Bret Taylor’s Journey Leading Salesforce, Sierra & OpenAI

You are one of the least known, most impressive people in the valley. You rewrote Google Maps in a weekend because you thought it sucked. I love to work. Best way to predict the future is to invent it. And that is like my operating principle. I am extremely passionate about Sierra. I think we'll probably see the first trillion-dollar software-as-a-service company come out of this era. The reason for it is that these AI agents actually are doing jobs rather than just adding productivity enhancement. And I think that value is so quantifiable. After I left Salesforce, by coincidence, Chat GPT came out right then. I would be building open-source software if not running a company right now. I just want to work in the technology and help shape it because it's the most exciting technology of my memory and I want to play a part in shaping how we all use it.

[Music] Welcome to Grit. I'm Juven, partner at Kleiner Perkins, a show where we go beyond the highlight reel and explore the personal and professional challenges of building history-making companies. Today on Grit, we have Brett Taylor, co-founder of Sierra, an AI-native startup reimagining how businesses connect with customers. However, Brett is probably one of the most illustrious and underknown guests that I have ever had. He started Friend and sold that to Facebook. Within a few weeks, he became the CTO of Facebook. He was the chair of Twitter during all of the drama. He then started another company that got acquired by Salesforce. Within a few years, he became the co-CEO of Salesforce with Beni off. And now he's back to ground zero, starting another company. We talk about why he made the leap back to early-stage startups, what it means to be in the eye of the AI hurricane, and what he's learned from a career at the center of it all. Enjoy the episode.

It's interesting because you have a real way of timing these boards, like, uh, I'm curious. Um, you were on the you were on the board and the chair of OpenAI when it's all happening, like Sam's getting—we don't even know. I still don't actually know what's happening.

Well, I wasn't there when I was brought in to to mediate to mediate.

Yeah. Yeah. So, for better or worse, you know, uh, and then all of the stuff that happens with Twitter, when you like go home, like when you like go when you like put your laptop down and you go home that night for dinner, do you ask yourself how the hell did a kid from the East Bay, still lives in the East Bay, get caught up in this stuff? Like, it is crazy.

You know, part of it is like the OpenAI thing was a choice, cuz like it was in crisis and I agreed to come in and help—Yeah—put Humpty Dumpty back together again. So, that one was my—I just cared a lot about OpenAI. It was interesting. I was never going to do a board again. And my wife was like, "Are you really going to regret helping OpenAI from collapsing, you know, on your deathbed?" And I was like, "Whose side are you on, honey?" you know, so that's uh—part of it is just like life is complicated and like to do impactful things, you can't run away from complexity. So, you know, you just got to put on your big boy pants and like make hard decisions and like compartmentalize. So, yeah.

Do you get a call from somebody that's like, hey, like this, you said Humpty Dumpty—putting Humpty Dumpty back together, which is a funny funny phrasing for it—like this is happening and you have to be like—if somebody calls me with that, the first question that I would ask, not being you, is like why me? Like why are you calling me to put this thing back together? Is that how you reacted?

Uh, I had an intuition why they called me. I mean, I the, you know, I think there's like a running joke that I'm like the board fixer, you know, uh, I'm not sure it's a reputation I sought out, but it's a reputation I have. I had actually uh chatted in the past with Sam and um a couple members of the board about maybe joining the board and I and I said no because I just wanted to focus on Sierra, my startup, and uh and I and I wasn't really sure I wanted to spend a lot of time on boards, you know, in general, and then when uh that Thursday or Friday when when Sam got fired, I ended up getting a call uh actually from one of the the the board members saying essentially relaying that, you know, they're going to try to figure out a a path forward and would I be willing to help. Uh so then I called up Sam and you know and you knew Sam. I knew Sam. I knew I knew Adam D'Angelo, like he was also a CTO of Facebook. I knew Kora. Um uh so I called Sam and basically wanted sort of his side of the story because I knew it was a messy situation and I and I just knew if I were was going to put myself in the middle of it, I wanted to know what I was getting into. Um and both the uh board and Sam reflected like, "Yeah, we'd like you to help." Uh which was interesting just cuz it was obviously a complicated situation. And I was just reflecting like I'm not sure there was a long list of people that both Sam and the the board probably could mutually agree upon to to help. And so it felt uh I don't know if this is true. Like if I had said no, what would have happened? I don't know. But I was a little bit anxious that if I said no, there wasn't going to be a person that could come in and help try to mediate a solution there. And you know, if you talk to any entrepreneur who's making an AI startup now, none of us would be in this position if not for OpenAI. I think uh I'm sure like the scaling that OpenAI did after the Transformers paper, someone might have done it, but Chat GPT caught the consciousness of the world and and sort of created the the moment we're in now. And so for me, I was just like, gosh, if I can play a part in helping this uh quirky nonprofit research lab that somehow captured the attention of the world and I can help it not collapse, that's a pretty good use of my time. And so I just decided that I was like, you know, I I was in a unique position of being at least somewhat trusted. I don't want to speak on behalf of everyone involved, but at least, you know, considered a high-integrity person who could help figure it out. And I was worried. I mean, you know, that weekend there's that letter from employees, like the vast majority of them saying they're all they're gonna quit, right, if he if he left. Yeah. And it was just sort of like, man, this thing was about to collapse. I mean, I don't know. It's hard to you can't AB test your life decisions, right? So, you know, maybe it wouldn't have maybe, but it sort of felt like as an outsider that it was going to collapse, and I didn't want it to. Um, I thought this was one of the most remarkable organizations of all time. Who would have thought five years ago that you know large-scale AI would come out of an independent research lab, not one of the large incumbents, right? No one no one would have predicted that except maybe Sam and Greg and the OpenAI team, and I just wanted to play a part in in helping it exist, and so that's why I did it.

Yeah. And when you were thinking about help, was your idea of help getting Sam back in the business when you were entering or did you not exactly know like was saving the company getting Sam back in in your mind at that point?

At that point, um, my view because I was like just reading what everyone else was reading. I had the same information you had. uh at that point uh the employees at least from that letter had indicated like we don't understand what happened and you know we demand a reset, effectively that's how I read it, and to move forward, so when when Larry Summers and I uh sort of reconstituted the board with Adam D'Angelo, we started by just basically saying let's do a reset, Sam comes back, and then we'll do a review and and uh do something I would a a fairly uh independent review of what happened and then decide in a way that hopefully would people would broadly interpret as like proper due process. Um, and so I went in intentionally with an open mind, not saying like this is what happened or this is what didn't happen cuz I didn't know and no one knew, but I wanted to reset it and then have uh something like when Larry and I sort of did that review, we wanted proper due process. So whatever decision that we came to based on collecting the facts, you know, OpenAI and its stakeholders, which is basically the world, would be like, hey, I might not agree with every decision, but you you did the process with integrity, and that's what we tried to do.

And at the time, you're coming off the heels of all of the stuff that had just happened with Twitter and Elon. And then you're doing your own startup, right? Like, uh, this is in the middle of you building a brand new startup.

Yeah. Off of the ground. Like those are all happening basically in parallel if not close sequence. Is that right?

Yeah. I uh crazy. I was, you know, in September of the previous year, I was co-CEO of Salesforce and chairman of Twitter. And then you fast forward, you know, uh like a little over a year and and this was happening and I had started my own company and now this happened. So yeah, it's like a lot a lot in time, a lot of these things happen in in quick succession.

This is maybe a naive question, but does do you feel the feeling of overwhelmed? Like does that do you even experience overwhelmed internally?

Uh, I'm sure I do, but I've I'm good in a foxhole, you know, like I don't freak out. Uh I—So what I always try to do is and I'm not always perfect at it, by the way. What I try to do is basically take a breath, take a step back, analyze a situation and say like what's the most important thing I can do right now. Uh and you always try to think about the long term and the short term. And in general, you know, I I do feel overwhelmed. I do feel anxious, but I don't feel them as overwhelming emotions. You know, I I try to channel those emotions into to taking action. Um, and I think we're capable I think people in general are capable of a lot, you know, and and sometimes we uh whether it's imposter syndrome or just like emotions cuz you know sucks to have bad things happen and you can let those emotions overwhelm you and and cloud your judgment. I think it's like exercise, like the more you're in complex situations the more when you're presented with one you can kind of dispassionately—maybe is like overstating it—but as dispassionately as possible figure out okay what am I going to do? Um and you know I've just had the I don't know it's good fortune but I've been in a lot of complex situations in my career. So, like the more I am, the more I'm not like underwater and overwhelmed when something like that happens, you know, the more you can react to it as, hey, you know, like we'll get through this. Like, we just need to figure out a path from point A to point B. Um, so yeah, I don't want to pretend I'm like, you know, uh, immune to emotions or something like that. But I I've, you know, my experiences have developed the calluses that you you need to deal with these complex situations and not freak out.

