The Exchanges

Q Okay. So I do, before we do a quick fire, one part of your career we haven't covered is You're angel investing, and you've made some pretty awesome angel investments. What are the top three things you tell startup CEOs?

A The first thing comes to hiring. The first thing I see go right or wrong in a hire is knowing what you are hiring for, and the biggest question people tend to get confused are, and wait with me for a minute on this, is are you hiring a poet, or are you hiring a librarian? Which is to say, For any given role, usually you are trying to mix some blend of process expertise and kind of domain or content expertise. This comes up in every single marketing hire, uh, uh, conversation I have with, uh, with founders. Do you want somebody who knows the space, who can use the product, who is expert in talking to customers, i.e. a poet, Or do you need somebody who understands all of the process machinery of setting up demand gen and the systems and the analytics and, uh, uh, the best practices for customer acquisition, i.e. a librarian? Same thing with engineering. Do you want somebody who's a technical leader who, you know, will understand how to use, you know, who, who will configure Kubernetes in their sleep and, and elevate your Technology prowess, uh, by their personal ingenuity, or do you want somebody who's a process leader who will help the trains run on time and scale the systems? The, the first and biggest place people go wrong is looking for one and, or thinking they need the one or, and hiring the other or not being clear about it. Cause you know, people like you and me tend to b…

AI assessment note: “The first thing comes to hiring. The first thing I see go right or wrong”

Q If you're a startup founder listening with a PLG motion, the question then is like, how do I have the sharpest point going into an organization? How do I hook the champion most effectively? How do you acquire champions in companies most effectively? How do you get that first user to love your product so much that they sell it to the rest of their team?

A One of the key things to understand about PLG is it's not linear. It's not a single product that you have a value proposition for or an experience for that you, uh, you know, sell to one user or market to one user that you then take the same thing and then try and get them to You know, adopt as a team, and then get the same thing, adopt to an enterprise. What makes PLG PLG is it, is, has these distinct, discrete, but complementary, ah, motions and value propositions. I'll give you a specific example. Um, and this, this is like my, I think when you look at PLG, this, this does tend to be true. That first step, that individual free, typically free step, is usually a creation value proposition, right? In the Heroku case, creation meant like building and deploying an app. The second step, which is usually your, your team, uh, self-serve step is usually a collaboration value proposition, right? Think about even like GitHub is another great example, a company I did some work with as a consultant. As an individual developer, I'm using GitHub to, you know, find code, find samples, you know, find libraries, whatever, right? Creation oriented. As a team, I'm using it as part of my workflow as a, in a team in order to collaborate, right? Collaboration value proposition. And then enterprise, what's the, Uh, value there. It's compliance. That's where I have my security. That's where I have …

AI assessment note: “That first step, that individual free, typically free step, is usually a creation value proposition”

Q where you do need to switch chapters, Sometimes name changes happen, Adam, and I hear you're the master of name changes. Literally, like, everyone I spoke to about you was like, Adam comes in, and he's like, let's do a name change, and he masters it, and he does a brilliant job with it, but why, why do you like name changes, and how do you think about strategy here?

A It gets to what I was saying before about capturing that strategic An emotive position. Customers want to love your products. They want to be excited about them, and they want to, um, ah, ah, Understand and kind of inhabit the vision that they represent and the positioning and ultimately the naming is the invitation to do that. Um, so like one, I'll give you, uh, two examples. It's not like it's, it's rocket science, but I think they're pretty good. Uh, so when I was doing some work with GitHub, um, the team there came up with this great product that let you build, uh, workflows and, um, You know, we normally just think about GitHub as kind of like just a code database, right? The idea that you could do kind of workflows on top of that data was an enormous innovation, enormous change for the company. And, you know, there are a bunch of names being kicked around like flows and workflows or stuff like that. And, uh, now, uh, and I'm, I'm happy to take credit for this. Uh, it's of course called GitHub actions. And so think about like workflow versus actions, which product Do you want to use? Which kind of captures the essence of, of what this product was about, right? If you, one way of thinking about what was behind that product naming was GitHub was this kind of inert, right? Um, uh, set of nouns, right? It's just a database. It's just, you know, you're, you're just interacting …

AI assessment note: “capturing that strategic An emotive position... ultimately the naming is the invitation to do that”

Q Okay. So I do, before we do a quick fire, one part of your career we haven't covered is You're angel investing, and you've made some pretty awesome angel investments. What are the top three things you tell startup CEOs?

