The Exchanges

Q Not at all, but I'd love to kick off today by discussing a little bit about you, and how did you make the move from Amazon intern to founding one of San Francisco's hottest companies in the form of HashiCorp, and what's that founding story in a succinct two to three minutes?

A Yeah, you know, I mean, I think the comments Thread through all of that is my good friend Mitchell Hashimoto. We actually went to University of Washington together, and we're in the same computer science program, and so we ended up meeting each other fairly early in that program, and from the beginning, we were on a research project together, working on sort of side projects and various, I'll call them startup lights, while we were still in school, and eventually, once we graduated, both of us ended up at the same mobile advertising firm, where Mitchell was really focused More on the operational side of the house, and I was more on application development and application architecture. And the thing that became painfully obvious to us, sort of, after working closely together for many years, was there's this gap in the market of operational tooling, right? Whether we were doing it as part of our research project, or as a, our own startup, or as part of our day job at the advertising company, we found that we were sort of reinventing the tooling necessary to provision and manage cloud infrastructure, right? And I think what was sort of strange for us was, When we first started, it was like, okay, cloud was new. It was 2007. So we expected a lack of tooling, but come 2013, we're at the ad tech company and we're still reinventing the tooling. And I think for us, it was clear that th…

AI assessment note: “what if we started a company that just focused on this?”

Q It has. No, I totally get you in that. Slight, slight discomfort. But I do have to ask, in terms of kind of founders listening, contemplating doing the same, what advice would you have for them in their approach, their mindset, and how to think about it?

A I think it's a few things. I think you have to be really, really honest with yourself about what are your own strengths, right? What are the things you really want to focus on, and what are the things you really want, you know, your CEO or COO to focus on? I think what I've seen fail is People who are like, okay, I want to bring in a CEO, but I don't want to give up anything. I want to still be involved with all aspects of the business. And you're like, okay, so in effect, you still want to be CEO. You just want to have a second CEO that you don't delegate anything or authority to. And that doesn't work. Right. And I think for me and Mitchell, what was really, really clear was we felt like our strength was in understanding the problem domain and sort of understanding and empathizing with the end users and driving the product. Right. So the product management aspect of the product vision was what we felt was sort of our strength. The areas that we said, you know what, we don't really know what we're doing here is building out the go to market. How do we think about the marketing team and the sales function and customer success and building out the whole pipeline and channel and ecosystem and all that kind of stuff. And so I think as we went through the sort of dating process, I think we were really honest around like, here's how we think this partnership would work. Cause I thin…

AI assessment note: “be really, really honest with yourself about what are your own strengths”

Q Tell me, how long do you give it?

A It's hard. I think usually it depends, I think, on the strength of our conviction, right? I think there's been some of our tools that probably the tool we held on to the longest was Terraform. You know, I think Terraform going on a year and a half, two years was probably still in that flat line period, but we felt so strongly about it. That we weren't willing to sort of abandon it, and I think the tool for us that was sort of the two that were faster was our surf tool that I think was probably on the order of six to nine months before we said, you know what, we've missed the mark, let's try again, as well as our auto tool that was about nine months to a year before we decided to kill that one.

AI assessment note: “tool we held on to the longest was Terraform... year and a half, two years”

Q we've got to love the global 2000 for that. I do want to talk about a concern for me with open source projects, which is often the professional services element. You know, the likes of Hortonworks extensively invest in theirs, and hence the -75 gross margin. How do you think about professional services and the gross margins and potential maybe dent on profitability that it can be associated with it?

A Yeah, I think from the very beginning, our view was I think professional services are dangerous for sort of two different reasons. I think one side, as you put it, is that, you know, have this margin issue, right, which is the margin you're going to generate on professional services is not great, and that business doesn't tend to be renewable in the same way software is. So I think from the very beginning, we didn't really want that to be our focus. The other side of it is I think it can lead to a misincentive from the product perspective, which is if I'm driving an enormous amount of services dollars dealing with Product issues, dealing with its sharp edges, dealing with sort of its lack of operability, then am I properly incentivized to fix those from a product perspective? Or is there this moral hazard that, you know, actually it's okay for the tool to be relatively inoperable because it generates services business for us? So I think that to us was sort of always something we were aware of as we don't want to create this incentives issue internally, in addition to the, to having sort of the margin issues and kind of the valuation impact.

