ABOUT THIS EPISODE

In this episode of Startup School Radio, Y Combinator partner Kat Manalac interviews Suhail Doshi, the founder of Mixpanel
English
United States

TRANSCRIPT

00:00:00from the campus at the Wharton School in San Francisco is startup School radio
00:00:22welcome to start of school radio live from Wharton San Francisco campus on Sirius xm's Business Radio powered by the Wharton School I'm your host at me like a partner at Y combinator at YC we fund early stage companies and work with them to build billion-dollar business is coming up on Today Show I'll speak with to hail Doshi the CEO and co-founder of mixpanel at San francisco-based analytics platform for web and mobile apps they let businesses study consumer Behavior will talk to us about how he went from having almost no network in the Silicon Valley to building a data analytics firm now valued at 865 million dollars every year wifey we host a conference called startup school where amazing Founders tell their stories what they've learned building their companies the screw-ups the successes and everything in between this show brings Founders to you on a weekly basis we broadcast every Wednesday at 1 p.m. Eastern 10 a.m. Pacific run Twitter at Biz radio 111 and I tweet under cat mini Alec
00:01:22I'm happy to be join now by suhail Doshi the CEO and co-founder mixpanel to Hale started the company with the gold helping the world learn from its data today more than 3,500 mobile apps and websites using panel to analyze more than 50 billion actions every single month sale thanks so much for joining me before mixpanel you know you were in Arizona and how did you go from new kind of not being in a base you're having a network in the Silicon Valley to you know you started as an intern at Max election yeah that's right we start out in Arizona and before that though I internet a company that Max started back in 2008 and so I had just kind of got my early start meeting people in Silicon Valley for the first time just by working at a startup and
00:02:22yeah I was probably that was in between sophomore and junior year of college for me see you just applied to an intern and that's sort of how you you made her first contacts yeah exactly so just like most people in college most engineers in ecology apply to a bunch of companies and you see who will take you and I joined Mac startup because they wrote in Python I didn't know if I thought at the time and so I ended up joining a startup and that was really my first time ever out in Silicon Valley really out in San Francisco so that was I don't that was a very interesting time for me how did you kind of navigate as being you know you were 19 or 20 years old at the time so what now what kind of did you spend your time doing was just really like an incredible learning process I thought to myself there's this phrase that summer that this there's a phrase that you should work smart
00:03:22not harder so it's kind of curious about testing that that that sprays so what I thought was I wonder if that's true so what I decided to do that slide was to just work as hard as possible and to see if it matter so I wanted to just test the theory that if I just worked all the time would it work would it would I see the value but I was slide this meritocracy at the end of the day and so what I ended up doing is I went to slide and I don't really have anything else to do cuz I was out in Berkeley and didn't have a car and I don't really know anybody so all I really could do was work anyway so I take the BART into San Francisco and pretty much show up at around 10 and I pretty much wouldn't leave until 12 and occasionally I would take a taxi back home or something like that if it was past 12 so what did you find from from just basically working constantly
00:04:22I and I grew up programming for fun so it wasn't really a hard job for me but what I learned at slide was that people started to take notice that if I worked really hard and I probably also have to be pretty had to be reasonably smart I couldn't just work hard and not get very much done that if I combine those two things together that people started to take notice and there was just one moment where I remember slide had you know they have an all-hands meeting all hands is just when a bunch of employed the whole Max the CEO of the company or really important people to company will get up and tell the company everyone in the company what's going on and I remember that Max pointed out a product that I was working on and he said hey you know suhail and the door or they're working on this product and whole company like look back at us it was really weird because I was just an intern I wasn't hadn't been there for very long and it was very cool to be acknowledged in that way that is awesome so kind of figured out that it wasn't necessarily all about working smarter
00:05:22you also have to put in your time right you do have to put in your time but you do have to put in your time but you also I also learned that slide that you have to also be putting in your time on the right projects because sometimes if you don't work on the right projects if you're not working on the right things that African be very wasted and so but I did learn that if I could sort of combine both that people would notice that would matter and that was probably how I made my first connection to Max ever like how do you decide what are the best product new projects to work on a project and you hope that works in the first project that I was on it slide I wasn't super in love with a team that I was on it wasn't driving exactly the right way and then this
00:06:22project that I was put on when I moved to a team even during that internship I started to thrive in a project that was basically going nowhere so I was actually put on a worst project but I liked the autonomy and I like the people that I was working with so much that I was it was really very interesting to be able to drive that number from almost zero to something very interesting so you met slide at those at those two points I have learned how important working with the right team was as well what kind of interaction did you have with Max and and did you learn anything from him that you took you know with you when you left and when you started mixed so it was kind of weird because I didn't expect this interaction with Max I didn't expect to have any interaction with Max actually I just remember being pretty scared of being pretty intimidated being like this guy started PayPal a boy and I'm just this slowly in turning his company but it was kind of weird because eventually and I still can't figure out why Mac scared but eventually Max wood
