In short
This Week in Startups - Episode 1781 Summary
Host: Jason Calacanis Guest: Dharmesh Shah, Co-Founder and CTO of HubSpot Date: [Episode Date]
Episode Highlights
Introduction
- Jason introduces Dharmesh Shah, celebrating his long-standing friendship and collaboration in the startup ecosystem.
Dharmesh's Angel Investing Journey (2:36)
- Dharmesh shares the story behind his angel investing journey, which began during his time in grad school at MIT after selling his last startup.
- He emphasizes his desire to stay connected to entrepreneurship without starting another company, likening angel investing to being a supportive uncle rather than a parent.
HubSpot's Evolution (6:19)
- An overview of HubSpot's journey from a startup to a public company with about 7,000 employees and a current market cap of approximately $25 billion.
- Focused on small to medium-sized businesses (SMBs) and the challenges and advantages of serving this market.
SMB Focus and Market Strategy (8:48)
- Dharmesh explains HubSpot's deliberate decision to focus exclusively on SMBs rather than pursuing enterprise clients.
- Advantages of serving the SMB market, including accessibility, quicker decision-making, and the potential to democratize technology for smaller businesses.
Entrepreneurship and Idea Assessment (17:45)
- Discussion on the best reasons to start a company: passion for a problem and collaboration with like-minded individuals.
- Dharmesh provides a framework for assessing startup ideas, including potential outcomes, probability of success, and personal proximity to the idea.
Product Velocity and Efficiency (42:03)
- The importance of product velocity in startup success, emphasizing rapid iteration and feedback from customers.
- How AI and automation can enhance business processes and lead to more efficient organizations.
The Future of AI in Business (46:39)
- Insights on how AI will transform roles within companies, automating repetitive tasks and allowing employees to focus on higher-value work.
- Dharmesh predicts that AI will create opportunities for new products and services previously thought impossible.
Starting a Business in a Downturn (39:40)
- Discusses the challenges and benefits of starting a business during economic downturns, emphasizing that talent is more accessible and rents may be cheaper.
- Encouragement for potential entrepreneurs to embrace AI as a tool for innovation and productivity.
Key Takeaways
- Angel Investing: Dharmesh’s approach focuses on maintaining time efficiency, allowing him to support other founders while managing HubSpot.
- SMB Focus: HubSpot's dedication to SMBs has been a strategic choice that differentiates it from competitors typically focused on larger enterprises.
- Framework for Founders: Successful startups often pivot from their original ideas, highlighting the importance of starting and iterating based on market feedback.
- AI's Role: AI is seen as a major player in enhancing business productivity and redefining how companies operate, leading to new opportunities.
- Optimism for Entrepreneurs: Despite economic downturns, there are numerous opportunities for startups, especially in leveraging technology and AI.
Closing Remarks
- Jason thanks Dharmesh for his insights and contributions to the startup community, underscoring the impact of HubSpot's support for emerging businesses.
- Encourages listeners to explore HubSpot’s startup program, which provides significant discounts to early-stage companies.
Follow Dharmesh Shah
- Twitter: [@dharmesh](https://twitter.com/dharmesh)
Sponsors
- Vanta: Offers compliance and security solutions for startups.
- Crowdbotics: Provides rapid development services for app ideas.
- Fitbod: Offers personalized workout plans.
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This episode offers valuable insights for entrepreneurs and investors alike, focusing on the importance of adaptability, the role of technology in business, and the potential for growth within the startup ecosystem.
Written by AI. May contain mistakes. Listen to the episode to check what was said.
Transcript
Automatic transcript. May contain errors.0:00And the truth is, even when you start with an idea that you're super passionate about, in greater than 50 % of chances, you thought you were starting a jazz trio and you made a rock band or a rock band or a rock band or a rock band or a rock band or rock band or rock band or rock band or rock band or rock band or rock band or rock bandwomen success in a lot of ways. Yeah. Well, and waiting for the perfect idea is actually the barrier to finding the perfect idea. Even better. It happens after you start. Once you come into contact with customers, the market, you work together and you start, I love your analogy, as you start playing is when you kind of really discover, kind of discover yourself and what's out there.
0:38This Week in Startups is brought to you by Vanta. Compliance and security shouldn't be a deal breaker for startups to win new business. Vanta makes it easy for companies to get a SOC 2 report fast. Twist listeners can get$1 ,000 off for a limited time at vanta.com slash twist. Crowdbotics. Great ideas can change the world. And Crowdbotics is the fastest way to turn those ideas into code. Get a free scoping session for your next big app idea at crowdbotics.com slash twist. And FitBot. Tired of doing the same workouts at the gym? FitBot will build you personalized workouts that help you progress with every set.
1:22Get 25 % off your subscription or try out the app for free when you sign up now at fitbod.me slash twist. All right, welcome back to the program, everyone. Today we have another amazing guest, one of my favorite people on the pod or just outside the pod. Dharmesh Shah is the co-founder and CTO of HubSpot. He was on the show 10 years ago this year, episode 334. he uh is an incredible supporter of founders angel investors thinker and a friend of the pod welcome back sir thanks for having me glad to be here uh you and i became friends because we share a passion for entrepreneurship and um writing those 25k 50k checks 100k checks into early startups i think we were both in raul's first company were you we were yeah uh rap leaf i think it was called um uh it was called reportive reportive that's right rap leaf was the other one that was doing apis around social media but report of got sold to linkedin and then you and i were the first investors in superhuman and uh it's one of the great things about having a reputation as a supporter of founders early is they always remember yes for their first company and they always have room for you in the next one maybe you could talk about uh we got so much to talk about with ai and hubspot and all the great things going on in the world but i wanted to start just with your what you learned being an angel investor and you know supporting other founders uh in relation to uh building your own company and keeping your own mind sharp yeah um so i'll tell you a quick story of how i got started angel investing in the first place because i was in grad school um at mit here in the boston area and um i just sold my last startup and i had promised my wife i was not going to do any more startups and that's why i went back to grad school it's like, okay, I'll get my master's, maybe get a PhD and go teach.
3:13That was the original plan. And, um, you know, as fate would have it, I think, um, the entrepreneurial genetic flaw is very real. It's hard to stop it just once I was having withdrawal symptoms months into the, um, into selling my last startup. And so I'm like, okay, here's what I'll do. I will start doing angel investing, which I'd never done before. I didn't really know anything about it, um, to live vicariously through other founders. It's like, I don't have to have my own startup, but I can at least participate. It's a little bit like having a niece or a nephew where you get to play with them.
3:42They're fun. It's awesome. But then you hand them back to their parents, then you can go to bed and get some sleep. So that's why I started angel investing early on, you know, in my second year of grad school. And then, you know, ended up starting HubSpot, which I wasn't supposed to start after I met my co founder in grad school, and then just kept up with it. But I have a very kind of atypical style to my investing because I'm a very big believer in focus. And once we started HubSpot, I'm like, okay, well, this angel investing thing is really not going to work because it's kind of hard to do both things.