A The first thing comes to hiring. The first thing I see go right or wrong in a hire is knowing what you are hiring for, and the biggest question people tend to get confused are, and wait with me for a minute on this, is are you hiring a poet, or are you hiring a librarian? Which is to say, For any given role, usually you are trying to mix some blend of process expertise and kind of domain or content expertise. This comes up in every single marketing hire, uh, uh, conversation I have with, uh, with founders. Do you want somebody who knows the space, who can use the product, who is expert in talking to customers, i.e. a poet, Or do you need somebody who understands all of the process machinery of setting up demand gen and the systems and the analytics and, uh, uh, the best practices for customer acquisition, i.e. a librarian? Same thing with engineering. Do you want somebody who's a technical leader who, you know, will understand how to use, you know, who, who will configure Kubernetes in their sleep and, and elevate your Technology prowess, uh, by their personal ingenuity, or do you want somebody who's a process leader who will help the trains run on time and scale the systems? The, the first and biggest place people go wrong is looking for one and, or thinking they need the one or, and hiring the other or not being clear about it. Cause you know, people like you and me tend to b…

AI assessment note: “The first thing comes to hiring. The first thing I see go right or wrong”

Q dude, this is going to be great. So we're going to start with like a, an interesting quick fire. So when we look at the different companies that you've been at, there's some iconic brands there. And I want to do basically, what's your biggest takeaway from each and how did it impact your mindset? And so if we start with number one, Salesforce, what would that be for you?

A I'll try and keep these brief. We'll see how I do. I'm not, I'm not known for my brevity. You know, so I was very lucky to be, uh, very early at Salesforce. I joined in, um, uh, One of the things that people don't maybe understand about Salesforce looking at it as this huge big enterprise software company now is that thing was built brick by brick. That thing was built, um, uh, uh, through the pure kind of energy and intentionality of all the people on the team there, which was amazing. And so what I really learned there was just the kind of genuine power of a growth mindset and what that really means and what that means applied every single day. That thing was forged into existence. It didn't just kind of get lucky, right place, right time, and that was a very powerful lesson.

AI assessment note: “what I really learned there was just the kind of genuine power of a growth mindset”

Q Okay, final one, Heroku. What, what was the big lesson from Heroku?

A You know, Heroku, uh, was where I was finally able to See PLG in full IMAX, three D glory, where we were able to kind of connect the dots between a really powerful individual free product, a strong community, all the way up through, you know, large enterprise customers who paid us a million dollars a year. And frankly, to prove to myself, and I think to some skeptical people that one plus one can equal three. You know, so my era of Heroku started in 2013. So now, you know, over 10 years ago. But at the time it was I think there was not as much proven. You can really have your cake and eat it, too, in a real kind of emotive, empathetic, individual, high quality product and also build great enterprise features as well. They were viewed as somewhat intentioned with each other and if not in outright conflict. And we were able to synthesize them in a beautiful way.

AI assessment note: “prove to myself, and I think to some skeptical people that one plus one can equal three”

Q Do you think there's much value to be created in that layer? I mean, that was respectful. Like, do you not think that the core value accrues that your open AI of the world who did voice synthesis And single-handedly kind of destroyed a layer of voice creators in its path.

A I'm of two minds on this. I think a lot of AI value will accrue to existing large distribution players. AI is not, um, naturally disruptive in the way that the shift from on-prem to cloud was, right, which obviously I had a front row seat to. Moving from on-prem to cloud, the reason why so many companies were so poor in doing it is it required not an upending of their product, It required an upending of their business models, moving from perpetual licensing from a sales point of view, from a finance point of view, moving from an engineering process that, you know, deliver software on CD that to delivering continuously on the internet and operating a service versus just shipping software. These are tectonic shifts in how an organization structures and runs itself. And the further and more public company you are, the harder that is to execute. So that was like, Right. That's why it was so, so hard to do, and we saw so much opportunity for new entrants in SAS. AI is not the same. AI is much more of a continuous, a continuing innovation where it's much easier for incumbents to, and including Vimeo, to adopt, um, and take advantage, uh, of these technologies without upending, you know, their entire company structure. So I think it's, it's not good. This isn't, this isn't like, you know, early SAS days where all this new value will be created. That said, when we dream about user expe…

AI assessment note: “I'm of two minds on this. I think a lot of AI value will accrue”

Q I totally get you. What do people get wrong on the strategic impact side? What are the mistakes that are made there?

