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0:00:20 Hi, and welcome to the A16Z podcast.
0:00:22 I’m Lauren Murrow.
0:00:26 Since social distancing measures were first put in place, time spent gaming has gone up
0:00:28 75% during peak hours.
0:00:34 In this hallway-style conversation, A16Z partner John Lai joins me to talk about how the stay-at-home
0:00:39 movement is fueling gaming, what we’re playing, and why live streaming is having its moment.
0:00:44 Playtime in general is up massively across every category of gaming.
0:00:49 PC games erupt, steam, the world’s largest marketplace for digital PC games.
0:00:54 Steam has been around for 20 years and it’s never seen this level of user activity.
0:00:59 Average concurrent users online typically hover around 15 million.
0:01:04 It hit an all-time record high this past Saturday, around 22 million concurrent users online.
0:01:07 So that’s a spike of almost 50%.
0:01:09 Console games are up massively as well.
0:01:10 What is driving this spike?
0:01:15 Obviously, we’re all at home more, but what other factors are coming into play?
0:01:20 So I think what’s special about games versus other types of media is that gaming is a
0:01:24 massive activity that a set of friends can engage in at the same time.
0:01:30 There are moments of levity, competition, there are emotional highs and lows over the
0:01:32 course of a typical gaming session.
0:01:36 These are bonding moments for people and they create really deep social relationships.
0:01:40 It seems like smart game studios are also putting measures into place to encourage more
0:01:41 at-home play.
0:01:46 I know Pokemon Go changed its mechanics a bit to make it easier for people to play
0:01:47 from home.
0:01:50 It changed its events to make it easier for people to play alone.
0:01:51 Absolutely.
0:01:54 Blizzard of World of Warcraft, which is one of the largest and longest-running MMOs of
0:01:59 all time, launched a whole series of benefits during quarantine so that if you’re playing
0:02:05 right now, you actually get double experience as a way of incentivizing people to continue
0:02:06 playing the game.
0:02:09 What kinds of games are popular amid this crisis?
0:02:10 Are there particular titles?
0:02:15 One game that I’ll highlight as an example is a fairly recent one, Call of Duty Warzone,
0:02:19 which is a new battle royale game from Activision that just launched March 10th.
0:02:24 It ended up being one of the most successful and fastest growing PC console game launches
0:02:25 in history.
0:02:30 Over the course of three days, it reached 15 million players, and I think it reached
0:02:32 30 million players after two weeks.
0:02:37 I saw Infinity Ward had 6 million players in its first 24 hours.
0:02:41 I think a lot of games that are launching this month are seeing major spikes.
0:02:48 So Xbox Live, which is the multiplayer service for Xbox consoles, has had several outages
0:02:52 twice over the last week as more users logged on than the infrastructure can handle.
0:02:56 And Microsoft has some of the world’s best cloud infrastructure, so if they’re having
0:02:58 trouble with it, it’s got to be a lot of people logging on.
0:03:03 I’ve read of developers experimenting with ways to include a higher player count and
0:03:08 larger squads with all these new users, but that’s also potentially risky.
0:03:12 As you mentioned, Nintendo, Xbox Live, and Discord have all experienced outages within
0:03:13 the last month.
0:03:17 How are game developers responding to this massive influx of players?
0:03:19 Yeah, it’s a double-wed sword.
0:03:24 On one hand, you have unprecedented numbers of users coming to your servers, and you want
0:03:26 to be able to support them.
0:03:31 Increasing the number of users currently in a session is one way to try to minimize the
0:03:37 sheer number of servers or shards that you need to spin up for a game, but at the same
0:03:39 time that comes with its own technical challenges.
0:03:42 And so I think everyone’s just struggling to keep the lights on.
0:03:47 Discord announced that they had increased server capacity by 20% to keep up with demand,
0:03:52 and promptly, right after making that announcement, they had server outages themselves as well.
0:03:55 This isn’t something that’s just specific to games.
0:04:00 Netflix, for example, just cap bit rates over in Europe, so in an effort to sort of keep
0:04:06 bandwidth down, they’re no longer streaming in 4K or HDTV, and it’s clearly an attempt
0:04:10 to contain costs and continue maintaining the quality of the service in the face of
0:04:11 a lot of demand.
0:04:15 Is there anything surprising that you’ve noticed in the types of games you’re seeing played
0:04:18 more amid the coronavirus quarantine?
0:04:25 Online multiplayer games are the ones that are seen the most obvious and largest growth,
0:04:29 which makes sense because they’re fundamentally social games that you play with other people.
0:04:35 I actually think that VR, virtual reality, might be seen as surge in popularity.
0:04:36 How so?
0:04:41 Well, the whole notion of VR is predicated on enabling people to escape the real world
0:04:44 to a virtual reality, right?
0:04:48 And even prior to COVID, there were early indicators that in-home consumer VR may be
0:04:53 turning the corner, so the Oculus Quest was estimated to have sold well over a million
0:04:56 units before it went in backorder.
0:05:01 The Valve Index, which is perhaps the most powerful headset to date, sold out in minutes
0:05:03 upon initial release.
0:05:07 So VR headsets seem to have finally reached a price point and a hardware quality that
0:05:08 has mass market appeal.
0:05:13 And at the same time, you have exclusive AAA games coming to VR for the first time, titles
0:05:21 like Half-Life Alyx, and Half-Life is arguably Valve’s biggest and most exciting IP, a sci-fi
0:05:24 franchise that put them on a map, initially.
0:05:29 It’s famous for ending the franchise essentially on a cliffhanger, and the resolution for the
0:05:35 story is this Half-Life Alyx game, and it’s a VR exclusive, so you can only find out what
0:05:39 happens if you buy a VR headset and you play in VR.
0:05:44 Educational games are actually seeing tremendous growth as well these days.
0:05:47 Teachers in schools are also holding online classes through Discord.
0:05:49 I think that’s an interesting use case.
0:05:55 So rather than platforms like Zoom, some are turning to apps that were traditionally gaming
0:05:57 platforms like Discord or Twitch.
0:06:02 Yeah, I think they’re picking the platform that their audience is already on.
0:06:07 So if you’re an instructor and you’re trying to get kids to come online in order to listen
0:06:13 to AP buyer or whatever subject matter you’re teaching, it’s going to be easier to convince
0:06:17 them to come online if you pick Discord, because chances are they already use Discord to play
0:06:18 their favorite games.
0:06:23 So Discord actually just made a number of moves specifically to help educators come on
0:06:24 the platform.
0:06:29 It’s the user limit on screen change from 10 to 50 users, so you can accommodate larger
0:06:30 class sizes.
0:06:35 And in this case, the actual friction is on teaching the instructors, the teachers themselves
0:06:36 how to use Discord.
0:06:42 One thing in these gaming platforms is that as we’ve seen with video conferencing, the
0:06:45 natural rhythm of the conversation is off.
0:06:49 It’s difficult to respond without interrupting, sometimes it’s difficult to interject.
0:06:57 So when it comes to learning how to have a live interactive conversation online, ironically
0:07:03 I think gamers have received way more training in that area than almost any other demographic.
0:07:09 Because the very nature of playing a game and chatting with someone over Discord or
0:07:14 interacting with a livestream, it’s basically a constant act of juggling foreground versus
0:07:15 background activity.
0:07:19 And so being able to contact switch from okay, I’m listening to the lecture, to now I have
0:07:22 a question and we’re going to talk about this question.
0:07:26 This is something that gamers and then livestreamers in particular have a lot of experience with.
0:07:31 And I think it’s interesting to think about how this might become an increasingly more
0:07:38 critical skill in society as more teams and general folks start working and learning remotely
0:07:40 versus in person traditionally.
0:07:46 So you’re saying gamers may actually be prepared for this future whereas perhaps most of us
0:07:49 who are not gamers may have a steeper learning curve?
0:07:50 That’s right.
0:07:53 John, I want to talk about who is playing.
0:07:57 I think a lot of people have the conception that because schools are canceled in many
0:08:03 places, a lot of it is teens and kids playing more video games.
0:08:09 The average age of a gamer on League of Legends, for example, actually skews fairly old.
0:08:14 I think it’s something in the 20s or the 30s, over time it’s crept up.
0:08:19 And so you have a mix of adults, you have a lot of kids that are definitely playing since
0:08:20 they’re out of school.
0:08:24 And I think one of the neat things is that you have families that are coming together
0:08:28 and playing games potentially for the first time as a sort of quarantine.
0:08:35 Dungeons and Dragons, which is a tabletop fantasy RPG, has actually seen massive growth
0:08:37 as well over the course of quarantine.
0:08:42 In these turbulent times you end up having a lot of folks that are playing D&D together
0:08:44 over Zoom and House Party.
0:08:49 Those broadcast in the live streaming site Twitch is up 34% just in the last week, if
0:08:50 you’re not familiar.
0:08:55 It’s a tabletop game where a group of people role play a story and that story is often
0:08:58 created just by another player of the game.
0:08:59 It’s a giant improv party, essentially.
0:09:04 Yeah, I think it’s important to remember that there’s this whole new audience that is rediscovering
0:09:06 gaming as adults.
0:09:07 Absolutely.
0:09:11 A lot of people are coming back to games as a result of being housebound and they’re
0:09:16 discovering that even though they may not have a console or a gaming PC, they actually
0:09:18 already have an awesome gaming device on them.
0:09:23 PUBG Mobile, which is the mobile version of a player unknown battlegrounds reported increased
0:09:28 revenue of over 50% just in the last week compared to the prior week.
0:09:33 One of the largest mobile games in the world, Tencent’s Honor of Kings grew from an average
0:09:39 baseline of 60 million daily active users to over 100 million plus in February at the
0:09:44 height of quarantine in China, and that’s 60% plus growth, which is pretty amazing given
0:09:46 how large that game was to begin with.
0:09:50 Essentially, you have a lot of new gamers rediscovering that they have a gaming device
0:09:52 and perform at their smartphone.
0:09:55 And some of these newcomers may be traditional sports fans.
0:09:59 As in real life games and sporting events have been canceled, some of these leagues and
0:10:02 teams have been moving online to a digital format.
0:10:07 So about a week ago, the NBA turned one of their canceled games, I think it was Phoenix
0:10:09 versus the Dallas Mavericks.
0:10:14 They took that game and they actually turned it into an NBA 2K game, which is the video
0:10:20 game equivalent of the real NBA, and it was livestreamed on Twitch for everyone to watch.
0:10:26 It’s very trippy for me when I see an NBA star play their virtual persona in a video
0:10:27 game.
0:10:32 Well, and as NBA players have been put in isolation, I think many of them have been
0:10:33 turning to gaming.
0:10:37 There was a Call of Duty tournament for Miami Heat players that was also broadcast on Twitch.
0:10:44 And NASCAR just replaced the canceled races with the first ever eNASCAR series where you
0:10:47 were essentially piloting virtual race cars.
0:10:51 And they brought back a lot of recent legends like Dale Earnhardt Jr. to drive those race
0:10:52 cars.
0:10:57 So professional race car drivers are competing against each other in racing simulation software.
0:10:58 That’s right.
0:11:03 So could eSports be a gateway to turn non-gamers into gamers?
0:11:09 It’s a bit of a hybrid between traditional video games and that live, crowd-driven competitive
0:11:10 event.
0:11:11 It remains to be seen.
0:11:17 I think, yes, from the perspective that you’re having an audience that may have never actually
0:11:24 watched NBA 2K or FIFA, for example, any of these sports video games that are now exposed
0:11:27 to that and might actually think it’s pretty cool.
0:11:32 And it’ll be interesting how many of these NBA players, one, how many of them can build
0:11:38 large eSports followings and then, two, if their eSports followings actually end up being
0:11:42 larger than their real-life following, I think that would be a real success story.
0:11:44 It’s a brave new world.
0:11:46 Let’s turn to live streaming.
0:11:47 Absolutely.
0:11:52 So the analytics site, Sully Nome, actually just released a couple of data insights.
0:11:56 The high-level headline is that Twitch is essentially having the biggest month of its
0:11:57 history.
0:12:02 Livecast hours also grew by 35% over the last week compared to the average of the prior
0:12:03 three weeks.
0:12:10 And Sunday ended up being an all-time record breaker, where 47.7 million hours watched.
0:12:13 Why this rise in live streaming?
0:12:17 Part of that could be due to the fact that you have people that are checking out live
0:12:19 streaming for the first time.
0:12:26 Another interesting nugget was that downloads of the Twitch app increased by about 30% just
0:12:32 in the US alone between the weeks of March 8th and March 15th, so you have a lot of
0:12:34 people that are checking it out for the first time.
0:12:40 I think a second thing is that live streaming is unique as a media format and that it combines
0:12:45 the reach of a public broadcast with the intimacy of a small group community.
0:12:51 And what I mean by that is essentially, as a live streamer, you can reach hundreds of
0:12:53 millions of people with a single live stream.
0:12:59 So it is a public broadcast media just like TV or the radio.
0:13:03 But because of the fact that it’s interactive, your viewers can type at you and you can have
0:13:07 a conversation with them and you can adapt what you’re doing in real time to what your
0:13:09 viewers demand.
0:13:11 It feels like a smaller group conversation.
0:13:14 And you can monetize in real time, right?
0:13:15 That’s right.
0:13:18 People tip in real time if you’re doing something that’s very popular, that if you’ve answered
0:13:24 a request, people can subscribe to your channel and the subscriptions cost money anywhere from
0:13:26 a couple of dollars that way more.
0:13:31 So it’s interesting as both an engagement and a monetization model for influencers these
0:13:32 days.
0:13:39 So it’s kind of a hybrid of YouTube and TikTok in that you can amass this online following,
0:13:42 you can be streaming live, but you can also be monetizing instantly.
0:13:43 That’s right.
0:13:48 On YouTube and TikTok, for example, you produce content and then you upload it in any
0:13:51 way that you have to wait and see what happens and you’re not actually getting that much
0:13:53 in terms of real time feedback.
0:13:59 TikTok is slightly more real time than YouTube, simply because the videos are shorter and
0:14:03 people can like and comment very quickly after you upload something.
0:14:07 But live streaming platforms are unique in the sense that you are literally performing
0:14:12 in real time for a live audience and you’re getting the feedback just as if you’re a stage
0:14:17 performer in real life in real time, given either clapping or throwing tomatoes at you,
0:14:19 or digital tomatoes.
0:14:20 That’s right.
0:14:24 And I think that’s one of the things that makes live streaming work so well right now
0:14:26 in COVID times.
0:14:31 It’s because people are actually able to get a sense of community online through live
0:14:35 streaming that may otherwise be hard to find in the real world because we can’t get together
0:14:37 in large groups anymore, right?
0:14:41 Like you can’t go to church, you can’t go to school, you’re not at work.
0:14:45 So a lot of the communities that people are ordinarily members of I think have sort of
0:14:50 fallen by the wayside and Twitch has been able to provide that sense of community for
0:14:51 a lot of its viewers.
0:14:58 As opposed to passively binging Netflix, people want this more interactive way of being social
0:15:00 with their friends and family.
0:15:04 I mean, speaking of relationships, it’s a bit of a personal story, but video games actually
0:15:08 saved my marriage and totally not getting here.
0:15:10 How so?
0:15:15 So when my wife Jen and I first started dating, we were actually long distance for the first
0:15:16 year of our relationship.
0:15:21 I was in San Francisco, she was in New York, so we actually met at a New York City to get
0:15:27 together and then I had to fly out literally two days from afterwards and it was really
0:15:28 tough.
0:15:31 We didn’t know each other that well, but we started playing an online game called League
0:15:35 of Legends together and that completely saved the relationship.
0:15:39 When we didn’t feel like talking about serious things, we could just play the game and there
0:15:45 were enough sort of highs and lows and moments of tension and drama that we also got to know
0:15:47 each other better as we played together.
0:15:48 I love that story.
0:15:51 Yeah, so who says you can’t find love in video games, right?
0:15:53 So you’ve been married 10 years now.
0:15:56 Are you still playing League of Legends together?
0:15:57 We still are.
0:16:02 It’s one of the mainstays of our relationship actually, so a light-hearted way to spend time
0:16:06 and I imagine that’s what a lot of people these days are doing in quarantine as well.
0:16:11 You know, if you’re in a small apartment or a house with members of a larger extended
0:16:16 family, there’s only some sort of conversation you can have before fights start breaking
0:16:22 out, so maybe you break out the Xbox, play some mobile games, play some party games and
0:16:26 it helps generally improve the quality of life in the house.
0:16:29 I think there’s definitely a social dynamic at play.
0:16:35 A lot of people aren’t necessarily comfortable FaceTiming or video chatting and seeing their
0:16:38 own face reflected as they talk to family members.
0:16:41 So I think gaming provides this distraction.
0:16:45 You’re doing something else while you’re connecting with your family or friends.
0:16:50 Yeah, I think one of the best ways I’ve heard it described by a live streamer is actually
0:16:57 that games can switch back and forth between foreground and background activity, so you’re
0:17:01 not really thinking too hard about the game, but you’re actively conversing and you might
0:17:06 actually be talking about something that’s like very serious, but then you can just switch
0:17:09 the game back into the foreground and you both concentrate on the activity.
0:17:15 And so it provides activity to fill in the gaps that are very natural in conversations
0:17:19 and it doesn’t feel like just long periods of silence if you don’t have anything to say
0:17:20 to each other.
0:17:23 Yeah, I think that’s something we’re all familiar with.
0:17:28 The point is social distancing, quarantine, it’s lonely and I think a lot of people are
0:17:31 rediscovering gaming as a way to connect with others.
0:17:36 So after we weather this crisis, what will this mean for the games industry?
0:17:37 What is the bigger picture?
0:17:43 The bigger picture here is that gaming is unique as a media type and that it’s real
0:17:45 time and it’s fundamentally social.
0:17:50 When you’re playing a game, you’re partaking in an immersive activity with someone else.
0:17:54 And so I think that’s one of the reasons why gaming has seen such explosive growth since
0:17:56 the start of coronavirus.
0:18:01 And so I think games and live streaming are offering a lot of the social connections that
0:18:05 people are missing as they’re staying at home these days and I think that will only
0:18:06 continue over time.
0:18:12 So once this crisis is over, do you expect these new gamers to stick around?
0:18:13 I hope so.
0:18:17 It’s easier than ever to get into games today with just so many different platforms that
0:18:18 you can play on.
0:18:22 If you have a console or a gaming PC, that’s great but you don’t need one.
0:18:27 You can also play phenomenal, triple-way quality games in your mobile phones these days.
0:18:32 And so the barrier is the entry for people coming back in the game to discovering games
0:18:34 for the first time is lower than ever.
0:18:35 Great.
0:18:37 Well, John, thank you so much for joining us on the A16Z podcast.
0:18:38 It’s been a pleasure.
0:18:39 Thanks for taking the time.

0:00:02 (upbeat music)
0:00:14 – Welcome to this episode of “Hustling Tech.”
0:00:16 I’m Ben Horowitz, and with me today,
0:00:19 I have Josh Browder, who is the founder,
0:00:22 CEO of DoNotPay.com.
0:00:25 We have Makiri Omar,
0:00:29 who’s been hustling that platform to great effect.
0:00:30 And then with me, as always,
0:00:34 I have my co-host, Shaka Senghor,
0:00:36 who hustled his way out of the joint
0:00:40 and is now a leader in the community and my co-host.
0:00:41 So welcome.
0:00:42 – Yeah, welcome.
0:00:45 So I love, first of all, I just love the name DoNotPay.
0:00:48 I wanna stamp that on every bill that comes through
0:00:49 and just send it out to everybody.
0:00:52 – So tell us, what is DoNotPay?
0:00:53 How did it start?
0:00:55 – So DoNotPay today is a platform
0:00:58 that helps ordinary people fight for their consumer rights.
0:01:01 So getting back money from corporations and governments.
0:01:04 And it started out four years ago
0:01:05 when I got a bunch of parking tickets.
0:01:07 I was admittedly a terrible driver
0:01:09 and I was writing all of these appeal letters
0:01:11 to get out of my tickets.
0:01:13 And I learned that you can go to a lawyer
0:01:14 and the lawyer will say,
0:01:16 I’ll get you out of your parking ticket,
0:01:18 but I’ll take 50% of the cost of the ticket,
0:01:20 or you have to pay the ticket.
0:01:22 And there must be a better way than that.
0:01:25 And so I’ve researched all of these obscure government
0:01:27 documents to find out the top reasons
0:01:28 why people get out of their parking tickets.
0:01:30 The biggest one is signage.
0:01:32 They make the signage deliberately confusing.
0:01:34 For example, having a tree cover the sign,
0:01:37 having two signs say the opposite thing.
0:01:39 And then the second biggest reason is parking bays
0:01:41 that are physically impossible to park in.
0:01:45 And below 180 centimeters, you can’t get any car in.
0:01:47 And this is mainly because the lines aren’t painted.
0:01:49 Beyond that, they make mistakes on the ticket.
0:01:51 Then you can’t trust them with anything.
0:01:53 And I decided to automate that for my friends.
0:01:54 And then it turned out it was very popular.
0:01:57 So expanded it to the general public.
0:01:59 – And that’s actually kind of cool also,
0:02:00 ’cause coming from where you’re from,
0:02:03 Shaka, you know, a lot of guys with cases
0:02:05 get taken down by parking tickets.
0:02:06 – Yeah, absolutely.
0:02:09 Clear that right on up and not have to run into the courts
0:02:11 when they already got a warrant for other things.
0:02:14 – And McCary, so how did you come across the platform
0:02:15 and what were you doing with it?
0:02:18 – So I have a delivery service, 24/7 delivery service.
0:02:20 When you’re a delivery service and you live in LA,
0:02:22 we have a thing that we like to call parking ninches.
