Prolific entrepreneur and investor, Arjun Sethi on overcoming the challenges of scale

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In this episode, Elias Rubel is joined by Arjun Sethi, co-founder at Tribe. Tribe Capital is a venture capital firm launched by a trio of former Social Capital. Some of their previous select investments include Digital Currency Group, Intercom, Slack, Relativity, Carta, Cover, Invenia, Front, Cloud Kitchens and many more. He is an entrepreneur who learns and adapts quickly. In this episode he shares lessons learned along the way.

Episode Outline

[04:39] Arjun’s background

[07:16] How grew up here in the Valley and a lot of my family was coming from all over the world

[10:13] How to judge whether it is math question vs communications question

[12:04] The journey into the SaaS business

[16:34] The process of seizing fabulous opportunity right now

[16:35] You only need to have a hundred customers and then you can scale something

[19:22] The challenge of scaling your first company

[27:04] Starting a company is hard. Finding the customers to pay you as hard

[30:18] His thoughts on the evolution of tech

Arjun's Inspirations:

Ryan Breslow

Marc Andreessen

Peter Thiel

Connect with Arjun



Elias Rubel (00:31):

Today I'm really thrilled to invite someone to the show who has been pretty instrumental in my own entrepreneurial career. Arjun Sethi. He, if I were to rattle off everything that he's done in in his entrepreneurial journey, we would be here for like 10 minutes listening to the intro, but some highlights a message me. So the Yahoo, a partner at social capital and now cofounder of tribe capital. If you look into his angel investing background, the list goes all the way back to 2007 and basically every notable company is on that list. So Arjun super thrilled to have you on the show. Thanks for taking the time. Yeah. Thanks for having me on Elena. I appreciate the time. So I'd love to start with, with your experience as a founder, you've taken multiple companies through this cycle of post product market fit to 10 million error and beyond. You're no stranger to that process though. You've tackle different kind of industries almost each time. So I'd love to just go back to the very beginning and hear, you know, the very first time that you ran up against this challenge of scaling your first company, post-market post product market fit. And kind of what were the biggest challenges upfront and how did you tackle those?

Arjun Sethi (01:56):

Yeah, so the best way to think about any company or product you're building and I guess you know, specifically to what we're discussing here today is, you know, our software companies is know what, who are the customers and, and what are you trying to solve. And I think for most of the companies that people have been building today, if we take a step back you know, over the last 30 years, at least for software products, you know, people were basically making in some ways generalized databases and then some sort of generalized application on top of it. And then over time what you had was these generalized applications and over time vertical applications that were being built on top of that. And then if you cycle that through as that people were starting to build verticalized databases for those Vertafore verticalized applications, and then and then building on top of that.

Arjun Sethi (02:52):

And so the, these, these types of cycles really matter over the last 30 years because the types of companies that have been been built either core infrastructure or applications on top of that infrastructure and then workflow application software on top of those applications, I think is really important to kind of understand where you fit in and that ecosystem and who are your customers. So, you know, at least for the purposes of this conversation, you know, I can jump straight into you know, a company that we had started. It wasn't my first company. It was probably the 10th or 11th sort of try, but it was a company called low laps. It was called laughing out loud applications. And exactly kind of what it sounds like is we hit, started building what I want to say. Applications that were viral in nature, short term bursts of dopamine hits, if you want to call it that.

Arjun Sethi (03:51):

Now that the lived in survived on the Facebook application, no, sorry, the Facebook platform. And they were very viable. They grew very quickly and and, and in order for us to grow them and effectively measure how fast we were growing these products we had to build our own data and analytics infrastructure from the ground up. There wasn't really any cloud services or application services and analytics on top of it. You know, were, we didn't have AWS we didn't, we didn't have like, you know, a Redshift databases to be able to do like these really fancy queries. We kind of had to start from ground up and at the time we were actually using a company called software, which subsequently got acquired by IBM later. But the, the, the hard part of of that time was that we were building products for consumers and these consumers, if you remember, or people remember where they, we were a billion consumer gaming products, which has even has a shorter half life in some cases where you are just testing and iterating and building as quickly as possible to just try to find out what your customers want, what they don't want.

