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Transcript of our conversation with Waseem Daher:
00:00:00:00 - 00:00:12:11
you have to sort of have both conflicting thoughts in your head at any given time. And I think that's that's very key to the alternate experience. You have to believe you can do it, but you have to soberly confront all of the ways in which it might not work.
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00:00:14:14 - 00:00:16:07
00:00:16:07 - 00:00:37:10
Unknown
Welcome to the Founders in arms podcast. I'm Raj Suri, co-founder of Lima and Tribe. Today we have Waseem Daher, co-founder and executive chairman of pilot. And Immad cannot make it today. He just had his third kid. He will be here next week hopefully. I'm not sure how long his time off will be, but, Congratulations, Immad Please.
00:00:37:12 - 00:00:49:12
Unknown
If you hear this, send him a tweet and we're congratulating congratulatory note. And, welcome, Waseem to the founders in arms podcast. You and I have known each other for a while, and it's great to catch up.
00:00:49:12 - 00:00:51:17
Unknown
Yeah. Thanks for having me. Really great to be here.
00:00:52:05 - 00:01:02:19
Unknown
Yeah. And it's great to have you here. And, you know, you've done some really interesting companies, and, why don't you tell the audience a little bit about pilot, but also some of your other companies?
00:01:02:22 - 00:01:18:21
Unknown
Sure. So pilot does accounting and tax prep for startups and SMEs, and it was really born out of pain. We had no previous companies. And I think you probably experienced this firsthand. But anyone who has a company of any kind, whether it's a tech company or a coffee shop or doctor's office, there's some reason that you start your business.
00:01:18:21 - 00:01:35:07
Unknown
There's a product or service you want to bring into the world. And what you soon realize is, yes, of course you focus on that. But there's all of this back office stuff, and the back office stuff is important and scary and tedious, and you really just need a good partner to do it for you. And that's really where we come in.
00:01:35:07 - 00:01:44:07
Unknown
And we run your back office so you can focus on your business, really initially starting with what we call the financial back office. So accounting, tax prep, fractional CFO, that kind of stuff.
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Unknown
And, I mean, this was this is a very different industry than your previous companies, right? Like, you've done some really different things in your career. First of all, I remember his case plays well. Explain what that was about.
00:01:56:18 - 00:02:24:20
Unknown
You do has. So the three companies were very different. The first company case by it was my co-founder Jeff's master's thesis. And at MIT he had developed some technology that let you apply updates to a running system without rebooting. I'm sure you've seen that pop up. It's like you must reboot to install new updates. We had some tech that could take those updates and transform them so they could be applied on the system while it was still running, which is convenient for you or me, but is actually really, really valuable for server farms and data centers and that kind of thing.
00:02:24:20 - 00:02:45:23
Unknown
And we bootstrapped that company. We did it in Cambridge. We operated it for about three years, grid system figures and revenue, and Oracle acquired it. And basically a year and a day after the acquisition kind of got the band back together, said, okay, we want to do something new. The second company was a tool called zlib. It was a group chat tools and a kind of slack like app.
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Unknown
At a time when slack, I think, was still making a mobile game. We had a sort of opinionated take on what group chat should be like at work. Operate that company for a little bit. Under two years, Dropbox acquired it, and then obviously pilot is, you know, we're doing accounting and we're doing it a tech enabled way, like we employ a bunch of talented accountants, and then we write a bunch of software under the hood that we use to do the work more accurately, more reliably, more consistently.
00:03:08:00 - 00:03:24:22
Unknown
But there's not much of a through line between Linux kernel updates, business group chat and accounting and tax prep for startups other than these were all problems we ourselves had, you know, when doing the previous companies are kind of at various points in our lives.
00:03:24:22 - 00:03:43:14
Unknown
Yeah. I mean, it's, remarkable kind of how similar our journeys are in some ways, because I've. I've also done multiple companies now and done it for the same reasons, like, but we've done such different companies that were remarkably different companies. And, but as for the same reasons. So kind of shows how varied the founder journey can be.
00:03:44:04 - 00:04:02:22
Unknown
And I think ultimately, it's like you got to be excited about the team you're doing it with. And you, you know, you have to be passionate about the space. But I don't think you have to be like a travel founder or like a B2C founder. I think you are more versatile then than maybe you think. And so I think I encourage second and third time founder to lean into that.
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Unknown
I don't feel constrained by, well, oh, this is what I know and therefore this is what I have to do.
00:04:07:06 - 00:04:24:07
Unknown
What have you enjoyed the most? I mean, like, which parts of the journey have you enjoyed the most? And where do you feel like you like your your, like, arc has kind of evolved to like, maybe something in the beginning that you kind of, like, struggled with, but now you've figured out or maybe something you're struggling with now that earlier was easier.
00:04:24:09 - 00:04:27:10
Unknown
You know, I'm sure we can exchange a lot of stories here.
00:04:27:14 - 00:05:03:18
Unknown
Yeah, it's been interesting. I mean, we've been doing pilot since early 2017. So, you know, we're in year eight and I think it has been fascinating, kind of see the evolution of the company in the role in that time. And I think one of the things that's great and really fun about the founder role is you are constantly kind of pushed to the level of your own incompetence, like once you finally master it, if the company is growing while you're now playing a new game that you actually don't know how to play before, you haven't played before, and so there is definitely some intellectual satisfaction associated with just having to constantly level up because
00:05:03:18 - 00:05:16:13
Unknown
you have no option but to do that. Like the company needs you to step up and figure out the next thing. It's like, okay, you got to 10,000,000 hours are great. You know, how do get to 20? How do you get to 50? Okay, what does that imply about how you build and how you run the org, etc., etc.?
