The Exchanges

Q Why was the retention not there? Why did people not continue to do it? Second, third, fourth video.

A In today's world, there's so many more retention mechanism built in from sort of day one, but at that time, because of our constraints, we couldn't, we didn't have enough cash to host the videos. We didn't have any social network where you could connect with other users. You couldn't even actually consume the best up smash videos inside the product. All of it was purely a creation app. Now, the flip side to that was that we could expand internationally on the lowest device phones because it was really, really fast, because we didn't have to do any of those things. But fundamentally, because of that, the retention never really worked out in the first versions of the product.

AI assessment note: “We didn't have any social network where you could connect with other users.”

Q Can I ask you a tough one, and maybe you can't share. Saying this to your investor base, respectfully, it's not what they signed up for. You know, they signed up for a massive consumer social take-home win, and this is not that. Was it difficult to get them on board?

A It was. I think the one thing that we did right at DubSmash was we were always honest with our investors. We told them whether we had it or we did it. When we got into the board meeting with Nico and, and, and Danny, we said, look, here's TikTok. Here's how much they're spending. This is a game where either we go and raise a hundred million dollar and eat a hundred million dollars. And even with that, we're unsure if we can compete at this scale. It would be one thing if one American competitor were jumping in like just Instagram. But at this point we learned it was Instagram jumping in, there was YouTube jumping in, there was Snap jumping in. And there was a slew of other startups trying to compete in the space. So we said, this is the moment that we think it's most likely and most beneficial for us to actually partner on, because everyone is thinking about what their lip sync or TikTok strategy is in 2020. Mind you, three years before, no one woke up saying, what's my lip sync strategy? There were so many moments in the tough strategy that we likely would have shut down, but the fact that we were still there in 2020, Competing, growing. We were probably the best team on the market with the most institutional knowledge to actually be able to take on someone like a TikTok, and that's why we became very valuable.

AI assessment note: “It was. I think the one thing that we did right at DubSmash”

Q How did a journalist in an article lead to the Reddit acquisition?

A So, interestingly enough, um, a journalist was able to snuff out that two acquirers were actually coming in and thinking about acquiring the company. And, you know, I denied it. As much as I possibly could. And then really the next day I realized, I really don't have any leads. And I don't know, there's, the pipeline is pretty dry right now. And so I called him back up and said, you know, I think there might be some other folks who might be sniffing around on the same story. That motivated the journalist to say, oh man, like I gotta publish something. And so an article was written there, and that was the first time that Reddit actually reached out.

AI assessment note: “an article was written there, and that was the first time that Reddit actually reached out.”

Q How do you advise founders on how to sustain morale when times are as tough as both internal and external product challenges like you had?

A So I'll, I'll give you sort of two perspectives. The first was, When things were going really well, and we were on The Tonight Show and all these other things, we didn't get too excited. We tried to temper expectations with our team, and we told them, look, we still are struggling on retention. So, we didn't believe our own hype, or we didn't believe our own bullshit. And when things got really bad, we said, look, we, we told you, like, still need to, like, work towards this, and we gotta keep motivating. Over time, though, we got to a point, so that, that's perspective one, which I would, I would say to founders, I think it's always important to live in the middle. Try not to, you know, kind of ride the waves because it's, it's unsustainable. But over time, the motivation got to a place where it was really tough and we realized we didn't have the culture to go at it again and build it with the team out in Berlin. We'd expanded to about 40 people at this point and had raised our series B. You know, the, the user base was still large, even if the retention wasn't, wasn't as strong. And so we realized we didn't have the team to do it, and so we made a really tough choice of scaling that team down, uh, from 40 to almost four people, moving the whole company to New York City, and saying, look, we're gonna rebuild the team, start fresh, and try it again.

AI assessment note: “live in the middle. Try not to, you know, kind of ride the waves”

Q What happens then? You tailor the product towards the next use case and you, like, isolate all past product iterations? Do you just cannibalize existing users? What do you do?