00:07:22he would take someone of an interest in our project and maybe it was because there were fewer people involved in our project so he felt like he can kind of get involved without stepping on too many people's toes I recognize that now is a c yeah but but it also it was interesting because we would try to pitch Max or ideas and that was pretty cool because that was the first time where I could just sit in a room and Max's on the other side and I could pick him an idea about this product that I was working on and I can get his feedback or gave his input it's kind of interesting cuz it was kind of like it was it kind of prepared me to have to pitch to people later on because I got this chance to pitch this person that was very well known in Silicon Valley and just say hey do you think my Dopey ideas any good it was okay for me to disagree with Max I need to be comfortable with that eventually become comfortable with that was that an awkward process at first or how but I also got really comfortable
00:08:22rejected for Max to that so I got really comfortable rejection and being like okay well Max is something that's a very good idea alright so it was think of something better will come from so came from that internship as well strangely so that it's at Max's company they were very near torious and Silicon Valley in around 2008 for doing really very very sophisticated very Advanced deep analysis on how people are using a products did it kind of weird things like they would take their slideshow widget and they would shave them, telling me a story about how they would shave pixels off the bottom of the sideshow just to figure out how to increase the conversion rates just to find that Optima conversion rate of people sharing that's just really weird things like that I had learned about fishing for the first time I learned about finals for the first time I learned about retention which they called class curves over there and these are all very new very unique Concepts in 2008 most
00:09:22haven't heard it most of these things so I just remember sitting in a coffee shop and I remember p.m. at slide teaching me how to calculate coefficient which is just this equation that helps you determine how viral your app is or isn't and how close you are to making it viral and just being able to see the math behind how to make how to determine objectively whether your products were good or not just blew me away so it's like when I left I had thought that it was a bit silly that both slide in all of its competitors in the world we're building these tools and house that seem very strange why were they building internal tools when there are clearly the other hand of those companies in the world and so when we when I thought about that I thought it was odd there seems to be a gap in the world it wasn't clear whether that whether the product that they were building internally was large widely applicable but it just seemed like such a rational logical thing like wouldn't you want to know how people are using your products wouldn't you want to use the best metric
00:10:22to figure out whether whether your products are objectively good or not and that's what I took away from side so it was the fact that they were doing it all their competitors are doing and I thought why are they are building it what if we just built it and then they just paid us right so all of these you know larger companies were building these internal teams to build you know the software and house to build these analytics in the house and in your decided why don't we just do it in until it's all of them exactly it just seems silly because you slide had about 8 to 10 people doing data analysis for them full-time and then they had a bunch of infrastructure lots of servers and then they know my sequel server things like that and in so just seemed odd to me that you know you calculate all that in and you're going well besides spending like a million dollars a year just to do this thing if I could like do this for them at half the price maybe they pay that right see you go back to Arizona and pictures to your
00:11:22wonder how to cut is how did you meet and decide to work with your car by owner founder and Tim and I met we first met in Tipton was a computer science major and I was a computer systems engineering major and we both met in a discreet in this class called the discrete math class to learn discrete math together and he was in that class and the way they learn Tim was very straight with the way that I met him is somewhat strange in that they're all these other people that were that you had a program in this discrete math class so I thought to myself one day you know it seems like we should all like get together and maybe write code in like maybe build something together when it be better for us or do you want work on something together verses everyone kind of work not like math puzzles or right. And so yeah I kind of gathered these people up in the class and I said hey you know you guys want to work on something together and everyone was kind of like because I interesting Maybe
00:12:23kind of shrug their shoulders Tim was only person I was like when and where do you want to meet and I thought that was really cool and so that's that was the first time with him and I meant but eventually we just grab lunch together and I had already started mixpanel sort of it was kind of a project you're working on something during school so I'm able to make so much and So eventually too man I just had lunch together and he just became very interested and the problem with that the interesting thing here is that I didn't immediately just say Tim come join and part of the reason why was that I had to try to build a company after side before but before mixed-metal right in between for like 2 or 3 months and I just wasn't passion about that company or what I was building but I had also realized it was really hard to find a co-founder that I had found every time I found a co-founder of someone that was kind of interested in when I was building they were interested for about