0:02:24 Those are the right.
0:02:25 So when you’re delivering things,
0:02:29 we deliver things at all times of day and hour and night.
0:02:32 So it’s one of those things where I literally needed
0:02:34 to find a way where I can either help some of my drivers,
0:02:37 get out of their tickets, because places like LA,
0:02:40 they literally like to stick you a ticket on your window
0:02:43 that says $70, $77, all the way up to $177.
0:02:45 And the violation can be like,
0:02:47 oh, you didn’t put your will to the left.
0:02:48 Just something really ridiculous.
0:02:50 So I was just trying to find the answer to that.
0:02:52 And then I just remember it was just
0:02:55 so half of the TV was on and next thing you know,
0:02:57 they said, oh, there’s an app, there’s a robot
0:02:59 that can literally take care of your parking tickets
0:03:01 and that could really go to bat for you
0:03:02 and get your money back.
0:03:05 I’m like, huh, yeah, let me try to put it to the test.
0:03:08 And it literally helped me with one or two of my parking
0:03:11 tickets that was a real big problem.
0:03:13 So basically you start using their service
0:03:16 and then later on, they start adding more features.
0:03:18 – When were the other features that you started using?
0:03:20 – So it’s one of those things where you’d have people
0:03:23 who would actually try to buy a product from you
0:03:25 and then they’ll try to say, oh, we never received
0:03:27 that product or they’ll do a charge back
0:03:29 or they’ll try to say whatever the case would be.
0:03:31 And then what would happen is, is that it would go
0:03:33 into my account, it would take money out of my account,
0:03:36 my merchant processor would take money out of my account.
0:03:38 And then it would charge, it would actually come back
0:03:41 to be where like I would have now a negative fund
0:03:44 in my account or they would charge me another like NSF fee.
0:03:46 It’s money that basically is in your account
0:03:47 or they take from you.
0:03:49 It’s just a fee that they charge you for an overdraft.
0:03:52 – So they robbed you facilitated
0:03:53 by the credit card company.
0:03:54 – The product’s gone, the money’s gone
0:03:56 and now you’re taking more money because of everything else.
0:03:59 So they now have something that basically like,
0:04:00 get your bank fees back.
0:04:03 Just like last week, I got like $62 back in fees.
0:04:04 So you can’t knock it.
0:04:07 – You know, the banking system is so,
0:04:10 I mean, for a small business or kind of a person
0:04:13 who doesn’t have a lot of money is the most broken thing.
0:04:16 It’s something we track a lot here and that if you’re me,
0:04:19 you pay nothing for banking services.
0:04:21 If you’re kind of a regular person
0:04:23 trying to go paycheck to paycheck,
0:04:28 it’s like $15 a month in ATM fees and this fee
0:04:29 and that fee and the other things.
0:04:32 It’s all hidden and under the covers.
0:04:33 – Yeah, I was actually thinking about,
0:04:36 if you have a small business like that can be just devastating
0:04:39 be those, ’cause those fees rack up relatively quickly.
0:04:41 So did you have just small businesses mine
0:04:45 or was it just in general, like this is something
0:04:47 that we just need to attack either way it goes.
0:04:48 – So when I launched Do Not Pay,
0:04:50 it was just from my small dorm room
0:04:52 and I put up this website for parking tickets.
0:04:54 I had a contact form on the website
0:04:56 and people didn’t know that there was a 17 year old
0:04:58 behind this website and they thought I was some big law firm.
0:05:01 So they actually say, I don’t have a parking ticket
0:05:06 but I’m getting like this small business like charge back,
0:05:07 things like that.
0:05:09 And so that’s where I got all the ideas to expand
0:05:11 and it’s a bigger problem than just parking tickets.
0:05:14 People are being exploited across the system.
0:05:15 – I’m like a power user.
0:05:18 I mean, it’s one of those things where they even have
0:05:19 something where if you’re going to court,
0:05:21 if you need to get money,
0:05:24 I have a situation now where I had to deal with a landlord
0:05:26 who basically was withholding money
0:05:28 because he went and told me
0:05:31 that the place I was moving into was the certain size.
0:05:32 And he wouldn’t let me see it because he was like,
0:05:35 well, you’ve seen the pictures, you’ve seen this, whatever.
0:05:36 I’m not gonna lie to you, you know,
0:05:37 I guarantee this, I guarantee that.
0:05:39 And it was supposed to be a certain square footage.
0:05:41 Well, it wasn’t, it was like,
0:05:43 it was supposed to be 12, 172 square feet,
0:05:44 but I walked in and I said,
0:05:46 this is 615 square feet.
0:05:48 And he was like, well, you know, you signed the lease.
0:05:51 He took $5,700 of my money.
0:05:54 And so like, I was just like, okay, where do I go?
0:05:55 What do I do for this point on?
0:05:58 So of course I went the legal shield route
0:05:59 because at first that’s the first thing you think of
0:06:00 is attorney base.
0:06:02 Let me see if I can get somebody to write a letter
0:06:03 like real quick.
0:06:04 That didn’t work.
0:06:06 And then finally I was like, okay, well,
0:06:07 small claims here I come.
0:06:08 So I did that.
0:06:11 But then also when I did the do not pay at the same time,
0:06:14 do not pay actually came up with a script
0:06:14 that literally was like,
0:06:16 they researched the whole situation
0:06:17 because you’re typing your situation.
0:06:21 And literally they now have a thing called that says,
0:06:22 what’s your problem?
0:06:25 And it’s like a customer service space problem area.
0:06:27 And it actually goes and it researches similar cases
0:06:30 or similar ideas or something that somebody else has done
0:06:32 or that have been through the same thing.
0:06:33 And it compiles your situation together
0:06:34 and it gives you the structure
0:06:36 of what you need to say and present in court.
0:06:39 So you know exactly what to say to the judge or not.
0:06:41 That’s one of the things that I’m super curious about.
0:06:43 I’ve done a lot of work in criminal justice space
0:06:46 nationally and when talking to people
0:06:48 about the legal structure in the U.S.
0:06:50 where they think it’s just one thing,
0:06:52 it’s one kind of legal structure.
0:06:54 But in reality, every state has its own thing.
0:06:57 How does do not pay work across all these laws
0:07:01 and different rules in each city and county and state?
0:07:02 Like how does that work?
0:07:04 – So it’s four years in the making
0:07:07 and we only focus mainly on consumer rights.
0:07:09 There’s a lot of national laws around consumer rights
0:07:10 that we rely on.
0:07:13 And then we’ve also adapted it for 50 states.
0:07:16 But you’re completely right and the justice system
0:07:17 in general is like pay to play.
0:07:20 The more money you have, the more successful you are.
0:07:22 And so that’s what we’re trying to stop.
0:07:24 – Wow, and how does the system work?
0:07:27 Because my landlord stole my money.
0:07:28 I need to get it back.
0:07:29 I’m taking them to a small claims court.
0:07:30 This is my case.
0:07:34 And then do not pay says, well, this is your argument.
0:07:36 How did you do that?
0:07:39 – So do not pay will talk to you like a real lawyer.
0:07:41 We call it a robot lawyer and ask you questions
0:07:42 about your issue.
0:07:44 And then it goes down through a decision tree
0:07:47 to classify it against like a legally sound way
0:07:49 to sue this person.
0:07:51 And in this case, it’s breach of contract.
0:07:55 So applied his breach of contract law to his case
0:07:58 and then generated a demand letter and small claims script.
0:08:01 And no lawyers are involved in small claims processes.
0:08:05 And so you can have the same power as like a top law firm.
0:08:06 – Right, right.
0:08:07 ‘Cause you’ve done the legal research.
0:08:09 So when you go in court,
0:08:11 you’re just basically going off the script.
0:08:12 Is that what you’re saying?
0:08:13 – That’s right.
0:08:16 And it even tells you responses
0:08:17 to what the other side could say.
0:08:21 So if the other side says, actually I did post it,
0:08:23 you say, well, not in the legally correct place.
0:08:26 So it gives you even back and forth discussion points.
0:08:28 – I mean, I’ve been small claims more than once.
0:08:31 Many people don’t know that when you go to small claims,
0:08:34 you are not allowed to be represented by an attorney.
0:08:36 You literally have to talk your case out
0:08:39 in front of a judge or a sit in judge.
0:08:42 And basically, you know, go back and forth
0:08:44 between the plaintiff and the defendant.
0:08:47 You can consult an attorney before you go
0:08:48 to make sure that what you’re saying is valid
0:08:50 and what you’re going against
0:08:52 is what you are really going to win.
0:08:54 And so like you can do that,
0:08:56 but you just can’t have one present with you.
0:09:00 So what do not pay does is that basically
0:09:01 it takes all that information.
0:09:04 You, I literally wrote out the whole script
0:09:07 and it just gave me the definitions of what point
0:09:09 I needed to basically cover.
0:09:11 And I need to make sure that,
0:09:13 and it even tells you in the whole little paragraph
0:09:15 that they give you,
0:09:18 you have to make sure that each point is clearly defined
0:09:20 and it clearly stated of why this happened
0:09:23 and this happened here or how does this define this?
0:09:24 So it gives you an understanding
0:09:27 of what you have to tell the judge.
0:09:30 I got, you know, I was actually robbed of my money
0:09:32 because this man told me that it was one size
0:09:34 and in actuality it was not.
0:09:35 Here are pictures,
0:09:36 here are everything,
0:09:37 give my evidence to back it up
0:09:39 and here’s what I need to present in order to do so.
0:09:41 So once you get that,
0:09:43 then you kind of feel comfortable going,
0:09:44 like you’re ready to go.
0:09:47 And then also if the person doesn’t show up,
0:09:49 for those who don’t know that, you know,
0:09:50 that you can win by default,
0:09:51 if that person doesn’t show up,
0:09:53 it tells you at the bottom like, okay,
0:09:54 if that person doesn’t show up,
0:09:55 then you tell the judge this
0:09:57 and it tells you a script to read.
0:09:59 So the judge will automatically know, okay,
0:10:01 well this person clearly knows what he’s talking about
0:10:03 because that’s what you have to do in the court of law.
0:10:04 – So how does that work for somebody
0:10:07 who has challenges with literacy?
0:10:10 ‘Cause I mean, like doing this work in criminal justice,
0:10:12 like one of the big issues
0:10:15 is that people take very poor deals largely
0:10:17 because they don’t understand or comprehend a law.
0:10:18 So how does this work?
0:10:20 Is there a way that, you know,
0:10:23 people can just verbally express their argument
0:10:24 or is it all written?
0:10:26 – So it’s all verbal,
0:10:28 but we’re launching voice input.
0:10:30 So you can open-ended say,
0:10:32 my landlord won’t give me my security deposit back
0:10:34 and it will figure it out for you.
0:10:36 We really think about this, making it accessible.
0:10:39 Do not pay a scripture in the simplest English possible.
0:10:42 You don’t have to have an iPhone to use, do not pay.
0:10:45 You can go onto donotpay.com and get access to everything.
0:10:49 And even if you’re blind, we have alt text
0:10:52 and we’re fully compatible with like screen readers
0:10:55 and stuff and soon we’re going to have voice input.
0:10:57 So it’s something we really think about.
0:10:58 Obviously we could be a lot better,
0:11:01 but we’re moving in that direction.
0:11:02 Unfortunately at the moment,
0:11:04 robots can’t represent people in court.
0:11:06 At one day the law will hopefully change.
0:11:09 – So Josh, you say that, you know,
0:11:12 you’re adding features based on your customer input
0:11:13 and all the things that they want to do.
0:11:14 What are some of the things?
0:11:17 – The biggest one is Robocall compensation.
0:11:18 So there are lots of apps that block Robocalls,
0:11:20 but none that get you some cash.
0:11:23 And we’re really excited about this one
0:11:25 because we actually give you a fake credit card
0:11:26 that you can give to the Robocaller
0:11:28 and it will get all of their details
0:11:29 to make it easier to sue them
0:11:32 when they try and run a fake transaction.
0:11:33 But in the longer term,
0:11:36 once you have five million people using Do Not Pay,
0:11:39 it almost gives like group leverage like a consumer union
0:11:41 to go to one of these big corporations
0:11:44 and say we have five million of your customers,
0:11:45 you better start treating them better
0:11:48 or we’ll switch them all to your competitor overnight
0:11:50 and at the same time flood you with legal requests.
0:11:52 So I think right now the leverage is in the law
0:11:56 and the individual, but soon it can be in like collective.
0:11:58 – And is there a fee associated with that?
0:12:01 – So right now Do Not Pay costs $3 a month
0:12:03 and the subscription only starts if you win.
0:12:05 So you can check it out for free.
0:12:07 And the most important aspect of that
0:12:09 is users keep 100% of what they save.
0:12:10 And we’re really looking to make it
0:12:12 as fair pricing as possible.
0:12:15 – And you’re getting something back in return.
0:12:17 Everybody has some type of issue with something or other
0:12:19 that wasn’t even fair
0:12:21 and seems like corporations are taking more advantage of you.
0:12:23 – McCarey, tell us a little bit
0:12:25 about your entrepreneurial journey.
0:12:28 Like how did you, you know, like what’s your background?
0:12:29 – I’ve always been an entrepreneur.
0:12:31 I basically learned to just work for myself
0:12:33 because I’ve already started working for somebody.
0:12:34 Like when I graduated from high school,
0:12:36 I worked for the weather channel.
0:12:38 Then I went and branched off to IBM.
0:12:40 And then after that, I then worked for my mom.
0:12:42 And then after that I did a development company
0:12:45 and then I decided to come out here from Atlanta, Georgia
0:12:48 to great California to actually go to Los Angeles film school
0:12:50 to pursue my dream in film.
0:12:51 – Oh, wow.
0:12:52 – Yeah, but that didn’t work out too well.
0:12:54 So I did a company for business branding.
0:12:56 Then that one kind of just went out on the wayside.
0:12:59 And then finally I was just, it just hit me,
0:12:59 it struck me one time,
0:13:02 but I guess I was in an adult situation.
0:13:05 And the thing was is that basically I literally tried
0:13:07 like all the different type of delivery services.
0:13:10 And none of them would deliver the essential products
0:13:13 that most people need when they are in situations like that.
0:13:14 And then when I tried to postmates,
0:13:16 I then tried to direct them like, okay,
0:13:18 I’ve already called the store.
0:13:19 The product is already on the counter.
0:13:20 You don’t have to worry about it.
0:13:21 It’s already ready to go.
0:13:23 Just pick it up and bring it in.
0:13:26 So I created like a 24/7 delivery service
0:13:29 for Los Angeles and it’s called Luber.
0:13:31 And it was like basically a on-demand delivery service
0:13:34 that do adult retail is what you need.
0:13:35 When you need it, we’ll bring it to you.
0:13:37 I mean, our slogan is basically,
0:13:39 we come even if no one else can.
0:13:42 So it’s just being, like I said, being a small business
0:13:43 is like you’re trying to find every little niche
0:13:46 to try to find something that will help you along the way.
0:13:49 I’ve had platform problems with like my websites,
0:13:51 with just a customer service or with like,
0:13:53 and these are huge companies that literally,
0:13:55 they do not care if they shut your business down
0:13:57 or if they put you on a hold or a freeze
0:13:59 because of something wrong with their system.
0:14:01 And I literally just went through a whole nightmare
0:14:03 during like the Christmas season and the New Year season
0:14:06 where all of a sudden the platform I was with
0:14:07 literally froze my account
0:14:09 because they went with a third party of developers
0:14:10 saying that, you know,
0:14:11 I didn’t want to renew my service with them
0:14:13 because they were actually ripping me off.
0:14:16 And I literally had a problem with trying to, you know,
0:14:18 give me my money back or at least open my site.
0:14:20 I was not late on my bill.
0:14:22 I literally did not want to renew my service.
0:14:24 So what they did was they held me hostage
0:14:26 or help my company hostage by shutting me down
0:14:29 on the most like busiest days of my company,
0:14:31 which is of course the holiday season.
0:14:34 So literally, like I had like inventory ready to go,
0:14:37 everything set to go and they froze it on Christmas day,
0:14:39 then they froze it on New Year’s day and then, and so on.
0:14:41 And I was like, okay, I can’t deal with this.
0:14:43 I even signed up for the big like, you know,
0:14:45 LinkedIn, like the premium service.
0:14:47 So I could literally write the head of the company
0:14:49 ’cause that’s the only way you never get to them.
0:14:50 Never got a response.
0:14:52 And so I finally did it through do not pay.
0:14:53 That’s at least fighting for me.
0:14:55 And I know that if they can’t get it solved,
0:14:57 it’ll at least keep my problem in front of their face
0:14:59 long enough that something’s gonna come of it.
0:15:02 And that’s what it actually did just recently.
0:15:04 I finally got access to like my old website.
0:15:06 So I could get at least my financials
0:15:08 and everything off of it so I can put on my new website.
0:15:10 Do not pay, I guess went and did something
0:15:12 with either the Better Business Bureau
0:15:15 or they did something where they actually got a route to them.
0:15:18 So it’s literally helped my company out tremendously.
0:15:19 – How do you think about that problem
0:15:21 that because you started with parking tickets
0:15:26 that people may not know that you’re their lawyer of choice
0:15:28 for every kind of dispute
0:15:31 that an individual might get into or a small business?
0:15:32 – It’s a tough problem.
0:15:35 People come to do not pay with this very episodic issue.
0:15:37 What we try and do is use the design of the app
0:15:41 to nudge them towards saving money in other areas.
0:15:44 So maybe in this case, someone comes for a parking ticket,
0:15:45 they finish their parking ticket appeal
0:15:48 and then a pop-up comes up as saying,
0:15:50 do you wanna appeal $50 a bank fees?
0:15:52 And then they can just one click press that
0:15:53 and move on to their next issue.
0:15:56 You can cancel any subscription with do not pay,
0:15:59 even one where you have to even mail in like a legal letter
0:16:01 just to cancel your subscription.
0:16:03 The most popular product is something we call
0:16:05 the free trial credit card,
0:16:08 which is a virtual credit card we give you through the app
0:16:09 and you can sign up for any free trial
0:16:11 and it automatically cancels it for you.
0:16:13 So you don’t have to worry about giving away
0:16:15 your financial information just to sign up
0:16:16 for a free trial for something.
0:16:18 What we’ve seen is a lot of power users
0:16:21 likes what’s being discussed as people come for one thing
0:16:23 and then all of a sudden try like 20 different things
0:16:24 and go crazy.
0:16:25 – Yeah, so in your estimation,
0:16:29 like what type of lawyer fees are we seeing save?
0:16:30 You know what I mean?
0:16:33 Like any litigation in America is very expensive.
0:16:35 – So on an aggregate level,
0:16:38 we’ve saved over $20 million in unfair fees
0:16:41 and lawyers typically charge 50% of what they save.
0:16:44 So maybe $10 million of legal fees.
0:16:45 And on an individual level,
0:16:50 we win cases from a $10 in-flight Wi-Fi refund
0:16:53 to $10,000 small claims dispute
0:16:55 against Equifax for the data breach.
0:16:56 Anything more than that,
0:16:58 we’re not sophisticated enough to argue yet,
0:17:01 but below $10,000, we’ve got you.
0:17:05 – So when you get into this customer service dispute
0:17:06 that McCurry had,
0:17:08 ’cause that sounds complicated, okay?
0:17:11 It’s a website, you know, they’re hosting service,
0:17:14 they take, they have his data,
0:17:16 they’re withholding it from him.
0:17:20 How did Do Not Pay figure out how to deal with that?
0:17:22 – So maybe the consumer wants a refund,
0:17:24 maybe they want access to their information.
0:17:26 In this case, it sounds like it’s both.
0:17:30 So it first finds out the goals
0:17:33 and then uses, like tries to match you
0:17:35 with legal justifications for those goals
0:17:37 and then sends it to the exact right place
0:17:39 for the people who can get it done.
0:17:42 In this case, the customer service is so bad
0:17:44 that the only way to actually get their attention
0:17:45 is to send them a legal notice
0:17:47 to their legal processing department.
0:17:49 And those people are actually efficient
0:17:53 at processing their claims and getting the right resolution.
0:17:56 – One of the things we talk a lot about in crypto world
0:17:58 is, you know, code as law.
0:18:01 And it seems like you’re ahead of the game on that.
0:18:05 You’ve got software that’s interprets the law.
0:18:06 So how does that all work?
0:18:07 – I completely agree.
0:18:09 I think law is society’s operating system.
0:18:12 And like it is just code.
0:18:14 Why is it so complicated to understand it?
0:18:16 Technology is based on rules
0:18:20 and it’s very good at understanding the different nuances.
0:18:23 The best processes are ones that can be submitted online.
0:18:26 And I think the most interesting technical angle
0:18:28 is everything comes from the user
0:18:31 and there’s nothing related to do not pay on the appeal.
0:18:34 So when we started appealing parking tickets,
0:18:36 all of a sudden we started sending thousands of appeals
0:18:38 to the local government and they just like shrugged
0:18:41 and said, we’re going to start ignoring these do not pay appeals.
0:18:43 So in response to that,
0:18:45 we decided to randomize all of the letters.
0:18:48 So every letter you get from do not pay is different.
0:18:49 (laughing)
0:18:52 – It’s like a denial of service attack on parking tickets.
0:18:53 – And then beyond that,
0:18:56 we use something called device side automation.
0:18:58 So lots of the automation and submitting the appeals
0:19:00 actually comes from the device,
0:19:02 which means that all of the technical fingerprints
0:19:05 like IP address and stuff like that
0:19:07 makes it seem like an organic user submission.
0:19:09 So when someone submits a claim from do not pay,
0:19:12 it just seems like they’re very knowledgeable about the law.
0:19:15 – All right, this is my want to be.
0:19:18 So how does one utilize it?
