HubSpot

“So to bring it home in a more concrete way at HubSpot, 70% of our traffic and our leads came from posts that were older than 30 days old.”

“So HubSpot in Boston was famous for not having any titles for the longest time. They're titles externally, because clients care or your executive vice president or whatever, but internally, actually, they refuse to have a structure of titles.”

“If you're not familiar with what HubSpot was back in 2010, it was basically a media site with a little bit of a product.”

“We treated culture as a product. So we were constantly shipping new features. It had a budget. It had resources. There was even a senior leader to make sure that we got it right.”

“Danny is a partner at Sequoia Capital, and prior to entering the world of venture, Danny spent four years at Slack, As their head of enterprise sales at Slack, Danny built and scaled the self-serve, mid-market, and enterprise sales orgs across the Americas, as…”

“We have 5000 of them, but they're the ones that were the story consumers, and they're the ones that helped kind of spread the word to the other 140,000 people that are now customers.”

“HubSpot started in the marketing software business. And about, I'll say maybe seven years in we decided that, okay, well, we have marketing software, and we loved it. We loved the category. It was growing and that product now is over a billion dollars in ARR”

“Some portion of our portfolio has to be allocated towards things that can have a 10 X, hundred X or higher kind of return. Because otherwise we're net, we're going to be caught by the regression to the mean over time, right?”

“The first six hires, all men, all from the exact same school, same program, had the same, not necessarily the same graduating years, but just in that little cluster.”

“Along the same spectrum, there's a thing I call culture debt. And culture debt is when you hire either non-diverse teams or you hire people that are jerks that don't really fit and no one wants to be around. When you make those suboptimal or wrong decisions, y…”

“Decision number two is that we were 100% on a month to month program. So if you bought the product in month two, you figured out the products. Yes, it did suck just like the founders told me, but the value wasn't high enough. You could cancel. So every month, …”

“If I had to provide one piece of advice to startups, regardless of where, ah, in the kind of stage of evolution you are, the best time to work on culture is time t equals zero. Simultaneous thinking about the product, think about the people. I'm not suggesting…”

“You have to kind of polarize your market. A hundred percent of the people cannot agree with what you're saying because then you're basically in the middle, you've regressed the mean. Sorry do not pass go, do not collect 200 dollars, right? You're done.”

“And the year before the IPO is when we made this brilliant decision, like, oh, we're getting into CRM, right?”

“Intuit's the only real example back then of a successful software company that was 10 plus billion dollars in market cap.”

“One of the things that I think HubSpot got right is that we were kind of builders of community well before we even had a product, right?”

“When we went from two 50 to 500 we made a very simple decision very early that says, okay, everyone that had purchased the product at two 50, we were not going to raise the price on them. So all new customers will pay the new price, all existing customers cont…”

“On the top three list of things I've learned in, you know, 30 plus years now being in the professional world is that culture is a product. So we build a product. If you're a tech company, you build a product for your customers. We all understand that. We learn…”

“I'm pathologically non-confrontational, and that's why I'm a terrible manager, that's why I have no direct reports because I am just too, I'm too polite and too non-confrontational”

“I built at the kind of like media org within HubSpot. It's about 80 people now. We acquired the hustle, and so I kind of put all of that together”

“We really underestimated the change in team structure going from a traditional SaaS BDB company to like a PLG company”

“We did the hustle deal. We did not do the hustle deal based upon metrics, right? We did not pitch the board and say, oh, these are all the kind of cool metrics. It's a bet on how we want to be seen within the future, how we want to build our audience in the fu…”

“And so the brand marketing work that you do is the longest part of your timeline. That's going to be 12 to 18 months ahead of the reality of your business and your product. It's the emotional benefit. It's pointing everybody to where you're going. Okay. Then t…”

“I think we would have been much, much better off, for example, if I had a time machine, I would have said, no, no, no, our job is to like get the best steady run rate, and we should go and conquer a new channel with that same time, energy, and capital.”

