EP 64: Jay Simons (GP, BOND Capital) On How Product-Led Growth Turned Atlassian into a $40B Company

26:23I actually want to throw as many people through the funnel as I possibly can. What about, I mean, was the org actually fully distributed-ish? Or how was the headcount actually laid out? It was when I joined two-thirds in Australia, a third in San Francisco. Going into offices in both? Oh, yeah, yeah. Okay. Yeah, I mean, like a very office-bound culture and company in the early days. And then, you know, I think Atlassian has always been like a very distributed company. And so I think it's sort of a distant cousin to remote. And then, you know, the nature of our products kind of meant that it was very easy for Atlassian just to become a, which it is today, a remote-only or remote-first kind of culture.

27:04But, you know, we expanded to sort of like pockets of concentrated people all over the world. And so to work, you were just kind of online, you know. Now, I've had a play at Atlassian for a generation of founders that think that they can operate without sales in some ways. Like, and obviously was the grandfather or forefather of product-led sales. Where do you think, do you think it makes sense across the board? I've seen a lot of founders just bang their heads against the wall over and over again, trying to get PLG to work, trying to get that motion to work. What is your heuristics or how you think about like where it does make sense?

27:43And so maybe the answer is everywhere and you just need to keep banging your head against the wall versus where it doesn't. Are there defining characteristics that you think? There's some. I think it works best in a really big market, really big TAM, where that TAM is comprised of lots of units, lots of customers. Like if my TAM is massive, but there's only 100 customers for my software product, not a good product-led growth setup. If I could acquire 100 ,000 customers, that's a good product of growth setup. Because if you just think about the rate limiter on acquiring them, well, if I'm going traditionally with just sellers, the rate limiters, how quickly can I hire sellers?

28:23How effectively can I on-ramp? Like all that sort of stuff. And so you're kind of limiting your rate of growth into that TAM by a human capital constraint. I think there's some ingredients of the product that are better fit for product-led growth. If I'm selling kind of a general ledger or a single sort of like big HR management system, it's such a carefully considered system by a small group of decision makers that you don't really need product-led growth for that. Now, you could kind of lower friction for consideration, get maybe a product-led lead generator, but you're not going to really kind of land and acquire those customers for a really considered choice.

29:04I think, you know, we had the advantage early on of a very cynical user persona and a developer. And so you see a lot of product-led growth kind of business model building around developer tools because developers are self-sufficient. They kind of know what they want. they're skeptical of products that need to be explained to them if they can't kind of use it probably the salesperson is going to be less technical than they will so what value do they really get just like get me into the product let me use it if it does what i need to do the product can can do a good job of kind of explaining itself but i don't need a i don't i don't need another human being to explain it to me i'll figure it out on my own and so that persona is sort of like naturally more wired for product-led growth i think um And products with built-in network effects, some dimension of reality or collaborative capability, like Figma is an example.

29:58It's sort of like one person is going to bring it in, but I'm going to kind of light it up and turn it on for the next 100 to 1 ,000 people in my organization. And that kind of product-led expansion model feeds in maybe to an opportunity for sales to transact or convert a larger expansion opportunity because the product has sort of like earned it. those are some of the ingredients. And then, you know, naturally, I think if you pricing, not just price transparency, but absolute price is kind of a factor. I mean, we chose to price effectively just above free. I mean, and by design, we priced below the 10, you know, the 10K kind of purchase, formal purchase requisition workflow that exists in most companies where I've got to go get my boss's sign off and approval.

30:42And I got to think about sort of, is the budget here? Do I need to go argue for it? Below 10K or probably 15K today, most people can just on a discretionary basis, just sign up for something and spend it. When you get above that, there's just some human navigation that you need to do. And I think if you're priced at hundreds of thousands or several hundreds of thousands or millions, you probably need some more solution selling. You need to explain, like, is it really worth it? Like, can I translate the problems that you're experiencing with the value that my product is going to bring? That's actually like true value selling.

31:18And that is, you're not going to find a lot of that in product-led growth. And so I think it's a combination of all of those things that sort of yields the ability to build a model. But I will say last thing is like, there are some trade-offs, you know, like Atlassian, Atlassian never was never really the famous triple, triple, double, double, double grower, you know, where you're You know, by the way, we, uh, we, uh, I'll interrupt you for a second. My first couple months at battery nearage agar wall, who was my boss at the time, wrote this framework and we tried to come up with what we were going to call it.

31:50And, uh, and it's funny cause now it's just like become triple, triple, double, double, double, double T two D three. And it's like spread in the industry and no one really knows the root of it, but it was like my first month on the job. And we were like, should it be two T three D? and we were like debating the, and I feel like it's actually rotted some people's brains about like, this is the only way to grow a company. And I feel I was 1 % like in it. I just helped come up with the moniker, but it's just funny. Everyone followed this, like this is the gold standard of how you have to build enterprise software companies is T2D3.

32:22And Alassane is a perfect example of like, no, you don't. We didn't. And by the way, it was by design. Like we had all these tense debates kind of internally around, not intentionally constraining our growth, But like the way that we were designing our business model and the way we were designing how we were acquiring market share and growing into our market made it almost impossible to grow faster than 60%. We were just like, we would have to do different things to do that. We understand what those are. Part of it would be we could have earlier tilted our pricing curve and gone after like the Fortune 1000 or the Fortune 500 with, you know, with ASPs or ACVs in the multi-hundred thousands to millions.

33:02We chose not to do that. So we're like, without that, we're probably going to grow between 40 and 60 percent. And that's actually OK. And so I think, you know, in some cases, like you're choosing, you know, you're choosing slower growth at kind of a small base, potentially for a more durable long. long i mean the the you know what's remarkable about atlassian is it grew between 35 and 50 percent for like 15 straight years which compounds a lot of value huge amount of value and you know we always used to use uh even though it may not be a fair example but we we kind of pulled um 15 years of historical uh growth in in amazon like amazon's growth for the first 15 years looked remarkably similar to Atlassian.

33:50So this is pre-edited AWS, where all of a sudden it was like just the adrenaline shot that just like, you know, like makes everything kind of look wonky. But, you know, the argument that we were trying to make is like, you can be a durable compounder that just predictably grows every year between these bands. And like, how does that add up? And by the way, what are the other trade-offs is like, we became, we were just such a capital efficient business, right? We were profitable. And so like we were compounding, you know, like cash in our own bank account every year, like without sort of building without dilution, you know, and, and, you know, like we could fund anything that we wanted to do eventually.

34:30And that's just a very different business. It's a very different way to build a business, but it also yields a very different. There's a natural rate of absorption in a market for a lot of companies, right? And there's also like some elements of prisoner's dilemma of what your competitors are doing. And Uber versus Lyft, a great example of sometimes you have to play the game on the field with all of that. But like, if you don't, you can you can control your own destiny at the pace of what the market's willing to take. And also, if there's someone out there trying to go after this, I'll tell you, I'll tell you, we zigged, we zigged where others zagged.

35:04And it's the hardest thing to do. Because like, I remember all this, this sort of existential angst internally, where there are companies now that are lost to history, Rally software that went public, they ripped by us. We were growing at 50%. They're doubling year over year because we're selling single digit tens of thousands of deals to big enterprise customers and they're doing single digit million dollar deals. And so you looked at it and you're like, man, are we making the wrong choice? Jive was another that kind of ripped by us and went public. Like five, I remember for, I mean, lost to history, but at one point it was like the highest trading public SaaS company.

35:41It was trading at like 30 times revenue or something at a time that that was wild. Fog Creek, Fog Creek was, I mean, there was a bunch and you looked at all of them and they all had, they all had what would be very typical business models, right? Like high price software, enterprise sales reps that, you know, like you didn't, you didn't quote the price. You kind of went and knocked on the door. You had these value discussions. You tried to sell top down. You tried to get as much as you possibly could at that initial point of sale. And then, by the way, hope that adoption and customer success teams caught up with what you'd sold, so you didn't have kind of a renewal or retention problem on the other side of that.

