Acquired - Acquired Season 3 Episode 7: Venmo (live with Andrew Kortina)

Episode Date: October 29, 2018

Ben & David are joined by special guest and Venmo cofounder Andrew Kortina for our first-ever SF live show! In front of a packed house we chronicle the journey of how two freshman-year roommates from Penn turned a healthy obsession with Craigslist and a fake podcast into an app that facilitated $17B of payments last quarter alone, producing not one but two landmark acquisitions along the way!Note: the audio quality is a little rough due to some A/V issues at the live show. We apologize!Sponsors:ServiceNow: https://bit.ly/acqsnaiagentsHuntress: https://bit.ly/acqhuntressVanta: https://bit.ly/acquiredvantaMore Acquired!:Get email updates with hints on next episode and follow-ups from recent episodesJoin the SlackSubscribe to ACQ2Merch Store!Carve Outs:Kortina: The Myth Of Sisyphus by Albert CamusDavid:  Startup by Jerry KaplanBen:  Halide on the new iPhone XS camera and computational photography

Hey, Acquired listeners, we have a big announcement today. We're launching a bonus show. For $5 a month, you can become what we're calling a limited partner and get access to it. And for those of you who know or are googling the term limited partner, we hope you like our creativity on the name. We're excited to use this new format to cover all sorts of things that don't fit into our normal episode format and dive deeper into a lot of company building topics. Our first LP bonus show is on the jargon of what venture capitalists say and when words don't just mean what the dictionary says they mean. We've covered some great ones, including sideways, credible, and I know this is David's favorite, not raising right now. Always a fan favorite uh so we are super excited about this not only because it'll give us an avenue for creating more types of episodes which we've been wanting to do for a long time um but because it'll give you guys a way to support

the show and help make it even better so to date on acquired we've plowed every dollar we've ever made right back into the show better equipment equipment, software, ads, travel, etc. And we're going to continue to do the same here, which we think will really take things to the next level. If you'd like to become an Acquired Limited partner, you can click the link in the show notes of your podcast player of choice or go to kimberlite.fm.acquired. That's K-I-M-B-E-R-L-I-T-E dot F-M slash acquired. And with that, on to the main show. Welcome to Season 3, Episode 7 of Acquired, the show about technology acquisitions and IPOs.

I'm Ben Gilbert. I'm David Rosenthal. And we are your hosts. Today, we are doing another oft-requested episode, the Venmo acquisition, first by Braintree and then shortly thereafter by PayPal. We've been waiting until just the right circumstances, which we finally had. The show you'll hear on this episode was recorded at our very first live show in San Francisco this week with special guest Andrew Cortina, the co-founder of Venmo. Now, we had some AV issues at the live show, and very long story short, the only recording that we have of the show is from

an iPhone that was placed on the table in front of us. We sincerely apologize for the audio quality. We know it's not quite acquired standards of the episode, but we decided that the content in the interview with Cortina was just way too good not to release to everyone. So who is Andrew Cortina? Cortina is a consummate entrepreneur. As you'll hear on this episode, his constant stream of startup ideas and passion for nailing the experience led him to start countless projects from Filafunk to Venmo, both of which we will get into today. To give you a sense of his varied talents, he started his college experience as a CS major at Penn, but after feeling that he could learn more programming outside the classroom than in, he switched majors and ended up graduating with majors in philosophy and creative writing and minors in computer science and logic. He has since gone on after

Venmo to found Finn with Sam Lesson, which we will talk about later on this show. So get excited to hear Andrew Cortina. Okay, listeners, now is a great time to tell you about longtime friend of the show, ServiceNow. Yes, as you know, ServiceNow is the AI platform for business transformation, and they have some new news to share. ServiceNow is introducing AI agents. So only the ServiceNow platform puts AI agents to work across every corner of your business. Yep. And as you know, from listening to us all year, ServiceNow is pretty remarkable about embracing the latest AI developments and building them into products for their customers.

AI agents are the next phase of this. So what are AI agents? AI agents can think, learn, solve problems, and make decisions autonomously. They work on behalf of your teams, elevating their productivity and potential. And while you get incredible productivity enhancements, you also get to stay in full control. Yep. With ServiceNow, AI agents proactively solve challenges from IT to HR, customer service, software development, you name it. These agents collaborate, they learn from each other, and they continuously improve, handling the busy work across your business so that your teams can actually focus

on what truly matters. Ultimately, ServiceNow and Agentic AI is the way to deploy AI across every corner of your enterprise. They boost productivity for employees, enrich customer experiences, and make work better for everyone. Yep. So learn how you can put AI agents to work for your people by clicking the link in the show notes or going to servicenow.com slash AI dash agents. All right, now on to the live version of David with the history and facts. So David, you want to take us in? Yes. So Andrew, you went to Penn for undergrad, and your freshman roommate turned out to be very faithful in your life. What was the first time you met Ikram when you moved into Penn? I was at school like a week early because I was like one of the IT support desk people.

And there was like our training for you know that team or whatever so I was there a week early and like kind of already like out drinking and partying every night and so when I first met Ikram I was like hungover asleep at like 1 p.m in the afternoon and he rolled into our room with his whole family with like this van full of people and like all this shit. And there's like a tennis racket stringer and just all this crazy stuff. Like why would you possibly have this in a 10 foot by 10 foot dorm room? And just like a caravan of people. And I was there kind of just with my computer.

And I was like, all right, I'll let you guys kind of like move in and do your thing. I'm going to go like hang out at the gym or something. And then I remember we went to Kmart to like get shit for our room, like, you know, supplies and stuff. And we like I don't like shopping. And so like I was like, OK okay like i'll get like a refrigerator like you get a microwave or something and i remember we were there for like i don't know like three hours at kmart i was like what the fuck are we doing at kmart for like three hours here and that comes towards the end i was like you know i'll just like take this mini

fridge on the subway back it'll be fine and they're like no like it's it's cool like we're about ready you shouldn't have to carry that in the subway um yeah anyway so that was like kind of like all right great question david uh what i'd like to know is when was the first time that you started hacking on stuff together and thought, hey, maybe we could start a company or at least a project together? I mean, one thing we did was we convinced somebody's dad or something to let us redo their website and just build something, some sort of CMS with PHP and charge them way too much money for it. But nobody really knew how to program and we scraped something together, which wasn't really a consumer product. It was more like a swindle. This wasn't like 1995 when nobody knew what websites were, right?

You were actually hustling people because this was the mid-2000s, and you could build a website, right? Well, I mean, we could kind of build a website. I mean, one could build a website. I don't know if we could build a website. It was definitely possible. But in our senior year, we both loved Craigslist.