4:16So I set a bunch of rules up for myself, which is, I'm going to solve for time, which is reduction of time, not money, not return. So I don't meet with founders, I don't take calls, don't sit on boards, don't do all the things that might contribute to increasing the amount of time, no due diligence, try to make my decision in 24 hours. And so kind of kept up that policy, because that was the only mechanism by which I could continue to angel invest and feel like it was not taking away from my, you know, kind of primary activity, which is, as you know, startups can be or should be almost all consuming.
4:50So yeah, I've done I think, not as prolific as you have done a little bit over 100. Now over the over the years, I'm at three, 400, I think, but I have a firm now and what you pointed out, the stack of things that each your time due diligence um and then post investment support and then making decisions on pro rata um and then all of the anxiety that comes with the fact that you know in your child uh you know in kids and grandkids kind of analogy is really apt um and it is the case that the problem child if you have five kids um the child who is a rebel or who gets involved in shenanigans and has trouble at school is the one that takes all your time and then the two or three that are just absolutely gifted and rocking it or the one or two they don't get your time yeah it's a very hard conundrum um that i do not have an answer for because you're kind of judged on your reputation and then the people like all detractors and you know you know from having hubspot and doing marketing your detractors are really important to keep an eye on um because they'll keep you from having future success and you gotta really try to control the number of detractors even if you have a great product somebody has a bad experience in your restaurant you could be three michelin stars but that detractor is gonna destroy you every day of their life until they get their perceived retribution uh it's a really strange thing but talk to me a little bit about where hubspot's at um where it started and where it's at today uh it's been pretty rough road um in terms of the public markets but you seem to have weathered the storm and uh have a very solid product that people feel is um indispensable if i was going to use a word when i talk to startups and you guys are really generous to startups with your startup program uh but it's kind of indispensable i think uh and affordable so talk a little bit about the state of the company today and who are the customers and what do they use the product for primarily?
6:54Sure. So HubSpot is now 17 years old. So it's been a while time flies. They grew up so quickly. And we're about 7 ,000 employees. And as you noted, it's publicly traded, a$25 billion market cap based on which week you look. So and that's, and it's been a, like interesting journey, we can talk about kind of the pre IPO times and going through the IPO process. And our primary offering is we offer a CRM platform. So it consists of marketing, sales, service, software, operations, everything you need to manage your go-to-market and manage your relationship with your customers offered as a pure SaaS product.
7:36One thing that makes HubSpot noteworthy and remarkable is for all of our 17 years, we've been focused on the SMB market. Despite every quarter since our existence, everyone always asks us, including our investors and would-be investors, like, okay, it's fine that you started an SMB, but what's the plan to go into the enterprise? Because that's kind of the natural, I think of this reverse gravity that happens in software where outside of any kind of intervention or pullback, you always get pulled up in the market over time, right? The product gets more powerful. And as you move up market, usually all the numbers that you care about will look better.
8:11Your LTV goes up, the term goes down, all the numbers look better. Average revenue per customer. Yeah. Pick your metric of choice. And usually as you move up market, it gets better. But we very deliberately chose not to allow ourselves to get pulled up and stay focused on SMB, which at the time was relatively controversial and hard to get funding around. It's now gotten better, including HubSpot. There's other companies that have kind of succeeded in SMB. But back then, there were not a whole lot of software companies that had kind of built big global brands, multi billions of dollars of market cap.
8:45focus exclusively on SMB. So that's, Why did you make that decision? What was the reason to go after the wisdom, the collective wisdom at that time? Yeah, a couple of reasons. One is, I've been in enterprise software before. So I've done an enterprise software company. And there are good things about it. But the bad thing is that you have these kind of long extended sales cycles, you have a high degree of influence from your larger customers on the product roadmap and things like that. that. And quite frankly, it's just not that fun. You're serving the fortune 500. And it's kind of very niche.
9:23It's just I didn't find it to be that fun. It's lucrative. At least it was back in the day and probably still is. And so if you look at the other modality, right, so you can have like, serve the fortune 500, or you can build a consumer app, consumer software company. The issue with consumer software companies is that they have very bi-modal outcomes, either you're the next Facebook, the next Google, the next whatever, and you're worth a bazillion dollars or you're nothing at all. It's hard to incrementally build something in the consumer world because often it's subsidized through advertising and things like that.
9:52And the nice thing about SMB is that it has the elements of both. It's got the elements of enterprise software where you can solve a problem and charge money for a product the old-fashioned way and make money that way. But it's got the scale of consumer where there's millions of businesses out there. You don't have revenue concentration. You can control your destiny. So once you sort of figured out how to make the physics and the math work, it's actually a fun kind of business to run and grow. That's kind of part number one. That's the analytical side of me saying this is a reason to be an SMB.
10:22The emotional side of me is we thought there was an underserved market. Both my co-founder and I are kind of champions of small business, hence my kind of startup investment activity. And there are enough companies catering to the Fortune 500. Those folks will always have options. we wanted to create something that helped like in our kind of early version was primarily marketing software, which is, oh, there's this new thing called the internet and every small business should be benefiting from it. And not enough were. So we're like, how do we democratize access to this kind of new technology?
10:53How do we educate? How do we build products that are easy enough to use for people to kind of benefit from this thing called the internet? And we've kind of stuck to that mission for all 17 years, which is, you know, how do we help millions of organizations grow better using the internet and using whatever technology happens to be available at the time. If you're a SaaS or services company that stores customer data in the cloud, then you need to be a SOC 2 compliant, you know that from a third party and you need that third party to close big deals. And if you want to get compliant easier and faster, you need to use Vanta V A N T A Vanta makes it so easy for you to get and renew your SOC 2.
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12:06And tight is right. Lock down those big deals. Here's the best part. Vanta is going to give you$1 ,000 off. That's 10 hundies. Get$1 ,000 off at vanta.com slash twist. That's vanta.com slash twist for$1 ,000 off your SOC 2. It's also a huge blue ocean. People don't want to take on the small players because it's not enough revenue. That's exactly right. If you have a thousand people, a thousand seats or three seats, well, you're going to play for the long ball and try to spend the extra six months to get the thousand seats as opposed to trying to get 333 people to sign up for three seats each. Yes.
12:41But man, if you do make it work, there's nothing like a startup that enables somebody to create a business. Shopify, eBay, Airbnb, Etsy. Yeah. Gosh. Even, you know, to a lesser extent, Uber, DoorDash, like people create, you know, sort of micro businesses. These businesses are just amazing in terms of the amount of creativity, the people who you enable, because then that informs the product, doesn't it? people start using your product in ways that you probably didn't anticipate and they are this incredible focus group you know that's that's the great thing about having these really um you know what's the word you know they're really scrappy yes so they're gonna they're gonna give you some great ideas i'm sure some of the best ideas have come from the customers most um yeah and so hub spot has you know 170 000 plus customers now right and had we been in the enterprise market that would have been more like 1700, right?
