. So notion, for example, I invested in when it was just Ivan and I think he spent a year or two iterating on the core initial idea, which in some ways was actually a little bit closer to where Roan Research is now. And then he brought on Simon and they reset what they were doing and it just, it really started working really well. And so he was very thoughtful about let's take a step back and ask is this first iteration the right thing? And if not, let's do the right thing. Let's build a product that we think is a long term sustainable product. And you often see people like working their way towards the right end solution.

Definitely. Now, are there some key ingredients there in building that successful startup? And I think that varies right at early stage, from early stages to mid to late. But the early thing is most important because that's where startups die. Like for example, with notion, what were some key ingredients to their success? From going from that, hey, it wasn't quite working. Ivan iterated to success. What are Some key ingredients there.

I think in that case it was very much the product and it was a product centric approach. I think in other cases that people shift distribution or they realize they should just scale, go to market and then something works. And so I think for each company it's a different set of hurdles depending on what the company's actually doing and how can you reach customers with it. Notion is all about the product because very early on most of its sales motion was product led growth. People would adopt it and spread it. That may be very different from companies where the focus is really on top down sales, in which case it doesn't just, it doesn't matter, just that you have a good product. You also need to figure out the sales channel and the approach and how do you get your other leads in and then how do you convert them and then how do you do customer expansion, whatever it may be. And so I think most companies roughly fall into product driven, product led growth, et cetera, or top down sales, in which case you need a good enough product and then you need to actually figure out how to sell it. Again, assuming that you're doing SaaS, if you're doing consumer, if you're doing crypto, it's different things, right? In some cases it's community building, in some cases it's other aspects of a product.

Definitely. And the word unfair advantage gets thrown out a lot in Silicon Valley. How do you define unfair advantage and what are some tactics you've seen or done to identify unfair advantages and optimize for them?

I'm not a big believer in that framework. I think that's one of those things that people discover in hindsight. They say, oh, this person had an unfair advantage because of xyz. And you're like, nobody realized that at the time. You're making that up. In hindsight or retrospectively, you can analyze something and say, oh, okay, these are the things that differentiated this company and that's why they won. Every once in a while the unfair advantage will be a clear one, which is, oh, this person built the same product three times internally for different companies they worked at and now they're going to go and build it for the rest of the world and they're going to sell it externally and they really understand what to build and why and how and the different use cases because they built it multiple times in the past and so they can immediately jump to step N because they know what it is. So sometimes you have something truly like that, or you have somebody out of an industry or market that they understand deeply and therefore they can make faster progress or they have customer relationships they could take advantage of. And so more often I think you see these unfair advantages with second time founders or people who have a lot of experience because then they base something on that experience. If you're dealing with somebody who's straight out of school, it's a very different scenario because you just don't have that many things that you're uniquely that you uniquely view or understand.

Definitely from a failure perspective. Right. I think one of the key things is like you're hanging on for dear life in the early stages and you gotta get that hurdle. What are the top three or four things you see why startups fail and what should they watch out for that kill early stage companies?

Yeah, I think there's only three things that really kill early stage companies. It's you get into a co founder battle and so often that's because you haven't defined roles up front clearly in terms of what you and your co founder will each be doing or how do you make decisions or who's actually in charge and you just freeze up as a team and you don't make forward progress because you spend all your time fighting with your co founder. And I think that's one of the big sort of myths of Silicon Valley is that you need an equal co founder. And I think that's actually if you look at the very biggest outcomes, almost all of them had solo founders or unequal foundering relationships. It was Steve Jobs and Steve Wozniak where Steve Jobs had more of the equity and was clearly in charge. Or Bill Gates at Microsoft was clearly running it from day one and had outsized equity relative to other folks eventually because it's co founder left or you look at Amazon effectively a solo founder or Oracle effectively a solo founder. So you go through the history of tech and almost everything actually is an unequal co founding partnership or a solo founder Zuck at Facebook or Reed at LinkedIn. And so it's really weird that there's this myth of needing an equal founder or equal co founder. And then there's some counter examples of that. Right. Google is the big one that I think is one example. But I think also YC has propagated this notion that you need an equal co founder and I think that's false. So one thing is, and they have very good advice in general, I just think that's one area where I differ in opinion with them. And I think the data backs me up actually. But I think number one is you fight with your co founder. Number two is you run out of money. And number three is you don't get to product market fit, which means you run out of money. That's the reason you run out of money is you don't have product market fit.

Definitely, I think 2 and 3 is not as painful as 1, but. So let's take it with 1. What are the traits of a great founder?