A They think about the world too much from their, uh, their worldview, their, their situation, their consciousness out versus customer in. The hardest thing, um, about being strategic and about kind of having, uh, uh, that, that transformation narrative is having genuine, what I like to think about sometimes is enterprise empathy. What it's very hard for organizations to do is have enterprise empathy. Which really means being able to understand how your product sits in the full context of your customer. It's politics, it's org structure, it's business processes, it's successes, it's dysfunctions. All of your products are kind of sitting in this context, and to genuinely understand that, uh, uh, takes, you know, a real kind of presence of mind.

AI assessment note: “consciousness out versus customer in”

Q Can I ask you, what are the most common ways that you see growth plateau? In fast growing companies. We mentioned Vercel, we mentioned Linear there. We're growing incredibly well now, so not in that batch, but in companies that do plateau in growth, why?

A A lot of it is, do you have a culture of really serving the customer? Regardless of what that means. This is the, this is the, um, maybe kind of the, the, the, the implicit contradiction, um, of, of being a high growth company. I see this play out all the time. And, you know, arguably, you know, even Dropbox and GitHub, um, and in Heroku have fallen into this in different times. You have this initial thing, this initial idea that whether you're GitHub, again, Dropbox, Roku, you name it, Git push Roku master, you know, sync, you name it. You have this initial thing that has generated unimaginable success. You've gone not just from zero to one, but zero to 10, zero to a hundred. You've broken through on the internet. Like that is one of the rarest things to do. And You develop internal ideas and theories about why that was the case. This one thing that you did, the set of values that that thing represented was this thing that got you to this unimaginable place of success relative to all the odds and all the other companies out there. And then you have to say, I'm going to put those aside or I'm going to challenge those, or I'm going to think beyond that and develop a new framework of value or a way of Uh, of contradicting even maybe some of the principles that got us this far in order to serve customers at that next level of impact or depth, and that is a very, very hard thing fo…

AI assessment note: “a way of contradicting even maybe some of the principles that got us this far”

Q Sarah Tavill from Benchmark said that we will sell the services and not the tools. So instead of, to your point, selling the, you know, uh, the creation tool, it will sell the output of the creation tool, which AI will have Created the product itself. You know, we see in a lot of co-creation, um, AI services. Do you agree with that transition?

A I would kind of call that maybe like full stack AI, right? Versus kind of an AI tool thing. And absolutely. What an interesting opportunity that is. You see hints, just hints of this. If you look at, and, um, I, I hope I'm getting this right. If you look at some of the support Companies moving from, um, seat licensing, support tool companies, uh, to incident resolution. That's getting, that's further up the stack. That's closer to business value. That's closer to kind of selling, um, uh, the end result and output. Um, if you really squint, you know, what does that look like in other kinds of industries? What would it mean to pay a CRM company per lead?

AI assessment note: “And absolutely. What an interesting opportunity that is.”

Q co-president and the chief business officer, head of growth at Spotify, and he talks about committing surgery on yourself, which is essentially examining yourself in that core moment of intersection And realizing that you might have to kill the golden goose that's got you to stage two to get to stage three. How do you think about sometimes needing to really examine the core to get to the next level?

A Amen. Amen. And I think you know you're doing it wrong when the company tells itself, you know, uh, it gets too religious about its own culture, and ultimately it gets too introspective Um, and just broadly inwardly focused, right? We, we are successful because we've always done it this way. You know, we have whatever T special t-shirts on Fridays that we spend an exquisite amount of time building GitHub and Heroku that, um, you know, this is so core to our culture. Clearly this has to be the reason for our success and almost in like this religious way. Where, you know, you, you, you don't even know where the growth comes from. You're just afraid of upsetting the growth gods. You, you, you, you, uh, uh, romanticize or elevate these kind of semi-arbitrary aspects of your internal culture that have served you very well in the past, but are not what's going to get you, uh, to where you go. We need to go in the future. That comes, that's part of you asked before what's growth, growth mindset. That's growth mindset. Right? Is being so religiously customer focused that you're willing to, um, uh, challenge the core values that you genuinely believe have contributed to your success because they may not be the values or the strategies that will deliver that next frontier of growth.