Arjun Sethi (05:12):

And if you find any glimpse of up into the right metrics, you're just double down. And that could have been on a daily basis or a weekly basis. You would just try everything. And then over time. And, and the reason why that we did that was because the app, the platforms that we were developing on top of were so viral, know mobile was viral, Facebook was viral, MySpace was viral. Open, social was viral in some cases. And so anything you built would, people would start using but you need to know how fast they retained. I think I remember at some point on the Facebook platform, Facebook had made an announcement, which was fairly embarrassing for them, where they said, Hey, we have a million application developers on our platform. Guess 999,000 of those application developers was us, our platform allowed.

Arjun Sethi (06:04):

And any person that didn't have the ability to code just to build a quick application. And so these applications were gifts and quizzes. Mmm. You know, if you don't, you know, if you might remember you know, what sex in the city character are you, these are, these are, these are apps that we we didn't build, but our users built on our behalf and deployed it on our platform. And then we would distribute it back onto Facebook and then we would grow. And then over time, no, what we had to do was we had to build our own workflow, our own software, our own tools of communication or own analytics in order to deploy these things fast. And remember that means we had to vertically integrate all these pieces. You know, SAS wasn't really starting it. I mean this was the early innings of Mongo DB hadn't even started yet.

Arjun Sethi (06:54):

We were to some of the first customers of it. And it broke all the time. Especially I think at some point we might've been the biggest customer because you know, we had 300 million monthly active uniques in our platform at our peak. Correct. We would use my worries and my ongoing, my SQL, you know, old Oracle database. It's just like everything possible to get stuff up and running. And I remember at this time you couldn't really get an application up and running very quickly because you had to spend a certain amount of time architecting your database schema, which we don't think about today. But at that time, you know, 10 plus years ago you did a, so there was a lot of, a lot of ops that you just didn't think through. So, so that, so that was a lot of the experience at that time.

Arjun Sethi (07:41):

And what was hard was, you know, how do you, how do you expand and contract in an area where you are building games, you're trying to build it like a software product. But you have people that you have to expand and contract and you have to build a workflow software for artists. You have to build a workflow software for game designers and game developers. It was like the first time I got like jumped into things that were more manual and labor and processes where we had to kind of just build things and make it up as we went along. And then over time, as our industry got bigger, as Zynga got bigger, you saw all these kind of niche freemium SAS companies that popped up just for us. Of course there were other companies that were doing it for other parts of the market, but even for our industry, you saw data and analytics companies pop up, right?

Arjun Sethi (08:31):

Like we were their primary customers. Cloud services used to go to gaming companies first. I don't think people realize it, but no, I think at some point between us and Zynga and a couple of other customers, we might've been like, all of AWS is a and class versus capacity, you know, 80%. And they hated it because they couldn't service new customers. We just, we just have so much demand. So a lot of was just going through these nitty-gritty things that you know, we forget about today because capacity and bandwidth and storage and retrievals easier. But at that time it was much harder. And so, yeah, we, I mean, we grew from zero to a hundred million in revenue, very quickly, zero to a hundred million monthly active uniques. Very quickly. You know, again, peak was about 300 million.

Arjun Sethi (09:18):

And then we went from gifts and quizzes, applications to games to publishing games. We started having micro and payment systems within our ecosystem because we weren't just on Facebook, we were on mobile and on mobile. You know, there, there wasn't Apple pay that wasn't you know, you couldn't input a credit card. We had to do it by ourself. And so you'd integrate with so many different providers. Some of them were offers, some of them are advertising, some of them were exchanges to move customers from place to place that you can now you, you can give them some sort of dual currency situations that were there. All of these things that we were pioneering at that time that, in my opinion, kind of led way to a whole host of new types of companies on the enterprise side.

