Illinois Institute of Technology , Electrical Engineering & Computer Engineering
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How did you get to where you are today? What incidents and experiences shaped your career path? What inspired you to work on this startup idea?

Based on experience at: Chairman and Founder, Rubicon Project
Summarized By: Jeff Musk on Tue Sep 15 2020
um, Rubicon Project, interesting enough is now called mag nights. Um, in earlier this year, the company acquired another company. There's also a public company, A to that time actually transitioned out of the chairman role. Um, so you're currently just kind of looking back on the past 13 years of achievements that the team has made. Um, it's been just a really wild ride, and I'm so proud of the team and what they've accomplished. Um, So I guess you'd answer the question of how do we get to where we are today? It's been quite a roller coaster ride. You know, we started the company early on with with nothing, um, group through multiple rounds of financing. We acquired a whole bunch of companies along the way. Private companies, public companies. We took the company public back in 2014 on DSI. It's been interesting to see all the different changes that have happened, not only in the advertising market, um, in the technology market, but also just around the world. Right. So we founded the company in 2007. 2000 and eight, if you recall, was the financial crisis. You have a banking crisis. Um you know, obviously today we're dealing with co vid and all the implications of that eso it's what of the things I think that's been really important for the company of the team is to really just be adaptive. And back in 2007 when we started the company, um, one thing that we kind of instilled in the DNA of the company was that we're gonna march 10 yards of the time in good times and also in times of struggle. And it sounds obvious to do in times of struggle, right to say, Hey, let's just keep moving forward. But really, that discipline comes in when markets are growing really fast. When there's a lot of opportunity around you to maintain the discipline to not go too fast. It's easy to get excited to say, Hey, let's grow faster. Let's hire another 100 people. Hey, let's go acquire this company, but you really got to maintain that discipline. You're both in good times and bad, and I think the companies maintain that in their DNA since 2007. And I think that's part of the reason the company's been able. Thio continue to grow and do so well and, you know, in the ups of the markets in the world and also the down paths as well.

What is the elevator pitch of your startup? What problem does it solve? How were your customers solving their pain point before your startup?

Based on experience at: Chairman and Founder, Rubicon Project
Summarized By: Jeff Musk on Tue Sep 15 2020
the elevator pitch was that we created in exchange toe automate the buying and selling of advertising to basically do exactly what NASDAQ did to bring efficiencies to the financial service stock trading market. But to bring that to the advertising market, eso the problem that we become projects now magnet solves is that we're bringing efficiency into a market that used to be very manual. So advertising has been around for, you know, over 100 years and the way it was operating before waas by people picking up the phone, having meetings, everything just a very manual process. Eso Imagine what it was like. Thio Book a flight or reserve a hotel room before that process was automated. You have to pick up the phone, call American Airlines. You wait on hold for a really long time, you'd speak to an agent. You'd say, Hey, look, I'm looking to go from from Chicago to Salt Lake City and um, you know how much is it? They say, Well, it's $800. It's a middle seat, and the only thing that's available is a red eye flight, you say. Well, no, thank you. You hang up the phone you called Delta go through that same process, hang up the phone call United. That's what advertising was like before Rubicon Project's you Now bag nights, um, came in to automate that process. So just like you could go online, you click a button book, a flight. You could go online through services like you trade and powered by NASDAQ in the back end exchange Andi by sheriff stock. That's what the company did before the advertising market. You could go on. You figure out the advertising you wanna buy, and you just It's a completely automated process now.

Can you walk us through your first few weeks when you started working on this project? How did things change over the next few months?