“Most companies fail, not because of the product curve, but because of the distribution curve.”

“The biggest mistakes I have made is not hiring the right person or not knowing that I needed a person with a new level of skill set at that stage and scale of the company or holding on to somebody who was really good for that last stage of growth, but isn't go…”

“Data privacy is making track tracking attribution, ROI much harder every day.”

“I, my first job at HubSpot is I wrote the HubSpot blog. I wrote, I think we did like three posts a day for, you know, a year or whatever. And we did that to get organic search traffic. We're still doing that. We are. 14 years, 15 years into that blog grind and…”

“Every company in the world is either distribution constrained or product constraint.”

“Incentives and alignment around goals and incentives fix everything. If you have a problem collaborating, it is because you have competing goals or you have competing incentives against those goals.”

“The philosophy behind it was, okay, we are going to start with multiple bets. We are going to treat each one of these bets like a new venture investment. We are going to seed fund this. And so they like made us come and they would pitch for our seed funding fo…”

“Like HubSpot, we had a customer, but we had multiple users on that, like customers account and to understand how to move, grow the business and how to grow the product. It actually wasn't about a usage metric at the customer level. It was about a usage metric …”

“They have not missed a earnings since they went public, which was like eight years ago. I don't know if most people that they have never missed in earnings, the perfect record as far as I know.”

“We got to, I don't remember, it was like maybe like a 100,000 weekly active users or something, and then we looked at the user base, and there was a huge mismatch between the types of used, a lot of the types of users that were being, that were showing up in t…”

“Once you figure out kind of that core, that thing that's working, it's almost always in a venture scale company, the better thing to do Is to focus your firepower, your limited attention, your limited capital, your limited talent on fueling that thing as fast …”

“My biggest mistake at HubSpot was a little bit of what we touched on before, which is that I was in love with, like, the virality and other things that we had going with the early product, but there was a disconnect with the core target market of the core busi…”

“HubSpot have proved exactly that there's massive businesses to be built without ever having to go, like, all the way up market, right?”

“Box IPO did eight hundred million. HubSpot IPO did eight hundred million valuation. Shopify IPO did a seven hundred and fifty million dollar valuation.”

“And then the fact that now they're doing seven hundred million, their CRM product. There's CRM, which is the first real threat in some, to at least to the low end of Salesforce we've ever seen.”

“I don't think I'm necessarily well suited for the next phase from 7000 to 70,000 or whatever it is from twenty billion market cap to two hundred billion market cap.”

“What I found, and it's a little depressing is. You put somebody on a recovery plan, more often than not, they don't recover, and we end up parting ways to that person. Once they've lost their team, they almost never can get that team back.”

“The way Darmesh does the reviews, Darmesh is very introverted and does not want to talk to anyone. He really doesn't. So he does a Net Promoter survey on me, and so he sends a Net Promoter survey on a scale of one to 10, how likely are you to refer Brian as th…”

“We do net promoter surveys for the whole company. We've been doing this for. 15 years or once a quarter, we asked every, every employee scale one to 10. How likely are you to refer HubSpot as a place to work?”

“Everything you say, people pretend like they don't listen, and they push back at you, but they remember what you say. You'll run into somebody and, you know, you'd be walking down Newberry Street in Boston, bump into an employee, and you'll have coffee with th…”

“By the way, during the time he dug through all that, he figured out we were calculating unit economics wrong, and he got our head straight, our pricing model. He fixed a bunch of stuff during that.”

“We just bought a company And it was a couple months. It was fast. It was a two hundred million dollar-ish deal.”

“And one of the things I thought about on the bottom of that cliff was, I don't want to be the CEO of HubSpot anymore.”

“I think you're better off with the Mary, and you want kind of spike, a spiky team with some people who have great strengths and great weaknesses, and you want to spike in different directions. I don't, I think you want to avoid that lowest common denominator t…”

“And that mix really works, and I think that has worked for HubSpot. We've got a mix of people who kind of grew up through our system, and we hire people from the upside. That's proven to work pretty well, I think. I think that's a good formula.”