A Totally. We kicked out, we shut down markets. We literally shut down markets in places like India or in other areas. We completely tailor the product to this use case. We said, hey, DubSmash is now a dance challenge platform. You now can create your own account. You can actually post it all on Dub Smash. You can now create your own audio samples. And we started to see this incredible marketplace of audio producers actually uploading audio beats. Dancers starting to take those and create dance challenges, building followings, and actually starting to have meetups in offline locations as well. This was the earliest precursors, and many of those started to become very famous, actually. Dance challenges, not only on Tik Tok, but in other places, we started to see the earliest stages of like stars being born. We started to see rap songs starting to become actually viral on, on Spotify as a result of this. So this was something that we never had any idea that this was even happening, but by focusing in on it and building towards that use case, that's how we started to see kind of product market fit for the first time.

AI assessment note: “We literally shut down markets in places like India or in other areas.”

Q the dub smash story and speaking of like the competitors that we've just been discussing. TikTok at the point now where we're going back to the story where you've got product market fit with this community with the dancing as a user value prop. It's working. TikTok then starts to buy out the market and you saw growth fall. You saw downloads fall. What did you learn at this moment?

A This was incredibly unique. So never before had we ever faced a competitor Like this, who bought market share? Like we would, let's call it tacitly, maybe competed against the American competitors like snap and Instagram and others, but it was a game of retention and organic growth. That was the game. It was sort of like who had superior retention, who was able to drive organic downloads. No competitor had ever bought users at that scale. And so We, for the first time saw a competitor taking a very unique orthogonal approach. And we were a startup that had just kind of raised seven million dollars. We had the, that was the cash in the bank. They were spending that in like a week and also leveraging Facebook's ad marketplace to get hyper targeted at the demographic that they wanted to actually bring over, having the content tailored so that when they would arrive, The content was relevant to them. It was a playbook that we had never seen before. And I think that ultimately we realized we either need to raise a massive arsenal in a war chest to compete at this space, or we need to partner with someone else.

AI assessment note: “ultimately we realized we either need to raise a massive arsenal in a war chest”

Q What happens then? You tailor the product towards the next use case and you, like, isolate all past product iterations? Do you just cannibalize existing users? What do you do?

A Totally. We kicked out, we shut down markets. We literally shut down markets in places like India or in other areas. We completely tailor the product to this use case. We said, hey, DubSmash is now a dance challenge platform. You now can create your own account. You can actually post it all on Dub Smash. You can now create your own audio samples. And we started to see this incredible marketplace of audio producers actually uploading audio beats. Dancers starting to take those and create dance challenges, building followings, and actually starting to have meetups in offline locations as well. This was the earliest precursors, and many of those started to become very famous, actually. Dance challenges, not only on Tik Tok, but in other places, we started to see the earliest stages of like stars being born. We started to see rap songs starting to become actually viral on, on Spotify as a result of this. So this was something that we never had any idea that this was even happening, but by focusing in on it and building towards that use case, that's how we started to see kind of product market fit for the first time.

AI assessment note: “We literally shut down markets in places like India or in other areas.”

Q I love that. No, I, I totally get you. Can I ask you, in terms of, like, uh, the best product decision you've ever made, what do you think the best product decision you've ever made was, and what did you learn from it?

A The single best, probably, product decision was pivoting the whole company of DubSmash towards the Stance Challenge platform. I think it was daring, it was bold, it was scary, but it was the right move. And we wouldn't be where we are today had we not made that decision. And had we delayed it, we would be out of cash. So, Really, that was the best possible one. Another one is probably more recently, I would say, at Reddit, which is, you know, look, we'd pushed a new video product out there probably a little earlier than we should have, and the community let us know very vocally about it, but instead of trying to hide behind it, kind of, I went out to the company, to the community, and we owned it, and we said, look, we need to fix it. We actually even created a, a subreddit called Fix the Video Player, Literally just head on. And now the biggest detractors on Reddit are actually helping us find bugs. The product and the usage has improved a lot. And so I think sometimes when you realize even in some of the tougher situations, you can actually find light and actually make that into, into a post.