00:05:16:14 - 00:05:40:18
Unknown
I think the thing I didn't appreciate is actually it, it's I think it's really important for founders understand what they're good at, but more importantly, kind of like what gives them energy. And I think I have found a lot of joy in really the 0 to 1 kind of early days, like getting the thing up and running much more than I have.
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Unknown
Okay. You're CEO of the multi hundred person company, and your job is to kind of build the machine, to build the machine, like to make the organization do the right things. And that's like that's an important and worthy goal. And it's a hard job. And there are people that are phenomenal at it. It happened to not be one that actually was particularly a source of energy for me personally.
00:06:00:09 - 00:06:15:22
Unknown
And so actually, in 2024, my co-founder Jessica became CEO and I transitioned to, the executive chair role, which has been awesome. It's I'm really getting to spend time, really kind of in the trenches again, as are scrappy things, I think really move the needle for the business where I sort of uniquely have the context for it.
00:06:16:00 - 00:06:37:19
Unknown
But I don't think I would have expected that. I mean, I think many founders, you know, they start the company and they think like, oh, I'm going to be like Mark Zuckerberg or Jeff Bezos or whatever, like I'm CEO to the end. And I don't if that's what, you know, floats your boat, do it. I think it was interesting for me to realize, like, okay, I'm not sure I'm the best person on this job.
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Unknown
And even if I am, which I don't think I am, I think Jessica is doing it better. I'm not sure I even want it.
00:06:43:09 - 00:07:02:02
Unknown
Yeah. Absolutely I, I it again remarkable how similar you know your journey is to mine. I mean I, I also felt the same I, I really enjoyed the 0 to 1 aspect. You know and I actually think that Mark Zuckerberg and Jeff Bezos are not that different in some ways too. You know, if you look at Mark Zuckerberg, like what seems to give him energy is like doing new things within meta, right?
00:07:02:04 - 00:07:24:06
Unknown
And and same with Jeff. I mean, he left Amazon. He's doing a new thing now. I saw a podcast with him where he's like working like harder than you ever worked at Amazon, you know, on Blue Origins. And so it seems to give these folks energy is actually very similar. I have a theory that people like that stay in the CEO role for a long time, mainly to give the company some stability because they don't have a good successor.
00:07:24:08 - 00:07:42:13
Unknown
And, you know, I felt the same at Presto. So I you know, I left Presto after we were Republic and you know, I, I some point I also felt like I really wanted to do zero one again and kind of like experience that again. And I'm just really what I love to do. But at the same time, I felt like if I, if I would leave, it would create problems.
00:07:42:13 - 00:07:53:15
Unknown
And and I think that's, I think it's true that actually when, you know, in some cases, if you don't get the right successor, it creates a lot of problems in the company and it can kill a company. Yeah.
00:07:53:15 - 00:08:04:22
Unknown
Now, in our case, like, I think the reason it's so smooth, like Jessica was, I think, even more well-liked and even higher credibility than I was a pilot. And so in some ways, it like it made sense, like, for her to step into the role. I
00:08:04:22 - 00:08:13:07
Unknown
think if you were like, hey, here's some random new person I've never met before who, like, looks like a corporate type who doesn't really know what we're about, that's going to free people out.
00:08:13:07 - 00:08:13:19
Unknown
Yes, that
00:08:14:03 - 00:08:30:14
Unknown
Was she a co-founder. What was her. How did she get it. Okay. Right. So yeah that that makes a lot of sense I think that type of person can work. You know you've seen it go well in a few cases. Like Satya is doing great job at Microsoft. But it was interesting that someone like Ballmer couldn't do a great job, right?
00:08:30:15 - 00:08:49:08
Unknown
Like, even though he was there early. So it's the CEO role is so important. And I felt like, a big part of the CEO job that no one talks about really is like just preventing bad things from happening in the company. Like, and nobody talks about those. Everyone talks about what the CEO is doing, but very few people talk about what the CEO is preventing from happening.
00:08:49:09 - 00:09:05:07
Unknown
And when you have a new CEO in some cases, I mean, I would say the majority of cases, you know, the company can often go in like a wrong direction and just do things that don't make sense. And the company often doesn't know how to take on risk because, like, they take a risk on in the wrong way.
00:09:05:07 - 00:09:16:22
Unknown
Like, you know, you and I would be very comfortable taking on 0 to 1 risk. But like, someone who who's not comfortable with that would often let it either overwhelm the company or or not do it well enough to like make an impact.
00:09:16:22 - 00:09:21:10
Unknown
I think there's an advantage to having the moral authority to turn the ship.
00:09:22:22 - 00:09:33:10
Unknown
you have to say, hey, what we're doing is not working or it's not working as well as it could be working. And to really take it to the next level, we need to make a big change in how we do things.
00:09:34:22 - 00:09:41:16
Unknown
it's that's hard for people you bring in to do, because they kind of don't want to rock the boat too much.
00:09:41:16 - 00:10:03:22
Unknown
Like it is easier in many ways to preserve the status quo, which probably is going like pretty well. It's dangerous to say, hey, I'm going to gamble pretty well in favor of like, great outcome. It, you know, it takes a certain amount of conviction and credibility to pull that off. And I agree that it is rare that the kind of external CEO sort of has that.
00:10:04:05 - 00:10:33:03
Unknown
Yeah. Yeah. And there's so many horror stories. Right. It's interesting, you know, Apple's Tim Cook was in the news, I think, on Twitter this week where he put you, like the list of iPad air. Did you see this? Everyone's criticizing him for the iPad air. Because it's like, it looks really like, not innovative. It looks the basically calling Apple, like Rescue Me at this point and, you know, and, you know, you kind of, you know, Tim Cook was a good CEO for a while, but like, you know, Apple's kind of running out of rope.