Yeah, I think it's totally fair. I mean, I just the reason I ask is cuz like if you did like I can't imagine a series of things that would evoke the emotion of overwhelmed more than the sequence of things that you have gone through over the last couple of years.

Yeah, there's a lot that goes on, but you know, you cultivate advisors, good friends. Like I'm so grateful for Larry Summers who, you know, uh we were, you know, I cajoled uh you know to join the board with me when when and you know, he's been just an amazing partner. And so when you're like really unsure about a decision, who do you call? You know, and you need those people and you need the right people because if you're dealing with something quite sensitive and confidential, you can't just call anybody, right? So how you surround yourselves with with people to make you confident and you know and give you confidence in in complex and nuanced decisions is a big part of it. Having a good support network and family is a big part of it. Um but you know people are capable. I mean I I I love reading history and you just you know read about the greatest generation and serving in World War II and you're like I don't know if I could do that. Well, turns out all those citizen soldiers none of them contemplated that situation. and they got put into it and you know many did incredibly heroic things and you know uh you look at all the founders who end up CEOs of these huge companies and you know I've seen so many people like you know Mark Zuckerberg sort of grow up from where they started to where they are today. I'm like, "Yeah, you can do it." You know, I I think it's like you can feel overwhelmed, you can do all these things, but yeah. No, like I think with the right mentorship, the right mindset, um I think we're capable of a lot as people. And uh and I I certainly try to like remind myself of that in those moments of insecurity just cuz I have unending confidence in in humanity and just like the the greatness of individuals and put in a in a complex situation when you are in the eye of the hurricane if you will.

Let's say like you are negotiating Sam to come back and you go home that night. Do you when you're in when you're all the way in is your tendency to work until you come out of it or do you have the ability to be like okay here's this thing I've left it all out on the field for tonight thing goes over here like I can cook for my family or whatever or is it is that just not possible?

Uh, I try to do it and it really depends on the thing. Um, let's take this thing OpenAI. I try to compartmentalize because I do think, you know, uh, I wouldn't say I'm like a balanced person, but I care a lot about my family and I care a lot about my my career and and and I don't do a lot of other things. And so, you know, when I'm with my family, I try to be with my family. I think the uh the more personal something feels, the harder it is. And I think this is why, you know, the title of this shows Grit, right? Like the reason it's hard to be a founder is it's not just a business, you know? It's not and I think the the level of when someone says something bad about a product that you made that like your name is effectively on the door, you take it really personally like every every founder does. And so I think when uh something involves sort of I'll say these existential issues that impact your identity, not just like the job that you're doing, it's harder. And so that's something that I think every founder that I know deals with in some capacity. Like how do you are you at dinner and like staring off into the void and like not really being present? And I I've been that person and every founder I know has been that person. And so you develop techniques to do it because I do think that you know human psychology is complicated. But I I find for example if something's worrying me the last thing to do is to try to avoid it because you'll that that anxiety will creep in. So you need to like address it and then you can set it aside. So I develop techniques like it but I'm not perfect. I mean like I I'll go home and have the family dinner. Like am I as present as I would hope I am? No. I mean probably not. Um and then the more personal it is the harder it is. But it's uh but I do think as I said you know as as you the first time you've encountered a situation like let's say you're an entrepreneur and you have to terminate someone for the first time that's really hard you know as you've you've been in a career as long as I have as long as I have and you've done that a number of times it's hard but it's not you won't necessarily take it home with you in the same way because you've seen those people thrive in other parts of their career you realize it's not the end of the world you realize hey if I do this respectfully this is just a hard conversation that everyone's going to get through. But you don't have that perspective the first time, you know, and so just as you develop the the battle scars, you know, of of navigating complex situations, it helps being able to put it in a compartment and have that family dinner and, you know, show up as a as a good father and a good husband.

So, can I linger on the OpenAI thing for one more second, which is like um you started and sold uh a company to at the time was Facebook. Then you started another company and then sold it to Salesforce. Became the CTO of Facebook and then the co-CEO of of Salesforce. Um one was call it kind of the social and mobile era of the world. The second uh was basically the godfather of SaaS, right? And and cloud with Salesforce. As you think about this moment now, contextualizing all the moments that you've seen leading up to this point, how do you think about it?

I think this feels to me like the birth of the internet and the .com bubble. I was at Stanford during the dotcom bubble. So my undergrad was 98 to 02. So 98 was like the peak of the frothiness and then 02 the bubble had burst. So it was really interesting to be there through that because uh you know my freshman and sophomore year you'd go into the computer lab and it was like pizza stocked by a startup and it was everything's high-flying and by the end of it I don't there wasn't literal tumbleweed going through the job fair but it sort of felt like it and uh yeah someone asked me like how did you choose Google? I'm like, well, they were like one of the three companies hiring still by the time I graduated, you know, and uh and so uh the reason I think it is is I—

And you went—sorry, you went straight to Google, right?

From out of my master's degree. So I—

And then you joined Marissa Mayer's APM program.

Yeah, that's right. Also former guest of the show, which is a gem. That's great. Yeah. So the reason why for me it feels like the internet is I remember in 1996 97 everyone who thought about the internet saw its impact you know whether you called it antiquated terms like information superhighway you know everyone sort of thinking about you pull the thread of the connecting the world through the web and you say okay commerce is going to happen over this technology. Oh, and uh web search is probably an important concept because as the number of websites proliferates like how do you navigate it? And it was even obvious in the early days of portals that that directory was probably going to you know uh not scale with the scale of the internet. And then you had uh you know things like okay we should be able to do payments you know over the internet and that was like a obvious idea that was hard to execute you know which and and PayPal emerged as sort of the winner there and Google emerged relative to Alta Vista and all the web and ink to me as the winner in search um and you know portals which you know didn't end up quite as important but they're still around you know like Yahoo ended up uh dominant over things like Excite and and MSN and all that. So the reason I think it's there's a it's a reasonable analogy to the situation we're in now is if you look at the capabilities afforded by large language models um the areas of the economy that should be impacted aren't are largely shared. You know it's like okay software engineering is definitely going to change with the code-generating agents. Customer service, which is where Sierra Sierra's business is, is almost certainly going to change because of

This technology. Oh, probably content marketing's in there. Oh, and the paralegal profession or the legal profession broadly. And you start going through that and in a group of smart people who's, you know, deep on the technology. None of those are controversial ideas. But then the question is like, how do you actually build a great product and a platform to actually solve that problem in the most, in the best way?

You know what PageRank was to web search? The idea of search was not novel. The idea of PageRank was. And then similarly, like what's the right business model? Inktomi had a B2B business model in search. Google had a B2C. It turned out the latter was uh much, much more uh impactful thanks to AdWords and things like that. And then execution, you know, like you have the, when you have a category like, I, I didn't follow the Amazon-buy.com rivalry, but Amazon's just famously great at execution, you know, and all those things add up.

So, it's, it feels like these markets are obvious and are going to be very competitive. Like, what is the right product for these markets? What's the right team to address them? What's the right distribution channels and go-to-market model? And I think, you know, Victors write the history books, right? So, you know, at the other end of this, you know, we only talk about Google now as a verb for search, but when I, you know, in 2002, maybe, probably then it might have been sort of obvious, but barely. You know, you go back far enough and it wasn't obvious.

And so, that's what's exciting about it to me is the market opportunity is, is large and obvious. Uh, and I think unlike the internet, you know, we had to wait for the world to be connected first through modems and then through broadband, most AI solutions uh can be distributed on the infrastructure we've already built over the internet, over the web browser, over the mobile app stores. So, as a consequence, I think the adoption of, of this wave of technology will be even more rapid, but it's going to be really competitive. And I think that's uh, it reminds me of the dot-com bubble in that way. Um, where, you know, in retrospect it seems obvious that Google was going to win, but there was a lot of like sweat and execution that got them to that point.