AI assessment note: “our view was I think professional services are dangerous for sort of two different reasons”

Q Not at all, but I'd love to kick off today by discussing a little bit about you, and how did you make the move from Amazon intern to founding one of San Francisco's hottest companies in the form of HashiCorp, and what's that founding story in a succinct two to three minutes?

A Yeah, you know, I mean, I think the comments Thread through all of that is my good friend Mitchell Hashimoto. We actually went to University of Washington together, and we're in the same computer science program, and so we ended up meeting each other fairly early in that program, and from the beginning, we were on a research project together, working on sort of side projects and various, I'll call them startup lights, while we were still in school, and eventually, once we graduated, both of us ended up at the same mobile advertising firm, where Mitchell was really focused More on the operational side of the house, and I was more on application development and application architecture. And the thing that became painfully obvious to us, sort of, after working closely together for many years, was there's this gap in the market of operational tooling, right? Whether we were doing it as part of our research project, or as a, our own startup, or as part of our day job at the advertising company, we found that we were sort of reinventing the tooling necessary to provision and manage cloud infrastructure, right? And I think what was sort of strange for us was, When we first started, it was like, okay, cloud was new. It was 2007. So we expected a lack of tooling, but come 2013, we're at the ad tech company and we're still reinventing the tooling. And I think for us, it was clear that th…

AI assessment note: “that kind of led to us saying, you know what, what if we started a company”

Q we've got to love the global 2000 for that. I do want to talk about a concern for me with open source projects, which is often the professional services element. You know, the likes of Hortonworks extensively invest in theirs, and hence the -75 gross margin. How do you think about professional services and the gross margins and potential maybe dent on profitability that it can be associated with it?

A Yeah, I think from the very beginning, our view was I think professional services are dangerous for sort of two different reasons. I think one side, as you put it, is that, you know, have this margin issue, right, which is the margin you're going to generate on professional services is not great, and that business doesn't tend to be renewable in the same way software is. So I think from the very beginning, we didn't really want that to be our focus. The other side of it is I think it can lead to a misincentive from the product perspective, which is if I'm driving an enormous amount of services dollars dealing with Product issues, dealing with its sharp edges, dealing with sort of its lack of operability, then am I properly incentivized to fix those from a product perspective? Or is there this moral hazard that, you know, actually it's okay for the tool to be relatively inoperable because it generates services business for us? So I think that to us was sort of always something we were aware of as we don't want to create this incentives issue internally, in addition to the, to having sort of the margin issues and kind of the valuation impact.

AI assessment note: “professional services are dangerous for sort of two different reasons”

Q of that different operating. I did chat to Samuel Shaw, one of your investors before the show, and we mentioned the element of you bucking conventional wisdom there, and he said that you've bucked it in numerous cases, you and Mitchell. So tell me, what are the other elements, or if there's kind of one that stands out where you've really bucked conventional wisdom, and what were the associated learnings?

A I think the biggest one, the one that everyone told us was that, you know, would be our doom. The number one startup advice, I think, is focus, focus, focus. Pick a niche, aggressively focus on it, figure out the one thing that works, and then go all in. I think when you look at HashiCorp, it's sort of the polar opposite, right? We have six major open source projects that sell to four completely different audiences, right? Whether it's, you know, security people, networking people, operations people, developers. So I think in some sense, we end up looking like the antithesis of focus. It's many products Many markets, many different buyers, and for us, I think this really comes back to an assertion we had from the very beginning, which was me and Mitchell having been in the shoes of the operator, our frustration was, I don't want to have to buy 15 niche tools from 15 different vendors, and then it's my responsibility to figure out how to glue all these things together, right? And it's, everything is a square peg in a round hole, and so the pain on my side becomes, I'm gluing together a bunch of stuff that was never meant to be interoperable, versus at HashiCorp, we said, you know what, Could we build this entire portfolio where the pain of doing the integrations and making sure all of these things work together doesn't fall on our end user. It falls on us. And so this moves from…

AI assessment note: “The number one startup advice, I think, is focus, focus, focus.”

