Christina Cacioppo Unfiltered on Fake Compliance, AI Security & Building a $4B Company

8:38Christina Cacioppo:have a theory but i do not know i'm quite confident they don't work at vanta okay you're not not

8:43Eric Newcomer:involved or the um that basically says you know they're like pre-filling out a bunch of forms for their customers to make to which allowed customers or suggested to customers that they should just sort of submit made up stuff basically right and then the reviewers who are supposed to be third party yeah we're like you know pretty random and not doing a great job they weren't reviewing the fulsome side of things right so what and i don't think you've have you talked about this not all right so what outside of anti yeah and i mean it is it was a me it is still a meaningful competitor to you right or um did you feel their business impact uh which like when they were competing with you for customers.

9:25Eric Newcomer:Oh, a million percent. Yes.

9:26Christina Cacioppo:Yes. Especially among startup founders.

9:30Eric Newcomer:And so what is your view on it?

9:32Christina Cacioppo:In this early stage automated compliance market, the dominant strategy is you have to build a bunch of stuff to actually automate and produce the evidence these auditors need. Dominant strategy, it takes a while to do, is you can also do it manually yourself. So the dominant strategy is you're like, hey, we're Vanta, but we're better and nicer. And we hold your hand because they're too big. And we're cheap. cheaper. And that is actually an excellent pitch. And you can do it. And then people, it's a good pitch. So people will come to you. You will handhold them through. Hopefully you're also building things.

10:05Christina Cacioppo:You can get to$10 million in revenue on this pitch. Then when you hit around, and then you can raise this big round and you can feel great. And then you kind of hit a wall because now at$10 million revenue, you've got a couple hundred customers. You've got a good pitch. So people are still coming in. And you've got these hundreds of customers you promised this thing to that you are trying to do in a way that doesn't scale and you've got all this new business because it takes time to deliver you basically sell it before

10:31Eric Newcomer:you built the capability to deliver and so you can kind of get and then you kind of hit this wall

10:35Christina Cacioppo:because then you're like okay maybe you're a year in and people are like hey you said you'd help me a year ago you said you know you're getting better than vanta but like i'm nowhere and it's your fault not mine and you have and then you're like oh shoot i should build things i should hire things but also the new business anyway and you just kind of hit this wall for like a year and you're

10:51Eric Newcomer:in a YC in the culture saying automate everything, like make it.

10:55Christina Cacioppo:But it's also just like not enough hours in the day to like hire people and build the product and do the sale. And I mean, a high class problem in startups, but like it's a real problem. I'm so confident in saying this because Vanta did a version of this. All of our like 2020, 2021 competitors did a version. Like I've just seen this movie seven times. So we watched this with Delve and we're like, oh, it's fine that they're going to, they're playing this playbook, but they're going to hit a wall. They didn't hit a wall. Kept going. And then we would go talk to founders who use their product. Rave reviews.

11:24Christina Cacioppo:It was like, I don't have to do anything. But it worked. I'm like, wait, what did they figure out? So we'd go and try to figure out. It's like, what did we miss? Shoot, we've been doing this for years. Like, what do they know we don't? And then sometime last year, we're like, oh, they're not doing it. It's fake it till you make it. But not in the sense we did, where it's like, fake it until you're building it and do things manually along the way and do your best. it's like just don't do the work and give someone a compliance report um and so what we found was they were a ferocious competitor because fake compliance with a way better product experience for a founder than real compliance it's way easier to do fake compliance than real compliance and so if it's like it's way less it's actually no work and slightly cheaper a great pitch what great so when you're selling to like who care or like who is the person that cares

12:15Eric Newcomer:about the sock to brand right or it's like it's like i'm a startup selling to amazon amazon's looking at just that i have sock to i'm looking at who did it i'm looking yeah that is vanta sock to or like what what is amazon doing when they're analyzing okay where does the actual who's reputation who has to care about reputation here to make this decision so like 10-ish years ago

12:38Christina Cacioppo:in amazon i don't literally them but it was a like oh you've done sock to that feels pretty good. And it was because it was like, it was in part the things you had to do, but it was in part just you had the organizational acumen to like do the whole thing. Like it was just kind of a harder thing to do. And so it was almost just a general proof of work. Banta and others have made this very easy. And so SOC 2 is, I think, now it is less a, oh, you must be a pretty competent organization. It's like, you did the thing. Great. Now, so often for these big companies now, It went from being most of the security review process to just the first step amongst many.