36:19And it was nerve wracking to see those companies grow at twice our rate. We went exactly the opposite way. We're like, we're going to do something very different. We're going to build a business model that we think over the long term will work against competition. It ended up in our particular category working. And I feel like a lot of that probably has to do with the founders having full control and the long-term perspective on that. Like, had you guys taken VC early on, I have to imagine the VCs on the board probably would have tried to. There would have been differences of opinion, I think.

36:47Yeah. It was not just ownership, but just conviction. And again, being really long-term oriented, being like, you know what, we're going to make a bunch of investments that are just going to take a long time to pay off. I mean, things Atlassian did around, you know, its channel and its ecosystem development in the marketplace, you know, with ISVs that are building extensions and plugins like those are all things that are that are hard to create. They just take a long, long time. You plant those seeds and it's like you really don't see them grow for three years, four years, five years. And you have to be, you know, committed and disciplined around.

37:19No, we're going to continue to garden that, fertilize it, add features to it, grow it. Eventually, it's going to swell into a moat that we think is pretty defensible and meaningful. And it did. tactics on PLG, I'm sure you get asked this type of stuff all the time. But if you're a company right now, enterprise software, maybe you have a mid market sales motion where your ASP is 304050k, or maybe you're an enterprise company trying to figure out how to go down market, or maybe you're trying to be PLG, and you actually have no go to market figured out at all, but you're banging your head against the wall trying to make sure you can, you know, lay the groundwork because it is interesting, you it's much easier, going down from enterprise to product led growth, we talked to Brian Halligan sat in that seat and he was able to do it with like going from an outbound motion to more of a bottoms up motion or at least a sales up motion to more.

38:06But like that's hard. Not a lot of people do that. Generally, you're kind of beholden to the motion that you start with. If you go high, it's hard to go down. So if people are thinking about this, are there a handful of things like tactically that you would say? And I'm sure there's infinite permutations around it. And so the lessons learned are going to be bespoke to each market and each, you know, whatever buyer type and all that. But just high level strategies that you would give to people that are like thinking about how do I actually get PLG working? Either how to orient your team towards it, how to incentivize salespeople, how to orient your board around it, anything along those lines?

38:43I mean, the high level one is just like it is head naughty to say it is far easier to expand an existing customer than it is to acquire and land a new one. And so like part of the virtue of PLG, if you get it right, and it's, if you get it right around kind of like, you know, the acquisition motion, like what's in the product and how you onboard users into the product, how the product's priced, how you actually get people to sort of like buy and go all the way through the customer journey to land and then actually get engaged and activated and sort of like have that aha moment with the product.

39:13If you put all the investment into landing that, right, and you can acquire customers, even by the way, if you're leaving money on the table and you're gaining market share against competition, what you're winning is a future opportunity for yourself to expand it and grow your business that is way easier, I believe, than the alternative. and that's what we did. And so like just that was the sort of the design is we're going to leave a bunch of money on the table now. We're going to make sure that the equation with customers favors value on their side. They feel like they're going to look at what they get and how much they spent and feel like, man, I'm getting the better end of the deal.

39:54Like that's what we wanted. And we're going to do that for as long as we possibly can. It's like Atlassian still does that. You want customers that begin with a product and be like, I can't believe I'm only spending this amount of money on the product that does this for me. And then with that, we just pursued winning market share. And then we could expand that war chest of customers that were engaged and happy with high NPS at a different rate without competition. How do you orient the team towards this? Is it just the CEO needs to lead it and then go talk to the VP of marketing and go talk to the VP of Venge, VP of product, VP of sales and say, hey, we're going to do this?

40:31I think it's a business model design. Yeah. I mean, you're choosing explicitly, this is the business model we want to build and how we want to build it. And what gets hard is what made it a little bit easier for us is we constrained the enterprise opportunity. And so we just didn't allow ourselves to design an opportunity that actually needed salespeople really early on. We just didn't. We're like, we could build a product that we sell for, and eventually we did, for hundreds of thousands of dollars to millions of dollars. We're not going to do that right now. We're going to wait. And we didn't actually do that until 2013.

41:02The last went public in 2015. So in 2013, we're like, now we're ready to sort of like, go get that enterprise opportunity. By the way, we chose to do it after we kind of already won. We were, you know, we were, you know, we'd impregnated 5 ,000 companies with more than 1 ,000 active users of Jira that needed us to do more enterprise-y things. And it was an opportunity for us to charge for more enterprise-y things that we would build. And then because we were willing to charge more and they were willing to pay more, there was an opportunity to augment our business model with sellers to sort of knock on the door of existing customers and say, hey, listen, you've got 5 ,000 people that use this thing every day.

41:38You're only spending 30 grand. We've built a thing that's going to support that a lot better, and it's 300 grand. And I want to take you on that kind of upgrade expansion journey. And that was the evolution of selling inside of Atlassian at the point that it was 12 years old, 12-year-old company. And you mentioned this. It's kind of tough to play the hypothetical where it's like, what if you would have done that in 2007 or 2006? Wouldn't you have taken that 30 % growth and made it 90 % growth? Probably. But the business would have looked different. We would have been full of a bunch of other things that we would have needed to make that work that we just didn't have, like people in finance and people in collections.

42:17Bezos called it one-way doors versus two-way doors. And that's a one-way door. Once you start going down that path, you're not going back the other way. All of those investments would have pulled away from our ability to build some of the other things that became huge defensive modes, like our channel, our ecosystem, our customer community, just a bunch of things that a focus on. You know, we talk a lot about still at Last Handic Access today. We are focused on, you know, the Fortune 500 ,000, that was our customer segment. And, you know, that's a bit evocative because there kind of isn't such a thing.

42:51But like internally, we said it for a long time before we talked about it externally, because that was the mission. It was like, we're going after ubiquity here. Like we want, we believe every company on the planet should use one or more of our products every single day. That's what we're going after. And even though there might be a shiny, massive company that could be worth, by the way, and this is the hard part. One company could be worth 500, one big company could be worth 500 small ones or 5 ,000 small ones. And so you're like, man, if I just spent a year chasing the one big one, I don't have to worry about the 5 ,000 small ones.

43:26And we're like, no, the 5 ,000 small ones are going to make it a lot easier to get the one big one in the future, which is true in our particular case. So what about a singular KPI? Or I'm sure there's tons of things that people orient around time to value or time to sign up or time to inviting the next user. Facebook's one back in the day was like, I forget, once you got five friends on the platform. Was there any KPI that you guys looked at or that you would tell an entrepreneur that's trying to build a PLG kind of bottoms up sales motion? Hey, this was our North Star. Is it just getting the customer to take out their credit card?

43:59Is it getting someone to use the product as you intend? I mean, it's going to be different by product. But for us, we cared a lot about driving considered traffic to the website. What are the things in marketing that we could do to just get more people to come learn what we're doing and what the products that we're building could do for them? That's sort of point one. And, you know, the goal of the website and you have to get really good at, you know, like there's a discipline here and a technique, but the goal of the website was how do we get them as quickly into the product as possible? And we don't want to skip some intermediary steps maybe that might like help them stick in the product.

44:33But there's an art there and a science of, you know, I just don't want you to hit the just try button because you could go in there and be like, what am I doing here? I don't, you know, I don't belong here versus some people that, you know, like those journeys you have to be, you have to constantly iterate and kind of design. But getting people into the product was sort of like the next big trigger and removing as much natural friction from that without getting people confused. And then investing a lot of effort is once you are there, like exactly what you're mentioning, what are the paths that increase the probability for people to engage?

45:06And like engagement was a really meaningful metric and there's lots of different ways to define that in the product. But, you know, what is a user that's engaged and activated that has the highest propensity to not just stick around, but to invite other people to be an evangelist inside of their company? And then ideally, once they're kind of really activated outside of the company around what we do and lots of different things, you know, that we would do. But that was it. And by the way, it's a little bit like painting the Golden Gate Bridge. It's not like you. I could say if you just do these five things, you're done.

