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SPEAKER_03: Hey, everybody.

SPEAKER_04: Welcome to This Week in Startups. Amazing guest today. He's been on the pod, but not in almost a decade. He first appeared on episode 224 back in January of 2012. Wow, 224? 224, yeah. Yeah, you're early.

SPEAKER_07: That was a great cohort, I think, right? Yeah.

SPEAKER_04: Great episode. Episode 389 back in October of 2013, and then he put his head down, took his company public, and started tweeting full-time on a comedic basis.

SPEAKER_09: What number are we at now?

SPEAKER_04: I think this will be 1,200-ish. We're at 1,150 or something, so you do something two times a week for a decade, it kind of adds up real quick. You guessed it, Aaron Levy is here. You can follow him on the Twitter, L-E-V-I-E, where he, according to sources, has a team of comedy writers at Box headquarters. You've been doing jokes. You were like the first guy who's high profile to just say, you know what, fuck it, I'm going to just tell jokes with my SaaS company. My go-to market strategy on social is going to be to just tell funny jokes. Take us into, when did you come up with this idea?

SPEAKER_13: Was it your idea? Was it your comms people? It seems like something a comms person begged you not to do.

SPEAKER_15: Yeah, you know, there's typically two go-to-market strategies in enterprise software.

SPEAKER_18: There's the bottom-up, kind of, like, adopt, land, and expand premium, and David Sachs, obviously, you know, one of the contemporaries on that front, and then there's the tops-down sales motion. And so our innovation was, yeah, Twitter jokes as the third option to get customers.

SPEAKER_20: A third way.

SPEAKER_18: Nobody had thought about that before, and we figured it was a blue ocean that we could go in and, you know, change some of the sort of market criteria and pull it off.

SPEAKER_23: Basically, yeah, a third way, and boy, has nobody followed you down that path.

SPEAKER_04: There's nobody doing structured jokes on Twitter as a marketing channel.

SPEAKER_18: It's too expensive. As you noted, the team that you need, it's way easier just to hire salespeople. So, unfortunately, it does take a lot of VC dollars up front if you're going to pull it off.

SPEAKER_31: Yeah, I mean, if you think about it, just given the boom of Disney and Netflix to compete

SPEAKER_32: for comedy, it's just a hard, it's hard. Those employees are hard. They're kind of like AI and self-driving employees. Like, the comedic social media writers are just hard to come by.

SPEAKER_16: You're competing with Netflix specials. They get, you know, bought out for millions of dollars, and so just to have them do enterprise

SPEAKER_37: software jokes is, uh, it's, it's, uh, not a lot of levers there.

SPEAKER_36: All right. Now, be honest.

SPEAKER_32: It can't be that you're able to do a half dozen just spot on jokes a day.

SPEAKER_39: That's not even statistically even in the same universe of, uh, it's like every two days,

SPEAKER_41: there's one tweet. So, and, and my last tweet was about data migration services in the cloud. So, you know, I think, uh, I think we're, we're, we've calmed it down a little bit. Yeah.

SPEAKER_44: Uh, but it did, you, you wrote them or do you have somebody on the team who workshops it with you?

SPEAKER_16: I, I, you know, the thing I struggle with is like, I don't see it as that cool. Um, and so like, I always, I like, I mean, it's just, these are just tweets and they're, I, I, you know, it's just stuff going on on the internet. And so you tweet about it.

SPEAKER_46: It's pretty great. Um, so you started box over a decade ago now, if I, if I'm about correct.

SPEAKER_50: Yeah. We're, we're, we're now actually about a decade and a half.

SPEAKER_51: Is it 15 years? You started 2006 or seven.

SPEAKER_52: You were a, a mere blog entrepreneur, uh, back in those days.

SPEAKER_46: That's true. That's true. I was not a podcast entrepreneur. I am today.

SPEAKER_54: I have made no progress, but you're, you're, you, you move with the medium, so it's, it's good. Absolutely.

SPEAKER_46: And yes. And for the next decade, I've dedicated myself to casual audio spaces, something else completely meaningless.

SPEAKER_16: What's your big thing? You're, you're now doing, um, you're doing big reveals on coaching clubhouses. Is that the, is that the new, uh, new niche that you found?

SPEAKER_04: Um, you know, I always hated you remember back in the day when you and I started, uh, if you wanted to present your company and you were startup, you were told to go to demo demo was like, Hey, wow, Aaron, this is incredible. Uh, give us $20,000. We'll give you three minutes on stage. And if your computer windows, computer crashes, we're going to laugh at you. Um, and you don't get the minutes back. And by the way, you have to hire a coach for $4,000. Here's our coach. It was, it was madness, right? It was like 20, 30 grand to present your company. Yeah. Um, and so we killed that with our conferences. And then last night I was just, every night I go on clubhouse, I see a whole group of people trying to sell services and they've got eight figures, nine figures, they've started 300 businesses. So I just went into the room and I was like, so I see you've started many seven, eight and nine figure businesses. Can you tell me which one is objectively the most successful and that you're most proud of? So they booted me out of the room.

SPEAKER_65: Yeah, no, totally. That's, that's not going to make any friends in that coaching clubhouse.

SPEAKER_04: So, no. So I'm, I'm, I started a room last night where we workshopped new coaching offerings. And the best one is that somebody came up with is they're starting a coaching class to teach you how to take coaching classes.

SPEAKER_67: Okay.

SPEAKER_04: So, cause you know, if you're going to spend $10,000 being coached, you really want to get

SPEAKER_32: the most out of it. So spend $8,000 in this coaching class and it's a multiplier, you know what I'm saying?

SPEAKER_72: I, I, well, you, you, you need to be primed for coaching. So, yeah.

SPEAKER_32: You ever go to that, you go to that Tony Robbins stuff or whatever. I know a lot of our contemporaries, we see them like sharing pictures on Instagram.

SPEAKER_23: You ever go to that Tony Robbins or anything like that? Are you part of that?

SPEAKER_75: Are you, is that a question?

SPEAKER_23: Yeah.

SPEAKER_75: No, no, no. I, I, I stick to books. So.

SPEAKER_76: You like to read the books.

SPEAKER_16: I, I'm, I like to read the books and I do occasionally you'll find me on like YouTube at 1am watching some, you know, strategy keynote or something. But I, I, I haven't gotten sucked into the coaching vortex, but the, actually I will say it, um, my, um, uh, I do have a vice, which is, um, which is, I, I, I spent about 30 minutes on a clubhouse a couple of weeks ago where they were doing domain auctions and, and that was, that was actually exciting. Like that would, if I, if I, you know, wasn't at box, I would be spending way too much time in domain auction clubhouses. Um, so what did you pick up?

SPEAKER_32: Did you pick up a couple of.nets, a.org, any, uh, numbers?

SPEAKER_16: They were just doing the, the dot club TLD. So, um, it was really interesting.

SPEAKER_79: So they went on clubhouse to sell dot clubs.

SPEAKER_18: I, I don't know if that was sort of, you know, purposeful, but obviously too uncanny for that not to be purposeful, but it was great because they, you know, a couple of these people actually had some really good dot clubs, you know, going for a hundred bucks or whatever. So.

SPEAKER_82: So did you get SAS club? Cause that would be the most boring club in the world.

SPEAKER_16: I didn't want to, uh, didn't want to go in on it at this point. I need to see if it's actually going to be a, a high growth TLD box.

SPEAKER_83: When public, when exactly about five years ago, about five years ago.