13:40Like a multiple hours of magnitude difference. So we get all the better. And it's just a lot of fun because I'm a big believer in terms of product development and fast iterations, short feedback loops, being able to act on things. And when you have thousands of customers, you know, joining every month, you're able to then kind of get that feedback very consistently, get ideas in, kind of iterate on the product. You're not dealing with six month, 12 month sales cycles and figuring out whether something will or will not work. You can run better experiments. Yeah, just lots of positive to it. Once you can make the math work, it's and for all folks in your in the audience listening, if we were having this conversation, let's say 15 years ago, been our early years of HubSpot, you know, I would say, okay, well, you know, it still remains to be seen whether HubSpot is successful or not.
14:26And SMB is hard. So I wouldn't recommend it. Now I would actually recommend it. Because especially as a startup, right, if you look, so in the kind of 90s and 2000s, when I first kind of got started in in software and tech, enterprise software was on a relative basis, relatively easier. But now we've gotten, I'll say like a glut of products, very, very discerning buyers, you don't, it's hard to kind of make money and kind of get things through as it once was in the 90s. And so for a startup, it's like, okay, you're, you're getting out, it's like, if it's going to take you three, six, nine, 12 months to kind of get those early customers, and you're trying to iterate and maybe pivot if you need to.
15:06Doing that in the enterprise market is really hard doing that in SMB is much easier. And one of the reasons that made SMB so hard is they were expensive to get to back then. Yes, it was just hard to reach them. How do you make the kind of knock on the door? I mean, that was traveling sales. You know, that was out there. And literally, that was actually determined. Now that I remember you had inside sales and outside sales and outside sales was knock on doors. And there were so many of them back in the 90s. It's a little no solicitations, please. Do not come in here and sell something. Now that we have Shopify, there's HubSpot, there's ProofPoint.
15:38So even if you're raising money, which we can talk about that, whether the good and bad of venture capital, but I think SMB is still a vibrant market for entrepreneurs to kind of tackle because it's easy to get started. Everyone knows 20 people that are entrepreneurs or small businesses, you know, we're one degree removed. So they're not some sitting in some ivory tower that you're going to spend six months just trying to get a meeting with the the decision maker the decision maker is usually the founder ceo and it's um it's much easier it's much much more fun business so yeah i suppose the small businesses too do not have cycles to waste so you can get to a very quick decision i need this i don't need this i don't have time for this whereas if you go to a big company and i worked at a big company for like a minute or two aol and sony uh selling one company and then starting my career and last a year at each um there would be meetings and committees and there were middle managers who i realized all they did was go to meetings all day and i was like what what do you do and i go to meetings and i don't know you saw toby's awesome at shopify's awesome calculator this week this meeting cost two thousand dollars yeah that was awesome they should put that meeting on whoever uh sets up the meeting it should be billed to their department they should get the bill for that you know if you're going to pull in six developers for$200 an hour or whatever they cost, she gets a bill for it.
17:02It's not just that they're having kind of meetings and they have these committees, they have this, like you need just one relatively influential person in the company that's going to say no, that can veto that pop, you know, that potential deal for whatever, whatever reason, right? It could be, you know, stay in the market. And so you're just kind of jumping through these, you know, 12 flaming hoops, hoping that, okay, I got through this committee, I got this person to approve it. I've got my champion doing this, whatever. And then ultimately, maybe you get a sale six, 12 months in. Whereas in the small business world, it's like you've got one person who's generally an optimist.
17:33They're an entrepreneur. They took a risk. They're used to that. You don't have people whose entire job or most of their job is saying no to things, right? That's not which in the enterprise world you get all the time. Let's widen the discussion here. What is your advice to founders or potential founders, not people who have done it before, but people who haven't? we have massive layoffs in tech um i don't have here in my notes if you did a riff but i'm assuming you probably did if you were part of the uh over hiring trend we were all hiring for explosive growth we'd be interested to hear your thoughts on the lessons there but putting that aside a lot of people had jobs at uber or google or microsoft suddenly find themselves with a decade of experience and two or three friends who uh were getting paid ginormous salaries huge options and now they don't have four offers uh competing for their services they got zero yep so some of them are looking on huh these offers aren't great maybe i should start a company best reason to start a company who should start a company why should they start a company so i think two reasons to start a company i don't think uh that should be one of them i mean if you were already considering it uh that can be one of the factors this is okay well my opportunity cost was too high i've had good ideas but the two reasons to start is you've got a passion for a particular kind of problem that you want to solve in the world, you know, for whatever, you know, set of customers, or you've got a set of people that you know that you'd love to work with and do something with, right?
19:02And HubSpot actually falls in the latter camp. HubSpot, we had, we had not actually decided on what the final idea was going to be until after we started the company. The first decision we made was that Brian, I, my co-founder and I, we're actually going to start something. And it's like we were loosely, we were looking at several ideas. One was going to be like an Oracle for SMBs, like an ERP kind of thing. We've looked at marketing. And so my advice to founders here would be like on the idea front, I'll give you my kind of quick framework for, we'll talk about the idea and we can talk about kind of founder selection.
19:36On the idea front, one of the mistakes I think would-be entrepreneurs make is they assume that in order to kind of take the leap of faith and start a startup, they have to have this really great, perfect idea. And I don't think that's true. And even if you happen to have a really great, near perfect idea, you wouldn't know it a priori at the time. Until you start a company, the greatness of the idea does not really reveal itself. And often, if you study startup history, a lot of the success stories that we've seen actually became successful for an idea that was not the original founding idea. right they kind of pivoted along the way and something very different happened over over time either a full-on pivot or at least incrementally the company looks very different from the early idea so the corollary here would be is like okay well if most successful startups end up with an idea that was not the original idea then how much does that original idea matter should that preclude you um from from starting okay so that's kind of a very important insight i think for founders to understand because as you said hey if you got three people you like to play music with then just start playing music start the band you know you're gonna love it and the truth is even when you start with an idea that you're super passionate about in greater than 50 of chances you thought you were starting a jazz trio and you made a you know and uh you know uh you know a rock band or a southern rock band whatever it is you'll you'll find your sound and you'll find it by doing it you have to play the music and so waiting for the perfect idea is the enemy of success in a lot of ways.
21:09Yeah. Well, and waiting for the perfect idea is actually the barrier to finding the perfect idea. And even better happens after you start, once you come into contact with customers, the market, you work together, and you start, I love your analogy, as you start playing is when you kind of really discover, kind of discover yourself and what's what's out there. So let's, let's talk a little bit, I think about, you know, ways I use to kind of assess an idea. And I think in frameworks a little bit. So there's, I think, three things to look at. And there's a common mistake that happens. One is the potential that particular idea has.