Q No, absolutely, and speaking about that exciting life, I want to finish on the next five years for you and for HashiCorp. What's in the really exciting roadmap?

A You know, I think the way we kind of think about the next five years is how do we continue to innovate, right? I think in general, people tend to see HashiCorp at the forefront of a lot of what's happening in DevOps, And we want to make sure that that stays true. So there's some fun stuff in the skunk works. I think the other side of it is how do we continue to focus the open source community and our efforts around evangelism and sort of driving the ubiquity of the tooling. And then I think the third part of it is, as you said, we're relatively new to the commercial engagement. How do we invest in that and become kind of trusted partners to much more of the global 2000 than we are today? And I think what'd be exciting for me would be able to sort of look back and say, you know, in five years, are we at 500 of the fortune 500, uh, partnering with us. So I think that'd be very exciting. I think for me personally, I think what's been fun is getting to be in more of a position where I can help grow people internally and help sponsor projects and then, and see sort of our internal engineering folks and internal kind of product management folks kind of grow and own that from there, as opposed to necessarily me and Mitchell kind of directly building the tools in as it was in the early days. So I think that's kind of a fun transition.

AI assessment note: “in five years, are we at 500 of the fortune 500”

Q So I'm all for relieving you of the paper cut pain, but I am still intrigued because it's a tough thing to do as a founder, and you mentioned the soul-searching element. How did you look to get comfortable with this, and what do you think was key to the successful transition that really is so evident now?

A So I think, uh, you know, maybe the, the assumption there in that question might have been that, uh, that we ever managed to become comfortable. I think it was two parts. Uh, on one side, I, It's a long, you know, I would describe it as a dating process of bringing on a CEO. You spend a lot of time, you really try and understand what are the things this person values? You know, how do they think about these problems? What's their strategic approach to things? What's their lens on the market? So on one side, I think you try and remove as much uncertainty as you can around how does this person think? How does this person work? What does this person value? So I think that's one side of it, right? But there's an element of uncertainty and unknowability that you can just never overcome. And so I think that side of it really became about understanding and working with our board to say, this is you and Mitchell's company, and at the end of the day, we're going to support what you two want, and knowing that as much as it feels like it might be a completely irreversible decision, that if you feel like the board has your back and that you can manage that unknowability, that uncertainty, that it becomes more comfortable. That said, I can't say, I can't say with a straight face I was ever comfortable, right? To a degree, it's like you just take the plunge and you hope it works out. Sort of…

AI assessment note: “I can't say with a straight face I was ever comfortable, right?”

Q So I spoke to many of your investors before the show, and a commonality was that open source projects are lucky to find one hit project, yet you've had continuously produced product after product that users love. So starting with a question from the wonderful Scott Rainey at Redpointe, What's the secret to this kind of continuous successful product development?

A Well, you know, half of it is sleight of hand. You do a good job hiding the failures. I think what it really comes down to is, in some sense, for me and Mitchell, these aren't products we started off creating for the market. It was products we were creating for ourselves. And what I mean by that is we had sort of acutely felt the pain ourselves in several prior roles. So we kind of knew what are the tools that we kind of have to use? What are the problems we have to solve? And where are the pain points of it? And I think starting from there, it became really clear to us that, okay, we know here's five or six different pain points that we greatly disliked having to use the existing tooling. And so could we do better? Could we start with that problem space and build a tool that at least we enjoyed using ourselves? And that becomes kind of the starting point for these different tools. So I think that was one side of it was having kind of a deep empathy for the end user and an understanding of the problem because we were those people. We were the end user. So I think that's one side of it. I think the other side is we didn't get all of the tools right. There's at least a few that I feel like we, we sort of missed the mark. And I think we tend to be honest with ourselves when we felt that we did miss the mark quickly, try again, or, or sort of put the product on the shelf.

AI assessment note: “It was products we were creating for ourselves.”

Q actually thought about the misalignment before, so that's a super fascinating one. In terms of kind of other conversations I've had with VCs, so the majority, very commonly with VCs, assert their views, but one assertion is that it's impossible to build big infrastructure businesses today, given the commoditizing forces to open source and cloud computing. I'm really interested, how did you navigate that, and really bucked the conventional wisdom?

