How the smartest founders are winning in AI

Now 0 to 1 is very likely in AI. You build an incredible tool that no one else can do. You can do a million in a week or two.

You know, okay, so for this episode, what I'm thinking this is about is this is sort of, um, and guys, this is going to be generous to us, but what is the smart money doing with AI? And, you know, in betting and sports betting in Vegas, you always kind of want to watch what are the sharps doing? They tend to be just, you know, maybe 10 or 15% earlier to, to understanding things or to recognizing things. And so similarly, uh, Jason, I wanted you on because you've been doing really interesting stuff with AI, both from investing, you're talking to startups that are using them, you're reading all the reports, but also you yourself built this AI tool. And so I want to kind of get your reaction to a few of the different things. Can you first explain this AI experiment you did where you basically made a body double of yourself out of AI? And like, what was the experiment and what'd you learn?

Well, yeah, so, so Saastr has a lot of content. As you guys know, we have 12 years of content. Some of it's out of date, right? For, for sure.

Saastr being, um, you're a previous founder who's exited multiple software companies. Now you're like the godfather of like SaaS because you have this blog and media company and events business called Saastr and you have a huge fund. So that's kind of the—

but probably most interestingly for, for like seeing the future a little bit is I have about 10,000 pieces of content I've written over the years, a lot of it which is not out of date, and I update it personally. So about 10,000 pieces of content. And then we have several thousand interviews like you guys do, but with so many great folks. Early ones with Dharmesh, middle ones from Dharmesh, Dharmesh when, when HubSpot had just IPO'd, Dharmesh the other day, Yamini last week, Brian Halligan over the years. And we have all of it. And our AI took everything I've written, every tweet I've ever done, every LinkedIn post, every SaaStr video from every speaker for 12 years. Aaron Levy the week he went IPO for the first Astro Annual to last week when we were talking about AI, all of it ingested in this AI. And so what I instantly saw was as soon as I would talk to this AI, it was much better than me. It was much better than me because I forget—

how did you get that information in there?

You just hook up RSS, right? Um, the feed for blog. It can scrape the web, which is pretty easy. Soon we'll be able to do other things like MCB, but it's just scraping APIs and RSS. It's really just scraping. You just give a URL.

But did you use like Delphi or you, you built your own tool or what'd you do?

I tried a couple things and then I used Delphi. And then at first we had so much content, it was a little difficult to ingest it. So there is, there is a little bit of work. And then I spend about 10 minutes a day training it, which we could talk about. So there is a little bit of maintenance involved, but it's better than me. And the thing I didn't get until I saw something that was hyper-trained, like, 'cause this is a lot of content, 20 million words, right? Very few mistakes, very few hallucinations, and the ability to connect things that I can't. I just don't remember. I don't remember what Sam and I said on The Hustle on stage years ago versus when we did an MFM a while versus today. But the AI knows it all.

By the way, 20 million words is like 200 books worth of content. An average book, I think, is like 100,000 words. So 20 million words, you're saying, is you basically gave it 20— 200 books of your own brain, uh, and the brains of other guests that have come on your show.

Yes.

And your goal was build— was it to build basically an advisor, an AI version of you that could be an advisor to a founder who wants to come and talk to you or ask questions, but you don't have enough time of the day to book calls? Was that the big idea here?

Well, no, I just wanted to learn like you guys did. I just wanted to learn. I didn't think it would be as good as it was because I used other products and I've used other things and it wasn't as good as my, my digital AI was. It wasn't the same.

But the use case would be what? Is it what I said or is it something else?

The other interesting thing is the use cases with AI are much broader than you'd expect. Okay, so I didn't expect people to upload their board decks before board meetings and ask for feedback before a board meeting. That's a niche use case. I didn't expect hundreds and hundreds of founders to use it as their therapist for their company where the growth has slowed. I didn't expect that. I didn't expect so many folks to use it to review their, um, sales scripts, their SDI scripts, when there's, when there's specific tools to do it, right? I didn't expect It's so good at reviewing VC pitch decks. It's so good at it. Better than anything I've seen.

Can you get tactical for one second? So you go to delphi.ai and you just uploaded the Sasters RSS feed and it did all of the work.

YouTube, RSS, Twitter, blog, blog.

But, but could I go to a health guru or a business guru who I subscribe to, who I love? Can I say youtube.com/alexhermosi, upload that, and it automatically does it? Is this—

Well, it's an interesting question. It is prohibited, right? It is prohibited by their website, their terms of use. They prohibit it. But honestly, this is an AI risk. You could, you could do it. Absolutely. You could do it. You could redo what I did. It might take you a little while longer, but you could just clone exactly myself, yourself. And then you would, you could do it just as well as I did.

Sam, I've never felt so used and abused when, uh, Jess Ma came on the podcast and she was like, yeah, actually, uh, I have my team training an AI of you so that if I'm brainstorming ideas, I don't have to ever call you. I'll just ask the AI what, you know, basically you'll just be in the meeting with us.

Yeah.

She's like, we, yeah, we just took all the podcasts and we're training it on how you think, the questions you would ask, what you would say, reactions you would give, and now you're just there in the meeting. So she basically hired me without ever paying me, right? Because I have this corpus of content. Out there. I've actually put my brain out there in the public.

But how do I do that? Like, how— it can't— can I just upload a YouTube channel and say this YouTube creator has great advice and I could upload 800 videos and it will transcribe all of them? I could go to Delphi.

It may take a day or two to fully ingest all that content, but it will do it just from the URL of your YouTube.

Just on delphi.ai. So I could, I could make a mini show.

I actually, I think it is a great product. There are other people that can do it too. That is not— there are some, I'll tell you what I think is interesting about Delphi, but we're looking at all this Cursor and Windsurf stuff and Lovable and like, you don't realize like they're just so far ahead of like B2B and regular people only because they're better people working on them. If we had the quality of people working at Windsurf working on, on CRM, okay, or working on marketing tools or podcasting tools, your jaw would drop today. But this is why your jaw's gonna drop over the next 24 months because just mediocre engineers cannot— like the, the engineers at OpenAI are so good. They're just so good. And so, but the average engineer working at a struggling CRM, right, is just not, just not that, that good. But they'll catch up. But yeah, you can build all of this. And here's the interesting learning. So we could build a digital Sam and we could do this for next week or whatever. You can do it. My learning from my AI, it's okay that it's not you. This is why, for example, you can train your voice. It uses, uh, Level 11. Is that the product or— I get a little confused. Level 11, right? Yeah. Level 11. ElevenLabs. Yeah. ElevenLabs. And ElevenLabs is epic, right? But you can choose, do you want it to be exactly like you, which is what Brian Halligan did. And then I realized that was creepy. I don't want Digital Jason to be me. I want Digital Jason to be a prime version of me that 90% of the time is much better than me, but is distinct. I don't want people confused like Brian. I get confused like Brian Halligan. And so, um, it's okay that it's not Sam. Like it could be a version of Sam that is better than Sam.

Alright, a few episodes ago I talked about something and I got thousands of messages asking me to go deeper and to explain, and that's what I'm about to do. So I told you guys how I use ChatGPT as a life coach or a thought partner. And what I did was I uploaded all types of amazing information. So I uploaded my personal finances, my net worth, my goals, different books that I like, issues going on in my personal life and businesses. I uploaded so much information. And so the output is that I have this GPT that I can ask questions that I'm having issues with in my life. Like, how should I respond to this email? What's the right decision knowing that you know my goals for the future? Things like that. And so I worked with HubSpot to put together a step-by-step process showing the audience, showing you the software that I used to make this, the information that I had ChatGPT ask me, all this stuff. So it's super easy for you to use and Like I said, I use this like 10 or 20 times a day. It's literally changed my life. And so if you want that, it's free. There's a link below. Just click it, enter your email, and we will send you everything you need to know to set this up in just about 20 minutes. And I'll show you how I use it again, 10 to 20 times a day. Um, all right. So check it out. The link is below in the description. Back to the episode.

So, okay, let's walk, let's walk through these top 10 learnings. So you build this AI, uh, it has 35,000 conversations with people. You did it as a experiment.

We're like almost 50 now.

You have 50,000 conversations and learning number 1, you said users will tell AI things that they won't tell humans.

What do you mean? Yeah. Um, well, first of all, before we can get there, one obvious, like, there's no way I could do 50,000 conversations, is there?

Right.

I'm not even a people person. I could do like 1 or 2 a day and I get tired. 50,000. Just think about the delta between 2 a day and 50,000. But yeah, this is the thing, like. There are some things that are somewhat unique about me that are early. The amount of content— Sean, like your math, right? The amount of books we're talking about here, right? The amount of content I've written just about B2B, just about biz building, business software. It's interesting. The other thing is there's enough people— I'm not like a super influencer like you guys are, but there's enough people that know the digital me that they already know what to ask me, right? They've already watched me in an event. They've read the content. So like, they ask me things without thinking it's a prompt or prompted. They just ask things. They want to talk about their deepest fears. Like, I've partnered with Sam on this podcast, but I'm not sure he's committed as me. I see him doing other things. He's into this accounting software and this Hamptons thing. I'm worried he'll quit my podcast on me. What do I do? And my AI is really good with talking that through you, right? And so people just think to ask anything.