21:42So let's say everything goes your way. It's like everything works. It's like you execute and things happen. What could this potentially be? What's the overall potential magnitude of the outcome here? And there's no right or wrong answer based on if this is your third startup versus your first one, things vary. But that's thing number one is what's the overall potential. The second thing is, what's the probability of success of achieving that potential? How hard is this to actually execute on and get to the actual potential? The mistake I think entrepreneurs make is they start with the probability question, what are the likelihood of me pulling this off?
22:18And if that's too low, they never even think about the potential. And you play poker and are into stats and kinds of things. For instance, if you have a 10 % chance at a billion dollar outcome, The expected value of that is 10 % of$1 billion. It's worth$100 million. Just putting everything else on the side, all things being equal. If you have a 50 % chance at a million-dollar outcome, yes, you have 50 % chance at a million. That's worth$500 ,000, worth far less. Now, obviously, a lot of it has to do with what you can put at risk and all those things. But all things being equal, just putting an idea aside simply because the probability is too low is short-sighted.
22:55You should also look at, number one, what's the potential? And the last thing is, to what degree do you have passion or proximity to this idea? Don't just pick it based on those numbers to say, oh, I really have a passion for solving this problem, or I've been working in this particular area for a long time, I've got what I call proximity. So a combination of those three things helps you pick amongst the ideas that you might pursue. Look at the right mix of, okay, here's something I'm passionate about that's got decent potential and is a level of risk in terms of the probability that I'm willing to accept.
23:26And then you kind of pursue it. All right, we all know the one thing that separates great startups from the good ones is product velocity. What does it mean product velocity? Fancy term, right? Here you got your product and your velocity speed, the speed in which your product improves. So can you ship updates? Can you release new features? Can you do bug fixes? Can you iterate on the interface? Can you solve problems for your customers? And can you do it quickly? Because you're not alone, You have competitors and your customers have choices. They may solve their problems by writing their own custom code, or they might use your solution.
24:02This is what startups are about. How fast can you get that product velocity going? And so, you know, how do you supercharge it? Everybody says, okay, yeah, we want to go faster, but you got to go faster intelligently. And Crowdbotics is going to help you do that. They're your CTO as a service. Basically, they provide you with the most optimal architecture to get your product to market as fast as possible. You'll have access to an on-demand product manager and developer talent, and they will help get your app into production 10 times faster than conventional development. Crowdbotics can work with your in-house dev team, or you can just have them work independently.
24:34And you own all the IP. You own all the source code. Let the folks at Crowdbotics supercharge your product velocity today. No more waiting. Get a free build plan at crowdbotics.com. That's a$4.99 value just for the Twist listeners. You get that for free. That's C-R-O-W-D-B-O-T-I-C-S dot com slash twist for a free build plan. It's such a great framework. I think one of the things I've seen over and over again is people will pitch me what is essentially a service business, you know, maybe in a wrapper with a little bit of software or software enabled services, whatever. and if you think about the expected value something we talk about in poker um if i do call this bet and i or and i do hit it on the river or i do hit my magic card on the turn do i get that person's whole stack do i get three people's whole stack is everybody going to come in you really have to think about that and what i tell founders uh you know which is largely based on your framework here is you're going to put in 60 70 80 hours a week for your startup it's just the nature of it it's going to be all encompassing if you're an entrepreneur you're going to put everything you got into it if you put everything you have into a service business you're going to get it to 10 million dollars a year in revenue if you put everything you got you know into a software business or a marketplace uh or a fintech company and you know pick a platform company you know the the potential revenue is billions of dollars and there's just a natural cap to some businesses you pick d to c it's going to be a low margin grind yeah sure you get a bow and branch once in a while or an eight sleep there there are outliers that can do it but man it's hard and then i love yours passion and proximity to the idea.
26:10Yeah. The other thing is, especially if you're early in your entrepreneurial career, let's say you're doing your first one. The other reason to lean a little bit more towards potential for the idea is that you want several, if you can, several steps up to bat. So you may not get it exactly right the first time, right? But if you do a service business, you're sort of in there for the grind, you're going to be there for 5, 10, 15, 20 years. And that's sort of going to be it. It's not going to probably die, right? It's going to make revenue. You'll have a comfortable living, but it's unlikely you're going to have this kind of breakout success, which is okay.
26:41There's nothing wrong with that. But, you know, if you really feel like this kind of entrepreneurial drive to kind of take your swinging bat and swing for the fences, you're better off doing a product-oriented company. And as it turns out, in my experience, and this is a little bit paradoxical, it's often easier to pursue a larger idea than a smaller one. And the reason is that a larger idea will attract better people that are more ambitious, that will kind of thrive on that challenge. Like, oh, we're going to do this thing that's really, really hard. That's the way to get people into the company that will help you increase the odds of your success.
27:18Whereas if you're going at a, oh, we have a high potential. It's like a 70%. We're going to all make money here. It's going to be$1 million,$5 million, whatever it is. That's fine. But you're going to find other people that are kind of mitigating risk a little bit too early. so if you're kind of an entrepreneur career you know as much as you're kind of willing to stomach uh nice i'd say take your shot right like in this of course you you i mean and when you get to our age you and i uh got the gray hairs coming in uh you realize more and more that the finite commodity in the world is time and you have a certain amount of time to get this done and to just build off of our you know jam band uh analogy here you know if you say hey i'm i'm looking for some studio musicians to play backup at the studio and i'm going to open a studio and we're going to do backup musician you're going to get a certain type of person a conservative person who wants a steady salary if you say hey i want to i want to build the largest rock and roll band in the world and go on tour and do stadiums and have the number one hits you're going to get people who are like yeah let's do it and one group of people is going to write their own music and wants to write their own songs and own the ip and go big and the other group wants to punch a clock and get out of there on time and you know the more i look at it i feel like there are people in the world who are wired for either group and a lot of the tension in our society that we see the anti-capitalist kind of underpinnings that we see in the united states today or clearly in europe or wealth disparity a lot of it has to do with this live to work work to live or my life is my work and this disconnect that people just don't understand that for entrepreneurs there is no other way they have to be building something they have to be the person playing lead guitar, they have to be the lead singer, they can't play any other role.
29:04You think that's right? Do you think like, there's just different people in the world? Yeah, this is, it's not a popular opinion, but I'll put it out there. Anyway, you know, HubSpot has 7000 people. And we have the entire broad spectrum of people at various stages of life, various temperaments, which is great. Well, that's one of the values to scale is that we can kind of support whichever modality you have. So there are people that are kind of like, I want, you know, more balance in my life, I want this, I want, and that's fine. I think that's totally okay. Where start things start to not be okay, is when you pick a particular mode, that is incongruous with what your expectations are.
29:43So let me give an example. In every competitive endeavor that humans will ever undertake, there's always sacrifice to be in the kind of top 1%, top 0.1 % as far as outcomes, right? If you're in the Olympics, you don't say, you know what, I was born with this talent, I can really run fast or jump high or whatever. And so I don't really have to work all that hard, because I've got all this talent, no one shows up for the Olympics without sacrifice without having getting to that point. And even then continuing to do that as an Olympic athlete, same for music, same for any competitive endeavor, right, where you're trying to be in this kind of small, small percentage of outliers.
