This week Adam is joined by Michael Grinich, Founder & CEO at WorkOS. Michael shares his journey to build WorkOS, what it takes to cross the Enterprise Chasm, and how he’s building his sales organization for growth.
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|Chapter Number||Chapter Start Time||Chapter Title|
|1||00:00||This week on Founders Talk|
|3||03:08||Start the show!|
|4||03:51||Where do we begin?|
|5||11:55||Digging into Nylas|
|6||15:05||Does WorkOS flatten the market?|
|7||16:31||Box vs Dropbox|
|9||25:27||How do you position WorkOS?|
|10||27:38||Low hanging fruit integrations|
|11||33:13||Keeping in touch with customers|
|12||39:54||Is "Enterprise" boring?|
|13||44:14||PLG or sales-person driven?|
|14||50:25||Adam loves sales|
|15||57:55||Is Michael good at sales?|
|16||1:06:43||Giving up your Lego|
|17||1:14:26||Being content with where you are|
|20||1:40:33||Who can you emulate?|
|21||1:50:20||That was the best I could do|
|22||1:53:34||They like you Michael, hiring?|
|23||1:58:35||We've come along way from SAML|
Play the audio to listen along while you enjoy the transcript. 🎧
So, Michael Grinich… It’s been a bit, man. I met you I think last year sometime, was very excited to talk to you, and I was just a fan of this idea of enterprise-ready. I’m a big fan of you find a scrappy way to get somewhere, and then you’ve gotta grow. But then that path to grow is obviously hard, but does it have to be hard to do things that WorkOS brings to the table, is the question. You obviously say no, because you’ve made a way. One integration, enterprise-ready, there you go. And I like your hat too, by the way; your hat’s pretty awesome.
Thanks. We’ll have to get you one.
So where do we begin with this story? So obviously, WorkOS is beautiful, and amazing, but I think you’ve got a great design sense. Whoever’s doing that for you all, from the copy to the actual design - just stellar, stellar work, hands-down. But your journey didn’t begin here, obviously, because what journey would…? How do we tell the story to here? Where do we begin for you?
Yeah, it is sort of a weird story, because if you look at what we build, it’s like an enterprise API infrastructure thing for these protocols like SAML, and things that most developers don’t really know about, or don’t get drawn in towards. And people often ask me, “How did you stumble into building this company?” So yeah, it’s a good question. I think it starts a few years ago. Actually, over ten years ago, which feels like a lifetime ago.
When I was an undergrad in college at MIT, I met a bunch of the folks that were working at Dropbox early on. And this is when Dropbox was pretty small. They were like 50 people, or something. Dropbox was started by MIT alums. So they would come to campus, and come to the recruiting fair, and throw parties, and stuff like that… And I ended up spending about six months working at Dropbox, doing some mobile engineering there and building stuff. This is back in 2011. So the company was just starting to grow faster. I think when I went back to school, it had like doubled in size. And the thing I really thought about when I was there - it was not just the mobile app, but how Dropbox was getting used by companies, really businesses, and the positioning we had against other products like Box. We’d actually hired a sales guy from Box back then, and just started thinking about why is it like Box is winning in these business contexts when me and all my friends used Dropbox and it was clearly a better product.
So I thought about that a little bit, but obviously not too much. I went back to school, graduated, and then after graduating, I had been working on this email project. It was actually like my capstone project in the computer science department. So the codebase was there… And it was this thing to synchronize email and build data kind of visualizations on top of email. And I’d always wanted to build an email client. I felt like the email client is sort of the view into the database of your life. At MIT everything runs through email, and I was just like obsessed with email clients.
And so I started this company to try to rebuild Outlook or Gmail with a much more modern take. And to build something that’s really fast, and elegant, easy to use, and something hopefully that would help people communicate and get their job done a lot better. So I figured if you can help people communicate faster, help people kind of structure their thinking better, and help teams work better together, you have this huge effect on productivity, and it’s a high-leverage thing you can do.
So I started working on that, took that codebase, and that became the core of the mailsync engine, and then built this app on top of it. And we obsessed around the design. Really obsessed around the experience of this app. I spent like three weeks looking at fonts, just typefaces – because email’s all text, right? The interface has mostly fonts. Working with a couple designers that – I really, really loved that time working with them, on every single individual icon.
I hired a musician that did sounds for video games, and went to their studio for a couple days and just listened to like notification mail sounds that we were going to put in the app… Because the new mail notification sound you hear all the time. So we really went deep on this, right? Like we went really, really deep on making the experience great. We did all this amazing engineering to make it extremely performant on multiple devices. We had everything from MacBooks to like little Surface tablets, underpowered, that we were making sure it rendered properly, and worked offline.
So anyway, we obsessed around the design of this product. We launch it, and people love it. And it was also open source. So developers loved it, it became a top project on GitHub, and we got all these people signing up. And I had just gone through the Dropbox playbook, right? Build a great experience, that people really like, that’s really useful, put it out there in the world, and people will start using it at work, as well as their personal life.
[07:46] So we started getting users everywhere from like NASA, to Uber, to Facebook, to the city of Minneapolis… Every single kind of imaginable type of user was just downloading it, signing in and using it. And the playbook I had was like “Hey, do the same thing as Dropbox. Just go find the organizations that are adopting this and we’ll sell it to them.” It’s kind of the bottom-up freemium type of business model.
And what happened is a few years later, as we started getting this adoption, I would go in those companies, like Uber, for example, and say, “Hey, there’s 100 people here using Nylas mail. Let’s get you guys on a team plan. Let’s get you to pay for it for the whole organization.” And this was the first time I really learned about any of these things around enterprise features. I had never talked to like a person in IT before that, that type of moment. And what I realized is the same thing that was constraining Dropbox’s growth back then, I was starting to have as well, which is that you could get this amazing adoption and really product-market fit, with the end users signing up and using the product, and using it every day, in many cases… But when it came to actually commercializing and building a business around it, there was this totally different audience, which was the IT admin, or the procurement team, and they didn’t care anything about the design of it, or the fonts, or the sounds I’d put in it, or why users liked it. They pretty much said that they can’t use it unless it had all these seemingly obtuse enterprise features. And in some cases, some organizations actually shut it down. They didn’t know people were using it, and after they’ve learned about it, because it wasn’t enterprise-ready, they shut it down.
Ultimately, this meant we didn’t commercialize that product successfully. We got some people to pay for it, but it really wasn’t growing in that means… And we’ve found that “Hey, in order to actually build this enterprise stuff, it’s going to take an incredible amount of time.” And during that moment, I actually went and talked to friends of mine working at companies like Asana, or Slack early on, and they were all building this enterprise stuff. They’d kind of stopped working on the product features.
So we ended up just fully open sourcing it, shutting it down, pivoting the company… Nylas is still around, and doing well, and growing… But that idea of building a mail client essentially stopped. That died. And I took some time off, and when I was really trying to think about what to do next, I just kept coming back to this problem. I was like “Why did we build the product everyone loved it?” I still talk to people who say “I used that app, it was really great. I really loved it.” Why did we build the thing that everyone loved, but that wasn’t enough?
Paul Graham famously has written and said “Make something people want. If you do that, everything else will take care of itself.” And it obviously didn’t. There was this missing step. And I realized that getting product-market fit - it’s necessary, but it’s really not sufficient to building a business. And if you don’t think about the business side, you don’t really think about how you’re going to commercialize, and who is the buyer, you get stuck. And it might be in year one, it could be in year five… You might be able to squeeze through for a little while, but ultimately, you’ve got to figure out how to go to those actual commercial buyers and satisfy them.
And what I realized was – why WorkOS exists is all this stuff that you need, you can really put it into a software layer. And that’s what we’ve done. So things like authentication, and user management, security features, things like audit logging… All this kind of under-the-hood stuff that IT admins need - it’s pretty complex to build, it turns out. It takes a lot of time, you have to have really good engineers to do it… But the features at Dropbox that they ended up building for enterprise are the exact same stuff that Slack built, it’s the exact same stuff that Asana built. People just kept doing it again, and again, and again. And so I was like “Hey, what if I could take all these features and turn it into a product, kind of like Stripe, or something like that? …they’ve done that for payments, but let’s do it for enterprise stuff.” And that’s WorkOS. That’s the idea.
So I’m not clairvoyant, or anything, I just looked at the hard thing that everyone was doing, the hard thing that I had struggled to do at my first company, and then said, “Hey, let’s just kind of go a couple notches down the abstraction chain and solve this from an infrastructure perspective for everyone.” And it turns out we were so far not too wrong. People are using it, and it’s helping people… But I kind of stumbled into this world of infrastructure for enterprise apps really through building an app myself.
[11:53] Yeah. So Nylas - I do recognize you sweat the details on this email application. How, whenever you were examining – because you sweat those details, right? The sound, the typefaces, the look, the feel, the user experience… How when you were sweating those details do you think you gapped looking at how it would fit into commercializing? Why was the commercialization aspect of the product building process potentially an afterthought, based upon how you described it?
I think it’s a it’s a situation that a lot of founders get stuck in, honestly. And the reason why is I wasn’t like hanging out with IT admins. I hadn’t worked as like an enterprise IT admin. I didn’t have anyone in my network that was like a Chief Information Officer at a public company, or something like that. And so I really wasn’t familiar with how software gets managed or deployed in organizations with hundreds or thousands of people. I had never worked in a company that large. And I was just building for myself and for people that I knew; other users that cared about the design, and cared about craft, and quality, speed, functionality… The open source nature of it - that was a big selling point. You could build extensions on top of the email client… Which is really cool if you write code and you’re kind of a geek around extending your productivity apps. But when it came to IT, they needed stuff around automatic provisioning of users; it saved hundreds of people in the company that can’t just go in and click Approve, or Invite inside some dashboard. They wanted to sync it with their directory system. And those were problems I’d never really seen, and I didn’t have like friends in those types of jobs, or exposure to that. I think it happens really commonly. If you look at pretty much every single productivity app that gets built, at some point they grow, grow, grow, and then their growth is gonna get stalled out, because it can’t really go punch above their weight class in these bigger companies. Some of it is cultural, some of it is sales motion, some of it is pricing, some of it is these enterprise features… But there’s this gap.
I gave a talk on this a few years ago called “Crossing the enterprise chasm.” It’s like all about this change that companies need to go through as they go up market and commercialize. Some of it is technology. That’s what we help people with, and provide, but it’s kind of a different mindset. And the change that happens is the user that was using the product is no longer the buyer. My friend who runs product at Airtable talks about this, the user versus the chooser. The chooser is the one that gets to actually write the check, and control the budget. When you’re selling to individuals or small companies, that’s the same person. They put in a credit card, they just choose to use it. But if you’re selling to Disney, or the New York Times, or something, there’s going to be a different chooser, and they’ve think about security, and administration, and all this other stuff, and they care less about the typefaces. I can tell you they care less about the design. And that’s why a lot of these big companies, you look at the stuff they use and you’re like “Ugh… I can’t imagine why they would pick to use this really lousy issue tracker. Why are they using this garbage?” It’s not because they like it, it’s because it satisfies all the requirements across the board, and that’s the priority of the person that’s actually signing the check, at the end of the day.
Is this like a market-leveler then, basically? Like, that you could be an early company, someone who does not have the engineering staff to build out these features, but you kind of get the Get Out of Jail Free card. I’m trying to find the analogy… Something that gets you past the gate, sooner, faster, better, easier, because if you could just simply integrate in one place, it seems like that’s the magic bullet, right?
I was talking with someone once who kind of described what we do at WorkOS as like arming the rebels…
You know, the next generation of software companies, helping them be able to go and compete with bigger organizations, helping them go at market faster… And I think there’s a future where this could be possible. I think if we do our job right, at some point you’ll be able to have a three or four-person like Y Combinator company, who can go sell to Goldman Sachs… Even in the regulated industries, because they don’t have to think about all this enterprise stuff along the way; it just plugs in.
[16:04] It’s not totally possible today… Occasionally, things like that happen, but I like to think about this as kind of like democratizing access to technology… And yeah, making it equal access is another way that we’ve described it. So it’s not just the big companies that can go after it. It can also be startups, or entrepreneurs, or honestly, just a person in a coffeeshop, hacking on something; you should be able to build that and get it into the hands of people that want to use it.