00:13:23the second and then they be totally out whether that be because they wanted to go snowboarding or because there's some piece of work that they they had done but it wasn't necessarily going to be used completely yeah cuz we had switched switched ideas or something I kind of had just like I know I just written it off I kind of just said well I want to do something I'll just do it by myself for a little while and you know what maybe I'll build something and someone be interested and in it that's exactly what happened Tim became very interested and I had been working on it for very long
00:14:02so I hear you come just told him the idea and he was like that sounds cool I'll get by I'm at I think it was It was kind of just what are you working on and I told him hey I'm working on this analytics thing you feel that's kind of cool and then and then you know I'd say hey you know if you want to come by working this computer lab you know pretty much every evening and Tim was with me they're pretty much every evening Friday nights in college like we're both nerding out just came from the backyard and we're staying there till like 12 then we had dinner together it's college so you stay up later and and that's when he became more interested and so I said great well you know if you go build this thing then you can join in and I was really just my way of like saying okay I already gone already felt like I had met two people and they don't really show the right level of commitment very early on in a really built anything they just it wasn't it was cool for them for a week and then they were, like I've got other things to do now
00:15:0220 years old at this point starting mixpanel with your post on her I said some joints and then we have this idea of well maybe we should have played a y combinator we had a red Hacker News and so that's how we learn about Y combinator and we thought you know let's just put a nap and we are actually weren't really sure whether we wanted to do it or not because we didn't know that much about why come in her at that time that it was exhausted I would certainly exactly and so we thought okay let's Supply and let's fill out this application filling out the application would be healthy because maybe that'll help us understand our own business and supplied and kind of assumed that we probably wouldn't get in and you know that was the first app we had to like take a video of yourself which is very awkward and we were very adamant about it being 50 seconds instead of 60 seconds
00:16:02be under the under the minute bar and so we sent her a pin or, okay back to work and so in a long story short we were able to get into I come later and that's what that was that summer and so we had two options we could go internet a company we can get in really okay well we'll go in turn somewhere or if I come except maybe that's me that shows that we had a reasonable idea and we would just go do that for the summer and see where we get can you paint the picture look what was it like back then like what did Google analytics would like kind of the other people who are in the space now like we're there other you know big analytics players yes well it's interesting because we started me spend a week I would say that we like put together this very complex business plan and did like all this market research to determine what the comp
00:17:02she look like and what we could do but there was something that was important to us which was that when we started mixpanel early on we made this decision very early on that was let's not track page views and the reason why was because we felt that they're all these companies that already did this and who likes is pretty good they're still pretty good at it and and we thought to herself what Extra Value can be really add to the world if we track page views and this was somewhat risky at the time because it was very odd to building Oaks company that did not try Patriots the super stretch if you're just joining us on Cottman and Alec and you're listening to start of school radio I'm speaking with to hail Doshi the CEO and co-founder of next panel we're talking about how you know that he decided how he kind of thought about the competition at when they first started and how we decided not to track page views so so what is it you know so at the time did you get push back from your first users or did you say like hey like we're going to
00:18:02you know I'd much more value with with these like other elements or tracking what was kind of the thought process of building that first version of the product if we had any extra value because we track page use more so than something like Google analytics then we ought to do something else and if we can't figure out what that something else is well you didn't have legs anyway I'm deserve it dies, so it's kind of a harsh view of the world in terms of what we thought we should do in and so what we decided then was here like okay well you know with the Advent of Ajax and Web 2.0 websites are becoming they're becoming less page to page based it's not really like G if you kind of Imagine This like it's already like Geo cities were just clicking on these blue bright blue links and you're going to the next page anymore it's actually more like you're going to Pandora and you're playing a song but you're still there is no page load or you're on Facebook and it's looking through photos while you're not loading on your page just taking you to the Expo
00:19:01so we thought that was kind of we thought that that was the future we said that the way people are going to build things on in the browser it's going to be more Rich this is very obvious in 2016 yeah yeah you wouldn't expect anyone building a product any other way but this is when Web 2.0 basically happened and so we thought to herself as well if you can't you're not going page to page then how are we going to measure all these things that people are doing well and then we talk to ourselves with the right unit of measurement then it's probably an action in event something that's happening on that page and so we thought well let's just track engagement instead let's track the actions that people take and let's make it really easy to track those actions because those actions are probably more interesting than someone just going to a page in fact those metrics are better and oh by the way we saw companies like slide benefit from being able to track engagement so if someone to fold it was saying we can't figure it out and we can't get people to do this then
