Snowflake

“When the world is rewarding, aggressive growth, don't care about profitability, you're going to have a mix of end results. You're going to have some of the snowflakes in Amazons, and you're going to end up with a lot of wrecks on the, you know, massive wrecks.”

“Stripe, which is cloud number one on our private cloud 100 list today with Snowflake's graduation, most likely.”

“The average multiple is trading north of twenty-x revenue, and you look at a snowflake that's trading at 80 times revenue. That's not sustainable.”

“When you look at companies like, you know, Snowflake, UiPath, CrowdStrike, these companies that are north of five hundred million in revenue growing still at incredibly hyper growth rates.”

“When you're, I mean, I often have this in hiring decisions, people have doubts. Well, you have your answer. Don't hire the person that you have doubts about. Don't. Ok? And it's a tiebreaker.”

“Everybody who is not in sales, because salespeople are on commissions plans, of course, but everybody who is not in sales gets a conversation, a money conversation and a performance conversation every single quarter.”

“It's easy to become valuation agnostic to a certain extent, because you've seen, if you hit a winner, if you hit a snowflake, if you hit a Uber or whatever, it ends up being a hundred X more than where you are today, so you become indifferent.”

“If we had looked at the founding team and the infrastructure they built, I think we would have looked past the individual customer feedback, a data point here, a data point there, that said, hey, this is still not quite ready for prime time, and instead focuse…”

“Most of that distribution, right, not all, but most of that distribution was Snowflake.”

“Our first fund VC won hell. I couldn't even raise it. I was 20 or 25% of the fund. And I put, we put over 30% of that fund in Snowflake at a point in time that the world thought we were crazy.”

“The truth of the matter is, I think Snowflake will be worth a lot more in the future than it is today, and even more in the future than it was then.”

“Going into that earnings report on a relative basis, we were the third most valuable software company in the world. From evaluation purposes, snowflake, cloud flare, us”

“The company was burning a ton of capital and couldn't raise money from the outside. And it was the insiders that stepped up and led that round because they believed in the business.”

“Sixty billion? I'm short.”

“Snowflake's now predicting 45% operating margins going forward.”

“And now there's plenty of examples that have been run where a smaller model fine tune where a specific purpose or a specific data set produces results better than a generic model.”

“He's also such a clear thinker. He has that commonality with Satya that he becomes a clarifying force. Oftentimes if you're just picturing yourself telling Frank about a problem and a couple of options, Just in the formulation, it becomes very obvious that you…”

“There are a lot of issues. Probably the most obvious one is around the Correctness and dependability of answers. If you ask folks, one of the key concerns is like, well, these models make up stuff. So that, that is the obvious one. But then there are second or…”

“In some instances where you want a product to come out with a consistent view, as if it came from a single unified set of principles and individuals, sometimes you have to go and push for something like, Hey, this is what we're doing.”

“It is something a little bit counterintuitive that you may put out a product faster to the market. If you just say, I don't know if we should be used this way or that way. So you just surface choices to users. And sometimes it takes longer for us to take the a…”

“If you turn something that is a subset of the capability, but dramatically easier to use, That gets a following, and that was a very, very clear lesson learned, and I've seen it over and over, and by the way, the Snowflake story follows a big part of that jour…”

“So the core subsystem that does say clustering of data on disk I think you want to design that thing really, really well. Measure a hundred times and cut once because nobody wants their data to get corrupted or their results to be wrong if that thing is not bu…”

“So at this point, I would say the incentive should be working maybe, I don't know, A year, a couple of years from now, what you're saying becomes true.”

“What you're seeing many of us, Snowflake for sure on the list, is evolve their platforms where it's easy to bring LLMs to the data as opposed to send Large data volumes to where the LLMs are.”