30:17And not everyone necessarily needs to do that. But it's like, if you're expecting the outcome of one of those outliers, but you're not willing to make that sacrifice, that's when conflict starts to occur. It's like, okay, well, you know, it's fine to pick one path or the other. But you can't say, well, you know, I want hundreds of 1000s of adoring fans. But also, I really don't want to practice, you know, five times a week or seven times a week. I don't want to be famous. I want to have 80 ,000 people pay$200 a ticket for my show. I'm Taylor Swift. I want to go on a tour. But I don't want people to ask for a selfie.
30:47It's like, you're gonna get asked for a selfie. you know what to her credit she does that fan service but there are people who are like they want it they don't want it mark knoffler from dire straits man they when they hit the peak and they were the largest tour uh in the world they had two different sets and this is when he said when you own your own stage that's when you know it's gotten too far and they owned two stages and in san paulo in brazil and then in venezuela argentina mexico you know southern california the stages were moving while they were playing three nights at the next place and they were doing 250 gigs a year they were printing money but he said it was now a beast and he just disbanded dire dire straits at the peak to become you know a folk singer basically and he did his solo albums and i still love him for both eras miss dire straits but i think you do need to know it's like the it's the it's the absolute perfect example if you if your expectations are set right and at a big company you need people um who are steady and long term and you don't need them to come in every weekend go go if you're the sales team and you hit your numbers god bless spend time with your kids if you got to leave at 4 35 30 pick up your kids that's that's great but in my when you were a 19 person hub spot i guarantee you people were there at 10 o 'clock at night on the weekends yeah yeah yes and and one one thing to be clear on is that you know i'm not like a big fan of kind of the aggressive hustle, hustle culture, right?
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32:17It's like you, there are times where you need to kind of spike if you've got some deliverable, but that in my mind is not long-term sustainable. So, you know, I've been an entrepreneur for 30 years now across, you know, HubSpot's my third startup. I've always valued sleep. You know, my average sleep time, which I've tracked is, you know, has approximated like seven to seven and a half hours for all those 30 years. Right. So I don't, and it's not that I don't work hard. It's not that I'm not committed or whatever, but it's, So you have to find that balance. Same thing, once again, going back, I have never played professional sports of any kind, or sports of any kind for that matter.
32:53But Olympic athletes also recognize that it's unhealthy and they cannot sustain. It's like, oh, they're not going to go practice 14 hours for eight days straight or whatever. It's going to harm their body. Diminishing returns. Yeah, or negative returns, not even just diminishing. You get no returns. It actually causes you harm. Injure yourself, right? Yeah, exactly. yeah i i have gotten wise about this in my my older years i you know as a we're i guess 19 person company now for our investment firm that also does a podcast and i tell everybody if we want to be great it's a fixed 50 solid 60 a week to be really great in venture i think servicing companies but if you start getting to 70 80 hours a week you're going to resent the job you're going to quit so just you know it doesn't have to be a marathon every week but it's got to be a brisk pace and then what i look at more is how responsive are you to the founders we invest in you know when they need us so if they call on a saturday night or they have a term sheet on a sunday are you the type of person who will respond or do we leave them out in the cold on the weekend and you know the maturation i've had is not being resentful of people who don't want that yeah it's informing people on the way in that that's how it is and there's 10 or 20 of people who want that and then when i take those 20 of people in half of them didn't realize they don't want it yeah and so you keep half the people you hire and i think that's probably i think okay um do you worry in society right now about the sort of anti-capitalist kind of sentiment going on here and this bifurcation where you know you and i grew up we're both i think exactly the same age i was born 1970 i have a 30 year career as well so i'm what year were you born uh 67 okay so you were like literally within three years of each other and and we grew up in a time uh when we were in our teens where steve jobs and bill gates and mitch kapoor and just like it was incredible like these were incredible entrepreneurs crushing it and they were idolized and studied you know and it was the best of america now we're in this weird place where it's like yeah um the standard of living is better than it's ever been but uh you won so somehow you either cheated or you don't deserve it um when we have to sort of maybe vilify people who succeed um what do you think about all this you concern at all it does i think it's very real that kind of kind of divided um culture we've you know seen that show up in all sorts of different places um but like the optimist in me um believes that over over the fullness of time that we go through these cycles um and that we will as a society kind of figure out um that and maybe this one's lasting longer than anyone would have liked but that there is a like a truth function at the end of it all that says like here's the thing that makes sense is as a as a species that likes to achieve likes to produce likes to progress um like here's what that means And, you know, for those that are, you know, against capitalism, we've tried a bunch of other possible systems.
35:54I'm not particularly politically savvy, but they haven't really worked. Right. So it's, you know, the so anyway, I'm a big believer. And this is just my innate personality is I'm a builder. I like to build things. And I think. Yeah, society will value that. It's yeah, it's right now. It's an odd time in the world. Isn't it? It's very strange. Yeah, so much tension. and uh i think it does not need to be that way because um objectively the standard of living has just increased the sense of safety uh actual safety in the world if you read steven pinker's work is just a chance of being murdered or attacked and violently dying or being incarcerated unfairly you know we know of all the cases when it does happen and we put them onto social media becomes the number one story of the day so our brains are now getting programmed to see all the horribleness in the world the edge cases essentially and we just don't see the average case uh that you know the the incredible bounty we have and that things just keep getting better and better and better yeah i just i met stephen pinker i think earlier this year a small gathering and so if for those listening once again uh read pinker's enlightenment now if you really want to kind of understand objectively why we should be optimists and feeling positive about where we are versus where we used to be um that's a very good well thought out um book on things are better like as much as they may uh seem like they're not so yeah i just think it's the the the media both social and mainstream that has just taken us down this terrible path where you doom scroll and you see all the bad things and your feed is people fighting on the street or karen's ratting out of people and social injustice and everything and you're you just believe that's the default state yeah when actually the default state is you know most americans actually get along and if you met a couple of republicans and democrats and independents religious people atheists could all sit and have a piece of pie together and a cup of coffee and have a grand old time yeah uh and that's why and people are like how could you be friends with david sacks i'm like because we have a hilarious fun time together right you know like because we love each other we have a great time and they're like but you disagree and it's like okay over what ice cream flavors beverages politics who cares all right you know i've been on a health kick over the past year and you know i care about data-driven solutions and if you listen to this podcast i bet you do too so let me tell you about fitbot this is a data-driven workout app that blends machine learning with exercise science fitbot creates custom dynamic workouts programs based on your fitness goals your experience.