Yeah. You mentioned Box earlier, versus Dropbox. And we’ve collaborated with Apple a couple of times, via – you know, we produce podcasts; they have podcast indexes, and clients, and stuff like that. They do podcasts. And in our collaboration with them, when we had to like exchange large files and stuff like that, it was always through Box. It was never through Dropbox. And I can imagine it’s probably why Dropbox always seemed to be positioned towards that. Now, are they a WorkOS customer, was WorkOS around whenever that came around? Are they maybe now? But it seems like they probably built those features on their own, which means they read the documentation to these obscure, hard to understand technologies, like Scheme, and different stuff like that… [unintelligible 00:17:13.15] isn’t it?
There’s a lot of acronyms… It’s a world of four-letter acronyms pretty much everywhere you look in the enterprise.
I bet it. Well, yeah, enterprise tends to have that kind of thing, for whatever reason. SSO, single sign-on. Whatever. A bunch of different stuff. But they didn’t necessarily lose or win. Dropbox is still around and kicking butt. I use Dropbox every single day. Now, we’re not an enterprise, so I didn’t concern myself with how easily can I sign up 1,000 users to this service, because that’s not my problem. I’m the user and the chooser, as you said before. In the case of Box though - it seemed like in the case of Apple, Apple gave them their business, you know?
I’m assuming it’s probably because they had certain enterprise features. Now, they probably built those features themselves. The issue, I think, and I want to get at though, is this pause that I think you said before, which is like when you’re sort of getting to product-market fit, and you’re kicking butt, and you’re acquiring users, and then you kind of get to that threshold of like you can’t go above a certain threshold, what has to happen essentially is you pause on featureset and you essentially say, “Okay, well, let’s build out these things that aren’t really product, that make our product be able to be usable by certain organizations.” Can you speak to that sort of, essentially, a distraction from product?
It’s a really tough spot to be for companies. You work so hard to get product-market fit, through focusing on the product features and experiences itself - design, the onboarding, the sharing abilities, things like that… Maybe collaboration features, real-timeness… So whatever is kind of the unique secret sauce that brings people in. And then at some point, you have a big customer saying, “Hey, we want to use this everywhere in our organization. We just need you to build this thing that every single other enterprise app we have has this feature.” And it could be as simple as like single sign-on. That’s the one that a lot of people hear about first, right? Like, “Sign in through Okta. We can’t sign in through passwords to this thing, because it’s not secure.” It’s pretty tough in that moment to figure out where to put your focus. Because most companies - now, I’ve been there myself; if you’re the entrepreneur or the product leader, you’re just now at the moment where you can start doing the really interesting stuff. You can start really building the platform you want, or building the most powerful version of the product, and suddenly now you have to get pulled away to do this enterprise garbage that your team doesn’t want to do. You haven’t hired designers that were super-excited to build the audit log in your product… It’s a distraction, in a way, but it also is really, really necessary for company growth.
In the case of Dropbox, they eventually did it. Dropbox Enterprise today is an awesome product; it’s being used by thousands and thousands of companies. But in the early days, in a moment, and probably when Apple decided to use Box - because these contracts stick around on for a while…
Yeah, multiple years.
[20:00] …Box probably had those features. They probably had features around – I’ll just give you like one example. So if you’re using a tool online, and you’re using it with potential customer data, or just even your company data, and you get sued. Like, anyone sues you. Any sort of lawsuit. Doesn’t matter if it’s like frivolous or legit, right? Someone sues you. You need to have something called data retention around this. And this means that you kind of keep a record of everything that’s said, or files that are shared within the company, because if you don’t, if you’re deleting stuff, and that suit goes to trial or anything, they can say “Hey, you were deleting evidence. There’s evidence that’s no longer here.” And so you’ve just got to hold on to stuff.
So this is a feature inside of like corporate Gmail, where they can just say, “Hey, save everything that has says this word, or has this name in it. Just in case.” And that’s called legal holds; it’s used for e-discovery if it goes to trial. If you don’t have this feature, it doesn’t matter how shiny your pixels are, or like how great your collaboration is; it doesn’t matter. These companies can’t use it, because the liability of that from a legal side is so high. So, so high. And that’s just an – it’s not that hard of a thing to build, right? It’s just kind of export it, you just have to save it to sometimes S3, or have another database table… But it’s not just that one feature. There’s a bunch of things like that. And I can tell you, the folks that were working on Dropbox back 10 years ago, they weren’t thinking about e-discovery, or legal holds. They were thinking about how to make the mobile app really great for like sharing photos, which is what they were hearing from users.
So that IT group - it’s a small group, it’s a small number of people, but they have a lot of power and sort of a big voice within companies… And companies reach this point, and startups reach this point where they have to make a decision one way or the other. And my hope with WorkOS is that we can help push that off a little bit, keep working on cool product features for our users, just use our stuff instead.
But even from the perspective of like building a marketing team, or a sales team, or thinking about enterprise, the companies that don’t do it, unfortunately, long-term they don’t succeed. They kind of flame out or sell out. Whereas the companies that do embrace it and figure out that balance end up doing really well. But it is a really big tension between – you know, you’ll usually have like your VP of product and your VP of sales kind of screaming at each other, being like “We have to have this feature.” “No, we should build this thing.” And I think the hard thing as a company leader is trying to figure out where’s the middle ground between those, and where are you going to allocate resources.
So, do you position work less as a featureset for enterprise applications, is it an enterprise enablement for scrappy startups? Who uses WorkOS, who should we use WorkOS? Is it like a “Everybody should use it, and you should never write these features yourself”? Obviously, you’re probably biased, because - well, we know where you work, and we know what you do… But give me a – as close to the ground as possible.
Yeah, everybody should use it, and pay for it in triplicate, of course… [laughs]
No, I think the right audience is people – earliest is really after you get product-market fit. So you don’t need WorkOS when you’re just trying to figure out what features to build. And product-market fit isn’t like a single point in time; it’s kind of a spectrum as to when it starts to happen… But I would say, for folks building product, as soon as you start feeling that pull into maybe slightly larger organizations, or interest, and you really want to go sell to a company like that.
For example, we have a customer who hasn’t even launched publicly, still an invite, and they have a bunch of like SMBs and startups using it, and then Airbnb wanted to use their product, the team there. And so suddenly, now they have to go through Airbnb’s IT team. And they’re not thinking about enterprise yet, the startup; they’re just getting going. But that’s essentially an enterprise customer. And by adding somebody like WorkOS into it, they can smooth over a lot of those requirements, and hopefully close them as a deal.
We also work with much larger companies, like companies who don’t want to maintain this stuff, and want to keep expanding. But I would say the earliest – sometimes people think the brand new YC startup should use WorkOS… And today, that’s not really the case. People, I would say, use it after product-market fit. But not too long after. Usually, as you get those first few bites from potential enterprise customers, you can plug in our stuff and go sell more of them. It ends up really accelerating businesses, which is a cool thing to do.
What’s the low-hanging fruit in terms of integrations? I know you said single sign-on before… So obviously, if you need to authenticate with Auth0, or Okta, or some of the well-known providers out there… I think Google’s even one of them, just because they’re obviously part of that… I think Apple might even be single sign-on now, where you can actually sign in through – I don’t know if that’s an integration or not, but somehow you can sign in through these ways. But I often see Okta, Auth0, Google… Those are the ones I see often. And I think even GitHub now; at least that’s how I sign into Tailscale; so that’s like a version of single sign on.
[28:13] So what are some of the low-hanging fruit in terms of - you’ve got product market fit; what are some of the earliest features that you enable, that can make your enterprise-ready? Obviously, single sign-on, directory syncing… What are some of those features?
Yeah, single sign-on is the first one. And specifically, authenticating with SAML-based identity systems. So the things you were mentioning around signing in with GitHub, or signing in with your Google account - these are often kind of social login experiences, or individual logins… So just kind of click your GitHub account, and then you get added to the team. But if you go sell to – I’m trying to find an example… Like Uber, for example; they have an identity system internally that they’re using as their corporate login, and they want to manage who has access to what, and who’s signing in from which device, essentially. There’s a lot of different things that these enterprise identity systems allow you to configure and manage.
And so they’ll say, “Hey, we don’t want you to sign in through GitHub anymore. We want you to sign in through Okta. Or like Azure AD, Azure Active Directory. Or this custom-built SAML system that we have. Or this thing from VMware, or CyberArk.” There’s all these different systems out there. But usually, the way people log in is kind of the first enterprise requirement that you’ve got to add.
Around that time also, sometimes they’ll ask about kind of compliance and security at the company. People often adopt WorkOS around the same time they start thinking about SOC2 compliance. So we don’t help companies with SOC2 compliance. There’s a bunch of products out there, like Vanta, or Drata, or Secureframe, which do this really well… But it’s around the same time. So usually, companies need to start thinking about their security policy, and positioning. Usually they don’t need to get it done-done, because it takes about a year for the compliance stuff to go through, but they’ll start asking for that, too.
And then the third thing companies will ask for usually is a thing for user management - automatic provisioning and deep provisioning. Because if you can imagine a company like Uber, that has hundreds, or I guess thousands of employees now, they’re not going to manually add or remove users. They want to connect it with their directory system, so when someone gets hired, they get access, when they leave the company, it’s removed… So they need to tie it into their directory system. And that could be like a payroll system, or some user database somewhere… And so a lot of the stuff is around connecting to their systems and really creating automation for companies. And that results in a more secure platform, and easier for them to manage.
Those are just a few of them. If you want to see the whole list, it’s actually pretty easy to figure out; just go look at what’s in Slack Enterprise, what’s in Dropbox Enterprise, what’s in Asana Enterprise. You’ll look at those bullet points on the pricing page, and they’ll pretty much be the same across different products. And those are all the things we’re building. That’s our roadmap. If you just go look at what do you get in Asana Enterprise, those are things that we hope to build, so developers don’t have to build them themselves. We can just put them into a platform.
Right. Essentially, this is the ultimate way to not have to build these features yourself. I think even whenever you got your initial funding, it was like “We’re the Stripe for X.” [unintelligible 00:31:07.07] you can say “I’m the Stripe for X.” It’s usually ambitious, and potentially a good idea, because Stripe is a pretty good idea, but…
Yeah, they’ve done all right…
Yeah, they’ve done pretty good.
They’ve done pretty well. I mean, they’re a huge inspiration to us, in terms of their – also, I think I share a lot of similar sentiment around the focus on design, and brand, and experience, and like really building for developers… Even though what we’re building is enterprise infrastructure stuff, how can we make it super-easy to integrate, and really build for that single developer with their hands on the keyboard? Make it really easy to get started, and make it easy to just put in a credit card and get your API keys. We would love to try to do for the world of enterprise IT what Stripe has really done for payments, and building those economic rails for companies.
[31:54] It’s something that worked out for everybody else, too. I think being able to easily transact is a great thing on the internet; it was challenging. PayPal was there… It’s still challenging with PayPal… There’s a lot of politics around who you choose, and who you use, or whatnot, when it comes to taking payments… But certainly – I mean, I can recall the early days of the Internet, when it was like “How in the world do you take payments online? I’ve gotta talk to my bank, I’ve gotta do this, I’ve gotta do that.” It’s like all these hoops you’ve gotta jump through, when Stripe really democratized essentially an API, a payment API, and they made it pretty easy, which I think is just a magical thing.
One of the cool things about Stripe I’ve always thought is they’re with you when you kind of get your first customer. You integrate Stripe, you’re building your product and business, and they’re right there with you when you kind of get that first charge that comes through, and you get notified… “Okay, now I have a user, a customer.” We do something kind of similar for enterprise users, for companies. Often, people will integrate WorkOS, and then the next week they’ll get their first big logo. And it’s pretty cool. It’s like really this transformation moment for companies. We get to see it happen again, and again, and again… And usually, when companies get that, it’s not the only one that’s going to happen down the line. To give you an example - Webflow is a customer of ours; we’ve been working with them for a couple years, and their business has grown tremendously during that time. It’s been so cool to be like a really small part of that, that grows with them.
How do you keep in touch with customers? Either you yourself as CEO and founder, or just corporately as a company. How do you maintain that relationship with customers?
That’s a great question. A whole bunch of different ways. One thing that we have is a change log that we publish, and we put a lot of stuff into that. We ship stuff really, really fast. And so that’s a really good way for people just to follow along what we’ve been building and shipping, week by week. Things move pretty fast.
I also spend quite a bit of time talking to people over Twitter. I find that a lot of developers are on Twitter; not the enterprise IT guys necessarily, but people who are like building stuff, thinking about products, a lot of entrepreneurs and founders are on Twitter… And Hacker News as well. That’s where we launched WorkOS, actually, early on, during the pandemic.
Is that right?
