I failed 22 times... then I built a $2.5B Company

And at the time, my email was christina@usv.com. And it was like, the right side, that usv.com, is way more powerful than the left side. And now you are giving that up. And so what are you?

You're betting on the left side.

You're betting on the left side. And like, why would you do that? And like, what do you think will happen here?

Do you know what you, Katy Perry, and Serena Williams have in common?

I got nothing.

You're all on Forbes' self-made women list.

I hate that list.

And you are ahead of them. Isn't that kind of amazing?

I would have preferred that list never existed.

Yes. You have that Midwest modesty.

Yes. You're like, nothing good will come from that list.

Yeah, yeah. Those lists are, um, they're sort of made for the wrong type of people.

Yes. Um, or jail time later or something. Trevor Noah laughed at— I was never on 30 Under 30, and I'm deeply glad about that now.

Yeah, that turned out to be an anti-signal. You know, when I was thinking about this episode, the way I think about it is like where you are today is where a lot of people want to be. You have a company that's working. It's got like a cool startup name. It's got a cool office in San Francisco. Last valuation, I believe $2.45 billion. But who's counting? Today you're at where a lot of people want to be. But if we rewind the tape, to me, when I looked at your story, I think the through line for this is not counting yourself out. So I'm gonna put that out there. That might be true or might not be true, but the basics of it is you, you had a good job and you quit to try something new, to try to make it on your own, which a lot of people want to do, but they don't take the leap. You took the leap and it's not like it hit right away and you created Vanta and you created this, you know, multibillion-dollar company right off the bat. You did like 35 things wrong, uh, or 35 projects that went nowhere. And I love that because I spent 8 years of my life banging my head against the wall with failure after failure after failure. Each time believing this is the time, right? You know, let's start where you have a good job.

Yeah.

You have the job at USV, which I think you kind of hustled your way into.

I would say stumble hustled.

Okay.

I didn't like the stuff. What's a stumble hustle? They announced that job like they do all their jobs on the internet and said, "Hey, fill out this form if you want this job. Send us some links to your web presence." And so I literally sent them 3 links to my web presence and didn't email anyone who knew them, didn't— you know, turned out I, like, knew people from school who knew— didn't pull anything. Just sent them links and put them in a form and was like, "Well, now I'll go back to making slides." What kind of links? It was Twitter, Flickr— through the era of this— and I had started a design blog a couple months before when I lived in Berlin, because I wanted to be, like, a designer who lives in Berlin, and those people seemed to have design blogs, so I started one. And that was it. And they hired me, which is crazy.

And I read something that was like, they, maybe Fred or somebody at the USV team was telling you, you should specialize in crypto. You should become a crypto VC. Is that true?

Kind of. It was actually when I was leaving. So this was end of 2012. I had a lot of angst because this job was great. They were great. You know, like, haven't you made it? And I was sort of like, eh, but I don't think I like it. And again, what's going on? And One of my hangups was, uh, you know, what have I done? Why would anyone take my money? Right? Who's going to take a check from me versus, in my head at the time, Matt Kohler, this, uh, GP who's no longer at Benchmark, but had this, like, illustrious Silicon Valley career of, like, LinkedIn, Facebook, Benchmark, you know, and you're like, me versus Matt Kohler, everyone will choose Matt Kohler, like, 100 out of 100 times.

Which is, let's say, maybe a part partially imposter syndrome, but also maybe hyperlogical also.

Yeah, I think, like, yeah, but, like, also true. Anyway, and I basically said that to Fred, and he said two things, which— or he said a couple things that were deeply insightful. One was like, well, you know, Gwen Cristina, you've got to, like, get over that. And you can either get over that by sort of out-hustling people and, like, kind of the fake-it-till-you-make-it strategy. And you're sort of like, look, I've seen you in the office for two years, worked with you for two years. Like, you're not— you're not going to be good at that. So you probably shouldn't try that one. The other strategy is pick something, go deep in it, and be the expert where no one else is. And in the fall of 2012, I recommend you choose crypto. Really good advice on a bunch of dimensions.

Right.

I didn't take it, but like—

Because you didn't believe in crypto or you were just like, that's not me.

I was just like, I don't know if I wanna be an investor.

Okay.

Even though it's great and it's wonderful and it's all these great attributes and like everyone else wants to be a VC, but like, I wanna go make things.

So you decided to go make things. Take me back to that decision. Was that easy?

No, I was so angsty.

Was everybody patting you on the back and saying, you're gonna make this happen?

Definitely not. What I did and what my plan was, was I'd saved my bonus from the prior year and I was kinda like a finance bonus, and I was going to live off of that as long as I could. So like, no job but a bunch of structure, learn to code, learn to make products. Hopefully something would come out of that. And very much pitched as that. It was not pitched as, I am going to start a startup. It was pitched as, I am going to teach myself to code, because that's how I saw it and thought about it. And like, yes, I wanted to start a startup, but I'd seen over the 2 years at USP so many people start startups to start them and then get into them and then be like, I don't want to work on this, but now I have people in office, investors— like, I can't stop. But I think there was— I think people took that conservatism as, oh, you shouldn't be doing this. And so specifically, there was a— I mean, there was a bunch of, like, why— no one leaves USV. Who has the option of staying? Why would you do that? Or don't you want to work at some other venture firm? Or, oh, you want to code? Why don't you go to grad school? Stanford has a great graduate program in computer science. Why don't you go work for somebody else? Because clearly you don't know what you want to do. And then some amount of, like, kind of the tougher stuff, I think, where a couple— one person in particular I had been close to and who was very like, "This is the left side and the right side of your email address." And at the time, my email was christina@usv.com. And it was like, "The right side, that usv.com, is way more powerful than the left side. And now you are giving that up.

And so what are you?" You're betting on the left side.