Arjun Sethi (10:02):

Yeah. You know, companies like Slack all the way to data and analytics companies like amplitude, Kissmetrics at some point in the past. Mixed panel. We were really early on leveraging and you're letting, utilizing these technologies but also building them. We ended up you know, some of my core team members ended up building some of these companies when they left. The social gaming ecosystem. So, you know, long story short, we, well we scaled very quickly. But the way I went through a lot of hard times because we were in an environment that was non predictable is very similar to the movie industry, very hits driven. And we we had to expand and contract. I think at our peak we had almost a thousand people in our org pre, sorry post acquisition with a company called Nexon.

Arjun Sethi (10:56):

And then I had to, you know, fire 700 people, myself and my executive team and we hired a couple of hundred more and then we contracted again. So it's very, very different, a stressful environment. But we were building software and we were at the I think we were at the forefront of pushing the edge in that ecosystem at least in the gaming and mobile ecosystem before I moved on into building you know, more traditional software consumer products and traditional enterprise products where we either we built it ourselves or we invest in,

Elias Rubel (11:28):

It's like you built the, a, not to be cute about it, but you built the the Buzzfeed quiz like 10 years before Buzzfeed built the Buzzfeed quiz. What type of blank are you? 

Arjun Sethi (11:44):

Yeah, it's really fun. It's really funny you say that because as much as I'd like to claim that we did that before anyone, before we were on the Facebook platform, people were building these quizzes on the, on the web and you know, and, and I think people forget that they have a very short term memory, but a lot of products and a lot of ideas that we have now, even in the, no, in the, in the SAS space, they have been thought through before and they've been pitched and they've been talked about. But it's timing, right? The example I give you is that, you know, today it's really easy to say that you need you know, a vertical application databases or databases that are flexible enough for you to be able to do a quick iteration testing and releases of products. You know, but 15 years ago that would have been considered you know, contrarian or, or very different in contrast to how people were developing.

Arjun Sethi (12:36):

And then if you go back far enough and so, so timing mattered, right? Which is, if you, if you if you made this pitch 15 years ago, people would think you're crazy. And, and, and there's been many, many iterations of the same types of ideas. So, and, and, and I, and Buzzfeed will happen again and Buzzfeed business. And I remember when they were coming up and, and I've seen this on, you know, the mobile platforms is the same ideas and the same types of applications. Every once in a while you just see this order out through SMS. People are sending quizzes. It keeps coming back. And I think it's because it's natural human behavior of these types of products. People like if you go back even far enough, it used to be in newspapers. It used to be in, you know, paparazzi style magazines that were out there where, you know, people would ask me what type of character are you and your, your attributes and characteristics of celebrities.

Elias Rubel (13:30):

So that's not going to change. Gaming isn't really changed. The ideas and concepts are the same. It's just that the medium, the distribution and the quality has changed.

Elias Rubel (13:39):

So before we move on and talk about your careers and investor and some of those companies that you've helped grow as an investor, I'm curious, you grew up with a family of entrepreneurs, right?

Arjun Sethi (13:54):

Yeah, my, my dad had started a couple of companies quite successful. My mom had started and worked on as an executive, a couple startup companies. And it was also quite successful and they had a ton of their failures and I lived through it. I watched them build these companies from our garage. And, and it was quite, yeah, it's quite an entertaining, but also quite traumatic because I hadn't, I hadn't ever seen anything like that before. And then my cousins were in the ecosystem too, kind of across the board because I grew up here in the Valley and a lot of my family was coming from all over the world. India, New York, Canada, Texas. And people that I never knew my whole life with similar last names and backgrounds. And then they were either living with us or they were going to school just to come to the tech ecosystem and either be a part of it or start something.

Elias Rubel (14:47):

And then you, you ended up enlisting in the army and going into the department of defense. Right.