I'll tell you a good story about the microphone after I tell this story. So we both loved Craigslist and we wanted to do like a, the first kind of like consumer product we worked on, I think it was our senior year,

with like three or four friends, we built this thing called My Campus Post. And the idea was, it was a classified site for college students and everybody could like verify that they were transacting with somebody else at the college and so there was this kind of like trust layer baked into it that you wouldn't have if you were using craigslist and we had like a launch party for that and nickram's band played at the launch party and just like all these like flyers that we put everywhere and like like all of our

friends were like in all the dorm rooms like shoving flyers under you know every door that they could which was like totally not kosher with the university uh but i think we heard that like the half.com guys did that we actually we got a lot of people to sign up for that but the problem was the seasonality of it. It's very hard to retain a set of college users on a classified site. So Craigslist. Ikram and I both love Craigslist and we wanted to meet Craig Newmark after college

so Ikram sent him an email and told him that we had a podcast, which we didn't. He was like, responded to it. And so we flew to San Francisco to meet him and like did no preparation or homework or anything. And we were like, we had no equipment. We had no equipment. Boy, that sounds familiar. And like, we have these laptops that like like, would just, like, overheat and turn off. And so we emailed Craig Newark and we're like, you know, can we come interview you? And we met him at some coffee shop on, like, the Twin Peaks, because I guess he lives over there.

And we showed up and it was like, oh, went there too we were like we need a microphone so we went to like best buy and got like we were looking at microphones we saw this usb microphone that said like podcaster microphone and we were like oh we'll get that one it'll look legit and we showed up and just like after you know like 15 minutes of hardware failures we were we finally get into the interview and Craig Newmark is super pissed off at this point. And then Ikram just starts asking these rubbish questions that are just not at all researched.

And he was just like, what the fuck is this? It was hilarious. So from that inauspicious beginning, so I feel like a lot of people, if they don't know you, and they don't, well, we don't know you either, but we've like a lot of people, if they don't know you and they don't, well, we don't know you either, but we've done a lot of research on you. And they think about Venmo. They're like, okay, two kids from Penn, you guys must've started this like around this phase. Like it's easy to imagine you were going out for beer, you were splitting pizza, you had to split

expenses from that Kmart trip, but you actually did a bunch of stuff after graduation before Venmo. One of which was you worked at an early Y Combinator company, both of you. You guys were the first two employees at, I think, or first couple employees at I'm In Like With You, which became OMG Pop, which became Draw Something, which became Zynga. How did you guys, two kids from Philly, get hooked up with a white combinator company? Craigslist. Nick from Sawy job posts on Craigslist, and was like, oh, these guys, this sounds like a cool company.

We should move to New York and try to go work with these guys. And so we took a bus up there and met the two founders, chatted with them. And it was like not really a formal interview process. They were just like, yeah, you guys seem smart. Come work for us. And they're like, we were totally like not qualified for this job for like real software engineering.

But it was cool. We like joined, learned a ton, worked with like, I mean, that team was incredible. It was like some of the smartest people I've ever worked with, that original team. It was really, it was really awesome, but we worked there for a while and it was like this dating website and then they pivoted to do casual games and we were like, ah, that's not really what we signed up for. We're going to go do other stuff. So you were at, I'm in like with you, uh, Ikram was at Ticket Leap. So Ticket Leap ends up being an important component in the founding of Venmo,

or at least as far as I can tell, the initial capital. Can you tell the story of how all that went down? Well, so Ikram and I both had part-time jobs when we started Venmo. Well, we had full-time jobs. Then we started working on Venmo in nights and weekends. Then we kind of like transitioned to part-time as we got a little bit further. And we wanted to get some like advisors who knew how to build a company involved. And so one of those advisors was this guy, Chris, who is the CEO of TicketLeap. And then there was this guy,

Sam Lesson, who is a friend of mine, who had both started companies and were like early advisors. After we had spent many months working part time, getting progress, getting some of our friends using Venmo, they encouraged us, oh, you guys should go work on this full time. And then the first investors were Sam and his dad, And they helped us kind of like find people to put together an early round of financing so we could quit our jobs and go work full time. And we should say, Sam is your current co-founder at Finn, Sam Lesson, who was, was he running drop.io at that point? Yeah. Which ended up being, I think Facebook's first acquisition. It was either first or, like, second or third.

And then that, let's jump ahead into Venmo. He ends up being super influential to you guys, not just as an investor, but as product feedback and in terms of building the news feed within Venmo, right? How did that happen? Well, he actually wasn't really involved in the news feed part within Venmo, right? How did that happen? Well, he actually wasn't really involved in the newsfeed part of Venmo. He was more involved in this feature that we had called Trust,

which was, it was like friending, but more powerful, where you could, like, if I trust you on Venmo back in the day, then I could just take money out of your account without you having to do anything. It was like, it was awesome and like highly efficient

and a cool relationship. Marriage. Yeah, it was like marriage, but without all the legal stuff. It was sweet, but obviously it got shut down immediately after PayPal acquired us. The news feed came out of like, Ikram and I,

when we started Venmo, we had Blackberries and we would use Venmo instead of text messaging and Blackberry, I don't think, even had threaded text messages

and so like, our whole text message screen would just be payments that we were making through Venmo and it was like, all this cool shit that we were doing,

like going to bars and restaurants and concerts and things. And we just thought like, oh, this looks like interesting content. We should just make this part of our app. And so one thing that we skipped over a little bit is the initial idea for Venmo. I take it Venmo wasn't,

gosh, you know, it would be great if anybody could transfer money to any of their friends at any time right off the bat. It feels like there was a little evolution there. How did it start and how did it get to a social payment app? Yeah, we worked on a lot of different things. Like one of the first things that we did was, this was before Square had their point of sale software.

And so one of our friends was starting this yogurt shop, like a Pinkberry, and it was called Yogarino. And so like Yogarino needed a point-of-sale system and we felt like we could build a better point-of-sale system than anything that existed so we built this like browser-based POS with a USB credit card swiper and we thought maybe we would like do that as a business but we didn't really like the idea of having to go like door-to-door to sell point of sale systems so we decided not to do that

another thing that we wanted to do was um make it so you could like if you go to um like a small free concert in a bar they they don't charge for tickets but then they'll do this thing where they pass the hat and when where they pass the hat. And when they pass the hat around, everybody kind of like throws in a couple bucks. But if you're a musician, you know, like this is like a super shitty way to make money. And if you have a band of like five people, you make like maybe 70 bucks and five people have to split that. It's really like peanuts.