You're betting on the left side. And, like, why would you do that? And, like, what do you think will happen here?

So you have the good job.

Yep.

You quit. You hear the— look, you took the rights out of the email, which was the powerful part. You threw it away. You're betting on the Christina part, of which there are many, many. And your plan is not even to go start a company. It's to learn how to code. And you're going to teach yourself how to code by going on online and learning how to code that way. And my understanding is that worked because I went to your website. Well, you have this like list of projects.

On purpose.

I built all these things.

Yeah. None of which you've heard of.

Yeah. Mostly went nowhere. There's something romantic about that too. Like, I'm gonna go in a cave and I'm gonna reinvent myself and learn this magic superpower, and I'm gonna train in the mountains where nobody's looking, and then I'm gonna come back stronger.

Yep.

It may not have felt that way at the time, but it—

like, I kind of knew it was supposed to feel that way. And then day to day, there was some amount of like, I spent more than my like daily cash allowance, you know? But like, I kind of knew that's what a better version of me would feel. But practically, I knew I was a person who benefits from structure and isn't always great at doing for myself. So what I did was a friend of mine had just sold a company to eBay New York and opened up this, this big space in New York that was actually right across the street from the USV office. And so I got up every day and I got dressed for my job, and I basically walked to the same place, but I went in a different door.

And then I sat with those engineers, and they actually dressed up, by the way, because I feel like there's psychologically something to actually dressing Like you're going somewhere.

Yeah. I mean, to dress up, but it was like, I did not wear pajamas.

Right. Right.

Like, um, yeah. Yeah. And then I'd go and I'd, you know, show up in the morning and I'd like do my Udacity tutorial or try to understand, you know, JavaScript to varying degrees. And then like go home at, you know, 6:00 PM or 7:00 PM. And then often I like keep doing stuff, but basically it was like tricking myself into acting like I had a job so that I got up every day. I was there by 9:30, you know, I was just doing the things. And I, and I do remember there was a time my family took a vacation that I went along with in January, and I came back tan, and everyone was like, where were you last week? Like, basically, like, why weren't you at work? Why are you tan? And I would be like, I'll get paid for this. You know, like, I don't want to show up. Everything is PTO to me. But it was also like, oh, yeah, I got this. That was kind of like a fun moment, too.

Yeah, I like that. So you have this era, which is kind of like in the movies, it's the montage. They just fast forward through this part. It takes 2 minutes, even though in real life it's 2 years. And you have this thing written on your site that I love, this quote. And I think in my research, this was my favorite thing I pulled from you, which was at the top of your site, it says, the function of the overwhelming majority of your artwork is simply to teach you how to make the small fraction of your artwork that soars. And this is from a book called The Art of Fear. Can you, I love that. Can you, can you explain that?

Yeah, I think it's deeply true of creative projects and I think startups or businesses or, you know, internet art is all like, they're all creative projects. One thing I learned at USV, seeing people bitch, but then, like, hearing the stories behind their big, you know, Tumblr, Twitter, Foursquare, or whatever, all the big successes of the era were— when I walked into USV, I was like, everyone is Mark Zuckerberg. Not actually, but, like, everyone, you know, like, startup founders are people who have an idea.

Visionary.

And they go into their room and they build it and everyone uses it. And it's, like, the first or second thing they've done. And, like, Facebook Picker, but that was kind of all of Mark's projects. And so, like, That's the way, you know? And, like, I was kind of like, "Shoot. I'm, like, not— it's never worked for me, so I'm probably not one of them." And USC was just so helpful in disabusing that notion and being like, "Look, some people— like, a very small number of people can do that, and that's incredible. I wish I were them. I'm not. Most people actually try a bunch of stuff, and eventually something might work, but it's, like, at best thing 5, and it might be thing 55. But no one really talks about that because it's both— because it's, like, painful and kind of not fun. And, you know, it's supposed to be romantic, but actually it just kind of sucked. Hungry for 2 years, literally and metaphorically. And it's so much nicer— like, you get so much praise for sort of being, like, the brilliant person, right? And that's the expectation too. I think I just had a, like, well, yeah, but, like, that's discouraging so many people from starting.

It's sort of like when you watch a bunch of movies about love and then you're like, this is what it's like. Yeah, I will bump into a stranger. Our papers will fall on the floor. We'll swap a paper. We'll swap a paper. He'll have to come find me, but then I'm not into him, but he just pursues me anyway. And it's like, if you have that notion that that's how it goes, you'll almost count yourself out of other things that could have worked otherwise. It's like, very that, you know, if you watch The Social Network, you're like, that's just how it is. Brilliant genius has, has a vision. Does it, takes off, and then he rides that bull, uh, you know, at the rodeo. All right.

So when I ran my company, The Hustle, I think we had something like 2 million subscribers and we made money through advertising and we didn't actually make that much money per person reading the newsletter because advertising in general is kind of a crappy business model. And so I remember sitting down and I'm like, what are all the different ways that I can make money off The Hustle that aren't advertising? And so to make sure that you don't make this mistake, Sean, me, and the HubSpot team We went and looked at a bunch of different ways to monetize your business, and we put it all together in a really cool document where we lay it all out along with our research. And we call it, very appropriately, we call it the Business Monetization Playbook. Go to the description of this episode and you're going to see a link to that, uh, Business Monetization Playbook. It's completely free. You just click the link and you can see it. Back to the episode.

