Omar Haroun: “Outsized Impact is Incredibly Rewarding”

0:00Each of us has some kind of unique strength. All of us have a purpose and that purpose actually ties to what's our unique function or functional capability. If you have that incredible capability and the market is ready for this, and if you were to do it, it actually would have a major impact. Then it actually feels almost like a moral failing to not do it. Big exits come with big questions. Who am I? Why am I here? What gives my life meaning, purpose, fulfillment? Many of us try to outrun those questions only to find ourselves years later living lives that feel empty, unfulfilled. But not my friend Omar Harun.

0:48I really do believe there's a relatively small percentage of people who actually are responsible for having an outsized influence on the world. And so if you are one of those people and you actually have that gift or that ability, then I think we've settled in general as a society. When you have that opportunity as a post-exit founder to really actually do something that could have a major impact, solve a real problem. What I found is that's incredibly rewarding. Omar sold his company TextIQ in a nine-digit exit four years ago. And now Omar is building again. His new company, Udio, is augmented AI for chief legal offices.

1:32Omar is building on what he knows and understands, but faster, cheaper. Udio raised$100 million in Series A, and Omar is all in. And today we explore why. Why after big financial success he started again, and how. How he's balancing his family life, friendships, fitness, and his passion for surfing.

2:01My friends, we are here to help each other make better decisions post-exit with our time, energy, wealth, and relationships. If what we share here resonates, let us know by subscribing or following. It helps us bring on incredible guests and reach more exited founders who need these conversations. Do me a favor, hit that subscribe or follow button. We're in this together. Hi Omar, thank you so much for joining me today. I am really, really excited about this conversation, as you know. A lot to dig into. Excited to be here. Do you remember our first meeting? How we were at this event and we ended up in one kayak together, just you and me.

2:56And I remember like literally minutes into the trip, you started telling me about this amazing AI company you had just sold in the legal space. And I was just sitting there thinking, oh, my God, here I am, someone completely obsessed about the whole post-exit journey, a former M &A attorney and a tech founder in this boat with you of all people. So I thought it was a sign from God. And I really think it was. Because since then, you've been such an inspiration and source of wisdom. And I'm just really grateful for that moment that brought us together. Yeah, I'm a big believer in serendipity. Definitely felt like that.

3:41Exactly. Me too. Exactly. So one of the things that I found super impressive about our conversation back then is the fact that you had already sold an AI company and a massive and complicated one before it was even a thing. Can we start with that? Tell me more about it. Yeah. So I never really, I think on the one hand, what lawyers do is really analyze language and generate language. And so language models have obviously been around for a while. And I think it felt like a very good fit with what they could do. At the same time, lawyers are very risk averse people and law firms bill by the hour.

4:33So even if there is technology that can significantly reduce the hours, law firms in particular, never really from first principles felt like they were kind of the right customer. So we actually were one of the first companies, my last company, and even this one to sell to the general counsel and the in-house legal team who has the same incentives. And ultimately my last company was very much reducing risk, not even focusing on efficiency by using AI to find very sensitive communications in the context of litigation typically. So if a company is going through lawsuit. They're often required to hand over millions of emails and documents.

5:15And RAI would, in like five minutes, discover that the CEO is having an affair or something was going on that they really wanted to know about. And that was at risk of being missed before it went into the public record. And so it was a pure risk reduction play. But for a risk averse buyer, once they saw what it could do, they had to have it. And then we kind of had a good exit in 2021. How did you manage to persuade some of the largest companies in the world to actually trust you with their data? Because for me, that's just mind blowing, especially given my background in law and knowing how risk averse and protective of data lawyers are and have to be.

5:51Yeah, definitely. I think a lot of it is, I mean, obviously, from a privacy security standpoint, there's a lot you have to do, which is at the extreme end of what most startups would never do. But even after that, I actually firmly believe that trust is actually a human to human experience. and part of why with that company and even this one, I'm living on a plane and traveling so much is you really just need to build that trust. Once you have obviously broken through and you have a set of customers who have now seen that using this technology was obviously not only safe and secure, but actually a career enhancing move for the individuals who brought it in, then it starts to shift from being risky to being an opportunity.