SPEAKER_04: Now you went public at the exact time everybody was being told to stay private longer. Yeah. And then here we are five years later and now it's actually, I'm sorry. It's just, everybody's going through a spectacular, you know, go public. It doesn't matter if your products launch. I mean, they're, they're looking, they're so desperate for inventory to SPAC. They found like failed car companies like Fisker to like, bring them back from the dead and Frank and SPAC them. So what were you, what, what led you to go public at that time when they were telling, you know, Travis and, you know, uh, Airbnb, like, don't go public, don't go public, keep focusing, you know, stay private longer. And then how did you come to that decision?

SPEAKER_34: Um, there was a few factors that, that led to our decision. Um, and actually I think these are, are pretty germane to enterprise software in general, which

SPEAKER_18: is, um, at a certain revenue scale, let's say a hundred million in recurring revenue, 200 million recurring revenue, you, you have enough predictability, uh, predictability in the business model where, um, you can, you know, operate at scale as a public company, I think with a high degree of forward looking, you know, kind of visibility and predictability and so that's good because that's sort of like job number one of going public is, is really make sure that you've got the business model locked in. Number two, we felt like we had a really strong leadership team in place. So the leadership team that we felt like could double or triple or quadruple our revenue. And, um, ultimately we've, we've grown revenue by three or four X since, since going public. So that, that part was, was definitely locked in.

SPEAKER_41: Um, and then the third thing in particular in enterprise software, um, there's this one idiosyncrasy where your customers actually want to literally know like, how are your financials doing? Are you going to be able to manage my data for the long run? And so there's almost a kind of credibility brand transparency element to being public that ends up being uniquely helpful in enterprise software. That's not really the case in, in consumer like Airbnb or DoorDash doesn't really matter if these companies are public or private from my, um, kind of consumer, um, uh, use cases. So, so those three things happen to align in kind of the 2014, 2015 time period.

SPEAKER_91: And that was ultimately why we decided to go public, but, um, uh, it was, yeah, it was definitely a journey and, and, but we felt, you know, we felt prepared at the time.

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SPEAKER_93: Did people tell you you're going out too early and you just said, I want to do it anyway. What was the like back and forth? Because there's certainly, you made the decision.

SPEAKER_04: You looked at, you have the team. You think you can hit the revenue targets. And yeah, it is a great point. Like if you're going to be storing people's data and you're going to be involved and be a custodian of that stuff, yeah. Being public and financially sound is important. What was the, what were there people who were arguing with you to stay private longer? And what was their argument and why did you eventually decide, yeah, I'm going to go out

SPEAKER_102: anyway?

SPEAKER_103: Yeah, I think we had already been running the business probably at that point for kind of eight years when we started working on the filing.

SPEAKER_18: So it wasn't, it wasn't like that early in the journey, you know, relative to especially even the IPOs that you're seeing today, which feel kind of somewhat soon. So, so it really actually just felt like the right time. I think the, my one sort of side tangential opinion on SPACs is, and I think it's a, I think it's a really kind of creative model. Um, so there's no question that there's some really interesting sort of creativity to this financial model that creates yet another way where whether you do private equity, you do a traditional IPO, you do a SPAC, you do direct listing. I think it's great to have kind of, you know, a diverse set of options in, um, uh, in ways of, of, of being able to have your capital structure and, and, um, and be able to go public or go private. So I think that's all great. I think the, from the, and I think there are folks, uh, let's say like the Chamas of the

SPEAKER_105: world that I think do a really good job, probably detecting good business models. Um, because they're just, uh, you know, they're a, uh, early stage, late stage investor that

SPEAKER_18: just understands, you know, how software works and can bet on the right kind of ideas. So I think that all makes sense.

SPEAKER_41: I think the one risk is if you take this too far where people start to think about this, oh, this is actually, um, going to make me go public sooner or go public faster or an easier way of going public. I think that's a, um, a miscalculation, um, by both, you know, companies and entrepreneurs, because the going public part of the, uh, being public is not the hard part. It's the being public part. And so, so, you know, shaving off three months or six months of the IPO process is really, really the, the, the, like not the high order bit of, um, of, of the, the, the challenges of being public. I mean, the challenge of being public is you are on the clock every single quarter. You have an incredible amount of scrutiny. You have, it's no longer the days of three or five or 10 investors that you send a board email update to, and everybody's happy because they're illiquid. So they can't do anything about it anyway. It's a very, very different model when you're a public company. And so, so the only thing I, I guess maybe I'm a little bit, um, skeptical of is, is, um, is if we start to think about this as, well, it's a, it's a way easier way to, to be able to go public. And then thus people sort of thresholds for what it takes to go public, go down. And then we see the wrong kinds of companies going public because of that. I'm, I have no sort of opinion that we've reached that point or not, other than just like, you know, this idea that you're going to sort of spec anything, um, is, is, you know, can lead to the kind of bubble dynamics. I think we saw in the, in the late nineties, where, where, again, um, you just start to see things that, that go public that, that really don't have a place to be public. Well, I don't think we're seeing that yet.

SPEAKER_23: Um, I think the risk is, we've got a couple, I would say, I mean, to your point, yeah, it's not the majority.

SPEAKER_41: Yeah. I would just say like, I'm just watching the exponential curve of the number of specs getting created. So the current companies that are going, that are being backed, no opinion about, I think if you just look at the curve of the number of specs being created, then it starts to be like, huh, I wonder if, uh, how this is going to actually end, um, uh, at the end of this. But, uh, I, I think also there's, there's an equal and a counter argument, which is, you know, there's, there's hundreds of very, very viable, good companies that, that are probably going to be going public in the next couple of years. And so if this becomes a vehicle, um, for those companies to go public in, then, you know,

SPEAKER_91: nothing has really changed from what we had previously.

SPEAKER_114: Yeah. We have half the number of public companies or so, and we have 500 unicorns and then three or 400, I think SPACs are sitting there waiting, but yeah, there is an inventory issue where I think, like I mentioned the frack and frank and SPACs, um, I can say this, you can, but you

SPEAKER_04: know, you, I mean, Fisker was a company that failed already. I mean, a really terrible car that everybody who bought seemingly hated and one of my friends returned it because it was such a piece of garbage. And then they're like, let's make his company worth 6 billion again. And they don't even have a product in market. It makes no sense. And then you saw Nicola go public without a product in market. So it's almost like they took private investing and they made it a public pursuit. And that made, that's the one thing that's making me a little nervous is that maybe people are thinking, well, because it's a public company and the stock is going up.

SPEAKER_117: That means the business is growing and it's like, Hmm, that means does not mean that.

SPEAKER_41: I think that's a little bit, uh, definitely dangerous, especially, um, and then you mix that, um, with, with some of the risks of some of these sort of social viral. Investing dynamics.

SPEAKER_18: And then the question is, do, do we lose some of the, the, maybe, um, uh, and I, I, I can

SPEAKER_41: instantly sort of provide the counter argument, but do we lose some of the, the, um, uh, natural, uh, like the things that the bureaucracy prevents, I eat really, really bad companies from being out there and tradable, um, uh, goes away.

SPEAKER_18: And now you, you end up, you know, having, let's say retail investors, um, that have to judge, you know, what these businesses in a way that, that, you know, previously at least you had Morgan Stanley saying, okay, this is a vetted, you know, business and there's so many flaws with everything I just said. So, um, in terms of like, we also, you know, want to be able to have more distributed ways of investing and judging companies. Um, but at the same time, I don't think we want to necessarily dramatically lower the bar of the kind of companies that, that go public.