How does he know all this, Sam?

Hey, Jason.

Whoa, close to the heart there, Jason.

You think it's funny, but like you might ask Jason.

Jason, how about you shut up?

Well, now you— but there are thousands of these types of conversations. My co-founder is not as committed. My, I don't know if my board's going to fire me, right? I, is, is, I'm only growing 18%. I have 11 months of runway, right?

Were you Zuckerberging here? How'd you know what they were saying? Was there some privacy here? How do you know what's, what's being said?

It is interesting. And on this app, you can set how much privacy you want. You can anonymize everything.

No, you can.

No, because there's different use cases. If you're using it as a support tool, think about it using it as a support tool. You don't want anonymity for support. How can you follow up with someone? Right, right. Then there's like a therapy level where you would want true anonymity. And then there's like a— everything's a slider in AI in a sense, right?

I think that like you said the therapy thing as if it's like, can you believe that? And I'm like, dude, I use OpenAI ChatGPT for therapy 3 hours a day.

Yeah, well, everyone does.

Like the majority of— I'm like, this email pissed me off. How do I reply in a graceful way? Or like, I argued with my wife or I'm upset about that I'm not doing this. Like, like the other day on Sunday, I saw someone who had a super fancy home and I was like, how do I get over envy? You know what I mean? Like, like that's all I use it for.

It is. And this is the same thing. It's just because it's got the 20 million words for business to business content, sales content, scaling revenue. It's, it turns out this, and this was a surprise to me. I didn't believe this. It's better, much better than ChatGPT. It's much better.

And you, you, you said something like you trained it afterwards. Can you just, what do you, what do you mean by that? Well, how did you train it afterwards?

Well, listen, I'm gonna embarrass myself technically. Okay. But basically those 20,000 words, it, you basically RAG it. Okay.

You vectorize 20 million, 20 million or 25 million words of my content.

You turn it into a, a, a very, a database instead of, and, and you just add that to ChatGPT or Claude or DeepSync. And the way you add it and the relative weights of my content versus the generic content radically changes the output. Like ChatGPT never asked my permission. It's already slurped up all my content, hasn't it? Every single YouTube is in ChatGPT, everything I've written. I haven't been paid a nickel. So what's interesting is that content's already there, but by weight, by heavily weighting it toward my content for my type of knowledge, it's much, it's not a little bit better than ChatGPT. It's like much better. Right? Got it. How do I just, how do I create a sales comp plan? I have 4 SDRs and 5 AEs. Uh, our, our average deal size is $2K a year and we want to go from $2 million to $6 million next year. And, and my team won't really do outbound. ChatGPT is gonna give you a very mediocre answer, but my AI is gonna give you insanely good answers even though overall we're pulling from the same content. Right.

And so you, you had to do that manually. Was that the training or did you do more? Did you do more training than just that?

Well, first of all, it auto-updates every day, which is better than ChatGPT or Claude. It auto-updates every day. It slurps up everything on my blog, on my social media, on my YouTube every single day. It does it essentially almost in real time. Okay. And then yeah, you, it does it itself. It auto-updates. Now what I do do, here's what I do do is, and I'll tell you my learnings on like hallucinations. Okay. I audit a few of them. I read some. And I see if they're wrong, right? I see if the ones that are, that are not anonymous, if they're wrong. And when I see something that's wrong and I'll tell you what I learned, if you're interested, then I— there's a section where I just train it, right? And I say, no, Sam and I first met in 2016 after I wrote a Quora post and he had me do a meetup at The Hustle. Okay. Because it got it wrong and made something up. Okay. So I do, I do that for about 10 or 15 minutes a day. And it turns out it doesn't get very many things wrong. And the things it does, it consistently gets wrong. And I'll tell you why. And then I just fix it. And the next day it's right. The ne— if you do nothing and you don't train it and you put no content in, yeah, this, this, this average VP of sales is gonna say, eh, it doesn't work. You know, I, I, I logged into ChatGPT a year ago and it hallucinated. And like, you're gonna lose your job.

But the hard, the hard part here is like, so I'm so committed to ChatGPT, so it, it, it knows so much of my information because we've had so many conversations.

It does.

Are we all gonna have like files, you know, like our health record where it's like, uh, you know, my, the background? Because it sounds like I get nervous to switch to any other model because I'm like, uh, ChatGPT, I've already asked it so many questions, it already knows everything.

It's an interesting question. Here's what I've learned. First of all, memory's a big deal, right? ChatGPT could already remember questions, but now it's remembering everything. Okay. So, so it's a moat from the top folks I've worked with on this. There's, on the one hand, it's a, it's a moat just like Being in the Google ecosystem is a moat, just like back being back in the day, being in the Yahoo ecosystem was a moat. Okay. But the moat is not as deep as we think. Our ability to get, to get trained and up to speed does not require 20 million words. So yes, it is a moat, but if you decided Claude was much better for you and you, the point is, and you spent a month just including your day each day, you, you're probably there. You're not, not 100%. It's enough. It doesn't need to be—

Somebody had a good startup idea. Uh, I think it was Aaron Levy or some, somebody was tweeting this. They, they were talking about Plaid for AI tools. So basically you'd be able to just like, the way Plaid lets you connect your bank safely to any financial service, to be able to take your kind of memory and context, what, what ChatGPT knows about you, but port that to some new app that you're trying without, without handing over everything, but allow it to pull from that. And I was like, oh, that's a, that's actually a very interesting idea.

If apps will even exist in the future.

Well, what will exist instead of apps?

Why? We're going through a transition phase, right? We're going through— now we're chatting once again. We've been chatting since the ICQ days, okay? Since AOL. We've been chatting at our keyboards. With people. Now with AI, we're chatting again. Okay. Uh, but we're starting to not even know where we're chatting with, right? Right now already, like MCP is new, but already today OpenAI and Claude can pull from other apps like HubSpot and others and, and Notion and just pull the data out. And I don't have to go to Notion or even Google Calendar or HubSpot anymore. Right?

Right.

As we live in this, and then, you know, people think this Johnny Ive thing for $6 billion is crazy. It's a great bet. Because we're going to go from 20 minutes a day, 22 minutes a day in ChatGPT to 24 hours a day in ChatGPT. And when we're in ChatGPT 24 hours a day, we're not going to like pull up a CRM. We're not going to use the interfaces. Like these interfaces are all already dying. You can see it, Sam, in the amount of time you spend in GPT. Like then go to like a B2B app. You're pulling your hair out. It's so dated, isn't it? Yeah, it's so dated already. It's only 2025 and it's already dated to go to any B2B app. They're all going to die.

How does the excitement and rate of change right now compare to— I don't remember if you were involved in '99 and the year 2000, but you were close, right?

Yeah, I was a kid. It was my first job back then.

Yeah. So how's that? Because everyone talks about the dot-com boom and I, I never got to— I mean, I never experienced it, but how's this? How's this today compared to then?

Those days were the first time until I— where people feel like they could just do something out of nothing. Like it was miraculous. It was miraculous. And that is what AI is like today. People are just doing miraculous things and it's exciting. But man, it's super scary for incumbents. It's super scary for incumbents.

Do you think that everybody who is maybe a content creator at least, um, is going to have this sort of like the stunt double, this, this intellectual stunt double, the way that you created here? Do you see it once you've did this experiment? Are you like, this is the future or this was novel, but no, I don't think it's going to last. Like, you know, where, where's your, where did you land after the experiment?

I, well, first of all, what I think, I'm not a consumer content creator. I don't think anyone is gonna create content without AI going forward. And the tools are gonna change. Um, like for example, just for, for our last big SaaStr event, like I did all this speaker promos in Higgsfield. Have you ever used Higgsfield?

No.

It's incredible.

How do you spell that?

Higgsfield.ai. It's the ex-head of AI from Snap. It's one of the coolest apps on planet Earth. Everyone's talking about this new Google video thing, right? But they were already doing it. Higgsfield.ai. All you have to do to Higgsfield.ai. Is I can take a screenshot of us right now. I'll put it in Higgsville and it will create a movie out of it. Okay. And it will, and you can, and there's a lot of different ways, but there's a really simple way you can do it. You can take an initial photo and an end photo and it will just connect them with the narrative. So I had like, I would take like a picture of Yamini just off her headshot off HubSpot and then take a picture of like a stage at Saastr and it would just make a video of, of Yamini waving to the crowd and running on stage on Saastr and being excited. And so a year ago, all the, all the digital promos were a static, you know, a classic static headshot with some chrome around it. Today, everyone got a video, a really cool video, right? Next year it will be me and Yamini talking for 10 minutes about AI, and neither of us will have had the conversation. It doesn't mean I won't exist, but of course that's already come. We could already almost do that. But I did all these things. Now I did, instead of waiting for our designer 2 months to do a static, thing and upload it to Dropbox and me forget where it was and lose the URL and have to do it. Now I just did it myself in Higgsfield in like 10 seconds.