45:33They evolve and change as you get deeper into your market and the customers you're trying to acquire are harder. And the customers you're trying to engage and stick and get activated are harder. And the customer you're trying to expand and renew and retain are harder. All that stuff gets harder. So you have to look for new things. It's sort of like, oh, the logical path for Facebook used to be I just upload five photos and add five friends. Now it's like, I don't know what it is because you're in Facebook. But, you know, it's it becomes like different. There's different dimensions of how do I keep this cohort there?

46:05And you've got to figure that out for every kind of future cohort that becomes a little bit trickier. Facebook today is rage bait on a political. Yeah, there you go. It's like that. Yeah, it's a it's a political video that makes you very angry. So Atlassian famously had two products very early on, Jira and Confluence. And I think at IPO, you know, whatever, time, time well gone. But it was 60, 30 or 70, 20 percent or something. in terms of the revenue split. So pretty meaningful. And the cross-sell between the two products, I think Confluence was, I don't know, 80 % of... Yep. Co-ownership. Yeah, exactly.

46:39People having both. Confluence was built early on. Yeah. When did that come as a product? And what would you say about having two products early on? Because the stereotypical wisdom in Silicon Valley, so to speak, is like, just get one right before you start doing another because it's going to distract and different resources and all that. Yeah. Before I, I mean, it was before I got there because the second product I think came in the second year or the early part of the third year. And, you know, it really was like they were mostly trying to just scratch their own itch. They were like, we have a need for, you know, Confluence, you know, was first just an enterprise wiki.

47:18It was like wikis existed in open source, you know, but there weren't really good enterprise ones that provided sort of security permission sharing, kind of a bunch of, you know, table stakes things for, you know, collaborative content platforms. And I think the team had used a bunch of open source ones and said, like, these all suck. We just want to build a better one and did. And again, didn't have maybe, you know, maybe guidance that would dissuade them from that. It's like, no, you're going to take energy. You're going to rob energy away from a thing that's ripping right now. Like Jira's, you found product market fit.

47:50People need a bunch more things in that box. like just focus on that for now would have been conventional wisdom. I think that, you know, naturally the company would be a very different company if it were just Jira. So, you know, it was the right call. I think, you know, I wouldn't necessarily give this guidance writ large to like, yeah, absolutely work on a second product when you're just an infant. I think you need to be thoughtful about it. But what it did for us that I think are kind of the intangibles that were really valuable is it is always hard for a company when you work on that second act or the second product to diversify.

48:27It's just tough because it's not just that you've got another thing that you need to add features to and you need to talk to customers about. Your marketing department has to think, what are the sort of priorities of how I message it? What does the homepage look like? You know, all the parts of the business need to think, I've got two things that I need to care and feed? How do I determine where I invest more or less across those things? And it just becomes really difficult. And so those are muscles that you will always as a business have to develop. I believe the longer you wait, the harder, actually the harder it is.

49:01If you're a thousand person company or a 2000 person company or a 5 ,000 person company, you're like, great. First act is running out of gas, let's pick up the second act. On one dimension, you could say it's like easy because I just, you know, park a bunch of people in the garage and I'm like, go, go work on something. We need to integrate that into the fold. You've got 5 ,000 people that you need to calibrate on. It's just tough. And so I think for Atlassian, you know, we benefited from, from building kind of that musculature and the company at a really early age. And so then when, when we had acquired our first company and you took the products from two to six, it kind of was natural.

49:34Like, you're like, oh, we know how to do this. Like we know how to, how to think about like product launch priorities, or we know how to think about messaging priorities. And we know how to think about, you know, how we stack rank our cross flow messaging, how it works. Like we get that. We know how to think about rationalizing pricing and packaging. So it's not this, you know, like weird menu of a bunch of things that cognitively, you know, impair the customer. It's like, we know how to kind of like harmonize it. And so the customer's like, oh, I get this company's thinking about that. And that requires a bunch of work.

50:06So I think hugely beneficial to the kind of company that we were building to do it earlier rather than later. But also there's tradeoffs. Like, you know, potentially, you know, you could argue like Jira's feature velocity maybe suffered a little bit. There are other things that we could have done kind of in that product to advantage it worked out in the end just fine. But those are the tradeoffs you make. We touched on pricing and how, one, the pricing was flat for a long, long time. to kind of staying under a certain level so that it could just be added to a credit card. I get the feeling it was also kind of a competitive advantage because your cost structure and sales motion and all this stuff was such that you didn't need to extract a ton of dollars out of each individual contract.

50:55I spent a ton of time in boards. I feel like every to be on a board is to be rethinking pricing of enterprise software companies in perpetuity. What were the strategic inputs into it? Was it that, hey, was it the Amazon philosophy of, hey, let's just make it cheaper and easier for customers and over time we'll accumulate the value and we know we'll have the right to go expand as we have a bigger product set or more enterprise feature sets or whatever it is? It was, as part of the business model, we wanted pricing not to provide any friction. In fact, we wanted it to kind of lubricate the rest of how it worked.

51:29And so it was so affordable. People were like, this is just ridiculously cheap. Like, I almost want to just figure out if I can use this product because it's so affordable. And so it aided the business model. It aided expansion. And so, you know, we had at the time like unlimited license, you know, unlimited versions. You know, we licensed by seat or by user or by kind of at the time because it was on-prem by kind of user bands. and there was like an unlimited user band that again was so affordable that even if you were considering this for 100 people, you'd be like, man, the unlimited user version is just, it's like less than, it's 3 ,500 bucks or it's like eight grand.

52:04I'm just gonna buy it for everybody. And what happened was it just meant that it got planted in an organization and everybody got invited into it. It was like, I've already paid for it. Like, I don't need to think about the nine bucks a month per user that's sort of common in SaaS now or whatever it is. It's like, nope, already bought and paid for it. Just like, come on in. And what happened was, you know, a big company like Boeing would have like 50 of those unlimited usage license all over the place. Because like a big company like Boeing is effectively a collection of, you know, thousands of little small companies that may be interconnected or may not be.

52:37They may be kind of siloed and isolated. And so people just sort of pop it up and adjust, you know, that pricing really was a lubricant, you know, to kind of expand usage and adoption. It just meant that the roots got planted deeper. And then we wanted it to also be a competitive barrier to entry. And so still today, like Atlassian is like very affordable at the bottom end. It is tough to just to get any grip in that market because you're like, how do I like what it's free, basically at the bottom, super affordable at the kind of entry point when you get up into the enterprise level can become more expensive, but that's not where you're going to start and win.

53:10And so it's just a, you know, it's a moat, you know, a competitive moat. And, you know, and then the business model, like the point you made is important because in the global financial crisis, when things kind of sputtered out, we looked at, did a bunch of cohort analysis and the customer segment that effectively was hurting the most naturally was the kind of small business or small teams. It's sort of like, you know, teams or companies under 10, it basically just dried up. And that at the time was, I don't know, maybe 10 % of our top line. And we did this radically courageous thing. We're like, you know what?

53:45Let's just make that tier, which is like$1 ,000. Let's just make it free. We made it$10. We called it a starter license. And then we donated the$10 to charity. So there was a little bit of a marketing campaign around. We called it Causeum, For Cause. We're like, you spend$10 on a license, we'll donate to a room to read charity and kind of fund girls' educations in Vietnam and things like that. But what was interesting is no one in our market could match that move because of their sales models. Like we didn't actually have commissions to pay. We didn't have salespeople whose quotas were on the line at$1 ,000 products or$10 ,000 product.

54:19And all the companies that I mentioned that compete with us just watched us do that. And we just rode away with the market. Like it widened the aperture of who would consider us. Then we were a safe harbor in kind of rough economic times for people that may not have wanted to spend$1 ,000, bucks, but definitely would spend 10. And, you know, there's a bunch of things that we that I think we did over the years that mattered to the company that last thing became that was definitely one of them. And it was like, at the time, remember, we were wiping, we were wiping off 10 % of our top line, like, we just put it back out in the market.

