Behind the founder: Drew Houston (Dropbox)

Drew Houston is the co-founder and CEO of Dropbox. Under his leadership, Dropbox has grown from a simple idea to a service used by over 700 million registered users globally, with a valuation exceeding $9 billion. Drew has led Dropbox through multiple phases, from explosive viral growth, to battling all the tech giants at once, to reinventing the company for the future of work. In our conversation, he opens up about: • The three eras of Dropbox’s growth and evolution • The challenges he’s faced over the past 18 years • What he learned about himself • How he’s been able to manage his psychology as a founder • The importance of maintaining your learning curve • Finding purpose beyond metrics and growth • The micro, macro, and meta aspects of building companies • Much more — Brought to you by: • Paragon—Ship every SaaS integration your customers want: https://www.useparagon.com/lenny • Explo—Embed customer-facing analytics in your product: https://explo.co/lenny • Vanta—Automate compliance. Simplify security: https://vanta.com/lenny Find the transcript at: https://www.lennysnewsletter.com/p/behind-the-founder-drew-houston-dropbox Where to find Drew Houston: • X: https://x.com/drewhouston • LinkedIn: https://www.linkedin.com/in/drewhouston/ Where to find Lenny: • Newsletter: https://www.lennysnewsletter.com • X: https://twitter.com/lennysan • LinkedIn: https://www.linkedin.com/in/lennyrachitsky/ In this episode, we cover: (00:00) Introduction to Drew and Dropbox (04:44) The three eras of Dropbox (07:53) The first era: Viral growth and early success (14:19) The second era: Challenges and competition (20:49) Strategic shifts and refocusing (29:36) Personal reflections and leadership lessons (40:19) Unlocking mindfulness and building support systems (43:14) The Enneagram test (50:35) The challenges of being a founder CEO (58:11) The third era: Rebooting the team and core business (01:22:41) Lessons and advice for aspiring founders (01:27:46) Balancing personal and professional growth (01:42:38) Final reflections and future outlook Referenced: • Dropbox: https://www.dropbox.com/ • Y Combinator: https://www.ycombinator.com/ • Paul Graham’s website: https://www.paulgraham.com/ • Hacker News: https://news.ycombinator.com/ • Arash Ferdowsi on LinkedIn: https://www.linkedin.com/in/arashferdowsi/ • Sequoia Capital: https://www.sequoiacap.com/ • Pejman Nozad on LinkedIn: https://www.linkedin.com/in/pejman/ • Mike Moritz on LinkedIn: https://www.linkedin.com/in/michaelmoritz/ • TechCrunch Disrupt: https://techcrunch.com/events/tc-disrupt-2024/ • Dropbox viral demo: https://youtu.be/7QmCUDHpNzE • Digg: https://digg.com/ • Reddit: https://www.reddit.com/ • Hadi and Ali Partovi: https://www.partovi.org/ • Zynga: https://www.zynga.com/ • Steve Jobs announces Apple’s iCloud: https://www.youtube.com/watch?v=ilnfUa_-Rbc • Dropbox Carousel: https://en.wikipedia.org/wiki/Dropbox_Carousel • Dropbox Is Buying Mega-Hyped Email Startup Mailbox: https://www.businessinsider.com/dropbox-is-buying-mega-hyped-email-startup-mailbox-2013-3 • 5 essential questions to craft a winning strategy | Roger Martin (author, advisor, speaker): https://www.lennysnewsletter.com/p/the-ultimate-guide-to-strategy-roger-martin ... References continued at: https://www.lennysnewsletter.com/p/behind-the-founder-drew-houston-dropbox Recommended books: • Guerrilla Marketing: Easy and Inexpensive Strategies for Making Big Profits from Your Small Business: https://www.amazon.com/Guerilla-Marketing-Inexpensive-Strategies-Business/dp/0618785914 • Playing to Win: How Strategy Really Works: https://www.amazon.com/Playing-Win-Strategy-Really-Works/dp/142218739X • High Output Management: https://www.amazon.com/High-Output-Management-Andrew-Grove/dp/0679762884/ • Only the Paranoid Survive: How to Exploit the Crisis Points That Challenge Every Company: https://www.amazon.com/Only-Paranoid-Survive-Exploit-Challenge/dp/0385483821 • Zone to Win: Organizing to Compete in an Age of Disruption: https://www.amazon.com/Zone-Win-Organizing-Compete-Disruption/dp/1682302113 • Warren Buffett’s books: https://www.amazon.com/warren-buffett-Books/s?k=warren+buffett&rh=n%3A283155 • Poor Charlie’s Almanack: The Essential Wit and Wisdom of Charles T. Munger: https://www.amazon.com/Poor-Charlies-Almanack-Essential-Charles/dp/1953953239 • Invent and Wander: The Collected Writings of Jeff Bezos: https://www.amazon.com/Invent-Wander-Collected-Writings-Introduction/dp/1647820715/ • The 15 Commitments of Conscious Leadership: A New Paradigm for Sustainable: https://www.amazon.com/15-Commitments-Conscious-Leadership-Sustainable-ebook/dp/B00R3MHWUE Production and marketing by https://penname.co/. For inquiries about sponsoring the podcast, email [email protected]. Lenny may be an investor in the companies discussed.

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

• 0:00Lenny Rachitsky?

  People just don't realize the wild journey that you have been on over the past 18 years building this company. It feels like there's almost been these three eras of Dropbox. The first era of you're killing it.

• 0:10Speaker 01

  For the first several years, it was doubling, 10x-ing every year, putting like taping user counts that we printed out to the wall and then running out of space on the wall, having to put 100,000 users, 200,000, 500K, a million, 10 million on the ceiling.

• 0:22Lenny Rachitsky?

  And there's the second era, which is, I'll just say, everyone's trying to kill you.

• 0:26Speaker 01

  We started getting all the incumbents, Apple, Microsoft, Google, all of them launched competing products. But weirdly, it was sort of like, you see the videos where there's like the mushroom cloud in the distance, you see it, but you don't hear or notice it. But there is, it was also clear that winter was coming.

• 0:41Lenny Rachitsky?

  It feels like the year 2015 was a pivotal year where things started to shift.

• 0:45Speaker 01

  I'd start to hear kind of a louder set of critics inside and outside the company. Less than a year later, Google Photos launches, and not only does it provide a lot of the same value, but they also gave you free unlimited storage for life. And so they just totally nuked our business model.

• 1:01Lenny Rachitsky?

  You end up fighting wars on three or four fronts against the big kahunas that have infinite cash and can do whatever they want.

• 1:08Speaker 01

  So it killed Carousel, killed Mailbox, went all in on productivity. And I wish I could say like, then everything got better. It was the opposite, actually. The narrative completely flipped on the company. Suddenly, your employees don't want to wear your t-shirt anymore. Everybody's looking to you, was wondering like, how the hell did you get us in this situation?

• 1:27Lenny Rachitsky?

  Today, my guest is Drew Houston. This may be the most interesting and most useful episode of my podcast so far, especially if you're a founder, or if you someday want to be a founder. Drew shares the very real talk story of what it's been like to build Dropbox over the past 18 years, including the ups and especially the downs. He shares stories that he's never shared before, the struggles he's been through that very few people know about, what it's like to compete with big tech, how he's thinking about the future of the company, and also what he's learned about himself throughout the journey. This is a very special episode that I suspect founders will be studying for years to come. A big thank you to Drew for sharing these stories and lessons with us. If you enjoy this podcast, don't forget to subscribe and follow it in your favorite podcasting app

• 2:12Lenny Rachitsky?

  or YouTube. It's the best way to avoid missing future episodes and it helps the podcast tremendously. With that, I bring you Drew Houston.

• 2:22Lenny Rachitsky?

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• 3:07Lenny Rachitsky?

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• 3:52Lenny Rachitsky?

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• 4:36Lenny Rachitsky?

  Try it for free at xpl.co/lenny. That's E-X-P-L-O dot C-O slash Lenny.

• 4:47Lenny Rachitsky?

  Drew, thank you so much for being here. Welcome to the podcast.

• 4:51Speaker 01

  Oh, thank you, Lenny. It's great to be here.

• 4:53Lenny Rachitsky?

  I have been so looking forward to this conversation for so many reasons. One is, I feel like people just don't realize the wild journey that you have been on over the past 18 years building this company. You told me a few of these stories when we had dinner recently and I was just like, you need to come on the podcast and tell this stuff because I think it'll be really useful to a lot of people. And then also, I feel like you're just like a very real talk sort of founder that isn't afraid to share what's really going on. I think a lot of founders don't actually tell you the things they're going through. It's always like killing it. We're killing it all the time. So for all those reasons, I'm really excited to have this chat and this opportunity to sit down with you and hear these stories. So thank you again for doing this.

• 5:29Speaker 01

  Me too. And I've been a big fan of the podcast.

• 5:31Lenny Rachitsky?

  Oh.

• 5:32Speaker 01

  I learned a lot.

• 5:33Lenny Rachitsky?

  Oh, wow. I appreciate that.

• 5:36Lenny Rachitsky?

  The way I'm thinking we structure this conversation is as an outsider, it feels like there's almost been these three eras of Dropbox. And tell me if I'm missing something, but essentially it feels like there's like the first era of you're killing it, just up into the right, killing it, Dropbox is on fire. And then there's the second era that I think fewer people know about, which is, I'll just say, everyone's trying to kill you. All the incumbents are coming after you.

• 6:01Lenny Rachitsky?

  I like that. This is gonna be good. And then there's the current era, I'll say the third era of just rethinking what Dropbox could be. Does that sound roughly right as a good way to?

• 6:10Speaker 01

  I think that's right. Yep.

• 6:12Lenny Rachitsky?

  Okay, awesome. So let's start with this first era and spend some time here, which is, I think, the era most people know you for. There's like the big Hacker News launch, the demo video, the thumb drive you're always losing, the referral program everyone's always studying, like you're almost the epitome of viral growth. And so let's just talk about just things here that maybe people don't know about. Maybe some moments that are really important to you, memories that stand out to you. So maybe just start wherever you want to start about this time of the history of Dropbox.

• 6:41Speaker 01

  I mean, I started Dropbox because I, more out of just personal frustration and it really felt like something that only... I was super interested in as far as like file syncing and just really focusing on one customer, which is myself. And then, you know, the story of me forgetting my thumb drive on a trip to New York and things like that, and coding, I won't get into all that. But then, having a lot of, I had a lot of friends who were in Y Combinator and many friends who had like moved from Boston, where I was living, out to California and doing that whole pilgrimage, or kind of one-way pilgrimage. And feeling a little bit left out, but then also having this idea for Dropbox. And then, I think some of the most memorable things were the moments where Dropbox really felt like

• 7:24Speaker 01

  it was taking on a life of its own. Or maybe, maybe it like belonged to the internet and not so much to me anymore. So for example, we had a lot of success with these demo videos. First was just getting into Y Combinator. I made it, it sort of worked backwards from thinking about, you know, what's Paul Graham do all day? And my hypothesis was that he just like hits refresh on Hacker News like everyone else, like me, like everyone else.

