E431: Marty Kausas on AI, Trillion Dollar Startups & Founder Psychology

25:56It's already asked the people questions, and you're just saying, okay, do I approve this work, or do I want to direct it to do some more stuff? And so this is the same thing in coding. Before, you used to review the code, write the code, test the code, etc. Now you just tell an agent what you want it to do, And then it goes and does all that work for you. And so you're just delegating work. And so that transition from doing the work to now orchestrating agents that do the work, we call going agentic. And so traditional versus agentic. Is there corollary between the human plus AI solution with the last mile problem for something like a Tesla self-driving?

26:33There absolutely is. I think back to the autonomous trucking companies where it was like, we can do 99 % of the driving, right? But the problem is someone still at the end has to unpack the car. And so you can't actually get rid of the person. The person still needs to sit in the car the whole time. For Tesla in particular, I expect that, hey, yeah, for example, having the human in the car still with a steering wheel to take over when needed allows you to get a lot of the benefits of autonomy without having to wait until it's perfect. So, hey, maybe you have to like park it in your garage and that's it.

27:19And it's great that you can get 99 % of your drive done by AI and then you park it yourself. And that seems like a good trait. And then also, I feel like it's easier for a company to incrementally iterate from that point rather than have to wait and be like, okay, we're only going to enter the market when we're a hundred percent of the way there. So there's just so many edge cases. And so same thing with that we're seeing with our AI in our customer support product is like 90 % of the time the answer is right, but there's cost when it's wrong. And so you still need the human to validate whether it's right and whether, hey, the right steps were taken and the logic of what it used makes sense so fundamentally that human beings are much smarter than we give ourselves credit for or just so much better at pattern matching than an ai at least today can be it's interesting i do wonder to myself if it's a context problem like the way companies operate today there's so much spoken word context that doesn't get captured somewhere and if it did like if for example every conversation at pylon ever have been recorded and logged somewhere then maybe the ai would be able to do it so i don't know if it's i think part of it might be a context problem part of it might be like a model problem still where hey it can't understand a lot of context at once like i run into this where i run these really long running jobs and i start to see it get confused and it starts to forget the thing that we had been, I'd been talking to it about like two hours ago because there's so much data now.

29:01Model limitations are probably a combination of, hey, just like the models aren't good enough and the context is not documented in a way that is consumable for it. So I think it's probably some combination. And then the other thing, I think Sam Altman talks about this, where it's something about how humans have, like a human by the time they become an adult, have had so much information and training. And by the time, let's say, I employ a worker, I get all of that context. It's already been built out. Someone's already invested all this energy into feeding and clothing and teaching by the time they've gotten to me.

29:43Where with the agent, in some ways, you have to restart a little bit. And they don't have any of the contacts that you need for whatever job that you're trying. They do for some amount, but I feel like there's some level of investment that's still needed that still needs to happen, essentially. You're not hiring a newborn. you're hiring somebody that's grown up, that's gone to college, oftentimes masters, then had 10 years of experience and then you're just adding on this last module, this new experience that they hadn't had but they have all that as a bad. And they have a lot of context that the AI is not going to have.

30:18So they've worked a job for this specific role and they've learned from people that are really good and that's part of the reason we want them, right? Because they have differentiated experience from someone else and the AI is going to be the same thing. It's kind of an interesting way to think about hiring. What model training has this employee already had and what have they not? What context has that training been? It's a unique way to look at it. It's also interesting because I wonder if a lot of model selection in the future will be more like an interview where you're looking at a resume of the work you've done and is it really, really good, right?

30:58Because right now we, OpenAI and Anthropic are like competing on benchmarks that are, there are probably like five of them, right? Thinking, like, okay, you're better at thinking, but are you better at selling a product? There's probably some other model that might be better at selling the product. We'll have evidence of doing that and some sort of case studies around that. I think in the future, we'll probably have like more competition of the specific details of how good a model is versus just how intellectual it is. It's actually something we talk about for our sales team right now when we're thinking about our team and we're like, hey, this person's really smart and we hire them because they're really smart, but they lack intensity.

31:41Anthropic is probably optimizing for intelligence, right? Are they optimizing for intensity? Would you really need for someone who's like trying to go hard at a number? I don't know. That seems, that's like another quality that like is not, no one's talking about that right and so there are probably these other dimensions or other like specific pieces of context that are relevant for specific roles that yeah i think we're still so far away from i have found from hundreds and hundreds of conversations with founders and great business builders i have found three predictors of intensity and of ambition one is heavy trauma and childhood many different variations of that one is immigration or moving to many different places, having to learn a lot of different contexts and a lot of different perspectives.