54:50We're like, you know what, we'll just erase that. And because effectively, you're saying, hey, when you renew, guess what is now free. So we're going to wipe that off in favor of widening the aperture on who's going to consider us and just go after share. And we could only do that because of our business model. You guys did a great job of building an offline community, online and offline community of users and around the product and all that. How did you go about seeding the community when people started having random meetups to talk about Atlassian? And did you encourage that, foster that? Did you guys pay that?

55:32Did you start suggesting it on your own? Or did it just happen purely organically? How did that come to be? So we we've been building over time, you know, a pretty strong word of mouth business. And, you know, we thought about this word of mouth fly will, it's sort of like the thing, the thing that we're trying to earn is just more happy people. And the quantum of happy people makes sort of the megaphone that that happy, happy, you know, community will will create louder. And that was sort of the goal. And you know, it's tough about word of mouth businesses, you're like, where do I spend money to go get more of it?

56:02And, you know, the logical place is you spend it on, on, you know, the persona, you spend it on the people. And, and so that sort of, you know, that kind of birthed the idea around, around really funding and coordinating a broad customer community program. And part of it was just like, you looked for customers like in market, that were your champions that were animated. And you'd be like, hey, would you like to be the head of the user group in Boston or the head of the user group in Kansas City? And usually somebody would be like, what is that? Well, we'll fund or reimburse you for just organizing kind of birds of a feather in an office or at a pizza parlor or at a bar or whatever.

56:48So we'll fund some beers and drinks and pizza and whatever. And it's just a chance for all of you to talk about, I think, what you care about, which is what our products do for your company. And you're going to get a whole bunch of ideas, which is, by the way, what you want. And this predated a lot of online communities that create something similar. But there is no alternative for real human connection. And so I think we found these happy sponsors. They're like, yep, I'll do that. And then our job was, we're going to help drive people there. Just put up the flag. We've got a user group leader.

57:24We're going to help kind of form that user group. And then we're going to help, you know, maintain it and manage it and grow it. And then, you know, we're going to cover the costs for it. And, you know, that requires like people inside our business to think about it and design it and to add features to it and all the other things that you do. But it was an intentional effort. And then the way we used that was like really clever. When we had a big product launch, you know, we would go to all those user groups and we would say, like, we want you to hold a, you know, hold a user group meeting on this particular day.

57:52And we're going to, we'd send like boxes of, you know, secret coveted swag and a bunch of things where we were like, do not open until this moment. And it was just a really smart way for us to say on this, this big cloud launch, we're going to kind of like unravel it, but we want you at the same time live to unravel it with us and then just shout it from the mountaintops. And so like, you were always trying to figure out like that word of mouth exists, like how can you kind of put a lasso on it and kind of drive it around with you. And did lots of things that way, but that's sort of where it came from and it worked.

58:25And then in later years sort of said, hey, you can amplify more with online. And instead of hundreds of thousands of people around the world, you get millions of people that kind of do the same thing. I get the feeling the company Atlassian, we talked about the charity and giving away or donating to charity. Also, I know the founders now have different missions. Saving the climate, I think, is what I said. The planet, yeah. The planet, like making sure we don't all die. I think that that is one for, is that Mike or Scott or both? I mean, they both care about it. But yeah, like Mike is - I care about it too.

58:57I'm not doing anything. Mike is maybe more public in kind of all the things that he's doing there. Were there certain things, I mean, now there's this whole, bring your whole self to work, bring your work self to work, like elements of social causes and where the lines of demarcation exist between social issues and not. I get the feeling Atlassian probably was much more stood for some of the social causes that the founders cared about. Can you describe what that was like within the company and how you guys kind of thought about it? I mean, it certainly evolved. You know, maybe one of the earliest, actually one of the earliest places that we became animated around it was like Prop 8.

59:44It was Prop 8 in San Francisco around LGBTQ. Wasn't the full acronym then at the time, but it was around... What year was this? I think 2009, 2008, 2009, kind of when I joined. And that was sort of like the first kind of earliest incarnation of it, like here in San Francisco, because it was like a pretty electric moment in the city we were here. But actually taking a step back from that, I think, you know, Mike and Scott, having never worked at a place, again, from first principles, just wanted, like, they wouldn't call it diversity inclusion, but they wanted to create a place that they were happy working at and going to, and that everybody that was in the building was happy at working at and going to.

1:00:31And sort of that, sort of like the cultural bedrock came from that. It's just like, I don't want a place where you feel like you need to tiptoe across glass. They're creating an environment that they wanted to work in. And I think that, I mean, it's head naughty to say, but it attracted people that wanted to contribute to the same environment and built a culture where you could advocate for things that you thought were fair and reasonable to advocate for. So yeah, I think the company kind of evolved from there. And then, you know, it's taken public positions and, you know, internally, culturally, it has a lot of private ones, too, that we talk about where they royal we.

1:01:15The royal we. Yeah, it's hard. It's hard to drop the even though no longer you're still. Quarter of my life. Yeah, it's like tough. Yeah, it's hard to stop the we on that. You all made a decision. So so HipChat was a very successful product. Ultimately, it became Stride when Slack was really taking off. ultimately shut down, sold the Slack, and no longer existed. What was the inputs into that? And obviously, you had super successful other products. Like, how did you decide to... Because HipTrap was growing really quickly for a long time, right? But how did you think about cutting your losses and moving on there?

1:01:52Very hard thing. But, you know, actually, like, you know, I think a moment that I'm certainly proud of that I imagine everyone at the time was proud of. And you don't see many companies do it. Like the easier thing to do is just sort of like quietly push it to the corner of the building and you focus on different things. And maybe you're like, yep, it's still kind of doing fine. And, you know, I can name a lot of products that sort of are like that. I actually can't even think of another company that very publicly outside of maybe Google and Microsoft, like a handful of the big ones that you almost need to announce.

1:02:22Like I can't think of too many companies of this scale just publicly announcing like, oh, yeah, we're moving on. And it's tough because you feel responsibility to customers. Remember, this was sort of pitched competition. And there were lots of customers that had chosen HipChat over Slack. HipChat was beloved by a lot of people. That had said, I've looked at everything. I'm making this choice at last, I'm choosing you. And so the thing that was, I think, hardest is you've got to go back to those customers and say, we respect that choice. We're making a different one now. And here's why. And that kind of hurts, right?

1:03:01Because, you know, customers are not just, you know, they're choosing you. And then there's sort of, you know, there's people that basically may have argued for HipChat in a room with their colleagues, with their neck on the line and said, this is the right thing. And then, you know, the best thing you want as a software is the company is to get your champion promoted. I think the worst thing is probably to say, yeah, never mind. So that goes all in the balance. And I think we look really carefully at the market, what we thought our opportunity in and what chasing that opportunity would cost, what investing in that particular opportunity would rob other opportunities, sort of all of those things in the balance.

1:03:42And then just came, you know, to the hard, like the really hard decision that there were other things that were more important for us to invest in for our customers, even the ones that, you know, that had chosen HipChat over Slack. And it was the right thing to do. And then to also just be honest about it and to not kind of park it in a corner and say like, yeah, yeah, it's doing fine. But, you know, now we're all about IT service management or something else. It was like, you know, if this is something that we're going to do, we're just going to go out to the market and say, this is what we're going to do.

1:04:13And, you know, the Slack story, I think, is also interesting because we were, you know, we were very, a very competitive company. But, you know, there's just a bunch of good human beings at Alassian. I mean, it's still true. But in the early days, like, we were just really good people. And where that showed up is, like, even though we competed fiercely, we were very respectful. Like every time Slack had a product launch, like we would send them genuinely, we'd send them a congrats note and a big box of cupcakes for the office. And we'd be like, these features are pretty sweet. Like this is cool.

