I was offered $200M at 24 and I turned it down

alright today's episode a special we've got matt mu matt founded a company called the wordpress which is used by something like forty five percent of all websites on the internet so it's is huge thing and we talked to matt about a bunch of interesting things sean what have we talk to about he had an offer to sales company for two hundred million dollars when he was twenty four years old he turned it down we asked what that was like we talked to him about some of the recent drama that they've had we talked about how they've been acquiring companies they bought the small company in south africa and how it turned out to be a huge thing for their business like you know a billion dollar plus win and he's just a student the game he's been doing it for like twenty years this guy started this company when he was nineteen years old and is still doing it and it's become this absolute juggernaut so enjoy this episode with matt mon his travel never looking back tell me if this is right because this sounded like almost too good to be true but i'd read that in two thousand eight you an acquisition offer i think you're only twenty four years old for two hundred million dollars at that point i think you'd only raised a million dollars and i think you raised a million dollars at three million in valuation something like relatively you're twenty four you're gonna be worth nine figures something crazy like that you turn it down but then you talk about how you didn't have control of the company because you're were young and maybe just like made some mistakes with funding something like that what's the conversation like with yourself and you're like i'm turning down something that might make me worth over a hundred million dollars at the age of twenty four you talked about and your name in the first million it's kinda funny like i guess technically on paper my first moment was that first funding route right in theory i like half the company that was now worth four million dollars but as you know like that's paper money i was still you know eating ramen and and mountain the dew pizza like living you know a very broke san francisco college kid's life but it was in in two thousand and eight that we had this acquisition offer and you're right it was about two and a half years in this company someone tried to bias us for two hundred a million and the investors at the time did something which now was quite common but at the time was was pretty forward looking which is a a secondary so they said said it wow you we're twenty people we've been doing this for two and a half years a two hundred million dollar exit would be pretty amazing like i said i would walk away personally with a lot of money but we think this could be actually way bitter so let's let's build that and so we took that acquisition made an evaluation you know turned that into a funding around we put a lot more capital into the company so we could you know really build things out and i sold some stock myself so i that was my first that was my first million liquid was kind of in two thousand eight i think i was twenty four and that was a step change you know i was able to like pay off my credit cards and buy mom on my house and like you know all that sort of stuff that you you wanna do that you dream up and it sort of removed some of those sort of early economic things and i was really able to focus on just the business and swinging for fences which is what they wanted me to do you know i hear these stories like suck turns down a billion dollars from yahoo or whatever this story about you at such a young age turning down the opportunity to exit and have this huge payday i think you're a better man than me i don't think i would have been able to resist that was that an easy decision for you was that a hard decision like what and like you're like i think this could be your bigger let's go for is that just like not blind faith but just like an extreme amount of self confidence in faith like how do you even or did you even wanna do it and the investors were like nah too bad no it wasn't an easy decision at all of course to really seriously consider these things also it was a fiduciary you know like you have a responsibility to shareholders consider every acquisition and we've had other acquisition offers and people trying to buy automatic yeah as recently as this year i think you have to ask yourself with any acquisition like will the mission that we're doing be accelerated by this transaction or will it be hampered like we acquired a lot of companies it's like woo commerce i think did a lot better because we acquired it than they would have on their own but there's probably other things that we tried to buy that we that we didn't buy that did really well on their own reddit was one actually we we looked at it at one point did you look at them in their content nest ten million dollar valuation days i actually really want to buy a red i couldn't convince my board they thought it was like two outside of our early stuff so we never got that far on the discussions or anything but yeah there was a point when they were like four employees and for sale kinda and the wired offices on third street in san francisco i just thought it was really cool so obviously they there's no sure well but when you created wordpress it seems like it took off like within a year i forget which year you started it but like i said earlier i think i was using it starting in like ten or eleven two thousand ten thousand and like pretty early on and i at the time was like a tennessee college kid so if i had heard about it then a lot of people had heard about it what was the first version of wordpress like two thousand three oh wow okay i wrote a blog post on this called like meaningful overnight assessor because basically like what people see is overnight success is often a thousand days of relevance or people haven't heard of you yeah one point there was a joke that wordpress had more developers than users