Arjun Sethi (14:55):

So from 99 to 00 I was actually kicked out of high school, so it's not something I talk about very often. But you know, I, my friend and I had joined the military army and w and it was through a process where you call it the buddy buddy program where you can go through a basic and your MOS the designation of what you might do in the military together. And so I had done that, come through basics about 14 weeks and and then there's an additional couple of weeks. And so what really happened was that I was you know, I guess, you know, above average in terms of testing you can call it sort of modern day IQ test. And so I just kept testing out of what they put in front of me and, and as did my friend and colleague. And so what that really allows you to do is get more optionality across different departments of the military, if you want to call it that within the United States. And and that's what kind of really led me into kind of maneuvering my way. And liaising Lee, liaising with the military mostly the army. But within the department of defense, between 99 Oh three, I get this is all pre Homeland security things kinda changed post 2001. But that was kind of my experience during that time.

Elias Rubel (16:09):

Sure. So I wonder like those are both pretty intense things like as a child to grow up with a family of entrepreneurs as you described, and then to go into the army and have that experience. How do you think that those two things influenced you today in whether it's the companies that you started, how you operate or the investments that you make and how you interact with those companies?

Arjun Sethi (16:33):

You know, the, I think from the military side, a lot of people don't really give a lot of credit to what's happened over the last 50 years in the history in the United States, right. Where you had hooks like Bush in post-war, I guess during world war II and post world war II era where they focused on a lot of R and D and development and testing iteration. And Shaleeya was okay in the advancement of understanding what could really be applied to the regular core of the military. Right. So for instance, radar what was advent during world war II, we probably would not have won the war without that. And so there's a lot of, you know, I won't go into history, but there's a lot of books about what had happened there and how did it get incorporated into, you know, our, our defense budgets over time, you know plus world war two as well.

Arjun Sethi (17:30):

And, and how much investments we made into this which ended up leading into, you know, the the modern day internet and kind of the beginnings of where the internet had started and where we are today. Like, it was all built off of some of what you call, if you want to call it the world of bits versus world of atoms. You know, as sort of Peter too, what kind of defines that world. And, and, and I think what you learn is you know, the military is not too dissimilar to a corporate structure. You know, with politics and and just the way in which things are run because this is how they have unfor, you know a tens of hundreds of years in some cases around a certain structure and order. And then they have different departments, what I said, they take what they call moonshots, where they are investing into the future of what might be incorporated into the overall overall chain station.

Arjun Sethi (18:26):

And so, you know, I think a lot of, some of the best companies, you know, [inaudible] parts of these concepts and iterated on it and they created their own functional groups and departments, if you want to call it that. And they mimic a lot of I would say military style organizations in some cases, you know, like the East India, British East India company was, you know, I would say part, partly militaristic as well as a company given that there were subsidized and backed by the, the British government. So, so I wouldn't say there's any one or two lessons from there except for just, you know, if you, if you look at any company around product market team and distribution you know, what are the things that you do that are, you know, keeping the trains running on time and what are the things you do for scale, if you want to call it zero to one from one to five to five to 10 in terms of a scale of a business yet zero to one is really about testing and iteration, trying to figure out how to make something work for your customer.

Arjun Sethi (19:24):

And I wanted to, five is like, I think I've found something, let's see how far I can take it. Then once you've taken it to a certain stage and it's about scale and just, you know, a repetitive nature. And, and if you look at venture capital, it's really, it's really sophisticated that way. You know, people call it pre-seed market and they call it the seed market. And then if you just, if you just listen to those words, yeah. Pre-Seed and seed from a gardening and farming perspective is just means like you're trying to water something. Water means capital a to see how far it may grow and there's a certain risk associations and, and different ways of underwriting that risk at each stage. And, and, and a lot of my experience luckily has been on all stages. But more so well when we finally get from zero to one or going from one to five to five to 10 has been, I would say probably more of my time spent over the last, you know, give, give or take seven to 10 years.