We actually, after I read this quote, on my team, we started using this phrase just called bad art. So I'll hit up my team in the morning. I'll say, hey, let's make some bad art. Like intentionally just almost lower the stakes instead of we have to find the next big winner idea, right? Let's just make some bad art today. And the analogy I gave them, I said, imagine like, you know, you go to a hotel or a motel, you're doing something, you're going to a place that you've never been before. Maybe nobody's been there before. When you turn on the tap, like it's muddy water at the beginning. And if you look at that and you're— it's like you're mortified by it. It's disgusting. You'd turn it off right away and be like, ew. Bad, right? Leave. But if you know that actually that's the process, that you sort of have this muddy water of bad ideas and bad skills at the beginning, get it out of your system, then suddenly the water starts running clean. And I think that framework is, is just very useful for anyone who's doing either creative endeavors or startups, which are a pretty creative endeavor too.

Do you know the story about making pots?

No.

From the same book. So, uh, and I think it was like around the chapter where that quote was, but anyway, there's an art teacher And he said, "Okay, art school, pottery class. You have one assignment all semester. You have 5 weeks to make the perfect pot. You can turn in as many pots as you want, but I will judge them all, and the highest grade will go to the person who has the best pot." And student 1 spends all semester crafting the perfect pot and hands it in at the end. And student 2 makes 2 pots a day. And they're all bad for a long time. Right. But over the course of the semester, hands in whatever, like 300 pots and like, who gets a better grade?

Of course, the 300.

Right. Yeah, yeah. But it's like that concept. It's like so true.

And you have to live it almost to really internalize it.

Yeah.

Actually, a great thing I did once with my company, there's, you've probably seen like the marshmallow test, like the psych test with kids. It makes a good point, which is you give a bunch of supplies to, you break your team into a bunch of groups, groups of maybe 4 or 5, and they get like sticks of spaghetti, 1 marshmallow, and there's something like, uh, maybe a string and like 2 other things, like a piece of tape. And so the idea is, hey, uh, you have an hour. At the end of the hour, I will come around, I will measure whoever from the tabletop has the highest marshmallow. So whoever could build the biggest tower wins. And what most people do, what my team did, and everybody who does this the first time pretty much, is you immediately go into like the way we do most things in corporate life. So it's kind of like, okay, you're in charge, you do this, you sort of segregation of duties, you start trying to like plan and then you— so you sketch a little bit, then you start building the tower and at the very end you're like, okay, okay, it's almost time. Put the marshmallow on and the entire thing collapses because even though a marshmallow looks so small and like light compared to spaghetti sticks, it's way too heavy. And you don't realize that because you didn't like You like backloaded the possible failure, you know, the failure mode or the sort of test of the, of the idea. You spend all your time kind of planning and architecting this brilliant, beautiful thing. And the, the cool thing that they've shown in this is that when they do it with kids versus adults, the kids right away either eat the marshmallow or put the marshmallow on right away. And they're like, oh, it's too heavy. You have to have like 5 spaghetti sticks to hold this thing up. They figure that out right away. They don't kind of save that to the end to try to perfect it.

Yeah.

And that sort of iterative thing about testing the riskiest assumption.

Yeah.

Is, is maybe important. It seems like for you, did you make that mistake of kind of like overanalyzing, overplanning at the beginning, but like not testing with customers?

Less the very beginning because at the beginning I was just building— I built a book website. It was like Goodreads but better, but it was actually worse because I didn't know what I was doing. And but like it was something for me. This confused everyone else, right? Because they'd be like, well, you're not, you know, what are you doing without having a job? And I'm like, I'm building a book website. And they'd be like, are you gonna compete with Amazon? No. Like, are you gonna compete with Goodreads? And you're like, well, you know, with my friends, but like, no. You know, and then they'd be like, well, what would you say you're doing? You know, and you're like, mostly battling JavaScript errors, trying to, and like spending a lot of time on Stack Overflow. You know, but anyways, this is a whole confusing thing. But the beginning, it was just, I like, like when I would go visit a friend's apartment, I'd always like be drawn to their bookshelf. You wanna see what's on their bookshelf. Anyway, so I was like, okay, what if I can get everybody's books online? But it was like, clearly this is not a business, right? Like best case I'm making like $50 a month, you know, Amazon referral fees, like not a business.

But you did it anyways. Why?

Because I wanted it. I want, and it was a good, it wasn't, you know, like you do their initial coding tutorials and you like are making whatever the other person wants to make, which is not what you wanna make. And like, I actually wanted this thing. And it like forced me to be like, oh, you know, now I want like an animation when you shelve the book. So you, right. And then you'd like learn about CSS animations, whatever it is.

And so you, so you started building stuff for yourself. Yep. Did you ever switch gears to, okay, now, now I'm gonna do the startup startup.

Yeah.

I'm gonna do the thing that might actually, yeah. You know, get me out of poverty, like self-induced poverty basically. Yeah.

So at that point I was very like, look, I, you know, just taught myself how to code and like, you know, am I that good? No. But, learning how to do some of this is much harder than it should be. And a lot of it's because our programming tools make us, like, hold everything in our heads, and you have to teach yourself to think like a computer and, like, read through code, which is, like, not how a person— anyway, think like a computer. And once you have that, everything gets easier. But, like, why? We are typing on computers. And so I kind of got on this, like, uh, if we could make our programming environments better, you can, like, more— they will just make more sense, and more people will, like, learn to code. And so, you know, I was really into that personal problem. Also the, like, you know, live in the future and build back, you know, whatever, all the startup trope advice.

I'm curious about that. What startup trope advice actually helped you?

I think the build something you want is a bit of a red herring. It works in some cases, but you're also very limited to your experience. It's kind of like when they tell writers, write what you know, and then you like, you know, it's like a 14-year-old who's had a charmed life and like they just don't know that much. And so like, what are they gonna write about? And so my version of that is, like, look, if there is something personally meaningful, like, by all means go for it. Right.

That's top-ranked.

Totally. But, like, second best is, like, find someone else with the problem and deeply, deeply understand them. I think there's a ver— the shut your eyes, imagine the future, what's it look like, build that. I think this makes sense in retrospect. I think in the moment it's pretty hard to generate reasonable startup ideas during that.