the first few blogs were just ones i set up for my friends at high school you know because they one was using software so i just kinda like would manually set it up for people you know early we used to do these upgrade parties where just i'd say like you know i do version of wordpress come out i just open up my apartment you know go to costco bought some booze or it's pete said said hey just come to my apartment and upgrade your site for you so you know really you know the early days were very much bootstrap you know just doing everything it it looks like overnight success later we had some breakout points you know when removal type changed our license and other things i think fortune favors to prepare it was because we had put in a lot of grind a lot of work a lot of community building a lot of contributions a lot of code or a lot of everything in the many many days before that but what's crazy to me is i remember like four six years ago it said that wordpress was used by something like thirty or twenty percent of all the websites on the internet then recently i went and looked at it now it's like forty percent and like the thing that struck me i was like are you the most under monetized business on earth how are you not like the biggest company on earth because i used word press and i used woo commerce which you also own at my old company my woo commerce license sean i think it was a three hundred dollar lifetime or three hundred dollars a year and the product that i was using it was making many millions of dollars and i've got a friend sean you and i both have a friend who made a hundred million dollars off of the three hundred dollar a year license or whatever it was it was like nothing you guys have to be like the least monetized company there is i think the way i put it is wordpress is almost like kind of the dark matter of the web you know would you build like a list of like what's the top website you know we're not gonna show up i mean wordpress dot com will be in the top one hundred or whatever the beauty of it is that you know the ecosystem of wordpress is probably like ten billion dollars a year at least of revenue now my company automatic is you know five percent of that but if you add up all the companies and all the people i'm not counting like all the stuff that you talked about like people selling things the woo commerce which we know is like think last year was over thirty billion of goods and services sold to commerce but actually more than half of automatic revenue comes from things that aren't just wordpress so we have a variety of different businesses some really mobile apps like day one or pocket cast i new one called bieber what were like the top two acquisitions right like even buffett for example if you study buffett portfolio it's like a huge amount of the gains came from like a couple of like really key acquisitions at key time right sees candy at a specific time as given them over a billion dollars i think of free cash flow over the years what's the revenue number that you could say the whole company does we've public the same for we're over half a billion of everything now okay got it alright so yeah to answer sean's question and what's been the surprising thing what are like the crown jewel like best acquisitions that you feel proud of our most successful is probably woo cars and so this came a lot from you know wordpress is a platform and so i did a lot of study of platforms and so that led me to do a lot of deep reading on microsoft actually and it was funny like if you look at some of the press rounds windows ninety five coming out they talked about how for every dollar that microsoft made from windows there was twenty dollars made by the word windows ecosystem by the way that ratio is similar to the way i talked about earlier where automatic makes about five percent of the money the wordpress ecosystem i sort of found that platforms often do this they create a lot more value a true platform have you heard that story of bill gates talking about the when he meets mark zuckerberg talks about the facebook platform if you heard this there's like a quote i remember reading which was like gates was like this is not a platform he goes a platform is when the companies built on top of it generate far more value than the the the host platform whereas the facebook platform at the time was like facebook was this ga thing all the small things on top and facebook was just sucking a lot of the value back in and he he kinda famously was like that's not what a platform is i would agree with that assessment and also that's not a platform which now a lot of businesses are built on and there were some that sort of came up in their early days like z whatever or spotify even but it it's now not something that like every business is built on because you can get work pulled like a not true platform they might give you some distribution early on when you align with their interest but then they can easily pull the program on which i think facebook ended up doing to a number of companies so yeah i want to build a true powerful but of course microsoft famously had microsoft office so they had an application built on top of windows which ended up being very lucrative so it was like what's gonna be you know i have this platform forward wordpress which is now becoming like a operating system for the web we were obsessed about backwards compatibility and auto updates and things like that learning a lot from successful operating is fast what's our microsoft office and that ended it'll being woo commerce which was a sort of a small company like i think forty people based out of south africa plug in for wordpress it actually started as a theme company it's called woo things they developed this actually a fork of another open source e commerce thing and they they started doing it just to sell more themes because themes were kind of the big business for wordpress at the time and this e commerce plug took off a bit actually we looked up buying it years prior