So I'm looking at Higgsfield. This is, this is insane.

It's beyond cool. It's so good. So good. This is the, this is why AI is exciting because the really badass people can do crazy stuff now. It used to take a badass person like 6 months to do a prototype and then 2 years to get it good. Now someone epic like the ex-head of AI in Snap can like, What you can do at Higgsfield will blow your mind, right?

Dude, I can even tell just by the way you're talking. I feel like if we did the same podcast, you know, 5 years ago, your rate of talking would have been like 10 beats per minute lower.

Even 12 months ago.

There's a baseline level of excitement that has just risen. Like our new blood pressure is here.

Well, as long as I've known Jason, you were borderline grumpy. Like you were pissed. You were pissed off all the time. Me? Like, yeah, yeah, yeah, yeah. You were like, look, like I remember you, you weren't tired, but you were, you were tired of people asking you dumb shit because you always had this, you had this energy of you where you were like talking to someone and you're like, you're making a mistake. Stop this. You're making a mistake. You had like this, like almost anger in you. Now it's the exact opposite. Now you're, you're optimistic.

I am.

I am.

You're right. I, I'd like to think of it differently, but you're probably right. The way you perceive me is, is important. Um, it is. I am very optimistic about it. But the difference is I used to think all these products were durable, that they were durable. Now I don't think any of them are durable.

So what's that mean?

When I first started doing this SaaS content, I made up this expression, which I stole from the mayor of Tel Aviv, and people have used it ever since. Zero to $1 million in revenue, impossible. We don't need another product. Okay. $1 to $10 million in revenue, unlikely. Like there's so much competition. $10 to $100 million, inevitable. From impossible to inevitable. We had a book that sold a couple hundred thousand copies. That was this theme. So you go this stage because What I learned as a B2B founder is once—

So you're saying getting from 0 to 1 million is really, really hard.

Yeah.

Getting from 1 to 10 feels impossible, but once you're at 10—

Unlikely. Yeah.

Unlikely. But once you get to 10, it's inevitable to get to 100.

If you had good founders, it was a punch card. Now it's disrupted. Now 0 to 1 is very likely in AI. Like, it's like you build an incredible tool that no one else can do. You can do 1 million in a week or 2. But like, now everyone beyond 100 million is getting disrupted. There's so many software companies at 100 to 200 to 300 million in revenue that aren't growing anymore. It never used to happen 4 or 5 years ago. Like you hit your punch card, you had 120% revenue retention and you had a brand. All you needed was a brand and revenue retention and products changing about every 5 years.

Right.

If the product changed every 5 years and you had a brand and tens of millions of revenue, that mean you had, meant you had product market fit, right? High revenue, like high NRR meant it kept going as an engine. And this, this 120, 130%, revenue retention, and you just kept going. It took you from 20 to 30 to 50 to 100. And it was like, and that's why, you know, in, in, in, you know, this crazy in 2021, 2021, the average public SaaS company traded at 70x ARR public in 2021. It's, it's almost unimaginable today when it's at 5, right? Right. But it's because it worked then, like everything just worked. And now, you know, I, you know, Okta growing 10%, Salesforce growing 7%, like they're good companies, but it's not, durable the way it once was.

So are those companies— my premise or what I thought and what Morgan Stanley— I thought because Morgan Stanley had this report, which who gives a shit about Morgan Stanley, but they said that the majority of value creation in terms of market cap for AI is going to be the big companies using AI to get better versus new AI companies. Do you disagree with that?

I think that Right now, today, as we record this, there's a hint of truth to it. And, and, um, but Salesforce is not accelerating. Okay. Okta is not accelerating. Lots of folks are not accelerating. ServiceNow has a lot of AI, but it already had workflows that were automation. So people say that, and there's, there's, there's, there's some, there's qualitative proof of it, but we haven't seen it in the numbers. Okay. So there's a window for the big guys to leverage this because The, the interface that we talked about is dying. People are not gonna want to use these dated interfaces anymore. So even if it is benefiting the big guys today, um, what is the value of, of a CRM if I don't log into the app anymore? If I just talk to, to ChatGPT and I say, give me the 10 deals I have to work on this week, like how valuable is one CRM over another? Or will I even know I have a CRM? Like it just becomes plumbing in a database. Here's one problem. Let's step back and I'll tell one problem with AI. One problem with AI is there's been too much nerdy nomenclature the last year. Too many Minis, O3 Maxis, LLMs.

It's so complicated. It's like, it's like knowing the difference between an iPhone 13 and an iPhone 14.

It's all, that's all going away this year. It's all that complexity made sense. As crazy as these numbers are, Anthropic went from $1 to $3 billion in revenue in 5 months. They just announced. $1 to $3 billion in revenue in 5 months. Okay. And that is basically all infrastructure plumbing revenue. Okay. So when the, in the area of infrastructure, you need to know the difference between the models and R1 and this. We're just starting the application age. And in the application age, we don't, we won't care what models HubSpot uses. We don't even, HubSpot already has a lot of AI. Do you know what models it use? You don't care, right? You don't care. So, so, so these nerdy terms are gonna fall away. But what, think of MCP as the next generation API and what MCP does is it lets any AI or others talk to applications without having to write inside of the AI. So right now, if you go to— now it's just rolling out, but if you go to, uh, and you set it up properly, and it's still a little nerdy, okay? But right now from ChatGPT, you can change your Google Calendar. You can work with Notion.

Tell me how.

You connect it with M— you just— well, I can— I can't quite do it with you on online. Maybe in 2 months. It's literally when you OAuth in, it will do it automatically, but I can show you offline. You just connect it. To your Google Calendar, and then there, the, the, it's still a little bit of a headache around authentication and security. Like the, there's a little bit of magic to go, but not much. And then you can just talk to your calendar and chat. And HubSpot has announced this. So Dharmesh is a—

but what are you using to connect the two?

So MCP is a protocol, right? So it's like a language. Imagine this, right? Like, um, you know, we have English, we have Spanish. Then when the internet browser came out, it was like, hey, there's a new language. We're gonna call it HTML.

Yes.

And you gotta learn that language if you want to tell the browser what to do, how to show a webpage, right? So now MCP is a new language that came out that was basically saying, hey, if you're one AI app and you want to talk to another application, how are they supposed to talk to each other? MCP became a protocol that now any app who wants to be like, yo, if like HubSpot, for example, they want all the AI tools to be using, to be integrating in with HubSpot, but they don't want to one by one go work out a deal and do a technical integration with each one. So they say, oh cool, we'll, we'll also speak MCP. We, we, we understand that language. We know how to do that. Just cut, right? It's basically like how APIs work for, for most websites. But MCP is like the AI-specific version of that.

But right now to integrate with, and I haven't ever used HubSpot's API, but I, I, I'm sure it's a great one. But, but that is bespoke. Like each one is different. HubSpot's API is different than Salesforce and Notion and Linear. You have to learn it. You have to get a key. You have to code to it. You have to understand its nuances. It's a lot of work, right? Like you, you may know startups, you've yelled at them, you're like, why don't you have a HubSpot integration? Well, because it's work, right?

Right.

With MCP, it's early, but it's just starting. It won't be any work. You just tell MCP to go talk to HubSpot or go talk to Notion and it will just do it. And all that work goes away. So if your AI can talk to any app you use, take all the data out and let you talk as a human, for 99% of the world, we won't use HubSpot like the way we use it today. There's no reason to log into this app. Figure it out. Like, how does the UI work? What are these tabs? How do I configure a tab? And, and the kids these days will never know this. Like, this generation coming up, they will never use software like we use it. They will never use it.

What are the— what's the office of OpenAI like right now? Because you're saying like, well, it sucks right now, but in 60 days it's going to be the best, which is insane. So how many people work at OpenAI right now? And actually, Sean, for you as well, have you guys been to the office? What's it like there? What's it like at that office right now if they're able to do all of these things so fast?

Uh, I think it looks like they have about 4,500 employees. I'll tell you what's super interesting. They only have about 60% employee retention over 2 years.

Because what, everyone's going and doing their own thing?

Probably, but it's just great. Like if OpenAI only has 60% team retention, what's your hope to keep your, your AI team? You better treat them really well.

