#132 Founders Fund's Partner, Brex's ex - CRO, Sam Blond

I've always had this mindset that I wanted to be the best, and this is a little bit of that, that like competitive spirit that I talked about. I want to be the best at anything that I do, and for me, the best is being number one, uh, and anything less than being number one was at least interpreted by me as a bit of a failure.

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Thank you so much for having me, Grace. I'm happy to be here.

I'm a huge fan of your mini podcast on there, like SaaS-ter, and I feel like I've learned so much sales under like an hour or like 30 minutes, like so many times by like, you know, you interviewing all these like other sales leaders in the industry. I just feel like it was awesome.

Well, thank you for saying the feeling is mutual. You've built such an incredibly successful podcast and following, and so the pleasure is all mine.

So to start the show, like, I just find, like, what your track record is, like, really interesting. And, like, so to give the audience a little bit background is, like, you primarily worked in sales, like, in, like, Ecosign and then Zenefit and then Brex. And, like, throughout this journey, like, you have, like, kind of joined these companies with under 20 employees, and then all these companies become, like, hugely successful, either sold to another company. To start the show, I would love for you to share a bit more about, like, you know, how you got into sales. Like, you know, I know like your brother gave you a job in like the beginning of your career, but like you really ran so successfully. So I would love for you to share with us, like, you know, how do you kind of like started your sales journey also? Like, how do you grow up in general? Like what kind of like made you become this super driven person to succeed in the tech industry?

I grew up in Kansas City and I went to college at University of Missouri. And, you know, this is where there's a lot of things in my life that I'm very fortunate for. But one of those being that, as you referenced, my brother was in San Francisco. He was in technology sales when I graduated. And but for my brother Brian being in San Francisco, being in tech sales, neither of those things would have been on my radar at all. I probably would have moved to Chicago, which is the big city in the Midwest that a lot of folks from Missouri go to after graduation and maybe gotten into real estate. I don't know. Didn't know what I wanted to do. And again, just like very fortunate and sort of fell into tech sales in San Francisco. Driven by visiting my brother and seeing him realize a lot of success in the space. So I moved to San Francisco. This was late 2007, early 2008, and I was able to get a job at EchoSign. And again, I really have to attribute so much of this to just pure luck. I didn't know what to look for in terms of what good looked like. It was my first job out of college. I was joining as an SDR. I just wanted a job and I understood from my brother and the recruiter that was helping me find a job that this like category of SaaS— and again, this is back in late 2007— was a category that was like new and growing very quickly. And if you're going to get into tech sales, SaaS is sort of like the area to do it. And so that was a bit of my guidance. And I was just incredibly lucky that I landed at EchoSign and Jason Lemkin was our CEO who now leads Zaster, where I have the podcast that you referenced. SaaS or excuse me, EchoSign did quite well. I developed an amazing relationship with Jason and sort of like moving on to how I joined Zenefits. But once again, I was like very fortunate to have this mentor and relationship with Jason where when I was ready to leave EchoSign to become a VP of sales, he had this incredible network that he was able to tap into and introduce me to a bunch of different founders of startups. And through that process, I sort of developed a bar for what great looks like. And I talked to probably 20 different founder CEOs as part of this process of early-stage startups. And I remember the first time that I met Parker, we were at a coffee shop in the Mission and he just— it was so obvious that this guy and this business were different from the other, you know, 19 folks or whatever that I had previously met with. And so, you know, from our first meeting, I knew that this was the one that I wanted to be a part of. And part of that also was influenced by Jason's really positive signal. Like, you know, the company was raising a Series A at the time. It was very competitive. Jason was very bullish on Parker. And so, you know, I was fortunate to have that opportunity, fortunate to have Jason that was connecting me to all of these folks and fortunate to meet Parker at the right time. Was at Zenefits for about 2.5 years, did some consulting after Zenefits, and then was connected to Brex through Y Combinator. And at this stage in my career, so this would have been 2018, I would have been in tech sales for something like 10 years at this point. And at this stage, like my sort of barometer for what great looks like was a little bit more educated certainly than at the time that I had joined EchoSign, where it was like Whoever gives me a job offer, like, I'm probably taking that. And YC gave me the sort of pretext before I met with Pedro Henrique that this is the company that we are more excited about than any YC batch company that we've had in several years. And so that was, of course, like super positive signal. And they backed it up with making it the largest investment in YC history. And so they, of course, had the YC accelerator investment and they also had the YC content annuity investment at the time. And so I was very excited about the opportunity. And again, sort of like similar sentiment to when I met Parker, blown away by Pedro Enrique and the business that they were building and was very excited to join. Okay, fast forward to today where I'm now at Founders Fund. I've been here for about 7 months and I knew that I wanted to get into VC. I was very fortunate once again that I had through Brex's board and Parker and Jason so many connections to the space. And narrowed it down to a few different firms that I was speaking with. And, you know, when I met with Peter and when I met with Keith, again, like this experience where it was sort of like these guys and this firm, they are just different and different in such an incredibly positive way that I want to do whatever it takes to associate myself with these people in this firm. And so again, it was like similar to that experience where I joined Zenefits, met with a bunch of different early-stage founders, sort of like developed a bit of barometer for what seemed like a fit and what great looked like, and was extremely fortunate to be able to be sitting where I am today at Founders Fund.

