Andrew: Hey there, freedom fighters. My name is Andrew Warner. I’m the founder of Mixergy, where I do interviews with real entrepreneurs about how they built their real businesses for an audience of real entrepreneurs. In fact, today I’ve got one of my long-term listeners here and somebody whose career I’ve admired a lot and I never thought that I’d get to interview him. I’m so glad that I get to have him on here today.
His name is Elad Gil. And for those of you in the software entrepreneurship space, you probably have heard his name. Most people haven’t. I don’t think he’s one of these guys who’s gone mainstream, but he’s really, really highly respected in Silicon Valley here. He is a man who has founded several companies, including Mixer Labs, which he sold to Twitter, Color Genomics, which he then turned over to his co-founder to run. He’s also a man who’s angel-invested and advised many companies, including Airbnb, Coinbase, Gusto, Instacart, OpenDoor, Optimizely, Pager Duty.
You know what? I keep wanting to stop a lot, and then I say, “But the next one is even more impressive.” Stripe, Wish, Zenefits, Pinterest, Square. Anyway, really impressive. And Elad Gil has written a book called “The High Growth Handbook.” I don’t even know how to talk about this because, Elad, in the book you talk about . . . Here’s one phrase from the book. “Half a billion to a billion tends to be a transition point.” Who’s going to relate to that? That’s a small amount of people. That’s why you don’t go mainstream. Naval Ravikant on how to get your board member out before you go public. That’s what’s in “The High Growth Handbook.”
And I should say this interview is sponsored by two great companies. The first will help you hire phenomenal developers. It’s called Toptal, and Elad’s got a big section on his book about hiring and managing and firing. And the second will help you hire . . . actually, will help you get phenomenal designs. Even someone like me, someone who has no design sense got great designs from DesignCrowd.
Elad, I invited you here to talk about your career, how you built up these phenomenal companies, how you got involved with all these companies you have invested in. But I got to ask you, who is “The High Growth Handbook” written for? Is it for five people here in San Francisco?
Elad: Yeah. It’s actually meant to be a lot broader than that. So there’s a lot of sections that I think deal with things that every founder has to face in terms of you go from a single person or a few people to a 10-person team or whatever it may be, the way you think about your job has to shift as CEO. So there’s a few sections in the book that I think are very broadly applicable, and then to your point, I do think that there are things that are a bit more targeted in terms of how do you think about board management, how do you think about product management and a product management org, how do you think about PR and communications and marketing?
So I do think there are some universal things, and then, to your point, there’s some things that are very specific to high-growth Silicon Valley companies like, you know, how do you do a very late stage round where you raise half a billion dollars. And so it sort of spans the gamut. The focus is really on founders, executives, and employees of these companies that are growing very rapidly, but I think there are some lessons that can be applied much more broadly.
Andrew: I agree with that, like . . . Well, one of them is about taking some time off before you burn out. You talked about how on your first anniversary, where did you and your wife go?
Elad: We went up to Napa and we were going to have this very romantic weekend, and then I spent most of it on the phone negotiating a deal for my company Color. And so that was a great example of something that I absolutely shouldn’t have done. And if I could go back in time, I would have done that very differently.
Andrew: Did you get the deal?
Elad: We did not get the deal, so that makes it even worse.
Andrew: So, you know what? We’re in a world where I was just watching Gary Vaynerchuk spend his Sunday going through yard sales, buying stuff, selling stuff, making a point about how you can keep hustling, hustling all the time. And in your book, you keep talking about, “No, you’ve got to watch your time. Say no to more things. Avoid burnout.” I get the sense that you’ve come really close to it or you’ve had some really intimate experience with it maybe with some of the entrepreneurs. Talk about where you experienced that.
Elad: Sure. I think every founder has gone through a period where they’ve been working too hard or where they aren’t saying no to the right thing. So an example is one founder that I invested in who’s an extremely talented CEO. She kept taking calls at 5:00, 6:00 in the morning with potential customers on the East Coast. And I said, “Well, look, if these people are actually serious, you can schedule them later in the day. You don’t have to wake up at 5:00 in the morning to do these calls.”
And so I think a lot of people who start companies feel so much emotionally on the line and they want to do whatever it takes to make it succeed and I think sometimes you go too far to the point where you’re really disrupting your own life, you’re not sleeping enough, you’re not exercising, you’re not spending time with your loved ones. Like, you really can eat away at sort of the rest of your life and you have to find the right balance. I actually think, as a founder, you have to work hard if you want to do well, but I think you also need to balance it out with other things too sometimes.
Andrew: How big did Color Genomics get before you turned over the CEO title to your co-founder?
Elad: It was almost 100 people when I stepped down.
Andrew: You know what? I’ve noticed that you mentioned number of people instead of revenue a lot. Like, when you talk about . . . When you entered Twitter, it’s obviously not revenue. But can you talk about revenue? Yeah. What kind of revenue did Color get to before you turned over?
Elad: Color hasn’t announced revenue sort of in general broadly publicly, but I think the reason that I talked in terms of numbers of people versus revenue is if you have like a 12-person company that’s doing $100 million in revenue, it may not be a very complicated situation for the company almost definitionally.
In other words, there are consumer apps like that, that just scale up really broadly, maybe you have a subscription service, and maybe you don’t build out a large team around it. The complexity of that business may be high in terms of customers and other things you have to deal with, but if it was that complicated, you’d have to add customer support people and you’d have to add a lot of other types of people to the team.
So, often, I view number of people as a metric for stage. It’s not perfect, right? “The High Growth Handbook” for example, focuses more on number of people than revenue because, ultimately, number of people is where a lot of the complexity comes later.
If you’re 13-people in your Instagram and you haven’t built a business team, which is how many people Instagram was when Facebook bought it for half a billion to a billion, wherever that ended up. And I guess now there’s multiple on that. You know, 13 people it’s really hard work, but it’s not as complicated as running 100 or 1,000-person organization. And so my book is really meant for people who’ve scaled their team past 50 people in terms of some of the issues that you have to deal with there.
Andrew: Okay. All right. And so that’s why you also talk . . . You like that complexity. You like helping entrepreneurs figure out how to navigate that. So why don’t we start with where you got there? You talked about how at Twitter, when they acquired you, they were 90 people. I think you help them scale up to what? A thousand people?
Elad: About 1,500. Yeah.
Andrew: Fifteen hundred. And that’s because you started Mixer Labs, which did what?
Elad: Yeah. We were originally going to be called Mixergy Labs. So we had to change the . . .
Andrew: Oh, man.
Elad: Yeah, we had to change it.
Andrew: Why confuse people with like Mixergy, they’ll say Mix . . .
Elad: Yeah, exactly. It was so close. We almost had the name. You beat us to it. So, yeah. Mixer Labs was our early developer infrastructure products. So it basically allows developers to build geolocation or other features into the applications, and so it’s sort of like Twilio, allows people to build an SMS or telephony in the applications or Stripe helps people collect payments. We were helping with sort of another piece of the infrastructure pie that developers have to deal with on a regular basis.
Andrew: Geo API, is how they were calling it at the time, right?
Elad: Correct.
Andrew: And your vision was to help people with what type of apps? This was 2009, when the acquisition happens, so soon after the iPhone came out. Was it iOS apps? Was it mobile apps?
