20VC: Datadog CEO Olivier Pomel on The Scaling Journey to a $26Bn Market Cap, The Challenges in Moving From Single To Multi-Product Company & How To Scale Efficiently into $M+ Enterprise Deals

Olivier Pomel is the Founder & CEO @ Datadog, the company building the next generation of tools for DevOps teams. Prior to their incredibly successful IPO in 2019, Olivier raised over $147M for the company from Index, ICONIQ, Meritech, IA Ventures, Amplify and OpenView, to name a few. Prior to founding Datadog and changing the world of devops, Olivier was a VP with Wireless Generation for 8 years leading an engineering team of close to 100 of the best developers in NYC. In Today’s Episode with Olivier Pomel You Will Learn: 1.) How Olivier made his way into the world of startups and what was the a-ha founding moment for his creating of Datadog, changing the world of devops? 2.) Why does Olivier believe that "short term failure is a source of long term success?" Why did both seed and Series A investors not get Datadog? What would Olivier have done differently if fundraising again? What do investors misunderstand today when investing in big markets looking for the "entry wedge"? 3.) What has been Olivier's biggest learnings on how to run Datadog during a pandemic? What attributes does Olivier look for when hiring senior leaders? Why does Olivier believe the CEO has to be the "equaliser in chief"? What does that mean in practice? How can leaders creat eenvironments of safety where their team can approach them with anything? 4.) What have been the biggest challenges in moving from a single product to a multi-product company? How does one know when is the right time to add additional products? What is Olivier's decision-making process to determine which products to build next? 5.) How does Olivier assess his relationship to money today? How has it changed over time? In what ways has becoming a father impacted Olivier's operating mindset? What 3 traits would Olivier most like his children to adopt? Item’s Mentioned In Today’s Episode with Olivier Pomel Olivier’s Favourite Book: Kurt Vonnegut As always you can follow Harry and The Twenty Minute VC on Twitter here!

Speaker names marked ? are inferred from speaking time and the show’s known hosts — they are not voice-verified.

• 0:00Harry Stebbings?

  This is 20 VC with me, Harry Stebbings, and diving straight into the show today. Few IPOs over the last few years have been as successful as Data Dogs. It's become a darling of Wall Street and I'm so excited to welcome their co-founder and CEO today. Quick side note, Olivier was one of the most humble and authentic guests I've had on the show. Made it such a joy to do, but as mentioned, Olivier is the co-founder and CEO at Data Dog, the company building the next generation of tools for DevOps teams. Prior to their incredibly successful IPO in 2019, Olivier raised over $147 million for the company from Index, Iconic, Meritech, IA Ventures, Amplify and OpenView, to name a few. Prior to founding Data Dog, Olivier was a VP with Wireless Generation for eight years, leading an engineering team of close to 100 of the best developers in New York.

• 0:43Harry Stebbings?

  I do also want to say a huge thank you on the schedule though. This was such a team effort, Jerry Newman, Sunil at Amplify, Shadul at Index, Dev at MongoDB and many more. I really do appreciate your help on the schedule. But before we move into the show today, I have to say I just love using Angel List's fund admin platform to manage my investments. The team and platform at Angel List takes care of all my back office needs so that I can focus on working with great founders. Leading fund managers have made over 10,000 investments into 6,000 startups via Angel List, all online and all in one place. And with the recently announced Rolling Funds, you can easily find and invest in these top fund managers on angellist.com/rolling. And speaking of incredible customer experiences there with Angel List, Mercury is building full stack banking for startups.

• 1:27Harry Stebbings?

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• 2:10Harry Stebbings?

  Connecting you with elite global talent and owning end-to-end processes. From hiring to onboarding to remote teams integration, Terminal delivers the product building powerhouse your business needs to grow. From workspaces to on-the-ground support, they take the guesswork out of remote management so that you can thrive. But don't take my word for it. Take the word of Gusto, Chime, Earnin and Hims, all trusting Terminal with their remote teams. And you can find out more today at terminal.io. But without further ado, I'm now so excited to hand over to Olivier Pomel, co-founder and CEO at DataDog.

• 2:46Speaker 01

  You have now arrived at your destination.

• 2:49Harry Stebbings?

  Oli, it is such a joy to have you on the show today. I've heard so many great things from man at Iconic, from Dev at Mongo, Sunil at Amplify, Shadul at Index. So thank you so much for joining me today.

• 2:59Speaker 02

  My pleasure. Thanks for having me.

• 3:00Harry Stebbings?

  Not at all. I've been excited for this one. But tell me, you know, DataDog, it's been a 10-year journey. So take me back to the beginning and tell me, like, what was the founding moment for you with DataDog? And what was that aha realization?

• 3:11Speaker 02

  So my co-founder and I used to work together in different companies. In the last company we worked at, he ran the ops team and I ran the dev team. And those two teams were actually fighting all the time. And so our starting point was, there's got to be a better way. Like, we've got to find a way to get Dev and Ops to talk to each other, work together, see the world the same way. And that was the starting point for DataDog.