0:19:20 – So we have 150 different features
0:19:22 and I would say they fall into two categories.
0:19:24 Either you come to do not pay with a problem
0:19:27 or you’re just browsing and want free money back.
0:19:28 If it’s the latter category,
0:19:30 you can maybe connect to data source,
0:19:32 maybe link your transactions
0:19:33 and it will go through them
0:19:35 and figure out where the money lies.
0:19:37 So I think in the case of the bank of fear appeal,
0:19:40 lots of people don’t even know that they have these bank fees.
0:19:43 They’re just being silently collected from their account
0:19:44 and you can connect your bank account
0:19:47 and it will identify all of these opportunities for you.
0:19:49 – So okay, so you sign up like all,
0:19:50 just all your different bank accounts
0:19:53 and in the banks aren’t disputing
0:19:54 that you signed up for these fees?
0:19:57 Like how is it circumvent that process?
0:20:00 – So either the bank is making a legal promise to you.
0:20:01 So lots of credit cards.
0:20:03 If you see an ad for a credit card,
0:20:05 it’ll say no ATM fees.
0:20:07 But all of a sudden you go to an out-of-network ATM
0:20:09 that’s not owned by the bank
0:20:11 and you start getting the fees on your account
0:20:13 and the bank actually has to reimburse you for that
0:20:14 but you have to let them know.
0:20:17 So do not pay, identifies that and lets them know.
0:20:20 Separately maybe with overdraft fees.
0:20:23 Sometimes it’s the law, sometimes it’s customer service
0:20:26 where using all of this data that do not pay can compile.
0:20:27 It will make the best case
0:20:29 for why these fees should be appealed.
0:20:32 So like say, I’ve been a customer for X years,
0:20:34 I’ve held X minimum balance.
0:20:35 You should refund the fees.
0:20:39 – I literally the day before got an email saying,
0:20:44 congratulations, you just got $61.62 worth of like fees
0:20:46 from your bank back into your account.
0:20:47 I’m like, oh my God, this is great.
0:20:49 – So it works in the background.
0:20:50 – Oh wait, wait, wait.
0:20:52 So you start off with a parking ticket
0:20:53 and it’s like, well, by the way,
0:20:54 let me save you some cash.
0:20:58 – Originally what happened was, as he said before,
0:21:00 it starts to bill you when you win your case or whatever.
0:21:02 So if you win a case with them, then it starts,
0:21:03 and I’m like $3 a month,
0:21:06 like you just literally gave me my money back.
0:21:10 – So when you link your bank account to get reimbursed,
0:21:12 then it just starts working like,
0:21:14 oh, by the way, you got some money over here.
0:21:15 – That’s what it did.
0:21:16 It went through my transaction.
0:21:18 – No other law firm is proactive like that.
0:21:19 – It does ask you somewhere,
0:21:22 but once it’s on, it will get you the money back.
0:21:24 And because you’re keeping a hundred percent,
0:21:25 you don’t even have to worry.
0:21:26 – I cannot be the only one in this world
0:21:29 who like literally has like so many issues sometimes
0:21:32 where it’s like, can I not like, you know, lose to win?
0:21:33 Can I not like get something done?
0:21:35 – Well, you know, it’s so interesting
0:21:37 ’cause the financial services are like
0:21:40 low-key criminal organization
0:21:43 in that they sell you something,
0:21:46 they hit you with print, you can’t read things
0:21:49 that nobody would ever look at, all this kind of thing.
0:21:53 And then they work around all these laws.
0:21:54 So like, you know, they’re a usury law,
0:21:56 so nobody’s gonna charge you over that percentage,
0:22:00 but the overdraft fee, you know,
0:22:03 is way bigger than the interest would ever be
0:22:05 on a user’s requirements.
0:22:07 So they’re doing all this stuff
0:22:08 and there’s no way to fight it,
0:22:10 which is why nobody ever does.
0:22:13 – I had a small loan, I actually took the money out,
0:22:14 I paid it back.
0:22:16 There was one point where we kind of fell behind
0:22:17 a month or so.
0:22:20 And like literally the next thing you know,
0:22:21 all of a sudden they just start taking,
0:22:23 they decided what amounts they want to start
0:22:25 taking out of your account without letting you know.
0:22:27 So I literally, I’ve had to use do not pay
0:22:29 to actually try to get those fees back or whatever.
0:22:30 And I worked for that.
0:22:31 – So it worked and getting your fees back?
0:22:34 – Yeah, it definitely did because I was able to
0:22:37 at least express myself or show to the app itself,
0:22:39 like this money was taken for this
0:22:42 and here where they already took money out.
0:22:43 Like you can’t charge me an SFV
0:22:45 and then already take the money out.
0:22:46 It doesn’t work that way.
0:22:48 And so like, I’ve been able to show my bank like,
0:22:49 okay, you’re double dipping.
0:22:51 People, somebody’s double dipping here.
0:22:54 So it actually went through and actually found like two or three.
0:22:55 – Wow.
0:22:56 – So Jess, how do you go from like,
0:22:57 what was that moment where you was like,
0:23:00 okay, this is more than just helping my friends
0:23:02 beat dumb tickets to like,
0:23:04 oh, this is actually a business model
0:23:08 that can help people, but also that I can monetize.
0:23:10 – I think the reason it can be a business
0:23:13 is because you’re creating a huge amount of value for people.
0:23:14 And it’s a universal need.
0:23:16 We have homeless people use our product.
0:23:18 We have top VCs who use the product
0:23:20 to cancel their expensive equinox gym
0:23:22 and everyone in between.
0:23:24 We have a whole range of people
0:23:26 based on socioeconomic factors.
0:23:29 So it’s really everyone from a socioeconomic standpoint
0:23:32 and it skews older, about 80% on iPhone
0:23:34 and then the rest on web.
0:23:35 We don’t spend any money on marketing.
0:23:38 It’s all word of mouth and people talking about us
0:23:40 in the media and things like that.
0:23:43 Also, we post a lot of content on our website
0:23:46 and that ranks very highly organically on search engines.
0:23:49 So for example, if you search Sue United Airlines
0:23:50 with the number one result,
0:23:52 it’s more like they cancel a flight
0:23:55 or you cancel a flight and the refund just never went through.
0:23:57 So you never get your money back.
0:23:59 And so it’s a lot of this stuff.
0:24:01 – It’s not like they won’t give you your money
0:24:04 but they’ll make you jump through 30 flaming hoops.
0:24:05 – It’s really common.
0:24:06 I think it’s a business practice.
0:24:09 There’s this very famous Comcast calls
0:24:11 where someone phoned up Comcast
0:24:12 and they recorded it on YouTube
0:24:14 and they said, “I want to cancel my Comcast.”
0:24:17 And the Comcast representative held them up for an hour
0:24:20 rather than just canceling their service.
0:24:22 Do Not Pay actually has a product called Skip Weighting On Hold
0:24:24 that allows you to, a bot weights on hold
0:24:26 that transfers it to you.
0:24:28 – So I literally just got through moving.
0:24:29 You have to change your license,
0:24:31 you have to change everything else about everything.
0:24:33 And they actually have a thing where it says,
0:24:35 I think it’s like fill out government papers.
0:24:37 So like you click on that and then it says,
0:24:41 it gives you like CSA, DMV and like two other like items
0:24:41 or whatever.
0:24:42 Well, of course I need the DMV.
0:24:44 I also need to, you know, get my plates
0:24:45 and everything changed over.
0:24:47 Cause Los Angeles is very isonomous
0:24:49 for basically like pulling you over and saying,
0:24:51 “Oh, I’m sorry that this doesn’t fit the car.
0:24:52 This doesn’t feel whatever.”
0:24:54 Or they’ll try to find something on you.
0:24:56 And so basically I just like to try to stay on the up and up
0:24:57 when it comes to that,
0:24:58 especially being a delivery service.
0:25:00 So I was able to actually do that.
0:25:03 They actually made the appointment for me to actually go in
0:25:05 and actually do the thing for my plates
0:25:07 to change address or whatever.
0:25:08 – But what’s the difference between you just calling
0:25:10 and making an appointment yourself?
0:25:12 – I don’t know if you’ve ever called the DMV before
0:25:14 to even get to a person on the phone.
0:25:16 You have to wait the longest time ever.
0:25:18 So like literally it actually will sit up there
0:25:20 and do everything for you.
0:25:22 It’ll wait on hold the whole time for you.
0:25:25 And then it’ll ring you and let you know, like, hey,
0:25:26 you know, you pick up the phone and they’re like,
0:25:28 “Hi, you’ve been on hold for such and such.
0:25:29 How can I help you?” or whatever.
0:25:31 And it’s like, it took your place.
0:25:33 So it doesn’t work for you.
0:25:36 – Yeah, I mean, you’re clearly ahead of the bureaucracy.
0:25:40 Do you think they’ll try to catch up to you in any way
0:25:43 or they just like hopelessly slow
0:25:44 or how do you think about that?
0:25:46 – I think that in the long run,
0:25:48 we’re actually doing them a favor.
0:25:50 And that might sound a bit crazy to say,
0:25:53 but when Do Not Pay launched in Los Angeles
0:25:54 for parking tickets,
0:25:56 someone asked the head of the Los Angeles
0:25:58 parking enforcement, “What do you think about
0:26:00 all of these appeals that all of a sudden
0:26:02 come from Do Not Pay?”
0:26:04 And he said that, “Well, it’s actually quite good
0:26:06 because at least when they come from Do Not Pay,
0:26:07 it’s standardized.
0:26:09 People write such gibberish in their parking appeals.
0:26:11 It saves us processing time.”
0:26:13 And I think that Do Not Pay can actually help
0:26:17 in the long run by siphoning through the legitimate cases
0:26:19 and getting those people refunds quickly
0:26:21 and then also siphoning through the gibberish
0:26:23 and making sure everything is fair.
0:26:26 So hopefully a better, more efficient society
0:26:27 is good for everyone.
0:26:28 – So speaking of that,
0:26:30 I remember when I was in prison,
0:26:33 like guys would literally file lawsuits
0:26:35 for any and everything.
0:26:37 How have you seen any just kind of like
0:26:40 extremely ridiculous cases of people just being like,
0:26:43 oh, I want to litigate this or litigate that?
0:26:46 Or is there some type of way that it can kind of rule out
0:26:48 just frivolous like lawsuits?
0:26:51 – So we haven’t seen really any of that.
0:26:53 And I think the reason is that the crazies
0:26:55 already know how to abuse the system.
0:26:57 And really, this is a tool for people just entering in
0:26:59 to get their access to their rights.
0:27:01 The only frivolous lawsuit that I can think of
0:27:03 is when people try and test out
0:27:07 the sue product against us to get their $3 back.
0:27:09 And we just refund it in those cases.
0:27:12 – Probably lawyers from the big financial services firms.
0:27:15 – Yeah, and so Josh, one of the things that really stood out
0:27:19 is when you talked about how do not pay
0:27:21 is helping people establish their rights
0:27:22 and really get an understanding.
0:27:24 How does that work in a broader context
0:27:29 for people who may not on a normal circumstance
0:27:31 and know that they have a right to certain things
0:27:33 as opposed to just being disruptive?
0:27:36 – So I think that the system is stacked against everyone.
0:27:40 Like bank fees alone is $20 billion a year plus.
0:27:43 And that’s more than all election spending combined.
0:27:46 And so there are so many ways to get out of these fees.
0:27:49 So many laws that exist that have been created
0:27:52 to protect consumers, but nobody knows about them.
0:27:54 So there’s the small claims court process
0:27:57 where you can take companies to court for under $10,000
0:27:59 and lawyers are black band.
0:28:00 There’s the charge back process
0:28:02 where you can refund from your credit card.
0:28:05 All when companies are taking money out of your bank account
0:28:08 like we saw with the case we discussed earlier,
0:28:11 within 60 days, you can get that money back.
0:28:14 No questions asked based on the laws around ACH.
0:28:16 And so all of these laws exist
0:28:17 and the infrastructure exists,
0:28:18 but people don’t know about them.
0:28:20 And so do not pay can help fight
0:28:22 and get consumers their rights.
0:28:25 – So Josh McCurry, thank you for being here.
0:28:27 Thank you all for joining us today.
0:28:30 We’re really excited to see what the platform goes.
0:28:31 – Thank you.
0:28:33 (upbeat music)
0:28:36 (upbeat music)
0:28:39 (upbeat music)
0:28:41 you
0:28:51 [BLANK_AUDIO]

0:00:02 (upbeat music)
0:00:15 – Welcome to this episode of Hustling Tech.
0:00:19 Today we’re gonna talk about how to take way better care
0:00:23 of the elderly and make a living in doing so.
0:00:27 With me, I have Sesternberg co-founder and CEO of Honor.
0:00:30 I’ve got our hustler, Samantha,
0:00:33 who’s gonna tell us how she makes use of Honor.
0:00:36 And then I have with me as always my co-host
0:00:39 who hustled out of the joint to become a leader,
0:00:43 advocate, management consultant, Shaka Senghor.
0:00:44 – I’m really excited to talk to you.
0:00:47 What was the inspiration behind Honor?
0:00:49 – Yeah, so the inspiration was my mother.
0:00:50 When she picked me up at the airport
0:00:53 and was driving me home, she was just driving slowly.
0:00:55 And I was like, what does this mean for five years from now
0:00:58 or 10 years from now, ’cause she lives in Connecticut.
0:00:59 And I don’t wanna be the son
0:01:01 who ever has to say to his mother,
0:01:03 “Hey, I’m sorry, mom, you have to leave your home.”
0:01:07 And so myself and my co-founders looked for any solution
0:01:10 around helping the elderly remain in their homes as they age.
0:01:12 And we found home care.
0:01:15 It’s just really hard to figure out who to trust,
0:01:18 who to turn to, where to go.
0:01:20 And it’s not just hard for you,
0:01:21 someone who needs to figure out care
0:01:23 for your grandmother or your parents.
0:01:26 It’s hard for the folks who work in home care.
0:01:28 Really early on, we identified
0:01:31 that we’re not a normal tech company,
0:01:33 no customer cares about our technology.
0:01:36 They only care about the person who’s gonna go into the home
0:01:38 and serve their mom or their dad.
0:01:42 And so first of all, we call those folks care pros,
0:01:45 care professionals, and that’s a unique name to Honor.
0:01:48 And we did that because when we talked to care pros,
0:01:51 they told us that they generally feel disrespected.
0:01:52 And so starting Honor was really
0:01:53 about helping the elderly,
0:01:56 but then also doing what we call care for the care pros.
0:01:59 – You know, trust is an interesting word
0:02:02 ’cause it’s kind of beyond okay, are they competent?
0:02:06 It’s who do I trust to be in my home with me
0:02:09 who I can get along with and all that kind of thing.
0:02:14 And elderly people are not very flexible generally
0:02:16 in like who they can get along with.
0:02:20 – So it’s not just your classic like super hands-off,
0:02:22 everybody’s a contractor thing,
0:02:24 because training is critical.
0:02:28 All of our care pros are actually W2 employees of Honor.
0:02:30 In this space where someone literally will walk
0:02:33 into the home of your mom
0:02:37 and potentially give her a bath to your point bed on trust,
0:02:39 knowing that that person’s like really good
0:02:41 and vetted is a super big deal.
0:02:45 One of the issues about taking care of the elderly
0:02:48 is that their needs are very specific.
0:02:51 One specific kind of need is who they like.
0:02:54 Another specific kind of need might be the care pro,
0:02:58 who is dementia trained, who is not allergic to cats,
0:03:01 who she gets along with, who lives near where she lives,
0:03:03 who is available on her schedule.
0:03:06 And so to be able to get the right matches
0:03:09 is a really big deal also for the care pros
0:03:10 because one of the things that we found
0:03:15 is one of the dominant things that makes a care pro happy
0:03:17 and helps the care pro reform better
0:03:19 is if you put them in situations
0:03:22 that are more appropriate to their skills
0:03:23 and their personalities.
0:03:26 And then the technology that we build
0:03:29 is really just about how do we do that at scale
0:03:32 so that you can choose from thousands of care pros
0:03:34 against thousands of customers
0:03:36 and kind of know how to make those matches appropriately.
0:03:40 – So Samantha, tell us a little bit more about your journey.
0:03:42 – So I was working as a nurse in London
0:03:46 before I moved here around four and a half years ago.
0:03:48 I studied my nursing in the Philippines
0:03:52 and then in London, it’s different from the United States.
0:03:54 When I became a nurse, when I applied from the Philippines,
0:03:57 it was easier because they hired you
0:03:59 because you’ve already just give you a six months probation.
0:04:03 So they see how you work, how you interact with the clients,
0:04:06 what you know, the knowledge you know, how you do your work.
0:04:09 So that’s how they basically hire you.
0:04:10 And like here, it’s different
0:04:13 because there’s another exam that you need to pass,
0:04:16 the NCLEX, which is the licensure examination
0:04:17 that you have to take here.
0:04:19 And that’s everything.
0:04:21 And in the nursing field here in America,
0:04:22 it’s pretty challenging
0:04:24 because if you’re a foreign nurse,
0:04:27 they basically tell you you’re not qualified
0:04:29 to be a nurse in the United States.
0:04:32 You have to take some courses to enhance your studies.
0:04:34 Sometimes they tell you to do the whole thing.
0:04:36 Sometimes it depends on who assesses your grades
0:04:38 and your transcript of records.
0:04:40 So it can be luck sometimes.
0:04:42 – And that’s amazing that, you know,
0:04:45 we have care pro shortages, nursing shortages here.
0:04:50 And then we have a bureaucracy that makes only some sense.
0:04:53 I mean, it’s such an important thing just societally.
0:04:56 This is a lot about a society of how it cares for its elderly.
0:04:59 And we just don’t do a very good job of it yet, I think.
0:05:01 So did you grow up in the Philippines?
0:05:02 – I did grow up in the Philippines
0:05:04 and I finished my college there.
0:05:06 – Amazing, home of Manny Pacquiao.
0:05:09 – Yes, home of the champions.
0:05:11 And yeah, so that’s how it started.
0:05:14 And then I moved to Spain because I was half Spanish.
0:05:16 I was able to move there, live there,
0:05:18 and start my career there.
0:05:19 And I started working as a caregiver
0:05:22 because in Spain, you have to convalidate your studies
0:05:25 and it was not as easy when you’re a foreign nurse,
0:05:28 which is the same thing happening in the United States nowadays.
0:05:31 And so caregiving was always the first thing you do
0:05:33 when you start in the medical field.
0:05:35 And so that’s like the startup thing to do.
0:05:37 So your training starts from there,
0:05:39 obviously from what you’ve learned in college as well.
0:05:42 And then you put your practice all together.
0:05:43 And so it started there.
0:05:45 And so when I moved here a couple of years back,
0:05:47 I worked with different agencies.
0:05:48 – And how is that?
0:05:52 – It can be a challenge because the thing is with caregivers,
0:05:53 you have to be a match with your clients.
0:05:55 And your clients have to like you.
0:05:57 For them to have you keep coming back.
0:06:03 So once you go to their homes and you’re given a shift,
0:06:05 you have to make sure that you are confident.
0:06:07 You have to show them that you know what you’re doing,
0:06:08 especially with dementia patients,
0:06:11 that sometimes they will not know exactly
0:06:13 what they’re doing at certain times.
0:06:15 And they might forget exactly what they did
0:06:17 an hour or 30 minutes ago.
0:06:19 So you have to be that guide to them.
0:06:23 And you have to be that strong backbone that they can trust.
0:06:26 And also, you know, just feel safe.
0:06:28 I think that’s the most important thing.
0:06:30 Obviously there’s a personality match
0:06:33 because in this job it’s very interpersonal.
0:06:35 So you really have to be a match.
0:06:38 Not only with a client, sometimes with a whole family
0:06:40 because you’re not just dealing with a client.
0:06:42 You deal with a whole family.
0:06:44 And some families have different stories
0:06:46 and different things that they go through
0:06:48 and issues that they go through
0:06:50 that, you know, you need to be part of.
0:06:52 And one thing that with families that I always know
0:06:54 is communication is a big deal.
0:06:56 Yes, the app helps a lot.
0:06:58 Not only just to find work
0:07:01 because the app also you write your shift notes.
0:07:03 So basically it’s very beneficial for family members
0:07:06 that don’t live close to their families
0:07:08 or to the clients or to their parents
0:07:09 that we take care of.
0:07:11 Because there they can see what we did
0:07:13 throughout our shift.
0:07:16 So basically, if they ate what they ate,
0:07:18 the amount of food,
0:07:20 if they were able to go to the bathroom,
0:07:21 all of these things.
0:07:24 And so that way they’re able to check on their parents
0:07:25 and communication is open
0:07:28 based on the shift notes that we do.
0:07:29 So what is that experience like
0:07:31 from the family’s perspective?
0:07:34 For customers, we look like a normal home care agency.
0:07:37 So we will go into your mom’s home.
0:07:39 It cannot be done over the phone with you.
0:07:41 And then we figure out what the care plan is.
0:07:45 And then once we know what the care plan for your mom is,
0:07:46 then we can figure out which care pros
0:07:48 or the best care pros.
0:07:49 So it doesn’t matter who you are,
0:07:50 you want the phone.
0:07:55 Because this is who might give your mom a bath
0:07:57 in your mom’s home when you’re not there.
0:07:58 That’s scary.
0:08:03 And so people do not trust not hearing a human voice yet.
0:08:08 What we find is as people start to use honor,
0:08:10 then they switch over to the tech.
0:08:13 So then they change the schedule on the app.
0:08:16 Then they request more help on the app.
0:08:18 Then they change the care plan on the app.
0:08:21 But it’s after they’ve been using it for a period of time
0:08:22 because trust has been built up.