1:04:46Even though like we're trying to build a better product and we want to win and we think we're going to win, kudos. Like we know how hard it is to do what you guys are doing and so respect. Was Slack Jira and Confluence customers? They weren't at the time. I don't think they became customers later. certainly. So this is just being nice. Yeah. And by the way, GitHub was... Gosh, I would have fucking hated that if I were at Slack. Just killing them with kindness. But they would do the same thing. I think it's like they were a similarly cultured company. And we had a fierce competition with GitHub too.

1:05:18Very similar thing. We used to do these karaoke nights at GitHub when they were super small. And we'd sort of go over and just hang out and sing karaoke. And they had at the time in the city, They had this, God, I forgot who put it together, but it was like a dodgeball tournament where a bunch of technology companies would dress up like, you know, the dodgeball folks in the movie and just sling balls at each other. And it may have been GitHub that actually sponsored that. And it would have been an easy thing for them not to invite us to, I think, because, like, because they were like, those guys are just, they're good people.

1:05:51And so, like, we want them around. Like, they would invite us to the dodgeball competition. um and and the slack story is like you know when we wanted to find an outlet for it uh that's an easy it would have been an easy thing for slack to say like no way i'll just like you know i could just force you to sort of park it in a corner and just be uncomfortable with like our market growth or our you know our winning in this market and i think part of the reason that i mean i think it was a it was a good deal for them and it was it was uh you know it was a good i mean there was a bunch of customers that they could sort of bring along so just the mechanics of the deal i think were good for both sides.

1:06:26But the fact that we were a respectful, honorable competitor, I think made it possible. Certainly easy to say like, yeah, I'll consider that. And I think about that a lot because I think, you know, you want to win. Sometimes on the field of battle, you're just like, I hate those other guys. And we just weren't wired that way. And I think over the course of our history that we benefited from that. When you look back, Atlassian today's $40 billion, I think ish doing what two and a half,$3 billion in revenue, something like that. Yeah. What, what moments just stand out in your memory of, it could be the hip chat Slack thing.

1:07:05It could be, um, I don't know the Excel round, like what are sort of the things you look back on as the, um, crucible moments or the just things that as you remember your time there, and it could be the dodgeball tournaments or whatever it is. But what are the ones that sort of stand out in your mind? Either because they were super important to the business trajectory or they were super meaningful to the culture. I mentioned one, but I mentioned in the global financial crisis that starter lessons program that we launched, I think was a crucible moment. And it just kind of widened the aperture on the consideration part of our funnel.

1:07:46But it was tough. You know, it's like that was not an easy decision, the right one. I think divesting HipChat, you know, was a big one. By the way, one of my favorite, maybe I've told this story before, but, you know, one of Atlassian's values is open company, no bullshit. And everybody in the company, we made an insider post going public because of the way that we are transparent in the company. And, you know, there's always sort of tension where, you know, you're worried that you may break. Like the thing that you're entrusting the population with might be too much for them. And, you know, when we divested HipChat, three weeks before we shared that news on an earnings call, we told 3 ,500 employees.

1:08:26And with a high probability that that would leak, like intentional decision leadership, we're like, this could be the thing that actually breaks the value. And we're always going to pressure test it. We want to see like, we'll do it until it breaks and then we'll figure out what we need to do afterwards. And you didn't send out fake ones, like telling some people you sold it to Microsoft, telling some people you sold it. No, but I mean, it was packaged with, hey, there's people that are affected here that, you know, we can't necessarily guarantee they're going to have jobs on the other side of that.

1:08:55There are customers that are affected here that we want to hear, that we want them to hear in a coordinated way. There are Slack employees that deserve to hear this in a coordinated way. We're giving you all of that. And we're reminding you that open company, no bullshit. How many people were at the company? 3 ,500. Yeah. So that was one. And maybe, I don't know, there's lots of things that we did kind of on product along the way. I mean, certainly the IPO was a pretty meaningful moment. You know, one of my favorite marketing moments was we sponsored, we do all these sort of really quirky things when we were young from a marketing perspective that I think mattered a lot.

1:09:33Not any one thing was like, oh, that was one that did it, but it was like the sum total of all of them. We did this, sponsored this startup day with Michael Arrington, kind of at the height of TechCrunch, where we hired a Tom Cruise impersonator and had Michael interview Tom Cruise, which I think there's a YouTube video of that. It was just such a weird thing. But one of my favorites is we bought a booth at the Game Developer Conference. It's a big show for video game developers in San Francisco at Moscone. and kind of didn't belong there, but we had a lot of game studios that used Jira. And so we're like, I might as well go there.

1:10:06And then we're like, well, instead of going there, like what's, like, how do we just, how do we show up and actually like have some sort of difference that amplifies who we are and why we're there? And so the one that we did was, which is still such a riot. There's a documentary called King of Kong about like these Donkey Kong enthusiasts, the standup arcade game, where they competed for high score. And they'd buy these machines and put them in their garage and basically just play it over and over and over again where you could memorize basically in, I don't know, hours of gameplay, like every single little joystick move to get to the highest score.

1:10:42And the movie, by the way, is fantastic because it pits this, I think it was like a school teacher that lived in the Midwest against, that wore like dockers and kind of a light blue button down against this guy that wore like leather trench coats and awesome movie anyway so the the guy that eventually not to give anything away but what you know the the guy in the the dockers and blue shirts um really well known that movie at the time was like went all over the place so we hired him uh to to try to break his record with a stand-up donkey kong machine at our booth at gdc and and then the one funny thing is like he's he's deeply into christian music i think he made his own christian rock band he can't make this stuff up.

1:11:27And so the deal was like, I'll do it as long as I can sell my newly released Christian rock album called the King of Song, because the movie was King of Kong. But we just had like, I mean, line around the block for people to basically get his autograph and just stand in front of the Donkey Kong machine and watch him work. I don't know how many units of Jira moved, but like, you know, that's, we've got lots of those. King of Song though, it probably sold a couple of those along the way. King of Song could be on Spotify. That's incredible. One of the things I have in quotes here, and I'm not sure if you said it or if, I assume you did because I put it in quotes, but managing people isn't something everybody loves.

1:12:05So I think you have to figure out really early on if it's something that you love doing. Do you remember saying that? Yeah, I probably said something like that. Yeah, okay. Do you love managing people? I don't love managing people. I love leading people. and I think there's a difference. When I think about managing people, there's lots of parts of being a manager that aren't awesome. And I learned how to do them really well, giving critical feedback, right? Like telling people that it's not working, giving them a chance to adjust and when they don't, trying to convince them that they need to find a spot that's better for them.

1:12:43Can we talk tactics around that? Actually, that's something that I always get positive feedback on when people can actually give actionable insights on like, what did you learn about how to go about doing that, giving critical feedback or telling people it's time to move on? Like people appreciate honesty and candor with concrete examples and action. So like what happens to, I think a lot of inexperienced managers is a, most of us are conflict avoiders. And so you're just uncomfortable saying what you want to say. You're worried about hurting people's feelings. And so inevitably, like you either soften it too much or you don't give it at all.

1:13:21And then people get surprised or like, wait, you've been telling me I'm doing a good job. Like the back slapping or sort of like the positive reinforcement is a lot easier to give than what can feel like kind of negative course correction or critical feedback. But feedback is a gift. And actually, like when people hear it, like most people don't want to get sucker punched or don't want blind spots. They want to know them. And then they want the ability kind of with guidance to sort of adjust. And by the way, some of those adjustments might not be possible. And, you know, I think, you know, I think I did a good job of framing that too, which is like, I'm rooting for you.