So I have a friend who told me about the early days of Twitter, and he basically, he had built a company. He was like scraping Twitter and he was like, oh, this is cool. If based on what people are saying, I could figure out what's actually trending in the world. And the way he did it was he was like, you know, if people, people always talk about New York. So if it's, if I hear New York 1,000 times, that doesn't actually mean New York is trending. It just means New York is already big. But if suddenly everybody's talking about Tallahassee, well, Tallahassee doesn't normally get talked about that much, but it's being talked about as much as New York. That means it's trending. And so he had a separate site that was like trying to figure out what are the trends on Twitter. Now this, they ended up getting bought by Twitter and that's now what if you go on Twitter, Twitter has trending, right? So my friend Abder was just, I was like, what was it like in those days? And he was like, I thought I knew what a startup was. I thought, and I, this, I related to this so much. He's like, basically I thought a startup was I wake up every day and I got to go try to get some growth and I'm pushing, I'm pushing, I'm pushing the product forward. I'm pushing the marketing forward. I'm pushing my product out into the market. Push, push, push. He goes, then imagine, like, you know, you think you're pushing and then suddenly you're pushing a boulder up a mountain and you look up and there's a giant avalanche coming at you. It's pulling towards you, right? It's coming straight at you. And so he goes, my first 6 months at Twitter, he goes, I woke up and I had the QWERTY keyboard like imprinted on my forehead. Like I would just fall asleep at my desk and I'd wake up and I'm back at work, right? He's like, basically that's how I lived for like 6 straight months because And he's like, everybody's making fun of us because the Twitter had the fail whale. He's like, but you— there's nobody had ever scaled a service like this this fast. And so we just couldn't keep it up. And we was like, we were— trust me, we were trying. Everyone thought we were being lazy or stupid. He's like, we are the smartest people. We were trying our absolute hardest. And it was just so, so difficult. And I think what's happening with a lot of these AI companies is that, you know, Sam, you and I, I think we probably only really experienced push for the— for most of our startup career.

Yeah, it's never felt like I was holding on. It felt like I was pushing and it got a little easier sometimes, but it was always resisting.

Like, I have this company now, we haven't announced this, and I just like, we have this, uh, AI bot that will come and tell us our new contracts and our new revenue. Last week we closed $1 million in new contracts in a week. And I was like, I have never felt this level of pull ever in any business I've ever done. And we're not working 10 times harder. It's just that like the market wants this type of product at a different level. I'm sure that the folks like, you know, OpenAI and all these AI startups are going, they're experiencing a startup experience that is not—

we—

it was not anything like what, what you and I experienced, Sam.

I think it was 0 to 800 million users in 7 months. Is that what Mary Meeker said?

Yeah, I think so. I just wrote it up on Twitter. We could look, or X, but yeah.

10% of the world, 10% of the world in 8 months or something like that. Yeah.

So that's why the rate of change is so high that everyone that's like, A Luddite or a Debbie Downer is missing the point. Right.

And before it looked like it was a bunch of lookie-loos, like people were going and testing the product, but there wasn't really high retention. And then they've showed that like the, the actual, it's not just the users that have doubled, but the usage per user has also doubled. Right. So you have like a, a double of a double. Um, and that's, it's pretty obvious to me now that I'm kind of an idiot for not investing in this company, even at really any price point, like this is this is basically the Facebook of this generation, right?

Like, yeah, I don't think we realized that OpenAI, that ChatGPT would have 85% market share at the prosumer consumer level. That, that, that's what that, what all that meant. Surprise. If we, if we know, because ironically ChatGPT was an experiment, it was a proof of concept. It wasn't really meant to be the product that the, the center of OpenAI.

But like, do you beat yourself up about this too? Like the way I do? Because I'm, I just look back, I'm like, how much How many hours have I spent thinking about AI? I'm supposed to be an investor, you know, like you're a SaaS investor. This is the greatest SaaS, you know, fastest SaaS growing business ever. Are you an investor in this?

And did, and did any of you have the opportunity to invest in it?

I did.

But you can hunt it down, you know, that's on, that's on you.

You could.

Yeah.

For me, I want to, life is short. I want to own 10% or more of a startup and have fun. So hunting something down just is not my vibe, but, but it's the way to make the most money. Don't get me wrong. Nothing wrong with hunting it down. And, and someone's never heard of Sean O'Reilly's My First Million and just getting some money money in. Like, that's the smart way to do it.

But, um, I bet you, uh, I bet you Dharmesh— so I think on the pod, Dharmesh, I don't know if he explicitly said $15 million, but he sort of winked at it when we, when we said so. He owned Chat.com, which he sold to OpenAI for what he paid for it, which I think was around $15 million. And he, uh, got AI, uh, ChatGPT stock. Yeah, there's a world where that becomes worth like in the ballpark of his HubSpot stock, I think.

You know, that, that does probably, right? I, it's none of my business, but I remember thinking with Aaron Levy, who's one of my favorites, you know, he was early in Stripe, early in Gusto, like just back in the day. Aaron had a window before Box went public where everyone went to him and he had a little time, like he wasn't, and he just did all of them. And I'm like, man, if this guy did Stripe in the seed and like how that's gotta be, it's none of my business. It's gotta be worth even more than his Box stock, doesn't it?

For sure. He owns 4% of Box, I think, when it went public and he's been grinding Box for like 20 years.

I love him for it. Yeah.

Wait, so he, he was just around all the money on the Stripe investment?

Yeah.

There was a window. Listen, it's none of my business, but there was a window. I've been doing this long enough, right? Where before Box IPO'd, he had time, right? And then you just get— you just can't do this stuff when you're public, right? Maybe Marc Benioff can. And so everyone— he was the guru, right? He was the one guy he was, and everyone wanted Aaron. And so he would write these checks that, you know, but I know we could look them up, but I know he did Stripe and Gusto in the seed round and a bunch of others. And it's none of my business, but I'm like, That's, um, there are these moments in time that could be worth more than all of his, his box shares. And, uh, so it just gives me even more respect to keep going because so many founders these days have a different relationship to money and investment than a few years back. And a lot of founders would quit today if their investments were worth more than their founder stock. A lot of them do quit. A lot of them do quit now.

You know what this reminds me of? So it took me at The Hustle, I think it took me 3 years to get to a million subscribers, a million users. And that was like life-changing for me to get as fast as some of these guys are growing. It's like literally like that per hour. And it's sort of like when you see a billionaire who's worth like $4 billion, like $4.2 billion, and you're like, man, that 0.2 divided by 10 would be awesome for me.

Do you know what I mean?

Like, it's so, it's like hard to grasp how big and how fast, how big these things are and how big they're, and how fast they're getting that big.

Well, look, it's slightly underdiscussed and it's a crass topic. You might have discussed it, Sam, otherwise, but like, it's a crass topic.

It's like, it's right above our heads.

But because OpenAI will be worth—

You filthy pig.

No, but when, when, when HubSpot— I, I've been around long enough to remember when HubSpot IPO'd and it IPO'd at about an $800 million valuation. Okay. Today it's worth like $40 billion, but now like OpenAI will be worth a trillion. So my point is that the rich are so much richer.

Right.

They're like the regular person's like a little bit richer in tech and it's great, right? But because the big wins are 100 or 1,000 times bigger than just 10 years ago, just 10 years ago, the amount of billionaires I wrote up on Saastr, the amount of billionaires just in SaaS and cloud, I could find this post, but your jaw will drop how many billionaires are in it just because the market, the numbers and markets are so much bigger, right? There's already 100 billionaires in B2B software. I wrote up 100 billionaires.

For the people listening, what, what personality types are like, who, who's poised? Like, what 22— what does the 22-year-old today look like who can pounce on this? Like, what's the, what's the profile type or the personality type of these people that are just excelling like crazy?

I think it's just two things. And it really probably hasn't changed since Bill Gates days, right? Starting Microsoft. Um, but one is, um, you have to be able to ship insanely good software. Um, which maybe in some business software wasn't true for a while. Insanely good, like Higgs field that you're trying, ChatGPT. This is not trivial stuff. Okay. This is like insanely good software. And then the second one is you have to like be relentless to owning a market. There was a while in 2020, '21 where like being third or fourth was great. Hooray! Like, things were so good that like, you'd be like, well, if I'm number 4 in the market, but I don't have to sell a lot of stock and it's calmer and I could sell my company for $400 million, that's better than IPOing. Like, now the best founders today are relentless to being absolutely number 1 and destroying and owning the market, right? And because the markets are bigger, it compounds to something crazy, right? I mean, again, just one example, but Sam Parr and I are both investors and owners And like, you know, Adam was what, whatever, you know, high school dropout starting this company. I mean, he's going to disrupt the entire restaurant industry. He's already on the way there. Not be number 4. And he has an incredible technical co-founder, now an incredible engineering team. And that product owner, here's an interesting thing, because I invested in the seed round in 2021. Adam hates it when I say this, but the product was not very good. Dean was very good, the CTO. It did a lot, the product, but it was not very good. The reason it killed all its direct competitors, not. Not indirect. It hasn't killed the big ones. It's just because the software is so much better, and that just compounds every quarter. And AI is accelerating that even faster. So you have to build epic software. Uh, but if you destroy these markets, that, that's the path. But I just don't think this is a good time to be number 4. I could be wrong. I could be wrong. But it had its age. It had its time.

I actually disagree with you. I, I, I think I understand your sentiment, which I agree with, but I disagree with how you're phrasing it of there is, it's not great to be 4th or 5th place or whatever. We've had a bunch of people on this podcast that have built apps that were really fast money grabs where they got really big really quickly with tiny teams. And what I would tell them, which, what the hell do I know? But I would tell them, I'm like, this doesn't seem durable, but so keep your team small and ride the wave and take all the money and like do, do something else eventually. But it's a little bit different than it used to be because you don't need to build these huge infrastructures. You can have one-hit wonders. That crush it. You know what I'm saying?