A Yeah, I mean, I think the way we think about it is, You're totally right that the landscape in terms of what is actually possible to monetize has changed a little bit because of the clouds. Our view is twofold. One, people will always pay for high quality work, and I think what you tend to get from cloud scale is they're not there to build the best version of a thing. They're there to build, you know, the cheap thing that goes to scale. It's sort of the Walmart effect. It's like, we need to be producing a 100,000 or a million instances of the service at massive scale, and cost is our focus. Not necessarily user experience, quality, feature set. Those aren't necessarily the focus, right? So it's quantity over quality, I think. I think the other big gap where we've sort of focused on is how do you fill in the space between the cloud? So many, many of our users are multi-cloud, whether it's traditional private data center now moving into the cloud or straddling multiple public clouds. And I think there, there's an interesting gap, which is all of these clouds are going to build infrastructure that are tailored for Their own platforms. So if I'm an end user, do I end up with five different tool chains, one per environment I'm in, or do I look for tools that help me sort of paper over that and have a common workflow across all these environments? And I think that creates an area of …

AI assessment note: “Our view is twofold. One, people will always pay for high quality work”

Q Yeah, it's an immensely difficult balance in terms of that waiting game. I do want to take a step back there from the brilliant products you've created to the company itself being HashiCorp. You only recently started generating revenue. Talk me through the thinking around this, and why now was the right time?

A I mean, I think the promise we made with our investors was, if we're going to raise our Series A at the time, you know, I don't want to focus on commercialization until we've had a chance to complete our open source vision, and I think so at the time when we were sort of fundraising, we sort of painted the picture of here's the six open source tools we want to create as part of our tool chain, and I think our investors, true to their word, really never pushed us very hard on it until we finished that tool chain, so I think That was kind of the pivot was, you know, we had that opportunity to sort of invest in the open source tools and build out the full vision, and then at some point switched gears from saying, okay, how do we go from being a really well-funded open source project to actually being a company? We have to think about, you know, what does HashiCorp the business actually mean?

AI assessment note: “I don't want to focus on commercialization until we've had a chance to complete our open source vision”

Q I mean, I love that kind of what does HashiCorp the business mean, because I speak to many investors, and they always ask me the one thing, which is, at what point do you go from building products for the community to building products that people will actually tangibly pay for?

A Yeah, and I think for us, it was very much like we have this sort of vision of the tool chain, and we want to get to having completed all the pieces. The way we viewed it is they were links in a chain, so we had to kind of complete the chain first, and then pivot our thinking into, what does this look like from a commercial perspective? You know, I think the biggest challenge for us was really figuring out, like, who our customer was. When we were building product, it was everyone. Everyone's the customer. But I think when you build a company, everyone is not the customer. Right. You either are focused on SMB, mid-market, global 2000, and I think that's a bit of a soul search.

AI assessment note: “we had to kind of complete the chain first, and then pivot our thinking”

Q Can I ask, in terms of some of the clients, you mentioned the global 2000, is there a real element of kind of customer education to the benefits and features that cloud and full cloud scale operability offers?

A For sure. I think you get the sort of the full maturity curve, right? You have your early adopters Who need no education and are telling us what you can use our tools for. And then as you start getting into things like early adopters and sort of late adopters, that group tends to need more education, both on the value of cloud, but in some sense, what's different about it? Because I think half the time people just perceive it as, well, instead of me running my data center and someone else running my data center, and that's really the wrong way to think about cloud. So I think, you know, oftentimes what we talk about is the cloud operating model, right? How do you Operate in the cloud, because it's a different process by which you operate in as compared to the private data center.

AI assessment note: “that group tends to need more education, both on the value of cloud”

Q So, Armin, uh, being a VC, I'm quite literally squirming, thinking how capital intensive this business will be in terms of the differing sales people, the differing sales profiles, the differing marketing teams, the different marketing messages that one needs for each different product. Why am I an idiot for thinking that, or am I not an idiot for thinking that?