Yeah, totally. I think what you've done is like extremely impressive. So like there's like a couple of things I kind of like have a question about. Like, so for example, you mentioned like, you know, at the beginning the connection was like from your brother or from Jason, like some people kind of like gave you these connections, but like to make them kind of gave you a chance or like helping you, it also requires effort like on your part. So like you have to, I guess, like, be that being like what you call it as lucky, you know, like not like, be that your brother, I guess, like everybody else help you because of, you know, who you are. So like, how do you kind of like establish this kind of network? And then also when I listen to your podcast, like, I feel like you're super connected with like every other CRO and like these like top startups or like unicorn startups. And like you were also like you know, even your frenemies would come on your podcast, like basically your previous competitors. And you're kind of like still having a close relationship with everybody. Like, so I'm curious, like, how do you kind of like build this network and then how do you kind of like maintain this level of network?

Yeah, I think maybe taking a bit of credit beyond a lot of the luck that influenced the businesses that I've been associated with, When I've had opportunities at EchoSign, at Zenefits, at Brex, and hopefully now at Founders Fund, I think I've done a good job of taking advantage of them. You know, EchoSign had a lot of sales reps and even a handful of sales leaders, which I ultimately formed or evolved into. And not everyone has this incredibly close relationship with Jason where he is really helping them. Myself and Brendan Cassidy, who is my boss, he was the VP of sales. I think are a bit unique in that regard and were unique in that regard. I would suggest because of the impact that we were able to have on the company. And so I sort of like had these opportunities. I took advantage of them. And in taking advantage of them, which I equate to like performance, I was able to perform. I found a career that aligned well with my skill sets and I was able to be good as an SDR, good as a sales rep, good as a sales manager and ultimately sales leader. And through that process or experience of having a big impact on these businesses, developed these relationships where Jason Parker, Pedro Enrique, all the folks that we referenced are, are, you know, happy to sort of like go out of their way and be an advocate for me. And you referenced a few folks as well. I think the same is true for the people that have really performed as part of organizations that I've been a part of. You know, Matt Plank is somebody that comes to mind who's now the CRO at Rippling. Matt was a sales rep with me at EchoSign, who I brought him on when I was a manager, and then I brought him to Zenefits with me and he just crushed it. Number 1 rep, you know, number 1 manager, now CRO at Rippling. And I hope to think that I have sort of like a similar impact on Matt and being an advocate for him. Jameson Young is another guy, similar story. He joined EchoSign as a manager. He joined Zenefits— excuse me, joined EchoSign when I was a manager, joined Zenefits with Matt as a sales rep. And now he leads the revenue function at Gong. And so it sort of like works both ways where I have folks that are more senior to me that I've reported to that have been incredible advocates for me throughout my career. And there are people that I've been fortunate to have on my team where they have just crushed it and I've hopefully been able to positively influence their career as well.

I feel like there's like 2 questions in mind is like, one is like, how do you become like the top salesperson as well as like the sales manager? I think that's kind of like 2 questions too, because I think, what do you think it's like sales intel? Like, I know it's like about like psychology or like how do you play like the mind game or like something like, so how do you kind of like improve this kind of skills? Because I think a lot of it were soft skills, like you're not going to learn it from like reading some books or something, right? Like, so how do you kind of like improve that? And then the other part is like, It seems like you are great, you're a great manager. It's like you are good at like identifying these talents as well as like kind of like training them because you don't really know what everybody want all the time. People don't really tell you like how do you kind of like sense how to kind of like motivate them and like, you know, I hear like from a podcast like you were saying like what separates a good salesperson or not. I'm curious like how do you overall improve these kind of soft skills?