You have—

yeah, I think one-hit wonder is the wrong phrasing, but I know what you mean, which is that you can— yeah, a base hit now can provide you enough cash flow to A, change your life, and B, set you up with like 5 more doors, whether it's investing or it's reinvesting into another company you start. And you don't have to build one 20-year durable company in order to be a winner anymore. So I think, I think I just say, like, back when we were in San Francisco early on, like the small lifestyle business, would get you the equivalent of a job. Now it gets you equivalent, you know, like you would make a couple hundred thousand dollars if you had a lifestyle business, you know, that was like, it was working, but it was small and it was solo and it was bootstrapped. Now those same solo bootstrappers have like $8 million ARR. So it's just a different scale that I can't—

I remember, but you know what the difference is though, that, that is, I think that term is, you have to be thoughtful about it in the age of AI when there's so much competition. You can build a 2 or 3 person company that's small, but the lifestyle businesses are being slaughtered because when these 3 kids come to SF working in the Mission and they're working 8 days a week and they've taken your little idea but made it much better, your lifestyle is gonna be unemployment. So this term I think needs to die. It, it made some sense, I think a few years back. It's okay. I just worry people are gonna take the wrong lessons from it. You have to work, start in this conversation. You can do more with fewer people, but you better work harder if there's comp— or find a space with no competition. Right. But the weird thing about AI is, is there's competition in spaces that 2 years ago had very little competition.

Like, what's an example that comes to mind?

I'll give you an example. I, when I started investing, I did a couple investments in legal. I knew a little bit about legal. Okay. And no one wanted to invest in legal. They're like, uh, it takes forever. Lawyers don't buy anything. It takes forever. It's boring. It's a slow market. Now there's 500 AI legal startups and there's reasons for that. But you could not be at that sleepy pace. Same thing I've done. Some of the best investment I've done has been in support, in post-sales. Okay. No one wanted to do this type of startup. Boring. Resolve tickets, pick up the phone right now. There's thousands of voice startups, there's thousands of these. And so if you think you can run a lifestyle, customer support startup, Good luck. Right. Good, good luck. Because Delphi out of the box is probably better than you.

You, you own a, a media company. You own, you own basically if we, a trade show that's incredibly successful. So let's just categorize that as a boring company that is not a technology company.

For sure.

Which is what, which is what I do as well. And Sean has done something like that in the past as well, I believe. For the people like, like that, how are you using AI in like a bore, in a, in a, in a not tech company? Are your employees now becoming significantly more efficient?

I mean, we only have 2 people now. I take it back. We have 5 people and we do $5 million per person now.

Did you have more people before?

We had much more people before. We had people in 2020 running. I didn't even, we had 4 designers. Now we have a little bit of a designer and AI tools. We used to have 5 people on this content team reviewing sessions. Now we have zero. Now we just have AI. So we got, we have none of the designers, none of the content people, uh, all the ghostwriters are gone. They're the worst, right? Well, I write my own content.

Let me drop you off at the airport.

No, but what would happen? Let me go in reverse order. Like, okay, 9 months ago, Yamini would come to a Saastr event. She's done it 3 times. Okay. And she would speak and 3 months later, a ghostwriter would write up a terrible summary of her thing. Just terrible. And I would cry and we'd ask them to fix it because I can't do everything right. And then about 9 months ago, they got better. They actually, they got, they weren't great, but they got better. And I hadn't actually used Claude. And then I went into Claude and I'm like, this, she just put it in Claude and they start charging us $5,000 a month for this. So like, we can do this for $20 in an hour instead of $5,000 and waiting 2 weeks with our clients, right? So we didn't need the ghostwriters. We got rid of first, right? Then we had 5 people, then we had an agency we worked with for years, and for a while it was great and they would review all these speakers. There's a lot of work to work with speakers. You've done it, Sam. And when you have hundreds and hundreds of speakers, it's impossible to do it all, right? But they decided they just didn't wanna work that hard anymore. So they own, they wanted to charge us 2 to 3 times more and only do half the work. So it just didn't help us. Right. So then we're like, we're, we're SOL now. We're 5 months before SaaStr Annual. And we just said, well, let's have our AI do it. And it, it reviewed 300 sessions, 300 slide decks, 300 presentations.

But do you have to chase those 300 people down to give you the job?

Yeah, we still have to, like, it doesn't get rid of everything, but it does 90% of the work and it better, and it does 90% of the work 3 times better. 90% of the work 3 times better.

Was that you, the business owner, who had to architect and come up with all these solutions?

Between Amelia, who runs Saastr, this media business and events, and me, yeah, we came up— no one else was like motivated to do it. Of course.

Um, uh, that makes sense.

And, uh, and then like we have a time, you know, we have a little bit of a sales team, but then RAI just started to do all the screening and initial sales conversations for us. That helped a lot.

Even for— it's, uh, this, is a very niche business, a trade show business. But to say you do $25 million in revenue with 5 employees is pretty breathtaking because I would have thought that would be on the lower end. Your business would be on the lower end of like, well, I still need people, but you have just proven that not to be true.

And so it could do better with more people. It could do better with more people.

It's not on your life. Your life gets worse.

No, on the honest, I don't mean to get off target. The real problem is I just can't. And Sam, this is why you think I'm grouchy because of early conversation we had. I've just struggled to to find enough A-tier talent that wants to do this non-sexy stuff. Okay. I would love to have 20 people on the team tomorrow. I have budget for it, or at least 15. Uh, but, but I don't need someone that shows up to a meeting with the sponsor and doesn't know what we do. Okay. I don't need a designer that doesn't finish the design until after the event, which I had once in the past, like sent us a big bill, but didn't finish the assets until after the event. I just don't need that. Right. Like, um, you know, I just don't, I don't need, I don't need someone managing 10,000 people in, in our, in our SaaS annual that forgets to do catering. Like, I just don't need, I'd rather have the AI come up with the catering. The AI did our catering schedule this year.

Well, could you talk about the start of SaaS real quick? So when you started this thing, you had sold your company.

Yeah.

Right. Was it, was it after you sold EchoSign or when did you start?

A long time ago, 2012. But yes.

So 2012, you sell your company. Great exit. As I understand it, you're like, I have retired twice. I got in shape, I picked up a hobby and realized, you know, like, I still love building. So, so you sell your company. Do you retire right away? Basically, you take a break.

Well, after— there's probably a little bit of parallel to Sam here. Both times after I sold my startups, I sort of didn't work for the better part of a year and just got restless for different reasons. Right. And I just got restless. And in fact, Both times after about 100 days, 120 days, I got a little depressed. Maybe depressed is too strong a word. I lost, lost, right? Definitely lost. I remember, you know, my second startup, Emergence Capital, which is a very successful B2B venture firm, had a CEO every year, had a big CEO meetup, right, where they would come. And in my, in my class, my group, I had David Sacks and Aaron Levy and Peter Gassner from Viva and Renee Assert. And then after I got acquired, I got to go to one more and they said, you can't come back anymore. You're not, you're not part of the, part of the CEOs anymore. I didn't, I got, I was off the team and, um, you know, Ben Chestnut did an interview just a couple weeks ago with Kleiner Perkins and said the biggest issue when he sold Mailchimp for $12 billion or whatever it was, is, was he knew he would be instantly irrelevant. He knew he would be instantly irrelevant. He said, I am now. I'm irrelevant now. Mailchimp's of the past. He's like, you wouldn't even build a tool like Mailchimp today in the age of AI.

Hmm.

Right? Maybe that wasn't quite the point. So yeah, so, so that was it. And then. But then what was fun for me, and this is, is a long time ago, but what was fun for me is because I was the first of those CEOs, like the Aarons and the David Sacks that had an exit, I didn't have to pretend anymore. So I just, maybe Sam thought I was grumpy, but I just shared every mistake I made, how I screwed up my first VP of sales, how I screwed up, um, meeting customers in person, how I screwed up marketing. And there wasn't much content back. It's a little different than today. There wasn't much content. So everyone just started to read this.

Were you being strategic? You're like, oh, I'm gonna start doing content marketing. That's gonna lead to this, to lead to this. Or you're just like, I've got time on my hands. I, I've got stuff to say, I want to start blogging.

I did what now people give advice to, but I didn't. There was no one to give the advice. I just wrote one blog post a day on a mistake I made. That was my, my paradigm, right? A mistake I made as a B2B founder that got to tens of millions. And back when Quora was a platform, and people listening to this won't even know what it is, but Sam will, I answered one question. I answered one question. So people, this was a way for people to ask me questions. And they, those were great because they were very tactical, right? They were very specific. So I would do one a day, every day. And Nick, it does, you know, I'm a— it's a little different today in AI, but generally speaking, if you do that, it compounds, right? It doesn't compound the same way revenue does, but if you do My First Million every week and you just keep working at it, and it does seem to compound, doesn't it? Just not, not quite as linearly as we might hope, but it does compound. But I didn't know one— there was no advice back then. I just did one, one and one a day.

