tldr
Parker Conrad — CEO of Rippling, previously ousted from Zenefits in a very public firing — sits down for a raw 76-minute conversation about how rage and revenge fueled the founding of a company now valued in the billions. He's candid: Rippling was born from a revenge fantasy, and his team hoped he'd never lose that edge. But beyond the origin story, this is a masterclass in Compound Software strategy, CEO-as-clock-speed, hiring former founders to scale without sclerosis, and the Deel corporate espionage saga (a spy in Rippling's Slack, an Irish court order, a guy locking himself in a bathroom and factory-resetting his phone). Conrad's core thesis: don't let people box you into "A or B" decisions — insist on doing both.
Key Takeaways
- Revenge as rocket fuel. Rippling was born from Conrad's fury after being fired from Zenefits and publicly blamed. His team's reaction when asked about it: "I hope he never loses it." The darkest professional moment became the founding motivation.
- Compound software is the strategy. Building multiple integrated products isn't a sales/marketing play — it's an architecture conviction. Products that are seamlessly interoperable are genuinely better than best-of-breed point solutions. Companies using Rippling have half the back-office headcount of competitors at the same company size.
- The CEO sets the clock speed. Everyone else in the organization can slow things down. You're the only natural constituency for speed. If you don't actively push for velocity, entropy wins. This is one of your biggest jobs.
- "CEO in a box" decisions. Teams present you with "A or B, pick one." The real decision is usually that A and B can coexist. On principle, insist they find a way to do both. People are capable of far more than they believe.
- The CEO is the full admin. Conrad runs Rippling's own payroll for 4,000 employees across dozens of countries, approves every expense over $10, manages benefits and IT policies. The CEOs of ADP or Workday have never run payroll in their lives. That's his edge.
- Former founders make the best hires. 100+ former founders work at Rippling. They understand that the CEO asking for unreasonable things isn't creating the constraint — the market is. They've stared into the abyss and know that doing the "reasonable" set of things means death.
- Hiring: send the board deck first. Conrad's interview technique: send candidates the investor memo and old board deck ahead of time. First meeting is just their questions. Secretly, he's judging whether they ask smart, skeptical questions that get to the core of things. It simulates the actual working relationship.
- Six references, call two randomly. Ask for six (not two — everyone has two good ones). Call two at random. Then find people not on their list. The combination reveals whether they have six people who'd vouch for them.
- Homegrown + "been there done that." The best leadership teams are a mix. VCs immediately want to "uplevel the team" with external hires, but promoting people you've worked with closely lowers risk dramatically. The ideal: people you went to school with, worked with before, or have built trust over years.
- The Deel espionage was industrial-scale theft. Not a spy movie — a systematic program. A Rippling employee was recruited by Deel's CEO directly, paid to search Slack daily and send customer data, pricing, and competitive intel. When caught via an Irish court order, the employee locked himself in a bathroom, factory-reset his phone, and was told by Deel's lawyers to destroy evidence and flee to a country with no extradition.
Timestamps
| Time | Topic |
|---|---|
| 0:00 | "Rippling was born out of a revenge fantasy" |
| 0:48 | Host intro — Parker Conrad, most compelling CEO in Silicon Valley |
| 2:10 | Turning the darkest professional moment into competitive advantage |
| 3:36 | South Park underpants gnomes: Step 1 → Step 3, Step 2 is unclear |
| 4:16 | The Zenefits firing — "I wasn't allowed to talk about it" |
| 7:05 | Raising Series A with a scarlet letter — Sequoia's "one reason to do/not do this deal" |
| 9:10 | Due diligence depth: 50 executives vs. superficial Google searches |
| 10:12 | "I told you so" — looking back at the Zenefits departure |
| 13:01 | The press release that changed: "They f***ed you" |
| 14:47 | "One little ray of light — build this company or give up" |
| 15:48 | Advice on crises: "Don't do it. It's a terrible idea." |
| 17:33 | Second-time founder advantage — judgment on what matters |
| 19:16 | The few things that matter: mission, team, growth |
| 19:57 | "Zero doubt it was going to work" — knowing land is over the horizon |
| 21:22 | What people get wrong about being CEO |
| 22:08 | Against delegation dogma — "manage through your team" never worked for me |
| 23:31 | Going to the coal face — first principles over secondhand reports |
| 24:34 | Tax notices crisis: CEO + COO wiped calendars and did the actual work |
| 26:18 | The CEO as full admin — running Rippling's payroll for 4,000 people |
| 28:18 | Half the headcount: Rippling customers vs. competitors at same company size |
| 29:18 | Scaling from 4 to 4,000 — the people one level below you matter most |
| 30:41 | "Uplevel the team" — VCs' first instinct, often wrong |
| 33:08 | Hiring externally: 50% failure within 18 months |
| 33:29 | Interview technique: send the board deck, let them ask questions |
| 35:32 | Six references, call two — then find off-list references |
| 38:18 | When gut says the hire is wrong: "Always longer than a month" to decide |
| 40:22 | Scaling intensity — the CEO sets the clock speed |
| 42:10 | "CEO in a box" decisions — insist on doing A AND B |
| 43:13 | Patrick Collison's fast/slow organizations — orders of magnitude difference |
| 44:13 | Startups: between completely impossible and very very very hard |
| 45:38 | 100+ former founders at Rippling — why and how |
| 46:19 | Compound software — "not a sales trick, an architecture conviction" |
| 48:23 | The unrolled list problem — managers who can't find an alternate path |
| 50:08 | "If we don't do these things, we're dead" — former founders get this |
| 52:15 | Deel as competitor — "probably not the main one" |
| 53:15 | The Deel espionage: first inklings of a spy |
| 55:38 | Slack access, search histories, daily data theft |
| 57:22 | The investigation — Salesforce pulling internal logs |
| 60:06 | The sting: a planted Slack message with blacked-out sections |
| 63:55 | "Holy s*** they did it" — 4 AM confirmation |
| 64:36 | Irish court order, ex-parte process, office raid |
| 65:58 | Bathroom lockdown, factory reset, destruction of evidence |
| 67:22 | Deel's attorneys: "Destroy your phone, we'll relocate you to Dubai" |
| 69:03 | Going public: "I don't want the Overton window to shift" |
| 70:05 | Empathy for investors — "how impossible the job is" |
| 71:08 | "Everyone is fighting yesterday's war" — why most advice is useless |
| 72:10 | Host recap: hiring techniques, revenge as motivation, five-tool founders |
Relevance to SupportWire & FeatureOS
- Compound software validates the FeatureOS roadmap. Conrad's thesis — that integrated products are genuinely better, not just a bundling trick — is the same bet behind FeatureOS combining feedback, roadmap, and changelog. The conviction: a unified system where data flows between modules creates something point solutions can't match.
- "CEO in a box" decisions kill startups. When the team presents "should we build X or Y," the answer at this stage is usually both. Resources are tight, but the right question is "what's the constraint preventing both?" Not "which one do we cut."
- The CEO sets the clock speed. If you're not actively pushing for velocity at Skcript, nobody else will. Everyone else can slow things down through reasonable-sounding delays. Speed is your job.
- Half the headcount at the same company size. This is the pitch for SupportWire: companies using AI-native support tools should need half the support staff as companies using legacy tools. If you can prove this with data, it's the most compelling sales argument possible.
- "Everyone is fighting yesterday's war." Most advice about SaaS, pricing, distribution is based on conditions that no longer apply. AI changed everything. Don't copy playbooks from 2020.
Notable Quotes
"Rippling was born out of this revenge fantasy. That's what got the company going and it's certainly what kept me going for the first couple years."
"My team — I hope he never loses it."
"You're the only natural constituency for moving quickly. Everyone else in the organization can slow things down in the ways that they want."
"Teams present you with CEO-in-a-box decisions: 'We can do A or we can do B.' My immediate reaction is to just on principle insist that we can do both."
"People are often capable of so much more than they believe themselves to be capable of."
"It's absolutely true that this is a reasonable set of expectations for the team this quarter, and yet if we do the reasonable set of things, we're dead."
"The CEOs of ADP — they've never run payroll in their lives. Never."
"Everyone is fighting yesterday's war. That's why so much of the advice people give about how to do this is so useless."
One Thing to Act On
Audit your "CEO in a box" decisions. This week, look at every choice your team is framing as either/or. For each one, ask: "Is there really an 11th commandment that says we can't do both?" At a small company, you can't afford to cut scope by default — you need to find the path that does both, or at least understand the real constraint. The compound effect of always choosing A AND B is what separates companies that move 10x faster from ones that move 20% faster.
#rippling #compound-software #revenge #hiring #ceo #scaling #corporate-espionage #parker-conrad #founder-mindset
Raw Transcript
Auto-captions from YouTube. Folded by default — expand if you need to grep the source or pull an exact quote.