6:37But you're absolutely right. The bar is probably couldn't be higher than it is legal. Exactly, because today many more companies appreciate the need for AI. But back then also, it's really impressive that you managed to persuade clients to trust you. And then, of course, on that amazing kayak trip, before it was over, you invited me to come and stay at your family house with my husband, which I later did. And then we had another mind-blowing conversation when you shared your vision for the future with me. And you were saying, it's great to enjoy life, to enjoy my family, but I really have this vision and I have to go after it.

7:22And the vision that you described to me at the time was that you wanted legal services to be accessible for everyone and AI would help. And there was so much passion and spark in your eyes and so much conviction. And I was like, oh, my God, it's actually happening. He is going to do that. So can you take me through that moment when you just had this brilliant idea to what is happening today and how you ideated, how you had that certainty? Because it's really impressive where you are at the moment. Thank you. Yeah. Yeah. So after selling my last company, I, I think we'll probably talk a lot more about this, but, but, but I went through what I was very surprised by, but you're, you're obviously creating a podcast to show it's not, it's not that uncommon, but this very, very sort of unusual experience where I felt the exact opposite that I expected to feel.

8:25And then that set me off on this journey. And as I was reflecting, I think a big part of it was even though we had had a good financial outcome, we didn't really do anything to actually change the legal industry. And legal, I would argue, is competing with healthcare for maybe the one industry where these very, very complex and perverse economic incentives and this whole ecosystem that's really built on top of these incentives being in the wrong way are actually preventing consumers from, I mean, 90 % of people who need a lawyer can't afford one. Most Americans are a single legal event away from bankruptcy.

9:08And then you look at businesses and companies like even my current company, I think we spent $75 ,000 on our series A legal documents, right? And anyone who's in the AI world knows that actually most of this work, you can now, whether you can automate 80 % of it, 60 % of it. I mean, we could debate what the percentage is, but it's very, very high. And so the technology is there. We proved that with my last company, even before ChatGPT. Now it's obviously even more accessible than it ever was. And yet there's like almost no adoption of actual AI. And so, yeah, when I really reflected and we can get a lot more into the details behind that, but it felt like whatever I did next, I really wanted it to be something that had a deep mission attached to it and where it wasn't just about building a business.

9:59It was actually about changing a whole industry and really leaving that kind of legacy on the world, which was very, very motivating. Yeah. And that's exactly what I saw back then in you. You were literally lit up with energy and conviction. But I do want to go deep into that Because I think this is actually the most challenging thing in the post-taxie journey is to find that next thing that actually pulls you, that is a mission. And I'm very, very saddened by the fact that so many people don't, you know, they give up and they settle for something that's comfortable. I'd love you to share a little bit like why you didn't settle, why you kept looking for it.

10:42And maybe when this idea popped into your head and most importantly, you know, if you were financially set, like why bother? Yeah. Why mission was so important for you? Yeah, maybe I'll start with the last one and then kind of work backwards. So I think for me, it's funny. From the time I was a kid, I had parents who were immigrants. They worked extremely hard. they were basically living paycheck to paycheck to be able to put me in the school that I went to. And I'm very grateful it was a very good school. But it was a school where every other kid was wealthy, pretty much, because it was a really expensive school.

11:23And so even though we weren't poor or anything, a lot of the research in economics has shown that happiness is all on a relative basis. So people tend to compare themselves to whoever they're around. So if you're in a$1 million home, but everyone around you has a$10 million home, you feel poor. Whereas if you're in a$1 million home and everyone around you has$100 ,000 home, you feel rich, right? And so I was definitely always felt very kind of left out because everyone that was around me was going on these fancy vacations and their parents all knew each other. And my parents were these immigrants who were working all the time.