0:08:25 So stuff like the notes.
0:08:27 Samantha talked about that the care pros leave
0:08:29 is literally the customer’s number one favorite feature
0:08:31 because it brings them into the home
0:08:34 and they can see what mom and dad did
0:08:35 with the care pro from honor.
0:08:37 Or what we call the wellness check.
0:08:40 The wellness check is basically how their mood was
0:08:42 on that day, how they slept.
0:08:45 So there’s different tabs that you need to click.
0:08:48 How happy were they for that day from zero to 10?
0:08:51 Their pain level while you were on the shift.
0:08:54 So they are aware of basically what’s really happening.
0:08:56 Transparency, right?
0:08:59 So for the kids, right, which is usually the family.
0:09:01 And when I say kid, I usually mean a 40 to 60 year old.
0:09:03 Right, you mean me.
0:09:04 Yeah, exactly.
0:09:07 So the design point for the app for our care pros
0:09:09 is to empower them.
0:09:10 It’s professionalization.
0:09:12 So know what’s expected of you.
0:09:14 Give you the training.
0:09:14 Give you the tools.
0:09:17 Put you into the right environment
0:09:19 where you can use that training and tools
0:09:20 and be successful and then tell you
0:09:22 how you’re doing rewards consequences.
0:09:24 So that’s professionalizing care pros.
0:09:26 And that’s what our app is basically designed to do for them.
0:09:28 So like client profiles, because that’s a tool.
0:09:31 So for the customers, what we think about
0:09:33 is basically transparency.
0:09:36 So it’s scary because someone’s going to your home.
0:09:40 They’re very intimate with your mom or dad.
0:09:43 They’re going to be intimate with you as well at some level.
0:09:46 And so how can we show you and demystify
0:09:47 what’s actually happening?
0:09:49 So with that established that trust
0:09:52 and going into it from the wellness checkpoint,
0:09:55 is it like it’s an easy way to just notify them via the app?
0:09:57 Yeah, so one thing that happens
0:10:00 is they literally just get after every visit the note.
0:10:02 They could see like, you know, mom’s pain threshold
0:10:05 is usually four, today she said seven.
0:10:08 So like they can see, oh, something changed.
0:10:09 Like I should figure out what’s going on with mom.
0:10:12 And that’s a new level of kind of, you know,
0:10:14 data information that people didn’t have before.
0:10:18 But now, you know, we get literally a Dickens novel
0:10:22 worth of like notes from care pros every single day.
0:10:24 Humans can’t read that much information.
0:10:29 So our computer can literally read all the notes
0:10:33 and determine when it believes a fall may have occurred,
0:10:35 even when honor wasn’t at the home,
0:10:37 and even if the word fall was never used.
0:10:40 Literally, the note might say, you know,
0:10:42 it’s fall outside and we went for a walk,
0:10:43 the computer will ignore it.
0:10:45 But the note might say, I arrived at the home,
0:10:49 Mr. Smith was on the floor, I helped him get up,
0:10:51 he was a little bit sore, and the computer will see it.
0:10:53 And flag, there may have been a fall,
0:10:55 and then our care managers can intervene
0:10:57 and notify the family.
0:11:00 So this is just like crazy stuff that you can start to do
0:11:03 if you build it into your platform.
0:11:05 And are the family members, is it sometimes
0:11:08 that the family member had been the caregiver
0:11:09 and then is transferring it to honor?
0:11:12 So almost always the family members
0:11:14 at some level are the caregivers.
0:11:15 The question is, are they there or not?
0:11:17 And even if they live far away,
0:11:19 oftentimes they’re helping with like paying bills
0:11:21 and, you know, kind of lining up supports,
0:11:23 lining up to doctors, is it on the phone?
0:11:27 Usually 24/7 then we’re often like
0:11:29 the dominant provider of care.
0:11:31 Another thing I was curious about was whether
0:11:33 there’s this interact with insurance companies,
0:11:36 like how do families pay for the services?
0:11:39 So non-medical home care today,
0:11:41 which is like helping with activities daily living,
0:11:42 so these things like getting out of bed,
0:11:44 getting food, getting dressed,
0:11:46 is usually not covered by insurance.
0:11:49 So if you need something like IV changed
0:11:50 or if you need a wound pack,
0:11:53 like if you’re breaching skin, that usually is.
0:11:56 But in our world it’s either people
0:11:57 are usually paying out of pocket
0:12:00 or they’re using long-term care insurance.
0:12:02 So if they did purchase long-term care insurance
0:12:05 and about 30% of our customers have long-term care insurance.
0:12:09 And how does that cost compared to, you know,
0:12:11 putting them in a home or that kind of thing?
0:12:13 So basically the kind of crossover point
0:12:15 is about 50 hours a week.
0:12:19 So if they’re getting honor for like less than 50 hours a week,
0:12:20 it’s probably cheaper to use honor.
0:12:23 And if it’s more than 50 hours a week,
0:12:25 if it’s literally just about money,
0:12:26 you would choose a facility.
0:12:30 The trick with facilities is most people don’t want to be there.
0:12:33 A lot of my clients actually do prefer to stay in their homes.
0:12:37 I believe that a lot of my clients that have worked hard,
0:12:41 they believe that their money should be used towards them.
0:12:43 So they always fight, you know,
0:12:44 for the money to be spent on them.
0:12:47 Because sometimes there’s a connotation,
0:12:49 like family members think,
0:12:53 oh, because my mom is old, oh, let’s put her in a facility
0:12:55 and then let’s have somebody else take care of them.
0:12:56 But that’s not what they want.
0:12:59 And it’s a battle when it comes to that,
0:13:00 because they think, oh,
0:13:03 but I have all this money to pay for my care.
0:13:06 Why can’t I keep my caregivers in my house
0:13:09 where I feel comfortable, where this is my home,
0:13:10 I’ve lived here all my life,
0:13:12 then to go to a new home
0:13:14 and have to deal with other people that live there.
0:13:17 So that’s always a dilemma when it comes to the care industry.
0:13:21 – Do people want to put their parents
0:13:26 in a facility because of cost
0:13:28 and so they can get the rest of the money
0:13:31 they don’t know about in home care or what drives that?
0:13:34 – I think it’s all about the cost.
0:13:35 That’s what I feel.
0:13:36 Because some clients don’t have dementia.
0:13:38 I’ve had clients that I took care of
0:13:42 and they reach 100, 102 years old with no dementia.
0:13:45 Just basically you’re just helping them on the day to day,
0:13:48 like with their food, with their baths,
0:13:50 not everybody has dementia,
0:13:53 so they can still make decisions for themselves.
0:13:55 And sometimes it’s a battle with the family
0:13:56 because they feel like their decisions
0:13:58 for their parents are better than their own.
0:14:00 And so it becomes a battle.
0:14:03 But it’s always about the money, unfortunately.
0:14:05 – A lot of videos come out of elders
0:14:07 being abused in these places.
0:14:09 So with that in mind,
0:14:12 does honor interact with a nest or something like that
0:14:15 where people can actually visibly see
0:14:17 the care that’s going on in the home?
0:14:19 – Yeah, so we’ve run the experiment.
0:14:23 And oddly, when you ask our customers if they want cameras,
0:14:24 it’s very unpopular.
0:14:29 So the home care agency kind of industry today,
0:14:31 the way it does quality is either
0:14:34 what it hears from customers or random home visits.
0:14:36 We do random home visits.
0:14:38 We partner with our partners to do that.
0:14:39 We’ve actually started our own program
0:14:41 where we do it even outside of our partners.
0:14:44 But we get a ton of data from the app
0:14:46 that’s kind of inferred data
0:14:49 that can point you to where there might be problems.
0:14:52 And so even though you’re not seeing a signal
0:14:54 that says physical abuse,
0:14:57 you’re seeing signals that indicate
0:14:58 lack of care pro quality.
0:15:02 And then you can take action before, hopefully,
0:15:04 you end up in like a truly bad situation.
0:15:06 – How important is it for the caregivers
0:15:08 to be taken into consideration
0:15:12 in regards to their needs as a caregiver as well?
0:15:15 – So what you find broadly in the industry
0:15:18 is people usually will work
0:15:21 for like two or three agencies at a time
0:15:24 because each agency is too small
0:15:26 to have enough customers
0:15:29 that fit the very specific skills of that caregiver.
0:15:31 – I used to work with three agencies
0:15:35 because the thing is you always have to have plan A,
0:15:36 plan B, and plan C.
0:15:39 Because the thing is anything can happen with the elderly.
0:15:40 They can pass away.
0:15:42 They might have to budget.
0:15:44 So they cut down hours.
0:15:46 So you lose some of your hours.
0:15:48 And you don’t have that consistency.
0:15:49 Sometimes you lose a job
0:15:51 and what if you’re not a fit for the next client?
0:15:54 Then almost a week or two, you have no income
0:15:56 because you get paid as you work.
0:15:58 – So now all of a sudden you’ve got
0:16:00 like a 25 or 30% pay cut
0:16:03 because that agency doesn’t have new work for you next week.
0:16:04 So what do you do?
0:16:07 And so you have to kind of find another agency
0:16:09 that has work, which might conflict
0:16:10 with like one of those other agencies
0:16:11 you’re already working for.
0:16:16 And so thinking about how you can take care of someone
0:16:18 and even just like making sure
0:16:20 that you can get them very consistent hours
0:16:24 to support their needs in life is a really big deal.
0:16:25 And it’s part of the reason
0:16:28 why having a full network was very important.
0:16:30 So we’d have so much demand that Samantha,
0:16:34 and everybody likes Samantha, could keep consistent work.
0:16:36 – What does that look like when you log in
0:16:39 and like, you know, are you like a basketball player?
0:16:40 Like, yo, let me see what kind of numbers
0:16:41 I put up tonight.
0:16:42 Like, what do you?
0:16:45 – Yes, well, it actually some motivation, I think.
0:16:46 It helps a lot.
0:16:48 So you know, you keep yourself in check
0:16:51 because sometimes you could get very comfortable as well
0:16:53 when clients like you and you’re doing good
0:16:55 and you’re getting jobs and everything.
0:16:58 But you know, there are also times that it’s not the case.
0:17:02 So the app just doesn’t help you with how you’re doing.
0:17:04 Some clients will make you a favorite.
0:17:06 Some clients will give feedback to the agency
0:17:08 and then the care managers will let you know,
0:17:10 here are the things you can improve,
0:17:12 here are the things you’re doing really well.
0:17:13 So I think that helps a lot.
0:17:16 And then in the app also, you can see different clients.
0:17:18 And I think if you really know
0:17:21 which scope of practice you’re good at,
0:17:24 then by reading the care plans of different clients
0:17:27 that have available shifts, you will know if you’re a fit.
0:17:28 And when you apply for it,
0:17:32 it doesn’t really like approve you right away for that job.
0:17:34 The care managers normally check first
0:17:36 and then they allow you to work on that shift
0:17:39 based on your experiences
0:17:40 and if you’re a fit,
0:17:42 if they feel that you’re a fit for that work.
0:17:43 And Seth, with that, what would you say
0:17:45 that the average difference is
0:17:48 between somebody who’s on honor versus a caregiver
0:17:50 who’s not in terms of salary?
0:17:55 You know, that average difference is maybe 10%.
0:17:57 It’s not that much.
0:17:59 The difference is, do you get surprised
0:18:03 because all the sudden next week, the difference is 50%.
0:18:08 So what will happen is like, you’ve got two clients,
0:18:09 two different agencies,
0:18:11 half your times with one client,
0:18:12 half your times with another client,
0:18:13 one of those clients passes away.
0:18:16 50% pay cut next week.
0:18:19 So it’s like those moments of panic.
0:18:21 Because that literally can impact food
0:18:24 and that can impact transportation to school for your kids.
0:18:25 I mean, that’s a big deal.
0:18:28 And so it’s more about not having those
0:18:33 like momentary, extremely painful experiences.
0:18:36 I’ve never had no job.
0:18:38 Like I’ve always consistently have a job
0:18:41 because not only is their network big,
0:18:44 they work with different small agencies as well.
0:18:46 And they’re the ones that provide them with caregivers.
0:18:49 And especially me, I like to work during the nights.
0:18:52 And it’s always a challenge to have 24 hours
0:18:53 because of the expense as well.
0:18:55 Tell us a little bit about your life
0:18:58 and like at home and like, who are you taking care of?
0:19:00 Yeah, so I’m also a full-time mom.
0:19:03 So that’s why I always prefer to work during the night
0:19:04 so I can be with my son.
0:19:06 So yeah, I’m a full-time mom
0:19:08 and I’m also currently studying for my nursing
0:19:10 so that I can get back to my BSN.
0:19:13 So I’m doing that, I’m working on that.
0:19:14 And as at the same time,
0:19:16 I work at least four to five night shifts with honor.
0:19:20 So obviously the distance where you’re working as well
0:19:22 helps a lot because if you find clients
0:19:24 that are closer to where you live
0:19:25 or in the area where you live,
0:19:27 then that is also a bonus.
0:19:30 So those are one of the things that care professionals look for.
0:19:32 And of course, a start time as well
0:19:34 because like for me,
0:19:36 I have to drop my son to school and pick him up.
0:19:38 So almost I have to do a seven to seven
0:19:41 or seven 30 to seven 30 shifts
0:19:42 because if I do an eight to eight,
0:19:45 then I’m not going to be home enough to drop off my son.
0:19:47 And then like Seth was saying,
0:19:50 also what you’re trained to do,
0:19:52 what your capacity is as a caregiver,
0:19:54 because sometimes some clients are harder for you
0:19:56 and it’s just not going to work out.
0:19:58 When you look for a client as well,
0:19:59 it has to be a fit,
0:20:02 not only personality-wise, but also the job.
0:20:04 Am I going to be able to lift this person
0:20:07 or am I going to be able to help this person with his transfers
0:20:10 to help him go to the shower, the baths?
0:20:12 What are their expectations for my cooking,
0:20:14 for my meal preparation?
0:20:17 We don’t do any medications because we’re non-medical.
0:20:20 So that’s on the side, the families do that.
0:20:22 So these are things that you also look out,
0:20:25 the environment, what type of home I’m going into.
0:20:28 Obviously, you know, there are really nice homes
0:20:30 and there are homes that are different.
0:20:32 So those are things that you look for.
0:20:35 So the easy way to think about our heart
0:20:37 is to kind of match what people need
0:20:38 with what care pros can do.
0:20:42 Is if you think about like getting a car, Uber or Lyft,
0:20:45 a rider looks like a rider.
0:20:48 So like all of us look the same to Uber, basically.
0:20:51 And all the drivers, you know, look the same to Uber.
0:20:53 And so they just have to make a simple match.
0:20:56 We have to think about pretty complex stuff,
0:21:00 not just a personality basis,
0:21:03 but something like, okay, this person has diabetes
0:21:05 or this person has dementia.
0:21:07 This person has steps in their home
0:21:09 and they need lifting and transferring support.
0:21:14 So like, is this Care Pro a medium or a high
0:21:17 on the skill of lifting and transferring
0:21:20 because this customer needs support
0:21:22 to get out of bed and get into a wheelchair
0:21:24 and then get out of the wheelchair and get into a bath.
0:21:27 And then this person has cats.
0:21:29 And so the Care Pro for that home
0:21:31 has to be like a medium or a high
0:21:33 on lifting and transferring and not allergic to cats.
0:21:35 So now we’ve got like an innate skill,
0:21:39 which is basically, innately, you are or are not allergic to cats.
0:21:41 And then a learned skill, lifting and transferring.
0:21:45 And so matching is a very nuanced thing
0:21:49 because we would say that it’s a two-sided heterogeneous marketplace.
0:21:51 Everybody’s got different skills and different needs.
0:21:55 How do you find the caregivers to allow them to engage in this?
0:21:58 So we basically start top of funnel.
0:22:00 How do you find people in mass?
0:22:02 And most of that happens online.
0:22:04 So we tried stuff like going to nursing schools,
0:22:05 going to vocational schools.
0:22:08 We didn’t get the amount of volume that we needed.
0:22:12 So it turned out that online and using job networks
0:22:14 produced a pretty good top of funnel.
0:22:16 And then we have some automated systems
0:22:18 that basically figure out are people qualified
0:22:20 for kind of honor specific qualifications.
0:22:22 And then people go through a phone screen
0:22:25 and then people go through an in-person assessment.
0:22:28 And then ultimately they can be approved to be an honors platform.
0:22:31 Right now, it’s pretty hard to make it through the funnel.
0:22:34 Like the acceptance rate bounces between kind of five and 10%.
0:22:37 So we really are looking for like the best people.
0:22:38 What are you looking for?
0:22:41 Like, so if I wanted to get in, what do I need to be?
0:22:42 So it depends on the state a little bit.
0:22:44 So there are different requirements by state.
0:22:46 But fundamentally, you need to have six months
0:22:49 paid experience of being a caregiver.
0:22:51 You will have to have a clean drug test.
0:22:53 So we do drug tests to everybody.
0:22:55 And then we assess skills.
0:22:57 So like when people get to the point
0:22:59 where they’re coming in to honor,
0:23:02 they’ll literally do like a lifting and transferring exercise
0:23:02 in the office.
0:23:07 They’ll be assessed for like their familiarity with and comfort
0:23:08 with working with people with dementia
0:23:10 that Samantha was referencing.
0:23:12 So you’ve been for all these things.
0:23:13 So what about the families?
0:23:15 Like what happens when you run into that difficult
0:23:19 family member that’s just like all over the place?
0:23:21 And making it really difficult to get care for?
0:23:22 Like what happens there?
0:23:24 You know, so it’s really interesting.
0:23:26 There are customers who are super easy to serve.
0:23:29 There are customers that are super hard to serve,
0:23:31 kind of for two different reasons.
0:23:35 Either their needs, like their absolute needs are difficult.
0:23:39 Let’s say someone weighs 350 pounds
0:23:41 and they need lifting and transferring support.
0:23:42 That’s difficult.
0:23:45 Or let’s say someone’s kind of late-stage dementia.
0:23:46 That’s difficult.
0:23:48 And then there is this other kind of difficult,
0:23:49 which you’re referencing, I think,
0:23:51 which is personality difficult.
0:23:54 And it can be either the person who needs care
0:23:55 or it can be the family.
0:23:58 And so what we try to do there really is matching.
0:24:01 Again, it goes back to like this CarePro
0:24:04 with their personality and their skill set
0:24:06 is better for this particular kind of customer.
0:24:09 There’s also price differentiation.
0:24:13 So you might have a customer who is really difficult to serve.
0:24:17 And it might be that CarePros are paid more
0:24:21 to serve that person because of the unique needs of that person.
0:24:23 And so therefore, it earns a higher wage.
0:24:27 I agree with Seth that there can be very difficult clients
0:24:28 and difficult families.
0:24:31 And with my experience, it’s pretty amazing
0:24:33 because sometimes your client’s really awesome,
0:24:34 but the family’s not.
0:24:35 They’re hard.
0:24:36 We hear that a lot, actually.
0:24:36 Yes.
0:24:38 And I think that most of my clients,
0:24:39 that’s always been the problem.
0:24:42 That they’re pretty easy.
0:24:44 They get along with the caregivers.
0:24:47 But the family sometimes make it about themselves.
0:24:50 And they forget it’s about the people that we’re taking care of.
0:24:52 And that makes it a challenge.
0:24:54 So for example, I had a client before.
0:24:56 And then, well, he was living with a daughter
0:24:57 because the situation changed.
0:25:00 The mom couldn’t take care because she was elderly.
0:25:00 So he moved in.
0:25:02 The client moved in with a daughter.
0:25:04 And she was all over.
0:25:05 We are trained.
0:25:06 We do our jobs and everything.
0:25:07 But she was always there.
0:25:10 So it was hard to do your job.
0:25:11 And it makes it a challenge.
0:25:14 And she just sometimes tells you, oh, you need to do this.
0:25:16 And then she gives you instructions
0:25:18 and then changes it the next moment.
0:25:22 So that makes it challenging because you want to work in peace.
0:25:24 You want to go happy to your job.
0:25:26 Especially if you’re experienced.
0:25:27 You know what you’re doing.
0:25:30 You want them to trust you, but they don’t really trust you.
0:25:32 Literally looking over your shoulder.
0:25:32 Yeah.
0:25:33 So that makes it challenging.
0:25:35 And sometimes just family turmoil.
0:25:37 The siblings don’t get along.
0:25:39 Some people want different things for their parents.
0:25:41 The others want different things.
0:25:44 And they don’t get along so their parents go confused.
0:25:46 They’re like, so who am I going to follow here?
0:25:49 And then as a caregiver, that makes it challenging
0:25:51 because you go inside a job and then you’re like,
0:25:52 okay, so who are my bosses here?
0:25:53 Who do I listen to here?
0:25:55 Is it the client they take care of
0:25:58 or the children that are two sides telling me what to do?
0:25:59 Who do you listen to?
0:26:01 To my client and to honor.
0:26:04 So if I almost call honor and my care managers,
0:26:06 if there’s anything like that that happens
0:26:08 and I feel uncomfortable,
0:26:10 I make them deal with the family members.
0:26:12 And they’re the ones that call and say,
0:26:14 hey, the caregiver’s saying that this and this.
0:26:16 And if they really like you,
0:26:17 they’ll try to mend things a little bit
0:26:19 because they don’t want to lose you
0:26:21 because they know that they can trust you
0:26:22 to take care of their parents.
0:26:23 But you need to talk to them.
0:26:27 One thing that we find is honor’s platform
0:26:30 is great for noticing like, look,
0:26:33 this family member called and said a care pro is late.
0:26:35 But they weren’t late because we’re tracking the GPS check.
0:26:36 Yes, we have the app.
0:26:37 So you cannot clock in or clock out
0:26:40 unless you’re in the premises of the client.