A No, I mean, you're right that there is, you know, it's not quite that bad, right? It's not quite, you need to Fully distinct sales teams, or sales engineering, and things like that, so there is still a lot of sharing, I would say, in that sense between kind of, you know, sales resources, and marketing, and things like that. There is no doubt, though, that even internally, we almost talk about it in terms of BUs, which is like, it's almost four distinct BUs, so for sure, there is just an immense challenge of any normal company's product marketing challenge, well, ours is six times as complicated, right? Any company's elevator pitch, well, we have six elevator pitches, right? So, There is an increased challenge of it, but I think the flip side of it is, for these end users, none of these problems are indistinct, right? And what I mean by that is, if I have a problem provisioning infrastructure in the cloud, it's a 100% likelihood that I also have problems doing secret management in the cloud. And it's also a 100% likelihood that I have problems deploying my applications, right? So these problems aren't orthogonal. Because we're talking about the life cycle of delivering an application, you necessarily have to solve all these pieces.

AI assessment note: “you're right that there is, you know, it's not quite that bad”

Q touch on one kind of final element that's super intriguing about your journey, which is the element of kind of CEO-ship. You and Mitchell decided to bring on a CEO very early in the life of the business. Talk to me about that process, and what was that inflection point for you in realizing that this was something that you really wanted to do in bringing in the external CEO?

A Yeah, it was, you know, like I said, it was right around that time when we made that pivot from saying, we're just focused on open source product to now figuring out what is HashiCorp the business, and I think that's probably a six-month soul search, but once we kind of got to the end of it, what was clear to us was we wanted to be an enterprise company, right? We wanted the commercial focus to be the global 2000, and so once we said, okay, HashiCorp is an enterprise company. The question became, you know, are me and Mitchell the right people to build and lead an enterprise company? And I think if you look at our backgrounds, you know, the answer is clearly no, right? And I think the board was very supportive of us if we wanted to sort of learn and kind and grow with the company. But our view was founding a company and not having done it before, it's, you're, you're sort of learning through a thousand paper cuts. And, you know, the question was, okay, yes, we could do this and grow and learn ourselves, but What is the cost to the business of the next 10,000 paper cuts that we're going to incur? And our view was, is that worth it? Is it worth it for us, right, both personally and for the business to kind of subject ourselves to that? Or is the right answer, let's go bring in a team of folks, right, a CEO, a VP of sales that have seen this movie before. And instead of 10,000 pape…

AI assessment note: “are me and Mitchell the right people to build and lead an enterprise company?”

Q So I spoke to many of your investors before the show, and a commonality was that open source projects are lucky to find one hit project, yet you've had continuously produced product after product that users love. So starting with a question from the wonderful Scott Rainey at Redpointe, What's the secret to this kind of continuous successful product development?

A Well, you know, half of it is sleight of hand. You do a good job hiding the failures. I think what it really comes down to is, in some sense, for me and Mitchell, these aren't products we started off creating for the market. It was products we were creating for ourselves. And what I mean by that is we had sort of acutely felt the pain ourselves in several prior roles. So we kind of knew what are the tools that we kind of have to use? What are the problems we have to solve? And where are the pain points of it? And I think starting from there, it became really clear to us that, okay, we know here's five or six different pain points that we greatly disliked having to use the existing tooling. And so could we do better? Could we start with that problem space and build a tool that at least we enjoyed using ourselves? And that becomes kind of the starting point for these different tools. So I think that was one side of it was having kind of a deep empathy for the end user and an understanding of the problem because we were those people. We were the end user. So I think that's one side of it. I think the other side is we didn't get all of the tools right. There's at least a few that I feel like we, we sort of missed the mark. And I think we tend to be honest with ourselves when we felt that we did miss the mark quickly, try again, or, or sort of put the product on the shelf.

AI assessment note: “these aren't products we started off creating for the market. It was products we were creating for ourselves.”

Q actually thought about the misalignment before, so that's a super fascinating one. In terms of kind of other conversations I've had with VCs, so the majority, very commonly with VCs, assert their views, but one assertion is that it's impossible to build big infrastructure businesses today, given the commoditizing forces to open source and cloud computing. I'm really interested, how did you navigate that, and really bucked the conventional wisdom?