• 3:29Harry Stebbings?

  Got you. I love that. But before we probably dive in, you said to me before, and I love this, you said, "short-term failure as a source of long-term success." Can I ask, what did you mean by this? And how do you think it actually shapes who you are today?

• 3:43Speaker 02

  Yeah, so the story there is that it was actually very hard to raise money for DataDog initially, back in 2010, when we started it. And it was difficult, right? You know, when you start a company, first you're super excited because you say, "I'm going to solve this great new problem. I'm going to be my own boss. It's going to be fantastic." And then three months in, you know, we had no customer, we had no money, we had no product. Nobody thought it was going to work. It was also the winter in New York. It was cold and dark. And so we were in the middle of that valley of darkness, so to speak. And what this forced us to do was really to focus on the problem we're trying to solve, like focus on making sure it was a real problem. And I think that ended up being the roots of our customer. Century City at Data Dog. So everything we became in great part was because of that. We had to focus on the basics.

• 4:25Speaker 02

  The other thing it forced us to focus on was having a business that was lean and efficient because we didn't have the money for it initially. And so if you play that back and see where it led us today, like we have a business that is fairly profitable for businesses is growing very fast. And we can trace that back to those days.

• 4:39Harry Stebbings?

  But you know, in that valley of darkness, I have to ask, did you always know it was going to be successful or did you doubt yourself and were there those moments?

• 4:45Speaker 02

  Well, you always doubt yourself in those moments. I think that's one of the reasons why it's good to have a co-founder. Because your laws are not completely aligned. So there's always someone to pull the other up in those times. But you know, the way we dealt with that doubt was to go back to first principle, go back to the customer, go back to making sure there was a real problem and we're latching on to the right thing.

• 5:04Harry Stebbings?

  Yeah, I spoke to Sunil at Amplify there and he told me about the challenges raising the Series A. Can I ask, and he asked the same, what did investors not see? And I guess what would you have done differently with hindsight?

• 5:15Speaker 02

  Yeah, so when you go back to that time, when you looked at the market we're entering, which was broadly speaking, monitoring. It was seen as being a very crowded market, like there were tons of old companies doing it, a number of new companies doing it. My co-founder and I didn't have any direct experience in the market, who were on the customer and user side of it, but we hadn't worked in the industry before. And so it was not very clear to the investment community that we were going to be the people to solve that basically. They thought it's really hard to actually break out from the back and we don't think there's other people who are going to do that. I think what they missed is that precisely because we were not part of the existing industry, we were not just building a better mousetrap, but we were having a very different approach that ended up being significantly better and led us to where we are today.

• 5:57Speaker 02

  Like the focus not on, hey, let's build a better monitoring product, but rather on, hey, let's bring Devon Love's together was completely new. The other thing that I think a lot of the investors missed at the time was that, at least back then, I think still today to some extent, you kept hearing that to enter a big market, you need the wedge, you need something really sharp and really specific, and then you expand from there. Turns out for some classes of problems, such as infrastructure management, which is what we do, the wedge doesn't work. Like there's a large amount of stuff you need to do from there on if you want your product to be useful. And our initial product was positioned as a very broad platform to bring more. Multiple teams together actually didn't have that wedge aspect and disconcerted some of the investors. I would say, you know, in terms of doing things differently, I wouldn't change anything. I mean, failure to raise initially was what made us.

• 6:39Speaker 02

  All those constraints are how we build the culture of the company, how we found certainty about what it is we're building and for whom. We owe our success to that in a large amount. By comparison, I would say today I see many new companies that are extremely hot from the seed stage or series A and you know that better than I am, but VCs trample over each other to invest in the companies. And as a result, it's tempting for the founding teams of those companies to believe that they're already successful, that they've solved the problem, that they have the right solution. And usually it's not true at that stage. And I think it's a problem. Like, I think it's a recipe for having a troublesome first few years and a really hurtful realization at the end of that, that you're in the wrong spot.

• 7:17Harry Stebbings?

  Can I ask you, I've just had, I just met with a founder, obviously having a VC by day, I just met with a founder that's just getting around done at a three hundred million post. They're pre-revenue and they've got five design partners. For me, I'm just like, oh my God, I am so worried. Do you share my perspective when you see things like that?

• 7:33Speaker 02

  Yes, totally, totally. And I think, again, this is because it's showing all the signs of success before there is actual success. Like, you only have actual success when your product solves the right problem for the customers and they're using it and they're buying it. Before that, you have ideas that maybe you'll get there, but there's still a number of things that you need to do and you need to get right. And I think humility in the face of the problem and humility in the face of the customer, especially for, you know, B two B businesses, is absolutely critical. So these doubts, these constraints initially, I think are a good thing in general.

• 8:00Harry Stebbings?