Elad: Yeah, it was mainly iOS and mobile apps. There’s also a set of companies that had large datasets that just have location associated with them. So there may be like a company that deals with matching nannies to kids or caretakers to kids or teachers to kids or whatever. We actually got contacted by multiple companies in these sorts of markets where they didn’t have a good way to actually show who were the closest people or service providers next to you. So it could enable apps like that. It could enable different types of social networks in terms of broadcasting location. It could help businesses in terms of routing and logistics. So, really, it was a general-purpose piece of infrastructure that could help you with any sort of geolocation related query. So anything where you need a map or map-related data.
Andrew: My sense is you got the idea for that because you worked at Google in their mobile product area, right?
Elad: Yeah. When I joined Google, there wasn’t much in terms of mobile efforts. I help get those up and running, and so I was involved with buying Android and I pulled together the early teams for Google Mobile maps and mobile Gmail. Both of them actually had acquisitions that we made that sort of turned into sort of the applications eventually. So, yeah, I was involved with a lot of really early mobile stuff, and so it felt very natural to start to ask, you know, what are key components that mobile applications will need, and then can we provide that as a service?
Andrew: So why didn’t you say, “I’m going to take it to Google. People are going to need this. I’ll build it within Google”? Why’d you decide to do it on your own? Was it your chance to be an entrepreneur?
Elad: Yeah, I’ve always wanted to be a founder, and I always wanted to start something from scratch and sort of be the master of my own destiny and that sort of thing. So that was a reason that I left Google to start it.
Andrew: Okay. And so when you started it, did you get any users before you sold?
Elad: Yeah. We actually . . . We didn’t need to sell, so we approached Twitter originally as a customer and we started having customer-centric conversations because they really wanted to build out . . . If you remember the time, Twitter had a very large, thriving and diverse developer ecosystem, and I think they had something like half a million or a million developers working against our APIs. It was some enormous number, and they hadn’t really integrated geolocation in and Foursquare was coming up with check-ins and Facebook was adding it as a feature.
So there was this competitive dynamic in the main consumer social networks around geolocation, and so we approached them more as a customer because they hadn’t built it out yet. And then they turn the conversations into, “Hey, actually, do you want to come in-house and we’ll give you access to hundreds of thousands of developers and you can be part of this big platform at a fundamental piece of tweets, and let’s do something together.” And so it really morphed from a sales or partnership conversation into an acquisition conversation.
Andrew: Look at this. I’m researching everything you’re saying as we’re talking, and I see an article from about 10 years ago about how you guys started out making a local wiki product called Town Me.
Elad: Yeah. Originally, what we started doing was aggregating different types of geolocation data, and at the same time, we started generating it ourselves as well. So we had, at some point, a content team of about 30 people who were producing content, and at the same time, we’d built out this very deep geo-infrastructure stack, and we realized that really what people wanted most was the ability to access the set of infrastructure that we built versus the content that we created and the content was then layered into the APIs we made.
And so we ended up with a pretty complicated product with four different components that I won’t bore you with, allowed developers to do very complicated stuff either with geolocation data that we had acquired and provided to them local listings or this content firm that I mentioned, or the ability to upload their own data and query it and really rich ways so that they could pull out insights or provide insights to their customers through that data.
Andrew: So, then, at what point did you switch from doing that to helping the company grow, helping Twitter grow?
Elad: Sure, yeah. So we got acquired back in 2009, and at the time Twitter was about 90-ish people. And my team was almost 10 people. So we were almost 10% of Twitter when we got bought, and about . . . I don’t know how many months in. I’m guessing it’s six months in, something like that, there was a big reorg on the product team, and I came in as a director of product or something like that.
And Dick who was the CEO at the time, asked multiple people on the team, “What job do you want? Which part of the product world do you want to run or what do you want to work on?” And each person would say, “Hey, I want to do this. I want to do that.” And I think I may have been the only person who just said, “I don’t care. Just tell me what’s needed for the company and how it can help and that’s what’s important right now.”
And so I ended up leading and to Dick proposing that I become the Vice President of corporate strategy or strategery as we called it. And really what that meant was helping to scale up the company, because anytime you’re going from . . . In Twitter’s case, it went from 90 or 100 people to 1,500 over two and a half years. Anytime you grow that fast, there’s lots of things that you do need to get built up or fixed. There’s always broken things at any company, but if you’re growing really fast, you’re breaking things internally, organizationally, people-wise faster than ever. And so my job quickly became sort of that of a fixer, and so, me and this guy, Ali Regani [SP] . . .
Andrew: Can you be specific about something that broke that Twitter that you had to go fix?
Elad: Sure. I’ll give you an example. Recruiting wasn’t scaling as fast as the company needed for hiring purposes, and so it was almost like a management consulting exercise, where one of the folks on my team partnered with a recruiting org and basically worked out, “Okay. What are the different roles that need to get specialized and who needs to be hired? And what are the tools that need to be in?”
So it’s almost like a comprehensive review of like, “Okay. How are we going to scale from hiring . . . ” I mean, they’d hired 90 people over the course of, I don’t know the exact time frame, say, four years of the lifetime of the company, maybe longer, and then they suddenly had to add 1,000 people in two years. So you have to change how you approach that sort of problem.
Andrew: So, when you go about doing that, you don’t have experience doing it before. What’s your process for doing that a lot? Are you going out and saying, “Who’s the best at this? I’m going to go and get advice from them”? Are you trying to hire recruiters? I want to understand your approach to taking on new products through this experience.
Elad: It’s three things. One, to your point, you just go and you talk to the very best people who’ve done it before. And in the case of something like recruiting, you want to talk to people or heads of people or heads of recruiting, but you may also want to talk to some of the CEOs who went through it who may have a slightly different perspective in terms of what worked for them. So one is, to your point, talk to people who are really good at it or who’ve just gone through the experience.
Number two is, on the recruiting team, there were some people who’d been through it themselves, and it was more about making it so that their voices were heard more strongly, or in some cases, depending on the area they’re working and recruiting, this didn’t happen, but another area is sometimes you have to move people around in terms of, “Okay. This person should really be the leader of this group, or we need to hire in somebody who’s more experienced and seasoned to run it because there just isn’t the expertise in-house and this is a solved problem.”
And then lastly, often you find that when things are growing really fast, if somebody’s been through it before, they’re really calm, they’re thinking 18 months ahead, they’re planning. If somebody hasn’t been through it before, things get a lot messier, and so sometimes you just have to say, “Everybody, let’s calm down and just take a look and what’s logical.” And often logic just wins out. It’s like, “Okay. Let’s tighten up our process. Let’s make sure people are getting through the pipeline quickly.” There’s some pretty basic things that you can often do.
Andrew: It feels like you’re really big on logic, like, even when you talked about management at that period, I’m looking at my notes for it, you basically said, “Look, I needed Dick Costolo to come in and pound the table about objectives and key results.” Like, you were good at being that logical, organized, thoughtful person, but is that the way it is where you’re logical but you need somebody else to be the charismatic, head-bashing in type of person?