AI assessment note: “challenge the core values that you genuinely believe have contributed to your success”

Q I mean, it was an incredible journey. If we've mentioned the word growth a lot, and so I do want to dig in and start there. Respectfully, it's a little bit misused today as a term. When we think about what growth is, what is growth and what is it not, Adam?

A It's interesting. I think what growth means, and I honestly don't love like the title VP of growth and I don't love growth function because all of that stuff, and I, I have deep respect for, for the work. I've done a lot of it myself. It is a lot of local maxima, right? It's how to, it's optimization. It's improving a flow. It's improving a journey. All of that is really, really important, but that's more kind of bottoms up growth, right? That kind of optimization where I spend a lot of time, uh, with the companies I've led or, or work with as an angel investor or board member is a little more of the top down idea of growth, which is fundamentally, how do you set a vision For yourself, for your customers, that you can articulate and communicate at scale that is going to be transformative for them and is going to be really, really valuable and is empathetic to where they are as an organization. And that is ultimately what's going to kind of propel your, your business. So, um, that's a little of the less common version of growth, but one that I like to advocate for a lot.

AI assessment note: “that's more kind of bottoms up growth... top down idea of growth, which is fundamentally”

Q I totally get you. What do people get wrong on the strategic impact side? What are the mistakes that are made there?

A They think about the world too much from their, uh, their worldview, their, their situation, their consciousness out versus customer in. The hardest thing, um, about being strategic and about kind of having, uh, uh, that, that transformation narrative is having genuine, what I like to think about sometimes is enterprise empathy. What it's very hard for organizations to do is have enterprise empathy. Which really means being able to understand how your product sits in the full context of your customer. It's politics, it's org structure, it's business processes, it's successes, it's dysfunctions. All of your products are kind of sitting in this context, and to genuinely understand that, uh, uh, takes, you know, a real kind of presence of mind.

AI assessment note: “They think about the world too much from their, uh, their worldview”

Q Do you think there's much value to be created in that layer? I mean, that was respectful. Like, do you not think that the core value accrues that your open AI of the world who did voice synthesis And single-handedly kind of destroyed a layer of voice creators in its path.

A I'm of two minds on this. I think a lot of AI value will accrue to existing large distribution players. AI is not, um, naturally disruptive in the way that the shift from on-prem to cloud was, right, which obviously I had a front row seat to. Moving from on-prem to cloud, the reason why so many companies were so poor in doing it is it required not an upending of their product, It required an upending of their business models, moving from perpetual licensing from a sales point of view, from a finance point of view, moving from an engineering process that, you know, deliver software on CD that to delivering continuously on the internet and operating a service versus just shipping software. These are tectonic shifts in how an organization structures and runs itself. And the further and more public company you are, the harder that is to execute. So that was like, Right. That's why it was so, so hard to do, and we saw so much opportunity for new entrants in SAS. AI is not the same. AI is much more of a continuous, a continuing innovation where it's much easier for incumbents to, and including Vimeo, to adopt, um, and take advantage, uh, of these technologies without upending, you know, their entire company structure. So I think it's, it's not good. This isn't, this isn't like, you know, early SAS days where all this new value will be created. That said, when we dream about user expe…

AI assessment note: “I think a lot of AI value will accrue to existing large distribution players.”

Q Okay, final one, Heroku. What, what was the big lesson from Heroku?

A You know, Heroku, uh, was where I was finally able to See PLG in full IMAX, three D glory, where we were able to kind of connect the dots between a really powerful individual free product, a strong community, all the way up through, you know, large enterprise customers who paid us a million dollars a year. And frankly, to prove to myself, and I think to some skeptical people that one plus one can equal three. You know, so my era of Heroku started in 2013. So now, you know, over 10 years ago. But at the time it was I think there was not as much proven. You can really have your cake and eat it, too, in a real kind of emotive, empathetic, individual, high quality product and also build great enterprise features as well. They were viewed as somewhat intentioned with each other and if not in outright conflict. And we were able to synthesize them in a beautiful way.