• 7:46Lenny Rachitsky?

  This was you trying to figure out how to get Paul Graham's attention?

• 7:49Speaker 01

  Yeah.

• 7:49Lenny Rachitsky?

  I love that. What does Paul Graham do all day? Okay.

• 7:51Speaker 01

  Yeah. Well, because my first company was doing online SAT prep and, you know, I was like 21 when I started that. But in the world, there's a lot that Y Combinator has in common with college admissions. You have like a million people applying for very few spots. And the more you can get some kind of hook or find some kind of side door, that was the thinking. And I was like, all right, well, if I could put this, if I can create some kind of like viral video, put it on Hacker News, get Paul's attention, that'd be one way to do it. And that was an idea I'd read from, that was inspired by a book called Guerrilla Marketing, that I had read, which is basically how to do marketing if you have no money, which was a good fit for where we were. I say we, it

• 8:32Speaker 01

  was just me at the time. And sure enough, like I made this video, that was a, basically it's pretty straightforward, a screencast of Dropbox, showing it working on my computer. And then it hit the top of Hacker News for two days, which doesn't, I don't think it can really happen anymore. But sure enough, I got a note from Paul saying, hey, this is interesting, but you need a co-founder, which was a problem because it's sort of like, because it's clear that the YC application deadline... For the next cycle was maybe a week or two away. So Paul was basically sending me a helpful note that, you know, I know you're not dating anyone, but you need to be married in the next two weeks if you want to get into YC.

• 9:14Speaker 01

  So I ended up finding my co-founder Arash and, you know, there's just a ton of story after story like that in the early days. So I say the first chapter was, yeah, characterized by, you know, it just feels like one, one moment I'm sort of paddling in the ocean alone on a little board. The next, I'm just like a hundred feet off the ground on this tidal wave, um, trying to stay on.

• 9:32Lenny Rachitsky?

  How long does this period last of just like hacker news to something starts to change? How long is this kind of up into the right period?

• 9:39Speaker 01

  Uh, it was the first several years. So I started the company back in 2007. Um, I had just, uh, you know, I had been 24 at the time, moved to California. And so I'd say this first probably seven years, uh, from 2007 to 2014 were really that kind of crazy fever dream, you know, dot com experience where, uh, it's a blur. I mean, basically get into Y Combinator. Then it's like, okay, we need to, after we finish Y Combinator, that culminates in demo day and getting your first investors. And so we got,

• 10:10Speaker 01

  uh, uh, we got a person at Y, uh, demo day was this guy named Pejman Nozad, who's a angel investor who also owned, uh, a rug store in Palo Alto.

• 10:22Lenny Rachitsky?

  Oh, and he runs Pair.

• 10:23Speaker 01

  Yeah, and he runs Pair now. Um, he introduced to Sequoia. He came with us, um, to the pitch, which is, I, I learned later was unusual. You know, and that was on a Friday and then Saturday, Mike Moritz is in our apartment. Um, but anyway, so we were, we raised, uh, money from Sequoia and then we, we didn't, at that, and, and I was a seed round in 2007, so right after we finished Y Combinator. And then the base, basically you start with a pretty narrow circle of what you're working on. I mean, right in the beginning, it's just really just like coding and talking to customers. Um, but that circle kept expanding pretty rapidly. So in 2007, we're just building the first prototype of the product.

• 11:03Speaker 01

  It was in closed beta for about a year. Um, and, uh, in 2000 and 2008, we launched it, what's now TechCrunch Disrupt. Our demo totally failed. The wifi wasn't working on stage, so a live demo is quite underwhelming.

• 11:19Speaker 01

  So that took a few years off my life, but fortunately, we had accumulated this big beta waiting list from basically doing this, another version of that Hacker News video, engineered to be even more viral and kind of have all these memes and things in it. But similarly, like a few-minute demo video of what's Dropbox and here's moving stuff between a Windows PC and a Mac and here's all these little Easter eggs about, you know, the HD DVD encryption key or Tazande, who was one of the first YouTubers, or like Tom Cruise jumping on a couch in Scientology, all this stuff that was like, this was a long time ago, 15 years ago or something. But we put this video on Dig and Reddit and

• 12:04Speaker 01

  our beta waiting list went from 5,000 to 85,000 people overnight. So we got this initial seed audience by chasing that early adopter set. And then we also figured out these viral motions around our referral program and shared folders. And so Dropbox started expanding virally for the first several years. And then a lot of the engineering that we applied to the product of, you know, Dropbox can't have a bad day when you're, you know, when it comes to your running photos and tax returns and all the things people put in Dropbox. So we took a while to get the beta right before we felt comfortable opening up to the broader public. But then we applied that same engineering mentality to these

• 12:45Speaker 01

  viral loops. And this was all the era when social media was exploding and Facebook and Facebook platform, like all these startups were setting kind of new land speed records for like fastest to a million users or 10 million users and things like Zynga. And all of this was built on this emerging playbook of virality, which in turn came from epidemiology, like the study of the spread of viruses turned out to be a good parallel for the consumer internet. Draw your own conclusions. But so, and then we had, we were like, oh, there's no reason this wouldn't work for Dropbox. And some of our early investors, Hadi and Ali Partovi, Talk to us about how Facebook thought about growth and then there was a lot of, there

• 13:27Speaker 01

  were a lot of great people in the early days who had really fine tuned and mastered a lot of that. And so a lot of, we tried many things, conventional and unconventional, but the things around virality and the referral program really worked. And so for the first several years, it was just doubling, 10 X-ing every year, putting user, like taping user counts that we printed out to the wall and then running out of space on the wall, having to put, you know, 100,000 users, 200,000, 500K, a million, 10 million on the ceiling. So it was wild. And we, it was super fun, but it was also super stressful. But going from, you know, maybe seven, six million valuation in 2007 to 27 million in 2008,

• 14:10Speaker 01

  to then four billion valuation in 2011, you know, being on magazine covers, just that whole experience was wild.

• 14:19Lenny Rachitsky?

  The visual of the user numbers extending onto the ceiling is such a good one of just how quickly things grew. Okay, so let's transition to the second era. So, things have been going great, keeps growing, obviously challenges along the way, but it's just feels like it's just grow, grow, grow. It feels like the year 2015 was a pivotal year where things started to shift. Does that sound right?

• 14:43Speaker 01

  Yeah.

• 14:44Lenny Rachitsky?

  Okay.

• 14:44Speaker 01

  So.

• 14:45Lenny Rachitsky?

  Yeah, let's talk about that.

• 14:46Speaker 01

  Yeah, the, maybe the end of the first era, the start of our like teenage years would have been around, around 2013, 14. So, and maybe before that, 2011, 2012, we started getting all the incumbents, or all the big platform companies, you know, Apple, Microsoft, Google, all of them launched competing products in one form or another. But weirdly, it was sort of like. You know, you see the videos where there's like the mushroom cloud in the distance, you see it, but you don't hear or notice it. So mostly it just seemed like nothing happened.

• 15:27Speaker 01

  When, you know, Steve Jobs was like onstage in 2011 announcing iCloud, calling out Dropbox by name as something that will be viewed as archaic. And similarly, we always felt like we were in the shadow of the hammer of Google launching Google Drive, which had been rumored long before we even started the company. And so we were just always, for the first several years, were sort of quivering, waiting for, you know, the shoe to drop. And the product's launched, but you would never be able to look at our numbers and see when that happened. And the press often writes about competition like, oh, it's a shotgun blast, when later I would learn it's more of a boa constrictor.

• 16:09Speaker 01

  But the end of that first chapter really culminated in us recognizing that, you know, Dropbox is, we experienced a lot of benefits of being this kind of product for everyone. And in fact, it would be kind of hard for me to describe in the early days who Dropbox is for or what it does, because it was similar, it's like, you know, what's a phone for? Or what's a computer for? And in the beginning, that was a blessing, because it meant that those viral loops would really work, because pretty much everybody you would hit would have a need for something like Dropbox, either a personal need or a work need or both. But we recognized even back then, before competition, that, hey, you know, people are using us primarily for things like backup, packing up their devices or storage, things

• 16:53Speaker 01

  that people are using us for photo sharing, people are using us as kind of a collaborative space at work and often in huge companies. So I've, and then we felt that there was a lot of tension between these use cases. So, for example, the ID, the ideal like file server replacement for an IT admin is going to look quite different from the ideal like consumer photo sharing app. And we also recognized things like, well, we're going to be competing in many cases with the device or the operating system. When you look at something like iCloud, it's like, yeah, when you turn on your iPhone for the first time, it's probably not going to give you like an ad for Dropbox. So we're like, hey, we need to. Address some of these issues. So we and expanded to some new areas to diversify.

• 17:37Speaker 01

  And so the first of that was, or the first two things we did were, after getting enough complaints from IT administrators asking us what the hell these photo sharing features were for, we pulled all the photo sharing functionality out into a separate and new app we called Carousel.

• 17:53Speaker 01

  Where the basic value prop was phones to that point had, were limited in their storage by the amount of physical storage on the device. We're like, this is silly. You should be able to have your whole life in your pocket. So be able to store everything in the cloud, but have the experience be as if everything were locally there through a lot of caching and sleight of hand and thumbnails and things like that. So much engineering there. And the secondly, we saw people were using us at work and we're like, well, there's a lot of different adjacent workflows. And there was a startup called Mailbox that built like the first great mobile email client. Had a lot of funny parallels, like they had a

• 18:25Lenny Rachitsky?

  Oh, that's right. They're famous for that waitlist. That was a really good point.

• 18:29Speaker 01

  Which was crazy. And so we're like, I don't know, maybe this is gonna be our Instagram. That's why we bought those guys. And then 2014, I'm on stage, painting this picture of Dropbox's future. I'm like, we're gonna help be the way that like you remember your life. And we have, we're gonna be your productivity, the new productivity suite on your phone and all these things. But then it was, it was this dissonance where there were so many things that were going right. And that's certainly the numbers, user numbers, revenue numbers, all just, we were sort of accidentally cash flow positive, maybe a year after launching. But there is, it was also clear that, you know, winter was coming, or that like, not all, not all, things weren't exactly

• 19:14Speaker 01

  as they seemed. Because then the start of the second chapter, 2015, we'd start, I'd start to hear a kind of a louder set of critics inside and outside the company. And, you know, I'd been thinking for, thinking for a long time, like, all right, man, we're really fighting wars on all these very disparate fronts, right? Where with storage, we're competing with the device to back up the device. With photo sharing, we're competing with Facebook, Snap, Instagram, Google, Apple.