  I loved another thing that you said to me before, which is simple product as much as about company design and business model as it is about product design itself. It was super interesting and a bit of a cliffhanger. So like, can you unpack this one for me in your thinking?

• 8:12Speaker 02

  Yes. So when you think about building a simple product, many people think of UX and who is it going to look? Maybe I should hire some people who've done UX for great consumer products and then they're going to do the same thing for me and my product will be simple. It's not as simple, actually. If it was as easy as hire a designer and ask them to make things simple, everybody would have simple products. I think to a large extent, the simplicity of the products is driven by the user base you have for those products. So in our case, we made a choice to have a very broad user base and customer base. You know, we serve with that dog, anybody from on the low end, individuals and students to on the high end, you know, the largest companies in the world and everything in between, pretty much. What this means is that whenever we we pull towards complexity by our largest customers, we have the counter pull of all these small customers and individuals

• 8:57Speaker 02

  that still have to be able to interact with our product on their own as mere mortals and pull us towards simplicity. So this choice to have a very broad customer base is then what actually informs what goes into the product, what gives us the right feedback loops and ends up, you know, with us producing a simple product.

• 9:12Harry Stebbings?

  You said there about the kind of the spectrum of the customer base itself, I suppose the team at Maritex in particular, who said when it comes to the go to market, they were so impressed specifically with how you went from self-serve to smashing, in their words, smashing multimillion dollar enterprise deals. So how do you think the go to market's evolved? And I guess when you look at the success, what have you done that have made you the success that you have become in the go to market?

• 9:34Speaker 02

  So to have this very large customer base, like to sell to individuals and small companies as well as big ones, we needed something that was very low friction and it could be adopted bottom up. And when you think of go to market, go to market always goes hand to hand with product. Like you can't just say, hey, my product is this, but I'm going to sell it that other completely different way. That doesn't work. Like the two actually have a very intricate relationship. So we built the go to market to be very low friction, all bottom up. We found that there's actually a real continuum from, you know, individuals to SMB to enterprise. And I think that sort of makes sense because developers tend to be the same in small companies and in large companies and they use the same tools. It used to be these were completely different universes, but today when you go buy our infrastructure, you know, from Amazon, for example, like it's the same menu for everyone.

• 10:18Speaker 02

  If you're a two-person startup or, you know, a fourteen fifty, like you end up using the same components. And so the landscape is very much the same and developers think the same way and are going to end up adopting the same kinds of products on top of their infrastructure.

• 10:30Harry Stebbings?

  Can I ask, how do you structure your go to market teams, do you think? And like, what do you think you've done well in terms of the structuring of go to market?

• 10:36Speaker 02

  Well, I mean, we, the various parts of it came at various times, like, you know, we have a slightly differentiated go to market depending on, like we have different teams that sell to you depending on the kind of customer you are, you know, if you're a smaller company, larger company. It all grew, I would say, organically. Like when we started, most of our customers were in SMB. And the reason for that was that eight years ago, the only companies that were at scale in the cloud were new companies and smaller companies. The large enterprises were not there yet. But then, you know, over time, the large enterprises started coming in. And we started selling to them initially from the same sales teams and with the same sales motions. And then as more and more enterprises came in, we decided to specialize the sales team and have different enterprise level teams that understand better who to deal with the requirements of large enterprises. While the developers behave in a similar way, the companies tend to buy in slightly different ways.

• 11:20Speaker 02

  Like they, I would say, more participant to a decision in large enterprise, more boxes to check, you know, things like that.

• 11:26Harry Stebbings?

  I often have founders who say, hey, we're serving SMBs or we're serving individual contributors, but we're getting pulled into enterprise. Should we go? And it's often a challenging one because you have to build out an extreme amount of functionality, security to cater for that enterprise customer. How do you advise founders generally, and I know it's a tough one to be general, but who have been pulled in and are questioning whether it's right to scale up to enterprise?

• 11:48Speaker 02

  Well, it's a great thing if you've been pulled into it, that's great. Means there's a need and somebody wants it, you know. It's much better than we're trying to push into the enterprise. Maybe you're hoping there's something, but you're not completely sure. So in general, I think it's a good thing when that happens. Beyond that, the most important choices you make as a product organization and a sales organization is where you spend your time. So if you're going to spend more and more time with enterprise customers and give them more and more of a voice in your product, you need to make sure you counterbalance that with voices from the SMB and the low end as well. Going back to my comment initially on keeping things simple, you know, otherwise you end up with a product that can be used by the largest enterprises, but none of your initial customers can still use it anymore.

• 12:25Harry Stebbings?

  Imagine the kind of restructuring of teams that in terms of the go to market. I'm intrigued and I spoke to Dev before the show from Mongo and he said, what's been your biggest learning on how to run data dog during the pandemic?