1:13:53But based on what I've seen, and based on what we've talked about, the things that you need to do to sort of get on right track may not be possible. But let's figure that out. And, but, you know, that's what I sort of learned early on is it's sort of the combination of feedback early, feedback honest, like don't kind of hold back and sort of shape it in a constructive way, but then really give examples and then give concrete actions. Like this is what wasn't working. This is what needed to happen. And what could produce that outcome. um and you know the other thing is like you don't want to tell people this is this is how i think you should do it because uh you know my job as a manager is to find people as a leader is to find people that can do things without a lot of guidance or coaching like i can tell you kind of the what not the how i shouldn't tell you the how and maybe you know in people that you're trying to sort of like coach um or or you know work on some some performance improvement you could say i'm going going to give you some suggestions for how, but there's a, you know, there's, there's a, there's a time limit on how much time that, that, that we spend with me giving you the map exactly, because what I need you to do is design the map.

1:15:05I'm going to tell you where the destination is. Like the journey there is up to you. Um, but it's, but that's tough, you know, that, that requires, by the way, I would say just, you know, the difference between kind of leading and managing, managing requires a lot of emotion. It just does. So does leading, but actually like when you're leading, there's a dimensional leading that you actually, you can get more emotional deposits than withdrawals. Like being a really good manager, I think you're getting more, oftentimes you can get more withdrawals than deposits. You're giving more than you're getting back emotionally.

1:15:39Yeah, you are. And, you know, and it is a learned skill, right? I think the more you do it. Managing is. Yeah, it absolutely is. The more you do it and the more you kind of practice it, the better you are. And, you know, back to maybe the quote, like I discovered not everybody is going to be good at it. Not everybody actually will want to spend the time kind of banging their head around it. And they may be better served as being an individual contributor. They might be happier. And, you know, the business might be better. I think there's like this false, sometimes sort of like this false career progression of like, I'm only going to grow if I get people underneath me.

1:16:19and it kind of sucks. I mean, I think good companies have this sort of inspired program of like an IC track where it's like your skills are not motivating people, leading people, guiding people, course correcting people. Your skills are kind of applied individually to a thing that we need doing and you can level that up along the way and let's figure out like how to do that. Lassie and how to program like that. I think Google does too but I think it's important because like it shouldn't be, man, the only way I'm going to grow professionally is to become a manager and a director and a senior director and a VP.

1:16:52And then I've got orgs underneath me and people. And there's a lot of people that go on that track to pursue growth, but actually don't really belong on that track. They're not good at it. And we've all had bad managers, right? And a bad manager is like somebody that either shouldn't be there in the first place or like wasn't taught by a good manager to begin with. And so like, they're not trying to figure out how can I be a good manager? The other thing too, by the way, I could go on this topic forever is like, like I, I, another, another thing a good manager does is, is should be open to, um, critical feedback of them.

1:17:26Like we early on Atlassian kind of had adopted this, um, performance management system that was bi-directional. And it was like, it was again, from first principles, I think it was kind of a breakthrough for us where it was like, uh, it was, there was a software product still around, I think called small improvements that did this thing where it was like kind of a YX axis. And blindly, without the manager seeing, the user would kind of draw a dot. The axis was maybe like, you know, execution against, you know, objectives in the quarter, like how you did, and then kind of how you stretch beyond that or how you, some other thing, like how you contribute to the culture.

1:18:07And so like way over here to the top right is I'm just killing it on all dimensions. I'm doing everything, I'm above and beyond what you need me to do. And I'm like contributing to culture and team and like everything else doing things you don't ask me. Um, way down here is like, we've got a big problem. And what I loved about the system is, um, you know, the employee would drag the drop or drag the dot. And then the manager would drag the dot. And then you do a reveal and you'd see the difference between the dots. And it was just a perfect way to say, we've got a disconnect. Let's talk about why you're way up here, which usually happen.

1:18:36And I'm down here. And what, what I would have wanted to see to get you up there. The cool thing about it is we inverted the system where it was like, how about me as a leader? How would I draw the dimensions of how I give you critical feedback, how I give you coaching, how I give you positive reinforcement, how clear am I on communicating expectation? And then as an employee, you rate me, you drop the dot, you're shit. You never talk to me, you never tell me I do a good job. I never hear anything about what I could be doing better versus the manager's like, man. And so let's talk about that gap.

1:19:09And it was such a beautiful way to trigger what can be an awkward and really hard conversation, just discussing that gap. And so you enjoyed the leading aspect of it, maybe not as much the managing because of elements of that. What was the path, talking about a job that doesn't really require much managing, what was the path into venture for you after a dozen years at Atlassian? Why pursue this? A couple of things. One, I felt like after 25 years, I've learned and seen a bunch of things that I believe can be useful to lots of businesses in different shapes and sizes. And I've seen hard times. I've seen tailwinds.

1:19:52I've seen how as a leader and as a culture and organization. You need to reinvent yourself at different points of inflection. I've done a lot of really hard, but I've like, I've just done a lot. And by the way, it's not all going to be applicable. And my advice always isn't going to be good, but my choice when I have time, I'm young enough where I want to do something different. I've been, you know, at Atlassian for 12 years, kind of doing the same thing, reinventing myself, you know, every 18 months is sort of, I needed to at different inflection points, always kind of in the biggest, not always, but after kind of the first handful of years and the biggest job I've ever had.

1:20:24So just first principles of God, what do I have to do here? I've never seen this before. I have to figure it out. And my choice was like, I could take all that accumulated set of experiences and apply it to one thing again, where it's like, man, I just go find a company that I want to help build and grow or start one and just rewind the tape and hit play. And I'll be a lot smarter, faster, you know, to do that. Or what attracted me was like, let me take that and figure out, you know, I joined HubSpot's board. And I just got a lot of energy from, you know, being in the room with a company that was like three years or four years behind what I'd just seen.

1:21:00And I felt like when I had something to give, I'm like, I think this is useful. Like I know the problems. I know what's going on inside here. Even though I'm not in the room with you, I've been in that room. I kind of know what it's like. And so I feel like I can be constructive and helpful. And that's what drew me to investing is on the other side of, you know, winning an opportunity to work with a company. You know, you're paired with a company for five, six, seven years. It's a long journey. There's a lot to figure out. And I just wanted to surround myself with, you know, a portfolio of companies and founders and management teams where I could do that.

1:21:35And part of the leading thing, like I'm not leading, but, you know, there's mentorship there that's a part of leadership that I get a lot of energy from. And then, you know, there's business building. that kind of on the sidelines I like to contribute. You could pick a path to advising though, right? Where I don't, 40 billion times 12 years, I don't want to do the math, but I think you probably didn't need the economics only of being a venture capitalist and done the HubSpot board. And I'm sure a bunch of other people would have had you on their board. Why the investing, the pursuit of all of this specifically?

1:22:11Uh, one, um, I, I, I wanted exposure kind of inside of a firm and inside of investing you just to get exposure to also just a lot of different things that you're going to learn. And I'm a lifelong learner. And so I just, I love part of the job that is a gift is, you know, every day is sort of a new adventure around a category or technology or product or a team or a market. And, and, you know, you could do that on your own, but sort of the job is a forcing function to, to, to do that. And so I wanted that. I wanted to see a bunch of different things that I may not get exposed to, or I may not naturally kind of draw myself to or get drawn into based on my experience.

1:22:47And that's true. I felt that kind of the combination of my operating experience and that I'd done a bunch of personal investing, I think professionally would make me, I mean, we'll see, would make me maybe a better investor. and um and you know i i do like the discipline of uh of um both investing because my money's invested alongside you know lp money but i like the discipline of being a steward and responsible for other people's money there's a scoreboard at the end there's a scoreboard and and by the way it's and it is at the end i mean you know this it's a sales job i mean i started my career in sales like i joked i joke with my wife uh you know because i i joined bond uh you know i left at last year in june and joined bond effectively november december of 2020 and so it was sort of like prime pandemic years and i joked that i'd come full circled inside sales it was just sitting in front of a zoom you know my computer i remember us getting together and uh and uh it was the peak of just like go-go selling our souls to get in front of companies and i could tell you were like this i thought we would do investing and it turns out i'm just doing sales right it's yeah it's which is okay i mean there's like there's definitely shifted back the power dynamic You were at the peak of weirdness, I think, at that point in time.