“I think Gen AI has the opportunity to Turbo charge this type of translation where the language is natural language, and the answers come in natural language, but along the way, there's traditional database lookups, traditional retrieval, and has the opportunit…”

“I don't know if they're going to be able to keep all the existing revenue, but for sure they should be able to capture some amount of revenue. So I don't know exactly what would be the replacement ratios. But clearly their data is valuable. Right now it's not …”

“I would bias towards incumbents that have the data. So I would say, think of all the data that a company like Google has. Or that's public data, or not semi-public, but a lot of user data, or think all the private enterprise data that a company like Snowflake …”

“I think it completely correlates with data maturity. You may have heard some of us at Snowflake talk about There's no AI or gen AI strategy without a data strategy. It's not just a line. It's a truth that we strongly believe in.”

“If you do not go on eight sales calls a week, if you do not become a student of what you sell, you will fail. You might be a really nice person, but if you don't do those two things, you're going to fail.”

“Founders love product marketers. They understand the product and they're going to build this marketing literature and stuff like that. That's a waste of time. The marketing team needs to generate pipeline.”

“There was some insinuation that Netflix was a customer. They were not. There was zero customers when I showed up.”

“So our professional services organization is a single digit profit margin business. It is not something wall street cares about in terms of our services revenue. It's an enablement function. It remains profitable, but at a low margin. So we're not losing money…”

“Mike Spicer didn't hire me to be the chief revenue officer of Snowflake. And in fact, I think he probably said to each of the board members, we'll probably fire Chris in a year or two. I was a director of sales.”

“When we hired our CMO almost seven years ago, Denise, I was arguing with the previous marketing team over what a, you know, an MQL was when an SQL was and all this other stuff. And it was driving me crazy. And she said, great news. We're never going to talk ab…”

“Mike Speiser was like, for two years, you're not selling a thing. Like, I don't want you to sell anything. I just want you to get customer feedback.”

“If you go out on a sales call, and the person doesn't know what the hell they're talking about, and they've been on the job for six months, yeah, you're going to be in a world of hurt, and you should just cut bait.”

“I was actually hired at the time. They didn't have a website. They didn't actually have a CEO at the time.”

“Early on, I actually wouldn't let the sales team put an opportunity in Salesforce to forecast it unless the customer had tried the product.”

“Yes. Get rid of them. Build a professional service organization. Hire more SEs who can do it. Customer success. Look, people think that's blasphemy. I get it. I don't believe in it. I inherited our customer success when Frank came in and he gave it to me. I go…”

“Amazon, they invented the cloud. They invented how to work with companies like us. We were hard for them because we competed with a product of theirs or multiple products of theirs, but yet they make us successful. So it's a hard thing to do, but for them to b…”

“So with Snowflake being a consumption model, you could see the dial turn real time. I look at revenue on a daily basis. And if a customer goes up really fast or down really fast, it sets off alarm bells because I don't want them to overspend because all of a s…”

“I mean, there's another opportunity where we co-invested in Snowflake before it IPO'd, and in that case, we were only able to get a few million bucks allocation, even though, given what we knew about the company, we would have invested a lot more if we had the…”

“I've never sold a share of Snowflake, and, you know, I'm optimistic that that'll turn out to be a good decision.”

“OpenAI is building a business for what it's worth. Like, I think they have, like, whatever, two billion in revenue annually, which is, like, higher than Snowflake or at least, like, as good as Snowflake. You know, so they're not as capital efficient as Snowfla…”

“We still own a bunch of Snowflake. We own a bunch of Amplitude. We actually own a bunch of Datadog.”

“It seemed like Snowflake was going to be the next great platform, but it is Databricks. I know it's not completely fungible product, but it's growing even faster at 2.5 billion, right? It's just mortal. Databricks, I think proves Snowflake was mortal.”

“A reps at Oracle right now. He's selling software, right? He's selling software. That's what he's going to say, and I'm going to say, okay, are you doing pipeline generation? Yeah. I'm selling our new X product into all these Oracle accounts that have never br…”

“Like, people would buy A 15 K land deal, and they'd expand to 150 in six months, right? So when you have product like that, that just expands on its own, you can get away with less customer success. I've not seen that since Snowflake.”