Right.

But I can tell you a story about Vanta where Vanta fits that. Yeah. And it does, but it's—

but that's in retrospect.

Yeah.

So what was the actual in-the-moment way that you stumbled into this idea of Vanta that now seems obvious, as all great ideas do once they exist? And now there's you guys and some competitors trying to do the same thing. But that was kind of a novel idea and it was a new part of the market at least.

Yep.

What was the insight for that?

The insight was wanted to start a security company that started serving startups. There seemed to be like security was this huge market, but no one was really focused on startups and startups didn't use security tools. And I was sort of like, why? And like, when does this become a $90 quadrillion— like go from a zero TAM to like $90 quadrillion market size? In precise terms.

Yeah, that's the official number.

Yeah, exactly.

Um, but wait, why security? Because like, you know, when I'm talking, I've been talking to you for, I don't know, 20 minutes now. You don't strike me as somebody who's like, I wake up every morning and I was thinking about security during that year off. What, why did you even think about security to begin with?

Um, it seemed really interesting. It seemed like this kind of competitive cat and mouse thing where they, uh, with attackers where there's like kind of a real dashboard.

Right.

I think one of the things I've, I mean, I guess I knew, but I didn't really know, like I'm very competitive, should have played more sports as a kid, didn't, uh, through Vanta have an outlet for a lot of that energy, which is great. And I think honestly, when I was at Dropbox, I worked with this product security team and they were great. They were super fun and they were really good educators. And it's not like they'd hosted seminars on things. It's just like they wanted you to fix something, but they'd come over and sit next to you and explain why it was important and how and all the— anyway, they were just great. And so in coming up with startup ideas, there was a bit of like, well, this actually seems like a deep enough, interesting enough space that if I work in it for years, there'll be lots of things. And if I can't come up with anything and end up burning, you know, 18 months of my life learning about security on the internet, could have been worse.

Yeah.

Right? Like, you kind of look back and be like, okay, worst case, nothing comes out of this. But like, I, you know, I'll feel as good as I will.

Well, connect the dots for me. So you, you took the year or multiple years off to teach yourself? 2 years?

Yeah.

But then you go to Dropbox.

Yeah.

So you go back to getting a job.

Yeah.

So I feel like we, like, there's a part of the story that's like, I iterated, iterated, iterated, finally I found it. No, no, no. Finally you found a job at Dropbox.

Yeah. Cause I was kind of like, Okay, now I can code, but I've never had a real job. I've never worked at a company. I've never worked with people. Also, my, my, like, friends are kind of getting promoted and, like, I can, you know, like, it's unclear if I'm employable. Like, this seems bad. And I was really frustrated because, again, the, like, I wouldn't tell people I wanted a startup to come out of that, but, like, I did. But I also, at the time, was like, well, nothing I've worked on should be a startup. Right. So like, yeah.

So what, what was that story you told yourself? So you, you spent the 2 years, you bet on yourself.

Yep.

Which sounds amazing. That's a great t-shirt. Bet on yourself.

Yeah.

But the reality of it, I do it for, I told you I did it for 8 years. Yeah. And I was delusional enough to keep going.

Yeah.

But also objectively it was bad and I should have, I had to tell myself certain stories in order to either A, keep going or to like just maintain a self of a sense of confidence.

Yeah.

Beyond that? Because the evidence was telling me you suck.

Yeah. Yeah.

And I just couldn't tell myself you suck cuz then I definitely suck. Yeah. What were you saying when the evidence kind of said you suck?

This is very silly. I had this like survey I would fill out, a Google form I'd fill out for myself every Sunday or every weekend. What are you working on? How do you feel about it? What are you gonna like, what's your next goal? What are you gonna do to move forward?

You made that for yourself?

Made it for myself. It was like a personal accountability thing. Right.

Okay.

And I asked a bunch of questions. They were all useless. The only question that ended up mattering was, "What would make you stop working on what you're working on right now?" And to your point, turns out my present self always thinks I should keep going. But my past self sometimes thinks current self should stop, right? And so it was actually, like, looking at those answers and being like, 2 months ago, I should— said I should stop if I got to the point I'm at now. I don't actually think I have countervailing evidence. I just have stubbornness. Shoot. I should probably stop.

And so that's how you were stopping those projects. Yeah. You— when we— I sent you some questions ahead of this to try to understand what you think is important to talk about, what do you think is insightful. You said something that I really resonate with, which is managing your own mind, managing your own psychology is one of the most important things.

Yep.

Um, how does one do that? And what's like— how would you teach that to somebody else, or how would you talk about that to somebody else?

It's, I think, hard to do, hard to teach. Um, I think what I try to tell people is figure out what— like, it's, it's personal and not personal sensitive, but like personal, like specific to you, and figure out what makes you happy or centered. Whatever those things are, and, like, do not give them up. And so for me, for years, it was, like, you know, running 3 or 4 times a week. And, like, exercise, sure, but it was actually just, like, the mind-clearing, catharsis kind of meditative, like, running. And, you know, it was, like, running for me but, like, whatever for someone else. And it's like, whatever that thing is, do not give it up. And I don't care how busy you get, but sort of know what makes you feel like you. And don't drop those things.

Know what things make you feel like you, which is kind of like what you're talking about is habits and hobbies. Is that more of what you're thinking about?

Yeah, it's just like that feeling where you like, you're, you're like moving through the world and you like feel like you're at your best, you know? Like you're the best, shiniest version of yourself. It's like, what brings that on?

So for you, running is one.

What else? Running was one. Reading, like not in any— I mean, kind of an elegant intellectual way, but actually just because it is something I have done since I was 6 years old. Right. And so like, if I think of like hobbies or anything I've done through my life, reading is actually one of the biggest throughlines. And so there's a part of that that just feels like me.

