As 2022 draws to a close, we’re reflecting back on some of the most impactful discussions we’ve had with the top leaders in technology and business. We’re fortunate to have spoken with people hailing from a variety of industry sectors who have generously given their time and expertise to provide guidance, insight, and illuminating anecdotes to entrepreneurs.
We’ve compiled excerpts from 22 of our most popular podcasts aired in 2022. These interviews encompass a wide range of topics — from insights on specific sectors like artificial intelligence, cybersecurity, web3, and commerce — to tactical guidance on recruiting, leadership, and fundraising from experts who advise founders every day. Guests include iconic leaders such as OpenAI’s Sam Altman, Cloudflare’s Michelle Zatlyn, and Nike’s John Donahoe; and industry experts like former New York Times Cybersecurity reporter Nicole Perlroth. We also have plenty of operational advice and domain expertise from Greylock’s own investing team including Reid Hoffman and Christine Kim, and guidance from the leaders of our talent and marketing teams.
You can listen to Greymatter’s “Best Of” podcast at the link below, or wherever you get your podcasts. The transcript follows after, where you can also find links to the full episodes from which the excerpts are taken.
Entrepreneurship, Leadership, Fundraising
Our first section of this podcast will be focused on the core principles of entrepreneurship, leadership, and fundraising.
Reid Hoffman | The Philosopher-Entrepreneur and Philosopher vs MBA
We’re opening our “best of” episode with clips from a discussion on one of the most big-picture, existential topics we’ve covered on Greymatter. This two-part episode features Greylock general partner Reid Hoffman and his Blitzscaling co-author Chris Yeh discussing how academic pursuits impact entrepreneurship. The full Philosopher-Entrepreneur podcast is here, and the full Philosopher vs MBA episode is here.
Philosophy is something that is very important for understanding humanity – an understanding of, “What are the big ideas? How do we evolve as individuals in a society?”
And when you look back, you see most people tend to be very blinded by the now. They tend to think “Everything has always been like now,” or maybe they were a little bit more barbaric, but they don’t think necessarily back to the evolution [of ideas], back when kings were thought to be gods, and that the evolution of religious systems, the whole notion of human rights and when you were focused on being part of a tribe, and even the evolution of nation states. So all of that evolution of thinking – including the birth of science – all come and start with philosophy.
Aristotle was perhaps the first for me who really opened my eyes to how important philosophy is to thinking about human beings, and part of the way that traditionalist philosophy was understood was this contrast between Plato and Aristotle. Plato was very classically about the ideas and the pure mental landscape depicted in the Metaphor of the Cave and thinking about “What are the pure forms and essence of things?” [This idea] that actually the world around you is kind of the projection from these pure essences.
Whereas, Aristotle – and this is part of the reason that it’s so important for entrepreneurship and for me personally – was this idea that actually philosophy starts with the study of the world. That we are embedded in the world.
That’s part of the reason why one of the things I’ve said about entrepreneurship is that it embeds a theory of human nature. What is your theory about how human beings identify themselves, connect with others, consider themselves to be part of a group? How are they motivated by ideologies, by emotions, by desires, by appetites? How are those things put together? What are the questions when they are pursuing a theory of the good (because everyone is a hero of their own story)?
One of the other areas that owes its origins to Aristotle in my thinking is that I have this favorite quotation about theory and practice that “In theory, there is no difference between theory and practice, but of course, in practice, there is.” That’s also – when you look back to the earliest records of philosophy – Artistotlian. Because that notion of “revise your theory by engagement with the world.” Engage the world to generate your theory, have your theory and apply it, and then that loop between the theory and practice.
Because, ultimately, what I get to is the idea that it’s a combination of theory and practice is what is so impactful and important. It’s also part of the reason why theory generation – the theory of human nature, that having an investment thesis of the game in your entrepreneurship all comes back to this philosophy as a practice in the world which is very Aristotelian and part of what makes Aristotle so central to how I think about philosophy’s importance to entrepreneurship.
The orientation towards people who select going into MBAs (generally) and management consultants (generally) is towards things that are adversely selected in entrepreneurship.
“In a very broad brush, entrepreneurs have a tendency to just go do it. Get in motion. Whereas, frequently, in MBAs, they are really trying to reduce risk, not take it.”
You say, “Well, I don’t have X, that’s fine. I’ll pick up X along the way. I’ll hire someone, I’ll pick up the resource etc etc.” So most entrepreneurs are like, “It just needs to be built.”
Whereas, frequently in MBA management and consulting, it’s a weigh stop between a better a job, better preparation for the future, towards a guaranteed minimum outcome (“I’ll be paid at least this”). Those kinds of things are most often why people go into them. They are also not doing, not building. They are really trying to reduce risk a lot – not taking risks.
Entrepreneur First | How to be a Founder
While the world (and especially tech hubs like Silicon Valley) are awash with incubators and accelerators, U.K-based Entrepreneur First has built something very different. By focusing on connecting individuals rather than defined teams, they’ve gained a unique perspective into what makes good ideas, and how the right co-founder dynamics can bring it into reality. Entrepreneur First co-founders Alice Bentinck and Matt Clifford published a book with some of the top lessons and insights for founders around the world, and joined Greylock general partner Reid Hoffman to discuss. You can find the full interview here.
Our core belief is that entrepreneurship is an extraordinarily versatile vehicle for change in the world.
I think one of the things we love most about our jobs at EF is that we not only get to work with extraordinary people to start their journey, but that the impact they want to have in the world varies so wildly. Some people want to bring about closer human connection through social networks. Other people are trying to remove carbon from the atmosphere through genetically modifying algae, and it’s all entrepreneurship.