13:17Christina Cacioppo:And what often the enterprise procurement teams have done is being like, look, you have to talk to to talk to us. And we know you can get one. Don't give us any stuff about it being too hard. Now we're going to go ask you for seven more things because it doesn't hold quite the weight.

13:31Eric Newcomer:So is that an argument just for Delve then? It's like, whatever. I just have to check the box. They don't care. They're still reviewing. So we had those debates of like, is this just so you think like an economist and you draw out those forces?

13:45Christina Cacioppo:And so we had those debates. And you're like, should we do this? We decided not to. In part because I think while that is an excellent experience for a founder, you certainly lose credibility with enterprise procurement. You also lose credibility with mid-market and enterprise security teams. and if you aspire to serve both markets, you cannot do this. If you aspire to just serve founders, we were actually like, maybe this works. We don't want to play that game. And then the thing that changed was someone in March or so published a 70 ,000 word anonymous, deeply researched, very online investigation into all the practices and that just like caught fire on Twitter for a week.

14:33Eric Newcomer:And how much of your business is Sock 2 right now? And how much are you trying to make Fanta an overall stamp of this is like a safe partner?

14:42Christina Cacioppo:So we actually don't break it down by standard anymore. But I would say Sock 2 alone, actually very little now. Obviously, or like not, maybe not obviously, but often it is the entry point for an American startup. Yes, that is the first thing. But if that startup stays alive, they're adding on different frameworks, they're adding on different product areas. and one switch we made over the last four years is talking much more about the product in general

15:07Eric Newcomer:and its feature set versus just a Sock 2 kind of for the reasons you imagine right now there's

15:12Christina Cacioppo:lots of ways to get a Sock 2 we can quibble about quality but to your earlier question the dominant brand is Sock 2 it's not Audit Firm Sock 2 or even Vanta Sock 2 while I would like it Sock 2 has a ton of brand stickiness itself.

15:26Eric Newcomer:And for SOC 2, do you also use outside auditors? Like is Vanta giving, why doesn't Vanta just give the stamp instead of outside office?

15:35Christina Cacioppo:Well, per SOC 2, you can't, you basically, you can't audit your own work.

15:38Eric Newcomer:Oh, because you're helping them do the work.

15:40Christina Cacioppo:We are helping them do the work.

15:41Eric Newcomer:Right. Yes.

15:42Christina Cacioppo:So we have always worked with outside auditors. Again, early in the company's life, we had all these debates and had the, you know, it's like, why can't we just be the auditor? Maybe we, you know, get some friends to start an audit firm. That sounds good. And we're basically like, it sounds good in the short term. And that looks terrible in the long run. And it kind of doesn't pass the front page test. And so don't do it. We've had competitors who've done all of our, like have the friends started, have the former employees started, whatever. But we've just been like, that doesn't, if you're playing the long game, that will not work.

16:13Eric Newcomer:And so just to be clear, do you think Delve behaved unethically?

16:16Christina Cacioppo:Yes. I think they told their customers, we are implementing security practices for you. And they were not. And I think they, or rather, I don't know, the Substack suggests they knew the auditors they were working with were not rigorous in looking at all of the things they should. And in response to knowing that, sent them more business.

16:40Eric Newcomer:And now I've said, okay, we're going to try and clean up our auditors maybe a little bit. Yes. Have they gotten away with it? I think no.

16:50Christina Cacioppo:And just like, I mean, I know what percentage of their, you know, call it February customer-based Vanta has.

16:57Eric Newcomer:You had a lot of customers say, oh, no, redo it for us? Yeah. Or we're in the process?

17:04Christina Cacioppo:We maybe thought we did it. But just like those days, I mean, like so much new business. It was just like immediate exodus. and so I don't you know I this seems like not the brand to try to rehabilitate in the space to try to do it again I think those founders could go build something else very successful in another

17:26Eric Newcomer:space a very different company one that likes to do everything uh Rippling is now running its sock to what I don't know have you seen them in the marketplace we actually I mean we certainly saw

17:36Christina Cacioppo:the announcement um and I think they are I mean this is not I think everyone thinks they are aggressive and ferocious and not to be underestimated. We haven't seen them much yet, but we understand they are aggressive and ferocious.

17:51Eric Newcomer:I want to zoom out and just talk security for a minute because AI seems like it could be sort of a total nightmare for security. It empowers every rogue actor in the world with intelligence to fire up and create voices. to so many new vectors of attack. What do you see and what are you recommending that the startup world does with this new AI vector of attack?