Obvious and competitive tend to go hand in hand right now where like uh, you mentioned a few of the obvious spaces: coding, legal, customer support, where these frontier models are very clearly going to supercharge the next wave. There's like seven companies, legitimate companies in each of these, and you know, I wonder what your perspective is on if they're so obvious and so competitive, but they are like, like let's just take Harvey in legal, right? It's obviously a great use case to take this structured text and summarize it, and you have expensive paralegals that probably shouldn't be that expensive. Like that makes a lot of sense. You, oh. Uh, same thing with customer support. Like it's a very crappy experience. It's a delay almost always. It's multimodal across phone and text. Less of a question, more of an observation that I'd be curious to get your reaction to.

Yeah, I mean there are examples of nonobvious ideas that turned up, turned into really big companies. Like you could argue Facebook was one, and, and, and Twitter, now Airbnb, Coinbase. Yeah. And you know, where you're really inventing something new. Um, more often than not though, the really, really large companies, if you look at like the top, you know, five tech companies in the stock market that dominate the S&P 500, it was, you know, making an operating system and the core productivity suite for the early PCs. It was in Apple's case making the PC, and then, you know, the, well iPhone was a very novel product. The mobile phone market was established. So it was a uh, and, and then you look at web search, which was, I put squarely in the category of obvious idea in the internet. I mean, it really was. It was a billion, there's like 20 companies, there's like 20 companies doing it, and uh, Amazon, we should buy things online, like, of course, the idea to start with books was a really savvy, but it was uh, so you know, I think there's a loose, but uh, but I think uh, correlation between total addressable market and obviousness um, I think is the big thing. And so uh, while there are some really important companies that started with just like, oh wow, this is a great idea, like wow, I wouldn't have thought of that, most of the largest companies in the world are doing something that is very important and very mainstream and very widely used, like calling customer support, and as a consequence, everyone's staring at that market as everyone should be. This is what capitalism is, so it will drive down costs uh and make companies with better products, better execution succeed, and, and that competition's uh, you know, as much as I would love to be the only company in the space. It drives, it's why capitalism is amazing, right? Like I'm paranoid as all of our competitors. We're, we're like, we respect some products. We respect some go-to-market teams. Everyone's got different strengths, and you're sitting there every day grappling with that reality. And uh, but I think it's because the market is, is huge, and I think that uh, no company has the privilege of addressing a market that gigantic as an individual company, and the market just wouldn't enable that, right? Um, and uh, but I think the reason why it's worth the stress of that kind of intense competition is, you know, I think we'll probably see the first trillion-dollar software-as-a-service company come out of this era. Um, you know, we, and a pure play, you know, like not, not building infrastructure and things like that, and I, I think the reason for it is that these AI agents actually are doing jobs rather than just adding, you know, productivity enhancements on someone else doing the job, and I think that value is so quantifiable and so real that uh, people will pay a lot more for it than you will a productivity enhancement.

Um, and I think similarly, I always gave this example, but the legal tech market I think was notoriously bad before Harvey. It wasn't, I can't think of one really, really large legal tech company, and, but it's an important profession, don't get me wrong. It's just the addressable market of selling productivity software to lawyers. It's just a relatively small number of firms, relatively small number of seats. You just do the math in a spreadsheet. It's just like, yeah, you can make a decent company, but you're not going to make a Google out of that. But then you look at the amount the world spends on legal advice and like uh uh doing contracts for your supply chain or doing antitrust review or all these like, you know, long tail of things that are, are quite valuable, and all of a sudden that market that looked modest looks gigantic. And so the interesting about these agents is I think it's changed the total addressable market of software because you're essentially getting into labor markets and things that used to be backwaters of software all of a sudden like really interesting software markets. Uh, I think that's really exciting. So I think we're going to see some really important companies come out of this era in the same way we did in the birth of the internet. Yeah.

On the, can I keep pulling on this Google analogy that you're using, which is like, um, obviously we have a history with Google. Um, John Doerr also did a bunch of the other companies that maybe weren't the preeminent ones and then got Google and Amazon right. But Google in this example was not the first search engine. Wasn't the, it wasn't even like the sixth. I was going to say I don't think it was even the top 10.

Yeah. It was like maybe 15th or 20th search engine. So like, again, let's pull that forward. It's maybe history doesn't repeat, but it rhymes. Yeah. Loosely here. I don't know. But like all of these companies that we're talking about, let's take Harvey in legal or Sierra in, in, in customer support. Um, Cursor and Windscribe in coding, right? There's like a few categories that we're talking about here. Um, maybe Glean and search, right? It's like kind of like there's like the mother of all the markets today. They're first. You're first. Um, do you uh, do you think about it differently in what it means to be first in these markets today versus somebody waiting in the wings, waiting for the models, maybe a different breakthrough? Yeah. How do you think about that?

Let me go back to the Google analogy for a second and then answer the question because I think the nuance matters here. I think there's a narrative that is not completely untrue that Google won because PageRank was better. You know, a lot of search engines were reductively based on analyzing the content of the web page, which made it really prone to spam and made it really hard to figure out which of these web pages talking about this topic was actually canonical. PageRank and, and looking at links and basically sort of anchor links between web pages. Had a uh, essentially a notion of reputation and importance and credibility in addition to analyzing content, and the combination of those two made uh, just made it work. You know, like you could search for something and, and be relatively likely to hit in the top results something that actually was what you were looking for. So, it's a really important technical insight. And I think some people say, "Okay, that was Google won because of PageRank." Yeah. Well, there's a couple other things like Google also signed deals with all of the major portals around the world. Google powered search on Yahoo for a really long time, and you went around almost every country in every market, you know. So, essentially Google distributed search engine and sort of like, you know, uh, basically got distribution uh through a really effective partnership structure. Had they not, that would have opened the market to a lot of other competitors like Inktomi, who ended up acquired by Yahoo to go into that market. Secondly, you know, with the, when I got to Google, I don't believe AdWords existed, but there was banner ads at the top. You could like buy a keyword is my recollection. I might be embellishing history here. And then going to not only um, cost-per-click based ads, but the way AdWords ranked it, which was proportional to the click-through rate too, which incentivized high-quality ads in addition to uh, you know, optimizing for sort of an auction so people could bid on those keywords created one of the greatest business models of all time. It was essentially like mapping the demand of uh, you know, intent on the internet to the supply of people who could fulfill that intent in a very efficient auction. And so then you look at the Inktomies of the world that were licensing their technology to portals, and you realize at that point you, you know, the Google's business model was just better. It was just generating cash like it's going out of style, and you just couldn't reproduce that in a, in a B2B context. So you have the partnership strategy, you have the business model which was really important. If Google's business model had remained selling that yellow enterprise search appliance, it would not be the company it is today. It wouldn't have been able to finance things like Google Maps that I worked on because you wouldn't have had a business model to support that. All of it's important: business model, distribution strategy, uh Google's costs were much lower than a lot of competitors, you know, because we built our own data centers, and really the cost to serve was like meaningfully lower. All those things mean you can just do different things with your technology or product.