• 19:47Speaker 01

  On productivity, we're competing with Microsoft and Google. And then there's a whole new cohort of companies like Slack.

• 19:55Speaker 01

  And then, you know, then there's this experience like one day I'm standing on stage talking about how all these carousel and mailbox and everything are the future of the company. Less than a year later, Google Photos launches. And not only does it provide a lot of the same value and look a lot of the same.

• 20:13Speaker 01

  Or, you know, in many ways, very inspired by what we had done. But they also gave you free unlimited storage for life, not just photos, but video. And so they just totally like nuked our business model in ways that were sort of bad enough in terms of just their obvious impacts. But even worse, because it was so like easily anticipated. So, you know, so this became kind of a very public and personal embarrassment for me because like, how could we not have

• 20:47Speaker 01

  predicted that or been out in front of that? And then that started to, that started this period, I'd say that was the beginning of chapter two, where it's like, that we went from the company that could do no wrong to the company that could do no right, which was a big flip. So, you know, it's probably early summer, maybe late spring when Google Photos launched. And first I'm just thinking like, okay, this was a big miss on my part.

• 21:15Speaker 01

  How do we get out of this? We need to like tackle some of these competitive issues much more head on.

• 21:23Speaker 01

  And then, what's the problem? Well, the problem is that every incumbent is gonna copy your product. They're gonna bundle it with their platforms and then they're gonna kill the economics. And that was clear what was gonna happen with Google Photos, right? It's very similar product experience, bundled with Android, bundled with all the Google, all of Google's different touchpoints and then free.

• 21:51Speaker 01

  So that was problematic enough for Carousel, but I'm like, wait, this is going to happen like with everything that we're doing. Same thing with Mailbox. I'd even pitched the founders to join Dropbox by saying like, "Look, you're going to wake up tomorrow and Gmail and Apple Mail and everything is just going to have these swipes and snoozes, and it's just going to be part of the UI is not a good, it's not a durable source of advantage. We'll buy that problem from you." And that's exactly what happened.

• 22:22Speaker 01

  So I'm like, all right, even in theory, how do we deal with this? And I've gotten the criticism over the years that Dropbox is a commodity, and investors in the early days would be like, "Yeah, this is kind of a graveyard of space and kind of DOA."

• 22:38Speaker 01

  And I thought, well, how do other companies deal with this kind of competition and commodities?

• 22:48Speaker 01

  So there's a great book by A.G. Laffley and Roger Martin called Playing to Win. Roger's been on the podcast. Yeah, Rogers. I'm a huge fan of Rogers.

• 22:58Speaker 01

  And I was like, all right, well, if we think we're selling a commodity, like try literally selling paper towels, which is what Procter and Gamble and a lot of CPG companies do. And A.G. was the CEO of Procter and Gamble at the time. And basically, he and Roger did this download of like how they think about competition and markets and advantage.

• 23:23Speaker 01

  So that, and a lot of us like being really thinking really critically about where do you play and how do you win? So being very selective about the markets you're in and only being in markets where you can have a leadership position, and then being really crisp about what is your leadership position. And so that was a good, a very timely thing to read in terms of like, all right, what we're actually, Dropbox looks like a one product, but it's really participating in many different markets. And our big risk might be that we're the number two best thing in each of those markets, which would be a bad situation. Another really influential book was Only the Paranoid Survive by Andy Grove.

• 24:02Speaker 01

  And I'd been a big fan of Andy's High Open Management is another great book of his, which is my introduction to management, Lisa's Theory of Management. So just love that book. And then Only the Paranoid Survive talks about Intel's experience where they actually had something like this happen.

• 24:20Speaker 01

  That I wasn't aware of. And we all know Intel as like the microprocessor company, right? Intel Inside, at least in the 80s, 90s. But before they were in microprocessors, they were actually, they sold memory, like RAM. And in the 70s, they were running into a situation where they had built their really high-growth, successful business selling memory. But then they had these Japanese competitors that were just building, building memory faster, better, cheaper, just on every dimension. And potentially also things like anti-competitive things, like where the government might be subsidizing these manufacturers. And so there was this feeling like, you know, not only they might just be better at the game,

• 25:02Speaker 01

  but there's also not a level playing field. But meanwhile, you wouldn't see it in their numbers. Like, they're still growing, it's just that there were these weird, dissonant

• 25:13Speaker 01

  experiences where salespeople just suddenly have problems selling into accounts that used to be a slam dunk, or things that used to work just stopped working. And this happens, like, you know, it was like BlackBerry's and Nokia's best sales year has happened in the years after launching the iPhone. So it doesn't, these things don't actually change immediately. And so Andy labeled these moments strategic conflation points for a company. And I'm like, yeah, we're definitely in a strategic conflation point. But they were dealing with, like, okay, like, our whole business is memory. How do we deal with this competition? And there's this little vignette where he and Gordon Moore, one of the other co-founders of Intel, said, hey, let's pretend we're consultants to ourselves. What would

• 25:54Speaker 01

  we do? And what they immediately decided was like, oh, well, we clearly get out of the memory business and put all of our chips on this sketchy little microprocessor thing that was much smaller but very high-growth, and potentially a big market. And then they're like, well, you know, why don't we do that? Only problem with that is that's like saying, it's like Google saying, yeah, let's get out of search and go on on Gmail or something or YouTube. So it just seems insane, but they caution, or Andy cautions in the book that like, look, most of the time CEOs want options. They want to hedge their bets. But you really want to do in these strategic inflection points is go on in one thing, or as Mark Twain put it, like, put all your eggs in one basket and watch that

• 26:38Speaker 01

  basket. But what the implication of that, and I was like, all right, this makes sense to me. But man, this is, this can be painful. So we go away for 4th of July, I'm with my family in New Hampshire. I reread the book. I come back. I'm like, well, we really got to do it. And I so I killed Carousel, killed Mailbox, went all in on productivity. To some extent, that was an easy, a relatively easy decision, because most of our subscribers, you know, 80% of people paying for Dropbox were using it at work. But that meant foreclosing on photo sharing and consumer and storage and all these things that Dropbox had become synonymous with. And to this

• 27:21Speaker 01

  day, are some of the things that people were most recognized for. And I wish I could say, like, then everything got better. It was the opposite, actually. The narrative completely flipped on the company. The press started, you know, we should, we killed these new products and then, internally and externally, the narrative became super negative. The, you know, articles would come out every week or two, like, oh, Dropbox is going to be the first dead deck of corn. And then sometimes, you know, we've all seen this in tech, like, companies sort of get in, get in this washing machine of sort of self perpetuating negative press. And if it goes deep enough, I mean, Uber had this for a while later, you know, Meadows had this over their

• 28:02Speaker 01

  history, lots of companies, where you just can't get the monkey off your back. And then what, because what the reporters end up doing is they basically, you know, park their metaphorical van behind your office, they interview all the people that you just fired, and then print everything that they say anonymously as if it were facts. And, you know, I'm not playing, I mean, I'm not, I'm not.

• 28:25Speaker 01

  There's a lot of truth to what the press were saying, so I can't really blame them or say that they were being unfair. But it immediately put recruiting into this deep freeze. You know, just in the situation, you've started this company, it's been super successful, and then suddenly, you know, your employees don't want to wear your T-shirt anymore. And frankly, you don't even want to wear your T-shirt anymore. It's just you, you completely take your pride in your own company takes a big hit. And meanwhile, you know, we, I've talked mostly about the external market competitive forces. But inside the company was a mess too. Like we were, the business's revenue had scaled so much faster than our, than our ability, than our ability to hire and sort of build the right infrastructure and operations internally.

• 29:08Speaker 01

  And so everybody's just kind of like panicking and being like, all right, well, good, Drew, we're not doing carousel, not do the mailbox. Like, what are we doing? And, you know, the truth was like, if I knew the answer to that, like, we could be doing it. But it's just, this is going to take some time to figure out. So it's pretty tough. You know, when everybody's looking, looking to you as the founder and CEO, looking for quick fixes and answers. And also just wondering like, how the hell did you get us in this situation?

• 29:36Lenny Rachitsky?

  Wow. So we're going to talk about how you're actually turning things around and the work you're doing now, learning from this experience. But I have a lot of questions about this part of the journey.

• 29:44Speaker 01

  Yeah, yeah.

• 29:45Lenny Rachitsky?

  Just to kind of almost summarize the journey, it's like launch, killing it, viral, find all these opportunities, find all these big markets. You kind of start three different product lines. There's like the enterprise use case, there's the consumer file storage use case. There's photo sharing, there's productivity. And then basically every big incumbent's like, okay, great, we're going to come eat your lunch. And you end up fighting wars on three or four fronts against the big kahunas that have infinite cash and can do whatever they want.

• 30:17Lenny Rachitsky?

  It's interesting the way you described the Apple launch of just like it was this mushroom cloud that you didn't quite see for a while, but but the Google Photos launch was like, okay, that was like more clear of like, okay, this is bad news. Is there anything? I know it's always easy in hindsight of like, oh, I should have done something different when Apple launched this thing. But is there anything maybe you could have done? Or is there was it even possible to have adjusted course at that point? Or is it like, okay, this is tough and we need time to figure it out?

• 30:44Speaker 01

  Well, we panicked about the Apple thing too, because that also send, you know, I created a much smaller version of the sort of tempest in a teapot that the Google Photos did. It was just much less public. Or it was just less obvious that we would be so in such so out of position. And actually, we were more surprised to the upside when, you know, it's Google Drive launches, iCloud launches, OneDrive launches, and even as they build like version two, that we just didn't really notice that much of a problem.

• 31:20Speaker 01

  And, you know, I also studied over the years, you know, what happened to Netscape? And companies like, or you know, MySpace, or these other cautionary tales. And interestingly, Internet Explorer was a thing that eventually undermined Netscape enough to sort of permanently throw it into a negative trajectory. But Internet Explorer 1.0, 2.0, even maybe 3.0 just weren't that good and didn't really do anything. But Internet Explorer like 4.0, 5.0, and all the bundling, that really made a big difference, or a big negative difference. And then another thing that was interesting was, so there's a big time lag where between when these products launch and when they

• 32:03Speaker 01

  actually have an impact, because often it's also the existence of the product or its availability. It's the sort of constant bundling or the constant iteration or, you know, it's the boa constrictor. It's like, in any given second, it's not much tighter. But, you know, over the following day, you know, you're in a bad place. And then, but another thing that was interesting was, one cool thing that we got to do in moving to California is you get to actually meet people who had been at these companies. And one of those people

• 32:38Speaker 01

  Was a guy named Bill Campbell, who was at Netscape during that whole period. And I'd asked him, I'm like, man, that's like really unfair. That sucks what happened with Microsoft and bundling with Windows and all these things and the antitrust and this and that. And he's looked at me, he sort of laugheded and snorted and he's like, Microsoft did not kill us. Like, we killed ourselves. And so that was the other half of what was the problem within Dropbox was a lot of our wounds were self inflicted. In that we were struggling to keep scaling and launching all these products and the Dropbox products had kind of stagnated.