AI assessment note: “where I was finally able to See PLG in full IMAX, three D glory”

Q So do you think founders should not hire independent growth teams?

A No, I mean, you know, I've had and run growth teams, um, and growth teams are super important. Um, I think founders need to balance where their theory, so one thing I like to think a lot about and talk to, uh, companies and founders I work with a lot about is, is what's your theory of your business? Which is another way of saying, kind of holistically, where your customers are going to come from, how are you going to make them successful, how are you ultimately going to, you know, Uh, uh, make them profitable growing customers, both in terms of them getting value and, and, and your business, uh, getting revenue. And the thing about kind of just bottoms up growth is it's just very narrow in its perspective. It doesn't, uh, uh, take the kind of holistic view of how does your product value proposition, uh, interact with the customer experience of how they engage with your product? What's the journey that your customer goes on? If they start as an individual free user and then convert to a self-serve paid user, maybe as a team, and then from there convert into an enterprise customer, each of these kind of different phase transitions, this is kind of a whole architecture of a business. And so I really encourage founders to think, uh, more holistically, um, about all the pieces and how they come together, because that is the hardest thing about growth in the modern SaaS era, is that …

AI assessment note: “No, I mean, you know, I've had and run growth teams”

Q Should they think holistically about it from day one, or do you really just need to focus on the next step, the next step in the zero to one phase?

A Maybe not day one, but definitely, um, year two. You know, day one, sure, you're just building prototypes here, you're kind of MVP-ing, you're, at some point, you need to decide, um, who is your customer? Not just from a use case Uh, uh, and value proposition point of view, but from, uh, uh, kind of a go to market point of view, which the best proxy for that is deal size. Are you going to get from, you know, year one to year three, from Siri, from seed to A, or maybe A to B, depending on how you name the rounds, right? Are you going to get there by getting X customers at 50 K a pop or Y customers at five K a pop? And That is like, right, the physics of those two systems are entirely different. And at some point, you got to decide, and you have to decide pretty early because nobody has ever raised an A or I would think a B doing both. You just would spread yourself far too thin, uh, attempting to do both. And it, it's a very, very challenging, uh, discussion to have, especially in the early days, because if you're doing founder-led sales or even early, right, MVP development, by definition, you're more in the, A category of fewer larger customers, right? Because it's very personal and engaged. So companies can say, oh, well, I'm gonna go down, or founders go down that path and say, great, I'll just get more of those. And you realize, well, you know, it's easy to get the first fi…

AI assessment note: “Maybe not day one, but definitely, um, year two.”

Q What is the biggest mistake that founders make when moving from stage one creation to stage two collaboration in teams?

A I think the biggest mistake is not understanding that it's different, not approaching it with the intentionality of it's going to require a different value proposition that, uh, having a single player, I mean, this PLG is hard, right? Having a single player product, a product that has value on a single player basis, and that you can then build, uh, uh, a multiplayer Right? Collaboration product experience on. You're doing MVP. You're doing, um, uh, product market fit twice. That's so, and I've seen this a bunch, and I've seen companies I've invested in not make it, where they get the individual value proposition, but they're not able to translate to the collaborative value proposition. It's just, it's super hard.

AI assessment note: “biggest mistake is not understanding that it's different, not approaching it with the intentionality”

Q What have we done to create these emotive brands, and how do you create emotive brands, then? Sorry, I know it sounds...

A You, you, you start by thinking that it's important to do so. You, you have to, in the kind of consciousness of your company, you know, have some intentionality to say, this is important. Experience is important. This is, why do, like, big old software companies suck? Because they're not experience-oriented. They're not, they don't care about these things. They've lost the connection to the individual user. It's why these companies tend to be PLG companies, because to get the individual user, you have to be empathetic. You have to, uh, you know, care about experience. You have to have meetings with the CEO, you know, and, you know, the management team where you're debating minor switches in the command line, which trust me, we did at Heroku. So you have to care. So, but a motive is just half of it, right? The other part you have to do is be strategic. And if you're a motive and you're not strategic, you're interesting and cool, but you'll never command the kind of business impact and ultimately, uh, budgets and ultimately, you know, growth for your company that you're trying to look for. And it's on that strategic dimension that this idea of transformation narrative or just strategic impact is maybe another way of thinking about that. That's so important.