0:26:43 And so why would the family say they’re late
0:26:43 if they’re on time?
0:26:47 Probably what happened is the mom or dad
0:26:50 told their son or daughter that the care pro is late.
0:26:52 And probably that person has dementia
0:26:54 or actually we’ve discovered
0:26:55 that it’s a good way to find out
0:26:57 when people are slipping into dementia.
0:26:59 So like no one knew.
0:27:01 And then they kind of tell their kids,
0:27:04 hey, you know, Samantha was late
0:27:06 and it’s like, well, she wasn’t.
0:27:07 And it happens too often.
0:27:10 You know, my grandmother had dementia at the end
0:27:12 and I was living with her in New York
0:27:13 because I was going to school there
0:27:16 and convincing my father that that was the case
0:27:18 because she would answer the phone to talk to him.
0:27:21 And she was, you know, like that was her.
0:27:23 She would say, okay, I’m going to get my best five minutes
0:27:24 in right now.
0:27:27 And she would be sharp, witty, interesting,
0:27:28 this and that and the other.
0:27:29 And then the next thing, you know,
0:27:31 she would watch the same news program
0:27:32 like six times in a row.
0:27:34 And I’m like, no, grandma’s slipping.
0:27:35 Oh, no, no, grandma’s fine.
0:27:36 And so it is-
0:27:38 I had a client that actually said I wasn’t there.
0:27:42 When her family called, she said, nobody’s here.
0:27:44 And I’m like, well, I’m right here.
0:27:46 And so they hear me over the phone.
0:27:49 And then they say, oh, Samantha, we’re glad we know you’re there.
0:27:51 You know, because they know that they hire you
0:27:53 and they know that you’re supposed to be there.
0:27:55 But when they talk, sometimes they’re like,
0:27:57 as if nobody’s there, like they’re on their own.
0:28:00 And that’s their part of, you know,
0:28:01 wanting to do things by themselves.
0:28:03 You know, because, you know,
0:28:05 they’ve lived all their life being independent.
0:28:06 You live here in America.
0:28:06 You have no help.
0:28:08 You do everything for yourself.
0:28:10 And then now you start to accept help from other people.
0:28:12 That’s kind of like a challenge for them.
0:28:14 How have families responded to that, though,
0:28:17 when there’s a recognition that their love one is slipping
0:28:19 into dementia and when they weren’t even aware?
0:28:22 So there’s a saying, the customer’s always right.
0:28:25 And so when you don’t have the data,
0:28:27 you assume the customer’s always right.
0:28:30 And you say to the family, oh, I’m so, so sorry.
0:28:32 We’ll make sure that that care pros not late again.
0:28:34 But when you have the data,
0:28:37 it’s so powerful because it helps the family.
0:28:39 You’re able to say, you know what?
0:28:39 You’re not right.
0:28:42 But that helps because now you recognize
0:28:44 that your mom has a new need.
0:28:48 And so we actually have a process around
0:28:51 what we call reevaluation, where we have a customer,
0:28:53 we’re serving them with a certain care plan.
0:28:55 And then we learn some stuff, either, you know,
0:28:57 care pros report something that happens in the home
0:28:59 or the family reports something
0:29:01 or our partner reports something.
0:29:03 And so then we will reevaluate their customer
0:29:06 because people actually do sometimes in honor,
0:29:08 believe it or not, get better, right?
0:29:09 So I had a knee replaced, a hip replaced,
0:29:12 they need us for a little while and then they get better.
0:29:15 But sometimes people, you know, progressively have more needs.
0:29:20 And so if honor can use our data to both kind of protect
0:29:23 care pros and treat them justly at the same time
0:29:26 that we help the family understand
0:29:28 like the real state of how mom is doing
0:29:31 and then provide better care for mom as a result,
0:29:32 everybody actually wins.
0:29:35 It might be hard in the moment, but everybody wins.
0:29:37 So Samantha, how did you feel like shifting
0:29:39 from the old model to the new model?
0:29:41 They make it very easy, you know,
0:29:43 for everyone to use, obviously,
0:29:45 my prior agencies, they didn’t have the app,
0:29:47 so you wouldn’t know what jobs you have there.
0:29:50 So basically you’re at home waiting for a call
0:29:53 to have a job with the prior agencies.
0:29:55 They would call you like a million times.
0:29:57 And sometimes you tell them, I’m not available.
0:29:59 And then they still call you and I’m like,
0:30:02 I just told you guys I’m not available today.
0:30:05 Aside from the communication was always, you know,
0:30:08 all over the place, there was no consistency of jobs.
0:30:11 Here it gives you like a sense like, oh, okay,
0:30:14 I don’t have a job today, but I’ll check the app.
0:30:15 And if they have other shifts,
0:30:17 then you have to make a little bit of a sacrifice
0:30:19 to take some shifts.
0:30:21 But at least you know you’re going to earn something
0:30:24 while you’re waiting for something that you’re looking for.
0:30:26 That’s one thing that caregivers like to know,
0:30:27 am I going to have a job tomorrow?
0:30:30 That’s very important, especially in the field
0:30:31 that you’re dealing with life.
0:30:33 Because you never know.
0:30:35 One of the design points when we were thinking about the app
0:30:39 that care pros use is we wanted to make sure it showed them
0:30:40 that there was always more work.
0:30:42 Because there’s this underlying stress.
0:30:43 It is.
0:30:45 Like sometimes I have clients that are,
0:30:46 you know are already in hospice.
0:30:49 So basically, you know what hospice, it’s pilotive care.
0:30:52 You already know that some point they’re going to go.
0:30:53 But you don’t look at it that way.
0:30:55 If you know that it’s okay,
0:30:58 I’m going to stay here until this happens.
0:30:59 Because this is my job right now
0:31:01 and my loyalty is towards my clients.
0:31:04 And being there for them in the hardest times of their life.
0:31:06 And being a support to the family.
0:31:07 And then after that,
0:31:09 you know that honors got your back.
0:31:11 They’re going to give you another patient.
0:31:13 Even if you love taking care of people,
0:31:16 like the job structure is so bad,
0:31:18 do you think that more people will want to go into
0:31:19 and stay in the field?
0:31:22 So I think there are two things that we measure
0:31:23 that kind of show that.
0:31:26 One is just how happy are care pros.
0:31:29 And so the net promoter score,
0:31:31 which is how likely are they to recommend something to your friend,
0:31:34 so our net promoter score is about twice
0:31:37 the net promoter score of Google employees.
0:31:40 The second thing that we really focus on
0:31:42 is what is the churn
0:31:44 or what’s the retention of care pros.
0:31:45 So this is crazy,
0:31:48 but in home care today,
0:31:52 on average, it’s 82% churn a year.
0:31:57 So that means only 18% of care pros on average
0:32:00 will stay for a year with an agency.
0:32:04 And at honor, two-thirds of our care pros
0:32:05 are what we call optimized.
0:32:07 They’re like in a market where we have enough work,
0:32:09 we’re dense enough, et cetera.
0:32:12 And their churn is 32%.
0:32:14 And what do you credit that difference to?
0:32:15 Like people will churn.
0:32:21 So you can literally decipher mile by mile in a given city.
0:32:23 Like if Samantha lives in one place
0:32:24 and a customer lives in another place,
0:32:28 what is that person’s likelihood of churning?
0:32:30 Mile by mile in a 30-day period.
0:32:33 So it’s the increasing satisfaction
0:32:35 then literally becomes density of the network.
0:32:36 One thing’s density,
0:32:38 but like another thing,
0:32:39 people have shadow schedules.
0:32:41 So if you schedule someone
0:32:44 for kind of a long-term assignment
0:32:45 in a shadow schedule,
0:32:46 which is when they don’t actually really want to work,
0:32:49 then they will not stick and they’ll churn
0:32:50 because it’s not good for them.
0:32:52 Another thing is like,
0:32:55 if someone is not, let’s say,
0:32:57 well-dementia trained in a home with someone with dementia,
0:32:59 other than a bad customer experience,
0:33:01 like the carepro does not like that
0:33:03 because they know they’re not doing a great job.
0:33:04 They don’t feel good.
0:33:06 They feel bad.
0:33:06 And so they churn.
0:33:10 So it’s all of this stuff kind of mixed together
0:33:13 that then drives this really low churn rate that we have.
0:33:16 And that I think is like super critical.
0:33:18 And to that end, like what do you do?
0:33:21 How do you approach training for care pros?
0:33:23 So there’s training when people start.
0:33:25 There’s annual or current training.
0:33:26 And then we’ve built training material
0:33:28 into the app on a website
0:33:30 and literally just even in the use of the app.
0:33:31 So it’s even little stuff.
0:33:34 Like one thing we found early on is,
0:33:36 oh my God, so many people are like checking in
0:33:37 when they’re not at the homes.
0:33:39 But you cannot say to everybody,
0:33:41 hey, like you’re fired, right?
0:33:45 It was clear the industry just structurally did this.
0:33:47 So it became a cultural norm.
0:33:49 We intentionally did this in a very specific way.
0:33:52 If you try to check in when you’re not yet at the home,
0:33:54 we don’t say you can’t check in.
0:33:58 We say, it looks like you’re not at the home.
0:34:00 Are you sure you want to check in?
0:34:01 And that’s training.
0:34:02 Yeah, yeah, I see that.
0:34:03 So you build it in.
0:34:05 Yeah, so that’s exactly what they actually build.
0:34:07 You build the culture into the app.
0:34:10 We work to treat the care pros as true professionals.
0:34:13 And what true professionals get is,
0:34:16 here’s what’s expected of you.
0:34:19 Here are tools to help you do that.
0:34:21 Here’s training to help you do that.
0:34:23 And we’ll put you in the right environment
0:34:26 where you are uniquely suited to succeed
0:34:28 and then tell you how you’re doing,
0:34:30 and then rewards or consequences.
0:34:32 And Samantha, what kind of training
0:34:34 do the other agencies provide?
0:34:37 So I actually used to train a lot of care professionals
0:34:39 for an agency that I used to work.
0:34:42 And basically, they hire you.
0:34:43 But the first two years,
0:34:44 you need to have experience already,
0:34:47 like working in another agency,
0:34:49 but not taking care of a family member.
0:34:51 Because sometimes they use that as experience.
0:34:52 Like, oh, I took care of my grandmother.
0:34:54 I took care of my son.
0:34:55 I took care of anybody that’s ill.
0:34:56 No.
0:34:58 And then we have a whole list of policies
0:35:00 that you need to follow,
0:35:02 what are the things that you can’t say, and all that.
0:35:05 So we run down different trainings.
0:35:09 Some agencies also provide different online trainings.
0:35:10 So like you watch a video,
0:35:12 and then at the end of the video,
0:35:15 they score you and then they give you a certificate for that.
0:35:17 So it’s not always physical training,
0:35:19 but you do every year.
0:35:20 You have to do at least,
0:35:23 I think there’s 10 prerequisite trainings
0:35:25 that you have to do every year
0:35:26 to continue your caregiving.
0:35:29 Just keep your license and all that, right?
0:35:30 And then so we train them
0:35:33 based on what they feel they’re locking.
0:35:35 Safety is very, very important
0:35:36 when you’re doing this type of job.
0:35:40 So yeah, we train them from safety precautions
0:35:43 and transferring and how to be polite
0:35:46 to even just proper hand washing.
0:35:49 Thank you so much for being here, Seth and Samantha.
0:35:51 Thank you so much for sharing and for creating the platform
0:35:54 to help healthcare providers get work,
0:35:57 but also help families get the type of quality care
0:35:58 that they need.
0:35:59 And thank you, Samantha,
0:36:02 for doing the most noble work that there is.
0:36:07 You know, we’re all owe a debt to you and your colleagues.
0:36:09 Thank you very much, and thank you for having me.
0:36:09 Thank you.
0:36:10 Awesome. Thanks, Samantha.
0:36:11 Thanks, y’all.
0:36:19 [Music]
0:36:29 [BLANK_AUDIO]

0:00:02 (upbeat music)
0:00:15 – Welcome to Hustling Tech.
0:00:19 The show that helps you if you have ambition and drive
0:00:21 and need to get started,
0:00:23 get into the tech world
0:00:27 and take advantage of the opportunities.
0:00:32 Today with us we have Iman who is CEO of Incredible Health
0:00:37 and Stephanie who is a hustler on the platform.
0:00:41 Now also with me is my co-host as always Shaka Senghor
0:00:43 who hustled his way out of the joint
0:00:46 and became a bestselling author
0:00:48 and all kinds of other stuff.
0:00:49 – So we’re excited to talk to you all today
0:00:52 about all the amazing things that you all have been doing.
0:00:55 I think that the first question I have is like,
0:00:56 what was your why?
0:00:59 So my why, so by background, I’m a medical doctor.
0:01:01 I don’t practice at all anymore.
0:01:02 A lot of my family members and friends
0:01:04 are doctors and surgeons
0:01:07 and they were often complaining about understaffing,
0:01:09 especially not having enough nurses on the floor,
0:01:13 not wanting to rely on travel nurses or contract nurses
0:01:14 to take care of their patients.
0:01:17 And then at the same time, my co-founder, Rome Portlock,
0:01:19 he’s a software engineer from MIT.
0:01:21 He’s been building software for 15, 20 years
0:01:23 with sisters or nurses.
0:01:25 And even though they’re experienced and qualified,
0:01:27 they’re saying it still takes me at least two,
0:01:29 three months to get my next job.
0:01:32 And we’re like, okay, this doesn’t make any sense.
0:01:35 And what we discovered is a lot of the processes,
0:01:39 the tools, the software that HR teams at hospitals
0:01:41 are using are very outdated.
0:01:43 They haven’t actually changed since,
0:01:45 I don’t know, late ’80s, early ’90s.
0:01:47 We figured there just has to be a better way.
0:01:51 Incredible Health is the fastest growing hiring platform
0:01:53 for nurses in the US today.
0:01:55 Hospitals and health systems use the platform
0:01:59 to hire nurses in permanent roles in less than 30 days
0:02:01 instead of it taking 90 days or longer.
0:02:05 – Wow, and why did you do it the way you did
0:02:06 instead of just saying, okay,
0:02:08 well, build software for hospitals
0:02:09 or something like that?
0:02:10 Why did you– – I think there were a couple
0:02:13 of reasons why we took a more comprehensive approach.
0:02:16 One is we understood the market
0:02:18 and there’s some fundamental problems
0:02:19 like the nursing shortage.
0:02:21 And to put it in context,
0:02:22 that shortage is three times bigger
0:02:24 than the software engineering shortage.
0:02:28 And so our demand for healthcare keeps going up,
0:02:29 but there are just simply not enough
0:02:31 healthcare workers in the system.
0:02:34 – How do we land here where, like, what is the–
0:02:35 – They’re not paying enough.
0:02:36 – Yeah, they’re not paying enough, yeah.
0:02:40 – Yeah, there’s probably two bottlenecks.
0:02:42 The first is the number of people
0:02:44 getting accepted to nursing schools.
0:02:46 – Nursing school is very competitive.
0:02:48 It has a lot of wait lists.
0:02:50 Once you apply to go into the nursing school,
0:02:53 you’re not guaranteed to get in immediately.
0:02:54 You have to go through some process.
0:02:55 You have to wait.
0:02:59 So that’s why we have such shortage.
0:03:00 – And then the other big huge bottleneck
0:03:03 is what happens right after nursing school.
0:03:06 So unlike doctors, we have residency programs,
0:03:10 honestly, that are mostly funded by the government.
0:03:11 But when it comes to training nurses,
0:03:14 it’s the hospitals that bear the majority of that cost.
0:03:18 And so they don’t always see a strong ROI
0:03:19 on those training programs
0:03:21 because nurses go through it
0:03:23 and then they often leave
0:03:26 because they’re next opportunity.
0:03:29 So it is actually quite hard for a new graduate nurse
0:03:30 to land their first job.
0:03:33 They have to be very geographically flexible
0:03:34 in order to do that.
0:03:36 No, once you’re at a Stephanie stage,
0:03:38 when you have a few years under your belt,
0:03:40 and that is a sweet spot,
0:03:44 where if you have one or two years of experience,
0:03:46 you’re pursuing a specialty already,
0:03:51 you will get a job very quickly on our platform.
0:03:52 – Oh, wow.
0:03:54 So how long have you been a nurse, Stephanie?
0:03:55 – For three years now.
0:03:57 – Well, it started at the beginning.
0:03:58 – Well, I’m Nigerian.
0:04:02 I grew up in Nigeria, most of my adulthood,
0:04:04 and I left Nigeria at the age of 19.
0:04:07 There are two reasons that pushed me to become a nurse today.
0:04:11 The first one was I was sick back home in Nigeria,
0:04:13 and I had surgery.
0:04:17 It was appendix, just a minor surgery,
0:04:19 but it ruptured.
0:04:23 And I developed sort of an infection,
0:04:26 and they were incapable of handling it,
0:04:29 and it went to a point where I almost lost my life.
0:04:32 So the reason why I’m actually sitting
0:04:35 and talking to you guys is because my mom actually
0:04:38 walked with a doctor that she could rely on,
0:04:41 and she had to look for him to perform the surgery for me.
0:04:44 And that’s really saved my life.
0:04:47 So that was one of the reasons I decided to become a nurse.
0:04:49 And the second reason was
0:04:51 I didn’t immediately push through the nursing career.
0:04:53 I went into business
0:04:56 because I wanted to help my dad out in his business.
0:04:59 So that’s why I went into business administration.
0:05:01 But I was like, I’m not doing this for myself.
0:05:03 I need to do something for me.
0:05:06 And what triggered it was when I was doing my dissertation
0:05:09 in one of the biggest hospitals in Malta.
0:05:11 It’s called Matter Day.
0:05:14 I was able to communicate with nurses and doctors,
0:05:18 and I was like, no, this is where I belong.
0:05:21 So that was where I decided I was going to go into nursing.
0:05:22 I called my brother.
0:05:23 My brother was here.
0:05:25 He’s been here in America for the longest.
0:05:27 So he told me, oh, if you want to do nursing,
0:05:29 come to America and do it.
0:05:31 And that was where I started.
0:05:34 Like I came over, I started with cancers
0:05:35 where I did my pre-nursing,
0:05:39 and then I moved over to Atlanta, Georgia,
0:05:41 where I finished up the nursing school,
0:05:44 and I started walking at Northside Hospital Atlanta.
0:05:47 And then I finally moved here to California.
0:05:50 And the nursing program, it was difficult to get in.
0:05:50 I will not lie.
0:05:53 It was very difficult to get into the program.
0:05:55 And what made it difficult?
0:05:58 Was it the process was difficult?
0:05:59 The process was difficult.
0:06:00 There are a lot of waiting lists.
0:06:04 So you can imagine applying Wednesday’s waiting list.
0:06:07 So they go for those who are in the waiting list before you.
0:06:12 I actually stayed home one more year after my prerequisites.
0:06:13 And then when it was time for me,
0:06:17 I started at Chamberlain College of Nursing in Atlanta, Georgia,
0:06:21 because I just moved to California three months ago.
0:06:24 And then I stayed there for two years.
0:06:26 It was very–
0:06:29 nursing school is very chaotic.
0:06:31 We go through a lot.
0:06:33 I nearly gave up.
0:06:36 I nearly gave up nursing school.
0:06:39 I don’t know how to explain it, but it’s difficult.
0:06:41 Not everybody goes in that comes out.
0:06:46 I started with a lot of friends, and a lot of them left.
0:06:48 So that could be another reason to get away.
0:06:50 We’re having the nursing shortage,
0:06:54 because they make it very, very rigorous.
0:06:57 It makes sense once you get into the nursing itself,
0:06:59 because they’re training you to take care
0:07:01 of these critically ill patients.
0:07:04 So you have to meet up to that standard.
0:07:07 That’s why they really screen us in school.
0:07:09 The other thing, it’s a regulated profession.
0:07:12 So just like many other health care professions,
0:07:16 you have to have licenses, you have to have certain certifications.
0:07:17 Makes sense.
0:07:21 Yeah, so the regulation part, who puts the cost of getting
0:07:22 the licenses and all that?
0:07:26 Is that on the student nurse, or is it some type of stipend?
0:07:28 How does that work out?
0:07:31 The hospital I applied to, where I got my first nursing job,
0:07:33 paid for it.
0:07:36 So that was OK by me.
0:07:39 I got the job before I graduated.
0:07:41 So they told me, oh, they’re going to pay for it,
0:07:43 as long as you pass the boards.
0:07:46 So I paid, and they funded it back to me.
0:07:48 But Stephanie was in the fortunate position
0:07:50 of having the job already lined up.
0:07:52 So now, if you don’t have a job lined up,
0:07:54 many nurses have to pay out of pocket.
0:07:58 So before I found incredible health,
0:08:00 I decided I was going to move to California
0:08:02 to be close to family.
0:08:07 I was putting in my application in so many hospitals,
0:08:09 and I didn’t get any callback.
0:08:11 I just get this automated email saying,
0:08:14 oh, unfortunately, we consider other candidates.
0:08:16 It’s not that you are not qualified,
0:08:19 but there were too many people that applied.
0:08:22 Which is pretty weird, given there’s a nursing school.
0:08:25 Those same hospitals, you find them looking for nurses
0:08:26 to work for them.
0:08:30 So I didn’t just understand why that was happening.
0:08:32 So it was my brother that told me to try it.
0:08:35 So I just filled in my application with incredible health,
0:08:39 and I just got a call immediately,
0:08:43 and they told me, oh, this is how it works.
0:08:45 And once any hospital is interested in you,
0:08:48 they will send a message, you just respond,
0:08:52 and it was kind of like an easy way
0:08:55 and different process applying to hospitals.
