Startup Grind Hosts Jason Lemkin

Let's give a big startup grind welcome for Jason Lankin. Let's hear it, everybody. I love the Oprah touch. Very good. Is this one working? Oh, thanks. Great. Can I hand this to you? Thank you so much. Welcome to Startup Grind. Thanks. Thanks for having me. It's great. We're going to get started here. If you have questions, we're using Slido to take questions. The link is right here on the side. Please throw them up there. Vote for the ones you like. And we'll get to those here at the end. How did you get to Silicon Valley? How did I get to Silicon Valley? I went to grad school at Berkeley. And then when I graduated, the Internet was starting to take off and I decided I wanted to work with startups. So I worked with startups for a little while and then joined one in 99 when the Web was sort of starting. And then got the startup bug, as probably every single person in this room has, and never really got off it. So no more. I think I have some interesting stories, but probably coming to Silicon Valley isn't one of them. I think it's the same as everyone just a few years earlier. Were your parents entrepreneurs? Were you always an entrepreneur? Or was this something that sort of evolved over time? I think most of us were always entrepreneurs, weren't we? When I was 13, I ran a bulletin board network. They made a couple thousand bucks a month. And you're always, I think, one of the YC questions when they interview for applications is, what are some of the great hacks you've done that aren't software hacks? And what are some of the crazy things that you've done in your life? And I think not everyone founds a company in their teens, like Mark Zuckerberg or Bill Gates. But I think you're always sort of doing that kooky, crazy, creative sort of thing, even when you're young, usually. Talk to us about some of the, you know, you've started a bunch of companies. Talk to us about, we see you now where you are now. And talk to us about some of the experiences that are ingrained in your mind, scarred in your mind, of the difficult times, the difficult time that you had while being a founder. Well, you know, one thing that maybe is different about me than others in the room, and maybe informs a lot of my approach, is I think at an adult level I was an accidental founder. So I loved startups. I did nothing but startups. I was a VP at a venture-backed company that I joined in 2002. And I was reasonably happy being a VP and working 50 hours a week and doing a good job and never, never ever dreamed of being a founder or a CEO. And then I joined this company that had just raised 30 million, and I realized in nine months I'd be bankrupt. That that 30 million, that everything I thought was going to happen at this company was wrong, and that this reasonably charismatic CEO did a good job of recruiting me to a job I did not deserve to have. But in nine months this company would be bankrupt. And indeed in nine months it was bankrupt. It did actually get dip financing in bankruptcy and later IPO'd. So I missed the bigger picture a little bit, but I was absolutely right that the business model was hopeless and this fancy 30 million in venture capital. I didn't really know what a $2 million a month burn rate meant at that time. But quickly when I got in there and got the financials, I figured out that 30 million with a $2 million burn rate is not the same as 30 million with a $300,000 burn rate. So I said, listen, the one thing that is intolerable is to fail. I can't let this fail. I have to find a way to make a success. I'm not the CEO. I can't do anything. But what I did do is I grabbed the most, the junior engineer in this entire company, and she had done this little lab project that had been a modest success. And we grabbed it, we bought the technology, and we created a startup around it. First, at a loyalty to this company, we tried to sell the technology. So we went to the company that uses technology and we offered to sell it for $50,000. And they said that was too expensive. The public company, everything. You can have the whole kit and caboodle. Because this company was going to go, the company I was working at was going bankrupt, so I figured 50K would help a lot with that $2 million a month burn rate. So I'm a very ethical guy. So I say, for 50,000, you can have the whole thing. And they said, no, that's too much. And then we went to their customers, and their customers offered to support us and give us contracts. So then we said, well, looks like we have something. Would you like to pay 500,000? And they said, no, we'll pay 50,000. And at this point, we hadn't really spun this thing out, but it was getting there. And so we said no to the 500,000. And then we raised the venture capital. We raised $9.2 million at a $2 million pre with a 5X liquidate. Every bad term you read about on the internet, we had in this deal. We could chat about. It was a terrible deal. But I'll skip that, but let me finish the code. So I have an accidental thought of it. We've got to do this. And then 12 months later, the same company came to us and said, well, it's 50 million. And they did pay 50 million. So that was the fun part of the story. They said no at 500, at 50. They said no at 500. And then 12 months later, same exact, same table, same people, same area. Now