32:29And third is being part of sports teams, either individual or team sports. Those seem to be the three most predictive of someone's ambition, someone's ability to be relentless in their position. It's kind of funny. Some people talk about tiger parents, especially in SF. I think a lot of my friends who come from immigrant families, especially like Chinese or Indian, it's, they're like, yeah, tiger parents, like get into the school, grind SAT. And it's funny, I tell them I didn't have that level of intensity for academics. Like I was a solid A - student always. I felt like it. In my head, I didn't really know the difference between an A and an A -.

33:13I was like, oh, it's A -, it's still an A. But what's funny is I did have a tiger girlfriend later and what i realized for myself is so many people their parents push them so hard to get into a great college and then let off the gas it's like okay i got them there they'll figure it out from there but then like a lot of these kids are so burnt out and they're like oh like that's it that was the goal i'm done or then the intensity drops afterwards. And for me, what happened, it's so funny, actually, when I was an undergrad, I dated someone who basically told me I was not ambitious enough and not good enough.

33:58This was at Purdue? Yeah, I was at Purdue. And I feel like that was my tiger girlfriend moment, where I was like, shit, well, I'm about to enter the workforce. And I had a good job lined up as a software engineer at Airbnb. I was going to make more money than my parents did, all these things. But suddenly the ceilings raced right as I'm graduating. I actually think that was pretty impactful for me where it's like, oh, you can do better, right? You're not good enough. And that happened at a moment in time where I was becoming an adult, not, hey, like get into a better school. It's like, no, the real world.

34:37Now you have to like go win in the real world. And so I think I had this, I got a great childhood. I also got the beat down at the end of undergrad of, okay, like actually the ambition level should be really high. And to be fair, like I was already ambitious, but I feel like this was fuel for the fire of like, okay, there's real world impact for not being greater than I am right now. The whole concept of Tiger parents and Tiger kids, I think the biggest tradeoff outside of trauma and not being happy people typically, which we're not talking about happiness here, is that they end up being extremely fragile.

35:14If you are so traumatized into only getting A's, you're never going to get that C. And life is about getting C's in certain areas and building up those skills. I'm just learning golf for the first time. Growing up, I thought managing money meant paying bills and balancing a checkbook. But as you know, that's only a small piece of the financial puzzle. Managing your money takes more than just checking your bank account every once in a while. And great financial decisions come from having a complete picture and proactive management for your income, expenses, and investments. Take control of your finances with Monarch.

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37:46The AI assistant lets me ask questions about my finances in plain English, and the AI Weekly Recap highlight spending changes or upcoming expenses before they become surprises. It's like having a financial advisor in your pocket. Write your own money story with Monarch. Use code invest at monarch.com to get your first year of Monarch core half off at just $50. That's 50 % off your first year at monarch.com with code invest. My first non-business hobby, I think, in my adult life. And it's humbling. But I've already gained many other business skills where I start with a beginner's mind. And that goes to that immigrant mentality is because I was born as an immigrant and because I had gone through difficult times, I was able to be humbled and I was able to fail at things and have to relearn things that a lot of first-generation immigrants suffer to do.

38:37100%. I also think another thing is seriousness is like very valued by a lot of people, and especially me as well, actually when I met my co-founder Advith one of my two co-founders Advith I mistook him as I basically valued him less because he was not a serious person in his demeanor and that was a huge mistake turns out that seriousness does not correlate in fact sometimes it's the opposite actually like being able to just like laugh about things and smile about them and like enjoy life is i actually think it's an advantage it's anti-fragile it's anti-fragile i like i used to be a way more serious person and then as i've been humbled more and more actually i have more fun with it i'm like this is just part of the rut and i think it allows you to just be more open this comes back to the very beginning where i was like okay what's the motivation behind starting the company fun and adventure like if i were too serious i wouldn't admit that to myself which would be a mistake i wouldn't know why i'm doing what i'm doing i'd have to like come up with some reason like oh i encountered this at work and therefore like this is my passion and like i'm gonna go do it actually no i just love the game like i just love building like company building is fun and exciting and my co-founders and i all agree that if you ask us, why do we do this?