Okay, so now let's go to the AI market. Um, how you price matters. Um, are you uh charging based on consumption? Are you charging for outcomes? Are you charging just a site license to use the product? That matters a lot. Um, and because, you know, uh my intuition and the reason why Sierra does outcomes-based pricing is outcomes are valuable. You know, people know the value of an outcome. Uh, if you end up charging proportional to technology, you're probably going to end up marginally uh, just you'll have a thin margin on top of the price of AI, which is going down rapidly, like even as we speak. Similarly, what is your cost to serve? Um, you know, I think that, uh, there was a lot of companies that, uh, you know, created, you know, two and a half years ago where they went into places like Kleiner and said, "We have all these great AI researchers. We're going to train our own models cuz we're really smart." Well, it turns out that spending, you know, tens of millions of dollars to train your own model when the foundation model market is sort of commoditizing turns out to be a really unintelligent use of capital, at least in the applied AI market. Most of those companies have been consolidated. Now at this point, uh, you know, you just can't have the business model of a pharmaceutical company where you spend all of your capital and like license it out, um, and so you know, and then similarly like what is your go-to-market model? Is it product-led growth? Is it a developer motion like Cursor? Um, is it an enterprise software motion like Sierra? That also impacts your cost to book, it impacts what customer, what parts of the market you're able to address, um, and it also impacts things like attrition when new people come around. You know, the reason why Google was able to overtake AltaVista was you just visit a new URL. It's really easy. Um, that's always been Google's argument, you know, uh, for when people say they, they have a monopoly. It's just go to a different search engine. They're not completely wrong on that, right? Um, and you know, in contrast, you know, if you look at say a large ERP deployment, you're, you know, it's hard to rip out an ERP system. Every large company in the world has had these like multi-year ERP system replacements, and that's an example of like a market that's like slow to address but very low attrition when you address it. So I think all these things matter. So I don't think like a first-mover advantage on its own is a sustainable advantage, and in fact, if you look at the dot-com era, it wasn't always, maybe even less likely if you're the first mover, but I don't think it's, it's causal necessarily. I think that uh, what really matters is like what is your sustainable sort of like technology point of view and advantage, what is your go-to-market model, how, how do you manage your customer relationships, what is your business model, you know, I think like a pricing model, and I think all of these things matter. The fun part about new technology is, you know, we didn't have cost-per-click ads in the early days of the internet, and now it's pervasive. Now we, you can even do conversion-based ads and things like, I think the exploration going on in the industry on like our approach to outcomes-based pricing is really novel. It's new. I think it's a really good idea. We, we'll talk in 10 years and I'll tell you whether it was actually a good idea. I don't think it's going to take that long, though. I think we'll find out soon. And uh, I, I outcome-based pricing meaning uh, we charge when our agents autonomously resolve the problem, and it's free otherwise. Um, and we do that so that our, at Sierra, our business model is aligned to your outcomes. Um, it's very new and, and it's very much like the difference between impression-based ads and cost-per-click ads. Um, these are things that excite me right now is I think we're going to find some key conceptual ideas that are hard for uh incumbents to copy, maybe give you a different angle than your competitors. And I think just like you can, the narrative I had around Google which is probably at least half right, you know, on why they succeeded, um, with the benefit of hindsight we'll know which of those key insights were actually like the meaningful ingredients to, to winning in these really big markets.

Yeah, it, it is interesting to see it play out like you're riding on the wave of the frontier models, right? And so you have OpenAI and xAI and all of them, right? They're all pushing, and we were having this conversation. And I was having it with um, one of my partners, Ev, yesterday. He was like, you know, I don't really use Perplexity anymore, and I used to live in it. And he was like, everything is now just in ChatGPT, you know, like they were first. And it turns out like all of the things that people thought you were going to build on top of ChatGPT is just going to build in many ways. And now that they have memory, a founder that I was with in New York last week was like, I think this is going to be the stickiest piece of software like ever, ever. If that all plays out, you know, it's right now consensus is all of a sudden in the Valley that OpenAI is going to, is a runaway train because they have all of these first-mover advantages. I don't know. We'll see. Super interesting.

Well, you know, if uh OpenAI is synonymous with AI for most, most of the world, you know, it's the Kleenex of the facial tissue market, you know, and, and you combine that with what, you know, obviously I'm totally biased, but I think by far the best models and by far the best product in ChatGPT built on top of it with memory, web search, deep research is a mind-blowingly great product. I don't know if you use it much, but just, just amazing. It's like having a full-time intern working for me. Uh, it's, it's just amazing. Deep research plus memory. Yeah. That's the like killer combo for me. Yeah. Was like, "Oh my gosh." Like you can go do all of this reasoning work, and it's coupled with all of my personalized, contextualized history. Yeah. Yeah. It's like magic. It's amazing. And uh, yeah, I think broadly I, I do think ChatGPT will be the enduring consumer brand from the AI era. There might be more. Um, in general, like when like a couple years ago, someone asked me about how I thought the ad market would play out, I think I still have the same opinion, which is I think there'll probably be one, you know, trillion-dollar consumer brand coming out of it and like 10 or so uh enterprise software companies um that are less valuable but extremely valuable. You know, just, you can't quite consumer scale just, just produces so much value. And I think I think ChatGPT is that brand. I mean, it, it doesn't mean there can't be more than one. It's just uh, consumer is harder than than enterprise, and it's much more of a uh winner-take-all market, not just because of market dynamics, before the dynamic of like the Kleenex facial tissue thing. Like ChatGPT is synonymous with AI, and then if it's a great product like I think it is, people come back to it. Um, and I have the same experience. Like I, I always try to use everything just cuz I'm so curious about this. But for me, I just always go back to ChatGPT cuz it does, it's just such an effective product, and it's amazing. I mean, it's amazing. I love learning things with it. I love using it as a creative foil. Uh, it's, it's a product that has so changed the way I live. I just, it reminds me of Google in that respect. Like I just couldn't imagine the internet before it, and I used it 100 times a day, and I still use Google. But I think ChatGPT is like the most impactful technology product for me of like the past two decades easily.

Yeah, I agree. And if it plays out like the Google world, then yeah, there'll probably be one trillion-dollar company. If you had to give up your smartphone or give up using ChatGPT and all of its competitors, like using an AI system, which would you give up?

Post-memory, it has become a very difficult question because, let me put it this way, every day that I spend more time in these systems, let's take, let's take OpenAI as the system that I spend the most time in, every day I get convinced that I've never seen anything like this. Yeah. By the way, you know, we talk about AGI and what's the meaning of it? If you talk to anyone four years ago and you ask them to describe AGI, it's, we're probably beyond what people, that's why I don't like any of these labels of like agents and AGI because I'm like, you even this agentic thing. It's like there's already a lot of work being done on our behalf, you know, like what's the, where do we, where do we superimpose a line of full autonomy, you know? I don't know. It's like, or when does autonomous for cars? It's like, it's like

Are we splitting hairs here? Um, but yeah, I think like, uh, I've never experienced um I've never experienced anything like this. Yeah.

Where the more that I use it, the more that I'm like, "Oh my gosh, it did that." But then there's also things where I'm like, it's re-like I will refresh questions with different models and then I will re-ask the same question and get a different answer. Like there's something fundamentally that I'm not habituated to of how I interact with this thing. Does that make sense? Like there's just something this also feels I always give Sam and Tim so much [ __ ] for like the naming. It's like, you know, get rid of models like the menu of models at the top. It's comically uh comically bad. But it it is I actually I actually like it right now because the technology is immature. Ideally, you should just be able to go say something. It does the right thing, chooses the right model for the right task.

I like the fact that it's not just you and me. I I'll talk to family members outside of tech and they're they're using these things. They have opinions on them. They're like, "Ah, I tried out 03 and it's here's what I learned about it." I think we're all understanding the contours of of these technologies. I remember growing up uh and I I wasn't into computer programming until uh later in high school and but I knew like the graphics card in my computer and I knew what games could power it and I you know understand like if I wanted to do this thing like I got I understood like more of the architecture of my computer than I do the architecture of this phone because you kind of needed to to like be like to use a PC back then. Like it's like in the same way in the early days of the automobile like most people knew how to like be a mechanic basically cuz it would often break down to the side of the road.

It's clear that like the uh it'll feel like a vestige of the past that the menu of models is like with 100% certainty that's not going to be something we experience 5 years from now. But I also like the fact that like we as users of this technology can kind of experience the contours of it and see the chain of thought reasoning and be like that's interesting. That's kind of gives you kind of an intuition how it works.

I'll give you one really kind of it's going to sound like a not really related thing, but I think it's related. One of the things when Clay and I started Sierra, we were saying the first time an AI agent that is performing customer service on behalf of one of our customers hallucinate something, how are they going to react? Are they going to expect that the technology is perfect 100% of the time? Because no matter how good, and we're really proud of our guardrails and knock on wood, haven't had a social media moment with our platform yet. It's still a nondeterministic technology. Like you can't promise that it'll never do something wrong. Even by the time our first agent launched, ChatGPT had become so popular that everybody in the executive team at every company you work with had experienced hallucinations. Like they there was the the famous like lawyer who made up the case law and the I think it was Air Canada that like made up a bereavement policy. And so when we were explaining the risks of these technologies, they're like, "Oh yeah, I get it." It's almost like explaining that occasionally your phone freezes and you need to restart it. And I was like, "Wow, in like six months of this technology existing, everybody in the executive team of all these mainstream brands understands like the nuances of its idiosyncrasies and what could go wrong."