1:24:04You were sort of exacerbated by what was going on. But there's also a little nerve ending in me that enjoys that part of the job. I mean, you have to... You're selling yourself too, which is nice. It's not like the engineers built the product and I'm going to try to polish it up for you. You're selling, hey, you get to work with me at the end of the day. There is something nice to that being the product. I think to be an investor and I think to be a good investor, you have to have that nerve ending. You grew up in product marketing once upon a time. And there's a weird number of people in the VC industry, yourself included, but also Eric Vicharia from Benchmark, Mike Spizer from Sutter Hill, among I'm sure others that I'm forgetting.

1:24:43What do you think about product marketing itself leads to elements of potentially being great VCs? I think it sort of sits at this sort of interconnected web of products, like the rule describes, product, marketing, sales, commercialization, pricing and packaging, kind of messaging and narrative. In product-led growth, like inside of Atlassian, the product marketers really were the main person around a huge chunk of the customer journey and kind of acquisition and engagement funnel. And by the way, you had to sit as a product marketer, you really called shots around how does demand gen work? How much does it make sense to spend on SEM or SEO versus brand advertising and display advertising or community development or event marketing in the field or whatever the other things were.

1:25:45You had to sit there and say, I'm actually responsible for what comes through that system. So I really need to be connected. And in part because I'm providing the messages that make those systems work around my product. But I really need to be connected around that. And so it's just to sit at that kind of pivot point around all of the different functions, both in product and in customer-facing teams, and just gives you a really well-rounded perspective. Not all product marketing is kind of built that way, but I think when it's built right, that's how it works. My fiance is a VP of product marketing at Maven, one of your portfolio companies.

1:26:20And I think she's going to – I don't know if she'll ever go into VC, but she'll make a much better VC than I am because she has that purview and all of that stuff. How did you land on Bond? Why didn't you call me? Uh, so yeah, so Bond, Bond kind of had, um, a bunch of things that, that, um, just were really attractive to me. I mean, for, for one, uh, and you know, you would have, you would have, uh, took this bucket too, but just like really great people. We didn't know each other at the time. Really, really great people. You know, I wanted to find a place where I would just enjoy doing the job with people that I would enjoy doing the job with.

1:26:56That wasn't, That was important to me. And so really good people. It was, you know, it was a new firm. I mean, the heritage of the firm dates back to kind of, you know, Marion team starting the digital growth fund inside of Kleiner. And they, they, they, internet research analyst into Kleiner Perkins growth investor. And so they had been, they'd been kind of rowing that boat for three funds inside of Kleiner and then came out. And so the firm was actually like a clean sheet of paper. And that mattered to me because I wanted, like I was, I was going to sign up, you know, know, to do this for a decade plus.

1:27:28And it was new to me. So I was diving in the deep end. And, you know, I wanted to, I was going to swim furiously. I'm like, I'm, I'm, I'm in the whole of a bunch of mixed metaphors. I'm in the whole like digging furiously. And I wanted to know that the partners that I was going to join would dig as furiously as, as me. And because it was new, they had to, right? Like it was, you know, it's just a brand new firm. It's like sink or swim. You're going to build it from scratch. Like you can trade a little bit off, maybe kind of personal reputation and things that they'd done at the Digital Growth Fund.

1:27:59But to make Bond a thing, it's like we're all in. We're making this a thing. That mattered. I, you know, they had done some enterprise investing, but kind of the heritage of the firm was more consumer oriented. And so it was an opportunity as a builder to kind of build from whole cloth an enterprise practice. And that's a unique, rare opportunity. Like I could have, if I would have come to Red Point as an example, it would have been And like, maybe I would have added some pixie dust, but you guys would have been fine without me and it would have been a great enterprise practice. We can talk about this offline.

1:28:34But the chance to kind of like, you know, mold clay and kind of create something. Yeah, there was definitely a Tetris block that was open that you've come into over there. And those don't come along very often. Like I've been, you know, blessed with timing professionally in kind of more ways than one. And that was another one. I looked around and it's like, if any one of those ingredients weren't there, it wasn't any one, but it was sort of the combination of all three. I was like, this is just really unique. And growth stage, by the way, it's like growth is, I'm really animated by the stage that I invest in.

1:29:04If you're trying to find product market fit, I'm less animated by it and probably you could use me less. When you've got it and you're trying to figure out all of the dimensions of the business and how it needs to change as you go from 10 to 50 to 100 to a billion, I've seen and done that. What surprised you most about being on the side of the table? What surprised me most? Well, I mean, I came, like you mentioned this, but I came at kind of a really odd time. Like, so there was a bunch of frenetic energy in 2021 that I was surprised by. And, you know, in that period, you know, this is a courtship.

1:29:42You know, there should be a lot more data. In my opinion, there should be a lot more dating than there was in 2021. because ideally you are not just getting a wire transfer into a bank account. In some cases, that may be all you want. And if that's all you want, declare it and just go get it. And by the way, I don't begrudge anyone that just wants that. If they got everything else figured out, it's like, I just want the money. There was a good animal firm that would give them that stuff once upon a time. Yeah, but I do think there's, and for what I see at least, repeat founders, people that have been in it before value this a lot more than first-time founders, which makes sense because I think they've just got some scar tissue and war wounds.

1:30:20But I wanted to spend a lot of time trying to give founders that I was courting or I was trying to get to know as much as I possibly could where they were like, man, I actually want a lot of that. Or I want a lot of it after the fact. And as long as the color of money is similar, there are other things that I could advantage my company with that I should care about. And it's a self-serving pitch, but, but it's, I, you know, for me, for me, like that matters, like it's genuine. And what surprised me is like in that period, there just was a lot less of that. It was like very transactional. It was like, I just care about kind of the color money.

1:31:01And if I need anything else, I'll just go figure out how to get that later. But if they're saying that, do you imagine what they're saying to me? You know, you have your That lasting experience, I'm like, yeah, you know, I did this enterprise software investing before. Yeah, it wasn't universal. I mean, the companies that I managed to invest in, I think, carried about the same things I did and recognized that, you know, it's a long journey. It's not just sort of a Series B or a Series C. It's, you know, five to seven years of hard company building. Are you enjoying it now more than you were in 2021?

1:31:28Yeah, well, I enjoy different aspects of it. I mean, there's more of that. And so I enjoy that more. You know, the market is still coming back. You know, I think there's the activity kind of cadence is increasing, but I also like more activity. I like kind of more, you know, companies to be raising. And there's so much war chested capital from 21 and 22 that it might be a little bit wild, a little while. What get you excited about an investment? Maybe no surprise, some of the same things that I love and had a chance to build at Alassane. Like if you've got an opportunity to be ubiquitous, like if you've just got a big market.

1:32:05I'm way more excited about kind of big markets and quantum of customers and the ability to build differentiated business models to acquire them. I really love that. I'm a little bit less excited about, you know, I've got 500 customers that I'm going after. And even though like, you know, Plumtree was that. Like Plumtree only served the Fortune 500 and did it really well and built a great business. But just personally, I'm a little less animated about that than I am about just doing things differently and unique. And then, you know, I'm excited about kind of just the modal shifts, you know, that we're in the midst of, you know, right now that are very early.

1:32:49But I kind of went into this with an AIML thesis around how it had the potential to kind of reshape categories, which I believed. and uh and i think you know that belief is is is anything but accelerated or you know accelerated yes has it been weird to no longer have direct influence over decision making and said soft diplomacy as a means of action like see once upon a time you could direct it's called thousands of people and you own the decision one way or the other and now it's kind of like you give soft advice around stuff and counsel, but. No, I, I'm, you know, I'm comfortable with that because, um, a couple of things, like one, I know how hard it is like in the foxhole and, uh, and, you know, it kind of, you know, when we had people that advised the company, um, it did irritate me sometimes when, you know, you'd come and they'd be like, what about, what about X?

