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[Music] Welcome back to Further Faster. I'm Jeff Becker, your general partner at Antler here in New York City. This show is where we talk about bringing great ideas from inception to scale, where we talk to operators, founders, and investors about what it's like to build legendary companies. If you like this show, don't forget to like and subscribe and share it so that we can bring even more great content to you.
Today's guest, Vivexera, a seasoned entrepreneur and operator, now turned investor. He's co-founded not one but two iconic companies, is the co-founder of Live Ramp and more recently the co-founder of Superhum. He IPOed the first and Superhum was recently acquired by Grammarly. Today on the pod, we're going to talk about how we go further faster, how he recognizes great talent and operators of the earliest days, and how he gets hands-on to help them build iconic companies of their own. Thanks, VC, for being here. Appreciate having you.
Of course. >> Um I was fortunate to go for a hike with you a couple years ago.
That's right. >> And I remember on that hike you shared a bunch of amazing lessons. Um, the one that sticks out to me is resilience. >> You've been through multiple founding journeys. >> Uh, three that we talked about, two that are absolutely iconic. >> I would love if you could just share a little bit with the audience uh, you know, your founding story, how you became an entrepreneur and then maybe we can get into some of those.
Sure. Um, thank you for having me. Uh, and that was a gorgeous hike. >> Yeah. >> Um, up in the, uh, the Fingerlakes in New York. Um, yeah. So, I course corrected my career. My senior year in college, was on the path of being a chemical and nuclear engineering, PhD, uh, doing research on generation 4 nuclear reactors. And I caught the entrepreneurship bug from a class that I took, hard pivoted, um, got connected with a serial founder by the name of Warren Hoffman. He was founding a company circa 2006, so I'm dating myself here. Um, and I didn't know what I was getting myself into. Um, and that was probably for the best because it was a lot of eating glass and it was um, it it very much toughened me and conditioned me to uh, to who I am today. Um and so that company ultimately became Live Ramp, but it was very much um we went through various pivots. Uh, product market fit as a term didn't even exist back then. Uh, we just kind of stumbled into it. And so that company was on this trajectory of having some positive outcome. I saw the the signs and this was circa 2011, early 2012. And so I took a step back uh to found my own company where I was I was at the founder CEO helm uh which was uh the the third company you didn't talk about ultimately failed. Um, it was a um a developer platform. I was at the CEO helm put the cart in front of the horse raised a little bit of money. Uh, and what I mean by putting the cart in front of the horse is I didn't have this maniacal focus on PMF. M >> I thought we would stumble into it like my first company and hard lessons learned including I'm not meant to be a CEO but I love being a founder and made the painful decision to shut down that company and literally the next day this was around early 2015. the next day. So I was at it for three years. Um, scaled the team, downsized the team, kind of went through a lot of hardship, a lot of tear shed. And so early 2015, um when I made the painful decision, I'm like literally looking myself in the mirror in tears and just like realizing my failures, which by the way, I would not change that for the world. I thought that was uh an incredible self-awareness exercise. Every founder goes through this right of passage of failure. But um having this realization and then literally the next day ran into a friend and uh someone who I um who was a business contact for for a few years at that point. His name is Rahul Vora. And Rahul and I reconnected having not seen each other in a couple years. And then he started to pitch me on this idea of rebuilding email for the billion professionals. And we joined forces uh in May of 2015. And that's uh that's how superhuman got started. And >> the rest is history. >> The rest is history. Yeah.
So you started talking about product market fit and the approach to it very different in all three of those and I imagine that changes your perspective on how you coach founders and what you look for in founders. >> Can we just talk about inception the early days? What is a good idea? What is uh what does it look like to get on to the right idea?
Yeah, >> I think the best ideas come comes from one's experience >> uh including their life experiences and so I look for as an investor now I look for strong founder market fit >> um that comes from working within a domain that you care about that you're passionate about and this is not an internship level kind of work experience this is you're going deep you're probably spending at least at least a few years going beyond surface level and uncovering some non-obvious secrets within that domain or with that within that aspect of the market. Uh, and leverage that to um to and identify the opportunity within that particular space. Um, and as long as you're passionate about that particular domain, you've uncovered some non-obvious secrets. I mean a good idea is really an alignment of the stars. So, it's a function of timing of the market. What does the market want? Um, are you seeing some early pull from the market? Do you have you unlocked some non-obvious secrets about the market? Are you best suited to do this better than any other person on planet Earth? >> Right? So, and then you have to get the right team and and so, you know, successful companies really end up being that alignment of the stars and that's why there's few and far in between that end up being successful. But I think a good idea is really rooted in one's personal experience versus trying to pivot your way to a good idea.
Can you talk to uh the first company you had? You said you sort of stumbled into product market fit. >> Yeah. >> The second one it sounds like you tried to force it and then the third and I remember you telling me the story um about who is the best team in the world to build superhuman. Yeah. >> They sound slightly different. >> Can you share some stories about >> Yeah. Yeah. >> About your own journey on the ideation piece.