00:10:33:05 - 00:10:42:20
Unknown
It feels like, you know, on on, you know, they're next generation stuff. So, it's interesting to see how all these different companies do it.
00:10:42:20 - 00:10:58:07
Unknown
new people. Like, I think pride. People say similarly about Andy Jassy. Like the super steady hands on the reins at Amazon. Like one foot in front of the other. It's going super well, you know. Is that where that like next breaks your pipeline is going to come from?
00:10:58:09 - 00:11:13:22
Unknown
Yeah. I'm clear. I think Tim Cook has done an amazing job generating shareholder value. I agree with you that we haven't seen anything sort of eye Poppingly novel from Apple in a while. I mean, Vision Pro maybe, but I think the market has maybe was a little too early on that one.
00:11:13:22 - 00:11:30:20
Unknown
I mean, I mean, Vision Pro is a perfect example of where I was just talking about, which is like not knowing how to take on risk. Right. Like not knowing how to like, take on a new product and like, you know, Envision Pro case. They went way too far, right? And like, taking on too many features too, you know, too much.
00:11:31:00 - 00:11:49:15
Unknown
You know, the problem is they're trying to apply a template. Maybe like, oh, yeah, the iPhone was like this, and we did this with the iPhone, and now let's do this with the Vision Pro. But it's not the same product. It's a very different type of product. And I mean it's a perfect example of not knowing how to, you know, take on risk and take on like, you know, really innovating on the product side.
00:11:49:17 - 00:12:11:09
Unknown
So I mean, we'll see. I'm not very bullish on Apple at this point. I would say like they need to make some big changes long term. But the iPhone monopoly is you know, they're really so profitable, the best business ever and the best product ever created or the most profitable product ever created. It's, that they can maybe go on for another decade, just like skating off the right.
00:12:11:15 - 00:12:21:17
Unknown
I have a bunch of questions for you on, like, you know, your LinkedIn post because you have a lot of very interesting LinkedIn posts. When did you start doing that? This was kind of some reason why you started posting some really like.
00:12:21:17 - 00:12:34:07
Unknown
it's interesting. There was a time, I think, like, a couple years ago, where I had a pretty good cadence, and I had a Substack that I really published weekly, and I was really, like, on top of that. And then I kind of just. I fell off a cliff a little bit. I sort of neglected it.
00:12:34:07 - 00:12:37:09
Unknown
And then a couple of months ago, I was like, okay, I need to get serious about this again.
00:12:37:13 - 00:12:38:21
Unknown
Yeah.
00:12:38:21 - 00:12:48:23
Unknown
with the transition out of the Sierra, which is like, okay, actually, I do have a little bit more time for things I think are important, but are maybe previously like sounds a little bit discretionary.
00:12:48:23 - 00:13:06:09
Unknown
You know, one thing that, one of the biggest things I learned, is something you post to which I haven't seen anyone else post is about like, not wanting to be well liked. It's it's such a difficult thing for a human being to not want to be well liked, especially as a leader of, like, a group.
00:13:06:10 - 00:13:15:03
Unknown
We talk more about that. Like what? What did you learn about, like, you know, optimizing for your popularity as, like, a leader versus other things.
00:13:15:07 - 00:13:30:23
Unknown
Yeah. You know, it's interesting because in the early days of the company, you're building it with your friends. And so probably you who are, like, well liked and high trust by default because, like, you knew these people, you were all in school together or you'd worked together in a previous company, or you have some tie that kind of binds you.
00:13:30:23 - 00:14:01:23
Unknown
And so you get a lot of sort of like trust and credibility for free. And then as the company grows that, that as the default state tends to erode a little bit, it's not the case that employee 250 or employee 300 necessarily like likes or trusts or thinks that you're doing a good job. And furthermore, I think what's interesting is like there are some cases where it is so clear what the right thing is for the company, but it's not going to be popular.
00:14:02:01 - 00:14:14:09
Unknown
And you know that. And I think there's a temptation among the inexperienced founder to say, well, I don't want to do it because like, people are going to be mad at me or, you know, I don't know, they'll complain or whatever. And that is just a recipe for the company dying.
00:14:15:21 - 00:14:19:05
Unknown
unfortunately, or maybe fortunately, I don't know.
00:14:19:07 - 00:14:39:11
Unknown
I think startups are successful when they push forward on an opinionated viewpoint and just go firmly in one direction. And if you are instead sort of governed by consensus, you're going to get consensus results, you're going to get sort of mediocre results. And a desire to be well liked is ultimately a desire to stick to the consensus. Right?
00:14:39:11 - 00:14:55:18
Unknown
It's like if you're doing the most popular thing, you're basically saying, okay, well, let's let's have everyone vote and let's do that. And that will prevent you structurally from making any hard decisions. And so I think, like if that's what you're optimizing for, you're not governing the company. Well, it's like it's actually not responsible. It's not responsible for the company.
00:14:55:18 - 00:15:26:02
Unknown
It's not responsible for the shareholders. Like you owe your employees, like having some backbone and being willing to make hard and unpopular decisions. And I think if you can't do that, like it seems pretty unlikely that it's going to work, because inevitably there will be hard times when things are going great. You don't need to make any hard decisions, but where maybe like growth is slowing or whatever, it's like, actually you have to make the call, and the call is necessarily going to be unpopular because some percentage of folks will not agree with you.