I think there are skills that are sort of unlearned that can relate to sales and can probably relate to any different function. I imagine, you know, the best engineers in the world have some sort of like unique ability to be good as an engineer that is a little bit ingrained in who they are as a person. And, you know, sales is a little bit the same thing where there are personality types that likely align better in the function of sales than others. And so I think I'm fortunate in that I lucked into, again, finding a career path and a function that aligns well with my sort of like skills. And so because of that, I sort of like naturally gravitated to being a seller. I'm very competitive. I think that's like something that most successful salespeople have is sort of like a personality type. I would say like Type A/B personality, which means I enjoy being around people and I enjoy talking to and with people. But at the same time, I can also listen. And, you know, if I was just talking all of the time and sort of like not problem solving with what I was interpreting that people were saying to me, you don't want to be like too far on either end of that spectrum. And so again, I think sort of like the raw skills that I possess align well with being in sales. And then when you couple that, I've always had this mindset that I wanted to be the best. And this is a little bit of that, that like competitive spirit that I talked about. I want to be the best at anything that I do. And for me, the best is being number one. And anything less than being number one was at least interpreted by me as a bit of a failure. And so when I was an SDR, I wanted to be the number one SDR on the leaderboard. And when I was an AE, I wanted to be the number 1 AE on the leaderboard. And again, like anything else was a failure. And I think when you combine the sort of like natural skill set that is, is sort of like lends itself to being successful in sales with that like sort of hustle grind mindset, that sort of like whatever it takes to be the best, I think that is when you can have a really successful career in sales. And then your question was a two-part question. The second part was around managing salespeople and sort of like philosophically, how do I think about making, making those in an organization that I'm leading successful, something like that. The way that I think about it is my role is creating the infrastructure that sets people up for success. And I do that through a lot of strategy around, you know, what works, what is the way that we should position this product, what are the systems that we should have in place to enable salespeople to be most effective, what is the training that we provide that allows people to know which accounts to go after and knows how to pitch different products in different ways. And then you're sort of reactive to the way that individual contributors perform based on the sort of like structure infrastructure that we have provided. And different people need support in different areas. And so as a leader or as a sales manager, you're trying to provide the sort of like prescriptive support that each person needs that is unique to them outside of this environment that you've tried to create that is the sort of like structure that best enables one's success. And ultimately, I try and do all of these things that set people up for success. But ultimately, the success of people is on them. And the people that have been most successful have taken advantage of the opportunities that have been given to them the same way that I described what I was able to do at EchoSign and beyond. You know, we talked about Matt, we talked about Jameson. There are a couple of folks that Brex, Bobby Lukeman and Brandon Boyle and Ashley Kelly, who led SDR. These are people that when you put them in an environment where they are set up for success, they just crush it. Ultimately, the responsibility is on the individual to perform and it's on the sort of like leader to create the environment.

By leader creating an environment or like you mentioned about like the infrastructure and the system and training, how do you kind of create these kind of systems? And I think maybe we could just use like one example. When you joined Brex and like the company has like a placeholder website and then like less than $100 in sales and you build it up to, you know, several hundred millions of dollars in sales. Like, I'm curious, like through the journey, like, can you walk us through like when you join, like what kind of things did you do? And then in the middle when you were fast growing, what do you do? And then like in the end, what does a system or like infrastructure look like? Throughout this journey?