you candidly the code was really crappy and so we're were like oh this is like really crappy code we're we're were you know artifacts very much like a engineering led like technology r and d companies so like god this is but it just kept taking off because they did such a good job like building something people want so even though the code wasn't scalable real organized you know they built something they they were really great to that product market fit so woo commerce was taken off so we that was an early acquisition that we did finally enough the competitor there was there were there's a private equity that was trying to buy this plug so we kinda went over the private equity because they wanted to join like our culture and everything like that and woo you know like i said at the time it was forty people pretty small they only had like four engineers by the way so a lot of those people were like customer support or other things we were able to take what we were really great at which is like engineering scalability all that sort of stuff and apply it to what they had done really brilliantly which is like great this thing that people love to use and that's like i said they last year over thirty billion of goods and services sold so that's that's definitely one of our our best acquisitions that we've done but i also that e commerce is an incredibly competitive space and you know we're we're blessed to have an incredible competitor shop which is a company i have a ton of respect for you know the the founders and entrepreneurs and the whole thing that actually a really really great company know toby and i think have a a lot of mutual respect for each other you know drive other that'd be better so do you look at that this is again like we're kinda giving you a compliment and an insult at the same time so the backhand of compliment is in full effect here so on one hand we're saying you oh my god there's forty three percent of the internet uses wordpress or you know y'all products there's five hundred million websites using wordpress like that is just such a mind boggling number and so on one hand that's absolutely incredible and on the other hand sam was saying are you the most like under mono given that are you the most under monetized because you look at like a shopify shopify alone right now market cap is a hundred and fifty billion the ruthless capitalist could say matt you're doing all this work and your whole company including woo ecommerce and all this stuff is gonna be worth several billion dollars but the closed source shopify all like variant of of of the of the e commerce side is worth a hundred and fifty billion what should i take away from that and what do you what do you take away from that what's what meaning do you put on that there's definitely some things that are easier in a proprietary sort of closed ecosystem software model you know it's easier to you know shopify is really great at forcing people to use their payments for example and in woo commerce you know you can use ours but you can also use a lot other stuff i think there sort of average revenue per subscribers is is like ten x what what woo commerce is this how i think about it is is very much sort of short term versus long term so one we have this philosophy of open source i want all of the work i do all of my creative output to increase the amount of freedom and liberty in the world i just something i i believe very morally early so that's why i dedicated my life to open source because open source software you sort of have a bill of rights attached to it right the freedom to use this software for any purpose to see how it works to modify it to reach distributors modifications the four freaks instance of the gp to me that's that's a moral decision the software i creates i want not to have a proprietary license you know shopify is amazing if shopify change your policies tomorrow their customers are stuck with it they have their records recourse or their proprietary license we're with open source you know we could change our policies tomorrow i could become evil or whatever and automatic could be sell or be a terrible company you would still own all the code you know wordpress and woo commerce etcetera belong just as much to you as they do with me and that's sort of freedom and liberty is i think better in the long term so i'd say open source has a slow burn so it often is kinda slower to start up but then over time it builds sort of this compounding momentum that is a bit unstoppable and does two things one it could be very successful in his own right as wordpress has you know it's ten x the number two in the market but two one great thing it does is it forces the proprietary folks to be a bit more open so i i use proprietary stuff myself and a lot of apple things that proprietary and i you know i really love their products i think apple is probably a bit more open than they would be otherwise because android exist there's there's an open competitor and which just by the way open source and that it kinda influences the market so even if we don't have making much money as shopify or don't have the market share shopify in the commerce space yes although you know checking in ten twenty years let's see where we are when we force the proprietary folks to to be more open with how they do things the the short answer there is basically i do it because that's what i believe i believe in open source so i just believe that the moral decision comes first and secondly in the long run let's see in in the long run what we'll see is that is that a good good number propriety it's just as easy to have a failure of a proprietary company as it is an open source was like so i think you know be proprietary open source is a little bit affordable or not causal to like whether you're a successful product or not people get really attached to it but i would say in the short term it's definitely usually a bit easier to monetize purely proprietary stack but over long term you can create a much much bigger