Arjun Sethi (20:18):

At organizations like elapse before we sold it. The next on messaging me before we sold it to Yahoo. And then scaling Yahoo was a portfolio of products as well as starting new ones. And how to incorporate that into into Yahoo as an organization as a whole. Like how do you do experimentation and innovate while maintaining your core engagement and eyeball base, which leads us into revenue and how do you, and then how do get more revenue over time with that base. And then how do you scale something new up and how do you do that at a speed at which, you know, most companies are not used to because you have scale and distribution size, et cetera.

Elias Rubel (20:56):

Sure. So I know you could tell a million stories about the companies you've invested in, but maybe there are one or two where even recent investments perhaps where, where they were focused on that, call it, let's call it the five to 10 sprint and they, they've done either an exceptional job of it and you could go into why you think that is and how, what, what separates them from other companies who haven't done quite as exceptional in that, in that discipline or even one that maybe struggled initially but then figured something out or a handful of things out and just really unlocked that next level of growth.

Arjun Sethi (21:33):

Yeah. You know, there are, there, there are companies where people say in 2020 hindsight that they got there through X, Y, and Z methods and this is why they were successful. And I always get a little annoyed with those because no like history tends to get rewritten. And so as a tribe, as a firm, you know, we use this term a lot internally is that we look to recognize and amplify product market fit. And we have a quantitative framework to recognize chronic market fit. It's called the eight ball and called the quantitative approach to product market fit. And we utilize all of these frameworks to find N of one style opportunities and have one being a company that has category defining a monopolistic in nature and is not one of in companies. And what I mean by one of our companies is not like, you know, a company that has, you know, five, 10, 15, 20 competitors and you know, for a small amount of seed capital or everyone can kind of do the same thing all on social gaming, which is where I came from, which is I call a one of an market, not an in a one market or you have a ton of competitors and you're competing and it becomes harder and harder over time.

Arjun Sethi (22:55):

Cat goes up, et cetera. So, so the, so the two companies obviously that were much more well known for recently are companies like Slack and Carta where we invested since the early stages of the company in slacks case to series a post pivot from a gaming company and then for Carta the series C but you know, more like the, when the company went from I would actually make the argument one to five and now there is a five to 10 stage because they had changed their pricing, change their product, changed their solutions and it was kind of a restart in the way in which they think. And so we consider ourselves like the early anchors of that of that change in inflection point. Yeah. You know, I, I like went back to Slack because it helps inform where we come from and what our backgrounds are.

Arjun Sethi (23:46):

So, you know, my partners and myself come from social gaming, come from Facebook. We've come from mobile. And as I mentioned, the, the, the world over the last 10 to 15 years has been moving into cloud services. More data and analytics. Storage has gotten cheaper, retrieval of that sort has gotten cheaper and analysis of that data that is being stored has gotten faster, cheaper, better. And so where do you, where do you utilize your data science capabilities on these datasets that are so large? And how do you collect that data and how do you do it in a way great, become smarter and smarter. Obviously we've seen that in companies like Facebook, Google, Uber Slack, et cetera. You know, zoom and now you're seeing it in the enterprise software space and oppressing infrastructure space where they are thinking about building their companies, very akin in similar to consumer products and companies over the last 10 years.

Arjun Sethi (24:48):

Right. and, and I think that's a major shift and change in mentality and when you are, and when you are, are, are, are, are doing that, then what are the types of patterns you can start gleaning from it. Whereas you weren't before. So it's, so, to your question you know, what are the types of companies we like Slack and Carta for this instance because these are some of the companies in these verticals that are changing the way you think about verticalized software and software for specific use cases. I always go back to generalize database. What does that Oracle generalized applications on top of Oracle, what were those, you know, HR systems, financial services. In some cases Oracle built out themselves, but then you had other companies start work. Workday is a generalized application based off of a generalized database.

