Transcription
What are you seeing in the private markets in certain isolated instances that maybe reflect some anxiety that we're getting in the public markets?
Well, I'm old enough that I lived through the last bubble, Caroline. And history doesn't repeat itself, but it rhymes. Yeah. And there's definitely some rhyming going on like me. And the valuations are high and they're high early. The thing that's different is, my goodness, is there galactic level growth in these startups? The demand is amazing and it sort of started at the at the at the model level and then went to infrastructure. The app level companies are absolutely ripping now. And so it's an interesting time. It's different than '99.
How are you therefore setting up, as you're helping CIOs become from start up to scale up mindset? And 11 labs, for example, which I had time and time again getting adopted, even Jensen Huang saying how much she's loving that particular product that's a CEO you're helping navigate. What do you say to them in these moments?
So if I were a founder and I were worried it were a bubble, I would do a couple of things. First thing I would do is in my next round, I would take a little bit of money off the table. Oh. The second thing I would do is I would raise a lot more than I planned because if it is a bubble and it dips and it eventually comes back, you want enough to last through. Those would be the two 2021 mindset. A little bit. A little bit, yeah. A this company in 2014, a lot of great companies just didn't kind of make it out. They didn't raise enough. They didn't make it through. And if you look at '99 or the bubble era, you know, some good companies came out of there, Google came out of there, Amazon came out of there, Salesforce.com came out of there. And so even if the valuations are really inflated, if you can find some amazing founders, I mean, there's there's going to be a lot more than three that come out of this one. There's a lot more than three companies trying to get in on each other's space as well.
And this is why I kind of marketing comes in and I want your brain space as someone who's helped led HubSpot founded it, but also you've got this great new book out. I'm no Deadhead, but I know many people are. You are a quintessential Deadhead. You love all things about the Grateful Dead, but you think we should look at the Grateful Dead as a marketing model as well? What is it about community? What is it about? I'm sure it's not about bootlegging, music. Anything is the thing to repeat.
Absolutely. There's so much founders can learn from Jerry Garcia and the Grateful Dead. First of all, Garcia was like the ultimate in original Silicon Valley founder founded in Palo Alto, built an amazing company. He did a lot of interesting marketing things that all the founders that coach are trying to do. First thing he did was he kind of created a whole category around this thing called Jam Band. So lots of people follow around. Hard to do. Second thing he did is he didn't use traditional ways to market his product like radio stations and albums. He let people come in with all their equipment and record the concerts and trade tapes. He went. He was like the first viral marketer in Silicon Valley. The third thing he did that I think is quite remarkable is he didn't like that Ticketmaster and the Scalpers, made all the money and inflated the prices for his customers. So he disintermediate those two layers and he said, we're going to start a ticketing company and we're going to sell tickets directly to customers. We're going to cut out Ticketmaster and all the scalpers. So he thought in a very original, like he was a he was a radically first principles founder. He rides a lot with Jensen Huang rhymes a lot with Sam and Rams a lot with Steve Jobs.
What's interesting and I going to keep going with this Grateful Dead analogy because I love it, disbanded in 1995 after the passing of Jerry Garcia, and there's been different combinations since then and CO We see some artistic differences, dare I say it, there's a few artistic differences at Sequoia at the moment and invention more broadly. You've been at Sequoia for a year. There's been a lot of change at the top. How are you seeing the venture community set up for this moment? What can they learn from Grateful Dead and from entrepreneurism in this one?
I think Sequoia is particularly well set up at the moment. The two new leaders are fantastic. They've been there a long time. They have amazing track records and like I think of the stack as like the hardware, the labs, the infrastructure, the apps. Sequoia is well-positioned with amazing investments across all of them, particularly at the app level and particularly here in New York City. Last night I had dinner with the CEO of profound, terrific company that does not CEO, but like a CEO for Chachi, Beaty and Gemini in the founder of Rogo Fantastic CEO Rogo is like A.I. for investment bankers. I think this is emblematic of what's going on. The app layer is starting to pop and Sequoia is in a lot of these things. Other great companies in New York Basis is selling to accountants. You've got Crosby and Harvey selling to lawyers. New York is actually having a moment in AI and it's kind of at that app level. The app level is where perhaps the productivity really starts to rein in. That is what the proof point is needed, many would say, for the market when actually you and I are not just using it for our own personal life, but see productivity go up into the right and companies start doubling down on the purchase of these applications.
What does that show up? When do we stop even talking about an eye bubble? Because we see the productivity?
Well, there's just giant demand in galactic growth. One of the interesting things about all these founders is I'm like, well, you're certainly going to grow with less people, right? And they said, well, actually, no, we're hiring, really hiring aggressively. And so, like, there's some people are like, AI is going to make humans unnecessary. They're like, now we're going to make users unstoppable. And that's sort of the mindset across most of these AI startups. So they're pressing hard, hiring hard, growing hard. And I think you'll start seeing over the next couple of years big productivity advantages like HubSpot uses AI across the enterprise in customer support and R&D, massive productivity benefits across a couple of big parts of the enterprise.