20VC: YC's Ali Rowghani on Leadership Lessons From Steve Jobs, Ed Catmull and Jack Dorsey & The 3 Traits All Truly Successful Leaders Share

Ali Rowghani is a Partner @ Y Combinator, the world’s most successful accelerator with portfolio companies including the likes of AirBnB, Dropbox, Stripe, Zenefits, Twitch, the list goes on. At YC, Ali leads the Continuity Fund where has made investments in the likes of Segment, Convoy and Lob, where he also sits on the board of all 3. Prior to investing with YC, Ali spent 4 years at Twitter, starting as CFO before becoming COO. Whilst at Twitter, Ali saw the company scale from $0 revenues to over $2Bn and 20m users to close to 300m users. Before Twitter, Ali was the CFO @ Pixar Animation Studios. In Today’s Episode You Will Learn: 1.) How Ali made his way from CFO @ Pixar and COO @ Twitter to now leading YC's continuity fund? 2.) Ali describes a story of his time at Pixar working with Steve Jobs? How did he carry himself both as a leader and an operator? What was it about Steve that makes Ali say he is the most impressive exec he has ever worked with? 3.) Having seen the likes of Steve Jobs, Ed Catmull, Jack Dorsey in action what have been Ali's biggest takeaways with regards to what makes the truly great leaders? Why does Ali believe there are 3 traits all great leaders share? What are they? 4.) How does Ali look to bring that experience to his role now, investing with YC Continuity? How does that affect his mindset and evaluation when assessing investment opportunities today? 5.) Why does Ali believe that too many startups have been damaged by the amount of capital they have raised? As a former CFO, how does Ali analyze the capital being raised today and some of the burn rates in the valley? Items Mentioned In Today’s Show: Ali’s Fave Book: Theodore Roosevelt by Edmund Morris Ali’s Fave Blog: Bill Gurley: Above The Crowd Ali’s Most Recent Investment: Segment As always you can follow Harry, The Twenty Minute VC and Ali on Twitter here! Likewise, you can follow Harry on Snapchat here for mojito madness and all things 20VC. Lattice is the #1 performance management solution for growing companies. With Lattice, it’s easy to launch 360 performance review cycles as often as you want. And you also get a continuous feedback system with OKR goal tracking, real-time feedback, and 1-on-1 meetings to make sure employees get feedback between reviews. Find out why the likes of CoinBase, PlanGrid, Birchbox and WePay trust Lattice as their performance management solution by heading over to lattice.com to start investing in your people. That’s Lattice.com. Recurly, the company powering subscription success, with Recurly’s enterprise-class subscription management platform providing rapid time-to-value without requiring massive integration effort and expense and they have the ability to not only increase revenue by 7% but also reduce the all-important churn rate. That is why thousands of customers from Twitch to HubSpot to CBS Interactive trust Recurly as their subscription management platform. Check them out on recurly.com that really is a must.

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

• 0:00Harry Stebbings?

  You are listening to the 20 Minute VC with me, Harry Stebbings. You can find me on Snapchat at H Stebbings with two Bs to see all things behind the scenes with us. But to this week on the show, and I'm very, very excited to be doing a feature week on the world's most successful accelerator, Y Combinator, the organisation behind the likes of Airbnb, Stripe, Reddit, Dropbox and many more incredible companies. So joining us in the hot seat today, I'm thrilled to welcome not only a very special man, but a man who's had a front row seat for the creation of some truly game-changing companies of the last decade, Ali Rowghani, CEO of the YC Continuity Fund, where he's made investments in the likes of Segment, Convoy and Lob, where he also sits on the board of all three companies. And prior to investing with YC, Ali spent four years at Twitter, starting as CFO before becoming COO. Whilst

• 0:44Harry Stebbings?

  at Twitter, Ali saw the company scale from $0 in revenue to over $2 billion and 20 million users to close to 300 million users. And before Twitter, Ali was the CFO at Pixar Animation Studios, one of my personal favourites. And I do also want to say a big thank you to previous guest Sasha at LendUp for the intro to Ali today, without which this episode would not have been possible. But before we move into the show today, if you're a founder or operator, your most important job is people operations, whether that be hiring execs, developing managers or retaining top talent. And that's why you need Lattice. Lattice is the number one performance management solution for growing companies. With Lattice, it's easy to launch 360 performance review cycles as often as you want. And you also get an incredible continuous feedback system with OKR goal