“It's gonna give you a little Cushion. And personal cushion, which is useful. And it's, it aligns your incentives with your venture capital investors.”

“I don't think I was at my best from two of us to 20 or 2000 to where we are today, but I think I was kind of at my best between 22,000.”

“Most scale-ups Aren't that good at hiring? And I think there's a fair amount of luck involved and have, they don't have a great hit rate. I think 50% within the first year and a half is close to. What most companies are in scale up mode.”

“I think it always breaks at a hundred people. At a hundred people, you go from knowing everyone in the organization, knowing a bit about their background, you interviewed everyone to, gosh, you just don't know some of the people. It goes from very flat, like t…”

“My thinking is, is, is the control freakish of founders is a amazing strength in startup mode. And that amazing strength of founders turns into an amazing weakness as you scale.”

“The most frequent The reason I let someone go, and the most common failure condition is I kind of think of this equation of are people solving for themselves, for their team, or for the enterprise? In the failure condition for people scaling up in their career…”

“We had very, very, very little interest. We had no, we've never had like an offer. We had very, very little interest in acquiring.”

“What you want is somebody who's three years up the ice cliff from you, who's struggled through that same path. What you don't want is someone who's 10 years Beyond it. Or even worse, somebody who's never really climbed that ice cliff.”

“Our retention rate was really, we were losing seven percent of our customers a month.”

“In this one particular trip, we had, like, whatever, 17 meetings with VCs and got 17 notes in a row.”

“HubSpot have built a twenty eight billion dollar company through SMBs alone.”

“Oh, start high and go down never, never works. In the history of software, you can tell me which company has succeeded in starting at enterprise and actually winning in SMB. It's not happened. But if you look at many companies, including Salesforce and Freshwo…”

“CRM is at seven hundred million, I think, and it's growing faster than marketing automation.”

“They will be soon be doing more marketing revenue than HubSpot.”

“A lot of folks do think that HubSpot is primarily a marketing company, which is no longer really the majority of the revenue.”

“Yamini got on the last call a couple of weeks ago and said, yeah, we saw a little bounce at the end of the year and HubSpot had a great quarter, but it's not any easier. She said, it's not one lick easier right now. So HubSpot, not any easier Mongo worse. Sale…”

“I think that the tough thing is we've learned that we've learned you've got to sequence these next acts. Like HubSpot did. And if you don't it's just, it's so hard to do it later. It's so, it's not impossible, but it is so hard.”

“And HubSpot is still growing almost 30%, right? At two and a half billion, but HubSpot's NRR is down too. It's down from a 110 to a hundred.”

“So for example, HubSpot back in the day, we led the series D in 2011. We would later find out that we were the only term sheet. Nobody else wanted to invest.”

“If you look at HubSpot, mediocre product in a crappy market. Not today. Not today. Not today. Circa of 2011.”

“Eight was the highest a hit in February of 2008. Throughout 2008, it was mostly between three and four, which is terrible. I mean, even at three or four, that's 40 to 50% a year churn. It's really bad.”

“At that point now we've acquired between Brian and I, we've probably acquired like 40 customers. We're probably at like a couple 100,000 in ARR”

“I mean, I think we're at two, three million in revenue at HubSpot and one rep brought Facebook to the table as a customer. It was like a three million dollar contract. It would have doubled our revenue. And he said, no, we were being pulled, said no.”

“Salesforce.com was an early investor in our Series D, believe it or not, and actually became a big channel partner for us over time, about 10% of our customers before we became competitive.”

“So I would say by year five, we were probably like. 50% inbound, 30% channel, 20% outbound.”

“Yeah, like even in HubSpot, we started at like 3000 a year.”

“It was, I think a hundred percent of our customers came inbound for the first two or three years.”

“I think we're going to look back on this discourse a few years from now, and it's going to feel very similar.”

“In fact, they are bigger in marketing revenue than HubSpot. They're actually bigger.”