A Yeah, I mean, I think the way we think about it is, You're totally right that the landscape in terms of what is actually possible to monetize has changed a little bit because of the clouds. Our view is twofold. One, people will always pay for high quality work, and I think what you tend to get from cloud scale is they're not there to build the best version of a thing. They're there to build, you know, the cheap thing that goes to scale. It's sort of the Walmart effect. It's like, we need to be producing a 100,000 or a million instances of the service at massive scale, and cost is our focus. Not necessarily user experience, quality, feature set. Those aren't necessarily the focus, right? So it's quantity over quality, I think. I think the other big gap where we've sort of focused on is how do you fill in the space between the cloud? So many, many of our users are multi-cloud, whether it's traditional private data center now moving into the cloud or straddling multiple public clouds. And I think there, there's an interesting gap, which is all of these clouds are going to build infrastructure that are tailored for Their own platforms. So if I'm an end user, do I end up with five different tool chains, one per environment I'm in, or do I look for tools that help me sort of paper over that and have a common workflow across all these environments? And I think that creates an area of …

AI assessment note: “Our view is twofold. One, people will always pay for high quality work”

Q So, Armin, uh, being a VC, I'm quite literally squirming, thinking how capital intensive this business will be in terms of the differing sales people, the differing sales profiles, the differing marketing teams, the different marketing messages that one needs for each different product. Why am I an idiot for thinking that, or am I not an idiot for thinking that?

A No, I mean, you're right that there is, you know, it's not quite that bad, right? It's not quite, you need to Fully distinct sales teams, or sales engineering, and things like that, so there is still a lot of sharing, I would say, in that sense between kind of, you know, sales resources, and marketing, and things like that. There is no doubt, though, that even internally, we almost talk about it in terms of BUs, which is like, it's almost four distinct BUs, so for sure, there is just an immense challenge of any normal company's product marketing challenge, well, ours is six times as complicated, right? Any company's elevator pitch, well, we have six elevator pitches, right? So, There is an increased challenge of it, but I think the flip side of it is, for these end users, none of these problems are indistinct, right? And what I mean by that is, if I have a problem provisioning infrastructure in the cloud, it's a 100% likelihood that I also have problems doing secret management in the cloud. And it's also a 100% likelihood that I have problems deploying my applications, right? So these problems aren't orthogonal. Because we're talking about the life cycle of delivering an application, you necessarily have to solve all these pieces.

AI assessment note: “it's not quite that bad, right? It's not quite, you need to Fully distinct”

Q So I'm all for relieving you of the paper cut pain, but I am still intrigued because it's a tough thing to do as a founder, and you mentioned the soul-searching element. How did you look to get comfortable with this, and what do you think was key to the successful transition that really is so evident now?

A So I think, uh, you know, maybe the, the assumption there in that question might have been that, uh, that we ever managed to become comfortable. I think it was two parts. Uh, on one side, I, It's a long, you know, I would describe it as a dating process of bringing on a CEO. You spend a lot of time, you really try and understand what are the things this person values? You know, how do they think about these problems? What's their strategic approach to things? What's their lens on the market? So on one side, I think you try and remove as much uncertainty as you can around how does this person think? How does this person work? What does this person value? So I think that's one side of it, right? But there's an element of uncertainty and unknowability that you can just never overcome. And so I think that side of it really became about understanding and working with our board to say, this is you and Mitchell's company, and at the end of the day, we're going to support what you two want, and knowing that as much as it feels like it might be a completely irreversible decision, that if you feel like the board has your back and that you can manage that unknowability, that uncertainty, that it becomes more comfortable. That said, I can't say, I can't say with a straight face I was ever comfortable, right? To a degree, it's like you just take the plunge and you hope it works out. Sort of…

AI assessment note: “I would describe it as a dating process of bringing on a CEO.”

Q I mean, I love that kind of what does HashiCorp the business mean, because I speak to many investors, and they always ask me the one thing, which is, at what point do you go from building products for the community to building products that people will actually tangibly pay for?

A Yeah, and I think for us, it was very much like we have this sort of vision of the tool chain, and we want to get to having completed all the pieces. The way we viewed it is they were links in a chain, so we had to kind of complete the chain first, and then pivot our thinking into, what does this look like from a commercial perspective? You know, I think the biggest challenge for us was really figuring out, like, who our customer was. When we were building product, it was everyone. Everyone's the customer. But I think when you build a company, everyone is not the customer. Right. You either are focused on SMB, mid-market, global 2000, and I think that's a bit of a soul search.