Yeah, yeah. We launched in like March of 2020; kind of one of the weirdest times for launching a new startup. And then I think lastly, we do it through Slack. So we have today several hundred shared Slack channels with other companies. And through those we can – we actually give support through slack, we have a bunch of bot stuff, and alerting… If you use WorkOS and you have a connected Slack channel, it’s a pretty awesome experience, actually. It’s always automation built into it. But it’s also a really easy way for those people to talk to me, or the team. And I’ll pretty regularly have founders or other CEOs DM me and say, “Hey, I’m closing my first enterprise deal, and we’re really excited, but they’re asking for this weird stuff in the sales agreement. What should I do?” And I’ve seen so many examples of this. I can be like “Oh yeah, that’s pretty standard.” Or “This one’s pretty weird.”
I recently had a founder ask me – they were talking about a customer, and the customer wanted access to their financials… And I was like “No, you don’t do that. You don’t give someone like a customer your P&L.” But another one was asking for like a multi-year discount agreement, with a discounts. I was like “Oh, yeah. That’s super-common. Here’s percentage-wise roughly usually what people give.”
So it’s not just talking with customers of ours. I feel like it’s actually just engaging with the wider kind of startup community. Oh, and the last thing is like a lot of stuff’s still in-person. I live in San Francisco, and despite the rumors of the death of the city, I think it’s still a hot –
Is it still thriving?
I think it’s pumping. I think it’s doing great. Yeah, even in the past couple months, there’s been a lot of events, and it really feels like it’s recharged in a big way. So it’ll be a good summer, a good spring and summer.
Yeah. Anytime there’s big change, that can sometimes bring big change, and what better way to embrace big change in your life than to announce somebody else’s big change, which is “Hey, SF isn’t a fun place anymore. It’s gone downhill” or whatever. And then obviously, there’s a [unintelligible 00:35:50.07]
I think maybe all the people that didn’t want to work very hard all went to Miami… Or New York, I don’t know. They wanted to go hang out. I think the people that are still here are definitely grinding builders. It’s pretty galvanizing, I would say, right now.
But that’s just me throwing shade at those two places… I love New York.
[36:09] For sure. Well, you’ve got some shade thrown your way, so… It’s owed. It’s owed. We’ll allow it. How do you find the joy, I suppose, in what you do? I mean, obviously, you get to help people get their first customer, maybe navigate some weird language in contracts, things like that… But for you personally, what’s the joy? What makes you get up every single day and find this seemingly – I don’t want to say mundane or boring by any means, but it’s definitely… It’s not what I would imagine the funnest thing to do ever. It’s like something you want to do once, and never do it again. And you kind of enable that for a lot of people. It’s not the funnest thing to work on. How do you find fun? Or is it super-fun to you, and you’re just a unique person?
I think it is pretty fun, yeah. I mean, so far. It’s an interesting question. There’s different levels to it, I think, as to why it’s enjoyable or fun. I would say it’s not always fun. It definitely is work. And I think one of the hard things actually about being a founder and an entrepreneur is you don’t ever get to go do the things you’re good at. As soon as you get somewhat decent good at something, you go hire someone to go do it at the company. And so you’re constantly in the state of just trying to piece it together, and kind of wing it, until it’s in a place – for example, we just hired our first salesperson at WorkOS, literally last week. I’ve been doing otherwise.
Is that right?
So I’ve been driving forward sales, and doing that – I’ve been doing sales. And I’m not like an expert sales, a VP of sales person… But I’ve sort of figured out how to do it for our type of business, and for what we needed. But I don’t get to continue to do it to the point of mastery. I hand it over to someone when it’s just kind of put together in a way. And I don’t write code and build stuff anymore, at least on the production service. We hire a lot of other people to do that, and build stuff.
And so you have to love the process, I think, of like constantly handing over your Legos, giving away your Legos to other people… And the job for me is actually somewhat the WorkOS his product, what we’re going to build there, but actually for me it’s building the company. It’s kind of like building the machine that builds the machine. How should we think about sales and marketing? What should our strategy there be? What does it mean to build a design culture that’s really technical? That’s a hard thing for us; we’re designing software, not just kind of consumer products. There’s so many questions and levels to it that the job feels really different every couple of months, honestly.
And then I think the other counterpoint here is I just really like building tools and platforms for people. There’s a certain kind of satisfaction from creating something and giving it to someone else, and then it enables them to create another thing, that you could have never thought of, or you would have never built yourself. It’s a very high-leverage thing to do.
My favorite product, I think of all time, is actually AWS. Not because I think it’s particularly well built or well designed, but the impact that AWS has had, the amount of leverage that it’s given people is astounding. There’s businesses that exist because of AWS, that would have never been built or never been even started in the first place. And so we’re doing that a little bit with WorkOS; we’re able to kind of give people that leverage to expand their business, and grow. But I don’t know, I kind of like working on infrastructure things that are sort of in the sidelines.
I guess, kind of backstage… Sometimes I use the analogy of like - WorkOS, and the people we hire at the company, and all that, we’re not really the people on stage, with the spotlight on them, singing the Prima Donna. We’re kind of like the people that run the soundboard; that are supporting the opening act, or supporting the main act… But without this, you can’t put on that kind of a show. But it’s not necessarily the thing that’s drawing the most attention. And we find that so really satisfying to do, that type of work, enabling other people.
Yeah, by no means was I trying to downplay the level, but you have to admit that enterprise tends to bring this – or even the word, it’s kind of like “Boring…” Now that I’m even saying that, there’s that stigma out there. And I think you have to address this; and I think you addressed it perfectly, which is as a founder, your job is constantly changing.
[40:20] I love example you gave there, which is like as soon as you get good at it, you essentially hand it over to somebody else, or you try to. And if you’re not, then you’re probably not growing. And that is kind of surprising… I didn’t expect you to say that, that you just hired your first salesperson. One, that’s awesome, but two, that means that it’s a maturity thing too, because you don’t have to keep holding the revenue opportunity of your business. It’s kind of easier, it would be easy for you just to keep it, and never hand it off to somebody else, to sort of just maintain it. But you wouldn’t get to build the company if you were only running sales, which is one of many aspects, but also a very key aspect.
Now, I imagine, as you pull yourself out of that role, you’ll still keep playing a role in that process, but not the role that drives it forward every single day. You’re thinking about, as you said, how do you market, how do you find advantages, how do you gain new customers, how do you, attract the right kind of people, how do you tell your story better? …which I think you do a great job of. I’m just – I can totally tell you appreciate the aesthetics, right? You can’t go to your website and not see that you just sweat the details. Because there’s just so much detail in there, that – it’s just very, very well done. So I appreciate that.
Well, thanks. That’s really a characteristic I think of me and the team, honestly… Because the product that we’re building, it would still work without all the effort we put into our design, or thinking about the quality of the craft around what we do. I think it’s hard for us to build stuff or work on stuff without holding that bar. For me at least, I’ve always had a really hard time half-assing something. I just can’t really do it. It’s like either all-in or not. I think that’s even the case with doing a startup. A friend of mine described startups as the extreme sports of business. [laughs]
Which is funny for me, because I love skiing, and like riding motorcycles, and surfing. [unintelligible 00:42:16.17] all this kind of silly extreme sports stuff, but I think that startups - it’s kind of the most extreme, because you’re always kind of at the edge, and it’s always changing a little bit as the company grows and evolves. And yeah, as you were describing, reflecting back to me, this - doing kind of all the jobs and handing things away… The thing that popped into my head, it’s like, imagine that you’re wanting to open a restaurant, and it’s just you when you get started. And so what do you do? Someone comes to the front door, they say, “Hey, I’m ready to eat at Joe’s pizza shop.” And you’re the host, you walk them in, you sit them down, and then you get them water, and then you say “What would you like to eat?” and then you get the order, and then you run back to the kitchen and you start cooking as fast as you can.
And you cook it, and you put it on the plates and come bring it out, as if you were like at a dinner party at your house, or something. And then over time, you get more people coming in and you’re like “Gosh, now I need someone that’s going to be at the front door, because the second person came in and I was in the kitchen. Someone’s got to say hi to them.” And “Well, now I need a few more tables. And maybe I should prepare some of this stuff beforehand, so it’s faster etc.” Then you start to specializing and breaking in all these different roles that are kind of the dance of actually being a restaurant. But the process for doing that as a startup is not just build the end state; you have to go through all these like messy transition moments, where maybe at some point the maitre d’ is actually making the dough in the back at some point at your pizza shop. And that’s, I think, both the hard thing as being a company founder, but also kind of the cool thing, is that you’ve got to have your hands in everything.
And this is not just the founder thing; this is actually joining early-stage startups. You might join as an engineer, but it turns out you have to think like a PM, or actually open up Figma and start doing some design work. Or God forbid, go talk to customers, right?
[43:58] Certainly, at WorkOS, we have people do like everything under the sun. People have really flexible jobs… And I think that’s – for some people, they don’t like that. For other people, they can’t imagine working any other way. It’s kind of the most rewarding, and also kind of like the environment in which they thrive.
In terms of your sales cycles, is some of your product self-serve? Or is a lot of it long cycles, where it does take a sales process, many meetings, many agreements? How does it work for you all.
So WorkOS is designed so that anybody can just go sign up, get an API key, integrate, go do it all on your own, without having to talk to anyone. So if you wanted to go add SSL to your app today, you can literally sign up and you’d be off to the races. And it’s really fast to integrate, too; so you don’t have to talk to anyone.
We find that a lot of developers do have questions. And when they do have questions, they can be a variety of different topics, and they want to talk to somebody technical. And so the first step that we introduced is something called our Developers Success team. Developers Success engineering. And these are really technical people, that are just there to answer questions and help people integrate and use the product and succeed. And it’s not just the integration, it’s actually later on down the line too, when you do different things with it, or add customers.
So these are the first group of people that folks usually talk to. They say, “Hey, I have a question about your API in this way.” Or “My app is built using this framework. Do you have an Elixir SDK? Let’s talk about that.” That sort of ends up being pre-sales for a lot of companies, in a way. And then you put in the credit card and you go, later on.
For relatively small companies, say, I don’t know, under 30 or 40 employees, usually they just do that; they just get started. They might have questions around pricing, or kind of want to talk about security, but it’s not really a big sales process. They’re just plugging it in.
It’s a bit different for bigger organizations. If you’re a company with let’s say like 2,000 employees, there’s going to be many other stakeholders from a security perspective, the financial side, or on what the business contract is going to be… Maybe they’re going to budget a lot more for it, or they want to see if it works in production with a customer first, like do a proof of concept… If they’re using a lot of capacity, they’re probably not just going to put it on a credit card. They might want to pay for it through other means, or like a purchase order (PO).
So the way that those bigger companies buy software is just a lot more complicated. And you might need to talk to the head of engineering, and head of product, and maybe the head of security, and then engineers that build the stuff, and then the support people have questions… So there’s just many other people that need to get around the table to know what’s going on. That ends up leading to a longer sales process, because you have to talk to more folks, right? But the upside is they’re going to have a bigger contract, right? They’re gonna use more of it out of the gate.
So who are the people that go do those conversations? Who are the people that talk to that company, and they say, “Hey, here’s the 12 people that are sort of weighing in on this decision, and they all play a different part. They’re kind of playing different instruments in the orchestra.” How do we map those out and make sure we talk to everyone and just get them all the information they need, so they can make an informed decision? And that might be pricing, that could be functionality and features, it could be security. It turns out the people who do that, their job is called sales. That’s what those folks do.
Thanks for clarifying.
Yeah, you’ve heard of them. If you derive the role of a salesperson, for first principles, this is what it is; their job is to help communicate not just the value of the product, but actually help the customer succeed in it, in a way. It’s not just to extract the most money possible, it’s not just to force people to get on calls, or catch up, or eat steak dinners and play golf… It’s actually to help them succeed with it. Because if you’re not providing value to them, and they don’t really understand what the value is, it’s not going to work. Businesses are kind of these organic creatures that will stop doing things that don’t benefit them. And so the job of sales is really to create that cohesion and that alignment. And sometimes that’s through relationship building, but oftentimes that’s actually through explaining the technology and helping them integrate it in different ways. And we have a really interesting characteristic with WorkOS, where companies will start using it when they’re really small, and it’s like a child; like, you blink, and 18 months later they’ve like quadrupled in size, and it’s a different organization, and some people have left, and it feels like a different company.