• 33:25Speaker 01

  And I started to learn the hard way that, okay, yeah, this, I now understand what Bill is talking about. Cause we are hiring all these smart peoples, but the things we would do as a company would seem really stupid. And then some of these things were me personally, like, yeah, I knew about from reading all these things, but for whatever reason, I guess we just like kept,

• 33:52Speaker 01

  kept going anywhere. We were just like too confident in our ability to respond or we sort of got into this lulled into this complacency. We're like, oh, well, you know, because it hasn't been a problem, it won't be a problem in the future. But I'd say there's something about the Google Photos launch that just really set things off kilter.

• 34:11Speaker 01

  And then, and then also for me personally, I mean, I think, you know, go from feeling pretty good all the time, good, but stressed out all the time. To mostly feeling bad all the time. And, you know, I just remember like leaving, really trying to get away from the office for a little bit during this period. Kind of like picked my teeth up off the ground. The good news, I bought a place in Hawaii. So I was like doing that in Hawaii, but didn't feel very good in any, in any way. And.

• 34:44Speaker 01

  And I like learned, or I had to like really figure out a lot of different things for myself to be like the leader that could get us through this. Because mostly what I felt was like, man, I felt like we'd been doing such a good job, but now like, man, if I ever like really screwed this up or like, I don't, maybe I don't know what I'm doing. And so I think maybe the, some of the best, and then I had to really reset on a number of fronts. Like one is, I just remember thinking like,

• 35:19Speaker 01

  you know, my 18 year old self would be like, what the hell are you complaining about? Like you did it. Like it's so great. And yet I felt so bad about things. And so I'm like, how, I'm like, yeah, both of those things are true. Like, how do I navigate that? And I think one, one part that was really helpful is sort of getting a sense of equanimity, basically. And doing a lot around like mindfulness and meditation to sort of distance. One thing that happens when you're a founder and your company succeeds is your identity is fused with the company. And so it's easy to get in a situation where you only feel good if the company's, or however the company's, how you feel is how the company is doing.

• 36:04Speaker 01

  And you need to sort of separate that a little bit. So what that looks like for me is sort of recognizing like, yeah, there's really not an easy button that keeps things up and to the right.

• 36:17Speaker 01

  Forever. And most of the entrepreneurs that are like my heroes had various periods of wandering in the desert. Those things, instead of just being problems, were probably the crucible that forged the people that they became. So the presence of badness is not necessarily you are bad. And, and it's like, yeah, no, you're just getting your stripes as an entrepreneur. And people were really helpful during that period. So I mentioned Bill Campbell. He was nice enough to, we just stayed in touch and he would take me out to dinner, you know, every now and then. And I would be freaking out, but I was always afraid. He'd never seem to be freaking out. And mostly he would just be saying like, all right, he'd sort of like dust you off and kind of smack you and say like, get your ass back out there.

• 37:03Speaker 01

  And he was, you know, he was literally a coach of the Columbia football team. But in addition to being a great technology executive and advisor to the many of the great founders that I had looked up to.

• 37:17Speaker 01

  But, you know, he was just sort of, he was really helpful because he sort of helped me believe in myself. Even when like I wouldn't believe in myself. And then people like Andy Grove, who had written all these books. I'm like, well, at least I'm having this problem. But yeah, this raised, then that raised a question for me. I'm like, okay, I've been through this chapter one where everything's up and to the right. But I sort of ran out of like, like merit badges or like Xbox achievements to collect. Like, I was like, we have, we did it. We got the product to this many users. We got it to where we got this valuation, or let me back up. So my whole life and

• 37:58Speaker 01

  or it's common, I think for a lot of founders, especially if you get good grades and stuff, you follow a pretty linear path from childhood from,

• 38:06Speaker 01

  you know, first get the right test scores, then get into the right college, get in the right college, take the right classes, get the right internship, get the right job. And early startup life is like that a lot. It's like, okay, have an idea, find a co-founder, get into Y Combinator, get funding for Sequoia. Watch an MVP in just in 10 million, 100 million, billion valuation. And I felt like we'd cleared all that. And so actually one of the other problems, like I don't even know what Dropbox needs to be. And I don't even know what I need, that I want to be in the world. And so.

• 38:42Speaker 01

  Part of this was also like re sort of reconnecting to some kind of sense of purpose. Cause I, if I was really honest with myself, I was like, well, I'm just like checking boxes and sort of advancing and leveling up. Like a video game or something, but now I'm here, I'm like, all right, what is it just big numbers bigger? Um, it's also not that fun to just. Launch something that you put your like soul into and then just have it get crushed. These competitors, it's even worse when you're bringing all these. Hundred other people who worked on that thing through that, you know, meat grinder too. Um, so, uh, you know, are we just inventing things 10 minutes before? Google and Apple do, if not, what are we doing? Um, and then if we're really, really honest with ourselves, I'm like, I think it's kind of hard to argue that no one would have invented like.

• 39:26Speaker 01

  Cloud photo gallery that wasn't constrained to your local storage. Um, so I had to like really rethink like, what, you know, what does the company need to do? That actually took a longer time to answer than I wanted, but then also just what do I want to do? And I was like, well, you know what? Um, I'm going to do this, what I ended up settling on was like. Look, you know, kind of come back, come back to my 18 year old self, I'd be like, I would like, was like, all right, stop complaining. This is like a pretty good situation. You wanted something where the learning curve would be steep. Here it is, um, you get to do this really meaningful work to build things for millions of people. Work with awesome people, work with awesome teammates, you know, there's always good things about it. And you've like chosen this life, so stop complaining about the burdens.

• 40:11Speaker 01

  Um, cause it's really dangerous if you start to resent the job. Um, or feel like a victim, because that's just like corrosive to everything else that you can get in this spin cycle.

• 40:20Lenny Rachitsky?

  What helped you come to that place? Because that sounds like a very hard place to get to and a very important place. Was that like Bill Campbell advice? Was it a lot of, how long did it take you to go from this is not going well and that life sucks to? Okay, let's look at it this way.

• 40:35Speaker 01

  I think there are a couple unlocks that were pretty fast, but I think, you know, again, this was not like, oh, then I felt better and we. Live happily ever after at all, um, you know, it's, there were some moments. Of recognition where I was able to like, I always try to like get away from kind of the. Mayhem or the whirlwind and, and re-center myself and do think weeks and things like that. Um, and so those are really helpful because I felt when I diagnosed like, well, when I'm on this treadmill and just like firefighting. Or how did I miss this important thing? It's like, well. The, basically, the root causes of being on the treadmills, I was just like, had no, I was like,

• 41:16Speaker 01

  too busy firing to aim. And then, like, I thought I would do my aiming on vacations and things like that, but like, no, it really needs, um, I need to like, get off the treadmill every now and then, and make the space to really address some of these bigger questions. Cause it's not like I didn't forget about them. They just were like, always below the fold on my to do list to deal with. And then until, you know, you know, a few years go by and you're like, wait, yeah, we really were just strategically at a position. The other way I sort of came to some of these conclusions,

• 41:49Speaker 01

  uh, there's a combination of things. So I think picking up like a meditation and mindfulness practice, um, having therapists personally, having coaches, um, having friends and mentors, uh, other founder friends. And so I wouldn't say it was any one thing, but I think it was a whole, you have to like, build this whole ecosystem of support around yourself and recognize like, no one's gonna do that for you. And it's super important. And then, and then to the other, you know, Bill's other point is like, yeah, we're killing them, or the, Microsoft wasn't killing us, we were killing ourselves. I think, you know, having to ask some hard questions to myself of like, yeah, this, some of these wounds were self inflicted. Um, this, you know, as much as there might be Microsoft, yeah, I could look at this and say, oh, Microsoft is mean, or Google is mean,

• 42:31Speaker 01

  or Apple is mean. But I'm like, at the, you know, I drove the ship towards these rocks. So like, you know, there's no one I can, that's one downside of being founder CEO. You can never, you don't really have some, you can't blame the last guy. I think every founder has to really, one of the big questions every founder has to figure out is not just like, how do I have equanimity? What's my purpose? But then also like, what am I doing that is destroying the company?

• 42:56Speaker 01

  And because everybody's got strengths and weaknesses, but as CEO, like, you know, both your strengths and your weaknesses are massively amplified. Um, and a lot of, um, blind spots in your personality can become huge cultural dysfunctions in the company. Um, and so step one to dealing with that is like, building awareness.

• 43:15Speaker 01

  And one thing that kind of floated around the company for a while was the Enneagram, which on a surface is a personality typing thing like Myers-Briggs. I often describe it as like, it's like Myers-Briggs, but actually useful. The way it works is it's a personality typing system. You get a number from one through nine. That's kind of your dominant person. There's nine types that are numbered. It's similar to Myers-Briggs in that Myers-Briggs has 16 types of letters like ENFJ or different things. But I find that Myers-Briggs is more descriptive. So it doesn't really, it tells you like, okay, you're an introvert, not an extrovert, or vice versa. You're judging instead of perceiving.

• 43:59Speaker 01

  But I could never really work out like what that meant. And so it's descriptive versus like predictive or causal. Enneagram is the motivations or the theory of it is really about your fundamental motivations. What are you running towards and what are you running away from? And the theory goes like, it's some combination of your wiring from your genetics and your early childhood. You're kind of, your autopilot is kind of fixed after your, after your childhood in that like you just have instinctive responses to things. Now it's autopilot. It doesn't mean it's your destiny. You could override it, but it's super important to become aware of like, you know, what is, what are you running from and towards?

• 44:41Speaker 01

  And the Enneagram gives you a really good map to do that. So, and so I'm reading this book and it starts by like you type yourself and I'm kind of rolling my eyes. I'm like, okay, I'm a seven. What's a seven? And then you read, each type has its own chapter and you read the chapter. And I was like, oh my God, this like completely describes like who I am down to my core. And I was like, almost like looking over my shoulder like who the hell did this? Like, I thought I was a special snowflake, but apparently not. Okay, I'm listening. And, you know, in a dovetail with a lot of my early coaching experiences, which are, you know, you do a 360, your coach sits you down, they're like, here are your strengths.

• 45:23Speaker 01

  You know, in my case, it would be things like, oh, you're really creative and you like new ideas. Like, that's okay. And second, you really love people. You build great relationships with people. I'm like, okay. Third, you're really comfortable in chaos and resilient.

• 45:40Speaker 01

  I was like, this coaching thing is great. See, this is my first coach. And then, then you flip to your like development areas. Cause no one calls them weaknesses. It's like, all right, one is like, you're like bored by routine and really undisciplined. Second is you're really conflict avoidance.