• 12:35Speaker 02

  So first of all, the thing that surprised me the most was that humans are really adaptable. We went from something that was completely unthinkable in a matter of a couple of days or weeks. And then it very quickly became a new normal. And that makes me really optimistic into what comes next, you know, because right now we don't quite know what the world's going to look like next year. But I'm sure that we might also go from someplace to a place that's unthinkable in a matter of weeks or a month, you know, as we go back to some new normal again. So I'm very. Optimistic about that. The thing I learned about running a company was that in times like this, you have to take care of the humans first and then everything else follows. You know, in general, as a company, we like to treat people as adults and in normal times, people can take care of themselves and you need to make sure they're productive and motivated.

• 13:14Speaker 02

  But you know, people can take care of their own lives. With the pandemic, many, many, many of the people on the teams were in some form of distress. You know, it could be mental distress, it could be economical distress in some cases, you know, in some cases it's hard for them to focus because they live in small apartments and they have roommates and kids and family and whatnot. And so we invested a lot in the people themselves, you know, we actually gave grants to our employees to help them solve their own problems. We also decided to donate some of these grants because some people were feeling bad, they're feeling okay themselves, but they're really feeling really depressed and bad about their communities and the state of the world around them. So we also empowered them to donate and help their communities. And that's been a really good experience because we saw, like, everybody's situation is different, right?

• 13:54Speaker 02

  Some people need the money, some others don't. But we saw in the end that our employees decided to give about a million dollars to their communities and that was fairly heartwarming for us.

• 14:03Harry Stebbings?

  That's really incredible to see and I didn't actually know that on the grant program. Can I ask you, in terms of like how adaptable humans are, I'm with you and we adapted brilliantly well. There are also areas where it was just hard. When you look across the org, were there certain functions, processes which broke in terms of the transition to COVID?

• 14:19Speaker 02

  I mean, there's some things we needed to do completely differently, right? For example, we used to run a lot of physical events with customers, like trade shows and things like that, and we were very good at it. So it was a very good source of business for us. Almost overnight, we had to pivot that to being completely remote. Also works, but in very, very different ways. You're going to talk to 10,000 people that are basically a captive audience to 200,000, but you know, they'll only be there for a few minutes and you'll have a little bit of their attention and they will be from all over the world. So the running of the events, you know, is very, very different. So that's one example. Productically, it hasn't made talking to our customers harder, it's actually a little bit easier. And that's because it's easier to schedule time with customers when everybody's just at home all the time.

• 14:58Harry Stebbings?

  In terms of like the leaders that run these different orgs, from sales to marketing to customer success, you name it. Another one that Dev asked was, what do you look for specifically when you're hiring true, like, exact leaders into your business?

• 15:08Speaker 02

  The most important for us. Is the desire and the ability to learn. We don't think we've got, so to speak, our shit figured out in general. We think we still have to learn pretty much everything and that goes back to the early days of humility and trying to make sure we solve the right problem. And we want that from our leaders too. So we're not hiring somebody typically to tell us, hey, this is how I've done it and I've scaled to one billion at company X before and let's do the same thing again. We're looking for people who can say, hey, let's go and look at what's actually happening on the field, talk to the customer, look at the details of the processes and what's working and not working. And let's design the next version of it and solve it and measure it and see if it's going to work better and improve it over time.

• 15:45Speaker 02

  And it's not for everyone. Some people have a playbook and like to stick to it. Some others are really motivated and really interested in the hiring and are also willing to be proven wrong from time to time. I think that's what we're looking for.

• 15:55Harry Stebbings?

  Can I ask, Ollie, you seem so calm, composed, unflappable. Do you ever lose your shit and how do you deal with the shit hit the fan moments when things are really tough?

• 16:04Speaker 02

  Yeah, well, I mean, I do lose my shit. And by the way, when you run a startup and a high-growth company, there's many highs and many lows. There's always something that goes wrong at any point in time. I think the one thing you want in those cases is the work uses equanimity. You know, you want to make sure that you level things, you know, make sure people aren't too scared, you know, when there's a big issue. And everybody can focus on solving it and what comes next. And by the way, as a CEO in general, you have to be the equalizer in chief. You know, so when things look great, you have to temper people's enthusiasm a little bit and say, hey, this looks great, but you know, all these other things are still broken and we need to fix them. Whereas when things are pretty dire, you need to remind people that these two shall pass and our goal is to improve it and fix it and it will get better next week.

• 16:45Harry Stebbings?

  Can I ask, what do you think you do to create an environment of safety for the team and for your employees? Where they feel they can tell you when something's gone wrong and they can express how they feel and they can achieve their best work as well on the flip side? What do you do to create that environment of safety for them?