1:33:48And it's like, yeah, we, come on. I mean, we're. We've got about that, yeah. Yeah. And not to dismiss, but it's sort of like we've spent so much time, like we have covered, we've covered sort of like so many angles. You can say Excel. We've covered so many angles. And so like part of it just comes from knowing what I don't know about what goes on kind of in the trenches and how hard that is, nose to grindstone. And being able to sort of say like, I just want to contribute a couple of things or thoughts or pressure test some stuff. but in the context of appreciating all that goes into it. Part of it comes from that.

1:34:26Part of it also just comes from the experience of being on the board, you know, being on the board of HubSpot and kind of growing through that process of being able to contribute in a different way than just calling shots or sort of saying, man, if only it were me and my team that kind of went in there and did it, we'd do it this way and we'd do it faster. And it, again, circles back to, I don't have all of the data and circumstances to know. like maybe i would end up at the same spot you know given the same set of ingredients uh and so i'm actually comfortable with that i think it's sort of mentorship and idea and pressure testing and have you thought about where i really try to to challenge myself to supply the have you thought abouts if i think they're really out there like they're not the the low-hanging fruit have you thought abouts they're like high up on the tree and still kind of productive and useful.

1:35:18And that's, uh, and by the way, if they're too far up on the tree or if they're like, I don't know, crazy or kind of rotten fruit, they've already dropped off to the ground. I'm, I'm okay. Yeah, it's okay. How do you guys make decisions at Bond? How do you come to an investment decision? Pretty collaboratively. And we're small, you know, like most farm, you know, most, uh, most firms are, um, you know, I think we try to, um, try to kind of lean on everybody's individual strengths and superpowers, sort of like the Voltron effect of everybody's got kind of like a different thing that they could particularly spike on.

1:35:52And can you bring that into kind of the situation, into the context and kind of apply it and challenge, you know, challenge an investment decision or a company that we're considering through that rubric? Like we don't all need to, you know, to plow over the same ground that's kind of rotatilled that's obvious. It's sort of like, and sort of my thing would be naturally around sales and marketing. Like, you know, even though I've never worked for a consumer business, like I understand how sales and marketing works kind of writ large and a bunch of the same tactics. And so I can kind of, I can put a lens sort of on a particular kind of business, maybe in a unique way that I think would be valuable.

1:36:29And then it's, there's always going to be an element of, of, you know, kind of just pressure testing and challenging. And we thought about this, have we looked at that? If you looked at this way, stand and defend this particular bear case or this particular argument. And mostly that's just that pressure, I think, either highlights a crack that we hadn't considered or just makes the diamond kind of a little bit shinier with less defects at the end of it. And then there's conviction. I think you want to make sure that you're deeply convicted because at the end of the day, the firm is making the investment, but there's a partner that is going to be connected to that investment personally for a long time.

1:37:12So you have to like really say, you know, I'm convicted about this, not emotionally, objectively. It's always gonna be a little bit of motion, and that stands for something. And so they're sort of testing all that. What's the underwriting or framework of like a bond company? Like when you guys say, you're looking around the table and saying, okay, we're gonna do this. Is it really an iconic founder? Is this really a longstanding IPO, public business or something? Like, is there a heuristic or framework at which you guys assess these things? I think we look for generational businesses. Does this business have the ability to be generational, to be a truly generational business?

1:37:50And does it have kind of the raw ingredients, all of the things that we could both list that go into that? Is the market big enough? Does a team have the ability to execute or to find people that can? Does a competitive landscape, is it disruptable in some way that either the business may be blind to or we're not thinking about? But like all of those things go into it. But at the end of it, it's like, you know, can this company actually like be generational? You know, be a 10 to 20 to 30 year company along that way. You know, and by the way, the answer to that question is yes. Higher probability that you are going to go public.

1:38:23You are going to like, you know, build something meaningful from an early age. You've been in venture now for coming up on two and a half years? Two and a half years, yeah. What have you learned most from Mary Meeker? Man, a lot. But Mary, a couple of things. Like Mary asks a really good question. So Mary has like this uncanny ability to snap almost better than anyone else I've seen, just snap into kind of a different reality and occupy it, like almost the reality of the company. And then the questions that she asks occupying that reality are just always, always in tune and insightful and challenging.

1:39:04and like she's just like that is her gift and she can she part of it is like she can also pattern match like nobody else which is useful where she's seen a song that you know might have similar notes played by a different band and you can kind of like bring that into the context um that's sort of one thing you know she's also um has like has an eagle i mean we we uh you know we do kind of a lot of like deep financial modeling. And part of this probably is her kind of early day, uh, analyst training for Morgan Stanley, but she has like an eagle eye, um, for, uh, you know, uncanny detail inside of like a very complex spreadsheet.

1:39:46Um, you know, which again is an acquired skill, but it's, it's amazing. You know, it's like, you can kind of look at something. And by the way, I've looked at lots of PNLs over the years and sort of lots of big, gnarly, complicated spreadsheet, but she has the ability to kind of zero in a spot and also understand the right question that contextualizes why that spot looks funky. It's like, let's talk about that spot. And by the way, like zooming back from that spot, how does the rest of this spreadsheet, how does the rest of this model or kind of like, what should we be asking that that kind of spot illuminates?

1:40:22It's often much more important in consumer investing because there's a lot more stuff going on and the acquisition and the cogs and the SaaS, fairly simple. But clearly she's done both, but an iconic consumer investor. And it's sort of like that kind of marriage of deeply effective quant qual is a superpower, is a superpower. Any other investor or operator influences that you really internalized a point or two that you bring to work every day or that's super helpful? I mean, part of what drew me to investing was my experience with Rich Wong at Excel and actually the Excel team who I know really well.

1:41:10If you're going to say something nice, I'm going to bleep this out. They were a really important part of our journey. And in a way that I would say, there's not one thing that I'm like, man, if Excel hadn't done that one thing, Atlassian wouldn't be Atlassian. But there was sort of lots of significant things, maybe small, but significant. Just guiding hand type stuff. Yeah. And I don't know if this story has been told, but Rich had such kinship, I think, to the company that he, I think naturally was looking forward to the IPO. I mean, the funny thing is like rich would always just say like hey you know the the funny joke inside of Atlassian is like the answer to when will we go public was always 12 to 18 months for maybe like four and a half years and uh it always felt true at the time and eventually it was true but um rich i imagine at times was like oh man can you know like when when will it happen so when it finally happened like you know this is a guy that had been super excited about this outcome and a week a weekend before he got into a small skiing accident, I think chasing his young son and blew out his knee.

1:42:21And so he couldn't go to New York. And this is, you know, five years after being with this company through trials and tribulations and all sorts of stuff. And here we were in our moment, he couldn't make it. And we knew how important it was to him. And he was so important to us that we organized, you know, kind of a town hall and brought him in on a wheelchair and thanked him in front of, you know, all the employees for his contribution to the journey that we didn't want to go and noticed. And it was like, it just sort of, you know, like super cool. And by the way, he's still on the board, you know, he's still on the board of Alassian, you know, I don't even how many, how many years later, it's like, you know, certainly 13 years after he made an investment, he's still on the board.

1:43:03And I think it's testament to him as a human being, but also just the relationship that an investor can build with a company over a long period of time is what drew me to investing. Alex Bard, your partner, is kind of another one. He's an operator that had crossed the chasm. And I've known Alex for a long time and spent a bunch of time asking him question after question after question. Like, what is this like? What do you like? What do you don't like? Spent hours and hours. And the positive experience that he had in Redpoint as an investor and what he was able to do. It meant a lot to me because I think we're similarly wired.

1:43:41And so it's sort of like a validation, a deeply personal validation point where you're like, yeah, this is different. I understand the ways that it'll be different. I actually think I'll be able to navigate them in the way that a good operator like Alex has to become a good investor. Jay, thanks for doing this. Yeah, you bet.

1:44:06Thank you.