AI assessment note: “The single best, probably, product decision was pivoting the whole company of DubSmash”

Q mentioned my first seeing it at a friend's, you know, dinner and everyone just using it and loving it. It worked so well. I, I saw the, you know, some of the details. You said over ten million users in 43 days. Can I ask what were your biggest lessons on product launches, on virality, on product market fit from ten million down by users in 43 days that early?

A Yeah, you know, so first of all, I think DevSmash had a philosophy of just iterating until you found product market fit. That was the, the crux of the company, even till, you know, the acquisition is just continuously iterating. The early team that worked on multiple applications before even landing on DevSmash, so overnight successes are never really actually overnight successes. They were three failed applications that the team had worked on before landing on that first Area. And it took those years of learnings to finally get to that first kind of iteration that really resonated and, and, and work. And so, you know, the early stages was it just, it resonated at a, at a level that I think customers really couldn't articulate, but would just continuously share. The other piece of it was there were so many constraints on the company at the time. There was very minimal cash. And so what that meant was, We couldn't do things like host video, so we did a bunch of lightweight hacks, like the whole product was a creator app. You could just send a video, and because we couldn't host video because it was too expensive, we just sent it to WhatsApp, Facebook Messenger, iMessage, and that made it the product really lightweight. That also made inherently a whole viral loop. We had every video with a watermark on the bottom right that said DubSmash.com. We were probably one of the first th…

AI assessment note: “We had every video with a watermark on the bottom right that said DubSmash.com.”

Q How do you advise founders on how to sustain morale when times are as tough as both internal and external product challenges like you had?

A So I'll, I'll give you sort of two perspectives. The first was, When things were going really well, and we were on The Tonight Show and all these other things, we didn't get too excited. We tried to temper expectations with our team, and we told them, look, we still are struggling on retention. So, we didn't believe our own hype, or we didn't believe our own bullshit. And when things got really bad, we said, look, we, we told you, like, still need to, like, work towards this, and we gotta keep motivating. Over time, though, we got to a point, so that, that's perspective one, which I would, I would say to founders, I think it's always important to live in the middle. Try not to, you know, kind of ride the waves because it's, it's unsustainable. But over time, the motivation got to a place where it was really tough and we realized we didn't have the culture to go at it again and build it with the team out in Berlin. We'd expanded to about 40 people at this point and had raised our series B. You know, the, the user base was still large, even if the retention wasn't, wasn't as strong. And so we realized we didn't have the team to do it, and so we made a really tough choice of scaling that team down, uh, from 40 to almost four people, moving the whole company to New York City, and saying, look, we're gonna rebuild the team, start fresh, and try it again.

AI assessment note: “I would say to founders, I think it's always important to live in the middle.”

Q I'm sorry, what was that retentive use case? It was dancing?

A So what they would do was users would find a sound, a Dubsmash had the ability you can upload an audio sound. They would upload their own version of an audio sound of, let's call it a very specific dance kind of beat or a sped up beat or a dance challenge. So not Arnold Schwarzenegger, I'll be back, but a very specific, like produced, um, kind of like UGC audio sample. Users then would go and dance to that and create a challenge. They would post it on the, on Instagram and use a very cryptic hashtag to be able to actually gather a community around the hashtag and said, go to, and give instructions, go to Dubsmash, find this sound, create a dance video, post it on Instagram, and then be able to see who hits the challenge the best. It was the smallest starting in Atlanta, Georgia. A few users started to use it in this way, and it started to really locally grow. And we saw that behavior really early on and said, there's something here of a seed of an idea. And mind you, we had millions of still kind of installations and users and international markets, but that seed caused us to say, let's actually skate towards that. Let's build a product around that use case. And, and that's kind of how we iterated on the next version of DubSmash.

AI assessment note: “Users then would go and dance to that and create a challenge.”

Q Can I ask you, it was a very specific use case in quite specific communities. Did you have any big product lessons from finding product market fit in that way with this community and this use case?