[48:08] We actually almost go back and resell the companies. Like, do the sales process again. Like “Hey, I know you guys are already paying for this, but let’s make sure that you know what the value is that you’re getting out of it.” Because the decision-maker actually went to this other company now, and “We think we’re providing a lot of value to you, but we just want to make sure everyone’s on the same page here.” And that can be a long sales cycle.
I think in some ways with SaaS products, when you’re paying for it month over month, and it’s like a service, sales never ends, because their business is evolving and changing, and so is WorkOS. We last summer shipped - end of summer, early fall - we shipped a brand new product around audit logging. And it’s this really cool, enterprise-grade audit logging. Now I’m gonna nerd out, get in the weeds, but it’s like the Ferrari of audit logs. Like, the thing is awesome. It has all these integrations, and we built it with Vercel as a design partner. This is actually powering Vercel’s audit log experience. And Vercel was already using WorkOS single sign-on and directory sync. So our sales process - you know, of think “What it sales?” Well, it’s actually just working deeper and deeper with customers, and trying to power more of their business, so Vercel can keep working on Next.js and all this other stuff that really makes Vercel special. But if they don’t have that audit log, they’re not gonna be able to go sell to - whoever; Kellogg’s, or these big companies.
Nike, yeah. There you go.
One of their famous customers is Nike.
Yeah, yeah. And it almost becomes a partnership in that way. It’s like, you do the things you’re really good at, we’ll do the things we’re good at. We keep working together. And actually, the coolest part for me about sales is when, in that conversation, you’re kind of “What else can we do together?” Like, “We’ve gotten these two or three things together, and like clearly it’s working for both of us. What’s the next level we could take it to?” And you asked about what wakes me up in the morning and kind of gets me driving… That’s one of the coolest things; like, our customers are not these like big, stodgy, old, slow-moving enterprise, whatever companies. We work with the fastest-growing, most innovative technology companies, that are just like rocket ships going into market, and we try to keep pace with all of them. And those are the people we get to collaborate with and work with.
Yeah, for sure.
So I actually think sales in that dimension is pretty cool. It’s very different. And it’s not just like paperwork, and golf games, and…
Sure. Steak dinners, and stuff…
…steak knives, or whatever, gifts and stuff like that. Yeah.
As you were describing, I’m thinking like “Gosh, this is getting me excited”, because I don’t know if you know this, Michael, but I love sales. It’s one of my favorite things, honestly. I do sales for us… And our sales is simply a lot of the ways you described it, which is “How can we help you speak to our audience in a way that makes a lot of sense, helps you get their attention, but doesn’t just tell them what you do, but who you are?”
I find that – I think it was a couple years back, I just sort of stumbled on this reasoning, essentially… I don’t want to say I coined the phrase; I haven’t heard it anywhere else, but “Facts tell, and stories sell.” So we can just easily be fact tellers for brands in the dev space. Very easily. That’s kind of boring to me, just to go to your homepage and read off that WorkOS makes sure you’re business enterprise-ready, go buy it today, get your coupon code here… That’s kind of boring to me. And so we always kind of stumbled into this story, “Stories sell”, rather than “Facts tell.”
There’s this thing that came to my mind… I remember I was talking with someone once about kind of brand, and storytelling around sales; like, actually kind of what you’re selling. And we were talking about like - you go to Home Depot, and you’re like “I need a drill. A drill with a drill bit”, you know? And maybe that’s the thing that DEWALT is selling you, like is the drill itself. But actually, what you’re buying is a hole.
You’re buying the hole in the wall. That’s what you want.
The possibility of a hole.
The possibility of a hole, right?
You don’t need a drill, you need a hole in the wall.
Maybe the wrong size, Michael.
Yeah… [laughs] Well, that’s an exercise left to the reader.
But that idea of like it’s the impact that you’re driving; it’s not actually the thing that you’re buying to get there. For example, if you look at like car companies, you look at the ads for it, it’s not necessarily about what are the specific features of the car…
Yeah, exactly. You watch like a commercial for Ford, it’s not that, at the F150. It’s like “You’re going to use this to like tow a boat. You’re going to use this to throw mountain bikes in the back. You’re going to use this to go skiing, or like build a house” or whatever. It’s a tool that’s used for those things, and they show you those; they don’t tell you that’s what you’re going to do with it.
I think that’s one of the hardest things for sales, is actually that storytelling, and connecting it back to the impact that it has for companies. And if you can do that – I honestly think for most entrepreneurs, they don’t even think sales is like this, because they’ve met with so many bad salespeople. That’s the thing, is there’s so many bad salespeople in the world.
Right. They bought too many cars.
Yeah, exactly. But if you can kind of actually reframe it around the impact that you’re having for that customer, like “What would their alternatives be? How valuable is it to them to have payments solved for them (in the case of Stripe)? What else could you have those engineers go build, and start building your invoicing system?” You start actually speaking their language, and then it creates that cohesion… And then the sale, the contract you put together or whatever - it kind of just takes care of itself at that point.
Yeah, it does. It’s like “Well, just give me the thing so I can take care of it, because we need to get going here.” Like, you’ve both got your own inertia into the goal. You know, this is so foreign thought; not a lot of people talk like you do, Michael, about sales. So how did you – I mean, you sweat the details, clearly, but how did you become this wise about sales? Did you just fail a lot and learn, or did you succeed a lot and learn? How did you get this wisdom?
Well, I don’t know if I’m that successful at it, I would argue… I mean, I’m still learning a tremendous amount. I think that’s why this job is kind of fun. For probably a lot of people listening to this, other founders have a kind of attraction to it… Like, the highs are really high, the lows are really low, and success is not guaranteed, but the thing you can definitely guarantee is you’re going to learn, a lot. You’re going to be in a different type of environment.
I think for me, after that first company experience, I focused so much in that company around the technology and product and design of it, and I didn’t really think through the business model itself. Like, I had thought about it some, but not really down to the core, down to the first principles, and how it would engage with the rest of everything, to create harmony between the go-to-market side, and actually the product side. And when I was trying to think about a second company to do, what I realized was this was a gap I hadn’t thought about. I have a lot less intuition in it. And certainly in starting another company, I wanted to make it also really successful, and I was like “If I can figure out a way to put these two things together, it’ll be like supercharging it.”
And so I really just became a pretty deep student of SaaS, and sales, and I talked a lot of different people. I’ve probably talked to thousands of people on the go-to-market side, to figure out what are the underlying truths, and what is my version of sales. I remember I was hanging out with a friend of mine, who’s a bit older than me, and has been a mentor… And this is right as I was getting WorkOS started… And I was confiding in him, like “Look, I’m kind of the MIT CS guy. I’m not a sales guy. How am I going to be able to build a sales team? I need to figure out how to sell, and I don’t know if I can do this.” Even as a CS student sometimes you’re taught like “You won’t be able to figure out business”, or whatever. And he looked at me and he was like “You know, Michael, you’ve been doing sales all along. If you’re hiring people, if you’re raising money, if you’re leading a company like that, you are doing sales, day in, day out. What you need to figure out is what is the version of sales that’s true to you, and how you think about the world, and amplify that. And if you can figure out how to do that, then – you also need to learn technique, and skills, and there’s always different methodologies for it, in the same way there’s like agile for programming, and different ways of software architecture design… But that’s stuff you can read them books. But I think at the core of it, if you can hire someone, if you can convince them to quit their job, and kind of run with you in a battle on some crazy idea, you’re essentially doing sales.”
[56:20] And for me, that’s been an experience of learning from a lot of different people around how they do it, and then honestly, a lot of trial and error. I’m very thankful to all of our early customers that bared with me as I figured out how to structure contracts, and work with them, and very thankful that they trusted us to through that process, that we could figure a few things out. But I think a big part of it is just being curious and being willing to be wrong and learn. I still think I have a long way to go, personally.
That’s phenomenal advice right there, man… Be curious, and be willing to be wrong, and to learn. That right there is like – print it on a T-shirt and wear it all day long, man. That’s good stuff right there.
It’s funny, those are actually – I’m just rattling those off – those are actually a few of the culture pillars we have at WorkOS as a company. One of the things we look for when we look for people to hire is like people that are curious. Because I think when companies are changing, and evolving really quickly, you can’t just go do what other companies do. You have to really try to understand why. You know, like little kids, that are like “Why? Why? Why? Why is the sky blue? Why is the grass green?”
“Because I said so, man…!”
“Because I said so”, you know, but they just keep asking it, and they’re not satisfied. They’re like “I need to know why.” And it’s like “Oh, it’s Rayleigh scattering in the upper atmostphere And they’re like “What’s that?” And then you start telling him about physics. But I think it’s a really important thing when you need to build stuff, in terms of the whole company; not just the product, but like your methodology, step by step, through first principles… And it’s a harder way to think; it takes a lot of effort, and can be really frustrating, but it’s also really satisfying and rewarding.
Yeah, okay… So would you consider – I’m not trying to ask you to say that you’re an expert by any means, but at what level do you feel like you sell? Do you feel like you’re amazing at it? And what do you think – do you just approach new conversations as… I guess what’s your style? Do you go in and ask a bunch of questions? Do you say what are we doing here…? How do you work?
Yeah. I think sales is mostly asking questions. I had a couple of people from my team shadow a couple of calls I did, and one of them – it was like half an hour call, and he was like “You spent 27 minutes asking questions. You didn’t say anything about our product. What’s up?!”
But the questions I’m asking are around why are they going to find the product useful? If you have a customer reach out, a potential customer get on a call, you can be like – I literally say to them, “Why are we here today? What do you guys want? What do you guys need? What problem are you having today?” And sort of have them articulate it. And in the case of WorkOS, they’ll be like “Oh, we have this big customer that came to us and they said they needed X feature, and we don’t really know too much about it, or how to build it. And I saw that you guys maybe can solve this thing, or our friend said we should check it out. That’s why we’re here.” It’s like, “Okay, cool. Tell me about that customer. How valuable is that to you? What would you have to do instead of building this yourself in-house? What have you explored so far? How important is that for you to ship now, versus in six months, or nine months?” These are kind of like qualification questions, but in a way also it frames the value that they’re getting out for us, for the product.
And I’ve had sales calls like that, where at the end of it, I’m like “Hey, man, I don’t think this is for you.” [laughter] It’s like, “I’m just gonna tell you – I’m not going to try to force you into something that’s the wrong thing, or pull a fast one on you. If I don’t think it’s gonna be a good fit… It’s like, I’ve just spent the entire time learning about your business.” Like, that’s the fun thing for me about sales. You get to learn about another business and how they think about it, and then try to problem-solve your way into how what you’ve created will help them. And when you can get that connected, then it’s like “Okay, how much would this cost you to build yourself? Okay, that amount for engineers. We’ll charge you less than that.” You know, some amount less. And then it’s like “Okay, cool. That’s great.” “Yeah, exactly.” And then everyone wins.
[01:00:04.02] But I think if you don’t come into sales with that curiosity, really wanting to understand what they’re trying to achieve, and what they’re trying to do, and you just kind of do your talk track - for me, that kind of sales would drive me nuts. I wouldn’t be able to do it. And I think a lot of developers have unfortunately been on the other end of receiving that, and that’s why they’re like “Ah, these sales guys just don’t get it.” But if you have someone asking you about your business, like “What are you guys trying to do in the next year? What are really like your big goals right now?” People love talking about that stuff.
They do. They do. And that’s all good qualifying, too. You understood urgency, you qualify whether you can actually even help them, which is totally the battle, right? …in that first call. Like “Can I actually even help you?” is my first concern. Do you value podcasts? Can I even help you? Do you have a message that’s worth sharing?”
What’s the impact you want to have on this right now? What would success look like to you?
It’s all questions, yeah.
And it’s also, like, if you understand what they actually think about success, versus just like not; some people, they can’t imagine what a successful engagement might even be. And if you can’t have somebody – if you’re working with somebody who doesn’t have that foresight, or just curiosity or imagination of “Okay, if we did this, this, and this, what would happen?”, well then it’s kind of maybe not even a profitable relationship. Because to me, it’s also about relationships; like you’d mentioned before, with Vercel, that’s probably a very amazing and much deeper customer relation; probably more like a partner at this point, than simply just a customer, right?
Totally. Guillermo was texting me this morning; we talk about all different stuff. But I think it is that understanding that questions. And for us, at least for me, building a product - I only want to sell to people where they’re gonna love the product and experience; they’re gonna be really happy with it. I don’t want to do a deal where someone a year later is like “Ah, we’ve put in WorkOS, but I don’t know if that was the right call.” I want people to be like “That was one of the best decisions that we made. That company has been so great to work with. It’s been so creative and helpful to us as a business. We would love to do more with them. What else have you guys got?”
