The Central Nervous System for Modern Business | Confluent CEO Jay Kreps

27:53Yeah, it does. When people would tell you that it's not that big of a market or a customer would be like, I don't get it or whatever. Yeah. In those early days, like I know what everybody says, which is, yeah, they just don't know get it i have deep conviction yeah is that how it felt for you or like is there another like maybe more sober reality which is like each of those also sows a seed of doubt in you yeah yeah i would say um no i was pretty confident so like the early at the very early bit we were like yeah okay is there a thing here and then um very quickly uh you know we'd spent a lot of time in the space and i without that it would have been very difficult because of course yeah there's a lot of disbelief but but i think very early on as we were talking with people using the technology it was very clear that there was something there and it was very clear that um you know somebody would do this right and so i think that part was actually pretty motivating because it was like well okay somebody's clearly going to be successful at this if we're not successful at it but we were here first, that would be very disappointing.

29:04It'll be really sad to watch that happen. So we better make this work. And so yeah, actually quite the opposite. I felt like, oh no, maybe there's a question of timing. Maybe there's a question of something else. But just in our space, we kind of existed in this world where there was a lot of this batch data stuff, which is like, oh, we grab the data out of some systems and shove it in some data warehouse at the end of the day and then run some processes on it that kind of turn through it and get it into better shape. And I think we felt very confident that logically, if you want to build a business that acts on data, you're going to have something that's kind of continuous.

29:47And there was all these examples of people doing it and there was the adoption of the open source. So we kind of felt like, okay, there's clearly something happening here and logically it has to happen and it is moving now. So I think the mentality early on was like, no, it's go time. We have to go after it. And so I think we were, for a company, you're always terrified of one of two things. One is the market isn't big enough or doesn't exist, or somebody else is going to get it. It's either one or the other. If you're not terrified of one of those things, then maybe you're not paying attention.

30:23But yeah, for us, it was always somebody else is going to get it. And so it was early in the life of the company, I think, Amazon launched products in the space. And we're like, okay, that's a big competitor. Yeah, it's not ideal. And at the time, there was little write-ups. And it was like, okay, Amazon was seen as just killing off companies. AWS particularly, just killing off startup companies of all kinds all the time. So it was just kind of like, I don't know exactly what the articles were. but it was basically like RIP confluent, you know? Yeah. I mean, you mean, it probably looks like the articles that people are writing about Anthropic and OpenAI right now as they release a new model.

31:04Yeah, totally. Like RIP app layer. Totally, totally. So yeah, yeah, yeah. Similar dynamics. So at the time, the concern was much more that kind of competitive threat that we weren't going to, you know, we weren't going to get it. What was your exit headcount after the first year? We grew relatively quickly. So I would say maybe we started with three, and maybe after a year we went to, I don't know, 25, 30, something like that. You made good progress. Yeah, yeah. That's a lot. Mostly engineers. Yeah. Well, it was engineers and other stuff. So because we had the open source, we put together a product pretty quickly.

31:43So we had a product in like six months or something after starting the company. It was quick. It was not much of a product, but it was a little baby product. Yeah, so we were basically in the market in the first year. And that was kind of part of that same... The idea was like, okay, we raised money, now's the time for this. I think we felt maybe we were a year later than we should be starting. In retrospect, I don't know that that's true. Why did you feel that way? Because AWS and others were starting to release stuff? Yeah, I think there was enough happening in the cloud and there was enough adoption of the open source.

32:26And now nobody remembers them, but there was these Hadoop companies that were doing big data stuff. And they were kind of adopting the open source. And we were like, just, okay, these companies are bigger than us. And AWS is much bigger than us. And so we were like, we just have to go after it. So, yeah, we pushed very, very, very hard in those kind of early years to just, you know, get out there and soak up what we could and kind of grow the company, you know, I think in a healthy way, but go after it. Isn't that the great ironic hallmark of most entrepreneurs is like everybody thinks they're late and you have no concept of what the market is actually doing?

33:11That could be. That could be. I mean, in our case, we always had this open source project that was out ahead of us. Right. And so it would just be like, okay, you know, there's thousands of people using this and we have like whatever, five customers. What is wrong with us? And so, you know, we felt very driven to get out there while there was, you know, while the time was right, I guess. Yeah, that makes sense. If you look at what's happening today, part of the reason why I asked the headcount question, is this, if you were rebuilding Confluent today, I know we're living in a bizarro world again, but if you were, would you hire the same amount of people?

33:51Yeah, it's a good question. I mean, right now, there's kind of a meme that AI, you could just be like 10 times more efficient. I don't think that's quite true. Some of the AI companies are lean, but a lot of that is just time. If you look at how they're adding people, they're adding people at a rapid rate. They're just, the company's four years old. There's only so many people you're going to have. And in practice, the more human intensive things like a larger sales force, you're just going to are only going to build at a certain rate. So I do think there was a period where all companies probably added too many people, including Confluent, right?