“Chris and I took a sales organization and grew it faster than any sales organization has ever grown in history. It's snowflake. There might've been others since it have grown faster, but at the time, nobody's done that.”

“They don't have a customer success organization at Snowflake, or at least they didn't. Maybe they've created one out, but they didn't. The feeling was everybody's in customer success.”

“Chris is the only guy that's ever gone from zero to three billion.”

“If you get managers saying different things and selling it differently as the reps are going through the process, what happens? You lose credibility. Hey, this manager said this. What the fuck? Now I just don't believe anything you guys are saying. So you gott…”

“In the very early days of Snowflake, we could only sell into ad tech accounts. That's it. They were just selling to ad tech.”

“This is the profile. I'm not deviating from it. Back to the conflict thing I said. So let's just say you hire, hire a new VP of the East, right? And he has his background or she, and he's got five people he wants to bring with him, which is a good thing becaus…”

“It's very clear that they're buying a bunch of business. That they don't have to worry about things like you know free cash flow. They have doubled the number of sales people that we have.”

“An inorganic kind of unrelated acquisition strategy is not something that I'm excited about. I think it'll be a disruption. Snowflake is a Product-led innovation company. We are not a PE shop. Not that there's anything wrong with being a PE shop. It's just a d…”

“Starting with AI. 100%. I think it's going to be a I think it's going to be a big deal. I think it offers the opportunity for disrupting BI as we know it today, more of a direct to consumer.”

“They were first to market. That was their sweet spot, and they've been good at it for a for a while. We were very much in in catch up mode. But AI is a much younger field. Didn't really exist, let's call it pre-ChatGPT. There, I feel incredibly confident that …”

“Snowflake spent some hundred and fifty million dollars for Neva. I think it's more than paid for itself.”

“I think that core formula of drive and malleability is the advice that I give to a twenty-one-year-old. Honestly, it's the thing that I look for when I am trying to hire you know, take your pick, a senior exec into Snowflake.”

“Too many of our own customers who love Snowflake think of us as like, ah, very good warehouse.”

“If we could get a 30% drawdown, like I would buy Snowflake or buy, ah, Datadog and put it in, you know, put it in a drawer and let those compound for 10 plus years.”

“Snowflake. Like, massive. I mean, when we looked at Snowflake, it had, like, horrible gross margins. Like, but again, it was, we looked at it at five hundred million dollars, and, like, we were completely wrong.”

“And if you look at it too, right, we're three times their growth rate.”

“Five plus years, in my opinion. You know, we bet on the future early days. We bet on AI. We bet on the lake house. We bet on open source. They're just dipping their toe into that.”

“We've done 250. Snowflake, the Databricks migrations, eight of their top 10.”

“Listen, I want to start with Databricks now at a hundred billion dollars worth more than Snowflake.”

“Snowflake had a billion dollar quarter, growing 26%.”

“And so you can look at a business like a snowflake that had negative gross margins very late in their life cycle.”

“When you look at other data clouds, Snowflake, Databricks, Palantir Foundry, they're all in the three to four billion dollar revenue.”

“When I started at Snowflake, I went on eight face-to-face meetings a week, and there were weeks that I couldn't get eight face-to-face, and then the accountability was, I would send out emails to the entire company around my previous week's efforts, and someti…”

“And so we took our eye off the ball for, I want to say, like two years on new logo acquisition, and that hurt us.”

“They're, they are growing faster. They are behind Snowflake, but they are growing faster than Snowflake.”

“Denise came in and she said, we're not going to talk about MQLs or SQLs or anything like that. We're just going to talk about qualified meetings.”

“And we had MySQL as the metadata store, and it was just puking on itself. And so they had to take that and bring in a new thing called FoundationDB to do that. And doing that was a six-month project.”