• 46:00Speaker 01

  And third is

• 46:03Speaker 01

  you're like, you're intuitive, but you're also like pretty chaotic and like, don't create enough structure for people. So they're mostly confused. And when you sort of pair the two together, you're like, oh, wait, yeah, I'm creative and like no ideas when I'm bored by routine and, you know, bit of a space cadet. All right. You love working, you love good relationships with people, but you don't want to make them unhappy. So you don't tell them the truth, basically about things that are difficult to hear. You know, so, and it's gonna be a similar kind of map for things, depending on your personality type or circumstances. But the Enneagram was that map for me to be like, okay, I've got these things that are genuinely great, but I need to like address, but the, but, but these downsides of like the company's conflict avoidance. So we're like,

• 46:49Speaker 01

  not telling the truth and then making a bunch of predictable mistakes, or I'm creating this really chaotic environment where people don't know what they're supposed to be doing. Like, that's a problem. Like, my personality is like quite directly gonna torpedo the company unless I do something about it. Same is true for any founders. And, you know, it'd be, I'm a type seven, it's the enthusiast. It's like, you know, again, central casting is like, you like a lot of new things and creative and love just interesting things, but then kind of a space cadet, FOMO, you know, some of the shadow side of it. And every type has a thing like that. So. Really understanding, okay, then I was also just frustrated in the day to day of my work. I'm like, yeah, I'm not really getting to do these like creative things or I'm like too busy firing to aim.

• 47:33Speaker 01

  I'm like missing these like bigger picture things that are really taking the ship way too close to the rocks. Like, okay, then I need to then understand what those things are and either like work on myself or like hire the right people who don't have those issues. Or one way or another, just like make it so the company is not so exposed to like my personal dysfunction. And so, yeah, it was a whole kind of constellation of things like that where it's like, all right, we have to get, I mean, after this whole tailspin, like we got to work, I'm like, all right, first business issues are just like, the most urgent issues, we're just like blowing all this cash. We need to like get the P and L to look a lot better and get out of this land grab mode or like fighting with like,

• 48:16Speaker 01

  you know, Google on like giving more free storage away or just being in these fundamentally unprofitable things. And so we, we did that, we cut the unprofitable parts of the business. We turned cash flow positive in 2016, maybe several months after this reckoning. And that's at the tracks for getting a billion run rate in 2017, going public in 2018. We had to come up with a new vision and mission for the company, which I'll maybe save for, for chapter three. And then I was also just trying to do things that were like more, that helped sustain me through the difficult things. Like, I'm like, well, I'm an engineer as a little kid, I was coding since childhood.

• 48:58Speaker 01

  I knew I wanted to be a founder, I didn't know I wanted to be a CEO, so I sort of backed into being a CEO. And then, so I'm like, man, there's a lot of tedious things about being an executive. So I was like, I would find ways to like automate tedious parts of my job and learn machine learning in 2016 and 17. And that ended up being really important later on. But then also is just like coming to terms with my job and you know what I wanted to do from a personal perspective, which included things like, oh, you know, I'm lucky in that being a CEO is, you know, I always wanted a steep learning curve in a lot of professions, like in sports or, you know, math or chess or certain academic fields, like you kind of peak in your twenties or thirties. CEO is not like that. You can kind of go your

• 49:43Speaker 01

  whole life and still not be like a master. So I'm like, you know, for better or worse is pretty cool that I can can do this kind of work. And then, you know, I don't really get that much out of just like chasing bigger numbers. I just really want to like the thing that is my favorite thing about Dropbox is like looking over someone's shoulder in Starbucks and seeing if the little Dropbox icon is there, like building something that becomes a verb, like taking some of the pain out of technology, things like that. So really reorienting. Yeah, it's not about just like the scoreboard, like external scoreboard just much. It's more about like the craft of being a great CEO and like building things I'm really proud of or really making a difference. And so that those kinds of things, I none

• 50:25Speaker 01

  of them all kind of coalesced. Well, it's sort of like this lens that like slowly and stubbornly comes into focus, but making the time to have some of that reflection was super important.

• 50:36Lenny Rachitsky?

  So much of what you're describing makes me think about founder mode in a lot of different ways. One is your point about how you didn't have a lot of time to think about where things might be going and how the markets are shifting and that has to happen. Basically, no one else is going to do that if it's not you. Also, just this idea of how much of the solution was you understanding yourself better, reflecting on where you have strengths and weaknesses. Also, I'll mention, so before I had Brian Chesky on the podcast, I asked you what should I ask Brian? And you asked me to ask him basically about founder mode, which was the first time I think you talked about it. And now it's like this whole thing. And so you've been in the middle of all that for a long time. I guess just any thoughts on like the importance of that and how you think about that as a founder?

• 51:19Speaker 01

  So founder mode means a lot of things to a lot of people. So it's it's sort of it's a bit of a Rorschach test.

• 51:28Speaker 01

  But I think like parts of it that really resonate with me are there's this evolution you go on as a founder where you sort of don't know what you're doing.

• 51:38Speaker 01

  And and everything is new and unfamiliar. And then you're also like very involved in all the details because there's no one else to be involved in the details like, you know, it's like someone else is like coding for you if you're just like in your room at home.

• 51:55Speaker 01

  So, but then over time, you have to, there's this like, Ben Horowitz calls it the products, the product CEO paradox where companies, the first way that companies die is from founders not letting go.

• 52:09Speaker 01

  And so

• 52:11Speaker 01

  you need to learn to like scale yourself and like hand off your responsibilities and operate at a higher level of abstraction. But then the second way that companies kill themselves is the founders get too far away. And I felt like I had done that. And that's what, that's a big part of the problem that led to a lot of this chaos at the end of chapter two, where I was like, oh, man, I'm on the treadmill. I'm doing stuff, but I'm clearly not setting the right direction or people are confused or just, you know, it's not working. And I was like too distant from the product. And then, you know, there's all kinds of issues you can get into as you hire an executive team and get that to function well.

• 52:49Speaker 01

  And so I think there's a debate to what extent founder mode is sort of a mindset, mindset or a destination.

• 52:56Speaker 01

  To me, I think the destination part is pretty important. I think it's like after that learning journey, suddenly you have this conviction from actually knowing, from having lived experience and kind of navigated a lot of these things. Where suddenly it's a lot clearer. You don't have the same kind of confusion or learning curve problem. And then then, you know, if you start off being too far leaned in, then you like lean out too far. And I think a lot of that founder mode flip is like when you're like, hey, this is not the company I want to be running. Things need to be like, I need to be more involved. I need to stop making excuses like I, you know, I need, and it's like basically, I also don't want to like apologize or negotiate all the time for the kind of company that I want to be part of and run.

• 53:40Speaker 01

  So I had that too over time, maybe in more towards like a chapter three. Some of those elements of.

• 53:48Speaker 01

  You know, and I think part of, I don't know if there's a way to get to this destination without some level of pain, you know, certainly like the Elons and Steve Jobs of the world had sort of big, big spans of like wandering in the desert where they were not as cool as they are today and like the things they were doing aren't working and they managed things very differently in that sort of post wandering phase and suddenly had this level of like conviction and intuition that they might not have had before or they sanded down some of their more like counterproductive instincts. So, so again, there's a lot of surface area. I don't know if anybody has a common definition of founder mode, but

• 54:30Speaker 01

  certainly that evolution, I mean, that way I think about is like, it is very difficult. Like one of the hardest things when you're running a company is that you're hiring all these execs who the only thing you know is like, they know a lot more about their subject matter than you do. And so like, what does it even mean to manage, you know, bring someone in, bringing an exec who had managed like a double digit billion dollar P and L at Google and like, what am I supposed to tell him how sales works or marketing or like, but you end up, it's easy to be too leaned out there where you're like, not really giving, sending clear direction. And so, you know, each founder is going to have their own sort of things that are easy, things that are harder. Step one is being aware of them and then having, being intentional about how do I like offset those things? And then, and then you eventually get to a point where you, the learning curve flattens out, you

• 55:15Speaker 01

  actually do have some experience and you can have a lot more conviction about where the, what, what the company should do and where you want it to go.

• 55:24Lenny Rachitsky?

  Awesome. The way you described it to me, which has really stuck with me is like, as a founder, as you said, you're in there leaning in, doing all on top of everything, micromanaging, then you lean out and hire execs that you think are smarter than you and delegate more. And then it's like, oh, things aren't going great and come right back into it.

• 55:40Speaker 01

  Well, and specifically, it's, you know, often well intended, but you know, as you, or it's often even not conscious, but as you hire these execs and then you also build up like an HR function, you get coaches and things like that. And then there's, the things are not going well. You know, one thing that can happen is you start collecting all this feedback and people are like, wait.

• 56:05Speaker 01

  If I can give Drew some negative feedback, then maybe I can displace some of the, you know, it's sort of easy to get into a situation where you're sort of being, I'm my, my to do list of like, problems and just like weaknesses and flaws I needed to work on was like, super long, like way longer than anyone else's. And on the one hand, I'm like, well, I want to, yes, I'm wholly accountable and responsible for everything in the company as its CEO. So that's not wrong. But you can sort of end up just like taking on, carrying too much of the water. And so a lot of it ended up having to be kind of this, like pushing back a bit and be like, all right, yes, there are things I need to work on, but that can't be an excuse for my leader, my, my execs to somehow

• 56:49Speaker 01

  evade accountability. So there's these sort of systemic things that can creep in for sure. Where you, and then you end up, you get this feedback and you're like, now I'm doing all this behavior, or now I'm behaving in ways that I don't think are really right. Or I'm like, everything is this like negotiated compromise, compromise of everyone on the roadmap, or on how we behave, or strategy. And so you need to, at some point, you end up like blowing that up as a founder. And that was certainly my experience.

• 57:18Lenny Rachitsky?

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• 57:59Lenny Rachitsky?

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• 58:11Lenny Rachitsky?

  I think this is a great segue to get into chapter three. Basically, what I understand from what you're going through right now is you're rebooting the team, rebooting the core business, rebooting the product. I think it might be good to start with the team. You talked a few times about just how you feel like you got to a point where the team wasn't shipping as much as you thought you would, as much as you think they should. Talk about maybe that part of it of just the realizing, hey, this part of the business needs to change. And then we can talk about the product and the direction discovered.

• 58:41Speaker 01

  Well, I mean, my playbook as an entrepreneur is to get like really frustrated by something and then try to solve that personally. So I'll cover the team and sort of the what direction we ended up choosing kind of together. So, you know, my first frustration was like forgetting a thumb drive and then wanting to like never have that problem again. But my second big frustration was like, man, I am running this, scaling this company is like way harder than it should have been. And thank God I had people like Bill or Andy or friends, mentors to guide me along. A lot of people don't have access to that. But, you know, I feel like I could have like written myself postcards.