Elias Rubel (25:37):

And then Viva is a vertically integrated application on top of a vertical application like, like Salesforce. And, and I think people don't really get how that works. And, and why these things in the software ecosystem? Mmm, across healthcare, education, finance you know, food act tech, the reason we talk about these things and saying, Hey, software's going to proliferate or software is going to eat the world is because this was traditionally done with pen and paper. Or if they did move into any advanced state over the last 20 years and moved over to XL or, or a version of Excel online with rows and columns and they thought of themselves as, as tech companies, as it evolved. And most people as investors, you know, wall street, if you want to call it that as well, didn't think of these companies as tech, but now they are, all of these companies are spending a, an inordinate amount on it in inordinate amount of services to help support that it.

Arjun Sethi (26:36):

And that's like almost every company. And so I think like a Slack and Carta Carta being in the financial services, Slack being on the workflow communication, you know, akin to email are some of the first early innings of companies that we've seen here. Like zoom is not a new concept either. And they now you had video conferencing solutions, so Cisco and a couple other folks before as well. But it was always thought of differently. It was always nice to have solutions package versus a core business. And now that it becomes a part of our core workflow and the reason it becomes a part of our core workflows because the size and scale of all of these other workflow products leveraging software has become larger and larger essentially to be able to increase frequency of transactions and then and, and reduce the friction of those same transactions.

Arjun Sethi (27:26):

So, so for Slack, because of our background and Facebook, we just measured quantitatively product market fit. We saw that was working very well. I again, I think this is really important. We weren't, we didn't, you know, look Stuart in the eye and said, this is a great entrepreneur and we want to back them. We looked, we looked at the company and we saw core metrics that were really working on engagement retention. Remember, the company didn't have any revenue at this time. They had credits that they were using in order to get customers into the ecosystem. Maybe, maybe tens to hundreds at the time of company logos was engagement just starting. And, and this company at that stage was growing at 20 to 30%. On a, on a daily, on a daily basis, they ever day, you know, and, and starting to get into large numbers on a week to a week to week basis.

Arjun Sethi (28:16):

That's very different than what you see today. And then what we were able to do is also quantify the network effect between internal communications and external communications within companies. Again, akin to email, leveraging these frameworks of where we've been before in the software space. And and then for Carta, same thing, zero to one, a good engagement between employees and engagement between the the the back office and the management team. And then stakeholders like investors all on the same platform. You know if you take revenue out outside for a second, which is like you have the software, again, vertical in this case for Carta, a generalized database and then eventually a verticalized application with the verticalized database, specifically around equity and shares. And so then what do you build on top of that? And then they started building software and products for four on nine, eight cap table management.

Arjun Sethi (29:11):

Eventually management for fund administration getting into banking and financial services and then eventually into secondary transactions auctions like w what, what I, I don't think people kind of comprehend about companies like that and like Slack and Carta and what's going to happen in the future and energy and finance and real estate and healthcare is that you're going to see big, big companies like this emerge. And even small companies that you previously thought as niche are, you know, Oh, there they are. Billion, 5 billion, $10 billion opportunities. But you know, 10 years ago you might've thought of them as 200 to five minutes. There are opportunities, it's just much larger today because you can go worldwide, you can access a larger set of customers. They are used to purchasing now in this type of pattern. And then also use to finding services that buying this pen.

Elias Rubel (30:00):

And I think what most people don't realize is that it's really hard to find the timing of the types of companies that will work. And it's really hard to figure out a regulatory-wise where you can build and then and then the businesses that are unregulated, which is mostly where you see most of the competitive markets where the opportunity lies, right? Like you yourself have been there and we have been there, been there as well. Is, is, is what really happens and what do you have to go through in order to build these companies. And I think the big opportunities, in my opinion, for the folks that are working really hard and in these industries are the ones that are actually regulated as they become solely deregulated over time. The timing is really important of which ones have become less and less regulated so that you can start building some of these workflows for, you know, places like healthcare and education.