And we thought it would be cool if you could just, like, text money to the band to support them while you're at the concert if you're just, like, feeling a track. So we worked on that for a little while, and that's kind of how we got into, like, okay, we should, like, figure out how to make something where we can send text messages and, like, charge money. That, we were working on that for a while,

and then there was this day when Ikram was visiting me in New York and he just didn't have any money on him. He wrote me a check to pay me back, and we were like, this is stupid. We used all these other apps to do everything else. None of our friends exchanged money with PayPal. It feels like we should be doing that, but if we're not, something is clearly broken, so why don't we just go solve this problem that we are experiencing right now? And that was kind of like the initial idea.

So then we went and kind of like, went back to find a computer and do some research, and I saw this, because you guys sent me this note about OboPay, and we found this company called oboe pay Looked them up and we're like man. Oh, we'll pay us raise 70 million dollars to do like phone payments This is like we're too late I mean then we looked at their website and was like all these people in suits and a really shitty website that obviously no one was gonna use And so we're like, yeah, okay, we can compete with OOPay.

70 million ain't nothing. So you guys have this great slide. You end up raising a seed round for Venmo of $1.2 million, and you have this slide in your pitch deck. I assume you had been pitching the idea with the band payment idea before then. You cross out... Oh, yeah, that was a cool start. Your original mission was Venmo enables musicians to accept payments for songs, merchandise, and subscriptions via SMS. And then what you guys did is you crossed out a bunch of words in your mission in the slide deck, and you put, instead, Venmo enables anyone to accept payments for

anything, anytime. And, uh, that, I think that's just like such a super cool, um, like so many startups that, that I've been involved in and we see is like Rover is a great example. In the beginning, Rover was like, when you're out of town, when you're on vacation, put your dog with a real family, uh, instead of in a kennel, great and that was rover's first chapter right but then we started talking we were like rover is actually about being the best dog owner that you can be and there's so much more than that and like kudos to you guys like you figured it out and that kind of unlocked the big vision how was uh so i'm curious like when you were pitching venmo before versus after like how did that how did that change reactions from investors uh one thing i remember about

pitching was we pitched this guy and he was like i only want to invest in home run opportunities and nick was like and he was like like it doesn't make sense to invest in anything other than a billion-dollar company. And Ikram said to him, well, we're going to make a trillion-dollar company. And then he just laughed at him, and I was like, man, that's not cool. So I remember that about Fundraiser. For context, Venmo did $17 billion in transaction volume last quarter. So, you know, pretty close. Yeah.

Well, I mean, that's, yeah. So that's not the market cap, but, yeah. So raising money for Venmo was just like, it always sucked. We were always like, you know know there was always like some law changing where we needed tons of money immediately or we like couldn't pay people or we would like be violating some law and be ended up in jail if we didn't have enough money which is never a good position to be raising money in um so basically anytime we did any sort of financing, our vesting would get reset and we would get horrible terms

and it was just like, shitty. And to walk folks through what that looks like, at least what the recorded history of Venmo's fundraising is, is about 1.2 million in sort of an angel seed round that Sam invested in and that some others. And then your series A ended up being, I think, $7 million. And that was led by, was that RRE? No, Excel.

Excel. Excel. So, you know, big first institutional venture capital firm investing. And then, you know, at this point, you guys are growing like crazy. Can you talk about growth as it relates to how are you guys making money and how are you dealing with growing so fast, but from my understanding, not bringing in nearly as much as you were burning on how fast you were growing?

Well, I mean, Venmo never, while I was there, we never made any money. It was just like, we would just be spending tons of money processing transactions. But the idea was, you know, you get enough people on there and then instead of charging people to pay each other, you charge businesses to accept payments from people that have Venmo,

which is, it's like the PayPal model. But we were never making money when we, you know, back when I was there. So it was, you know, that was like another challenge with that fundraising situation we always found ourselves in. So Venmo is like inherently viral from the very beginning. Did you ever try and stop growing so fast? Because the faster you grew, the more users faster you grew the more users you got the more engagement you got the more money you were losing to interchange fees especially on the credit card side uh well if we research about all this stuff was very intentional um i remember that there's this

picture of uh this guy straight out to their first employee with it he was holding like this poster uh uh south by Southwest and said, you're already on Venmo, you just don't know it yet. I love that. So the idea of a dark account is a great thing if you're trying to grow really quickly. What was the other part of the question? So the faster you grow, the more transactions that happen, the more money you lose. Yeah, well, there are definitely people that said that.

We were always like, why would you want to grow slower? But we would definitely try to, like, we did lots of stuff to reduce the spending. And so we would always want, like, more user growth, but lower COGS. And so early on, we had a lot of people that were doing payments to each other with credit card transactions, and the fee to us for that was something like 3%. And users don't have to pay. No, we were just subsidizing all of that.

And so it took a bunch of work to get a banking partner that would list your ACH transactions at the volume that we were doing. But then that really significantly reduced our unit economics and the cost of processing transactions. And so there was this point where we were just spending way too much money processing credit cards. And one of our board members was like, why are you spending all this money? We should be doing this through bank payments. We were like, yeah, that's a good idea.

We'll reduce the cost. So it took a bunch of work to kind of get everything cut over the bank. We killed a bunch of these users that were like from sites such as flyertalk.com, which is this like credit card points hustling, you know, underground network, which is probably something like this on Reddit right now.

It's like all these people that are just just trying to max out their credit cards. And there are some people... So they were essentially running at the points through Venmo. Yeah, and there are some people that thought that the only users we had were these credit card users. And we're like, no, we'll switch people on the bank, which we did. But we happened to do that transition right before we went to raise our Series B, and we've had two or three down months of growth to get through this transition of killing all these crappy users and retaining the good users and getting everyone to move

into the bank payments. Growth was picking back up, but it was just like not an opportune time to do this transition. So VCs are now looking at you for your Series B and they're like, you guys aren't making money, you're losing money on every transaction and you're not growing. Yeah. Which leads into the first acquisition of Nemro. Great treat, but actually before we get to this, Jenny would be very upset with me if I didn't bring this up, so I have to, and now is the right time.

Can you tell us a little bit about John Graham, who joined Venmo? I believe he was employee number five. Yeah, John, when I met, for those of you, I mean, I guess everybody knows who John Graham is. I definitely didn't before getting to research. Yeah, John Grant, he was on The Bachelorette. A famous lawyer famously claimed on this season of The Bachelorette to have invented the mobile app for Venmo. No, he created the Venmo iOS app. So, you know, his lawyers looked at that one. We're not recording, so, you know.