“Can we buy more?”
I think that’s the right way to do this. Yeah, exactly. Like, “Let’s help you get to the next stage.” And I don’t know, I think if you frame sales like that, I would suspect there’s a lot of people that think that they can’t – like me a few years ago, four or five years ago, that think that they can’t do sales, or think that they wouldn’t be good at it, that turns out actually can be extraordinary at it for their businesses. And be able to do it in a way that creates this customer connection and harmony with the rest of your business that no one else you’re gonna hire is gonna be able to come in and do.
Yeah. You have to want to help people. You can’t be a taker.
It’s true. It’s not about making money.
Not necessarily. I mean, there has to be incentives in a sales role.
I don’t want to disagree fully, but I think the best part about being in sales is the potential zero ceiling. To some degree there is a ceiling, because there’s only so much you can actually sell… But if you give me maybe no base salary whatsoever; just give me the opportunity to sell my butt off and enjoy it and help people, and I make a ton of money doing it - that’s a great incentive, because I love… It’s almost like being an entrepreneur, really…
…because you get to be an entrepreneur within a confine, so to speak, or within a framework. And having that zero ceiling opportunity - like, it’s up to me to go as high as I can. I’ve been blessed with this opportunity, I’ve been hired to do this job, and I can just go as high as I want. Yeah. Give it to me.
I love when the incentives are aligned. It’s one of the most beautiful things about sales. It’s so hard to measure this stuff in other areas. You can’t really have a designer and pay them based on revenue. It’s really hard in most other – like, engineering is also very creative, and it’s very hard to have it be this linear, straightforward path. But for sales, it is aligned. And you can just have that unlimited upside in structures, right? Like, if you’re willing to perform, you’re going to be compensated as such, right? You’re going to walk away from that.
[01:04:05.26] And so when I said it’s not about money, I didn’t mean in the sense that you can’t make a lot in sales. I heard this joke once, that in a well-performing sales organization you have two types of people. You have new salespeople, and you have rich salespeople. And that’s it. [laughs]
Like, if you’re not performing, you don’t stick around. Or if you are performing, you do really, really well. And that alignment, I think, is allowed because it’s quantified and it’s so well structured. But I think if you approach sales from the perspective of just like only “How can I extract the most amount from this customer?” you’re not going to have – your incentives will be aligned in terms of your own personal financial incentives, but not in terms of the relationship with that company. And I’ve seen the people that are really good salespeople are actually like really creative, and they really can understand businesses super-fast, and build those relationships that end up turning into effectively partnerships. And they continue to grow those contracts. That’s a very different thing than like kind of just pushing a contract around, or going to the talk track, or saying “Oh, I can give you a discount the first year at this amount.” That’s all transactional stuff. That doesn’t really get in the creative piece around sales.
And I think this is really, really, really hard to do, and that’s why really good salespeople are paid up the wazoo. You’re like “How is that person–” I guarantee, if you ever need a salesperson, you’re like “Man, that guy did like $2 million last year, W-2. He’s making more money than anybody in our organization.” He or she, really. Just like – yeah, especially in the enterprise SaaS world, there’s some amazing women salespeople, too. Like, “What’s happening here?” Do a ride-along with that person. Be like “Can I just watch them work?” And your mind will be blown at what they can do. It’s like watching a stand-up comedian perform, where it looks effortless, and yet they just have you in the palm of their hand as they move through. And it’s absolutely extraordinary, and it’s a very, very dialed-in experience/skill… And they drive forward the value of the company, so they’re paid as such. It’s remarkable.
Yeah, I do concur on the direct alignment with the driving the value. Obviously, you wouldn’t buy nothing – there has to be a product; somebody has to make it - engineers, product etc. But the alignment of “Literally this revenue came in as a result of my effort” is directly correlated. And it makes sense to take a portion of that, for sure.
Yeah. It’s a pretty cool job. I don’t know, it’s funny, I’ve got like 180 on it. I used to think it was something I would never imagine doing. I was like “Oh, if WorkOS doesn’t work out, I could maybe go do sales.” [laughter]
“Aaand I do. Aaand I do sales.”
That’s weird, to hear me say that…
Let’s come home to this potentially emotional question… Because we’ve just been gushing on sales, and you clearly like it. You have an idea for how it should work. You said just last week you hired somebody to, I assume, take over what you’ve been doing, or at least eventually take over… Right? How does do you feel about that transition?
Oh yeah, I’m still gonna be really involved. I think it’s – I don’t just hire people and then completely throw them in the deep end and go. It’s really a process of growing and scaling the function. Kind of what I’ve found - the right time to hire someone to come into sales is when you find that there’s repeatability in it, and your calendar is stacked. When you’re stuck. I had a week - I think it was last week, or the week before - where I had 60 meetings that week, Monday to Friday.
Oh, my gosh.
Yeah. And at the end of the week, I was just zonked, and I was like “Oh, yeah, it’s about time for this salesperson to start and to kind of help scale part of the organization.” But I think it’s an evolving process. And one of the hardest things is going to be, as we introduce new products, that’ll change our sales motion. As we sell to big customers, it’ll change it. And so the job of the entrepreneur, I think, is not to just throw it on someone else and be like “You go figure this out entirely.” It’s to work with them and help incubate the function, and translate to them everything you’ve learned about it, so that they can take their knowledge and experience and combine the two things together, and apply it. You’re kind of – it’s like a bringing in someone who’s like an athlete, that’s really good at something else, and you’re trying to teach them how to play a new sport. And it’s kind of similar, right? It’s like a soccer player playing basketball; it’s like “Well, you know how to run and move your feet, and you’re pretty athletic… But we throw the ball here, instead of kicking it.” And you have to work with them to get to that point.
[01:08:25.19] And they’ll probably be better than someone that’s not an athlete, being able to adapt to it, but they might not have all the intuition or skills yet. And so we’re still hiring sales. It’s not just this first person; we’re building out a whole team. And my goal is to build it in the way that we talked about today - like really creative, consultative, asking questions, understanding, helping try to force value there. It’s not just pushing contracts back and forth.
For sure, yeah. The hard part about – I was hoping it wasn’t emotional. I’m glad it’s not, because you seem to have a very calculated direction for it, which is great. It’s a spot-on answer, honestly. Me, I may be a little emotional about it, because like “Well, I’ve gotta leave my thing, I’ve got to stop doing this very important role, that–” not that only I can do, but it’s hard to let go, because I enjoy it so much. I really enjoy, like you had said, getting to learn about different businesses, getting to ask those different questions, and ultimately really just being able to help people in their struggle, and that I have something, an ability, or my company has an ability or whatever it might be to evolve this thing for them, to solve this problem for them, and ultimately bring them joy and help them be looked at in their organization as a hero because they chose to do X, Y or Z with us, and we were a great partner in making that happen. Like, that to me is where – that’s where I find a lot of value. And I love that you’re not going to remove yourself from it, because I think as CEO and founder you have to stay in those kind of relational details. Like, imagine if you totally ejected; that would probably be the worst thing ever, because you probably bring something very special to your organization and how you explain it, but also just how you treat people. Like, if you removed yourself - well, that would be a complete departure of culture in your sales process.
I think that’s what it ends up with at the end. I’ve been thinking about this… So WorkOS right now, we’re recording this - we’re like 55 people, -ish; we’re like 50 to 60… Which is still relatively small. I kind of know everyone on the team, everyone’s names. That’s not going to be the case probably in the next couple years, at some point; it will keep expanding. And I’m going to keep giving away those Legos. I’m going to keep giving away those tasks or projects. Soon, we’ll have fully built out functions in more or less every area, and it won’t be my job to incubate sub-functions. So for example, right now on the engineering side we have an engineering leader who’s building out our infrastructure engineering team. I’m not doing that. But at some point, it’ll be kind of more fleshed out, and there’ll be more execs at the company. And then the question kind of becomes “What do you do then? What do you do when you’ve hired out every job, except for you? What do you do, sitting around?” Do you as the CEO go play golf, or go kite surfing?
I think it actually becomes - tying it back together, leadership is more about the Why. You know, what I talked about earlier around bringing people together who find a lot of satisfaction, and enabling other people to do things. What is the mission for WorkOS? What type of people do we want to hire? How do we behave? What are our cultural norms? How do we live within integrity with that, in terms of making decisions? It’s really hard to do. You’ve got a bunch of really smart people, coming from all different walks of life, in different directions, different experience, and you kind of need the whole thing to operate as like one organism, like one cohesive machine. And you never quite solve it. The thing is always fluid, and always kind of in flux in different ways. And I think the job of like a CEO is not just to kind of manage the executive team, and whatever… And specifically founders - it’s really to create that cultural alignment, and say, “Here’s why we’re doing what we’re doing, and here’s why it’s important to us. And here’s the things we’re not going to do. Say no.” As you become more successful, get more resources and more people, you can say yes to more stuff. There’s tons of stuff you can go do in the world. And everything kind of seems like a pretty good idea at some point. And so you need someone in the organization who’s actually saying, “No, we’re not gonna go do these things. This is who we are, this is what matters to us. This is where we started, and here’s how we serve. Here’s our place, and here’s how we serve people.”
[01:12:21.11] And then also people - when certain behaviors emerge, you can be like “No, that’s not quite us. We need to tack from that, or change things. That’s not quite how we want to treat people”, or “Here’s something’s that really important for us.” I think oftentimes it’s performance. “We’re going to have a really high-performing team.” Well, that means sometimes you have to let go of low performance; that’s really hard to do, you know?
And so I think the leadership thing becomes – the problems actually get harder and harder as the company goes on and scales; it kind of becomes fractal in that complexity. And that’s just another level to build towards, and I think, for me at least, personally, it’s why I’m so excited.
A friend of mine asked me - a friend who has known me for a long time - the other day… I was hanging out with him, and he was like “Yeah, Michael, you’ve been working on this WorkOS thing for four or five years or something.” He’s like “Are you getting sick of it? Do you want to just let go?” It’s a buddy of mine who’s moving on to a boat with his wife for a couple years. They’re gonna go sail around. I’m very jealous. He’s like “Why don’t you just kind of hop on the boat, or come hang out? You’ve worked for a while… Why not take a break?”
And I thought about a little bit, because that is a timeline where people usually get tired, or kind of get burned out… And I was like “Man, I’m more fired up about this than I ever have been, because it’s changing so much, and the company is really evolving and growing.” I don’t have any children, but I was talking to another person who has kids, and I was kind of talking with them about the growth and evolution of children… What’s more fun, from like two to three years old, or like 15 to 16 years old? I don’t think you really pick; just things change and evolve so much during different phases. And WorkOS right now is an organization that’s going through that, and it’s going to keep going through that for the next few years.
I think for anyone maybe that’s listening that’s like an entrepreneur in that middle state, when you kind of haven’t gotten product-market fit yet and you’re grinding - it doesn’t end up being worth it on the other side, as things… Like, there was a couple hard years as we were grinding on the initial product for the company… But if you can make it through those phases and get that kind of growth and that kind of customer base - it does come in waves, but it continues to be really fun. I can’t imagine doing any other job, to be honest.
Yeah. That’s good for you. That’s what we can all ask for in life. We want to be nowhere else besides where we’re at right now, and be content in what we’re doing. And that’s not how a lot of people are. They’re looking for the next thing, or they’re looking further forward, and they’re not in that moment of contentment in terms of where they’re at and what they’re doing.
It’s a really good time to start companies right now, too. I bet a lot of people listening here are thinking about that…
Why do you feel that way?
It’s just always kind of a good time whenever there’s like an economic downturn. It turns out that’s like the ideal time to start a company.
Yeah. The question is “What?” It must be artificial intelligence.
Okay, so I have a trick for coming up with good company ideas, actually.
Please do tell me.
Okay, so here’s – because everyone’s like “Ideas are cheap, executions is all that matters”, yadda-yadda. And that’s kind of true. You’ve gotta build stuff.
The idea guy has become the archetype. Here’s the formula to coming up with really good startup ideas. Figure out what’s the area that you have unique insight in, first of all. What have you just been doing for the last few years? For you, it’s a few different things. But even just like podcasting, right? Like, you’ve been in this world, and thinking about it, and experiencing everything in the current state of it… So you actually have a really unique insight about the state of the world there. For me, all the stuff I talked about with WorkOS is all this like enterprise SaaS stuff from a previous company. I would be a terrible founder going and starting something like a biomedical technology company, right? I just don’t have any insight there. It doesn’t matter how brainiac I would be as an engineer, or something. It doesn’t matter. I don’t have the unique insight.