I think one of the really great things about living in 2022 is the fact that there is now a global startup ecosystem of co-founders, advisors, investors, et cetera. Means that there is a toolkit that is actually quite common across a huge range of different kinds of ambitions.
And so whenever I want to feel pessimistic about the future – which is never – I open a newspaper. But when I want to feel optimistic about the future, I look at what the entrepreneurs in our portfolio and beyond are doing to solve huge problems. Those problems are so wildly different, and yet the common themes are around being willing to envision a better future. And then to use your phrase, “Build the airplane on the way down,” I think it’s hard to look at people doing that and not feel optimistic about the world.
We might have spoken about this when we were on the podcast last time, but we were surprised during COVID to see applications increased to Entrepreneur First. That was not what we were expecting. But when you look at entrepreneurial individuals, they see opportunity in change and they see opportunity both from a mercenary point of view, but also from a missionary point of view.
And we talk about this a little bit in the book, this idea that actually, the best founders have this combination of both missionary and mercenary, it’s not enough just to be attached to a cause. We’re not building charities here, and it’s not enough just to be motivated by the financial side of things. You actually need to be one of those individuals who’s looking at the intersection of the two who says, ‘Yes, here is a change.’
And with COVID for example – a very negative change where actually the opportunity was – [these individuals said] “How do I support people? How do I create products that allow and enable remote work? That enable rapid testing? Whatever it may be, but I’m building that, not because I want to build a charity, but because I want to build something that is highly scalable and globally impactful.” And that’s the mercenary side of things, a business without a business model often doesn’t last that long. Well, there’s a lot of VC money around, but ultimately there should be some sort of business model.
“Our core belief is that entrepreneurship is an extraordinarily versatile vehicle for change in the world.”
Julia Boorstin | When Women Lead
While there may be plenty of discussion about the disparity between funding for women-led startups and those led by men, women still receive just 2% of all venture capital funding. And yet, many women are still finding success as entrepreneurs. How? CNBC Senior Media & Technology reporter Julia Boorstin dug into the stories of women entrepreneurs founding, funding, and running companies, and uncovered a variety of smart tactics and approaches. She chronicled her findings in her book When Women Lead, and joined us at Greylock for an in-person discussion. You can find the full interview here.
The reality is, people can succeed by leading in all sorts of different ways.
[In my research] there was not a singular model of leadership that worked across the board, but I think that the women succeeded by finding leadership traits that were really true to who they were and saying, “this is what I’m good at, this is what I’m not good at. How can I take what I’m good at and develop that and really push myself to figure out how to be better at that trait? And how can I surround myself with people who complement me?”
So I think that idea that any of us has leadership traits – maybe even some traits that we think of as flaws – can be developed into leadership superpowers. And I think of the women who are self-professed introverts and figured out how to use that to their advantage, or super empathetic and figured out how to use that to be better at connecting with their employees and customers. So I think there is not a single model but this idea of knowing yourself, figuring out what you’re good at, getting better at it, and really pushing yourself. Not to compete with others, but self-competition is really essential.
Nike CEO John Donahoe | The Next Play
Unsurprisingly, a large part of Nike CEO John Donahoe’s approach to leadership comes from his lifelong love of sports – and admiration for coaches. Some of his most influential mentors include coaches, from his high school basketball coach to legendary figures such as Phil Jackson. Throughout his career, Donahoe has been known for his relentless push for wave after wave innovation. He discussed his approach to leadership with Reid Hoffman as part of Greylock’s Iconversations speaker series. You can find the full podcast and transcript to this interview here.
I think curiosity has to be at the top of the list. [It’s] one of the things I learned earlier in my career at Bain. I was a consultant for like 20 years. And what I learned there is “always be outside-in,” because I was never part of a client organization. I had to understand things through the eyes of the customer, through the eyes of competitors, through the eyes of other stakeholders. And those are the cues of where the puck’s going. The puck isn’t made up inside a company. The puck is defined by where the consumer’s going and wants to go, where competitors or disruptors are coming up and giving different offerings. What’s happening in the overall [picture].
So keeping a real outside-in mindset is, I think, essential.
“The biggest danger of success is you stop being curious. And success, like the biggest risk, is rapid success. I think that’s true for any organization, any leader – it’s human nature.”
Solv’s Heather Fernandez | Purpose into Action
When it comes to increasing diversity in tech, the time to take action is…always. In late 2021, Solv C was wrapping up fundraising for its Series C round. Everyone was ready for a well-deserved break. But what started as a celebratory call between EO and co-founder Heather Fernandez and investor and longtime friend Kara Norton turned into an ambitious call to action. Having discussed the longstanding issue of lack of diversity in tech for years, Norton and Fernandez decided to seize the moment through a different approach: re-open the round with the addition of a special purpose vehicle (SPV) designed specifically to add more women to the Solv cap table. She joined Greylock marketing partner Elisa Schreiber to share her playbook for SPVs. You can listen to the full conversation here.
My great aspiration is recognition by founders that this is an option. This is a viable option that you can think of as part of your overall financing process. That, to me, would be a huge win. And my hope is that this playbook is helpful to the next founder or investor who’s looking to use the SPV to diversify their cap table.
So, first, I would say commit to the plan upfront as part of your fundraise. Decide what you want to do, speak to your board about it, build it into your internal team’s plan so it’s not a last-minute scramble (as it was for us).
Number two, tap your networks as founders and entrepreneurs. You have an incredible network already. So whatever the purpose of your SPV is, you likely already have the people in your network to help you get there.
Third, you need a back office success partner, but line that up in advance.