thing if you have this kind of like flywheel of an open source a community adoption etcetera innovation you know how of innovation happens with open source by the way sam isn't it nuts that matt is clearly like this thoughtful almost like sole entrepreneur who has been building this thing since he was literally like a kid nineteen nineteen years old like a guy you'd call wise when he was twenty one yeah exactly like oh he's an old soul type of thing works on open source software like you said it's widely used it's almost free it's so like only good all i hear is like only good and then you had this like random villain arc that people tried to paint on you in the last you know year with this like drama that's going on i couldn't believe it i was like if i was gonna put money on who's like the least drama attracting founder it might have been you so i thought that was nuts sam quick your reaction to that real quick and then i hear matt's slots on it so i didn't follow it too much i'm a wordpress user but i just and i'm friends with jason cohen of wp engine you guys had a a fight but i was actually shocked matt i thought that some of the stuff that you said i was shot you like people were insulting you and you felt like insulted them back i was like i've read a lot about matt's work i don't know matt and i've listened to him he doesn't seem like someone who had ever like insult someone and i was actually surprised that you were going as hard as you were and i guess your perspective is like they're coming after everything i made or they don't contribute whatever but i was actually surprised that you were pissed off and i didn't think that you would be the type of guy that would come off pissed off you know a failure mode and i think that can kill many open source projects is one to get get taken advantage of and so just like a school yard bully like he kinda have to stand up for yourself it's kinda funny because you say you don't think of me doing this but actually if you look at the history of wordpress there has been maybe four or five times in the history where i had this kind of bill arc people were like i we had a fight to protect like our principles and and like the sustainability and like the future of wordpress can you give the one minute summary of what happened because i even half followed it and i'm sure there's a bunch of people listening that don't even know what we're talking about could you give like the one minute and try to be objective with this like like not not just the your side of the story but there's what what happened can you explain you know it's an ongoing legal battle so i can only say so much basically there's a a company called adobe engine started off like very positive in the community jason cohen and i think is awesome by the way but in twenty nineteen they were bought by private equity for him called silver lake and sort over the subsequent five years started becoming i would say more parasitic of wordpress also creating with how they were marketing themselves and branding themselves a lot of confusion in the marketplace in a way that was threatening our trademark yeah the word wordpress trademark so people which sort of say oh it's wordpress engine and they wouldn't correct them and they they were think it was official i even had very close friends who were wp engine customers who thought that was my company and i would frequently get support requests for wp engine like my sights down and things like that you know for a long period of time and you know two years prior to this freight started was doing our best to partner with them and resolve all these things and resolve the trademark stuff they just weren't responded and basically wp engine is a web hosting service maybe only for wordpress sites and the accusation i believe was that you felt they weren't contributing to the project as much as they should've have been given that they make like a lot of money and also people confused the two companies on the contribution thing is that like i i guess like what's your leg to stand on on that you know for example you know does somebody have to contribute is that like a rule or is that a a a suggestion right is this like you're at church you should put something in the tray but you don't have to technically but your friends frowned upon like what what is the take there so workplace we do have this program we call five for the future by the way this is all voluntary open source license you don't have to do anything you do whatever you want but we say that if you're building a business own wordpress if you can allocate no somewhere between zero one and five percents profit or revenue it doesn't matter however you want to define it it could be time could be hours it could be whatever but and put that back into what we call core core wordpress which is something that belongs with the open source project so it's accessible to everyone doesn't just benefit your company that's part of what's made us sustainable and allowed us to be a open source project which has really thrived more than you know some of you know other great cms that were open source that came up at the same time i'm like j large or dr or something like that which haven't has as much assess us by the way i think this is great self interest as well wp engine is fairly unique in that pretty much every other company in the wordpress ecosystem does this quite a bit and in fact if you look at old versions of wp engine's website they were you know very supportive of this and actually even say on their website they would dedicate you know to or afford full time people and everything like that you know fast forward of twenty eight twenty four they had less than that i'm core so i think that's that's a whole like sustainability health of the ecosystem health of the product issue that's not a legal issue at all the trademark abuse of not just the wordpress but also the woo commerce trademark so you could argue that wordpress wp whatever but like they're also using the boot