SPEAKER_13: It's definitely going to be a lesson for everybody. Cause if you look at, I don't know how quick, how closely you followed the IC O craze, but

SPEAKER_123: there were a lot of people who looked at your business or Dropbox or Uber or whatever it

SPEAKER_04: happens to be and said, Oh, if we take box and we put it on the public blockchain on an immutable ledger, everybody's files could be on an immutable ledger and it will be totally sustainable and transparent. I'm like, people don't want their files public and immutable ledger is dumb and slow and inefficient. As far as databases go distributed is unnecessary. You would rather have a central authority who's responsible for these documents. This is the stupidest thing I've ever seen in my goddamn life.

SPEAKER_123: Like, and by the way, there's seven spelling errors in the first three paragraphs of your white paper and just throw these people out of my office.

SPEAKER_18: The best one was, was sort of the Airbnb on the blockchain.

SPEAKER_41: It's like, no, no, like the whole point is you need some organization you can go to when there's a problem with the stay and, and, and then they're like, well, the market will solve that. And it's like, yeah, it's called Airbnb.

SPEAKER_127: So putting the fact that you stayed at this ski and ski out in Tahoe on the blockchain

SPEAKER_126: does nothing. Like literally zero. And what do you think there, there is a company and a hundred years from that, I might want

SPEAKER_129: to be able to actually, you know, pull that up and prove that it happened.

SPEAKER_126: Yeah. For what reason? Like, do you do that?

SPEAKER_32: Sometimes you look at your entire digital footprint and you're like, Oh my God, I have to make sure I know what to do with this after I die. And then you realize, no, nobody cares.

SPEAKER_133: These are the new things you'll pass down to your grandchildren. You're going to pass down hashes and, um, and like logins to, uh, you know, tokens.

SPEAKER_135: So that, that is the new grandfather clock.

SPEAKER_23: Yeah. Would you be interested in the places your grandfather went in his four square account?

SPEAKER_04: Hmm. I'm thinking this through.

SPEAKER_137: That's actually kind of interesting.

SPEAKER_16: Yeah. Well, I was going to say like, like if, I mean, that's no different than the passport, you know, that, that you got handed down from world war two. And, um, so that's kind of cool.

SPEAKER_140: Yeah. Here's what my grandfather's one would look like. He went to the firehouse. He went to the pub.

SPEAKER_142: He went to the firehouse and back to McSorley's and then back to the firehouse. And that was one shift.

SPEAKER_16: Like, but now the great thing is it's also all on video and you get to watch, you can relive all those moments. So it's amazing.

SPEAKER_51: Yeah. Interestingly, William Gibson in, you ever read any of his work when you give sin.

SPEAKER_04: So he did a really cool series. I think it was called, I can't remember it Doru, maybe in the bridge series, but his idea was like the Bay bridge had been, the world goes crazy as dystopian. Bay bridge has been like knocked down on either side, but there's like the middle stanchion still there. And then that's become an outpost and people like live on it among other things. But one of the things was everybody had God's little computer following them, which was a little Zeppelin like a drone with a camera on it. And a hundred percent of your life was recorded. But from like a three quarter angle, like in a video game, I guess, and you could play

SPEAKER_93: it back for yourself and figure out like, Oh, what did I say?

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SPEAKER_16: Well, I would say it's, it's, I mean, it's, it's not dumb.

SPEAKER_18: And, and it was actually really interesting, when we started box, and, and this is gonna, this is gonna bring our lives full circle in just a second, you're gonna love the story. So when we started box, we actually were also building a side product called Whirl, and Whirl was going to do peer to peer file sharing. So if you had a, if you had a corporate network, and everybody installed Whirl, you would basically be able to virtualize normally what would be in a server, because everybody would be just sharing files.

SPEAKER_04: Whirl as in W-H-I-R-L, or did you say world?

SPEAKER_18: W-H-I-R-L. W-H-I-R-L.

SPEAKER_41: It's a great name. Yeah, thank you. I'm very happy about my naming skills.

SPEAKER_153: So basically, the idea of Whirl, it makes complete sense because ah, for for your corporation.

SPEAKER_142: I mean, think about it, you came up with the idea of box to put stuff in quite inspired.

SPEAKER_39: Well, I mean, we just try and keep these things simple. We don't want a lot of confusion.

SPEAKER_155: So you workshopped it box. Closet was a close number two. Trunk was third. Shed was up there.

SPEAKER_41: So we were going to do Whirl and box at the same time. And the idea was peer to peer for one use case, storage cloud storage value use case. And our good friend Mark Cuban said, never hedge your bets as a startup. And he said, you have to pick one path. And probably maybe the singular best advice that I got as an entrepreneur, because I didn't really understand that as, you know, like, I'm like, right, you want as much optionality as possible. And basically, he said, no, definitely don't hedge your bets. Bet on one thing. And we looked at it and we kind of, you know, did the math and scaled out the different options and ultimately went with the cloud model. And I think, you know, basically, we've obviously been proven right on the cloud over peer to peer, specifically for our use case. But I think that that here's what I would maybe leave anybody doing anything in blockchain with is you have to the customer has to have probably like a two to 10x benefit because of the technology change. And if that if that doesn't exist, no real humans in the real world, don't change tools because there's some interesting technology dimension to it. Like, like we do in the tech industry, because we want to play around the next thing. But actual humans only change their behavior. If there's some material benefit that they get not some theoretical like if, you know, we'll imagine a nuclear scenario where you want to be able to reconstruct a file and, you know, five people's computers can do it like that's, that's too sort of far off for anybody to actually care about.

SPEAKER_157: And so way abstract, I mean, way too abstract.

SPEAKER_41: And so so the challenge is if you're doing anything on the blockchain, but the cloud version of that today is either solving the problem or even solving the problem better faster because because it's it's more, you know, performant. Or it can be there's a better user interface that will beat the blockchain, you know, 99 times out of 100. So so we need to stop kind of pitching things as because it's on the blockchain and instead pitch. What is the value proposition that a customer cares about that is going to cause them to want to change their behavior? And if it happens to be that the blockchain is the only way to solve that great blockchain is the is then the technology that enables that. But but if it if blockchain is the reason that you're thinking somebody is going to adopt something, you're probably losing the plot a little bit around kind of customer psychology and how to commercialize things. And that's that that would be my point. And I have no opinion about file coin or anything else. I would just say blockchain has to be such a step function improvement over what is happening today for customers to then go and change their behavior.

SPEAKER_18: And so unless that exists, I it's I'm hard pressed to know why that would then take off.

SPEAKER_114: I think it's a it's a correct analysis.

SPEAKER_04: And I think it's a very important bigger picture for founders who are listening to this, which is the majority of the audience is number one, make your bet and then follow through on that. You bet on the cloud, that was the right bet at that time, who knows if the blockchain or, you know, distributed, you know, solutions are the future, maybe somebody will place that bet doesn't seem to me that anybody would ever in a corporate situation say, my God, my storage bills are so high, I need to put them on a bunch of random hard drives and have nobody answer to this.

SPEAKER_03: Well, to save 10%.

SPEAKER_41: Well, that that's exactly the thing like that, that's, that's, and the other the thing that you're fighting against is, I'm going to make up a number, but it's not it's like directionally correct. I just haven't done the actual math. The hard drives we buy today in our storage are probably maybe this way I could actually do the real math.

SPEAKER_13: Well, the 15 you buy the 12 of the 15 terabyte ones. Yeah, always by the last one, right? Well, yeah, yeah.

SPEAKER_103: Yes.