A We did. I mean, I think ultimately this community was the most savvy community I'd ever encountered. And it w it goes back to the motivations question. They were motivated because they wanted to become an entertainer. And it started with many of them beginning the process of trying to actually earn revenue at a really early stage. So what we saw was a user with 10,000 followers would say, Hey, I'll promote your account. Just hit me up on cash app for 50 bucks and I'll promote your account. But then we would see that behavior mimicked. So a user with 50 followers would say, Pay me five dollars and I'll promote your account. The mimicry of actually influencing to customers was translating down whether you had 10,000 followers or 50 followers. They were so motivated by really being that entertainer and earning cash that it was really we wanted to build tools to make that kind of, ah, really possible for them.

AI assessment note: “They were so motivated by really being that entertainer and earning cash that it was”

Q it, that you called it not working and you made the decision to move back, resize the team, go back to the drawing board. The hard thing is not many people call it. And so how do you know when to stick with a product and just stick to it? It's going to come versus it's not going to come and we need to reconsider. How do you do that?

A So for zero to one products, you're actually looking for the earliest seeds of validation. And a lot of people talk about in product management, you know, what you're really looking for is kind of what users say and, you know, what users are, are kind of how they're using it. And it's important to look at what users do, but what you're really trying to see is not what users are telling you, but really trying to gravitate to what they are doing and in, in a very unique way, how they're leveraging the product in ways that you probably never even imagined. So I'll give you a very tactical example of what happened with us at Dubsmesh. We were building this lip syncing product. This thing was kind of working in various international markets. We were randomly trending in India. We then were trying to skate towards building kind of a quotes database. We had all these different ideas, but it was really the sort of Eureka moment happened one day, just sitting on a couch, browsing on Instagram and seeing one video. And the singular video was A young black teenager, not using Dubsmash as a lip sync product, but using it as a dance product. Using a very cryptic hashtag, posting it on an explore page. And that single video took us down a rabbit hole where we saw, Hey, there was a small community to using it in this way. And we realized there was really strong retention with this very, very …

AI assessment note: “for zero to one products, you're actually looking for the earliest seeds of validation.”

Q the dub smash story and speaking of like the competitors that we've just been discussing. TikTok at the point now where we're going back to the story where you've got product market fit with this community with the dancing as a user value prop. It's working. TikTok then starts to buy out the market and you saw growth fall. You saw downloads fall. What did you learn at this moment?

A This was incredibly unique. So never before had we ever faced a competitor Like this, who bought market share? Like we would, let's call it tacitly, maybe competed against the American competitors like snap and Instagram and others, but it was a game of retention and organic growth. That was the game. It was sort of like who had superior retention, who was able to drive organic downloads. No competitor had ever bought users at that scale. And so We, for the first time saw a competitor taking a very unique orthogonal approach. And we were a startup that had just kind of raised seven million dollars. We had the, that was the cash in the bank. They were spending that in like a week and also leveraging Facebook's ad marketplace to get hyper targeted at the demographic that they wanted to actually bring over, having the content tailored so that when they would arrive, The content was relevant to them. It was a playbook that we had never seen before. And I think that ultimately we realized we either need to raise a massive arsenal in a war chest to compete at this space, or we need to partner with someone else.

AI assessment note: “ultimately we realized we either need to raise a massive arsenal in a war chest”

Q All of this requires a lot of mental stability. You're going in, you're getting acquirer one, you're getting acquirer two, both fall through. It's acquirer three that when it comes through. You've said before your mindset is the most important aspect. Talk to me about this. What do you think about the right and most important aspect being the mindset? What did you do right? What did you do wrong?

A I view this in kind of two ways. There's a mindset of being an entrepreneur. And there's actually the mindset now as an acquired founder and now an executive at a company, there's a, there's a bit of a different mindset as well. Mindset as an entrepreneur, number one, a lot of people talk about focus. We were always really focused on the key problems and making sure that we're fine, trying to find product market fit. That was always a North star. What that meant was it was very clarifying. We focused on making sure to conserve cash. We got rid of the fancy office. We Reduce payroll down. We did everything for the purposes of trying to make sure we, we had enough money in the bank to keep going. The second was intellectual honesty. We told each other when things were going super well, we said, eh, we don't actually have it. When things weren't going great, we said, we knew it wasn't happening. We just got to keep working. Even with the iterations of DubSmash that started to see those 30% D-thirty retention numbers, we said, we knew we can still do better. That intellectual honesty, I think, is so critical for founders because it actually clarifies the decision making. The third was, and I think the other key one is stamina. At the end of the day, we stuck around, and we persevered, because we were in the space long enough. By 2017, 20 18, we could have shut down. We had probably…

AI assessment note: “Mindset as an entrepreneur, number one, a lot of people talk about focus.”