congress trademark which is fully owned by automatic you you have to protect that if you don't protect your trademarks you lose them and so we're having discussions around that we have trademark licenses with other web post great relations with every other and they're they're just a web host they're not a tech company they don't really create a lot of ip and they're web post which people think is the largest but they're actually you know probably the sixth or seventh largest wordpress post there's a lot of bigger ones they're a single digit percentage of all the wordpress in the world know they probably have like seven hundred thousand eight hundred thousand or something so people have made this into a bigger deal it is you know so these previous controversies that got mainstream media coverage shows you know cnn i i had this hot nacho show scandal over the first couple of years at wordpress or a thesis fight or the easter massacre here of themes like all these things i mentioned mentioning you probably haven't heard of it used to be like half my wikipedia page now it's not today as you go to by with wikipedia page your their p firm has the whole paragraph about this i think in five years this maybe it'll be a sentence or not even all there at all so it's not my first rodeo sometimes you have to fight to protect your open source ideals and with community any end in your trademark by the way i expect this to resolve in the next few months although it's easy to find like you're on reddit or twitter i get a lot of hate a lot of people were pissed at you i i tweeted out that you were coming on to the pod yesterday if there was a lot of angry people and i wish i was a little surprised by that to be honest yeah and you know some of the people are uncomfortable with you know us having to to fight protect ourselves you know wp engine took some very aggressive legal action so turned out when we thought we were sort of good faith negotiating they were preparing a legal case to attack because you know three days after i give this presentation they launched a huge lawsuit with quit emmanuel it's kinda like the one of the biggest nasty law firms and you know private equity is so famously like goes in hollow out businesses extracts all the value kinda kills it is this crazy story i know if you saw it recently where like one of the reason there was like shortages of fire trucks in la was like the fire truck manufacturers have been like rolled up by private equity and they've been like jacking the prices and that was like huge waiting list for like fire new fire trucks and fire truck repairs and there's lots of examples and not all private equities bad there's good investors and bad investors in every asset class look i i i didn't follow the story in depth i didn't need to i'm not a lawyer don't need to be it's common sense to me who side if i gonna be on the the private equity backed company that's that you know sounds almost like it's made by the by you guys but it's not or the founder who's been working on this for like you know twenty plus years of his life open sourced it is you know used by everybody it's kind of like a staple of the internet and you know captures like a tiny bit of the value along the way it's pretty obvious to me you know which side i was gonna gonna come down on so i think it was it was actually a common sense test i think for most people and i can't believe how many people are like you know on the pe side it actually reminds me a little bit of like the ai stuff right now wait sean we did a whole podcast about the under of this pe firm though and how like fascinated we were with them we do profiles on ruthless killers and then we're at the end we're like isn't that awesome like yeah do you wanna be that way hell no not gonna it's not me but like i'm glad that these people exist like you need all these people in an ecosystem like it's not they're not all bad and there's impressive things about how i think they e du or whatever they like i think that's the guy that we talked about you know the it's impressive in the same way that david go is impressive but i'm not gonna go out there and run until my toenails bleed like i like that he exists that doesn't mean i wanna be like him or even that i think that's the right thing for most people to do i think it was on on your blog it could've have been on tim ferris podcast you wrote about how i think wordpress or automatic has like roughly two thousand people and i think you wrote about how you tried a bunch of different ways to hire people you're like did all these tests like google does like these like brain teaser and you tried a bunch of other stuff and you said two interesting things that stood out you said what i found is that the people who are the best writers oftentimes are the best people who we hire not phds not master degrees it was a a correlation between your ability to write and communicate via the written word and then the second thing you said that was pretty wide you used to hire people just by like emailing or texting like it was like just through chat not ever face to face not phone calls things like that do still hire people strictly through text communication you know for some roles who might do zoom if it's a sales role or something like that you know obviously it's important to see how someone interacts but basically you know for a lot of our roles you know written communication is gonna be the primary thing but also like people wanna talk to someone like we're not gonna be like you can't yeah a lot of our hiring process can be completely asynchronous and completely text based and for the first thousand or so hires i did a final chat for every single person is your chat like slack or g chatting or something yeah and ended being on slack when when slack was a invented you know before that i think it was on like skype or a or something about in the early days or or irc i think the way you said it was we do audition not interviews so what what does that mean how do you how do you do