34:33But I don't think today you could dramatically change things. Whenever you hear somebody say like, oh, you could do it with 70 % less people, I don't think it's really true. With the one person billion dollar company. It could be true. It could be true soon, right? It's just not true. What would change for that to be true soon? A number of things have to change, right? So first of all, if you want to get there with, if the idea is that you can do it now because of AI, I think the models need to be good enough to do a lot of stuff on their own at a level of quality that we're kind of just getting to in some domains.

35:11And you would also have to have the ability to orchestrate a lot more of the kind of tooling that does stuff within the company directly from the model without having to build that yourself. and I think those two things are not quite there, but he's getting there. So the thought is right. I think it's just probably a couple years ahead. Yeah. We'll see. I mean, there's a lot of hiring among AI companies. They're small, but mostly because they're young, I think. Right. They're growing. Even them, they're not slowing down. Yeah, that's right. That's right. Yeah. Do you still write code? No. No. You think if you brought the old fastball out, you could still...

35:54Yeah, yeah, I still can write code. But I mean, you know, the... It's just not a good use of your time? Yeah, well, I guess there's two questions, right? So one is, do I write code for Confluence product? Which is like, no, absolutely. You know, all of that stuff has to work really well and be cared for over a long period of time. But I still write code on the side. Yeah, yeah, yeah. I mean, once you have the skill, it's... But you enjoy it. It's usually useful. Yeah, I don't do, I used to do big, long coding projects. And, you know, the problem with being a CEO is you just have too many little interruptions to sustain that kind of stuff.

36:29Yeah. But, you know, I can do small little coding projects, which are actually the more fun ones. You don't want to check in any code to the Confluent? No, it doesn't help. You know, it's an interesting symbolic move. But, you know, the thing with code is somebody has to kind of own it and care for it. So coming in and dropping some 90 % done thing that somebody else has to clean up is not actually a gift. Symbolic like, oh, you know, whatever, Sergey at Google is now checking in code. Yeah, yeah, yeah, exactly right. And everyone's like, oh, he's back type thing. That's right. He's engaged. So does it symbolize that that's an important effort?

37:08It does. Is that meaningfully increasing the velocity of the Google AI team? Yeah, probably not. Yeah. Probably not unless he's there every day doing it. Ultimately, there's different types of jobs, but computer programming is a long attention span, long chunks of time, day after day type of thing. Popping in with your cool idea half done is not that useful. Where it's useful is if you want to prove to people that something is possible. To be built. Yeah, you can build a demo. You can build - Oh, like they'll tell you we can't build that feature. You'll be like, I'll show you. Yeah, yeah, that's exactly right.

37:46Do you ever do that? Yeah, yeah. No, certainly the - Have you done it? Well, certainly the, you know, engineering always works off time estimates, which is like, how long will it take to do this? Right? And it's all hypothetical. And so, yeah, you can do a little bit of demo coding to show that it probably could be done faster. Meaning you'll be like, okay, we have three months to ship this feature. And they'll be like, Jay, you nuts, like three months. Like it's going to take us at least six. And you'll be like, all right, cool. that weekend you go hack on something and then you come back and you're like i got 80 i think you can prove little bits of it uh you know you can't really prove the production yeah quality finished product and then i think just having you know intuition of how things could be done differently i think that helps speed things up at times yeah when the company started to really take off yeah did the ceo job become more fun or less because i think good people People obviously, the dream is you are part of a high growth company as the CEO and founder.

38:47That's right. But from the conversations that I have almost every day, I think there's a bigger burden than most would realize. I actually don't think the CEO job is super fun. You know, it's not like a joyful job. You know, you typically have a lot of like bigger problems that have to be solved. There's always more pressure. It's never, I can imagine, it depends on your definition of fun. I think the people who are drawn to it, I think there's a set of different reasons. One is, okay, you're trying to accomplish something. The other is you like the ego side of it. There's probably others. But I think certainly being a software engineer is more fun than being a CEO.

39:36You think so? Oh, yeah. Yeah, absolutely. Yeah. But it depends what you enjoy. Right. But the you know, for people who enjoy software engineering, you get to just do that for, you know, for the CEO. It's like whatever the biggest problem is, you need to get that solved. But then but you enjoyed software engineering. Yeah. Yeah. Why didn't you just keep doing that? Yeah, it's a good question. I mean, ultimately, you know, for me, I always want to like, you know, solve some problems. So we were working on this thing. We wanted to solve this problem. What do you have to do to solve a problem? Well, we had to start a company.

40:07What do you have to do to make the company successful? You have to do all these other things. So you kind of fall into it that way. It's not a lifestyle job, is what I would say, at least not the enterprise CEO. I think there's versions of this where maybe you can be off on your island and think interesting thoughts and somebody else runs the company. But I think actually the best enterprise CEOs, it's hard work. You're traveling. You're meeting the team in different places. You're visiting customers. you're solving whatever problems are in the business. You know, it's, it's, uh, you know, it's a workhorse job for sure.