You were also one of the first people to do Twitter. You were one of the first, like, tech people to, like, you know, for a lot of tech people, Twitter didn't boom until COVID, but you were doing it very early. You know, it was like you and Gary Vaynerchuk.

Twitter started with tech people. What do you mean?

I don't think it was taken seriously. I think that, I think Jason looked at it as a craft where he was like, I'm going to grow a huge audience here. I think, Sean, that for a long time, Twitter was an afterthought to a bunch of different social media platforms. Now I think it's bumping.

I just think I approached it as a microblog, which is what Twitter in the old days called it. So I would put valuable content on Twitter instead of being grouchy or just, just, just, you know, and so I was early to putting valuable content, I think, on Twitter. Right. I think if I benefited anything in content, I think it was just being early.

You were early. You've been— dude, you are an output machine. And the stuff that you write about is lyrical. Like you write about things. SaaS is a stupid, boring thing. You write about stuff where I'm like, I don't even own a software company, but I want to— I love reading what he's saying. You know, it's kind of like Dye Workwear with clothing. It's like you don't have to know about clothing, but when he talks about ties, for some reason it's kind of exciting.

Well, that's a good insight. My actual real goal of doing it was to make it more fun. Building boring business software, make it more fun. Not, not, not in jokey way, but to celebrate the fun part, the exciting parts of it, right? That, that, that was my version of what Sam said.

Did you think, okay, then I'm going to be investing, this will help with deal flow? And like, where did the conference come in? Because that's a pretty going to be a gangbusters business. I can't imagine you thought at the beginning we're going to be doing $5 million per employee. We're going to do $25 million a year in this business where we have kind of like a little, like our monopoly. We're the big fish in this small pond of, of, of basically like thought leadership for SaaS businesses.

Well, the pond, there's more thought leaders today, but if you, if, I mean, it's a while ago, but if you are curious, I just wrote this just because I was a blue, uh, and, and it was something to do, something to share, something to add value to the world, right? No goals. No goals. Um, I certainly wouldn't start off with a blog today if I started off today, right? As, as archaic as it is, there still is SEO, but what, what would you do? Uh, even it's not me, right? But of course I would do video. I do video, but I'm not you guys. Like, it's not my natural— I'm a good writer. I'm not like, uh, Ernest Hemingway, but like Sam said, I have something special. I'm able to convey ideas in a way that helps people in writing. And I still think today that's a rare skill, right?

Dude, I hate video. Sean's pretty good at it. Sean can talk to a camera by himself and succeed. I hate it. I hate video. I think that like, I think there's a generational gap.

You need to put a supercut of Sam's ad reads.

Oh my God, they suck, dude.

Sam's fucking ad reads.

It sucks, man. I, it's not, I'm incredibly uncomfortable doing it. I think, but I think that like the, 25-year-old today, just like the fact that FaceTime has existed, they're so much better at it. Uh, so there's like a huge, there's a generational gap that I'm like 4 years too old to have caught.

But if it's of interest, it might not be. The investing was an accident too. It was an accident. I actually, for about a little less than 2 years, I worked at a VC firm that had invested in me. So they, they recruited me to help them. I had no real interest in investing. and I showed up and I like, I don't know what the hell— like, this is not me. I don't know what to do here. But luckily I'd started this blog and founders started to come by the office. So first the founders of Pipedrive came by the week I started, and that was my first investment that sold for $1.5 billion, right? Then other founders started. Then founder of Talkdesk came by. That one was worth $10 billion in its last round. Then the founders of Algolia came by. That's worth $2.5 billion. Um, then the founder of Salesloft came by. We sold that for $2.3 billion cash in 2021. And they kept coming by and I'd be like, well, let's just invest in these ones because these are the best ideas I got. Like, I'm not the outbound guy, like finding Sam Altman. So I just invested in the 5 best guys that came by the office the first year, but they're all worth— ended up being worth $1 billion. So, so that's— I only— so the weird thing about me for investing, and then I can tell you about events real quick, but I don't spend all the time— I only— I'm different than 99.9% investors. I only do SaaS super fans that are high-intent inbound. I don't take favorite meetings. I don't do warm intros. Uh, if you tell me, Sean, there's a startup that you want me to meet to invest in, or Sam did, I would ask, is this— do they desperately want me? And they'd be like, no, they haven't heard of Saastr, I'm out. Right? But if they really want me, they probably just email me. So I don't even want a warm intro. I don't even want a damn warm intro.

That sounds like such a leak in your game, by the way. That sounds like an unnecessary bar, right? Like, not only if I get a warm intro that they say this person's kick-ass and they'd love to, you know, but it's like, Are they a huge fan? If they're not a huge fan, I'm out.

That just seems like unnecessary. Yeah, but the thing is, like, investing is so much harder than it looks. The odds that any start— like, seed startup's going to truly be worth billions of dollars is much lower than it looks in the media. It's really hard. And if you don't have, like, if you're not incredibly intense, if you're not incredibly— if you don't want this more than life, you're not— you're going to— you're just going to sell your lifestyle business, which is very logical.

Oh, so you're basically saying if they're not like basically digging my content, they're not taking as seriously as they should. Is that, is that the implication basically that if somebody is seriously trying to build a generational company, they should be loving our content and therefore they should want me on the cap table?

I want them sending me a cold email that is so good that you would invest off the cold email. This is how I invest. I want a cold email that is so good, that is so good that you don't even need, you almost don't even need to meet them. The only point of the meeting is confirming that you want to invest. Like every investment I've done that's good, I've wanted to invest before the meeting. Every good outcome I've had this—

That's how I invested in, in, uh, Owner. I'm a little bit after you guys, but I got an intro that was like, this guy's one of the best founders I've ever met and ever invested in. And this, this company's growing incredibly fast.

Yeah.

And then he sent a cold email basically right after that, which is like, hey, here's why I want you on board. And here's my last 3 investor updates. And in that, one of the things that he shared was they had done like a hack week. So there was like some Loom videos of the team sharing their hack week projects. And I actually just watched those.

Yeah.

And it just showed like the, the caliber of the team was really incredible. Like you can see the caliber of team in a hack week project, right? Because almost by definition, it's here's just like one or an engineer and a designer. They come up with their own idea. They have a very short timeline to ship it, and then they have to pitch it and present it. So you get to see like the quality of idea, the quality of speed of execution, and the quality of salesmanship. All in one from like without abstracting away the founder. It's like that's the team itself. And I emailed him back with, you know, I was like, we don't need to meet. I'm in.

Yeah, you— that's— it's not the only way to invest. But what I can tell you is if the email's mediocre, they're not going to make it. There are exceptions. Okay. I know there's exceptions, but man, wait, dude.

So we just, um, at Hampton, we're hiring a bunch and I'm putting together like values to look for when hiring.

Yeah.

And I only made it— I think I'm only going to keep it at like 2 or 3 values. But ability to write an email and communicate is the— is one of the 3.

And I will tell you of the— one of the reasons we only have the 5 people is I have lowered the bar at Saastr in a way I never would as a software founder. I've lowered the bar again and again. I've hired folks where the email wasn't that great. I've hired folks where they put an E in Saastr. I've hired folks that didn't do the research before they started. 100% failure rate. 100%. Like, we already know this, right? But I've lowered the bar because I'd be like, well, this isn't as cool, cool enough. I got to take who I can get, right? Always a neg— worth less than zero, right? Total, total zero.

Yeah. You have this great tweet. You said you think startups are about a great idea, but in the end they're about great recruiting. That's what you're talking about. They—

yeah. And if you talk about owner, not to use one, but because it's a mutualist, I will say there actually are lots of risks with Owner, and I invested very early. You didn't see the two times we almost ran out of money. Now we have infinite capital, a lot of other things, but I actually do not know a more relentless recruiter than Adam. I don't know a more relentless recruiter than Adam. And that, that is a rare skill. We all learn it as, as CEOs. Like we get bet, we always get better at recruiting, right?

What does relentless look like? Like what does that mean?

Literally reach out to the 200 best people in the job. Talk to all of them. Set up meetings. Cold, warm, lukewarm, direct, LinkedIn. Who are the 200? Like, talk to everyone in the world. Who are the 200 best CMOs that I could possibly hire? Don't pretend to talk to 200. Don't actually only do 5 interviews and pretend you're doing them. Do 200. That's what the S-tier recruiters do, right? The S-tier. I had an old co-founder, and I wish we'd gotten along better, but he was one of the best I ever knew. And I'd roll into work every day at 8 o'clock. And he'd already handed me 2 candidates to talk to that were really good every day. Every day. I've never— Adam has that, but I'd never seen that magic, right? And I don't have that skill to— every day he'd found a way. Hey, I've got this marketing and this sales guy I want you to meet. Can you talk to them today? 2 more? But then they'd always be great. They're not— they wouldn't always be a fit, right? And that's, that's how you— only way you can scale as an executive unless you have a 3-person startup.