0:08:57 The employers are coming for you,
0:08:59 not you going to them, they’re chasing you.
0:09:01 – So you’re an NBA player at the end.
0:09:03 – Exactly, exactly.
0:09:05 The employers apply to the nurses
0:09:07 instead of waiting for the nurses to apply to them.
0:09:08 – Yes. – No, that’s awesome.
0:09:13 – So with that model, do you end up at different hospitals
0:09:17 or private practice, how does that work, the model itself?
0:09:20 – So you have a lot of hospitals applying to you.
0:09:22 So you have that opportunity to be like,
0:09:25 oh, no, I don’t want this one, I want this one.
0:09:26 That’s what I was doing.
0:09:28 I had lots of hospitals that wanted
0:09:29 to have an interview with me,
0:09:33 but I already had the list of hospitals I wanted to go for,
0:09:35 and those are the ones I selected.
0:09:40 So you just as an advantage to choose what you really want.
0:09:42 – Yeah, so when a nurse, we say,
0:09:45 when a nurse goes live on our platform,
0:09:46 means they’re actively looking,
0:09:48 actually within days,
0:09:50 they can get several interview requests
0:09:51 from multiple hospitals.
0:09:53 And then we give them three days,
0:09:56 which interviews to accept and which ones to decline.
0:09:58 For those that get accepted,
0:10:01 our software also facilitates that first phone screen
0:10:03 with a recruiter, and we also,
0:10:05 our customer support team supports both the nurse
0:10:07 and the recruiter through the end,
0:10:08 all the way to the end of the process.
0:10:10 So no one gets dropped in the funnel.
0:10:13 – So in my source, that means that on any given week,
0:10:15 you can be at different hospitals.
0:10:16 Like, is that how it works?
0:10:18 What I’m getting at is,
0:10:20 so once that process happens, you get accepted,
0:10:24 can you work for this hospital today, Tuesday, Wednesday?
0:10:26 Am I at another hospital next week?
0:10:27 Like, does it work like that?
0:10:29 Or is it like, this is my place,
0:10:30 this is where I’ll be working for?
0:10:31 – Yeah, great question.
0:10:33 The nurses on our platform are getting hired
0:10:36 for, you know, as employees at the hospitals.
0:10:40 We’ve intentionally stayed away from contract work
0:10:42 and temporary labor,
0:10:45 because honestly, that’s not what the hospitals want.
0:10:47 They’re urgently looking for permanent labor.
0:10:48 And then the other thing we guarantee,
0:10:50 both to the nurses and the hospitals,
0:10:52 is hires in less than 30 days.
0:10:55 The average on the market is 82 days.
0:10:59 So we really dramatically try to bring down
0:11:01 that days to fill to less than 30 days.
0:11:02 – That’s amazing.
0:11:04 – I mean, I just think it’s really so interesting
0:11:07 that because of the struggles that so many communities go to
0:11:09 just to get quality healthcare.
0:11:11 So I think, you know, having something that’s bridging
0:11:13 that gap, how has it been received in the industry though?
0:11:16 Like, what has the response and reaction been?
0:11:18 – It’s been extremely positive.
0:11:20 When we started, we were just in California
0:11:22 and we’re currently expanding nationally.
0:11:25 So we work with all the top academic medical centers
0:11:26 like Stanford and Cedar Sinai.
0:11:28 Stephanie actually got her job at Stanford.
0:11:30 She’s at the brand new hospital here.
0:11:31 – All right, all right.
0:11:35 Yeah, so they, you know, my partner, Mark Andreessen,
0:11:38 his wife donated the Stanford emergency room.
0:11:41 Andreessen Ariaga emergency room.
0:11:42 – That’s awesome.
0:11:44 We work with all the big health systems
0:11:47 like HCA and Tenant and Providence St. Joseph
0:11:50 and lots of community hospitals too.
0:11:53 And so we really perfected the platform
0:11:55 and our processes here in California first.
0:11:58 And then a few months ago started to expand nationally.
0:12:00 And so now we have help, academic medical centers,
0:12:02 big health systems and community hospitals
0:12:04 and other parts of the country too.
0:12:07 – Now that you’ve got kind of the marketplace up and running,
0:12:10 generally, you know, we analyze marketplaces.
0:12:13 We always talk in terms of kind of supply and demand.
0:12:15 And like, where do you have the bottleneck?
0:12:18 And it seems like given there’s a nursing shortage,
0:12:21 you’re gonna, getting nurses is always gonna be
0:12:24 a little harder than getting hospitals, I would think.
0:12:25 Is that right?
0:12:25 – That’s right, yeah.
0:12:28 – And so how do you think, you know,
0:12:30 how do you think about that as things evolve
0:12:34 and what your role is in kind of getting more nurses
0:12:35 into the market?
0:12:37 – Yeah, I mean, in terms of getting the nurses
0:12:40 on our platform, all of it really starts with our mission
0:12:42 and the mission is to help healthcare professionals
0:12:44 live better lives and help them find
0:12:45 and do their best work.
0:12:47 In general, this is a group that isn’t,
0:12:51 this group of workers that’s not treated particularly well.
0:12:52 You know, there’s a lot of burnout.
0:12:56 So we wanted to be the one company and service
0:12:58 and platform out there that’s giving them
0:13:00 the best experience possible.
0:13:03 And so really that’s like the core of what attracts
0:13:05 the nurses to the platform is that very strong value
0:13:08 proposition that, hey, create a profile,
0:13:10 sit back and relax, hospitals will apply to you.
0:13:14 And now in terms of that, that actual messaging
0:13:16 and how it gets out, it’s a really a combination
0:13:18 of marketing and product.
0:13:20 What we’re doing on our platform is we’re also providing
0:13:23 a whole suite of free tools and software for nurses too.
0:13:27 So salary calculators and, you know,
0:13:29 completely free continuing education
0:13:31 that’s paid for by Incredible Health.
0:13:32 Where they can–
0:13:34 – So you can go from being like an LVN to an RN
0:13:35 and that kind of thing.
0:13:38 – Yeah, so that’s, and then the other thing is really
0:13:39 building community around this,
0:13:43 both offline community of nurses and also, you know,
0:13:45 creating more of an online community for nurses as well.
0:13:47 So there’s one place that they can congregate.
0:13:49 – Yeah, Stephanie, when you first,
0:13:51 when your brother introduced you to it,
0:13:53 like, how did you approach it?
0:13:54 So he comes to you and is like,
0:13:57 hey, here’s an opportunity, let me get you in the game.
0:14:00 Like, what was that, what was your initial reaction
0:14:03 to the introduction to the platform?
0:14:06 – It was different and I was like,
0:14:09 I was like, I want to see what this is all about.
0:14:13 And that was where I got to see it’s a better way
0:14:17 to like get nurses to get job faster.
0:14:19 And I was really impressed with it.
0:14:22 So that’s why a lot of my friends, nurses,
0:14:25 that are in Atlanta, Georgia that have plans to come over,
0:14:28 everybody’s looking forward to using it
0:14:30 because it’s just easy.
0:14:34 And you don’t have to like deal with the long wait,
0:14:37 the rejection emails that are automated.
0:14:42 You’re not like communicating with the hospital
0:14:44 on how to get your interview set up.
0:14:46 They are doing it for you.
0:14:47 All you just need to do is to get the dates
0:14:49 that is convenient for you and just show up
0:14:50 for your interview.
0:14:52 It was stress free, hustle free.
0:14:53 – And what does that look like?
0:14:55 Like in terms of the continuing education,
0:14:58 I’m always interested in different ways to learn.
0:15:00 So what does that look like on a platform?
0:15:03 – Yeah, so nurses annually have to get
0:15:06 continuing education like credits or units.
0:15:09 And that’s to maintain their specialization
0:15:11 or maintain their experience.
0:15:15 And in some cases, to get a specific state license,
0:15:16 you need to have a certain number
0:15:18 of continuing education like credits basically.
0:15:21 And a lot of these are online courses actually,
0:15:23 and they’re across different topics.
0:15:26 You know, we can cost hundreds of dollars a year.
0:15:28 And so we’re just bearing that cost for nurses.
0:15:30 Whether they’re using our platform
0:15:31 for getting a job or not,
0:15:32 it’s gonna be available to all nurses.
0:15:34 – So it sounds like it’s almost like
0:15:39 you are kind of CAA for nurses.
0:15:43 Which is Creative Artist Agency,
0:15:46 which is one of the biggest talent agencies in the world.
0:15:49 And so when you do that,
0:15:54 do you start to think about an individual nurse’s profile
0:15:56 and reputation so that you can market them better?
0:15:57 Or how do you approach that?
0:16:00 – Yeah, we spend a lot of time thinking
0:16:02 and working on improving nurse profiles.
0:16:05 And it’s everything from the actual profile itself
0:16:07 and the different fields that we’re collecting,
0:16:11 ’cause we are automatically with a lot of software screening
0:16:12 and matching them as well.
0:16:15 So this isn’t humans doing it, it’s all software doing it.
0:16:16 ‘Cause if you’re a recruiter,
0:16:18 you don’t want to log in and see 200 nurses.
0:16:20 You want to see 14 that are the right fit
0:16:22 for you at that time.
0:16:24 And that saves them a considerable amount of time too.
0:16:28 – And ’cause a nurse has got to have a specialization
0:16:30 and a location and some kind of background
0:16:32 for that to be a fit, okay.
0:16:35 – We’re matching on probably 40 or 50 different attributes.
0:16:36 Some of the attributes are things
0:16:39 like specialty licenses, certifications,
0:16:42 location preference, commute times.
0:16:44 And then in addition to the profile,
0:16:46 we’re also providing interview preparation too.
0:16:49 – You also apply this to like dating apps.
0:16:51 – So it’s funny you say that.
0:16:53 So chief nursing officers refer to us
0:16:55 as the match.com of hospitals and nurses,
0:16:58 which is kind of embarrassing, but it’s accurate too.
0:17:02 – So Stephanie, so listen to like the kind of the profile
0:17:04 and breakdown of like the matching process.
0:17:06 Like what were some of the things specifically
0:17:08 that you had to kind of share to figure out
0:17:10 how you matched up with the people
0:17:12 who you was looking to be hired by?
0:17:16 – So I was looking at my commute and the,
0:17:18 ’cause I wanted something in the Bay Area.
0:17:23 So I chose something I can, a place I can drive to.
0:17:24 I don’t need to drive more than 30 minutes.
0:17:26 That was my goal.
0:17:29 And that was one of the reasons I chose Stanford.
0:17:33 And I also chose Stanford because of the reputation
0:17:35 and the experiences there too.
0:17:40 So those were part of the, those were part of my selections.
0:17:40 – Yeah, I mean,
0:17:42 one of our goals is the nurse has no idea
0:17:44 what’s going on behind the scenes
0:17:46 when it comes to screening and matching.
0:17:49 And it just seems like a magical process.
0:17:50 – Well, that’s why the rejection letters.
0:17:53 You’re rejected, you’re qualified,
0:17:57 but you don’t match on some criteria
0:17:59 that you don’t know about.
0:18:01 And so that’s, okay, so that’s really interesting.
0:18:04 And then if somebody does an interview
0:18:06 and doesn’t get the job,
0:18:09 is there a feedback process for how does that work?
0:18:11 – Anytime a nurse doesn’t proceed in the hiring process,
0:18:14 we, we’re, you know, recruiters are able to enter
0:18:16 the reasons why they were not hired.
0:18:19 And each nurse on our platform is paired
0:18:21 with what we call a talent advocate.
0:18:23 These are members of our team.
0:18:25 They are all RNs as well.
0:18:28 And I think of them as like advocates
0:18:30 or career coaches for every nurse.
0:18:32 So that’s like a, also like a free service
0:18:34 that we provide to the nurses too.
0:18:38 – So one day every hospital in America
0:18:40 and every nurse is going to be on the platform.
0:18:43 What can you do at that point?
0:18:45 – So number one we talked about was the shortage.
0:18:47 And then the other one is just the inefficiency
0:18:48 in the market, like the right, you know,
0:18:52 the hospitals and nurses aren’t even finding each other.
0:18:53 A lot of what we’ve built so far
0:18:55 and what we’ve worked on so far
0:18:57 is to solve the inefficiency problem, right?
0:18:58 How do we get the right nurses
0:19:00 at the right hospitals quickly?
0:19:03 – Right, and that actually addresses the shortage
0:19:06 in many ways in that it’s not just
0:19:09 that the nurses and theorists said you can’t find them.
0:19:12 – Correct, yeah, it’s like ships passing each other
0:19:15 through the night, like they just don’t find each other.
0:19:20 And in terms of solving the actual underlying
0:19:23 nursing shortage, honestly, I know it’s something
0:19:25 we want to tackle because it’s part of our mission
0:19:26 and our vision.
0:19:28 I don’t know exactly how that’s going to look like yet.
0:19:32 One of the interesting pieces of the story of CAA is
0:19:36 before CAA, top actor or actress would make, you know,
0:19:39 maybe $500,000 on a film.
0:19:43 After CAA, 20 million, why?
0:19:48 Because every top actress and actor in the late 80s
0:19:51 was on the CAA platform.
0:19:54 So they could basically say you can’t make a movie
0:19:58 without us and the economics switched and flipped around
0:20:01 and put the power in the hands of the people
0:20:03 making the movies and in healthcare.
0:20:06 I mean, I know this just ’cause, you know,
0:20:10 my mother was a nurse, nurses are actually way more important
0:20:14 than the hospital hierarchy treats them often.
0:20:15 – Yeah.
0:20:16 – And that actually has more variance in your outcome
0:20:17 than anything.
0:20:22 So do you see a time in the future where by having
0:20:25 all the nurses collectively together,
0:20:29 you can actually make the profession more attractive?
0:20:29 – We’re already seeing that.
0:20:32 So on average on our platform,
0:20:35 the nurses salary increases by 17%
0:20:37 and commute time goes down by 15%.
0:20:41 There’s actually several reasons why nurses change jobs.
0:20:43 One reason is I want to get paid more.
0:20:45 Another is I want to shorten my commute time.
0:20:47 Another is I want to advance my career
0:20:48 and I want to get more skills
0:20:50 in a particular specialty area.
0:20:52 And then a fourth one is just I need to relocate
0:20:53 for whatever reason, like,
0:20:55 Stephanie probably had like, what,
0:20:56 two or three of those are valid.
0:20:57 – All of them.
0:20:59 All of the above.
0:21:01 – Advance my career I needed to experience too
0:21:02 and know that.
0:21:04 – So what we’re seeing in the marketplace dynamic is like,
0:21:07 yeah, overall, like the salaries are skewing higher
0:21:11 because well, if you’re an OR nurse in the Bay Area,
0:21:13 for example, or an LA,
0:21:16 every single hospital has that shortage.
0:21:18 So you can, you have the opportunity to optimize.
0:21:20 – And you can leverage that knowledge, right?
0:21:21 – Yeah, exactly.
0:21:21 – That’s incredible.
0:21:24 – And one of the things I’m always interested in
0:21:27 when, you know, talking to entrepreneurs is that leap,
0:21:28 that leap of faith.
0:21:31 What did it take for you to take that leap
0:21:34 from doctor to entrepreneur?
0:21:37 And were there moments where you were a little bit hesitant
0:21:39 or afraid or were you just like,
0:21:41 no, I want to just do this and make this thing happen?
0:21:45 – Yeah, and like dealing with, I’m going to build software.
0:21:46 – So we’re talking about 10 years
0:21:49 from the time I decided to not,
0:21:50 from the time I graduated from medical school
0:21:52 and decided not to do residency
0:21:54 to the time I founded Incredible Health.
0:21:57 So during that time, I had worked in management consulting.
0:22:00 I was exposed to hospital operations and strategy.
0:22:03 I had done my MBA at Wharton on the East Coast.
0:22:07 And then during that time in business schools,
0:22:09 where I was really starting to get more exposed
0:22:10 to entrepreneurs ’cause a lot of my classmates
0:22:13 were founders and CEOs.
0:22:15 And then the other thing is starting a business
0:22:18 is something I’ve always kind of had in the back of my mind
0:22:19 for a very long time.
0:22:21 Both my grandfathers are entrepreneurs.
0:22:23 I’m originally from Sudan.
0:22:27 And so yeah, I got some health hustlers in my family, right?
0:22:30 But I knew I needed to, like all the stars
0:22:33 need to align before you take the dive, right?
0:22:36 So I knew I needed to move to the Bay Area
0:22:37 because this is controversial,
0:22:39 but it still hands down the best place in the world
0:22:40 to build a technology company.
0:22:41 – No question, yeah.
0:22:43 – I needed to have the right co-founder.
0:22:45 When I moved out to the Bay Area,
0:22:47 I didn’t know anything about software.
0:22:49 I didn’t know anything about how to build a product
0:22:51 or ship or anything.
0:22:55 So I actually got, my first job was as a product manager
0:22:57 at an early stage healthcare technology company
0:22:58 in the Bay Area.
0:23:00 And that’s really where I learned to work
0:23:02 with software engineers and designers and data scientists
0:23:05 and what it takes to launch a product and grow a business.
0:23:06 And so after a couple of years of that,
0:23:09 left with one of the lead software engineers,
0:23:12 Rome, who’s my current co-founder, to work on this.
0:23:14 And so like multiple things had to come together
0:23:15 for me to make that decision.
0:23:17 So I needed to have the right co-founder.
0:23:19 I needs to be in the right location.
0:23:21 Honestly, I needed to have enough savings.
0:23:23 And of course I needed to have the right idea
0:23:24 and the right opportunity.
0:23:25 – Right.
0:23:29 Yeah, that’s a really great insight understanding
0:23:30 that you had.
0:23:35 You know, we see a lot of entrepreneurs who have an idea,
0:23:38 but not the skillset to go pursue that idea
0:23:42 and the fact that you recognized, okay.
0:23:44 Not only do I need the skillset,
0:23:45 and you not only got the skillset,
0:23:48 but you got the network to put together the team
0:23:50 to build the company that was gonna work.
0:23:52 That’s really impressive.
0:23:54 – So one of the things that when we started the conversation,
0:23:56 we talked about kind of like origins, right?
0:23:58 So you’re from your family’s from the Sudan
0:24:00 and your family’s from Nigeria.
0:24:02 I just came back from Makaragana.
0:24:06 And one of the things that I loved was just like the hustle
0:24:08 and just seeing people that was like,
0:24:09 no matter what the circumstance were,
0:24:11 they was gonna figure out how to get out there
0:24:12 and make it happen.
0:24:16 How much of that plays a role in where you are today?
0:24:17 And that’s for like both of y’all.
0:24:19 Like how much of that play a role?
0:24:22 – Well, I came from a hustling family.
0:24:26 My dad is a hustler and he brought us up to hustle.
0:24:28 Like you have to take care of yourself
0:24:30 and you have to take care of those around you.
0:24:32 So we always hustle.
0:24:34 And one of the way he taught us how to hustle
0:24:37 is by going to school.
0:24:40 He made sure we go to school and he always tells us,
0:24:42 you do not have to stop at the square cop,
0:24:44 you need the round cap.
0:24:49 So he was always bent on pushing us to advance our career
0:24:52 and do good for yourself.
0:24:54 – Similarly, my family, my Sudanese family
0:24:57 has had similar values in that you gotta pursue education,
0:24:59 you gotta do your best.
0:25:00 No matter what field you go into,
0:25:02 you just need to aim to be the best.
0:25:05 And no matter what it takes, whatever hurdles you face,
0:25:07 like you just have to overcome them.
0:25:10 And that has played out, I’m one of five siblings.
0:25:12 So that has definitely played out
0:25:14 and they’re all thankfully doing great.
0:25:17 You know, a lot of things that get people caught up,
0:25:19 a lot of just listening to your stories,
0:25:20 to have both of your stories,
0:25:23 you know, if something goes wrong
0:25:26 or you get rejected from a job and so forth,
0:25:29 a lot of times people here will interpret that as,
0:25:32 okay, that must have been something like,
0:25:35 you know, that systemically the country
0:25:37 is set up to stop me.
0:25:40 But neither of you had, I mean, whatever that was,
0:25:42 you just dusted it off.
0:25:43 How are you able to do that?
0:25:47 Because it is kind of a cultural outlier.
0:25:49 Yeah, great, that’s a good question.
0:25:51 Okay, so I’ll take the specific example
0:25:53 of raising venture capital.
0:25:56 When you look at the statistics,
0:26:00 it’s proven pretty much that the odds are stacked
0:26:02 against people who look like me, right?
0:26:03 And are your gender.
0:26:06 And yes, my gender and the fact that I’m a minority.
0:26:10 Black women raise 0.01% of the venture capital.
0:26:13 Yeah, that’s zero, that’s approximately zero.
0:26:17 Now, when I’m talking to other CEOs about this,
0:26:19 especially CEOs that look like me,
0:26:21 I’m like, okay, that’s what’s happening behind the scenes
0:26:23 and that’s what the data shows.
0:26:26 But you actually have to ignore that information.
0:26:28 You have to completely ignore it
0:26:30 and pretend it’s like not even there.
0:26:33 It’s a psychological web, right, and a trap.
0:26:38 So when you’re going into, you know, a fancy VC firm
0:26:41 and you walk in that room,
0:26:43 you have to be the way you communicate.
0:26:45 Your assertiveness needs to be the same
0:26:48 as your white male counterpart
0:26:51 that came in the room actually minutes before you probably,
0:26:54 right, and you have to match that level of confidence
0:26:58 and assertiveness in order to get like the term sheet.
0:27:00 So you really collect,
0:27:03 basically you just have to ignore all of that.
0:27:05 It’s still true, you know, like I still acknowledge
0:27:06 that it’s there, but.
0:27:08 But if you get it in your head,
0:27:09 then it’s definitely stopping you.