18:19Christina Cacioppo:Yeah, I think it's... I think, maybe to state the obvious, it's going to be really interesting and fun on some level, but security overall is just this... One of the things that drew me to it is this kind of cat and mouse game where both sides are quite smart and sort of an ongoing competition. And I think these models, well, we can talk about whether they will, you know, send us all into like UBI land and make us all potatoes or something. They seem, you know, quite good at finding vulnerabilities in code, at least like as a discrete statement. And that is something we will like all have to grapple with.

18:52Christina Cacioppo:And so I kind of do subscribe to that. I think even if you are like an AI maximalist, security companies, cyber companies, more important in the future, not less. AI is like this huge tailwind for them. And I think actually to your founder point, I think founders will have to care about this earlier. in part so they don't, nothing happens and, you know, they don't become a bad Twitter headline. In part because I think enterprise procurement teams are going to push on them because the enterprise procurement teams or enterprises get the how worrisome this is. They will push it on procurement. Procurement will push it on the founder.

19:27Christina Cacioppo:So I think that's the other vector, whether or not the founder kind of intrinsically thinks about this.

19:32Eric Newcomer:The AI of it all. How much do you find like leverage for your own business?

19:37Christina Cacioppo:so much okay so much so much i think twofold as someone to be clear who started this conversation

19:43Eric Newcomer:being like oh the ai hype is out of control people are yeah i think i just say that to contextualize for the listeners ai skeptical that this is coming from someone who sees

19:53Christina Cacioppo:some of the over exuberance yeah i would say like in the market i mean also in tech but like in the market yes some of that of uh over exuberance is a it's a nice word for it also i think parts of the tech are real. And I think it's getting, and the parts that aren't, some of them are getting better very quickly. So I think betting against the tech getting better is rather silly. It's like betting against San Francisco a couple of years ago, like rather silly bet. But yes, I think a couple of things. So one, we see a tailwind and we've seen a bunch of acceleration in the business because there's more startups being created.

20:29Eric Newcomer:So some of it's just customers. Exactly. Customer creation.

20:31Christina Cacioppo:You know, like everyone cites, but the best we have, like this publicly,

20:35Eric Newcomer:the Stripe Atlas stat of twice as many companies

20:39Christina Cacioppo:founded in January, 2026 as January, 2025. I'm like, well, they all survive. No, but like 2X on your baseline is pretty good. So you see that a lot of the compliance workflows are pretty manual and workflow based. And so there's just things we can automate now. We couldn't have two, three, five years ago. And that is very cool. There's product experiences we wanted to build. We couldn't, we can now build. great and then the other part of it is well exciting ai it's also very scary especially to enterprises and like what are the models doing what are the agents doing with what data what the heck's going on and that just like that scrutiny is like right in those questions are like right

21:20Eric Newcomer:in vanta's wheelhouse are you having engineers come to you and say you know extra like potential customers and say oh i'm just gonna ask claude like make me sock to comply yeah we've done that

21:29Christina Cacioppo:too yeah yeah so yeah and we actually every what are we doing probably once a month we'll like try to rebuild vanta with cloud from scratch just not that we're probably going to use it once it's possible you know or exactly exactly you don't want someone else figuring out exactly um and there's a bit of rebuilding software is still hard i think the places where at least internally we've seen we are much more likely to rebuild software and do it well is when the process is fully internal. It is just, it doesn't touch a customer. It doesn't touch a partner. It doesn't touch an auditor. It doesn't touch a regulator.

22:03Christina Cacioppo:It's super internal. Those are the places where you're like, we've experimented. We have some stuff. We've done some stuff. I think talking to folks, those are the places I think when it touches regulation or audit or a place where like you want to be correct all the time, that's when like, yeah, maybe you can build some version, but like do you want to maintain that and ensure that right because when you worry about regulators

22:26Eric Newcomer:and compliance it doesn't matter just what the output is it matters how it got there exactly whereas when it's just internal it's like ticket that your team has filed to get access to

22:36Christina Cacioppo:big ma whatever pick your favorite cloud whatever pick your tool yeah like what are what are sort of

22:44Eric Newcomer:the next stand what are the stand what is the next talk to or what are the other compliance standards

22:50Christina Cacioppo:There's a host of – so the other big – so, okay, SOC 2 is done by the American Institute of CPAs. Started in the U.S. We've exported it, like we've exported lots of American culture. There's a Swiss standard body called ISO, International Standards Organization. They do a set of standards. I think a lot of these standards bodies are professional associations or nonprofits. They're basically communist standard setting bodies. We've got to get everybody on the same page. and then it's just hard to respond to technology quickly with that.