Based on experience at: Chairman and Founder, Rubicon Project
Summarized By: Jeff Musk on Tue Sep 15 2020
so interesting enough that we started the company and probably a very non standardized way. Um, one thing that we knew and, you know, ironically enough looking at all the changes have happened the mark in the world over the past 13 years. Um, we said, Look, there's a lot of things that are going to change. The product's gonna change. The market's gonna change, The economy is going to change, the customer needs are going to change. The business plan will need to change. We know these things will have to happen over over the years. Uh, and those things are all your relatively easy to change. But the most difficult thing to change is your team. And to change the culture of a company. Thio, change the DNA of the way that company operates. Eso the very, very first thing we worked on was not a business plan was not a product plan. The very first thing that we worked on was a culture plan. We talked about What kind of culture do we want this company? Thio have What kind of people will be the right fit for for this type of endeavor? How do we want those people to work together and behave, um, in in the good times. How do we want them to behave in the in the challenging times and eso? The very first thing that we put together was was a cultural plan. And one thing that we did early on is we managed culture like a product. We had a roadmap for the culture. We measured it. We talked about how we wanted to to grow and how we wanted it to develop. We got feedback from the team. We got feedback from our customers. We got feedback from our board, and we continually tried to adapt and grow that culture and had that same discipline that we had Aziz you would with a business plan, a financial plan or a product plan. Um, and for a while, we haven't had a product manager whose sole job is culture. There were the product manager of culture. It was pretty interesting and unique thing to do, but But I'll say this forever. It was really the key to our success, especially when you're looking at way acquired a bunch of companies bringing in the DNA of those those new companies into that culture and also being willing to adapt that culture and come up with the universe in to version three, opening up offices around the world, 28 offices around the world, you're being able Thio, adapt the culture of the company to regional cultures. It was really, really critical thing that we did early on, and I think is you contributed greatly to the success of the company.so way literally had a roadmap for it. Right? So we have, like, version one, version 1.1 and the things that it focused on, where things like productivity, for example Um, yeah, we did some of the things like, uh, we provided free lunch to the team. And ah, lot of people like that is just a nice perk or benefit. We measure that in terms of productivity. Eso, for example. One thing that we did was one time way told the whole company. Hey, look on this particular Thursday, we're gonna donate the food that we're gonna provide for lunch to the team. We're going to donate that. So we're not gonna provide lunch. And, you know, the team, of course, was supportive of that because it was for a good cause. But what we did was we measured the productivity productivity of the tape. So we saw when people were leaving that day for lunch when they came back. Um, and when they left for the day, And interestingly enough, what we found is that a lot of people just didn't take lunch. Yeah, they may be took some small snacks, but what they did was they left early that day because they were tired. Um, they were not as energized s. So we took that. You multiply that by the number of days the number of hours the amount of productivity team had. And we found that the 4 to $5 that we spent on lunch was actually benefiting the company. You know, in terms of productivity of 40 to $50 and eso productivity was one of those things. Certainly the happiness of the team. Um, the growth of the team. Like how How quickly could we hire people? How many of those people came from referrals with within the company? We looked at things like retention. We also looked at things like like meeting productivity. One of our engineers, we have this focus on trying to get people to meetings on time and, uh, easier said than done. And we did a study on it. And part of our cultural roadmap became that if you have a meeting scheduled at nine AM and that meeting scheduled to go till 10 a.m. and then you have another meeting scheduled at 10 a.m. And it's on the other side of the building. How are you possibly going to get to that meeting on time? Right? It's It's not possible to have a teleporter, right? So it might might take five minutes, seven minutes. You know, people might stop and grab a cup of coffee or some water or go to the bathroom. If you look at that seven minutes for every single meeting, times 78 meetings, whatever it is per day times 1000 people. That was a very expensive problem, right? So what we started saying is that we shipped shifted the focus in our culture product roadmap to say, Look, uh, what we really need to do is we need to end meetings on time, right? In fact, we need to end them five minutes early. So we change the calendar and say, Look, you can't schedule one hour getting you could schedule a 55 minute meeting right over a 25 minute meeting. Eso we measure things like that. We put that into the roadmap and sometimes you involves training. Sometimes it involves updating technology. You know, sometimes it was just stating a goal that everybody gonna rallied around. But we found that those things really increase productivity and they sound like small things. Right, But, um, we said, Look, if we can increase our productivity by 1% right, Uh, the company was doing a billion dollars a time. A billion dollars of sales, right? 1% of a billion dollars is a pretty big number, right? So if you could do that, you could continue to improve your 1% every month, every quarter. That really can make a huge, huge difference in the success of the company.

What were the challenges in building the initial team and how did you overcome them? How did the team's composition, dynamics, time, and resource commitment evolve?

Based on experience at: Chairman and Founder, Rubicon Project
Summarized By: Jeff Musk on Tue Sep 15 2020
eso. So look, we we had big ambitions from the very beginning Thistles the fifth company has started on. You always want to do something. You're bigger and more successful than the things that you've done before. And it's kind of a bit of a double edged sword because, you know, when I was much younger, started my first company. You ever just kind of expect you to fail, right? So there's no pressure. You don't have any self pressure. And if you if you grow and you win, you feel lucky, right? And then later on, when you get to your fifth company like, Well, you know, now there are expectations. Investors have expectations. I have expectations. The people you bring on the team have expectations. Eso itt's kind of a really interesting mental dynamic, Um, when you when you start off that way. So when we built the initial team, it was really about trying Thio come up with a mix of people that had Yep, both experience, of course, whether it's in the market or building companies. But we also wanted to bring in some of that sort of your naive in a good way, that kind of naive, hungry talent that doesn't really know what winning or losing looks like, because, um, they're less afraid to make mistakes. Uh, if you think about like, when your child and you want to jump in a pool you don't think about, you know, is the pool cold? Do I have a towel waiting for May you just say, Hey, this looks fun. Let me go Jump it right As you get older, you think differently about these things, right? So we wanted to bring some people in that were just kind of really hungry on drily have that kind of mix in the organization on. That's how we how we formed our initial team. Yeah, we had some people with deep experience in technology on Ben. We had some people who had never worked in an office before. Um, and it was amazing seeing these people grow and seeing the way they work together because the people with you know, the experience would become your mentors and teachers to be people that didn't have the experience in a particular industry or in technology. On the flip side, you see the energy of the people on by the willingness to take risk and the people who didn't have the experience and hadn't made the mistakes before. I mean, it really helps, you know, the organization ground. Um, in terms of how the team evolves, this was just fascinating. This is one of the most challenging things I've ever had to do because this company grew so fast, we went from $02 billion in sales and manage revenue in less than five years. We went from, uh, one office Thio. I think it was 20 offices in six or seven years around the world, half of our business. You came from outside of the U. S. We processed. We went from processing, you know, transactions to a trillion transactions per month. Um, in your just seven or eight years, right? So the technology scale, the pace of this company grew the geographical spread of the company, the acquisitions that we did eso we constantly had to evolve the team into it. One is the way that the team was configured, right? So called the order chart eso the way people work together. We're constantly kind of refining your chart, right? Because once you become an international business, that's a very different way. Thio operate the business that if you're just operating in 11 office without getting in all the details of things you have, you could go in into, like a matrix organization you could go into, like a hybrid matrix course organization. You could have more of a traditional structure where everything kind of reports back to home base. You could have each of the offices have their own general managers. Um, and we tried a number of different configurations, um, to figure out what was optimal for the company at the time. Um and and they were really kind of two modes of the company continued to operate it. You know, one waas fast growth and innovation mode, and then the next waas your growth and maintenance mode because you can't just constantly be throwing their products in the end of the market, you can't be constantly growing as fast as you can without kind of stopping and saying, Hey, where's the line for profitability? Eso We kind of flip between the Hey look, let's launch a new product or two run into the market, let's grow in scale and then let's take a step back and say, Hey, look, is this working? Can this be profitable? Can we grow the profitability of it? Not just the top line revenue. Eso would operate in these two modes. Um, and we'd have to either move people around for those modes or we have to hire new people, right? So the person who could manage 7 to 10 people is very different than that person you could wrap manage 11 to 200 people. Um, you know, having said that, it doesn't mean that you just keep hiring the people that can manage 1 to 200 people because those people, while extremely talented, um, they may not necessarily be the people that are the most agile right, because they're really good at scale and process. But they not may not be wired to be scrappy. These two thoughts are almost opposite of each other, right, because when you're scrapping, it's like, you know, let me make mistakes. If something doesn't work, let me throw it in the garbage and start over and make something new the next day. Where's when you're trying to build process? You're trying to build process that you can can grow and scale for the long term. So we we constantly have toe Either balance the team by bringing in scrappy people to balance the people that are more process people or, you know, vice versa, right? We're kind of scrappy mode. We need to bring in some. You know, I called it adult supervision to make sure that that everybody was operating efficiently and smartly and making the right calculated. That's