SPEAKER_41: So they're at least 100 times more dense than than the hard drives we bought when we started the company. So think about that deflation, deflationary, you know, trend 100 times more dense storage is now available in the cloud than it was 10 or 15 years ago. So you're fighting a trend that that is not going to slow down. And so the sort of distributed nature of it, there are definitely use cases completely read. But for the average sort of I got some documents, I have a couple video files, that's probably not the sort of higher order bit of that use case, there might be certain compliance or governance reasons why you want it to be distributed. Sure, I have no opinion about that. But like, it won't be because the cost of storage is is the world's problem right now.

SPEAKER_163: In in in kind of current architectures.

SPEAKER_04: When you started the company, the idea to be able to store in the cloud did not exist. Mobile me did not even exist, which was the precursor to iCloud. There was no G drive, there was this threat that the G drive was coming, right, just to be clear, and there was only box and then eventually Dropbox. And the two of you took two different paths, Dropbox said, Hey, we're going to do consumer, you said, we're going to go full enterprise. Those were the two decisions, correct? And who started first? And then how did you come to that decision? Were you aware of Dropbox? And then how did the two companies sort of grow as peers, as it were? Yeah, yeah.

SPEAKER_41: Um, so, so I just kind of credit where credit's due. You know, we did not invent the idea of having your data in the cloud. In the in the 90s, there were many, many failed attempts at this product category. Companies like xDrive.

SPEAKER_18: Oh, right. Yeah.

SPEAKER_41: So it's funny, because because actually, honestly, the all all any entrepreneur has needed to do for the past decade is figure out what people did in the 90s that didn't work.

SPEAKER_167: And just do that better mobile cheaper faster, like we have not invented anything in 10 to 15 years. So YouTube is a perfect example, right?

SPEAKER_31: I mean, people were doing real networks, whatever just didn't work.

SPEAKER_103: Yep, real real networks.

SPEAKER_18: I mean, yep, those were those were the days of the real player. And, and so the the I'm sure Rob Glazer is out there somewhere, you know, kind of watching all this stuff going on. But the but yeah, we didn't invent this.

SPEAKER_41: I everything got attempted from the from 1994 to 2000. And the problem was there's only one problem. There's two problems. Only 50 million people were on the internet. That's a slight problem. Yeah, slight problem like your mark, your tan was really small. And everything costs about 100 times more than it does today. So so whether it was internet speeds and internet bandwidth and storage and computers and servers and data centers, 100 times more expensive. And and basically a hundredth the number of people could use your services. So two really, really bad factors about the internet in 1997. But but people tried xDrive, iDrive. There's a product called Yahoo briefcase. And so right, I remember Yahoo briefcase. So when we started box, we looked around the market and we were like, holy shit, like, like, like, there's these companies that do this thing that were that were, you know, playing around with this idea of storing files in cloud. But for some reason, they give you like 50 megabytes of storage space. And that's the max you can have is 50 megabytes. So you can email two to three PowerPoints back and forth. I mean, upload your down points or whatever. And like, they just have been frozen in time. And, and so they were they didn't store a lot of data. Here's another word we haven't used for a really long time. Ajax was just coming into in the lab. So we were like, dynamic web pages, you could build an actual cloud, you could build an actual rich application in your browser as opposed to these very, very static interfaces. So you basically had this, this, this fusion of a lot of trends that in 2004, 2005 existed that didn't exist in 99. You had Firefox, Blackberry, cheaper storage, better, better ability to have interactive.

SPEAKER_179: Broadband, more people. Broadband internet.

SPEAKER_41: And so we were like, oh my God, like, let's start a company. And so we were the first company of the new era, you know, sort of six years later, right around kind of the Facebook, YouTube sort of web 2.0 period. And we said, okay, let's let you store files in the cloud. And we're going to do a really big idea. We're actually going to give you a gigabyte of storage for free. And, and then basically say, you don't need to buy a hard drive ever again, or USB drive to put all your data in the cloud. And back then a gigabyte was, you know, probably today 25 gigabytes free, you know, kind of in terms of the amount of data people were generating. So pretty disruptive model. What ended up happening though, we dropped out of college, moved to Bay Area, got funding from Mark Cuban, got funding revoked from Mark Cuban. So fun, fun journey there. And, and, and we decided to basically pivot the business to the enterprise market. And, and the reason for that was, we kind of extrapolated out and we said, okay, right now, most of what consumers want are just more storage for less money. And everybody we interviewed was more storage, less money. I have soccer photos. I want to back up. I have my wedding photos. I want to back up. And like, we couldn't get people to talk about use cases that were, that were better than more storage, less money. And so we, we compared that path, which was like, oh God, like Google, Yahoo, Facebook, Apple. It's a race to the bottom. It's a race to the bottom, because at some point, someone's going to have a better business model than us for advertising or selling you a device or some other bundle. And then they're going to give you unlimited storage as a consumer. So we kind of saw that trend in 2006, 2007. We then looked at the enterprise market and we were like, oh my God, for some reason, we stumbled into this market that we never knew existed, which is enterprise spending millions of dollars just to manage their documents. And like, like literally, we did not know that market existed. And when we started the company in college, and we were just trying to solve our use case. So we were like, holy crap, there's one part of the market, which is everything is deflationary and going to zero. The other part of the market, people spend millions of dollars and actually their use cases are kind of never ending because you've got new security needs and compliance issues and new collaboration tools. So we basically did this like over a three month period pivoted the company and said, we're going to go out to the enterprise market. And that was that was sort of that kind of no hedging decision. And then we basically became an enterprise software company. So that was back in early part of 2007, late 2006, pivoted the company. And obviously, you know, kind of the rest has been that path. Dropbox, I think, got created somewhere in 2007.

SPEAKER_18: And, and they, they certainly did a fantastic job on the consumer side, you know, just amazing product, you know, from a desktop client consumer standpoint.

SPEAKER_41: And, and I think they just kind of went off in their direction, which is okay, we're going to do this as a, you know, consumer prosumer SMB tool.

SPEAKER_18: And then we, you know, really just acknowledge that for our play, we had to be an enterprise software platform, and build up this idea of having a cloud content management platform end to end for the full lifecycle of your business.

SPEAKER_184: Everybody knows that Zendesk is the go to tool for customer support. It's the gold standard.

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SPEAKER_82: Tell the audience the Mark Cuban funding unfunding story.

SPEAKER_41: So, so the Mark Cuban funding unfunding story was, was, it was a couple events, but basically we emailed them one day and said, Hey, we'd like to give away storage to our customers.

SPEAKER_18: We want to give away a free gigabyte of storage space. And, and he was like, like, what the hell are you guys talking about?

SPEAKER_41: Like, like, like you're, that's going to be so cash depleted, and you're gonna have to raise lots of funding and you're gonna have to VCs that subsidize it and you guys should just be cash flow positive. And we said, No, no, we have to, we have to do this is the only way to get users. And we actually have a VC that wants to invest. And it was Draper, Fisher, Jefferson, and they had actually done really well. Actually, it's funny, DFJ plays a really important role in this because they did investments in Hotmail and Skype. And we sort of really looked at that as actually a similar sort of, you know, free software distributed to the masses model. And so our approach was, okay, we should do that in storage and content management. And Mark felt like we shouldn't be subsidizing kind of users for growth, we should grow through, through, through more kind of traditional models.

SPEAKER_18: And, and then, and so ultimately, we were able to find a way to buy them out in that round. And which was the series A or B series A round. Yeah.

SPEAKER_13: So he invested as an angel when you were two or $3 million, I take it? As a valuation?

SPEAKER_192: Yeah. No, no, no, I think that valuation was seven or 800 K.

SPEAKER_114: So he puts in 200 K for 20% of the company, something in that range, I'm guessing because I knew his bet sizes back then because he was an investor in our company as well. Uh, two, so he puts in 200 K he owns like whatever 20% of the company. He sells that at the $12 million valuation or whatever happens. 5 million.