I would frame it as the outcome that as a sales leader and even as a salesperson that you are driving towards is very clearly defined. It's objective, it's driving revenue. And so for Brex, you know, it's either something like top line revenue or it's something like gross profit, depending on what, what makes more sense for the business. And from day one, I am trying to identify what the constraints to faster revenue growth or faster gross profit growth are. And generally on day one, where that constraint or bottleneck exists is around demand. And, you know, if we had more opportunities, we would be closing more revenue. This isn't universally true. But I would say like maybe 9 times out of 10, this is the bottleneck when you start. And for me, I just apply a lot of focus on sort of releasing that bottleneck and sort of like moving the bottleneck or constraint into a different area of the business. And so at Brex, we were very creative around demand gen tactics from day one, and we got to a point very quickly where reps' calendars were so packed with demos that they were saying, I can't take any more. Like, we've got to hire more people so that I can pass these leads that were being wasted because I don't have the ability to follow up with all of them. And then the bottleneck moves to, all right, we need to find some great people to hire. Over time, there were bottlenecks that existed around things like average deal size not being high enough. And so we wanted to be really thoughtful about at the top of the funnel, which accounts are we targeting that are going to generate the most revenue for the business? Because the ACVs in a certain type of companies were like 5x what the ACVs were in another type of company. And so you're just sort of like constantly problem solving for what is the constraint to us growing faster and applying pressure wherever that constraint exists. And so then the outcomes are things like, you know, we've got SDRs, we've got training on which accounts to go after and what message to send. And those are the things when I talk about infrastructure, it's somebody comes in, we know how to put demos on their calendar or instruct them how to put demos on their calendar.

We know how to win those deals and instruct them on how to win those deals and Let's say like a lot of our listeners are like maybe the founder that are selling the product themselves right now because they're just starting a company or like, yeah. So essentially they're still testing things out. Like, so in terms of like creating the first sale or like figuring out, like, let's say if they made like 2, 3 sales, but like they don't really know how to kind of like multiply that before they raise funding or like they raise like funding, like raise enough funding for to hire like a whole sales team. So curious, like at that stage, like how How would you— let's say, like, if you and I are running this company, like, how should we formulate some sort of, like, sales system or, like, you know, creating a repeatable sales funnel for us in a very early stage? How do we sell something? Like, how do we kind of, like, create a system for if we don't really have any?

First, and I did a post on this, I'll pin it on my Twitter if anybody wants to check it out. It's just like a short guide to founder-led sales. Uh, but I'll talk through some of the things that I mentioned. So first and foremost, find comfort in the fact that there's no one better in the world at acquiring your first set of customers than the founder. And that's because the founder is the most passionate about the business at this point. The founder understands the product and the vision better than anyone else in the world at this point. And if you as a founder are not able to acquire an initial set of customers, you should not expect that a salesperson is going to be able to. And so one sort of like pitfall that I see some founders making is like hiring a salesperson to bring on the first set of customers, when in reality you really should do that after you, the founder, have closed your initial set of customers so that there's a bit of a framework for how to do this and maybe some like confidence around product market fit. Then I would think about things in terms of taking the path of least resistance to getting revenue-generating customers onboarded. And that starts with creating opportunities. And where I have seen both founders and companies be successful is leveraging their network. Um, and so you as a founder, you may have prior colleagues from a company where you used to work. You may have investors, you may have friends. That work in companies in your target market. And just trying to leverage that network that you have to gain introductions and create opportunities is going to be more effective than sending like a cold outbound email to someone at a customer that you think is in your target market when you have no customers and maybe no website. So I like to go back to taking the path of least resistance, starting with talking to companies in your target market where you have some hopefully strong connection to the buyer or somebody within that business. And then I would focus on solving the problems of the people that you are selling to. So understand a little bit about the environment that you are selling into, sort of prescribe the way that you're going to solve someone's problem. Um, and again, sort of like take the path of least resistance to getting the deal done. And oftentimes that means sacrificing a bit on price. You take a set of design customers, you build for them for a period of time for free, and once you are delivering value for their business, then you can begin charging them. And, you know, you're sort of upfront about that, and maybe you give them a big discount for going on this journey with you of building the initial product.

I have a question on like the product set too, because like you join these companies when they have maybe 10 people or something. So like, or even I know that when you join, I believe Zenefit, when you guys have like less than 5 people. So at that stage, the company typically change a lot in terms of the product offerings. So how do you kind of sell when the product just instantly change? Like, you know, this week we don't really offer this anymore. We switch to something else. Or that never happened to you in terms of like the product changing?

Fortunately for me, the core product never changed at Zenefits or Brex. We constantly added feature functionality to our core product offering, but fortunately the company never went through sort of like a radical pivot into what we were offering. And also, and hopefully there's some version of this, maybe not to the extreme point of Zenefits and Brex, but when I joined Zenefits and when I joined Brex, Both of those businesses were YC companies and they were able to acquire customers that were their YC batchmates. Now, not everyone goes through an accelerator and not everyone has the target market of, you know, early-stage companies that may be in that accelerator with you. But most people have friends, former colleagues, former people they went to school with, and investors, some combination of those things that you can leverage in some way, sort of the way that Parker, Pedro, Enrique they did leveraging YC.