The trivial version of it would be somebody who can find product market fit rapidly. But that isn't necessarily a true trait, I think, obviously like ethics, et cetera. So you don't want to be involved with people who are bad people. But on top of that, the ability to learn really quickly, independent thinking. So somebody who often you see the best founders go and talk to five or six different people, get a bunch of opinions and then decide for themselves. And they're good at synthesizing the various opinions and then just deciding what they're going to go do. I think a lot of founders early on are very consensus driven if they haven't managed a lot of teams before. And I think eventually many of them become quite decisive. And so I think decisiveness over time actually can matter quite a bit. But the reality is the single most important thing is finding product market fit. And I'm a very big advocate of. Andy Ratcliffe, one of the founders of Benchmark, basically had this saying that great team, terrible market wins. So it doesn't matter how good you are, if you're in a bad market, you get crushed. Terrible team, great market wins. And so you could have an awful group of people in a great market and you'll build a really good company and then great team, great market, something magical happens. You not only are able to get to some form of product market fit, but you're able to exploit that and grow it. And then you end up with a Google or an Amazon or a Tesla or a SpaceX. And so I'm a very big believer in that. And I think the single biggest determinant of startup success is the market. And that's why I'm saying trivially, the most important trait for a founder is the ability to find product market fit. But that's really hard, definitely.

So I guess the core definition then, if you look at it across products or product market fit, is people want to keep using it and keep coming back. Is that how you would define it? High retention?

I think high retention is typically important. And in general, you want businesses optimally that have very high negative churn. In other words, you keep expanding in the set of users that you have. And that could mean if you're a consumer product, you're expanding and with within a social network and the usage of each person. If you're a SaaS company, what you really want is a business where, say that you're doubling every year. If 40, 50% of that growth every year is just customer expansion, your existing customers are just paying 50% more every year, then it's much easier for you to double every year because every year you start with half of your growth already locked in because of your existing customers. And so you look at some of these companies that are vertical SaaS companies like Aviva, and they have insane customer expansion characteristics. This company's doing low billions of revenue now. It's like a 40, $50 billion market cap company and they're just expanding 40% a year. I haven't checked the most recent numbers, which is really insane expansion on that base. And then anything they add on top is just on top of that. And I think that's the characteristic of a lot of great vertical SaaS companies. And I think there's companies that have a lot of promise on the startup side like a benchling or Applied intuition or some of these other vertical centric companies that the hope of companies like that is that they get in with the customer base, but then they can keep cross selling and expanding over time.

Definitely now you've hit product market fit. What's next here? How should startup think about growth? Talk through like identifying the right channels. Who are the key hires you make on growth? What are the metrics to look at?

Yeah, I think it again depends on the type of company. So I think if you're a SaaS company, really what you're trying to do is build repeatability. And so stage one is, do I build a product that anybody cares about? Stage two is how can I turn it into a machine where I turn the crank and more customers show up. And then in parallel, how do I keep moving my product forward so that I build defensibility, I expand my product line, I can sell to more customers, I can create expansion opportunities, et cetera. And then the third crank that you're trying to turn is organizational. How do I hire executives or team members who can then have units of people built around them so I don't have to do everything myself as a founder? And so I remember a couple years ago I was on a panel where I thought some of the worst advice I'd ever heard was given, where somebody on the panel said that he felt that you should do every role yourself before hiring for it. Which is awful advice, of course you shouldn't do that. You should figure out how to effectively hire a finance person. Why would you be doing all the finance? You'd probably screw it up. Hire a great recruiter, obviously you're going to do some of that yourself. You should hire a great salesperson if that isn't your competency, et cetera. And I think a lot of what happens later in the life of a company as you're building repeatability is eventually you're delegating big chunks of the company to people who are domain experts who are like, okay, I know how to run a sales team and I'm going to set up these processes and these goals and I'm going to comp the sales team this way and I'm going to figure out how to generate leads and then I'm going to have the team harvest them and I'm going to divide regions this way. And eventually a lot of the progress that you're going to make make is based on that. A lot of the early core metrics to get to your original question that were going to be things like for a SaaS company it may be what it how long is your sales process, what is the conversion rate on a customer, what is your win over loss rate, what is the. In some cases you end up with the Ltd CAC or payback periods for salespeople. But at its very core the number one sets of metrics is like how many people are using it and how deeply are they using it and what does retention look like?

Definitely I get asked a lot about silver bullets or what's the new channel to focus on? How should startups think about prioritizing growth channels or where to invest in.

It? Depends a lot. I think obviously there's a lot of excitement right now around product led growth and really what you're just saying is does your product have characteristics that it naturally spreads to new customers is really what that means. And that's something that was exploited heavily in the consumer social waves and there's lots of companies that were doing it years ago, but I think now it's become a trend that people talk about and obviously I think that's a really exciting channel or area. But I think the mistake people make is sometimes they think everything needs to be product led growth when their company really should be just top down sales or alternatively they have a product led growth channel but then they don't really harvest enterprise through direct sales on top of that and an example of that would be when Slack went public, I believe it was 575 of its customers made up about 40% of its revenue.