it's 50 million. And we did the deal in one hour. And were they like, could they look themselves in the mirror? Did they put cloths over? Well, we closed $6 million in revenue from their two largest customers. So there's a reason. The concerns they had about us and our technology and certainly me were very fair. No, the concerns. The original concerns. All the concerns were valid. But when you lose $6 million of revenue in only 12 months, there's a part of you that feels like it might be more than six in the next 60 months. So but anyhow, the only reason I did that, my co-founder, she never thought she'd be a founder either. But we could not. The real thread for a founder is we just could not fail. And we did something without going into the details. We did a technology and a product that everyone in the world, every scientist in the world said was impossible, every single person. And ignorance helps as a founder, especially in this case. But more importantly, what I find is now that I've done 22 investments and work with a lot of B2B companies, I find that at least in SaaS, like the really best founders, like the top half of 1%, they never fail 0% of the time. They always find a way. They always get the customer. They always get the revenue. They always get the financing. They just unstoppable. The ones that are better than me, they're unstoppable. You mean they don't ever fail? They never fail. What does that mean? That's not, that can't be true. It is true. Now, if you're in B2C, if you're in consumer, okay, you have to get some massive network effect to go. Something has to happen, especially in true consumer Internet, right? Or even if you're doing e-commerce and you're selling a 10% gross margin product, like you better really nail it at Jet or like 1% gross margin like Jet, because if you don't nail Jet, you're always one day from going bankrupt. But software is like 90% gross margin, okay? I give you $1,000 for your product, and let's ignore what the salaries are that went under it. It costs you six cents on AWS to deliver that $1,000 piece of software. So if you're willing to work for nothing and you're willing to solve a real problem for a customer and you're able to hustle enough to meet a customer and you will commit your entire life to solving this problem, the most tenacious of us, the best of us, always get customers, right? If we can do the sales and the engineering and the product, if you have the trifecta sales engineering product, and you're insanely good, you always get a customer. It is not that hard. It is impossible. But it is not that hard. Yes. You'll always get one. You'll always get one. Okay, so you don't win every deal. When you get one, it is possible to get two. And when you have two, you have the beginning of a pattern. You might get ten. And when you have ten, a hundred is just time, right? And if you're not tenacious, if you're not incredibly committed, you'll never get from ten to a hundred, because ten is never enough revenue unless you're Palantir. When you say tenacious, what does tenacious mean to you? What does that mean? You are committed for ten to a hundred years for this startup. And you will do whatever it takes. You will work for nothing. You will do whatever it takes to close the customers, whatever it takes to keep them happy, whatever it takes to win in the market. You will do whatever it takes. I mean, we're talking about Qualtrics. Ryan Smith, your friend, he worked in his dad's basement for the first three years of the ten. In the smelly basement, probably in Utah, which is probably musky and smelly in the winter. I mean, normal people don't do that. They might do it for three or six months, right? They might hang out at Galvanizer, WeWork, and have a little fun. They don't work in dad's basement for ten years, right? Crazy people do that. But if you're willing to do what Ryan does, and you have the trifecta, it's not enough to be a great salesman. This is software. So you have to be able to build and ship software and understand the product. But if you have the trifecta, the Ryan Smiths will never fail. They may not build a unicorn like Ryan, right? They may build whatever, a centaur. They may build a tiny business. But they never, ever, ever, ever fail. Never. Not a single founder I've invested in has ever failed yet. Zero. Now, of course, I don't do super early-stage investment. But nevertheless, but I do pretty early, right? But it just goes against conventional wisdom of, you know, Thomas Edison saying he failed a thousand times, you know, or you see the failures that Elon went through in the early days, or you see, you know, I mean... What were the failures of Elon Musk, exactly? Everdream? Zip2 or whatever he had? What were his failures? Yeah, well, he didn't... Travis Kalanick had a few failures at Uber, right? Red Swoosh was a failure. The one that Akima... Scour was a failure. But even those failures, Scour was, like, the second most popular music service when it failed. And it's B2C. It's not SAS, right? And Scour, which was a failure, had, like, five million revenue when Akima bought it. Travis, he didn't really fail, did he? He built two things that had... And I know that Elon Musk failed. You can fail in a low-gross... The difference between B2B and B2C, in B2C, you can fail in a low-gross margin