• 16:59Speaker 02

  Yeah, well, there's a couple of aspects. First one is you actually have to show real interest and you have to engage with the details. Because otherwise people stop telling you things, like if they realize you don't even know what they're talking about. Or you're just waiting for them to leave your office, you know, which you want to show that interest and curiosity and you want to engage with the details. And that's not something you do just when people come to you. You have to do it all the time. So you know. Exactly what people talk about. That's number one. Number two is you have to listen first so that people feel that they can talk. And you should not try to pass judgment right away. I mean, of course, it's tempting to pass judgment like. Anytime somebody tells you something in the back of your mind, you're trying to figure out what this means. Do I agree? Do I not agree? You probably have a few things you want to retort and it's important not to not do that right away.

• 17:39Harry Stebbings?

  In terms of product, you know, another area you've done so well is moving from kind of single to multi-product company. How have you found that transition first?

• 17:46Speaker 02

  Yeah, so you know, when we started, we always saw the company as a platform that would integrate many sources of data and present it to many different teams. Like that was the core mission. That was why we built it. We didn't build it to be a monitoring product initially. That's what we wanted. To get success initially, we focused on monitoring. That was the first use case. It took off. And we spent really the first five or six years, you know, scaling to keep up, you know, adding functionality and making sure we scaled the team and the company around it. We were in a great position to expand though, you know, because we didn't realize it at the time, but that first product, that infrastructure monitoring is the perfect place to land. You know, because it gives you a very large surface of contact with your customer's environment. An infrastructure monitoring product needs to see all the infrastructure, so it's deployed everywhere, wall to wall, to have surface of contact with everything.

• 18:29Speaker 02

  And we built our platform to be used by every single engineers across all the teams. And so we're also used by all these different people. So used by everyone, deployed everywhere, that's our motto. And that's what gives us the room to expand. A few years ago, we added an A P M product, log management product in rapid succession. We have nine products today. I should say the, when we started seeing A P M and logs really take off, that's when we decided to take the company public. Because that's when we saw the proof that the company's ultimate vision was right. And we gained confidence that we could see or deliver a lot of growth for many, many years, basically with those new products.

• 19:01Harry Stebbings?

  Can I ask, in terms of like the decision-making framework for new products, how do you decide what to do versus what not to do? There's always a plethora of options. What's the decision-making framework for yes versus no on priorities?

• 19:13Speaker 02

  Well, you start with the customer always. There has to be a real problem from the customer. You have to be in the right spot to fix it. And then the problem has to be valuable. So all of that comes from understanding the customer and the problem really well. And the solution, you know, typically comes next. And when I say going back to the customer, it's important not to. divert the roles. Many companies have a backwards approach to it, which is the problem they solve is their own problem, which is, hey, I need my sales reps to sell you more stuff. That's not the customer's problem. Nobody wishes for that. Instead, you have to go back to your customer and seeing what other problems do you have? In our case, one thing that helps us is that our product is a fairly open ended platform. Our customers already build their own specific use cases on it. You know, so before we started with our A P M product, we saw customers build poor man's A P M on Data Dog.

• 19:58Speaker 02

  Before we started launching our security products, we saw customers also solve their own security use cases with Data Dog. So seeing customers solve the problems with us tells us that, one, the problems are real and, two, that customers see us as being part of the solution. So that's a great data point for us to get started.

• 20:13Harry Stebbings?

  Totally. Also amazing for retention and prevention of churn. So that's always a nice thing to see. Can I ask, final thing on like the multi-product, is there anything that's really fricking hard about going from single product to multi-product? What do you think people don't see, don't understand, misconceptions?

• 20:26Speaker 02

  I think the thing that's the hardest is that when you're successful with one product, you're used to being successful and you're used to being right. And to having a good product that's fully fledged and everything else. When you start new products, you're going to be wrong. So it means, one, you have to know how to deal with it when you're wrong, and, two, you have to actually want to be wrong. And it's hard. In a culture where you're successful, it's hard for people to put themselves in a situation where they're going to be wrong. They're going to take more risks and they're going to have to fail and then fix it. And we certainly, we had some products that came out fully formed out of the gate and they were fantastic. And we had some products where it took us a while to actually get the basics right and then scale from there. So it's a hard shift, you know, for the teams.

• 21:05Harry Stebbings?

  In terms of kind of adding new products, often it's done with acquisitions. And I, you know, I think one thing that you've done incredibly well is kind of the execution of the acquisition strategy. And many of your investors said this too, actually. So I'm interested in survey, how do you think about your M and A strategy today?

• 21:19Speaker 02

  So we think we can expand in a number of different directions. We have a pretty good idea of those at this point. And that goes back to the surface of contact we have. We typically plan to build everything ourselves, but we find that we can accelerate in some areas with M and A. If we're being opportunistic and find the right fits. Now, the question is, how do you find the right fits, you know, and what makes a company a fit for us? The most important thing is what happens after you actually sign an acquisition. So who you integrate, who you get people to work together. For that, the key factor is culture, obviously, but also having a company that wants to build. You know, there's many, many situations in M and A where a company tried to shoot for the moon. They didn't quite get there. They've been at it for a while and the founding team is tired and they want someone to take it off their hands. That's not, you know, really what we're looking for.