0:27:10 – Exactly.
0:27:13 – And what I see is that you need like a hundred percent
0:27:17 substance and competence
0:27:19 and then you also need a hundred percent confidence, right?
0:27:22 You need both, both are, both of those are required
0:27:24 if you’re going to do something that’s crazy ambitious
0:27:27 and probably the number one piece of advice
0:27:29 that I do give to minority CEOs is like, yeah,
0:27:31 you’ve got a hundred percent substance,
0:27:35 but like your confidence is only at like 40%.
0:27:37 That’s not, you’re not going to get that far.
0:27:39 You need to, you know, bump that up to a hundred percent.
0:27:42 – How do you teach people to get their confidence
0:27:43 where it needs to be?
0:27:46 Because that’s so easy to fall into that.
0:27:49 Well, they really didn’t understand me.
0:27:50 They really didn’t see me.
0:27:54 They, and like, how do you get people to get in that mindset
0:27:56 where they can cross that chasm?
0:28:00 And, and even racism aside,
0:28:03 just there is like a cultural bridge
0:28:05 that you have to cross getting into like high finance world.
0:28:08 – Yep, this is the hack I used.
0:28:11 I don’t need it anymore, but I used it in the beginning.
0:28:13 It’s very controversial.
0:28:14 (laughing)
0:28:15 – I love controversy.
0:28:16 Say more, say more.
0:28:17 – Let’s go with the controversy.
0:28:19 – So when I was first starting, you know,
0:28:21 raising that seed round or whatever,
0:28:24 I created like an alter ego for myself.
0:28:26 – Ah, all right.
0:28:27 – And the alter ego, okay.
0:28:28 – Who’s the alter ego?
0:28:30 – The alter ego is named Chad.
0:28:31 – That’s a very white name.
0:28:32 – Very. – Right.
0:28:35 – And Chad had a whole persona.
0:28:39 Like Chad was six feet tall, blonde hair, blue eyed.
0:28:42 Last four generations went to the Ivy League,
0:28:46 went to like Phillips Exeter or Hanover for high school.
0:28:46 – Yeah, yeah, I’ve heard of those.
0:28:49 – You know, just like the epitome of American privilege, right?
0:28:51 And when I was like, before I walk into that room,
0:28:55 and by the way, this is any situation where I’m selling
0:28:57 and CEOs have to sell a lot to investors,
0:28:59 to employees, to customers.
0:29:02 I’d be like, okay, for the next 60 minutes,
0:29:04 I’m not gonna be a man with like 30 years of baggage and,
0:29:08 you know, I’m just gonna be Chad for the next 60 minutes.
0:29:10 And you walk in the room and just act, what would,
0:29:12 you know, what would Chad do?
0:29:13 What would Chad say?
0:29:14 – Of course you’re giving me the money.
0:29:15 I’m Chad.
0:29:16 – Yeah, exactly, like Chad walks.
0:29:17 – Do you know where I went to school, bro?
0:29:19 – Exactly, Chad walks into the room,
0:29:23 like not only does he have insane amount of confidence,
0:29:24 like he owns that entire room,
0:29:26 he owns the entire block, right?
0:29:30 And so, you know, now I don’t need,
0:29:32 now Chad and he man have become one, right?
0:29:34 Like I don’t need the alter ego anymore,
0:29:38 but like when I was starting out, like it helped.
0:29:40 – See what’s so amazing is that you said,
0:29:43 I need that, as opposed to, that’s unfair.
0:29:45 – Yeah, I mean, it’s, you know,
0:29:48 I think about my life choices,
0:29:50 I realized most of it was choices.
0:29:52 And like I can choose how I want to show up in the world.
0:29:54 And it’s one of the things that,
0:29:57 like we really connect around, it’s just like,
0:29:59 if you’re an entrepreneur, like you’re an entrepreneur,
0:30:01 it doesn’t matter if you’re a black, white, ex-convict,
0:30:03 whatever, like those are,
0:30:06 that’s like the core of like your driver.
0:30:08 And I mean, I ran into every type of this,
0:30:10 I literally have every built in excuse
0:30:14 you can imagine one human being having, right?
0:30:15 But for me, I always just saw that as like,
0:30:18 how do you just show up in the world?
0:30:19 Like my alter ego is a rapper.
0:30:22 I grew up with hip hop from the beginning, right?
0:30:24 So when you listen to like the Sugar Hill gang,
0:30:27 and they would tell these just fantastical ass stories,
0:30:30 and you know, they probably still sleeping
0:30:31 on their grandma’s couch.
0:30:34 And then that started becoming reality
0:30:38 as rappers began to understand they can, you know,
0:30:41 monetize their skill set in a different way, right?
0:30:44 And so for me, it’s just like in order to get from,
0:30:46 you know, just making a record to like,
0:30:49 turn it into a business and just hustling, you know,
0:30:51 you got to work in different ways.
0:30:53 Like I’m like, okay, that mentality works,
0:30:57 but also they were telling our story.
0:30:58 You know, if you listen to like the rappers
0:31:00 who are hustlers, they’re talking about
0:31:01 the guys in the streets, you know,
0:31:03 but they monetized it in a way
0:31:05 that accelerated beyond the street.
0:31:08 So for me, it was just like tapping into that identity
0:31:10 of like, okay, I’ve done this before.
0:31:12 I’ve done it, but it was all the wrong product.
0:31:13 You know, all the things that come with that.
0:31:16 So for me to walk into a meeting with somebody
0:31:18 and say, hey, I got this idea, you know,
0:31:20 here’s what I’m trying to create or whatever,
0:31:24 like that’s small things to overcome, you know,
0:31:27 but the conversation internally is,
0:31:29 ’cause those voices of doubt never go,
0:31:30 at least for me, they never go away.
0:31:32 So it’s always like, how do I counter it, right?
0:31:33 How do you counter the voice?
0:31:34 It’s like, you’re not good enough
0:31:36 for this is going to stand in your way
0:31:38 or that’s going to stop you.
0:31:39 Sometimes you got to get out of your own head.
0:31:43 You got to get out of how that internal dialogue
0:31:45 can be disruptive when it comes to like
0:31:47 stepping over those bridges and gaps.
0:31:49 And so Stephanie, what’s your alter ego?
0:31:50 (laughing)
0:31:51 Like super-nurse?
0:31:52 – I don’t need an alter ego.
0:31:54 But I don’t have an alter ego.
0:31:57 I just be like, I just bring myself out
0:31:59 and I don’t see the fact that I’m a black woman.
0:32:01 I just see myself as this human being
0:32:03 and I’m just going to have that confidence
0:32:06 and do what I want to do and that’s it.
0:32:10 Because I feel if we stop putting it in our head,
0:32:12 you can’t go where you want to go.
0:32:13 It’s going to come in your way
0:32:15 in being who you want to be.
0:32:18 – So Stephanie, like when you introduce a friend
0:32:21 to the platform, you know, do they believe you?
0:32:22 Are they skeptical?
0:32:23 What do they think?
0:32:25 – I would say they were shocked.
0:32:28 – Yeah, ’cause like four people right now
0:32:31 want to like know more about it and they called me,
0:32:32 I explained it to them and they were like,
0:32:35 wow, they didn’t know such a thing exists
0:32:37 because it’s easy.
0:32:40 Like I have a friend right now that sends an application in
0:32:41 and she has not heard from them.
0:32:43 It just shows still reviewing.
0:32:46 And she applied to four positions to already,
0:32:50 they’ve sent her an automated email saying, no.
0:32:52 But I know that place is short.
0:32:55 So I told her to just fill out the application.
0:32:56 She sent me a link.
0:32:59 She said, I need to refer her or something like that.
0:33:01 So I explained how it works.
0:33:03 I was like, once you fill out the application,
0:33:06 they’ll get back to you and tell you how it works more
0:33:10 and employers will apply to you
0:33:11 and you choose which one you want.
0:33:12 And she was like, oh, wow.
0:33:14 – So it’s interesting that you talked about going
0:33:18 to different hospital websites for the application
0:33:20 because there are other worlds where people are trying
0:33:22 to find employment like LinkedIn
0:33:26 and other social media or other online platforms
0:33:27 where people can apply.
0:33:32 – So LinkedIn and Indeed and even the own hospitals job board,
0:33:34 these are basically job boards, post a job
0:33:37 and then waiting for people to apply.
0:33:40 The issue is that from the hospital standpoint,
0:33:42 it’s quantity over quality.
0:33:43 So there’s a ton of applicants.
0:33:47 But there’s usually a very small in-house recruiting team
0:33:49 that’s sifting through all of that manually.
0:33:51 They don’t have a supportive software or anything.
0:33:54 And so what happens is a lot of people fall
0:33:56 through the cracks, like they’re doing all the screening
0:33:58 and the matching manually.
0:34:01 And because we use our software to do a lot
0:34:03 of that heavy lifting for the recruiter,
0:34:06 the screening piece, the matching piece,
0:34:08 they’re looking at a much smaller group
0:34:10 in order to hire, right?
0:34:12 That’s how we’re able to speed up the process
0:34:15 to less than 30 days and reduce the amount of work
0:34:17 and increase the efficiency by 25 times
0:34:20 for the recruiter compared to using a job board.
0:34:23 – And what about the age of nurses in the field?
0:34:26 Like have they all been consistently responsive
0:34:27 to the technology?
0:34:29 I know sometimes that can be a little bit intimidating
0:34:32 for people who are of a different generation.
0:34:36 Like how is that translated well to across generations?
0:34:37 – Great question.
0:34:40 I think the average number of years of experience
0:34:43 of nurses on our platform is about 12,
0:34:45 but we have everything from one year of experience
0:34:46 to 30 years.
0:34:50 So we have to cater to the entire demographic.
0:34:53 What that means, I mean, that just puts the onus on us
0:34:55 to make sure our software is incredibly easy to use
0:34:57 even if you’re not tech savvy.
0:35:01 So for example, we use a great service called Twilio, right?
0:35:03 For SMS.
0:35:06 We put a lot of emphasis on our iOS and Android apps
0:35:08 because nurses are on their phones.
0:35:10 They don’t really check email.
0:35:12 Many of them don’t even have laptops, right?
0:35:16 So it’s on us to accommodate all the different demographics.
0:35:20 So now that you made the leap and the platform is up
0:35:21 and it’s working and things are happening,
0:35:23 what are some of the biggest lessons learned
0:35:26 that you can look at the before and then after?
0:35:29 What are some of the lessons that you learn?
0:35:30 – That’s so many.
0:35:31 They’re all summarized in your book actually.
0:35:33 (laughing)
0:35:34 – Trauma.
0:35:35 – Yeah.
0:35:37 First one is one I referred to earlier
0:35:40 is just about the importance of confidence and assertiveness.
0:35:44 And that alone just helps you overcome a ton of obstacles.
0:35:49 The second lesson is CEOs to manage your own psychology.
0:35:54 I completely underestimated the mental impact
0:35:58 of starting a business from scratch,
0:36:02 especially one that has a big ambition and vision.
0:36:05 And so what I’ve, you know, I have a therapist
0:36:07 and that’s cool, right?
0:36:11 And I have an executive coach and I surround myself
0:36:13 by other CEOs who are also going through
0:36:15 similar issues.
0:36:18 So really paying attention to my own psychology
0:36:20 has been a really important lesson.
0:36:21 – Very important.
0:36:23 So Stephanie, with that in mind,
0:36:24 kind of like the same question.
0:36:27 Like you talked earlier about having this moment
0:36:29 where you almost quit.
0:36:31 Like what is the biggest lesson you’ve learned
0:36:33 from just forging through?
0:36:36 – Keep going and have the patience.
0:36:37 – Patience.
0:36:37 – Yes.
0:36:40 And I’ll say another lesson I learned was change.
0:36:44 I’m not the type that I don’t like change at all.
0:36:47 So coming to California is a huge change
0:36:49 and I don’t regret doing it.
0:36:52 So I’m always open now to change.
0:36:53 – Some major life lessons in life.
0:36:57 – From Nigeria to Europe to Atlanta to California.
0:36:58 – I mean, I think this is just really,
0:37:00 of all things, it’s incredible to hear.
0:37:04 And I’m always excited just about how they get to spaces
0:37:07 of success and how they overcome obstacles.
0:37:10 So this conversation has been really insightful
0:37:12 and I’m deeply appreciative of y’all being here.
0:37:12 – Yeah.
0:37:13 – Great, thank you.
0:37:14 – That was great conversation.
0:37:17 – I hope, you know, from listening to this episode
0:37:20 that it inspires more people to go into nursing,
0:37:22 especially more men.
0:37:24 So I hope we can get rid of some of the stigma
0:37:25 around nursing that it’s just for women.
0:37:28 Like we definitely need more men in nursing.
0:37:30 – Thank you so much for joining us on this episode
0:37:31 of “Hustling Tech.”
0:37:35 And thank you to our guests, Iman and Stephanie,
0:37:37 so much knowledge of this episode.
0:37:39 If you’re a real hustler, listen to it twice.
0:37:42 (upbeat music)
0:37:45 (upbeat music)
0:37:47 (sighs)
0:37:49 you
0:37:59 [BLANK_AUDIO]

0:00:06 Hi everyone, welcome to the A6NZ podcast. I’m Sonal, and today we’re releasing the next
0:00:13 cycle of Hustlin Tech, a podcast series co-hosted by bestselling authors A6NZ co-founder Ben Horowitz
0:00:20 and Chaka Senghor, a leading voice in criminal justice reform. Each episode is a hustler’s guide
0:00:26 to a new technology platform that creates opportunity for people. We previously released
0:00:31 three episodes in this series last quarter, and this quarter are releasing three new episodes that
0:00:36 follow in this feed over the next few days. These episodes were all recorded right before
0:00:42 the coronavirus pandemic. However, given what’s going on in the world, they touch on many things
0:00:47 that are top of mind right now, from their profession of nursing, including online communities for
0:00:54 nurses and free continuing education from home, to taking care of the elderly, many of whom live
0:01:01 alone or need other in-home assistance, and fighting bureaucracy to get money back or to get help delaying
0:01:07 utility bills and rent payments that are now eligible for an extension or waiver of late fees
0:01:12 due to the coronavirus crisis. You can read more about the what and the why of the entire
0:01:21 Hustlin Tech series and sign up to be notified about future episodes at a6nz.com/hustlintech.
0:01:26 The first episode that follows is the Hustler’s Guide to Nursing Jobs.

0:00:05 Hi, and welcome to the A16Z Podcast Goes Remote. I’m Doss, and in this podcast,
0:00:11 I call A16Z security expert Joel Delegarza to chat about what the rapid, widespread
0:00:16 move to remote work means for security. With so many people going remote the same way that we are,
0:00:22 what’s top of mind for you as a security expert? There is a concept in information security, which
0:00:28 is the belief in defense in depth. And that means that you don’t rely on any one thing to protect
0:00:33 you. You have a series of things that you use, and you stack them on top of each other, and you
0:00:38 use those series of things to offer multiple layers of protection. You don’t just put a moat
0:00:44 around the castle. You also put walls, and you have archers, and you have hot oil ready to pour on
0:00:49 people that try to storm it. And so in security, we have those same sorts of controls. The challenge
0:00:55 for security teams is that a lot of those controls for a lot of companies only live in their office
0:00:59 and only live in their corporate network. And so when users take their machines home with them,
0:01:04 or they’re remotely accessing, they don’t necessarily have the same controls in the office
0:01:09 as they do at home. And if you look at some of the large breaches over the last, let’s say, five
0:01:15 years, you’d see that there are a number of instances where remote employees using a home
0:01:20 computer that’s perhaps shared with someone in the house that doesn’t have protections on it,
0:01:24 is used to access internal corporate information by an attacker that’s hacked it.
0:01:29 Are the things that we’re dealing with new things or just things that are underway happening a lot
0:01:34 faster? We’ve had multiple scenarios in the corporate and enterprise world where we’ve had to
0:01:40 make employees work from home and work remotely. The first real encounter in at least my adult life
0:01:45 with this sort of a scenario was obviously 9/11, when we had fundamentally a city that became
0:01:50 unavailable in the workforce there being mostly unavailable or having to move to disaster recovery
0:01:57 sites. And I think 9/11 really taught a lot of large corporations about the importance of building
0:02:03 really resilient business continuity programs. The actual new thing about this is just the scale,
0:02:07 is just the entirety of a workforce for a company being forced to work remote,
0:02:13 as well as their suppliers, as well as their customers. We had the advent of things like
0:02:19 SaaS and Salesforce and Box and all these tools that were basically derived so that people could
0:02:25 access their work materials anywhere. And that it sort of became expected that some percentage,
0:02:29 usually salespeople because they’re in the field, but some percentage of your workforce would be
0:02:35 remote. And so we’ve been building infrastructure to support that workforce for some time now.
0:02:39 This is less of like, oh, it’s a new way to work and we have to change everything. This is more
0:02:45 like, we have to re-engineer everything to handle the capacity and just the sheer number.
0:02:49 How are the best security teams you know, properly preparing their organizations
0:02:52 with this really rapid shift to remote work?
0:02:58 I think the right way to think about it is to just build a matrix in your mind that sort of
0:03:03 enumerates all the different security controls you have available to you in the workplace,
0:03:08 in the office, and have some understanding of how they translate to the different scenarios
0:03:13 all of your employees will find themselves in now. And so I think there’s two things that the
0:03:17 really good security teams are fundamentally doing. The first is getting their people stood up
0:03:23 online outside of the office because security teams don’t necessarily always have great disaster
0:03:28 recovery and business continuity plans. And then second, making sure that what they’re doing is
0:03:31 actually safe and secure. If you were in an organization right now and say you were going
0:03:39 from 20% to now 90% of your workforce is remote, break down for me very specifically how you would
0:03:44 do a risk assessment. Over the last couple years, most things have left the building. And so most
0:03:50 services are provided by third parties. Most of the infrastructure that you run isn’t running
0:03:55 on your premise. And so for the last three or four years, most CISOs or Chief Information
0:04:00 Security Officer have spent a tremendous amount of time thinking about their third party risk.
0:04:05 Who are their vendors? Who are their counterparties? Who are the people that they transact with?
0:04:10 And you have to think about them not just from a security perspective because that’s
0:04:14 a little bit narrow in terms of impact of the business, but you need to be more comprehensive
0:04:21 and think of terms of like confidentiality. So is shifting all of your voice traffic to this
0:04:25 third party, does that provide you with the confidentiality you need to run your business?
0:04:30 Well, it may be okay to have a sales call with a customer where you don’t discuss anything
0:04:35 confidential over a video conferencing system. Now you’re having your board meetings over this
0:04:39 video conferencing system. Does it meet the requirements that you have? And then you have
0:04:44 to think in terms of integrity. Do the systems that you’re relying on, now that you’ve moved
0:04:50 everybody onto them, have the controls in place to ensure the integrity of the operations of your
0:04:54 business? Are they going to lose your data? Is there going to be some sort of a disruption
0:04:59 to the quality of the output? Are the systems of record truly capable of being systems of record?
0:05:04 And then finally, you have to think in terms of availability. Not just you as a company are
0:05:09 moving your entire workforce to this service provider. The entire planet is, will the service
0:05:15 provider be up and running in the face of this kind of demand? Or will they just fall over because of
0:05:20 the excess utilization? I like the way that you broke that down. So it sounded like the first
0:05:26 bucket there was really around confidentiality and what transactions were happening in person,
0:05:31 providing a measure of security now happening virtually. So let’s focus in on that for a second.
0:05:37 How would you go about assessing that? It really depends on the vertical. And it depends on the
0:05:43 industry. There’s a very, very rich tapestry of requirements and regulations that you have to
0:05:47 really understand. And it’s very specific to the business that you’re in specifically if you’re
0:05:53 regulated. And you have to make sure that the tools that you’re using can support those industry
0:05:59 specific regulations. If you are, for example, in the healthcare industry, and let’s say you’re a
0:06:06 hospital network, and hospitals right now are rushing to provide telemedicine and to remotely
0:06:12 treat potentially sick people, the issue with that is that there are these regulations called HIPAA
0:06:17 and high tech that mean that you actually have to work to maintain the confidentiality of your
0:06:22 patient’s information. So then I guess looking at the second bucket that you talked about,
0:06:26 which was really selecting these new tools and introducing these new third party vendors that
0:06:32 you maybe weren’t using before. So for instance, you and I are using a totally new tool for A16Z
0:06:36 that we rolled out as soon as we went remote so that we could keep running our podcast.
0:06:41 How are you or security professionals thinking about these third party tools and how do you go
0:06:46 about assessing them? Well, it’s always about the data. For example, we’re recording a podcast,
0:06:50 this is public information, eventually it’s going to be released. And so the sensitivity of our
0:06:55 discussion that we’re recording right now is low. It’s fundamentally public data.
0:07:00 Whereas if we were talking about a portfolio company, this might not be an appropriate tool
0:07:06 because it might not adequately protect those discussions. And so we really have to understand
0:07:11 first the sensitivity of the data and then match that data sensitivity to the security features
0:07:17 and capabilities of the tool. Generally, marketing teams are kind of free to experiment with tools
0:07:21 that are maybe not industrial grade security. But the moment that you start talking about
0:07:26 transferring customer records or transferring personal information of your customers or
0:07:31 any intellectual property, then you really need to understand the tools and a very quick adoption
0:07:35 and migration path could potentially get you into a not so great place.
0:07:39 It’s interesting you mentioned quick adoption because that is absolutely what we’re seeing
0:07:44 right now. When you suddenly have, in our case, all of A16Z going remote, we suddenly needed all
0:07:49 these new communication tools that we didn’t use before. So we are rolling them out relatively
0:07:54 quickly. How are IT and security teams keeping up with the fact that people are rapidly adapting to
0:07:59 this, things are changing daily? How do they balance that with security?