40:10We'd say, because we can't not do it. We just have to do it. I've been thinking a lot since we had our pre-interview chat about this concept of building a business, fun and adventure. Why does it work? I think one of the most underrated aspects of it is honesty and how a CEO is in one part of their business is how they typically are in other parts of the business. And when you meet a CEO that says, I'm building this for fun and adventure, not to quote unquote change the world. It's just much more believable than all the other pitches that you're getting. Now when I meet founders who are just starting out and they start telling me, one of the first things I always ask them is just like, why are you doing this?

40:53Because I want to hear the honesty and most of them will not give a good answer. They're trying to be serious. And actually it's really funny. when we were in Y Combinator, Paul Graham, the founder of YC, told us about how whenever he would do office hours with founders, the founders were pivoting. He would always ask them, okay, like what other ideas do you have? And he would always say the founders would have to go through all their serious ideas before they got to the good ideas. They'd always like give their like real business ideas first of things that they feel like could be a big business.

41:32And then at the end, once they're exhausted, then they start being honest with you. And you're like, hey, is there anything else you guys are thinking about? And so the good example of this is, what was it? The Twitch guys, Justin Kahn and Michael Seibel, their whole thing, they were like building something and they were pivoting around. And so they're having one of these office hours with Paul Graham. And they go through all their ideas of the real business ideas that like make sense and will generate revenue and here's how. And then at the end, they're like, well, anything else you guys are thinking of and justin apparently says something like well i've always wanted to just like record my life like a live stream and put a camera on my head and like start walking around and everyone thought it was so funny they're like you have to do that like we were talking about this right before the podcast it's almost like the memeable thing like it catches flame just so quickly so you don't really and you don't really understand why or how it's going to become a big thing but it's just exciting and fun and that's what turned into twitch right so they start filming everything they become like local legends in san francisco and eventually they realize oh people really like watching justin game and then they're like oh maybe gaming is actually the market like live stream gaming is the thing that we should actually be building and so you like don't know that's one of those great examples i'm sure there are many that don't work out but where you are so excited about something, you just go for it.

43:02And it's like not even the serious business idea necessarily. And because you're able to remove the seriousness, you can try things that no one else would. And you get outcomes like that, which are fun, exciting. And you find like the niche that no one else is willing to go explore. My view of the most underestimated aspect of whether a team will succeed is the relationship between the founders. If you take two extreme versions, one is you have founders that don't really like each other or maybe you respect each other but don't really like each other, then they're going to try to build their business.

43:42They may pivot once, maybe twice, but likely once, and then they're going to say, well, we made our best attempt. But if you have, I've met founding teams that have started four companies together. They just love working together. They will do anything to make it work. They will forgo their salary. They will take any humble pie. They will fly to Phoenix, Arizona and talk to an engineer about their problems. There's so many downstream consequences of wanting to keep doing what you're doing with people they like to work with. It's such an underrated point and almost no one talks about it. 100%. Between myself and my two co-founders, we were friends before we started the company together.

44:20I had lived with Advith for three years. Advith and Robert had met at Caltech and they had lived together. and so we were all friends beforehand and then the other thing i had worked with other co-founders on random ideas before and i realized the why the motivation i told you fun adventure needs to be aligned right why are we doing this the what needs to be aligned because then so many co-founders fight because they're like oh i want to go this way i want to go this way for us it's like who cares which way are we going to get to a billion dollars in revenue are we going to become a trillion dollar company like who cares which market or which product right are we going to win the game or not we're playing the same game and we're aligned on the game so it's just tactics and you know so there's the why fun and adventures there's the what hey some order of magnitude of revenue and then there's also the how and the how is kind of like the style in which you like to work and operate and we call ourselves internally happy grinders this is basically like a combination of optimism and like togetherness with high competency.

45:27Call it the seven dwarfs. Sure. Yeah, you could. They're working all day long and singing. Just an example of the low ego. So part of that is also very much low ego. And when we started the company, all three of us came from similar backgrounds. We were all engineers at tech companies and no one really cared who the CEO was. I cared like a little bit, which is why I ended up becoming the CEO originally, but Adwith and Robert did not care. Like they were like, no one was fighting for titles and no one has ever, we've never, we didn't even for the first two years of the company, tell anyone who the CEO was.

46:03When people would talk to us, they would be trying to figure it out. And of course they'd find out eventually, but you'd be like, Oh, Marty, what do you do at the company? I'd say, Hey, I focus more on the go to market side of house. Right. Robert would be like I'm focused on product and design. Adbeth would be like I'm focused on post sales and engineering. And like people are like so what like and they're trying to get the title. The title doesn't matter. It doesn't matter. And in fact for us specifically we're such a hive mind between the three of us where the most important decisions, the way we come to answers on everything is we just debate heavily until we exhaust ourselves and then get to the conclusion.