SPEAKER_195: Yeah.

SPEAKER_114: Yeah. Only five, right? You sell at the $5 million valuation.

SPEAKER_195: You gotta remember $2,006 here.

SPEAKER_196: 2006. It's so crazy. Isn't it weird? So then he sells it back. He makes a five X.

SPEAKER_197: No, no, no, no, no. I'm sorry. I'm sorry. He, he was willing to take it at cost. What? Yeah. So, um, and

SPEAKER_196: It just shows even Mark can make mistakes. I just had him on the pod yesterday. I mean, it's a mistake. Cause what you should always do.

SPEAKER_04: I've been in this situation now as an angel. And what I do is I say, listen, you know, it's, I had one situation where the founder and I did not see it eye to eye.

SPEAKER_102: He wanted me to give up my pro rata. I thought that was kind of whack. Like I was your early supporter. Now I've got to give up my pro rata. It makes no sense.

SPEAKER_123: Like, um, and I was like, you know what?

SPEAKER_201: Fuck it.

SPEAKER_123: If I, if, if you don't want me here, I don't need to, I have other dinner parties. I can go to, I need to go to your dinner party. If you're going to tell me, I, I got to sit at the kiddie table. There was no seat at the table for me. Fine. I'm out. So I said, uh, okay, I'll tell you what, uh, how about I sell half my shares? I'll give up my pro rata and I'll sell into this round. So I had put a hundreds of the company I sold, we took out 400 and then I still had 400 in the company and I still to this day. So if it does work.

SPEAKER_203: Right.

SPEAKER_123: I have what's called idiot insurance and the insurance in Mark's case would have been even after dilution, probably 5% ownership, which would have been worth $100 million or so.

SPEAKER_16: Yeah. Well, well, okay. So, so, so now in defensive mark, couple things. One, um, our dilution was actually way more than that math.

SPEAKER_41: So the good news is the good news is the paper, the paper sort of, you know, wealth creation, you know, was, was, was small. It's larger than what actually would have happened. Um, and so that, that's the first thing. Second of all, he, um, uh, there, there were threads of, of, you know, kind of complete accuracy in his ultimate predictions in the business. Um, and he was very focused on, you guys should be capital positive.

SPEAKER_167: You should try and control your own destiny. Um, and actually I tell founders that exact same advice today, which is, which is, you know, really make sure you have control of your business model.

SPEAKER_41: And, um, and we didn't have the economics proven out that we would be able to upsell people. So, so I think that was a fair bet at that point or a fair argument at that point, which is like, this might be incredibly expensive and we might be buying storage till the end of time. And what he didn't know was the pivot to the enterprise. Um, and because we didn't have that yet. And so, so there's a chance that, that it could have completely crushed the business. Had we not done that pivot, uh, of giving away free storage in a consumer market. So, so, you know, kind of one of these things where like, you don't actually know the counterfactual of if it, if you'd done something in a different way, any state investor, maybe we would have fucked up in some other way.

SPEAKER_210: So, you know, and this is my point. You're you've made it perfectly and said it better than I would say it.

SPEAKER_04: You don't know the counterfactuals and there is an unlimited number of them. It's like the multiverse theory, like who knows, but all, you know, is this is a great founder, great team. They got me here. I fell in love with them before they're probably going to figure it out. So you just got to keep some skin in the game. Even if you really want to disconnect, just bet the jockey, keep some skin in the game, because what if it does work out and you took all that time to get on the cap table.

SPEAKER_123: So just leave a little bit in play.

SPEAKER_133: Yeah. But again, back into defensive Mark Cuban, um, you know, this is 2006.

SPEAKER_103: Like you don't even meet people. You just, we had an email relationship and, you know, we met at once for five minutes and he doesn't know who I am. So, um, and, and the, um, uh, and then, uh, uh, I think probably we were probably pretty annoying to deal with. I'm guessing. Like, I don't actually, I don't know if we have access to the email server from back then, but like, I would probably not love to invest in me.

SPEAKER_214: Um, just because of like, I'm, I'm a pretty annoying founder. So.

SPEAKER_93: Really? That's pretty self-aware. What, what makes you annoying as a founder to investors?

SPEAKER_04: And were there leaks in your game that you specifically looked at over this, you know, decade plus journey and said, I got to improve this about myself because you did start this company.

SPEAKER_123: You, I believe you dropped out of school to start it. Right. If I remember correctly. Yeah. So, I mean, literally this is your first startup and you've been at it for 15 years. What have you had to change as an entrepreneur? And how did you go through those changes?

SPEAKER_217: How did you become aware of those things you needed to change? I think it's a really important discussion.

SPEAKER_220: Yeah. Well, I mean, I don't even know if I've changed many of them. So. Okay.

SPEAKER_18: I think, you know, I, I very stubborn, very steadfast, you know, sort of, this is, this is, this is my, you know, very strongly held opinion and belief, and I'm going to run into a wall to prove it out. And so like, you know, that, that has certain characteristics can be, can be annoying at times, I'm, I'm sure. And, you know, both, you know, at the, at the investor level, as well as, you know, anybody that is working with me, I've, I've been able to, you know, sort of, you know, tone it down over the years and, and control it more and, and contain it. So, so I think it's, it's not causing probably as much, maybe annoyance and, and, you know, So stubbornness.

SPEAKER_113: Yeah.

SPEAKER_04: Is a strength because in, you could use the same word in terms of framing for stubbornness is doggedness. Yeah. Yeah. And then to the, you know, even more charitable resiliency, and never gives up.

SPEAKER_123: But then on the other side, stubborn could lead to drive in the car off the cliff.

SPEAKER_41: Right. You have to be stubborn and right is the key. And so, and so the, the, I look back, I think,

SPEAKER_228: I think that makes you a visionary stubborn and right equals visionary. Stubble and wrong equals jerk.

SPEAKER_220: You got to find a different career. So yeah. Dummy. Stubborn and wrong means new job.

SPEAKER_41: So. Fired. There's a Venn diagram of, of stubborn and right. And, and you want to be right in that target zone. And I look back, you know, when, when I was 20 or 21, 22 and learning, learning this trade. And there were plenty of times where I was stubborn and wrong, where maybe I took too long to pivot. Like I, uh, my co-founder was telling me, we got to go enterprise probably for, you know, three, six months earlier than we actually did. So, you know, what did, what is three to six months in compounding terms? I don't know. Maybe we'd be 20% bigger now.

SPEAKER_18: Um, as a result of, if I had, if I had not been so stubborn, um, at that stage and not seeing, seeing the information in the way that, that, um, that he was, um, you know, I've been, uh, so, so I think, I think the, that, that can just be a, you know, sometimes a, an

SPEAKER_105: annoying pattern that people run into.

SPEAKER_93: Um, when people buy your product today, what is the sales pitch today?

SPEAKER_04: I mean, I understand in the beginning days, like just even having a shared locker, a way to share documents, you know, diligence lockers, or, you know, two different companies are on teams working on something or two different units are working on files. It was pretty obvious, like why it was needed five or 10 years ago.

SPEAKER_123: But now it's kind of like, you have storage everywhere storage, you know, I, I have a terabyte I pay for with Google. I got a two terabytes with Apple on my family plan. I buy hard drives at my office. I buy, I don't know what kind of, uh, I'm, I'm in totally into storage. I buy like NAS is have like four NAS is with just hard drives on hard drives on hard drives with copies of every episode of this week in startups, multiple of them in the cloud everywhere. But what are the features now that people buy it for? Because you do have the, you know, Microsoft's of the world. I don't know what they call it. It's a smart drive. They're offering.