40:38Do you feel like you have the juice that you did 10 years ago? Yeah. Yeah. I, I, yeah, I definitely, I mean, if anything, I think the biggest difference is the skillset has improved substantially. Um, you know, I, the, the challenge as an early founder is like, you're just, unless you've been a CEO before, you're not really good at the basics of the job. And so you're both trying to do something really hard, but you're also just trying to learn how to do it at all. Yeah. So I actually think that helps a lot in terms of just getting stuff done. And then I think if anything, the workload probably ramps up as the company gets bigger and more complicated.

41:22I mean, it certainly hasn't ramped down. You think you work more now than like year one? It's probably about the same. I mean, I feel like any of these jobs, you kind of max out on what you can do. And after that, you have to delegate or let it slide or whatever it is, right? But it's going to fill the time that's available. And that happens pretty quickly, right? There's no point in a company where there's nothing left to do. Yeah. Do you find pockets of time now that are sacred for you? Yeah, yeah. Do you have a notion of sacred time? Yeah, well, there's two things. I mean, first of all, I also have a life.

42:02I have a wonderful family that I love to spend time with and friends that I do things with. So that exists, right? And it's probably less time for that than it would be if I wasn't doing a very intense job. But I still really care about all of those relationships and all of that. Do you create intentional space for it? Yeah, yeah, yeah. I think if you don't, well, you know, I think, look, for any of these very demanding jobs, I think it will eat whatever is available, right? And so you could work 110 hours a week and you still wouldn't be done, right? And whether or not you're making things better in that 110th hour, I don't know.

42:45You're probably pretty exhausted. But, you know, so at some point it's about, you know, you have a capped allocation of time and you're directing that at the things you think are most important to get it done. Right. And that is going to be what it what it is. And so I think and I think that's how I think I saw any kind of executive job ends up working where you're just like, OK, this is, you know, this is the this is how we're allocating time. And you're kind of rearranging that to try and focus on the things that matter. And that's, you know, that's the only way to do it, I think. I've heard Eric Schmidt say in an interview that his sweet spot is probably 62 hours.

43:22Like he's like some formula that he has where he's like anything above 62 is just completely wasted. It's completely wasted. And 62 is like, I'm fully, fully loaded. Yeah. That's the interesting framing. Yeah, that's interesting. I mean, so first of all, I've never found, you know, people always say that they're like, oh, it's not productive to work more than X hours. I've never really found, I mean, at some point you have to sleep. But I've never found that like, oh, if you do more work, you're actually going backwards in productivity. Maybe it's not your most valuable hour. But, you know, is it sustainable?

43:56There's some point at which it's not sustainable, right? Or not a thing you could keep doing for, you know, multiple years. Has it always felt sustainable for you over 10 years? No, I always work, you know, I felt like I've always worked in two-year sprints kind of where you're like, okay, you know, this is what we need to do in these next few years. I can definitely do that. you know, beyond that, who knows? And I think that's easier for me, at least. Some people have some grand multi-decade plan, I'm sure. And then after two years, you like, Yeah, there's always something that has to be done.

44:29Take a beat, and then you're like, all right, here's two more years. Yeah, totally. Totally. And then, yeah, you know, I think in, you know, at work, I always think it's important to have some things that are fun, that you're excited about. Like what? You know, for me, it's always something, I always like these new product initiatives, the kind of early stuff, you know, I think that's very fun. You know, trying to get some of the early things working, get customers to use them. It's always the messy time. I mean, parts of it are often very frustrating, but I like it and I feel like, okay, I add some value there.

45:02So I like it. So I think it's important, you know, even, you know, I think it's always important to have disproportionately do a little bit of the things that you like doing. yeah like some outlet of i was like uh what was i reading this they were talking about how at some point in amazon's you know it was like public and things were going okay yeah and then jeff uh wanted to do the phone yeah and nobody really thought it was a good idea yeah except for it was just an outlet for jeff yeah to be able to do something to keep him engaged and they were So even if we burn a billion dollars, but it keeps Jeff engaged, that's probably a win.

45:46Yeah, that's right. They never got that phone to quite work. It just got announced that we just led the B of a company called Harmonic. I don't know if you've seen it. It's like a math base. They're going to go to the international math competition and go solve math problems with their LLM. The LLM is going to compete with these smartest mathematicians. and they're building a math foundational model to go solve the hard math problems of the world and then make a bet that you can do a lot more once you've done that. And, you know, Vlad from Robin Hood is the chairman, but like involved, you know, but he's not like a day to day.

46:23And then, you know, like there's all these like, uh, you know, uh, Brian Armstrong is doing new limit, which is like, you know, there's like these side quests again, like in the spirit of like outlets. Nobody ever thought before until Elon, really, that outlets could be other companies. That was allowed. And he's proven, well, it turns out it is allowed. Yeah. And you ever think like, ah. No, not for me. That's too much. I always feel like, but I don't know. I mean, my feeling has always been, you should really do the thing full-time and full engagement, right? So the models where, you know, you have some COO that runs the company and the CEO goes and thinks about the future.