Yeah. Cause I was looking, you read like, I don't know, like 30, 50 books a year or something.

Yeah. But it's, it's like, I mean, yes, I want to learn things and like blah, blah, blah. But actually it's just like, it is centering.

I feel like that when I was running a company and by the way, mine was not a $2.4 or $5 billion company. I was like, I have no time to read. Are you kidding me? There's problems everywhere. I'm drowning in problems. And Did you just replace TV with reading or something as simple as that? Yeah.

Like actually.

Eric told me that you are like extremely quick with reading. He's like, she would take a bus to work.

Yeah.

And read the book and read the whole book on the bus ride.

Oh yeah. I mean, over the course of a week or so, but yeah, like, uh, actually to this day, the way he said it was more legendary.

He was like, nah, to and from COVID to cover.

No, I wasn't at it. I actually still take a bus to work. Part of it so I can just sit there and like—

You bus to work?

Yeah.

Oh, that's interesting.

'Cause look, if I take a car, I'm just gonna like sit in the back with my laptop writing emails, you know? And then a bus, like, I'm on San Francisco bus, I'm not pulling out my laptop on that unless something's like really gone wrong. And so it just forces me to like sit there and have 20 minutes between home and work.

Right.

And I like that much more.

It's almost like, you know how people are like obsessed with cold plunges?

Yes.

I think the more hardcore version is take a San Francisco bus to work. Take a bus. It's like, wow, you can endure a— 18-minute bus ride with like—

some of the buses aren't bad. 5R used to be my bus. 5R was like great.

Dude, I used to take the 38 and the 38 is like an actual zoo. It's like anything can happen.

Yeah, yeah, yeah. No, 5R, great bus. I miss it. I miss it.

Okay. So, um, so Banjino psychology, you said, uh, figure out what makes you feel like you, most you, and make sure you stick with those things. Keep doing those things. It'll kind of keep you, you centered with it. What about manage your own psychology when it comes to self-doubt, when it comes to getting down on yourself? Because I spent 2 years, I didn't really land where I wanted to land with it. Did you have a conversation with yourself there or a story you told yourself in order to—

Yeah, I was so annoyed. I was, which in retrospect, I was like being so pretentious. Like life was good. You know, again, like the, the batna, like my worst case outcome was becoming a product manager at Dropbox, at the height of Dropbox's power. Like my life was great.

Did you just say the batna?

Yeah, right. But like, my life was great. It did not feel great at times. It was totally great. And again, I knew I was like 5% aware of that, 10%, but that was not the lived feeling.

Do you use negotiation terms like that just regularly?

Hopefully not. That sounds kind of obnoxious. I'll try not to.

No, I like that. I've always felt that if you build a great Silicon Valley company internally in your company, you should be a totally normal person, but outside you should have that like 10% crazy. Yeah, it just gives you like actually like 2x the valuation. It just creates this extra aura. It's like, true.

Wow, she's, she's barefoot all the time. Wow.

Interesting. She must be one of those real outlier types.

Oh my gosh.

All right. I wanna ask you about this list of ideas that you did. So I've looked back in my career and even when I went through eras where I tried something and it didn't work, a lot of the times I look back with the benefit of hindsight now and I think, oh, I was just sort of an idiot about it. Had I actually either stuck with it or done it differently or pivoted the market, that actually was a good idea.

I'm curious, do you feel that way about any of the projects you worked on?

No.

Um, like they're art projects and I say that with deep love, but like they're not businesses. Okay.

The voice assistant for biologists. Yeah, that doesn't sound like a great business.

That was just comically bad. No, yeah, there was, like, a deep lack of any commercials in nearly everything on that list, which I think is part of why Vanta has had commercials, like, baked in from the very beginning, because I'd made that mistake so many times.

What about now? So if you— if you weren't doing this, or in general, like, when you operate a business, you see a bunch of pain points, blind spots, maybe like parts of the market that are unaddressed. If somebody is listening to this right now and they are looking for, you know, inspiration or ideas that, you know, spark thoughts in their head about stuff that they could go do, where would you look? What would you recommend people think about? What problems do you think need solving?

Yeah, I think so. So much of what I think about that's not kind of directly in Vanta's wheelhouse is something around like running a B2B SaaS or being in a B2B SaaS business. Forget running it, just being in it. There's like so many, like someone please fix the go-to-market tooling stack. There's 9,000 tools and none of, and it's like you jerry-rig them together in this Rube Goldberg machine and the marbles are all up on the floor and like, if anyone wants B2B SaaS, just like fix that, go full stack on all that. But for people who don't want B2B SaaS, which there are hopefully many, I think the Process Vanta came out of— I mean, I of course, like, I mean, I liked it going in, but now of course I really like it. But that was pick something you want to learn about and just go talk to anyone you can about, like, what their days are like, what their problems are like, just like what's going on and kind of try to develop a mental model of the space.

The story I heard about Vanta, which sometimes we make up these retrospective stories. So I don't know. You tell— you can—

I try to actually tell the true one.

Like, blink twice if it's true.

Yeah, whatever.

But it was, you're at Dropbox, you work on this thing called Paper, which was this, I remember like seeing Paper at the time was like this idea of this like collaboration tool. And you go to one box.

Dropbox is version of Google Docs.

Yeah, Dropbox is Google Docs. You go to launch it and it's like, hey, we don't have SOC 2, so can't really launch or customers can't use it. And you were like, SOC what?

Yep.

And you didn't know really what that was. And you were like, so how do we get that? And you started asking questions to try to understand like, what is this thing that blocked us here? If it blocked us, maybe it blocks other people.

Yeah.

Dropbox had a security team that was going to be able to try to solve those problems. But like the average startup doesn't.