23:21Eric Newcomer:So some of them are flawed. You're not embracing them?

23:24Christina Cacioppo:No, I mean, we are. But I think it's just like they have deliberative bodies that purposely – they're like the U.S. legislature. You're like, there's a reason this is large and has lots of constituents and takes a long time and that is a good thing baked into our founding principles.

23:38Eric Newcomer:But when you talk about you want an agent standard, let's talk. Right, is that happening? Are you going to do a proprietary one?

23:45Christina Cacioppo:I think that like it's on to the audit your own work. What if it's just a Vanta standard, what at work? Like your team customer.

23:53Eric Newcomer:That's yeah. That continues to be the posture.

23:55Christina Cacioppo:But one of our PMs has made a like agent runtime monitoring standard that we actually gave to the cloud security alliance. But like consortium of cloud tech, cloud security tech companies and truly gave it to them. But of like, here's an agent runtime standard. you all are in a much better position to push this than we are um that's called arm a-a-r-m and so there's like things like that that i think we will continue to do but we will not i think i'm not sure i understand why the vanta the business wants the vanta standard i'm not sure that solves problems for everybody else i don't know if this is too far field from what you do but i'm very interested in this problem that we don't have yet really right now

24:36Eric Newcomer:but you know agentic commerce yeah this idea that i have an agent you know i one of my cerebral valley co-hosts max i think had a claude bot like bidding on a wine auction site on his behalf and lucked out that it didn't way way overbid only like a slightly overbid but you know we're empowering these agents or will be soon and can now to spend money on our behalf like that could unlock like a ton of spend because they're like you know it's like oh it's sort of a buy first question later you yeah it's very obvious how you open up a new spending avenue when you have an agent spending on your behalf like who do you think governs that or do you have any sort of view like do you play any role this is far from what you do or kind of I mean I think to that

25:23Christina Cacioppo:like one of the tough parts of all of that is these things are non-deterministic which we all know but it's not like you can like stick a bunch of lines with capital letters and exclamation points in your agents MD or your cloud MD and then it like won't bit up all the way. Like, I don't know. You can suggest it doesn't bit up all the way. Right. And so one of the things we've experimented with internally is like, how do you how can you insert deterministic guardrails in some of this? And it's actually probably not the prompt files, because, again, those are at the end of the day, best efforts.

25:51Christina Cacioppo:And so we've played with this around consent, like agents that ask for consent and agents that collect sensitive information or like credit card numbers or these places where You're like, there are existing obligations to keep this stuff secure. You can tell your agent not to accept a social security number, a credit card number. But it might. And how do you think about determinism there? And so I'm like more optimistic about that, given, again, given how all the prompt files are like best effort.

26:19Eric Newcomer:Feels like we're going to have to, we'll change norms too. Yes, I think that's true. There'll be sites like if Amazon accepts agents, they'll let me unwind some of that. because Amazon would obviously benefit from the sort of like willingness to just like

26:32Christina Cacioppo:you want a white t-shirt? I got you 17. Sure, great, great.

26:34Eric Newcomer:And so if like a larger percentage of customers return them than already, they're probably okay with that to take the increased spend. So then we just evolve new norm. Does that world feel close? Or do you think I'm too AI-pillied here?

26:47Christina Cacioppo:No, I think it does feel close. I think we're starting to see it in some of like the AI assistant sort of things. yeah where you want to send them off and i think the um we related to the wine thing but the one thing i built for myself it's very silly is like there's a couple like specific products where you're like okay if stuff like this shows up on ebay like tell me immediately and i don't want to check ebay every day and ebay alerts aren't you know i don't want 17 ebay anyway you want to tell us what category this is or oh it's close it's like maybe not maybe i'm surprising i thought it's gonna be pokemon cards you know no it's like very specific like vintage clothing um which cool but like there's there's definitely price thresholds right like just buy the thing like don't let anybody else buy it if you find it yeah right totally what you know you you worked as

27:37Eric Newcomer:an investor briefly yeah two years it was early stage yeah it was union square venture so it's

27:42Christina Cacioppo:like cna yeah the best of the best early stage yeah what i mean prestige brand the uh investors

27:49Eric Newcomer:I guess are culpable for some of the media that we're seeing right now. Yeah. I mean, let's, let's, you know, usually I ask VCs to talk endlessly about founders to have a founder. What, you know, talk about the VCs a little bit. Like what, there, there's so many trends happening. One, I mean, there's this rise of like the mega funds from the founder perspective. Like how does that change your life?