I think that's great because as society grapples with the impact of AI, for example, what level of decision making and agency should we forward in AI um around customer service? That might be a simple question. What about making a financial decision? What about making a decision in something related to national security? You almost need the accumulation of all of this like intuitive understanding of the contours of the technology that isn't just relegated to the technology industry but actually society at large so that we can have a conversation about the collective risks. I always like to say like the main reason GPT-8 will be safe is because GPT 1 through 7 were safe through responsible iterative deployment and we as a society grapple with the impact. Right now it's things like hallucination but there's things like uh how sociopathic should the could the models be like when does that cross a line of inappropriate uh jailbreaking all those things. There's so many nuances we need to grapple with as a society when you apply this to like real world situations that I think it's it's great that you have that silly drop down selector. So you can actually get a sense of like why are these models different from each other? How does it form change my opinion of this technology and I think that will actually accumulate to better societal decision-making over time.

It reminds me a lot of like I grew up in the cloud security industry. My operating career was when AWS was basically serving Capital One and a few other companies like Airbnb and a couple tech companies. And I remember the transition happened over maybe 2 years where the overwhelmingly obvious value that came from the public cloud was so much more dominant than all of the headlines around S3 buckets. Like it this it reminds me so much of someone leaves an S3 bucket open to the internet and then they find all sorts of unencrypted data in there. Yeah. And there was headline after headline. The DNC in 2016 got hacked with an S3 bucket. It was like one after another. And we like grappled with that as an industry, but it didn't slow down the inevitable at all. like it was this wave was coming and that took two years and this just feels to your point like six it's like 4x more compressed of a timeline than the previous than the previous version. It's kind of a weird analogy. No, but it's the same and it's like it's just interesting. I think it's such a compelling technology that everyone's like diving into the deep end and understanding it and almost more receptive to its imperfections than I would have imagined cuz think about it like computers since you and I started were really fast rules engines basically with with storage attached you know and if you look at the entire software engineering industry it's how many nines of reliability can you get and the software development life cycle and the testing methodology it was designed to things more reliable, more predictable. And there's I mean the idea that the same input could produce different outputs and that's the way the system was designed is like so foreign to those of us who grew up in this industry and we've now absorbed these new technologies so quickly and I think it's fun. I think it's interesting as you said I think people have really understood the imperfections and I think it's important that ChatGPT exists so that like everyone in the world has had it say something silly and obviously wrong and be like huh so this super it's like super intelligent in some ways and totally idiotic in others totally and that's and it's like I it's like that's an important intuition for for all of us to have when you're using this technology yeah it's um also why things are so competitive in the market right because it's like, you know, if you went off on an island and spent a week in one of these tools, very quickly, I think you'll come to the same conclusion that we come to, which is somehow this might be still underhyped and underrated after you spend literally a week in it.

I agree. I mean it's to me I I might have borrowed this from from a talk but I can't remember which one but you know we're basically going from making something scarce and making it abundant. We did it with power. Uh we did it with transportation. We did it with uh food at least in in most parts of the world. Um and now we're doing it with intelligence. And I think that if you look at the impact of like electrifying uh the world, you look at the impact of uh you know making fruit production the way it is now, like what percentage of society worked in agriculture 300 years ago versus today or 200 years ago versus today. it and then you know I just think we haven't actually absorbed how impactful that will be and I think it's I think it'll be uh largely great uh there's definitely going to be some as with all technologies downsides but how amazing is that and it's hard for me to imagine a world where I can't you know go to the supermarket and get get the food I want just like it's hard to imagine to go into a room and not be able to just flip on a light switch to have the lights go on I think you know uh tens of years from now uh it will be hard for people younger than us to imagine a world where intelligence is not abundant. And I think that's like a really kind of mind-blowing thing to think about.

Um can you tell me about the three martini lunch experiment that you did at at FriendFeed? How did you learn about this? That went deep in the archives. So, oh my god, Paul Vuhay can maybe correct me, but so um we were 12 people at FriendFeed, very tight-knit and we ate lunch together every day and that it was right when Mad Men was really popular and if you remember that show they just drank like fishes so like it was just like and so we you couldn't help but talk about it just because they're in the office and and we got in a debate we went to there's this Mexican restaurant kind of near we had rented this like kind of cavernous warehouse uh in Mountain View near the Caltrain station and went to our favorite Mexican restaurant we had this relatively heated debate like there's no way like you Paul could like drink three martinis and do anything after lunch and like I can't remember whether it was Casey or Anna or me but like we were like oh I bet I could. So there's only one way to settle that bet. So we went first uh in this day and age it's hard to find a place that serves martinis at lunch. We found a steakhouse in Mountain View. We went I don't think most people made it through more than two martinis. I'm proud to say I did all three. And then we went back and tried to see who could commit code. Uh, which is not I wouldn't endorse this for future generations. Um, I did I did get a commit in. Um, I was sleeping on the couch later, but Oh my gosh. Casey uh won the bet though, but I can't remember the conditions of the challenge. Um, so uh I can't believe you knew about this. Uh, I I think a lot more people without doubt, but that was the reason. And it was just a stupid startup that where we just thought, you know, how productive can you be? I don't remember the commit it was.

That is so funny. And how long like I guess do you think of that company as a success or not? Not really. No. Um but it's interesting because I do think it is a capsule of what makes Silicon Valley so great. Uh I will meet people to this day who will talk about how much they love FriendFeed. They'll talk about what we did. I'd say in addition to the like button which we're at least sort of credited with inventing though a lot of candidly a lot of social services had similar affordances but because we did it in the feed and we're uh sort of a Silicon Valley darling at the time where we get a lot of credit for that. We also were the first real-time social network. So that meant that you didn't have to refresh the page. So as people commented, it would stream in and that was really impactful to the to the industry. And to this day, people will talk about those things and say, "God, you guys were so innovative like congratulations." You know, Facebook adopted when they bought you, they adopted the like button. Is that right? A little bit even before, you know, like there was everyone was looking at every like from Tumblr to us was looking at everybody else. Some before, some after.

Um, what was neat about it is like I always use this analogy, but like if if you started a hedge fund in New York and it was a financial failure, but you had some really good ideas. My guess is you don't go to like a cocktail party in Manhattan and they're like, "You had some really good ideas. Congratulations on your financially unsuccessful hedge fund." But I I don't encounter anyone who's kind of in Silicon Valley who doesn't view FriendFeed at least partial success because it was a very innovative product and company. uh we got acquired and and you know the employees uh we all did reasonably well as a consequence of that acquisition. Very grateful to Mark and Facebook for that. Um and so it kind of turned out like we innovated, we moved the proverbial, you know, we innovated and we we changed the way people conceived of social software. It was a good financial outcome for everyone. So by Silicon Valley standards, it was a success. Even though we were basically popular in Turkey, Italy, and Iran, we had zero dollars of revenue and 12 employees. And but that is something and some good stories and some great stories of a three martini lunch. And uh and uh I think that's great that even though I don't think objectively it was a successful company by any meaningful measure, in Silicon Valley, that is a form of success. And I think it's the reason why folks like me started a second company because we innovated. We clearly had a good product culture. We clearly had great ideas. Um, and that meant when I went into Peter Fenton did a benchmark the next time he's like, "Yeah, I'm in." Y, you know, like it was not even a question. And, uh, I think that's great because I don't think people always ask like, "How do you reproduce Silicon Valley and place X?" Or I'll say like, "What's the next Silicon Valley?" Access to capital is important. Access to talent is important. I do think the way Silicon Valley conceives of what is success and failure is very nuanced and very different. And I think the second not just second chances but actually just having more nuance with how we think about failure is so uniquely Silicon Valley and so it it it gives I think it like affords pe makes us take bigger risks in a really positive way and I really love that part of our culture.