Elad: No. I think what you need is the support of the CEO to roll out stuff that people are resistant to. So, if you’ve never set structured goals as an organization or if you don’t have that coordinated across the company, the CEO has to be the person who says that’s important. You know, that’s true of different aspects of culture. Like, you can try and disseminate culture, you can try and convince people to do things. If the CEO and the founders of the company are living something, everybody else will copy it. And so it was less about Dick needing to be like some strong person pounding the table and hit on the table. It was more about the fact that he was the CEO and therefore people look to him to be the person who’ll tell them, “Yes, we actually really are adopting this thing.”
Andrew: And the reason that people don’t like it is what? It feels too corporate to have key objectives and results?
Elad: Yeah, it depends on the company. Sometimes if you start something like objectives and key results, which is one framework for goal setting, if you start that early on in the life of the company, there’s never controversy because as every person joins, they just realize it’s the thing that everybody at the company does and they just kind of do it.
If you’re 500 people who have never had that sort of organized process and you implement it, then some people may ask, “Is this really worth our time?” They may view it as too corporate, to your point, especially if they came out of a very large organization that was using it because if you’re a 50,000-person organization using something, who cares? Maybe three weeks out of every quarter is spent reviewing, grading and generating them. It does feel like a waste of time because you’re spending so much time on it. So it may not be the best use of time if you’re very, very large and you’re doing it into process or into deploy.
So I think it really depends on the context. If you’re coming from a raw startup and you’ve never seen it, it’s weird. If you’re coming from a very large company that kind of abused it, you’re also going to be resistant, and so you just have to find the right way to implement it.
Andrew: And one of those ways is to make sure that the CEO says, “This is important. We’re going to do this.”
Elad: This is important. We’re going to do it. Here’s why . . . Here’s other companies that have found it useful. Here’s their approaches. And in our case, I think there’s also one or two teams that it’s sort of piloted it so then the people from those teams can tell their peers, “Hey, actually, we implemented it and it worked for us.”
The other thing we did is we actually pulled together a few different people from different orgs so that as we decided what the goal-setting process we’re going to use was, we had different people locally who were sort of bought in and then they were responsible for bringing it back to their team. So the decision wasn’t made by me sitting in a room by myself and then I went out and said, “Hey, this is what we’re doing.” It was more, “Hey, I assembled the team of people from across the company. We discuss different frameworks and approaches, what’s worked for people in the past.” And then we agreed on a common way to do it , and then we sort of rolled it out collectively. So it’s a nice way to sort of engage everybody.
Andrew: You know what? I saw you . . . I read in “The High Growth Handbook” how you talked about that. I forget. I think it was with Claire Hughes where you talked about how do you get both consensus and leadership, and I think she said, “Tell people up front. I want your input and at the end, I’ll be the person who makes a decision, so that you’re not abdicating your leadership role but you’re also opening it up to other people in a clear way.”
Elad: Yeah. I think it’s really important to articulate clearly what the decision is and who’s making it as you hit a certain scale of organization. And Claire Hughes Johnson actually has these great . . . She’s the CEO over at Stripe, and she has these really great videos. Actually, you can do searches on YouTube and things like that where she talks about walking into meetings and she’s very explicit about who’s the decision maker in the meeting. Does she want to consensus-driven decision or does she want to make it, etc.? And so I think sometimes it really gets rid of a lot of fad or a lot of unnecessary iterating through things over and over again if you have clarity in terms of what your role is.
Intel used to do this where they used to train people to literally think, “Am I in this meeting to provide input? Am I the decision maker? Am I an expert in terms of information?” Like, what’s my role? And therefore, actually, it helps to make certain things not emotional because if you actually realize somebody else is a decision maker, maybe you’re not going to fight over something trivial that you shouldn’t be fighting about.
Andrew: All right. Let me take a moment to talk about my first sponsor, and then come back in here. So your website, eladgil.com, this basically would work on the original web browser, the Mosaic browser. The only thing that’s missing here that would make it feel like a 1990s website is blinking lights.
Elad: Yeah, actually I put a blink tag in.
Andrew: Did you put it in there?
Elad: Yeah, yeah. But I don’t think it’s supported anymore by most browsers.
Andrew: So imagine if Elad said to himself, “You know what? I really need a nice website here. I’m about to become a public personality. I’ve got this book. People are starting to interview me. I actually even made it on Mixergy. But I don’t want to make it look a little too . . . like I’m trying too hard.”
Right? What you would do is, you would go to designcrowd.com/mixergy. They have a small form for you to fill out, one or two questions. They almost make it so simple that they understand that you hate even talking about design. They’re just going to slowly ask you a couple of non-threatening questions. You fill out those questions and then you go away and you forget about it and you say, “You know what? I really love my current website.”
A couple of days later, what’s going to happen is, you’re going to start to get a bunch of emails because DesignCrowd is not embarrassed to send you an email every time somebody designs a new version of your site. And at first, you’re going to say, “What is this?” And then you’re going to click into it and you’re going to say, “Whoa, I just gave people a couple of suggestions and look at these beautiful designs that they gave me. One of them is kind of ugly. And that one is okay and this one is beautiful.”
And so what you’re going to do is you’re going to start to feel viscerally some opinions about these websites and all you have to do is go in and select like, how many stars you give it and a little bit more detail if you want to give them detail. All these people will take your opinions to heart because they’re all competing for your business. Every one of these designs created beautifully just for you, and they’ll go back and create revisions, you’ll give them more feedback, then they’ll give you more revisions, then you finally after a bunch of this, decide which one you want. You pick and you only pay for the design that you like. Simple, right? Except you probably like your current retro design, don’t you?
Elad: If they could do a blink tag, I’m in.
Andrew: I bet they would. So question number one, make sure to say, “I need a blink tag. I need it to look like it would fit in the past but also put a big headshot of me on there.” Anyway, whatever it is that you guys are out there looking for, website, nobody needs a brochure in my audience, nobody needs a business card in my audience. Don’t use them for business cards. Business cards are dead. Or landing pages, maybe you need a new logo, whatever it is, go to their site, fill in the form. They make it super simple. Even somebody who hates design like me will end up with a beautiful design like the cover art on my podcast.
And if you go to designcrowd.com/mixergy, number one, you’ll be doing me a solid because they’re going to give me credit for sending you over. And number two, they’re going to give you a big discount on their already low prices. And I really hate that their prices are so low because it means that I’ve got to convince a bunch of you guys to sign up for them to make back the money that they’re spending because my ads are pretty expensive.
So I will say this. The prices are low, take advantage of it. They’re not going to be advertisers in 2019. I know it. They already said no because . . . How many people at . . . It’s like $100 for design. How many people do I have to send over? A thousand people for them to make this ad work? Raise your prices DesignCrowd. All right. Designcrowd.com/mixergy. What’s the biggest mistake or one big mistake that you made when you were at Twitter that informs the kind of advice that you give today to the entrepreneurs you invest in?
Elad: Yeah. I think in general, there’s tons of mistakes made at every company that’s growing really fast. I actually remember when I was an intern at Cisco back in like 2000 during the height of the internet bubble, and there was a guy that I talked to who joined in 1990 in the new sort of like a VP of supply chain and then he moved over into the product groups there, and I asked him what his biggest takeaway was from his 10 years at Cisco and he said, “Growth covers up for a lot of mistakes.”
So I think basically any . . . It’s interesting because if you look at a lot of these companies that have done really well, Google, Facebook, etc., Amazon, in the early days, almost every company is an extremely chaotic, super messy environment, and then later as the company sort of grows up and it hires experienced people and promotes great people from within and starts running things better and better, it gets this veneer of an excellent company and people think it was always just amazingly run. And mostly these things are just . . .