• 59:26Speaker 01

  The first thing you lose when you go distributed is context, right? We sort of get a lot, you get a lot for free from osmosis and just go, hey, how you doing? What's, how's this or do you have that thing? But then when you're remote, then a lot of that gets replaced with like endless video meetings and lots of Slack messages, which is super inefficient. And you also, you know, one thing that was clear across the board from all the successful remote, remote first companies was you have to be more documented. But then you have a lot more documents. And so we were like, you know, this started turning up like very obvious problems, which is like, wait, why do I have like one search box at home and 10 search boxes at work? You know, why is it easier to search all this human knowledge than my company's knowledge?

• 1:00:10Speaker 01

  Why is this problem getting worse, not better every year? Because if you think about, you know, we've got 10 search boxes that you search 10% of our stuff. I'm like, we should just like fix this. And again, even just as a frustrated user, maybe 2018, 2019, I'm like having this problem myself. I'm like, it's really hard to find stuff. Plus, there's always like cool like vector search stuffs and you know, deep learning stuff happening, even for chat GPT. I'm gonna make like a personal search engine that takes us. So I shouldn't have to try. You know, if I search for strategy and the title of the document is plan, it should sort of like get it right. And the matching should be fuzzy. And then I built something like this. I'm like, oh, my God, it like completely works. You built this yourself, you're saying? Yeah, this was like a, it sort of went nowhere for a couple of years.

• 1:00:54Speaker 01

  But then after COVID and after like we're dealing with all these like information problems, I'm like, yeah, we should like be the company that helps you get the right information at the right time to the right person. And I bet that like little hacked up search engine thing that I that I made could be part, might be an ingredient to this.

• 1:01:13Speaker 01

  So we bought a little company called Commandee that was doing universal search. And we created this new product called Dropbox Dash. And basically Dash connects to all your different apps. It gives you universal search and then after, and then obviously after chat GPT, not only do you, can you do conventional search, but you can actually, you can ask questions in natural language and answer a lot of the questions that chat GPT can't because it's not connected to your stuff. So if you ask chat GPT like,

• 1:01:39Speaker 01

  where's my, what is my lease expire? Where's that slide from last year's product launch? Can't tell you because it's not personalized, because it's not connected to your information. And so we did all of that. We furthered this whole connector platform where it connects, we index a known universe of SaaS apps, have this kind of intelligence engine that brings all of it into a common representation and lets you do conventional search, natural language search.

• 1:02:04Speaker 01

  And then more than that, like we want to organize your working life for you. And stepping back even further, you know, often it happens that a company like starts solving a problem and that problem is never like permanently solved. So in a lot of ways, Dash is like the biggest and best embodiment of like solving the same kinds of problems I started Dropbox to begin with. Because on the one hand, I was talking about thumb drive, but I wasn't really, if you think about the higher level job to be done, I was like, no, I. The real issue is that like it's super hard to find my stuff and organize my stuff and share my stuff and secure my stuff. In the beginning, that was like my stuff was my files

• 1:02:44Speaker 01

  and the scattering was across devices. Now, the stuff is like tabs in my browser and cloud tools, but it's a lot of the same problems. Like, we've talked a lot about search, but then organize is still a big problem. Like, the idea of having, there's no like desktop folder or desk top as in the physical realm when you're in your browser, right? It's just sort of this ocean of content that sort of like washes by you and then you get tired and you nuke the whole environment. But yeah, there's nothing like come back to. There's no like collection concept, right? And files have folders, songs have playlists, links have, right? So if you want, if you're getting ready for a board meeting or remodeling a house, there's no common container. If you have like a Google Doc and a 10 gig 4K video

• 1:03:28Speaker 01

  in an airtable, this is like a new problem. So Dash also helps, it has this thing called Stacks and has basically smart collections that help share, make sharing a lot easier. But again, a lot of this was sort of an intersection of like, yeah, well, how has work changed since COVID? What crazy little science projects have I done? Then like, how should one like find and organize and share their information in the cloud era? How, if I were to build Dropbox today, what would it look like? And Dash is the first part of the answer. And so we're super excited, but we just launched it like six or seven, two months ago. And since then, signed up our first customers. And so, and then I can come back to just rebooting the core business too. So I think one of the big challenges

• 1:04:13Speaker 01

  or lessons from this whole period is that, one is as, you know, part, part of the problem we had with competition and this sort of chapter two was, was external, but a lot of it was internal, where we just didn't, we couldn't organize ourselves effectively. And the business has scaled so much faster than our ability to manage it. First, to recognize this is not like a unusual problem. And many companies

• 1:04:41Speaker 01

  Not all, but certainly many, and actually many in SaaS, SaaS productivity have this sort of sophomore slump, where you have a super successful first product, but then it's challenging to build like the next, you know, the next platinum album. Right. So Dropbox has fallen into that category. You could say other, you know, Zoom, Slack, others. So first it was, yeah, like, it's just like, this is not like, you know, it's easy to sort of feel bad about it yourself, but like, no, you're not, this is actually a very common problem. And then there's a lot of solutions, people devise lots of solutions to this. So part of it is structural. So you have to, your company has to go from a pretty fun and

• 1:05:25Speaker 01

  stable state of like a functional organization where you have engineering and product and design, and there's one product and there's one customer, and everybody's working real well in the same direction for the same team. To then when you have like multiple products, then you have all these conflicts, where, you know, how much should we invest in the core business versus the new thing? How much, you know, who should have authority in the company? How do we, you try to do, you try to build multiple products in a functional org, but then you know, you lose accountability because people are like, well, I'm, I'm spinning a lot. I'm trying to make Dropbox work and I'm trying to make Mailbox work and I'm trying to make paperwork and all these things. And, and so then you respond by like sort of breaking up into groups or, you know, business units.

• 1:06:10Speaker 01

  So we have kind of a product business unit, product GM structure. Then you have to refactor things to have like a common technical platform and all the G and A functions. So there's sort of, there's this metamorphosis and maturation you need to go through that, you know, is obvious, is like mega obvious to experienced people and you're just like totally blindsided by this if you're solving it by trial and error. So it's a great book, Zone to Win, that talks about some of this, what needs to happen internally by Jeffrey Moore. And then there's a lot of cultural problems that set in and we just touched on some of them at high level, but. You know, whether you're in a company or in an empire, a civilization, what gets you to the top turns out to be pretty similar things. You have sort of this like,

• 1:06:55Speaker 01

  you know, outsider challenger mentality where, you know, you have to eat what you kill and the odds are against you. And if you're like hard work and learning and grinding, you start moving up the curve faster. But then, once you're successful, then you, there's a temptation to take the foot off the gas or enjoy the finer things in life. Um, or just focus on other things be it other than what got you there. Um, and so I think what, you know, we experienced, many other companies experienced, Bill Campbell experienced in Netscape. Um, this, this sort of seeds, like success plants the seeds of failure in terms of like complacency or entitlement. Um, or taking your eye off of what got you to be successful in the first place.

• 1:07:37Speaker 01

  And so, yeah, I kind of went from earning a lot of the early stage startup founder merit badges to earning the stagnation and irrelevance merit badge. And now like the turnaround merit badge. And like part of that is the turnaround playbook. Like, okay, you know, first is just like getting out of this like delusional state where you think you're great. Like it's just sort of splashing cold water under your own be like, look, we haven't shipped any like the last three years, like the only thing our customers have really meaningfully seen from our product is a price increase. Like what the hell are we doing? And so, you know, and, and a lot of it is like getting back to like, hey, we have to focus on craft. We have to

• 1:08:18Speaker 01

  embrace like a growth mindset and learning. We have to um, stop blaming external factors or displacing blame. Like we have to be a high agency culture. And so there's a cultural transformation that you have to personally embody and be clear about. And then, you know, in our case, we had to like reboot the whole exec team. So we've, you know, we've had all the time getting the right kind of leadership team in place for sort of the end of chapter two and three. And part of what happens in conjunction with a lot of the cultural stuff I just talked about is also you can have this as a talent, the talent flywheels flying forward and flies in reverse, you have a new set of issues where you get all these amazing people in

• 1:09:03Speaker 01

  the company, but you know, they want to work for Facebook, not MySpace. So you start having retention problems when the narrative goes negative. So we start like bleeding talents and then not, and then it's also really hard to hire people for the same reasons. And especially, you know, as I think about where the big, big lessons from chapter two that we've addressed in chapter three, the seniority gap is something that can accumulate because the talent can be, can, much of the talent can kind of fly to the next, you know, shiny thing. And what you do in response typically is like you promote a lot of people internally, which is sort of good for them. It's, it's, it seems good for them in the short term because

• 1:09:46Speaker 01

  they're just getting a lot more authority and responsibility quickly. So people like that on day one, but it's a problem because suddenly people are, you know, solving problems through trial and error, or things may be new to them that are not new to the industry. And then suddenly, you know, knowns to the industry are like unknown unknowns to those leaders. And then usually you can get around that by hiring a layer of experienced execs, or having like enough of them in the company. But in the sort of talent wars of the late teens, you know, we were in the situation, as were many companies, where any exec you talked to with any experience had like five offers from Fang companies for like three

• 1:10:26Speaker 01

  times a comp and a third of the workload, or like 10 offers from like pre-IPO startups of like C-level roles. And these are like offers at hand. So like, the only thing that really worked to even just like keep the lights on was basically giving people like double promotions so that they could justify the, you know, someone who's a director at company X, like making him a VP at Dropbox. And then you had to do that because like they literally had offers in hand of like many millions of dollars a year. And otherwise you just hired like no one. That cooled off a lot after the correction in SaaS. After we got more of our kind of vision straight and certainly after we've been working on things like Dash. But that seniority gap is really rough where.

• 1:11:09Speaker 01

  You actually where you need to have enough experienced people in the company. Who can then train your high potential people and again, that sounds obvious, but it's like very difficult to. Do that in an environment where the talent flywheel was going in your direction and then starts flying away from you really quickly. And then through the battlefield promotions and these sort of like double promotions on on hiring. You can end up a situation where there's a huge. Kind of voltage drop in terms of like. People's matching between what your company needs and what they know how to do. And. And you that also doesn't mean like hire only experienced people either, because then you're sort of splicing in a lot of like.

• 1:11:51Speaker 01

  Outside DNA into your organism and. But what you want is to keep it like roughly in balance. I mean, you know, sixty forty, forty sixty, fifty fifty, whatever, but. Your high potential people also lose out if they don't have experienced people where it from. So that's a little bit. I think that was a big part of the stagnation.

• 1:12:12Speaker 01

  Again, it's not because the people, but this was something I was doing to my team. So it's not them. Or certainly on my watch. So but I think it's a dynamic you have to be careful of. Like, do we have the right? Balance of like, you know, people who are doing the who are like super high potential and talented, but doing their thing for the first time. You know, are they are they paired with people who have been there, done that? This is not the biggest job of their life and that they can help those people up the learning curve faster, such that the aggregate learning curve. Or the aggregate learning rate of your company is what it needs to be.