28:12Christina Cacioppo:It's funny. I actually think it, um, sorry, I was an inventor 15 years ago. So I got one old, but like two, so long ago, and I think over the last 15 years to the mega funds it's like now almost everyone is playing an AUM game an asset center management game right it's a mega funds and you're like well first you've got to raise them and then you've got to deploy them and the faster you deploy them the more you can get another and then like fees off of that and while most I think firms aren't so craven to like just think about it as fee maximizing that's like definitely a powerful economic incentive like the faster you deploy the faster you can raise another one and so there's just like the amount of capital in silicon valley philosophically not just like the geography that's how i use it is yeah the geographic version of it or sorry uh not that the philosophical version of that is like so much greater than 15 years ago and so there's like one there's capital everywhere you know again when i was at i mean it's like so cute to think about the rounds when i was at usv which right before I got there, it was like$1 million on$4 or$5 million seed rounds.

29:17Christina Cacioppo:And then when I got there, it was like three on 10. What even are these numbers now? But because there's so much money choosing so many things, you can get funded. I think everyone's incentive is for you to raise larger and larger rounds again because of the assets under management. I think you've seen a lot of these. What used to be an artisanal game is now a financialized profession where they are bigger firms. They operate more like a Goldman Sachs than an Allen & Company. It used to be a bunch of Allen & Company equivalents or these boutique-y artisanal things.

29:56Eric Newcomer:Would people say you still pick based on the partner, not the firm?

30:01Christina Cacioppo:I think you still should. I don't think very many people do, but I think you totally should.

30:05Eric Newcomer:but they behave like goldman it's like one comes in one comes out it's like the firm yeah backs you i mean for you it's i guess all that capital is great because they're creating new customers yes bad these are creating new competitors yeah i assume i mean some of the

30:21Christina Cacioppo:companies some of that talked about i also think just i mean i'm probably too i think i'm too like pollyanna-ish about this because making money has always been a core part of silicon valley and you You know, all the critiques I'm about to say, you could apply to 1999 too. But I do feel like there's something of a social contract that's just broken or different. The old Silicon Valley social contract was you join this company, you get equity, we will all be rich together. And that was different than the East Coast semiconductor firms in like the 70s. And it was different than finance or consulting, you know, 10 years ago, 15 years ago, whatever.

30:58Christina Cacioppo:and I think we've seen now a handful of acquisitions that are like oh you're at equity in the company

31:04Eric Newcomer:right all these aqua okay people call them aqua hires but they're like license and poach deals

31:10Christina Cacioppo:basically where and I do I mean again straight Pollyannish also probably I live in a glass house so you know I'm gonna regret this but like those are just feel like philosophically different and a bit of like that's why the trader estate left shockley semiconductors because they didn't have economics in the thing and like they they and like a handful of east coast or like west coast venture capitalists started silicon valley in like 1970s sense and it feels like we've now kind of forgotten some of that and it's like oh i'm the founder i get it right well there's a

31:42Eric Newcomer:funny evolution so one it's like we have old school venture capital which is clubby yes stage financing it's sort of like it's fair it's like the the stage financing is good because it feels like you you have to prove your business along the way whereas right now firms if they just want to deploy capital they just sort of keep investing in their own companies yeah there are these lessons that sort of doubling down on ownership is the way to win um like the progressive quick

32:15Christina Cacioppo:financing right to make you seem like a winner ergo you're a winner which i think is not wrong

32:19Eric Newcomer:like that logic might not be wrong right yeah the i i feel like the next wave is just what the sort of small business or like the three-person business that raises very little money and uses sort of ai tools okay i think that i really like that vision who's doing that today though it's like all a story yeah i feel like well i mean mid-journey is the sort of the best example of refuse to raise funding. Yeah, I know.

32:47Christina Cacioppo:I'm sure they made a lot of money. Yeah, that's fair. And now they're exploring other things.