How did your venture get its first professional funding? What were the challenges and how were they overcome? How'd your fundraising efforts change in subsequent rounds?

Based on experience at: Chairman and Founder, Rubicon Project
Summarized By: Jeff Musk on Tue Sep 15 2020
four. So s so interesting. And if we have the kind of the benefit and also the hindrance of starting this company from day one with funding, Um, I I ran into literally I was jogging one day. Um, and I was in my neighborhood and turned a corner, and I ran into an investor I had known for a long time and respected and he said, You know, what are you doing these days? I said, Hey, I'm just tryingto take a little time off focus on charity organizations. You're trying to do some good for the world's. And he said, Hey, you know, why don't you start another company? I said, Yeah, I'm not sure. Maybe not right now. Um, he said, Well, let's talk about some things. Look at the markets And we did. We looked at the advertising market, really found that there's some inefficiencies that we need to be solved in the market on. We ended up kind of deciding to start the company almost together. Hey, provided the funding. Um, I went and created a business plan, put together a team, and we kind of pulled it together, so kind of an unusual, unusual way to start a company. Um, most would probably say, Hey, that's a great luxury. You know, you could start day one with funding on bits. True, that's that's very true. On the flip side, though, when you start with money, you're more inclined to spend that money, and you may not be ready to. Right? So you might, uh, paying people more than you normally. What if you didn't? You know, if you were starting with nothing on, do you might attract different people. When you do, you might, by a server that's a brand new server for your Davis Center instead of you something a little more scrappy, which might make you not make your coat as efficient as as you could have. Um, so and also you're starting with expectations, right? So it's kind of like one of those things where it's not like, Hey, I'm gonna go develop a business plan. Get some validation of that business plan may be developed prototype. Get a few customers to validate that prototype on, then go raise funding to go Scale it. You know there's a discipline that comes with that. There's a hunger that comes with that. There is a fire that comes to that. And, uh, yeah, on the flip side, it's by starting with funding. It's Hey, look, you better go find a business for that works. You better go create a products that's going to scale. Um, and you like it? It was a big enough market, and we had a lot of experience in this market. So you end up working on making sense. Um, but, you know, one of those challenges was thio overcome was Hey, look, we need to operate this. This business is that we don't have money. We need to operate. This business is that we don't have resource is, um, you know, easier said than done. But one of the big challenges that we have to overcome early on is that even though we started with this funding, we started the company and the middle of 2000 and seven started you built the products, got a lot of great customer validation. Um, we launched our products. We start in stealth mode. We ended up launching our beta and day one of the beta. We had 500 customers sign up that very, very first day and we're talking huge companies like Fox, CBS. Uh oh. Well, and, um uh, it was great and exciting. However, when that happened was like, Oh, now, like, now we got to go chase demand. Um, and we got to go scale. We gotta go hire people quickly. And we got to go put servers online quickly. Again. Wonderful, wonderful problems. Toe have. And we were very careful to really develop the right product. The right plan. Um, but going from kind of stealthy startup mode now, all of a sudden, going to super scale mode, uh, then we're very lucky to have the funding because we didn't have to go and spend resources and time raising funding and were able to just go. You run as fast as we can with the demand. Um, but we still had to maintain that same discipline. So as I answer to my very first question, you know, marching 10 yards at a time. Even though we have 500 customers sign up, we said we said, Look, it doesn't make sense to go sign up 500 customers and make them all unhappy. Right? Let's go make 10 happy and then go after the next 10 and then the next 20 and then the next 30 in the next 40. And let's go scale smart eso We really have to have that discipline all the way throughout, starting with money, uh, seeing high demand. And then right after that, high demand came in was the 2000 and eight financial crisis. You're watching banks collapse. Everybody around you is laying off people. Nobody can raise funding. Um, I should say nobody, but it's very challenging to go raise funding. Everyone just became paralyzed, right? And at that time, we also said, Look, just because the world is kind of imploding from a financial standpoint, all all around us, if we really believe this is the right products and this is the right market fit and our customers really need this, this product, um and we really feel like we've got the right plan. Then we should continue to march 10 yards of the time. And we did just that. And in hindsight, hindsight's always 2020. It turned out to be the very, very best thing that we could do because what That what happened was when these when the when the economy kind of compressed. It was driving everybody to go find more efficient ways to operate their business. And if you think about advertising, you know, oftentimes advertising is the first thing to get cut right when companies were trying to go compress their budgets like, Well, let's go, uh, cut the advertising budget because we're not investing in growth. Um, the interesting thing is that people don't cut their advertising budgets to zero right, because they still have to advertise because they still have to make money, but they had to go find a much more efficient way to do it. So we're trying to change this. We have 100 year old structure of people doing business manually to now using something Elektronik and changing behaviors. One of the most difficult things you could dio. However, the 2000 and financial crisis became that forcing function that force businesses to say, Hey, look, we need to do more with less. It became a well, let's go try this new automated way. You know, they're they're laying off media planners. They're laying off ad sales people and boom, like all of a sudden down, our business is taking off because people had to go. They're leveraging now technology and the exchange that we created to operate their businesses more efficiently. So if it wasn't for the 2000 and financial crisis, I don't think the company would have been a successful as quickly as a zit Waas. So you know, it's kind of a long answer, but it was a very interesting story to see how how it develops. I think the government says that a crisis is a terrible thing to waste. I think the same thing can apply tow company sometimes right? That can be your magic forcing function if you've got the right products to bring efficiency to the market.