The second company, we didn't enforce it. I just assumed it was going to happen. >> Yeah. >> That was my naive. So, the first company started out as a peer-to-peer consumer reputation platform. >> Okay. >> We take that for granted nowadays with rating each other with like Uber and Lyft and a lot of the gig economy apps in the market, but we were building this platform that was uh reputational based. And so the idea was using reputation as a form of currency. There's actually a dystopian black mirror episode about this with Bryce Dallas Howard >> um which was kind of very eerie to watch um but I highly recommend that episode >> but um so that that company was originally called RapLaf and we very quickly realized there wasn't pull from this. Um, and so rather than try to capture explicit user generated content that's reputational based co-founder posed this challenge to me of let's gather implicit reputational data. So, I figured out how to map, this is a weekend project I spent. I figured out on a weekend went to the office, pulled an allnighter, figured out how to map an email address to publicly available social data on the web. And this is, mind you, 2006. So, I was user number 700 on Twitter, not an exaggeration. Um, I was very early on all the all the different social networks. I figured out how to map an email address to all this publicly available data. And then we built a crawling engine that indexed all this data tied to an email address. And then we started testing this with friends of ours who had companies and we were like, "Hey, would this data be interesting to you to better understand your users and your customers and unequivocally?" Yes. >> Yeah. >> Right. And people were willing to pay for it. So it was like, "Oh, okay. We kind of stumbled into this." Right. It was not our intention. And then we one of our one of our folks actually an intern of mine figured out how to map all this data to cookies and for advertising purposes. And then the company pivoted again to become this marketing advertising technology data company. Uh, and that's what LiveRamp is today. It's this middleware um for the for the adtech marketing space. And so it was just kind of uncovering these opportunities um as we went along the way. The second company was like okay well again, we'll get to product market fit. So I foolishly started to bloat the team. I foolishly did not have this level of discipline that we end up putting into place with a third company.
And so it was a it's it's almost just cringe just kind of think cringey just thinking about the what I didn't do and what I should have done. Um, hindsight's 2020, but that was very much um a lesson learned about having a level of discipline and focus. I had no discipline and focus around PMF. It was almost like a chicken with my head cut off. >> Yeah. Right. >> When you say discipline, >> what do you mean like tactically? What does that mean for founders?
Yeah. And so discipline means talking to customers, validating like this is this is one of the things I absolutely should have done and would have done if I could do it over again would be to validate with a minimum 100 customers. >> Okay. >> I just went out and I was like, I think this is an interesting idea. Let me go ahead and build this. And for developers who are our target customers, they saw it, they were like, "This is really cool. I don't have a need for this though." >> And so it was very much a solution in search of a problem. >> Yeah. >> And so I didn't do that validation. And and I think that's incredibly important to validate with customers and validate the problem and validate what you're building. And so and having having that level of discipline where you know when I talk to founders today the ones that get me excited are the ones who are not the ones who have a a long form notion page where they spoke with you know 10 or 15 customers but they have a Google sheet with a 100 rows 150 rows 50 columns of data and they have this maniacal focus around the data collection and it's just a demonstration of their curiosity and intensity. >> Yeah. >> Right. The ones who are like, "Yeah, here's a long form notion page that's not disciplined or not structured and um it's it's lacking in terms of like the number of of customers they've actually spoken with. I'm like, >> yeah, >> I I've had many of these conversations where I will ask founders to show me the the customer data and I'll see it and I'm like, you need to collect an order of magnitude more data. >> Yeah. >> Right. Cuz that's where you start to uncover the kernels of truth around what you're building. uh, you know, a startup at the end of the day is a series of experiments to unlock psychology within the market and within the customer and it takes time and it takes a lot of reps and a lot of interactions to validate what you're building who the customer is is it the right customer is the right ICP is it the right problem are you building the right product etc. The third company was superhuman coming into it I had this scar tissue and this huge tip of my shoulder from the failure of my second company, which by the way is an attribute I look for in founders is like the ones who have who have a chip on their shoulder. But I had this huge chip on my shoulder where it was like I absolutely do not want to experience that failure that I experienced with my second company ever again. I mean, it was incredibly painful. >> Um, you know, the disconnect between my expectations and reality created a lot of pain. Um, and so going into superhuman as we were um as we were building out the product and we were doing a lot of validation early on >> you know, a testament to my co-founder Rahul but we were talking to our ICP which are founders CEOs investors executives >> and we had hundreds of these conversations >> before we built the product as we were building the product along the way the product market fit engine that we ultimately built came out of this frustration where all the literature that was out there, you know, it was like lagging indicators. It was like, you know, when you get to product market fit, when XYZ happens, >> right? >> And that wasn't good enough for us. That wasn't helpful. So, we we we're looking for a leading indicator. And so, >> I'm happy to kind of dive in further on on like the product market fit piece, but we've actually codified the the framework and the engine and this m this uh this content. We open sourced the community, first round review, syndicated it, etc. Um, but we we built rigor around our approach. So, not only were we building a product and we were starting to build out the team, but we built an engine, an operational engine that started to capture early product market fit data and we iterated and tinkered on it internally until we started to see the fruits of that engine and then it really then the company really started to take off from there.
Yeah. And is that something that you think can be taught? I mean, I've read the first round of view. It's it's a I mean, it's a storied post in at least our circles when we're working with this many founders, but is it something that you believe can be taught or needs to be innate? And when you work with founders, how do you impart that on them if they're not um if they don't have that experience that you had where you saw it not work and then you saw it work and the magic that happens when you do focus on product market fit the way you have?