47:09You know, I think it's a little irresponsible. You know, like there's some place where all the parts of the company come together. And if it's not the CEO, it's somebody else, then, you know, did you, you know, are you, are you getting the best person for that job and or are they able to do it as effectively as they could that's fair but let's just say one of your best employees at confluence yeah is like similar to like what happened at linkedin right yeah they're like jay i'm gonna go start this company yeah can you help me yeah and you'll be like yeah great you want me to introduce you to venture capitalists whatever and i'm like no no like can you be involved and you're like man like i love this problem that you're solving you know like well jay can you just like you know join me on the board and spend, you know, like some time helping us raise some money and we can like iterate with us and be the chairman.

47:58Don't be involved on the day to day, but like be the chairman and help us with some like brand credibility. Would you take them up on that? You know, I'll meet with people periodically and try to help them. But like entrepreneurs are really helping, like really getting in there and doing it. The answer is no. I just I think you have to have some some like focus and commitment. Yeah, I think it's really easy in Silicon Valley to get distracted by lots of little things and just not do anything that well. And so, and it, you know, I feel like it would be, it's like irresponsible as the people, you know, inside of Confluent who are working full time there.

48:34If the CEO is off doing whatever else. But here's the counter argument to that in the Bezos example. Sure. It's like, is Jay at 90 % capacity or commitment better than no Jay? And if what it takes to get Jay to stay here is 90 % capacity and that 10 % goes to some side quest that he's doing, is that worth it? Yeah, who knows? I mean, it's easy to tell yourself a story like that. Totally. But at the end of the day, I mean, you know, and there's different types of companies. But I feel like, you know, we're in a fairly demanding business. And so I think it's just really easy. It's hard enough with full-time engagement and a very high level of energy to make everything go well.

49:25I think it would be very difficult with a couple of side quests going and the venture fund on the side and the second company or whatever to really keep things on track. At least for me, as I was saying before, I've never found that the marginal hour of effort and time doesn't help. and so you know i think you kind of have to make some choices about what's most important otherwise you just end up kind of very diffuse across a lot of things yeah how do you run your days like i'm curious like give me a day what time do you wake up what do you do when you wake up oh i get up early and uh yeah probably about 5 30 and oh like actually early yeah for an engineer especially earlier yeah yeah yeah and uh and then i go work out and then every day uh almost every day.

50:14Yeah. Um, you know, as, as long as I slept well, um, and then I, yeah, then I come, uh, come work for, you know, the chunk of time, you know, either going to the office or from home. And, uh, um, usually that's the bulk of it. So in some, some extra meetings and focus time, but like, okay, you work out, let's go like actually detailed through it. You work out five 30, you're done at six 30. Yeah. Uh, yeah, yeah. Yeah. Around there. Um, ish. Yeah. You go home? Are you working out at home? Are you going to the gym? Yeah, I go to the gym in the morning. And yeah, then come home and have, you know, coffee.

50:51Assuming there's no evening thing, then, you know, hang out with my family. Did you do the coffee before you worked out? Yeah. Yeah. Are you into the like creatine and all that yet? Have you done all the Rian Johnson protocols? No, I'm not on the full Rian Johnson protocol. Okay. So you just go do a normal workout? Yeah. Come home, breakfast with the kids, family. Yeah. No, I just eat on my own. The kids are now teenagers with probably busier lives than me. You know, they're off swimming and going to school and doing whatever. When you work out, do you listen to things? Yeah, I actually do. I go to like a workout class.

51:29I do, you know, it's a cliche now, but CrossFit. Oh, yeah. So you don't listen to anything? Well, it's just whatever they play. Yeah, okay. Whatever they play in the class. When you work out, do you think about work? No, no. One of the things I like about it is, you know, the workout's hard enough that you just really put aside everything else. So, you know, for me, I always find it's kind of meditative. You know, you just want to clear your mind. So I used to run a lot. And you kind of do that, but you actually also just kind of think about things a lot when you're running. Yeah. But if the exercise is a little harder, then you really don't think about anything other than what you're doing.

52:07That's why you switch to CrossFit. It's more rigorous and therefore you can turn your brain off. Yeah, it turns your brain off. I think that's really nice to do something that's hard and physical, not intellectual. You're kind of very present in whatever you're doing for at least that little chunk of time. Then you kind of go on with the rest of your day. Let's say you go to the office. Do you have a meeting start time that's ideal for you? Not before a certain time? Yeah. Yeah, I try to keep it to 8 a.m. It's pretty early still. Yeah, yeah, yeah. But the company is very global. And so the reality is if you want to coordinate with people in Europe - You could be doing calls all night.

52:51Yeah, you can't be really picky about the hours. You have to have some early mornings and some late nights or not get in much time with people who are in different time zones. Yeah. I'm curious. I was with Henry Shuck, the Zoom Info founder. Yeah. Well, I think he's like one of the goats. Honestly, I love Henry. He's a great person. He's a great CEO. Yeah. And I was at his house in Boston. Yeah. And it was me, him and his daughter having dinner together. Yeah. And it was like actually like a really nice moment of like a public company CEO just like sitting down with his family having dinner. Yeah.