0:00 Rippling was born out of kind of this 0:02 like revenge fantasy. That's what kind 0:04 of got the company going and it's 0:06 certainly what what kept me going for 0:09 the first couple years. I love the 0:11 people I work with. I sort of really 0:13 like the problems that we're solving. I 0:15 feel like we're, you know, making a 0:17 difference for customers in this sort of 0:18 small way for their companies and that's 0:20 all extremely motivating. But early on, 0:23 you know, it's it's a grind. People come 0:24 to me all the time. They're like, "Oh, 0:25 I'm like thinking about doing, you know, 0:26 starting a company. What do you think?" 0:28 And my advice is always like, "Don't do 0:29 it. It's a terrible idea. 0:39 [music] 0:48 Okay, in this episode you're going to 0:50 hear from Parker Conrad. He's one of the 0:53 most compelling CEOs in Silicon Valley 0:55 in my opinion. He runs Ripling. It's an 0:58 amazing back office software company. 1:00 It's a $17 billion market cap with 4,000 1:03 employees. Incredibly successful. Almost 1:06 everyone, including myself, never 1:08 thought he would get this company off 1:09 the ground. And that's because he was 1:12 very violently fired from his last 1:14 company's benefits. And I remember when 1:17 that went down and I thought, man, he's 1:18 done. He'll never get up off the mat. 1:20 And I'm really impressed he has and and 1:22 how well he's done. He's also had a lot 1:24 of drama with a competitor deal very 1:26 recently who was spying on information 1:29 inside his systems and there's a lawsuit 1:31 and arrests and all kinds of drama 1:33 around that. So there's lots of good 1:34 drama in here for you who are into that. 1:37 But in between the drama, there's some 1:39 pearls of scale up CEO wisdom. He's not 1:42 your typical CEO. He rethinks things 1:44 from scratch in a way that I find 1:46 compelling. I like the way he thinks 1:48 about hiring. I think it's quite 1:50 interesting how his company has over 100 1:53 former founders in it. I like the way he 1:55 thinks about scaling without getting 1:57 sclerotic. 4,000 people is pretty big. 2:00 It's still moving fast. Very hard to do. 2:02 And I like how his chip on his shoulder 2:05 can supercharge his whole career. And 2:06 that can supercharge yours, too. So, 2:08 he's going to get into that. Parker's 2:10 basically written the book on turning 2:12 your darkest professional moment into 2:14 your greatest competitive advantage. I 2:16 hope you like it. How you doing? 2:19 >> Doing pretty good. 2:20 >> At Sequoia, one of the things they 2:22 always talk about is they like founders 2:25 with chips on their shoulders. Do you 2:27 have a chip on your shoulder? 2:28 >> I think so. Um I think it's like, you 2:31 know, maybe faded a little bit over 2:33 time. You know, I tried very hard to 2:35 keep it honed to razor sharpness, but I 2:37 think certainly Rippling was born out of 2:40 kind of this like revenge fantasy. Um, 2:43 and like that's what kind of got the 2:45 company going and it's certainly what 2:48 what kept me going for the first couple 2:50 years. You know, there are a lot of 2:51 other things that I love about my job. I 2:53 love the people I work with. I sort of 2:55 really like the problems that we're 2:57 solving. I feel like we're, you know, 2:58 making a difference for customers in 3:00 this sort of small way for their 3:02 companies and that's all extremely 3:03 motivating. But, but yeah, early on, you 3:06 know, it's it's a grind when you're 3:08 starting a company. And, uh, this wasn't 3:10 like my first rodeo. It's my third and 3:13 doing it the third time around. I think 3:15 they're really like it was helpful to 3:18 have this like extra bit of motivation 3:20 that was there for me every night when I 3:23 went to bed and like every morning when 3:25 I woke up. 3:26 >> Do you think that you have exacted 3:29 revenge on those doubters and those 3:32 people who did you wrong or not? And do 3:36 you think you'll ever put that to bed in 3:38 your own brain or is it is it a source 3:41 of constant motivation for the rest of 3:43 your life? 3:44 >> I don't know. It's so um Have you ever 3:46 seen there's a South Park episode? The 3:48 the Underpants Gnomes. 3:50 >> I love it's my favorite episode. 3:52 >> So it's sort of Yeah, Underpants for for 3:54 people who aren't familiar with it. You 3:56 know, the kids sort of follow these 3:57 gnomes that are like stealing everyone's 3:59 underpants and they follow them to their 4:00 secret underground layer and they're 4:02 like, "Why are you stealing everyone's 4:04 underpants?" And there's this sort of 4:05 secret plan for world domination. And 4:07 it's like step one like steel 4:08 underpants, step three, world 4:11 domination. And the kids are like, 4:13 "What's step two?" And they're like, "Oh 4:15 [ __ ] we never really we never really 4:16 thought about that." And sometimes I 4:18 think it's a little bit like that with 4:20 me where it was like, you know, I felt 4:21 like when things went south at Zenits, I 4:24 wasn't allowed to talk about it and the 4:27 entire story was being written by sort 4:31 of my antagonists, you know, that were 4:33 just saying all the stuff that, you 4:35 know, I felt wasn't wasn't true, wasn't 4:37 actually was going on, like it was 4:38 unfair and I couldn't do anything about 4:40 it. And so for me there was always kind 4:42 of this idea where I was like step one 4:45 build this like multiundred billion 4:48 dollar outcome in like the exact same 4:51 space and by doing it in exactly the 4:53 opposite way of everything that they 4:54 said was like the right way to do it and 4:57 then like step three was like somehow 4:59 like you know get get like revenge on 5:01 all of them and like step two was like 5:03 always sort of like vaguely like how's 5:05 like A connected to B was like sort has 5:07 always been sort of unclear. The 5:09 company's a lot of fun, you know, like I 5:10 I started out and 5:12 >> not just revenge. 5:13 >> Yeah. I mean, everyone sort of told me, 5:14 well, you need to develop actually early 5:16 on like our our our series A investor, 5:20 you know, I I was very open about these 5:22 motivations and and Mimoon was like, 5:25 "Hey, that's kind of dark. Like, maybe 5:27 you should maybe you should talk to 5:28 someone about that." And actually, 5:29 there's like an exec coach that came in 5:30 and I talked to this guy and you know, 5:32 he was sort of constantly like, "You 5:34 need to have all these positive 5:35 motivations and no negative 5:36 motivations." and he went and he did 5:38 sort of interviews with all of my direct 5:40 reports of the company and one of his 5:43 questions was like, "How do you feel 5:44 about the fact that Parker is like 5:46 motivated in these ways?" And and 5:48 everyone was like, "I hope he never 5:49 loses it." And so there was definitely 5:51 like 5:52 >> that element of it. Um but like over 5:55 over time I think you know despite all 5:59 of my attempts to sort of like focus my 6:02 anger on this stuff I think that yeah 6:05 like the a lot of you know sort of 6:07 dayto-day is like you know all of that 6:09 stuff is very distant and it's much more 6:12 about sort of the excitement of what 6:14 we're building and the problems that 6:16 we're solving and the people that I work 6:19 with who I really enjoy working with. 6:20 >> Yes or no? Have you exacted revenge on 6:25 your antagonist from Zenitz? 6:28 >> I don't think so. 6:29 >> Will you at some point answer that 6:31 question as a yes? And at what point is 6:34 that a yes? 6:35 >> I'm not sure that there is any 6:38 just$undred 6:39 >> billion dollar IPO kind of thing. It's 6:42 like, okay, check. I was right. I don't 6:45 think that that I'm not sure that like 6:47 one leads to the other, you know, and I 6:50 think that you don't necessarily get 6:52 that kind of satisfaction, 6:54 >> but also 6:56 everything sort of fades with time. It 6:59 stops 7:00 >> being the thing that is like the focus 7:02 of what you're doing every single day. 7:04 >> I remember when that whole thing went 7:05 down 7:08 and then I remember you got your series 7:10 A and I thought, 7:13 okay, you had a Someone painted a 7:15 scarlet letter on you and I was like 7:18 it's going to be hard for him to raise 7:19 again and you raised. You talk about 7:22 that fund raise and 7:25 how did it go down like getting over 7:27 that must have been non-trivial. 7:30 >> It was a weird process because um there 7:35 were definitely like I mean at the time 7:37 Ripling was doing really well. I mean 7:39 like the numbers we kind of showed 7:40 everyone our numbers and the numbers 7:42 were I think quite impressive 7:43 >> and you and you had personally you know 7:46 angel funded it I assume you seated it. 7:48 I I I did some amount and then and then 7:51 we raised a seed round where we had a 7:53 bunch of like really early believers a 7:55 lot and a lot of them were 7:57 >> former ZS seed investors 7:59 >> y 8:00 >> who really who backed me again 8:02 >> and a lot of sort of people in the YC 8:04 community YC partners initialized Gary 8:07 Tan Sam Alman all those guys 8:09 >> you're doing the A you got the scarlet 8:11 letter 8:11 >> and so then we went out to raise to 8:13 raise our series A [snorts] and it was 8:15 it was very controversial and there you 8:17 know there were like every firm was 8:19 really interested because the numbers 8:20 were so good. Um, and I think there were 8:23 a couple of firms that went really deep 8:26 like the basically at the at the time 8:28 our the partner at Sequoia Mike Vernal 8:31 who was looking at the deal um Mike came 8:34 to me and he said look there's one 8:36 reason to do this deal and there's one 8:38 reason not to do this deal and they're 8:40 the same reason. Um, and that was what 8:42 everyone was trying to figure out. And, 8:44 and I think, you know, Sequoia 8:47 went really deep and, you know, I think 8:50 Mike told me that, you know, you guys 8:51 did, I mean, because Sequoia always does 8:53 this just incredibly deep diligence. you 8:56 know, talked to like 50 different 8:58 executives or people in management 9:00 positions at ZFenefits to really 9:02 understand the picture and came away 9:04 with a lot of conviction that they felt 9:06 like okay we you know we Sequoia feel 9:09 very very comfortable with this. 9:10 Unfortunately, we didn't end up working 9:13 with Sequoia at that point. It was a 9:14 little bit later. Yeah. Um but a couple 9:16 of other firms did that as well and 9:19 there were a couple that kind of just 9:21 like backed out and you know one firm 9:24 sort of lead guy there you know called 9:26 up David David Sachs and you know I got 9:30 a phone call on a Sunday night said hey 9:32 so and so spoke with David we've got to 9:34 cancel the meeting on a Monday you know 9:36 like it was just that there was sort of 9:38 a more superficial amount of diligence 9:41 on it. there were these two camps. Um, 9:43 and uh, and you know, but even so, there 9:46 were enough people in the camp of like 9:49 we're excited about the business and not 9:51 concerned about the history that the 9:54 round was like really competitive and 9:56 got done 9:57 >> nice, 9:57 >> you know, on great terms. We were pretty 9:59 excited about it. 10:00 >> When was the last time you saw David? 10:01 >> I have not spoken to him since about a 10:05 week before I left. 10:07 >> I see. I've sort of like seen him across 10:10 the room at a conference since then. 10:12 >> Is there anything you want to say to him 10:13 today? 10:15 >> Uh 10:17 pro probably not a great idea. 10:19 >> How about I'll say it for you. I told 10:22 you so. [laughter] 10:24 >> I don't actually I don't actually think 10:25 that that's what I think like if I was 10:28 talking to David, it would really be 10:31 like why, you know, like why? Like I 10:34 look at it, it just it feels like it was 10:36 so unnecessary. Yeah. 10:38 >> You know, like like even in a world 10:40 where they were like, "Hey, we've got to 10:41 make a change." 