00:20:01server died and we'll figure out something else but if this does work which we think it could work this is somewhat logical let's just do this
00:20:09so how did you go about getting your very first customer that's the way we got our first customers is because because I I built a bunch of apps on Facebook or there's this thing called open social that no one remembers anymore that was started by Google it was kind of like the competitor to Facebook's at platform at the time and because I built all these things I had built this network of people that were also building apps and we we just talked about the apps that we were building and so a lot of our for some of our first customers just came from those people because I went to these app developers who are much smaller than slide and slides competitors and I said hey look you don't have the band with to build an internal analytics you don't have time to build internal except for in your company so what did I just do for you and you just pay me instead and I'll just give you inside so our first customer actually our first customer paid us like a hundred and fifty
00:21:09what is a month but we didn't have any why there was no product actually so what I did was I just gave him a piece of JavaScript and said here's how you integrate this project no Doc's know there's nothing I said here's how you do it and I'll do is I'll just tell you interesting things about your data reporting thousand consult for like a month and so I said hey look if you just I'll pay you pay me a hundred fifty bucks he paid through PayPal we can have there's no striped at this time either so you have to really build your own billing systems that meant that we would just use PayPal and you just pay the subscription Bell and then I would ping him on I am through g chat note to say everyday I just give him something new that I learned and I would clear the day to myself you were they just sort of in a in a vacuum like that they didn't have any of this information probably just do something like yeah they weren't really sure what was going on and so I really down and they
00:22:09oh thanks for letting us know we found a bug and they didn't know that that bug was causing other metrics to to fall down in at this time and even still today Google analytics doesn't really give you doesn't let you do instant analysis you don't get to see a real time view what's going on so for them they have to wait a day and then they'd find the bug where is I was able to say you have a bug now and they go and they were like okay great we'll fix that and they found the bug and they fixed it so so that time it was just us chatting and I get paid on a 50 bucks or servers were $60 a month so as far as I was concerned
00:22:46so so how long did you go through this kind of like unscalable manual process that I'm sure you're learning a lot from what point did were you able to automate yourself out of that system yeah so I was just I was while I was just kind of finding insights for him I was building the actual product as I just told him hey look will have a product that you can log into in about a month or so and so January 2009 was when Junior 1st 2009 is when we launched the first product that you can actually go log into and then see your data and so as soon as that happened I thought to myself well there this person will pay more money if he's going to pay me to just like paying him and I am so then we translated $150 a month into $500 a month and so then we were like wow and now we're not really running pretty profitably did the rest of the world hear about you or at least the rest of your early like first 10
00:23:46the next thing that we did after that was so we we paying them or after bell peppers just like him invited them into the product so we may be got like maybe our first five or so came from that just from our Network and then after that he's usually one man chops are or where they like teams and maybe like 5 or 10 what we ended up doing afterwards as we thought okay well how do we get more people that buy into this idea of tracking engagement versus tracking Pages because it we just tried to go after everyone that cared about pages that are product was deathly going to turn into something like that so we had to really think through like well there's a set of the world that believes in what we're building and there's a set of the world that doesn't yet understand it that we're going to have to educate the long-term we're still doing this today so many years later was still educating the market and so what ended up happening was there's this guy named Eric Reese and so a lot of people know Eric reset the guy that's kind of
00:24:46came up with the word Lean Startup and he gave us gave the world its idea of how you can build your companies and build software in a faster way than the normal waterfall model which typically takes a long a lot longer and so Eric popularize this and we bought into that Tim and I felt like that was this is before there was a buck it was just a bunch of blog posts on Eric's Xbox so what we started to do is we built a Twitter bot so what we did was he built I wrote some Python and I made a Twitter bot and I just basically followed everybody that was following Eric because Eric really Eric really vocalises idea of vanity metrics that you shouldn't be tracking and so we knew that people that were falling Eric bought into this idea so this is before Twitter had a lot of restrictions and so we just build a python bot and we are everyone fall every single person that Eric that was following Eric and then those people intern found out about mixpanel and so we probably got like another hundred users just from that
00:25:46that's pretty incredible so I've been speaking with the CEO and co-founder of mixpanel suhail Doshi coming up will continue our conversation with to Hale about you starting mixpanel joint a y combinator and you know how they grew from there I'm tight many Alec and you're listening to start of school radio on Business Radio powered by the Wharton School SiriusXM 111
00:26:09you're listening to start of school radio powered by the Wharton School