Yeah, no, but, so he was on the back line. But John Graham, we met him through this guy, Matt Hamilton. And Matt Hamilton is a guy that went to Columbia who, when Igram and I were on the street getting a cup of coffee, or coming back from getting a cup of coffee, and we both had on our Venmo t-shirts, and this guy Matt Hamilton sees us and is like, oh, Venmo, I love Venmo. And we're like, yeah, cool, we made Venmo. He's like, what? Awesome. And we're like, yeah, what's your story? And he was working on this thing called Tourbee, which was like an Airbnb for tour guides type of thing where you could have local tours, show you how to do cool stuff. And we were like, yo, you should come work at Venmo. And if you're a software engineer, he's like, well, I'm working on this other thing, but I have a bunch of friends you should hire. And so

he introduced us to John Graham and this guy Jesse Mentor, who was John Graham's freshman year roommate in college. And those two guys ended up working for us. And he also introduced us to this guy, Julian Connor, who he went to high school with. We hired that guy. Then we hired this guy, Adamas, that Julian went to high school with also. Then we hired Matt Hamilton himself. Then we hired Matt Hamilton himself. Then we hired Matt Hamilton's co-founder, Torgy, David Fasson, just like all these Columbia kids.

And so within a year of... So John Graham deserves a lot of credit for working with him. Well, there's no Matt Hamilton. There's all Matt Hamilton. John Graham comes from Matt Hamilton. So from this random encounter on the street, we hired like 10 kids from Columbia

just because we were wearing Venmo t-shirts. I feel like there's a lesson in there. We did all this non-traditional hiring stuff. Nobody knew what Venmo was except for a few people. It was not the type of place you go where it's like all these great engineers you can learn best practices from. It was like a total nightmare. What do you mean? Yeah.

Yeah, so. We're going to be scrappy. So, okay, given that, you've been scrappy. The series that could be fundraised isn't going well. Samir from Excel is on your board, right? Yep. Excel is also the main VC in a Chicago-based payments company called Braintree that is, in a lot of ways, the other side of the coin of what you're doing, where Venmo is working with consumers.

Braintree is up and coming. This is pre-Stripe days, where Stripe had just been founded. Braintree is the payment processor for merchants on the internet, so it's still to this day. Uber, Airbnb, a whole bunch of other, you know, companies we all know and use process all their payments through Braintree. And for anybody who is using, who's building web apps or, yeah, I guess web apps would be the thing, and trying to accept payments before Stripe, before Braintree, you'd use companies like Authorize.net, you'd try and cobble together some kind of payment gateway. It was like an unbelievably difficult problem to accept credit cards on the web,

let alone in mobile apps. And so Braintree comes along and it's frickin' revolutionary and now we even have Stripe. It's no wonder it's a $40 billion company. Something currency. But how, so how did the, I'm assuming Braintree was not on of your guys radar. No, we do great we

So actually we were pressing credit card payments through first data on the yoga Reno account because we took it over The over shop because we could nobody would give us a credit card processing account So we use that but then we were using Braintree to process ACH payments. What you're using for people who are getting their out of Venmo.

We were using the Yogarino. No, we were using the Yogarino account to accept credit card payments. And then we used Braintree to distribute money back out via ACH. And Braintree to distribute money back out via ACH. And Braintree did that a little bit early on, and then they kind of shut down.

And we were the last customer. And we would get calls every month, like, you guys really need to get off this ACH thing. We're sunsetting this product. And we're like, we're working on a bank deal. Just give us one more month to figure something out. And for probably like a year, we were just like... So they're basically your creditor.

Yeah, they were just doing all this ACH processing for us. So we knew them well, and they did a lot of nice favors for us to not kill that product while we were relying on them. So how did the acquisition talks go? My understanding is that Bill, the CEO of Braintree, was a huge tamper for you guys and bought into the vision. Yeah, I mean the... Samir just introduced and was like, you should go talk to the Braintree guys.

I think it would be a good conversation. And we kind of just missed the first meeting. We're like, well, we have first aid and the process credit cards. What are we going to talk to Braintree about? And after we missed that meeting, Samir was like, no, just go talk to Bill. So we went and met him, and he was talking about how they had all these merchants, but were interested in a consumer wallet type of thing and we had all these customers and wanted to start making money by allowing the customers to pay merchants um and just kind of got into this conversation where it's like oh we have this

kind of we're both trying to get to the same place from different sides um maybe we should try to do it together and this was right around the same time when also we had been trying for many months to raise a Series B with no success. We're just running out of money. There was the point where there was like, the only money left that we had had to be kept in escrow in order to comply with some law in California. And so we were like totally out of money and then no, there was no investor that wanted to do anything.

So it was either shut down the company or sell it. And we had an offer from Groupon for like a million bucks or something shitty like that. We talked to the guys at Square and they were like, nobody here is actually an engineer, why would we acquire you guys? I see you talked to Facebook, given the same connection at that point.

Same story at Facebook, nobody, well, I mean, the Columbia guys all passed the engineering. But not to Facebook. No, definitely not. Yeah, and then Bill was like, yeah, how much do you guys want to sell the company for? Let's do it. It was even to the point where we were missing payroll and he just wired us a bunch of money before that, before the deal was closed, to meet payroll because their CFO was trying to get the Venmo books to balance. That didn't even happen before PayPal acquired Venmo.

This is so funny. This is kind of what I assumed the story was, but this is crazy when you think about it, taking a step back. Bill is basically, Bill Henning, and he's now the COO of PayPal, is basically the only person in the entire startup and venture ecosystem that sees the potential for what Venmo is today. Despite all the warts, right? Yeah, yeah, yeah. Bill Garland, he's an amazing dude. I mean, there would be no Venmo without Bill, for sure. It's great. So I feel like...

I got one question. How did you land on the purchase price of $26.2 million? This is a good one. You never be the first person to throw a number out there. It's just a stupid thing to do. But we were talking to these guys from Braintree and they were like,

well, how much money are you guys going to raise in your Series B? And I think somebody was like, well, we'll probably go raise like $10 million. And then they just kind of like napkined it, and were like, well, if you're going to raise $10 million, this would be like the post money at kind of standard terms. And I think that's how they got to it. Back to why Bill was a believer.

We alluded to this earlier, but I think it's worth reiterating for, as Ben and I were researching this episode, we aren't deep in fintech. I think probably most of you aren't deep in fintech, and you guys are the only ones who get a good list anyway. There really is only one business model that makes sense in the long term, and that is PayPal's business model, which is, you have... That's pretty bold. Well, in the long term...

It's Visa's business model. It's Visa's business model, which is also PayPal's business model. Now, PayPal started the same way Fedmo did, with a consumer wallet, essentially. But you can't make money by charging consumers. You have to make money by charging merchants. And so thus, you need a two-sided network effect. You need a lot of consumers. You need a lot of merchants who are willing to accept this payment. And then you can charge the merchants a fee for using the system.