SPEAKER_235: Uh, they have one drive in SharePoint.

SPEAKER_123: One drive in SharePoint. Then you have Google's, et cetera, et cetera. So you're competing with a bunch of people. What, why would, what are your salespeople tell people when they say, why should I? I buy this versus just using what's in the operating system as you predicted before. Yeah.

SPEAKER_101: Well, actually, um, it's funny.

SPEAKER_103: The trend that you just described is actually probably a net tailwind for us. So the more places, the more places that data is going and people are generating content and you have all these different places to store things, actually, the greater the challenge it is for an enterprise. So if you, if you think about you're a bank and, and there's, you know, files going into

SPEAKER_41: 30 different places, what actually matters is not the storage, the cost of the storage, any of that. What matters is the software that helps you manage that data. And so what, what we, what we've had built and what our hundreds of engineers are always working on is, is the software layer between storage and ultimately the user. And that software layer is workflow collaboration, data governance, data privacy, threat detection, classification, automation capabilities. A week and a half ago, we announced we acquired a company so we can get into the e-signature market. So the entire journey that content goes through, we want to have capabilities for that entire journey. And so it's no longer about like, okay, getting your files to the cloud, like that's trivial, commoditized, anybody can do it. It's really about what can you do with your content and your digital information once it's in the cloud. And what we are working on is our ways that begin to change the underlying business process and workflows that you have because of the new things you can now do with your content. And so at, at a, you know, pharma company that might be, let's actually accelerate a clinical drug trial process at a media company. That might be new ways to go and produce a film at a bank. It's faster ways to onboard a client during COVID. We worked with lots of different governments and healthcare providers and life sciences firms to help with disaster, you know, obviously the, the, the sort of disaster that was going on, whether it was on the economic development side or the collaboration between healthcare institutions and the federal government on, you know, various COVID data.

SPEAKER_167: So that, that kind of collaboration and workflow, that's really what we are now selling.

SPEAKER_114: And so the storage has become a commodity. Does that mean you rack and stack hard drives now, or do you just use somebody else's cloud?

SPEAKER_240: Yeah.

SPEAKER_41: So we, we do a little bit of both, but I would say directionally, we are more and more leveraging the public cloud just because, you know, we, we might be getting the exabyte scale, but we can leverage providers that are at, you know, zettabyte scale and, um, or hundreds

SPEAKER_18: of exabyte scale. And so there's still going to be an economies of scale advantage that we can go and leverage. Um, yeah.

SPEAKER_114: When you add the signature pack, that is something people pay a lot of money for. Uh, currently is your idea. Just make it free. And you just, uh, take sign requests and say, Hey, we'll make that free.

SPEAKER_13: It comes with your box stuff. You can cancel that other SaaS subscription you have now.

SPEAKER_219: So I would say that our strategy is, um, is, uh, we are definitely building on a suite of

SPEAKER_41: all of the kind of individual actions and operations you take around content. So, um, and, and we want to sell that full suite to customers. So not necessarily have like dozens of things you buy, but one thing or a couple of things you buy to have all the things. And so, right. And so that strategically is, is definitely, you know, the, the, the, uh, um, the direction we're going. And so being able to have box sign now introduced to all of our customers, we have a hundred thousand customers, um, that can now become a new module that everybody has access to.

David Friedberg: And there'll be different ways to upgrade for better versions or whatnot.

SPEAKER_13: But, but do you think this is a valid strategy now?

SPEAKER_04: Because we're seeing so many SaaS offerings that one of the things that seems to be happening. And in fact, we've had people, you know, pitch this offering, which is at some point when you have 12 SaaS products, if you can, you know, maybe trim three of them because they're included, like we were going to do, I won't say what, but we were looking at one function and the other platform had it and we're like, ah, but we love this other like niche product. Cause it's better. And then we're like, ah, but it's another login. And it's another thing to maintain. Would we rather have the 80%? It was just like, so if you took that signature request and just said, you know what, I'm going to target every goddamn HelloSign customer, every DocSign customer, and just say free.

SPEAKER_245: It's free for life.

SPEAKER_246: If you have a box account, now you've done what Google and, you know, and Microsoft have been doing to other companies for years, which is just absorbing a function right into

SPEAKER_149: them. Yeah. I, I, I would, um, uh, I would say that, um, uh, directionally that's right.

SPEAKER_197: I, I, I don't want it to sound as maybe, um, uh, you know, kind of aggressive as, as you

SPEAKER_18: worded it. Um, uh, but, but I, I mean, the flare is great. Um, I would say that, uh, here's our, here's our message on the e-signature capabilities.

SPEAKER_41: Um, despite the fact that we, you, me, anybody listening have been doing e-signatures for a decade, the vast majority of the world is still moving from paper-based to digital processes. So, so, so it's, it's kind of one of these things where we're going to look back in 10 years from now and we're going to say, oh, wow, that was still actually the very early days of this market of all the digital workflows around content. And so for us, we, we made the call that said, you know what, in 10 years from now, we don't want to be looking back and saying like all of that, all content, all those digital workflows went to other platforms when we could have streamlined it, simplified it, given our customers more value. So, so it's less that we're trying to pick fights and add more competitors and much more, you know, does this a space that we need to be in, in a decade from now? Answers pretty clearly. Yes.

SPEAKER_153: So, and we're still in the very early, early days of this market.

SPEAKER_04: Do you provide what docs is a doc send that I, yeah, everybody sends me their pitch deck in Docsend. Yeah. And I had, it was funny because I, you know, you say stuff when you have a podcast, you talk for a living like I do. I guess I invest for a living and I talk for a hobby, but I, I basically said like, I can't stand these doc sends because then these founders, I had Russ, uh, Hedelson, Hedelson on, which was very nice of him to come on because I basically trashed his product. And I said, this makes me crazy because they're, they know how long I've been on each slide. Yep. They don't disclose that they're recording that information.

SPEAKER_93: It's in the buried in the terms of service. Sure. And then the doctor knows that I whipped by this slide. So then parent, I'm getting a little self-conscious. So if I open a doc sign and I'm like, I already know this information. I'm like, you know what?

SPEAKER_04: I still need to stay on here for five seconds.

SPEAKER_252: Right.

SPEAKER_04: Because the average VC spends three seconds per, and I want to be more considered. So I'm, I'm trying to stay six seconds or at least five so that I'm 40%, 60% and more considered. You know what I'm saying? Yeah, totally. And then they spend maybe 18 seconds on and they do some notations and ask questions for me. And it makes us look more engaged than we are.

SPEAKER_101: But isn't that a great example of AI is not gonna, I mean, it's creating jobs.

SPEAKER_18: Like creating jobs. There's a new, there's a new job category, which is the doc send link clicker. Yeah.

SPEAKER_123: Well, it's the same thing I do with my, my Fitbit.

SPEAKER_93: I give it to my assistant. I say, can you do me forever go, go down to get me a Starbucks. It's two to two miles down to town, bring it back. And I hit my goal. I mean, it takes a village. Yeah.

SPEAKER_04: Um, how do you, do you offer that like spy on, you know, track people on each slide stuff? And then how do you communicate it? Yeah.

SPEAKER_18: Yeah. Well, we, um, we don't have the level of depth of doc sends capabilities. And I actually, I like Russ Russell a lot. And I think they built a great company there. Um, we, we, ours is probably one click above around. We actually give you analytics of, you know, uh, who access the file and where they access it from and that kind of stuff. Um, it's not as rich at the, you know, how long were they on the slide? Those kinds of capabilities.