00:26:26what about to start of school radio on Business Radio powered by the Wharton School Sirius XM channel 111 I'm your host Catherine yellick a partner at y combinator for those of you just joining us have been speaking with the CEO and co-founder of mixpanel suhail Doshi we were just talking about how he got his very first user is a time and then you know his first you know 10 more hundred more by building a Twitter bot unfollowing everyone that follow Derek race was which was at a clever hack and I'm happy to Welcome to Hell back now I kind of wanted to to talk about so at this point I know you're you've built the first version of your product you're starting to get your first users are you in YC at this point so
00:27:13maybe I'm not sure that I remember it's kind of a blur I think so yes I think so is there any advice you got that stuck with you and continues to kind of inform the way you think about building your company
00:27:28who have to think about that yeah I think there's there's one piece of advice I think Paul gave us and gave our batch really that I think really stuck with us that I know resonated with us which was that Paul did this thing where he like Drew this is trying on the board but it you can imagine a triangle bit it being upside down so maybe a truck and what he did was he just basically said like the first thing that you should be trying to do is you should be trying to make a product that is not you're not trying to make a product for everyone you're trying to make a product that just makes a few very narrow city of people really really happy and if we can make a very small set of people happy then you can kind of broaden out the number of people that you make happy and just focus on those passionate people that care about your products and that's exactly what we did we sort of just said okay we're going to take all the people that buy into tracking engagement tracking actions the people that understand that tracking pages is lame and
00:28:28not the right metric I'm going to make those people as happy as possible and then we're going to continue to find ways to get more more people people who want to track engagement like what were ways that you went out of your way to make them happy and making love makes mantle so first I just started out if you don't have very many customers so the simplest thing I could do is add them all to Miami and then just paying them every day and just say how's everything going how are you how's business I think that they didn't expect me to just add them and start talking to them but I think they weren't I don't think they were put off by it I think they were just like okay and so then eventually you going to break them in and then you can get really really candid feedback and eventually they would start chatting with me then start picking me and saying hey this thing is broken this thing doesn't work your site's not loading for some reason so one of our first customers was this company called Jam Legend is basically just
00:29:28hero put on your desktop use your user keyboard as the thing that you'd play uses the guitar and so jam Legend was one of the first customers that had enough users that took out our site and they sent an update I wear eventually one of the founders got on I am and just said hey your site's not loading for me and so we were like okay you looked at we went to you know his estate make sure that it was loading and it wasn't until he was just getting this error and so that was the first time we had to look at our our product and go it doesn't scale oh no this isn't working anymore and so we just spent a lot of time with customers just trying to find exactly what they wanted in order to fix this problem that they had to even more I kind of did you feel comfortable with the product that you were willing to bring on a wider audience of people we were never really that afraid of bringing on a wide array of people in
00:30:28because it's so hard to get them actually so we thought about this as we just said you know I build projects before and I have I had learned that it just takes time to get a bunch of people to learn about you and use you and talk about you so we weren't really particularly afraid that we're just going to get bombarded with tons of users I think that's I think that's wishful thinking so early on we we always had a problem January 1st we had you could sign up for mixpanel anyone could sign up anyone could send us data and the reason why we did that was cuz we knew it was going to take time and so we wanted to build that word of mouth you wanted to build the awareness we wanted to build that incremental Ernest as fast as possible as soon as possible Market educate people that you know Paige be tracking doesn't make sense you know tracking engagement is much more powerful and you say you could have to do that today so what kind of you still have to do that and so
00:31:28things to do early odd to help people understand that tracking engagement and actions was was the way to go there a bunch of people that were popular in popularizing this idea that you shouldn't track vanity metrics like downloads and installs and pageviews were months that things like that number of users that have ever sign up for your service LinkedIn does that for example of a to say here we have 300 million registered users was kind of riding that wave and and and a lot of people can I help this inadvertently so we don't have to do a whole lot there but then we just wanted to start being more proactive about it 1-1 tactic that we started to use what was that we started to educate journalists that was very key so we did two things one was we had to get a journalist and to as we indicated in the educated PCS and investors
00:32:28because we knew that if he educate it both of these two parties that they would ask Founders and entrepreneurs what are the metric what are your actual metrics because we don't believe in these other ones so you know for example one person that publish something was loose gains when she was working at all things to eat and in conjunction with me and Mark we just called out we said company should stop tracking bullshit metrics we came out together and said that and so we started educating all these journalist overtime and saying hey you wrote something about how Lincoln has registered users that's kind of silly like doesn't it matter how many actors they have and this is such a logical thing to people that it's not particularly difficult to not come back who cares and so we did that and then we educated investors we tried to make sure that an investor was like this because they liked it because they already kind of they were seven up to realize this but