12:02And so it really actually made me quite motivated to actually just make a lot of money. And that became my goal, if I'm being totally honest. I also happen to be relatively entrepreneurial. And when I looked around, I just saw the people who had really life-changing kind of money were basically founders. Obviously, the risk is much higher, but I've never been risk averse. And so I decided to basically go for it and set a goal that I wanted to be able to retire by the time I was 35. And this is kind of in high school. And then, long story short, went through a lot of twists and turns. But ultimately, after a lot of years of pain and suffering, I would say, ended up with this at the age of 35, suddenly getting this nine-figure cash opportunity to sell the company and took it.

12:57And then I felt very, very, again, super empty, like the day that the transaction closed. And that really then set me off on this journey of self-reflection, I would say. And probably when I met you in the kayak, I was towards the end of it. But, you know, I think a lot of it was I really started by just questioning, why don't I feel better than I actually feel, given that I've on paper achieved what I wanted to achieve. and for me I think a lot of it was first of all confronting some of the realities that by working 80, 100 hour week you know for years I was able to kind of ignore many things in my life and in particular I would say my relationships, my health, I mean a lot of things were actually suffering but because I was so distracted and motivated and focused 100 % on the startup and achieving that, that outcome.

14:03I just sort of now suddenly didn't have that excuse and had to realize I've actually not been doing a great job in every other part of my life. And so that was one part of it. But I think the, the, the deeper part was, it took me a long time to really recognize that even though at one point it was probably about the money, it really wasn't about the money and specifically the the book that I reread was the Nicomachean Ethics by Aristotle I'd studied philosophy actually as a undergrad and remember even back then having this moment where that that book and those ideas really resonated with me but I went back to it and really reread it and and the punchline is that Aristotle I mean the opening chapter is basically arguing that all people want the same thing, which is to achieve a good life, happiness, what he calls eudaimonia, which is actually beyond even happiness, really sort of this feeling of deep satisfaction with your life that when you're at the end of your life and you look back, you want to feel like it was a good life.

15:10However, most of us are wrong about how to achieve that. So some people believe that it's money, some people believe that it's power, and they go into politics. We all have different ideas. But basically, he gives kind of the recipe. And essentially, the one minute version of it is if you achieve your potential, and live with integrity, those are the two things, then you will achieve this state called eudaimonia. And so I really thought a lot about, well, have I achieved my potential, I was 35, and I had this exit, I still have a huge part of my life ahead of me. And I've learned a lot about not only startups, but also deeply understanding the legal industry, which I almost think you have to have 10 years of experience in it to be able to even be eligible to change it because it is very complex.

16:02And so it just started to feel like that was a big draw. And then my biggest learning from doing startups for 15 years and investing in dozens of startups and being around founders and seeing very, very talented people and technologies fail and the reverse is that I think market timing is probably the most important factor in your success and the one that's the least in your control. And so here I was kind of in this kayak with you. And then after ChatGPT, suddenly the market's ready. And I did 80 interviews with general counsels just to confirm this. And I actually really kind of wanted to understand with very open-ended questions, not even telling them about any ideas that I had.

16:49But it was the first time I saw that 90 % of the people I talked to were making transformation by AI top three priority. but they hadn't found anyone that they actually did trust or any technology company that they could trust. And so that was when it really clicked. And I just felt like, okay, I should really go for this. Omar, you said something really important. I don't want to miss it. You said that even though you thought you were driven only by money, now you know it's not the case. And I think I know exactly what you're talking about because I see it all the time. these amazingly successful exited founders, honestly thinking that the motivation that pushed them to start the company in the first place was still the motivation by the time they sell.

17:34But I found that it actually is never the case. Because if, unless that motivation changed into something higher, like really the desire to serve employees, to serve customers, to contribute, a company does not reach that nine-digit all-cash exit. You just cannot create value out of that old motivation. That motivation is perfectly fine to start, but we have to evolve. Would you say that that's also what you realized looking back? Yeah, I mean, I think on some level, startups are really interesting because whatever motivation you had in the beginning, I think at some point, if you're a very resilient person and it just becomes a challenge that you have to solve, I think that ends up becoming, to me, a big part of the motivation as well, right?

18:30So even if in the beginning you have time and the luxury of time to think about all these things, I think, like even now, I'm back in the thick of it and I literally have no idea what's going on in the world anymore. I know, I noticed. It took me months to persuade you to come to this interview.