AI assessment note: “You start by thinking that it's important to do so.”

Q co-president and the chief business officer, head of growth at Spotify, and he talks about committing surgery on yourself, which is essentially examining yourself in that core moment of intersection And realizing that you might have to kill the golden goose that's got you to stage two to get to stage three. How do you think about sometimes needing to really examine the core to get to the next level?

A Amen. Amen. And I think you know you're doing it wrong when the company tells itself, you know, uh, it gets too religious about its own culture, and ultimately it gets too introspective Um, and just broadly inwardly focused, right? We, we are successful because we've always done it this way. You know, we have whatever T special t-shirts on Fridays that we spend an exquisite amount of time building GitHub and Heroku that, um, you know, this is so core to our culture. Clearly this has to be the reason for our success and almost in like this religious way. Where, you know, you, you, you don't even know where the growth comes from. You're just afraid of upsetting the growth gods. You, you, you, you, uh, uh, romanticize or elevate these kind of semi-arbitrary aspects of your internal culture that have served you very well in the past, but are not what's going to get you, uh, to where you go. We need to go in the future. That comes, that's part of you asked before what's growth, growth mindset. That's growth mindset. Right? Is being so religiously customer focused that you're willing to, um, uh, challenge the core values that you genuinely believe have contributed to your success because they may not be the values or the strategies that will deliver that next frontier of growth.

AI assessment note: “challenge the core values that you genuinely believe have contributed to your success”

Q Sarah Tavill from Benchmark said that we will sell the services and not the tools. So instead of, to your point, selling the, you know, uh, the creation tool, it will sell the output of the creation tool, which AI will have Created the product itself. You know, we see in a lot of co-creation, um, AI services. Do you agree with that transition?

A I would kind of call that maybe like full stack AI, right? Versus kind of an AI tool thing. And absolutely. What an interesting opportunity that is. You see hints, just hints of this. If you look at, and, um, I, I hope I'm getting this right. If you look at some of the support Companies moving from, um, seat licensing, support tool companies, uh, to incident resolution. That's getting, that's further up the stack. That's closer to business value. That's closer to kind of selling, um, uh, the end result and output. Um, if you really squint, you know, what does that look like in other kinds of industries? What would it mean to pay a CRM company per lead?

AI assessment note: “And absolutely. What an interesting opportunity that is.”

Q What have we done to create these emotive brands, and how do you create emotive brands, then? Sorry, I know it sounds...

A You, you, you start by thinking that it's important to do so. You, you have to, in the kind of consciousness of your company, you know, have some intentionality to say, this is important. Experience is important. This is, why do, like, big old software companies suck? Because they're not experience-oriented. They're not, they don't care about these things. They've lost the connection to the individual user. It's why these companies tend to be PLG companies, because to get the individual user, you have to be empathetic. You have to, uh, you know, care about experience. You have to have meetings with the CEO, you know, and, you know, the management team where you're debating minor switches in the command line, which trust me, we did at Heroku. So you have to care. So, but a motive is just half of it, right? The other part you have to do is be strategic. And if you're a motive and you're not strategic, you're interesting and cool, but you'll never command the kind of business impact and ultimately, uh, budgets and ultimately, you know, growth for your company that you're trying to look for. And it's on that strategic dimension that this idea of transformation narrative or just strategic impact is maybe another way of thinking about that. That's so important.

AI assessment note: “You start by thinking that it's important to do so.”

Q If you're a startup founder listening with a PLG motion, the question then is like, how do I have the sharpest point going into an organization? How do I hook the champion most effectively? How do you acquire champions in companies most effectively? How do you get that first user to love your product so much that they sell it to the rest of their team?