• 1:27Harry Stebbings?

  tracking, real-time feedback and one-on-one meetings to ensure employees get feedback between reviews. So find out why the likes of Coinbase, PlanGrid, Birchbox and WePay trust Lattice as their performance management solution by heading over to lattice.com to start investing in your people. That's lattice.com, the number one performance management solution for growing companies. And speaking of number one there, you must check out Recurly, the company powering subscription success with Recurly's enterprise class subscription management platform, providing rapid time to value without requiring massive integration effort and expense. And they have the ability to not only increase revenue by 7%, but also reducing the all-important churn rate. And that's why thousands of customers from Twitch to HubSpot to CBS Interactive

• 2:09Harry Stebbings?

  trust Recurly as their subscription management platform. And you can check them out now on recurly.com. That really is a must. But enough from me, so I'm now very excited to hand over to Ali Rowghani, CEO at YC Continuity Fund.

• 2:27Speaker 01

  You have now arrived at your destination.

• 2:30Harry Stebbings?

  Ali, it's a huge pleasure to have you on the show today. A big thanks to Sasha at LendUp for the intro, but thank you so much for joining me today, Ali.

• 2:37Speaker 02

  Oh, it's my pleasure. Thank you for having me.

• 2:39Harry Stebbings?

  I mean, the pleasure's all mine, Ali, but I'd love to start today with a little bit about you and how you made your way into early-stage investing and now venture with YC.

• 2:47Speaker 02

  Well, actually, there's a lot of serendipity. I never set out to be a venture capitalist or even prior to joining YC was that my goal. I really spent my career as an operator and I had the really good fortune to work at two iconic consumer technology companies. The first was Pixar, the animation studio, and the second was at Twitter. And I spent almost 10 years at Pixar and five years at Twitter in a variety of roles. And I had the good fortune in both places to see those companies scale from fairly small businesses to kind of much larger businesses. In the case of Twitter, I joined when the company had about 100 employees. We had, I think, 15 million users, 25 million tweets created every day. We had no revenue. We had no mobile products. It was just twitter.com.

• 3:32Speaker 02

  We had no mobile engineers, no mobile engineers, believe it or not, at the time I joined. And we had one office in San Francisco and that was it. And when I left about five years later, we went from no revenue to $2 billion in revenue. We went from 100 employees to 2,500 employees. We went from 25 million users to 300 million users or close to 300 million users. We went from one office in San Francisco to 23 offices in 14 countries. And we went from no mobile products and no mobile engineers to 80% of our usage was on mobile. It was an incredible period of growth and change, kind of a period of hyperscaling. And I learned an incredible amount through that experience. It was kind of like sprinting up Mount Everest, I like to say. So when I left Twitter,

• 4:17Speaker 02

  I left about nine months after the IPO and it was still a sort of a high-flying stock at the time. Hopefully, I'll get there again. But I really didn't have an intention to become a venture capitalist, despite the fact that I had a huge amount of respect for the great people in the industry. I just wanted to be an operator again and I thought I'd take some time to catch my breath. And wait for the right opportunity to come along. And during that pause, Sam Altman, who runs Y C, approached me and asked, hey, would you be willing to serve as an advisor to Y C? He said that we have now hundreds of companies that are in various stages of scaling. And he thought that my experience would be helpful to them. So it was kind of a no brainer. I was sure I'll I'll help. And I got involved and that was in the fall of two thousand fourteen, winter of two thousand fifteen.

• 5:01Speaker 02

  And I really enjoyed spending time at Y C. For me, it was the closest thing to a university for startups that we have. All of these startups, you know, join our program with their new ideas and their optimism. And all of them having a desire to make a dent in the universe. And it's just such a privileged environment to work in. And so I really enjoyed it. And six months later or so, Sam approached me again and said, you know, Y C wants to raise a later stage investing fund to do follow on investments in its own companies. You know, would you be willing to lead that? And kind of came as a surprise. And I asked him, you know, why would you choose me? And he said, we already have great relationships with the Y C companies. We've already invested in all of them.