Q I'm sorry, what was that retentive use case? It was dancing?

A So what they would do was users would find a sound, a Dubsmash had the ability you can upload an audio sound. They would upload their own version of an audio sound of, let's call it a very specific dance kind of beat or a sped up beat or a dance challenge. So not Arnold Schwarzenegger, I'll be back, but a very specific, like produced, um, kind of like UGC audio sample. Users then would go and dance to that and create a challenge. They would post it on the, on Instagram and use a very cryptic hashtag to be able to actually gather a community around the hashtag and said, go to, and give instructions, go to Dubsmash, find this sound, create a dance video, post it on Instagram, and then be able to see who hits the challenge the best. It was the smallest starting in Atlanta, Georgia. A few users started to use it in this way, and it started to really locally grow. And we saw that behavior really early on and said, there's something here of a seed of an idea. And mind you, we had millions of still kind of installations and users and international markets, but that seed caused us to say, let's actually skate towards that. Let's build a product around that use case. And, and that's kind of how we iterated on the next version of DubSmash.

AI assessment note: “go to Dubsmash, find this sound, create a dance video”

Q I love Hans Zimmer. That's so funny to hear. Start with no is also amazing. Final one for you. What's the most recent product strategy that you've been most impressed by?

A This one, this one will be probably a little bit of a zag. United Airlines. They're, most people's expectations when they fly is their expectations are sky high and their tolerance for mistakes are incredibly low. And actually, mistakes always happen in the airline space. What United has done over the past few years has actually really been at the forefront of any new iOS feature with kind of their live action bar, um, notifications, messaging, and actually has built a really robust kind of Tech stack to actually facilitate that. I recently went through this because I had a bag lost at United, and I tried to go through their normal customer care of calling them, and it was a nightmare. But then I used their text messaging service and got the bag back within 24 hours, and color me impressed.

AI assessment note: “What United has done over the past few years has actually really been at the forefront”

Q We're building this kind of very, very first V-One of Dubsmash. This involves kind of two core elements that I think you're world-class at, because I heard it, by the way, from Danny and from Nico in particular. User understanding was number one. How do you think about what great user understanding is, and what questions do you ask?

A Yeah, it's a great question. It's taking the combination of your own intuition and marrying that with your understanding of human motivations in the real world to actually build a product. So every day you and I make thousands of observations about people, their judgments, their reactions. Over time, you start to get a layer deeper into the understanding of why these humans act a certain way, and that drives you towards understanding their motivations. You start to synthesize those motivations into patterns and behavior. And with that, you actually create sort of the why a product should be built. You don't start with, let me just design it in this way. You start with, what is it that this will do to motivate other users, uh, motivate them to actually use the product. And this is the reason why consumer internet is so exciting is because you take that, you then put it out there to the world and validate your hypothesis. And over time, You start to get better and better at it. And for me, the greater the scale, the more exciting it is. You know, hence the reason why I love working at Reddit now is that the scale is massive. At Dubsmash, it was a little smaller, but it was still quite big. And so every day is just about making sure to refine that. In terms of your, your answer around the questions I ask, I look a lot for motivation. Um, and with Dubsmash, we worked a lot with cre…

AI assessment note: “taking the combination of your own intuition and marrying that with your understanding of human motivations”

Q Why was the retention not there? Why did people not continue to do it? Second, third, fourth video.