46:43let's say there's some big problem in the company the three of us and now at this point relevant leaders we'll send a room and we'll just debate and it's like it's so fun it's like sport because you're really trying to find it it's like you're just trying to get to the right answer and it's fun it's like exciting and so we basically i think of it like steel sharpening steel we'll just like really iterate and go hard on each other and the thing is because there's a lot of trust you can be very direct and honest and we'll shout at each other and it's fun actually when we were first starting the company other people our first employees would hear us do this and they'd think the world's falling apart because we'd be like but if we do this like this is gonna happen and then we're gonna get destroyed by this company and like people would hear it and they'd think the world is falling apart but actually it's just how we come to the right conclusions on things we will just debate heavily until we find the answer.

47:39And then if in a session we can't find the answer, then that means we just don't have enough information yet to make the decision. So then we'll like exhaust ourselves and come back to it and talk about it again. I find in these conversations and debates, the mark of a great relationship is when you finally come up with the answer, it's kind of an obvious answer for everybody in the room. Exactly. There's mass agreement, not because everyone's trying to be cordial, but because it is the quote unquote right answer. Yep, exactly. The other thing I'd say is when building a team, the really underappreciated thing is like likability of people and like how much.

48:19You don't see that as a criteria. The question is just, do you want to work with this person? Right? Like most people don't ask that question. They're evaluating on like, and especially I think when people join companies, they don't know what they're allowed to give critique on and this is the ones one of the things i like try to remind people is like well do you like want to work with this person and that like would you work under them right like would you want them to be your manager like i just ask those direct questions and then you get the answer like pretty immediately right so for example we recently hired a GM for our EMEA region, which we're expanding into right now.

49:00And I kept asking myself the question when we were interviewing people, like, would I want to work for this person? Would I want to work for this person? Because if the answer is no, then like, who else is going to, like, we talked about this before. When we're making content, you need to optimize for yourself. And then in that way, you optimize for a lot of people. So I kept asking myself the question, I'm like, would I be excited to work under this person? Could they hire me? And then we finally found someone where the answer was yes I actually like would really like to work with this person and so in our hiring as well that has protected the team and the culture a lot because you ask yourself would I want to work with this person we're a five days a week in person culture right you're going to be sitting next to this person you're going to be eating lunch with them I like try to visualize this person sitting at lunch with the team are they going to fit in have you found that somebody that is initially unlikable but is so competent at their job that you end up liking that person no i think that we have not had that because they end up being a wrecking ball to like relationships and culture and it's impossible to contain their unlikeability we haven't actually made that mistake yet there have been moments where there are people we've interviewed who are hyper competent and clearly really good at their job but that they just don't have the qualitative side and we just need that.

50:20And so it's just like, you just have to show up every day and work with them. Right. So do you want to work with this person? Yes or no. It's just that simple. It takes away from the fun and adventure. Exactly. If you do that, then you're not going to want to show up to work and then you're not going to want to work as hard and then you're not going to want to work late. And so it just hurts everything else. It's more harm than good. You know, good heart's law that the things that people end up optimizing are things that get measured. And it's a fallacy, meaning that just because you can't measure how somebody's unlike ability affects the culture, it still affects the culture, whether or not you can measure.

50:54Right. And sometimes companies just bias on these hard skills or very hard things that you can measure and you can prove. Right. In essence, believing that just because you can't measure something doesn't mean that it's not real or it doesn't affect the company. We're going through this right now with our marketing team, because I fell into this trap where I was like. Everything needs to be related to pipeline and like measurable. And if we can't, like what number is each team member going to contribute to on the team that is going to somehow produce more demos? And the funny thing is like what's worked at Pylon for marketing has been just LinkedIn content.

51:32That's been like the greatest marketing effort we've done. And it's like the most immeasurable thing because, Hey, we get some impressions, but like, okay, that doesn't actually matter in the grand scheme. That we might have a post that's hyper-targeted that people see, and then they book a demo from, but then another post that is less relevant that like maybe more people will see, but it won't hit the buy, whatever. You can try to measure it in all sorts of ways, but it's really hard to quantify the impact. All we know is that a lot of people book demos with Pylon and they're like, I see you guys all over LinkedIn.