How did you set the scope for your minimal viable product? How did you get to product-market fit? How did your product evolve over time?

Based on experience at: Chairman and Founder, Rubicon Project
Summarized By: Jeff Musk on Tue Sep 15 2020
uh, this is probably the easiest question. Eso I'm an engineer. I'm pretty binary with things. Um, you know, to me, data drives everything and s o I went out, and I personally talkto 100 customers. Um, one on one. I talked to 100 customers before we started the company. Before we hired a single person Before we came up with a product plan. Andi, I asked him a very simple question. That was what's your biggest pain? And, um, you use that answer to basically say OK, well, let me just come in and solve that pain. Right? So, uh, there wasn't a whole lot of guesswork. Um most of them had the same similar pain, which was that it was just too difficult to buy and sell advertising. Um, so we we then use that and said, Well, then we went back to those 100 customers and he said, Look, here's what we're thinking. We'll solve your pain. Um, will it if the answer is yes. Great. Would you use it if the answer is yes. Great. That's what you pay for. And then eventually became How would you pay for it? So, um, coming up with the right product was was very simple was just just ask what the customer needs, right? In terms of product market fit, we got to that same thing. The interesting thing, though, is that, um when we first launched our product, we gave it away for free and, um and it was it was great. You know, we went back to the customers and said, Look, we just want to make sure the product works. Andre said, Well, how much is it? And they said, Well, we don't know yet. Let's just make sure it works and serves your needs and very quickly. After a few months, the customer said, Well, hey, look, we'd like to use it more, but we're worried that yes, if it costs too much or if the finance if the pricing model doesn't work for our business, we don't want to get too attached to the product. So what we found is that people were limiting their use of our products because it was free, which sounds crazy, right? But we're talking a big giant companies, right? It's very important to their business. Um, so then we just have figured out the right pricing model put it out in the market. And it was funny. Once we started charging, our business took off again on grew. So, uh so it was really interesting as well. But But the short answer to the question is we just ask the customer every step of the way and we listened, and we talked to a lot of customers before we took action.

Who were your early users? What marketing channels, approaches, and marketing tools did you use to contact users? What worked and what didn't?

Based on experience at: Chairman and Founder, Rubicon Project
Summarized By: Jeff Musk on Tue Sep 15 2020
so the early customers were local to us. The company is based in Los Angeles, and, um, it was really important to us to go work with customers that we could drive down the street and have one on one conversations with, um, we also wanted to make sure that these were good people at the organization's right. So it's one thing to say Hey, I've got Yahoo is a customer who I've got New York Times is a customer. Um, sometimes the wrong customer can really mess up your business early on. If you start chasing features and developing a product for a very specialized customer or an extremely demanding customer or a customer who is not going to give you the feedback that you need to evolve your products, it could really send you down the wrong path. Eso We wanted to make sure that the individuals at these companies were people that we thought were smart people that we thought were like, Were they people that we would hire? You were the questions were like, Were they were they people that we put on an advisory board? If the answer is yes, then those are the right kinds of customers that we wanted to work with. Um, we also wanted to throw in some extremely demanding customers. Um, your people who are really smart, but not necessarily nice, right? Because I think a lot of people wanna, um it's easy to be nice that it is toe tell somebody something that they don't want to hear. Eso We picked some customers that early on that we felt like we'd really challenge us and push us. Um and you know, turned out to be really good because, um, they did. They did that and they told us what was wrong with the products. And interestingly enough, slight diversion. Uh, even though my hair is a lot longer than it was when I was running the company. E tell people the story all the time. The best haircut I ever had was when the guy cutting my hair started with Hey, what did you not like about your last target? And I said, That's a really interesting question, because usually it's like, you know what? How do you want me to cut your hair? You. Would you like to be part of this way or that way on you just said, you know, what did you not like about your last haircut? The reason I mentioned that is because people are very quick to look at a product or a business, and they can quickly identify something that they don't like and that could prevent them from buying it. They may not like the colors. They may not like the features. They may not like the way it's presented. But if you could solve that problem first by taking out all the things that somebody doesn't like, it's far easier to go and iterate on the things that people do. Like eso we oftentimes very early on just said, you know, what don't you like about the product? We have meetings just completely about that, and we wouldn't let them tell us what they did like. We just just tell us what you don't like. And it really kind of changed the conversation, right, Because people naturally wanna you say nice things and and tell you, you know, the nice things about the product, especially when they have nothing to lose, right? They're not invested in it, so s oh, that was a big, big portion of our product development strategy

What changes would you attempt in customer targeting, acquisition process, and marketing tools in the later growth phase? Why?