One of the questions is like, how do you kind of leverage the network? Or like, let's say like maybe you have two close friends that are working at your dream client company, but like the rest of them are your weak ties. Like, how do you kind of like turn the weak ties into your potential like evangelists or something? And like in terms of like you mentioned about like, you know, at the beginning, maybe talking to the target market, like, but like, what if you just create a product but you're not really able to identify what is the biggest sale that you will make? I guess like the target audience is not clear. How do you define that? Because, you know, Brax has been like having humongous success with like all these like tech startups. But like, let's say when you guys were trying to branch out, be set like the tech scene, like how do you identify like what would be the most profitable market to go into? And then how do you kind of quickly research that market to come up with a strategy?

Candidly, the sort of like 0 to 1 process where you're finding initial product market fit is one where I'm, I'm just less experienced and so probably would add less value around where most of my experience lies is we have some early product market fit and we're looking to sort of like pour gasoline onto the growth engine or something like that. That. And so then on the sort of like how to find product market fit, I may be less, I'm maybe not the right person to provide guidance there. Founders are generally scrappy or successful founders are generally scrappy. And to use a cliché, you miss 100% of the shots you don't take. So if you've got a loose connection on LinkedIn with somebody that is in your target market, that you got nothing to lose to reach out to them and to ask for, you know, either an introduction or if they would take the time to provide some feedback on this business that you're launching. I think oftentimes people are surprised with how others are willing to go out of their way to help, you know, founders that are starting off a business. And so I would just sort of like provide loose guidance that you should just and you might be surprised with the results of doing so. And then what if the target market is less clear? You know that there is a need for what you are building. You don't want to be too deliberate about who you are going after because there could be lots of folks that get value from this. I like the concept of just casting a wide net, and that can mean reaching out to people in a bunch of different verticals and positions or wherever you think that there could be a need. And over time, you'll just start to develop a little bit of sophistication around where the market pull is coming from. And we did that at Brex when we moved upmarket a bit. So we launched as the first corporate card for startups. We were very deliberate about who we were selling to, but when we moved upmarket, we weren't totally sure where the need for this business would come from. And, you know, there are these, there are these sort of random categories of companies. Electricians is one of them where, you know, we just cast this really wide net. We were reaching out to lots of people that could see value. And surprisingly, like, electricians put a lot of money on their credit cards. They're buying all of the electrical equipment to run their business and they sort of run their business operationally through their credit card. And so a bunch of these electricians were applying to us and they're spending a bunch of money on card, which made a bunch of money for Brex. And all of a sudden we've got a bunch of people going after electricians that we wouldn't have done had we not taken this sort of like cast a wide net approach. And so that's, that's how I would think about it, just sort of like see where the market pull is coming from, cast a wide net. And, you know, you may be surprised at where you're getting a lot of traction.

Similar to what you just mentioned, like, you know, you kind of find some sort of traction, but like you didn't, you didn't find the electrician part or whichever is like the most profitable. How do you kind of like build up a system to repeat what's working?

The thing that immediately comes to mind is maybe not that impactful, which is just when something works, just double down on it and keep investing in the things that seem to be working. I'll give maybe one tactical example. When you acquire a customer that is in a specific category or segment, do whatever you can to leverage that customer. And what I mean by that is, number one, you can ask them, do you know anyone else that would realize similar values or similar value to this service the way that you are? And you may receive some referrals. So the first thing is like, you know, try and leverage the customer that you do have to generate more customers as a bit of like a demand gen source. And then I would reach out to companies with similar dynamics. So if you have a customer that is an early stage tech startup that has, you know, competitors that are X, Y, and Z, reach out to X, Y, and Z. And, you know, say these folks are leveraging our platform to accomplish this value. And I think we can realize something similar with you all.

I'd love to talk about how Would you focus more on like retaining this customer than like going out there to cold call everybody else? Or I know that you mentioned about similar things on podcasts, but like, you know, like when you guys add more AE or add more salespeople, sometimes like the result doesn't really double or anything. So I'm curious, like, what's your thinking process on like getting the worm leads or like retaining the people who are already in your ecosystem versus outbound to like go there, get more?