53:27And I was like, how often do you do dinner at home? Yeah. And he was like, almost every night. Yeah. And I'm like, can you get away with that? Yeah. And he's like, if I travel, I try and make it in and out. And the reality is like, I'm not traveling that much like I used to. And he was like, now I've moved every dinner meeting basically to like a coffee at five o 'clock or a lunch or whatever. He's like, I don't even think people want to spend three hours with me. And I don't think people want to be eating when we're talking together. He's like, so I have dinner at home almost every night. And I was like, oh, yeah, that's pretty good.

54:03Yeah. Yeah, I feel like I end up with a fair number of dinner things, but not, you know. Yeah. I eat at home a lot. But now, you know, the kids are so busy that like whether or not they're eating dinner, it's not like family dinners every night. Totally, totally. But it's not because I actually would like that. I think my wife and kids are probably so busy. I'm the weakest link. Yeah, yeah, yeah. And then what time are you in bed? You go home, what time are you in bed? Certainly by 10.30. Okay, that's not bad. Yeah. Do you work until you go to sleep? No, no. Like, are you in a bed laptop guy? No, ideally not.

54:39I mean, every once in a while you're on email or something. But no, I always find it hard to sleep if I do work stuff right before. Then I'm just, you know, that won't turn off at all. It won't? No, no. And is there like a buffer that you give yourself to? Yeah, yeah. I usually try and leave at least the last hour and a half, two hours. That's pretty good. Yeah, totally. Go and do not disturb or something? Yeah, yeah. So sometimes I'll go eat and I'll have a little bit of things to clean up in the end, you know, do a little bit of work and whatever lingering emails and sometimes nothing at all.

55:11And then what do you do in that hour and a half, two hours? Like, how do you fill that time? Yeah, I always feel like the, oh, what do I do when I'm not working? Yeah, like call it from 8.30 to 10.30. Yeah, all kinds of random stuff. You know, I hang out with my kids. They're at the age where it's like, okay, you know, you have teenagers. They're not going to be around. forever, right? You know, if you're 15, you got a few more years, but eventually they're going off to college. So, you know, I like to try and, you know, just see them. I, uh, occasionally I play video games with friends. Uh, I do, um, you know, just random things.

55:50I used to do a fair amount of rock climbing with friends, but I haven't done as much of that recently. Um, so just, you know, random things. Do your kids know like that dad is a big deal? Like, do they know that like he's, you know? Yeah, they're completely unimpressed. You know, it's just the nature of teenagers. Whatever your parents do is just the dumbest. You think they don't care? Like, wow, you got off that earnings call. I'll tell you, as I was leaving, my daughter was driving up with my wife, and I was like, hey, I'm going off. I'm going to be on a podcast. She was like, what's the podcast?

56:24And she was like, I was like, the Grit podcast. She was like, oh, I listen to that all the time. And I was like, oh, you do? And she was like, no. They don't care. So that's, yeah, that's the basic attitude. Yeah, yeah. And I was like, oh, I thought it was cool. That's awesome. But I will tell you, when they were littler, it was much easier to impress them. In fact, the best one was, there was some marketing video that had me in it. So I was sent the draft copy. And so I'm watching this video. And it's on YouTube, because that's where you're going to share the video. so even the draft is on YouTube at Password Project.

57:02And my daughter comes over and she sees me on YouTube and she's like, you're on YouTube? How did you get on YouTube? I don't remember how old she was. That's adorable. And I was like, yeah, I'm on YouTube. And I was like, this isn't the only one. I have lots of videos on YouTube. And she was like, oh my God. She was like, how did it happen? And she had no idea that anybody can be on YouTube at that age. Uh, but, um, but I think that was the, that was the peak. That was where I peaked. It's been all, it's been all downhill since then. Do they, has your passion for software, tech, engineering, and company building turned them the other way?

57:41No, not, not really. Have you gotten more interested because of it? Yeah, no, it, yeah, they, they are not that interested in it. Um, the one loves to tell me how much she hates her computer science class. so uh yeah so you know but i think isn't that the way it is like with your parents it's it's really hard to be independent of them so you're either in uh you know you things you do are either in their footsteps or in reaction to you know like it's just hard to have no relationship to it so you either do something because your parents did it or you don't do something because your parents like my parents were scientists and the last thing i wanted to yeah totally like science absolutely yeah absolutely so so um but and and it's just because there's there's so there's such like a big part of your life right that it's hard to you know it's hard to ignore when the kids were growing up yeah and there's four of you right you and your wife and the two kids yeah would you talk shop at the dinner table yeah a little bit but not a ton you know my my wife was a history teacher so she's not like a software person right Right.

58:48So it wasn't like we were geeking out on, you know, whatever the latest open source thing was. But we talked about it. We talked about it. We talked about the company idea a lot before we started it. I talked about some of the things I was working on. So, yeah, we would talk a little bit about it. But, you know, for little kids, they have no idea what the stuff is. You know, they're like, oh, yeah, dad makes apps. That's their conception. Yeah. You know, whatever the thing on the iPad, that's what they understood. Now I think they have a better idea, but, you know, are even less impressed. Do you not worry about, like, they probably didn't grow up how you grew up.