Wow. And all enterprise deals.

And it's all enterprise deals. And so Slack is one of the most product led growth companies. But you know what, they were heavily enterprise dependent. And when you talk to people who are there during that period, they say we screwed it up, we should have done more enterprise sales. We waited too long. We weren't harvesting our customer lists, we weren't going through and seeing how many people had adopted it in Org and then converting that effectively. And so maybe it should have been 70%, who knows? Right? Like what it should have been. I think people who have product led growth engines at work sometimes wait too long to do real sales on top of that.

Definitely, definitely. Let's get to scaling. So you've identified product market fit. Let's say you figured out the right channel. Who are the key people you start bringing in and in what order? Because this is where you go from the generalist to start specializing now. So how should founders think about it? Who are the key people they should start bringing in and in what order from like product market fit to scale?

Yeah, if it's a SaaS company, I think the initial set of people that you really want to start hiring on are sales and go to market leadership. And so somebody who can effectively run marketing campaigns for you so that you're generating leads and then somebody to go and drive sales. And then very quickly thereafter you probably bring on a customer success person or set of people to start focusing on customer expansion. And then obviously in parallel, you're building out your end org and your product org and once you hit somewhere around 30, 50, 70 people, you start bringing on core HR and finance and things like that. And then prior to that, obviously you probably brought on like some recruiting function and things like that. So it evolves over time. I think the mistake that a lot of first time founders make is that they hire their executives too late. Because when you're ramping on an exponential, the early part of the ramp looks a little bit like a linear curve, but in reality it's about to inflect. And if you take too long to hire, then you get hit really hard suddenly six months later by having a lack of capacity across the team to actually deal with all the stuff. Because dealing with three customers is very different from dealing with 50 customers. And if you're growing 20% month over month, that catches up with you really fast. But you don't think that way because we're not used to thinking in terms of compounding. And so most first time founders that I know end up hiring executives way too late and then they really suffer for it. They have a period of a year or two that is really rough because the company's working, but you don't have the internal capacity to actually deal with it.

Definitely. And so what is too late in your opinion?

I think that it depends on how quickly your revenue is ramping. And by the way, I'm going to say it depends on everything because ultimately I think that the only good generic startup advice is that there's no good generic startup advice. It's all contextual. If you're growing from 1 million to 10 million in revenue a year to 30 the next year, to 100 the next year, that's very different than if you're growing from 1 to 2 to 4 to 8. You're almost on a linear growth path. Even though it's not linear, but it's not big enough changes that your entire org has to shift. But in the first case, your entire org is shifting really rapidly. If you're looking at your growth rate and you're extrapolating ahead and then you extrapolate your head count, you're going to realize that you need to hire more people in place who can help scale things up. And so usually if you're like 20 to 30 people growing to 60, 70, 80 people, you should start hiring some executives.

Definitely. Definitely. That's funny. We bootstrapped the company to about eight figures and it was a pain. Founders doing everything going into eight figures.

It was crazy.

So I completely feel the pain.

I should say something on that. Sorry to interrupt, but I think it's interesting. A friend of mine pointed this out to me where he's look and this is a very successful founder, right? Running a tens of billions company. And he was telling me that when he first started, he'd look at these second time founders and in their first 15 hires they'd have three VPs. And he'd be like, this is so stupid. Why is it so top heavy? Why do they have a VP engine, a VP sales and a VP this and a VP that. They're only 15 people. And he's Now I understand because if I were to ever start a company again, I would immediately bring on those people too because it gives me leverage. And as a first time founder, you often can't attract those people that early. But if you can get them, they give you so much more leeway. On time and so much more leverage. Of course, you bring them on board. And so I think that's one of the big differences between somebody who's gone through scaling and hyper growth before and somebody who hasn't is you realize the extent to which these executives will actually enable the company to move dramatically faster.

Definitely. And if you do it too late, then they're going to take a lot of time to ramp up or processes and so on, and that inevitably slows you down. Right. In the first few months. In your opinion, what are the key steps to successful hiring? Because it's how can founders build these teams? Everything. The world is dispersed right now. Yes, Silicon Valley sees a new unicorn every day. But, like, how do you compete? What are the key steps to a successful hiring?

Yeah, it depends on whether it's an individual contributor or an executive. So which of those would you rather I talk about?

Let's talk about IC first and then we talk about executive is hard.