SPEAKER_41: But, um, I, I would say that, um, I, I think this is actually pretty compelling example though, of the software beginning to change what you actually do as, as either an individual or as a business. And so as an example, the kinds of things you can now do with those analytics. Now you're talking about as the recipient and you're at like next level, you know, kind of like, you know, um, uh, hacking the system, but as the recipient of those analytics, all of a sudden I have a completely new insight into my, my client. And in this case, it's a VC, you know, customer, a VC, a founder relationship, but, but you can imagine if you're a sales rep or a marketing, um, you know, professional and you want to be able to see like, well, where are people paying attention? What message is working and resonating the most that becomes very powerful. And that's the kind of stuff that 10 or 15 years ago would have been impossible to be able to do with your data and do with your files. And so I think it's a, another data point of as information moves to the cloud, it doesn't just become a cheaper, faster, simpler way to work with it. It actually might under, it changes the underlying thing you're doing with that information because

SPEAKER_18: now you're getting a feedback loop and you're getting signal that wasn't possible before.

SPEAKER_23: And people are doing this now, like even the annotating of documents and annotations

SPEAKER_04: is becoming a big deal. Correct. Like being able to say, hi, I'm at, I had somebody on who, what was the video company, Nick, that I had, we had on Emory Wells from, um, frame IO. Yeah. So this is a perfect example. There are probably people in Hollywood who were storing stuff on box and then frame IO comes out and they just verticalize it, right? So you have the files or one piece, but they're saying, Hey, let's have a discussion on each frame of the video. And so does that mean you lose to, you lose some customers to them or that over time you say, Hey, wait a second. Everybody's going to want to do that. Everybody's going to want to do what you can do on, I guess, envision lets you put

SPEAKER_03: notations on products and frame IO or frame IO. They let you put notations on every video frame.

SPEAKER_219: I think this is a great example of the a, the fact that we're still so early in, in the

SPEAKER_18: ability to work with your content in new ways. And so that's the, maybe like the pretty cool part is because of where browser technology has gone, has gone.

SPEAKER_41: Like the kind of things that we're now even talking about frame by frame annotation and analytics on every single page that somebody's on. Like we literally at box were scratching the surface, you know, in terms of the platform we created just a few years ago and look at all of the new innovations that are now emerging. Funny, funny story on this. We created the idea of, of alerting people when somebody access their file about 13, 12, 12 years ago. And, and we actually, uh, we, we had that. We were like, Oh my God, is this going to be like totally freaky? Like your people are now going to be able to see that somebody accesses the file and, and then, you know, eventually it became so commonplace that you just sort of expect it. I mean, Google docs has this feature. Yeah. People just don't think about it as much. So, so, but the cool thing is like, we're in the early stages of all the innovation you can do with your content. And so whether it's what frame is doing or envision is doing or, or companies like doc center doing, and so we are going to continue to build up more and more value. But the fact is that like people are going to choose. I want a vertical solution because I have some high end set of needs in this one use case, or I want a horizontal solution because I have needs that work across content types or work across teams that are.

SPEAKER_246: Or our very large enterprise is going to have this horizontal solution. And maybe a department will dabble because they need that.

SPEAKER_04: Yeah. But if you're going to store videos box can store videos. And then, you know, maybe you need a Wistia type thing for one application, or you need a, you know, frame IO.

SPEAKER_41: And I think the key is that there's now there's room for multiple, you know,

SPEAKER_153: players in any one of these categories, and you're going to just see different, different approaches that companies take.

SPEAKER_04: You, you were part of a cohort of earlier companies that went public, that in the SAS space seem to, I don't want to say, maybe, I wouldn't say forgotten, but maybe not getting as much attention as some of the, the, the new kids on the block. But let me just talk a little bit about valuation here. You guys have been growing steadily, great, solid growth, but your value like four times revenue. And then I think roughly, and then some of these other SAS companies are getting valued at what? 30, 40, 50 times. Are they overvalued? You're undervalued somewhere a little bit of both. And then, and then how do you think about that on a, you know, sort of pressure of running a public company of, maybe are these valuations going to even out over time?

SPEAKER_262: Or do you need to, you know, up your game in terms of more acquisitions or just getting more attention for the business?

SPEAKER_105: Yeah. So, so I do think that, well, I mean, I literally think we're undervalued. So just, just put that out there.

SPEAKER_04: Well, I mean, I'm just having a candid discussion with you. How do you deal with that as a CEO when your first time CEO and first time public CEO and your four times revenue and some other contemporaries might be five or 10?

SPEAKER_125: I've actually said I was CEO more times before boxing, but let's say this is the first time that it's a real CEO gig.

SPEAKER_275: I am the CEO of this senior class. I'm the CEO of this football team, of the chess team.

SPEAKER_125: The CEO of this domain name. So, so basically, I do think we're undervalued.

SPEAKER_41: There's a sort of, there's a historical reason why, you know, we've gone through some of the public market evolution where we were very high growth, but very high burn. And we've been sort of changing the shape of that model to become much more balanced in kind of the growth and profitability. And that has been a journey where, you know, over a one or two year period, you have to, in some cases, change up shareholders, some, you know, change some of the underlying business operations. Super proud this past year. You know, we've done in kind of the teens of operating margin. And that's, that's a new thing for us, because previously, we weren't producing, you know, much in the form of kind of bottom line profits. And now it's about making sure that we can continue to balance growth and profitability going forward. And I think that's where you start to see kind of stock price appreciation and multiple expansion. But that's, that's the sort of box specific maybe story, as relates to the broader market. I mean, I'm sure there are examples where you have a company that might be trading 50 to 100x revenue. And it's, it's pretty natural that that defies, you know, normal, normal long term trends that we've seen in software. Yeah, it denies reality.

SPEAKER_123: Let's be real. It's just, it's crazy, like some people are obviously things get overheated a little bit.

SPEAKER_102: And so it's, it's gotta come back down to earth at some point.

SPEAKER_39: Yeah, so so I think I think you would imagine that some of that comes back.

SPEAKER_41: But I do think that there's another another storyline in all of this, which is many of these markets, we just dramatically undervalued. And we got the scale wrong by by like, literally an order of magnitude. And so, you know, take a look at zoom, we just got the scale wrong. Like, what what does it mean when a billion people use a video conferencing tool as opposed to typically we think about it as okay, it's 1020 30 million corporate people, you know, that can't make a meeting in person. Okay, well, when it's a billion people, there's a lot of money to be made. What happens when you have software like Twilio, where everything goes digital and everything needs to be sent as a, as some type of real time notification message, phone call, whatever, how much of that is going to be able to move to these new platforms. So, so I think when you look at you know, whether it's what Shopify has done or Atlassian for developers or Twilio for communications technology or zoom for video, you're what you're what you're just seeing is like actually these cans are so much larger than we realized. And I'm sure the entrepreneurs knew that at the time, but but but the rest of the market are maybe they I don't even I wonder if even the entrepreneurs do it.

SPEAKER_123: I mean, I think a lot of times you look at how big Airbnb got, I don't actually think the founders knew that it would be a magnitude more Airbnb is in Paris than hotel rooms. Like, how do you even predict the market that's induced or you they induced a market into existence and a behavior that didn't previously exist.

SPEAKER_13: That's right.