If the balance is do we make a customer happy or do we go try and find another customer at the expense of customer happiness? You know, I would solve for customer happiness first because that will ultimately lead to a more long-term successful business. And ultimately like tailwinds around acquiring new customers when you have happy customers. So first solve for making the customers have this sort of like delightful experience and being really happy and then try and leverage those happy customers into acquiring more.

So you mentioned about demand gen, like what are some ways for like a startup to do, to do so? Is that like more related to the marketing or like putting a lot of content out there, or is this more like We go there and then cold emailing everybody.

There's not necessarily a playbook to how to do this for an early stage startup. And so the way that I would approach it is come up with ideas, try different ideas, see what works for you, double down on those ideas. And so, you know, the different categories, some folks are really effective at social media and they have founders with like a big presence and, you know, that may or may not work for your business. And then And at Brex, we tried a bunch of stuff. We did events and we were creative with customer acquisition at events and we sent founders bottles of champagne and congratulated them on their fundraise. We did something that's like kind of expensive with billboards and the billboards were really effective. We did a ton of outbound and hired AEs and SDRs with the expectation that they were going to generate opportunities through outbound and we got creative with messaging and a lot of the stuff that we tried worked and some of the stuff that we tried didn't work. And so you sort of double down on the things that are working, but you got to be willing to throw stuff against the wall and willing to fail, chalk the failures up as a learning. And, you know, you sort of move on to something that is more effective for your business.

So now you're an investor. So throughout your amazing sales experience, like, how do you translate all the sales experience into investing? And like, also another question is like, you know, there there's a lot of amazing sales leaders out there, but like you really stand out as like, you know, you joined one of the top funds and then you have previously made like over 20 angel investments. You were advising companies like Flexport. Like, I'm curious, like, how do you kind of enter the angel investing journey and then how do you leverage your knowledge in sales to pick the best companies?

So I was at Brex for a little over 4 years and it was an incredible experience. And for the first time in my career, I felt satisfied with what I had accomplished in this, like, category of being a sales leader. And, and generally, um, what I would equate that with is, like, a loss of motivation. And so I wasn't super motivated to go join an earlier stage startup, lead a revenue function, and sort of, like, do it again. And I knew that I needed, like, a new challenge. Again, I've referenced my brother a couple of times. My brother was a CRO at a tech company. He joined a VC firm named Sutter Hill. He was there for about 5 years and just recently left and joined Human Capital. And so I'd seen my brother who, you know, I originally moved out to San Francisco in large part due to in the first place. I had seen him make this transition into VC and be quite successful at doing it. And so that gave me a bit of inspiration to sort of see what that would look like for myself. And you referenced that I had made a number of angel investments. I found myself just doing this as a hobby. I really enjoyed meeting with, evaluating, investing in, and then helping mostly founders on the angel investing side. And, you know, I found myself towards the end of Brex spending like a decent amount of time doing this as a hobby. And I think that that was really positive signal to signal to me that I enjoy this. I think like my bar for delineating amazing from good or something like that became pretty sophisticated through the angel investing experience. And like, you know, maybe I could be good at this. And there is an element of sales when it comes to investing now that— and less so on the angel side, but now that I'm at Founders Fund, for the companies that are doing quite well, the deals can be very competitive. Competitive. And having a bit of a sales background gives me an advantage in winning a competitive deal. I'm new to this and I acknowledge the value that I can provide as an investor. And so I really try and leverage that when trying to win a competitive deal. But a lot of it is sort of like picking the right ones to invest in as well.

How do you pick the deals that you want to invest in? Maybe we can use a particular deal that you've done before. So I saw on Crown Launchbase. You invest in a company called Superblock, which is a developer tool. There's like a company called Casual, which is like an Excel killer. Like, maybe we could pick any, like, any of these two, or like, like maybe some other companies that you have invested in. Can you walk us through, like, when you meet the founder, like, how do you meet them, and then what do you see in the company, and how did you feel like, you know, you could like leverage what you have to like help this company succeed?