18:47So I think you're right. I mean, I think if I was thinking rationally about how to make the most money on a risk adjusted basis, I never would have even done the last startup, right? Even maybe a few years into it. So I think you're right. I think even back then it wasn't about the money, but I don't think I, I think most people almost need that time after the exit or when they have the luxury of time to really even deeply sort of examine and reflect and be intentional. And I think it's actually very healing because a lot of self-doubt, which is a very common thing post-exit, comes from the fact that we honestly believe that we were driven by something that's wrong.

19:28You know, we have friends who believe that they needed to kind of kill the old self for the new self to be reborn. And I really don't like this because this comes from disrespect and hatred almost for the old self, which in case of people who created disproportionate value is just never the case. and going back and appreciating how much we've grown through the startup experience is really where we need to start before we even consider killing ourselves and being reborn into a more beautiful person because we are already beautiful people and there is so much else to give, right? I think it's wonderful that you're saying because you felt it sounds like you were ready for that mission.

20:19But talking about the readiness for the mission, you also mentioned something else that I love that you realized you needed to first attend to other areas in your life, your family, your health. Can we talk about that? Because I also think it's so important for people to appreciate that you need to prepare for the next startup unless you want to run out of motivation and energy in the middle of it. So tell me how you did it. Yeah, definitely. And I think, you know, to be clear, even though I did have this very clear calling, I'll call it, it still was not like a easy decision in some ways. because by really then starting to repair and think about health relationships, friendships, I actually had some time to really begin to enjoy life a little bit.

21:18And that was also great. And to your point, I mean, I know we've had this debate on some of the forums that we're a part of, but personally, I don't believe you actually can build a life-changing generational sort of company without an enormous amount of hard work and sacrifice and so I mean I think if there was a way to do it in 40 hours a week then then great you could have the best of both worlds but I do think you have to actually be honest with yourself about what it entails and so it wasn't an easy decision and I would say what when I was during that two-year period of in-between startups.

22:00And to be clear, I was working for the acquirer. And actually, that was great too, getting a whole new experience and perspective. But ultimately, I had a lot more time to really not only reflect, but also get probably in the best shape of my life, you know, really be there for my family and for my kids. And those are all incredibly important things and so um yeah i think i think that was um great and it made it really hard so i saw you with your family and i saw you with your daughters and what i saw um back then was a man who is not only really competent with his children but is so much enjoying like you're so physical with your girls and they're all over you and it's just so organic and warm and beautiful to see your whole family together.

22:48And I remember watching it. And that was the time when you shared that you were kind of debating whether to go back to business or not, and whether it's the right thing to do also vis-a-vis your wife, who has this exceptionally successful career of her own. And obviously, that adds complexity to the situation. And I was looking at your girls, And I thought, oh, my God, you know, his heart must be just just in pain, thinking that he would not be able to spend as much time with them if he goes back to business. So if you can help me understand on like a very personal level, like how did you deal with that?

23:33Because I know it wasn't easy for you. In the end, I basically applied a regret minimization framework. so what would I regret more doing this or not doing this and for me a big part of it was this really core belief that if if I look honestly about not only my own startups but also many of the ones that I've been around it really is the case that market timing and forces out of your control are often a bigger factor in your success or failure than whatever you could control And so guided by that belief, I just really never would have expected that. Like I actually thought when we sold our last company, that might have been the peak AI, right?

24:22Because even back then, people were talking about AI, at least in the tech world. And then ChatGPT comes out and it's literally like a thousand X market growth. And you could see that it was going to become a thousand X market growth even in the beginning. So I think a lot of it was when I really thought deeply and I really ran both scenarios in my mind. And it was an incredibly hard decision because to your point now I'm, I mean, I'm talking to you from a hotel room and I'm not with my family and it's Saturday. Right. And so that is kind of the downside, I would say, to this path. At the same time, our business is taking off.