And it's crazy that you guys have one half of the equation. They have the other half of the equation. And actually, I guess they're really Getting to the next acquisition of Venmo. There are only two people in the whole ecosystem that's on this there was bill and then there's right Because it was less than a year later that the combined entity gets acquired by PayPal right? Yeah, PayPal will be the only company smart enough to acquire Venmo, for sure. Like, it takes a lot of, I mean, they get the business model, right? And, like, understand what it takes to kind of, like, get to the point where you can convince merchants to adopt your network.

And it is worth pointing out, like, it sounds, you know, when you're just hearing it for the first time, like, oh, they're the only ones smart enough to do this. Or, like, they were the only company that could. There was almost a revolt inside of Braintree when they were like, oh yeah, we're going to buy Venmo. I mean, a lot of employees at Braintree, and this just sort of came out of research, were like, wait, that thing is hemorrhaging cash. It's not even a real company. They're growing so fast.

There's no plan in the future to start making money. We are a payment processor. We make a little bit of money on every transaction. We have a sound business. Bill took a huge chance with his internal team and internal culture in the direction that company was going. I think it's just worth underscoring, now that everyone uses Venmo and that it's inside a big safe company like PayPal and they're doubling down on Venmo in a huge way. It seems like, you know, it was so logical.

But in retrospect, in that time, it really didn't seem like it. I mean, it's a huge investment, too. I mean, it's probably been like a billion dollars spent on transaction processing fees. So it's a big investment, but, I mean, PayPal's a killer business. And, you know, Venmo has the same sort of thousand omnibus. It's worth it. So I'm curious, when the, probably within a few months after the acquisition by Braintree,

diligence starts by PayPal for the second acquisition, how much time did they spend with you guys? I mean, what's been reported at least, and it seems in our research, is that like, Braintree is a very nice business within PayPal, and that's nice, but their biggest worry was that millennials were not using PayPal on the consumer side. I imagine there was a pretty big lens trained on you guys.

They kept us pretty, as far as they could from the... The Braintree guys. They didn't want to screw up that deal. Do you know if they were representing... So Braintree sold $800 million. Are they pitching Venmo, do you think, to PayPal? I don't know if they're actively pitching. I'm sure they're talking about...

I wasn't involved in any of the acquisition talks. I'm sure they talked of the acquisition talks. I'm sure they talked about the growth rate. But even on the PayPal side, David Marcus I'm sure got it. But I'm sure a lot of the rest of PayPal was also similar to like, we should just shut down Venmo.

Why, we already have this. We have a product like this, right? I don't think there was like a ton of talk on either side about the importance of Venmo. So the acquisition does happen. Two things I want to cover before we get to acquisition category. One, the acquisition happens,

PayPal also leaves you guys kind of alone. And the best example of this, so that some people may be familiar with this, you guys run an ad campaign in early 2014, right after the acquisition in New York, called Lucas Uses Venmo. That was during the acquisition. During the acquisition. Oh, wow. Tell us a little bit about Lucas and his use of Venmo. Yeah, so at that time,

Braintree was working with this, like, hotshot creative agency to do a big rebranding of the company as, like, super developer-focused, the operating system for payments and kind of like up their credibility. Because Stripe is on the scene. Yeah, because Stripe is on the scene. And so they were doing that

and then they're like, well, you know, we can have this agency do some paid advertising for the holidays for Venmo. And their idea was to put some ads on Best Buy and said, split the gift with Venmo or something like that. And I remember just being in our office in New York with Ikram and our creative director, Neil, and everyone was like, man, this is like,

we've never spent money on advertising and the thing that we're going to do is put ads on Best Buy? That's just really boring. I can't imagine there are many Venmo users who actively shop at Best Buy these days. Well, maybe that was part of the point. Get people in for not. Anyway, so it was like, if we're going to spend all this money on ads, we should at least do something fun, like some sort of out-of-homeland billboard type of thing.

And we were like, yeah, that'd be cool. And he's like, just keep it really simple. Like, look at Lucas. He's like drinking coffee. Lucas uses Venmo. And we were like, that's cool. Lucas is a software engineer. Yeah.

He was like a DevOps engineer. And he was literally drinking coffee in the kitchen. And we were like, like, that's cool. And so Neil, he got Lucas's picture off of the, and this is all in real time. We're sitting there, it's like 1pm, and Neil gets Lucas's photo off of the team page, and he puts a Santa hat on him, like with Photoshop for some reason,

and then puts this little banner on there that says Lucas uses Venmo, and that's it. It's just pure white background, that's all it is. And then an hour later we're in the street just showing it to people, and they're all like, what the fuck is Venmo? And we're like, oh yeah, that's awesome. And then so we're like, we have to get Bill to approve of this, and then Bill has to get PayPal to approve of it because it's an expense over $100,000. So we send it to PayPal, and we're like, where's the rest of this? Like, did you forget to, like, attach some assets? And we're like, no, that's all good.

So Bill, like, Bill was talking to me. He's like, maybe we should, like, explain what MO is on here. And I was like, no, man, you have to do it. Like, this is what it is, I'm telling you, it's gonna be awesome. I'll put it on my credit card if you guys are not gonna do it. But we have to do it like this,

because it's gonna be awesome. Dude, you are an artist. And so, he was like, yeah, and this is our awesome part of it. He was like, well, I don't get it, but I trust you guys, let's do it. And so, one of our people called the subway folks on Black Friday and had inventory during the holidays. And then we did this photo shoot with Lucas. He's wearing a Santa hat and has like his Movember mustache that's like not a very full mustache. And he's holding a watering can, and it's just weird.

And there's all these ads that say, like, when he goes to the subway, there was this huge staircase where there was a big sign above it that just said, Lucas takes the stairs, and that's it. And there was people like, who the fuck is Lucas? What's going on? And there would be like, news articles, like, reviled Venmo ads explained. Also, PayPal's a part of eBay at this point.

So like, John Donahue, big women's successor to eBay, is probably seeing this. Guys, I can't decide if this is like, or if this is like perfect product market fit lets you mess up everything else. No, well this ad campaign was really successful. There were tons of people. The amount of earned media that we got out of this in terms of Twitter, Facebook shares, Reddit threads, there were people making meme generators where you can make your own Lucas ads and share it on to your friends.