AI assessment note: “we had to kind of complete the chain first, and then pivot our thinking”

Q Can I ask, in terms of some of the clients, you mentioned the global 2000, is there a real element of kind of customer education to the benefits and features that cloud and full cloud scale operability offers?

A For sure. I think you get the sort of the full maturity curve, right? You have your early adopters Who need no education and are telling us what you can use our tools for. And then as you start getting into things like early adopters and sort of late adopters, that group tends to need more education, both on the value of cloud, but in some sense, what's different about it? Because I think half the time people just perceive it as, well, instead of me running my data center and someone else running my data center, and that's really the wrong way to think about cloud. So I think, you know, oftentimes what we talk about is the cloud operating model, right? How do you Operate in the cloud, because it's a different process by which you operate in as compared to the private data center.

AI assessment note: “For sure. I think you get the sort of the full maturity curve, right?”

Q touch on one kind of final element that's super intriguing about your journey, which is the element of kind of CEO-ship. You and Mitchell decided to bring on a CEO very early in the life of the business. Talk to me about that process, and what was that inflection point for you in realizing that this was something that you really wanted to do in bringing in the external CEO?

A Yeah, it was, you know, like I said, it was right around that time when we made that pivot from saying, we're just focused on open source product to now figuring out what is HashiCorp the business, and I think that's probably a six-month soul search, but once we kind of got to the end of it, what was clear to us was we wanted to be an enterprise company, right? We wanted the commercial focus to be the global 2000, and so once we said, okay, HashiCorp is an enterprise company. The question became, you know, are me and Mitchell the right people to build and lead an enterprise company? And I think if you look at our backgrounds, you know, the answer is clearly no, right? And I think the board was very supportive of us if we wanted to sort of learn and kind and grow with the company. But our view was founding a company and not having done it before, it's, you're, you're sort of learning through a thousand paper cuts. And, you know, the question was, okay, yes, we could do this and grow and learn ourselves, but What is the cost to the business of the next 10,000 paper cuts that we're going to incur? And our view was, is that worth it? Is it worth it for us, right, both personally and for the business to kind of subject ourselves to that? Or is the right answer, let's go bring in a team of folks, right, a CEO, a VP of sales that have seen this movie before. And instead of 10,000 pape…

AI assessment note: “are me and Mitchell the right people to build and lead an enterprise company?”

Q Tell me, how long do you give it?

A It's hard. I think usually it depends, I think, on the strength of our conviction, right? I think there's been some of our tools that probably the tool we held on to the longest was Terraform. You know, I think Terraform going on a year and a half, two years was probably still in that flat line period, but we felt so strongly about it. That we weren't willing to sort of abandon it, and I think the tool for us that was sort of the two that were faster was our surf tool that I think was probably on the order of six to nine months before we said, you know what, we've missed the mark, let's try again, as well as our auto tool that was about nine months to a year before we decided to kill that one.

AI assessment note: “nine months to a year before we decided to kill that one”

Q You said that about missing the mark. It's one thing that I'm super passionate about being the balance between that vision and perseverance of the founder for the product that they've built versus maybe the stubbornness when something's clearly not working. How do you think about that? Giving it the appropriate time to hit So to speak. And how do you think about that difficult balance?

A Yeah, I think it's really, really hard, and I think if you look at any of our tools, I think most people will sort of claim that they were an overnight success, but I think the reality is when you're sort of in it, what you'll look at with all of our tools is they kind of look, they have three phases of their adoption, right? They're sort of phase one, which is, you know, if you look at download numbers or any other metric, it looks like it's on life support. It's the sort of And for many of our products, that sort of flatline period was anywhere from one to two years. And then they start going through their sort of linear growth phase, where there is some level of project maturity, there is sort of a concrete problem that we're solving, and there's sort of this growing community. And then at some point, they tick into that sort of exponential phase, right? And that's the point at which the community becomes large enough that it starts self-evangelizing. And so I think the really hard part, that sort of that period of torment is that flatline, where you're never sure We're in that flat line because every one of our tools goes through this, and this is the kind of the essential baking period, if you will. Or is it a flat line because we missed the mark?