Fourth, set limits. In our case, the limit was time. In your case, the limit might be dollars invested, it might be time, it might be the number of investors, but establish what that is upfront to prevent the chaos that can ensue later on if you end up being quite successful. Actually (and I think this was one that specifically worked for us), is reduce the minimum. I was scared, but with the right tools, with the right success partner, with the right people in my network working to make this happen, reducing the minimum just opened up access to people who otherwise might be more intimidated or not actually have the financial capacity to write that bigger check. So as long as you have the back office and the toolset, it’s very possible to make that happen.
“This is a viable option that you can think of as part of your overall financing process.”
This next section is devoted to artificial intelligence, which is a major focus area for the Greylock investing team. 2022 was a significant year for the sector, with many advancements in large language models, autonomous vehicles, robotics, and more.
OpenAI’s Sam Altman | AI’s Next Era
Our first podcast excerpted in this section is an interview with OpenAI CEO Sam Altman. The AI research and deployment company’s primary mission is to develop and promote AI technology that benefits humanity. In 2022, the company made major waves in the sector with the release of generative transformer model GPT – 3, which uses deep learning to produce human-like text, and its image-creation platform DALL-E. This interview took place during Greylock’s Intelligent Future event, a day-long summit featuring experts and entrepreneurs from some of today’s leading artificial intelligence organizations. You can find the full interview with Sam Altman here.
I think language models are going to go just much, much further than people think, and we’re very excited to see what happens there. I think it’s what a lot of people say about running out of compute, running out of data. That’s all true. But I think there’s so much algorithmic progress to come that we’re going to have a very exciting time.
Another thing is I think we will get true multimodal models working. And so not just text and images but every modality you have in one model is able to easily fluidly move between things. I think we will have models that continuously learn. So right now, if you use GPT whatever, it’s stuck in the time that it was trained. And the more you use it, it doesn’t get any better and all of that. I think we’ll get that changed. So I’m very excited about all of that.
And if you just think about what that alone is going to unlock and the applications people will be able to build with that, that would be a huge victory for all of us and just a massive step forward and a genuine technological revolution – if that all had happened.
But I think we’re likely to keep making research progress into new paradigms as well. We’ve been pleasantly surprised on the upside about what seems to be happening. And I think all these questions about new knowledge generation (how do we really advance humanity?) I think there will be systems that can help us with that.
Mustafa Suleyman | A Pioneer in AI
In early 2022, one of AI’s leading researchers and entrepreneurs joined Greylock: Mustafa Suleyman. Mustafa is best known for co-founding DeepMind, the world’s leading artificial intelligence company that was acquired by Google in 2014. After the acquisition, he went on to work at Google as VP of AI product management and AI policy. Shortly after joining Greylock, Mustafa , Mustafa and Reid Hoffman announced they had co-founded an AI-first consumer products company called Inflection AI, which is being incubated at Greylock.
In this interview, Mustafa and Reid discuss the major developments in AI over the course of Mustafa’s career that have shaped his outlook on the field, and which serve as the foundation for his next steps. He also discussed what he’s looking for as an investor in AI companies. Reid Hoffman speaks first. You can find the full interview here.
There’s no question that at least in five years time, these technologies are going to be completely ubiquitous.
In fact, if you think about it from a founder’s perspective, these are like a new clay. They’re the new tools that are going to allow us to create all kinds of new experiences. The fact that we will be able to generate perfect audio, perfect images, perfect text, even video, and be able to control the way that is generated rather than hand-scripted, right? You should be able to give an instruction in natural language for the generation of this new content. I guess, your imagination is the limit of what can be produced.
Google’s James Manyika | Social Intelligence
Google’s first-ever SVP of Technology and Society James Manyika joined us for a discussion on the various ways technology impacts business, global economies, culture, and humankind. Manyika is a renowned expert in artificial intelligence, robotics, and globalization, and has been a highly-sought out advisor to many of the world’s top tech companies. He spent nearly 30 years as an advisor at McKinsey Global and has held numerous board and consulting roles across academia, nonprofits, and government. You can listen to his full interview with Reid Hoffman here.
I think, despite our collective exuberance about these technologies, there are some major limitations, and, as I said, some hard problems. But I think it’s worth dwelling a little bit on the limitations and gaps, before we get to the truly hard AI problems.
I think the limitations, most of them have to do the things that are likely to erode public trust. And a lot of those include things like bias in algorithms or in the data or the copra that I used to train them, questions about brittleness, for example, in the systems. This issue of when you have outer-band distributional non-stationarities, for example. When you train the datasets on these sets of things, and then you suddenly present them something out of distribution, it makes different predictions. And also the issue of explainability, because from a trust building standpoint—
What I often find interesting, Reid, is that often people who don’t understand the technology, outside the tech industry, think that the tech industry is trying to hide something on explainability.
No, it’s just that the neural-network structure, the structure of these algorithms, are such that you can’t actually open it up and say, “It made this decision, because of this particular variable, that particular variable, or this data set” — although we’re starting to get better at that.
So the question is: How do we address these limitations and gaps that are likely to erode public trust? And I think it’s important to keep public trust in these systems, because, if these systems are going to show up in health applications, in autonomous vehicles, etc., people need to understand and be trustful of these systems.
Now, how we get to that — I think there’s a lot more research and work to be done. And I think some of that is underway; I think we’re starting to make progress on that front. But also, I think, having the public keep up with the field and understand how these systems work — there’s a lot of education, a lot of involvement and participation in the processes, that is going to have to [happen].
This is one of the things we have to get right.
“We have to continue to build public trust in these systems and be quite open and transparent about what we know and what we don’t know.”