Yep.

And the next part of the story that I liked was even though you had just spent 2 years learning to code and built 35 projects and coded them up and shipped them out there or whatever, you didn't write code for this. You were like, I'm going to test this idea with an Excel spreadsheet only.

Yeah.

And you went to 1 or 2 startups, I think YC startups that you thought might need this. And you were like, hey, if I did this for you, would that be valuable? And they're like, ah, yeah, sure. Can you— how much of that is true?

All true. Um, the stylized part is all that Dropbox stuff happened. There was no light bulb. I was like not smart enough to have a light bulb go over my head at the end. Wish so, but it was just like learned about the whole process, learned what it would take, and then like basically ran screaming from the room because it just sounded awful, especially when we were trying to launch and even figure out if we had product market fit. To the idea of like, we're gonna go 2 years of work to then see if we have product-market fit. You're like, bad, bad. Like, how do I find reality faster? Came back to it later, did the spreadsheet thing. And I think honestly it's like, 'cause there's 35 things on the list. Like, it's kind of at the point where you're like, okay, I can write, you know, maybe somewhat shoddy JavaScript, but like I can code the thing or code a first version of the thing. That's not the hard part. The hard part is, does anyone want my thing at the end? And so like how much of the validation can you frontload there?

So I think a lot of people hear that and they're like, they hear you should talk to customers, you should validate if people want this, make something people want.

Yeah.

I don't think anyone has any idea how to actually do it. So what is the quick and dirty recipe for how you actually go? Who do you talk to? What do you really ask them? How do you make sure you're not getting these false positives just by being like eager beaver? And they're like, yeah, that would be— maybe I'd be interested. Um, and you're like, they totally loved it.

Yeah. So on the false positives, anything that is not, can you do this for me now, tomorrow, next week, is a no. And people are really kind and they want to be kind. And so they don't say, like, rarely do they say no. But a lot of like, oh, maybe next quarter, like, I don't need this, but my friend might. Hard no.

Yeah, you should date my friend.

Hard no.

Totally.

Hard no. Um, I think on who to talk to, I mean, look, we started with like anyone who would talk to us and then it was just like And then, so it ended up being coworkers, former coworkers, because you had like some like, well, I don't know if you know anything about this topic, but you're kind of a nice-ish person, and so I'll like give you a half an hour sort of thing. And then just fan out from there. At the end when they're like, well, you know, you ask them, do you have anybody else? And they list people and like say yes, follow up with customized emails they could forward, you know, like make it easy for them and just keep going out.

Yeah, I think that's an important one. Make it easy for them to do the thing they said they want to do.

Oh yeah, like follow up and be like, thanks so much for meeting me, like I would I would love to talk to your friend who, Eric, who said this, like, here's what I'm working on. Like, and just like assume they will, like write them an email, they will forward.

Exactly. Yeah. So you, um, have you ever read this thing called The Mom Test?

Yes.

Uh, do you subscribe to that?

Yeah, generally.

Yeah. They, uh, that was helpful to me when it was, there's only, I don't even actually remember what was in the book. Only one line, which was they can't tell you about the solution, but they can tell you about their problems. So all your questions need to be first about their problem. And then at the end, if you want to ask them about your solution, great. But just assume they don't really know what the solution needs to look like.

Yeah, I think that's true. Try to avoid yes/no questions, uh, which is harder than it sounds. And there's a bunch of kind of user research tips, tricks of like, if somebody mispronounces something, go with their pronunciation, otherwise they're going to like—

don't break rapport.

Exactly, exactly.

Like, a lot of— actually, I think I do that. And it sort of is like a problem because it's kind of a know-it-all move.

Right.

And then it makes them feel like their mind goes over there.

Exactly.

Oh, am I, am I being stupid? Did I say something stupid?

Exactly. Where you just like want them to like stream of consciousness at you, basically.

Yeah, exactly. Do you have any good hustle stories for how Vanta kind of got the flywheel going? Because, you know, startups don't kind of just like explode right away necessarily.

Yeah.

And I've seen your like ARR chart, which looks like a beautiful hockey stick.

Yeah, totally.

But if you zoom in, it's like, wow, that was a year where it's like pretty kind of small. And then, then it started to accelerate. Was there anything you did that you felt was interesting, unique, um, that kind of took hustle and creativity?

It's so funny looking back because like I sent a bunch of outbound emails to YC companies, but I didn't know the word outbound at the time, right? I was like emailing YC founders for feedback and I legitimately did want their feedback kind of to this, but it was like half a leg. Okay, I'm gonna spend, you know, 60, 70% of the call talking about the problem and how you're solving it. And then at the end be like, I am building a thing, would you like to hear about it? But it was like totally cold outbound, you know? I just like didn't know that word.

So you emailed a bunch of YC people.

Yeah.

That got the ball rolling. What happened after that?

Honestly, the early strategy was like, just do and try everything and then see what works.

So what did work?

The outbound worked. There was a word of mouth. We tried actually really hard in the early days to basically build this call response in like founder Slack channels or VC Slack channels where someone said Soc2 and someone else would say Vanta. And you just wanted this, you know, Soc2 and Vanta.

You're saying like build the brand in people's minds.

Yeah. And that was great for a while. And then, uh, a bunch of knockoffs came and there's a bunch of other ways to get Soc2. And so that, that association—

I remember you guys had a billboard. It was like, uh, what is it? Compliance that doesn't Soc2 much. Yeah.

Still up.

That was good.

Still up. Um, Uh, yeah, I joke with people like, we make software, but like, we also make a billboard, and we're equally known for both. They're like equally as important. Um, what else? Uh, podcast advertising really worked in— I mean, actually it still really works, but like really worked in the early days. I thought podcast advertising was just gonna be like sending money out the window. I was totally wrong.