Yeah. On the IC role, it comes down to what type of person you're hiring and whether you have experience hiring them or not. For example, if you're an engineer who's never hired a salesperson, you should probably go and talk to a few other founders and ask them about their first sales hire. Or even better, go and talk to VP sales at companies that are clearly working. So people who really know their discipline and ask them questions. What should I look for in my first salesperson and what seniority and what companies in my market segment do you think have really good people? So I should go after people at those companies. What sort of interview questions should I ask them? How can I vet if they're actually good or not? And so I would just go and ping three or four VP sales at good companies and ask them for their advice. And then I would follow whatever process they suggest because you won't have the context of how to hire that person otherwise. In some cases, I've actually had external people help me with my interviews and I've done that for startups that I'm involved with as well. For some companies, for example, I've interviewed all their CFO finalists and then I'm part of their hiring huddle because they've never hired a CFO before and they want an external voice on it. But you can similarly do that for ICs. For my first startup, we had some really strong engineers on board early, but we didn't have enough to do a full interview panel. So we actually hired a couple of our friends as consultants. So we had a big enough panel to really feel that we vetted people aggressively. And so I think sometimes you can also just pay people to effectively consult and by that just do interviews for you. If you want to broaden the set of people who are weighing in on something that you're either unfamiliar with or alternatively you just want a few extra opinions.

Definitely. What are your top maybe two or three interview questions that you use to assess if this is the right fit or not?

You know, I found that people are remarkably self honest if you start asking a lot of questions about how good they are relative to their peers and how effective and how much should they get done and all that kind of stuff. And so I think there's one whole line of questioning which is just how good are you? And sometimes I've had people tell me I'm okay. Like I think a lot of people are better than me, I'm better than a subset of people. And then you reference check them and people tell you the same thing and you're like, wow, I'm not going to hire this person, they're low average or whatever. And then obviously there's things around culture and ethics and all that kind of stuff as well that I think you can tease out pretty rapidly.

Definitely as you're scaling really fast and growing. You're in 40 unicorns, so you've probably seen it, these teams are doubling, quadrupling, things eventually start to break or inevitably start to break. How do you watch? What signals do you need to watch for that things are about to break?

Yeah, I think the simplest thing is you can actually plan ahead for it. It's just most people don't. And so if you're just planning out your growth rate and then you're looking at your team growth rate and your customer growth rate, you're about to hit a wall. It's just people tend to self delude that they can handle it instead of saying, oh, you know what, I should go hire these two executives and these 30 team members because otherwise we're going to be completely overwhelmed. And to manage those 30 people, I'm going to need five managers or whatever it is, or four managers or whatever the right number is. And so depending on the type of person. And so I just think people just don't plan ahead on it until they've done it once or twice before. And that's sometimes actually how you can tell if somebody is a good executive because usually the executives who know what they're doing and their first couple weeks after they're hired will come to you. And they'll say, here's what I think the org chart should be and here's my forward looking plan, and here's my 30, 60, 90 day plan. Whatever it is, they'll actually come to you and they'll have mapped out what they think their function should be doing and how. If you're a first time manager executive, you never think to do that. But as a founder with a rapidly growing company, you absolutely need to be doing that. Similarly, you can see that you're starting to get really harried. You're showing up to everything late, you can't keep on top of everything. Those are very clear signs that things are breaking. Or alternatively, your team members are the same way. Aren't able to hire really good senior people. They aren't able to plan ahead. They're constantly reactive. Sometimes they look really rumpled or unhappy and that's because they're in over their heads.

You know, definitely on the concept of rumpled and unhappy. I believe there has been this concept over the last 20 years of hustle porn in Silicon Valley. Everyone should work 80, 100 hours and expanding to the whole startup world. Is that a thing? What is your thoughts on that? Because that rumples and stresses on people. Eventually people burn out, right?

Yeah. I think people need to figure out how to get leverage to have a long term sustainable career. The flip side of it is I do think you need to work hard to be successful. So I'm not one of these people that thinks if you work 30 hours a week you'll do great. I think there are people like that. I think most of the time you have to work really hard to get to certain levels of success and different people have to determine where that is for them. And then I feel like they're the people who just win the lottery tickets. Right. They're at Google early or they're at stripe early or whatever. And it's always possible there's people who weren't working that hard, but they hung out and weren't noticed and they did really well financially because they just were at the right place at the right time. But on average the people that I know who've done best are people who are hardworking.

Definitely it makes complete sense.

I do think, by the way, that there's all sorts of things you can do to balance out your life. So if you're working really hard, make sure they have time to work out and re energize, make sure that you're sleeping well, make sure that you have the date night with your Significant other, whatever it is. But I do think that the people I know have done best for Park.

Definitely now at scale, you're hiring lots of people, you've brought on these execs. What is the job of a CEO? What are the two or three things the CEO needs to do day in, day out to manage this?