Fei-Fei Li and Mira Murati | AI’s Human Factor
The more human-like artificial intelligence becomes, the more we understand how our brains actually work. Through that discovery process, researchers are identifying ways to design artificial intelligence in ways that factor in the safety and morality of their potential impact. Dr. Fei-Fei Li, the co-director of Stanford’s Institute for Human-Centered Artificial Intelligence (HAI) and a professor of computer science, and Mira Murati, the CTO of OpenAI, joined us to unpack all of that. In an interview with Reid Hoffman during Greylock’s Intelligent Future event, they discussed the process by which technologists train sophisticated AI tools like GPT-3 and DALL-E with ethical considerations; and the need for comprehensive guardrails developed in collaboration between researchers, industry leaders, and policymakers. Dr. Fei-Fei Li speaks first. You can listen to their full conversation here.
Fei Fei Li
AI is not one thing. Designing AI systems are really stages of work decisions, and we believe that at every stage of this AI development we need to infuse the ethics and human-centered values into this.
Simplest way to put it, how do we define a problem? For example, is your goal to replace humans without consideration of all the social implications, or augment human capability? Before you write a single line of code, you already are thinking about human values. The data, where does it come from? How do you collect it? How do you ensure data integrity? How do you annotate it? There are a whole bunch of things, from fairness, to privacy, to just a whole bunch of issues and considerations. Then the algorithm itself, is it safe? Is it secure? Is it biased? And then the decision-making using the algorithm, the inference, the human. Does it assist the humans or inform the humans?
“Every stage of AI development needs human consideration.”
“Often we get asked, “Well, does this in some way dilute the human creation, the original human creation? And what happens in the future?” There is this almost instinctive human reaction to protect our own original creations. And I think that if we look back in history, it’s actually not so different from what happened in 16th and 17th century where there weren’t that many people that could afford paintings, and so things were quite binary, you were either Rembrandt or nothing, and there wasn’t so much of a nuance appreciation. It was either great painting or not.
And so I think as we get tools like DALL-E or GPT-3, maybe there’s going to be a more nuanced appreciation for this co-creation, and a different appreciation for the original human creations.
But you can say, “Okay, this is an elitist point of view. What about the broader impact?” and I think that’s actually not so different from the effects of globalization because it’s really an exchange of ideas, a cultural exchange. And of course, there are unwanted and undesired effects of globalization, but overall it does create more diversity and it does create more prosperity. But actually, if you look at it long term and the global effect, the global effect is one of diversification, one where we end up with more ideas in total, more prosperity, and we will continue to develop more information and create artistically, scientifically, and also in a social context.
When it comes to the field of Web3, the past couple of years were action-packed, to say the least. Greylock has been following the fast-changing sector and is primarily focused on the companies developing the infrastructure of this new generation of the internet. You can learn more about our web3 strategy and the companies we’ve invested in here.
Reid Hoffman | Vices and Virtues in Web3
In late 2021, Greylock general partner Reid Hoffman wrote an essay on his experience as a Web 2.0 entrepreneur and investor. In that essay, Hoffman described the ways the “wild idealism” of the era led to major advances that both positively and negatively impacted the world, and how the “seven deadly sins” of humanity form the basis of many technological pursuits. That prompted Bloomberg reporter Joshua Brustein to reach out for an interview, which in turn prompted Reid and his Blitzscaling co-author Chris Yeh to build on the discussion by applying this same framework to web3 investing. The result is this conversation.
You’re balancing between centralization and decentralization, because part of it is to say, “Well, shouldn’t we just all be a command economy and everything stems from one autocrat leader on down?”
Well, we found that that’s a very inefficient system because people don’t feel co-ownership, they don’t feel innovative driving the thing that they own or want. So we should be enabling that decentralization. Decentralization is part of what creates an effort at meritocracy and an effort at making more talent be able to have amazing results. And obviously, I think our talent as a society is to say every person can deploy their talents to their best available abilities and then get some benefit from it. It is, generally speaking, where we want to strive towards; where we want to be towards.
Whether or not the perfect utopian outcome is ever possible seems unlikely, but it does seem that we could get better and better. And that’s where some of the effort to how you balance centralization and decentralization comes in.
Christine Kim | The New Computing Paradigm.
Greylock investor Christine Kim focuses on a range of consumer technology and marketplaces, sees a future where blockchain technology is the underlying infrastructure (and driving force of innovation) across nearly every industry. In this podcast from early 2022, she discussed her outlook on the sector. You can listen to her entire conversation with Greylock head of editorial Heather Mack here.
Crypto is such a broad area, whether you look at more infrastructure, Layer 1, scalability, security, all the way to consumer applications, that’s a layer that I’m spending a lot of time in personally, DeFi, DAOs, gaming, collectibles, NFTs. Across the spectrum, there’s so many areas to look at.
And so if you think about all those verticals, let’s say you think about communication, you think about storage, social, commerce, gaming, someone that you’ve named and someone that I’ve named, there’s sort of a play at which there could be a crypto company in each of these. And when I say a crypto company in each of these verticals, it’s not that there’s going to be a token like Bitcoin and Ethereum to buy and trade on a speculative basis. But when you think about crypto as a new computational paradigm I should say, you can see how it could be the underlying infrastructure for companies and opportunities across this space.
But I think crypto is just like mobile, it’s just like cloud computing, or it’s just like even the early internet. So there’s all these metaphors when you think historically about all these waves of innovation. And I think today you would not be a venture capital investor and say “I’m an internet venture capitalist,” or “I’m a software venture capitalist,” or “I’m a mobile technology venture capitalist.” Just because those technologies are so broad, they really just kind of shape all of the industries that we’re excited about and want to invest in.
And so I would encourage people to think about blockchain in a very similar way. It’s a new computing paradigm and it’s going to bring about innovation in each of these categories.