32:53Eric Newcomer:So I think they did pretty well. I don't know how much it's like, not by venture capital standards, but they don't have to play by that same game. I think there was that famously, the New York Times did a profile of

33:05Christina Cacioppo:the one person business.

33:06Eric Newcomer:It was then secretly a two person business that then it seemed like it was pretty made up. today yeah yeah so our i guess archetypal example was potentially right fake which is i guess very of the ai moment yes exactly yes so yeah you don't you don't feel like looking at your like

33:25Christina Cacioppo:friends in silicon valley that's a true story no right no um but i kind of wish it were like the businesses that uh i think that stuff used to get derided as lifestyle businesses and those are kind of like, oh, you're not ambitious.

33:40Eric Newcomer:You're running a lifestyle business.

33:42Christina Cacioppo:Where I think often it was like, oh, you're just running a proper business yourself and you own 100 % of it and you control your own destiny and make your own decisions and can pull out millions of dollars a year if you want. You're like, that's actually a nicer dynamic than...

33:54Eric Newcomer:I run a lifestyle business not to pull millions of dollars out of it a year, but yeah, otherwise I'm... But yeah, okay.

34:00Christina Cacioppo:You think about like where your situation versus like pick your growth stage founder, you know, different problems. But like it's not obvious to me the gross stage founder has it any better than you do. Although they get more. I don't know. They could probably get invited on more podcasts.

34:13Eric Newcomer:Oh, you just host your own. There you go. That's your constant. Yeah. I don't know. They're, you know, media is just like I've never tried to fundraise. I sort of like had the advantage of the sub stack paid a better salary than Bloomberg. Eventually I had money where I was like, oh, I should spend it on have an employee make my life better, get the business a better place. Then we figured out events. So you hire a few more people. It's always had this like logical, somewhat linear type growth, you know, up and down. Not the type of thing you'd tell some amazing story. I'm like, invest in me. And then just raising capital once you own all of the business to sell like 10%.

34:53Eric Newcomer:Yeah. It becomes like, why? Right now I don't report to anybody.

34:56Christina Cacioppo:Yes.

34:57Eric Newcomer:Then I report to you for like a little bit. Like it just like so it's never really made sense.

35:02Christina Cacioppo:Yeah.

35:02Eric Newcomer:Besides the like sometimes envy it media companies that raise money. So they have a valuation. Right. Oh, this is a big deal. You know. Yeah. Yeah. And I guess I you know, I I don't know. I'm learning this as I go. Certainly. Yeah.

35:14Christina Cacioppo:Do you feel like it hurts you in attracting talent, even if competing against media companies?

35:21Eric Newcomer:That's a good question. I'm sure I'm sure it does from like being like semaphores or it's just like I think, I'm attracting sort of people who specifically get what we're doing. I mean, some of it, I have sort of a mix of people who came up through the business, people I had deep relationships with who sort of got it. And then I think our two newest hires, both were sort of like venture ecosystem. So in some ways, they got what we were doing more than necessarily were purely chasing like the best media opportunity. yeah so i do think in sort of what you know i want to be sort of really strong in startups and venture capital yep and so less in sort of like a media ego game and more people who really get venture and so then i don't know that it matters a ton but it's an interesting question

36:14Christina Cacioppo:yeah that would like i think people would say things about it but again in reality does it like for your does it hurt for your people like i feel like the fault of like the software engineer

36:25Eric Newcomer:is that they chase high valuation companies instead of companies that see upside. And so in some ways, that's sort of the inverse of what you're talking about, which is like, well, they could make the mistake of seeing that you're really established and legit and therefore... You want to join like right before

36:40Christina Cacioppo:the big fundraising round, not right after, but everyone joins right after.

36:44Eric Newcomer:Right. And that's just like always the case.

36:47Christina Cacioppo:Always the case. Yeah.

36:48Eric Newcomer:Yeah. I mean, what is your recruiting strategy today?

36:53Christina Cacioppo:It is... For engineers?

36:55Eric Newcomer:Or just, yeah, for sort of high leverage roles.

36:58Christina Cacioppo:Yeah, I think a lot of it is in this AI moment, the people or the companies that win will have distribution, product market fit, demand, and like a bunch of data to use as private tokens and do things that like the models can't. And turned out Vanta has those things by virtue of having 16 ,000 customers. And, you know, you pick your...

37:21Eric Newcomer:Do you sell them on why this business is sort of differentiated and why they should bet on this case? And so it's that at a business level and then on a product building level, again, you're like, here's this domain that might seem sleepy and boring that is so amenable to agents.