Yeah, at a very high level, I think the job of the CEO includes setting the overall direction and vision for the company and then the processes and goals and everything else to help reinforce that direction and vision, sort of the communication of that. Second, it's finding the right people for the team and then empowering growing those individuals. Third is ensuring the companies will capitalize as money to run on and then allocating resources against number one, which is that vision and direction. I think that's really the three most important things.

Definitely. And working across all these unicorns and startups, you know, we've seen like founders leave or they're not there through the ipo. At what point as a founder you say, say, I'm not the one for this anymore. Maybe I should bring somebody else.

Yeah. I think it used to be 20 years ago that in too many cases the founders would get replaced by a professional executive. So if you go back 20 years, actually that was pretty common. And then I think with Facebook, Mark hired in Sheryl Sandberg as coo and she took on all the other functions and that became the new model because that worked so well. Right. Where the founder CEO kept running the company and then you bring in other people and on average, founder led companies tend to do better. If you look at long term performance in the stock market or things like.

That, definitely from Shopify to Airbnb, the fastest, the biggest valued companies are founder led. I think it's hard to replace founder vision.

Right. It's hard to replace founder vision. There are some circumstances where the founders really shouldn't keep running the company.

What are those?

In some cases, somebody just hates the type of work you need to do as a CEO of a larger company and they aren't able to delegate enough portions of it to other people that it makes sense for them to maintain the role. And so occasionally you see somebody who's incredibly unhappy in the role and they hate what they do day to day and it's not healthy for them and it's not healthy for the company. And in some cases those individuals realize, hey, it's time for me to move on. In other cases, they don't. And I think there's always these interesting questions and challenges of if Somebody decides to leave, how do you help facilitate that transition? And everything definitely makes sense.

How do you know when a startup can become a multibillion dollar company? Like when you saw a company like Stripe early on or Airbnb or early on, I guess Airbnb Hindsight is always 2020. Everything seems obvious. But what did you see that led to the market was so big? Or this could be a multi hundred billion dollar company.

Yeah, it's interesting. If you go back 10 years, I don't know anybody who would have guessed that Google would be a $2 trillion company. And if you look at Google's metrics, it's trading at something. I think it's 28x EBITDA. And it grew 40% year over year in the last quarter. And it added, I think it had a $64 billion quarter. So that's actually in some sense cheap for a company. That's amazing metrics at a $2 trillion market cap, it's actually a reasonable price in some sense based on historical norms. And all these markets have gotten dramatically bigger than anybody thought. And global liquidity on the Internet is at a scale that nobody, I think, imagined 10 years ago. And that's hours spent online, that's transactions online, that's the number of users online globally, et cetera, mobile device connectivity, all this stuff just blew up. These markets to be much bigger than we ever thought any of them would be. And so 10 years ago, when people were investing in Airbnb or Stripe or things like that, a really big exit was like 1 to 5 billion. That was like, oh my gosh, that's a super home run. That's like a grand slam. And so I think because the Internet and technology has proven to be such a large and potent force, bigger than anybody anticipated, the outcomes are getting bigger and bigger. And I actually remember having a discussion with a friend of mine. I was an investor in both Stripe and Square. And at the time, I think Stripe had just raised it 500 million and square had raised a billion or something. And we were trying to guess which would be a bigger company. And we said, wouldn't it be amazing if Stripe would be worth three or four billion dollars? That would be insane, because at the time, the biggest payments companies before that were braintree and authorized.net and all these companies that ended up exiting for half a billion to a billion. So 4 or 5 billion would have been a huge thing above it in Stripe, which is twice that. What if that was 5 to 10 billion? What if it kept being twice that? Oh, my Gosh, mind blown. That's such a big outcome. And so I think even at the moment, it's going to be a much bigger company. But it's often hard to know truly how big some of these things will end up being. And I think the single biggest indicator in hindsight is the growth rate of the companies, even on large amounts of revenue. And it's all about compounding and to some extent, the rate at which you can grow the company is reflective of the total addressable market, or tam. In other words, growth rate and market size are highly correlated and the growth rate is caused by a big market. And so sometimes you just look at something, you're like, oh my gosh, look at that growth rate. This thing is in a giant market because the growth rate is indicating as much.

That's great advice. Growth rate, market size dictates everything. That goes back to your earlier point about great team, great market, magic happens. Let's move into fundraising here. I said, how did you identify these? I think growth rate was a big indicator, but the market is bonkers right now. Sometimes feels like the demand is artificial, there's large supply of cash, but Covid has brought in maybe some artificial demand for products that might taper. How should startups think about fundraising and valuations in this environment?

