The Exchanges

Q of investors who, who do listen to this podcast and you did want to buy a roll up of legal tech or legal services. And you were trying to figure out how can I get from not knowing a lot about this space to knowing everything about this customer in a short amount of time, like what frameworks or You know, would, or advice would you give to that person?

A The more I think about it, the more I feel like legal is like one of the worst verticals to try this strategy on. So we should really, we should pick a different example because it's like there's special rules that govern the behavior of law firms. I think actually like some of the legal, full stack legal startups, maybe I would have a better shot than a roll up. But anyway, but to answer your question, people always looking for a framework. They're always looking for like something complicated here. It's not complicated. What you have to do is spend your time talking to customers. And yes, if you don't know how to do a customer discovery interview, like go back and reread the Lean Startup or go by reread, you know, if you want an even more classic book, The Four Steps to the Epiphany, the original customer development book, or if you really don't know how to do it, could you spend one hour reading a book and nine hours talking to customers? That would be more profitable. And most people are too scared to do this. I'm introverted. I don't really like talking to customers either. I find a little bit, you know, I'm getting terminated. It makes me nervous, but like, you gotta get over it. And the key I think to get over people's reluctance or nervousness about it is like, don't Don't be like, well, I gotta spend 10 hours today talking to customers all day long, and I gotta lock th…

AI assessment note: “What you have to do is spend your time talking to customers.”

Q Put it out there. Every website should have a, what we stand for tab as one of their main navigation tabs. Right? They have an about us, they have a contact us, they have their products, how it works, but what we stand for, I think, is the missing tab on so many websites.

A People in that tab need to say, not just here's what I intend to do, but here are the externally verifiable commitments that I have made that mean you can trust me. And I think that's like the structural side of this. We have too many manifestos about purpose-driven companies. The ESG movement has been a total failure. You know, from my perspective, because Philip Morris has great ESG scores. Something's gone really wrong here. So before we deal with regulation and before we deal with the ESG movement and investors, and we like, we as innovators, we as company builders, we got to get our own house in order. And the first question is, what do we actually want to accomplish with this company? And I literally had a founder, I was helping set a company who was watching the open AI debacle. And then he's like, just what are the best practices for like, how do you set up a company? So it will remain true to your original intention that everyone's like, I don't know. Or like, Try this one weird trick. Maybe that will work. Or just like, oh, there's nothing you can do about it. And it's like, no, that's like saying like, yeah, you know, I, I tried to build a boat and like, I got 82% of the planks were air, you know, watertight. So, but then it sank. So I guess making watertight planks is not the key to making a boat. I think we need a new playbook, a whole new approach to building, you…

AI assessment note: “People in that tab need to say, not just here's what I intend to do”

Q I want to talk about another thing that's on your mind here on your list. We need new companies, new models, and new investors who can take the learnings of the last cycle and make sure we don't repeat the same mistakes. What do you mean by that?

A I think there is a groundswell for something new. Let's go back to don't be evil. Everyone in the industry remembers Google's don't be evil motto. It was like such an idealistic and like hacker-ish way of talking about what does it mean to become a big company. And everyone, although people still admire Google, like most people will admit to some level of disappointment about how it turned out compared to what we thought it was going to be. And I, to me, this was perfectly encapsulated by, uh, um, an ex-Googler I was talking to the other day. And I asked him, he was talking about how he had been there for a number of years and how disillusioned he was by what had happened to the culture. And I said, okay, tell me this. What do you believe is the probability that Google will file its next quarterly report on time? And he looked at me like, obviously a hundred percent. I was like, Literally 100%. He's like, oh, they, there's nothing on earth that could stop it. I'm like, what do you view as the probability that Google might in the future kill somebody for money? And he was like, oh, come on, man. That's not fair. They probably wouldn't do that. It's like probably. It's like, yeah, you know, I was like, a hundred percent sure they wouldn't do it. He's like, well, a hundred, but no, I can't, who can say that? Like, he's like, well, you know, what if their social network was involve…

AI assessment note: “Let's go back to don't be evil. Everyone in the industry remembers Google's”

Q And we're seeing a lot of, you know, people call them rapper AI startups in the space, like indie hackers who will take a, a use case on top of ChatGPT or another LLM and just build a purpose-built ChatGPT for lawyers, ChatGPTs for something else. Do you think that there's longevity in those businesses?

A We haven't had a bonafide platform war in tech in a little while. Because, uh, Android iOS was not really the real thing. I, I kind of feel like Google, their heart was never really into it, so it wasn't like Apple, Microsoft, or Coke, Pepsi, you know, uh, Intel versus over the 68,000 Motorola processor. Like, it's just, it's been a while since, like, really mega tech titans went to war with each other. Many people in this era have forgotten the old parable of picking up dimes in front of the steamroller, which I believe this ism applied to platform wars originally dates to Jean-Louis Gasset, Of BOS and Apple fame, but I've actually never had the chance to ask him. That's where I learned it from. The parable of the, of the, of picking up dimes from the steamroller is that when you have a platform war, the platforms are the steamrollers. So you're building a new platform that many, many businesses are going to be built upon. Think about like Microsoft Windows or the Intel processor. In such a situation, the platform has this tremendous logic and momentum behind it. I mean, it really is a steamroller. It flattens anything in its path, you know, open AI or Anthropics are very fast moving companies, very impressive actually, um, considering. But they're still behemoths, and they're still dealing with multi-billion dollar problems. So although the steamroller has the power to flatte…

AI assessment note: “You see a dime in the path of the steamroller... the dime is completely yours”

Q Last one, it's AI accountability bots. It's this thesis that, you know, people are generally bad at accomplishing their goals, but if they have someone who holds them accountable, they're more likely to do it. So for example, would people be willing to pay for accountability around working out?

A Yeah. Oh yeah, definitely. This kind of thing is going to be a huge category as the AI gets better. Um, but there's problems. And I mean, talk about ethics and responsibility. I'll just give you a story. I was talking to a founder I can't say too much or it'll be obvious what company I'm talking about. So I'll be a little bit careful, but they had a, a really, it was like a hot AI product. It was a little while ago now. Um, and one of their investors introduced it to me as like one of the fastest growing companies in their portfolio. They had an incredible number of users, a lot of whom were teenagers who were interacting with this thing. And it was just really cool. So I'm talking to the founder and I'm talking about AI ethics and stuff like, you know, the usual stuff that I talk to people. What's your governance? How's your strategy? And while I'm talking to him, I have my phone out. I'm like, I'll just download the app and I'll just try it. I'm curious. What it's like. And literally while I'm on the phone with him, the AI starts sexually assaulting me. I'm not being subtle here. Like it was full on rape language. It was like, it was after me. And I was, I don't know what I had done to set it all. It just like, from my point of view, it was like totally out of the blue, very inappropriate language. I'm on the phone with the CEO. I'm like, dude, um, this thing's trying to rape…

AI assessment note: “This kind of thing is going to be a huge category... but there's problems.”