Shopify’s Harley Finkelstein | Catalyzing Entrepreneurship
Shopify president Harley Finkelstein sat down with Greylock general partner Mike Duboe to discuss the company’s evolution along with the overall ecommerce landscape; offer advice to entrepreneurs navigating the current market conditions; and lay out his vision for the future. The company launched in 2011, at a time when there were few options for entrepreneurs to set up their online stores, sell and market products, and manage their operations. The company struck a chord both with retail entrepreneurs in need of better solutions and app developers eager to build them. Today, Shopify works with more than a million businesses that collectively represent some 10% of e-commerce in the United States, providing tools for companies to set up, sell, market, and manage their products. You can listen to the full interview here.
If I go back to the beginning and think about what is the core competency of a merchant early on, or as a brand and founder trying to get started, in my view, the art is around finding your initial kind of audience, your initial 10,00 fans, if you will.
As you think about removing a lot of the other competencies that a merchant would have had to need to build in-house over time, and replacing those or kind of supplementing them with Shopify and its partner ecosystem, how do you think about the role you play in that core and that initial discovery for those fans? Would you say that is still ultimately on the brand founder to figure out?
Yeah, I mean there’s some things we do to sort of help them get found. It’s funny we all sort of take this for granted now, but like out of the box for $29, the SEO that you get with Shopify is equivalent to what someone was paying millions of dollars for eight years ago, five years ago.
Even so, we try to make it really easy, but ultimately we don’t do manufacturing for our merchants. It’s up to them, making the products. That’s up to them. And we don’t give them customers. We just don’t manage them.
Now, if they want to be given customers, a much better version of that business model is a marketplace. They will give you those customers. I think this is what people miss, but the marketplace model is that they are not your customers. You are renting customers from that marketplace. They belong to them and they will rent it to you until they decide they don’t want to rent to you anymore. But you are not actually building any direct relationships. And so your ability to build a brand, build an audience is up to you.
What we’re trying to do is find all the ways we can make it easier, whether that’s through audiences, through SEO or even through things that are simple, like the admin. When you’re looking at your analytics in your reporting dashboard and it says you were getting really high quality traffic from Pinterest randomly, you should go and buy Pinterest ads. Or you are getting incredible [data] that shows your best customers are coming from this geography. You should go buy ads in this particular geography.
And so we tried it like rather than,“give them the fish”, we try to, “teach them how to fish so they can feed themselves for a lifetime.” And not everyone likes it. Some people want to be given the fish and that’s just not our model.
As software and data management systems have evolved, so too have the cybersecurity threats targeting them. How can companies, government agencies, and individuals keep their data secure when risk is at an all-time high? Cyber is an ongoing focal area for Greylock, and we’ve been fortunate to partner with many talented founders innovating in the sector.
Nicole Perlroth and Bipul Sinha | The Zero Trust Strategy
Greylock general partner Asheem Chandna, former New York Times cybersecurity reporter Nicole Perlroth, and Rubrik CEO and co-founder Bipul Sinha discuss the current world of cybersecurity, ransomware, and the need for everyone to adopt a “zero-trust” strategy to protect their data. You can listen to the full conversation here.
In my mind, ransomware is penetration testing the United States right now. They are exposing just how vulnerable we have been. And they are giving us visuals to this vast ocean of cyber threats that the three of us have been tracking for more than a decade.
And we’ve talked about this before, suddenly Americans are asking How are we this vulnerable and how do we protect ourselves? And they’re demanding that the government do something. And we’re talking about things like zero trust and an SBOMB – Software Bill of Materials – and demands are being made of software vendors in ways I’ve never seen before, particularly after the SolarWinds attack.
So, I think we are having a moment that’s more than just a passing news cycle. I think that we have an administration right now who has put top people in the job and sure, they face serious structural challenges in addressing these issues. But I think that we’re not just going to be continuing with the status quo of America as a country that is becoming one of the largest and ripest attack surfaces in the world.
I think, finally, people are understanding that there needs to be more accountability here, of corporations that we entrust our PII data to, vendors that we give great access to our networks and on and on down the chain so, I think we’re still in for a little bit of short-term pain, but I hope five years from now, we’re going to have seen ourselves turn a corner.
I think the perspective that the technological progress and continued digitization of our professional and private lives will continue to increase the surface area. And as with the increased surface area, as we are plugging in holes, the government will get a lot smarter and corporations will get a lot smarter, people will get a lot smarter, but the problem will not shrink.
In my mind, the problem is and will continue to be a significant problem, but it will shift from a soft underbelly to more of a difficult attack, but we’ll continue to see more and more attacks. And eventually it’ll all boil down to the cost of doing business. Just like when you swipe a credit card transaction there is a certain small percentage of fraud in credit card transactions, and the company has to go and make sure that they cover that cost and underwrite that risk.
Similarly, in all our digitization activities, there are some costs. Call it a “rent” that people have to pay for cyber security, and it’ll continue to be a significant problem. So I feel the future will continue to be a cat and mouse game, with good and bad fighting each other.
Cloudflare’s Michelle Zatlyn | Cyber Stewards
The vastness of the internet, as an entity, can be difficult to put into perspective. Cloudflare, however, has a clear sense of its scope, as it handles roughly 20-percent of internet traffic. To frame it with another stat: More than 70 billion cyber attacks are stopped by Cloudflare each day. Cloudflare Co-Founder, President, and COO Michelle Zatlyn joined us to discuss what it’s like to run a company that a massive constituent of users touch – often without them even knowing it. You can listen to her full interview with Greylock’s Holly Rose Faith here.
I think that we led our company a slightly different way, and we had some assumptions early on.