Yeah, it's interesting. In an environment where there isn't a lot of money available for startups, I think the single best piece of advice you can give somebody is keep going no matter what. You need to hit the next milestone, you need to survive, you need to be able to raise money for the next thing you're going to do. In an environment like this where people give you money, no matter what's happening with your startup, maybe the best advice is you should think about exiting sometimes once a year, take the time and actually ask if you should keep going. Because whether you should keep going or not, people will give you money. And you shouldn't interpret the venture capitalists willing to fund. What you're doing is a sign that your thing is actually working. And one thing I think that's really under discussed right now is maybe you should exit. Maybe your thing isn't working, maybe you should reconsider or at least have the hygiene to think about it once a year. Just have that board meeting once a year where that's what you discuss. And everybody knows that happens once a year. So it's not emotional. And it doesn't mean you want to exit or don't want to exit. It just means you'll think about it. In a rational way, because otherwise you're just stuck for years. Now, the counter to that is to say there's so much secondary liquidity available that even in very early rounds, people are increasingly taking out money. And so maybe financially the smartest thing to do is just keep raising at higher and higher valuations and take out money even if your things aren't working. But of course that's terrible for your employees, that's terrible for your investors, that's terrible. I think it's not the best way to think about how to succeed in life, but it is increasingly an option in some sense today. So one answer is that think about exiting actually sometimes if your company isn't actually truly working. I think in general, when you're doing a fundraise, you want to make sure that the amount of money you're raising at the valuation that you have will allow you to hit enough major milestones that you're able to raise at a two to three times higher valuation in the future. And so you want to make sure the other Runway to actually get to the milestones that allow you to grow into the valuation you have.

That's fantastic advice. Have enough Runway to grow into the valuation you have. What dictates valuation? What dictates a 10x versus 20x versus 100x valuation? Is that all growth rate or is that a combination of growth rate and retention? Or is it a combination of some other dynamics?

Yeah, it's usually growth rate, some form of retention, some view on tam, some degree of hotness in the market, just in terms of is it a mean market or not? So it's a mix of stuff. I think it was David George or somebody from Andreessen had this really good insight which is if you look at the public market multiples on SaaS companies, for example, and we're in a market environment where I think they're at literal all time highs, right? Like Snowflake is trading at ADX or whatever it is. Most of the public companies, it seems, are sandbagging right now, right? They give numbers and then they always beat them. And so the comps on those in some sense are fair because they actually are going to do better than the projections. And so the comp is 80x revenue, but in reality they're going to do 60x because they're going to hit better numbers in the year that's coming because they sandbag. Private companies, on the other hand, tend to miss their numbers more frequently. And so to some extent private companies are getting these public market multiples. But in reality, they're undeserving of them because the public markets tend to overshoot and the private companies tend to undershoot. And so you have this disparity between how you should really be thinking about multiples versus comps in public versus private. But in general you set a lot of the comps based off of the public market stuff.

Definitely. So what growth rate then commands a greater than 20x multiple? Is it like a 2x year over year? Is it a 3x?

What have you seen? Typically it depends on the stage of company because if you're very early, say you have a million in revenue, growing 40% a year is really bad. If you're a venture backed startup, if you're running the business for cash or bootstrapping, that may be fine. But if you're like I'm going to go raise a bunch of venture capital and you raise it and then you're growing 40% on a low basis, that's just too slow. Even if you're doubling every year, but you're going from 1 to 2 to 4 to 8 to 16, it's just too slow. Relative to some of these companies that are doing 1 to 5 to 15 to 45 to 90 to 180 companies actually do that sometimes. It's rare you see it and it depends on your basis. The flip of it is if you're doing a billion in revenue and you're growing 50% a year, that's amazing, right? You're going from 1 to 1.5 to 2.25. You're just stacking and or Google grew 40% on 40 something billion in revenue to 60 something billion in revenue. That's insane in terms of growth rate. And so it really depends on the scale that you're operating at. In general, the larger cap SaaS, public companies seem to have an elbow in the curve at around 40% growth. If you're over 40% growth rate, you get compensated really highly in terms of multiples. If you're under that, your comp starts to degrade and that's where you see a Dropbox or something that's trading at I don't know what it is now. I'm guessing it's 5 or 6 or 7x revenue.

I guess the 40% over growth rate is probably at scale but in the early stages does the triple double rule of thumb is that accurate?

It's reasonably accurate. But your numbers have to be big enough because if it's 100k to 300k to 900k to 1.8 to 3.6, that's not that fast. And again, if you're like two people and you're running it for cash, that's amazing. And so I think part of what people have to ask themselves as well is what is their goal as a founder and what sort of company are they trying to build? Because I think all too often people only view the venture capital model as the right model. And I actually think for a lot of types of companies, that's a terrible model. And in some cases you can do better financially, impact wise, whatever it is, by just building a business that's a services business, printing cash, or other types of businesses where you're harvesting along the way. Or alternatively you just don't raise more money. Why dilute Zapier raised, I don't know how much, say a million dollars or something. And they never raised again. And now they're like a $6 billion PL. So a lot of people I think feel like they need to raise money for social reasons or for hiring or for all sorts of things. But I think in reality, like you see all sorts of models where you don't have to do that. So I think if you can avoid it, it's a great thing. Like, why raise money if you don't have to?