Andrew: Nobody thinks that about Twitter.
Elad: Yeah. Twitter may be the exception, but in general, most companies have a really messy period and it just often doesn’t get reported as much as it got reported at Twitter. I mean, Facebook turned over its executive team twice early, but nobody ever talked about it. So I think part of it, too, is just the press attention to some of the turnover and other things that Twitter saw.
Andrew: And so what’s the piece that you then give . . . You’re saying, “Look, if you have a lot of growth, you probably have a lot of mistakes underneath. Let’s make sure that we go fix it before the growth slows down.” Or?
Elad: I think it’s a few things. The first, the big transition a lot of people have to make in their mind as CEOs or founders is, they’re really focused on their core product. They’re like, “Here’s our roadmap and here’s what we’re going to build in 18 months and here’s how we’re going to diversify it out and build new things and all the rest of it.” But they don’t do that with their org. And they should be doing the same thing with their company.
They eventually have to start thinking about their company and their team as a product and they have to have a roadmap for that. And so if you have a website that’s really popular, often the backend server will go down on that website, and then you’ll have a meeting where you say, “Well, if we 10X the traffic next time, how do we deal with it?” and they come up with a roadmap to fix it.
People should do that with their companies. They should say, “Hey, if our company is going from 10 people to 100 people, let’s sit down and roadmap out. Who do we need? What functions do we need? Who would need to hire? And what are the things we don’t know? Let’s go figure it out.” And if you just kind of thought proactively, then you’ll get there.
And so what you’ll find is a lot of really experienced executives if you hire them onto a high growth company, if they’ve already been through it before, they have a roadmap in their mind and they can literally tell you, “Oh, yeah, in six months we’ll have to hire three managers on my team and then in a year we’ll have to promote these people to directors and do two other things, and the team will be the size and this is how it’s going to work.” And they’re usually pretty accurate. And so you can tell the people are going to scale in your org often by how effectively they can just predict that ahead.
Andrew: It feels like a lot of this stuff doesn’t come into play until you’ve got product-market fit. Am I right?
Elad: Yeah, that’s totally right. The big chunks of the book, again, are accessible and I think to broader populations, but big chunks are also you have product-market fit, you’re ramping things up. What do you do now?
Andrew: That’s what I’m getting out of it. And just to give people a sense of how the book is structured. Elad basically gives both guidance and you lead interviews with entrepreneurs like Marc Andreessen, Naval Ravikant, Sam Altman, Miriam Naficy.
Elad: Naficy.
Andrew: Naficy. I never know how to pronounce her name, but I’ve known her for years. She’s so fantastic that she’s just not known well enough because Minted is not geared towards like Silicon Valley users, you know. Anyway, I love her. So that’s the structure of the book. I wonder why you left Twitter.
Elad: Yeah. I left Twitter to start a company again. So I felt that with Mixer Labs, we’d sold early, our original intention was to keep going and then we had this sort of inbound from Twitter. And so for the second company, I wanted to sort of build something from the ground up myself. I do think that at the time I was perhaps really myopic on being an entrepreneur, where from a structural perspective, I probably should have taken a step back and ask myself, “Okay. Given that I’ve now been a vice president at Twitter, I’ve helped scale all these things. What should my next gig be?” And instead, I was just going to knee-jerk, “I’m going to go and start a company again.” And startups are always very hard to do, and so I probably took 10 years off of my life doing another company just like every founder. So . . .
Andrew: Did it feel like it was going to be easy because you figured so much out that you had experience with all these angel investments that you made, you had experience working in Twitter, you had a company that succeeded? It gave you a false sense of simplicity?
Elad: Well, certain things were much easier the second time, and many founders that I know feel the same way. So you know how to hire a team and you know how to raise money and you know how to find your first customers, and you know a lot of the basics. And so I think those things were straightforward. We were in a market that’s very complicated, regulated, supply chain, physical goods, etc. So what Color does is it provides very low-cost genetic tests that help people understand their risk of different hereditary diseases. And so that means you have to ship saliva kits around the country, and run things in a CLIA certified labs and all these regulatory licenses and other things. So it’s a more complicated thing.
But that’s all fine. I mean, you figure that stuff out or you hire experts. And what we did is we hired people who’d done it before and who’d run big clinical labs in the past and things like that. I think the hard part is just, you know, if you really care about what you’re doing and you really care about your team, you’re just going to have a higher level of stress because you’re constantly trying to make sure that everything’s running well as a founder. And so I think it’s just . . . Being a founder and being a CEO I think is much more stressful than just joining a company.
Andrew: Even to this day.
Elad: Oh, absolutely. And every founder that I know says the same things.
Andrew: I wonder why. Don’t you remember when you were starting out or did you feel this way that, “If I finally make it once, there is no risk, and that’s it. I can actually be comfortable”?
Elad: It depends on somebody’s personality type. I don’t have that complacency built into me. So it’s probably a big flaw, but it’s also probably what makes me want to go start companies is you really feel like you personally are on the line and you want to make sure that the thing is going to work and you want to make sure that your team is happy and you want to make sure it’s a great place for people to be and you want to make sure that . . . You know, in our case, because Color is a product which really helps impact people’s health decisions, you need to be very, very careful in terms of the information you provide, how you provide it, that’s extremely high quality. So there’s also that extra burden of making sure that your customers are 100% covered at least as best as you can possibly do it.
Andrew: I want to come back to Color in a moment and find out how you came up with the idea and how you did get those early customers. But I mentioned that you are an angel investor. How did you start angel investing and how did you become one of the best ones in the business?
Elad: Yeah. The angel investing, I started really organically. So I had a bunch of friends who were starting companies around the same time I was, and we would all give each other advice and one of the things I started giving a lot of advice on was things like fundraising or hiring your first few employees or managing early teams. And so [inaudible 00:29:01] using money, they just started organically pinging me and just asking, “Hey, do you want to invest as part of this round? So it kind of happened a little bit through happenstance.
Andrew: It was just you investing through friends or were you making any kind of . . . That’s it. It was just, “Am I friends with them? If I am, let’s do it.”
Elad: More like, “Am I friends with them and is it a good idea?”
Andrew: Okay.
Elad: But there are also some circumstances where it was you see some people repeatedly at the same event. So like the founders of Airbnb I kept running into and then I helped them a little bit with their Series A fundraise, or with Stripe, I think I just emailed Patrick, the CEO there when it launched a little bit randomly. I just thought it was a really cool product that nobody used it at Mixer Labs, and Mixer Labs had built infrastructures, so I think I just emailed and said, “Hey, I worked on some infrastructure and I think what you’re doing is really cool. Do you want to just go for a walk and talk about startups?” So a lot of the things happened very organically early on.
Andrew: And you’re just talking him and you’re giving him advice at that point?
Elad: We basically just talked about what are different types of platforms and infrastructure and things like that, and then I may be misremembering this, but I think they were raising a round from Sequoia and he literally just messaged me and said, “Hey, we’re raising around you. Do you want to invest?” And again, it happened pretty organically in that case.