You have a few more of these really great, like, how to be a great CEO concepts. So one is to be a great, great CEO, you have to enjoy telling the same stories again and again and again, hundreds of times.

Yeah. Yeah. Even Sam Altman does that, doesn't he? It's pretty much the same story, right? It is that, that one, the, what I like that Sam does, I can comment, he tells you the future like Elon Musk, if you're listening.

So what do you mean by that?

Well, you know, he does this, you can make fun of this goofy video he did with Jony Ive. I don't know if you saw it when they did it, like perfectly lit and they're having coffee in North Beach.

My favorite rom-com of the year.

Yeah. You think, oh, this is silly, right? But, but listen to what he's saying. He's telling you that in the not too distant future, you will be on ChatGPT 24 hours a day. Right. And I'm making the bet that Jony Ive is the guy to do it. I'm not betting that he's gonna build a rabbit pendant. It's not that. I'm making a big bet that he knows UI and UX so well for the next generation that he will solve this problem where we are on, and Sam's already on ChatGPT more than the average today, right? The average person's on like 22 minutes. You said you're on it more, aren't you?

I'm on it all day.

Yeah. So Johnny Ive is going to figure out a way that it's in your ring and it's in your phone and it's in your glasses like Ray-Ban. And he's going to figure out stuff we haven't figured out. And it's in our, it's in Sean and I's headset. And we are just like, what if it was in this headset? Like this is totally passive, right? I mean, I don't know if you guys have used Granola or the newest Notion. It records everything you do all the time in the background without permissions or visibility. You know why Granola is so successful? For note-taking versus, I don't know if the one you said does this, Sean, but you know, Granola Granola just records everything at the hardware level. Like I could be recording us in Granola right now. And you, we had, we had, we had a chief customer office officer summit, 200 of the best chief customer officers at SaaStr this year. And the guy that put it on that day wrote up the whole summary of every single session that day. Like very, very good. I even, I couldn't do it. He's like, oh yeah, I just, Granola just listened to everything and it wrote it for me and it was done that day.

Do you feel this way, Sean, where I hear this and I'm like, this is so exciting. And then, but the other side of me is says, this is so intense. I have to like, I hopefully I can invest in something and make a profit. Otherwise I need to take my winnings and go home and hopefully they compound, compound by themselves because there's an intense future that you're painting here. Like, I don't know how I feel. I sometimes I'm like, this is so exciting. I want to get in. This is, this is amazing. But then other times I'm like, but if my life depends on this, I don't want to play this game. So this seems so intense.

I know exactly what you mean. I've now experienced basically like I graduated 2010. Right? So when I graduated, I basically like, that's when the light bulb turned on. I don't, I don't, I don't even remember life really before that. You know, I didn't even know the great financial crisis was happening. I was sitting at a Chick-fil-A somewhere in '08. You know, I just was oblivious to the, to the whole world, right? But when I came out 2010, basically 3 things have happened since then that were of note. There was mobile. So right when I moved to San Francisco, I remember, you know, I joined Birch's startup studio. And there was a single mobile developer and he would, my very first day, he was giving a tutorial to the other 12 engineers who were like, you know, super seasoned Silicon Valley engineers, but they just never built an iOS app before.

Yeah.

And I'll, and like that ratio of like one mobile developer to, you know, 12, 15 non-mobile developers within 12 months, it flipped. It was like, if you're not doing mobile, what are you even doing? Why would you do a startup if it's not a mobile startup? It was like a, a, a dumb idea. And by the time you're, you know, a year later into the job. And so I saw mobile come, and mobile was one of those where I would say it was obviously going to happen, but it was the fog of war. You didn't know where the opportunities were. And actually the opportunities were very different than the previous wave. So like Michael, who had made $1 billion in Web 1.0 or 2.0 or whatever, like, you know, the Facebook era, he didn't realize— even Facebook didn't realize— Zuck didn't build mobile apps, right? He was like, no, no, no, it'll be mobile web responsive.

That'll work.

And, you know, the fact that basically Uber was like the big— Uber was like the biggest winner basically during that, like that era when we, when we launched and Uber was like physical world interaction, like you push a button, but a car has to show up and you have to manage these drivers. And that looked nothing like the winners before. So there was like, we all knew mobile was big, but we didn't understand the fog of war prevented us from seeing the path to victory.

Yeah.

Then the next one was crypto. Crypto had a different flavor, which was it was not consensus that this was going to be big. In fact, it was very fringe and you looked a little crazy for saying this was going to be big. And so most of us missed it for that reason. And now this is really the third one. I'll like take COVID out because that was, that was a little bit of a different thing. This is the third one where again, everybody agrees this is going to be huge. This is going to be the biggest of all of them. It's the biggest opportunity ever, right? So everybody agrees on that. But there's complete fog of war because like you're saying, even the apps that are working get disrupted. There's like so much creative destruction there. One moment you think it's the models that are going to get all the money, then you think it's NVIDIA that's going to get all the money. Then you think it's the applications that are going to get all the money. Nobody knows how to win. Uh, even on the investment side, like the VCs also, you're sitting there and you have this really weird feeling because you know this is the time when all the money is going to get made. The generational money is going to get made now. You still have no idea where to put it. And people are trying to figure that out in the fog of war.

It's like that Warren Buffett phrase where they, where he says, um, every, every, you see who's swimming naked when the tide comes in or goes out, you know what I'm saying? Uh, where the idea being like, uh, you know, when there's turmoil, that's when you get greedy. But the hard part is A, the courage, and B, to know when the turmoil is actually happening. You know, are you in that period? Now we all know it's happening. Uh, this is the time, but do you or I have the want, desire, courage to actually get after it? And half the time I think think, hell yeah, this is amazing. The other half the time I think, this is, this is scary.

I'll open and read a book.

Yeah, I want nothing to do with this. You know what, you guys agree?

There was someone, I wish I knew who it was, someone on Twitter had a good tweet that resonated with me on this point. He's like, what the smartest play, if you can possibly pull it off today, is to go make $5 or $10 million, cash out, and just chill because you can't predict where it's gonna go. Like, this is the world's gonna, like, whatever you could do to, to liquidate your assets now, they may be worthless down the road. So liquidate them right now and chill if you don't, if you don't see the future. Because this is the time, right? I do think, and I also think, you know, I used to, it wasn't until we ran our own AI again, I used to think Vinod Khosla, I mean, obviously off the charts smart, right? But when he used to talk about how AI was going to bring mass unemployment in tech, I used to think he was just being crazy, right? But now I can see it. It's also coming. I can see all the, I mean, McKinsey just laid 10% of their team off, but it's just a start because they put in all of their learnings, all of their data into their own AI like Saastr. And now they just ask the AI, they don't need the kid anymore, right? Half of our sales and marketing teams are going to be gonna be gone in 2 years. There will be no BDRs in a year. And so this mass change, and it is hard to make bets. So what's happening in venture, for what it's worth, there's really 2 things happening right now in venture. 70% of the money's going into growth. And right now it's a great play. You do Claude at a billion and then it goes to $3 billion and the valuation goes 5x. You put in $200 million, that $200 million goes to $600 million, right? You take home 20% of the profits, you make $80 million in a year, right? That's where venture's going. All growth. It's all growth. And then it's doing seed, early stuff. But implicitly, people are assuming a very high loss rate and they're paying very high prices. $60 million, $100 million valuations at seed, and they're hoping it's worth billions. But they understand, like, there will be uniquely high loss rates too. They're not saying it, but they know it, right? They know it. Yeah.

And that seems hard to make money, right? Those two, that combination of high valuations and high loss rates. Doesn't that—

well, if you have $100 billion outcomes, if you get one per fund at all, that, that's the bet they're making, that there'll be $100 billion outcome for each venture fund. Right. But back when HubSpot— again, when HubSpot IPO'd, the bet was you'd have a billion dollar outcome per fund. One. Now it's $100 billion per fund. So if you believe you'll do that, you can do some— you can do a little analysis or waterfall and you just have Claude do it for you. You don't even have to do the analysis yourself anymore. I did this over the weekend. You just gotta find one of them and they all, the rest can crash and burn, right?

So, so what is your game plan?

I have decided that whatever brand I still have and my excitement and my ability actually to know more than, because I've done my AI, I actually know more than most people that aren't, that aren't on the like programming tool side. I've decided that I'll get one, at least one $10 billion deal done in the next 3 years, 2 years, one.

One.

No matter— I'm only in it for one. Whether that means I have to do 20 investments or one more, it doesn't matter. Um, I, I'm in it for one, right?

At the seeds, at the early stage.

I want to own— I want to try to get one deal where I own 10% or close that's worth $10 billion. I've sort of done it once on paper. I've done a couple billion-dollar ones and I'm just— and I've missed a lot.

What would that be worth to you if you owned 10% at seed of a company that outcomes at $10 billion?

Well, multiply— if it's just 10, if it's just only $10 billion, that's it. But multiply it by 10%. So that's $1 billion, right? And then you keep 20 or 25% of that.

But there's going to be so much dilution along the way, right?

That's what I'm asking. You don't account for dilution?