audition well we do a trial project so we actually hire people on a standards sort twenty five an hour contract and so we pay them to do you we have screens with you know resumes and a little interview up but then we say like let's actually do some work together and and there's various versions of this for different roles we've done sandbox versions we've also done it where they were actually talking to real customers you know like a support person was actually like answering real tickets we've always been smaller than a lot of the big tech but we compete with them and so we need to have like the same caliber or better of talent so part of i think automatic advantage is we've created an environments and also sort of a way of hiring that finds people who might be overlooked by sort of a a matter or a google or something like that and we give them an opportunity not just to be higher but also to participate in a company in a way that they can still be just as influential and have as much impact because even like you know there's there's other companies that might have remote workers but if you're not at headquarters you're not gonna be you know close to the sign gonna be nice to ceo you're not gonna be able to grow or or have an impact but we've tried to create it where our center gravity or our headquarters is really on the internet and you know i have colleagues in ninety countries i even though we're only you know seven hundred fifty people and another sort of innovative thing we do we didn't do this in big beginning but we moved to it probably like twenty twelve twenty thirteen is we pay people the same salaries regardless the location so it's it's kinda funny because well like the quality d stuff whatever it's so much of i feel like is vi signaling because if you ask these companies and say like hey you know i'm not gonna call anyone help by name let's say a big tech company do you pay someone in pakistan the same that you pay them in california usually answers no if they're doing the same job yeah the same like code wrangler or engineer or whatever like that and they usually say no and they usually have some reason like living or local marker whatever but we sort of moved to where he said hey same work same pay you know it's kind of a something that you know the past hundred years that wasn't always true for men and women even you know or or racial things or something like that so i think the same more reasons why i say like same work for same pay of you know people of different skin colors or something like that within a country i think you should do that globally and i think that's the future of work actually because to stiff that you can be equally as valuable and generates as much value for a customer wherever you are you should receive the eco equal pay for eco equal work have you guys read american king pin the story of ross soul right the silk road have you read that matt i don't know i think i've read some the long for my articles but i've never read the whole book yeah oh you gotta read this book man i'm reread it now because either got released and it's like the best book i've ever read it's like a total page turner the story of it for listeners is basically ross was a accused and i think he did it where he started silk road which was ebay for drugs in two years it did two billion in sales gross sales something like that but what's crazy is it kinda sucks because this whole business was documented because he chatted with everyone like he had twelve coworkers and he did two things that were interesting that i actually think are gonna be common the first thing is that he obviously because it was an illegal enterprise he never they didn't know the identity of the workers it was just their username like one guy's name was like chronic pain was his username so we just he didn't know this guy's real name he just knew chronic pain as like the guy ross knew everybody's name they didn't know each other's names or his he made them send a license so that he could basically have that like you know always have that in his back pocket have leverage but chronic pain didn't know ross sorry i forgot that was actually important detail that's actually very similar to like early hacker agriculture you know everyone was sort on why their username there's like interesting merits to that and then the other thing was that they only communicated via messaging i was reading this book i'm reread it now and i was like those two attributes are kind of interesting for a company which is like anonymous workers and but you're still oddly friends like he'd be key developed relationships with his coworkers this is a great linkedin post for you sam like thirteen management lessons i learned from the silk road here you go i believe that he did murder for hire of four times so he did a lot of bad shit but he was actually an an inspiring leader like when he read like some of his like like stuff well he was very idealistic right like he he had certain beliefs that drove right he he didn't intend like he didn't necessarily intend like for example he wasn't super interested in selling guns on the platform but he believed that people should be able to sell what they want and his team was like no no you shouldn't do this this is gonna increase the target on our back like you're cool with the drug side but you don't care about this delicious ban it it's gonna cause problems and he was like well no that's not the ethos of what we're doing like we wrote a creed of what we stand for and why we're doing this and therefore we gotta stand by it and they called them captain you know it was very much just like we are revolution thing and that's like an really interesting thing matt has a you you don't get called captain but what is your like a ben ambivalent dictator for life right b bd nfl it's a term in open source that's applied to like line analytics or gui python or something like that david time hansen it rails it's sort of a joking thing and one that i think none of us like really