[01:15:59.09] So find an area of where you have spent a lot of time… And this is probably related to what your job is today, or kind of how you grew up, or something. And then around that, figure out something that is the way that you think it should be, but for some reason, no one else can figure that has done this. Like, “It should obviously be kind of like this. Why hasn’t anyone just–” And it’ll feel like – it’s so obvious to you that it’ll feel like someone must have done it this way. And you’ll be looking around, and you’ll be like “I just haven’t found it yet.” Someone must have solved this problem this way. And likely what’s happened is actually no one has had that insight, and been in that kind of state of mind to actually solve it in that way, and you are the right one to do it.
I think the product-market fit kind of game - it’s actually a lot about like founder-market fit; what experience and insight do you have, that you can draw from? And that’s where you find really, really good ideas. Those are the ideas where to everybody else they look like a bad idea, or they just can’t tell; they’re just kind of numb to it. But if you’ve been in that area and you’re like “Oh, yeah, this thing would be awesome. If I had this, or it worked this way, or this kind of thing existed.”
And the really frustrating thing is if you take that idea, and you try to go to explain it to other people, they won’t get it. They won’t get it, because they don’t have the insight around it. So all good ideas do look like bad ideas initially. But you can’t blame them. They just haven’t spent all that time in podcasting, or whatever. But I think that’s the essence of it - find the area that you’ve been in. What’s really hard to do - I’ve never figured out how to do this - is to come up with really good ideas in domains you don’t have any experience in. because you’ll only be at the surface level, scratching it, and you just won’t be able to come up with anything that novel. I think that’s a really hard place to be.
For sure. You have to be steeped in something; some domain knowledge, some unique expertise, or experience with something… Otherwise - yeah, like you said, you’re just gonna be on the surface, just sort of like where everybody else is mostly at. Most of the people are at the surface; there’s only a few who sink down deep to really solve the hard problems, and that’s where I think the scale possibly is even, too; where the opportunity meets the need is that few layers deeper.
One of my pals is this guy, Jason Boehmig, who started Ironclad, which is this really cool – it’s kind of like a CRM for like legal contracts. It’s kind of a weird idea. You’re like “Why would you start that company?” He was a lawyer for years and years and years. He was actually my lawyer at Fenwick & West. That’s how I met him. He was like the attorney there. And I remember I was meeting up with him for a drink and he’s like “Man, I’ve got this idea for managing contracts. All these startups have this huge pain, and we try to incorporate people, and… It’s just a nightmare.” And I was like “Boom. Dude, you’ve got it. That’s it.” And I don’t know anything about the legal side, but I was like “You see it, it’s in that area.” And Ironclad has raised hundreds of millions of dollars. They’re doing really, really well.
“A global leader in contract management software.” Wow.
Yeah, this was years ago.
That’s the person?
Yeah. So Jason got this company started. But it just came from him having spent time in the world of contract management, and working with startups, and understanding their legal needs… And he just kind of saw this window. And I think to a lot of people initially it didn’t make sense. They were like “I don’t get it.” And it’s like “Well, you didn’t get it because you haven’t been a lawyer for a while.”
Right. You have no bloody knuckles.
Yeah. Yeah. And he partnered with – his co-founder is someone really strong on the engineering side, to build it. And they do a bunch of AI stuff now on top of it as well.
I’m sure they do, right? Everything’s AI.
So that’s the secret to success. That’s the secret - figure out what you know, go deep in that, and… Success isn’t guaranteed, but that’s a pretty good starting point.
Well, it’s better than no starting point, right? Half the battle really is – there’s such a draw to being an entrepreneur, to being creative, to create something… There’s such a draw to that, because it’s become the cultural norm, to be a founder, to be an entrepreneur, right? And I get it. I totally get it. There’s a lot of great things that come with that role. There’s also, as you know, a lot of things that are just like “Man, that sucks. This is a hard part of the job.”
[01:20:08.29] It seems from the outside like this glitz and glamour, or only the good things, but there’s also a lot of hard things that come with it that you have to persevere through, you have to be resilient, and you have to be prepared for the change, like you’d mentioned; like, how often the role changes, and how quickly your company changes. Now, depending upon what you’re building or whatnot, but there’s just so much change involved. If you’re someone who thrives on normality, and consistency, it’s not impossible, but it’s just not likely that you’ll find that being an entrepreneur, or founding that company, or whatnot. You’re gonna have a lot of change.
People don’t really talk about the downs. People celebrate the ups, if you go scan through LinkedIn, or whatever. But it’s rare that people talk about the challenges of it, or the downs, or the waves that people go through. But they’re definitely there. I think it’s a high extreme up, and high extreme down environment. Definitely not for everyone.
I have friends sometimes that are like “I should go start a company.” And I’m like “I don’t know, man. I don’t know if this is what you’re gonna like.”
Do it young, before it’s too late to fail. Sometimes – well, I mean, I guess not… What’s the age-old story? Kentucky Fried Chicken fella, he started his company, KFC, way late in his life?
But I bet he was doing something he knew. That was the thing, going back to the idea…
Chicken, right? Food.
Yeah. If you’re in an area that you have experienced around… That’s actually the way that older entrepreneurs win, is that they have the domain experience. They can kind of use the cheat codes, and move forward faster. It’s really like whatever life you’re living, and whatever you’re into.
This is why it’s always puzzling to me when there’s a couple of really smart young kids, and they’re like “We started a company to do title and escrow management for buying homes.” And I guarantee you that was not that kid’s idea. That was like some VC that was like “You should go build this. I think that there’s a market here.” But then they lack the nuance and understanding for it.
And the counterpoint to that is, you know, why did social networks come out of universities? Well, what do you do when you’re in college? It’s all about building relationships. All you’re doing is that. I mean, you go to class, but you’re really socializing at an extreme – you know, most people never socialize at that extreme level ever again in their life, other than when they’re in college. So of course, college kids would be the best to think about building software to help people connect and socialize.
But it’s hard to reflect and figure out “What is the thing that I know really well? What is the thing that I’ve been in?” And I think for a lot of people too, that can feel kind of boring. You feel like “Oh, it’s the thing I’ve always been doing.” But if you can apply technology to that, and think about the way that the world can be different, what ends up happening is as you make that difference, as you start moving things and introducing new ideas, or finding new ways to do it, you find that the people you sell to, your customers, are the people you’re excited for them to have this impact.
If you think about – we’re going back to sales; say you’re gonna do some software on like podcasting - you would understand innately why it was better. You would get fired up and emotional about why it was better. Probably when you’re selling it to people, they would connect with it in a different way, and connect with you. Like, how rewarding and satisfying would that be, compared to you selling bricks, or concrete, or something like that?
Yeah, or something way foreign, and you just have no context and no tie to it.
So it’s not just a way to get good ideas coming up in that formula, but I think it’s a way to actually have sort of a more fun experience, and a better life as an entrepreneur, if it’s in there. People call this passion; I think that word gets thrown around a lot. But it’s really what you’re wanting to like geek out over. That’s actually passion. And for me, I love geeking around APIs, developer tools, and SaaS stuff… And those are the people I get to talk to, and sell to. But if you’re just picking a random thing, where you’re like “That seems like a good idea. Let me go do that”, I think that’s when it gets really hard. Because when the going gets tough, and you have to grind through it, what have you got left? It’s just hard to sustain it.
In light of you mentioning the downs, I’m curious - since we’ve talked a lot about the ups for you, what’s a down for you? It doesn’t have to be from WorkOS particularly, but what’s a less desirable, or less than desirable thing you’ve had to deal with in the last couple of years, that’s something you could share?
So this was like a year or two ago, a couple years ago… And before that… Where this happened - we were building out the company, and it was very early in terms of sales and growth and marketing. And my thinking was that I should hire like an enterprise style marketing team. Like, we’re building infrastructure – this is really early on; we’re building infrastructure for people to build SaaS apps. They’re building enterprise SaaS apps, it’s all enterprise… Let’s do like enterprise marketing. And so I went through the process and hired a team of people on the go-to-market side, like marketing, creative kind of direction, editorial direction, content marketing, product marketing, all this stuff, specifically around like enterprise marketing. Like webinars, getting stuff in Gartner, that whole style.
And I hired this whole team, and started doing work, and everything; we were working on a website redesign… And then at about seven months in, or sometimes like six, or seven, or eight months in, I woke up one morning and I was like “Oh, *bleep*. This is totally wrong.” Not like a little wrong; like, completely wrong. Our users are not enterprise people. Enterprise marketing is not gonna work. All the stuff we’ve been doing here is not having an effect, looking at all the data. And I was just like “Man, I totally screwed this up.” I just didn’t know. I had an idea of what the strategy could be, and it was super-off.
And if we continued on that path, it was going to actually hurt the direction we were doing really well in, which was like developer marketing. Like, developers didn’t want to get on a webinar. They didn’t want to have to talk to sales. They just wanted good blog content and docs. They didn’t care about what was in Gartner, or Forrester, or the industry analysts. They cared about what other companies were using. Like what Vercel was using. They wanted case studies, or founder testimonials.
And [unintelligible 01:29:16.22] all this stuff, and I was just like “Oh man, the marketing team structure I have - they’re really good. Their experience, their skills, and everything.” Like, we hired really good people. But it was kind of like, you know, you were opening a French restaurant and it turns out you need to make Indian food. It’s just like kind of a totally different flavor. And so I made this decision to actually completely lay off that whole team. And I talked to them, I was like “Look, our strategy is changing. We’re gonna set all you guys up with –” This is well before any of the big companies did layoffs a year or two before. I was like “Look, we’re gonna set you all up with good severance, and I want to make it clear that it wasn’t that you guys did a bad job, or you didn’t do the thing I hired you for. This is on me. I picked the wrong strategy and direction.”
[01:29:59.25] Stuff like that - in some ways, it’s really clear, to make a decision like that. It’s like “Oh, we’ve got to change direction.” But you really mess up people’s day, at least; or their life, in a way. They have to get a different job, they have to transition, and it’s hard for everyone… And I think making decisions like that and executing on them are actually one of the harder things to do as an entrepreneur, where you kind of know what needs to happen, but doing it is gonna kind of suck, and it’s going to be a pain. And no one else can do it other than you, no one else can make that decision other than you, but you know it to be the right one, and you’ve got to go through with it, and have that integrity. And not everyone that you lay off in a situation like that responds well to it; it’s hard to communicate that to folks.
There’s a bunch of different pieces around it, but there’s things like that, where – that was not a good month for me, working and thinking about that. And then for me, being like “Oh, man, I really messed this up.” And it’s not just having to lay people off, it’s like, it’s expensive, now you wasted a bunch of money for your investors, that’s a tough feeling… And then time. I was like “Man, I spent all these months trying to do this thing, and trying to – I’ve kind of got to start over.”
And so there’s definitely downs that are like that, which you kind of just go with. And ultimately, in hindsight, it was totally the right call for us, the right decision. We’ve found our path, we ended up rebuilding stuff in the direction that was the right fit, and all those folks went and got jobs, and everything’s fine. Everything’s fine, right? Everything’s okay. But I think in moments like that, one of the hardest parts is you don’t have a counsel to make a decision. It’s just you. You can call your investors, you can talk to your staff about it, or your co-founder or something, but at the end of the day, you’ve got to make that call, and it’s got to be your responsibility, and you’ve got to recover from it.
So making mistakes is totally fine, I think, in startups. I think if you’re not making mistakes, you’re either not self-aware, you don’t realize you’re making mistakes, or you’re not moving fast enough. So making mistakes is part of the job. And I think one of the hardest parts is to learn how to know when you’ve made a mistake, and how to correct from it quickly. And as much as you can take care of people… Like, we’ve tried to do something as a company when we unfortunately sometimes need to let people go - that we’re kind with them in the same way we are when we hire them, and how we treat people. Because even if the company has changed direction and it’s not the right fit for someone anymore, they maybe still had a big impact, and still done a great job at the company… But it’s still really tough to do. I think those are some of the hardest decisions to make.
Product strategy can change left or right, and that can be tough. Winning and losing customers, that’s a high and a low. But those kinds of strategic decisions and the implications that they have - they sit with you for a while, and I think those are the things that help you grow and evolve as an entrepreneur as well.