“In 2012, our LTV to CAC was probably, you know, for every dollar we would put in, we would get two to three dollars back, but we got it closer to four, five, six over time.”

“If you are sort of like mid-market, like HubSpot, SweetSpot, which we would define as 25 to 500 employees, you need an ACV of somewhere between 10 to 12 K ACV to make it work from a return on rep investment.”

“So this playbook of sending an expat team, they open one office, they stay six to 12 months, They figure out that region, then they get shipped to another office so they can go and open that region in that office.”

“One of the things HubSpot did in the early days, and to some later stages too, is if you want to become a partner, you need to buy HubSpot. You need to learn the product. You need to learn how to generate leads using HubSpot. So it's almost like you're being t…”

“Where it did break is we underestimated that effort in Japan, because in Japan, only one percent of Japanese prospects were getting found by our English content.”

“HubSpot has about half off its revenue coming through the partner ecosystem.”

“We were going to open Dublin in 2012, but we shelved the idea because our retention metrics were not great. Our gross retention was, like, low seventies.”

“When we opened the office, we actually sent an expat team of five people from the Cambridge office, and we hired five people in Dublin. It was like this one-to-one match”

“Three million ARR when we opened Dublin.”

“One of the things we saw like when we went to Germany is our English content that we were creating. Half of our leads coming in from Germany, prospects in Germany, were reading our English content.”

“It was, you know, LTE to CACO, one is to four, one is to five, and over time, depending on the segment and geography, it became one is to seven, one is to eight.”

“So what we decided to do over time is, like, we're going to take a portfolio strategy, which is, like, There are 150 countries, but which are the countries we want to be number one or number two? Not number three, number one or number two. So we call them like…”

“Before we opened the office, I ended up hiring a bunch of young dads who would show up at four a.m. In Cambridge. Because they wanted to get home at two p.m. To be with their kids, and we were like, let's validate that demand. So we were selling early in the m…”

“The blog still gets about ten million visitors even today each month. All of HubSpot gets, like, I think, thirty million approximately each month.”

“There was some research done by HubSpot not too long ago where SMBs had a tech stack of about 250 apps.”

“We want to define a category of mid market software. And, you know, five years from now, 10 years from now, when you have guests in your podcast, I want you to ask them, hey, are you like Salesforce? Are you like HubSpot serving mid market? Or are you like Int…”

“The big shift that has happened, Harry, is search engines used to provide blue links that you can click and then reach someone's website. Now they're providing answers, which means you no longer need to click, and I think that's a shift that's going to continu…”

“Alignment eats strategy for lunch. And what I mean by that is the biggest job You know, job number one is setting up strategy, but I think what is even more important and critical in terms of a CEO is aligning all of the resources to accomplish that strategy.”

“And I've literally fed it with the last 16 quarters of earnings script.”

“I think, ah, companies with speed will win. It doesn't matter whether you're a startup or a scale-up or a grown-up like HubSpot, ah, anybody who operates with speed, who can innovate, will win, and at this point, HubSpot is operating like a startup. We, Have t…”

“We believe that in the fullness of time, we will have hybrid pricing. We'll have some seed based pricing and some usage based pricing.”

“We just actually made a change from unlimited vacation times to flexible time off.”

“We are going from a scale up to a grown up stage, and one of the things at HubSpot that I heard when I took on is that we don't like process. Process is a four letter bad word. We don't want to talk about process, and you need a certain amount of process as yo…”

“We have agents, you know, that customer agent that we have 1500 customers, and within weeks we saw 42 to 45% of tickets being deflected by AI.”

“There's a bit of a myth that the only way to grow, the only way to serve millions of customers, the only way to You know, become a very large, you know, company is by going up market.”

“We've been really looking at diversifying our content strategy for the last three to four years, even before AI came in. And that's a process of expanding to podcasts. We actually, you know, brought a podcast network and it's, you know, we get like millions of…”

“Deep conviction in SMB. Deep conviction in building a platform and crafting the platform Deep conviction in having culture as a product. Like, those are decisions that I just loved, and I completely believed in.”