Andrew: You know what? I talked to one of the people who worked for him who said that he intentionally will delegate almost everything away so that he can be more accessible to have conversations with people to be the guy who responds to people on Twitter. I feel like he’s a good manager but I don’t get to see enough of what makes him such a good manager, like, the type of CEO that you aspire to train with the book, “The High Growth Handbook.” It feels like he represents that. Am I right?
Elad: I think there’s lots of different styles of CEO, and so I don’t think there’s one like canonical good version or one that is the way that you have to do it. I think what you find is that each person finds the things that they really liked doing and the things that they hate doing. And one of the reasons a lot of founders or CEOs burnout is they spend all their time on stuff that they hate. So, if you really dislike setting sales compensation and sitting in endless meetings, maybe you should hire a CEO or VP sales to run that for you and find the right way to check in on those things but not drive it.
Andrew: This is one of the things you hated.
Elad: It’s one of the things that I didn’t love. I mean, I’ve done it before, so it was less about disliking it or hating. I thought it was fine. It’s just I done it enough times before across multiple different jobs that it wasn’t new or as interesting as doing something completely different. So each person needs to figure out what are those things that they love, what are the things that they hate, and then find ways to spend time on the things that they love. So, for example, Zuckerberg in Facebook famously had Sheryl just take over a bunch of operations and business stuff so he could focus more on product and engineering. I think different founders enjoy different things and they should sort of steer their companies or organizations to allow them to do that stuff.
Andrew: Except I think you said . . . Oh, not except, but I think in the interview you did with Sam Altman in the book, he said, “But it’s not a good idea for founders to stop paying attention to product and to stop attending meetings with the executives.”
Elad: Yeah, I definitely don’t think you want to be absentee. So, if you’re on a plane somewhere while everybody else is working, that’s obviously a terrible situation. You’re in Hawaii and . . .
Andrew: Or I think with the example you gave was not being in Hawaii, but sitting and thinking about the vision and focusing on the vision and forgetting about the product, forgetting about attending those meetings that can be a little frustrating.
Elad: I think . . .
Andrew: Am I right?
Elad: I think you need to find the right balance in terms of where are the places you’re going to be hands-on and where you’re needed, and then also, what you’ll find is, you know, what’s the weekly meeting that you’re going to meet with everybody to talk through very specific topics? Like, you have to be in product reviews, you have to be in things that require a decision from the CEO.
Now, were those things . . . What’s important enough to bubble up to you will change over time, right? So, when you’re five people, every decision is important for you in some sense, right, up to a point. Yeah, maybe if you’re not a technical CEO, you shouldn’t be weighing in on how the engineers are building something, right? But you should be saying, “Here’s the roadmap and here’s the product,” or, “Here’s what our customers want,” or whatever it may be.
When you’re 500 people, you play a very different function, like you have lots of people that you hired who are talking to customers every day and they should be synthesizing that information and bringing it back for everyone. You should still be having customer conversations, but you don’t need to be in every single customer conversation, right? So I just think like some people will have something start to work, they’ll have product-market fit, it’ll start scaling, and then they just won’t let go of the right things.
And so often what I’ll recommend, and I actually do this for myself, even though now I’m not even running a company, I tried to go through my calendar and audit it and say, “Hey. What are the things that I actually did this week or this month that I shouldn’t have done?” or, “What are things coming that I should get rid of or have other people do?” or, “How do I get things off of my plate?” because what’s important when you’re five people in terms of the founder or the CEO being involved really often isn’t the same stuff that 100 people but there’s a whole other set of really important stuff. And then there’s some overlap, right? Some decisions around product or some decisions around key customers, things like that may still be very important throughout.
Andrew: You know what? I like that in your book. The calendar audit. And then I wonder, it takes a lot of discipline. I think . . . Who’s the name? From “Getting Things Done” said that one of the big reasons why people don’t actually implement his idea is they don’t spend their time to process all the things that they would put on their task list and to organize it. You have the discipline to do that.
Elad: Yeah. But I also think things like auditing your calendar, if you do it once or twice successfully, you’re so happy you did it. With a task list, you’re constantly giving yourself chores to do, and so every week you’re like, “Oh, I have another chore. This sucks.” When you’re auditing your calendar, you’re like, “Oh, I’m so happy. I don’t have to go to that thing.”
Andrew: Oh, because what you’re doing is, you’re looking ahead and you’re saying, “Hey, you know what? I actually just scheduled a call that I don’t need to take. Someone else is better off taking that and I could just make the introduction step back, delete the thing.”
Elad: Exactly. Then you feel relieved. You’re like, “Ah, I don’t have to do this thing.” So it actually has the opposite reaction I feel.
Andrew: Okay. The idea for Color came from where?
Elad: It was a mix of things. I have a PhD in biology where I worked as sort of the intersection of longevity, cancer, and insulin. But I think really the driving force for it . . . And we had another MD on the team who is a co-founder who had worked on cancer, but I think that driver for it was really my co-founder, Othman Laraki, who’s currently the CEO, and he’s very open with the fact that he himself is a BRCA2 carrier, which means he’s at higher risk for a variety of hereditary cancers, and due to that gene mutation, which he inherited from his mother, his mother has had breast cancer twice, and he’s had multiple family members pass from the disease.
So I think there was a very visceral realization that this type of information cost too much, it takes too long, it’s not accessible to most people. And so the question was, “How can we provide this information that could potentially be life-saving to people who could really benefit from it. So, it was really driven by his personal story.
Andrew: Okay. And then also an understanding of the market. I’d love to see how you analyze opportunities. So, yes, it makes sense for him. Yes, it’s the kind of thing that should exist. How did you know, “This is the thing I’m going to invest my time in. It’s going to be my next business”?
Elad: Yeah. I think it was really driven by us talking to a lot of people in the patient advocacy communities and some of the MDs and just hearing those stories of how either they were denied coverage for these sorts of tests because it wasn’t covered by the insurance and at the time it cost $2,000 to $5,000 to get one of these tests done. And so it was just out of reach for a lot of people who would really benefit or sometimes there were age cut off.
So I can’t remember the exact criteria, so I’m going to get it wrong. But some insurance companies, for example, had criteria that if you had cancer, I think it was like below the age of 45, then you get covered for the test, but over 45, you won’t get covered. So, if somebody’s got it when they’re 45 or it was diagnosed six months later, they don’t get tested to see if they’re at very high risk and there’s other things they should be doing. So there was a real issue in the market in terms of serving populations of people who really needed this information.
Andrew: I think it was Marc Andreessen in the book who said, “If you could be either two years ahead in product or two years ahead in marketing, pick two years ahead in marketing.” You’re nodding. You agree.
Elad: Yeah. No, I agree. I think in general, people tend to under-weigh, in Silicon Valley at least, the importance and power of distribution. And if you actually look at the biggest companies that have really succeeded, people always tell their stories without mentioning how much they focus on distribution.
So, if you actually look at Google, for example, it was spending hundreds of millions of dollars a year to distribute toolbar, which was this application that would install on your browser so you can do searches through your browser directly. Now, of course, since they launched Chrome, it’s all baked in. But at the time, there is no easy way to do searches without typing in google.com or typing in Yahoo or one of the competitors. And so they paid bounties so that apps would literally co-install them on people’s computers, and so they’re extremely aggressive about distribution from day one and that’s the reason they’ve actually been so successful or one of the reasons.