25:01The market timing was exactly right. And that's not something that five years later, if I said, okay, my kids are now a little bit older, I'm ready for it. I could just choose to suddenly have this opportunity. I could see that you would make that decision eventually because your sense of mission was too powerful. But can you tell me exactly how you organize your life so that you actually spend time with your kids? Yeah. So that is one thing I would say I'm night and day better than I was the first time around. Because first of all, I'm very, very conscious of it. And one realization I had is, I think probably a lot of founders go through this where early on, there's just, you feel like your entire success and life is on the line always.

25:50And so more work is always better. More hours is always better. I don't think that's true. I think there is an optimal number of hours and it's not the maximum number of hours. And so one thing that I've done very purposefully this time is I have pretty much every day blocked the early morning sort of couple of hours. And then in the evening, a couple of hours, we have dinner as a family pretty much every night together. I'll obviously go back to work. So but, you know, it's it's been a really, really solid. I would say I actually drive my daughter to school and pick her up from school every day.

26:29And so we have a lot of daily when I'm not traveling, which still happens frequently. But whenever I'm home, we have a lot of time together. I also block the time to work out pretty much every day. So it's kind of like the health, and then just from a lifestyle perspective, living a much healthier lifestyle too. And so the hours that I am working, I would say are like 120 % efficient. And especially with AI now, it's actually been an amazing way for me to transform how I work. And we can get more into that if that's interesting. But basically, I've really protected my time much more carefully and thoughtfully.

27:14And then I think the other thing is, even from the very beginning, I recognized that even though I probably could have done this alone or maybe negotiated with a co-founder or co-founders to have an economic arrangement where it's definitely, I have almost all the equity and they have a smaller piece. I actually chose two co-founders who I deeply respect, both of whom are incredible at what they do. And from day one, we split the company actually three ways. And so that was also quite helpful because I have really a team and I'm able to, with all those kind of factors coming together, not only spend arguably less time, like fewer hours, but the hours I am spending are all extremely high impact and really me achieving my potential focusing on things that I can actually uniquely do for the business, as opposed to just doing the million of things that need to get done.

28:12So you intrigued me when you said that you can talk a bit more about how exactly you increase your productivity so dramatically. So if you don't mind sharing something that you think people really should know and could move the needle for them. My own view is that people often talk about data being sort of the moat. I think that's very high level. I think the real moat and opportunity to really create unique value with AI comes from codifying institutional knowledge that's locked in people's heads and downloading the brains of experts. And so we're actually doing this with my new business where we will download the brain of some of the world's best lawyers once you combine that with AI.

29:02And those lawyers have years of experience working with this company. so they actually know a lot about the company as well, then you can actually build a company brain, we call it. And that's what we're basically selling in the market to each customer. But we've applied that same approach internally. And so for me, I've spent a lot of time basically, and every day I spend more time downloading my own brain and really codifying all of the... Like instead of just doing something, which most people would just do a task. Maybe I can give an example. If I wanted to write a, I just wrote a manifesto, for example, for my company, it's on our website, right?

29:43Maybe in the past, I would have actually spent, I don't know, a few hours writing that from scratch, even though I've probably written several similar ideas in the past. that's more just my own brain's training data but i've never actually like in the task of write the manifesto that would be done from scratch and most of us go a little bit from task to task operating in that way where even though you've probably done some things that are similar you don't necessarily take advantage of that in in the full capacity with ai what i've done instead is actually build essentially like my own operating system and my own content brain where I've found a way to feed every previous post I've ever made, spent a lot of time refining that with AI so that I can be very, very clear about my own voice, the nuances behind my thesis, a lot of information about the audience that I'm targeting with various pieces of content.

30:43And then when I create the manifesto, it goes from being probably a five-hour activity to a 15-minute activity, right? Because AI has all this context. And so I'm able to get it done very quickly. I imagine you front-loaded it, but then you keep adding more and more to that. It's basically a GPT, right? Of, you know, of you. Exactly. So next time I can't reach you because you're too busy, I'll talk to that person. Well, you might have already talked to him to get this meeting set up. Are you real, actually? Is it you? That was my real solution. Just create a digital twin and then I can live my life with my family.