It was crazy. There was this guy, one of our team was down in Puerto Rico for the holidays and he came back and was like, yeah, people in my pool in Puerto Rico were talking about Lucas. It was insane, the number of people talking about it. And it actually, it definitely, we looked at the lift and sign-ups in New York versus like other cities, and it definitely like helped quite a bit, actually. So it worked, I mean, we had a feeling like maybe something like this would happen, it kind of far exceeded expectations, but the main reason we did it was because we thought it was funny. And we kept our attention, you know, we'd get that, like, saying, like, okay, like,

I need to go research this thing. Actually, what you would do is you would ask a friend, like, what is Venmo? Do you know what this thing is? And that's kind of how it worked. Well, I think that's part of why I brought it up, A, because it's a great story. But B, like, I think as we were doing research on this episode, one thing we kept hearing from people is that, yes, you guys had product market fit, right? But it wasn't like, even though with all of the twists and turns along the way, it wasn't like overnight Venmo just blew up. You guys actually were really scrappy. You were out, like when you came up with the Lucasuses Venmo campaign,

you guys actually went out on the street and tested that with people. Yeah, we tested everything on the street. And you were always out telling people to use Venmo. I think it's just such a good story, right? Same thing happened with Airbnb, right? A year and a half in Airbnb, Brian Chesky decided to live for a year in Airbnbs. You know, like that had a big impact on the company. He came to my apartment in New York and photographed it to put the pictures on Airbnb, actually.

Wait, you were an Airbnb host in New York during that? Yeah, he came and took photos to like, because he didn't like the photos on my list. Wait, this is like two pieces of startup lore like intersecting. Everybody knows the story of Brian going to New York, living with some of the early hosts, taking pictures of their apartments.

You were one of the early hosts? Yeah. Oh my God. Yeah, I think I was cool. Like, couchsurfing was cool, too. It's like, you meet cool people through that. The only question is, why are you not an venture investor now? We'll get back to that later.

Okay, so the last thing to cover before you move on here from history of faxes, Venmo just basically has continued growing at like 20% month-over-month period, indefinitely. Do you remember when the acquisition happened, when the PayPal acquisition happened, what gross transaction volume and run rate you guys were at? Probably something like a billion annually. That's what I thought it was, but I couldn't get down that far back. Yeah, I mean,

PayPal just reported earnings last week, and the first slide of their earnings deck was Betmo's growth chart. And as I alluded to earlier, Betmo did $17 billion in gross transaction volume last quarter, which is incredible. And I believe about 10% of PayPal's entire, entire as a whole corporate entity transaction volume, which is incredible. All right, listeners, our next sponsor is a new friend of the show, Huntress. Huntress is one of the fastest growing and most loved cybersecurity companies today.

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All right, let's move on to Huntress. section. Anyway, these go faster. We categorize the acquisition. So we basically decide why, and this is sort of obvious by the time we get to this point in the episode, but sometimes it's frustrating. And we decide whether this acquisition was people, technology, product, business line, asset, consolidation, or other. And for people who have been listening for a long time, you know that that list just continues to grow. All right. So to me, the differentiation that we make between product and business line is that products get integrated into an existing business and run as a single business. So the same sort of, like you could imagine that a product gets bought by Microsoft and then Microsoft sales force goes out and continues to pound the pavement and sell that product.

A business line on its own is something that completely operates its own engineering to product to sales to marketing kind of as a business unit. And that to me is what this is because what we're seeing some really amazing sort of like PayPal is sort of saying like yeah, PayPal's the old thing, Venmo's the new thing. And they're starting to replace a lot of the PayPal stuff with Venmo. I mean it's been five years and PayPal's operating completely as an independent thing albeit subsidized by PayPal's balance sheet but I'm going business line for Venmo. Yes. I'm actually not going to pick a category. We're doing a lot of firsts tonight. My memory is not good enough to remember how we classify on Instagram. But to me, that's the analogy here, right? Like this is, Venmo is PayPal's Instagram, right?

Like there's a, it's essentially the same business model. On the merchant side, I would assume at this point, the same merchant sales force that is selling to merchants. It is just a different consumer audience that plugs into that on the front end. So modularizing the back end from the front end. Yeah. So like the merchant side, I would assume is integrated at this point, but the consumer side is completely separate. To me, just like Instagram, Facebook. merchant side, I would assume, is integrated at this point. But the consumer side is completely separate. To me, just like Instagram and Facebook. But fortunately, we have the expert here.

Yeah, let me see the categories. Yeah, the business line thing is interesting. Because Venmo didn't have any business without PayPal. It needed the merchant network. And the reason it kind of took off was just some of the product tweaks. Because it was designed for people to use with their friends, you could reduce a lot of friction that PayPal had because it was designed to transact with people you don't know. And so like the product was actually suddenly different in a way that made it

grow faster. So I think that was a product. That's an important nuance and I think one we're thinking about for anyone doing a consumer startup is that you can have a higher viral coefficient if it's between like slightly more distantly trusted parties rather than people who already have to know each other intimately because you only know so many people super super intimately. Okay, what would have happened otherwise? I think the most interesting question for me in terms of an alternate history here, and I don't know if we asked you earlier, did you guys talk to Stripe at all

during the acquisition of Miracle Round? No, we should have. It was better to have two people trying to buy your company. And they listened, number one. Yeah, that's a good, you know, we should have. No, we didn't talk to Stripe, I'm not sure. I'm not sure. I'm not sure. I'm not sure. I'm not sure. I'm not sure. I'm not sure. I'm not sure.

I'm not sure. I'm not sure. I'm not sure. I'm not sure. I'm not sure. I'm not sure. I'm not sure. I'm not sure.

I'm not sure. I'm not sure. I'm not sure. I'm not sure. I'm not sure. I'm not sure. I'm not sure. I'm not sure.

I'm not sure. I'm not sure. I'm not sure. I'm not sure. I'm not sure. But what's interesting, so if you, it's interesting to imagine a world where if Stripe didn't acquire you, because I think, my sense of brain tree was pretty focused on becoming part of PayPal or at least building this. Obviously Stripe was very focused on being an independent company. But imagine if Stripe had been, that would be a very powerful combination right now, right? Or were there things, do you think Stripe was too developer focused, like to build out a real merchant network to be kind of very demo? I think it would have been in terms of like the

products that could match. I don't know if the financiers would have had the stomach to spend like a billion dollars getting Venmo to the point where there was a big enough network of consumers to be interesting to the merchants. But like in terms of like the sort of like the match of the products, it would probably be similar to Braintree. Alright, so going into tech themes, I want to use the beginning of this section to do something we haven't done yet in this episode, which is you mentioned Square

Cash. We haven't talked a lot about Square. We talked a lot about Venmo. But we haven't talked that much about what each of those companies are doing today. And David alluded to something that PayPal has the only business model that wins in this space, the same as Visa. I want to spend a little bit of time sort of unpacking that

and trying to talk about what each company is doing and what the strategy is and trying to pattern match what's succeeded and failed across each. So Square Cash launches, so let's take a step back, I think we all know Square. Square is how we sell t-shirts in the back. It's how any merchant, actually internationally in the world, can easily accept payments and use a point of sale to spend their business. So they see that Venmo taking off and saying, oh we need to be in the peer-to-peer transaction business too. They launched Square Cash,

which is now rebranded as the Cash App. They had a value proposition around you're going to be able to instantly transfer something to someone else, which is extremely expensive because you're then paying to deposit quickly in other people's banks instead of the very cheap ACH or the free strategy of just transferring something to somebody's Venmo and letting it sit in their Venmo account. Like that's got to be the dream scenario where Dave and I both have Venmo. I'm going to Venmo you. You're going to decide, I'm not going to transfer that to my bank. And so it doesn't cause Venmo anything. And so if there's a way to monetize me when it's a closed loop where all the money is just staying in between the two of us, that's great.