A One of the key things to understand about PLG is it's not linear. It's not a single product that you have a value proposition for or an experience for that you, uh, you know, sell to one user or market to one user that you then take the same thing and then try and get them to You know, adopt as a team, and then get the same thing, adopt to an enterprise. What makes PLG PLG is it, is, has these distinct, discrete, but complementary, ah, motions and value propositions. I'll give you a specific example. Um, and this, this is like my, I think when you look at PLG, this, this does tend to be true. That first step, that individual free, typically free step, is usually a creation value proposition, right? In the Heroku case, creation meant like building and deploying an app. The second step, which is usually your, your team, uh, self-serve step is usually a collaboration value proposition, right? Think about even like GitHub is another great example, a company I did some work with as a consultant. As an individual developer, I'm using GitHub to, you know, find code, find samples, you know, find libraries, whatever, right? Creation oriented. As a team, I'm using it as part of my workflow as a, in a team in order to collaborate, right? Collaboration value proposition. And then enterprise, what's the, Uh, value there. It's compliance. That's where I have my security. That's where I have …

AI assessment note: “That first step, that individual free, typically free step, is usually a creation value proposition”

Q Should they think holistically about it from day one, or do you really just need to focus on the next step, the next step in the zero to one phase?

A Maybe not day one, but definitely, um, year two. You know, day one, sure, you're just building prototypes here, you're kind of MVP-ing, you're, at some point, you need to decide, um, who is your customer? Not just from a use case Uh, uh, and value proposition point of view, but from, uh, uh, kind of a go to market point of view, which the best proxy for that is deal size. Are you going to get from, you know, year one to year three, from Siri, from seed to A, or maybe A to B, depending on how you name the rounds, right? Are you going to get there by getting X customers at 50 K a pop or Y customers at five K a pop? And That is like, right, the physics of those two systems are entirely different. And at some point, you got to decide, and you have to decide pretty early because nobody has ever raised an A or I would think a B doing both. You just would spread yourself far too thin, uh, attempting to do both. And it, it's a very, very challenging, uh, discussion to have, especially in the early days, because if you're doing founder-led sales or even early, right, MVP development, by definition, you're more in the, A category of fewer larger customers, right? Because it's very personal and engaged. So companies can say, oh, well, I'm gonna go down, or founders go down that path and say, great, I'll just get more of those. And you realize, well, you know, it's easy to get the first fi…

AI assessment note: “Maybe not day one, but definitely, um, year two.”

Q What is the biggest mistake that founders make when moving from stage one creation to stage two collaboration in teams?

A I think the biggest mistake is not understanding that it's different, not approaching it with the intentionality of it's going to require a different value proposition that, uh, having a single player, I mean, this PLG is hard, right? Having a single player product, a product that has value on a single player basis, and that you can then build, uh, uh, a multiplayer Right? Collaboration product experience on. You're doing MVP. You're doing, um, uh, product market fit twice. That's so, and I've seen this a bunch, and I've seen companies I've invested in not make it, where they get the individual value proposition, but they're not able to translate to the collaborative value proposition. It's just, it's super hard.

AI assessment note: “the biggest mistake is not understanding that it's different, not approaching it with the intentionality”

Q How do you do effective product marketing there? Say you have a billboard, Okay. And you want to emphasize the abilities that you're able to deliver with creation tools. And then you also want to emphasize the team and the collaboration features. How do you do two stages of product marketing on one billboard or one advert?

A That's an excellent, um, excellent question. And usually this debate comes up not in the billboard, but in the homepage of the website, right? And, you know, imagine now when you've got the full-fledged PLG model, you've got Enterprise II. How do you manage that? I mean, uh, uh, Friend of mine runs the website for, for GitHub, and this is, you know, classic GitHub problem in spades. My default is The website is about the top of the funnel, is about establishing the initial customer relationship. So you want to yoke towards that free customer acquisition, and that's kind of the primary thing. Now any website does multiple things, but that's kind of the primary goal. Because once you are engaged with them in the product, you have all kinds of additional communication mechanisms, in product, out of product, events, you name it, to engage with them and move them on the journey. But the website is frankly a kind of a blunt instrument And so, uh, point it at that kind of largest pool of unwashed masses. And then as you kind of pull them up into your journey, into your, into your, uh, company experience, you, you reveal the different ways of engaging with them and delivering these other messages. I mean, if even if you look, well, it's been a long time since I've been in Heroku, but you know, the Heroku core website really was always just about getting free developers to sign up. And …

AI assessment note: “The website is about the top of the funnel, is about establishing the initial customer relationship.”

Q Okay, do I have to have a planning methodology from day one? And I know you said that you can use whatever one you want, but do you advise any founders on a specific type that generally works well from zero to one?