• 1:12:46Lenny Rachitsky?

  Man, I feel like there's a a book here of lessons for founders. Things that you never hear about until.

• 1:12:56Speaker 01

  Yeah, mine mine the seniority gap.

• 1:13:00Lenny Rachitsky?

  Like, that's one of so many, you know, people think about becoming founders, they start companies. I'm gonna start a company, there we go. And then, you know, they think about that first part of the journey that you talked about. And most people don't even get that part. And like, the best case scenario is you experience a ton of growth. And then, uh, like, the way you described it to me previously is like, you kind of hit the final bosses. Where you're showing all the success and then they're like, oh, I see, there's a big market here. Let's go after it. And you're battling Apple and Google and Microsoft and Meta. And a lot of people don't think about that and how that's the future, if you do well.

• 1:13:33Speaker 01

  Yeah, every time you move up a league, your reward is a stronger and better opponent and potentially even more on level playing field. So, and, and like, you know, that's just the way it is, like, you know, and you can't control that. All you can control is how you respond. And so you want your company's response to be to like embrace that challenge and use it as a mechanism to get stronger. Easy to say, hard to, hard to do.

• 1:13:56Lenny Rachitsky?

  Yeah. So maybe just to start reflecting on some of the lessons from this journey, because there's a lot here. Like, one question people may be wondering is, is should I, should I even be a founder? Should I start a company? You know, a lot of people, like, there's a lot of pain that you've been sharing of the challenge of starting companies. What do you tell people of, that are asking you like, hey, should I start a company? Is it my right to be a founder? Is there any advice there that you could share?

• 1:14:23Speaker 01

  I don't know what made me want to be a founder. I, I just sort of showed up that way, so. And, and so there's probably some like chemical imbalance of some form that causes people to do it.

• 1:14:36Speaker 01

  But I, I had a lot of kind of insecurity about should I be a CEO? And all, because coming from the technical side, so I can do the engineering and technology, but all I know about being a CEO is like, I do not know how to do all of those things that CEOs do. And I do not look like that, I do not talk like that. It's intimidating. So I think first is, you know, it doesn't have to be like an all or nothing decision. I mean, obviously, it's a, it's an all encompassing decision to become. To start a company, but you know, you'll have many points along the way where you can keep calibrating. And I think the biggest thing is, or advice I got from one of my, the founders of a company where I worked was like, I was like, oh, should I be CEO? Should I not be CEO? Should I be CTO? He's like, look, just try it. Be CEO. See how it

• 1:15:21Speaker 01

  goes. And initially I thought, I'm like, all right, well, I'm going to cut the company to like 100 million valuation and the trend will just be going faster and faster and faster. And instead of just getting thrown off of it, I'll just like hit stop and like retire. And what I, and I thought that sounded like a great plan. But then moving to the Bay Area, you suddenly meet like you throw a rock and hit 10 people who have done that. And what do you learn? Like this was just shocking to me because I talked to one of the advisors I mentioned earlier, he's like, yeah, the day I sold my company was the saddest day of my life. I'm like, what? You know, as a 24 year old and he's like, yeah, well, I just felt like the company had kind of drifted away from what it was supposed to be. And

• 1:16:04Speaker 01

  I just didn't like, I just, you know, I think they're sort of in the trough of the founder mode trough where you're sort of like, wait, things are like screwed up and it's on my watch, but I'm not really sure what happened. And what do I do about it? So I think burnout is the biggest thing that will sort of kill you. And so I think that's why like these coping mechanisms and like getting your own head right is important. But if you do that, then it's also this like amazing experience. And then often so many founders go back and start another company and another company. And you don't have to, but there's a, but there's a reason that people do that because there's just a lot of rewarding aspects of it, you know, building great things with great people that impact huge populations.

• 1:16:47Speaker 01

  It's like a really, what I found is that founders keep doing this because they love it in some way, or at least have like a love hate relationship with it, or can't imagine something else that they would otherwise be doing. And I'm probably the same way.

• 1:17:06Speaker 01

  So, but I think to get through that, you have to like, you know, Ben Horowitz also said, you know, the hardest thing for us, he has to manage your own psychology. And we've talked a lot about like, yeah, first you have to be aware of what your psychology is. And then, how do you make sure you're not like resenting or hating your company or yourself and view? I think the hardest thing for a founder, like, challenge is not optional. You're going to be challenged, but the suffering is optional. You don't actually have to suffer.

• 1:17:34Speaker 01

  I mean, look, there's like crunch periods or times where it's like taxing, but like, it doesn't have to be this like experience, like suffering all the way or burning out, or, or being really angry and sad all the time. Although, you know, certainly in my experience, that I did get in periods where I was just like sad and angry all the time. So you need to figure out how you work your way out of that.

• 1:17:53Lenny Rachitsky?

  So along those lines, I'm curious, so what, so you've shared a few things that have helped you level up as a leader and push through that. You've mentioned meditation, Bill Campbell, a coach. You mentioned a few books. What if, what has helped you continue to level up and stay ahead of where the company needs you? And it sounded like, you know, sometimes you fell behind, sometimes you were ahead. What are some tips for founders that are trying to stay ahead of where things are going?

• 1:18:17Speaker 01

  Well, I think first thing is like, anything, a theme that's carried throughout a lot of these different chapters is like, you have to like, figure out what game you're playing, and what the rules are when the game keeps changing. So I like, in addition to, you know, the Enneagram or coding, I also like a long time like video game player. And there's a, there's a great game called Star, it's, everybody's familiar with Starcraft. It's an awesome game. I think it has many lessons and riddles for an aspiring entrepreneur, many parallels with running a company. I'll save that for another one. But, but this idea

• 1:19:00Speaker 01

  like mindshare is like a big resource. It's not actually how much money or economy or land or whatever, stock or.

• 1:19:08Speaker 01

  Or like Actions. Military, yeah, it's like how much you can only do so much or think about so much like your attention. But that's actually not the big lesson that when they in StarCraft and other games, there's this concept of like, there's like a micro. There's micro and macro. And I would add to that, there's also the meta game. Okay, so what's that? So micro in these games. Some like StarCraft is like, all right, can you click really fast and like move your people and build things really quickly? And it's like the mechanics. Like every second, like how many, how many hundreds of things are you doing per minute? Or, you know, how many things are you doing per second? And that's sort of like a conditioning and practice and one kind of thing. Then there's the macro game.

• 1:19:51Speaker 01

  Well, then I could come back to the micros in a, in a product context or in a startup context, that might be things like. All right, how do I, it's often the stuff around like product design and technology and distribution, right? So, you know, early founders especially are going to be like totally fixated and like, here's how I make this great design. And here's how the engineering works and here's how we get users and here's how our sales motion works. Or here's how our like viral loop works or things like that. And it's very in the details. And then there's kind of the macro game. All right. So in StarCraft, that might be things like, well, yeah, clicking a lot is important, but overall you're really managing. Your economy. So do you have more expansions and resources than the other player? Are you building up your military? Are you getting your balance of the investment in economy and military?

• 1:20:36Speaker 01

  Rights, are you scouting? Do you know what the other person's doing? It's, it's more strategic and conceptual. So things in the startup realm that would feel more like that are more like. All right. Not just like the mechanics of like, how does this feature work, but more like, all right, what's the business model? What's the market? What's the, um. Who are my competitors? How do I differentiate myself? How's this all going to evolve over time as the category goes from like super high growth to more mature, things like that? And you know, you respond, they're okay, we gotta go from one product to multiple products. So they have to like reorganize the company that way and we blah, blah, blah.

• 1:21:16Speaker 01

  And then then I'd say there's also this, the meta game, which in gaming is like a pretty specific thing. It's like either some combination of the game itself gets updated so that, you know, as the creators like rebound, they make this unit stronger and you know, this area unit stronger and this ground we're you know, weaker and sort of like try to keep this big system in balance. And then also as this community of players figures out new strategies and sort of this big, you know, repeated game of rock, paper, scissors, people figure out, okay, this one strategy is now categorically better. And it's always this kind of adversarial thing that's always shifting. And so playing StarCraft in 2020 is pretty different playing StarCraft in 2015 or 2010 because everything, both the players are shifting and the game itself is shifting.

• 1:22:01Speaker 01

  And the game is usually not shifting a lot. So it's really more of a ecological effect. So I think it's like super important and then, you know, in a startup context, what's the meta game? Well, I'd say some of it is just like business cycles. So I think you'll have, as you see, like there's like this boom in the late teens in SaaS and in tech, there's a bit of an AI boom happening right now. It's not that different from what, or parts of it are not that different from what happened in the dot com era in, you know, 99, 2000, or the web 2.0 era in 2007 or others. And then you have these bust times like 2008, 2000, you know, 2000, 2001, et cetera.

• 1:22:44Speaker 01

  So there's like a market cycle thing that often has creates similar dynamics where it's like, you know, five years ago, every tech company was hiring the maximal number of people that it could. And then that created one talent dynamic. Now it's like a lot of companies are keeping high come flat or negative. So it's just like a very different thing. And so it's, but even those are kind of cyclical, then, then you want to identify like, how is this like game of like business actually fundamentally permanently changing? So for example, You know, we launched ASH. We usually do like a press thing, you know, conventional press, tech press. We got like almost no coverage for it.

• 1:23:27Speaker 01

  And yet, all the stuff we did on social or going direct was like way, way, way more impactful. And it's not just Dropbox or in tech, but it's also like presidential election, like these, all the candidates are on podcasts. Right? They're not so much. I mean, yes, they're on CNN too, but not really. So that's just like a new thing. Like, how do you, you know, promote, how do you manage the brand of your company or launch products? Things like that. The nature of marketing is changing. And that, and that changed when we, in 2007 too, like we, instead of hiring PR firms and buying AdWords and stuff, we were creating these like viral videos and we were using math, you know, using math from epidemiology to create these viral loops.

• 1:24:09Speaker 01

  In a lot of ways, Dropbox took that, transplanted that consumer playbook into business software. So. But the thing is like, you need to understand what game you're playing. And you need to get good at the micro. It's not that like the meta is more important than the macro. It's like, you need to do all three at the same time. And so that's really the hard part. And then when, when things are shifting, because I would. And, and the way you know what game you're playing is to be systematic about training yourself. And probably the single most useful, or you know, at least important to me. Piece of advice I could give is like, you have to figure out how to keep your personal growth curve ahead of the company's growth curve. Single most thing that's been, the single most important impactful thing for me has been reading.

• 1:24:54Speaker 01

  Because you know, talk about this micro, macro, meta games, sort of abstractions like that. This is the kind of stuff you can learn from history. You know, like learning what happened in Netscape ended up being pretty important to what happened to Dropbox in 2014. Learning what happened to Procter and Gamble and selling makeup. Ended up actually being pretty relevant. So I think having like a broad information diet is really important. And, you know, I've co-written a list of books that are really impactful to me. You can find a way to share that. All right. Absolutely. Share that. But, you know, in a lot of ways, you're basic, as a CEO, you have to be like right about a lot of things, especially in, including things you haven't done before.