00:15:26:04 - 00:15:43:12
Unknown
And that compounds as the company size grows, if there are 300 people and 1% of them, which is a super low percent of 1% disagree with you, that's still three people, right? I mean, Definitionally, at any time someone is unhappy about something you're doing, and so you just have to kind of embrace that. It's you have to accept that's fine.
00:15:43:14 - 00:15:47:21
Unknown
That is part of the job. And like you cannot get too worked up over it.
00:15:48:05 - 00:16:08:09
Unknown
Yeah. And I think that's a great point. And, it's not obvious for a lot of of new founders and new CEOs. You know, I think one thing that I learned, though, it was a nuance, is like the way you implement these unpopular decisions actually matters a lot. So, like, there is a really a real skill in execution of like, unpopular decisions.
00:16:08:11 - 00:16:29:21
Unknown
There's a way to get over people's concerns in a way that doesn't make them like, overly vocal, you know, like or overly like, disappointed or, you know, disheartened. I think what what, people, what founders often think about is like, oh, this person is so important, and they're not happy with this decision. What if they leave, right?
00:16:29:21 - 00:16:46:06
Unknown
What if they just like, oh, you know, they leave. They draw a competitor or they they leave and they take some people with them, you know, like, and I think so the people who actually have the pushback actually matter, right? It's not, you know, if they're high performing people, that's actually much harder to make an unpopular decision.
00:16:46:08 - 00:17:07:12
Unknown
But it's still the right case. Right. And so what I found really helps is like, is explaining the decision in great detail, like, like explaining the rationale in like, great detail. And what doesn't go well is that if you say this is the decision, you know, the CEO, let's get with it. You go with the program, disagree and commit blah, blah, blah like that.
00:17:07:12 - 00:17:25:19
Unknown
That doesn't go well. What goes really well is like like having a deck to like explain your decision or having a memo to discipline your decision and going over it. And and even when people disagree, you can say, yep. You know, here's exactly my rationale. Here's where you believe that's different from what I believe. And, but, you know, this is what I believe and this is what we're going to do.
00:17:26:01 - 00:17:42:21
Unknown
And, you know, just being very granular about it. And, I found that to go really well, and I found that there are instances where I didn't do that, and then people did actually quit. And like, it got worse. That made the situation much worse. So, yeah, that would be my my nuance on that.
00:17:42:21 - 00:17:57:18
Unknown
think that this. I have another post about this where it's like. You have to not neglect the comms. Like you have the full state of the company, probably in your head. You know what's going on at all these various people and all these various places. Other people don't. And so you do have to bring them along for the ride.
00:17:57:20 - 00:18:18:00
Unknown
Now, that's distinct from saying, I'm opening this up for debate. Like you are telling, you're not asking, but you're saying, hey, listen, we're doing XYZ. I know some of you may not be excited about it. Here is why. Like it's signaling this is this was carefully considered. This is why we're doing it. This is why we think it's the best option.
00:18:18:02 - 00:18:33:13
Unknown
And yes, I understand that it kind of sucks. And like I also feel bad that it sucks, but it's like the right thing for the company. I agree that, like, you got to bring people along for the ride if it feels like you just arbitrarily one day decided to wake up and do a thing that makes no sense to them.
00:18:33:13 - 00:18:53:07
Unknown
Like that's extremely demoralizing because it's just like it's super opaque. It's like it undermines their trust in what you're doing. Whereas if you say, hey, this is what we're doing, I know it's not gonna be popular. This is why I think it's necessary. You know, you're giving folks an insight into how you're thinking about it. You're letting them know that it was not a casual thing.
00:18:53:07 - 00:18:57:09
Unknown
It was well considered. It was the option of last resort or whatever it is.
00:18:57:12 - 00:19:21:08
Unknown
Yeah. And I think the, you know, the even higher difficulty move is is to actually open it up for debate. Like that's the like and which is in some cases a, a you know, something that, it's the right thing to do in some cases because you have a lot of smart people in your company, and you actually do want to get their opinion, you know, before, you know, you make a decision, right?
00:19:21:10 - 00:19:41:09
Unknown
And if it's a big decision, like, you know, sometimes, like, you know, different people's opinion, different people's data actually may matter. But the problem is when you do that, is like back before a decision, you don't make a decision, then open it for debate. Right? That's like but like before you make a decision, you might want to have like a debate and and solicit everyone's opinion.
00:19:41:11 - 00:20:01:18
Unknown
The problem is sometimes it gets very political and like, you know, you you develop camps and like, the camps are trying to influence you in different ways. Right. And like, it can get very nasty. And if it's a big decision, like, you know, there's, and one of my think my goals have always been to like, minimize politics or whatever I do and like, and minimize the incentives for politics.
00:20:01:19 - 00:20:14:21
Unknown
But, you know, in, in like, debates like that, you can actually get it. But sometimes it's the right thing because you want to get all those competing opinions, like before you actually make that big decision. It's hard to do. I would say it's hard to pull off in a way that everyone feels good about it afterwards.
00:20:15:05 - 00:20:31:08
Unknown
Yes. I mean, I think there's a your point is exactly right. Which is the time for that is before the decision is made. After the decision is made. Like. And no, it cannot be the case that anyone can go and veto or relitigate a thing that your company is doing. It just doesn't work that way. And I think you're right.
00:20:31:08 - 00:20:56:09
Unknown
There's a thoughtful balance of you want to read your key people in because they may know things you don't. At the same time, you want to avoid the kind of like in-group, outgroup dynamic and obviously the more like it depending on the decision and how confidential the decision needs to be, the like wider the circle of consultation the like, the greater the probability that folks hear about it via the rumor mill, which is even worse than like clear comes from you.