00:33:28it was kind of hard for them to push entrepreneurs necessarily to all care about it right so what does day got better they got better numbers for them to evaluate the businesses and we liked it because it forced the founders in the businesses in the world to track better things and then by mixpanel use mixpanel for that and somebody convincing these two parties were able to get a huge portion of Silicon Valley to get to the point where they go yet no one no one in Silicon Valley no one here is talking about how many pages they do or how many registered users they have anymore how many downloads are really doing nobody cares and you really loud that charge I think that that there are people that that led that charge at first and then we were able we were like work company to help like really really hard push that that that idea it's hard for me to remember at this point like when people really like relied solely on page views or just need a registered user that seems yeah yeah
00:34:28it's incredible how how far along the value of the valley at the very least just come here I came from publishing where you know for a long time the only thing people ever tracked was was Paid Dues and now I think you have much more like Rich data weird adversity to from journalist because it was some it would be the biggest contention was that the journalist generally measured themselves on page views right and so they were like what what do I track then yeah I was just like hard question of will what should be tracked because we tried pages and so we had to kind of come up with clever ways to say well care about quality for content right care about other people are reading what you're writing so maybe what matters is whether people are reading it so maybe one way that you can measure it how far does someone get in your article right things like that like we do that at me spend on our block how far after 5 Seconds does someone get on their blog do they read it so we start at 3 it's a really convincing the reporters who are used to that idea and not much work
00:35:28uncomfortable moment there for that as well I'm so right after y c u raise a round of funding and 2009 the great you know recession economic downturn what were those initial conversations with investors like very bad and it was when was the recession really was full underway you know so you know what we raise money about your raising me about 6 months after the recession so things are particularly but we're bad and I remember I'm a room he first joined the Y combinator I remember Paul and Jessica were sitting and hit just join my clan made it was like the first meeting and I just remember Jessica saying something along the lines of so investors
00:36:18are still investing
00:36:20and if that was just I look back at that moment and that was supposed to be there at the secretary positive moment but when you like compare that to even just last year you're never expect anyone to be like to have to reaffirm you at right this is there still investing okay good they're still investing but it's bad because
00:36:42two reasons one was that and then to the second reason was that Tim and I were certain we were very much nobody's you weren't your classical cliche MIT X Google p.m. that was like about to go start a company and had this track record at least maybe had raised my previously maybe had an exit under our belt in fact if anything it was the opposite of us like we were we came from Arizona state which is not as prestigious MIT or anything like that you were 20 years old we had no prior experience for me and him is really our first working experience I don't think I'd internship really counts so is our first job so that was really hard and we met 11 or 12 V Series 2 of them wanted to give us a CEO right off the first meeting like literally saying
00:37:42so we I think we need to find you guys a CEO and Tim are looking at each other like who's Co who's being replaced as the CEO was like somewhat unclear at this point people were dragging their heels so it was particularly bad and there's this point where we were about 1 week away from Death we weren't really sure we're going to be able to raise any money and we only had like 15 k for my comment or at that point we really cheap I think about 50% of that within we say we I think we only spent 50% of 15 k / 9 months so we were really really very lean while you're trying to be cockroaches and and it's only one week away from death and Max kind of came in and at the last minute we were able to get money from Maxim Michael Birchmere is half a billion dollars
00:38:37if you're just joining us I'm cat many I like and you're listening to start of school radio I'm speaking with suhail Doshi the CEO and co-founder of the data analytics startup mixpanel we're talking a little bit about their first experience raising money in 2009 during the Great Recession when you know there were a lot of difficulty for early-stage companies to raise funds and so you know so you were saying you were about a week away from that you know you're about to run out of money though you you'd only spent half of 15 K over the course of nine months which is incredible and I want to kind of ask you how you did that you don't invest can eat I want to talk about this a little bit because I think a lot of early stage companies that are going to be raising money in the next year or two are going to face some similar challenges I'm with fundraising it's going to be a little bit harder to get that early stage Capital so what did you do where there specific things you did to it to stay really lean to keep it burn low and that first year
00:39:37one thing to consider is that Tim and I are 20 so are relative experience of living luxuriously was living in a dorm room in college so you're living a better life. But we did a couple things one was we had a crappy apartment at the Space Coast Shoreline Shoreline Village in Mountain View being a mountain view is cheaper than being in San Francisco that's one way to be leaner we had a one bedroom apartment not a two-bedroom apartment which I don't recommend I don't necessarily recommend cuz you might you that may create unnecessary tension with you and your father but we had a one bedroom apartment where you know Tim had a futon on the left and I had an air bed from Walmart on the right middle lamp in the middle only have picnic picnic utility tables in the living room we had a $200 a month grocery budget per month each and so we ride our bikes to Safeway and put groceries on the handlebars and restart the service from her Android phones if they were down only bike back