• 1:25:35Speaker 01

  And I think from that perspective. At least, I'd say there's like things that are challenging for your head and things that are challenging for your heart. The head challenge is one that's more like, all right, how do you, you know, how do I cultivate wisdom really quickly? And so, you know, in addition to like a lot of technical books about here's how you do marketing or product or management or things like that. So it's can be kind of around like higher level, like almost philosophical. When it's saying, you know, things like Buffett or Munger or Bezos like would be more on that end of the spectrum. And then, but it's not just reading. I think having a community of people that you can learn from is really important. And I've also found it's interesting. You learn having kind of stable of people that, you know, are at the same

• 1:26:20Speaker 01

  stage as you, a couple of people, people a couple of stages ahead, you know, two years ahead, five years ahead, 20 years ahead. And this is founders, other CEOs. Other founders, yeah. Founders and CEOs, exactly. Because you'll learn different things from them. So first of all, when you're in the early innings, like you like, you actually get more like useful advice often from your peers because they're going through the same thing. So it's like, how do you raise, how do I raise a seed round?

• 1:26:49Speaker 01

  You know, you're going to get a lot more out of someone who did that like a year ago or is doing that now. Then like if I asked Zuck, like, how do you raise a seed round? He'd be like, I don't remember, just like build a good company. And you'll see that as you talk to people at different phases, like I think, you know, again, like the early, early stage, it's more about the micro, about the product and, and, and distribution. Then there's sort of this continuum to like, then it's about like your business model and monetization and the financials. Then it's about like defensibility and maintaining that advantage. And as you sort of talk to, as I talk to my peers, it'd be more about the product, you know, each, that's, that was kind of the scaffold I would see over founder. And then people that were like further out, like actually.

• 1:27:35Speaker 01

  They still knew all the micro stuff and like where they had feelings about it, but they're almost like philosophical in nature, like philosophers and just like very broad intellectually and like drawing lots of distinctions from lots of different things, like knew a lot about a lot. And I think most of the 10 year founders that I'm, you know, most of the founders CEOs who've been at it for 10, 20 years plus, I'm at 17. Like I, almost all of them read voraciously. So I think combination of like reading and community are the most important things. But then the last thing is being like systematic about it. So in line with, or what does it mean to keep your, this curve ahead of your, your personal growth curve and the company's growth curve? I think one way to do that exercise

• 1:28:18Speaker 01

  is think about, is always be working back from, right? Like in, in one year from now, what will I wish I had, what will I wish I'd been learning today, two years, five years? And often those to do lists are pretty different, right? So in 2008,

• 1:28:32Speaker 01

  I would have been focused on just like getting users for Dropbox, but then looking ahead to, you know, a year later, I would have been building like the first business functions in the company. And then five years later, I would be thinking about how do we fight with Google and Microsoft and all these other things. And then for my own skills, it would be like, it doesn't even like, how do I raise like a scaled venture round? And what are all these terms mean? And, you know, and things like that. But then, but then how do I be a great leader, a great manager, comfortable speaking publicly, things like that. And those, the things that are further out are often like the most intimidating, but you also have the most time to learn. And you often can psych yourself out in terms of like, oh, this is just like new

• 1:29:16Speaker 01

  and uncomfortable. And I just, it is one of the heart challenges. Like you're always going to have that feeling of discomfort. And instinctively, what you're going to want to do is, is run away from it. Cause you're human. It's like uncomfortable to like feel like.

• 1:29:33Speaker 01

  To confront these things that you're not good at, or it might be embarrassing or threatening. And so I think an important part of being a founder is like learning to run towards that feeling, not away from it. That's a big part of your learning rate. Is the extent to which you're like pushing yourself beyond discomfort. And then I'd say, and so like having that list of like, yeah, a year from now, two years from now, five years from now, what can I start learning today? And then recognizing these things, they're all trainable. So, you know, in five weeks, you're not going to be a great guitar player, or surgeon, or, you know, or manager, leader. But in five years, you can put a pretty big dent in those problems and, you know, people who enter college and leave college often have a lot more relevant knowledge after that experience, after those four years.

• 1:30:18Speaker 01

  So just sort of having that kind of growth mindset. And I'd say the last piece of it that is also tricky in addition, sort of like going from a kind of heart or mindset perspective. Is, you know, going towards discomfort and in addition to a lot of the other stuff we talked about, I mean, like, how do you have a sense of equanimity or not sort of burning out and finding a sustainable pace? I think the other thing is like, often, smart people have more trouble learning than than than otherwise. And there's this great article that I, it's probably my most handed out articles, probably from the seventies or eighties or something. Called Teaching Smart People How to Learn. Because what ends up happening is the more kind of book smart you are.

• 1:31:03Speaker 01

  Or the more you were sort of identified as like gifted or intelligent as a kid, the more that your that identity. The more like not knowing something or being wrong is not just like not knowing something or being wrong, it's like an assault on your identity. And so I found that one of the best predictors of an exec continuing to scale. It's not just how what they know or what they can do, but like the extent to which they can actually like be aware of their failures. And not blame or dismiss things because like smart people have a really fast rationalization hamster.

• 1:31:39Speaker 01

  Like they can convince themselves that, well, there was, here's how they were like technically right, even though like clearly they were wrong, or clearly the thing didn't work out. And they sort of let themselves off the hook and all this happens unconsciously, a sort of a protective mechanism. So I think finding ways to take responsibility or how always have like a mindset of like, what if I were like 100% responsible responsible for this? Like, what if it was no one else's fault? Like, what if it's entirely in my control? And those things are never true, but that's always in or with perfect hindsight, what would I have done differently? And just like owning things ends up being more painful in the short run, but then, you know, some painful hours can save painful years.

• 1:32:22Speaker 01

  And there's a great book on that mindset stuff, The 15 Principles of Conscious Leadership. Diana Chapman and some co-authors and she's she's been a coach and friend of mine. She's amazing and says, really helped me on that front, but really like, how do you train your head and train your heart? There's different things you do for each, but all in service of keeping your personal growth curve ahead of the company's growth curve.

• 1:32:44Lenny Rachitsky?

  I love how tactically your advice is, there's this piece of advice of like, think, what do I need to know a year from now? Two years from now, five years from now, this reading list, this idea of having staggered staged founders in a community to help you along this journey. This article about how smart people learn and how to get past this block.

• 1:33:03Lenny Rachitsky?

  So I love just like how concrete a lot of this stuff is.

• 1:33:07Lenny Rachitsky?

  So then just zooming out and maybe final reflections on this journey. As you described this, it's basically the epitome of the hero's journey that you've been on here. Things are good. Trouble appears, you enter this other land of everyone coming at you, trying to squash you in every direction, battling them and then emerging now into this new land with all the things you've learned. Kind of coming back to the original idea of what Dropbox could have been. So I think that's partly why it's so interesting is it's the epitome.

• 1:33:34Speaker 01

  But we're still gonna make it fully out of the, we're like on our way up. We're we're clawing clawing our way back up.

• 1:33:40Lenny Rachitsky?

  You got you got the, yeah, the dragon is still out. The incumbents still exist.

• 1:33:46Speaker 01

  Well, that's and by the way, that's like, it will always be like that. Like it's you're never like done with that, you know, there's always, it's not like you reach the A top. Or you don't have to if you don't want it.

• 1:33:58Lenny Rachitsky?

  Yeah, and it makes me think about as you're talking like people think about product market fit. And something a lesson from this journey is just like product market fit is not a binary. You will have it now, you've got it and you have it and will last forever. It's like constantly being broken by other people or if there's something you've discovered that is a big market. Any maybe final reflection on the story you've shared, things that might be helpful to people, just the journey you've been on that might be helpful to founders who are going through this right now, or will probably go through this.

• 1:34:25Speaker 01

  I think it's important to remember, we're all really lucky to be able to do this kind of work.

• 1:34:29Lenny Rachitsky?

  Right.

• 1:34:31Speaker 01

  And, you know, the things that I got out of the, when I was 18, the things I thought I would get out of starting a company would have been the things you would think. It would be like, oh, I'll be like, really well-known, or really rich, or build these awesome things. And, okay, I think there's benefits to that, but I think over, but what I've like, grown to appreciate a lot more is, over time, is, yeah, this thing, or the experience and the journey of starting a company can really be a forge for like, a better character, or like, there's transfer, a lot of what you learn here is transferable in many different domains.

• 1:35:16Speaker 01

  Like, you know, I just had a little kid, Charlie, he's one year, he's one year old.

• 1:35:23Speaker 01

  So, I know we're both in kind of new dad mode, but I'm like, it will make me, it's made me a better husband, it made me a better father, made me a better person, and so, and then I just, the last thing, like, there's, like, there's like, no easy button where things are just up and to the right. And so, like, don't look for one. And don't feel bad if it, if like, things are difficult. But ultimately, like, one of the biggest surprises about like, having, being able to spend time with all these like, interesting people and founder CEOs who've created these iconic companies, is, you know, at the end of the day, they do it because they love it. And, you know, and so I think learning to sort of decouple, that doesn't mean they're always

• 1:36:06Speaker 01

  having a good time at all. You know, most of them use metaphors, like, you know, Jensen or Elon, like chewing broken glass, staring in the abyss, and like, yeah, and yet.

• 1:36:19Speaker 01

  For a lot of these people, there's at the end of the day, like, nothing they'd rather do. So I think finding the gun that.

• 1:36:25Lenny Rachitsky?

  I'm very excited to follow the next chapter of your journey. I am really thankful that you shared these stories. I think this is going to be helpful to a lot of people. I think this is a story that people study for a long time because it's common and not talked about much. So Drew, thank you so much for being here. For folks that want to maybe check out what you're building, anything you want to share, where should they go?

• 1:36:46Speaker 01

  I'm just drewhouseston on all the socials and then, yeah, we got a new product, Dropbox dash, dropbox.com/dash. Right now it's for companies who'll have a downloadable version. You can just get on your phone or your computer soon. But yeah, plenty of this is awesome. Super fun. Really big fan of what you do.

• 1:37:05Lenny Rachitsky?

  Awesome. Same. Drew, thank you so much for being here.

• 1:37:08Speaker 01

  Thanks.

• 1:37:09Lenny Rachitsky?

  Bye, everyone.

• 1:37:12Lenny Rachitsky?

  Thank you so much for listening. If you found this valuable, you can subscribe to the show on Apple Podcasts, Spotify, or your favorite podcast app. Also, please consider giving us a rating or leaving a review as that really helps other listeners find the podcast. You can find all past episodes or learn more about the show at lennyspodcast.com. See you in the next episode.