business, right? Tesla is consuming so much cash that if Elon Musk doesn't do everything under the planet, that company's gonna go bankrupt because he claims it has 25% gross margins, but not really, right? Really, it's like 10. But software mints cash. This was the magic of Microsoft, right? It just mints... Like, no one could believe Microsoft had just minted cash, right? You just ship a floppy disk for $100, and it costs you $1 to make the floppy disk. But I think we've been kind of trained over the last five or ten years of, like, this customer development, lean methodology of, like, hey, fail fast, learn from it, keep moving. I hate fail fast. Fail fast is for losers. Fail fast is for losers. Yeah, why? Because here's how SaaS works. In SaaS, and we'll have some fun. Let's talk about Slack as an example. It takes you 24 months to get anywhere. It takes you six months in SaaS if you're lucky to have an MSP, a minimum sellable product. An MVP is for suckers in SaaS. There is no MVP. There is an MSP, and an MSP is a higher bar than an MVP. An MVP is something someone will use. Who cares in B2B if someone will use it? I want to know if someone's going to buy it. If you're the most badass engineers and you know exactly what you're building on day one, you can ship that in 180 days, okay? Let's assume you can even get that done in 180 days. Then you get... And let's assume you actually know anything about sales or at least content marketing. You have one customer. You're a prey. And that customer is $500 a month. That's an expensive product. You're an entrepreneur. $500 is a lot for you to buy at the startup for a product, right? Maybe it's $50 a month. In the early days at EchoSign, our engineers called that beer money. They kept waiting until we had enough revenue per month that it wasn't beer money. I didn't think it was funny, but they thought it was really funny. But they had a point. But we did, as terrible as our product was, it did generate beer money, right? And then it probably takes you another six months, 12 months, until that beer money is enough to pay for one developer, like one non-ROM developer. That's 12 months in. And so roll it forward. You're probably 24 months until you can pay for a 10-person team for real. If you've done really well. Yeah, 24 months. 24 months. And so that's from the real day zero, not from the fake day zero, if you start when you have customers or anything like that. So fail fast in SaaS is for suckers. It's an excuse to quit. It's an excuse for wanderpreneurs or almostpreneurs or B-preneurs to quit because it's so hard to get those customers. And woe is me. I only have $3,000 a month in revenue, and I don't have a great salary, and I made $300 at Oracle. Woe is you, right? That's life. But once you get those couple customers, you can always get more, always. What does a minimum sellable product look like? What does that mean to you? Simple definition. An unaffiliated customer, meaning someone that did not work for you, that you do not know, that came in from the ether, paid real money, and remained a customer for more than a month. If they insta-churn, getting a sucker does not count. Getting a sucker does not count. And that does happen in the early days. No, you don't like it because in a recurring revenue business, the good news is the revenue occurs. The bad news is if the customer churns, you never had them at all. They do nothing for you. You onboard them, to close them, to train them, to retain them, and then you lose them. It's like it never happened at all. But that's the minimum sellable product. And what happens with a lot of entrepreneurs, especially the almost committed, is they actually pull off that. They do the impossible. They get someone to buy yet another boring-ass business product, and then they quit because the math is too intimidating. It's like, wow, beer money. It's going to take me 72 months to get a real business. And at EchoSign, one of our co-founders walked out the door, one of the smartest people I know, because he did the math, and he said, we'll never get there. The math will never compound. And at that moment in time, he was absolutely mathematically right. That beer money was never going to be Lamborghini money. So what changed? How did it change? Time. Tenacious commitment, 20 releases, not quitting, getting on jets, going to crazy meetings, doing non-scalable things, and then you have to have customer support in Europe in the middle of the night, every single night for four months and never sleeping, to understand why our site went down every night. I needed to do all the calls at 2 in the morning. You do all these things, and you go from 10 customers to 20, and 20 to 40, and 40 to 80, and eventually, and then you don't have enough money, so then you stop paying yourself, and then you stop doing anything. But eventually, if you commit for 7 to 10 years, you'll get somewhere, right, if you have a good team. And I was fortunate. I had an even better engineering team than I had realized at the time. We had our quirks, and, boy, we had our battles. But a super smart team. And so if you can keep a great team with you, which, you know, the CEOs that are better than me always are able to do, then eventually you're going to get somewhere good. I think it's such an interesting insight to talk