Based on experience at: Chairman and Founder, Rubicon Project
Summarized By: Jeff Musk on Tue Sep 15 2020
Yeah. Actually, this is a great question as well. And, uh, having a dial back my memory over 13 years. Now, Um, when we launched initially, we didn't really know who who is gonna have the biggest pains in the market. We launched this that we launched the beta invitation, um, to everybody. And we had everybody from your huge fortune 500 companies to people who ran small blocks. And, uh, you know, the needs of those customers obviously are very, very different theme the demands, the revenue potential, the profit potential. Very, very different characteristics of these thes you have such a big spread, Um, and part of what we wanted to do in this beta launch was really figure out who had the biggest pain who are the best customers for the long term. But also do we need a have multiple versions of the product? Should there be a light version should there be a enterprise pro version and what do those things look like? And it is interesting, cause at one point we had 5000 customers within the first six months of launching the product, um, and again, you, everything from Fortune 500 us. Somebody had a small block, and one day I had a screaming customer call asked to speak Thio whoever was in charge, uh, customer service person brought their cell phone because we're working on cell phones at the time over to my desk, and this guy was saying, Hey, look, we need to get our payments sooner. I need to make my mortgage payment and, um yeah, then e just gotten out of meeting with News Corp. You know your own Fox, your big, giant giant company on The Wall Street Journal, etcetera. Right. So, like, I go from your yes, big meeting with Rupert Murdoch Thio you somebody who waas, you know, asking if they could get their payment your four days earlier so they can make their mortgage payment right on, Ben. You know, the next day, uh, there was somebody's don't joke customers. Mom called, and it was a 16 year old blogger who was making a million dollars plus a year off of advertising, and his mom called because the kid couldn't get a bank account. Thio Thio deposit the checks that were writing Thio eso itt's very. It's just amazing. Like the spread of this We ended up. I know this sounds sad and ridiculous, but we ended up letting go of 4000 customers. Uh, just so we could focus on the group that we felt like you had the biggest pain. Um, And by the way, those 4000 customers weren't the largest customers. Some of them were. You have a 16 year old kid who had a blogged making a million dollars a year, right? So, um, it wasn't all driven by revenue. Was really like, Who are the customers that can help us make the product better? Who are the customers that we can make happy? Because those customers will tell their friends about the experience that they're having eso We fired some big customer. I'd say fire, but we let go of some really big customers in some really small customers. And it was really about just making sure that we could make the customers happy, because then we felt like we could build and grow off that reputations everything. Andi, especially in markets. You know, what we found is that your good word moves pretty quickly. But if you do a bad job that were, it moves like wildfire through through an industry

How'd you hire, incentivize, and track the progress of your sales and marketing team including agencies and part-time workers to scale user base?

Based on experience at: Chairman and Founder, Rubicon Project
Summarized By: Jeff Musk on Tue Sep 15 2020
you know, I'd say the way were really careful to put the right goals in place. Um, in my philosophy and goals is that goals are for the right people. Right? And the key words here are the right people. The right people wanna win, right? So the goal is not something where Hey, you set a goal. And you said you said something out there for someone toe really stretch and achieve. And they push themselves extra hard to get to that. Right? The right people are gonna do that naturally, right? The right people wanna win, right? If you've got a superstar basketball player who's at the free throw line and is about to hit the game winning shot and, uh, in their their mindset like they want to hit that shot, right, there's nothing in the world that they want to dio. Then make that shot. Right. Um and if you just sit there and say, Hey, look, hey, make that shot. Make that shot. Make it, Make it. Don't miss that shot, right? Like all you're gonna do stress that person out there, Probably gonna miss the shot, right? So? So goal should be supportive. Onda again. The right people are gonna want to hit their goals and they're gonna they're gonna wanna win. So we set this early on our culture around goal setting was about, Hey, let's set goals so that we know if we're winning or losing right. It's a very simple thing. And it sounds, you know, it's almost too simple. But like the right people want to hit those goals. And if they're not hitting their goals, you don't want them to feel bad about it. You want the organization look inward and say, Well, hey, what are we doing wrong? Um, and sometimes that wrong might be that we set the wrong goal, right? Uh, using my previous example, if we have 5000 customers and you set a goal to say we want 6000 customers, that could have been the worst thing for the company because we would have brought on 1000 of the wrong kinds of customers who are going to set the company in the wrong direction. And you may be impact our profitability or maybe even ruin our reputation. Right? So it was odd we went from setting goals to say, Hey, we want to go from 4000 to 5000 customers in the next goal became here. We wanna go from 5000 to 1000 customers, right? So three important thing was car in the right. People on been working on that goal setting together. So we knew together. Are we on the right track? Are we setting the right goals? Bond? Also, understanding goals can change, you know, based off of what we're trying to accomplish together is a is a team. Eso That's how we we tracked the progress on banned the incentive. When we created incentives, they were certainly around the goals. But we also creating incentives around making sure that people set the right goals. So it sounds silly, but a portion of their of their their compensation. Waas was in goal setting and making sure they're setting the right kinds of goals that were aligned with what we're trying to do and also rewarding them from recognizing when those goals needed to change

Who were your competitors when you started and how did the competition evolve? How did you create a competitive advantage and a unique selling proposition?