• 22:04Speaker 02

  We're looking for companies that actually want to build and want to spend another three or four years rebuilding and taking the company to its full potential. And that's what we're looking for.

• 22:13Harry Stebbings?

  I'm very close to Jason Lankin at Saster and he says, if there's one thing that will make me not invest, it's a founding team that's burnt out, that's just super tired. How do you think about and advise founders who are maybe in that situation and are maybe feeling the burn after three years and not that much momentum and trajectory? How do you advise them?

• 22:31Speaker 02

  Well, it's hard because on one hand, you know, you have to be easy on yourself a little bit. And if it's not working, you should figure out what your options are. And you know, while we're not a good fit to acquire these kinds of companies, there's many, many other avenues to for these companies to exit, right? On the other hand, I've seen many examples of companies that got very successful after two, three, four, five years of difficult beginnings. So I think it goes back to how much of a conviction do you have about the problem you're solving? And can you actually build more conviction by talking to more customers and things like that? I think that's what gives you the basis for deciding, you know, am I crazy for pursuing? Or is this good grit or bad grit, basically?

• 23:08Harry Stebbings?

  I I'm totally with you. I think it's the hardest question to answer as a founder. In terms of like financing these acquisitions, capital efficiency is always helpful in all respects. And we mentioned earlier where you've been incredibly capital efficient. How do you think about the balance between growth versus profitability? Because with the capital efficiency and the profitability that you have, you could pour a ton in on marketing and you could pour a ton into C S and be much less capital efficient. How do you think about that growth versus profitability?

• 23:32Speaker 02

  Yeah, so one thing that is important to us is that we understand what's load bearing in our business. You know, so we don't throw money unless we understand what purpose it serves, which means we probably won't change everything at once or, you know, throw everything at the kitchen sink as a problem. But at the same time, we want to invest as much as we can. Without breaking the business. And what I mean by that is find the right balance between short term and long term. If you try to do things like quadrupling the size of the team in one year, chances are maybe it's going to be great a few years from now. But for the next year, two years, you're going to be completely out of commission. Like your team will not do anything except hiring and then part of the company will go too fast and collapsed. So we don't want that. So we're trying to grow as fast as we can to still deliver for our customers in the short term while building as much as we can for the long term.

• 24:17Harry Stebbings?

  How have you learned about scaling teams as fast as you have done, as efficiently as you have done? As you said, you haven't scaled headcount ridiculously fastly, but it's been pretty fast. What does it take to scale a team as fast as you have done and maintain it in such a fashion?

• 24:30Speaker 02

  So first, we've been a little bit more measured early on, like we've never done more than double the size of the engineering team in one year, for example. We had to have a little bit of restraint on that and that was precisely so in break the team. Other choices we've made are to really invest in the infrastructure for building the teams. Meaning invest in the recruiting team, invest in the people team, I know that's in the backend of that. Invest in the processes, you know, in between the, I would say the upside of each individual team, whether that's on the engineering side or on the sales side. And that's the recipe for growing an organization, like you need to have another organization that's focused on scaling the organization. And you know, when you think of things like recruiting, for example, you really should think about it like you do of a sales team, like it scales the same way.

• 25:08Speaker 02

  Like a recruiter is going to have a given productivity and if you want to go to team in a certain way, you need to have all of your recruiting capacity online ahead of time. Otherwise, it's not going to work. What I see sometimes from some companies is a little bit of magical thinking there, like thinking, hey, if we just decide we'll do it, it will just happen. It's not the case. When you think of sales, nobody is having magical thinking about sales anymore. People understand, like there's a capacity model and a ramp model for that. It's the same for building and scaling teams.

• 25:34Harry Stebbings?

  Can I ask, when do you think is the right time to hire a head of people? Often it's a question where some people say, hey, one of the first hires, others say it's eighty to a hundred people. Where do you sit on the right time to hire the head of people?

• 25:44Speaker 02

  I'm the wrong person to say because we waited too long. Like we were past fifty people when we had our first head of people, I think. We should have hired that person earlier. I would say earlier than that is my answer.

• 25:53Harry Stebbings?

  Now, listen, you learn from things that you would probably do differently now it's time. In terms of like learnings from things and learnings from other people, you Said before that you don't read business books and details over generalities. What did you mean by that statement and how do you think about it?

• 26:07Speaker 02

  Yeah, that's one of my pet peeves. The problem with business books and a lot of the startup self-help you find out there is it's really hard to understand what applies and doesn't apply to you and you can read a very convincing case for everything and it's opposite. And so what I like to do is I actually look at various business books and all that literature for ideas. But to understand what you should do and not do, the truth is usually in the details of your business. So it's not on the five liners you get from somebody at a cocktail party. Instead, it's looking at dozens of hundreds of customer emails, what's happening in your CRM, what's happening in your support cases, what's happening in the guts of your business there, basically. That's what gives you the ground truth that should inform what you should try and do next.