A You know, the very simple version is make sure you're all getting in a room ideally cross organizationally and spending the time to hammer it out. So it's usually a day or two minimum to get to your eight shared priorities in stack rank. If that's the simplest recipe, if you're trying to take anything on, I, I, so, uh, I've, I've done a bunch of work with tail scale. Um, I brought this to the organization, uh, in, in this case, how we are structuring the self-serve business. And with having that clarity, having the time spent across organization to say, these are just even the buckets, how we're thinking about things. And this is their stack rank as it's simple. It doesn't have to be complicated. It's hugely powerful. You will know when the team feels the value. It won't feel like that. Okay. Our spreadsheet that's pointless and administrative. It'll feel like, ah, clarity alignment. Okay. Let's go. We, we, we now know what we need to do.

AI assessment note: “make sure you're all getting in a room ideally cross organizationally and spending the time”

Q How do you advise founders on channel diversification there? You said there about kind of having that one channel that works, that one innovative customer acquisition channel. I hear a lot who are like, you know, I need to diversify. What happens if, You know, we have too much channel risk. How do you advise them on that, and when's the right time to try and add a second channel?

A Yeah, well, when I think about the, the, going back to kind of what I was saying before, you know, enterprise versus kind of PLG or self-serve, right? How do you think about that decision? Um, my rule of thumb there is you only get to have one, one of those until at least ten million, if not further. If you're up at like five, six million, and you're like, gee, now's the time to add enterprise, usually the challenge is companies going enterprise too soon. Because it's very tempting. It can be the other way of companies going, uh, trying to, you know, go into PLG from enterprise, which is a much harder path to go. If you're doing that under ten million, I just think, you know, it, it, you're not big enough. It's too distracting. You haven't built enough of the machine. So, um, I, I guess I tend to be on the conservative side. Uh, and I, I, as we were saying before, I would hope that a channel would get you pretty far. Um, you know, again into the, you mentioned 50 before, a hundred, um, before you, and maybe it's also, you know, I think about a full-fledged channel as in a full-fledged enterprise sales organization with all the SCs and SDRs and, you know, all the mechanics and machinery. That takes a lot to, to really get spun up.

AI assessment note: “you only get to have one, one of those until at least ten million”

Q So do you think founders should not hire independent growth teams?

A No, I mean, you know, I've had and run growth teams, um, and growth teams are super important. Um, I think founders need to balance where their theory, so one thing I like to think a lot about and talk to, uh, companies and founders I work with a lot about is, is what's your theory of your business? Which is another way of saying, kind of holistically, where your customers are going to come from, how are you going to make them successful, how are you ultimately going to, you know, Uh, uh, make them profitable growing customers, both in terms of them getting value and, and, and your business, uh, getting revenue. And the thing about kind of just bottoms up growth is it's just very narrow in its perspective. It doesn't, uh, uh, take the kind of holistic view of how does your product value proposition, uh, interact with the customer experience of how they engage with your product? What's the journey that your customer goes on? If they start as an individual free user and then convert to a self-serve paid user, maybe as a team, and then from there convert into an enterprise customer, each of these kind of different phase transitions, this is kind of a whole architecture of a business. And so I really encourage founders to think, uh, more holistically, um, about all the pieces and how they come together, because that is the hardest thing about growth in the modern SaaS era, is that …

AI assessment note: “No, I mean, you know, I've had and run growth teams”

Q Okay, do I have to have a planning methodology from day one? And I know you said that you can use whatever one you want, but do you advise any founders on a specific type that generally works well from zero to one?

A You know, the very simple version is make sure you're all getting in a room ideally cross organizationally and spending the time to hammer it out. So it's usually a day or two minimum to get to your eight shared priorities in stack rank. If that's the simplest recipe, if you're trying to take anything on, I, I, so, uh, I've, I've done a bunch of work with tail scale. Um, I brought this to the organization, uh, in, in this case, how we are structuring the self-serve business. And with having that clarity, having the time spent across organization to say, these are just even the buckets, how we're thinking about things. And this is their stack rank as it's simple. It doesn't have to be complicated. It's hugely powerful. You will know when the team feels the value. It won't feel like that. Okay. Our spreadsheet that's pointless and administrative. It'll feel like, ah, clarity alignment. Okay. Let's go. We, we, we now know what we need to do.

AI assessment note: “get to your eight shared priorities in stack rank. If that's the simplest recipe”