10:43 Like those types of things are usually 10:45 not accompanied by the type of character 10:48 assassination like and it was like 10:52 deep and prolonged 10:55 effort like they hired people [snorts] 10:57 and those people were were sort of doing 10:59 this in the media like pitching stories 11:01 but like week after week after week and 11:03 that is just like it's unusual it's 11:05 expensive it's like a lot of effort. I 11:07 remember it went down. I remember the 11:09 media. They wrote they they wrote some 11:10 things that were very tough. They 11:12 basically blamed a lot of stuff on you. 11:15 I don't remember the prolonged, but why 11:17 do you think they thought that was a 11:19 good idea? I mean, they're relatively 11:21 rational economic actors. Some of this I 11:25 think is like David and some of this you 11:27 sort of see in the way that David I mean 11:30 is like you know very successful 11:34 as sort of this more political type of 11:37 actor and I remember David came to me at 11:40 one point 11:41 >> we know at Zens when we were having our 11:43 own sort of conflict with ADP we ended 11:45 up in in some litigation with them and 11:48 David told me he said look here's the 11:50 thing if you're ever in kind of one of 11:53 these media [ __ ] fights, 11:56 you want to attack, attack, attack, 11:59 attack. 12:00 >> And if the other guy 12:02 >> rolls over and cries, "Uncle," 12:05 >> that means it's working. And you want to 12:07 keep attacking, attacking, attacking, 12:10 attacking. And and I think that that was 12:13 like his playbook. Like that was like 12:15 sort of the way it operated. And you 12:18 know, and and some of it, it wasn't it 12:20 wasn't just that like they blamed me for 12:22 everything. I mean like look ultimately 12:23 I'm the CEO. I I you know I am 12:25 responsible for things. It was the way 12:27 that things that were mistakes, you 12:30 know, that were like, hey, we we thought 12:32 this was what we were supposed to do and 12:35 it was something else were instead the 12:38 legal word for this would be like, 12:41 you know, like there's some intentional 12:42 kind of thing 12:44 >> for what was I think in retrospect 12:47 much more just sort of accidental like 12:49 as companies are growing quickly and you 12:53 know little things that you know you 12:54 sort of don't recognize. as or just 12:57 unaware as like things that are h you 12:59 know suddenly are like actually you 13:01 overlooked something. 13:03 >> How did you feel like when you first saw 13:05 it? I assume you didn't have a heads up. 13:08 You saw it like was it anger? Was it 13:11 confusion? What did you say to your 13:13 wife? Like what was going on inside the 13:16 four walls of your body? 13:17 >> One of the things that happened right 13:19 before the announcement is um I was like 13:23 so depressed about the whole thing. 13:25 Yeah, 13:26 >> that I stopped looking at the media and 13:30 I didn't read 13:32 stories about me or about Ripling for 13:35 like 13:37 five or six years from that point. It 13:39 was a long time 13:40 >> or or Zenits. 13:42 >> Um and my wife would always read them. 13:44 And so when the announcement came out, 13:46 there was a press release that that we 13:48 had drafted and it was sort of one of 13:49 these sort of anodine things that was 13:51 like, hey, look, company needs new type 13:53 of leadership. 13:55 >> Parker, you know, like great job taking 13:58 it this far. Yep. 13:59 >> David coming in wants to spend more time 14:01 with his family. Typical stuff. 14:02 >> Typical stuff. and [laughter] and uh and 14:05 instead they just like David issued a 14:08 different press release and the the 14:09 press release was like 14:12 this company has a whole bunch of 14:13 compliance problems. It's because you 14:16 know Parker doesn't care about 14:17 compliance. He's not here anymore. 14:19 >> Yeah. 14:20 >> And it went south from there. And I 14:22 remember, you know, when it came out, um 14:24 I mean, it was such a shock. Um it was 14:27 just very unexpected. And then it it 14:29 just got worse from there. And it was 14:30 actually my wife that read it and turned 14:32 to me and said, "Oh, they they [ __ ] 14:34 you." Like, don't. She was like, "Don't 14:36 even read it. Like, don't look at it." 14:37 It was deeply depressing. I mean, there 14:39 were like really really dark moments. 14:42 And some of like the chip on the 14:43 shoulder was kind of like I'm either 14:47 there was sort of this one 14:50 little ray of light, this one path out 14:53 which was like, 14:55 you know, build this company and make it 14:57 successful or like it's just all over 15:00 and you kind of give up. And it was kind 15:02 of like it felt like those were the two 15:03 choices and like that and that was 15:07 very hard and very depressing, but it 15:08 was also like very clarifying and very 15:10 motivating that I felt like okay like 15:12 this is like this is the only thing that 15:14 I'm here for and this is the only thing 15:16 that I care about is like making this 15:19 thing work. 15:20 >> Okay. 15:21 >> A lot of people listening are founder 15:25 CEOs. People want to be CEOs. You've 15:28 been through some crises in some [ __ ] 15:30 shows. Yeah, 15:31 >> I have two advice for people 15:35 crisis going on. 15:37 Most CEOs hit some big [ __ ] show crises 15:41 during their tenure. Any advice? 15:44 >> People come to me all the time. They're 15:45 like, oh, I'm like thinking about doing, 15:46 you know, starting a company. What do 15:47 you think? And my advice is always like, 15:48 don't do it. It's a terrible idea. 15:51 [clears throat] And like I and people 15:52 always sort of laugh. They're like, 15:53 haha. But like it it's very like it's 15:56 very real. Like I do think that it is 15:59 like like much much harder than people 16:02 expect. It's not just that it's hard to 16:04 be successful. It's that it's sort of 16:07 really kind of soul destroying like even 16:09 when you're successful and very hard to 16:11 kind of manage your psychology through 16:14 through that that process and people 16:16 come out the other end. And there's a 16:18 lot of you know there's a lot of I think 16:21 talk about you know failure being sort 16:23 of this positive thing that you learn a 16:25 lot from. And actually I think you don't 16:28 learn a whole lot from failure and you 16:31 learn a lot more from success. And 16:33 [clears throat] it's really hard. You 16:35 know, usually I think people I see many 16:37 more people that do something like this 16:39 and don't succeed and it sort of like 16:41 destroys a lot. you know, it destroys 16:45 marriages, relationships, 16:48 um, you know, ambitions, you know, like 16:52 people kind of come out like a shell 16:55 their former selves and and so it's not 16:57 something that I that I'd recommend. 16:59 >> I kind of agree. I describe HubSpot as 17:01 like two steps forward, one giant step 17:04 back, two steps forward, one giant step 17:06 back, like 17:07 >> over and over again. 17:08 >> It was, it looked smooth and easy from 17:10 the outside, but man, it was a grind. It 17:12 was not easy and there were there were a 17:15 lot of moments where I really hated my 17:16 job. 17:17 >> Yeah. 17:17 >> Um you feel the same way? 17:20 >> Yeah. I mean I would say that um one 17:22 thing that was that was different about 17:24 Ripley. I think in part because of the 17:27 experience at Zenits is like people 17:29 sometimes ask me like you know what I 17:30 learned and and you know sort of there's 17:33 like insucently I'm kind of like I 17:35 didn't learn anything like you know 17:36 Zenits failed for dumb reasons and like 17:38 there was nothing to learn from that. 17:40 Um, but I I do think that like, you 17:43 know, over time you sort of slowly 17:45 accumulate a kind of pattern recognition 17:47 about like what matters and what doesn't 17:50 and and that can that makes things a 17:54 little bit easier because there are a 17:55 lot of things that come up 17:57 >> where you're like this probably doesn't 17:59 matter. Yeah. you know, and when it 18:01 sucks, but like it's nowhere's near and 18:03 and and no matter how bad things have 18:05 ever been at Ripley, they have never 18:07 come even close to how bad things were 18:10 in the sort of 6 months, 18:12 >> like you know, right after the end of 18:14 Zettz or when when I left Zenetss and so 18:16 everything kind of pales in comparison 18:18 and and that is always uh that's sort of 18:22 comforting in a way. What 18:24 >> you brought something up, what matters 18:26 and what doesn't? like what matters that 18:29 people don't think matter and what 18:30 doesn't matter that people think 18:31 matters. I mean sort of the advantage of 18:34 having done something before I think you 18:36 start to have good judgment about what 18:39 is you know because so many of the 18:41 things that come up are probably like 18:44 doesn't matter y 18:45 >> not going to make a difference and some 18:47 things come up are like oo that one's 18:49 going to count 18:50 >> and I think it's hard for firsttime CEOs 18:55 to really see the difference between 18:57 those it feels like everything's going 18:58 to matter and and that's part of why 19:00 it's like so overwhelming and awful. 19:02 >> Yeah. 19:03 >> Um and some of the things really 19:04 actually do matter. Um 19:05 >> what really matters? 19:08 >> I think getting your strategy right, 19:10 like where are we headed in the bus and 19:13 getting the right people on the team are 19:16 really important things and a lot of 19:19 other stuff can fall by the wayside. 19:21 >> Yeah. I mean, those things matter. 19:22 >> Getting like your mission set up so 19:24 people can get excited about the darn 19:26 thing. 19:27 >> Yeah. [clears throat] I'm trying to 19:27 think like I mean I think like there are 19:30 little little things that go wrong that 19:32 feel very consequential in the moment 19:33 that you start to realize over time 19:36 don't matter and like if you're not 19:38 growing that that obviously matters. At 19:42 Ripling it took us like two years to get 19:45 to a point where things started working. 19:47 >> Yeah. Hub was about that too. And like 19:49 for two years it was sort of this 19:52 exercise to try and like basically beg 19:55 the team not to leave until until things 19:57 started working. Yeah. But there was 19:59 also like 20:00 >> zero doubt in my mind that it was going 20:03 to work. And that that was sort of a big 20:05 difference because like I sort of knew 20:08 >> that like if you built these things and 20:11 got and got to this sort of, you know, 20:14 this island of product market fit that 20:17 was admittedly pretty far over the edge 20:19 of the horizon line, but like I knew 20:21 that there was land out there and and 20:24 that if you could get there, this was 20:26 going to work. And I, you know, had 20:27 having seen what was working and why at 20:30 Zenits, I just had like unshakable 20:34 conviction that this was. And so there 20:36 was never a doubt that was going to 20:36 work. And it was merely about like 20:38 whether like quite frankly we could keep 20:41 prevent everyone from quitting 20:43 >> like before we we got there. And so 20:46 early on actually like you know trying 20:47 to just keep the team together 20:50 >> mattered a lot. and and and at that 20:52 point whether it was like working today 20:54 or not like didn't so much in the this 20:57 very specific context of the company 20:59 that I was building and I think for a 21:01 lot of other companies that's not true 21:02 because like you know you might believe 21:05 that things are going to work but you're 21:07 probably wrong or you know like you're 21:08 if you have a lot of conviction about it 21:10 your conviction is like misplaced. Yeah, 21:12 >> maybe mine was too but I you know like I 21:14 was sort of crazy enough or believed 21:16 that I had reasons to believe that this 21:18 was going to work. Parker, um, 21:22 >> you're kind of a contrarian along a lot 21:24 of lines. That's one of the things I've 21:25 always liked about you. What do people 21:28 have totally wrong about being a CEO? 21:32 Like there seems to be sort of a 21:34 rulebook around it that is kind of 21:37 getting rethought these days and I feel 21:39 like you're rethinking pieces of it. 21:40 What What's all wrong about CEOing? Um, 21:46 >> what do these founder CEOs, what 21:48 mistakes are they making? 