Based on experience at: Chairman and Founder, Rubicon Project
Summarized By: Jeff Musk on Tue Sep 15 2020
Yeah. So, uh, our competitors, the small company called Google you may have heard of them. Uh, we're definitely a glutton for punishment. We came into the market. We said, Look, we want to provide technology thio Everybody who's not Google on provide them with the similar better capabilities that Google's created for their own advertising business. But to automate the buying and selling for your the rest of the Fortune 500 customers who are not Google eso. You know, at first, Google was probably like, Hey, you know, that sounds cute on, but they didn't pay attention to us. Um, and then eventually they did. And when Google pays attention to you, um and then they go and they bought a company called Double click for, you know, for a billion dollars. You look at that and say, Hey, um, that's great. I think we're on the right track. But at the same time, Google's now you can invest billions of dollars. Thio tryto put us out of business. So how did that involve? Well, um, the interesting thing was that, uh, fortunately, because we really focused on trying to create network effects in our business. Because if you really can capture network effects in a business. It's really hard to just go throw money at trying to disrupt that business. Andi, that kind of gets back to you know why we have a product away for free. In the very beginning, we're trying Thio get customer basis on both the buy side on the south side of our business. Data data is invaluable. Um, and we tried to invest in those things early on, knowing that a company like Google would would take aim at us. Right? Um, it turned out to be a really great thing that we did, because our our solution of trying to provide technology, everybody who's not Google, end up creating such a market in our platform toe where if Google wanted to reach consumers via advertising on on Fox or CBS or NBC or The Wall Street Journal three only way to do that was to buy advertising through our platform. So now Google competitors ER has also become Google customer and Google such a giant organization that those two groups started to talk to each other right on. You've got antitrust issues and things like that, that kind of work towards your favor. But it was a really interesting dynamic because Google went from being our number one competitor, er toe being our number one competitor, er and also our number one customer. So talk about a dynamic right s. So we needed to find a way to where it's like, Hey, Google. Um, even though we compete with you, we really are good for you and the business. And we kind of found this good kind of harmony with Google networks out. Well, it was this kind of cautious relationship. But then, oh, man, uh, then this company called Facebook comes along, launches a big head platform. Yeah. Yeah. Who spent over a billion dollars buying companies Microsoft's you spent? I think they acquired a company. For there is billions. A company called aQuantive. So now the Senate is like, Okay, we compete with Google, Facebook, Microsoft A. Well, well by companies for a billion dollars. So we're competing. These companies are investing billions of dollars. Um, and by the way, all this company is also became the customers of ours. So this is really interesting dynamic in trying to manage that. But what we what we wanted to do is we wanted Thio try to show the market that look, having an independent provider was good for the market because number one if the market grows everybody benefits number two as long as we're competing, but also enabling these companies, Um, yes, they might be losing some potential on one side of the business, but they're gaining potential on the other side of the business. You know, that ended up working out well, but then the best part, I think, was we turn the competition story to them, talking about them competing with each other. Eso were like, Hey, look, you know Google Amazon is trying to get in your business or Hey, Facebook. Microsoft's trying to get in your business, but we could be the platform that ties all of you guys together into a fair and efficient open market and really focused on being an open market and trying Thio be Switzerland as much as possible. You really help the business grow and trying to leverage these giants eso they weren't solely focused on trying to crush us into Hey, how can we work together and trying to have open conversations and and look, there are humans that these organizations Where? You know, if you if you come in there and your arrogance and you tell them that you're gonna destroy them Um, yeah, those humans, we're gonna you wanna you and their missiles that you But if you talk to those humans like human beings and really talk about how like you really do want to work together and how you can help them, then those humans want to help you. So, you know, talking to people like humans. Um, it kind of takes away the you the the giant nous of these companies and really humanizes them.

What were the major exciting and memorable moments? Were there also any moments that almost got you to quit? How did you get past them?