• 26:47Harry Stebbings?

  One thing that's often kind of idolized in this business is kind of IPOs themselves that seem as like the finish line, so to speak. How do you feel about the IPO and ringing the bell being this kind of finish line for founders?

• 26:59Speaker 02

  You're right, I mean, it's not a finish line, it's a starting line. Basically, when you tell your company public, you're committing to a long time of a certain amount of growth. That's the expectation you set with your investors. So what tells you you should go public in this the right time is that you have a good line of sight on that growth and that future and you are fully committed to show up and deliver it. So it's very much a starting line.

• 27:20Harry Stebbings?

  Can I ask, how does being a public market CEO differ from being a private market CEO?

• 27:24Speaker 02

  Well, it's similar in many ways. I would say, interestingly enough, I do spend a bit less time talking to investors now because it's more coagulated. So it's bundled over a specific period of time and there's a whole team that's assisting me in doing that as opposed to being somewhat always there. Other than that, I think there's a new constituency for the company, which is the public investors. Part of my job is to make sure we have the right of those public investors and that they understand our story very well and that they have the right expectations when it comes to us. That's the main difference. Everything else is the same.

• 27:51Harry Stebbings?

  The thing that I always think about and feel for public market CEOs on is like, how do you balance between hitting next quarter's numbers as Wall Street expects? And also having long-term thinking, strategic planning and investing for the long term whilst also hitting the short term? How do you balance between the two?

• 28:06Speaker 02

  Yeah, so you balance between the two by really focusing on the long term and making sure That you have the right investors on board. I mean, you can't control all the investors you're going to have. You can't control what happens to your stock after a given quarter. And as a high-growth company, there's going to be a lot of volatility in your stock anyway. So my take on it is you just give up on that part because it's not within your control. You focus on the long term and everything else will follow. You know, there's this famous quote about the stock market, you know, like in the short term, there are voting mechanism. And in the long term, there are weighing mechanism. And you just have to remember that if you do your job, if you grow the company long term the right way, everything else will follow.

• 28:41Harry Stebbings?

  Can I ask, was there anything surprising about the IPO process? The process itself is kind of shrouded in kind of mystery and opacity. Like you see people ringing the bell and you go, wow, that's great. But the process itself, not many people know about, like, was there anything surprising for you?

• 28:54Speaker 02

  I think the process might be changing quite a bit right now, actually. There's new ways to go public and you don't have to do roach row anymore and all that stuff. But the thing that I realized throughout the process was that it's not really about the day of the IPO. Actually, nobody cares about what happens the day of the IPO. I mean, it's a very moving moment. I would remember that all my life, obviously. And it's great to see like we had a hundred of our earliest employees on stage at NASDAQ for that. It was very moving. But it doesn't really matter all that much in the end. What matters is the relationship you started building with all these public investors. And those relationships will play out in the years that follow, not on that day. And many of them, actually, even the long, the good long-term investors, like they buy into your IPO. And they flip it right away because they've made, you know, forty percent in one day. And that's good enough for them and then they come back later.

• 29:37Speaker 02

  So you have to see it as the beginning of a long relationship with those investors.

• 29:40Harry Stebbings?

  Do you mind that, like the buy and flip?

• 29:42Speaker 02

  Yeah, well, you can say whatever you want about it, it just happens. So you have to be at peace with it. I think that's why you see now some of the new mechanism for going public, you know, that maybe alleviate some of that. But I think the space is going a little bit crazy right now. So we'll wait a few years to see exactly what the new way of going public is.

• 29:57Harry Stebbings?

  Ollie, I think just spending time with you, I'm becoming a karma influence. So it's a good influence on me. Final question before we move into the quick fire. Obviously with IPOs and with liquidity events, personal wealth changes. And one that I think about intensely for myself is like, you know, relationship to money. How do you think about your relationship to money? Has it changed over time?

• 30:16Speaker 02

  What I'll say is as a starter, like money is not the big driver for me and. If in two thousand ten you're starting a monitoring company, that's not really a get rich quick kind of scheme. And that hasn't changed, like that's still very much your case. One thing, though, that I found to be extremely satisfying is to see a number of data dog employees, like early employees and important employees who became very successful financially throughout the growth of the company and the IPO. And that's super gratifying. I mean, give you an example of one employee who's an immigrant, whose parents lived in a seventh floor workup, something like that. And at IPO time, he bought an apartment for their parents in the building with an elevator. So that's the kind of things that make me super proud. And today, I feel that my mission is actually to make sure that the newer employees,

• 30:58Speaker 02

  people who have joined us last year and who join us now, find the same level of success as we keep basically delivering on the same growth.

• 31:03Harry Stebbings?

  Can I ask, with children, is it tough to inspire that same level of hunger and appreciation when maybe brought up in very different wealth conditions than you are and a lot of people are?