21:50 >> Well, I'll tell you. Um, I mean, I don't 21:53 know. I know so little about like any 21:56 business that's not my own. So, it's 21:58 hard it's hard for me to have like big 22:00 opinions about like sort of the 22:02 ecosystem. But I think that like one 22:04 thing that I that I um sort of believe 22:08 in that that maybe is becoming like you 22:11 know more more sort of um more more of 22:15 the conventional wisdom today um is I've 22:18 always struggled with the idea that as a 22:21 CEO you're supposed to kind of manage 22:22 top down through a set of deputies and 22:26 you know you you hire people who are 22:27 knowledgeable about this area you trust 22:30 them and you let them kind of do their 22:32 thing. Um, and that's just never worked 22:34 for me. Like what's what's what's worked 22:36 is 22:37 >> you kind of have to reason from first 22:41 principles. And and you could do that 22:42 with some of your lieutenants who can 22:44 help you through it to sort of convince 22:46 yourself of exactly what the right 22:49 approach is in in that area. And and you 22:51 have to have like real on an on the 22:54 ground understanding of what's actually 22:56 going on um yourself. Um, and if you 22:59 don't have that, like that's the only 23:01 thing that's that's worked for me. 23:03 >> Um, and it's really it's tough to scale. 23:06 It's tough to scale that. You know, it's 23:08 it's hard it's hard on you. I think it's 23:10 hard on some of the other people, but 23:11 it's the it's the only thing that's sort 23:13 of um 23:15 worked for me and the only thing that 23:16 it's the thing that's really worked for 23:17 Ripling. Um, and so we have a leadership 23:20 principle that we've formalized on this 23:22 that we call go and see. That's that's 23:24 basically like look if you're it's true 23:26 for me but it's also true for you know 23:28 executives and and managers that like 23:31 you know you've got to you've got to go 23:33 right to the ground 23:35 >> cold face. 23:36 >> Yeah. And get that's a good way of 23:38 saying it, right? Um and you've got to 23:41 you know something there was a point in 23:43 time where things were just like really 23:46 going wrong with tax operations and like 23:50 you know we're we're a payroll company. 23:51 One of the things that we do is we do, 23:53 you know, we do these sort of quarterly 23:55 filings for clients and, you know, there 23:58 are thousands of agencies across the 24:00 country that you need to send these to 24:01 and there are a million little things 24:03 that can go wrong and if anything's off 24:05 by like a penny, clients get like angry 24:07 letters about this and it's really bad. 24:10 things were going wrong. Like the notice 24:12 the rate at which clients were getting 24:13 notices from Rippling we knew was like 24:15 higher than the notice rate at other 24:18 companies and it was like a an 24:20 existential threat to the business and 24:22 like that was something where there was 24:23 some muscle memory for me that this was 24:25 actually something that would kill the 24:26 company 24:27 >> that matters. It was something that 24:28 matters. Um, you know, the only thing 24:30 that worked to solve it was, you know, 24:34 was what happened is I got, you know, 24:36 like me and my COO and like, you know, 24:40 the person running the team and like 24:41 someone else. We sort of wiped out our 24:43 calendars and we sat down and we said 24:45 for the next week, you know, we're going 24:48 to just be tax ops agents. And so, we're 24:51 literally going to, you know, because 24:53 there was this growing backlog of 24:54 notices that needed to be addressed that 24:56 clients were sending us. And we're just 24:58 going to pick from the queue and start 25:00 figuring out like calling up the tax 25:03 agency. Why did the client get this 25:06 notice? What happened? You know, why did 25:07 they believe that, you know, the the 25:10 amount was wrong or the money didn't get 25:12 there or the filing was not on time or 25:14 something? and and then reverse engineer 25:16 it in our systems and be like and it was 25:18 just like doing doing the actual work of 25:21 doing it was the only and then sort of 25:23 like by doing that we developed this 25:25 understanding of like what was broken 25:27 about the process what was broken about 25:28 the systems what were the changes that 25:30 need to be made 25:31 >> but it was like impossible to diagnose 25:33 or understand without sitting there and 25:36 doing that. 25:37 >> Okay. on the matters thing. It seems to 25:40 me from just listening to you and I also 25:42 spoke to a couple people on your team, a 25:45 lot of things matter. And then one of 25:47 the insights I think you've had is 25:49 details matter from the CEO on down and 25:52 you're in the details in a big way for a 25:55 company that has four four or 5,000 25:57 employees. Is that fair to say? 26:00 >> Um 26:01 >> I think more more so than me for sure. 26:04 It seems like you are like you sit in 26:06 the middle of the engineering floor. It 26:08 sounds like you are on the coal face for 26:11 somebody in a pretty goodiz 26:12 organization. 26:13 >> I certainly try to be and so I I 26:16 >> that's I view that as like a huge 26:18 compliment if you know from from the 26:20 team. I think the place where I try and 26:22 do that the most and what's what's maybe 26:26 sort of most unusual about Ripling is is 26:29 that I'm the the only like full admin 26:33 for Ripling in Ripling and so like I run 26:36 payroll for the entire company across 26:38 dozens of countries. I manage sort of 26:41 like benefits and you know a lot of like 26:44 you know IT policies and other stuff 26:45 within within the system. 26:47 >> Yep. you know, approve expense 26:49 reimbursements, things like that. Um, 26:51 >> I was similar to HubSpot. I was a very 26:54 active user of HubSpot, one of the most 26:56 active users for many. 26:58 >> So, I think that's important. It's like 26:59 one of the things like people, you know, 27:01 learn when they join Ripple is like the 27:03 CEO approves every expense reimbursement 27:05 over $10. And the reason for that is 27:08 like not [clears throat] that I'm like 27:10 this jerk that's like harassing people 27:13 about their expenses. It's that I'm 27:16 trying to actually use the product in 27:18 the same ways that that clients would 27:20 that like a diligent 27:22 >> controller or you know sort of 27:24 accountant yeah 27:25 >> would use the system and help review it 27:27 in the same ways that they would and try 27:28 and use that to sort of iterate and 27:30 improve on things over time. There are a 27:32 lot of things that that we get wrong as 27:34 a company. But I do think that that that 27:37 element is like a little bit of a 27:38 superpower because I I know that, 27:42 you know, the CEOs of, you know, ADP or 27:46 >> they're not doing that 27:47 >> or whatever, they've never run payroll 27:49 in their lives. Like never. um you know 27:53 there's a a sort of on the ground 27:55 understanding of the system and that you 27:57 know that doesn't mean that you know we 27:58 always get everything right but I think 28:00 that um you know it's a it's a sort of 28:03 control on the system and and one of the 28:07 ways that it play one of the things that 28:08 I'm most proud about is that we did this 28:10 study where we we looked at companies 28:13 that use rippling and companies that use 28:16 anything other than rippling and some of 28:18 them use like 28:19 >> modern systems 28:22 competitors of ours that are sort of 28:23 more recent market entrance. Some of 28:24 them use the more old school systems and 28:27 you just look at how many people those 28:29 companies have in HR, IT and finance 28:32 roles and GNA roles within the 28:34 organization based on LinkedIn data. And 28:37 what you find is that the companies that 28:38 use Ripling at any given size range, so 28:41 you you have to look at it by company 28:43 size obviously, you know, companies that 28:45 use Rippling have about half the people 28:48 in those functions than companies that 28:50 use anything else. 28:51 >> I love that. Um, I love that s and 28:53 that's look I think that that you know 28:54 it's not that you know our pitch is not 28:56 like hey like you know like lay off 28:58 people if you use Ripley it's those 29:00 extra headcount they they represent all 29:03 of this administrative burden they they 29:05 represent attacks on your business 29:07 because those are people that are just 29:10 moving data between systems dealing with 29:13 administrative pain 29:15 >> that you could instead redeploy for 29:18 things that matter within your business. 29:20 Parker, so you're in the details. You 29:22 just talked about your own CEO journey 29:24 from like the four of you to there's 40 29:27 of you to 400 of you, 4,000 of you. 29:30 Somehow you've managed to stay in the 29:32 details. How has your job changed? What 29:34 advice do you give to that founder with 29:36 40 people on how to scale it? How did 29:40 your job change and how did your 29:42 daytoday change? I think probably the 29:45 most important thing was the like the 29:49 people a level below me. And honestly, I 29:52 think that probably like their jobs have 29:54 changed a lot more 29:55 >> interesting 29:56 >> than than mine has because 29:58 >> the executive team at Ripling has been 30:01 like pretty like stable over time. Um 30:05 there's been like there's been some 30:06 turnover but I think you know a lot of 30:09 the people that are there you know like 30:11 our CRO was the eighth person in the 30:15 company and you know my COO joined when 30:18 you know right after the series A but he 30:20 and I you know had known each other 30:21 since college so we've been friends for 30:23 a long time 30:24 >> you know there have been a bunch of 30:26 people that have sort of been there a 30:27 long time and so there's just I think a 30:30 lot of trust um and uh I think every you 30:34 how everyone's kind of grow like 30:35 everyone's sort of grown in in the in 30:37 their in their function and in their 30:38 job. 30:39 >> Okay. 30:39 >> Over time, 30:40 >> one of the things I've noticed, Parker, 30:41 VCs do as soon as they make their 30:43 investment, like the first thing they 30:44 say is like, "We got to uplevel the 30:46 team." 30:47 >> Yeah. 30:47 >> And when I look at the best companies, a 30:50 lot of the management teams are kind of 30:52 homegrown. Like a lot of HubSpot's 30:54 management team been there since the 30:56 pretty early days. Uh what do you think 30:59 of that advice? I think Homegrown's 31:01 really underrated. Home Road's 31:02 underrated, but also like if the people 31:05 sometimes the people that you're trying 31:07 to grow are not going to make it 31:09 sometimes, you know? And so I think what 31:11 I would say is like hiring people that 31:14 you just are you're really close to. I 31:17 mean, it's weird to say, but hiring 31:18 people that like you've worked with, 31:20 that you're friends with, that you enjoy 31:23 working with, like 31:23 >> really lowers the risk. 31:24 >> Really underrated, actually. 31:26 >> Lowers the risk. It's underrated. Yeah. 31:28 and and so 31:29 >> went to school with. 31:31 >> Yeah. There are people that we brought 31:32 in that, you know, we hired that were 31:34 not like that that have been 31:35 unbelievably successful as well. 31:37 >> Yeah. 31:38 >> Um 31:39 >> but there is something to the fact that 31:41 like um you know for the for a long time 31:45 Ripley CMO he's now stepped into a 31:48 different role but was this guy Matt 31:49 Epstein who was like you know I worked 31:52 with him as CMO at my first company. He 31:55 was CMO at Zens. He joined Riplane, was 31:58 CMO at Ripley, like it was just this 32:00 longstanding like professional 32:02 relationship that I had and um and 32:06 there's some there's sort of something 32:07 to that. I feel like I have a pretty 32:09 good sense of whether someone's going to 32:12 make it or not and I'm sort of wondering 32:14 like how would I do, you know, your job 32:17 at Sequoa and advise like an 32:20 entrepreneur on their team. I would have 32:22 a lot of humility about it and I would 32:23 be like, man, I just don't I don't know 32:25 how I would explain that or judge that. 32:27 And and one of the problems I think for 32:29 investors is I think it's actually 32:30 really hard to do from the outside. And 32:33 so even if you have like done it 32:35 yourself, you know, you're just not 32:38 spending enough time at the company to 32:41 really know about this exec and whether 32:43 they're going to make it. And so the 32:46 advice is like maybe not all that 32:47 useful. And then you know if you're if 32:50 you're an entrepreneur that's doing this 32:51 for the first time it just I don't see 32:54 how anyone figures I mean look looking 32:56 back I'm like I don't understand how 32:58 anyone figures their way through this 32:59 because it seems like so hard to know 33:01 having not seen it. 33:02 >> I'll tell you the one thing I've noticed 33:03 with so many of the early stage 33:05 mid-stage startups is their hit rate on 33:08 hiring that external been there done 33:10 that CMO see what is it's 50% within 18 33:14 months. It's much harder than it looks. 