“A product is kind of like neat and novel. They're going to use it for one day, and then they're probably going to check it out again once every two weeks, or maybe they're not going to, and then they churn out. So it's really the difference between neat and ne…”

“Internally, we've been using AI to resolve tickets, 35% in year one, and now we'll be on to 50%.”

“They actually appreciate your conviction in your business. That's what they like to hear. And so when we, you know, talk to them about why we make These decisions, why we focus on the segments that we do, they get our story.”

“I don't think like we look at it on single property basis. It's the, How is our overall awareness increasing across these multiple channels?”

“When I joined HubSpot, this is January, 2020 I looked at how we were running the company, how we were running marketing sales and service, and we were running HubSpot on HubSpot. And guess what? At that time, we were a 4500 person company.”

“When AI came on the scene in 20, 22, November, we fairly immediately moved into products, you know, product building, and we changed our roadmap. We actually stopped our roadmap, changed the roadmap, and started building product.”

“We have a deep conviction that there's one product, which is an AI product, and it's going to be inbuilt into every hub and every part of the platform. And that means Monetization is the entire platform”

“I have a sticky that is probably a decade old, and I can't take that sticky off my computer because it says, slow down and ask questions.”

“If we really had to make a choice, it would be product first. You know, the more you can invest in the product for it to be easy, intuitive, unified, crafted, The easier it is to get, you know, sales and marketing engine going.”

“When you spend the time providing the context to your team, when you ask more questions so that they can get to answers, when you enroll them in what you want to accomplish as a whole organization, Then you go far. And sometimes you optimize for speed and you …”

“Yeah, you have to have deep conviction in order to run a public company, and if those decisions and the choices that you make are counterintuitive, Even better, right? And it's almost like you got to forget that you're a public company and you got to start wit…”

“First of all, model costs and cost of inferences come down pretty significantly. You know, you look at it in 2023 to where we are now, it's come down significantly. I think cost curve is going to continue to, you know, decline. I wish we had a margin problem. …”

“What I got comfortable with is that no matter how hard I try, I'm not going to perfectly hit the approval of all of those stakeholders. At some point, I'm going to do something which, you know, is super beneficial to customers. At some point, I'm going to do s…”

“There is a myth that, you know, there's a completely different motion, and you gotta, like, go and hire all these enterprise class, you know, reps to come and sell, and in fact, if you do that, that will break the system, and that will break the culture. But i…”

“When the complexity of the buying process on behalf of the customer goes from I'm making decisions, I got the budget, to I have a committee of people that now need to make the decisions, that includes IT, that includes procurement, that includes security, that…”

“By the way that I ran interview at HubSpot and Adrift, everybody, I would help, I have a panel of people interviewing, But I would always interview myself. I will do the informal, I will do the formal, I bring them in, and then I do the closing. But I let them…”

“HubSpot two years ago didn't even have this essentials edition, which is like 45% of the new customers and more enterprise.”

“Literally I talked with Yamini wrong on from HubSpot last week. Okay. This is HubSpot. She said now at HubSpot there with cursor, they are pushing out so many features. They can't put them into production anymore. She wasn't kidding. They're there. It said the…”

“We are redeploying those teams to do other important work.”

“No, we haven't. Which is why I think I'm going to get in trouble for saying this. So we have a growth team that are very much focused on product led. They do really great work. We have an internal team that is trying to work across AI innovation across like hu…”

“We have an AI chat agent that is able to sell now. It's booked in meetings. It's doing sales.”

“We've seen a five X increase, but it's still less than one percent of our traffic.”

“And if you had told me 12 months ago that we could use AI to like five X the conversion rate on email, cause I'm like, ah, look, there's only so much personalization you can do in an email.”

“If you can't do something in six weeks, it's not worth doing. If you're in growth, right, you actually have to have minimal viable experiment. Figure out if you can do that thing and see a success, what I call an exit metric, but see a success metric after six…”

“I honestly think that maybe it's like three to five percent.”