Yeah, great question. I don't think there's one way to get to PMF. I think there are many ways to get to PMF. We just happen to demystify a way, >> right? So, I just want to caveat there. I don't care what way founders take to get to PMF. I just want them to have a level of discipline and intentionality around it. >> I didn't have intentionality. We stumbled upon it with my first company. I didn't have intentionality around it with my second company and we saw what happened there and then there was a lot there was an immense intentionality around that with the third company superhuman and so I look for founders who have intentionality around PMF and the pursuit towards PMF because I invest at the first check preede stage at inception and preede >> it's at the zero to one stage it is always companies that are pre-product market fit and so I look for founders who have um just some approach uh it whatever it is now the the superhuman product market fit engine that's a way and and I've had many founders reach out to me um and I've talked to many founders about it like hey, this is a way I'm happy for you to evolve or do something different but at least just do something right >> right and the root of it is really around having a feedback loop with customers So putting aside picking the right ICP which I think is one of the most important decisions founders will make in the the journey of their company. >> I would call it like a top five >> most important decision. Um, having a level of outreach and a level of um communication with customers and just having this and and h being very disciplined about the data collection piece and h having rigor around that. I don't see enough of that in the market. And so that's something where I think many founders can it would behoove many founders to just be more rigorous around data collection, collect a lot of data uh as they have conversations and increase the the volume and velocity of the conversations that they're having. >> Yeah. >> You know, for for some there are founders where it's like how many customers have you spoken with today or this week? And it's like I spoke with two customers this week. like you should be talking to 10 customers a day at the stage that you're at right now, right? Like let's let's go. Let's increase the velocity here. >> Let's amp it up. >> Let's amp it up.
Define the sixth gear. I um I meet a lot of founders for those that are watching that have ideas, like you said, are solutions in search of a problem. They haven't spent enough time with the problem. Do you find with founders that it's okay to start there so long as they have the rigor to product market fit or do you think that you need to start with the problem always?
I don't think anything's absolute. Okay. >> Right. So I don't think you always have to start with the problem. I would say success falls under a Gaussian distribution and you probably have two standard deviations beyond the mean where you have a segment of folks who end up becoming successful with a solution in search of a problem. But for the rest of us and the other other part of the bell curve, I think it's it it's important to absolutely have a sense of the problem because if you if you create something and you're like, I think people will want this, you're spending a lot of time marketing, you're spending a lot of dollars just marketing and educating the market. This is something I experienced with my second company where I was educating folks like why you need this. Now, you know, it's different if you have the coffers of an Elon Musk or the brand and the power of someone like that to really affect market dynamics. But if you're someone who is coming out of college, you've worked few years and you're starting something and you're trying to spend all this time, sometimes you have to wait for the market to catch up like Brian Armstrong did with Coinbase, right? He was very early, very early with Coinbase, but ultimately the market kind of swung in his direction. >> Yeah. >> But I would say for everyone else, for the rest of us, it is it is strongly recommended that you have an intimate understanding of the problem, an encyclopedic understanding of the problem, of the market, who is experiencing that problem, the buyer, the user, what's the competition look like? what's what's missing with the competition's um attack of the problem. Um, and then really intimately understanding the wants and needs of the person who's experiencing the problem and go deeper and like how they feel, right? And so it's this level of curiosity and intensity around the problem space to the point where you are world class. You're in the top 00001% of of entrepreneurs and founders who who intimately understand the problem space. I think that sets you up to figure out, you know, if you have the the right product mindset coming in to figure out the right solution, the right product to address that particular problem.
Love it. Um, so you've actually, you've hinted at a few things you look for in founders. We've talked about this obsession. We've talked a little bit about founder market fit and being the best in the world to solve it. Having unique insights, having rigor around product market fit. What are some of the things that that you're looking for?
Yeah, I look for founders who beyond founder market fit and who've uncovered some non-obvious secrets in the market. Um, I look for founders who exert control. I I mostly interface with the founder CEO. >> I think the best founder CEOs are control freaks when it comes to the vision, product, customer, and culture. Everything else can be delegated out. But when it comes to those domains, the founder CEO needs to exert control. So I really will poke and prod and spend time with the founder to think about how they approach those specific aspects of their company. Um, I look for founders who as I mentioned have this encyclopedic understanding of the market who have a chip on the shoulder. I have to believe that this person is best suited to do this better than anyone else on the planet. You know, if Rahul, my superhuman co-founder, if he had pitched me on the idea of building an autonomous vehicle company, >> yeah, >> be like, hey, you're you're not the right person to do that. >> Yeah. >> Right. There are three people in the world I would have started an email company with. Paul Bukai who created Gmail, Brett Taylor, and Rahul Vora. >> Yeah. >> And he's best do best suited to do this because he has been thinking about this. He's been building in the space. He is uniquely positioned to build this company. >> Yeah. >> Better than anyone else. Yeah.
I remember you spoke to some of our founders a couple years ago and you shared this story. I think give everyone chills. You talked about how uh like building email doesn't sound that sexy. >> Yeah. >> But you talked about how uh you sort of got you got warmed up and indoctrinated to the idea. >> And you talked about what Raul had shared with you and why he thought you guys would be the best team in the world to do it. And I thought that that level of inspiration to inspire someone on something that maybe others wouldn't find to be inspiring is another superpower. It's almost it sounds like a bit of a exerting some control.