33:16 people don't talk about it. What have in 33:19 in this vein, you're interviewing 33:21 somebody. What what's your filter? What 33:24 are you looking for? What's your 33:26 process? Like do you is there anything 33:29 unusual you're doing around there that 33:30 you think you might be have some 33:32 intuition that people don't 33:33 >> Here's what I do. And I don't I'm not 33:35 I'm not saying that what I do is like 33:36 the right thing to do. Yeah. 33:38 >> But usually what I do is I send 33:41 candidates all of the in investor 33:44 materials that I prepared. So I send 33:45 them like we write up a memo on the 33:47 business. There's like some metrics and 33:49 I send all of that to them ahead of time 33:51 so they have context and they show up to 33:53 the meeting and I'm just like look this 33:56 first meeting is really just a chance 33:58 for you to ask me questions. So you know 34:01 sure you had a chance to look through 34:02 this. You know what what didn't make 34:04 sense to you? What were you like I don't 34:07 think that's right. You know what did 34:09 you have questions on and let's talk 34:10 through it. And then usually we sort of 34:13 talk through their questions and and and 34:16 sort of secretly 34:18 I I I'm sort of judging them by how that 34:20 conversation progresses. And so some 34:22 people have like no questions and that's 34:25 like that's usually pretty a pretty bad 34:27 sign. Or some people have like clearly 34:29 like fake questions. Um, and some people 34:32 like actually like even very skeptical 34:34 questions are really good. Like if 34:36 they're smart, there are some people 34:38 that like they immediately get to the 34:41 core of the issue, you know, where they 34:42 they identify like the two things that 34:44 are going to really be problems. And 34:46 then and then sometimes we have a great 34:48 discussion about it because, you know, 34:50 I've got I've thought about those things 34:52 too. You know, I spent a lot of time 34:54 like here's how we're approaching it. 34:55 here's what I think and here's what 34:57 didn't work and here's what I think is 34:59 going to work and this is why this is so 35:00 important and and and sometimes the 35:03 people that ask those really challenging 35:04 questions they get it really quickly and 35:06 they're like oh yeah and that means also 35:09 that and then as a consequence of that 35:12 and I think it works because it it kind 35:14 of simulates the act what the actual 35:16 working relationship is going to be like 35:18 where we're going to have those types of 35:19 conversations 35:20 >> in our one-on-one meetings and like 35:23 >> and and that's going to work and so 35:24 that's always been the thing that's been 35:27 most telling for me. That and back 35:28 channel references. 35:29 >> Yeah. 35:30 >> You know, like not I usually ask people 35:32 like give me like six references, 35:37 not two because everyone's got two. So, 35:39 you know, give me six and then I call 35:41 two randomly from that list and then I 35:43 try really hard to find people that are 35:45 not on your list. 35:45 >> I'm the same. Yeah. 35:46 >> And that that's been really telling. Um, 35:49 the thing that I've always I don't have 35:51 a good answer for is I found it's really 35:54 hard to summon great executives on 35:57 demand. And so, 35:58 >> wait, what do you mean by that? 36:00 >> Well, it's like someone suddenly someone 36:02 leaves or someone is like it's like not 36:05 going to make it and it's, you know, and 36:07 you're like crap, I need a CTO, 36:09 >> right? 36:10 >> Yeah. our current CTO, who's amazing, 36:14 was someone that randomly 36:18 fell into my lap, you know, that that um 36:22 someone at Sequoia introduced me to and 36:25 and and it was like, wow, like this is 36:28 amazing. And it was very clear that, 36:30 >> you know, this person was exactly who we 36:32 should hire, 36:33 >> but we'd hired someone else, 36:36 >> you know, 6 months earlier. It was not 36:38 working out. And we hired that person 36:41 sort of like it was one of those things 36:43 where we had been looking for so long. 36:45 >> Yeah. You gave up, 36:46 >> you know, looking for so long. It was 36:48 like, "Oh, maybe 36:51 maybe it'll work." You know, and and we 36:53 had 36:54 >> Does that ever work? 36:55 >> Never. Never. It never does. But like, 36:57 what are you going to I mean, like we'd 36:59 been looking I don't know. I think we've 37:00 been looking for like a year, you know? 37:02 It's just 37:02 >> And all the his direct reports report to 37:04 you in the meantime, which is like 37:06 brutal. 37:07 >> Yeah. And so um and you know and and so 37:10 what I mean I'll tell you what doesn't 37:11 work is like usually like exec 37:14 recruiters don't work. 37:15 >> Okay. 37:16 >> And 37:17 >> I was just about to ask you that. Okay. 37:19 >> Exact recruiters are you know great at 37:23 sending you solid B candidates. 37:27 >> And there's always the exception that 37:29 proves the rules. So we hired our CFO 37:33 who's amazing. good person to hire 37:35 through an executive recruiter, 37:36 >> through an exec recruiter, they're like 37:37 actually like really incredible. Yeah. 37:40 >> And so there are some exceptions, but 37:43 usually they send you a lot of of B 37:45 candidates. And the problem is that I 37:48 think the really incredible people, 37:51 >> they get snatched up totally 37:52 >> before they know with an exec recruiter 37:55 like they're they're like, you know, 37:58 they've always got people pinging them. 38:00 They get a million options 38:01 >> and they've got [clears throat] they've 38:02 got relationships with people and 38:04 someone is yanking them out and like 38:05 they sort of, 38:06 >> you know, they sort of secretly whisper 38:09 to their spouse that maybe they're 38:11 thinking about leaving and there's five 38:13 people the next morning that heard about 38:14 it 38:15 >> and are already like, you know, been 38:16 talking with them for a long time and 38:18 have worked with them before and have 38:19 been nurturing them on drip marketing 38:21 campaign. 38:22 >> Make it into the 38:23 >> Okay, let me ask related to this. You 38:26 hire someone, it's a month in, you're 38:28 like, [sighs] 38:30 I might have [ __ ] this up, but it 38:33 ended up working. Has that ever 38:35 happened? 38:35 >> Never. 38:37 >> Okay. So, a month in, if you if if your 38:39 gut tells you it's not right, you 38:43 just How long do you wait? 38:45 >> Always longer than a month. 38:47 >> How long do you wait? Six months. 38:48 >> I mean, yeah. Like I mean I like and the 38:51 frustrating thing is like I see this 38:54 behavior in managers at Ripling and I 38:56 get very upset about it and very angry 38:59 about it. Like why did you why did you 39:02 [ __ ] this up? You know like like you can 39:04 see it happening. Like I have this 39:06 conversation all the time where I'm like 39:08 you know I'm like okay here's your team. 39:10 >> How many of these people right now like 39:13 tell me which of these people you would 39:15 bet your career on? and like whoa. 39:19 And it's like, well, this person and 39:21 this person. 39:23 And I'm like, none of the rest. You're 39:24 like, well, it's a tough, you know, and 39:27 I'm like, okay, get, you know, like fire 39:29 all like, let's start over, you know, 39:30 and and like, well, no, no, you, you 39:33 know, there's all kinds of reasons why, 39:34 you know, can't, you know, not yet. And 39:36 inevitably, 39:37 >> they're all gone in a year. 39:38 >> They're all gone. But it takes a long 39:40 time 39:41 >> to get there and it's so frustrating, so 39:44 infuriating. And it's like why why can't 39:47 you as a manager just do the job that we 39:49 expect of you and make the hard 39:50 decisions and I make all the same 39:52 mistakes myself like you know it's 39:54 [clears throat] like all you know 39:55 equally difficult for me when things are 39:58 not working out. 39:59 >> It sounds to me from people I've spoken 40:02 with inside of Ripley and yourself that 40:06 it was an intense startup and all 40:10 startups are pretty intense but it's now 40:12 an intense scale up. You've kept that 40:15 pace and intensity up as you scaled 40:18 through the years. Most of the founders 40:20 I work with are really struggling around 40:22 100 150 employees. They're bringing in 40:25 new people they didn't know. Well, there 40:27 couple middle managers showing up. That 40:29 intensity and that pace doesn't seem to 40:31 scale. How have you scaled that? Well, I 40:34 think one one thing that I believe very 40:36 firmly is that there's ultimately only 40:40 one person in the organiz 40:45 and and it's you as the CEO. Um and and 40:49 so it's really one of your biggest jobs 40:51 is to sort of set the clock speed of the 40:53 organization. And the reason is is that 40:55 everyone else in the organization can 40:58 sort of solve for all of their problems 41:01 by just extending the timelines. you 41:03 know, like they can get it done to, you 41:07 know, in the ways that they want to get 41:08 it done. They can, you know, they don't 41:10 have to, you know, sort of make 41:12 unreasonable asks of people that 41:14 they're, you know, like every every 41:15 other constraint can be solved for with 41:20 more time. What happens is things start 41:22 to get like really slow and there are 41:24 real problems with that for the 41:26 organization long term, but usually not 41:29 for like any individual manager or 41:32 executive within the company. And so 41:34 you're the only natural constituency for 41:36 moving quickly. And so you really have 41:39 to be you really have to care about it 41:42 and and you have to sort of pay 41:45 attention when when people are trying to 41:48 slow it down. And so one of one of the 41:50 things that happens is like your team 41:52 will often come to you and they will 41:55 present you with what I call CEO in a 41:57 box decisions where they will say look 42:00 we can do A or we can do B like you 42:02 choose and it's this illusion of choice 42:04 >> tyranny of war. 42:05 >> Yeah. It's it's this but it's an 42:07 illusion of choice because the choice 42:08 has already been made for you because 42:10 the important choice 42:12 >> was the decision that A and B cannot 42:15 coexist. Um, and usually like my 42:19 immediate reaction when someone brings 42:21 me something like that is to just on 42:23 principle insist that we have both A and 42:26 B and like understand like what laws of 42:29 physics are violated 42:32 >> that prevent A and B from coexist. 42:34 There's like the second law of 42:35 thermodynamics problem. Sometimes it's 42:37 like it's much harder for the team to do 42:39 A and B and they would prefer not to do 42:41 that. Um, sometimes it's actually just 42:44 as simple as asking people for a third 42:47 path, you know, to like say, I don't I 42:49 don't like these options, like can we 42:51 just think a little bit harder and is 42:53 there some way to kind of get there? 42:55 When you think about like the pace at 42:58 which organizations move, 43:01 I think the natural thing is people sort 43:02 of believe, man, if you're like 43:06 tyrannical CEO that's like driving 43:08 people really hard and like you know 43:11 what's going to happen at most maybe 43:13 it's like 20% more. Patrick Collison has 43:16 this great site that he put together on 43:18 sort of like things that moved absurdly 43:20 quickly and things that moved very 43:22 slowly. And it's this example of like we 43:24 the space program to land someone on the 43:26 moon was like four years and the vaness 43:29 bus lane was like two decades or 43:30 something in San Francisco. And you sort 43:33 of look at these at two different 43:34 organizations that might both have good 43:38 well-meaning people. 