00:40:37and my mom I think of the time she she was a financial analyst use a finance person Buy trade-in so she kind of helped us with our finances a little bit and make sure that we were burning very little money we leveraged all the Partnerships that we could that y combinator gave us so for example Rackspace had this partnership back in the day would like um matter where we basically were not paying any money for servers so leverage that as much as you can cuz that end up being one of our biggest call centers early on servers cuz Renee likes company to leverage all the free stuff that you can get because all these people want to partner with people like like I matter and and just don't spend a lot of money you know be smart about every dollar that you think about you know make sure that it's counting and then use your time as white as soon as possible because you don't know every day counts for you to be able to get the contraction that you need to be able to raise money and then
00:41:33that's how you save money and how you raise money what kind of advice would you give to people who are going to be trying to raise money this year if if they kind of face similar Roblox add to the ones you faced a lot of people you know when you go out and raise money and then you announce how much money raised or if you decide to announce what your evaluation was a lot of people think that that is destroyed overnight thing that was easy simple but actually risen when he was never easy for mixed men I was always been hard it's always been we never had one of those oversubscribed hyper-competitive rounds that you sometimes read about into crunch barely an indicator that you will succeed and be the biggest company of all time even if we just have supposedly this easy or subscribe
00:42:33straight but people really didn't like me to be at that time people hated an analytics company and there's no way that they really believe in these two twenty-year-olds you know damn well I guess we're 21 but the point is to really young Founders from Arizona state that had never bought the company before I get them to to convince them like this you know and I'm sexy and I know it sort of B2B analytics companies is going to work is going to make it
00:43:06I don't not sure that I ever found that thing that you say but what I did find was that that the people investors that you talk to you it sometimes comes down to traction like you're unbelievable traction all things are forgiven as raising its around and I know a few people that were close to that round and all kinds of growth were forget all kinds of sins are forgiven if you have a cigarette but even if you have good growth you still have to fight and you still have to be very persistent semi at my Christmas advisors usually just have to be really persistent you have to not you have to be okay with rejection you have to not get demoralized and have to recognize that you might talk to 5015 people ever talking to Max when we're having a hard time and he was like I Pay Pal they were talking like 50 people I couldn't even imagine talking to 50 people cuz I already felt burnt out talking to 15 and so the biggest thing that I had realized was that it ended up being you don't when you raise money you don't need everybody to say yes I need
00:44:06one person to say yes and usually what that what matters to people is whether they're interested it's as simple as that it doesn't even sometimes come down to how much money you want how much money you want to raise and and sometimes it doesn't matter what your background is how much traction you have sometimes it just comes down to do they care about your idea do they think your idea is interesting because they know as a message that they're going to be spending time with you spending time with you on your company and if they're not interested put yourself in their shoes for a moment imagining you were talking to a Founder who is building like I don't know janitorial services as a service animal not be the most interesting start up to you you might go I don't know that I want to like learn a whole lot about that business did you find those people that you thought would be really interested that you can really engage with because we started targeting investors at first you know after rrc drowned start charging a message that we thought were that were interested in Alex that wrote blog post that exemplify things that we cared about
00:45:06but the other thing was we got rejected from them and so that was kind of like a big block or saying well that's really odd and so you know when we raise money for Max the thing that Max is really interested in was he was really interested in he brought analytics decide I mean obviously he hired like you swing a million dollars probably so he was very interested in that for his own company and then secondly Max is very into quantifying data and if you look at the the set of companies that is working on now you can see that you can see that with glow you can switch is helping people get having people helping people get having a baby and they're very quiet the ra quantify their quantifying that to really crazy level and so max is really shouldn't data is releasing quantifying things and so that was a very obvious like in nature choice for him to go I believe in this thing where you talk to someone that was maybe very consumer-based and didn't care a lot about you a lot about intuition and design and user experience and things like that all very important things
00:46:06you wouldn't be able to convince that people like that I would be very hard because they don't get they don't get it I don't understand it and if they understand it's hard for them to understand where it's headed to bed about you were you know you come a long way since your razor first round and at that time you were may be 21 and you're still a relatively young person to be running a B2B Enterprise company and so I wanted to think about like I know in 2014 you you brought on you a sales exec from New Relic as I wanted to think about what it's like being a young founder and CEO and how do you attract entire top talent and how do you work with Executives if it's often there are no considerably perhaps older than you or have more experience at this is as you were saying your first job so how did you learn to go through that process of hiring