00:20:56:16 - 00:21:22:20
Unknown
Yeah, absolutely. And you know, I think the other point you're making with your, your LinkedIn post, about being well liked is I focus on winning, you know, and like, I think that's a really important point. Like if you look at, like, see your popularity on our glass doors, the fact that it's often very correlated to like, you know, how well the company's doing, if the company's not doing well, like you might be the, you know, the funniest, you know, most likable person in the world.
00:21:22:22 - 00:21:42:12
Unknown
You know, people are not going to be happy. But if you if a company's doing well, even if you're a jerk, like, you know, you could see this with Elon today to some degree, right? Like, you know, people like you and stick with the company, you know, and, it's kind of I actually think the best ground is like, okay, your company is winning, but, you know, it's you also care about your people.
00:21:42:16 - 00:21:47:21
Unknown
I think that's the best scenario. But, if you have to pick one, you just pick winning. Right?
00:21:48:00 - 00:21:55:21
Unknown
Well, it solves a lot of other problems. Maybe we could say it masks a lot of other problems, but also it solves a lot of other problems.
00:21:56:14 - 00:22:14:16
Unknown
What do you think of, like, Elon style? I'm curious. I you know, I've never talked about this. You seem like a very empathetic type of guy. Like, you know, you know, I feel like I feel a lot of founders are going to, like, copy someone like Elon and, like, you know, dudes, you know, going with a chainsaw on, you know, and make decisions like, seemingly capriciously in many cases.
00:22:14:21 - 00:22:34:21
Unknown
You know, it's tough because I think it's hard to argue with the results. I mean, if you look at Tesla or SpaceX or, you know, whatever, it's like, these are iconic generational companies and it it's hard to say that those were easy to do. Is it the I don't know, it's the only way. I mean obviously like Steve Jobs was in this mold as well.
00:22:34:22 - 00:22:44:08
Unknown
Delegates to some extent in the early days. I don't think it's the only path. I think it there is a certain amount of
00:22:44:08 - 00:23:00:23
Unknown
I don't think it succeeds because you are a jerk. In some ways, it succeeds in spite of your being a jerk. You have to have the talent to kind of back it up. I think the challenge is like, you're not Steve Jobs, are not Elon Musk, and you try to copy that playbook and like, no, now you're just a jerk.
00:23:00:23 - 00:23:30:02
Unknown
Like, that's not going to work for you. I think what is true is that, like, all of these folks are have essentially started what are effectively cults like. And I say that it actually is like kind of a good thing, which is like the team are deep believers in the mission and the task at hand. And they are gonna go, you know, above and beyond to make it happen.
00:23:30:04 - 00:23:57:20
Unknown
And I think that kind of fanatical devotion, again, it's not a sufficient condition for success, but it doesn't hurt. Like I think if channeled the right way, that can be very effective. Like I don't think I guess like let's let's look at the converse or whatever. I, I think if you have a team that does not care deeply, it is unlikely that you're going to get great results.
00:23:57:22 - 00:24:18:10
Unknown
Now is the way they get the team to care deeply. Does that require, like having them sleep in the office and like yelling at them or whatever? Like, no, I don't think it necessarily does. But if you can't get that like deep level of care and ownership and passion, like it's not going to work. Like, look, Tim Cook is kind of the opposite of these guys.
00:24:18:10 - 00:24:41:01
Unknown
But there's like a great anecdote in one of these, you know, I don't some book where, like, Tim Cook is in a meeting with his executive team and they're talking about some problem with iPhone production or whatever, and he's like, yeah, someone, is going to have to go to China and like check on what's happening here, like to some executive and then like 30 minutes later, like there's still the meeting and Tim Cook turns to this guy, he's like, why are you still here?
00:24:41:03 - 00:24:57:22
Unknown
Like, yeah, I meant like right now. And like, the guy like, goes and gets in his car, like drives to SFO and like, buys the ticket and like, goes to China. It's like, I do think that if you want to make great things, you have to care deeply. And now, candidly, it does not necessarily require an 80 hour week.
00:24:58:04 - 00:25:05:07
Unknown
I think in some cases it doesn't hurt. But it's like that. It's a subtle distinction. And that's probably how I would walk the line on it.
00:25:05:07 - 00:25:24:10
Unknown
Yeah. I think, you need to know how to drive your team in a way that that gets maximum output but doesn't burn them out. Right. You don't want to burn out your team and you can I mean like we've all seen it at some point. Like you can burn people out. People have lives outside, work. You have to be,
00:25:24:12 - 00:25:44:20
Unknown
Yeah. So I do think you have to be a human being as a CEO or a leader, like, you know, you know, you have to. I think you'll get better results if the team knows you also care about them. But I agree that it may not be, necessary, you know, for success. Like, you know, it might be just maniacal about the output.
00:25:44:22 - 00:25:52:08
Unknown
I do think at some point, like, if you've gone through hell and you've come out the other side with the success, the team bond and like the cult nature
00:25:53:11 - 00:26:12:12
Unknown
Unbreakable. Yes. Yes. I mean, look at the key people at these Elon Musk companies, like. Or, you know, an Amazon. It's like, I think there's like a I think it's fine for your company to be a filter where it's like some people are all about it and some people don't click. I think that's okay. It doesn't have to appeal to everyone.
00:26:12:14 - 00:26:33:12
Unknown
Clearly, something is working in some of these places because the loyalists are super loyal and like, I think you know it. It's kind of like the engineer in a way. It's like actually a small number of people who are super passionate and super committed will drive more outcome for you than a large collection of folks who are just, like kind of phoning it in.