about time, because we are in this, we are in a world that does not value time. It's like, it's now, it's today, it has to happen. And every time you read TechCrunch, you know, you fall deeper and deeper into this pit of despair of like, oh, they're doing it and I'm not. And it's like, but, you know, us doing this for 5 years, what I realized is like, basically everybody that was there 5 years ago, almost all of them have just given up. And we, and what I always say to the team is like, we may not be the smartest, we may not be the best, but like, we will outlast anyone. And you know what, we win. In many cases we are the smartest, in many cases we are the best, but like, just because we are still here, like, by default, we just, they quit and we consume it. 90% of folks will quit. And the flip side is, you've been doing it 5 years, it takes 4 to 5 years for anything to be good. Just to build something. Nick Mehta, who's the CEO of a company called Gainsight that a lot of you folks may know in SaaS, it's sort of the leader in customer success software. He sold his first company, he wasn't a founder but he was CEO for a hundred and something million. And I remember I met him early, he was about a year into Gainsight, and he's like, you know what I didn't realize? It's going to take me 4 years just to get back. 4 years to get back to where he was at the last company, wherever he was, 12 million, 15 million, forget about the exact revenue, but just to get to that point where you're at right now in your business, where it's finally coming together, it takes, whether your revenue then is 10 million, 100 million, or 2 million, whatever it is, it takes 4 to 5 years to get somewhere good. Just to get something. And the real trick for founders, it took me a while to figure this out, and then I saw this pattern in TechCrunch all the time, the flip side is, 5 years is when founders, the very good founders quit. Because what happens is, the first year you're delusional, you think you're going to crush it, and then you don't usually. But the second year you're going to suck it up. And then by the end of the second year, you're too embarrassed to go back. Yeah, you can't go back. I was too embarrassed. I could not go to my seed investors and say I lost all your money. I couldn't do it. I would have been too embarrassed. So you stick it out the second year. You get to the end of the second year, you're like, it's still sort of hopeless, but I have customers, so I've got to do the third year. I've survived a little bit. And then what happens is, the fourth year, you start to pay the price of not having enough of a management team, you're doing too much infrastructure, you're doing too much yourself, and it's just crushing that fourth year. And then the fifth year, unless you get like escape velocity, 10, 20 million revenue for a SaaS company, I don't know what it is for you, but unless you start to hit escape velocity in the fifth year, you just die. Like the human brain gets crushed that fifth year. So there's a bunch of things you have to do. The most important thing is to have a great management team by then. Because if you own, if you're the VP of anything, you're the VP of everything. And to the fourth year, you read these deals in TechCrunch, and you're like, this company got acquired. And these are often seemingly good deals, 100 million, 80 million, 190 million, but they're not $5 billion deals. But these interesting deals, go on Crunchbase and see when that company was founded, actually about five years ago. And these are good companies that got acquired for this amount. And part of your job as a founder is not to let that happen to you. It's just when it gets good. It's just when it gets good. What I found is, like, the fourth year, I started to just get really anxious. And I didn't even know what it was. I'm not a medicated person. I'm pretty well-balanced. I thought. And then I started to talk to my team and say, something's wrong with me. And I just kind of stepped back a little bit, caught my breath, started running a lot, trying to clear my head. And then I just come back in, and now I'm excited about it again. And this same thing of, like, I want to be an entrepreneur for 20 or 30 years, if I can, if I can survive it. And what's another year or two? And I think a lot of people, especially where we live, it's like they roll into town, it's like, what's up, I'm going to be on the cover of Ink in the next nine months. And then it's like, they flame out and they're gone. And here we are, four, five, six, ten years later still doing the same things that we've done, that time has created. Yeah, that's why if you're insanely committed and you can get to those first group of customers, you can't be killed. Let's talk about what... I've heard you talk about that you didn't take a salary for two years. And you went through these experiences, customer service, you know, doing customer service in the middle of the night for months and months and months. Can you just talk...why not become a founder again? Why become a venture capitalist? Well, those are two different questions. I completely became an accidental investor, which we could chat about second if you want. But I think the more important answer is the first one, which is... you know, being... I didn't... So that first