59:22Yeah, totally. You're running a big billion, big company. You probably live in a pretty nice place. Yeah, totally. You can travel how you want. They don't have to worry about money. It's not a thing. How do you relate to that? I think it's a huge concern. I mean, I don't know. Nobody really knows anything about parenting. That's one conclusion I've come to is there's a lot of advice, but it's unclear where it comes from. It's a lot of people's opinions, but it's not clear that they've proven it out in some way. But I worry a lot. I think people need some amount of struggle in kind of doing things on their own.

1:00:09So what are you going to do, like hand them the struggle? Yeah, I think you can't, right? It's just kind of cruel if you manufacture some iron chip for your kids. So inherently, yeah, I tell them all the time, look, you've got a lot of Palo Alto problems. They're not real problems. They're Palo Alto problems. But I think it's hard to know that because it's true for any of us. We kind of live in our own reality, and it's extra true for teenagers because that's all you've really seen. And so it's hard to have perspective. you know and i think that's always true you worry about it um yeah yeah yeah but i you know i even if your kids have a good head on their shoulders it doesn't matter still you got to worry about it i imagine yeah i i i definitely worry about it i mean i think i think you can only do so much as a parent you know i i've been you know i i think maybe you have 30 percent influence at best uh but i i think a lot of it is like you know kids are born with some personality that's kind of there yeah and it could shape itself in different ways but it's kind of a real thing like the the two kids i have are actually you know kind of different in their personality but they're it's obviously same parents and kind of raised the same way so i i you know that was really eye-opening for me to see that and then obviously you have probably some impact on how you try and raise them, but of course their friends have a big impact and there's lots of randomness.

1:01:37And so it's really hard to know, oh, you know, what you should do. Right. And when it comes back to it in parenting, you know, even when you see all the advice, half the advice is removing hardship and half the advice is adding some kind of hardship and work and struggle. And so it's like in the end, I don't think anybody's, uh, I'm probably more in the, a little more hardship and self-sufficiency. And have you found gentle ways of applying some hardship? But it doesn't really work. And I don't know if we have the follow-through. At some point, we tried to make them do chores to get money and then pay for most of their stuff just so they would have kind of an idea of what it is, even though at the time we started this, they were too young to really have jobs.

1:02:26It kind of works, but not really. I think it started because my daughter lost her shoes. And I was like, how do you lose your shoes? And she was like, I don't know. I just lost them. And I was like, well, we got to buy new shoes. And she was like, well, what do shoes cost? Like$8? Just buy some more shoes. And I was like, well, first of all, shoes don't cost$8. And you need to eventually learn what shoes cost. So yeah, I think that was an example. So did it help? I don't know. Maybe. you know I think you don't find out until much later what they're really like. It is funny like I gotta imagine you never expected to have like I mean all my guests are you know successful and billionaires and do the whole thing right?

1:03:08Yeah. And I don't think you realize until you're there the like weird problems that you start to have like that you just probably never expected like all right we're going on a family trip for example. It's like okay like my family trips like we all were in economy yeah you know yeah probably yours too i don't know my family trips were camping yeah exactly and now you're like all right like she's like i don't really want to sit economy yeah you're like i want to sit in first like i've earned it you know same with my wife yeah and then you're like well do the kids sit in first and it's like well geez like i i mean we can afford flying private like what we could just what so are the kids gonna fly private you know like then you start like asking yourself these like really like bizarre questions that I actually do think probably exist.

1:03:56Most of the time, we're like, what a weird set of questions to be asking myself, you know? Yeah, totally. I mean, I don't know. From my point of view, I feel very lucky. And I think the kids will probably be fine. I think kids are pretty resilient. You know, they can go through all kinds of bad things and come out fine. And, you know, growing up in Palo Alto is not the worst thing. Would you hire your kids? Not right now. Um, but you know, I think eventually they'll be great. You know, I, I don't know. It's, um, I always think I really like teenagers. You know, it's kind of depends how you think about teenagers.

1:04:33Some people don't like them. Uh, I think they're great. And I, I, I really like my kids. I think you can kind of see the outline of what they're going to be like when they're totally grown up, but not quite right. Yeah. What's your failure mode on hiring generally? I think I am a little bit too risk prone in that I would like somebody who is potentially amazing, but possibly awful. I don't know if it's bad, but I just, I'm, you know, versus certainly pretty good. And I, you know, I have a question myself sometimes whether that is played out perfectly. If you had 10 candidates that you made that were the high variance, that could be great or could be awful.

1:05:17Yeah. How many of those 10 do you think turn out to be great versus awful? Yeah. I mean, well, okay. First of all, could be great doesn't mean necessarily great. Fair. But yeah, I feel like it's probably a 10 to 20 % bad hire type situation. And of the rest, maybe it's not all amazing, but good, right? And then a few amazing? Yeah. Yeah, absolutely. And you take that math, right? I think so. I don't know. I don't know. Why wouldn't you take that? Why do you question that? I do think bad executive hires are a pain. Especially in the fastest growth parts of the company, you end up with a lot of people that probably shouldn't have been hired or bad decisions that are difficult.