Wow. Well, that was a good share, man. I like that. I mean, I don’t like that, but I liked the rawness and the realness of it. I just can’t imagine – my empathy goes right to how did you bounce back… Because I’ve been there, in the wrong decisions, the wrong direction; not exactly the same version of it, but I’m just thinking of myself, like, when I respond back to those things, it’s not always immediately. It’s kind of a slow stretch, and a slow comeback, because it’s almost like – it can be very depressing, because you could take it personally, like “Oh, I’ve made this terrible decision, and I’ve got to course-correct”, and maybe there’s some shame involved… There’s a lot of things psychologically, from external, and then even internal, how you feel about yourself… So how did you persevere through that?
Yeah, it’s good to reflect in those moments, to take some time and just think about it and kind of sit with it… And in those moments oftentimes I like to think about the people that kind of believe in me; that they’re not necessarily disappointed, that making mistakes is part – I mean, obviously, they would prefer that you didn’t do that…
Sure. Be perfect.
Yeah. And I called a couple of my investors and I told them, I was like “Hey, this thing happened.” So it’s just like if you hear about it, here’s why. And these people are great. You should hire them at your other portfolio companies, right? They’re great folks. But I think for me, a feeling is just like “Oh man, I’ve just like wasted their money.”
[01:34:01.12] It’s a big privilege for someone to invest in your company. They really are giving you capital and being like “Make good decisions. Go forth and make good decisions.” And that’s just a huge privilege, a huge responsibility. I think that’s the thing that becomes the higher stakes and just weighs on you more; you want to be really thoughtful, and you’re kind of like a custodian of this capital from them and their LPs. For WorkOS we’ve raised from a bunch of different investors, and they have LPs, their big investors are I think primary LP, and a couple of funds that invest in WorkOS is actually the MIT Endowment. It’s actually my alma mater. It’s like, I don’t want to lose their money… They need that for a lot of reasons.
But I think you just think like “Okay, this is part of the process. They expected me to make some mistakes, and what they’re betting on is their belief that I can recover from those mistakes, and make the right call the next time, or help evolve it and kind of move the ball forward.” And making mistakes is okay as long as You’ll learn something. If you’re making mistakes and not learning anything, and just kind of like bashing your head around, that’s not okay. But if you’re trying things and making big bets, some of those turn out not to be right. As long as you learn something, I think that money was spent in a reasonable way. What’s that line? It’s like, “Insanity is doing the same thing again and again, and expecting different outcomes…”
And so with the marketing team, what did we do? We said, “Okay, well, we’re not going to do it that way again. We’re not just going to repeat that. Let’s take a different angle at it, or think about it in a different way.” And for us, what we did is really reorient around developers, and said, “Hey, how can we really market specifically to developers? Those folks writing code, building stuff. We need code on our homepage that communicates the value. We need to speak authentically and clear with them. No nonsense. Not be afraid to get technical with them.” And it turns out that was okay for us to do, because we had the culture already internally to do that. But there’s definitely ups and downs, and I think one of the things that’s tough about starting a company is your identity is kind of wrapped up in it. You really put your heart out there when you care about something a lot… And it’s really tough when you hear people rip apart your product. You read the Hacker News comment, and they’re – like, “I’ve been working on this thing for like three or four years, and this person just shreds it without really knowing the value…” It can be emotional. Twitter’s like that, too.
Yeah, for sure.
But there’s no trick for that. I don’t know. It sometimes still gets to me, and I’ve gotta – I live next to the park in San Francisco, and occasionally I just need to go – just close the laptop, and I go look at the ducks… [laughs] And just go sit out there and look at the geese, and… There’s this pond in the park that has a bunch of turtles, and I just go watch the turtles for like an hour, and… You know, they don’t care about any of that stuff.
For sure. So you said it was a few years ago?
Yeah, this was a couple of years ago, I think.
So you have the hindsight essentially, right? That’s 20/20. So you can kind of see differently now, than you could have then. In the moment it’s very micro; what’s happening now, how’s this today? And then now you have the macro view, which is much further out much, more zoomed out… And I’ve gotta imagine, clearly, like you said, the choice was the right one, it was hard in the moment… But more so the idea that sometimes you’re in like these really hard times in life, and you feel like “Man, this is everything. This choice, this wrong choice, this wrong decision, this moment, this–” You know, whatever you’re feeling is like everything… But if you just wait… You need to be patient, and you keep going in the right direction, like you have been, I’m sure now you have a different look. Like, that may have been a – I don’t know, what would you call it? A fail? I’m not sure I would call it a fail. It was a down moment, a wrong choice, but ultimately it helps you hone and evolve who you truly are as an organization, as a company, which is a net positive to your overall success. Right? Like, if it weren’t for that down, could you have this up? It’s like the bitter and the sweet. There is no sweet without the bitter, there is no dark without light, kind of thing. What do you think?
[01:38:10.02] We’re definitely stronger on the other side of that, as a company. I think it’s something we learned about ourselves, and learned about what we’re going to do next. And it’s more information for us as a company. And most decisions are like that. I think that’s really what advances things forward, in terms of culturally what’s important to us, or product-wise what works or what doesn’t; who are our customers. All those things around businesses. But you’ve got to be willing to miss; you’ve got to be willing to miss some. The only way to guarantee you don’t miss is you don’t take any shots. If you’re really scared of missing, just don’t be in the game. Don’t do anything. And you’ve just got to realize that missing is part of the game, and it’s not about making everything, it’s about making good decisions, learning, being curious, being able to reflect, being able to communicate and treat people well… You know, all these kinds of things that are just like the fundamentals.
I don’t think there’s any secret to it. It’s just that these fundamentals are hard to have discipline around, day in and day out. It doesn’t get easier as you get bigger, or you go faster. But you’ve got to be willing to miss some, and I think this is one of the hardest things as companies get bigger, is they get more conservative. The stakes get higher in terms of what happens if you miss. You hire some exec, and they’re like “Yeah, I don’t know if I want to build this new big product, because it might not work, and then I won’t get promoted, or I won’t be seen as successful in this in this organization.” But that might be the quintessential thing you need people to do in order to get to the next stage. How do you continue to have risk in a company as you scale? Companies inherently become less risk-tolerant over time; how do you inject risk into it, in the right places? Not everywhere, but in the right places, so you can keep taking those shots [unintelligible 01:39:50.07] It’s kind of like you’re shooting basketball, and it’s like you keep stepping back. So the shots are bigger, but you get more points, you know?
It’s tough, it’s really tough. And I think this is probably one of the challenges for me over the next few years at the company. We’re at this transition point where we’re supporting hundreds of customers, and expanding, and all that… We’re gonna become more conservative over time around building new stuff, kind of shipping new products, higher risk around it… How do we still keep that nimble mentality around trying new things, and still making bets? That’s a problem I have to go solve for the company, as like the company builder.
Congrats to you for having that job. Is there any company out there that you can emulate, that you think is kind of mature, and sort of safe, so to speak, and in that place where they probably shouldn’t take risks, but they find ways to?
I think emulating others is a really dangerous thing to think about, and it’s kind of like a cargo cult mentality. I talked about this with my team actually quite a bit… Because the place that another company has converged to, like where they’re at today - they did probably didn’t go directly there. They probably went through a different pathway, and then just converged upon that eventually. And so it’s really dangerous just to see what a big company does and apply it to a small company.
My example I give about this all the time is like OKRs, like objectives and key results, that’s like the goal planning framework that Google came up with, [unintelligible 01:41:15.17] And like, OKRs maybe work well at Google, but I think if you do them in a small company, it’s a total disaster. It’s like a misapplying of framework for a small company. It’s like that equivalent of the dinner party where you hire a pastry chef. It’s like “No, we’ll just make the dessert ourself. We’ll do it stage-appropriate.”
Yeah, I think that it’s really dangerous to look at big successful cases and try to back-propagate from where they are at that moment to today. Because then if you go and talk to the people that actually built it - that’s what I’ve been doing the last couple years to learn. I go talk to people that were early at like CloudFlare, doing sales. Don’t tell me about where Cloudflare is today; I want to know where Cloudflare was in like year three or four or five. What were you guys doing then? What did your sales team look like? How did you compensate sales reps? And you know what they’ll say? They’ll be like “Everything was screwed up. It was such a mess. We were trying to evolve. We kept changing every six months.” That’s the process you go through to get to success. But that’s not what the person who’s running it now would say. They’d say, “Here’s the process we ended up at, and here’s how we’re scaling it.”
[01:42:18.10] So I think emulating is really tough, but there are companies that I think are willing to take big risks. And I really, really admire them. Cloudflare is actually an example of one. If you look at the shipping philosophy of what they’ve built in the last few years, it’s just mind-blowing. They have something going on there that’s very different. They’re building product at a velocity and at a scale that very few companies do at that level of maturity.
Another one I’ve always looked up to is actually Apple. Not necessarily Apple today, but if you look back at Apple in the kind of like iPod, iPhone era, every year they were rebuilding the iPod. They would have the top-selling music player in the world, with like 98% market share, and they would every year throw it away and clean-sheet design the next one. That takes so much discipline, if you think about that… If you have the top product ever, and you’re just like “Screw it, we’re gonna start over.” Every year. Like, you have to have so much discipline to do that as a company, to not rest on your laurels and to be willing to throw it all away to try to find the next thing. That amount of – I don’t know. It’s just – it’s like palpable when you think about it how hard that must be to do.
Yeah, for sure. Apple’s a different beast though, for sure. But I do agree.
Well, they’ve done it again and again, too. Even if you look at the Mac to the iPhone transition - like, they went from like all of the revenue being from like Macs to all of it being from like iPod and the iPhone, in a few years. It’s like literally building a brand new company. It’s wild.
It’s almost hard to imagine that type of scale of transition happening in other companies… And I think you have to be willing to go all-in and sort of bet the farm. Other things I’ve seen happen like this - Intel did this early on, when they transitioned from memory to microprocessors. Boeing did this when they built the Dreamliner, the composite new aircraft, 787… You know, they bankrupted the company to build that thing. It took so much capital investment. You just have to be willing to go all-in, and I think that’s a maneuver that small companies do, and startups do, because they have to do in order to do it… But say what you will about Meta and what’s happening there with Zuck, but man, do I respect the guy for what he’s doing. Like, the amount of courage he has to do that, and the discipline he has to push the whole company in that direction… You might be wrong, whatever, but man, that’s really, really admirable to do, compared to companies who weren’t willing to take that risk, or even try anything; that’ll just sit around and hang out.
Yeah, that is a good example, because not only is it a different direction product-wise, but also a different name that was formed around the product. Like, that’s just – I mean, you might eventually say it’s courageous… Right now we may think it’s not so courageous. It’s definitely audacious… I do not envy the position.
Yeah, in a few years you’re either a genius, or the biggest fool, squandering an opportunity. That’s what the pundits will say. But in the moment, you can’t tell. And I think that separates people, I think, that are kind of in the game-playing from people that are not, is willing to take that risk. And that’s actually something I’ve seen that all companies, all great companies in my mind share, is the ability to take large risks, even after they’ve grown and scaled. Because the only guaranteed thing is like if you don’t do that, someone else will. Someone else will be willing to try. And Facebook had this in the little red – I think it was the little red book that they had, and they talked about like “The Facebook killer needs to be built at Facebook. We need to be the one to kill our product, not someone else building a new product.” That mentality of constant rebirth; nothing is sacred. It’s a really scary place to be, it’s really hard, and it doesn’t feel that safe as a company… And I think it’s a hard place for a lot of people to work because of that. But it’s also very real, and you’re very directly connected to it.
[01:45:56.19] And going back to something you were saying earlier, about how do you do this every day - I think that’s the piece that makes it feel fresh. You never know what’s going to happen next, and… You know, in two years, WorkOS could look like something totally different, for sure. We could take a big bet and have it pull us in a different direction… And it might – we might see. But…
Well, I do like where you’re at now. I will commend your design talent, and your – I mean, copy, design… There isn’t anything about all the pages, and I have like – just too many to count; at least 10+ tabs of your website opened up just to kind of dig into the product a bit more… Because [unintelligible 01:46:32.01] into your site. I don’t build applications that need WorkOS today, so I’m sorry, I’m not that steeped in all the product details…
Most people don’t, actually. It turns out we’re kind of a niche product.
Wow, that’s crazy.