crazy startup I did, which was much harder than the second one, the one that we sold for 50 and then 550 million, that was...we were doing the impossible, it was hard technology, it was crazy, I was flying on planes everywhere to crazy places. But you know what? That crazy journey was 12 1⁄2 months long. So I had...I was exhausted. I didn't have any scar tissue. Like, it's not enough. It's not enough time... You can do crazy stuff for 12 1⁄2 months. My brain was not yet rewired. I actually was not... I'm not sure I was a real founder the first time around because my DNA was not changed. And it wasn't until the second time as a... and I wasn't a founder when I wasn't a founder, when I was a VP in successful startups. Was it lucky? Would you consider the first one lucky? Oh, no. It's not luck. We saw white space. We did something people didn't see. We closed 6 million revenue in the first 12 months. I don't think any of that's luck. There's always elements of luck, right? But you... Luck is just timing. And if you don't understand timing, then you just don't understand the markets. So I don't really believe in that luck stuff. And I mean, not that there obviously is luck, but that there's some sort of karmic luck to startups, I don't see that. Elon Musk has timed a lot of these things pretty well, hasn't he? He can see the future. Here's the thing. Let me answer you. You know the real difference that I learned between the best founders and very good founders, great and very good? The best founders can truly see the future. They don't always get it right. But they see the future. In fact, Elon Musk, my co-founder of this first company, he was her intern. And they thought this kid was crazy. They really thought this guy, this little intern, was crazy. But they're like, he could see the future. And so that's the difference. And so if you can see the future, you still need luck. But that timing element of luck, it kind of goes out, a little bit goes out the door. So I don't know, but let's go, I didn't answer your questions. Let's go back to your question. It's all right, yeah. That's my Zen learning. When I was, the second time I was a founder, I had two investors. One is a certain firm, and another one's a firm called Emergence Capital that just did SaaS. And they were very early to SaaS. And in my class, there were a couple companies. There was David Sachs who did Yammer. That was a good one, right, a billion something. There was me, pretty good. And then there was another one, a guy named Peter Gassner who founded this company called Viva, which I believe is worth about $5 billion, and he raised $3 million to get there. Actually more like $5 million, but whatever, nothing, right? This is really the most, one of the biggest successes in sales force. And anyhow, I got to meet all these guys because they were my class, my cohort, and I knew nothing about any of this stuff. And I met Peter, and he tells the future. Not just of his own company, but my company. He sits down with a little eye on it, and he's like, this is, oh yeah! And he's the nicest guy, he's intense. He's like, here's the future. And I'm like, I don't know what Viva does, I don't know what a pharma CRM is, but this is the best guy of all of us. And when you look at the exits, you can see the FI based on who could see the future. And David was pretty darn good seeing the future with Yammer, but not like Peter, right? And then the rest of us were kind of, we could see somewhere between 12 and 24 months out, but Peter could see like, you know, 180 months out. Let's talk about where the bar is with SaaS companies right now. What are the expectations of getting a seed? What are the expectations of getting a Series A in funding? How much do I need? What does my team need to look like? Well, yeah, you know, it's, for folks in the room that are thinking about this, it's hard because it's become a moving target. We can say, holy cow, you know, Slack's last round was at 5 billion and the round before that was at 2.6 billion. And we can kind of snicker at these numbers. Even Stuart Butterfield sort of snickered at these numbers when he said in that New York Times article, this is the best of times going back to the early Roman Empire to ever raise capital. I mean, come on, he's sort of making fun of the valuation. But Slack also has grown faster than almost anything that has ever happened in a paid product, at least so far. So, the Slack, what we have is the Slack effect. So, you read on TechCrunch that all these huge rounds, right, and back when I was a founder, a Series A round was 5 million dollars. Now a Series A round can be 15 million dollars. And these rounds, like, you see these rounds going three to five times higher for the same amount of seeming revenue. But the expectation is epic growth. Epic growth. And then, and when I say this to founders, and it frustrates them. They're mad, like, of course I can't grow as fast as Slack. And I wrote this piece four years ago on Sassler in the early days, when Workday IPO'd, I said, Workday's at 250 million in revenue, growing 90 percent year over year. You better damn well do better. That wasn't quite the right title. Everyone played me for this. They're like, that's not fair. I'm not Workday, I'm not Slack. But what's happened in B2B is the markets are much