• 31:14Speaker 02

  My son is less than two years old, so it's too early to tell.

• 31:16Harry Stebbings?

  T B D.

• 31:17Speaker 02

  Yeah, but that's obviously a concern for everyone, right? I think you want to give your children the good things you've had, you know, when you were growing up. And I think, you know, curiosity and drive, these are good things. You want them to have that and empathy, and you don't want them to lose that because of their situation.

• 31:32Harry Stebbings?

  Last one, I promise, for the quick fire, but how did having your son and becoming a father, how did it change your operating mentality?

• 31:38Speaker 02

  I think the one thing it does change is you have to be even more disciplined about time management. Because when you get young children, your time is not yours anymore. So I had to have even more rigor with that. You can't just, if you don't manage your time well during the day, you can't just make up for it in the evening or on the weekend. Like, you actually have to be very good at managing your time. Aside from that, I mean, look, it's a joy to have young children, so maybe I'm in a better mood now, I don't know. We'll have to ask the rest of people at Data Dog.

• 32:01Harry Stebbings?

  It's lovely to hear, and clearly I need to improve my time management before I have kids. But I do want to move into the quick fire round, so I say a short statement and then you give me your immediate thoughts. Does that sound okay?

• 32:10Speaker 02

  Sure, that works.

• 32:11Harry Stebbings?

  Okay, so we don't like business books, but what's the favourite book and why?

• 32:15Speaker 02

  I don't have a favourite book, but I would appreciate anything by Code One Good. And that's because it's very whimsical and I really enjoy whimsical writing.

• 32:23Harry Stebbings?

  What's the hardest element of your role with Data Dog today?

• 32:26Speaker 02

  It was really to balance short term and long term. On a day to day basis, it's fairly hard.

• 32:30Harry Stebbings?

  Yeah, absolutely. How do you deal with the real shit hit the fan moments? Are you a runner? Are you a meditator? What do you do when times are really tough?

• 32:38Speaker 02

  Well, try to take a deep breath. Actually, it's a great point. Like, you know, when you're really stressed out, taking a run is a really good thing. That actually takes a lot of the stress out and it helps you think more clearly.

• 32:47Harry Stebbings?

  Tell me, biggest challenge of building and running a business in New York?

• 32:50Speaker 02

  Well, in New York, you're competing with so many other things. Like, you're competing for talent, you're competing for space, at least you used to, you know, for office space. You're competing for attention with a million other things. That's also what makes the city attractive, but that means you have to be out there and you have to pitch all the time.

• 33:04Harry Stebbings?

  What three traits would you want your children to adopt?

• 33:06Speaker 02

  Well, we touched on that briefly before, but curiosity, empathy, I think these are the keys to happiness. If you have all of that, I think you're all set. And by the way, not to be paternalistic, but you know, when we look at employees, these are also fantastic qualities that mean people are going to grow a lot, you know, if they're curious. They show empathy with their customers and fellow data dogs, and they have the drive and the grit to keep going.

• 33:25Harry Stebbings?

  Tell me, who are your biggest mentors and why?

• 33:28Speaker 02

  So I don't have any specific special mentor. I think the people that I appreciate the most are the one who have really fine, great understanding of the business to give me really pointed feedback based on what they see as opposed to no generalities again.

• 33:41Harry Stebbings?

  And then tell me, final one, what are the nice five years told for you and Data Dog? What does that picture look like?

• 33:47Speaker 02

  What I'm hoping for is first, a lot of fun, because otherwise you shouldn't do it. Uh, second, a ton of building. I'm excited about building, building products, building companies, building processes for the companies. And then obviously for our employees and investors alike, like mountains of growth. Like, we think we're so early in what's a very large market and a, you know, a shift, really the shift to digital economy and to the cloud. It's only happening once or twice a century, so we are really excited about that.

• 34:11Harry Stebbings?

  Ollie, as I said, I feel phenomenally calm and that, like I've learned a huge amount from you in this school. So thank you so much for joining me and this has been a lot of fun, Stu.

• 34:19Speaker 02

  Right, thank you.

• 34:22Harry Stebbings?

  I do want to say again a huge thanks to Ollie. Such an incredible journey with Datedog and some very, very exciting times ahead. If you'd like to see more from us, you can of course find us on the site at the20minutevc.com. I always love to see you there. But before we leave you today, I have to say I just love using AngelList's Fund Admin Platform to manage my investments. The team and platform at AngelList takes care of all my back office needs so that I can focus on working with great founders. Leading fund managers have made over 10,000 investments into 6,000 startups via AngelList, all online and all in one place. And with the recently announced Rolling Funds, you can easily find and invest in these top fund managers on angellist.com/rolling. And speaking of incredible customer experiences there with AngelList, Mercury is building full stack banking for startups.

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• 35:48Harry Stebbings?

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