Elias Rubel (30:50):

And you've seen some early innings there because, you know, people talk about the FinTech SAS wave over the last seven years, again, or early innings of what we think it might be over the next 20, 25 years. Sure. One of the things I really admire about Urogyn is the way that you can look at what I think for most of us seems like a muddy. Like it's just so many different elements landscape out there and how much has changing going on and you're just able to see it so clearly and make it more quantifiable. It's always, it's always a pleasure to chat with you about this stuff and you make it sound so, so calm and straight forward, even though I know it is not that way. So yeah, it's I mean it's, I think what's important to note is look, directionally this is the way the world is going, right?

Arjun Sethi (31:41):

People talk about programmable money. People talk about all these industries, those, these are all I'd say, you know, sub subset economies if you want to call it that, where you spend your time and it's hard to be clear. Starting a company is hard. Finding the customers to pay you is hard. Finding customers to engage with you is really hard. And anyone who goes from zero to one, forget even venture scale. Anyone who gets that, like that's commendable. Just to be able to create even some sort of cash flow or cash management of growth or like getting from zero to one is hard. And, and, and that by definition is growth. And so what you really need to ask after that is, okay, well, can I go from now Paul Graham says, you need, you only need to have a hundred customers and then you can scale something.

Arjun Sethi (32:24):

Well, that is true to a certain extent. Do you want to get a hundred customers that love you? But you want to know if you can find the next a hundred thousand, I can do the same thing, but you've got to start somewhere. And I think the what, what, you know, what a lot of entrepreneurs and a lot of investors to study here in the Valley over time is find that first niche, find something that's just starting to work and then see how far and possible it is to scale it. And, and in some cases you don't need to do that. And that's okay too. You know, there there's been the boost chat movement of let's just start the company on your own and get your customers and have them pay for a cycle and cycle your cash management to continue to invest in growth.

Arjun Sethi (33:03):

And those models work too. They're just slower. And that's the whole point is they're slower. They could be more sustainable than may not be more sustainable. It depends, you know, how you didn't want him to find small to medium business. But the whole goal is now that software is proliferating everywhere, small to medium, mid market enterprise customers to the customer. And, and there's no differentiation now on what direct to consumer means. Right? Like if you were selling, like Dropbox was selling to a small to medium business or they're selling to consumer, but if they're using it for their personal and professional life, what's the, what's the demarcation? There's not a lot. And so there's a lot of things where you see that too, right? Where now I, I've invested in a couple of restaurants here locally. There are most of my friends, it's not something that I do professionally.

Arjun Sethi (33:50):

And they use Slack internally to communicate, but then they also use Slack and WhatsApp and telegram to communicate with their family. And then with some parts of their staff, they use telegram to communicate. Everyone's using different software pieces to get their businesses rolling. And so the question you have to ask is, at different stages of these businesses, what are the types of software that you build or vertically integrated workflows that you build to help augment these types of businesses? And I always go back to the, the core pieces that I mentioned the word generalized databases, generalized applications versus verticalized applications and verticalized databases, how they all interrelate together and, and where do you sit on that stack and what are you building and how large can that become? And sometimes kind of quantifying things into just very simple areas makes a big difference for how you spend your time and, and where you put your investment in dollars investment in time and an investment in human capital. Sure.

Elias Rubel (34:49):

So as we wind this thing down, this has been incredibly insightful and I'm sure our listeners are are going to really be able to take the way that you think about the world and, and find new ways to leverage that with the work that they're doing with their businesses or the companies that are starting. I'm curious, who has been influential in your life, whether mentors or even colleagues or peers who you think are just doing fantastic work out there in industry?