Yeah. No, I mean he's a master at reality distortion. >> Yeah. >> Um, but you know, he said to me, it's like I wasn't thinking about fixing email >> circuit 2015 like like everyone else. Um, but I love the productivity space. And mind you, superhuman after the fact has very much influenced how I invest and what type of companies I invest in and what type of founders I look for. But he said to me back in 2015, he was like, you know, VC, it's unlikely that folks like you and I are going to find solutions to famine or war. It's unlikely that the VCs and the raw holes of the world are going to find a cure for cancer or AIDS or take mankind to Mars. But what we can do is create tools for people that are augment their natural capabilities with these software and tools. Give them superpowers and make them superhuman. And I'm like reliving this. I'm getting goosebumps again just kind of rethinking this. Um, but it I you know, I I closed my eyes. I saw the future the next 10 years, the next 20 years. I was like, this is a once in a generation type company. This is a once in a generation type founder. Um, this is absolutely someone that I need to pair with and work with on this. You know, the the idea of saving people time, whether you're a teacher, a doctor, you're an architect, you're um, you're an engineer, who whoever you are, to be able to help those people save time and move faster and be that much better at what they do. So it increases the global GDP and it's a net positive to society. It's like absolutely love the mission behind what we were building with superhuman to the point where you know, I hired the first 30 people in the company and I was boots on ground talking to all the engineers and engineers would you know, initial coffee meeting would just kind of scoff at this idea of like email and at the end of it they're like, wow, okay, that's a really intriguing opportunity and I just translated the mission statement and what we were doing the the greater vision around it and then just brought that to the engineers that I we were trying to recruit. Um, and yeah, I mean, it's uh >> it it still gives me goosebumps just thinking about it and and seeing the evolution of Superhum today. It's it's been um the best professional experience of my life.
Yeah. Just having people like wanting to run through walls on something that they all share as a common goal, I think is like a fun way to wake up in the morning, a fun thing to look forward to going to do every day. Yeah. You know, >> um that's awesome. I mean, I like I think about that and I think one of the when I look at our founders and I talk to our founders, I think they're underestimating a lot of the jobs of being a founder. They're underestimating the discipline to being uh focused on product market fit. They're underestimating how many customers to talk to on a daily basis. they're underestimating what is required of them to inspire great people to join them. And then I hear you talk about your experience and I'm like this bar could not be higher. >> And so how do you set that bar with founders because there are people that >> uh maybe will grow into that role and they'll they'll their ceiling might be very high and their trajectory could be really steep, >> but there's also a lot of people that probably shouldn't be starting companies that need that conversation that this is harder than you think. Yeah. >> You know, your bar is too low. Like how do you you must see tons of founders coming to you for advice, coming to you for investment. How do you delineate those who have it and those who don't?
Yeah, I mean I see 400 companies a quarter. I invest on average one one to two companies per quarter. So I see a lot um kind of come hit my inbox, come across my plate. Um, yeah, it's um most folks should not start a company, right? Okay. And I think you have a perversion in the market where you have an abundance of capital and that abundance of capital from VCs and then from their LPs uh is creating a ton of noise with all these found like folks from like you should not be starting a company, you should not be starting a company, right? um this you know when I have conversations I will really dig in on you know when you're you're investing at inception stage you don't have data about a company >> right >> right there's the there's the art of company building the 0ero to1 stage and then when you hit product market fit then becomes the science of company building >> and at that point I think that's where most investors should live I think most VCs should operate there I think any I I mean I should probably check what I'm about to say, but but I I have a bias towards investors who are very early stage who've been founder operators before. >> Yeah. >> They game recognizes games. Steve Kerr recognizes Steph Curry and helped them be the best shooter and helped the the Warriors be the championship team because Steve Kerr worked with the best when Michael Jordan, right, when he was on the Bulls and Steve Kerr was a fantastic shooter. So for me, when I um when I see founders very early on and I'll spend time with them, I often have to dig into their psychology, right? >> How they think about things, >> how have they been wronged in life, like what what is the chip on their shoulder, right? Um, what underlies that is a level of resilience, right? And that that resilience piece is so important. And so really trying to, you know, through conversations and spending time with founders, sometimes I'm spending months with founders like they haven't even incorporated the company and they're still trying to figure it out or they're selling the founding team. And just, you know, this is what I did with some of my early investments out of the fund is there was no data about the company. It was just the founder and really just spending time with them to unlock their psychology and and see what makes them tick and what motivates them and where does that resilience come from. You know, there's a a founder I invested in called Mahendra. Um, he's founder of a cyber security company called Deept Trail. And Mahendra is the most resilient founder ever. >> Yeah. >> Like he just keeps going and keeps going and keeps going and keeps going and keeps going and I'm just, you know, my job as, you know, someone on his cap table is to try to support and try to encourage and like keep going, keep going, keep going, you know. >> Yeah. um whether it's um you know kurfuffles with the founding team or kind of changes in the market or something happening with customer just keep going keep going keep going um you may not often have the benefit of capturing data over longitudinal time period right and this is where it's helpful to have worked with someone to have known someone so there are founders who I've invested in like Adam Schwarz at parable I've known him for 15 years. >> Yeah. >> Right. He started he was telling me he was going to start his first company. I was like, "Hey, or his next company." I was like, "Hey, whatever you do next, make sure I'm your first call." >> And then I end up committing cuz I I had that longitudinal data, right? And I saw what he did with his prior companies. Um, so that that level of resilience, it's it's hard to pick up on a 30-minute call and making an investment decision off of a 30-minute call. >> Yeah. >> And sometimes you just have to spend time with the founders and see how they deal with hardship and see how they deal with certain aspects of the zero to1 company building because it's not glamorous, it's not fun. >> Yeah. >> You know, it's a lot of grind, it's a lot of hard work, it's a lot of sacrifice, right? Um, and the ones who stick with it and who don't waver and who have this, it's almost a level of delusion to be a founder. You almost have to be delusional of just like you're not listening to your peers. You're not listening to your significant other, the market, your family, your friend. You just keep going. >> Right. >> That's that's what I kind of look for. >> Yeah. >> Right. Yeah.