SPEAKER_41: I think that that behavior that didn't exist previously is the fascinating one because I think most of the time what ends up happening even as an entrepreneur, you're like, okay, there's this existing market, I'm going to do something better, cheaper, faster, and then I'm going to like, get all the customers of this market and maybe I'm going to make the market like a couple times larger. And then but like what ends up actually happening is that is that like, and there's somebody should do like, I don't know why. HBS or McKinsey hasn't done like the complete analysis that I'm looking for, which is like, what is the sensitivity between an elastic relationship between sort of reduction and friction of a of a solution, and then the market and TAM expansion. And there's probably some like crazy disproportionate thing where like, if you make something 10 times more efficient, the market size 100 times larger. And like, and just like what happens when you remove all of the all of the friction of that thing, telecommunications with Twilio, being able to start an e commerce site in Shopify, I have a friend in LA that is that created a balloon company because of Shopify.

SPEAKER_123: And that amazing, like those companies are being egged on by how easy it is to start a store.

SPEAKER_41: Yes, and he's making real money, like this is not like a like, like, like, like, lots and lots of people are buying balloons. And, and it's, it's, you know, we might blowing up. It is. It is, you have to blow it up yourself. But yes, the businesses is certainly resulting in that but but like, who 10 years ago would have imagined that like, the balloon industry would be TAM for e commerce, you would never have measured that. And so so what happens when you lower the friction of an entire category? What is the ultimate TAM expansion that then you know, happens as a result of that?

SPEAKER_18: I think we're starting to witness all of these digital markets being, you know, three, five, 1050 100 times larger than what we predicted previously.

SPEAKER_04: I know you've people have offered to buy the company a couple times. I know, Steve Jobs even was trying to buy Dropbox at one point. Maybe he was trying to buy you too. Did Steve try to buy box? Can't say that he did. But Salesforce certainly did other people tried. I'm sure in the early days, you didn't sell. Maybe what's your thinking on that? I mean, there's so many huge giant companies trying to buy revenue and you've got this, you know, you're, you're going to be at a billion dollars in revenue at some point, right? You're at 750 right now or so a year, I think it's around the run rate. So a billion dollars in revenue, nothing to sneeze at. And then you have somebody like Jeff at Twilio, our friend has just been buying everything. Benioff has been buying everything. What did you think of the slack acquisition? And do you think it would be time to consider one of those offers at some point?

SPEAKER_262: Or you just you love running and being independent too much?

SPEAKER_28: Great, great question. And definitely the kind of question, you know, I can't answer very in depth.

SPEAKER_18: But, you know, we are a public company. So we always have to have to always consider what's the right option for customers, employees, shareholders and all of that. I think when we look at the market, I'll just give you kind of my my sort of analysis.

SPEAKER_103: This is about a 50 to $60 billion market when you add up the world spend on storage, content management, document management.

SPEAKER_112: So you're 1% of it.

SPEAKER_41: We're right now we're a little bit over 1% basically. So maybe one and a half percent of the total market size. And so and this is this is a situation where it's not like I'm it's not the and it's actually the funny part is like normally whenever an entrepreneur says if we just get to 1% of the thing, you're like, okay, that's not how you don't ever want to think about that way. But here's the thing. We're one and a half percent of this market. Most of the spend is still today going into legacy systems. So what's going to end up happening is it's all going to move to the cloud. It's going to move off of data centers. It's going to move off of legacy networks. It's going to move into the cloud. And so we've now more or less I'm going to round to a I'm going to round just a little bit, but we're about an $800 million run rate in revenue scale. So.

SPEAKER_18: So if you if you just look at like, where are those dollars going, they're going to go into cloud platforms.

SPEAKER_41: We're one of the largest of the of the kind of cloud platforms in the enterprise to help you manage your data. So when I look at the total market size that's ahead of us, we think a large amount of those dollars are going to move to the cloud. We're in the best position to capture those dollars.

SPEAKER_18: So I think that there's still a tremendous amount of upside as a, you know, public standalone independent company.

SPEAKER_114: Yeah, amazing. Listen, continued success. And thanks for all the great jokes over the years on your Twitter handle.

SPEAKER_04: Everybody follow Levy L E V I E. Congratulations on the acquisitions. Thanks for coming back on the pod. It's been too long. We'll definitely have you come back on again, and really appreciate it and your hiring. But the incredible box building in Redwood City, which I go past by every time I would take my daughter to the AMC there and go get a Five Guys burger and everything. That's over. Are you going to go back to your office? What is your thinking about this?

SPEAKER_294: We are going back to the office. So, um,

SPEAKER_93: How and when briefly?

SPEAKER_294: No idea when or how. Okay, great.

SPEAKER_93: So there you have folks, the playbook is here. I mean, but the vaccines are coming. It feels like

SPEAKER_41: Once a couple dozen other companies go first and we watch how it works. We will, we will soon fall.

SPEAKER_13: So you're thinking summer, but basically fall would be a good time because people could spend their summer. Literally here.

SPEAKER_41: When when we first went to remote on like March 10, or something, we sent out an email that said on March 28, you know, plan to be back at the office.

SPEAKER_125: So, so How's that prediction? It was a 2021 or I'm done predicting timelines on this thing.

SPEAKER_18: We, you know, what we what we tell folks is, we're going to be remote until until it's safe. And then we'll have a flexible way of working once it's safe to get back into the office. And we'll make sure that we, you know, respond to the different needs of folks in the business. We're still probably going to bias toward kind of big hubs, where we have offices.

SPEAKER_41: I am an in person, you know, kind of work workplace person, but we will be very, we will be certainly more flexible than we had been previously on. Hey, you need to work a day or two at home, not a problem.

SPEAKER_300: Want to work remotely? Not a problem.

SPEAKER_13: I mean, how does one compete? I mean, if I mean, Salesforce said they weren't going to do it. And now they did it. A lot of people with big fancy buildings were like, Oh, yeah, we got to go back to this building.

SPEAKER_123: And now they're like, you know what, if Facebook and Twitter say, you can work from home, then how do you compete for I think?

SPEAKER_32: How do you compete for talent? If you're not flexible? I think it's all about the flexibility.

SPEAKER_18: And so we are we are insistent that and very focused on that on the flexible approach, because I have an equal amount of other employees that say, I want to be able to come back to the in person culture that we once had. And so you're balancing lots of different factors and considerations. And so there's really only only a hybrid approach that you can really pragmatically take.

SPEAKER_13: I think that's right, you take a hybrid approach. And then you see how things progress.

SPEAKER_123: And I think what's going to happen is some people who want to work from home, will be a certain class of team member and then the people come to the office will be another class. And what I think is actually going to happen is people gonna be like, you know what, I want to be near the locus of power. And if the founders, you know, Jack decides he wants to work from Africa for six months, or, you know, Kyoto for three months and run Twitter and square from there. Okay, well, then maybe it doesn't matter being the office. But, you know, Reed Hastings is like, we're going back to the office.

SPEAKER_307: And if you're at Netflix, and you're not near Reed, you're, by de facto, not going to be that important to the future of the business.

SPEAKER_197: Well, and this is actually the thing that I'm sensitive to.

SPEAKER_18: So, so I think we're gonna have to check our own, we'll have to check our biases on that one of, of, and, you know, certainly do our best to not have such an over rotation.

SPEAKER_41: I think there's probably some natural phenomenon that happened. Well, you know, just just because of just human nature.

SPEAKER_18: But, but I'd like to see if we can push the limits of what a hybrid model looks like, and just creating the right flexibility and choice for folks. So we'll, we'll see what happens. Check.

David Friedberg: Let's do one year from today.

SPEAKER_311: Well, we'll, we'll check in again.

SPEAKER_04: All right, that's it. We're putting it on the calendar for one year today. Exactly. We're going to book it with your comms folks, who I appreciate them setting this up. And we'll see you all next time on this week in Star Wars. Bye-bye.