AI assessment note: “Is it a flat line because... essential baking period... Or... because we missed the mark?”

Q One thing that's very striking to me in terms of listening to you speak is how concise you are, to be honest, and naturally, I've stalked you for the past 48 hours, and I saw in one of your tweets that you really wanted to improve your own communication. First, it's clearly worked phenomenally well, but tell me, what's worked in improving this as a skill, and what hasn't worked?

A That's a good question. You know, so I think, for me, what became clear is, as you go from sort of a two-person company, what you spend most of your time doing is typing silently. As the business grows, you know, now I find myself rarely typing, but talking frequently. So it became a question of efficiency. If this is the thing I spend most of my day doing, how can I be more efficient at it? And I think the kernel of what we're trying to do is convey an idea. That's really at the heart of communications. We're conveying ideas. And so how do you do that precisely, succinctly? I think all of that becomes important as a skill. So how do you actually practice it? I think it's A few fold. One is you just do it a lot, but try and do it consciously, right? I think just like anything else, doing something unconsciously, you don't, you never get better at it. You have to be sort of active about, could I have phrased that differently? Is there a different metaphor I could have used to convey it? I think another thing that I find very helpful is writing. So actually saying, okay, I'm going to write a blog post, or I'm going to write a white paper that tries to convey this idea. And my first pass is 10 pages. Okay, well, how do I get this down to five pages? How do I get that down to one page? And that active sort of Carving down and summarizing and rephrasing, I think, helps you build up …

AI assessment note: “I think another thing that I find very helpful is writing.”

Q You said that about missing the mark. It's one thing that I'm super passionate about being the balance between that vision and perseverance of the founder for the product that they've built versus maybe the stubbornness when something's clearly not working. How do you think about that? Giving it the appropriate time to hit So to speak. And how do you think about that difficult balance?

A Yeah, I think it's really, really hard, and I think if you look at any of our tools, I think most people will sort of claim that they were an overnight success, but I think the reality is when you're sort of in it, what you'll look at with all of our tools is they kind of look, they have three phases of their adoption, right? They're sort of phase one, which is, you know, if you look at download numbers or any other metric, it looks like it's on life support. It's the sort of And for many of our products, that sort of flatline period was anywhere from one to two years. And then they start going through their sort of linear growth phase, where there is some level of project maturity, there is sort of a concrete problem that we're solving, and there's sort of this growing community. And then at some point, they tick into that sort of exponential phase, right? And that's the point at which the community becomes large enough that it starts self-evangelizing. And so I think the really hard part, that sort of that period of torment is that flatline, where you're never sure We're in that flat line because every one of our tools goes through this, and this is the kind of the essential baking period, if you will. Or is it a flat line because we missed the mark?

AI assessment note: “that period of torment is that flatline... Or is it... we missed the mark?”

Q One thing that's very striking to me in terms of listening to you speak is how concise you are, to be honest, and naturally, I've stalked you for the past 48 hours, and I saw in one of your tweets that you really wanted to improve your own communication. First, it's clearly worked phenomenally well, but tell me, what's worked in improving this as a skill, and what hasn't worked?

A That's a good question. You know, so I think, for me, what became clear is, as you go from sort of a two-person company, what you spend most of your time doing is typing silently. As the business grows, you know, now I find myself rarely typing, but talking frequently. So it became a question of efficiency. If this is the thing I spend most of my day doing, how can I be more efficient at it? And I think the kernel of what we're trying to do is convey an idea. That's really at the heart of communications. We're conveying ideas. And so how do you do that precisely, succinctly? I think all of that becomes important as a skill. So how do you actually practice it? I think it's A few fold. One is you just do it a lot, but try and do it consciously, right? I think just like anything else, doing something unconsciously, you don't, you never get better at it. You have to be sort of active about, could I have phrased that differently? Is there a different metaphor I could have used to convey it? I think another thing that I find very helpful is writing. So actually saying, okay, I'm going to write a blog post, or I'm going to write a white paper that tries to convey this idea. And my first pass is 10 pages. Okay, well, how do I get this down to five pages? How do I get that down to one page? And that active sort of Carving down and summarizing and rephrasing, I think, helps you build up …

AI assessment note: “One is you just do it a lot, but try and do it consciously”