A In today's world, there's so many more retention mechanism built in from sort of day one, but at that time, because of our constraints, we couldn't, we didn't have enough cash to host the videos. We didn't have any social network where you could connect with other users. You couldn't even actually consume the best up smash videos inside the product. All of it was purely a creation app. Now, the flip side to that was that we could expand internationally on the lowest device phones because it was really, really fast, because we didn't have to do any of those things. But fundamentally, because of that, the retention never really worked out in the first versions of the product.

AI assessment note: “because of our constraints, we couldn't, we didn't have enough cash to host the videos”

Q Can I ask you, it was a very specific use case in quite specific communities. Did you have any big product lessons from finding product market fit in that way with this community and this use case?

A We did. I mean, I think ultimately this community was the most savvy community I'd ever encountered. And it w it goes back to the motivations question. They were motivated because they wanted to become an entertainer. And it started with many of them beginning the process of trying to actually earn revenue at a really early stage. So what we saw was a user with 10,000 followers would say, Hey, I'll promote your account. Just hit me up on cash app for 50 bucks and I'll promote your account. But then we would see that behavior mimicked. So a user with 50 followers would say, Pay me five dollars and I'll promote your account. The mimicry of actually influencing to customers was translating down whether you had 10,000 followers or 50 followers. They were so motivated by really being that entertainer and earning cash that it was really we wanted to build tools to make that kind of, ah, really possible for them.

AI assessment note: “We did. I mean, I think ultimately this community was the most savvy”

Q Can I ask you a tough one, and maybe you can't share. Saying this to your investor base, respectfully, it's not what they signed up for. You know, they signed up for a massive consumer social take-home win, and this is not that. Was it difficult to get them on board?

A It was. I think the one thing that we did right at DubSmash was we were always honest with our investors. We told them whether we had it or we did it. When we got into the board meeting with Nico and, and, and Danny, we said, look, here's TikTok. Here's how much they're spending. This is a game where either we go and raise a hundred million dollar and eat a hundred million dollars. And even with that, we're unsure if we can compete at this scale. It would be one thing if one American competitor were jumping in like just Instagram. But at this point we learned it was Instagram jumping in, there was YouTube jumping in, there was Snap jumping in. And there was a slew of other startups trying to compete in the space. So we said, this is the moment that we think it's most likely and most beneficial for us to actually partner on, because everyone is thinking about what their lip sync or TikTok strategy is in 2020. Mind you, three years before, no one woke up saying, what's my lip sync strategy? There were so many moments in the tough strategy that we likely would have shut down, but the fact that we were still there in 2020, Competing, growing. We were probably the best team on the market with the most institutional knowledge to actually be able to take on someone like a TikTok, and that's why we became very valuable.

AI assessment note: “It was. I think the one thing that we did right at DubSmash was”

Q All of this requires a lot of mental stability. You're going in, you're getting acquirer one, you're getting acquirer two, both fall through. It's acquirer three that when it comes through. You've said before your mindset is the most important aspect. Talk to me about this. What do you think about the right and most important aspect being the mindset? What did you do right? What did you do wrong?

A I view this in kind of two ways. There's a mindset of being an entrepreneur. And there's actually the mindset now as an acquired founder and now an executive at a company, there's a, there's a bit of a different mindset as well. Mindset as an entrepreneur, number one, a lot of people talk about focus. We were always really focused on the key problems and making sure that we're fine, trying to find product market fit. That was always a North star. What that meant was it was very clarifying. We focused on making sure to conserve cash. We got rid of the fancy office. We Reduce payroll down. We did everything for the purposes of trying to make sure we, we had enough money in the bank to keep going. The second was intellectual honesty. We told each other when things were going super well, we said, eh, we don't actually have it. When things weren't going great, we said, we knew it wasn't happening. We just got to keep working. Even with the iterations of DubSmash that started to see those 30% D-thirty retention numbers, we said, we knew we can still do better. That intellectual honesty, I think, is so critical for founders because it actually clarifies the decision making. The third was, and I think the other key one is stamina. At the end of the day, we stuck around, and we persevered, because we were in the space long enough. By 2017, 20 18, we could have shut down. We had probably…

AI assessment note: “Mindset as an entrepreneur, number one, a lot of people talk about focus.”