“Because we were 27 X over subscribed. You know, I think it was 40 X over subscribed.”

“Yes, I remember that was in O-Nine. We did HubSpot, Box, DocuSign, and I think RingCentral.”

“People would say long only. They're not long only. They do sell. They come in and out of HubSpot. I see them coming in and out.”

“There's a big echo chamber in Silicon Valley and big negative bias towards SMB, but you can make it work in SMB. HubSpot and Shopify have shown it. Block has shown it.”

“The way Hellspot does it is on net new ARR. And an earning, like a floor earnings number.”

“Yeah, the smart money on HubSpot was in the public since we went from a billion dollars to 25. In a relatively short period of time.”

“I don't think there was collusion going on, but definitely Morgan Stanley and Fidelity were on the same side of the table trying to get us to sell at a lower price.”

“And I think Skoy is really smart. I suspect HubSpot was one of the reasons why they said, Let's hold these companies after they go public. It's back in some cases, but I think it's going to work over the long haul.”

“Zendesk at the time went out. And it was just, it was timing, and it was just a shaky week that they went out, and they just didn't get, they didn't get the big long onlys, and they had a good story, and they didn't get them, and they never really got them. Th…”

“If you go from that date and you look at you look at Oracle and you look at SAP, they're both growing, like, 230%. The only SaaS company since August 22 It's growing faster. Shopify. They're growing 300%. So they're outpacing HubSpot, Salesforce, Adobe Box, At…”

“It's very little of HubSpot is owned by mom and pop, owned by Harry Stebbings, buying Harry Stebbings's mom. It's like, 90% these big institutional investors.”

“We pressed 25. I think we opened at 33.”

“We wanted to go out at 25. Morgan Stanley said we should go out at 24. And the reason we should go out at 24 is Fidelity has told us That they're in at 24, they're out at 25. Ok, and you really want Fidelity, because Fidelity has trillions of dollars, and they…”

“When we did our round, it was Sequoia. Sequoia came to us and said, we'd like to buy some of your shares in retrospect. It's a horrible financial decision for me, but it was good at the time. And I saw, I forgot a couple million dollars worth of HubSpot shares…”

“It was in the throes of the recession back in and we went up and down Sand Hill road, like Darmesh and I get off the plane from Boston, landed in Sand Hill road. We're like, we got this. We're going to go up and down. It's like 20 meetings. And we go all 20 me…”

“HubSpot and Salesforce got to deliver in 20, 26 because they're in play. They have the AI things they built, they ship the products, but they haven't seen the bump that data dog and Twilio and Mongo have”

“There's like a 400 AI CRM startups out there all saying they're going to eat HubSpots and Salesforce lunch. That's not exciting to me as an investment.”

“HubSpot, 2.8 times more efficient than 20 21. Salesforce, two times.”

“You're looking at 12 and a half billion now market cap for them down 45% in the last six months.”

“The Mondays will churn faster than HubSpot, right? And HubSpot will churn faster than Salesforce. It's just delayed churn, right? That, that's the thing is, you know, ServiceNow takes you 10 years to get off that platform.”

“Google can buy them, but HubSpot, what's HubSpot's valuation as we record this? In the teens of billions? They just can't afford a billion dollar for every YC startup. They don't have the money.”

“I believe over the next 12 months, this strategy, if it's real, should lead to genuine re-acceleration at HubSpot. Otherwise, it's, there's no hope for this class, these classic categories”

“If the agent can run 24 seven autonomously, take all your data and build all the analytics, build all the dashboards, run autonomously out of it then your data can flow between apps and you won't even care where it lives and all the fears about headless become…”

“Every vendor that is seeing massive competition or slowing growth is going to be tempted more and more to cut corners on training, privacy, and HubSpot got caught.”

“The low-end CRM competitors are exploding. The revenue growth from Monaco, Lightfield, Auracel, and others, they're like nothing we've seen before.”