That's awesome. Um, it's it's so interesting. I like you mentioned it, but like when you're on someone's cap tip, but you feel like you have to support them. I see some founders doing things that objectively are not good for them, their families, and their own health. As an investor, how do you think about encouraging them to keep going when you know, like I mean, you've been there. You've had to make that hard decision of shutting it down. >> Like, what do you do as a as a good steward of your LP's capital, >> but also someone who cares deeply about the founders and I know from personal experience, you get your hands on with the founders, so you're you're in there with them.
Yeah. I I mean I I can be hands-on when the founder wants it. >> Yeah. >> Right. And so my product to founders is I'm a fractional founder in the trenches on an ondemand fractional founder. So you want to get in the weeds on the three biggest pain points with zero to1 company building are product market fit fundraising and recruiting. Yeah. >> Um, and most investors in the market who are early stage have the rolodex and have the networks around other investors and maybe some engineers, but very few can intimately go in and surgically diagnose and analyze what's going on from a product market fit lens. So, um, so I I can do that and I actually I very much enjoy doing that um, as an investor. It's why I now on the other side of the table. But I've had, you know, I get the monthly updates. Yeah. >> And I see how much runway I've had calls with multiple founders there for my angel portfolio where I've had to kind of give him a kick in the ass and it's not fun. And you know, there was one where um the founder is based in New York or was based in New York and you I was like, "Hey, let's meet for coffee." And he was like, "Everything's rosy and peach and keen." I was like, "Hey, uh, your company's gonna die. It's not. Um, you need to course correct now." And he's like, "What do you mean?" And I started to dig in and then really start to dig in. I'm like, "You have this much runway. How much are you paying yourself?" Oh, you and your co-founders are paying yourself 175 to 200k a year each. >> Not going to work. >> It's not going to work. Right. And he had to lay off a couple folks on his team, cut burn, they took um uh all the the founders took a pay cut and the company's now flying. Like it was a hard it was a course correct >> and now they're kicking ass and it's awesome, right? And it validates kind of that kicking the the ass that I that I felt I need to do. >> And you know, and I was like, who else on your on your on your cap table is giving you it's like, okay, like, all right, I'm glad like I'm here uh putting my ego aside, I'm glad I'm here to have this conversation with you, but I've had to do this multiple times. >> Um, and so I don't enjoy it, but it's it's no ego. I'm like I I'm not there's no nothing personal here. I want you to win. I want every founder to win because I love the the industry that we're in is we're creating value to society. No disrespect to Wall Street, but we're not in it just to like Wall Street's about making money. And sure, I'm a hardcore capitalist, so I I want to make a lot of money. Yeah. >> Right. But when you align the wealth creation with the value creation, it's like we we have the we're in the best industry, right? So I want founders to win. And so I go in in calls with founders, even when I have a pitch call with a founder, I will tell them from the very very beginning, I want you to win. >> Yeah. >> And I'm going to do everything I can to support you. And that might mean I'm going to pass on investing, but I'll give you feedback so that you do better next time. Right. And so for founders, you know, sometimes they need that. Um, the ones that I invest in are the ones that will eventually get there. I like to think of myself as someone who can help supercharge them, hence the name of my fund, and kind of get them there faster, whether whether it's kick in the ass or best practices or playbooks or frameworks or, you know, lessons learned or anecdotes, whatever it may be. But, um, yeah, I mean, that's that's uh part for the course. >> Yeah. Yeah.
I don't know if I've shared this with you, but I've actually changed the way I interview founders from our talks. This idea of resilience and this kicking the ass we're talking about. I want to get this longitudinal data you mentioned. I want to ask them questions about who have they fired recently? Have they fired anyone ever? What happens if this goes wrong on the team? But I also, you kind of alluded to it. I want to dig into their their childhood and their upbringing and what hard things have you been through. Because you've told me a lot of stories over the years about your resilient founders, the people that make the hard choices. And the more and more I've seen it, the more, you know, it becomes very obvious that those are like table stakes. It's not personal. You have to make strong decisions. and the business has to come first in every scenario. >> Um I don't think that's ever been more true than now because we have this market where >> you know money is sort of flying in on this hype of AI. >> Yeah. >> And maybe I'll leave the word bubble out of it. But >> I don't know that founders are all building in a durable way. >> Yeah. >> Because of this. >> Yeah. >> And I'm sure you have strong opinions on this.