37:38Christina Cacioppo:Come build them here. Again, with the private data, the private tokens, like with a team that is like running evals and like doing the things like come do that here.

37:49Eric Newcomer:Do you want to be an accounting firm?

37:51Christina Cacioppo:uh no no what is like financial accounting yeah no well i just think of areas where agents are

37:57Eric Newcomer:sort of independently doing compliance that people are yeah i think we have our own parallels in like

38:01Christina Cacioppo:it accounting it attestation that's what it's actually called but like those ideas applied to like a not security domain but not the money right security we're not going

38:11Eric Newcomer:to go compete with right yeah what did digits and yeah it's also just like a very to the

38:15Christina Cacioppo:enterprise it's just a very different buyer like we're like cso org cfo is right whole other ball

38:20Eric Newcomer:game we we'd gotten into the investing piece i mean in the news talk about an early stage prestigious firm i mean benchmark yeah now i think the wall street journal um is saying that they're raising a growth fund i'm curious like yeah it's just like everybody's accepting this world of like mascot yeah usb might be the last uh sort of elite holdout i'm sure there are other i mean what

38:42Christina Cacioppo:like i don't know what forerunner's doing but i think of them i mean forerunner always had but

38:46Eric Newcomer:They had like bigger funds. Did they? Okay. Yeah, yeah, yeah. I think they certainly had billion dollar funds. I think their earlier stage funds did better, but you know. Yeah, yeah. I mean, there are people like Bloodgate. Like to some degree, I don't hear about them. I don't know where they've made this for Next Generation. I just like haven't. Pivot.

39:03Christina Cacioppo:First round?

39:05Eric Newcomer:Oh, yeah. Have they gone bigger?

39:06Christina Cacioppo:I don't know. But I was just trying to think of like. Oh, yeah, yeah. First round, I think, is hold out. Like who's in this cohort. Yeah, exactly.

39:11Eric Newcomer:So what do you make of Benchmark, allegedly?

39:13Christina Cacioppo:Oh, I think it's, what do I think? I think, I don't know really anything. No, you're like, you know, I know two bots. Anyway, so like classic VC over here, we're pining on stuff they don't know, back at you. But I do, I guess, kind of read it a bit as we tried to not play the AUM game and it doesn't work. And maybe it's a, and I don't know if it's a, Like we felt like we compete and win founders approval or they'd want us to do the deal. And then it would fall apart because they would get a because we couldn't write the check size. They want it. Exactly. There's so much money. And it's like and we and we still want to lead deals with founders we like.

39:58Christina Cacioppo:And so you've got to write bigger checks. You've got to have bigger funds.

40:01Eric Newcomer:Right.

40:02Christina Cacioppo:I mean, that's just like the surface.

40:04Eric Newcomer:For a long time, to the extent you can hold on and say we're benchmark. We have our unique terms. right it's a great model like you want to hold on to that for as long as you can because then you're getting ownership at a better price and then people quickly also there's like again all

40:18Christina Cacioppo:of silicon valley is the status games and there's a status piece of that it's like we don't have to

40:22Eric Newcomer:compete on everybody else's playing field yeah so good i did a piece six six months ago yeah i mean they were down to you know three guys peter fenn eric vishra and chayden putiganta um you know And it was pretty negative for like a great firm. I mean, I said in the piece that like.

40:41Christina Cacioppo:There were some good tweets of that era.

40:43Eric Newcomer:I mean, yeah. Well, I think I'm getting ahead of like the like benchmarks doing just fine. I think my point in the piece, first of all, was that like LPs, you know, always make sense to invest in benchmarks and they would do very well. And certainly I saw that Cerebris like was a good investment. I don't think I knew it was like going to be the level that it is, but still. and I will say on the Cerebris front it was outside of the typical benchmark behavior it's hardware even they raised a standalone set of money to invest in it that was a growth deal before this growth fund anyway so now Benchmark more than half a year later has hired Ev from KP they brought on Jack Altman so now they are back at 5 yeah they're back And, you know, my whole point in the piece was they were holding on to an old strategy and claiming the new partners run the firm and it's a dynamic firm.