Now, I want to add a little bit of color to why, David, you were saying the only business is sort of the Visa one, the PayPal one, and also why you were saying that Stripe and Venmo could be a powerful combination. Imagine you have what Venmo has, which is two different parties that are transferring money to each other and do so often enough that they're willing to leave money in Venmo. So it doesn't cause Venmo anything to have that dream scenario where people are moving money around to each other. And most of the time, if they are moving to their bank account, they're doing so in a relatively cheap way with with ECH. If you also had all the merchants on that same ecosystem where you didn't have to ever have cost of goods sold to transfer money to a bank, then you could really have a business on your hands because what businesses are willing to do is pay the interchange for that transaction. So that's sort of where Venmo is today, is where when you see pay with Venmo. What I'm trying to do there is you are both Chase or Wells Fargo or whatever, and Visa.

You're in the credit card and you're paying, so you're not paying fees to anybody. You're just charging 100% of those margin fees for portions. Right. I mean, imagine the high velocity. I use Venmo five, the average, I think, from their earnings is that people use Venmo on average five times a week who use it. So when all those payments are free, there's a 2.9% same as a credit card transaction fee plus 30 cents when you go and pay at a merchant. Now that's all sort of free money for Venmo because they don't have to pay anything to the bank until they decide to settle up once a week or once every two weeks or whenever merchants actually move money out of Venmo

and into their bank account. So they're not paying per transaction, just in one lump sum. So kind of an amazing, like if Venmo can take advantage of having this payment network and really building it out into a merchant network too, that's an unbelievable business model. Yeah, it's PayPal's business model. Yeah.

I know I'm talking a lot, but one other point I want to make here is that it's interesting how three times in a row there have been businesses that try to start in peer-to-peer transactions and then don't find a great business there and then pivot to... The multi-sided. Yeah, peer-to- commerce, like paying for things. And so if you look way back at PayPal when they started, that's why it's called PayPal, it's for people to transfer money to other people. But like really their business model is you buying stuff online and then taking a, you

know, a cut of you buying stuff online. You look at Square's first business model, great business model, they're just taking a cut of every transaction. They try and start a second business that is Square Cash. Square Cash kind of ends up pivoting to where they're really changing to be a bank rather than, hey you should transfer money to your friends with this cash app. They're really a bank for the under-banked. And we haven't talked a lot about this yet, there's a whole, probably follow-up to Square episode coming at some point, but if anybody's using the Square Cash App

you'll notice like they're pushing this debit card on you, well they get a cut of every transaction in the debit card. And so Square and Venmo are sort of taking very different strategies at this point where Square already has the merchant network, they're now with the Cash App trying to start a business where they're able to make money on the debit card side of every time one of their users makes a transaction, they make that interchange. And when you look at Venmo, yet again, what we're seeing after all these years now is lining up the merchant network, which is funny because it's one of the ideas that you guys had originally.

But really, you know, really going to that. The difference is PayPal has 2 million merchants already on there. Right. So to the extent that there's real consolidated power there. What's the terrible word? Synergistic power there. Including Uber, which is now accepting that. That was

always the idea for the business. We knew there was no business of P2P transactions. Because you're competing with hard physical cash, and there's no fees on that unless you maybe consider an ATM fee. So we never had a plan

to monetize the P2P business. It was all just a, grow that side of the network, and then once you have leverage, go get the merchants onto the network to actually start making money. Makes sense. Which I think brings us

to great, let's bring it on. So for me, I mean, I've already made the analogy, I think it's the same here. Like this is, to me this is an A for PayPal with a caveat of a future A plus

that I think is likely, which is this is the fantech analogy in this day and age. with a caveat of a future A plus that I think is likely, which is this is the fantechnology of the state now. Like, it's PayPal understands this business model better than anyone in the world. It's a fantastic business model with incredible network effects. It's a two-sided network. And they had a major problem,

which was that people who were, you know, mobile natives, quote unquote, or didn't grow up using PayPal, weren't using PayPal to transfer money. And Venmo became the way to do that. And so now it's all under one roof. But PayPal has the merchant network on the other side of the transaction plug-in, so I think this is like Without going into depth on the finances here No break minimum a and my caveat on the a-plus is just further proving out monetization of Venmo over the coming years What's funny, I'm just looking up Visa is effectively three PayPals in market cap.

Like Visa should probably be the one to be scared. Visa should probably try and make a go for PayPal. Anyway, I mean, that's not great. But yeah, David, I'm with you. I mean, I think the thing to consider here is like it's still very speculative. Like we're still in the early days because we just now are starting to see a serious effort in the last two quarters of, right, last three quarters of PayPal deciding to push pay with Venmo to a lot of the merchants on their network. We saw, I think that in the earnings report, that 17% of people on Venmo

have now participated in a transaction where they were a monetized user, which for the majority of people means they're paying at a merchant. Some others are paying the fee for instant cash out, but I think the majority of that is probably paying merchants. So there's reason to be hopeful, but I think I'm in the same camp as you now, Abe, with a future A+, but I think the

variance is high because it's definitely predicated on, you know, right now, still losing a lot of money, still responsible for a super small percentage of revenue relative to all of PayPal's revenue and it's you know it's not totally clear yet whether we're gonna be paying with with Venmo at Eberts and sell it the place. Cortina, you're probably biased but you wanna weigh in? Yeah I like that, when there's that like pay with Venmo integration with Uber where there's like the button in the app in the app, but I think it's cool that they did the Venmo card, because then that wires up any merchant that accepts a credit card payment also as a merchant,

which is far greater than the PayPal merchant network. I don't know if people will use the Venmo card, but it is another way to instantly cash out so I can get the appeal of it. It's certainly a good way to make all that balance that's sitting around pretty liquid. That's a cool thing that would have been tough to do if Venmo was independent and PayPal made happen. Cool.