00:26:33:14 - 00:26:46:07
Unknown
And so maybe the maybe the tail on this is like figure out how to get a small a really passionate team that is like dedicated to making the same great. And I think there are a number of paths to doing that.
00:26:46:07 - 00:27:07:03
Unknown
Yeah. Yeah. I've seen this actually happen. You know, at Presto, my last company, where we went through a few near-death moments, you know, together. And a lot of people left. But the group that stayed, you know, through that are still very tight even today. Right? So, like, you know, those types of, you know, going through these crucible moments with a group of folks who, like, really care.
00:27:07:05 - 00:27:27:15
Unknown
It's like a life changing thing for a lot of people, you know, in those moments. And, and, you know, Tesla has gone through a lot of pain. Amazon has been through a lot of pain. And, SpaceX, you know, these are all companies that have been through multiple near-death moments. And Elon has been at the front end of like, you know, Tesla and SpaceX, like like taking the arrow straight on.
00:27:27:15 - 00:27:31:19
Unknown
Right? So, like, I think that gives you a lot of credibility with his team.
00:27:32:07 - 00:27:38:09
Unknown
I do think there's a certain amount of lead from the front that is very key. It's like I wouldn't ask you to do anything. I wouldn't personally do.
00:27:38:09 - 00:27:49:12
Unknown
And look, all I think you can. I mean, I don't think this is a hot take. I think you can respect Elon as an entrepreneur while not necessarily agreeing with his political views.
00:27:49:14 - 00:28:12:16
Unknown
You know, I wish I like held both in the same esteem. I have a nod to, but I think those are separable things in a way. And I think some of the discourse here gets lost, which is like, I think people say people struggle to say, well, I think, you know, Tesla is a generational company, while also saying, I don't agree with what Elon is currently doing on X, Y, Z.
00:28:12:18 - 00:28:18:04
Unknown
And I actually think it is possible to say both of those things. But, you know, the discourse does not really permit that.
00:28:18:04 - 00:28:36:17
Unknown
Well, yeah. I mean, now we're seeing things like, you people, you know, like, like Tesla has become like a political target now in some ways. I saw an article New York Times just a couple of days ago. You know, people driving Teslas are being, like, heckled or, you know, like, I think someone put fire to a, like, a Tesla Supercharger station.
00:28:36:19 - 00:29:05:04
Unknown
Yeah. So it's it's getting pretty nasty, but it's a great car. You know. Yeah. But the but I would say some of the political takes are very hard to, to read as well. So, I, I understand some of the you know, some of the concern on that end as well. You know, one thing you mentioned, I think this is a good jumping off point to this other, thing that you've brought up, which I think is, again, someone something that very few people talk about is like, you know, startups die when they lose the will to live and not when they run out of money.
00:29:05:06 - 00:29:25:19
Unknown
And you're the reason why this is like somewhat of a contrarian point is, like most, I think most people, even VCs and other people, they're all, you know, everyone's really focused on the money side, which everyone should be, be very conservative. But like once as a founder, you've been through like a near-death situation. You kind of know that really the will to leave is the only thing that matters.
00:29:25:20 - 00:29:35:04
Unknown
And it actually gives you a lot of confidence in all sorts of situations. So maybe talk more about this. What did you, you know, think through? How do you kind of come up with this concept?
00:29:35:04 - 00:29:59:13
Unknown
Yeah. I mean, look, the money is again. It's all. This is the theme of our conversation here is kind of about necessary versus sufficient conditions. Like the money is necessary or. But business cannot exist in the absence of money you, like, can't employ people. You can't, you know, do things. But it is also not enough. Like you have to have people who are of the first of all, the founders have to be passionate.
00:29:59:14 - 00:30:27:16
Unknown
They have to believe that it will work. And if those things are not present, it doesn't matter how well funded you are, you're not. The company is not going to succeed. Like if the founding team and if the team in general, like doesn't believe it can win your best people won't stay. The people that are there aren't going to do that where it's just like you end up either on a path to mediocrity or you just give up and like shutting down.
00:30:27:19 - 00:30:44:20
Unknown
Yeah. I think that's a really important point. I mean, one thing I would say have been having been through cases where we're almost run out of money several times, I would say my last company close to ten times I can like an obscene amount of times, you know, like most companies go through like 1 or 2, a near-death moment.
00:30:44:20 - 00:31:06:16
Unknown
I've been through, like, a lot more. But but the will to live was always very strong. And I think, you know, I was expecting this. Other folks. Recently, it's like when you're evaluating founders, that's really the main thing that distinguishes a founder from other people. Like, you can have smarter people in your company. You know, you can have, you know, more talented engineers, more better designers and stuff.
00:31:06:16 - 00:31:20:18
Unknown
But the founders are typically the people with the most motivation, and not just because of like, equity stake, but also because they really care about the problem, their solving. And, and they're willing to just drive through what's right, they know, to, to get there.
00:31:20:22 - 00:31:44:20
Unknown
I mean, I think dispositional to some people are, like, more tenacious and resist resilient than others. And, like, that's not necessarily bad or good or whatever, but I think it is a key element in startup success. And actually, the reason I got to this is a little funny is like from this kind of like prepper survival books, basically where they say, like in the preface, one of these books, they're like, listen, yes, of course you need time to make a fire and set traps and all this.
00:31:44:20 - 00:32:03:10
Unknown
And like you, the knowledge matters and like your kit, like your supplies matter. But actually you just sort of have to believe that you are going to make it work. There's a thing called the Stockdale paradox, and I'm going to mess it up. But it's just like this was some interview with Stockdale who is, you know, this is like a Vietnam War.