And I think people really missed that in terms of Silicon Valley stories. And so you see a lot of companies that end up being worth a billion dollars instead of 10 billion because it just never really focused on building out sales properly or being very aggressive about the distribution side.
Andrew: Oh, you picked the great interviewee to start with. What he said was, he just . . . You could see why he’s so good at Twitter. He just gives high impact, fast, interesting, challenging, just really good. The others you take a little bit of time to get into. They’re meaningful and deeper, but he was just like right on.
Elad: He’s amazing. Andreessen is amazing. But I mean, the other thing is he talks really fast so that entire interview was conducted in 20 minutes. And so it’s just like this 20 minute like amazing bit of information.
Andrew: I’ve also noticed Sam Altman does the same thing. Was he a super-fast talker with you?
Elad: He’s pretty fast. It was a longer conversation. Most of the conversations were longer, but Mark was just so compact that honestly if we talked for an hour, I’ll just spend the whole book.
Andrew: You mentioned growth in. I give SimilarWeb all the time. I’m trying to figure out “What’s Color’s distribution? What’s Color’s growth?” And all I could see from something like SimilarWeb is, “Number two source of referring traffic is hulu.com,” so maybe you guys are buying ads on Hulu. But what was it for you? What did you think it was going to be when you started Color and what did it end up being, like, the number one growth?
Elad: Yeah. There’s a lot of different channels for Color, and so we have everything from large health networks that we work with through to . . . For example, we have an employer program where Visa and Levi’s and a bunch of other companies use Color as a benefit for their employees, so they basically cover the cost of the tests or most of the cost of the test for the employees to be able to participate. There’s always a physician who’s involved with ordering the test, but it basically allows us to reach large populations all at once where an entire company can participate.
Andrew: Okay. By the way, you’re one of the most successful people in the Valley. Are you just sitting on a floor? Is this . . . I’m trying to get a sense of you from this. Where are you?
Elad: Yeah. I had to take on some childcare duties today. I have a young son, and so I had to stay home today. So that’s the reason I’m . . .
Andrew: And you sound quiet even with a young child.
Elad: Yeah. He’s actually crying upstairs. You just can’t hear it. That’s why I’m home. So . . .
Andrew: All right. I’ll do a quick ad for Toptal. You told me you didn’t know who Toptal was or did you?
Elad: I just made a . . . Yeah, I haven’t worked with them.
Andrew: Okay. You’re just kind of teasing me about like . . .
Elad: No, I just [crosstalk 00:40:23].
Andrew: Because I always check in with my guest, is this okay? Here, I’ll tell everyone what Toptal is. Toptal is a place where you can go and hire phenomenal developers. They pre-screen them. They have them in their network. When you call them up and frankly what you’re going to do is press a button and then schedule a call. When you get on a call with them, you tell them what you’re looking for. They introduce you to a couple of people. If you love them, you hire them and often you could start within a couple of days. If you don’t, you move on. Nothing lost.
If you go to toptal.com/mixergy, they’re longtime fans of mine, they’re going to give you 80 hours of Toptal developer credit when you pay for your first 80 hours, and then they also have a risk-free trial period. Go to toptal.com/mixergy.
Elad, you’ve got a lot of advice on hiring in the book. What are some of the big ideas that you would want to leave people with who are listening to us who say, “Andrew just did this ad on hiring. I want to learn a little bit more about how to hire”?
Elad: Yeah. I think it depends on whether you’re looking to hire individuals or whether you’re looking individual contributors or whether you’re looking to hire executives, and then also the scale at which you’re hiring. If you’re hiring two people, I think it’s very different than if you’re trying to hire 100 people all at once. So I don’t know which of those you’d like me to . . .
Andrew: You know what? I’m going to give you my big takeaway from there.
Elad: Yeah, sure.
Andrew: It’s something small, but I just had to write it down. Move fast, which a lot of people will say, but you said, look, “Optimize for a short time between steps in the process,” and that is advice that I need to take away from it because I don’t want to say no to people, so that slows things down. I want to consider them. That slows things down. You’re kind of marrying the person even though you can obviously fire them within a week if you want to, but that slows things down. It’s a big decision. So I wrote that down for myself. What’s one thing that you wish you’d have worked on earlier in your career? Maybe that’s a good way to put it.
Elad: Yeah. I think one thing that a lot of people don’t think about as aggressively like you kind of hear it but you don’t really think about it is, I think the way you should think about your company is almost like a life raft. There’s like five spots and you want the very best people who can help sort of save each other’s lives on those in those spots because ultimately in general, especially a startup just doesn’t have very many people you can hire.
And so too many people would sort of tolerate okay people or they won’t act fast enough if somebody’s not working out. And if you really change the mindset into, “Hey, we’re literally on a life raft. Who do you want on there?” I think it really shifts how you think about either hiring really, really well or unfortunately, letting people go if it’s just not working out.
Andrew: I don’t know if I’m on the life raft, I don’t want to toss anybody out. That’s the hard thing to do.
Elad: You know, it’s funny. Relatedly, a friend of mine was running a startup same time I ran my first one and she let somebody go off of his team, and then that person end up getting hired by Google and they had a great career and they . . . He still keeps in touch with that person.
And I think a lot of times the other thing that people miss is that they’re very good people who are just in the context of your startup or the thing that you’re building just aren’t going to be a good fit and aren’t going to work out, and that’s okay. And if you help them on their next step or you help them find a great next job, you may still end up having a really good relationship with them years later even though you had to let them go because they may thrive wherever they end up next.
And so I do think people often . . . Like, sometimes letting people go is awful on both sides, but sometimes it can actually work out for the benefit of both parties as well. So that to me would be one piece of advice that people often don’t talk about.
Andrew: I liked how you had a section in “The High Growth Handbook” about easing out those old-timers. The people who started out with you who were great at the time but for one reason or not, they’re not working out and you say, “One of the reasons is maybe they feel left out all the time.” Here’s another one. They don’t scale into the role that they want, right? So they want this highfalutin role because they were here at the beginning, and now suddenly people are being brought underneath them, but if they don’t scale into it, they’re not a good fit. Inappropriate exertion of power. You’ve seen this a lot?
Elad: Yeah, absolutely. If you’re, for example, the first designer at a company when it’s five people, you’re going to be designing everything, you’re going to be weighing in on every decision, you’re going to have enormous influence, you’re going to be having lunch with the CEO every day just like everybody else on the team. And if suddenly you’re 500 people or 100 people, suddenly you’re going to need hire two other designers and you have a third as much work to do. The CEO is now really busy. You’re not going to see them every day. You’re not going to be invited to every conversation because that’s not necessarily the input that’s needed from you at that point.
And so you start to feel like your world is shrinking. And there’s two ways to deal with that. One way is to really freak out about it and to fight it and to be negative. And the other is to just say, “You know what? I’m well-known by everybody on the team. I understand the product really well. I have cultural context. And so as the company continues to expand, I’m going to get bigger and bigger roles because I’m going to be one of those people that’s really trusted.”
And often there’s almost this decision point where people can either decide to really help out and do what’s good for the company or they can sort of react badly and kind of throw a prolonged mini fit and then eventually have to leave or quit. In my case, I kind of went through this with Google.