1:05:58But yeah, I've always liked that. I always like to work with people who are maybe a little bit more interesting and potentially amazing. And so like, at least for me, I've felt good about that. Do you feel like now you'd feel more comfortable taking the basket of 10? Or in the early days, you'd feel more comfortable taking the basket of 10? Yeah, I definitely haven't gotten less risk averse. Right, right. You know, I think probably, I think one thing that helped is I definitely got more clear. You know, the challenge hiring executives early on, if you found a company is like, you literally don't know what these jobs even are.

1:06:34and you've probably never worked closely with anybody who did them. So you're just the least qualified possible person to make the evaluation. You're trying very hard to learn and calibrate and whatever, but you just don't know what you're doing. And then now, the thing I've always tried to do is like, okay, if an executive leaves the company for whatever reason, I'll try to run that function almost always. And I think that's a really good practice because then you're like, okay, this is what this job is, right? this is what they do and this is what they have to do and this is how it would go well or not well and you know I think if you do that and you know enough people who do that job you can get pretty good at being like okay this is what we this is what we need right to be successful this is what really matters and that's how I think you can avoid the list of 15 must-have characteristics or whatever and just not not really knowing and so yeah I found that really useful and I think I think you just learn, it's part of just getting better at the CEO skill set is literally learning each of those disciplines.

1:07:38Like what does that person do and what makes somebody good and how can you tell and what do we need and what's the type of this that we need and how is somebody going to be successful here and not successful. I think just really like building that knowledge I think is like a big part of the CEO skill set. But if you can ultimately do that and assemble a good executive team, then you're going to do okay. How long will you sit in that job for? Until we hire somebody. Are you serious? Yeah. So like if your president leaves. Yeah. By the way, Erica. Yeah. One of my favorite execs on planet Earth. Yeah.

1:08:15Yeah. She's great. She was five years there. Yeah. Let's just use her as an example. Yeah. She's just like just stepped away. Yeah. Yeah, we had somebody in, you know, under her to kind of step up. Got it. Okay, so you could... So that was an easy one. Maybe a bad example. I'm literally... But if an exec search goes for nine months, you will be the VP of finance or the CFO for nine months. Yeah, so I'm running the engineering team right now. Okay, but that's like kind of second nature for you. No, but before that, I ran the people team for, you know, the HR team. For how long? You know, however long it took us to hire somebody, five months.

1:08:50Are you serious? Six months, yeah. You'll run it. Yeah. Yeah. I mean, not, I can't. But you will absorb those directs? I'll rearrange it a little bit. So, you know, if somebody had 10 direct reports, I probably can't add 10. So I'll, you know, I'll fix it up so that I'm, it's a little bit more manageable. I think it works really well, actually. You know, it's time intensive. But you end up learning a lot about that function. And then I've learned how to fix things up kind of in the interim periods a little bit. One of the things I've found is it's very hard for a new executive to come in with confidence to make a bunch of changes for a bunch of reasons.

1:09:30It's hard for them. They don't want to rock the boat too much with the people who are in the team. They may not have enough context to have confidence. And so in that interim period, I have a lot of credibility already built with the team. So I can make changes that I think will be, that I am positive will be needed, and that will be harder for somebody to do before the new person before the new person comes in so i feel like give me an example yeah you know um you know sometimes it's kind of organizational structure you know sometimes it's people who i think shouldn't be there you know sometimes it's promotions yeah sometimes it's prioritization or other things but i think it can make it um you know i think it's actually much better for the person coming in to come into something where it's okay there's a lot of work for them to do but it's you know you've kind of fixed it up a bit for that.

1:10:15That's interesting. If there's some weak people in the team, usually the new exec is now like, all right, go figure out if these are the right people. You're like, hey, if there's some obviously stragglers - Yeah, obviously I have to have confidence to do it. But I just feel it's hard for someone coming in to be confident in what they're seeing. And then they don't feel that they have as much runway with the team because they're new. And so they don't want to you know, rock the boat too much. They'll do some things, but they're, you know, won't be quick. You think they're more trigger shot. Like I have heard, even in my own experience hiring people, my general advice is like, Hey, don't do anything for a couple of months.

1:10:58Yeah. Yeah. Just because like there is some of these things are broken, but some of these things are by design a little bit messy and chaotic and you got to learn what those are. I think that's right. So, um, yeah. And so, so, you know, the way it works is like, okay, let's say there's an area that's not perfect. That executive is going to leave. Right. Um, then you're running it. You know, what's broken. If you don't change anything and you bring somebody else in, they're going to start fresh doing the assessment. You're going to be like, oh, here, this is kind of what I see. It's going to take them another three months.