I, I think There's a big difference with the way that I approached angel investing and the way that I'm approaching investing at Founders Fund and investing LP dollars versus my own capital. When I was angel investing, I didn't have time to sort of deeply diligence a deal. I did almost 30 angel investments over the course of 2 or 3 years. And so my diligence was really just like, you know, 1, maybe 2 30-minute 10-minute Zoom calls with the founder. Do I like the business idea? Do I like the founder? And if yes, I would love to, you know, angel invest and be a part of the business in some small way. At Founders Fund, the level of scrutiny that I need to put on investments that I make is just far greater. So, you know, I meet with founders many times, develop a close relationship and there's, there's a bit of me deciding, can this be a generational company? A bit the way that I believed Zenefits, which I think now sort of manifests through Rippling, the way that I believed that about Parker and Zenefits and the way that I believed that about Pedro Enrique and Brex. And on the other end, there's some diligence of me, of course, as well, where they're trying to find out, is this the right fit for what we need as a business? And the skill set that I bring is really de-risking go-to-market and scaling revenue. And so if that's the sort of complementary skill set that is most applicable to the founder and to the business at this point of time, it's, you know, maybe a bit of match made in heaven, but it is very different from angel investing, I think, on both sides.

What are some characteristics that make you feel like they're a generational company?

There are two things that I focus on. You hear a lot about the first and maybe less about about the second. Um, but the first one is that the, the founder— I, I've been extremely fortunate to work with a category of founders in Jason, Parker, Pedro, and Enrique, um, that I have a group of folks to compare and contrast the founders that I'm meeting with to. And do I believe that this founder is going to build a generational company? And, and, you know, I sort compare and contrast on a number of different things. Things like intensity is something that I gravitate towards, intelligence of course, and more. So I think solving for the founder is a big part of it. And the thing that actually, especially on the early stage, you hear investors talk less about is the business model. And when I talked to Parker about Zenefits, when I talked to Pedro Enrique about Brex, I was sort of blown away with the ingenuity of the business that they were building, which I think was a bit of a signal on the quality of the founder. I think really incredible founders identify market opportunities and go after them. And for each, Zenefits and Brex, they were building sort of monopoly businesses. Zenefits was the first tech business that monetized as a health insurance broker and provided this incredible software for for free. Now there's a bunch that are doing this, and Brex was the first corporate card for startups. But, um, really there was this financial engineering around underwriting businesses based on their cash balance and not based on, uh, the creditworthiness of the founder. And doing some diligence on that business model, it just came back with like, that's genius, why hasn't this been done before? Um, and so I am looking for like, you know, founder quality, but also sort of like monopoly characteristics of a business, um, or just like quality of business model. And from there, if both of those two things are exceptional, I want in.

I really like what you said about like basically, basically these two kind of companies are, they invented a category before the category kind of exists. So they made some like really huge change in the industry they were previously in. I'm curious, like when you were thinking about these mega trends in terms of investing, so like this year we see like generative AI become the thing. And then last year it was like, you know, Web3 and then before it was crypto. NFT, and then there was AR, VR. I'm curious, like, in terms of investing in bigger trends, what's your, what's your thought on that? Do you feel like people have to be really early onto a trend, or like, do you feel like those are not something that you look for when you are investing?

It's a good question, one that I don't have an incredibly sophisticated answer to. The way that I think about investing personally, for me, is that I should stick to where I have the most experience. And if I sort of map my career from EchoSign, Zenefits, and Brex, which is where I spent most of my career, those are very different categories of companies. Brex is a fintech company offering corporate cards and bank accounts and expense management software. Zenefits, as we've described, is, is this health insurance broker with payroll and HRS and more. And EchoSign is an electronic signature company. The thing that's consistent with those businesses is that they're all enterprise software. They're all B2B technology companies in very different categories. And so for me, that's really where I'm spending most of my time is technology businesses that are selling to other businesses in a bit sort of like category or trend agnostic, the same way that like those 3 businesses represent different trends and points in time and more.

How do you educate yourself quickly in that industry to become an expert before you start selling them or like before you start investing in these companies?