No, I'm simplifying my goal. You could own more, like you'll own more, and then there'll be investments that are highly diluted.

So at a, at a $10 billion outcome, at a seed stage, you are looking to make $200 million.

Yeah, that would help.

Okay. That'd be cool.

I think, listen, if you really want to know how venture, if you really want, I know we're going off topic. There's two ways that I think venture works. If you want to simplify a lot of it. One, it's a great job. One, it could be a mediocre job. It could be a great job, or you could try to make at least $100 million. I think anything else is, it doesn't exist. There's a gap that doesn't exist because you're either in it for the fees and the job. Initially, like, wow, I'm a kid, I'm getting paid $250,000 and I just get to take meetings. It seems great. Then you're finally a partner and you make a couple million bucks a year and that's like much better than like some other job. But there's a pretty big gap between that. Like you don't, it's really actually, unless you're great, it's really hard to make profits in venture or carry. So the game is to make a fucking lot of it. Okay. And listen, and the thing is, if you're in a big winner, if you're in multiple big winners, just do the math, Sam. Like, that's why most VCs make nothing except a good salary. But there are a bunch that have made billions because if you're in like 3 or 4 or 5 of those $10 billion outcomes, which is very hard, then you make a billion bucks. Now the founders hopefully make much more. It is fair, right? But you're either playing that game or it's a performative game where it's really just for fees and salary. Like there really is a— there's nothing in between.

But you also have the media and events business too. So you also have this cash flow. I assume that that's a very profitable business.

It wasn't before COVID but it is now. Yeah. Yeah.

So you, you have that either way.

Yeah. I mean, I made enough as a founder. I have a safety net. I mean, it's a, but I don't, I actually view it as a net negative for investing, but it is, uh, but it's a passion. Uh, we, we do a good job, but yes.

Last question. I, I know you have college-age kids, freshman, sophomore. Yeah. What are you advising they're gonna do when, when they're saying, dad, you know, what should I do for a job? If they, if they ask you that, uh, what would you advise them to do now?

First, I don't think a lot of these kids will ever have a real job. They will find ways on the internet to make money. So, so I, it is interesting. There does appear to be a gender difference, which I don't like between boys and girls. Of my sons, my son's a sophomore now. 10% of his class didn't even want to go to college at all. And they just decided that they could, they all had this vibe. I'm going to go to Eastern Europe where it's cheap and I can just make money on the internet. I'm never going to have a real job. There's no interest in ever having, and I don't think my son really wants to ever have a real job. And he's super smart. Like, he's much smarter than me. Math. He's now— he's deep in AI. He can— he's deep into Cursor and Windsurf. He pays for Cursor out of his own pocket. He's learning assembly language now so he can code to the metal and do everything. But he'll never have a real job. Okay. He's like, worst case, I'll work for Airbnb from— right. So he's never going to have a normal job ever. Okay. My daughter, it's interesting. She's at Stanford. Okay. And the vibe at Stanford, this is, if you ask, it's kind of interesting. This is a shocker to me. They all want to go to grad school now as freshmen. So they're all, they're all architecting their classes, their majors, so they can go to grad school so they can defer work. Like when I was in college, people cared about grad school. Then I think people made fun of grad school. Like, why would you go to grad school? Like, go to the internet, right? That was the vibe for 15 years. Now they all want to defer reality. And I don't know that there'll be any jobs. And I don't know that people want to work. Work. I honestly don't think— and I don't mean this negatively— I don't think a lot of the current— they want to be creators or they want to do other things. I just— whatever made us want to work, the three of us, I don't see it in the next generation. Very rare.

The women want to be educated and the men want to move to Eastern Europe and make money.

I'm not sure it's the women want to be educated. I just know her group does. That may not— but, but the men not wanting to work at all, like, like coming out of high school and just saying no fear, like No fear. I don't know what it was like when you—

when I—

during my life, I was worried I wouldn't have a job at different times, right? I was worried during college I wouldn't— during— I was always worried. There's no—

I was, when I was a senior in college, I remember thinking, man, I would kill to work at KPMG and make $45,000 a year. Like, I remember thinking like, that would be a home run if I could see your yearbook quote. I'm like, KPMG in Nashville, Tennessee. If I could make— if I could get 50 G's from Deloitte, That's a home run.

But it's so, so I think, I don't know that they're going to work. And then I think a lot of the 2021 generation isn't going to work again either. I'll give you an example. So someone I knew a little bit, um, there's a lot. So I did this exercise, um, I just like lowering the bar for hiring. I did this exercise. I know I shouldn't do it, but I want to try it anyway. I reached out to folks that had that circle on LinkedIn. What's the circle on LinkedIn? Out of work? What's it called? Looking for work?

Yeah. Open to work.

I looked, I worked out to folks that I knew a hint of. I hit, maybe I met them backstage at a Hustle event or something. I'd met met them in passing, okay? Enough that I had like a micro connection that had been out of work for 6 months and I gave them jobs. All of them in the end basically said, I want to make $200K or more only to do meetings or manage teams. None of them were willing to do any work themselves. None of them.

The young people, the Gen Zs, folks, their expectations for salary or for comp is so high.

Well, there's that too. I'm talking about folks that have already been out of the workforce for 6 months. But yeah, the expectations are they'd rather not work. That's the thing. A lot of people would rather not work than get their comp, right?

I mean, yeah, that sounds good to me too.

I don't know how everyone's like, listen, there's obviously an element of privilege in this, right? And for folks that are living in different geographies or others will think this is disgusting. And I think they're right. But I also think folks who have made a little bit of money in tech or otherwise are happy to live on relatively low amounts of money with, with their savings or others rather than just take a job. Job, no matter what it's— what, what the internet says, right?

Um, Jason, is this a stupid mental model? I do this sometimes. If I want to hire somebody and I'm interested, they're $200,000 a year, let's say, and let's say my business is 20% net profit margins. I think to myself, this person has to basically generate $1 million of extra revenue just for me to break even on their salary. Now, maybe they're— maybe they're doing it in coordination with a team, but like, the addition of this person, in order for it to be a positive ROI, I have to believe that adding this person yields me $1 million of extra revenue. And when I do that, I mean, 90% of the time I'm like, there's no chance. No, this is like, that wouldn't even make sense here. Um, so I don't know if my mental model is broken or if I'm actually onto something with that. Is that, how is that, is that a really dumb way of thinking about that?

That is, that is the model for sales reps. Like traditionally a sales executive, whether they sold software or an automobile, a sales executive in base and bonus would take home 20% of the profits. If you look at how car dealers— car dealers have low margins, right? But if you look at the margin, to a car dealer, the guy selling you the new Lexus, net-net would take home 20% of the profit to the dealer, right? If the dealer made no profit, they'd make nothing. If they ripped you off and got you to pay list plus the CD player for $1,000, they'd make a lot, right? Sales is the same way because in software, the margins are almost 100%. Reps would traditionally take home 20 to 25% of what they closed, right? Sales. For other roles, um, it, it's really just about leverage and you're often just hoping to break even.

But even to break even, let's say it's a $200,000 employee, to break even you need $1 million of incremental revenue to break even on that.

Yes. But one way, this is what I learned, for example, one way that law firms traditionally were structured, this is slightly interesting and it may be different today, but traditionally law firms actually, most law firms, not the big they, the, not the litigators, but like your corporate law firm that helps you on stuff, they never made money on the associates.

Okay.

So why would you have associates? I didn't know this till I asked a partner that I worked with back then. He's like, 'cause I just don't wanna do that work anymore. I don't wanna write the certificate of incorporation for Sam. I don't wanna do the NDA. Like, I don't, we don't make any money net, net of training and offboarding and churn and the, and the desk and the computer. We don't make any, but I just don't wanna do the work. So for your organization, you'll also like, just to not have to do the work, right? But the problem with AI is it lets us do more of the work. That's the weird dislocation. So instead of paying that person, like you can't even find the $200,000 person, at some point you'll just do the work yourself with AI, right? That's the cognitive load. Um, but that's why it's the mix. I don't think everyone can be profitable. Some folks just have to reduce the load on everybody else, but AI is going to do more of it. Yeah. Right.

You're full of information. I, um, you know, I think Theo Vaughn described one of his guests as a blind Russell Terrier or Jack Terrier. Or no, sorry, a deaf— what was it? A deaf— fucking ruined this joke, but we're going to laugh anyway. What was it? A deaf Jack Russell Terrier where he like gets out of the car and he like goes crazy. You can't stop him from yapping. That's kind of like what you are where it's like we just like hit record and we just like, you just roll and we just are on board and listen to you. And you're the man. You um, you're just full of, I think, really good comments that are done in like strong taste and tend to be right.

Jason, don't get confused when he calls you a blind deaf dog. That's— he's trying to give you a compliment. He does it a little bit differently.

Yeah, yeah.

And grumpy.

Yeah, and he called you grumpy. So you're welcome and welcome to the show. There's a goodie bag for you on the way out.

Thanks, man. You're the best. Um, that's it. That's the pod.