43:40 >> And like you know the organization that 43:41 moves quickly it's like it it's like 43:43 orders of it's like an order of 43:44 magnitude faster. It's not like 20% 43:46 faster. It's just amazing what 43:48 >> what you can accomplish. And so maybe 43:50 the the sort of slightly more positive 43:53 way of articulating this is I think that 43:55 that people um are often capable of so 43:58 much more than they believe themselves 44:00 to be capable of. 44:02 >> And so if you can sort of challenge them 44:04 about the perceived constraints on the 44:07 problem and explain to them the impact 44:10 of being able to do A and B and why like 44:13 what happens if we could do A and B. 44:15 Startups are somewhere between 44:17 completely impossible and very very very 44:20 very hard. And there's such a narrow ray 44:22 of light that passes between those two, 44:24 right? The companies that make it 44:26 through usually at multiple points in 44:29 the journey find ways to do things that 44:32 are seemingly impossible. Yeah. Um, and 44:35 it is you have to sort of acknowledge 44:37 that what you're asking for is like 44:38 really hard and you understand that and 44:41 it's just there's no other way, you 44:43 know, and so let's sit down together and 44:45 think about whether it's possible. And 44:47 sometimes people find 44:50 clever solutions or new new reserves of 44:54 possibility to kind of get there. And if 44:56 you kind of do that enough, it compounds 45:00 >> and and like you can accomplish a lot 45:02 more than the company that isn't doing 45:05 that. 45:06 >> I had a line where somebody would bring 45:08 me something like that and I would say, 45:11 "When Moses came down from the mountain 45:14 and he had the tablet, 45:17 was there an 11th commandment that we 45:19 all missed that we couldn't do this 45:21 thing we're talking about right now?" 45:23 >> Yeah. Exactly. You know, Yeah. Like it's 45:26 not it's not a law of physics. We can 45:28 figure it out. 45:29 >> Okay. I hear you've got something like 45:32 40 or 50 exfounders on your management 45:36 teams in your company. What's going on 45:38 with that? Why are you doing it? How do 45:40 you manage that chaos? 45:42 >> I think it's actually a lot more than 45:43 that now. Okay. Um um but 45:46 >> why? Um I think that 45:49 >> are you aqua hiring or hiring like 45:51 what's it what's the 45:53 >> sometimes we aqua hire sometimes we hire 45:56 [clears throat] 45:56 >> um it's it's a profile that we look for 45:59 um 46:00 >> you know rippling you know we sort of 46:03 coined this phrase I know HubSpot 46:05 HubSpot's been doing this for a long 46:07 time but we coined this phrase of like 46:08 compound software 46:09 >> you know I'm really mad at you about 46:10 this 46:11 >> because we are a compound star but we 46:14 never came up with a clever name 46:16 >> I like you it had totally stuck and 46:19 everyone's like Parker's the original 46:21 like we're the original 46:22 >> compact spot was doing it long before 46:25 us. 46:25 >> Well done. 46:26 >> But we um the reason that we we do this 46:29 is because I'm convinced that this is 46:32 the right way to build software and that 46:34 actually we've been building software 46:35 wrong for a couple of decades now. Um 46:38 and most people believe yeah yeah you're 46:40 doing compound software. there are some 46:42 like sales and marketing advantages to 46:44 building you know good enough but 46:46 integrated products and like that's not 46:49 it at all like I think the belief is 46:51 that actually you can build better 46:54 products by building them in this 46:56 integrated way and you can do it because 46:59 the fact that these things are deeply 47:01 integrated and seamlessly interoperable 47:03 on its own makes them better 47:05 >> but also when you're building across 47:07 like multiple applications you can 47:09 afford to invest much more deeply 47:11 in a set of capabilities that are common 47:14 to all of the applications. You know, 47:15 things like analytics and permissions 47:17 and workflows and custom objects and 47:20 stuff like that. But I think a lot of, 47:22 you know, and this was sort of the 47:23 original, like before we were this 47:25 articulate about what we were doing and 47:26 why. 47:27 >> It was one of the original founding 47:29 principles of Ripling was that we were 47:32 going to do more things, not less. And 47:34 this focus thing was [ __ ] And like, 47:36 >> you know, that was like what David 47:38 wanted us to do, but that's completely 47:39 wrong. and we should do it this way and 47:41 and so a lot of 47:43 >> same with HubSpot. We're like this whole 47:44 focus thing like should do one thing 47:46 really well. We're like no we're going 47:47 to be very thin and but we're going to 47:49 get to table stakes at some point. It 47:51 was the exact same thesis we had. 47:53 >> Yeah. So yeah, 47:54 >> but a lot of the history of the company 47:57 is trying to figure out novel solutions 48:00 for the very real challenges with that 48:03 approach because there are a lot of 48:04 reasons why it is easier to focus on one 48:07 thing along the way. A lot of problems 48:10 come up and there are bottlenecks that 48:11 develop in different parts of the 48:13 organization 48:14 and one of the places that you know a 48:17 bottleneck forms is really at the level 48:20 of sort of executive attention around 48:23 these things and so you end up you end 48:25 up needing people who can be like the 48:29 CEO of these products or who can drive 48:32 things forward who can find a path 48:34 because a lot of people who are like 48:36 very good managers and executives in in 48:40 engineering or product or whatever, what 48:42 what they do is they they come to you 48:46 with problems and so they say there's a 48:48 series of gaps we have like in order to 48:50 win here's like a long list of things we 48:53 need to do and they unroll the list and 48:54 it rolls out onto the floor and goes all 48:57 the way down the hallway, you know, and 49:00 and like we've prioritized it by sort of 49:03 most important on on down and I have a 49:07 team of this guys. And this is about one 49:10 quarter's worth of work is like, you 49:12 know, these things this far down the 49:13 list. And so we're going to do one 49:15 quarter's worth of work and we're going 49:17 to solve these things. And and and 49:20 that's what it is. And the problem is is 49:22 like, yeah, but the list goes all the 49:24 way down the hallway. And and they're 49:26 like, well, but my job is to sort of, 49:27 you know, that's your problem, right? 49:29 like you're like and so they're asking 49:31 you to find a way to make ends meet 49:34 because you know they're like their job 49:36 is just to kind of move down the list 49:38 and and then you're you're still [ __ ] 49:41 because like at the end of the day 49:42 they're going to do those things but 49:44 you're still not you still haven't 49:46 solved the problem which is like you 49:47 need to win 49:48 >> and so you need people who can find ways 49:51 to do the impossible that sort of 49:53 understand 49:55 >> look like the CEO that's asking continue 49:59 to do unreasonable things. Like I didn't 50:01 create this situation. Like the market 50:04 created like this is the reality that we 50:06 find ourselves in which is like we need 50:08 to do these things and if we don't we're 50:12 dead we're screwed. And so we need to 50:14 find some way or some alternate path or 50:17 some sort of you know there needs to be 50:19 some effort to solve the whole problem 50:21 or like it doesn't matter 50:25 you know that 50:25 >> and you think exfounders are 50:27 particularly 50:27 >> I think exfounders understand that 50:30 >> breaking the laws of physics 50:31 >> or they just they've been in situations 50:34 where they've they understand that like 50:38 yeah like it's like we either you know 50:40 they they've sat there and stared at the 50:42 dwindling bank balance while, you know, 50:45 while the sales isn't working and 50:47 they're like, "Oh shit." And like, and 50:49 they understand that like, "Yes, it's 50:50 absolutely true that like, you know, 50:53 this is a reasonable set of expectations 50:55 for the team this week, this month, this 50:58 quarter, this year, and yet if we do the 51:01 reasonable set of things, we're dead." 51:03 >> Yeah. 51:04 >> And and so like we can either give up or 51:07 we can try and find a way to accomplish 51:09 an unreasonable set of things. 51:12 >> How do you manage them though? founders 51:13 are typically a little unruly, want a 51:16 crap ton of autonomy, often don't play 51:19 with that well with others. Like, how do 51:22 you manage the chaos? 51:23 >> I don't know if I've found that to be 51:25 the because like, you know, if you're if 51:27 you started a company, I mean, look, 51:29 there's all kinds of people, but like, 51:31 you know, man, like you've got to 51:33 convince a bunch of people to work for 51:34 you, you know, that you know, when it 51:37 doesn't make any sense, 51:38 >> you know, and like there's a certain 51:40 amount of 51:43 charisma or interpersonal skills that 51:45 you've had to like develop like even if 51:47 you didn't have it. I think that that 51:49 most people are more well socialized 51:52 than that. But there there always I 51:54 guess exceptions and and we do give 51:56 people a lot of autonomy because like 51:57 the best thing in the world for me is 51:59 someone who can run with something, you 52:02 know, and and and sort of take it off my 52:04 plate. Um like that's that's ideal. So 52:07 everyone everyone's aligned on there 52:09 being that kind of autonomy. 52:11 Just switching gears briefly 52:15 um deal your main competitor 52:20 been a lot of drama around it. 52:22 Do you want to talk about it? 52:24 >> Sure. Weirdly I would say deal is a 52:27 competitor but probably not the main 52:29 one. Um you know the the companies 52:32 >> you got a lot of them. Yeah, there's a 52:34 lot of, you know, if I was like, who's 52:35 our main competitor space? 52:37 >> I would be like, man, you know, in 52:38 payroll, it's probably 52:41 >> Paycom, Payloity, ADP, 52:44 >> you know, workday for HCM, maybe, you 52:47 know, gusto down market. 52:49 >> Yep. you know, we we come up against 52:52 deal in specifically this sort of global 52:55 part of the business where you're I need 52:57 to hire someone in XYZ country and I 53:00 have like one or two people that I'm 53:02 hiring there and I don't know anything 53:03 about it and need some help but like 53:04 that's where we compete with them. But 53:07 um 53:08 >> but we have you know much much stronger 53:11 competition with these other companies. 53:15 It's just that some weird stuff 53:17 happened. 53:18 >> Yeah. Yeah. With with them. 53:19 >> Tell me about it. So, when was the first 53:21 inkling you had 53:24 that there was a spy that that someone 53:28 was spying on someone from deal was 53:30 spying on your company? 53:31 >> The weird thing about spy is like spy 53:33 makes it sound 53:34 >> it's great. It's a podcast. 53:35 >> Sort of sexy and fun. 53:37 >> That's the idea part 53:38 >> which for podcast. Great. But I think 53:39 it's really like it's not the deal was 53:42 spy. It's that they were stealing. Yeah, 53:44 it was it was just theft pure and direct 53:47 from the CEO of the company. 53:49 >> Yeah, it's worse. 53:49 >> And the the the thing that happened is 53:52 we got a reporter who was writing a 53:54 story sent us a bunch of rippling 53:57 internal Slack messages that, you know, 53:59 many of which were sort of cropped in 54:01 sort of like unflattering ways and taken 54:03 out of context and was like asking for 54:05 our comment on it. And just you know 54:07 because of the context it was it was 54:10 very clear for a bunch of reasons when 54:12 you thought about it that the only place 54:13 that this could have come from like it 54:15 had to have been deal like no one else 54:17 would have sort of known to send this 54:19 stuff to that reporter and so the 54:21 implication was the deal had you know 54:24 full access to our slack. Um and then 54:28 from there, you know, we so we sort of 54:30 knew what was going on immediately. 54:31 >> But even before that, did you have an 54:33 inkling like in some territory that they 54:35 were winning an unusual number of deals 54:37 and like how are they doing it? Was 54:39 there an inkling before that? there 54:41 really, you know, once you started 54:43 looking, you know, there were these 54:45 examples. There were like when this 54:47 story came out, you know, there were 54:50 customers that wrote into us and former 54:52 customers, you know, there that that 54:53 wrote into us and there was there was a 54:55 guy that was a former deal customer that 54:58 took a demo with Ripley and was talking 55:01 with us, came to us because he wanted to 55:03 switch and he spoke with a Ripling 55:05 account executive and within hours he 55:09 got a WhatsApp message from Alex 55:12 Buouies, this CEO of Deal, you know, who 55:14 he didn't know, never met before. 