Oh yeah. >> So I'd love to hear >> I have so many opinions about this. By the way, during my time at Superhum, I would be the last person to interview a candidate towards the the tail end of of my tenure there. Um, and I would do these famous or infamous 2-hour long walk-in talks with candidates. And this is across engineering, support, success, executive roles, whatever it is. And I would go really deep from childhood. >> Yeah. All the way to present day and really try to understand like every single role they were at, what they did, why they left, what were some of the challenges, how they dealt with these particular situations. And so coming out of it would have such a comprehensive understanding of the candidate that I brought that into my assessment with founders where I spend significant amount of time and I'm just incredibly naturally just curious about people and I love people. I'm not the smartest person in the room. I'm I'm probably one of the more harder working. I'm not the prettiest or the strongest, but >> give yourself some credit. >> Appreciate it. But I I pride myself on my ability to be very people oriented and people focused. Um, and and that's paid off, you know, paid paid dividends. Um, remind me again the question it was >> talking about how to build durably. Okay. Yeah. >> There's like >> oh man, >> I've someone told me once and maybe this generates some my thoughts for you, but um if you have a box of tissues or you have a handkerchief and you're sick, if you have the handkerchief, you're going to use like every inch of it. If you have a box of tissues, you're going to use every tissue. And I find founders are similar. When the coffers are full, >> let's just spend to fix the problems. Instead of firing this person, let's just move them over to this other role. >> Let's skip over some of the product market fit type stuff. >> And they start making these bad decisions that not only impacts the product, but also the culture. And um one of the things I've been sharing with founders more recently is I found there are two kinds of founders. the ones that um search for gold themselves and then pay to extract it >> or the ones that pay raise money and pay others to search for gold >> and they spend a lot of money and they burn it. >> Y >> and you want to be the former, right? You want to do all the hard things, the things that don't scale the, you know, have the conversations, the 10 customer calls a day and when you find that goal or those unique insights, go raise the money and extract all of it. >> Yeah. And I find in this market it's just hard emotionally for founders to do that because the money's there and because it's easy to outsource the thing or delegate the thing or you know think that you're smarter than you are. Yeah. >> And so I just I was curious for your take on that.
Oh yeah >> that lens given the availability of capital right now. >> There's an epidemic of entrepreneurs and there's an epidemic of investors who are kind of perpetuating these entrepreneurs that are out there in the market. I see a lot of founders who are not good stewards of their investors capital when they raise money they should think of it as their own money and instead they're spending money on subway ads and billboards and you know I'm not going to name specific companies you can probably guess who they are but like rage baiting on Twitter and just like this this is not how you build a durable company right and I think those companies are are experiencing some some premature hype, don't have product market fit, and there's going to be an implosion. Um, seen this time and time and time and time again. The the the founders who view less capital as a feature, not a bug, those are the ones that get me really excited. And you know, with the 26 companies I angel invested in, which I did mostly preede and seed, um, there was there were conversations I've had with founders that where they were getting a lot of bad advice from their own investors. Some of them are GPS at tier one funds. >> Yeah. >> Right. And >> node coastly says like 90% of uh VCs at negative value. >> Yeah. Yeah. And and I've had I I had one I had a conversation um a week and a half ago with a portfolio founder where one of his investors on his cap table um gave a lot of like bad advice and I I was like, "Hey, we need to jump on a call here and I need to kind of course correct because this is not setting you up for success and this creates potential litigation issues and like legal issues if you go down this particular path." Um, and so I'm glad I I intervened. But in in terms of durability in today's market, that doesn't come from having an abundance of capital. An abundance of capital corrupts. And so when you have less capital, it forces discipline. It forces innovation. Um, it it forces the right kind of principles around operational company building. You know, to to give you an example, I'll give you multiple examples actually. So, from my own experience, the company that ultimately became Live Ramp, we raised a $1 million series A on a 5 million post. This is 2006. >> We raised a $4 million series B. We raised a $15 million series C on a 60 million post. That company is now public. Peak market cap, I think it was like 5 billion. I think somewhere two billion plus today. Two to three. Um the founders each paid themselves 50k a year. I came out of college with student debt, but I was paying myself we were we were all paying ourselves 50k a year and then when we raised the subsequent rounds we we ramped it up with superhuman all three founders we each paid ourselves 75k a year until we got to series A and then we increased 100k a year and then we got to series B then we increased it to 125 to 150k a year and then when we got to series C I think then we leveled it up to what the market rate salary was for our respective roles. um you know we weren't spending money on user acquisition with the you know and and growth marketing and these kind of tactics. So whenever I I ask founders you're raising 3 million or you're raising 2 million or however much for your preede like how are you thinking about the the utilization of it and they're like well SEO and ads and this and that. I'm like that that is not going to get you to product market fit. >> It's like a dagger as an investor in your heart. You're like you know that that's not what I want you doing with this money in this stage. We didn't spend a single dollar in user acquisition at superhuman until 2021, 6 years after we founded the company. >> It was such a focus on building a product that our ICP felt joy around and loved and the word every single person we onboarded on average referred 4.2 people. >> So we onboarded someone, they were refer four people and then our our weight list just ballooned from there. And it was unheard >> this focus on just building this maniacal focus on PMF and building something that the end user wants. And today's market the number of founders I speak to where they say, "Yeah, I just raised 5 million from insert tier one fund who has a $10 billion fund." Uh, and I'm like, you know, you raised like 25 post. And it's like this is not setting you up for success because your next round has to be minimum 50, right? There needs to be a minimum 2x jump in valuation >> um between rounds and what's necessary to get to a 50. You're not you're not setting yourself up for success here. So when you have less capital, it creates a crucible moment where founders I mean ideally there's 24 months of runway with a minimum viable team. I've seen this mistake that founders make where they raise excess capital, they they hire, you know, they have seven to 10 people. It just bloats a team and things just move slowly, right? Your job at the 0 to1 stage is to get to product market fit and nothing else.
matters. So raise the minimum viable amount to get to PMF and and having that minimum viable amount of capital, it forces constraints, it forces focus, and you can't pay your way out of it. You can't hire your way out of to get to that to solve that particular problem around PMF.