bigger. They're not just like 300 or so magnitude bigger than when I started 10 years ago, or Aaron Levy or all these folks. They're much bigger than they were two or three years ago. The amount of budget in the enterprise, the true enterprise, big companies, the percent of the CIO's budget that's going to Sass is epically larger than it was just a couple years ago. And it's growing. In the SMB, the amount of web applications that small businesses use is vastly higher than it was not five years ago, 24 months ago. So that's great. It creates a whole new category of applications. It's very exciting, right? We can sell B2B applications today that we couldn't even sell 24 months ago. Because the markets were too small or the customers weren't there. But the flip side is, when you hit it in Sass, you gotta go faster, right? And this is hard to hear. You gotta do better than I did. I was thrilled to double year over year. That was my target in the early days. It's not good enough anymore. People are looking for you, this is hard to hear, but people are looking for you to go from one to 10 million in five quarters or less. One to 10 million in five quarters or less. They're not necessarily expecting 100% certainty that you'll hit that, okay? One to 10 million in eight quarters is still fairly epic, if you think through the math. But they want there at least to be a chance, a shot, a mathematical possibility if they invest before a million that you'll do one to 10 in five quarters or less. So when you put your sales hat on, because selling stock is just like selling a product. I mean, it's selling. If you want to raise a lot of money, sell one to 10 in five quarters or less. That's what people want to buy. And you know what? Just get that in in the first five minutes, plus a good space, and you're gonna get the money. But the data has to be there. If the data isn't there, you know, I met with this founder who I normally wouldn't meet with, it was a favor. I met with him a favor for a friend on Monday. He was three years in, he'd raised three million, he was at 10,000 a month in revenue. The month before he was at 10,000, the month before he was at 10,000. And he told me his plan was like eight or nine million the next year. I don't want to waste your time because I can't get, that sounds great, but I just can't get the, it's the right message. It's just the zero percent month over month growth at 10,000 does not really support it. And so, deepak that, the later you are, right, the more you have proof of that. But Slack did better than that. And so we laugh. You know, Slack raised at 250 when it was doing two million in run rate. Mamoon Hamid from Social Capital did that, who's one of my investors and good friend. And people thought that was a crazy valuation. 250 at two million. Look at its growth. That valuation has grown 20x on paper in 24 months. But he was, he's one of the smartest people in SaaS. He saw that of all, and he was the first, early in Box, early in Yammer, early on, and he saw Slack is the fastest growing thing that they'd ever seen at Social Capital. And so they thought 250 was appropriate. You're not an investor in Slack, correct? No, not a single share. And if you, if you see this thing that happens with Microsoft this week and you're at Slack or you're an investor in Slack, what's your thought? Are you excited or are you nervous? You know, it's a great, it's a great, competition is, you know, in SaaS is this enduring topic, right, that we all obsess about. We obsess about and we all, and you read this annoying advice from our learned elders to, that people over worry about competition, but it is true. But it took me a while to figure out why, right? First of all, you're a adjacent competition, a startup that's just like you except for like one feature. You're like, that's about sales and about out innovating. So build the best engineering team you have, build the best sales team you have. It's incredibly stressful, but that, those are really the inputs that you can do to beat your adjacent competitor. The more interesting one is when you wake up and Microsoft enters your space. Builds your product. Microsoft, and this happens all the time, right? Google woke up and built Google Keep to destroy Evernote, right? Google built the first version of Google Drive four years ago to destroy Dropbox. And the first product has no users. The second product we all use Google Drive, but it does not destroy Dropbox, right? So what do I do? How do I think about this, right? And it wasn't until I was a VP in a Fortune 500 technology company that I had any idea how to think about this. As a founder, I had no idea how to think about it. I remember with Adobe, they bought us and a great partner, but I remember early on we were having a, it was way before the acquisition I was having a conversation with one of the VPs there about partnering. And I wake up and the next morning on TechCrunch I read they're launching a competitive product. Literally the next morning after the VP and I had the partnering discussion and all these people sent me this email they're going to destroy you. Well, it turned out... It's funny how people send that email, right? Immediately, 6am. They don't send the email when you do something great, like, hey man, I'm Ruth for you but when your competitor