41:39Eric Newcomer:Yep. But not letting the new partners reinvent the strategy. And so clearly now they brought in these new people. Ev, you know, has a background in growth investing. He came up through Bond. Sorry, Benchmark is the ultimate. Like Silicon Valley really is a small world. You know, you've met many. You know these people. Like it is. I mean, do you miss? I mean, is it still a small world? Do you miss it? Like at once I was sort of saying earlier that like the old venture model, you know, is elitist and a closed club. But there's something nice about the community

42:11Christina Cacioppo:where sort of people have reputations,

42:13Eric Newcomer:people know each other. And therefore, if you're a bad actor, your reputation matters. Where in this world, it feels like -

42:18Christina Cacioppo:Does that always happen in venture?

42:20Eric Newcomer:No, yeah, yeah. People were dicks back then. You're right. Now Andreessen would say, you know, we have to be more founder friendly where it used to be. I don't know. What's your view on this sort of small world of Silicon Valley?

42:31Christina Cacioppo:I think – I mean, it definitely is a small world. And also San Francisco is a small village, not a city, you know, a small hamlet. And, like, everyone knows everyone. And there's parts that, you know, it's like the great and terrible parts of that or everything you'd imagine. There's not anything interesting to say. I think the parts of venture that are compelling is done right. It's a really like intellectually interesting job because you're just like learning about new stuff, trying to figure out which way things are going and applying that. You get to talk to smart people all day long and you get to bring them in and be like, I don't know anything about, you know, chips.

43:07Christina Cacioppo:You explain it to me. Hopefully you're slightly more elegant than that. But like then they do. I think it's like being a journalist in that.

43:13Eric Newcomer:You get to sort of learn everything and get excited about other people's business. Ask all the questions you want and be able to answer them.

43:17Christina Cacioppo:It's really cool. um i think there are definitely parts i struggled with was they're not teams like it's not like a soccer team at best it's a swim team running relays but like you are in the pool alone right even at the most teamy firms it's like investing and all these venture firms have like fucked up dynamics they're all like yeah yeah they are like it's funny they're like yeah someone gave me this 10 15 years ago they're like your uncle's small business if you have uncle's but whatever it's like your, you know, hometown small business. They just happen to manage$3 billion. And then like, but it's like the uncle small business or hometown small business dynamics with$3 billion, which then it just creates.

43:56Eric Newcomer:I feel like we're seeing the path not taken or the psychology here is you're like, oh, this was the other life that I did not pursue. Like, do you think, like, was Vanta more successful than you thought? Or like, there's a world where like, you're like, oh, no, I know. I just, no. just like there's a world where it's like oh i've been a vc i feel like there are all these vcs

44:16Christina Cacioppo:are like i should go build a business and then it's freaking hard but then you're like oh man

44:21Eric Newcomer:i built it like a real business people are excited about or like yeah how does it is it has has it gone sort of as you imagine i don't know i think it's like you probably have a version of it both

44:31Christina Cacioppo:you both like when you start these things you're like yeah definitely it's gonna work like otherwise i would like go the other path but like um i got this and then personally being like statistically no one has it. You know, statistically, these things don't work. And both are true at any point. And so it's like kind of balancing those two. I think a thing I've done is I actually do really like the work of company building, which one I'm just I feel very lucky for because it's like infinity work.

44:58Eric Newcomer:Like the team part of it?

45:00Christina Cacioppo:I like the team part of it. I like the, you know, where like Vanta is both doing fantastically well and there's 9 ,000 things that are messed up um but there are 9 000 different things than used to be messed up it's kind of there's always 9 000 things but they change and that's actually what i feel really lucky for because i think the like insanity and i hate this and burnout is when it's like no it's it's broken

45:24Eric Newcomer:in the same way and i've tried to fix it and i can't exactly and that's when it's like forget this i feel like that's what i'm learning right now it's like okay you can have problems they can't be the same problems like if you have the same problem you need to solve it or something's not working yeah yeah there are different problems that's good you're growing changing you know

45:40Christina Cacioppo:whatever totally and it's like don't measure how many problems there are because you're always 9 000 like that you're just gonna lose um but i like do so do the path not taken like a little bit but i actually really like the work right um you know i find it like hard and rewarding and interesting and it changes and i get to learn a bunch of stuff and like i'm only sort of good at it and i get better than it changes and like i really like that christina this was so so nice

46:05Eric Newcomer:to have you on the podcast.

46:06Christina Cacioppo:Thank you so much for having me.

46:35Eric Newcomer:with Max Schaoud and James Wilsterman. Otherwise, probably see you in about a week. Thanks for all your support. That's our show.