“Now, in reality, what I should have done is I should have spent more energy going down to the front lines asking the hard questions on a regular basis. And if I had done that, I would have caught some of these bad behaviors.”

“And so I got rid of customer success. Now, customer success is a responsibility of the entire company.”

“Look at Databricks. Their sales team is, they're less revenue than Snowflake. Their sales team is twice the size of Snowflake. Their engineering team is twice the size of the engineering team.”

“We won Nielsen Marketing Cloud and we were trying to sell it to Nike. And Nike was like, who the hell is this little company with a weird name called Snowflake? And what Nike's decision makers did is they cold called the Nielsen marketing team without our know…”

“Coming back from COVID, it was hard to get people to back, back into the offices at Snowflake. And they're like entitled about it.”

“There are people that worked at Snowflake that on the inverse thought it was The company was successful because of them, which was not, never the case. Never.”

“Snowflake's still growing at 30% year over year at billions of dollars in revenue.”

“Worse. Because I don't want to do the hard things. When I say the hard things for a CRO is when you're five hundred million dollars, billion dollars in revenue, getting on a plane and traveling around the world, going on two week trips away from your family.”

“So, so for example, at snowflake, we could do that with our inside sales team. We could get them up and running and quota carrying and successful in three months because the sales cycles were three months”

“I would just would have hired more salespeople and focused on new logo acquisition and pounded on product to give me a notebook and a spark connector, and we would have kicked the shit out of Databricks and they would be dead.”

“If you don't generate your own pipeline, if you don't go on eight face-to-face meetings a week, You're probably gonna fail.”

“The zero to three. Because for the first two years, I didn't get any revenue, and as a salesperson, who you are, is like, you're supposed to bring revenue to the company”

“They buy companies that Snowflake Has had term sheets on for three times or two times the amount of money that Snowflake is offering to buy the companies for, because there's no consequence.”

“They're a pretty dominant, in terms of the data estate, Snowflake and Databricks own the data estate together. And they're complementary for the most part, not, not really competitive.”

“We turn it on, and we went from being like, five X more expensive to 10 X less expensive by just flipping that switch.”

“I, you know, I strongly dislike the CEO of Databricks, but I think Mike, cause he's a dick and he's a liar, but you know, I look, I think at the end of the day, if I, if I'm honest about it, I think the two companies as a combined entity, that would be a amazi…”

“And that's what we did is we were only selling to ad tech companies and online gaming companies in the beginning. And that's where we failed and broke the product and learned a lot. And then we were ready for prime time.”

“Snowflake had this ridiculous net retention rate of 177% when we were going public. Yeah, that was our net retention rate.”

“Snowflake had one skew, a credit, and so we had to measure use cases, and use case wins that have no purchase order.”

“So we have fired managers last year. I went through a certification of second line managers and we fired people because they couldn't sell the product.”

“Plenty of companies that get critiqued for having low gross margins end up being super healthy businesses in the long run. You know, Snowflake was one of the big indicts on Snowflake in the early days was that it had a low gross margin. Obviously it's a very g…”

“Chris and I took a sales organization and grew it faster than any sales organization has ever grown in history. It's snowflake. There might have been others since that have grown faster, but at the time, nobody's done that, right?”

“In the very early days of Snowflake, we could only sell into ad tech accounts. That's it. They were just selling to ad tech.”

“Chris is the only guy that's ever gone from zero to three billion.”

“They don't have a customer success organization at Snowflake, or at least they didn't. Maybe they've created one now, but they didn't. The feeling was everybody's in customer success.”

“In the early days, it was crazy. Like people would buy A 15 K land deal, and they'd expand to 150 in six months, right? So when you have product like that, that just expands on its own, you can get away with less customer success. I've not seen that since Snow…”

“Snowflake, I was there two years before they had a product. So I was there very early.”

“They're going to struggle and fight against each other for the next 10 years, just like SAP and Oracle fought against each other for the last 20.”