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39:05FitBod can create a perfectly optimized workout for me based on these parameters. And it will do it for you to check it out. It's amazing. The design of this app is extraordinary. I was able to invest in it. That's how impressed I was with it. FitBod takes the guest workout of fitness. Just open the app and start making progress. You deserve it. Get 25 % off your FitBod subscription or try out the app for free when you sign up now at FitBod.me slash twist. That's FITBOD.ME slash TWIST for 25 % off. What about the downturn and starting a business in the trow, which you and I have done, and we've invested in businesses in the trow.
39:49It's a little bit counterintuitive, is it not? It is. But in my mind, the oscillations of the market, upturns, downturns, there's really never a bad time to start a business. There are bad reasons to start a business. If you're saying, oh, I'm going to do this because I want to make millions of dollars, there are easier ways to make millions of dollars with higher likelihood of success based on your background and things like that. But in terms of down market versus up market, I think the net of it is I think we've seen, and there's probably data that exists somewhere, that the number of startups and successful startups that were started in down years or whatever is probably comparable.
40:31I don't think there's two standard deviations of difference between one versus the other. So right now, I think, and we'll have to talk about AI at some point because I think that's the other thing. Next question. Let's do it. To me, it's less about the economic kind of movements and the fluctuations which we see. Because, you know, in the downturn, there, you know, there are bad things, right? It's like, obviously, it's like things are hard, customers are hard to get to people are not spending money. People are tightening their belts, their austerity measures being put in place, people don't want to spend money.
41:01On the positive side, right? Rents are cheaper, access to talent is more readily available. People that may never have considered joining a startup because they work for Facebook or whatever. now would do that so the pool of talent that you have available to now is is much better than you would have had in a kind of uh booming up economy so let's we'll stipulate for now and i could be wrong that those things kind of cancel each other out i would agree with that they balance each other yeah well yeah let's let's i literally was looking at an office space yesterday like i'm looking for a place for my startup accelerator and i was gonna have a little garage um and they wanted two dollars change a square foot per month and the guy told me like you know there's like places that have three dollar a square foot class a office space yeah and i was like really he's like they'll do anything to get anybody yeah uh at one third the price i was like wow that's incredible i could literally be sitting in a class a office space with views of the bay for three bucks a month yeah hilarious um but yeah you're totally right and then ai puts this huge wrinkle into it what's the number one impact AI is going to have on running a business in your mind?
42:11I think it's going to have positive impact because as technologies in the past have done, at any time we've seen kind of major shifts in the technology paradigm, it basically lifts productivity, it allows us to, quote unquote, produce more, build more than we were able to do before. So I think it's going to be kind of a net boon. I think in the short run, it's going to, as things have done in the past, you know, create, create some pain for pockets of people and pockets of businesses. But on the whole, I think it's going to help. I think it's, it's sort of like, you know, when first, you know, when computers first came along, there were a lot of things that went from kind of manual to being digitized.
42:51It's like, oh, now I can do this. I have something called a spreadsheet that lets me as an accounting person or whatever, do things much more productively. So I, you know, possibly need fewer accounts, We'll come back and talk about that. The internet came along and opened up another kind of pool of things that could be done now that were possible when everyone wasn't connected. And I think AI is another thing sort of like that, which is it kind of amplifies what can be done and the kinds of things we can automate. And to me right now, it's less about kind of automating people away. It's about automating tasks.
43:24So the way I think about it, it's like if I were to walk into or chat with Zoom was more likely someone at HubSpot is like, by the way, you know, I'm going to give you budget to hire two assistants because you're doing a great job. And I need you to help me more with this thing that has more impact on the business and higher value that I think you're exceptionally good at. But hiring the two assistants will free up your time. If I went there, they would see that as a unequivocally positive thing. It's like, yeah, of course, I can use two assistants because I do all this thing, whether it's meeting notes, whatever is scheduling.
43:55That's where the AI we should think of as that. It's like you're going to now be able to hire assistants, quote unquote, in the form of software that will do things that were taking up time that were either rote, that were repetitive, that did not require your degree of acumen and creativity, thereby freeing up your time to be able to work on those things and create more value. And over the, once again, the fullness of time, the value that you as an individual derive from the company, derive from the market at large is a function of the value that you create. it's going to be some fraction thereof right um and this allows you to kind of raise that value that you're kind of contributing uh to the business or to society so yeah uh we had a name for this in the 80s and 90s that you well know uh business process automation bpa yeah and there were gartner group or i don't know consultants going around boston consulting group they would study your business ibm would come in and they'd say okay this piece of paper workflow lotus notes all these pieces of software this is how this piece of paper runs from the ninth floor to the seventh floor and then down to the typing pool and the backup to the ceo's desk and gets filed and they're like we can actually do that on a piece of software and my initial reaction to all of this amazing uh chat gtp 4.0 and software i made everybody buy it in the organization because you only buy it personally 20 bucks each 400 bucks a month five thousand dollars a year and we use notions ai and some other ai assistance and um i have them look at the tasks they do every day and they said start sharing because you can share on chat gpt start sharing when you do your end of day report we do like a little start of day end of day report uh to keep each other accountable in slack i said i want you to link to your chat gpt threads and if you don't do any that's okay but other people can suggest to you you know hey i should do that and we had one person who's ambitious in the company brian and he did it for the sales team and he showed them when they were doing some event sales hey here's how i would do these prompts and like i saw the sales people's heads go like that was four hours of work yeah and once you start getting into this i don't know if you've been doing like the prompt have you started doing like prompt optimization yet oh yeah i am deep down that rabbit hole jason oh boy is this exciting you are an seo expert you are an event i literally did this for my event because i come up with creative ideas like all in summit parties and so like that and i was like you're an event manager you're doing a james bond theme party what are some activation stations that would delight the customers and make it memorable it was like you should do casino games you should do a photo booth and i was like yep that's everything i would have suggested and then there were three that i was like didn't think of that yep let's do those two so what have you gotten to that's the role what do they call that like role something in prompting agent based things i think is agent oh agent based thing yeah so you set up a role you are a lawyer you are an seo what else have you started to learn here?
46:42So I think, so the evolution has been, you know, when we first, and it feels like an eternity ago, but in December, yeah, it was a kind of a single shot. You kind of typed in a prompt and you got a response back. Then chat GPT launched in November of 2022 last year. And that made it more conversational. So you could actually have a back and forth and say, oh, well, give me that, but tweak this or do this or do this, right? So it's a multi-step thing. I think the next wave of evolution is going to be around moving to this truly agent-based thing that says you have higher order goals or tasks. Instead of saying, oh, write me a blog post, it's like, I'm going to launch a new event in six months.
47:26So it can then functionally decompose that task and say, here's the thing I'm trying to do. Okay, well, in order to do that, we need a social media strategy. We need this. We need a website. We need this. It's like, okay, for a social media strategy, we need these five things. We need to figure out which channels, whatever. Now we need a calendar that we're going to, it's like it can continually go down. And over time, so in the early days, maybe it just gives you a list of things broken down, like in the kind of tree. Here's the kind of the project map. Over time, more and more of those tasks that need to be done can just simply be done in an automated way.