00:47:01yeah so. The hardest thing as a young founder is that you are still sort of waking up to the world you are effectively maturing in your own mind and you're definitely maturing at an accelerated rate in some out in some ways in other ways are not but in many ways you are Tim and I generally think we're like about 5 years older than you actually are because of having to run a company you have to be very responsible and so and so this can be tough for young Founders because you are you're not immune to all the things that everyone else has to learn how to do from 2230 think about like how you how you have personally changed from 20 to 30 people changed a lot so I think the biggest thing that you have to show people is that you may not hire the absolute top to your talent unless you have unbelievable unprecedented
00:48:01said I grow roses can be forgiven you you might not be able to hire all of that top tier Talent when you're 22 or 23 and so you can have to make do with what you have and you have to kind of keep improving and upgrading from there constantly but I think the biggest thing that you have to show people in the world is that you were a self-improving machine that you're good at listening you're good at recognizing mistakes that you make your good at recognizing that you have flaws and that you have to change I think all young Founders have this problem I think when you read about Steve Jobs and is very earliest days mean there's this guy and he didn't wear shoes he was a fruitarian he smell but refused to tell other people that he smell you refuse to believe that he smelled anything about Steve Jobs when he got older and how people describe him later so two different to different people same people talked about the way Bill Gates conducted his meetings back in the day and awake and exes meetings now
00:49:01totally different you would tell people that their stupid basically it's an old time article that I wrote and so all I think all young Founders go to this transition where they're learning that they have to relearn have to learn how to work with people that have to learn really important social skills that they may not yet have even if they're super extreme rooted in very social and so you have to maybe your first employees wear the first maybe executive kind of folks that you bring in your first person that you are I mean you're going to have to show them that in the interview process and you're going to have to really build a strong relationship so you know when we hired are head of cells whose from your eye like we me and Matt talk a lot we talked a lot and to get him comfortable how long was that process just I think we may be met like 20 or 30 times right around the block maybe 10 times we met 5
00:50:01times we have to really get comfortable about our expectations together and see what you might have to do is you might have to spend a lot of time with them and have to recognize that the reason why you do is because it's your job to kind of get them to be really comfortable so for example I still do that now I still have to do that where I still need people probably 10-15 times just to make sure the other couple just to make sure expectations set just to show them a history of improvement over time how big are you now how many employees are involved in the person anymore but the most important thing you have to do when you go from 0 to 20 is you start having to build a process by which you can ensure that the hiring bar is maintained from a time were you were interviewing everyone so I mix final I made sure that I interviewed the first hundred people in the company because I felt that if I interview the first hundred people in the company that that would set the tone if you very
00:51:01hard for us to lower the bar be very hard to substantially change the culture be very hard to do things because those hundred people would be the core of the people that would keep our culture alive the people who would end up hiring everybody else exactly and so that was really cool it exactly they're still interview questions that I had asked the first hundred I found out yesterday where we still at people still ask a question that I used to ask to ensure that the quality bar is really high just for our even our own customer support teams last question is what advice would you give to someone starting out today I think the best piece of advice I have is that I didn't recognize how much my job in my roll
00:51:49would change in the company when we first started in to give you a sense of what what I mean by this I think that most Founders don't realize this they don't recognize this yet which is that you start out being the person that might write code and you start writing and you're the kind of person I might be writing thousands of lines of code every single week your individually contributing a lot it's very intent to work as hard as you want but as the company grows Your Role changes and you go from being the person I was in the major contributing to managing and going for managing to managing managers information managers to manage me executive and that your company is going to need a set of things systems process these policies if you're thinking you're mine yuck that's why I started a company you should recognize that those things are going to be things that you need along the way and a lot of Founders were ejected
00:52:39when they're going from 0 to 20 people and you have to learn how to embrace those things over time. Mix panel.com and you can follow suhail on Twitter at suhail if you have a question about something you heard on Today Show email us at Business Radio at siriusxm.com thanks for joining us today thanks for producer Dan a cash and Associate producer and engineer Dion Simpkins be sure to tune in for another addition of our show next Wednesday at 1 p.m. Eastern 10 Pacific I'm tapping yellick and you've been listening to start of school radio

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