launches, it's like did you see this? I got from good friends, I got how could you possibly compete? Like how can you possibly win? It's the worst email ever. But let me add to the story. So I call up the VP and I say, listen competition's cool, I'm happy to share when I share information I know that you're going to distribute it but maybe you should have told me about the launch the next morning. Like that was just like a little close in time. Like I thought that was a little below the belt. And he said, honestly I should have told you I wasn't allowed to, but let me just tell you it wasn't even me. It was another group at the company and it was a little tiny experiment and it's never going anywhere. So I thought that was going to be completely true. So my point, that was my first inkling of how big companies work. And so there are many reasons big companies launch competitors to establish products. There are little tiny experiments. Okay, we saw the Microsoft thing. What about Cisco's Slack competitor they launched 60 days ago? Have you, you see a New York Times article on that one? No, it's probably better than the Microsoft product from a software perspective for all I know. So we could talk about it more but what I learned is you need to understand how much effort is being put at the company behind the initiative. And if it's not at the C level, if it's not truly at the C level, worry, but worry with a lowercase w. It has to be at the C level. And it has to be like a four to five year commitment. And if it's not, it's going to be like Google Keep, right? It's just going to get forgotten two years out, defunded, the engineers will get repurposed. And because what happens in these big companies, and here's the one thing to understand on this, here's the startup founder Hubris. I have better engineers than Microsoft. Wrong. Microsoft has better engineers than Slack. Slack has great engineers. I mean it's an iconic company, right? But Microsoft built some pretty good software. And I'm not sure Microsoft has the best 21 year old software engineers out of Stanford. I don't know that they move up to Redmond anymore. But the 45 year old engineers there, like the 45 year old engineers I work at Adobe, best in the world, okay? There are folks that don't like to go to a new startup every 12 months, it turns out. There are some folks that like to go to the same company, make friends, have lunch with their friends. And some engineering skills get stale, but some folks keep them very agile. And my learning is that every big company, there are more great surplus engineers than you have great engineers. More great surplus engineers. So any big company can build a better clone of you than you can ever build. So the real question is, will they sustain it? And I think that's the biggest question. The real question is, will they sustain it? And usually they can't. Usually those 30 great engineers, when we come up on year three and there's no revenue, they get repurposed. Because they've got to go... Microsoft can't sustain it. Yeah, I put 200 engineers on the Slack competitor. Great, it's amazing. And then year three comes up and you know what? I need them on Office. I need them on Word. I need them on Word. No, it's just that headcount's fixed in big companies. So yes, I have 2,000 engineers. And I'll put 200 on my Slack competitor. But three years out when it has no revenue, I'm going to put 190 of the 200 on where my KPIs are. And that's why all these things kind of die after three to four years. How has the product bar changed with B2B companies or enterprise companies in the last few years? Has the goalpost moved significantly in terms of... Here's my scary observation for folks in the room. I will tell you, I'm not going to be talking about the product bar. I'm going to be talking about the product bar. I'm not going to be talking about the product bar. I'm going to be talking about the product bar. I'm going to be talking about the product bar. I'm going to be talking about the product bar. I'm going to be talking about the product bar. I'm going to be talking about the product bar. I'm going to be talking about the product bar. I'm going to be talking about the product bar. I'm going to be talking about the product bar. I'm going to be talking about the product bar. I'm going to be talking about the product bar. I'm going to be talking about the product bar. I'm going to be talking about the product bar. I'm going to be talking about the product bar. I'm going to be talking about the product bar. So, what I want to talk about is that I feel like today the bar of what customers expect in terms of, in particular, what they can do with the data, but in terms of the quality of the product, has gone up truly exponentially in the last 12 to 24 months. And we talk about these trite terms like machine learning and deep learning and artificial intelligence, and it's hard in a, you know, I guess it's easy to understand what that means for a drone. It's hard to understand what it means for a business process piece of automation of software. But what I think it means for SAS is that it's no longer good enough to collect data, to email out data, and to do a workflow. You have to do something with that data that is profound and important to the enterprise. And the problem is...