Yeah. The design is a tough one. I have a secret for that one, too. None of these things are secrets, but here’s the secret: you have to be willing to spend more time on it than anybody else is willing to. That’s the secret. Anybody else that would work on it would just be like “I can’t believe you’re still working on that. I can’t believe you’re still – another pass? Isn’t good enough? We all want to ship this and get back to our jobs.” You have to be willing to just hold and wait until it’s like truly excellent. I think the trick is patience. Even at the moment when you think it’s done, like “I can’t figure out anything else. I can’t figure out how this could be better”, you still need to like just take a breath, go for a walk, and then come back and just trust that in a couple of days your mind will see it, and you’ll be like “I actually know a little thing that can make this much better.” And that one little thing at the end - that’s what it’s all about. Everything is to get to that point. That little thing at the very end, that’s the thing that people notice, and that’s the difference between, I think, pretty good and like really great, is that last like 0.2% in the process. And you’re only going to get there if you have the discipline to just be calm, keep iterating, and not give into the desire to ship it right away. That’s so hard. It’s so hard, every single time. It’s excruciating.
It’s sort of challenging though, Michael, because you have competing advice, right? You have, from your friends at Facebook/Meta, you’ve got “Done is better than perfect.”
100%, yeah. Release early, release often. Absolutely. Yeah.
Move fast and break things, all these things.
We talk about sense of urgency being a really important thing, and speed being a huge advantage that startups have. We talk about this internally all the time, about how we want to move quickly, and make fast decisions, and follow up fast with the team… I don’t know; that’s the thing, you’ve just gotta be – and really, it comes down to the people though. Like, really what it comes down to is having a group of people where you all look at each other and everyone’s kind of like “Okay, I’m tired. We’ve been grinding on this for a while. This is pretty good. I think this will be okay.” And someone has to be willing to step up and say, “You know, it’s just not quite there yet. I think it’s just not quite there. I’m not saying it’s super far off, but there’s something here I think we could just do a little bit more on.” And what needs to happen after that person says that is everyone else says, “Okay.” Not like “Oh, you’re crazy, man” or “You don’t know what you’re talking about.” Or “Oh, God. Another revision?” Everyone has to be committed to the highest level of quality possible. So it’s not an argument that you should spend more time if somebody feels like it could be better. That’s the hardest thing, is actually getting a group of people that also have the patience to that, and the discipline. And it’s weird. That’s a thing where some people – some people just don’t like working like that, also. I should be clear, this is not the way every company should build stuff.
It’s also not required. Like, WorkOS could be a fine company without doing this. But in my mind, that’s like the hardest thing about getting this level quality; it’s not just the time. You have to be willing to put in the time, to wait and iterate on it… But it’s shared values. It’s everyone’s saying “The reason we’re doing this work is because we want to create something at that level. And we’re going to be uncompromising in that value as a group.” That’s really hard to build a language around. You can’t do with a big team, too. It has to be small. But it always takes more time than you would ever expect. Like, you could ever imagine how much time will it take - it’s more than that. And just willing to take that time. That doesn’t guarantee it’s going to become good, but it’s definitely required. It’s definitely… It’s definitely required.
[01:50:20.14] It’s really a lot easier to appreciate the work you did put in, regardless of outcome, if at the end you’re like “That was the best I could do. I put it all out there. Everything I have was put into it, and… Success or not, fit or not, I put it out there.”
Yeah, like misses are kind of – you know, when you have a failure… I think the place that you can have solace in if you do miss, or do fail, or have a company that doesn’t work out, is being able to say “I gave it everything I had. I put it all out.” It’s kind of like if you’re an athlete, and you go to the Olympics and you don’t come home with a medal… What you want to know is that you showed up, and you put everything into it, and you were fully there, and fully committed, and you did that. You can be proud. No one can take that from you. You can have that pride forever. And that’s what unifies people afterward. After you’re tired, and you’re resting, you get it out, that’s what really is kind of the cultural alignment.
I think when you compromise on that, when someone’s like “Oh, we could have made it better, but we just kind of shipped it.” I don’t know. If you always feel like you could have made it a little bit better… And I’m not saying you should wait forever to ship something. There’s an art of scoping things down, and an art of figuring out what to build… But you don’t really feel like you’ve done your best work. And I think there’s a really cool feeling of creating something where you’re like “I didn’t know I was capable of doing that. I’ve never worked in environment where I’ve been pushed this hard. I didn’t know I had it in me to make work at this level.” It kind of messes with you; it really changes the way that you think about your work going forward… Because you both know what you’re capable of, but then you also know how much time it takes, and how much effort it takes to put into that. And you have to make a decision then, like “How am I gonna live my life?” [laughs]
You know, like “Can I work in any other way after tasting this? Or am I willing to compromise on that for some other reason?” It becomes a personal decision, I think. And I think people that are on the other side of that, where they’re like “Look, I’ve tasted what that tastes like, and I only want to do work like that.” That’s the most satisfying thing to me, that’s the only thing I can imagine doing, that gets me fired up. I want people that are gonna push me in that way, and I want to be in that environment. If you’ve felt that, and you’re not in that environment, it drives you insane. Completely insane. Like, I’ve just seen it cause people to flame out of companies, incredibly talented people, because they’re just wanting to work at a level that other people aren’t willing to hold that… And the only solution to that is go find other people that are similar to that. Or other people that are willing to think in that way or push in that way. But when you do find it, it kind of feels magical. It’s really this shared alignment. And it really feels like a team effort. It’s not hierarchical. It’s a team effort, and everyone’s trying to hold each other up at that level, and you’re expected to perform at that level. I don’t know, when that works, it ends up becoming a pretty divine work environment or work experience… But boy, does it take a lot of time… [laughs] And grind at you. You know, that last bit sometimes is the – I don’t know, it’s like the most painful; it’s like the last five steps of a race, or something, that you run, when your body’s telling you to stop, and it just takes that final push… But I think if you do it, the other side of it is actually a lot of satisfaction, and really deep pride in what you’ve created.
For sure. Well, since people may have listened to this show all the way to this point, and they like you, they may want to work with you, they may want to work for you…
We’ve kind of departed from SAML APIs.
We did depart from SAML APIs quite a bit… [laughter] But you know, you have to begin somewhere though, right?
And that’s what I love about this podcast, is there’s – like I was telling you before the show, Mike, I don’t really know how to tell you how the show’s gonna go, Michael. I just know roughly where we can go. And really, it kind of depends on ultimately the willingness of the person meeting with me… Because it’s not my story I’m sharing necessarily; I’m just sharing anecdotes from my story that are similar to yours, and we obviously pair up, and stuff like that…
[01:54:16.12] But really, it takes the commitment and the willingness of the person meeting with me to share, and to be introspective, and be willing to even put out their flaws, potentially even. Not just the things they’re most proud of, but also the things that there’s like “Man, it’s kind of like, I don’t tell too many people that story. It kind of sucks when I do tell it, and it hurts a little bit”, or whatever, the situation is. So I commend you on showing up. I think you definitely showed up today, so I appreciate that. But since you did show up, I’ve gotta imagine that you’re probably hiring, and so if you are, please just spout off what – if people are listening to this and they’re like “I can work with this dude. He’s got something going here.” Do you have anything open? Where should they go if they do?
Yeah, we’re hiring. I mean, we’re hiring always, across the board. We’re always looking for great talent. I think that as a company we’re trying to stay pretty small also. We’re not just exploding in headcount. I think to do really great things, you don’t need that many people, and becoming a big company in terms of number of people is not the goal. That’s not the objective. We really look for people that – I think some of the things I talked about in terms of like quality and discipline, and like really wanting to do that type of work… I think for anyone listening, if that resonates with them, they end up being a pretty good fit on our team, and working in that way. Because it’s really about alignment, not just about skills; it’s like choosing to work in that way, and to have that type of meaning in your work as well.
I think in particular on this podcast, since there’s a lot of people listening to this that are probably kind of from like a previously a founder background, or maybe that hybrid set of skills - you know, we don’t have any product managers on our team. And what that means is that our engineering and design and support team, and kind of even our sales organization now really directly informs the product and drives things forward. Like, everyone’s responsible to think deeply about our product, and customers, and experience. And in particular, for anyone that maybe feels like they have never been a good fit in the boxes, the confines of being a PM, or an engineer, or a designer, that kind of don’t fit properly… Maybe they’re a designer that actually likes writing code and building stuff, but the engineers don’t appreciate aesthetic, and so they call themselves a designer, and work with designers…
Or maybe there’s someone on the engineering team, but really what they do is think through product experience. So they love writing, they love connecting with customers, actually, or users; they actually maybe secretly would be a marketing person, except they like writing code too much, they like technical things too much. I think those types of people that are kind of this interesting background, where they’re sort of the misfit toys if they try to go work at another company, within a small organization like WorkOS, where we’re still growing and evolving, there’s huge opportunities for people like that to have a lot of end-to-end ownership. And in some cases at other companies where it’d be three different jobs, you hire someone extraordinary who can do all three as one person. And that’s the perfect fit for that type of person.
Those people end up often becoming pretty good founders later on too, or at different points in time, because they have a lot of different skills… And the pitch I would give for them joining either WorkOS, or another kind of growth stage company, is this is kind of the training ground for you, to have that full experience and be part of that scaling, without needing to roll the dice in product-market fit early on, by being able to experience it.
WorkOS right now is the size that Dropbox was when I joined it 10 years ago. I worked there for six months. And the experience I had working at Dropbox when I was a college kid completely informed me [unintelligible 01:57:43.13] I was actually a physics student and switched into computer science after that. It was the thing that made me say, “This is it. This is the stuff I want to do.” Like, not just software, but building companies and startups.
[01:57:56.07] So I’d say for anyone that’s thinking about it in that way, or is curious, or has been like “I don’t know where I’m going to fit”, but the way I’ve talked about the way we work resonates with them, I would at least be down to chat with them, and kind of either - maybe it is a good fit, or just kind of hear their story. It’s really easy to get in touch with me; you can DM me on Twitter also; I have my DMs open. Or email me. I’m just Michael [at] WorkOS.com. But we find people like that end up being good fits. They don’t have to be a trained salesperson, but if you come in with that perspective, and you’re willing to really learn, and you have some kind of experience in your background, you can really do extraordinary, extraordinary things.
Well said, Michael. Very captivating. Yeah, we have come a far way from talking SAML, that’s for sure.
So it’s seemingly boring, Michael. Not that it is, but you make it seem very fun in terms of how you’ve thought about the organization. And you seem very thoughtful. I really like a lot of the ways you think. I don’t know how you got so wise, or maybe you’ve just made a lot of mistakes and you’re not telling them all yet… Something. But you’ve got some wisdom behind you, and I appreciate that.
Well, let’s hope I keep making mistakes, at least some of them; keep having a few misses, keep it interesting. But no, I think there’s a lot more than meets the eye with WorkOS for sure, and this company… And I don’t know, that’s kind of one of the fun things. Like, anybody can go make some machine learning AI thing look cool, or make it different – you’re trying to make something there. But I’ve always thought it’s kind of fun to find product areas where other people aren’t working, find somewhere that’s novel, and bring a fresh approach to it,, and I think when you do that, you can have just a giant impact on industries. It’s really cool what small groups of people can do.
For sure. Anything left that I haven’t asked? I know that we could probably talk for longer, and you may even have more to say, and you’d be willing to say it even, and that’s cool with me… But what’s left unsaid? What did I not ask you that you’re like –
I think you should probably cut me off. [laughs] No, there’s a lot more in store for us. I’ve had a pretty amazing journey and just been really lucky to have – honestly, that’s what I feel every day when I wake up, it’s just like fortunate, like lucky to do this… I mentioned it before, that it’s like a pretty big privilege to have people invest in me, and give me capital to build the company. It’s kind of – it’s insane in some ways to have that kind of privilege and resources. But I’ve been talking about WorkOS this whole podcast, and me, but at this point too I really want to emphasize, I’m just like a small part of it, actually, in terms of the company. I’m not building the product anymore. I’m incubating new areas and getting stuff spun up, but it’s kind of like spinning plates on a stick and then handing them off. And the people that are actually really doing the work that’s leading us to support hundreds of customers and grow and scale is the team we’ve built. And so I’d certainly be remiss if I didn’t give them a shout-out across the board there. Both managers, and then even just people really doing the day to day work. That’s really the secret to it, is people, and I am not only lucky to have that kind of investment from folks to build a company, but I’m really lucky to work with the folks that we have on staff. It’s pretty remarkable. So…
…just thanks to all those people.
Yes, yes. I’m glad you said that. Thank you again for coming on today and sharing your story, and just sharing the deeper details, and all this wisdom you’ve got, and for thanking your team at the end. Not just being “Hey, this is me.” “This is us”, right?
It was my pleasure. Thanks a lot.
Thank you, Michael.
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