I totally agree. When you joined Facebook, did people make money because of the appreciation of the Facebook stock? Both. It was And it was a decent outcome. It was a decent outcome and certainly uh Facebook's uh success afterwards. This is like early 2000s. Yeah. And in fact, it was sort of during the financial crisis. It was a particularly good time to get, you know, Facebook equity. Uh it was depressed. Yeah. It was depressed. That makes sense. So, but and so part of it was just like, you know, for 12 people and who weren't didn't have that much money. It was great. Totally. Totally. How old were you? Uh, I was 20 28, I think. 27. Yeah. How long did it take before you became the CTO of Facebook? I think like a few weeks. A few weeks. Yeah. And how big was the company at that point? I don't know. Maybe a thousand. Yeah. Thousand people. Yeah. And you're the CEO of a 12 person like by It was a really cool Yeah. Yeah. by your definition like unsuccessful startup and then you join Facebook and then within a few weeks Mark makes you the CTO um first of all did you like uh I don't even know how to approach this line of questioning number one how could that happen like how did the the you have so little faith in me how did the like uh how did the the antibodies of change not swallow that decision up so

The preceding part of my story was I had been at Google for a little under five years. So four and a half, five years. And uh I was part of the team that made Google Maps and I was and uh Can I interrupt you here? Yeah. Because I think you're being modest. You rewrote Google Maps in a weekend because you thought it sucked. That is a mostly true story. I'm happy to go through that story. So uh I had experience with a really well-respected technology company at a larger scale and had uh helped create some pretty meaningful uh meaningful products there. So FriendFeed was my first you know time in the proverbial arena starting a company. Um and uh so when I got to Facebook it wasn't just my FriendFeed experience. I think it was like you know on my resume it was also the Google experience. Um, and also I feel actually really blessed to have ended up there because there's a few idiosyncrasies that were specific to Facebook that I I think with the benefit of hindsight I really appreciate. One was it was a very young company. Um, Facebook had just transitioned to let I think anyone sign up right around the time that we joined, not just college students. Um, and as a consequence of that though, most of the people who worked there had used Facebook at college and it was relatively hard to convince someone who had never used Facebook before to work there. It's a consumer service. So people are used to this at enterprise software companies, but like you know it's the thing for college kids like people didn't although I think Snap probably went through this too. I imagine I haven't talked to to Evan about it but I I imagine it's similar. you know when you have something that is like you feel like it was a it's a different generation. So despite being you know 28 29 you know when I became CTO I wasn't exactly like inexperienced relatively speaking right in fact I was often one of the more tenured people in the room so that was just a quirk of Facebook that I think ended up helping and then um I you know FriendFeed despite not being a successful business by any any objective measure we we were thinking about the same problems and I think Mark is a famously first-principle thinker and and I think we respected each other intellectually and so I you know had built teams at Google and built a a startup and and we we really were compatible intellectually. So uh and then and the other thing that I um really tried to do is like be embrace being a part of Facebook. Like I I've been acquired and acquired a lot of companies and that identity shift is really hard for people to make and I really quickly was like I was grateful to be there and I like sort of took off my FriendFeed hat virtual in front of my Facebook one and I think that probably helped with the transition as well like I was uh very much a part of the team there.

What do you mean that identity shift is hard? I I think it's having acquired a lot of companies over my my time at at uh Google, Facebook, and Salesforce, one of the hardest things is like you go from being the founder of your company to if you get acquired being an employee. Um, and I think uh you see it play out in a lot of different ways like we want independence and we want to operate this way and we want to keep our brand and we want our own hiring standards. you want this and any one of those things might be fine. The sum of all of them usually is a emotional response to just losing the identity that you have from being it being your company and and in particular the the uncomfortable thing that people don't always talk about is most people don't choose to be acquired. The founders often do or the the you know people who made the decision but most of the employees made a decision to work for company A not company B. And so, and often, by the way, if it's an acquisition, they're probably in a related market. Might even be slightly competitive. It depends on on sort of market. So, you not only have employees who didn't choose to work for the acquiring company, but often maybe even made the decision not to work at that company to work at the startup. And so you end up where like you might have a great high-functioning team with a really unique technology and all these things but so much of that success isn't just like some you know PowerPoint presentation on the synergies but actually like how do you take this company and make it a team and how do you actually take the individuals there and have them identify in a way that isn't mercenary but actually

You know, sort of, you know, missionary on the like, I am a I'm a part of this company and happy to be do be there and most most don't make the transition. I mean, uh, most founders stay at companies for relatively modest amounts of time. That can be okay, by the way. It's sometimes healthy actually if you can't make that transition.

But you know, you asked sort of like the antibodies and all that. I think if I had shown up resistant to the Facebook culture, I think it would have been a different story. And I tried not to be, just recognizing that I respected the company a lot, you know, like it was the the uh not nearly as big as it is today, but we thought it was like the the best company in the space and I wanted to learn from the the culture in the company. And I think that that authentic embracing of the culture probably helped.

How long were you there for? Not long. Three and a half years, something like that. That's a decent amount of time. You don't think that's very long? The shortest I've ever been been anywhere. Post-acquisition you're saying? Or just in general? Just in general. Yeah. Three and a half years. Yeah. And by the time you three years? Yeah. But not less than three, but I don't remember the exact. And you left to go start another company. That's right. A B2B company. Yeah. Nonetheless, which you've never done before. Yeah. As a first time for everything.

And uh and maybe just as an aside, you are one of the least known, most impressive people in the valley. Like it's unbelievable. Meaning like your ratio of accomplishment to well-knownness is insane. I just I I really respect your versatility. It's amazing. I appreciate that. Um and um maybe just to put a finer point on that, like it's it's almost polymathic the way that you can oscillate from CEO of Salesforce, CTO of Facebook to 12-person, three-martini launch, B2C company to B2B company. Um and that it's just amazing. It's amazing. I appreciate it.

Um uh when you go first of all did was it just the itch the siren the siren songs of startups that called you out of Facebook? Because you know like being the CTO of Facebook, not meta yet, like in 2012, 13 was like that's like I mean in hindsight like it's like the best job ever. I've left a lot of jobs that other people and like probably the most lucrative. Uh yeah, that's probably right. Um yeah, so it was a number of factors. So I'll say the the personal part of it.

Um I had a friend Kevin Gibbs who had started Google App Engine, which is what became GCP. Um when I at the tail end of my tenure at Google, Google Maps had an API that was quite popular. It was probably the first actually I think it was the first meaningful developer product that Google had that anyone used other than the ads API, which wasn't really it was used to automate ad stuff, but it wasn't like a developer community if that makes any sense. But the Google maps API everyone from, you know, Yelp to Trulia, everyone was built on it. So uh every time there was an engineering team who had like a 20% project related to developer, they would be sent my way. And Kevin had made this prototype of basically uh letting developers host applications on Google's infrastructure um uh which I can't I think it was called Prometheus internally if I'm remembering correctly from my it's like a long time ago. I ended up leaving right on the right before that launch, but it was I was really excited about the project and Kevin and I developed a ton of respect and affection for each other. He would always like he he used FriendFeed; he'd send me notes and then he had reached out to me uh probably get the timing wrong, call it two and a half years into my Facebook tenure. He's like, I really want to start a company with you. And I was like, I really want to start a company with you. And I was like, but I just have more to do here, you know, I felt a sense of obligation to Mark Zuckerberg and Facebook, you know, and and cared about the place too, you know, you sort of start to develop a little loyalty. And then uh he said, okay, I'll like I can't wait forever. But I'll wait a while.

And then um Facebook went public and a lot of things and I was like sort of felt like it was like an okay time to leave, like I wouldn't have a sense of not doing right by by this team that I cared about. And then similarly we had gone through this really awkward transition to mobile at Facebook. Now I think Facebook's viewed as someone really benefiting from mobility. Um there's a point when I was CTO where our iOS app had a one and a half-star rating in the app store. Uh we had um made some bad I'll take full account some bad technology decisions early on. We had when Blackberry was popular and the trio was popular and all these legacy platforms. We had this really like write once run anywhere kind of architecture that was made everything work on these devices, but it was just like shitty. Um and it was sort of like and then relatively quickly, it's almost like the AR market; it like things moved really fast there. It went from, oh, there's a billion mobile platforms to clearly just Android and iOS are going to end. And so we end up like rewriting our apps also during my tenure. So I could at least take credit for fixing [__] I played a part in in making. Um and and made a really high-quality experience. Part of that um Mark and and and the whole exec team, Shre, Chris Cox, Cheryl, we we basically were dog fooding our own products. We used Facebook Messenger ex like exclusively to communicate and we uh posted in Facebook groups instead of using mailing lists mainly just so that we were experiencing the pain of using our mobile products like every day.