Based on experience at: Chairman and Founder, Rubicon Project
Summarized By: Jeff Musk on Tue Sep 15 2020
look, taking the company public was exciting. Things is the second company I've taken public. Um, the first company was on NASDAQ, the second company. This one was on New York Stock Exchange, and, uh, they're both great exchanges, but the New York Stock Exchange has so much history. When you walk into that building, you just kind of felt like who else is kind of walked through these doors? Who else stood on this platform and you rang the opening bell? Um, that was super exciting. Turned out to be right around the same time as my dad's 60th birthday. So way had a little mini birthday party for my dad and, uh, at the New York Stock Exchange s O that was That was really neat. So it was very personal, Um, but very exciting in terms of the memorable moments, you know, it's been really neat, is seeing what people have done after working at the company. Um, that's when you know, you really brought in some special people, right? Like, you know, you like to think that you're gonna create a great team within your organization, and they're gonna work together, and they're gonna go out and all that kind of stuff, but really saying what people's journeys look like after leaving Rubicon. Project Thio, start a new company or create a new products. Some people went on to create charitable organizations and schools, and, UM, it was just really need seeing how how those people were not only just good human beings that wanted to do good for the world, but also just really good quality talent that were. You have the skills to go off and create something in the road, and you develop their own teams and their own businesses in their own products and things like that. So, yeah, huge, I think, measure the success of the culture and the business eyes. Really the sum of all the successes that they went on to go achieve after the company. If that makes any sense, you maybe it's like being a parent where it's like, you know, you're kind of rearing your Children, but really, your success of them was really when the golf on their own eyes, maybe the best way to describe it, um, in terms of whether moments where I almost wanted to quit, uh, like I want to say every day. Um, but it was It was It was challenging, right? I mean, going through the 2000 and financial crisis, taking a company public is just a beast. Um, you're having thio having to change out your team, even if it's the right thing for the company. You know, you're dealing with human beings. Um, and that part I I really dislike that part. Um, you're just dealing with some of those people issues and having to let somebody go. Who's you're talented, and you're really a really great entrepreneur or executive. But the company's needs change, right? That's one of the most difficult things to do is when When you know, the company needs something different. And even though that person's working so hard, has been with you for 10 years, um, and wants to do the best job possible. They're just simply not the right skill set anymore. Right, Um and you know, it's the right thing for the company, But you also know it's the right thing for that person. Um, every time I had to do that, they be want to quit? Uh, yeah, it z easy. You go the easier thing to do and say, Hey, you know, I just don't want to deal with this and either not do it or you quit and let somebody else deal with it. Right? Um, how did I get past those things? I think it really came back down to that culture plan, um, that we created in the culture. It's like, Look, I've got an obligation to serve. I've got an obligation to serve every single person in the company. And interestingly enough, every time I felt like I wanted to quits or I felt like I couldn't go any further or every time I had to make a really, really tough decision. You know what I thought about? I thought about the first person I had to go fire. I thought about the 1st 10 people had to go fire. And I said, You know what? For those people, right? So who still may own stock in the company or who made a sacrifice and cannot be here anymore? It's for those people that I'm gonna continue to make these tough decisions on that. I'm gonna continue to go on. Um, because if I made those really tough decisions that were hard, hard for me. Hard for the company, Hard for those people. Then I owe it to those people to keep going and keep doing it and keep making those tough decisions. Otherwise, it was all for not right was all not worth it. And I'd be doing a disservice. Thio all those people and all the people to come.

How did you set the scope for your minimal viable product? How did you get to product-market fit? How did your product evolve over time?

Based on experience at: Founder, StrongView (formerly StrongMail Systems, Inc.) - acquired by Selligent
Summarized By: Jeff Musk on Tue Sep 15 2020
s O. That was a very interesting time. There was early 2000 thistles after the dot com bust, where all these dot com companies were employing imploding. There was this kind of shift towards brick and mortar type companies. Um, so strong view, we we looked at just the trends that were happening in the market. And what we found was that there was this huge growth in in email. Um, nothing sexy, right? The email has been around for a really long time, and what we found is that a lot of this brick and mortar companies, uh, Bank of America, Citibank, Verizon, American Airlines were communicating with their company with their customers via email, and they were sending you tens of millions of communications. Very emails. It was bank statements, uh, flight notifications. Um, uh, your customer service messages on recalls, product recalls, whatever it might be, um, it sounds like a very simple thing. It's like, Okay, Well, uh, emails been around for a long time. Why is this a problem? Um, well, that email, uh, systems that these companies were using were built for me to send an email to you, and you send to send an email to May. They weren't built to send tens of millions off emails. It was open source software. It was free, Um, by the way, competing with free, It's not always easy, but you have free. Sometimes you get what you pay for. And we came in and we said, Hey, look, let's commercialize this right. Let's go take, uh, this standard old process, which is really the post office where people are sending paper communications. Onda Let's go modernize that by creating hardcore, high scale, safe, reliable email infrastructures for companies were sending tons of emails to there to their customers with very critical communications, you say? Well, you why can't you just use the open source software? Well, one is. It was very expensive to scale to it wasn't secure. Eso imagine your bank statement being over, you know, sent over open source software. Three is it wasn't trackable. You don't know if it went through etcetera On for the really interesting thing is that, um you might think if if 1% or 2% of the emails never make it, that's not a big deal. But the money that a company would save by sending their bank statements or a bill. Let's take a company like Verizon. 18 T Um, you might save $3 by sending that bill over email instead of your putting a stamp on it and saying it in the mail. Um, but if someone doesn't pay their bill on time because they never received the bill over email, if you're talking about a $70 bill that's not being paid for 14 days or 30 days on DNA, you're having a set of paper email. Anyway. Someone's calling into a call center, which will cost you 5 to $10 now instead of $3 to send the paper. And you're not getting your $75 for 15 or 30 days later, and you have an unhappy customer that's far more cost right? So companies weren't leveraging email because it was You're not as reliable. Ascending the paper statements, um, so how do we get to our minimum viable product? It was, Well, look, what's the minimum that you need to be able to send these emails securely, safely, reliably etcetera to where it's not gonna cost you money? Um, instead of you just saving saving money, Um How did evolve over time Your interestingly enough again talking about forcing functions of the markets. Um, the forcing function there was the dot com bust where again, you know, economies imploding, stock markets declining, cos they're having to go save money. Uh, so that was the forcing function that got them to change from sending these your archaic paper statements like they used thio now doing it digitally over email and taking whatever risks or making whatever changes and investments and things like that. So that caused that business to take off. And you again, leveraging the efficiencies have been needed to be created in the market on day, we just kind of followed. You know, that that evolution over time, people like what we want to track it. People were like, Well, we want to send it more securely. You got encryption. More reports and things like that so just really followed what the customers wanted. Thio 12 Chief

What were the major exciting and memorable moments? Were there also any moments that almost got you to quit? How did you get past them?