Definitely. And I think what you said, it still holds true earlier is raise enough money to get you to the next growth milestone or profitability.

You can also go profit. Like why not be profitable?

Definitely. Are there some key metrics you look for at each state? Let's say maybe rapid fire here. Pre seed. What excites you? Seed A and B.

What excites you?

What sort of metrics?

Yeah, and all these things are really blurry now because when I started my first company, we did 1 1/2 on 6 pre from Sequoia. And people at the time said that was insane. They said that's almost a series A because at the time series A's were two or three million dollars. This was back in like 2007, eight or whatever. Right. 14 years ago, one and a half million was almost considered a series A. Two million was considered a series A and A seed was like 300k. And so all those rounds have shifted down a level or two. And so now a pre seed is a couple hundred K to say a million bucks. And then a seed is anywhere between two and six or something and bigger and bigger seeds and then A's are bigger than that. At the seed round, it's often just two people with an idea or a prototype or Something partially built and then seed is usually you have something built and potentially you have some customers. Not always. Sometimes. And then an A usually means you have something that's working and you want to start building repeatability.

AN A is 1 million. AN A these days is half a million. An A. What is an A in revenue? That is ar.

Oh, in revenue, there's a lot. I'd say it's somewhere between 300k and 2 million.

Wow.

It depends a lot on the company and the market segment. And what's the model? Is it open source or not? And so I just think it just varies by what is the thing.

Definitely getting close to the top of the hour. I'm going to take the last few questions here. As a CEO or founder, how do you ensure everyone on the team is well aligned with the broader strategy and goals? Like how do you train the organization to make better decisions when the leaders.

Are not in the room? Yeah, I think it's three things. Number one is you need to be clear on what your goals are as a company and what sort of decisions you want to have happen. Number two is you need to reward behavior and progress against those goals. And number three is you need to be highly repetitious so that you keep saying the same thing over and over again so that it sinks in so that people think the way that you think. And often first time leaders or managers feel awkward saying the same thing over and over because they think they're being boorish or that people are ignoring them. But in reality, you often have to repeat things 100 times before people start saying it back. And so that repetition and that willingness to be repetitive actually matters a lot. So I think those things are really important. An example of that is when I was at Google, the number one reason Larry Page would get upset with the team who came in for a product review is if they weren't thinking big enough. And so he was constantly pushing people on like, why are you thinking of doing a small thing when you could do this much bigger thing? Why are you focused on the small market versus this big market? And so that way of thinking spread early on amongst the early employees, where often you pitch somebody an idea and they're like, that's not big enough. How do you make that bigger? And so that was part of the sort of cultural fabric of the company eventually. And it was just because of Larry repeating it constantly in meetings.

Definitely that's some great advice here. As you look at your career or.

Maybe some of the startups you worked.

With, maybe with yourself. What was your toughest, lowest point in your journey and how did you navigate it? And how do some of the best founders navigate low points?

Yeah, I think startups are always hard and they can be very emotionally challenging. And as a founder, I think you feel a real weight on your shoulders in terms of making sure your employees do well and that you're serving your customer needs and your investors will do well and all the rest of it. And you also have a lot of things where somebody comes in at 8 o' clock at night on a Friday and they tell you that they want to quit and then you try and save them through the weekend and so your weekend is suddenly just completely vaporized. And so it's back to a lot of things that I mentioned in terms of workout, sleep. Try and make a little bit of time for a hobby so that you have something to offset the ebbs and flows of a startup. Because if you have something else in life, then you can smooth things out a little bit. It could be just like workout goals or whatever. So it ties to this getting exercise thing. Eventually, within a couple of years of starting your company, those things should all smooth out. Because if your company's working, you should have a set of executives who can help buffer you from a lot of that. And you can handle big areas themselves. And then your role should get a lot easier, actually, if you're doing things the right way. Because I think executive bandwidth fundamentally creates the space for you to re expand your life again. So I think it's just making sure again that you have other things going on in life besides just your company at all times. In the early days, in the later days, it naturally happens.

Definitely. What's the one piece of unconventional advice founders typically ignore but shouldn't?

Oh, I think there's a couple of those. I think you don't need a co founder. And again, the biggest tech companies, almost all of them, either had a solo founder or a unequal founder relationship. I think you should occasionally think about selling your company, which is not advice that's given anymore because I always go. And then I think people need to realize that leadership eventually is not about consensus. It's good to be decisive. People on your team are not founders. They're people who in some cases want direction and want a decision. And if you're trying to build consensus all the time, they may actually dislike it. And then lastly, I think similar leadership is not a popularity contest. You're not there to please everybody. You're there to, in some cases, make unpopular decisions that may Save your company.