Great transition to you are no longer at Venmo, of course, as we alluded to. You have now started to fit in with original angel investor Sam Lesson. Tell us a little bit about how that came about. Yeah, so after Venmo,

I was kind of doing nothing. And Sam, who sold his company to Facebook many years ago and was a VP of product at Facebook for a long time, had left and was also doing nothing. And Sam, who sold his company to Facebook many years ago and was a VP of product at Facebook for a long time, had left and was also doing nothing. And when we realized neither of us was working on anything, we thought maybe we should work on something together, if we can get excited about something. The sort of frustration that we ended up sort of like thinking about a lot was your phone you know like a lot of times when you're on your phone you're just like you end

up looking at something that you had no intention of spending time doing because there's all these like badges and fuzzes and alerts and it's designed like a slot machine to like get your attention on some screen where you know you don't look back at the end of your life and think, I wish I looked at more cat photos when I was younger. Your phone just doesn't feel like it's aligned with your goals. So we wanted to build something that realized the potential of the phone, which is very high because it's connected to all human knowledge and allows you to communicate with

any other person in the world at any time. So the delta there is pretty big. And we decided we wanted to build this idea from science fiction where you have an assistant that's an AI, tapped into your frame of consciousness, always listening, augmenting your knowledge of the world, helping you with whatever you need, but realize that today the best is Google Assistant or Alexa, probably Google, and it's not anywhere near as good as having a real assistant. So we said, why don't we build something that feels like this software from science fiction, but is actually powered by a combination of people and machines and software on the back end.

And it feels like the kind of like AI assistant. And so that's kind of what we set up to build. It's called Fin. And people kind of use it like you would use a full-time EA or personal assistant. But the sort of advantage is it's variable cost. You don't have to spend, you don't have to pay for 40 hours of work every week. You probably don't have a workload that's 40 hours every week so you pay incrementally by the task.

We can kind of help you out with whatever you need help with so you can focus on what's important. So Cortina, I know a lot of us are anxious to get our hands on FinPlay Round with it. It's going to be a car about it.

Oh, you are? Go for it. Sorry. So Cortina was generous enough and the whole Finn team to create a really cool custom deal for us tonight if anybody wants to try it out. So I'll give that to him. Yeah, if you go to Finn.com slash acquired, it'll get you a promo code where there's no monthly minimum and you get $100

credit to try it out. So just go to fin.com slash acquired. And in relation to that, did you have a car about? Oh yeah, car about. I was doing this event at Berkeley last night for some students there, and I mentioned this book that's one of my favorite books.

It's Camus, and it's a treatise on why the meaningless of life does not merit suicide. It's called The Myth of Sisyphus, and it's a really good inspirational book that I recommend. You know, listen to my notes. I was a French literature major in college, so you're close to my heart. On the next, I also have a book that I wanted to do today. I wasn't going to do this originally, but given all the problems.

A really good book called Startup by J.R. Kaplan. It's about building a startup in the 90s. The Go Corporation, which was the original pen computing company, even before the Apple do. This actually was a recommendation, Bill Merlin recommended this on Twitter, and I read it recently, and it's like such a good read. Jerry, I believe, was also a philosophy major undergrad,

I want to say. Anyway, very, very well written, and it's about just like the disaster that was building this pen computing company 20 years too early, and the wreckage that gets left, but really, really fun to read and get along with. Also, just throwback to how far we have come in terms of building startups. Not only is it going to be in the US, but funding rounds are giving up 40% of the company for a million bucks in the beginning.

It's crazy. David, do you know what the difference is between being early and being wrong? Nothing. Yeah, that's a haunting one. All right. Keeping my brief, I'm super into computational photography. I think what Apple and Google and companies are doing now that are extending, you know, the notion of a photograph far beyond, hey, what was exposed on the film through that glass and doing all sorts of really creative things to make it,

you know, the first step is make the photo actually communicate more of the experience like you were actually being there, and then layers on top of that, which has captured things that our eyes can see, but was previously really difficult to see on film. And I think that, you know, just with the newest iPhone and the newest Google Pixel 3 are just like fascinating playgrounds for developers. And one of those developers is Halide. And Sebastian DeWitt is one of the folks that works there. And he wrote an article on Halide.com called the iPhone XS or iPhone XS.

Why it's a whole new camera. And their app includes a thing called Smart Raw, which if you're a nerd about this kind of stuff, like you should definitely go read this. There's fascinating side-by-side comparisons of like, hey, I took this in Raw with the new iPhone, and then we augmented the Raw in this way. And it, you know, you can bring out these things in this photograph that you otherwise wouldn't have been able to bring out. And I think the wave that we're in is so interesting. And I think this article is written in such a way that it's both appeals to like the nerviest of us that are interested in this stuff, but it's also written in a way that anybody who's interested in exploring this area

is totally, totally digestible. So I highly recommend that article. We want to thank our longtime friend of the show, Vanta, the leading trust management platform. Vanta, of course, automates your security reviews and compliance efforts. So frameworks like SOC 2, ISO 27001, GDPR, and HIPAA compliance and monitoring, Vanta takes care of these otherwise incredibly time and resource draining efforts for your organization and makes them fast and simple. Yeah, Vanta is the perfect example of the quote that we talk about all the time here on Acquired, Jeff Bezos, his idea that a company should only focus on what actually makes your beer taste better, i.e. spend your time and resources only on what's actually going to move the needle

for your product and your customers and outsource everything else that doesn't. Every company needs compliance and trust with their vendors and customers. It plays a major role in enabling revenue because customers and partners demand it, but yet it adds zero flavor to your actual product. Vanta takes care of all of it for you. No more spreadsheets, no fragmented tools, no manual reviews to cobble together your security and compliance requirements. It is one single software pane of glass that connects to all of your services via APIs and eliminates countless hours of work for your organization. There are now AI capabilities to make this even more powerful, and they even integrate with over 300 external tools. Plus,

they let customers build private integrations with their internal systems. And perhaps most importantly, your security reviews are now real-time instead of static, so you can monitor and share with your customers and partners to give them added confidence. So whether you're a startup or a large enterprise and your company is ready to automate compliance and streamline security reviews like Vanta's 7,000 customers around the globe, and go back to making your beer taste better, head on over to vanta.com slash acquired and just tell them that Ben and David sent you. And thanks to friend of the show, Christina, Vanta's CEO, all acquired listeners get $1,000 of free credit. Vanta.com slash acquired. All right, acquired listeners, we will see you again in a couple weeks, or I guess you'll hear us again in a couple weeks. For those of you who have already joined the LP program, the first episode is waiting for you on the bonus show. And for those of you who have already joined the LP program the first episode is waiting for you on the bonus show and for those who want to join you can click the link in the

show notes or go to kimberlite.fm slash acquired that's k-i-m-b-e-r l-i-t-e dot f-m slash acquired thanks