We thought it was important to have a face to the company. What I meant by that was: We were groups of people working on this. Because of what we were doing, we felt we sat in a very privileged place online, and that when it works, it provides a ton of value. Again, 80 billion cyber attacks were stopped every day because of the technology we built. It’s amazing, you can make things faster and safer. That’s all the good side.
The shadow side of that is: Are you like a big brother watching everything? That’s kind of sketchy. And so, early on, we thought it was really important to have a face to Cloudflare. So we showed up to things, we had public profiles. The point is: this is a service made by people for people, for companies, and we take responsibility, and we care. These are things that we cared about.
And then there were things that happened where: bad things would happen, sometimes there would be a security breach or whatnot. And you don’t have to talk about these things — in our space, the common approach was not to talk about it. We felt like to build trust, you need to be transparent. We believe it’s important.
And so we started to be really transparent about why we were building something, or, when something went wrong, what happened and what we were doing to fix it. We were very committed to being transparent, both internally with our team — we shared a ton of information, we still do to this day — but also externally.
The world has really changed in the last 11 years. Now so many more companies are more transparent. It was interesting how that was not the case, but we were trying to share why we made a decision, what we were going to do about it. That’s a big responsibility, but it was a choice. No one told us, I don’t even think it was conventional, but it was a choice that we made, and then you got to stick with it.
Cloud technology is a major focus area for Greylock. We’ve detailed our partnerships and investment theses extensively in our Castles in the Cloud project, which is an interactive data collection and analysis platform designed to map the ecosystem and identify areas of opportunity. You can find more about all of our cloud investing here.
HashiCorp’s Dave McJannet | The Multi-Cloud Paradigm
As we’ve noted in our analysis, cloud infrastructure company HashiCorp’s public market debut in late 2021 represented not only a milestone for the cloud sector overall, but the growing reality that functioning in today’s ecosystem requires a multi-cloud approach.CEO Dave McJannet joined Greylock general partner Jerry Chen to discuss the current cloud landscape, how the company continually innovates to keep up with the increasing complexity of the cloud ecosystem, and the new opportunities for startups. You can find the full interview here.
I go back to the thesis for business building, which, in my view, is very consistent. It’s about old world/new world transitions, architecturally, that create the opportunity.
So what was happening 10 years ago was the emergence of cloud as a target. And it was the realization, “You know what? The paradigms are just different.”
I would think about how profoundly different the paradigm of cloud is relative to the old world and then start looking at the existing markets in the old world and see how they are going to get reconstituted in the cloud. I think that’s actually the right word. These markets go from old world to new world, and don’t look the same. They’re just reconstituted in a slightly different form as the world goes cloud, like it’s just a different paradigm. Now you’ve got to give temporary access to a machine that may only be alive for a minute, but the problem still exists. So the old world/new world transition is right there for the taking.
Transportation and driving technology continues to be a closely watched sector in the tech industry, and 2022 was full of milestones across regulatory, technical, and market aspects.
Convoy’s Dan Lewis | Transporting Innovation
Dan Lewis of Convoy, which has developed a platform that puts drivers, shipping companies, and freight brokers on the grid, joined us to discuss the current shipping landscape and how his company upgraded the long-antiquated trucking industry. You can find the full interview here.
If you think about overall freight transportation, trucking accounts for about 80% of it in the United States, the dollar spent on transporting freight. The other 20% would be things like air freight, ocean, rail, and pipeline.
So trucking is the vast, vast majority, and it’s the number one job in the country. More people are truck drivers than any other type of job.
And that’s also because it’s so incredibly fragmented. So you have almost a million small trucking companies on one side. The average one has about three trucks. And on the other side of the marketplace, you have about 100,000 companies that ship truckloads of freight. And between the two, there are over 15,000 freight brokers. Some of those are independent brokers that are calling both sides to try to make the deal. Some of those are asset-based trucking companies that also have a brokerage on the side.
And effectively, the way the brokerage works is, they build relationships with trucking companies and truck drivers, and then they go to shippers.
That’s how the industry has worked, and it’s been pretty offline. It’s been done through phone calls, text messages, emails, and some online load boards, which is kind of like the Craigslist for finding a truck driver and truck drivers finding shippers, historically. That’s why it was really offline.
The other reason is that truck drivers didn’t have a platform to which anybody could connect to. There wasn’t one ubiquitous digital platform in all the trucks that was open for people to go build apps on or pull data from.
And until about 2014 or 2015, truck drivers didn’t have smartphones in their hands. That was the year too, it was 2014 when the Samsung Galaxy S III became the first Android phone that the phone companies, like AT&T, Verizon, Sprint, were giving away as part of your two-year upgrade, or it was less than 100 bucks. And so, that was the phone most people were getting. And all of a sudden, they had lower-cost iPhones, and all the phones became smartphones in 2015 that basically you could get with your upgrade. So that’s when all the truck drivers got smartphones like everybody else.
And that led to this completely different opportunity where, for the first time ever, all these drivers are now online and they have a single platform with location information, two-way, you can send and receive pictures, you can use an app, you can share all this data. And
“All of a sudden, you could take this offline, antiquated industry that hadn’t had an opportunity to do that online. And the unlock was this long tail of trucking companies and truck drivers getting on the grid basically, getting a smartphone with an open platform.”
That’s what honestly allowed this to happen. If that had happened 10 years before Convoy, I’m confident someone else would have built this. We were just there at the perfect time.
Zoox’s Aicha Evans | Moving People Forward
Zoox CEO Aicha Evans joined us to discuss how the “robotaxi” company has made safety permeate into every aspect of the company culture and operations; why they are building for dense urban environments; and her vision for the future of the “people moving business.” Beyond the technology, the company is notable for its extremely transparent work culture. You can listen to the full interview here.