55:16 that was like, "Hey, I hear you're like, 55:17 you know, looking at other stuff, like, 55:18 you know, let's try and find a way to 55:20 get you, you know, 55:20 >> seems like an awful big coincidence." 55:22 >> Yeah. And he emailed at the time, and 55:24 this was before we knew anything was 55:26 going on. 55:26 >> He emailed his rep. He was like, "Whoa, 55:29 this is super weird. Like, this freaked 55:31 the hell out of me like I you know, how 55:33 did how did deal know that?" Like, you 55:35 know, and of course the rep thought 55:37 nothing of it, so it didn't go anywhere, 55:38 right? um until later you look back and 55:40 you're like, "Oh yeah, you can actually 55:42 trace the person that who's a Ripling 55:44 employee that deal started paying to 55:47 send them all of this internal steel 55:51 rippling internal data including 55:54 mostly like CRM data just like every 55:57 opportunity we were working, every 55:59 customer we were talking to, the pricing 56:01 we were offering them, the objections 56:03 they had, 56:05 >> you know, it was just every single day 56:08 just sending all of it directly to Alex. 56:11 Do you think Alex and crew targeted 56:15 someone or took an employee and got them 56:18 to work for you or there was somebody 56:20 working for you that they got to? 56:23 >> They co-opted somebody. 56:24 >> And you know the thing is that hasn't 56:26 been talked about a lot is 56:29 >> it it really seems like it was you know 56:32 wasn't wasn't just us. There were a 56:34 bunch of other companies and so you know 56:36 there was sort of 56:36 >> that they were doing it too or in the 56:38 industry large is a lot of this going 56:40 on. No, no. That that deal was doing 56:42 this. 56:42 >> I see. 56:43 >> You know, like we were not the only 56:45 ones. [clears throat] 56:46 >> And and that 56:47 >> it was a defined play. 56:49 >> Yeah. This was I I I think I believe 56:51 that this that that company was built on 56:54 this foundation 56:56 of theft from competitors 56:59 >> and that that was like a critical 57:01 component of what they're doing. And so, 57:03 you know, one of the things that we 57:05 decided to do is we decided to be 57:07 extremely public about this and come 57:10 forward. 57:10 >> Hold on. Even before that, so you get 57:12 this thing from your press guy like they 57:15 have to have access to our Slack. 57:18 >> Yeah. 57:18 >> And then you ran a honeypot operation to 57:22 kind of prove what you thought. Can you 57:24 just talk about that meeting and what 57:26 was going on? Can you just give us a 57:28 glimpse behind the scenes of what 57:30 happened in that meeting? Well, so 57:32 actually first before that, okay, 57:34 >> what happened is we needed to figure out 57:36 like who was doing this. 57:39 >> And I my assumption was that this was 57:43 probably 57:44 a former employee that left, you know, 57:48 because sometimes people leave one 57:49 company, they go to another. Yep. 57:51 >> And sometimes people like, you shouldn't 57:52 do this. It's wrong. It's legal. But 57:55 sometimes it happens that people take 57:56 some stuff on the way out. Y. And so I 57:58 was like, maybe there's someone who kind 58:00 of like, you know, did did their new 58:03 employer a favor on the way and sort of 58:05 unethically y 58:07 >> instead of, you know, what what we would 58:09 do in a situation like that is we would 58:10 say, whoa, whoa, whoa, like don't, you 58:12 know, delete that. We don't want, you 58:14 know, and and unethically they said 58:17 goody, you know, like great. And then 58:18 what we did is, you know, the the the 58:21 sort of light signature of of the 58:23 behavior that really popped up was the 58:26 search history in Slack. like what you 58:28 know there were certain searches that 58:30 this person had to have been doing. 58:31 >> So did you invite your IT guy in like 58:34 how how did it 58:35 >> well so this is the crazy thing is the 58:37 search logs in Slack are not visible to 58:42 Slack clients. Oh, you ping Salesforce 58:44 >> and so and in fact like cynically I 58:47 think they were doing it in this way 58:49 precisely to avoid detection is they 58:51 were doing searches and then getting 58:53 things from not joining the channels but 58:55 getting things from the preview from the 58:56 search from the actual searches and so 58:59 really the only way we were able to do 59:00 this is we got introduced to some like 59:04 very senior people at Salesforce who 59:07 like to their credit you know sort of 59:09 agreed to help us track this down and 59:10 they they pulled from their own internal 59:13 logs, 59:14 >> what the search history was, and it was 59:16 very clear exactly who the person was, 59:18 and that person was still an active 59:20 Ripling employee. 59:21 >> Who was the one who came up with the 59:22 idea to look at that particular thing 59:25 >> to look at the searches? 59:27 >> Yes. 59:28 >> I can't even remember, but it it was so 59:29 obvious. It was like 59:30 >> you called a meeting of a bunch of smart 59:32 people and like how are we going to 59:33 catch them? 59:33 >> It was like I mean it was a very small 59:35 team. It was like, you know, it was 59:36 like, you know, me, my my general 59:39 counsel, like, you know, the deputy GC, 59:42 you know, it was like a it was like two 59:44 or three people on legal, two or three 59:45 people in security, and it was like, 59:48 hey, 59:48 >> how are we going to catch them? 59:49 >> You know, to to get this the Slacks that 59:52 we saw, they must have done these 59:54 searches to get, you know, so we and 59:56 these are weird searches like someone 59:58 and so we've got to be able to find 60:00 this. And so then we we we clearly 60:02 there's one person that was like doing 60:03 this and it was very clear who it was. 60:06 The big kind of insight was like well 60:08 look it's actually cuz we were thinking 60:10 like is there something that we could do 60:12 where we could put something in Slack 60:15 you know like maybe like put like a fake 60:18 customer in Salesforce with a phone 60:20 number that like goes to our law firm 60:22 put that in Slack and like see if a deal 60:24 sales rep calls that phone number you 60:26 know and like kind of triangulate that 60:28 way. And it was just it was too hard to 60:30 sort of know like cuz we it was too hard 60:33 to see what deal would be doing with it. 60:36 And so the insight was realizing that 60:39 you could flip it around and you could 60:41 actually the thing that we could see was 60:43 the searches and so we could see what 60:45 this guy was searching for and so we had 60:48 to do it the other way. We had to give 60:50 some information to deal and see uh this 60:54 guy searched for it. 60:55 >> How did you get the information to deal? 60:57 So, [clears throat] you know, look, a 60:58 lot of companies that are in competing 61:01 spaces have some somewhat regular 61:04 exchange of like legal letters where, 61:07 you know, for whatever reason, you know, 61:10 they send you a letter and they're like, 61:11 "We're angry that this person joined and 61:14 make sure that they're, you know, or 61:16 this person recruited someone they 61:17 weren't supposed to recruit and, you 61:18 know, and so this is a sort of fairly 61:20 form, there's a sort of low level of 61:22 that that was kind of happening." And so 61:23 there happened to have been a letter 61:25 that they had sent us about something or 61:27 other related to a deal employee that 61:29 had joined Riplane that we had, you 61:32 know, sort of I think at the time had 61:34 decided we're not even going to bother 61:35 responding to this. But we suddenly 61:37 said, well, let's respond to it. And 61:39 when we responded to it and we said, 61:40 "Okay, we decided to put together like a 61:44 screenshot of a a Slack message." Um, 61:48 that was like basically like a a fake 61:51 Slack message. Although to make sure 61:52 that it wasn't actually fake, we 61:54 actually had someone send that Slack 61:56 message so we could we could be like, 61:58 "No, no, it was a real Slack message." 61:59 But but we put this thing together and 62:02 the Slack message what's actually the 62:04 funniest part of this is that initially 62:07 this was designed by the legal team and 62:10 man the Slack message was so boring. It 62:12 was it was like 62:13 >> no one would have cared. It was so 62:14 uninteresting 62:16 >> and so and this was a very you know 62:18 closed circle of like you weren't 62:20 allowed to tell anyone about what was 62:21 going on. And so I called up our former 62:25 CMO um who was like uh that he had moved 62:29 into a new role at Ripane. Uh but he was 62:31 like one of the things about him that's 62:33 so amazing is he's like just great at 62:36 writing coming up with like cold email 62:39 messages. And so he was always the guy 62:40 we went to when we needed like a new 62:42 cold email to send people that was and 62:45 so I called up Mebstein and I said, 62:48 "Mebbstein, we need you to write a cold 62:50 email that's going to have a 100% S1 to 62:53 S2 conversion rate that like like 62:56 definitely someone's going to have to 62:57 click on this." Yeah. 62:58 >> And he came up with the actual thing and 63:01 it was this message that sort of 63:02 suggested that there was this channel in 63:05 rippling Slack called DD defectors 63:07 >> where ex deal employees were talking 63:10 about deal maybe in ways that were 63:11 unflattering and there were you know we 63:14 sent them the message and then just for 63:15 added sort of theatrical effect we like 63:18 blacked out like key parts of it you 63:20 know to just be like really be like what 63:22 are the blacked out parts of it and and 63:24 it was included in this letter that we 63:27 sent to um their CFO who is you know the 63:31 CEO's father um and their outside 63:35 counsel um and their head of of legal 63:38 [snorts] the sort of person's title. So 63:40 there's only three people. One of them, 63:42 you know, presumably it's not the 63:44 outside council. And then the other two 63:45 are quite senior within the company. And 63:48 we sent them this letter, you know, at 63:50 like I think it was like 8:00 p.m. And 63:52 then we waited. And I remember waking up 63:55 at like 4 in the morning and checking my 63:58 Slack and and there was just all these 64:00 messages. It was like, "Holy [ __ ] they 64:02 did it." And like we were getting 64:04 >> somebody was searching on that channel. 64:06 He was searching and going in, you know, 64:09 this going into this channel and like, 64:10 you know, it's a it was purposefully a 64:12 weird search term. It never been 64:14 searched before. We checked, you know, 64:16 it was not a real channel, you know, so 64:18 there's only one way that this could 64:19 have happened. 64:20 >> Okay, now you know who it is. Your month 64:22 and a half search is over. 64:24 >> Then what happened? 64:26 >> Well, then you know 64:27 >> who approached him. 64:28 >> So this the the employee was was based 64:31 in Ireland. Yes. And Ireland has um the 64:36 Irish legal system has an extraordinary 64:38 form of relief in civil litigation that 64:42 allows you to file an exparte process. 64:44 So basically you can you don't have to 64:46 alert the other side. You can go to 64:48 court and get without the other side 64:50 being aware of it an order from the 64:52 court that's effectively sort of like a 64:54 warrant. You know in the US legal system 64:57 that exists in like a criminal case but 64:59 not in civil litigation. 65:01 Um, and so we we were able to get this 65:04 because of the sort of strength of the 65:06 evidence that sort of there was a court 65:08 order to get access to this guy's phone 65:10 and and so there was a court officer 65:14 that came to 65:15 >> police officerish person. 65:17 >> I don't know about police officer but 65:19 court officer. It was like a solicitor 65:22 is the uniform. 