Yeah, fortunately for me, the services and technology that each of those businesses are providing are pretty straightforward. It's not like highly technical or complex that I need to learn an entirely new industry that I have no experience experience in. And so when I joined both Zenefits and Brex, the diligence that I did was speaking with people in their target market and identifying if this is a real problem and the sort of strength of product-market fit. I'll give a tactical example. When I was interviewing at Brex, I had one interview and the first person that I called was Parker, and Parker had just recently started Rippling. And I Hey, interviewing with this company, they've got like, you know, corporate card expense management. Their big wedge is that they issue true credit cards that are underwritten based on the cash balance that a company, in this case a startup, has in their bank account. Is this like a real problem? And do you think like, you know, would you be interested in something like this? And his reaction was like, man, Man, at Zenovitz, this was a huge pain. Um, like, we had debit cards until we had like $50 million in the bank and several million dollars of ARR because it was all tied to my personal guarantee, and I didn't want to do it for different reasons. And so we had like this SVB debit card that people were running around with. If that was available, like, that's a brainer. And even founders that could get big credit limits on their own personal credit limit, they were all like, yeah, I hate this because it's tied to my personal credit score and it's a business card. And like that association, it doesn't really make sense. And so again, just like quickly pressure testing through some diligence calls with customers or potential customers is how I gained conviction around the businesses at a very early stage.

For the same philosophy of like, you know, chatting with potential customers the same way you apply to your investing, like, so in terms of investing in the next Brex or the next Zenefit, like, do you use the same framework to do due diligence?

The best framework that I have come up with, and maybe this matures over time, is would I join this company and lead the revenue function? And I think if I keep that as the sort of like barometer then that's a great place to start. Now, like, Zenefits outcome was sort of like negative and certainly for investors, not the outcome— investors and employees— not the outcome we had hoped for. That said, you know, Rippling is a bit of Zenefits 2.0. And so I think the decision to join Parker, who's just like an unbelievable visionary founder CEO, and the business that he was building was the right one. It's just like, you know, the outcome wasn't what we had hoped for. And certainly with Brex, it's most recently marked at $12.5 billion and hopefully just getting started. So that's like my personal bar is does this founder and does this business meet the bar for me joining as a revenue leader? And if yes, like, please take my money.

I love that. Okay, so we're at the last part of the interview. I have a mini fire round for you.

Let's do it.

Yeah, perfect. So my first question is like, what's your favorite book?

I like Principles by Ray Dalio.

Who made the biggest impact in your life?

Shout out to my parents. I had like an unbelievable upbringing and, you know, so much of what I know today is wisdom that they imparted on me. You know, we've referenced my brother a number of times on this call and then folks throughout my career that have just been huge huge advocates for me personally and close friends like Jason and Parker and Pedro and Enrique, uh, and others. But, um, those are the folks that come to mind.

Who would you invite to your dinner party?

Every time today that I meet with, uh, Peter, um, whether it's one-on-one or in a group setting, I'm sort of blown away with, uh, the, the, like, knowledge that he imparts in, in the way that he sort of views the world. So Peter's at the top of the list. Some of the other folks that I mentioned when you the prior question around, uh, who, who has been like, you know, most inspirational throughout your life, they're, they're on the list as well. Um, and then probably some, some close friends too.

Amazing. So where can we find you outside of work?

I moved to Miami in late 2021, and, uh, I really enjoy living here. And I enjoy living here, um, both because the weather is amazing and you're surrounded by water. And even on the West Coast, when I was coastal, I never really took advantage of the water itself. And in Miami, you can just do lots of water activities like going boating and efoiling and so, so many activities on the water and at the beach and amazing restaurants here. And so social activities. But I do spend a lot of my time focused on work, whether or not it's like inside the four walls of the office.

That's amazing. So last, last question is, if you're angel investing in a company today, which company or what type of product would you put your money in?

I like to invest in businesses that have the aspirations to become one of the largest companies in the world. And I remember when I met with Parker for the first time in this coffee shop in the the mission that I referenced previously, he said to me that he's good, that Zenefits is going to be a $100 billion business. And of course, like the outcome there wasn't that, but Rippling is going to be. And when I met with Pedro and Enrique in San Francisco, the Wi-Fi password that was on the table said Buy Amex 2024. This was back in 2018 in this like awful office on Market Street in San Francisco. That it like hadn't been updated in probably 40 years. And so like, you know, they were crazy, like buy American Express, the largest businesses in the world in 2024, which was 6 years from the time that I was sitting at that table, just the, the like the ambition and aspirations to build the largest businesses in the world and like the belief that they could actually accomplish that is what I was gravitated to, or I gravitated towards, and what I gravitate towards today. And so as I mentioned before, I'm a little bit sort of like category agnostic, but I want to be associated with people that build the biggest businesses in the world and have the ambitions to do so.

Love it. Thank you so much, Sam, for coming on the show. That's such a good note to end on.

Grace, this was awesome. Thank you for having me. It's been awesome to talk with you today.

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