[We have] a very transparent culture. Some would argue too transparent, by the way. But there’s one plan. Everybody knows it. If you work at Zoox, I’m not giving you any opportunity for it to be a secret. We are very much focusing on decisions and who needs to know. It’s a vertically integrated product. And so we’re very honest about that upfront. We build it into our culture.
I just had a discussion with some folks who are helping us with some safety stuff. And they said to me, “Well, for a company where safety is foundational, it’s kind of odd that you have a lot of groups doing safety.” And I’m like, “Yeah, by design.” I cannot be in a situation where there’s a group over there that everybody’s looking at and saying, “It’s your job to do safety.” No, even the software guy who’s coding, I want him to think overrun, underrun. Like, “What do I do if something goes wrong?” It has to be permeated in the culture.
Last but not least, also being very transparent about the fact that this is not a get-rich-quick scheme. This is the beginning of this [type of] transportation. So really transparent, really open, and really a big, big focus on collective learning, on decisions. And when we have a tough decision, not only do we give the why, but we also give trade-offs and alternatives considered. Because sometimes people need to hear that they were heard, basically. And then synchronizing. So sometimes some teams get mad because they can move faster. And I’m like, “Yeah, but that’s too fast for the rest of the company. So that’s going to create problems.” And you hope that people agree with that, that they accept it. And if they don’t, that’s okay, because it has to be a match for everybody else.
Talent is an ever-important focus area for startups. We’ve found that all content featuring discussions about interviewing, recruiting, and retaining top talent are consistently popular with our audience, and the following are among the top most-listened to, watched, or read interviews across all Greymatter platforms.
Workday’s Aneel Bhusri | Engineering Values
To kick off this section with some of our most popular discussions about interviewing, recruiting, and retaining top talent, we’re featuring our conversation with Workday CEO and co-founder Aneel Bhusri. Bhusri, who is also a former managing director at Greylock, is known for his laser focus on two things: product vision, and the ability to find and retain great people. He and his Workday day co-founder and co-ceo Dave Duffield actually interviewed the first 500 employees themselves, and they did so with the goal to find the people who embodied the values to guide Workday’s company culture. You can listen to his full interview here.
We weren’t interviewing those first 500 — and for me, it probably went on even longer past 500 — we weren’t interviewing them for their skills. We assumed the team would get it right if they were a great marketing person or development person or salesperson. We were very focused on: Was this person a good fit from a values perspective?
Because we knew if we got the first 500 right from a values-fit perspective, they were committed to the long run, they believed in our core values, they were not the shiny-new-penny people that were jumping from job to job. If we could sort that out up front, in a we-versus-I, that 500 would then be empowered to hire the next 5,000.
We don’t run this business for shareholders alone; I very much believe in stakeholder theory. I didn’t call it that back then. I only realized that that’s what we were doing recently after Marc Benioff helped me understand what we were doing is stakeholder theory.
But you take care of your employees, you take care of your customers, you take care of the community, you take care of your business partners. You make investments in helping society be a better place, whether it’s in diversity and belonging, whether it’s in sustainability. And I think it’s not just the right thing to do, but it’s a massive competitive advantage when you’re hiring.
This new generation of people coming out of school, they want to be tied to a company that has a purpose beyond a high share price.
Glen Evans and Evan Reiser | Building Your Best Team
Greylock Talent Partner Glen Evans and Abnormal Security CEO and co-founder Evan Reiser shared strategies and insights from building startup teams at a time when, no matter the economic conditions, everyone is always fighting over the same limited supply of world-class talent. You can listen to the full conversation here.
One of the things I’ve learned pretty early in my career is if you have a clearly defined process early, it can take you to great places from a hiring standpoint.
So for example, I know Facebook in the very early days had very clearly defined interviewer roles, questions to ask, what good answers are, what poor answers are, and they kept it very organized and structured. And what that led to was in the early days of creating a kind of a viral culture of recruiting – It’s everyone’s job, it was organized, it created a good experience for candidates.
Over time as you add more people, that’s harder to maintain. So having documentation, having interview training, all of those things helped it scale to a place where they kept the bar very high and brought in a lot of great talent.
That’s one of the key things I would recommend to any company starting out early. And I know Evan and Sanjay and the Abnormal team did that very well in the beginning, so maybe you can touch on that, Evan.
Yeah. I feel like over the course of a startup journey, there’s some things that change and some things that stay the same.
What stays the same is you always need to be really actively looking for a good mutual fit. It’s not good enough for a candidate to be good for you. You, the company, also have to be great for the candidate for it to work. You’re always going to have to have real high clarity in what the job is to help make sure you’re doing thoughtful assessments, and also thoughtful matching of that mutual fit.
Then third, you really have to differentiate the company. Why is this really a better place to work than other places?
So I think those stay the same in the startup journey. I think early on, you can make a lot of recruiting progress. You’re trying to hire one or two people a quarter by using just a lot of time, energy, passion, to kind of recruit people to that early stage startup. But then when you start growing to 100, 200, 300 people, and now you need to start hiring 50, 60 people a quarter, it’s no longer good enough to just work super hard and be passionate. If you think about how you build a recruiting engine across the company, that requires everyone to be aligned on the importance of recruiting, and requires the company to invest in compensation, in actually making the company a great place to work – whether it’s the culture, or the systems, or the programs.
“It’s no longer good enough to just work super hard and be passionate.”
And as Glen mentioned, you need to start formalizing that recruiting process so you can provide an A+ candidate experience, but also make sure that you’re fully assessing candidates to make sure that they are a good fit for the company as well.
Yeah. And I would actually just add one other thing: It’s critical that you don’t settle for a hire. The process will help define the bar, but a mis-hire can set a company, a team back for a long time. It’s very painful to unwind a bad hire. And so I’d recommend to anyone to really keep that standard high and do not settle for talent.