That's the proverbial dog fitting like the contours of the technology. Exactly. Exactly. And it was really effective and we got out of that. We also had to reform our business model too with mobile ads and it was a really like a growth moment for me and it's nice to like have some mistakes that you like you know learn from and and not nice but you know it's like you you learn a lot from those mistakes. So then, you know, you come out of that and I've got this engineer and Kevin who I like think is one of like the best people I've ever worked with and like I was like I the idea of him starting a company that I wasn't a part of just like tore me up inside and then I saw the impact. I just want to work with him. You know, it's like these people that are like your creative foils like you just want Yeah. I have a list of Avengers in my mind that I kind of like catalog of like these are the Avengers. And uh the and then the other thing is I'd seen the impact mobile had in our business and a little bit like we're talking about large language models now. I was just thinking about the impact it was going to have in all these other markets and in particular because of that dog fooding experience that I had. I was like wow literally 0% of the enterprise software products we're using even work on my phone. Um this is and I was like this is kind of interesting is like what will is there an opportunity here to build something for teams and for companies that you know is there an opportunity to like unwedge the the offices of the world and the others that are built on like you know the metaphors of the desktop and do something native here? Probably like Quip was actually a reasonably successful product in that space. We did well; it was it was a sustainable company unlike FriendFeed, you know, had a lot of customers, revenue. Slack was obviously a much stronger company in the space, but I think a lot of you I don't know if you think of Slack as like a mobile company, but I do think the emergence of like messaging other than email would not have happened if not for push notifications and the mobile phone. So, I think there's a bunch of us sort of circling around that concept and a number of uh kind of meaningful companies that came out of space. But I got to start a company with Kevin which was which was fun and sold it for like almost 600 million to uh 750. 750. Yeah. Uh to uh Marc Benioff at Salesforce. Yeah. And um him individually. So the stories. Okay.

But but but okay. But but the stories tell me and again whatever I read in the headlines I'm sure is definitely true. But um the stories as I read them were um similar to you having your eye on working with Kevin someday. Mark had his eye on working with you someday. Um I you know it's actually you could interview him and ask him that question. I I certainly want to work with Mark and I think you know I I think he shared the affection but you know it's a big acquisition. There's a lot that goes into it's not just that. And and how long from acquisition to like up the elevator to the top floor of you being the I guess it was like chief product officer, right? So I operated the Quip business unit for a year. Um it was really fun. We had a great time. We learned so much. You know, I um you joked I hadn't done B2B software. Well, you know, we we sought advisors. We talked to people like you. We're like, how should we structure our sales team? And then you go into Salesforce, which is I think unambiguously like the best go-to-market team in enterprise software and you're like, oh man, we are idiots. You know, it's like I don't describe it; it's like you think you're a good painter and then you see Da Vinci and you're like, "Oh, I" So, we were just like that first year I was like a sponge just like, you know, re rethinking Kevin and I just rethinking like how we did everything as it relates to bringing our product to market. And and it was fun to just, you know, really grow the business actually and and uh it made I think the whole team who worked on Quip just happy that we did the acquisition. And it really like put on these like rocket boosters behind our business and I think Salesforce has done that incredibly with a lot of acquisitions actually just like Mulesoft turned into an amazing business after acquisition. Like this the the deal thesis worked, you know, it was really working. And then after a year, Mark asked if I was willing to be chief product officer, the chief product officer state of the company actually just wanted to transition into kind of like different more strategic role less, you know, operating as you know like operating these huge teams; it's like a it's a job, you know. And so I think he wanted to take on a different role, definitely a job. And um I uh it wasn't the plan at all, but I um I really was grateful for to be a part of Salesforce. Um I was had a really good experience that first year and I really felt an obligation to Mark. So I was just like I'm going to say yes to anything he asked me to do because uh you know I wouldn't be here if not for him. And and it was very personal for me in that respect like I was like you know you say jump I'll ask say how high like and I was really learning a lot. So was chief product officer for few years I think I can't remember the exact number and then became chief operating officer for a couple years and then then COO. Okay. Was the You don't have to answer this, but like was the plan to be the CEO? Uh, not my plan. Certainly. I don't want to speak for Mark. Like he might have had some plan in his head, but but I don't I don't know. Um I actually not planned on staying there as long as I did. Not Not at How long was it net? Seven years. Seven years or so. Yeah. Um not because I was like didn't want to be there. I just didn't I didn't think I would find such a a great career there. Um and I just ended up saying yes to the opportunities that Mark gave me and then feeling a lot of loyalty uh to that place. And so, uh and then the pandemic happened right when right after I became chief operating officer, right after the previous co-CEO left. So, I ended up sort of like thrust into the probably a different flavor of the role for anyone, you know, Salesforce when I left had about 80,000 employees. And so like operating in a company in a global pandemic that's got you know 70,000 60,000 employees is like it's a it's a complex uh job to say the least and uh so I ended up just in a different you know like a lot a lot of things happened like a global pandemic that no one predicted. So um and then you know just it was it's uh so I don't think any of it was like a the plan but you just have to sort of roll with the punches. Okay.

During all this time, you obviously make fantastic wealth like generational money. You had mentioned earlier that when you were thrust into the uh OpenAI mediation, your wife was the one that actually ultimately encouraged you to go do it. Maybe as you describe your journey, you talk about your plans. It almost seems you never it never goes according to plan, but you clearly plan these things out. like you think about this very intentionally. So I'm curious like today sitting here are you thinking about what are you thinking about intentionally around that plan?

Well, I mean I'll talk first Clay my friend and I like we want to uh my our plan is to make Sierra an enduring uh public company and our goal is have it outlive us. Um and which I think is hard to do in the tech industry. I mean just quick aside, Facebook's first campus was Sun Microsystems campus which had been after sort of a long decline acquired by Oracle. Google's first campus was Silicon Graphics SGI's campus which uh you know once was a great company and then was essentially renting out its campus because it had declined. Um there are companies like Microsoft that have gone through multiple technology phases and remain strong. IBM actually is you know maybe an example of that too. Uh I think Arvin did a great job there. It is hard. It's more likely that you actually your your company was created for one era of computing and then like the world moves on. And so that's our that's our goal and our ambition. There's two parts though is listen to your question is like how much you you obviously don't uh you're not too rigid around those plans. I think that's true. I actually most of the unhappiest people I know are rigidly following a plan and not uh observant of their own happiness or observant of the opportunities around them. Uh and I actually think that a big part of life is recognizing when there's a unique opportunity that you didn't plan for and and asking yourself the question is like should I change my plans? Uh whether that's in your personal life or or your professional life. Um I think this is the quote I always I heard was Eric Schmidt to Sheryl Sandberg. If someone offers you a seat on a rocket ship, don't ask what seat. You know, and I I like that philosophy of life, like, you know, I do think especially in Silicon Valley, there's just unique moments and you just have to uh be self-aware and aware of the market. And then the other thing is like being philanthropic, I I really care about philanthropy, but I love to work. Uh I there's this Alan Kay quote the best way to predict the future is to invent it and that is like my operating principle and I I want to impact the future and I want to help invent it and I think the idea of sitting on the sidelines and you know drinking of my tea on a beach doesn't give me joy at all like I want to build. Uh and so after I left Salesforce, by coincidence, ChatGPT like came out right then and um had Clay ended up we ended up having lunch. That's how we decided to start a company together. But I would be I would be building open-source software of not running a company right now because I would I just want to work in the technology and help shape it because it's the most exciting technology of my memory and I want to play a part in in shaping how we all use it.

Maybe more of a dumb question, but it seems to me that when people reach your level of success, whatever that is, like they tend to their next company tends to be one that's like a higher calling, right? Like a pursuit that's deeply meaningful to them, right? Let's just say like um uh Brian Armstrong doing New Limit, which is like longevity, right? are obviously Elon and all the things that he's doing. It's like examples of these things for you like it's like I don't know like Quip or Sierra like it's not the thing that you probably are like the most personally passionate about ever. How do you think about like I don't know there seems to be this trope in Silicon Valley that is work on the thing that you're obsessed with that you wake up in the morning. Um I I'm just curious like what your reaction is to that.