52:07And so like, you see the, you definitely have to see the impact somewhere. I fell into that trap for marketing where this is the first quarter where we're going back to, okay, we cannot measure some of these efforts that we're going to put in. For example, category creation on this agentic support category. We have to like put that idea and philosophy into the market. And then that will bring in pipeline. because then if people are believers of the philosophy, they'll look for the product that helps them work in that new way, and then we will be the product. And actually, this is really interesting.

52:42We think about this a lot. The best companies usually don't promote their product. They promote an idea or a way of working or a new strategy. So some examples of this HubSpot, I didn't realize this until I talked to their former CEO, they coined the term inbound. which is really interesting. So before, all of sales and demos were outbound. And then suddenly the internet comes around and you can have SEO and you can have people who search you and find you and then that's inbound. And so inbound as a term didn't exist. And so they pushed this idea of inbound and then they were the product associated with inbound.

53:27They created the category and then dominated. They created the category. In some ways you latch onto a thing that's already taking off. An example of this is JIRA. So JIRA, ticket tracking tool for project management, right? They latched onto the fact that agile and scrum, which were kind of like new philosophies on, hey, you have your to-do list and you, I don't know. It's like essentially like a to-do list philosophy and people were doing it with sticky notes and that was taking off and they became the product that could be associated with that and could be the product that actualizes like that way of working.

54:03And so they grew with that new way of working as it grew, right? Because, hey, you're bought in on Scrum and Agile being like the correct way to do things as opposed to waterfall, the old tracking way of building stuff. And so once you believe that, then you're like, okay, well, how do I implement that? And then, okay, here's the product. So your job almost becomes push the category, push the idea and then once they are bought in they will look for the product that is associated with it okay the category becomes the rationale for people to point to this is why i need this this product and if you don't have a category then it's like well there's a sticky notes thing that i think really works well and i want to spend uh ten thousand dollars a month on the sticky note it's just a hard sell to make.

54:50Exactly. And so you ideally like find some sort of trend that's already starting to happen or you introduce a new idea. So an example for us is, hey, all these people are using Claude for customer support teams to try to help them answer questions. And they're trying to like put, they're trying to build what we call agentic support. Now we're basically taking what they're trying to do, which is have AI do a lot of the support work for them we're taking it and we're giving it a name because it's everyone's trying to do the same thing just no one has coined a term for it and so we're calling it agentic support and then we're giving them a productized version of what they're trying to piece together by using claude and using skills and like custom prompts and all this stuff we are giving them a polished product that allows them to do that work because everyone shouldn't have to rebuild the same thing over and over again right And there's probably an optimized version that goes back to what we said.

55:48Every cloud skill is probably a company waiting to be built. I love that meme. Yeah. I'll give you another one for why LinkedIn could be both important and measurable. There's a famous David Ogilvie quote, one of the top advertisers of all time. He said, 90 % of all advertising is wasted. You just don't know what 90%. Right, right. And just because you can't track and just because you don't know doesn't mean that doesn't work. Right. And we've become this kind of over-optimized culture where every single thing gets measured. This is the origins of Goodhart's law is it becomes a bias now that if you just focus on things that are directly measurable, you end up very much limiting the business in its capacity.

56:29Yep. Yeah. I feel that way. On this like category creation front, it's like, okay, how like you basically just have to push content and then expect people. You create the category and then you have to message it over and over. Exactly. To the point where it's like the Kleenex, people don't know it's the business or the inbound. I didn't know that this was a term created by HuckSock. Or it's just a thing that exists that's growing. Like another example of this is Sock 2, right? So Vanta operationalized how to get Sock 2 certified, right? Sock 2 was already a thing and it was growing and people like needed to get certified.

57:03And they built a product that latched onto that. And the more they push Sock 2, the more Vanta benefits, right? customer success is another good version of this. Nick Mehta from Gainsight like really pushed the idea of customer success as a category. And then they became the customer success company, right? Salesforce is interesting. CRMs existed, but the big innovation was actually SaaS. So they were pushing a bigger idea, which is not even CRM because CRM already existed. They were pushing SaaS. So that's where they were like death to software. software sucks, SaaS is the future. And so they were pushing SaaS as the idea.

57:46Oracle databases, right? SQL databases. Push the idea, push the category, push the thing. And then, hey, the product is now available for what to actually use that thing or work in that way. That, for example, for us is like, hey, we're just going back to our roots. We've actually done category creation before. Initially, we did it for Slack support, which was already a thing people were starting to do but needed a product to solve. We built the category of B2B support, which many companies were doing support in B2B, but there had never been a B2B support product that was purpose-built for them.