47:57So I think what we're going to do is kind of raise the level of abstraction that we work in instead of having this very kind of task oriented. the task oriented thing is like having a really super smart intern. Brilliant, really quick, picks things up very quickly, is well read, well knowledgeable. Go get a Starbucks for everybody. Give them very detailed instructions in order to really get the thing that you want. And what we're going to move to is kind of a higher order, someone that can have discretion, someone that can look at their own output and say, yeah, I did this, but it's not quite that good yet.
48:29And I think we talked about role based things. So imagine agents, and there's like here's how i think about it i'll stop after this one but um keep going you're cooking right now um what i think of is like like creator agents right that's what we sort of know right now is like someone that can write an agent that can write a blog post can uh do or create an image marketing plan like a graphic designer yep then there are um what i think of as like curator agents and what curator agents are is like oh i have these automated agents go off and create a hundred different designs for my slide deck for this cover image because it's super important or from my blog post, whatever it is, the curator says, I don't know how to create things, but I know how to pick the best one based on the context that I have available about the business, right?
49:09So and you can separate those two things. One creates the other one picks of the of the creations. And that's sort of what we do as humans. And the third one is around coordination, to say, Okay, I have access to creators, I have access to curators. And either is a kind of master agent, like a manager, almost that says, I'm going to try and put all these pieces together and get the output in a form that is optimal for you. It's like, okay, well, I don't just want a list of my competitors and a competitive strategy or how it's like, I want a 30-page PDF that actually gives me, like a McKinsey report might do, and gives me all those things.
49:40And I don't know or need to know all the pieces that had to come together and kind of deliver on that kind of high order desired outcome. And I think that's where we're... And we're still very, very early in that evolution. But the rate at which things are moving, this is the thing. It's like, okay, well, three years ago, had we described to someone what was now possible that we know is possible because we use it every day, right? A hundred million people have been exposed to it. They would have thought, oh, no, no, that's going to be decades out. That's what everyone was saying, right? And so this kind of thing, this kind of agent-based model, in a normal world, I would have said maybe that's 5, 10, 20 years out.
50:17No, I'm not so sure. 5, 10, 20 months out is probably. So we'll see. i think the way you framed it is exactly correct um what i've learned is that you start to think of this as like you're saying the intern or the associate hey here are some tasks i don't want to do them find me you know locations for the event write a couple blog posts find a list of speakers but then hey you're an event producer make me a marketing plan okay now execute on the marketing plan and hey we have somebody who's our metrics person look at the signups look at the data and tell me when we look at that data um how we should change the marketing plan so now we're at a different thing the data is coming in and it's reacting to its own marketing plan and learning and when we get to that phase where you have multiple agents as you're sort of sort of envisioning here which i think is next year sometime um now everybody in the organization's job i would say between 30 and 75 percent of what people do on a task basis gets abstracted away you think i'm about right in terms of percentages you're probably right um either on the percentage or the timeline, maybe both.
51:23We'll see. It's moving really quickly. So one thing I think in terms of the here and now, the stuff that's already here and already happening. So right now, a lot of the excitement in generative AI is around, because the word generative, around generating things that are meant for humans. It's like, oh, I'm going to generate a blog post, I'm going to generate image, I'm going to generate audio, video, whatever happens to me. And that's where 90 % of the energy and excitement is. I think 90 % of the opportunity is around generative AI models being used to generate things that computers will actually use not humans I mean by this is that um for the entire history of the software industry that as long as I've known it which has been a long time most software companies will say oh we create like easy to use simple intuitive UI right that's um we'll say that and the truth is um it's not intuitive at all because every piece of software that has existed it's like okay well You have the thing you're trying to do in your head that says, oh, I want to do this in Photoshop, or I want to do this in HubSpot.
52:23I want a report of all my customers last quarter from Europe that spent more than$5 ,000, whatever it happens to be. You have to take that question that you have in your head, your intent, and translate that into a series of clicks and drags and swipes and touches. And you have to have some knowledge of the software that you're using. That's not intuitive at all. No. What generative AI now makes possible for the first time in human history is to compress that gap. So right now, most software works in what I call engineers would call an imperative model. You go step by step. It's like I go to this screen and I then type this in and I click that button.
52:56I drag this over here and then ultimately I get the thing I'm looking for. That's the imperative model. Step by step. Here's what I'm going to need to do. Generative AI makes possible a declarative model. The declarative model says, just tell me what you want. I want a report of all my customers from Europe that spent more than$5 ,000 last quarter. and you express that exactly as it's in your head and you just type that in or you say it doesn't really matter. And now the software can produce that outcome because it can take that natural language, translate it into effectively code. So imagine you have a really smart, super capable developer just sitting at your beck and call.
53:35It's like, oh, just write the code for me. I don't know if it exists in the spot or you can go do that and then run that code in real time. It's a single use one time. So every prompt that you type in is an on the fly app being generated effectively and then run in real time that gets the data you want and gives it back to you and that's the world we're living in now that's the thing i'm kind of personally very excited about and working on myself so you're writing code yourself i hear i am every night until 2 a.m every night i'm so excited wow most excited i've been about anything uh work related uh you know it's so interesting i am doing a secret project at inside.com i won't talk about it but it's my newsletter business i'll talk to you about it offline and get your thoughts um and i am super engaged i'm like hanging out with five or six developers and i'm doing crazy prompt engineering and i'm like hmm how is the news business going to change i'm like i have some ideas you start thinking about agents you start thinking about journalists and fact checkers and all this stuff like you start to think huh maybe ai on news could do some good in the world and let me see how i can make people even faster and better at all of that and um the thing that i find it super exciting i'm sure you do as well is internally um i've asked people before we write a job rec i want to see how much of the job could be done with software specifically ai and then let's look at everybody's job in the company and if everybody gets 30 better a year about 30 that means every two years you've doubled your set right because the rule is 72 if you know compounding interest so that to me is going to lead to an efficiency in organizations like you mentioned earlier like cloud computing edit you don't have to rack and stack or we work you don't have to get a huge lease and put a letter of credit down uh you don't have to write uh the twilio api if you want to do stuff you don't have to write a story you don't have to put up storage if you use s3 or whatever it's kind of really interesting to me the efficiency that could be coming from organizations that embrace this.
55:40Are you seeing something similar? I think that should make us optimistic. And this is... So imagine we woke up tomorrow, and this is actually true, and all the developers at HubSpot started using GitHub Copilot and were, let's say, 25 % more productive. Does that mean we're going to hire 25 % fewer developers? And the answer is no. If all of a sudden salespeople became 25 % more productive, does that mean HubSpot hires 25 % fewer salespeople? The answer is no. Actually, my inclination to hire developers that are 25 % more productive than they are now, I would hire more developers because the opportunity is out there.