You have to innovate and sometimes you're banging your head against the wall trying to get there. But having an abundance of capital and that luxury corrupts the path and then you have this falsified sense of hey you know whenever I see founders like we have product market fit I'm like no you don't. No you don't. Right. You think you do.
Yeah. And it's this it's it's a it's a level of delusion that you know while I do look for delusional founders in terms of like how like what mission they're going after should not be delusion delusional around the market's perception of what you're building. Right.
Right. You you have to be grounded in truth and you have to be realistic here. And so I just think money cup corrupts. And this is where I will try to come in very early with founders and relay some some horror stories and some anecdotes and like, hey, you want to look out for this and kind of prime them of like, hey, you should eat your vegetables because you're going to get a lot of candy and chocolate thrown your way and here's why you want to have good nutrition in your system, good operational nutrition in your system because you're going to get the temptation of, you know, the sugars and you need to you need to fight that off. And so that's why I come in very early um on the investing side coming in and say, "Hey, look, you might want to you might want to take us a piece of that 5 million or you might want to structure in this particular way."
You know, with Superhum, we had our series A preempted. Um I fought tooth and nail against taking it. Wow. Um so we had raised a $4 million seed led by First Round. We had a big LP who's an LP in in first round and a few other funds that invest in us and they're an LP in multiple tier one funds. They like to do one direct deal a year. We were the direct deal they wanted to do. They reached out through through multiple of our investors. Co-founder R was like, "Hey, we have a blank term sheet." Um this is I want to say circa 2016. Yeah, around 2016. And um it's like we have we have the opportunity to raise 10 million um blank term sheet whatever terms we want and we spent a Saturday debating for like I don't know four to six hours.
Yeah. The three three founders raw hole like we should take it. I was of the the mindset we shouldn't. Um he ultimately convinced me uh because of his reality distortion. Uh, no, but he was like, "Look, we may need to acquire some smaller companies and aqua hire and, you know, in the productivity space and we were repeat founders."
Yeah. So, I I trusted the fact that we we were repeat founders, but I was like, "Look, if we take this, I'm agreeing to it on these conditions. I'm the CFO, the chief frugal officer. It cannot negatively affect our culture and we need to put appropriate controls in place around this." And so, we that was a Saturday. We signed on Sunday, we announced the team on Monday and every single all hands thereafter. We did not talk about the raise. We did not show that >> y >> at all. Um, you know, we just showed the capital that we had in our bank account against the seed seed raise, not the series 8 10 million raise.
Yeah. So, I put that in a high yield savings account. This is pre money market accounts being a thing. And that acred yield and that was meant so that we would continue to operate like a seedstage company, not a series A company. because I knew what would happen end up happening which was folks slacked and they were like hey can we have a 401k account can you increase my salary and it's like no like we're not going to do any of that until we're cash flow positive just this is a rainy day fund pretend this doesn't exist and founders today don't exercise that level of discipline but I knew we had to do that.
Yeah, you earn those traits. 100% right and it's like in order to maintain our culture in a particular way.
Um so those are the type of controls and the type of thinking I like to see with founders. It's like, hey, if you did have this, what would you do with this capital? And the ones who are like, it is super important for us to be disciplined and focus like we're not going to get a big office, a nice fancy office. That's usually a negative signal. Um, we're not we're not going to bloat the team. We're not going to do this. Um, those are those are those are the the traits or those are the the like how I how I I like founders to operate. I'm just kind of coming in with that approach.
Yeah, I think there seems to be a direct correlation with frugality and outcomes. And I don't know if that's a function of the way you do one thing is the way you do everything, but like when founders are paying themselves less when they're putting every thing they have into their company.
Yeah. It usually is a sign that they're doing that with every decision as well. And I just find that to be such an important thing. Like being all in on it requires you to be a system level thinker. Like the company has to work. This isn't about you know how much money I'm making.
Yep. Um, you're in service of the mission, right? You're in service of the mission. This isn't about your ego. This isn't about putting a co-founder or founder title on your LinkedIn, right? You are a steward of this mission. You are a steward of creating this thing that benefits society.
Yep. And you're doing what's necessary and have the right conditions in place.
I feel like we've been building up to this. You know, we focus a lot of this time on product market fit. How does a founder know when they've reached product market fit and to make that switch from, you know, uh, zero to one to the science of company building?
Yeah, I mean, you're going to feel it. There there's the the feeling aspect where, you know, the the lagging indicators are investors are knocking down on your door. You're getting a lot of inbound from investors. you have, you know, maybe journalists and folks are trying to reach out and trying to get more of a scoop on on what you're building. Um, you're getting invited to speak at conferences and events and just like, you know, so there's there's the lagging indicators, the pull that you're you're feeling.