Based on experience at: Founder, StrongView (formerly StrongMail Systems, Inc.) - acquired by Selligent
Summarized By: Jeff Musk on Tue Sep 15 2020
no, such a long time ago. Well, we moved the company. That was memorable. Um, where we moved it from Los Angeles to Silicon Valley, which is a really tough move. I grew up in Chicago, so I don't really have any loyalty to Los Angeles or or Silicon Valley. Um, but we raise some money from Sequoia Capital. Uh, quite obviously the investors beyond companies like Google and LinkedIn and Yahoo. Um, you said the greatest companies in the world And I remember just having a conversation with them, and they said, Look, you could build the business in Los Angeles. Um, and this is different than how it is today, right? So back then, access to your capital in Los Angeles wasn't wasn't that great. There was a lot of investors. There weren't a lot of companies there that would buy our products. Andre said, Look, you could build a company in Los Angeles, but, um, Silicon Valley's where all of your clients are, um, Silicon valleys, where the enterprise software people they're gonna need to hire are, um And they also said, Look, if someone's gonna acquire this company, it's probably gonna be a company in Silicon Valley. Um, so moving the company was it was a challenge. Um, personally, but also, you know, we had employees, and not all the employees could come along for the journey. They don't wanna move that families. Um, so s so that was pretty memorable. Literally. We're putting, like servers and files in the trunk of my car. And I drove it up Thio to Silicon Valley, so it was kind of memorable of your very memorable in that that's from that standpoint. Um, so one of the other questions were there any moments that almost made you quit? Um, so, uh, this is a really interesting business. I started it. Um, I started it, and I funded it. Um, but I wasn't running it at the time. A time I was running an incubator, there was starting a number of different ideas, funding a number of ideas. Um, and this was one of them, and this was the one that kind of This is one of the ones that really just kind of took off. It was like, wow, look like all these companies now, because of the dot com bust have to move from. You have to save money but moving their paper communications to electronic communications and said, You know, now is the time to really jump in this thing. So I ended up jumping in, running into CEO, raising the funding, moving the company. But I told myself and I told the board I said, Look, I'll do this for two years on then after that, I wanna hire in the CEO who really has the experience in the Enterprise software world who loves the enterprise software world. It wasn't a passionate month like I love building cos I loved the team. But building in a press software for email on these infrastructure servers eyes an engineer was it was an incredible challenge, which was motivating but wasn't a personal passion of mine. Um, so I guess in terms of like quitting, my plan was always to quit. Uh was kind of a weird way toe kind of start things, But I did just that almost to the day I ended up staying on with the company. Well, the you're hiring a CEO and then staying on because I just wanted to help when it was one of most difficult things ever, because a lot of the people that you hired may not like the decisions about CEO Mix, and they're coming to you. Anyway, um, I might not like the decisions that CEO makes, but I've got to support that CEO but also support him internally to the rest of the team s. So it was kind of a challenge emotionally. Thio do that. And I did it, Um, but I would never I would never wish that upon somebody else because you essentially just become the company therapist. At that point, everyone who is not happy about the decision is gonna come to you and you want to support you know, the decisions the companies making. But being company therapist is not a, uh, not a very motivating job in any company, unless you're trained to do it, I guess.

How did the school prepare you for your career? Think about faculty, resources, alumni, exposure & networking. What were the best parts?

Based on experience at: Electrical Engineering & Computer Engineering, Illinois Institute of Technology
Summarized By: Jeff Musk on Tue Sep 15 2020
all right. It was so interesting. So I went to Illinois Institute of Technology. It's studied electrical engineering, computer engineering. Um and, uh, I had to work to put myself through school. Um said toe pay for my own tuition and to pay for my own books had to pay my own living expenses and things like that. So I was working three jobs while I was going to school. Um, and, uh, the good thing is, being an engineering students, I was able thio get exposure, Thio engineering jobs and internships and things like that. And I was like, Oh, this Internet thing, What's this all about? Um and, uh, yeah, this is before companies like Google even existed and s It was interesting to get that exposure. I didn't learn anything about the Internet in school s. I was learning assembly language and COBOL and you had nothing but like, uh, contributed to the started my first company where I was coding stuff in Pearl and I bought a book for $20 called Learn pearl in 21 days from Barnes and Noble. Um, and, uh, that's a two nights of being motivated. Thio learn that probably learn more than my assembly language coding. Having said that, I would not have been exposed thio all of this if I didn't. Um if I didn't choose that path in school, if I didn't have to work three jobs, I didn't I wouldn't have had to go started coming and go find a more efficient way to make money to support myself. It was really kind of started. My first business was like, Well, we need to find a way toe, pay my bills on Guy can't work three jobs and study at the same time. So how can I do this more efficiently? Um And then, interestingly enough, even though I racked up all this debt to go to school, I dropped out with four classes left. Um, so probably not the best success story for school. But had I not had those experiences, I wouldn't have been able to go start a company. I wouldn't I wouldn't know what a t one line connection Waas. I wouldn't had a modem thio connect to the Internet. I wouldn't have known that you Pearl was a more efficient coding language to go build websites than you know than assembly language. So it was It was a great great foundation. Um, and it was also, you might think, Hey, it's kind of tough to just go drop out of school. Um, and it's probably cliche right now. Thio do it, um, to tell that story. Uh, but the experience, I think just really kind of prepared May to really go do it on. But also, I think you're making decision to drop out of school is a really, really tough one on you got to make sure that you feel so strongly about it that it's the right path for you. Um, and by the way, this is not a pitch for dropping out of school schools. Great evidence should stay in school. You're gonna learn a lot. There's always time. But, you know, in my particular case, it was a great foundation and really was the launch pad for for everything that after that