That’s totally right. And sometimes, it’s very easy to imagine what the cost is of not hiring someone, but it’s hard to imagine what is the cost of really finding someone that’s not a great fit for the company. And I’ve personally made this mistake a couple times. And in a lot of the cases, the candidates were really qualified for the work we had to do, but we weren’t actually qualified for what they really wanted to get out of the job; what they aspired to do.
So it’s extremely costly to have the wrong person in the role versus just not having someone in the role at all.
Holly Rose Faith | Executive Reference Checklist
Holly Rose Faith, who works with Greylock startups to find, recruit, and place executive team members, outlines smart strategies to deploy when checking references. From having a plan of what you are looking to validate at the outset, to the specific questions depending on the role or stage of company, all hiring managers should go into referencing with a reliable, repeatable, formal system in place. You can listen to this full conversation here.
Holly Rose Faith
You want to zero in on the most important areas: the behavioral competencies, the technical skills and knowledge, the personal characteristics, the leadership ability, advice to new management, strengths, and areas of improvement.
As you ask these kind of open-ended questions on these important areas, you’re going to want to ask for examples to support the comments that they made – both positive or negative. So if you notice, all of these types of questions are tailored to, one, find the information, but two, they’re all real-life scenarios that if you hire an executive on your team, you’re going to be experiencing. So it’s better to find out some of this stuff in advance.
When it comes to volatile market conditions and rapidly-changing economic, social, and geopolitical environments, 2022 was action-packed, to say the least. Throughout it all, we strive to provide guidance based on the collective knowledge of Greylock’s network of investors, advisors, specialists, and entrepreneurs.
Reid Hoffman | Bear Market Blitzscaling
Reid Hoffman, who has offered advice on crisis management and tactics for navigating economic downturns many times on Greymatter, offered up specific guidance for the most current era. In this discussion with his Blitzscaling co-author Chris Yeh, Hoffman contends that now is still a good time to start and scale companies, albeit with many considerations. Here are some high-growth strategies for high risk times. You can find the entire conversation here.
Now, it feels like we’re in a bear market right now. Certainly, there’s a lot less money being invested by the venture capital industry. Does that mean that this is a good time to start a great company? Is that the message that you want to send to entrepreneurs?
One hundred percent. Now, it doesn’t mean that it isn’t hard, much harder to raise capital. When you’re a first-time entrepreneur and don’t have a lot of background, don’t have a lot of network, you may not be able to start a company in this kind of time. You may need a more open, more bull capital market for someone to be able to take a risk on you, because capital will be far more constrained, far less generally available.
On the other hand, if you can start a business and you can raise the capital and you can get going, it’s a way to get a lot of differentiation between you and the rest of the possible competitors. This is actually one of the funny things that I see in talent flows. A lot of talent flows are going, “Oh, I should go back to safe companies like Microsoft and Google and everything else and do that.” It’s like, well look, that you can do that, totally fine, but it’s also a very good time to join the startups that will get through this because they’ll actually be worth a lot more because they will have succeeded past competition. Because joining companies is another form of investing and it’s a good time to invest in the ones that actually, in fact, can get through the down times because their value on the other side will be highly magnified.
It’s a similar reason for potentially starting a company. Now, you have to start a company that’s a higher beta to a higher alpha kind of outcome where you say, well, if you can pull it off, if you can get financing, if you can get it started, now’s a really good time. It’s harder to pull off, and so therefore you might also decide to defer because making intelligent ABZ decisions about what your efforts to refer to the start of view is a key thing to do.
Now, speaking of investing, we’ve discussed earlier how there’s less venture investing going on than before. I also see a lot of venture capitalists out there telling the entrepreneurs, “Hey listen, I don’t know if you’re going to be able to raise any more money, you get five years of runway, you get the profitability however you can.” At the same time, I’m hearing from you that this is a great time to start a company. This is the period of time exactly when great companies get started. What’s the deal there? Should people be trying to just get five years of runway and is it right for venture capitalists to be so conservative right now? How should we all be thinking about this?
Well, look, it’s again, there’s not one simple slogan because it depends on the circumstances that you’re in. That’s part of the reason why and what you think you can achieve, what your level of risk appetite is, what your ability to navigate risk, that’s the gesture of the ABZ planning because it’s a risk planning and mitigation framework to navigate risk intelligently. It depends.
Example: if you said to me as an entrepreneur when I started working on LinkedIn in 2002, (which was still deep in the dot com winter and I was kind of working my way through that), that was a good time to do it. I was able to do it because of the success of PayPal. Similarly, I would do that as an investor. I’m active because I actually think the right projects done now will have a higher ability to succeed, and so that’s also positive in doing this.
On the other hand, there’ll be lots of startups that fail or fail to get off the ground. That’s not saying, “Oh no, no, it’s going to be great times all around.” That’s part of making good decisions, having the intelligent risk frameworks applied, navigating and pivoting and changing based on the things you’re finding, and getting really good advice. And having that advice be on [questions of] why would this fail? Why would this not work? Because it’s not just about having an irrational belief in the success of what you’re doing, but approaching it in a risk-intelligent and a strategy-intelligent way. Those are all the concepts applied – which in some cases will be really spectacular – but obviously, you have to navigate more landmines and speed bumps and death traps and potholes as part of doing it, because that’s part of what a bear market means.”
Thank you for listening, watching, and reading Greymatter content in 2022. If you aren’t already a subscriber to Greymatter, you can sign up wherever you get your podcasts. And if you like what you hear on Greymatter, please leave us a five star review on your favorite podcast platform, and share any feedback you may have.