• 5:43Speaker 02

  So we don't think this is a job of like going out and doing an incredible job of sourcing as most V C's have to do, but rather it's about convincing them that Y C has more value to add as they start to scale. And given your your experiences, we think you are the right person. So when he said that, I just realized that this was a pretty unique opportunity, mainly because it was connected to Y C. An opportunity for me to be both an entrepreneur on the one hand, to try to build an investing practice on top of a differentiated platform in Y C, and also an opportunity to be an investor. So, you know, in that kind of interesting way, because Y C is so different than a venture capital organization or venture capital firm, even though we do invest, I think we just do our job in a very different way.

• 6:28Speaker 02

  In many ways, I don't really feel like a V C, despite the fact that I'm an investor. And that's not to denigrate anyone in the field or the profession. I have a huge amount of respect for the for the quality of of professionals that are active in the industry. It's just to say that Y C is kind of a different bird.

• 6:44Harry Stebbings?

  We dive into all things Y C. Being the diligent interviewer that I am, I spoke to many of your founders and Peter at Segman said, Harry, I know you're British and like to talk, but Ali has some incredible stories. So I want to start with that and I'll let you choose, but let's do a story from Twitter and a story from Pixar.

• 7:00Speaker 02

  Sure. You know, actually what pops to mind is two stories from Pixar that hopefully your audience will find interesting. So if you wouldn't mind, I'll just tell you two stories from Pixar.

• 7:08Harry Stebbings?

  Absolutely. I'd love that.

• 7:10Speaker 02

  Okay, great. So the first, I'm asked a lot to tell stories about what it was like to work with Steve Jobs. He was the Pixar CEO and had the good fortune to work very closely with him during a phase of my career. And he was hands down the most impressive executive inside a room that I've ever been around. But the story I wanted to tell you was the first time I actually presented to him. And it was about a year after I joined Pixar, so back in 2002, 2003. And I had done some research and made a presentation about Pixar's long-term plan. You know, at the time they were making one movie every two to three years. And they had the ambition to get to the point of making at least a movie a year or even more than a movie a year if they could. And so I, just out of curiosity, I started kind of analyzing their plans and you know, how they were going to get there.

• 7:54Speaker 02

  And I found some what I felt were like flaws in how they were thinking about that challenge. And so I put together a presentation, I showed a group of the leadership of the company. And Ed Catmull was the day-to-day leader of the company, was the president of Pixar and the founder of Pixar. But Steve was the CEO. Steve was also the CEO of Apple. And so he was only spending a day a week usually at Pixar. So Ed had seen my presentation, he said, Steve has to see this. Can you present it to him on Friday? And I said, okay, sure. And I was a relatively junior guy at the time, you know, I hadn't had any interaction with Steve face to face. And so I started to sort of polish my PowerPoint presentation in preparation for Steve. It was about 30 slides and the night before I was kind of working 5:30, 6 o'clock in my office, putting the final touches on the presentation. And Ed Catmull swings by my office and says, so are you ready for tomorrow?

• 8:39Speaker 02

  And I said, yep, I'm just practicing and putting the final polishes on this thing and I'll be ready. And he was on his way home and he said, okay, great. Well, I'll see you tomorrow. I said, see you tomorrow, Ed. And then quickly he ducks his head back in my office and says, actually, can you make sure that the presentation is in keynote? And I thought keynote. What's that? And he said, oh, it's Apple's version of PowerPoint. And it's pretty important to Steve that you're presenting on keynote and not PowerPoint. And I thought, okay. I said, Ed, I don't have the software on my machine. And he said, oh, just run downstairs to IT. They'll put it on and don't worry. You know, you can take your PowerPoint presentation. There's a button in keynote that you push and it converts the entire presentation into keynote from PowerPoint and you'll be all set. And I thought, okay. So I ran downstairs to IT. It's now about probably six o'clock, six fifteen. You know, the last IT person is packing up to go home. And I said, wait, wait, wait.