I joined Google at 1,500 or so and within three years it was 15,000 people. And I worried about it. My peers were getting promoted when I wasn’t, or different things were changing constantly, or I kept moving around in terms of what I was working on because that’s . . . When you go from 1,500 to 15,000, every year you’re literally a different company in terms of size, in terms of organization and everything.
And that’s one of the reasons that when we talk about the Twitter story, the situation with Dick, the second time I went through it, I was used to it. I was like, “Oh yeah, it’s going to be fine. I shouldn’t freak out about this. They’re doing a reorg. Things are chaotic. They’re going to be chaotic. Things will grow rapidly. I should just focus on what’s good for the company and things will work out.” And that’s basically what happened.
And so I do think that if you’re really early somewhere, you feel a lot more entitled than maybe you should, and I had that feeling myself, and you quickly learn that really you should just be focusing on doing what’s good for the company and most times things will just work out perfectly well for you probably better than if you act otherwise.
Andrew: I imagine it also feels like your friend has moved on past you, and that’s a hard thing.
Elad: Your friend has moved on past you or look at all the stature they’re getting or sometimes it’s tied to financial rewards. Like, there’s all sorts of things that sort of get tied up into it. But I think ultimately, what I’ve seen over and over and over again is if you’re somewhere early and you focus on doing the right things and you sort of realize you can learn from other people who are coming on board, your career trajectory actually accelerates. And if you’re one of those people who gets upset about it or drags your feet, then your career trajectory decelerates.
It’s interesting. One of the people I interviewed in the book is Ruchi Sanghvi, who was a really early engineer at Facebook. I think she was in the first 15. And then she later sold the company to Dropbox and then she was a vice president there. And she said that at Facebook, she was one of the people who would fight the new people coming in and the executives coming in and she’d dragged her feet and did all the things we just talked about. And then at Dropbox, she was the person coming in as the new person implementing all these processes and asking to change things. And so she was on both sides of it over the course of her career. And so I think a lot of people end up going through that.
Andrew: I wonder why you like this part of the business because I do see you get more excited about that than how you come up with the idea. This is the part that most entrepreneurs want to check out at. This is where it becomes a business, the kind of thing that you didn’t get into entrepreneurship for. I wonder what you see in it that maybe some of us are missing in this high growth period where you have to, as you said . . . So you said the word “processes” and I saw your face light up at that. And I get it. I wonder why. Why that’s drawing you in.
Elad: I think I like both sides of coming up with the idea and then scaling. The thing I don’t like . . . And it’s just a personal preference. Some people love the really raw 5% team where you’re doing everything and everybody’s on top of each other and every day is a battle. I don’t like that part. I really liked the idea generation, and that’s why I always worked in products, right? I worked on products at Google. I worked on products initially at Twitter. At Color I was a very product-centric CEO, but I hate the raw, like five-person, everything is broken stage because it’s just really hard.
But some people love it. So, again, different people like different types of challenges. And the reason I hate it, by the way, is you have no leverage on your time or leverage on ability to do things. So, if you view a team as a force multiplier of impact, you have very little impact when you’re five people. You have a lot of control but very little impact.
Andrew: That’s a good distinction. I think maybe that’s why people are drawn to it. A lot of control, it is also it feels simpler. It feels less structured less like the kind of company that you didn’t want to get a job in when you left school.
Elad: Yeah. And I think that the interesting thing is that people often go to small companies saying that they want to have impact, but really they want to do is have control because if they wanted to have an impact, they’d be running a large product at Google, right? If you have a product that’s reaching a billion people, you’re having a lot more impact than if you’re doing some small startup that nobody’s heard of. And so I think really what they want is control. And people confuse those two things.
Andrew: Speaking of, you had control. You were the CEO of Color. You then decided to leave. You cracked me up on . . . I guess it was Recode where you talked about why you decided to give up the CEO role. Do you remember what you said?
Elad: I think there is three reasons. One was what we talked about earlier, which is at some point, you do get tired of doing the same things over and over again, and so you have to talk through your sales comp again, you have to talk through somebody didn’t get promoted and so they’re upset or whatever it is, right. And so, at some point, you’ve done those enough times in your career that it’s not as exciting as trying other things. So that was one reason.
The other reason was, you know, the company had 100 people and people were ping-ponging between me and my co-founder Othman in terms of decisions and even when we were aligned on things, they’d ping-pong between us because you’d have to just get everybody in a room, but people wouldn’t necessarily do that, and so we wanted organizational clarity.
And then lastly, Othman was always somebody who we always ran companies together, but who could have been the CEO in any context, and so it was time as well for him to really run things and he wanted to . . . He was really excited to do that. So, between those three things, it was sort of time to transition out.
Andrew: And now at this stage in your life, what do you want to do?
Elad: I’m sorting it out. I’m pretty happy in terms of being involved with investing. I’m involved with some crypto things, and this one called Electric Capital on the crypto side. I’m involved with some anti-aging or longevity centric biopharma companies. So can you deter aging via different drugs that you develop . . .
Andrew: Which is what you were studying in school.
Elad: Yeah. I have a PhD in the area, so actually it’s relevant to stuff I’ve done in the past and it’s not the crazy Singularity University stuff. It’s very grounded science out of like a Stanford or UCSF. And then I’m also involved with one or two sort of very early stage incubations where I’m helping other people sort of pull something together really early. And then obviously I’m still involved with Color.
Andrew: You know what? Let’s close it out with just your vision for the future. Cryptocurrency. You’re spending a lot of time there in blockchain. What is it that’s exciting you about it? Where do you see it going?
Elad: Yeah. I think cryptocurrency has followed the trend of a lot of technology waves where there’s this amazing value creation and really interesting technology coupled to like 99% bullshit. So I think like a lot of things in crypto are actually very bad, but there is a sliver of stuff which is truly fundamental and world-changing.
And in particular, if you think about the core things that make a blockchain interesting, it’s the fact that you have some sort of public ledger, although not for all, you have something which is government and sort of general seizure resistance and something which is censorship resistant and so if you ask, “What are the areas where those characteristics are really valuable?” the biggest one is in different forms of money.
And so I think the really interesting thing about cryptocurrencies is the notion of programmable money either for value store, for privacy tokens or for fundraising or securitization of assets like what happens on Ethereum. And so those are the aspects of cryptocurrency that really excite me.
Andrew: The money part.
Elad: It’s basically technology that creates new forms of digital money. And so for example, cryptocurrency is a new way to store value. So, for example, Bitcoin, I sometimes think of is almost like millennial gold or digital gold. That’s an asset that you can hold, but the thing is that you could cross the border with $100 million in your head literally just if you know sort of the right phrase to reconstruct your wallet. And so governments can’t seize it if you need to cross the border.
Or if you look for example, at Swiss bank accounts or Cayman Island accounts, there’s $20 trillion in the wealth stored in those accounts. And people think that there’s somewhere between $250 trillion and $300 trillion in assets totally global. So something like 7% of all of humanity’s assets are kept in a private sort of reasonably secure way. So that to me, feels like a massive use case for cryptocurrencies. So there’s privacy tokens like a Monero, Zcash or things like that.
Andrew: Why is that better than keeping it the way it is right now?