00:32:03:12 - 00:32:24:01
Unknown
And he's a he simultaneously need to soberly like, confront and understand how perilous entire your situation is. But you also have to believe that, like, you are going to get through it and you have to have both of those elements, like just naively believing that it will it will change tomorrow. You'll get disheartened. You give up dwelling on like, we're so screwed.
00:32:24:01 - 00:32:26:09
Unknown
Like, you also get disheartened to give up it just like it's
00:32:26:09 - 00:32:38:20
Unknown
you have to sort of have both conflicting thoughts in your head at any given time. And I think that's that's very key to the alternate experience. You have to believe you can do it, but you have to soberly confront all of the ways in which it might not work.
00:32:39:06 - 00:32:58:08
Unknown
That's brilliant. Yeah. It's interesting that w, actually, you know, had the same mindset then, that, startup founder, you know, it's like. Yeah, it's, but that's exactly right. You have to be rational about where you are, but but also believe that you could figure it out. And, that takes almost some level of insanity, but it's,
00:32:58:08 - 00:33:25:08
Unknown
definitely. Definitely. There's definitely there's there's a certain amount of, like, self-delusion required because you are doing something that, by all odds, is not going to be successful. Like the odds are not in your favor. It almost certainly will not work like you will almost certainly not make it to that next milestone. Like if you look at the filter and it's like from companies that are started all the way to companies that IPO or whatever, like the percentage that advanced each level is like not large.
00:33:26:20 - 00:33:30:20
Unknown
those odds and say, but I think we're the ones that are going to do it. Like, you have to be a little crazy.
00:33:31:03 - 00:33:55:03
Unknown
Yeah, yeah. So. And, you know, your tolerance for pain has to be pretty high. And, like, you know, it's almost like you're running a marathon elicits a marathon, not a spread, but you're running at a pretty fast pace, and it's like, you know, it's pretty tiring and, paid for along the way. So it does take, you know, it takes a lot of grit and, it's but but, you know, one thing I found about my own personal journey is that I've, I've come to enjoy it.
00:33:55:07 - 00:34:11:21
Unknown
I've come to enjoy the, you know, all these parts, you know, that maybe early on, like, you're on the steep part of the learning curve, it feels quite painful. Like going through all the challenges of not knowing what to do, but like, as you know, kind of know what you're doing. Even though you're learning new things, you're starting to enjoy that paint a little bit more.
00:34:12:01 - 00:34:13:20
Unknown
I don't know about you. Yeah, maybe
00:34:13:20 - 00:34:32:02
Unknown
think the second time. Founder experience. The third time. Founder experience. Like you just know that it can be done. And, you know, people talk a lot about the four minute mile, but I like I like the four minute mile story, which is like, you know, Roger Bannister, whoever ran the four minute mile, people thought it was impossible when it was demonstrated that it was possible.
00:34:32:02 - 00:34:33:08
Unknown
Lots of other people could do it
00:34:33:14 - 00:34:34:20
Unknown
Yeah.
00:34:34:20 - 00:34:43:20
Unknown
thereafter, because suddenly they believed it could be done. And I think it's a second time factor. You're like, well, I actually have done this before, so I know that it is possible, so I will do it.
00:34:44:02 - 00:34:49:04
Unknown
Yeah. Yeah. It's amazing. Amazing how much that mindset changes outcomes.
00:34:50:01 - 00:35:10:04
Unknown
So you talk about, like, you know, talking smack about your competitors or not talking smack about your competitors. And I think this is a really interesting matrix that you've come up with. David and Goliath. And, you also talk about leaning in to being a small company. I love this. Maybe explain how you think about, like, a leaning into being a small company and B, you know, talking about competitors.
00:35:10:21 - 00:35:29:10
Unknown
Sure. So on the David Goliath thing, this is actually an idea from Guy Kawasaki in one of his books where he says, basically, like, people like to root for the underdogs, like, position yourself as an underdog. And if you're not the underdog, talking about your competitors actually hurts you because you're giving them free airtime, you're giving them free publicity.
00:35:29:10 - 00:35:51:06
Unknown
This is like supposedly, and this is kind of a dumb thing. It's like supposedly politicians will never say the name of their opponents. I'll just say like my opponent or the other guy, it's because they don't want to give them free airtime. And I think there's some truth to that, which is if you're out there saying, oh, you know, don't use X, y, z, use pilot, what you're basically saying is, hey, if you haven't cross shot against X, y, Z, maybe you should.
00:35:51:06 - 00:36:08:05
Unknown
Pilot is like worried enough about them that they mention them by name. And so like if they're your size or smaller that's like not to your advantage. Now if you're like some tiny database company and you like talk smack about Oracle like, yeah, that's a fun story. People like that. It's like, you know it's not like this. People were unaware that Oracle existed.
00:36:08:05 - 00:36:25:21
Unknown
You're not you're not turning them on to a net. You know, a possible competitor that they weren't previously aware of. So that's I think about the kind of like David Goliath, like you want to be David, you want to find your Goliath, and you want to kind of pick a fight with them because either they do nothing, in which case it's a nice narrative, or they actually respond, in which case you're getting like a bunch of free airtime.
00:36:25:21 - 00:36:48:22
Unknown
Like if they actually punch back, like, wow, that's great. Like Oracle mentioned us, that's amazing. Like that's amazing. Free publicity. And then I'm leaning into being a startup is like, listen, as a startup you have very few structural advantages. Your only advantages are you can move fast and you're small. And so I recommend folks like don't try to hide that like the take advantage of it.