• 9:24Speaker 02

  Please install keynote on my computer. I'm presenting to Steve tomorrow. And he says, oh, okay, okay. So, you know, he installs the software and by about six thirty, six forty five, I have the software on my machine and I go back upstairs, pack up my things and head home. I go home, I have dinner and then I turn on my laptop with my keynote, my PowerPoint presentation, and I push that button that edit reference to transition the presentation from PowerPoint to keynote and everything shatters. All of the work that I'd done, all of the slides that I'd meticulously built, all of the animations that I'd put into the slide, everything was in tatters. And so I had to go on the internet, learn how to use keynote and basically reassemble the presentation slide by slide in software that I'd never-

• 10:04Harry Stebbings?

  I'm crying for you right now.

• 10:06Speaker 02

  Yeah, in software that I'd never used before. And so I finished, it's about, by this time, two thirty, three in the morning. I'd finally put it together. I'd, you know, clicked back through, built the animations, et cetera. And Harry, I tell you, when I was done, it looked indistinguishable from the presentation that I'd had in PowerPoint six hours earlier. And I was so mad at myself and so mad at Ed for giving me such terrible advice to like basically do this monkey work, to convert this one presentation from PowerPoint to keynote and have it look absolutely indistinguishable to what I'd started with. I thought it was some test of my endurance. So the next day, it's time to present and it's about three o'clock in the afternoon and Steve is running about 10 minutes late. And I never saw Steve ever carrying anything except a bottle of water.

• 10:49Speaker 02

  He never had a bag or papers or anything and he always moved very quickly. And so the room was full, all the executives at the company were there and I was standing in front and the presentation was projecting behind me. And Steve suddenly kind of comes around the corner, holding a bottle of smart- And he looks at me and he had a very distinctive glare, a very intense look about him. And he looked at me, glared at me, looked at the presentation. He looked back at me, he looked back at the presentation and he looked at me and said, keynote? And I looked over at Ed and Ed's looking sheepishly at me. And I looked back at Steve and I said, of course. And he said, how did you like it? And I said, Steve, I loved it.

• 11:29Speaker 02

  And the intense glare in his eyes sort of dissipated. He started smiling and he walked over, pulled the chair back and sat down. And I looked over at Ed and I thought, oh my God, Ed, I could kiss you right now.

• 11:42Speaker 02

  You helped this presentation get off to such a good start. So that's a Steve Jobs story. The other story I'll share is a little more sentimental. I'll try to keep this brief. When I joined Pixar, we had a distribution deal with Disney. And as part of that deal, Disney had the right to make sequels to Pixar films. So Disney had the right to make the sequel to Toy Story three, which was an incredible. I can't exaggerate what an emotional issue that was for the Pixar folks. That Disney was producing Toy Story three and they weren't. But you know, they thought of the films as their children, their creative product. And they really wanted to make the sequel to Toy Story three themselves. So fast forward a few years, we sold the company to Disney in 2006. And as part of that transaction, Disney naturally closed down their own production efforts on Toy Story three and gave the film back to Pixar. And so Pixar put Toy Story three into production.

• 12:27Speaker 02

  The original gang of creators who made Toy Story one got together. They had their offsite and brainstorm. They hired a very talented writer named Michael Arnt to write the first version of the script. And then after years of waiting, Toy Story two, I remind you, came out in 1999. And Toy Story three came out in 2010. So after a very long wait, finally in about 2009, we were, or 2008, we were reading the first draft of the Toy Story three script. And the way they did it is called a table read. A group of creative leaders and executive leaders were sitting around a table. And everybody was, a different person was reading each of the parts. So somebody was Buzz Lightyear and somebody was Woody and so on and so forth. And it was great fun, you know, they went through the script and it was heartwarming and funny, et cetera.

• 13:12Speaker 02

  And it reaches the end of the script. Scene where Andy's grown up, he's going to college and he's giving his toys away to a little girl so that she can enjoy them. And as he starts to give Woody away, who's his favorite toy, as I'm listening and reading the script along with the actors, all of a sudden I feel myself tearing up and like tears kind of coming down my cheeks. And I thought to myself, God, how silly that I am crying while reading this script. I can't believe this. I'm such a kid. And then I wiped the tears away and I look up at the rest of the company leadership, basically sitting around me. And everyone was crying and it's a memory I'll always take with me. And it really, more than anything, told us that we had a great film on our hands.