“But Snowflake's AI revenue is pretty small. It's a Gentix strategy is just starting, and Databricks rode this to, now they're both at five billion, and Databricks is growing and accelerating at 55% growth.”

“My Pekumumusukus, Pekumumusukus, Palantir, Cloudflare, Mongo, Shopify, CrowdStrike, Snowflake, I'll bet you 10 grand, three of them are in the top six of this cohort at the end of next year.”

“Maybe at some point, even if you're Revolut, if you really want to do deals for real, it's, there are limits to private stock in cash, and if Databricks goes public, and it's worth two to three times Snowflake, it can buy, it may be able to buy the parts of it…”

“He and Sridhar Ramaswamy, the CEO of Soflake, asked me to come in, in, 18 months ago to help find inefficiencies within the go-to-market function and maybe to drive a higher level of performance than we were getting.”

“As you scale, you would expect productivity to come down. The only place I did not see that was Snowflake. We could not hire fast enough to bring the productivity down.”

“Snowflake and Databricks. Very low margin early. A lot of people passed on those early rounds because they're, ah, in SaaS, you have to have 80% gross margin.”

“I think we were the only private investor that was Invested in Snowflake and Databricks when they were both private.”

“The only reason I ding Snowflake is, and this is no, I couldn't do better is it's not founder led. And it's just, that's my thesis today. Like I can't pick Mongo or I killed Mongo or Snowflake just on not being founder led.”

“In the world where, like, Snowflake grew up like, that made sense. In the world we are in today with AI, that doesn't make any sense. Because fundamentally, like, anyone can spin up a competitor of your product in the next two days. Anyone.”

“You see, I saw this with Snowflake and Databricks, right? Snowflake would own everything, and then Databricks would get one small foothold somewhere, and suddenly now they're fighting over the same workloads, and someone's going to win that.”

“You look at like a Snowflake or a Databricks, that's their model, and it's because they're competing over workflows in the account.”

“I think that, I think the best board member that I've ever seen is, is Mike Speiser. I went and in building Snowflake, that guy was so, he was a founder of the company and then he was so involved in the product and he did any, when he didn't know about sales, …”

“Snowflake was the first thing, first company we had ever seen where we couldn't hire fast enough to bring the productivity number down. No matter how fast we hired, it kept going up”

“We had that, I mean, at Snowflake, I had that windfall clause. I probably invoked it five times.”

“At Snowflake, I didn't pay the sellers until they got a book contract, an annual contract.”

“I think, you know, Snowflake did it you know, probably a little bit too late but because it's a consumption model, you have to actually understand the use cases, and then go win those use cases, and get those use cases live, and all this other stuff.”

“One of the missed, I made plenty of mistakes in Europe. One of the mistakes was putting the inside sales team and SDRs in Amsterdam.”

“Snowflake today is worth what? Fifty five billion. So is somebody going to make the argument to me that Databricks is worth two and a half times snowflake? You are, nobody's making that argument to me.”

“We, and I mean, we said it earlier and I said on your last podcast, we should have kept hiring. We slowed down. Because we optimized to be public. And that was a mistake, my opinion. And by the way, I, I'm, I w my hand was on that wheel.”

“I think one year we went from 100 to 300.”

“Databricks can get capital at a higher revenue multiple because they're higher growth rate than Snowflake can and on hassle-free terms.”

“I think the analytic world is getting reshaped already where you can see people like Snowflake or Glean or Databricks. All these people boast enterprise data lakes where you can bring the data and run LLMs against it and get you much more synthesized analytics…”

“We moved away from Looker, right? Google's Looker product for visualizations. It's super expensive, and we moved to do it in Snowflake. And it's been a lot cheaper. It's worked really well. Part of that migration is moving all of our dashboards and all of the …”

“Datadog had this PLG self-service developer-led motion, so you could get started, deploy an agent, instrument your application, never talk to anybody in sales. Snowflake went heavy after the enterprise through, you know, very expensive sales and marketing. I j…”