58:22And so we invented this term, B2B support, and then suddenly we started hearing people say it back to us, which was exciting. And then now we just have to do the same thing, create Gentex support, which is, again, a new way of working where you move from doing the work to now just orchestrating agents that do the work. LinkedIn is a part of your strategy. How much is media in a strategy? We were talking about new media. How do you look at that? For us, we just think about where our buyers are. And so for us right now, yeah, LinkedIn has been the primary source that has felt very repeatable. I can't say that we've been excellent at other sources.

59:00We've done podcasts. We went on YC's podcast. We went on Andreessen's podcast. We went on Bain's. we've tried but it doesn't feel as repeatable for us and then we also for some reason in customer support in particular there aren't many thought leaders and i don't know why like if you look at sales there are a million thought leaders right if you look at marketing a million thought leaders if you look at customer support we would love to sponsor some people we would love to build communities around people, but I think the persona is just different and less attention grabby than others. And so we actually go on LinkedIn.

59:41There aren't people posting about customer support. It just doesn't really exist. That then goes into like, oh, us doing podcasts. We'll go on like go to market podcasts. We'll go on startup podcasts. We'll go stuff like that. But there aren't really media. There isn't really much media for our category. One of the recommendations I have for you is probably the most underrated podcast channels are these hyper specific niche podcasts. You have these podcasts where maybe even 1000 chief technology officers or 1000 chief information officers listen to this one podcast. and when they show their stats, they're like, yeah, 175 people listen to our latest episode.

1:00:25But some of these channels are so valuable, so dense in their value and also have these communities that are built. It's probably one of the most underrated aspect of media. Everybody wants to go on the large podcast with a lot of views. They like the vanity. But when you look at the specifics, for us, our podcast, we've had over$10 trillion in AUM and guests alone. We've had sovereign wealth funds, pension funds. And for general partners, it's extremely relevant to be able to pitch to trillions of dollars. And we just focus on that knitting and go deep on that. So I think these niche podcasts are extremely valuable.

1:00:59Yeah. No, it's a good call out. We did an initial search before. Didn't really find anyone. But you're right. There probably are some. You should hire and start the customer support channel. I think especially when there's a new idea. Again, we need to push this idea of agentic support. it when there's a new way of working people want more community about it they want more resources about it because it's new like no one's figured it out like if you're using zendesk everyone like the zendesk slack community is dead right everyone already knows how to use zendesk there's nothing new but agentic support we have customers asking us they're like oh are there examples of how other customers are doing this right and they like want to hear from each other i actually think one example company that did this really well in recent history is clay clay did a really good job of having a slack community early on where so many people were excited because it was so new and so they were all like talking to each other and helping each other and like coming up with ideas and they kind of like the community just built itself because the demand was there and then they just allowed they just captured it by giving them an official place to communicate and interact with each other, et cetera.

1:02:15So I think you're probably right when it does come to how do we build out the category? There's probably, hey, a podcast talking to people who have implemented agentic support or are thinking about it or who went through the transition, right? There's probably a community aspect on, hey, we started doing customer workshops or AI support workshops where everyone knows they want to use AI, but they're trying to figure out how and they really want to just talk to other people about it. And back to the point on there aren't many influencers in customer support, there's also a new conference. Like there are like these tiny conferences that are really small, maybe like 100 people.

1:03:00And there are far more support leaders than 100 people. And I see the same ones at every event. and there are clearly more than just a small group and so yeah i think maybe we should invest more there the older that i get the more i realize a obviously life is not that long but even the day there's only so many big things you could do in a day and a week and a month and you have to focus so much on building these compounding advantages for us the podcast is this network effect business. Every incremental guest brings in more views. Those views bring in the incremental guests. We're starting a conference as well for CIOs where now we could build from year to year.

1:03:43And you just have so little focus. You need to really focus on these things, especially in the age of AI, that's actually gonna compound versus something that's just gonna be disrupted by AI or continuously you wanna start from zero. The problem is a lot of these things that really compound are extremely difficult to start. You have to focus so much resources, but they start to really compound quite quickly. I agree. Looking back over the last three years, what's been your biggest mistake as a founder and CEO of your company? So I told you the greatest gift a founder can give is product market fit.

1:04:18The next best thing, the other essential thing as you start to grow is people management and managing the culture and just generally like the people side of things. I went into this role never having managed anyone. And man, I was not good to start. Like horrendous, terrible manager. I was basically operating like an ICE still doing the main work and jumping in just problem solving. You were reactive. I was reactive to things. I also just didn't understand exactly what motivated people. And also, Hadwith, Robert, and I, as an example, are all the same type of person. We're very technical. We think in a certain way.