00:36:48:22 - 00:37:10:03
Unknown
So when you're talking to a prospect you know it's a big account. It would be your biggest account. They're competing. You're you're competing against the like industry standard person who probably they would by default use. I think it's very powerful to say, well listen, yeah they're the big guys. But this is a huge deal for us. And like I'm the founder and the CEO and this is my personal cell phone number.
00:37:10:03 - 00:37:24:17
Unknown
And I am going to make sure that we knock it out of the park for you. And the other guys just can't do that. And like, yeah, they're just too big to care about you. But I'm going to make sure you have an amazing experience. Like I'm going to make it super concierge for you. We're going to make sure it works super well.
00:37:24:17 - 00:37:43:04
Unknown
And I'm backing it up, like with my personal guarantee, like, call me if it, you know, if you ever have any trouble. Like, that's that's pretty compelling because, like, what are the customer want? The customer wants their problem to be solved. And so you they have to believe that you are more likely to solve their problem comprehensively or in a good way than the alternative.
00:37:43:04 - 00:37:54:16
Unknown
And then if the alternative is like a nameless, faceless organization where you can't get anyone on the phone like it is very powerful to say, well, listen, this is a huge deal for us. Our team is going to go above and beyond to make sure it works well for you.
00:37:55:03 - 00:38:08:11
Unknown
I think that's such a important point for founders. To realize. Is that their size is actually an advantage. Like, I want founders to be thinking about them being smaller is, like an advantage. And not just like a not a disadvantage.
00:38:08:16 - 00:38:26:11
Unknown
Yes. And it is if if deployed correctly, it is an advantage because if you try to act like a big company, you're just a big company with less funding and less of a brand. Like if you run their playbook, you definitionally run it worse. So you have to run a playbook that they cannot run.
00:38:26:11 - 00:38:46:17
Unknown
Yeah. Exactly. I, you know, my, my last company competed with Google and like Apple and Microsoft and much bigger competitors. And I came up with so many good like you know lines for like you know why were better like I remember one, one meeting like someone told me like, oh, this competitor said, they're making more of this product.
00:38:46:17 - 00:39:02:20
Unknown
They have a lot more deployed. And I'm like, yeah, McDonald's also makes a lot of burgers. Are they the best burger? You know? And like, you know, that one line actually like we've totally reversed the deal. We won the deal. But like because it was you know, we were also talking to a restaurant, so but it was, you know.
00:39:02:22 - 00:39:12:11
Unknown
Yeah, it was a it resonated. But I remember that like like, you know, this kind of like, debate that people have over bigger versus smaller, right. And,
00:39:12:11 - 00:39:20:02
Unknown
and I feel like right now, like the one of the reasons why I'm in the 0 to 1 phase again, is because I feel like zero one is a big advantage, actually.
00:39:20:02 - 00:39:37:12
Unknown
And when I'm trying to, if you want to build something, you know, that's disruptive and something that really changes the way, you know, people live, then you want to actually have a smaller company because you can be way more nimble, way more agile. You can take risks that the bigger companies can't. And you and I have now seen like, what kind of bigger companies look like.
00:39:37:12 - 00:39:54:21
Unknown
Right. Like they're very slow and they're very bureaucratic. And, you know, they're very political. They have a lot of lawyers. They have a lot of people telling them what not to do. And it's tough actually. I, I respect the people, you know, people like drew who try to, you know, run Dropbox and be innovative. Right? It's hard.
00:39:54:21 - 00:40:02:17
Unknown
It's a hard job. It's really it's much harder, in fact, than to do that job than to run a small company and like, innovate. Yeah.
00:40:02:17 - 00:40:16:23
Unknown
dis economies of scale. Like there are economies of scale. There are advantages to being large, but there are very real material dis economies of scale. And there have to be like first principles thinking here. If there weren't, there would never be startups like it would not
00:40:16:23 - 00:40:18:11
Unknown
be possible for a startup to exist if
00:40:18:11 - 00:40:22:23
Unknown
startups had no advantages over big companies, big companies would just totally dominate the landscape.
00:40:23:05 - 00:40:40:00
Unknown
Yeah, yeah. And one thing I also wish founders would know is like how much revenue starts to like control a company at a certain stage, you know, like you know, once you have a stream of revenue, like kind of dominates you like the whole like, like soul of the company goes into, like, protecting that
00:40:40:04 - 00:40:43:11
Unknown
Right. Sustaining it. Slight, incrementally growing it?
00:40:43:11 - 00:41:04:00
Unknown
yeah, yeah. And just natural. It's like I've seen that was just so natural for people to like, you know, build all their systems around that. And and so it gets very hard to like, develop new forms of revenue. And it gets very hard to also kill that source of revenue, you know, like, because they're like, hey, this is not going to be a long term thing or it's not a big enough market.
00:41:04:02 - 00:41:21:15
Unknown
So these are, you know, once you've been through it before, you know, you could see like the, the, the real disadvantage is not to say they have no way that people are, you know, buyers are still risk averse. They still like brand names. They still like well-funded companies. So, you know, there is a lot there. There are real advantages there.
00:41:21:15 - 00:41:24:23
Unknown
But a skilled founder can definitely overcome those.
00:41:24:23 - 00:41:26:11
Unknown
Yes, I strongly agree.
00:41:26:11 - 00:41:46:22
Unknown
so one question. Just, you know, whatever. You're almost 20 years and 18 years into the journey, right? What are your ambitions still like? You know, obviously you're you're you're part of pilot still, you know, you're still leading from the front there. But like, what's left unfulfilled for you? I'm curious, just as a fellow founder.
00:41:47:00 - 00:42:06:17
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