Q it's sad that some of our brightest young talent, technical and non-technical, goes into big companies like your PayPal's and works on the color of a button. They could do more. Like, do you agree with that? And what advice would you have for young talent coming out of universities or in the very early stages of their career, given your unusual start in product management and in an incumbent?

A So first of all, uh, just to clarify, uh, we designed and actually pushed out the button, you know, to for PayPal, but I hear this feedback often where it's when you're working on incremental details at a very large company, is it truly valuable? I think the frameworks that you learn at some of these companies are incredibly valuable, but I will say that I found a lot of joy in actually marrying the large company experience with the true startup experience in which you are constantly iterating, pushing product out, learning, repeating, failing, and then actually refining sort of your taste as you move forward. And I think my, for young talent, I would always encourage both sides, you know, Make sure to go into a large company, but also make sure to dive into startups and, and really get the reps in.

AI assessment note: “for young talent, I would always encourage both sides”

Q What didn't you nail? The user value, the user proposition, the messaging, the product, The onboarding. What was that?

A We didn't nail the user motivation. We didn't get users to spend, to shift their time or spend their time daily using the product. And that's, and that's what every consumer product is aiming to try and do. You know, packaged all up, really what you're trying to do is get users to think about your product, use your product on a cadence that is daily. And we never got that. Really with this first version of Dovesmash. And so, as I mentioned before, the framework I use is, you know, good products make it to your home screen. Great products make it into your mind. We just didn't get into their mind. Look, that's okay. At the end of the day, consumer internet is the hardest space to really play in. The batting averages are so low. You gotta keep trying though. And that's the key thing is that we never stopped trying. We said, look, we know we don't have it now, but we have this optimistic view that The next iteration was going to get it, and it was just around the corner, and so we kept working on that.

AI assessment note: “We didn't nail the user motivation.”

Q I totally agree with you. Can I ask, I know you went through a couple of, how do we say, at-bats, so to speak, with different acquirers. Can you just tell me about the process with a couple of different acquirers and what you learned from those different hits and misses?

A You know, openly we went through sort of almost two to three failed processes until we found a successful process with, with, with Reddit. What I learned through the process is a couple of things. There's some obvious ones. Look, with technology platform companies, you have to really connect with the product leader or the CEO. It's not really ever with the corp dev team or the business development team. I think most people know that. The second is, look, it's gut wrenching. It can be very isolating. You internalize this up and down, but you've got to stay calm and collected and not get overly emotional in the process. The third is really, look, term sheets and LOIs, even from some of the largest companies in the world, Mean very little. I think oftentimes entrepreneurs can get really excited by it, but generating those is not very difficult for a large company to do. They may say, Hey, we rarely do this and we rarely give something like this out. But in actuality, the true process happens after the term sheet and the LOI it's in the diligence. And the difficulty is you may have convinced someone, one person in the organization that this is a good idea. But once the diligence starts, you have many people around the table who are trying to say, this is why it's a bad idea. That is a really tough process to go through because you have to do a lot of convincing to so many stakehold…

AI assessment note: “What I learned through the process is a couple of things.”

Q and it was called Dubsmash. I can't remember how old I was, but obviously I downloaded it instead of everyone else, and it was just insanely cool when it came out. And you had many ups and downs, and so we're going to go through them today, and I want to start at the beginning. Moving to Berlin with your wife and starting the DubSmash journey, how did that go?

A Just as background, um, I'm originally from the Bay Area. Um, my wife and I met in high school, and, uh, when we were living in San Francisco, we got married in 2012. We sort of hit a wall in 2014. Openly, I, I, you know, I would walk over to my coffee shop on a Saturday morning, and someone would be like, hey, do you want to You know, test out my app and I'm like, I work in the industry, man. I don't think this is really, I'm, I'm not a good user for this. And, uh, I think we realized we needed something different, kind of felt like there was something missing there. And so we decided to just move to Berlin really for entirely personal reasons. We didn't know anyone. We didn't have any jobs. We left our jobs. And so we moved out there almost like for a year sabbatical and really actually after working in startups, I learned a few things. Most notably the things that I was not very good at. And so I said, let's spend a year trying to focus on things that I can get better at. I took a bunch of courses on Coursera. I learned how to live kind of, you know, this unique European lifestyle, which was incredible. Uh, but this sabbatical openly failed after about three months. I think we both realized I, we kind of need to do something. We need to work. And so I just started kind of like you, Ray, like I just started reaching out to people. And I'm like, Hey, I'm from the Silicon Valle…

AI assessment note: “we decided to just move to Berlin really for entirely personal reasons.”