Right? The approach that we codified and open source to the community was very much more of a leading indicator approach where you are getting data from the customers. So you onboard a customer and ideally it's past a certain indoctrination period. For some products that could be minutes, other products could be months. For us at Superhum, it was anywhere from 48 hours to a week and a half. So we waited about 2 weeks and then we would send a plain text email from the CEO asking a set of questions. What do they love about the product? What don't they love about the product? How disappointed would they feel if they could no longer use Superhum? And that was a product market fit question. And it was a question that's orthogonal to MPS. So the the options are very disappointed. Someone disappointed or not disappointed. And there was a gentleman by the name of Sean Ellis supposedly coined the term growth marketer. He was early at Dropbox and Eventbrite and consulted with 100 plus companies. He unlocked this science around PMF where he found that if 40% of customers answer very disappointed, you've hit product market fit. If you're able to sustain that, then you've hit product product market fit. Um it's not just specific to one cohort.
So we took that and we baked that into this this engine that we built out and we were at 32%. We were initially at 22%. We removed some personas that were corrupting the data because they weren't part of the ICP. Yeah. And that jumped up to 32% and then just kept going from there and you know got to about 55 60%. But there's something about that 40% number where when we pass that threshold, there was just a lot of inbound, a lot of attention. And then I was seeing a lot of these, you know, there's a YC demo day circuit 2019, 2020 where it was like um there were 10 companies pitching where the superhuman for X and I counted and I was like this is this is weird.
Right? We're the superhum for accounting, we're the superhum for DevOps or whatever it is. Um, and so you start to see a lot of activity kind of happen when you have product market fit. But the when customers are pulling the product out of your hands faster and you can deliver it to them, that's a clear indication.
Yeah. And does this look like a is this a dashboard in the office as 40%. The graph and everyone knows and everyone's.
Yeah. We have a big flat screen where we have metrics that we're tracking and that is one metric amongst many that we look at. There's another one uh called delightedness. So we would see there's this is an internal metric that we're tracking and that was an indication of retention.
So if they if someone was basically if someone is sending 90% or more emails through superhuman we call them delighted. And when they hit that after about um it was like two to four weeks when they hit that threshold um we knew we were going to be a lifer on the product. But if it was like 60% of delightedness um versus the 90% delightedness then it was just like okay we need to do some work with that customer to figure out are they the right did we actually on board the right customer because not every customer is the right customer in the beginning. So choosing the right customer very much dictates the trajectory of the company.
Incredible. Yeah. Um, I would love to spend a little bit of time just tell me quickly about Supercharge and what you're doing today and what you're looking for and uh, for those watching, I'm sure they're interested in how they can find you and pitch you and have some of this insight on their cap table.
Yeah. Yeah. Uh, I'm um, VC at supercharge.vc. Uh, my Twitter is Visera, but um, Supercharge came out of my experience at Superhum. though I did three tour duties as a founder almost 20 years and I had been actively angel investing towards um the last year at superhuman and start to institutionalize my angel investing where I would spend 70 hours during the week on superhum Monday through Friday and I would tell founders hey if you want to talk let's talk on Saturday Sundays so I would get 10 pitches on a Saturday 10 pitches on a Sunday and I I started to institutionalize that with the intention of going into venture full-time. Now, I didn't know I wasn't 100% convinced I wanted to start my own fund. So, I had conversations with some tier one funds about being a GP. Um, and for various reasons, I was like, I don't like the culture there. I don't like the structure here. I don't like this. And you know, in thinking about what we did with Superhum and the the type of company we built, it's like, I want to invest in those companies. I want to invest in companies within the enterprise AI productivity dev tools space. I love the zero to one. Um I started getting restless at superhuman at scale and I found it to be you know a little bit boring and that's just a function of I'm a zero to one person. I'm not a I'm not a one to end type person and I knew that about myself and so folks have asked why I start another company. It's like I'm planning on incubating a few companies and I'll I'll incubate one company in in the first fund. Um, but you know, I'm I I I got very My wife saw this. She was like, "I see you get a lot more energy from investing than you do from kind of being a full-time founder." I'm like, "Yeah, I just think it's the best job in the world. It's intellectually stimulating. It keeps me young. Um I like just going deep with a founder and you know if there's any value ad that I've created for them that's just so fulfilling but also learning about it. There's so many times where I'll I'll go I'll have dinner with my wife. I'm like yeah I just I spoke with this founder an hour ago and just kind of going deep on this. Did you know this problem existed for this? And like we would we would talk about it. She's an XVC herself. And so um so supercharge is a first check preed fund investing in enterprise AI productivity dev tools. Um it's really investing in products and companies that supercharge professionals and their team. So I don't touch consumer um I'm exclusively focused on the enterprise um space. And so I've done I've invested in eight companies out of the fund, made one follow-on investment from one of those original investments. Um it's a $15 million fund. Uh, I'm actually doing Final Close next month. Um, so I'm at the tail end of my fund raise, but >> yeah, it's a solo GP outfit. Um, and I'm doing this for the next 40 years.
Amazing. Yeah, I think I think it's, you know, we're fortunate to be doing what we do. It's just it's awesome.
It's great. Yeah, I love it, man. I always learn so much when we get a chance to sit down. I feel like I always pick up interesting insights and wisdom. I'm sure our listeners uh feel the same way and I just want to thank you for being here and spending the time with us investing in founders, giving them all your advice um and spending time with the Antler founders as well.
Um so thank you very much. Yeah, thank you for having me. This has been Further Faster. I'm Jeff Becker, the general partner here at Antler in New York City. Glad we had VCORA on the podcast today. I hope you enjoyed this episode. If you did, make sure you like, subscribe, and share so we can bring on more great operators, more great investors to share more great insights with all of you. [Music]