And that's what happened? Somebody on your team pitches you this? Eric pitches you this?

Eric was like, I want— 'Uh, $20K, go on Twi— This Week in Startups or something.' And I like rolled my eyes and said, 'Fine, whatever, go.' Totally worked. She was totally right.

Eric is like this mythical figure to me now where I've only ever heard great Eric stories. And so I don't wanna hear any— if anybody has a bad Eric story or an idea he had that didn't turn out true, don't tell me, please.

No.

All right. I wanna ask you about a couple other of your controversial or maybe just less, um, consensus opinions. I've seen you write these somewhere on the internet. You tell me if you still believe these and why. Consistency is overrated. This is on your website.

Oh yeah, and people feed a lot into this. I'm just like joking with myself because I say contact me through these 4 ways that all have totally different names on them.

Oh, okay.

So like, this is like minor—

Naming consistency is overrated.

Yeah, this is like minor self-awareness, um, thing that I think people think is meant to be a broad philosophical statement. Do I actually think it's a broad philosophical statement? No, probably not. I think Vanta's taught me consistency is actually underrated.

Yeah, I was gonna say, you strike me as somebody who's consistency first.

Yeah.

Um, it's bad, it's bad when the goalposts move. I don't know if you're saying you think this or that other people think this.

I think other people do. The advice tends to be, right, like, you know, if your goalposts keep moving, it's hard to find happiness and like you're always something more.

Explain what it means. So like, what does that even mean? The goalposts moving?

Yeah, like, uh, I think, I mean, it gets applied in lots of forms of life, but like, let's take startup founders just because, right? It's like you want to start a company, you want to hire some people, you want to raise a seed round, you want to get to like a million in ARR. But then by the time you get there, you're like, actually, I want to get to 10, right?

Like, yeah, yeah.

And there's like always something you are chasing. And I think that is generally seen as a recipe for unhappiness, right? Like, why can't you be happy in the moment? You did this thing prior you thought was great. Like, why can't you? Think it's great. And I think that can be true in some cases, but I actually think— or I think that the, the trick is— slash downside is if you're like only happy when you hit a goalpost and then you're moving them, like you'll never be happy. If you actually just like the work, right? So it doesn't matter. And a lot of things are more sustainable when you like the work, especially when you have a lot of work to do.

My formula is progress equals happiness, which is that no matter where you are, it's sort of like the y-intercept doesn't matter, the slope matters. And so wherever you're at, if you don't feel a sense of progress in your life, you will feel unhappy and then you'll feel even worse. You'll feel guilty for feeling unhappy. Yeah, because you're like, I guess I do have all these good things in my life, but I still don't feel this way. I'm just fundamentally broken inside. I'll never be happy.

Right, right.

When in actuality it's just a sense of progress. Even better, a sense of progress in a direction that you have set out intentionally that you care about.

Yep.

Um, and I think that in that sense, moving the goalposts is great because you're saying, I would like to continue making progress. I enjoy progress so much. I, why would I stop my progress? That stops my happiness. It's a different way of looking at it.

Do you remember, deep cut, 10, 12 years ago, Jess, who's the founder of Polyvore at the time, now Sequoia, wrote a blog post about founder psychology?

No. What did it say?

It was like, why, basically like, why are founders always unhappy? And she's like, especially when their companies go like this, and it was a line up into the right. And she's like, because if you zoom, you know, again, y-axis getting higher, like, what is this? You know, because if you zoom in on the graph, it doesn't look like a, you know, 45-degree angle. It looks like a roller coaster that is going slightly higher, right? But it's like the roller coaster along the way. And like, you know, again, even when you zoom out and you've got this lovely 45-degree line, the downs hurt every time.

Yeah, it's the peak to trough that you feel. You don't really even recognize that you've gotten higher progressively each time. You also have another one, which is high standards are bad. You think that in generally— you said people don't say this, but they imply it in different ways that, you know, don't have such high standards.

Right.

What is— what's a situation where that's come up for you or you felt that?

I think a lot of Vanta stuff, and I think within the company and then with you know, kind of partners or folks outside. And I mean, some of the feedback we get that, like, I kind of— I don't appreciate more than anything else is, like, people care, people respond super quickly. Like, you know, again, something might have gone wrong, but the person tries really hard to fix it, right? And I think those things definitely don't happen everywhere by accident. It's not to say I had— I mean, hopefully a small role in it, but I think when people join, there's a little bit of like, oh, the bar is here at Vanta. Like, kind of scary. Did I join the right place? Like, what's going on?

What's an example of that? Where would somebody feel that?

A couple places, but I guess in go-to-market, our expectations around quota, around attainment, on that, they're way off industry. They're way higher. And I think if you just, if one just hears them in a vacuum, they're sort of like, What is what? Like, why would I sign up for that? Then they join and it's like, oh, 'cause you're surrounded by people who are like into what they do, getting better every day, want to get better every day, care a lot. And that sort of environment can be like really infectious.

I'm curious, did you ever read this leaked production document from MrBeast? Did you ever take a look at that? Did you see that going around like a few weeks ago?

I know.

You know who MrBeast is?

Yeah, yeah.

So like right around the same time that Paul Graham put founder mode out there and everyone's like, oh, founder mode. Like, but wait, what is it exactly? And like, you know, it was like, I think yes, but what? Um, part of a lawsuit, MrBeast's like internal doc he wrote for his production team leaked a big part. Like we've gotten to know him and become, uh, you know, pretty friendly with, with Jimmy over time. And it's just stunt, like the, the number one thing you go hang out with Jimmy for a couple days, like you walk away and you're like, oh, he, that's what people, that's what it means when people say reality, you know, Steve Jobs used to have this reality distortion field.

Yep.