I love that. Make unpopular decisions. Leadership is not about consensus. A couple of questions here, actually. What tells you an early stage startup is trying to do too much?

I think that there's two types of trying to do too much. There's we have such a big opportunity and our customers want so many things from us that we're trying to do everything simultaneously and we're splitting the team too thin and we have half an engineer on each of three things. And people are constantly mood switching and not getting their work done because opportunity is so big. So one form of it is the positive form, which is there's so much opportunity, we're spreading ourselves too thin and we need to reconsolidate and say what's important and what isn't. The other version of that is sometimes you see founders hedging because they realize that their thing isn't working, but they're not willing to admit it. And so then they start diversifying product lines really early, before they have repeatability in their first product. And the claim is often, oh well, this is really related to what we're already doing, so we're adding it. But if you dig in, you realize the thing that they're already doing isn't quite working, but they're unwilling to shut it down or let it go. And so they start spreading resources too thin against a bunch of different things because they're placing bets and usually that's a bad way to go.

I think I've found, at least from personal experience across a couple failures, and most is doing okay is you can build a pretty big business serving one kind of customer through one kind of channel, at least till about 5 to 10 million in ARR. That said, when do you think is the right time to add a second product or your second act?

Yeah, I think it's when you have some revenue scale. So it's at least. I don't know an exact number. I'm making it up. Right. 10, 20, 30 in revenue, it's clearly like scaling. You have repeatability of machinery to keep that core product scaling and then you have enough team bandwidth to do something new. And team bandwidth may just mean that you have a dri, a directly responsible individual who can go and start a new area. You need scale, repeatability and bandwidth.

Scale, repeatability and bandwidth. And we have another question here. What advice do you give founders that are afraid to fail? I think failure is inevitable, right?

Yeah, I guess it depends on the situation. Right. If you've been running a company for five years and it's not working. That's different from hey, should I go start a company to begin with? I think the reality is that if you're a talented individual, there'll be lots of jobs out there for you because technology hiring is so tight that there's an enormous safety net just by dint of there being all these companies that are hiring right now. And so I actually view startups as a reasonably low risk thing to do. But I think it's also stage of career dependent because to some extent I think starting a company is an act of desperation. If you're an executive at a big company and your next role is to be an executive at a big company or at a great startup that's working, that's a dramatically risk reward ratio. Right? And so to some extent people often start companies because it helps them leapfrog a couple years of career because they're managing people sooner, they're doing multiple roles sooner, they're doing all this stuff sooner. Or is it because they're so compelled by something they can't stop themselves from working on it, or they really want to feel like they've started something from the ground up for one reason or another, but otherwise there's no reason to start a company. I think it's a very rough path. It's a very stressful path.

It is. You can make more money elsewhere. As you look back on your career investing, founding, advising, is there anything that you would do more of and is there anything you would do?

It's a good question. I probably would have started a company earlier. When I moved out here though, the entire ecosystem was collapsing. I probably would have skipped grad school. I just would have gone and started a company straight out of school. That's probably what I would have done differently.

That's what I tell my kids. They're young, but I keep saying start a company before you even go to high school. You have a phenomenal book. I dropped the link here. High Growth Handbook, folks. Please get it. It's amazing. I have it, I've read it. It's unbelievable. Are there any other books that have informed your life or help you out that you recommend?

That's a good question. I read a lot of sci fi or a lot of novels just in general. So I actually don't read that much nonfiction anymore. I used to read a lot of it. I like Ben Horace's book the Hard Thing about Hard Things. I think that there's a book called First Break all the Rules, which I think is a reasonable book on managing and leadership and stuff like that. It's a very old school book. On average. I read more to unwind or in some cases I'll go deep on a certain area in terms of, you know, a certain aspect of history or something else. But I don't read any business books at this point. I haven't read a business book in a long time. Book is pretty good actually. That's, that's what I have looked through.

So I've read. I hate reading, by the way. And so my hack has been. I invite two smart people a week and interview them and ask them all kinds of questions. But the two books I've read in recent times is your book and Reid Hoffman's Masters of Scale. Because there's a lot of good stories in there and I think there's something to say about reading a lot of sci fi. It expands your brain cells and I.

Just think it's fun. And I agree. I think Reid's book is good, like Masters of Scale.

So awesome. Thank you so much, Elad. This was very informative. We rarely go 10 minutes past the top of the hour, so thanks for your time. Sending you great wishes for another 40 more unicorns or decocorns. And thank you so much.

Anna, thanks so much for including me and really appreciate everybody's time today.

I need some traction.

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