• 13:53Harry Stebbings?

  No, I completely agree. I remember crying at the movie when I saw it, but I do have to ask, you mentioned some incredible names there from Steve Jobs to Ed Catmull to working with Jack at Twitter. So I do have to ask, what were the takeaways, obviously apart from Steve's attractive glare, in terms of their operations? And really what it takes to be a great leader?

• 14:09Speaker 02

  Yeah, I think the biggest lesson that I took is that there's not one formula to being a great leader. All of the folks that you just mentioned and other great leaders like Jack Dorsey or Bob Iger, et cetera, that I've had the privilege to work very closely with. They're all so different. I think the lesson there is that if you aspire to be a great leader, you can't seek to copy Steve Jobs or anyone else in your quest to be a great leader. You have to be yourself. But having said that, having observed the diversity of styles and approaches and demeanors of great leaders, there are, I think, three fundamental traits that all great leaders share. And I've thought a lot about this. I have actually written a blog post about this called How Do You Measure Leadership?

• 14:47Speaker 02

  But the three traits that I think are fundamental are, number one, great leaders all share an incredible clarity of thought and communication. And the reason that's important is you have to describe a compelling vision of the future that other people can understand, get excited about and follow. And so if you can't do that, or if it's muddled, or it changes, then you know, it's very hard to lead. The second is great leaders have exceptional judgment about people. They choose the right people to work with them. They choose the right people to give authority to. And if you make the wrong decisions, if you have bad judgment about people, it's very difficult to lead an organization. And then finally, great leaders. Have exceptional personal integrity and commitment. Building a company or leading an organization is very, very hard.

• 15:31Speaker 02

  And there are going to be ups and downs always. And what really helps you overcome those and have people follow you, continue to follow you, stay loyal to you despite challenges is a core integrity and commitment that you show to the cause. So I think those three things are fundamental, but everything else can change.

• 15:48Harry Stebbings?

  I do have to ask then, how do you think with that experience and knowledge that affects how you evaluate and analyze founders now on the other side of the table as a VC with the Continuity Fund?

• 15:59Speaker 02

  You know, I think assessing the quality of a leadership team and the quality of a CEO is pretty fundamental to this job. You know, I described those three characteristics that I think all great leaders share. And when you're evaluating a team of entrepreneurs, I think those same three criteria are important. I think it's very important that an entrepreneur be able to describe in a compelling, concise, clear way, what is the problem they're trying to solve and why? And how does their approach, what is their unique perspective on the universe or their customer that they see that other people don't see that they intend to solve? It's very important to evaluate how their skill at evaluating people and hiring and building a great leadership team around them. And that really comes down to their judgment about people. And finally, when we make an investment at the YC early stage or at a later stage,

• 16:44Speaker 02

  you know, these are very long-term relationships that you have with founders. And, you know, as I mentioned, there's going to be all sorts of ups and downs and hardships to overcome. And so assessing the integrity and personal commitment of an entrepreneur is also really critical. So I think those are, as I look at it, three pretty crucial things to evaluate when you're evaluating the quality of the team. And then later on, after you invest, these are also areas that you can help people kind of get better in these areas.

• 17:11Harry Stebbings?

  Now, I'm really pleased you said about getting better there because in the world of deep tech, often it's the case that maybe more scientific-based founders sometimes lack those leadership skills and personal skills previously mentioned. So I'd love to hear how you think about that, especially in relation to deep tech, scientific-based founders.