touched or ourselves too just kinda like an internet thing well you do a couple other interesting things right because you have this like multi billion dollar company used by most of the internet but you run your company these interesting ways where remote work i think you're famously we're early and heavy inter interrupt work and and you've talked a lot about that but you do a couple other interesting things so we talked about audition instead of interviews but you also do everybody in the company including yourself works customer support i think one or two weeks out of the year can you talk about that one yeah part of our hiring process is your first two weeks or doing customer support for every single hire whether you're like our new cfo or chief legal officer or or whatever rule it is and then once a week a year you rotate back and doing customer support by the way lots of companies have versions of this so it's definitely not more the first to do or anything like that why should a company do that if you look at every successful business the closer they at to customers generally more successful they are and so it's very easy especially when you're running something on the internet and distributed for people to become numbers or stats or something on your liquor dashboard or something like that and so you know getting back to like every individual every number of your sign ups you might have five thousand sign ups in a day but each one of those people is like has a story you've just learned a lot about your product and it's i think the best way sort do iterate customer developments i think eric agrees talked about this or steve blank you know they're kinda like get out of the office and go meet the customers and i very inspired by like leaders at salesforce talk to mock b off or something like that they'll typically spend a quarter to a third of the time with customers even at that scale is there a story or any epiphany you had from doing this you've probably done this now you know for for decades so is there like an insight that came from this just other the day a few days ago i spent like thirty forty to five minutes with the gentleman who kind of checks expenses at the company you know because anyway we have like these ramp cars and people that expense things and stuff like that you know sometimes we like say you need a receipt for this or we're question expense just called to understand more about this and also make sure that the way we were doing this was the most hated band at the company by the way like oh well i had gotten some feedback from folks they felt you know some of the questions they were getting felt a little aggressive and so you know we we wanna talk about one i just stop kinda wanna see like the tools you use and how the worked did and stuff like that so some of that was just shadowing so i was like okay because i wanted understand the interfaces this was also really helpful like going through support i realize that some of our internal tools like don't represent know best practices and design or usability use some you know sometimes you know so the internal stuff doesn't get the love that your external stuff does but then also yeah we just sort of talked about like a culture of automatic bedside manner you will like how how can we like you know hold these principles like we need to really force our policies and make sure we do you know we get audited and and everything so like we we need to have these things from like a good accounting principles point of view but also doing it a way that like when we have these conversations we're talking about the principles of it yeah and the reason why so it's not just like i've giving you jean a hard time because you didn't have a receipt but like hey if we don't have this receipts you know it's internal an art firm might question this and then you know that my credit issue for x y z or something like that when i first moved to silicon valley i i came to work with this guy michael birch and he was he represented everything i wanted he had already built like successful tech companies and he had made it and i was a twenty three year old kid who wanted to make it and so i'm super excited to go into the work the first day and i'm like i'm gonna learn so much from this guy because he not just done it one time he's built like four successful companies i'm ready for him to teach me to kinda like the dark arts i'm like what's the strategies to growth hacks what this like super like high level strategic thinking and the very first week he puts me on not the new shit like the oldest company that he had started something had started back in two thousand and one it's like birthday calendar or something yeah birthday alarm is that still going birthday alarm still going and so i as like twenty five year old company now so i at the time i was like oh man like i gotta do this like whatever and he tells me the story so i actually learned this really valuable lesson in i go so what's the i got curious because instead of just like being bored at doing like birthday alarm which you know seemed like this old outdated product at the time i a little curious so i started asking like where did this come from like how did you even come up with this idea why did you build this product and what he told me was he goes my very first startup i'd quit my job i wanted to like build a successful tech company like do an internet company internet was like the new thing back in ninety nine two thousand and he quit a high paying insurance job while his wife was pregnant and i was like i'm gonna make it so he tried to create something really fancy so he's like oh with the internet he tried create something that many people have tried like sean parker tried to create this a self updating address book which is like you know i have your information i have your name your address but you move matt now i don't know that you moved so wouldn't would be cool if you could just update your info in one place and it updated in all your friends