Elias Rubel (35:18):

No, I, I, I've always taken this approach of a couple of things. One is the people that I admire and and the concepts I, I try to understand where they come from and how they came up with those concepts in the first place. And, and what, what, what was the constraints or the opportunities of how they were growing up in their experiences that led them to build these mindsets. And so, you know, and I know this sounds cliche, but no, once my dad, he built the company in the enterprise infrastructure space, you know, hardware. What were the things that led him to believe that those things were important at that time? The frameworks that he used to be successful. You know, obviously folks like, you know, Mark Andreessen, Peter teal, other investors in the ecosystem that have, you know, started firms from scratch just like I have or I've started companies from scratch just like I, I always like to meet with them.

Arjun Sethi (36:11):

But honestly, the people that I actually admire the most are some of the folks that people wouldn't know. Our folks that have not necessarily succeeded but failed so many times that their story of timing how they built their company, their team what they went through, the hardships that they went through their post-mortem effective. Why it was a failing to me is a lot more important. And, and when I think about, you know, the frameworks we build and the folks to talk to, it's a lot of these folks that have spent time in, right on the data science side. We're not trying to talk to the folks that have built a data science houses that have been successful or we're, we're, we're talking to the folks that we're at the early innings of trying to create a framework on the investing side.

Arjun Sethi (36:57):

What worked, what didn't. And then a lot of what we learn, and again, I admire is our own portfolio of companies, of our founders that fail. What happened? What did they do right or wrong? What are the things that we could have learned quantitatively and, and see these leading indicators that were helpful. And you know, again, like I said, it's cliche beyond even my father, but almost every single one of our portfolio founders and any time they do anything regardless of success or failure, I admire it. Because the process that they had to go through to come up with those concepts of executing just like I had in the past. There's just so many variables. Well, and what I really like to tie, to try to do spend time and how do I get them to write more of that stuff down?

Arjun Sethi (37:44):

I have this one CEO Ryan Breslow of a company called bolt. He writes everything down good and bad, and he's just so maniacal about it. It's helped me to sort of think about how to take his best versions of what he does and apply that to a portfolio and founders that I interact with. How do I bring that up to our tribal founders that we interact with and how can I help augment their own thoughts back onto paper and writing so that we can quantify some of these frameworks that might be common denominator. And so, and so those are people that I, that I look up to. Besides the, the typical names that are out there, you know, books where you read and the people that, you know, no, of course I know some of these folks, but know a lot of their experiences are Zim rewriting history.

Arjun Sethi (38:32):

And I always get a little, Mmm. You know, skeptical of that because they've skipped over all the parts that were hard. And why do you skip the parts that are hard as humans? We don't want to remember it. You know, I'm, it's really, it's really hard for me to go back in a casual conversation and talk about all the pieces at low lapse. That was hard. Well like, why do I really want to remember it? You know, when someone like the way in which society is structured is how do you validate from the outside in versus inside out? And I think that's hard. And so when you calibrate I think it's always helpful to try to do that with people that have context and to unsuccessful attempts rather than calling them failures, what are the things that you learned from that?

Arjun Sethi (39:12):

And then how can you apply that those learnings and mindsets to the future of whatever you may be doing. And so I, I built software and in the past, I'm building software with my colleagues today at a venture investment firm which is a very different way of thinking about it because, you know, what's, what's different about what we do versus other people? Well, we deploy capital. We have a product we sell to founders, to LPs and our co-investment partners like other firms out there. And so what can we build to augment our time, our decision making, our evaluation and our advice that we give. And, and those, in some cases, our industries in themselves. And in some cases it's just workflow that's specific to us. So I feel like I'm in another red ocean of social gaming all over again because you know, what's the value proposition of venture capital? But, but it's fun because I also get to be at the forefront of working with really smart people that are building software for their verticals as well as myself speaking the same language by building software products that can help you communicate with the folks that we partner with. Amazing.

Elias Rubel (40:19):

Well, Arjun, it's always a pleasure. Thanks for coming on and sharing some of your amazing stories and looking forward to see what you build with tribe. Thanks, Eli. Thanks for having me. And again, appreciate the time.