Elad: It depends on what your asset is and, again, the degree to which you worry about malicious third parties acting badly. And there’s lots of history where governments have acted badly. I mean, you see that now in some of the hyperinflationary regimes we have around the world. In the U.S., I’m not worried about the government showing up and taking all my money, but in other countries, I think that’s a real concern. So I think it’s a little bit geographically distributed or dependent.
And then lastly, on Ethereum, you actually see people doing a lot of fundraising and securitization of different assets. So ICOs generated many billions of dollars in fundraising this year in a 24/7 global liquid way. Like anybody anywhere in the world can invest at any time of the day in these assets, and then it was really interesting companies like Harbor which are basically saying, “Well, let’s start doing this for real estate or other areas so that anybody in the world can come and buy 10% of a building in Vancouver.” I think there’s a really interesting concept in terms of opening up global markets and all sorts of interesting ways that a lot of cryptocurrencies will enable.
Andrew: I remember asking Roger Ver, the guy who owns bitcoin.com, what his vision is and he said, “Well, tell me someone who’s really horrible, like, a Hitler person. You know what? Let’s go with Kim Jong-un.” Okay. Like if you need to kill him you can actually put together like a bounty and it’s interesting when I thought about it. And you know what? At the time I said, “I get it,” because he’s really into libertarianism. And then it occurred to me after, if I suck at this interview, couldn’t the same technique be used at me? I wish I’d asked him that follow-up question. But I feel like different people see different value in it and it’s a reflection of their worldview. One of your bitwise. Right?
Elad: Yeah, that’s right.
Andrew: The index fund of cryptocurrency, so it’s a way for people to get invested in it. All right. You know what? I’ve got lots of questions to ask you about it, but I feel like it’s this type of thing that . . . Given where we are, remember before TechCrunch started to organize this whole Web 2.0 world and explain it and to create heroes and villains and also like highlight what’s working and rag on what’s not. Is there something like that today for cryptocurrency, something that’s creating that world?
Elad: Yeah, there’s a few different things that you can read. There’s either . . . There’s actually a number of really good newsletters that you can read. There’s also outlets like CoinDesk which specifically cover the cryptocurrency industry. I think Fortune has a few writers now and they have a newsletter. I can’t remember the name of the newsletter, but you can just sign up and get it just like Fortunate term sheet or some of the other things. So there’s a number of different ways now that you can actually get information about crypto on an ongoing basis.
I do think that you end up spending like six months or a year going really deep and there’s a lot of technology underlying all this, and then there’s a lot of very big idea concepts, and some of them are, I think, are brilliant and really are going to be world changing and then some of them are, I think, going to be in hindsight, kind of like in the ’90s, there’s all sorts of really big picture ideas around the internet and a subset of them came true at scale that nobody ever imagined and then a subset of them didn’t really happen and I think the same thing will happen in crypto. I think the biggest analog actually is, I think the . . . If you look at the ’90s, there was a lot of effectively distributed or decentralized protocols, right? You had SMTP and HTTP and all these different things that are open protocols that anybody can use.
Andrew: Gopher.
Elad: Gopher. But most of the value that was sort of captured and created ended up being in centralized company. So, for example, in the ’90s everybody was saying, “Well, everybody’s going to set up their own email server and run it from their house and they’re going to be able to control their email and all this stuff.” And instead, people signed up for Yahoo Mail and Gmail.
Andrew: Yeah.
Elad: And I think that’s going to happen in a similar way for certain parts of crypto.
Andrew: Yeah, it does feel like that like the world just goes towards that. Every time we think, “Right. This is going to break us free of all these big companies,” like I remember it was even said about water. The bigger soda companies are never going to let us have water because they can’t make money off of it. Well, you know what? Then they ended up like . . .
Elad: Dasani, they own all of them.
Andrew: Yeah. All right. For anyone who wants to go check out Elad Gil’s book, “The High Growth Handbook,” it used to just be available on Square, right? On Stripe, excuse me, and now it’s available on Amazon too.
Elad: Yeah. I was actually launched on Amazon from day one, so Stripe is the publisher of it, but you could always get it on Amazon.
Andrew: Why is Stripe publishing your book?
Elad: Yeah. They’ve actually had a long-standing role in a lot of content for developers are the set of people that are their customers, so they have the atlas guides for different areas. They actually have their quarterly which is a magazine which has a lot of things that are sort of developer-centric. So they’ve been publishing content for a while now of different types.
Andrew: All right. I went straight to Amazon. That’s where actually you linked me to, so I mean, from your homepage, very sparse homepage I think, and I got the Kindle version which I freaking like. I like it a lot. Anyone out there who wants to go grab this book you’re going to enjoy it, but you’re really going to enjoy it if you take work seriously, this business seriously. If you’re the type of person who’s like a wannabe, this is just going to be a drag. If you’re really into companies and you feel like everyone’s just talking about the same five MVP type ideas. Who’s thinking behind it? Elad always think behind it. So “High Growth Handbook” available just about everywhere, but frankly, we’re all going to get it from Amazon.
Number one, and number two, I want to thank my two sponsors who made this interview happen. The first is a company that can revolutionize eladgil.com and take him into the 21st century. It’s called DesignCrowd. Really, genuinely, anything that you need designed beautifully, designcrowd.com/mixergy. Use it while they’re still sponsors.
And number two, the company that will be buying a whole bunch of ads from us next year because you guys keep hiring great developers from them. It’s called Toptal. Check them out at toptal.com/mixergy. And I want to just say one last thing here at the end. There’s an entrepreneur. Do you know Scott Bintz, Elad?
Elad: I’m terrible with names, so I don’t think so but it’s possible.
Andrew: I bet you don’t. Have you ever heard of realtruck.com?
Elad: Nope.
Andrew: No. So here’s the thing. This is a guy, he can’t even pronounce e-commerce properly. He pronounces it like a southern or I guess who’s never been online. A guy starts his trucking company that . . . I mean, truck part company, he sells truck parts online, starts to do well, gets into the tens of millions of dollars. I think he hit $100 million in sales eventually. But frankly, after he got to 3 million he said, “This is just blah. It’s not what I thought it was going to be. It’s just not exciting.”
He decides he’s going to go on a mission to figure out culture. He goes checks out Tony Shieh’s company, he goes checks out Google. He’s got a picture of himself like a tourist standing in front of Google’s sign. Hey. Right? But the whole time he’s learning and picking stuff up. He understands how to create culture, creates culture at his company. His company then grows with this enthusiasm. They’re dressed up in costumes. They’re sending out these notes. They send out these awards.
Anyway, it gets like crazy good. And it gets to tens of millions like I said about $100 million before he sells a company all because of culture. He’s now at a point where he’s doing stuff that he loves, like he makes coffee. My wife is opening up cabinets in our house, coffee is falling down because he sent us so much freaking coffee, I swear. And culture. And I asked him, “Would you come on and talk about culture? Teach my audience how to create culture the way that you did,” and he said, “Sure, I’ll do it.”
So I hired a producer. We created a course with him. If you’re part of Mixergy premium, go check it out. If you’re not check out mixergy.com/premium and sign up. I’m telling you, you’re going to love the way this guy talks and you’re going to say, “This is fun. This is an interesting approach to the kind of company that never got any funding that never even . . . ” I bet he doesn’t even know about Elad Gil, but he did well. Mixergy.com/premium. Thanks so much, Elad.
Elad: Thanks so much for having me.