address so we now have your latest and greatest address so that's what you wanted to build and he's spending like nine months heads down like doesn't leave the bedroom coding this thing and it's not really going anywhere but because he was a one man show he was also doing you know he was the designer he was the developer he was the ops guy he was the customer service guy like he did all of it and he was like it's the customer service that was actually the key because he was answering support tickets and he's like over and over again i he's like i spent like you know seven hours a day banging in my head guess all while trying to figure out why nobody wants to use our product i think it's so cool but nobody wants it and then the hour i was doing customer support he's like i noticed that a bunch of people kept thanking me for the birthday reminder feature had built in like just the one feature which was like a throw away idea which is just if you know forget the address if it was someone's birthday i would just tell you you know hey it's our birthday today remember that this before facebook existed right so you didn't have facebook or or a bunch of other ways that people could do this so he just threw away the whole product and rename the company birthday alarm dot com and he's like i expected to go nowhere and that was the thing that took off and you know at that time birthday alarm had generated for him and his wife personally like probably twenty million dollars of pure profit by that time because it was just every year was just generating a few million dollars of profit and it's still to this day generating a few million dollars a year of profit like it's this incredible business this is a gift that keeps on giving that only came because he was answering the support tickets and he got curious like like why are they keep talking about this brother minor thing that is that actually maybe i should do that he did it on a on a whim and then in two days had built the product that actually people wanted you know that's awesome i have one last question for you it's on ai so there's a lot of stuff you could talk about with the eye but i just i'm curious on your quick take about deep seek because it's also you know they came out with this open source thing that there's a lot of people on either side of of you know how much they believe about the story but like what's your quick reaction to what you saw with deep seek deep is a really cool model so you know every model has like kind of a vibe at the way it's tuned and everything like that and and so it's a really fun one to play with and i would say you know the thing i i tell people with all the ass stuff just like use it play with it you know because it's such early days and there's kind of a you know the way to prompted the way to interact with it there's a a skill there that you'll learn and the vibes of of the deep sea model or vertical i think what's i'm most excited about as an open source guys that they actually open source the model we're really amazing papers about how they built it and it open weights like for example at my company i would say don't use like deep safe dot com you know for various reasons that's hosted in china and stuff like that but like we can run the model ourselves you know locally and that's pretty cool or you can get it through complexity which hosted in the us so like there's there's lots of ways to access it it's it's a really fun model so all these models have are like good of different things they have a coding version they just released a cool image thing and so think of these as like little entities that you can interact with and run and spin up of boots and you should just learn the nuances and and kind of flavors of each one matt do you guys actually believe that they've only taken the amount of funding that they've said do didn't they say something like five or ten million dollars they said that's what it cost to run the final training that might be true for like some something but obviously like i'm sure they've spent invested a ton in in and other things so and i know there's kind of this theory that maybe that's like a a p or si up or whatever like that when i started reading about them yeah i got fearful it was pretty insane right that the market reacted to weight did that you know it wiped out a trillion dollars of value in twenty four hours it it it was pretty wild how big that announcement was i didn't think i didn't think that was gonna happen and i think you called it matt didn't you tweeted about this during christmas time well aj cap capacity you know so full credit like tweeted about this like the day of the christmas and i i saw his tweet and re retweeted it so that's why i first learned about the deep zeke started playing with it yeah i think that was all these things there there's some you can verify all things they they made some amazing advancements and like how they train things and how they run things and now they did memory interconnect and and working with constraints there are some really cool engineering breakthroughs and they shared it and this is stuff that i think open ai had also figured it out but they hadn't like shared it publicly and so what i love about the deep guys is they they're open sourcing at all so and it's all available under like a true open source license it's not like the llama license where it's free to have seven hundred million users or something or or i think quinn and alibaba one which is also a really great model that people are sleeping be on so check out quinn and somebody's these other the model's coming out of china they're really really good but it's it's a true open source lights so that's awesome matt thanks for coming on matt it's good to see you again and just sharing everything you did about about wordpress it's been a pleasure yeah we appreciate your man alright that's the pod i feel like i could rule world i know i could be what i want to i'll put my all in it like a day's off on of travel never looking back