65:23 >> I actually don't know. But but in in in 65:25 the Irish legal system there solicitors 65:28 and barristers and you know and so maybe 65:31 more like a lawyer 65:32 >> wearing a white wig or 65:34 >> man I don't even know now. I'm going to 65:36 look that up. But anyway, you know they 65:38 showed up at the office met this guy was 65:40 take you know sort of you know went into 65:43 a room for a meeting and there was this 65:45 team array with you know sort of 65:47 forensic IT people. sort of officer of 65:49 the court said, "Look, I've got this 65:51 order for your phone." And um he uh sort 65:55 of said, "I don't have my phone with me. 65:56 I need to go get it." That turned out 65:58 not to be true. Um and then he sort of 66:02 while he was like going to get it, kind 66:03 of ran into a bathroom and locked 66:05 himself in the bathroom. And what we 66:07 later learned is that in the bathroom, 66:08 he did a factory reset on his phone, 66:10 tried to flush it down the toilet, 66:12 >> and then came out of the the bathroom. 66:15 And you know, the the court officer was 66:17 telling him, "Look, you're violating the 66:18 court order. There's, you know, this is 66:20 something that you can be in prison 66:21 for." And he ran out of the building and 66:24 took off. Yep. And then you know over 66:26 the next sort of 10 to 12 days there was 66:31 this sort of b sort of ongoing legal 66:33 process to try and get you know sort of 66:36 like real like police enforcement of 66:39 this to get this guy to get a lawyer to 66:42 sort of and you know get like contempt 66:44 charges filed. And eventually what 66:46 happened is is he um you know sort of 66:51 facing you know sort of these legal 66:53 consequences. 66:55 He eventually sort of like turned and 66:58 sort of started cooperating 67:00 >> and said that he had destroyed his 67:02 phone. But he also um he told us and 67:04 this is all you know in the sort of the 67:07 sort of court proceedings and the 67:08 affidavit that he produced. But 67:10 according to these proceedings, you 67:12 know, allegedly what happened is that he 67:15 immediately after he left our office, he 67:17 got u called Alex, the CEO of Deal, told 67:22 him what had happened. Alex said someone 67:24 would reach out to him, you know, 67:25 allegedly and and and then two attorneys 67:29 at Deal, like stab like employees of 67:32 Deal who were attorneys called him back 67:36 and they they told him to destroy his 67:38 phone. Um, which is like if you're 67:40 that's a that's a bad thing for anyone, 67:42 but it's really bad for attorneys to be 67:45 to be saying that. um um told him 67:48 destroy his phone, get a new burner 67:50 phone, um call them back, delete all of 67:53 his accounts, and they offered to 67:55 relocate him and his family to Dubai um 67:59 and get him out of the country. Dubai is 68:02 >> no extradition, 68:03 >> you know, like not a lot of extradition 68:05 options. One of those lawyers, by the 68:08 way, who was based in the UK, practiced 68:10 law in the UK, has since relocated to 68:13 Dubai himself since this all came out. 68:16 And so there was and so there was this 68:18 crazy thing where he detailed, you know, 68:19 like the the person who was doing this 68:21 detailed ex everything that happened and 68:23 how he was recruited by the CEO directly 68:26 and sent all of this information to the 68:28 CEO and was paid, how he was paid um and 68:31 and all all you know, sort of all of 68:33 this stuff. Do you think this is going 68:36 on a lot in tech? 68:38 >> I don't think it's going on a lot. And 68:41 uh look, I think the reason that we 68:43 really came forward with this, 68:45 >> yeah, you went very public. You know, 68:47 obviously there's a reason for rippling 68:49 that, you know, for the business, we 68:50 need to defend the business. But, you 68:52 know, more importantly, I do think that 68:54 if deal 68:57 sort of moves forward like in a way 68:59 that's unscathed, 69:00 there is this risk that the overton 69:03 window shifts and that this becomes 69:07 a norm. You know, that it's sort of like 69:09 ah, you know, 69:10 >> your competitor paid someone to steal 69:13 your CRM data. If you can't stand the 69:15 heat, get out of the kitchen. Yeah. You 69:17 got to be doing the same thing. And 69:19 everyone 69:19 >> set a precedent. 69:20 >> And everyone's got to have an espionage 69:22 team and a counter espionage team and 69:24 and and I just don't think that that's 69:26 the that's not the way I want the world 69:28 to work. 69:29 >> Mhm. Okay. Anything else you want to 69:32 tell the audience? Any other advice you 69:34 would give to founders and people who 69:36 want to go from four people to 40 to 400 69:40 to 4,000 and 40,000 someday? I think 69:43 like everyone kind of needs to find 69:45 their own path through this stuff. It's 69:46 one of the things that's that's kind of 69:47 hardest. Like I don't I don't really 69:49 think that there are a lot of rules and 69:51 recipes. And so, um, you know, it's why, 69:55 um, I probably have like a lot a lot 69:58 more, you know, I there was a a point in 70:01 in my life when I was like very angry at 70:03 investors and and I think I've sort of 70:05 sort of reached some point where I 70:07 actually have a lot of empathy for 70:09 investors and like how hard it is to be 70:11 in in their position and and how 70:14 impossible the job is. Um and uh because 70:18 I think it's really hard, you know, even 70:19 if you have a lot of experience 70:21 yourself, 70:23 you know, there like people all find 70:25 their own paths and things change. Like 70:28 Ripling was like a business that was 70:31 like so close to what we were building 70:34 at benefits like it wasn't was the same 70:36 industry 70:37 slight slightly tinkered with kind of 70:40 the the sort of principle kind of the 70:43 foundational principles of sort of what 70:44 we were building but like the world was 70:47 like like four years into the future 70:51 from when I had started ZS and that one 70:54 thing like changed everything. It was 70:56 like, you know, all of the things that, 70:59 you know, or many of the things that had 71:00 worked for us at Zenovs didn't work at 71:02 Riplane and and like, you know, just 71:04 like like everything was different 71:05 because of a few changes to the starting 71:08 assumptions. And it really 71:10 >> sort of made me realize why so much of 71:13 the advice that people give out about 71:15 how to do this is so useless because 71:17 everyone is fighting yesterday's war. M 71:21 >> um you know from their own experience 71:23 and like 71:24 >> things are very different you know 71:26 things have changed just because of the 71:27 slow advance of time 71:29 >> if not because this is a completely 71:31 different business in a completely a 71:33 different industry with a totally 71:34 different set of people. 71:35 >> Um so it's it's a real struggle. Um, and 71:38 it it's probably one of the reasons why 71:41 I'm like, man, it sucks. If you have any 71:43 other any other thing that you can go 71:45 do, like maybe that's the right thing to 71:47 do instead of instead of getting 71:48 involved in this whole thing. 71:50 >> I appreciate you. Thank you on behalf of 71:52 the listeners. You're an inspiration to 71:54 many. Congrats on all your success. 71:56 Congrats on your revenge tour. 71:58 >> Well, thank you very much. 71:59 >> Appreciate you. 72:01 >> Okay. Hope you like that interview with 72:03 Parker. I really liked it. He's a smart 72:05 guy on hiring. He's got a bunch of cool 72:08 ideas. Uh, some of which I'm definitely 72:10 going to borrow. I like his idea that if 72:12 he's got a candidate that's coming to 72:14 meet him, he sends them an old board 72:16 deck or his investor memo, lets them 72:19 read it, and he spends like the first 72:21 half of the interview just talking about 72:23 that. And the reaction of the candidate 72:25 to that memo and the ideas they come up 72:27 with really says a lot about them. I 72:29 love that he does that. He relies a lot 72:32 on on reference checks. He does 72:34 something interesting there. He asks the 72:36 candidate to give him six references, 72:39 which is kind of a lot, and he only 72:41 calls two. He's trying to figure out if 72:42 they have six references or not. But 72:44 then he leans much more heavily on the 72:47 blind references. And this is something 72:48 I did as well. I would say 60% of my 72:52 decision criteria was around the the 72:55 third party references of people who 72:56 used to work for them. So, I thought 72:57 that was interesting. This is something 72:59 we didn't do at HubSpot, but I really 73:01 liked how he hires a lot of ex-founders. 73:04 And he talked about how ex-founders are 73:07 used to breaking the laws of physics. 73:10 They're used to just really tight 73:12 constraints and having to really do hard 73:14 things. And so he has them sprinkled 73:16 throughout his or he's had a lot of 73:18 success with them. He likes his senior 73:20 team to be a mix of homegrown talent and 73:23 been there, done that talent. And this 73:25 is pretty consistent across most of the 73:28 CEOs I interviewed. And I feel like it's 73:30 a little bit of conventional wisdom and 73:32 scale up land that you just hire a bunch 73:34 of been there done that people. I'm not 73:37 sure that's right. A lot of HubSpot's 73:39 team over the years was 50% homegrown 73:41 and 50% been there, done that. And that 73:43 mix I think is just about right. I took 73:46 some things away from on pace. He's at 73:49 4,000 people. A lot of companies slow 73:52 down when you hit 4,000 people. He seems 73:55 to be keeping the pace up. And he does a 73:58 few things that I think are smart. And a 74:00 lot of the CEOs I interviewed do a 74:02 couple of these things. First, he really 74:04 tries to stay on the coal face with the 74:07 customer. He's one of the most active 74:09 users of Ripling, the product. He runs 74:11 payroll for all 4,000 employees in 74:13 Ripling. So, he stays very close to the 74:14 customer experience through that. He 74:16 stays on the coal face with the 74:18 employees, too. He sits right inside the 74:21 engineering organization where he can 74:23 see what's going on, hear what's going 74:24 on. And he talked about the CEO sets the 74:26 pace. CEO slows down, the or slows down. 74:29 CEO speeds up, the or speeds up. One of 74:31 my big takeaways on Parker is he doesn't 74:34 have a chip on his shoulder. He's got a 74:36 boulder on his shoulder. And that 74:39 boulder really drives him. He calls it 74:41 his revenge tour, the whole company. I 74:43 think this is pretty common amongst some 74:45 of the best CEOs and can be a real 74:48 motivator. And in his case, David Saxs 74:50 put a boulder on his shoulder. I have a 74:52 chip on my shoulder and I had an old 74:54 boss put it there. I had a guy work for 74:56 for a decade. When I went to resign, he 74:59 said, "You'll be nothing without me." 75:02 And this is like 30 years ago and I 75:03 still remember. And if I really want to 75:05 get fired up, I think about the day I 75:07 resigned from that company. So Boulder 75:09 on the shoulder, super useful. Channel 75:12 it. Uh I think it can be really useful 75:14 for you. My last thought on Parker and 75:16 about scale up startup land rit large. I 75:19 meet with lots and lots of founders 75:21 these days. There's a new breed of 75:23 founder I call five tool founders. Now a 75:26 great baseball player can hit, can hit 75:28 with power, can catch, can run and throw 75:32 all at an elite level. And I'm noticing 75:34 a new breed of founder who is kind of 75:36 like that. And I think Parker's one of 75:39 them. I think Brett from Sierra is one 75:41 of them. Mati from 11 Labs. Gabe from 75:44 Rogo. Darra from Deli where they're very 75:47 good at coding. They're very good at 75:51 design. They have vision. They can 75:53 recruit and they can sell. Those are all 75:56 five tools that they have in their bag. 75:58 And I'm noticing more and more of them. 76:00 And if you're one of those founders 76:02 that's deeply technical like them, but 76:04 can't quite storytell and sell, I would 76:07 work on that and [music] get some 76:09 coaching on that and get some feedback 76:10 on it because those five tool players 76:13 are worth their weight and gold. And if 76:15 you can be a five tool player, that 76:17 really opens up a lot of doors for you. 76:18 Okay, those are my thoughts. Lots of 76:20 takeaways from Parker. I'll see you on 76:22 the next episode. 76:27 >> [music]