And it's, and literally he, he, his company's based in like a tiny town in North Carolina. So like he gets people to move there and then once you're there, you're in his bubble and in his bubble, the expectations of what work is about, what success is about, what we're able to do about the timelines we do them on, about what it means when something says no, not possible. And he's like, like one of his things, he's like, push past the no. He's like, you know, you have to be able to push past the no. You don't always have to get it to be a yes, but like, if you just come back and you said, oh, we, um, you know, we asked for the permit and they said it's going to take 6 months. And he like, that can't be the end of the story. And we saw it on every little thing. Like, for example, we wanted to play basketball the next day and it was midnight and somebody was like, oh man, I can't wait till tomorrow. Like, I just want to play. And he goes, well, why do we have to wait? Like, well, it's midnight, Jimmy. What are you going to do? He's like, I'm sure there's a gym around here somewhere. Let's go. Let's go find one. And we're like, yeah, but they're going to be locked. It's midnight. Like, schools aren't going to be open. He's like, call the athletic directors. He's like, just call all of them right now in the county. It'll take us 20 minutes and offer any of them $1,000. See if they'll come open it. And like, part of it was like, oh, he just throws money at every problem. But actually, it's not about throwing money at it.

It's—

yeah, everybody else would immediately just default to like, this is not possible, not feasible, not going to be doable. Whereas his default assumption on any given thing is like, why not? Of course we could do that. Yeah. It's just a matter of deciding if we wanted it, we'll do it. If we don't, we won't. But that's it. And then you just see that time after time after time hanging out with them on big things like, you know, the videos that they're gonna go shoot, but the small things. And it's just a different gear. It's like, oh, your gear is like, my, my stick shift only goes to 6. Yours goes to 9. Okay.

Right.

If I'm gonna hang out with you, I now need to decide like how I'm gonna get to 8 or 9.

Yeah.

Because otherwise I'll just be sticking out. Yeah. This won't be the right place for me.

Yeah. Yeah, totally. And I think there's a, I mean, I think also if you like experience that and you're like, you know what, I'm go with 6, right? Totally reasonable decision. Like, not that, you know, arguably maybe a better decision in some cases, like totally fine. But the, the like, there might be, there might be a 9, um, for any given thing, I think is a helpful mindset.

You also raised a bunch of money late, so you didn't raise early on. You got to $10 million in ARR before you went and raised your Series A. Yeah. I'm not so curious about as to why you did that because I'm guessing the answer is pretty simple, which is like we didn't necessarily need it. We just stayed focused on selling the product that was working. Um, but more so when you went to go do it, what was that experience like? Because you had leverage.

Oh, it was really fun. Yeah, it was great. Um, it was really funny. So people, or VCs in San Francisco broadly, like knew we were doing well because of kind of the Slack channel chatter, like Advanta had come up. But they sort of didn't know how well. And so there was one pitch meeting. I remember what they—

and sorry, you kept it low-key, right?

Yeah, I kept it low-key on purpose because basically we were like, we have this great idea and everyone else thinks they can't even like spell what we're working on. Think it, you know, has Ks and do things on your feet. And I would rather they not know because then somebody's going to start knocking this off and copying. But anyway, very smart VC, very good at his job. And I'm like, "Go and pitch." And I start walking through the slides, and I get to the ARR ramp chart, the, you know, 10 at the end of it basically. And his jaw just drops. And he was, like, clearly speechless. And he's looking at it, and he's like, "I thought you were at, like, 2.5." And you're like, "No, that was, you know, the, you know, 10." And anyway, I was like, "Keep going." And at the end, he was sort of like, "We're, like, not gonna— like, we missed it. Like, we're not gonna be able to do this. I can, like, try to introduce you to someone else, but, like, you know." It was fine. Like, you know, there were other people, but it was this kind of interesting pitch much experience. Um, and then basically I go into a meeting with another VC who's very good at his job, and he's like, you know what, thought you were at 9.4, because I'd like taken your Twitter chart and backed it out and taken the board and like counted the pixels.

I did the proportions. She said 10, so if this is 10, yeah, where was she a year ago? Yeah, 2.7 or whatever. Totally.

He had basically done that, and that was also— you're like, oh, this is great. So good at your job. So fun.

Is that who you end up going with or no?

Uh, no.

Look, you're great, but Sequoia's calling. See ya.

Um, no, but I think actually it was still the goalpost stuff and I'm, you know, not very good at celebrating, but it was a moment where I like took a, I mean, a beat, like a week and I was like, no, I am gonna like tell this story and what we've done and like, I'm deeply proud of it. And I would've told you that, but now I like feel overwhelmingly proud of it. Right. and like, here's how the pieces fit together, here's how they will fit together, and I believe it. And so that was just— then it became like, uh, I still kind of hate fundraising, but it was talking about something I believed in, which is fun. Right.

Eric told me that he thinks you're great at negotiating. You said—

so funny.

You said, uh, that's surprising to you. Yes. But he, he was not, uh, he was not wishy-washy about it.

Yeah.

He's like, she's incredible at negotiating. One of the best I've ever been around. Ask her how or why she does it. So no pressure.

Yeah, no, it's like really surprising. I think if I'm confident in it, I'm actually confident in it, and then we'll just stand and like not blink, not swerve if we're playing chicken, won't eat the marshmallow. It's like, I got it. Like, let me know when you want these terms. I'm happy to sit here and wait. And actually, truly, I'm like happy to sit there and wait at that point. So I think it's just a lot of that. It's like, I won't— if I believe it, I won't flinch.

Cool. Well, thank you for doing this. This has been amazing. Um, Where should people, you know, find you, find Vanta, maybe give it a shout?

Yeah, vanta.com, V-A-N-T-A dot com. If you need any help with anything security or compliance related, we would love to help you out.

Awesome. Well, thank you for doing this.

Thank you so much.