Q Do you agree with me? Why do you agree with me?

A It's a massive emotional rollercoaster, and the ups and downs of an M&A process are not for the faint of heart. I was sort of leading the charge on, on our M&A process, and even what I would communicate to the co-founders would be a little bit watered down. You need them so that you can all continue to motivate each other, and they're critical pieces for all of us working together on this, but still, it is, you know, you would be up at night, Hoping that an email was read. You would be sending a text and not getting a respond and wondering in your mind, like, what's going on? Is something wrong? All of your sort of, like, anxieties are elevated in this process, and so that's why I start with, it's not for the faint of heart, and it requires a tremendous amount of just sort of focus to actually really get it over the line. I think it's really unfair to actually put your team through something like this.

AI assessment note: “It's a massive emotional rollercoaster, and the ups and downs of an M&A process”

Q With the benefit of hindsight, is there anything you would have done differently with the acquisition process?

A It's hard for me to say because I think about it in a very binary way. Ultimately we were successful and the entire team moved over to Reddit. The entire team was working on Dub Smash. All of us were really happy. Reddit's an incredible culture. And so it was better than I could have ever imagined quite openly. And I think things happen for a reason. And so with hindsight, if anything, I wish I had found Reddit earlier in the process. We went through a lot of pain in the early stages with maybe other partners, and I think that that was something that I, I wish would have happened sooner. Probably would have, you know, saved me a couple sleepless nights.

AI assessment note: “if anything, I wish I had found Reddit earlier in the process.”

Q We're building this kind of very, very first V-One of Dubsmash. This involves kind of two core elements that I think you're world-class at, because I heard it, by the way, from Danny and from Nico in particular. User understanding was number one. How do you think about what great user understanding is, and what questions do you ask?

A Yeah, it's a great question. It's taking the combination of your own intuition and marrying that with your understanding of human motivations in the real world to actually build a product. So every day you and I make thousands of observations about people, their judgments, their reactions. Over time, you start to get a layer deeper into the understanding of why these humans act a certain way, and that drives you towards understanding their motivations. You start to synthesize those motivations into patterns and behavior. And with that, you actually create sort of the why a product should be built. You don't start with, let me just design it in this way. You start with, what is it that this will do to motivate other users, uh, motivate them to actually use the product. And this is the reason why consumer internet is so exciting is because you take that, you then put it out there to the world and validate your hypothesis. And over time, You start to get better and better at it. And for me, the greater the scale, the more exciting it is. You know, hence the reason why I love working at Reddit now is that the scale is massive. At Dubsmash, it was a little smaller, but it was still quite big. And so every day is just about making sure to refine that. In terms of your, your answer around the questions I ask, I look a lot for motivation. Um, and with Dubsmash, we worked a lot with cre…

AI assessment note: “In terms of your, your answer around the questions I ask, I look a lot”

Q For listeners, why is the smile such a beautiful graph for product people?

A I think it's validation at the end of the day that all of this hard work, sweat and tears, that would be the thing that would motivate me is to say we have finally created a retentive product. We're finally actually resonating with customers. And it's really hard because everyone says you want to see the hockey stick growth. We saw it in the reverse direction for a very long time. And, and that was challenging. And it was really hard in those moments when you see those numbers going down to get motivated. But by being relentless, continue to focus on trying to find that product market fit, and finally seeing the validation that it was working, it was a feeling like unlike anything else.

AI assessment note: “validation at the end of the day... we have finally created a retentive product.”