1:05:12We don't care about affirmation. We don't care about recognition. Titles. Titles. We don't care about any of those things. That's definitely not the case for everyone. And so one of the many learnings is one, understanding the different sets of people that you will hire because there are different types of people who are exceptional, but need completely different styles of management and like want and desire completely different things. Right. There's going to be one person who's like obsessive over being a perfectionist. There's someone who, and they just want to be put in a position to do the best, like just direct product another really values recognition and this is another thing i started to realize is like man the being in the ceo position or adams and robert being co-founders like people like the ones who want affirmation and really want recognition they just want to be told that they did a good job it's like as simple as that and that was so foreign to me like it was something that like robert adworth and i like don't do i treat everyone initially like the way i treat robert and adworth right like oh let's figure it out let's debate heavily let's treat somebody else like you would want to be treated yeah exactly but turns out that's actually not correct in a lot of cases actually people want to be treated very differently than you might want to treat yourself and so seeing more examples of how people like their working style, what energizes them, what puts them in a good position to be successful at the company.

1:06:51That was a huge learning for me. And that's like really the people management side of things. It's funny. I took this to an extreme. We had an intern. She had a 398 GPA from NYU. And I just thought about, A, I need to figure out what motivates her. And B, what is she very good at? Getting good grades. So I took it literally, I turned the summer into different semesters. and I would talk about her grade and I would give her like progress reports and everything because it was this known schema. So really plugging into people's existing schemas and what matters to them is highly underrated. Totally, yeah.

1:07:26I think that, and the thing is, there are so many great people who just need, like if you can figure out how to effectively manage more types of people, you can scale your company way more because you need many types of people. That becomes a bottleneck. Becomes a bottleneck. you won't find a bunch of people that are exactly the same. And frankly, they also, for different roles, you need different types of people. And so that has been one of the biggest learnings for me, and I have gone through like a crash course on that. And now I actually would say I'm pretty good at it. I'm quite good. I think if you had asked someone who I was managing two years ago whether I was a good manager, they'd say, Marty?

1:08:10No. Like, no way. It's a terrible manager. like cancels meetings all the time, like doesn't like not paying enough attention or like guiding me in the things that I need guidance on now, I feel like people would actually say, oh, Marty's actually a really good manager. A lot of individual contributors struggle from management because at first it's so inefficient until they see the scale of it. Right. Yes, you're spending four hours a week with that person, but they're giving you 40 hours or 50 hours of work. So you have to really believe that management actually works before you start to really commit?

1:08:44This is a hard thing because I do, yeah, I do think there's a level of trusting people to present, like the ideal is, okay, you set a target or a high level goal and then they figure out the details of how to make it happen. So for example, let's say I come back from this podcast, I'm like, we need to go hard on, so for category creation, let's go harder on community building. The question is, how granular do you need to go in terms of what that means and how much of the strategic thinking do you have to do before that work then gets handed off to a person versus like for a mistake I've made is, hey, I take something high level like that.

1:09:27I tell someone who's not prepared to do that level of strategic thinking and like break it down and like think about the impact in all dimensions of it. And then you end up getting disappointed because you're like, shit, like, why do you make the decision this way? Like, it doesn't make sense. This is where I've also realized there's very much a matrix I have in my head now for each person at Pylon of it's like a skill versus will grid. And you basically should know for each type of person, if they're more junior, they should be very high will but low skill. And the way to actually get them to perform better is training.

1:10:03They need more guidance. You need to teach them how to think and operate. but they will put in the most hours and then you have the really high will or really high skill high skill and ideally their high will as well but if you see someone for example starting to be less motivated then that's a will problem right so they still have the skill but you have to push them in a different way you have to figure out why they aren't happy and that's like another lever that you push on and that figuring out that's just downstream of rapport do they trust to tell you the trust who to tell tell me to tell you their will why they're unhappy you know you know you know that they're unhappy because you can just i mean that's almost a like if but why they're unhappy why they're unhappy is really hard yeah i think usually what i'm learning is and this is the learning overall you just have to trust your gut on most things you probably already know the answer but you like don't know how to explain it i know something's wrong here but I don't know exactly how to describe it and that's a really in those moments you just that's where you just have to get into like that debate mode with that person or yourself and try to get more details like there's one person who is definitely a high performer and she was trying to describe to me why she was unhappy at the time and she said it in very vague terms that I couldn't like put all the pieces together.