56:13Same for sales. Same for most things because there's not a finite opportunity that you're dividing up between the humans that are available. It's like, oh, the only reason we have X number of developers is in order for me to get a return on that developer time based on their costs. I'd have to produce Y amount of software or make Z number of sales for salespeople. if I can drive that efficiency up, I think it increases our investment in humans that can do those things because those humans are more productive and more efficient. That's why. You would feel more confident hiring the next 10 developers, knowing you're not going to have to sort through them, monitor them to make sure that they actually get enough done or the salespeople.
56:48Even somebody who maybe was a little bit of a neophyte or a little bit more green as a salesperson, I think they quickly catch up, right? so i think the the cons what the margins are on business is going to be pretty phenomenal and the number of people it takes to start a company and therefore the number of long tail opportunities like did we ever think there would be a market for a meditation app com.com is people don't know this my return on com.com because i own you know over five percent of the company will be greater than my uber return even though it's 50 times bigger because i own so much less of uber um and you start looking at like could a meditation app ever be built not before web 2.0 in the app store now you think well what's further down you know the long tail like the pickup you know the golf app the you know whatever paddleboard out you know i think just there are so many great ideas there that could become a 10 million or 25 million dollar business that we would never pursue as venture capitalists or investors but you know if it only takes five people to get it there that's probably worth doing uh and it will be so so much um easier and you start thinking about your growth i mean you guys have had spectacular consistent growth since inception listen you can't make forward-looking statements but i can't um i think for sas businesses that control costs and then deploy this i that's why i'm buying a lot of public at scale companies stocks uh even as a i have access to the greatest private companies but the public companies i think are undervalued in some cases because of ai and the the amount they're going to get done with less yeah and then it's not and there's two parts and i agree with all of that which is you know sas companies um you know will become more efficient and i think that'll be great but the other thing that ai opens up is allowing uh software companies to do things that weren't really possible before or it's not a matter of efficiency or making something 25 or 50 percent more uh productive more efficient it's like what are the things and we're thinking about this you every day now, like, okay, well, as a CRM platform company, what can we now make available to customers that two years ago, just couldn't be done, like at any price, this was not possible, new opportunity for new products, new services.
58:56So I think I'm very bullish on the opportunity, especially for entrepreneurs, this is a great time, learn about AI, figure out where the gaps are, find some target market, everyone just like the internet was back in the day, it left no business untouched, right? Like now, it's like, okay, I will leave no industry, no business untouched um and there's a ocean of opportunity out there it's an exciting time yeah it's it's so clear to me that you're 100 correct on this and i just look at where developers and entrepreneurs start moving their energy and i think there's like pre um 2023 or pre let's say chat gpt we'll give them credit at open ai pre-chat gpt uh 3.5 enabled stuff and post i won't give the exact um startup idea here but i got somebody in the accelerator and their business is based upon meetings that occur in the world now these meetings are there's a lot of them going on and they're hours long and while the videos exist of these meetings uh and access to them is public the transcripts and the analysis is not right to put analysts on these tiny little meetings that are occurring would be cost prohibitive there's no way you would ever do it and just even the transcribing it or i was pitched a couple years ago somebody said hey i can take this week in startups and i can dub somebody speaking spanish and have somebody you know play the character you know of darmej and we'll have a spanish thing when it was like it's going to cost a thousand an episode two thousand an episode i was like yeah not economically viable to spend a million dollars a year on that or whatever just got a startup um that's doing it yeah they're like it's gonna cost about 50 bucks an episode uh to just do a little polishing or whatever and that'll be five bucks next year and it's just something like well i think they're building this into youtube so this conversation on youtube you'd be able to if you were in japan or you know wherever just change our change us to speaking in japanese and man is it powerful when you think about that you know 100 million people who are in japan and don't speak english being able to watch content in real time.
1:01:03Yeah. And then, you know, from the business owner's perspective, from your perspective, it's like now it takes the existing investment you had already made in creating content, and now amplifies the value of that content, right at marginal costs in the grand scheme of things like, Oh, I've already done all the hard work, I've had the guests on, I've done the thing, I've done the prep work, here it is. And now I can make it available to a global audience. And global, not just in the sense of language, right? Because the way these LLMs are headed you can say i want it culturally appropriate for this particular context right okay when the examples are there instead of just translating word for word what the language is actually saying let's come up with local sports team examples let's come up with this versus uh something else right like we can now kind of personalize for an audience of one which was just not possible economically before but it's well and you think like a lot of times on the podcast i'll explain what cpi is right or i'll explain what sass is but on this big start i don't explain what sass is um but if somebody didn't know and you're like you're at neophyte it would literally take a moment to have me and my voice say sas software as a service yeah that's software that's available for rent per month that you can cancel all right listen dharmesh amazing to have you back on uh i can't wait to see all the stuff you're building at hubspot i know you're a deep in the lab there's no announcements yet right not yet uh but i know you got announcements dropping yeah you're a publicly traded CEO now.
1:02:24So we got to be careful. But you got to promise me when they drop you come back on. We got a deal. All right, that's it. All right, my friend, have a great summer. Great to see you. What a great hour together. Congratulations on all your success. And I'm just thrilled to have you back on the pod. And I cannot wait. If you don't use HubSpot. Well, you're probably not running a business, certainly not a startup. And thanks for how gracious you are to startups. A lot of my startups are in the startup program. What's the deal you give them? Because you and i talked about some early days and i was like hey i don't think this is viable for startups you're pricing you're like oh i'll fix that and sure enough you did so it's i think it's like 90 off for the first year the first two years just like i'm not crazy anyway i appreciate you doing that because all of our founders take advantage of it uh just type in hubspot startup program you'll find it all right darmesh we'll see you next time bye bye everybody thank you
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Today’s show:
HubSpot CTO Dharmesh Shah joins Jason to discuss his angel investing origin and strategies (2:36), HubSpot’s journey from a startup to a public company (6:19), the potential of generative AI (42:03), and much more!
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Time stamps: (00:00) HubSpot Co-Founder and CTO Dharmesh Shah joins Jason (2:36) Dharmesh explains what prompted his angel investing journey (6:19) HubSpots journey from startup to where it stands today (8:48) Dharmesh’s decision to focus on Small Minus Big (SMB) investing (11:12) Vanta - Get $1000 off your SOC 2 at https://vanta.com/twist (12:19) SMB investing conversation continued (16:08) The difference in cycles between big and small businesses (17:45) The best reason to start a company (21:25) Ways to go about assessing ideas (23:29) Crowdbotics - Get a free scoping session for your next big app idea at crowdbotics.com/twist (28:34) Breaking down the entrepreneurial work ethic (34:15) Anticapitalist sentiment in the U.S. (38:11) Fitbod - Get 25% off at https://fitbod.me/twist (39:40) Starting a business in a downturn (42:03) AI’s impact on business and Business Process Automation (BPA) (46:39) Dharmesh’s thoughts on the next stage of AI and the effect on jobs (54:41) How AI will lead to more efficient organizations and increase margins
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