Well, it's interesting because I I am extremely passionate about Sierra. So, you know, I uh let me just start with like I think once you've had success in your career, I think there's some people like Elon who famously like invested all of his money in his next thing. How amazing is that, right? That take the permission of having, you know, few money and and and and like take more risk. And then there's some who, you know, I think uh once you've been successful, it's not particularly fun to fail in public. And so there's another aspect to I think a lot of folks who come into wealth where you could argue it's a passion project, but I think it's also I've noticed a lot of people I know and I won't mention their names, but like they'll their next thing is decidedly like lower risk um because they have like more reputation to lose. Yeah. Yeah, trust me. Like everyone every entrepreneur knows the feeling of failure because whether even if your thing worked out in the end, you know, when when Chesky was making Obama O's at the you know DNC, you know, and literally sleeping on an airbed somewhere, you know, it's like it's fun to talk about now because it worked out, but like I bet it wasn't that fun at the time. Right. And then you know uh and then you have uh you see it all the time with second or third-type entrepreneurs like on social media. People sort of root for their demise. I don't know what it is. Maybe it's jealousy or whatever it is. I I always root for entrepreneurs. Like even our fiercest competitors at Sierra like like I'm like it's hard for me to root against an entrepreneur. like I just like I I it is I feel a connection to you know everyone who's taken the risk to start a company and I do think that the target on your back is bigger the expectations are higher um you can raise more money which raises the stakes of any modest failure you know even higher so I think it's really hard I think people don't really talk about it very much and I think you know uh I'm proud to put myself out there and like yeah this like I don't I don't think Sierra will fail at this point we we have a pretty endor business but you know when we started it was just you know, two guys on a whiteboard, uh, as any other business starts. And I think that's really hard to do. Um on the passion side of it, I I think that there's the consumer side of AI, there's the AGI, I'll say the research side of AI. I'm really excited. I've I grew a deep affection for how can you make this next generation technology just not just the domain of tech companies? And I actually think that if you look at empowering products that actually like Shopify is to small retailers like you know now a mom and pop shop can have just as sophisticated of a commerce platform as a big company. Those tool-making companies I grew a lot of affection for. So what I think of Sierra like why it's so exciting for me is we're helping every company in the world not just like the tech ones make their AI agent like the one that they want. uh and actually

How do you empower them to do that when they don't have the same sophistication and AI that you know, say, some company here in San Francisco has? An incredible challenge. And that's why I bring up things like Shopify. I really admire that company because they serve entrepreneurs. I was on the board—on the board—um, I think it's stuff like that. So actually, I'm super passionate about it, and I actually love making—I love making tools for people and for businesses. And I think Quip was a form of a tool, and as is the Sarah platform. It's incredibly rewarding, um, like seeing, you know, like there's a SiriusXM is one of our customers, and there's a team there that maintains Harmony, their AI agent, and they have the title AI architect. And like, I don't know if they would have had that title before us, and now we've empowered them with this incredible new technology. How cool is that? So it's really satisfying.

Can I revisit briefly the point about like the reputation and like let me pull that all the way through for you. Like you—you know a bunch of people, as do I, that did something amazing, and they will make up excuses why they're not doing something equally huge again. But I think we both know that deep down the real insecurity comes from burning down all of the currency of reputation that you've built. Do you think it's—why do you think that people are scared about losing that? What are you losing in your mind? Like, as you think about, all right, I go do Sierra, and it doesn't work. Let's just say, yeah. Like, what then? What do you—know what I mean? Like what happens?

I think uh, we mythologize entrepreneurs, and so you know, if you've started a successful business, there's this sort of idea of it was your magic touch, your great decision—m, and then when you have multi-time entrepreneurs who's done multiple things, they're like, you know, godlike or whatever. And it's not [__] obviously. There—literally to have started two successful companies is so remarkable statistically, you deserve the—deserve the praise, but I do—I—I cringe a little bit at it because I'm like, I don't want to dissuade that person from doing a third thing because then all of a sudden, oh, you're not batting a thousand anymore. Was that really you or was it the market conditions or D? And actually, I do think—no, I get it. It's just humanity. It's like the schoolyard. But like social media and the mainstream media will go around and collectively like judge, you know, judge these things. And I—um—part of the reason I just like cringe at it is like I—I admire people who take risks, and I admire people who start companies, and I admire people who uh are willing to uh put themselves out there to fail, and quite literally it shouldn't matter. You know, you still have your wealth, you still have your family, you still have all the other things, but 100% you care. You know, like no one has so little vanity that they don't care when an article comes out saying, you know, they failed, or—and and there's a certain amount of personal—you are a failure, you know, it starts to become your personality. So, I get it. It's really hard. I thought about it when we started—when I started Quip, let alone Sierra. And um, you have to overcome uh the safety net of, you know, like before I started Sierra, that map story existed, and you know, Quip was a high-priced acquisition, and d, and then you go like, you know, this is the last—you're irrelevant again—I could be irrelevant again, and if it fails, that's probably like the the first page of the the book, you know, sort of thing, and then you just got to be like—like this is—this is—I want to start a company because it's how you have an impact on the world, and I want to do—Um, but it's really hard to do. And I actually—I'm like the enabler though. Like I—if folks—I always am like the one like, you've got—you've got this vision for the future. Go do it, and do it the right way. Like take that risk, build that team.

Um, there's a lot of subtle things too though, like it's—I think having experience helps in enterprise software a lot. Uh, just, you know, the actually building the machine of a go-to-market engine is something that is uh repeatable uh across companies. Um, and uh similarly, like you know, having an intricate understanding of like how procurement works at companies and how software is bought and sold and like the enterprise software landscape, and so I think it's why uh, you know, if you look at Workday, uh, you know, started by—that was a—second company, and and remarkably successful—both were really successful—um, and you—I believe ServiceNow was too—I don't know the whole history of it. So if you look at all these companies, you know, it's uh—there—different parts of the market, you know, being a repeat entrepreneur has some—like your experience has a lot more value. Consumer nowadays is—is quite hit-driven. I mean, there's some innate uh sort of viral growth techniques and things like that, but I think it's—it's harder to to intentionally just repeat uh—there—by like methodologically, you know, uh kind of uh replicating, you know, your lessons from the past.

Is there anything—what is there anything that has most surprised you that you feel like is not what you expected it to be or let you down having reached the success that you have? Whether it's the street cred that you thought you would have and what that means for your identity and ego, whether that's the money, whether that's the technologist that you thought you would be that you ended up not becoming, whether—I—I don't—whether that's the houses you get to own everywhere. Is there something that felt like—is there something that you imagined—you daydreamed about like when you were younger that now being there—like that's absolutely not what I expected?

No, I mean, my life has exceeded my expectations, and I'm very grateful for it, and so—and I have a very open mind, so I probably have been surprised by things, but I always try to recalibrate. I try not to have uh sort of an ossified view of what life or the future will be like, and I'm a very curious person. So I—I—I'm certain I've been surprised at things, but my reaction is not—oh my gosh—it's like—tell me more, you know, it's uh—I do think it is something that is—I've seen like people like Patrick Collison who's got to be like the most curious person I've ever met. I try to—I might be one-tenth of him, but I'm—I have that personality. Surprise is like a—not quite the motion. It's like curiosity, and I just—I'm constantly like recalibrating my priors.

Maybe one more question, and then I'll get you out of here. Like uh, you had mentioned this idea of sitting on the beach would kind of drive you crazy when you uh—when you're away from work. Does it drive you crazy?

Yeah. I—not drive me crazy. I mean, like if I'm doing something with my family, it's amazing. But if I just have a free weekend, I'll work, and so—and I'll uh, you know, or I'll uh write code or develop a project uh or I'll cook a meal. I like—I like building things and doing things. So, it's a blessed and a curse.

When you cook a meal, do you listen to anything?

No, just quiet.

Yeah, I'll chat with my kids or something. But yeah. Yeah. I—for me—I like making software for similar reasons like making meals. I like making things for people and having them enjoy it. And so for me uh cooking a meal and eating meals is like a social process. You know, you do it for the people you love, and you—you do it as a collective, and uh I just love the whole process.

Uh, I do too. It's also like active. You know, you're using your hands. You're thinking about what you have to do. Even the grocery store is like part of the process for me—go to the grocery store, get some food, and then you know, I'm always like—I always do the like, oh, this one—this one's not as good as usual, you know, like I always have to qualify it.

You almost care more than your guests.

That's right. That's right.

Uh, I appreciate you doing this. I really do. Um—um—is—is Sierra hiring?

Sierra's hiring. We're hiring in San Francisco, New York, Atlanta, and London uh across all departments. So, uh core engineering, agent engineering, uh go-to-market operations. Um, so, all of the above. We're growing like a weed and uh growing in all markets.

Uh, last one—I ask every guest—when you hear the word grit, what do you think of?

Uh, like mental resilience. Like that's what I think about. I think uh the ability to overcome meaningful setbacks and—and so I—when I hear the word, I always like relive my own. And—and uh—but I—I love the word.

Thank you. I—I can't wait to do this—maybe not 10 years, like maybe every few years. You can revisit—revisit your progress.

Yeah. Sounds good—and see how things are going. I appreciate you.

Yeah. Thank you. That's it for now. If you like the episode, please leave us a review or go back into the archives where we've done more than 200 episodes with some fantastic folks. This podcast is a Kleiner Perkins production, and I'm Juben. Thanks for listening. [Music]