• 17:27Speaker 02

  You know, one of my core beliefs is that everyone can get better as a leader. And I think that it's certainly true that some people are blessed. With some natural characteristics or some natural things that they're comfortable with. That makes it easier. But as I mentioned, one of the inspiring things about the observation that great leaders are very, very diverse. There's not one formula to being a great leader. What that means is that we all actually have the capability to be great leaders. I do believe that. If you're an extrovert or an introvert, if you are very vocal or if you're not, if you prefer verbal communication or written communication, I think that as long as you can excel at the three things that I mentioned, clarity of thought and communication,

• 18:09Speaker 02

  your ability to judge people and your commitment and integrity to a cause. And those are all things that you can work on. You know, I mean, just to choose one example, judgment about people. Every leader, no matter how good, makes hiring mistakes. But there's a lot of things that you can do in making a hiring decision to improve your odds and to get better and better so that your success rate improves over time. As an example, you know, I know founders who, for instance, have never hired a CFO before. And before they launch their CFO hiring process, they will make it a point to meet the five best CFOs that they can be introduced to, not to recruit them, but to just get a sense of the texture of what that great CFO kind of looks and feels like. So that they've improved their sense of judgment when it comes to evaluating a CFO for their own company.

• 18:54Speaker 02

  In each of these areas, there are ways that someone can improve. And so I don't really disqualify anyone from being able to become a great leader.

• 19:03Harry Stebbings?

  No, I absolutely love that. But I do want to discuss, before we move into the quickfire round, an element of transition, moving from operator to VC. So talk to me, Ali, what's been the biggest challenge about making the transition from operator to VC for you?

• 19:15Speaker 02

  You know, I think the biggest challenge is as an operator, almost every decision you make, you can either test at small scale to see if it works or reverse it if it doesn't work. And as an investor, once you've made an investment, there's really no reversing it. There's no such thing as trying it in small scale. You know, it's more of a binary decision. It's almost like being a hunter. If you're hunting for deer and once you decide to shoot a deer, like it's sort of over. You've shot the deer and you can't test that in small scale now. Hunting and investing are different in many, many ways, but the sort of finality of the investing decision and your inability to test things at small scale or undo them, I think is probably the biggest challenge that I've encountered anyway.

• 19:56Harry Stebbings?

  On the alternate side, what about the biggest surprise about the move to VC? Maybe one that's not obvious unless you're in VC.

• 20:02Speaker 02

  I would say the biggest surprise is the time gap between making a decision to invest and realising if that decision was a good decision. It takes time for companies to grow and mature. And as a funny analogy, if you play billiards, I sometimes feel like being an investor is like taking a lot of time lining up your shot and then it's lined up perfectly. You're happy with it, you strike the cue ball and then you have to turn your back and come back in a few years to see if the ball went in. And that's been a surprise for me.

• 20:30Harry Stebbings?

  Yeah, no, it's probably the biggest challenge for me, but I would love to move into a quick firearm with you now. I say a short statement and in 60 seconds, you give me your immediate thoughts. How does that sound?

• 20:40Speaker 02

  Sounds great.

• 20:41Harry Stebbings?

  So your favourite book and why? What must I be reading, Ali?

• 20:44Speaker 02

  You know, honestly, I'm sort of nerdy here. I love biographies and I love biographies sometimes of historical people because I feel like you learn a lot from the hardships that they endured and how they sort of overcame them. And the one that comes to mind is, there's a great three-part biography of Theodore Roosevelt. And I like the first one the best, The Rise of Theodore Roosevelt by Edmund Morris. He just led such an incredible life and overcame such incredible hardship that I would say that's the one that comes to mind.

• 21:10Harry Stebbings?

  I'm glad we share a historical biographical love. One to recommend would be Winston Churchill's, fantastic one.

• 21:16Speaker 02

  Yes, you mean the Manchester ones?

• 21:17Harry Stebbings?

  Yes, absolutely.

• 21:18Speaker 02

  Yeah, I agree.

• 21:19Harry Stebbings?

  And then what do you believe that most around you disbelieve?

• 21:22Speaker 02

  You know, it's funny, I'll have to, in a way, this is sort of Pixar thinking and I haven't tested this as much in the venture world, but in Hollywood, in the filmmaking business, I think one of the things that's very differentiated about Pixar and what I also deeply believe is that a great team is more important than a great idea. And I think in Hollywood, like everyone's chasing scripts and ideas and this, that and the other thing. And Pixar is just focused on the quality of the team that it's able to put together. The idea being a great team will, you know, fix an idea that's mediocre or throw it out and come up with a better one. And I think in the venture business, sometimes there is maybe a little bit too much of a focus on the idea, the product, the market opportunity and maybe not enough of an emphasis on the team. So that's what I would say.