1:11:28So that whole time period, you know, it's like a year of bad, right. Versus if you just kind of fix it quickly, you can't fix everything, but fix what you can. Um, I think it's much better. and you know having to do that makes you really learn how the that part of the organization works it um and doesn't work and i think it makes you hire much better and i think it's better for the executive coming in because they kind of know you know what they're getting into and they're coming into something that's you know in reasonable shape that's true but like isn't there a risk if you're running marketing and they're like jay we want to do something around adwords or some billboard campaign or something, right?

1:12:07Some big strategy thing. And you're like, I have no idea. Yeah. Yeah. But, um, there is. And so like some things you'll get wrong because you just don't know the discipline as well, but your job is to indirectly manage somebody who runs marketing. So you have to know enough to at least understand the big things. And, um, and, you know, I think that's how you build the understanding and there's some things you'll do better. Uh, one of the nice things about being CEO is you have more ability to help interaction with other teams. So a lot of things that are holding teams back, you can actually fix better than the person who would be there otherwise.

1:12:47So there's some things you'll be worse at. There's some things you'll be better at. Overall, you're worse because you don't have enough time to do it 40 hours a week or whatever it should be. But I think it's actually a really healthy thing. I think the CEO job is ultimately kind of integrating a lot of these functions. And so you have to know, you know, you have to know enough to be dangerous. And if you don't do that, I don't, I think it's very hard to manage executives because you just don't know what they're, you don't know what they're doing or what they should do or how they would do it or so on.

1:13:16You're never going to know it as well as they know it, but you have to have, you know, you have to have some feel for what that is. And, you know, and you'll still make the decision, even if you're like, I don't know. Yeah. I mean, like I'll, I'll only do things, you know, there's some things I'll hold off, So if we're making some kind of, hey, this is going to be our philosophy of XYZ. And I'm like, look, I'm probably not going to be the person setting that philosophy in six months. It just doesn't make sense to make a big change like that. But yeah, if there's things that have to happen, I'll try and do them.

1:13:45And some of that maybe is wrong. Some of it's probably right. Usually, you're just going after the things that are kind of obvious that can be improved. And I think that works. And so I've gotten more. I've always done the manage the team. I've gotten more hands, you know, at first I was very, you know, delicate in terms of like, oh, we won't change anything, you know, nothing, everything will just be as it is while we do this search. But, you know, I've come to believe that actually that doesn't really make sense. It's very slow. And, you know, you're usually not wrong. You're not like totally wrong in the things you're seeing.

1:14:22And so I think it's actually fine to make some changes. And, you know, I think the team actually usually I think kind of enjoys working with the CEO. It's kind of fun. It's usually that next level down that wouldn't directly get to report to the CEO and have the interaction. So I think it's kind of fun for them. They get more context on other parts of the business. So I feel like they learn something and then I learn a lot because I don't know how the function works. And so I have to rely on them a lot. So they actually end up being kind of mini versions of whatever the leader is because I'm just pushing a lot down to them of like, hey, I need this.

1:14:53right? You know, how do we do this? Like, can you help me figure that out? And so I think it's, it's fun for them, hopefully. So yeah, I think it works really well. And I think if you don't do that, you know, I think the challenge is how do you just stay up, you know, stay up to date in all these areas, you know, what it is, you know, you know, I think you see that a lot where, you know, the CEO is ultimately just disconnected from how parts of the business work. And of course, that will happen, right? There's many things happening in the company, but you have to be connected enough to kind of have some instinct as to whether things are right or wrong or what to do i really admire that approach that's a great approach do other ceos do that i think so i mean you have to do something in this interim so you either pick somebody in the team to kind of run it yeah yeah um you know but the and that works like if you if you're very time constrained i've done that for sure uh but sometimes it's not obvious who would run it and you're kind of often just putting the putting everything on ice if you do that totally and um you know it's usually you're more likely to lose some of the good people one click down if you kind of just totally pause it like that totally so i feel like this works well you just have to have you know flex in your schedule to be able to do it totally right so like you know i always try and leave some time for the big thing so you know and you can have maybe one big thing or two big things but you can't have like five big things.

1:16:18Right. And so this is one big thing. If I'm, if I have a function I'm running, that's a, that's a chunk of time. Yeah. Fascinating. I really appreciate you doing this. I could spend hours with you just talking about this stuff. Are you hiring? Yeah. Anywhere, any roles, any, it's a at scale company. So you're always hiring people for something, you know, so yeah, across the board, we're hiring engineers. Um, I'm hiring a CTO. So you're doing that job right now. Yeah. I'm doing it right now. Yeah. Um, you know, to the best of my ability in limited time. And yeah, and we're hiring salespeople and other areas as well.

1:16:55My final closing question, when you hear the word grit, what do you think of? You know, I guess persistence, you know, like keeping at something. I appreciate you. Thank you. Thanks for doing this, man. Yeah, pleasure. That's it for now. If you liked the episode, please leave us a review or go back into the archives where we've done more than 200 episodes with some fantastic folks. This podcast is a Kleiner Perkins production, and I'm Juven. Thanks for listening.