1:11:33But then I heard someone else on the same team say something similar in different words and it kind of clicked for me. So you kind of know and you have to jump on these things like immediately once you start hearing about them because they will never go away unless you fix them. They only propagate. It's like a virus that spreads through the company. And so you have to address things quickly and you have to trust your got on a lot of things and the other thing i've learned is that for every team and every function you essentially have like these nodes of like trusted people and the people that you yourself should go to and use as like a sensor for that team someone you can trust who will be like i don't think this person's doing culture i'll allow the culture yeah exactly and so i've started to identify people like that across the company who really like you kind of you touch base with every once in a while and they'll give you the readout on what's happening and having that direct line they'll be honest about what's working what's not and then you like have to really trust those people and they might not have the right conclusions on what should be done about most things but usually they're right even if like they don't know yet how to explain like hey like someone might say morale's low on this team right and it's like okay well you have to dig into why that is the hard thing is so when you look at like skill versus will index the problem i found at this stage of company is that you don't have time to train people very much if especially if you're reporting to the founder if someone's like lower on the skill than you expected they're kind of done you like can't do anything about it like because even though you made the mistake in hiring them Yeah, you have to, because they might have the capacity to get better, but we don't have the capacity to train them or to change them.

1:13:29Depending on the role and especially it's especially harder when you're reporting directly to a founder who is just like all over the place all at once. And so there, I think having some sort of frameworks like the skill versus will thing is super helpful for me. and then also just moving quickly once you have like a gut sense on something something's wrong because it hurts everything and it's so funny actually the moment you fire someone usually everything gets better right away like you like the fear that first-time managers have and this is what i had this is what my co-founders had initially is like oh who's going to take over this work blah blah but turns out the team like rises to the occasion the top performers will help They'll figure it out, right?

1:14:11And then without the friction of whoever was causing problems, everything starts to move way faster. Everyone has more energy. The morale increases. Exactly. The capacity also increases. Capacity increases. Exactly. It's hard to realize it. And this is where this happens. I've seen this consistently with all of our first-time managers, which we have many, where it's not as bad as what they thought. And one of the things they get scared of is, like, what's the team going to think? Like, are they going to trust me? And then turns out this happens consistently every single time is you fire someone.

1:14:46And then immediately the team's like, oh yeah, makes sense. Like they weren't performing. Like this should have been done a couple months ago. Every time. Bring this all back. Like the people management thing is so important. And it's the next thing after product market fit. Product market fit you need, but even if you have it, but the culture sucks. and you manage people poorly, the machine will start to decay and the best people will leave, even if the company's doing well, because, hey, there are a lot of companies doing well. Like, you're not the only one. So if it sucks to work there and you hire a bunch of great people, but they're sucky to work with, or they're bad people who are not getting booted out of the company, that will kill your company for other reasons, even if you have great PMF.

1:15:32Some examples of this, Airbnb and Google are great examples of companies who I've heard stories where in the early days culture just was bad like really bad but the product market fit was so strong that it carried the company through where for example google what i heard from people who'd worked there earlier is that they were one of the first companies to be like open office like no managers they fired all the managers they're like just figure it out like do things that are valuable and so they would say like vague things like that and then there was zero direction So people in the company were building the same things, no priorities, no one's doing anything productive, but the search business was so good that it didn't matter.

1:16:17And so even though they were crushing it in terms of revenue and growing so fast, people were looking at, oh, how does the business run? And they're trying to emulate like the business practices of Google and internally it's a shit show. Like it's not working at all. And, but the product market fit and the defensibility, especially of a marketplace is so strong that it doesn't matter. You can have the worst team, worst everything, but the marketplace is so defensible that it'll just keep growing on its own. Airbnb, same thing. I think early team was really good. And then Brian has, I think he's talked about this more publicly.

1:16:54This was the start of the whole founder mode thing that he talks about where, hey, like the company kind of started to decay internally. and he had to go in and do a major reset during the pandemic. And so he kind of reset the company and put it on the right path. But for a long time, the company was not internally doing well. And it was getting really inefficient and slow. And some of the leaders they had hired were not helping the company. And so it was starting to decay. But again, the product market fit was so strong. It's such a defensible business that it doesn't matter. You just keep running.

1:17:34Well, Marty, we only got to half the questions. This has been an absolute masterclass. Thanks so much for stopping by. Yeah, David, thank you so much.