• 22:03Harry Stebbings?

  The biggest mentor to you and how did that relationship come about?

• 22:06Speaker 02

  Professional mentor, I would probably say Ed Catmull, who is the founder and president of Pixar. I worked very closely with him for five years. He was my boss and I refer to him sort of as a national treasure. He is such an incredible leader, but also such an unusual leader and such a humble and grounded human being. I learned a lot from him.

• 22:24Harry Stebbings?

  Favorite blog or newsletter? What are the must reads when they come in?

• 22:27Speaker 02

  You know, I like, I like a lot of the writing that Bill Gurley has done. I think it's called View From The Top. I'm not sure.

• 22:33Harry Stebbings?

  What would you most like to change in the world of VC and startups? You now have experience from both sides. What would you most like to change?

• 22:40Speaker 02

  You know, I think one of the unfortunate things that things has happened in our industry is there are many startups that actually I think have been damaged simply because of the amount of capital that they've been able to raise. You know, I was a CFO earlier in my career and you need enough capital to be able to take risks and make mistakes, et cetera. But I think if you have too much capital, it saps a company of urgency, of energy. It makes the company more lazy, et cetera. Until the point where you're able to build the maturity and the structures and the governance and the leadership, et cetera, they can kind of deal with that. So if there's one thing I could change, I think, is I would want companies to be more careful about just swelling their balance sheets with too much capital, especially early on.

• 23:24Harry Stebbings?

  And then tell me, tell me about a recent investment and why you said yes.

• 23:28Speaker 02

  Sure. You know, you mentioned Segment and Peter Reinhardt. This was a recent investment we made. We, we really love the team first and foremost. Peter and his two co-founders, Ilya and Calvin, you know, they're creating a new product category and they're the leader in this new product category, this customer data platform. And it resides at a very strategic layer of the analytics stack. And there's a longer term possibility as they continue to build out the product of a developer platform on top of Segment and Segment Data. So it was a rare combination of factors in terms of the team, the strategic positioning and the potential in the future that got us extremely excited about Segment.

• 24:04Harry Stebbings?

  Ali, as you can tell, I've so enjoyed having you on the show today. So thank you so much for joining me.

• 24:09Speaker 02

  My pleasure. Thank you again for having me.

• 24:13Harry Stebbings?

  What an incredible guest, that really was a very special episode for me to record. And if you'd like to see more from Ali, you can follow him on Twitter @Ralgani. I do want to say again, a huge thanks to him for giving up the time today to appear on the show, and a big hand to Sasha at LendUp. This show would not have been possible without his instruction, so we really appreciate that. And if you'd like to see more from us, you can follow us on Snapchat @HStubbings with two Bs, it'd be fantastic to see you there. But before we leave you today, if you're an early-stage startup, the right infrastructure and support systems are critical, and that's where First Republic is so good. First Republic's resources, network and expertise allow entrepreneurs to customise a solid foundation for your business across all stages. So why First Republic? Well, you get to leverage their incredible network of VC firms to prepare you for future fundraising events.

• 24:56Harry Stebbings?

  You get to count on a single point of contact that will be there for you and your employees when you need them. You get access to exclusive events and networking opportunities. But don't trust me on this, their clients include the likes of Instacart, EShares and Wish, just to name a few. Check it out by heading over to innovation-firstrepublic.com. And speaking of incredible startups there, one that really is a must is Segment. Why? Well, Segment allows you to collect data from every platform, mobile, web, server, cloud apps, and load it into Segment. Segment then sends the customer data to your tools and destinations, where it can be used most effectively. Destinations include email, analytics, warehouses, help desks. And with over 200 sources and destinations on the Segment platform, that can really empower your team. Segment really is the last integration you will ever do, and that's why the world's

• 25:41Harry Stebbings?

  best companies use Segment to drive growth and revenue, including the likes of Atlassian, New Relic and Crate and Barrel, just to name a few. Simply head over to segment.com to find out more. As always, we so appreciate all your support, and we cannot wait to bring you Wednesday's episode with Paul Buchheit, partner at Y Combinator and creator of Gmail.