0:08:06 At A16Z, we’ve been fortunate in that we’ve probably spent the last two years really focusing
0:08:12 on eliminating any kind of custom solutions, not having servers under people’s desks,
0:08:17 not having servers at all, focusing on using cloud infrastructure and SaaS.
0:08:21 And so when this event happened and we had to pivot credit to our IT team, they did some
0:08:26 wonderful work, but we were really well positioned. There wasn’t a whole lot of stuff other than
0:08:31 adding a few new services that were disruptive. I think the way that the modern enterprise has
0:08:36 built their data stores is somewhat similar so that a lot of the data that a company has that
0:08:41 could very easily flow out of the organization are generally pretty well controlled.
0:08:45 Often we’re used to these large enterprise rollouts of new tools. They take a long time,
0:08:50 but now you have a workforce going remote and you maybe need to roll tools out faster.
0:08:56 What steps are you seeing people cut or needing to add to get the tools out and into the hands of
0:09:03 workers in order to do virtual work? Usually one of the longest pulls on any of these kinds of tool
0:09:09 deployments is the legal and contract negotiations. It’s the kind of thing where the length of your
0:09:12 proof of concept is probably half the length of the debate you’re going to have with the
0:09:17 vendor about limits of liability. Like people complain about IT, but if you really want to
0:09:23 prolong something, bring a couple lawyers. And especially when you have to have IT people,
0:09:28 technical people work with lawyers, it compounds it. So I think where I’ve seen things getting
0:09:33 quicker is just on the procurement side, on the contracting side. We’ve gone through a three-year
0:09:40 process of large enterprises telling employees, don’t use your credit card to buy a SaaS service.
0:09:46 That window seems to have opened up a little bit. And so you’re seeing people paying for things with
0:09:51 personal or corporate cards to get services deployed and unrolled. And I think IT and legal,
0:09:54 they’re going to be flexible. They’re going to keep the business moving. There’s probably going to be a
0:09:59 lot of contract review and a lot of teeth gnashing over the next couple months as they figure out
0:10:05 what they’ve allowed into the enterprise. What in your mind works and doesn’t work to be communicating
0:10:10 out to the organization at this time? And what would you be reiterating to individual workers?
0:10:15 The user tends to be the weakest link in any security system. And so there is this desire to
0:10:20 blame. And then the products that grow out of the desire to blame users tend to be of the variety
0:10:27 that look to shame users into behaving better. So building tests that try to get users to fail
0:10:32 and then highlighting their failure. And we’ve seen more tools that take that approach. They’re
0:10:37 really good at getting the level of compliance up, but only to a certain point. I think the real
0:10:43 key is going to be figuring out how to decadetize employees and users, how to make them feel part
0:10:49 of this, instead of smacking them on the hand for making mistakes. And then that’s really hard for
0:10:53 security people because we do tend to be a bit pessimistic. But building systems that reward
0:10:59 good behavior, I think will go a lot further than the desire to name and shame. From a most
0:11:04 important tips perspective, I think for me, it’s always two-factor authentication. At its most
0:11:12 simplest level, two-factor authentication is the way you log into a system using two factors or two
0:11:18 things. And from a security perspective, you want one of those things to be something you know,
0:11:22 like a password. I’ve got a password and that’s the thing I know. And then the other one of those
0:11:28 things to be something you have, like a hardware security key. And so it becomes very difficult
0:11:33 for an attacker to get access to your system because not only do they have to have your
0:11:38 password, they also have to have access to your key. And so it really frustrates what is ultimately
0:11:44 the single largest source of hacking in the world, which is stealing someone’s username and password.
0:11:49 In general, while using a phone is better than just using a username and password, from our
0:11:54 perspective, it’s not as strong as using a dedicated piece of hardware to protect your login accounts.
0:11:59 So that text message that gives you the code on your phone, probably not as good as some sort of
0:12:03 hardware key you’re plugging into your computer when it comes to two-factor.
0:12:07 Correct. And for systems that you care about, I mean, you should really use a hardware
0:12:13 security key. And if you’re at home and you’re not using strong two-factor on your corporate
0:12:18 resources or even on your personal laptop, then certainly make sure that you enable that. I also
0:12:25 think at home, if you’re not using a corporate-issued laptop or workstation and you’re using your own
0:12:30 equipment to access your workplace, double-click on the security of your own machines, you make
0:12:35 sure that they’ve got usernames and passwords, that you’re running some kind of antivirus software,
0:12:39 that you’re patching your systems. Ideally, you’re not sharing computers.
0:12:44 So you’ve mentioned business continuity planning a couple of times. Explain to me kind of what
0:12:49 that concept means to a security professional. It’s kind of the job of a security professional
0:12:53 and more broadly risk professionals in an organization to sit around thinking about what’s
0:12:58 the worst possible thing that could happen to the business. And so you come out with this
0:13:02 list of things that could potentially disrupt your business. Now, they may be hurricanes,
0:13:07 they could be earthquakes, it could be a hacker attack, it could be a breach, it could be ransomware,
0:13:12 it could be a nation state attack, it could be war, whatever the case may be. You estimate their
0:13:16 risk to the business, like if this happened, how big of an impact would it have? What’s the
0:13:20 probability of a global pandemic happening, for example, or an event that forces all of your
0:13:25 employees to work from home. And a business continuity plan is developed to help manage
0:13:32 those risks so that you can continue to run your business through any sort of adverse changes.
0:13:36 It’s not dissimilar from what a CFO or a financial planner would do where they
0:13:40 try to figure out their risks from a credit perspective, like our credit market’s going to
0:13:46 shut. Do we have market risk? Is our stock price going to fall? Which industries and orgs are having
0:13:51 a harder time with that business continuity and maintaining going remote? And why? What are the
0:13:56 unique challenges if you start to break it down by industry? I think if you break it down by industry,
0:14:01 you’d see that the businesses that are having the biggest challenges are the ones that have never
0:14:07 had a significant disruption. Whereas if you look at banks who were primarily the ones impacted by
0:14:12 9/11, they’ve been able to fairly seamlessly transition to remote work. They’ve been able
0:14:17 to take up different locations and implement their pandemic response plan. There haven’t been
0:14:23 any disruptions to the financial system. We’ve seen people doing panic ATM withdrawals and the ATM
0:14:28 and banking infrastructure doing just fine with it. And if you look at Deutsche Bank on 9/11,
0:14:32 Deutsche Bank invested a bunch of money in business continuity. They could seat their
0:14:37 employees on the other side of the river. They had backups. They were running off-site. In response
0:14:41 to that catastrophe happening, they were able to quickly resume business, settle their trades,
0:14:47 not suffer material financial impacts. I’m sure in every meeting leading up to the event,
0:14:52 there was probably someone saying, “We should cut that budget.” But lo and behold, you hold fast and
0:14:56 it turns out to be an investment that’s worthwhile. I also feel like there’s certain industries where
0:15:01 either regulation or the nature of the critical infrastructure, say a power utility, they have
0:15:06 some unique challenges. I’m curious if that’s something that you’re seeing or hearing about.
0:15:10 I think the power utilities and a lot of these critical infrastructure components,
0:15:15 they sort of have their zombie apocalypse plan. They plan for that and I generally have faith
0:15:19 that they’re doing it well. I think the one industry, the one segment that’s going to be
0:15:24 really impacted and we’re seeing that is actually pharma and healthcare. I think that there are
0:15:30 just major capacity constraints in a lot of countries that just won’t be able to handle a
0:15:36 major flood of inbound requests for care. Ultimately, the reason why we are all
0:15:41 working from home is to protect our healthcare system. Whether we’re conscious of it or not,
0:15:48 we are all engaged in a business continuity plan for the public health system right now.
0:15:53 I mean, that is what working from home is doing so that we can keep capacity available to treat
0:15:58 and care for people. I want to shift now and talk a little bit, not just about the security
0:16:05 practices, but what this means for the architectures that organizations have, because as the workforce
0:16:10 goes more distributed, it does seem like there might be a need to rearchitect the way that we do
0:16:15 things. What are your thoughts on how this might impact organizational architectures?
0:16:20 I think the cleanest example of where there needs to be a massive rearchitecture is when it comes
0:16:28 to traditional VPN or virtual private networking technology. VPNs are mostly based on IPsec,
0:16:34 which is an internet security protocol that was developed many years ago. These protocols and
0:16:38 these infrastructures were designed to be point-to-point. You would have many, many points
0:16:44 around a central hub that would aggregate all of that information and then send it to other
0:16:49 central hubs. In that architecture, if one point on the hub wants to talk to another point,
0:16:55 it has to go through a central point. When you move your entire workforce onto that kind of hub
0:17:01 and spoke point-to-point infrastructure, you get traffic jams. Security systems tend to fail closed.
0:17:09 If a VPN or a firewall starts falling over, they tend to shut down and stop all traffic. It’s
0:17:14 really clear that we have to get away from the centralized, the ring of trust model. We’ve got
0:17:19 to go more towards a web of trust. You’re seeing this with a lot of the new security technology
0:17:23 that’s coming out where they’re creating these more distributed trust environments,
0:17:27 cryptocurrencies, and blockchain are very much about that distributed trust model.
0:17:33 Is it too broad of a generalization to say that the ability for us to scale and to
0:17:39 not be real-time stress testing our systems is really directly related to how fast we can
0:17:46 re-architect to distributed trust? The point-to-point architecture scales fairly linearly,
0:17:51 and so for every increase in capacity or increase in utilization, you have to add
0:17:58 a fixed amount of capacity, and it’s just not a great way to scale from an infrastructure
0:18:03 perspective. And so we have to get to a way where we can use capacity that’s more at the edge
0:18:08 and get away from the centralized infrastructure. You talked about this process of re-architecting,
0:18:13 and I’ve also heard about this concept of shifting to zero trust. Is that the same shift or are those
0:18:19 things different? They kind of cohabitate the same space, and I’d say there’s a lot of overlap,
0:18:25 but zero trust is, it’s an idea that was kicked off, I think, by a forester researcher in the late
0:18:32 ’90s, and the idea was that you have to eliminate transitive trust. Transitive trust is basically
0:18:38 the principle that if I trust you and you trust Bob, then I trust Bob. And as you could imagine,
0:18:42 that is what attackers would use to exfiltrate data, to get access to intellectual property,
0:18:48 to do generally bad things. Transitive trust is a very dangerous thing, and I guess the layman’s
0:18:54 way to say that is, in the old world, if you went to the office and you plugged into the corporate
0:18:58 network, on your corporate network, you had access to a bunch of systems, and a lot of that data
0:19:04 didn’t have passwords or logins or encryption, because it was on the corporate network, and the
0:19:09 corporate network was considered safe. The moment that you got access to the corporate network,
0:19:15 if you were an attacker, you had access to all the data. And so zero trust is about creating
0:19:19 a distributed trust environment. We’re taking away the castle and moat, and every person’s
0:19:25 home is becoming a castle, to reuse that phrase. With the changes that you see underway, with the
0:19:31 shift away from a hub and spoke, how would you advise startups to start thinking about
0:19:35 security and their products? I think that you’re going to see a lot of companies that historically
0:19:41 wouldn’t use bleeding edge technology, actually moving towards adopting a lot of bleeding edge
0:19:47 technology just because of the disruption. And I think it’s a really wonderful opportunity for
0:19:51 entrepreneurs that are making enterprise tech right now. I think this is their time to really
0:19:57 get significant adoption from customers that in the old days would have wanted to see something on
0:20:02 prem, but now you can’t get access to your premises. So you’ve got to try something new.
0:20:07 Generally, we tell our startups, obviously, security is important, but as you get bigger and
0:20:11 larger and later in your fundraising, it becomes more and more important. And then finally,
0:20:17 when you IPO, there are specific public company security requirements that you have to meet before
0:20:22 you even get to go public. So it is a blocker at that level. I think the focus on security is
0:20:28 kind of shifting. I think it’s going to come a lot earlier now. Typically, you’d see series B
0:20:32 companies, sometimes series A companies focusing on security. I think it’s going to be like a seed
0:20:38 stage thing. So as we wrap up, what here is a passing challenge security teams have to meet
0:20:45 and what is just a longer term shift in how we think about security? What’s our new world order?
0:20:50 I think the growing pains are a passing challenge. I think a lot of the large cloud providers and
0:20:54 service providers are going to add capacity. And to be quite honest, a lot of the services I’m
0:21:00 using right now are working fine. So I’m not super concerned about the capacity. I think the
0:21:06 longer term change is just going to be more about keeping the security mentality. I think a lot of
0:21:13 this ultimately comes down to users. And in a workplace where we see each other every day,
0:21:18 you still had people falling for scams where a co-worker sends you a request for money from a
0:21:23 sketchy Gmail account and you send the money. So I think that when you put more of a social
0:21:30 isolation in there, I think the risk of targeting users going for social engineering to defraud
0:21:35 people will potentially become more successful. And so I think the real focus for these organizations
0:21:40 is finding ways to keep employees who are at home in their pajamas, still thinking like foot
0:21:44 soldiers in the battle to protect their company and their data. That’s going to be a real challenge.
0:21:49 And I think training is always proven to be one of the best returns on investment.
0:21:54 That is a terrific note to end on. Joel, thank you so much for joining.
0:21:54 Thank you. My pleasure.

0:00:05 The content here is for informational purposes only, should not be taken as legal business
0:00:10 tax or investment advice or be used to evaluate any investment or security and is not directed
0:00:14 at any investors or potential investors in any A16Z fund.
0:00:17 For more details, please see A16Z.com/disclosures.
0:00:21 Hi, and welcome to the A16Z podcast.
0:00:25 I’m Lauren Murrow, and today we’re talking about the delivery optimized grab-and-go future
0:00:26 of food.
0:00:31 The spike in online ordering and food delivery, a trend that’s particularly relevant now,
0:00:35 is evidence of how tech is fundamentally changing how and what we eat.
0:00:40 In this hallway-style conversation recorded on-site at the A16Z summit, we discuss what’s
0:00:45 driving this transformation, how tech can cut costs both to get food delivered and operate
0:00:50 a restaurant, the infusion of data into the restaurant industry, and what this all means
0:00:52 for the future of dining and cooking.
0:00:57 Joining me and general partner Andrew Chen are guests Ken Chong, CEO of Virtual Kitchen
0:01:02 Co., which is a network of delivery-only kitchens that partners with existing restaurants,
0:01:07 and Kevin Tan, CEO of SnackPass, a food ordering app currently on college campuses in which
0:01:10 customers can order ahead at restaurants and skip the line.
0:01:14 The first voice you’ll hear after mine is Ken of Virtual Kitchen Co., followed by Andrew,
0:01:16 and then Kevin of SnackPass.
0:01:21 We’ve seen a shift in the past five years or so from fine dining establishments to the
0:01:25 kind of fast casual to delivery-only and take-out-only.
0:01:27 What do you think is driving this trend?
0:01:31 Millennials in Gen Z is the generation that grew up with a smartphone, grew up with the
0:01:36 Internet, and with everything at the press of a button on the phone, whether it’s a
0:01:41 car with Uber rides or packages from Amazon, they’re growing up with this behavior and
0:01:45 this convenience and this habit, and I think we’re seeing that demand in food as well.
0:01:51 Yeah, I think if you live in a major city and you’re used to the conveniences of using
0:01:57 tech to enable everything in your life, you’ll almost end up with this baseline expectation
0:02:01 where everything ought to act this way, and over time, the question then becomes, is this
0:02:08 generation who grows up on this level of convenience and choice, once they are 21, 22, 23, they
0:02:13 move to the cities, are they going to give that up and revert back to maybe what their
0:02:17 parents did, or are they just going to expect that, “Yes, I do have a remote control for
0:02:22 food and it’s my phone,” and so for both cities and for college campuses as well, where there’s
0:02:27 so much density, there’s so much choice of different food options around you, that’s
0:02:32 the best possible setting to begin the food delivery trends enabling all of this to happen.
0:02:36 But as they say, the future is here but unevenly distributed, right?
0:02:40 So I think the next thing that will end up happening is a lot of this technology that
0:02:45 ends up working in these highly urban places can then ultimately go to places that are
0:02:50 suburban and rural the same way that a lot of technology ends up spreading.
0:02:54 Consumers love food delivery, they love the convenience of it, and at the volumes we see
0:02:58 and what we’re projecting going forward, it just requires a totally new infrastructure
0:03:03 layer to power that, so we’re building the delivery optimized kitchens of the future.
0:03:07 What Amazon did for retail, we’re hoping to do for local restaurants and on-demand food.
0:03:14 If you are a restaurant or a local food truck, you can sign on and deliver your food region-wide,
0:03:15 nationwide even.
0:03:19 Well, I think a lot of people underestimate the cost of owning an operating restaurant
0:03:24 today, and that’s whether that’s a Michelin star restaurant or a food truck, right?
0:03:28 Traditionally maybe dining restaurants are limited by how many people they can seat per
0:03:33 hour, and then there’s also spikes in which times are rush hours, so they really need to
0:03:37 maximize and squeeze every dollar out of it to cover all their fixed costs, but at least
0:03:41 for pickup and delivery, a lot of restaurants are using that as another revenue stream,
0:03:44 and you don’t have some of the limitations, you can have a kitchen in the back or in the
0:03:48 basement or a virtual kitchen, and so, yeah, it really helps restaurant owners survive
0:03:52 with all these other things that they have to worry about, like rent and labor increasing.
0:03:54 I think Kevin hit on a lot of really good points.
0:03:59 It’s no secret that owning an operating restaurant is really tough as a business, and what we
0:04:06 can do is decouple that upfront investment risk, the real estate build out lease and commitment
0:04:10 that a restaurant tour and a chef has right now before even opening the restaurant, we
0:04:15 can remove that and build it into a platform that allows restaurant tours to come in, experiment,
0:04:21 expand, and move with food trends, consumer trends really quickly with a lot less turnover
0:04:22 overhead.
0:04:27 Because of the digital nature of it, we can change the menus, the concepts in a much more
0:04:30 lightweight way, and not only that, when you look at the whole value chain of where all
0:04:36 the money is, the cost of delivering food, thus, in my mind, the biggest thing that needs
0:04:40 to be solved before this can unlock for people on a daily basis.
0:04:43 And research shows that that is the single biggest barrier that is preventing people
0:04:46 from ordering delivery as it’s cost, correct?
0:04:47 That’s right.
0:04:48 That’s right.
0:04:52 And the industry is moving to an interesting place where the costs are a little bit obfuscated.
0:04:55 You have the delivery fee, you have the service fee, you have the tip, they’re all kind of
0:04:56 separate.
0:04:57 You also have the potentially markup on the food.
0:05:03 As a consumer, how many times have we been ordering food on one of these services, and
0:05:05 everything seems like it should be okay.
0:05:09 And then you look at the bill and somehow you end up with a $60, $70 order, and you’re
0:05:10 like, how did that happen?
0:05:11 Right?
0:05:12 It’s like, yeah, it happens one screen at a time.
0:05:17 So when you add that all together, what that means is it’s very, very hard for the current
0:05:22 conception of food delivery to be something that you can do every single day.
0:05:26 So I think we need a more fundamental solve to that before this can be widely available.
0:05:31 I know both of your companies are largely based on customer analytics and data.
0:05:33 How does that translate for your restaurant partners?
0:05:34 Yeah.
0:05:35 I can use the analogy.
0:05:38 Restaurant owners right now, when you have customers go to the store and order at the
0:05:42 cash register, it’s almost like anonymous web visits, and you don’t know who those users
0:05:43 are.
0:05:47 Like if you have a website and you’re just getting anonymous traffic, whereas on a digital
0:05:51 platform, they can retarget their loyal customers, they can incentivize new customers, and they
0:05:54 can incentivize loyal customers to bring new customers in.
0:05:58 So that is definitely a big part of the play is helping them have that additional customer
0:05:59 relationship layer.
0:06:00 What are you tracking?
0:06:06 So we actually work with the restaurant brands to figure out the best locations to put these
0:06:10 virtual kitchens, what people in those zip codes want, and then we work really close
0:06:15 with them as a very tight feedback loop in terms of ordering behaviors, time of day,
0:06:17 what’s selling, what isn’t.
0:06:21 We’re bringing what e-commerce businesses have had the luxury of in the last decade
0:06:26 in terms of analytics and tracking to that business as well, so a very data driven approach.
0:06:31 Can you give any examples of an instance in which having that data fundamentally changed
0:06:32 away?
0:06:33 An owner operated?
0:06:34 Yeah.
0:06:36 For some restaurants, they’ll have a lot of slow hours.
0:06:40 And so if they want to target customers during those slow hours, right now they can put a
0:06:45 sign on their store or on the sidewalk saying we have a happy hour, but I think with a digital
0:06:48 platform, they’re able to market that even better.
0:06:51 And we’ve recently worked with a really great restaurant partner to figure out what are the
0:06:57 optimal basket size ordering behaviors for delivery and how can they optimize and change
0:07:01 the menu to really, really take advantage of what people want, how they’re ordering
0:07:05 with their friends or with their families, or maybe a dessert with their meal.
0:07:10 I think what that means is as the very, very first e-commerce experiences on the internet
0:07:16 when Amazon were among the first to actually figure out how to use web analytics to present
0:07:20 you the right products and all of that, the restaurants that are able to think through
0:07:24 that and adopt the right tools will be able to hugely, hugely succeed.
0:07:27 And the ones that don’t, I think will remain the restaurant on the corner or maybe not
0:07:28 even exist at all.
0:07:32 So the food industry is obviously a hyper competitive place.
0:07:36 What is it about your companies that makes people want to partner rather than a restaurant
0:07:39 developing their own online mobile ordering app?
0:07:42 So we do partner with a lot of restaurants that have their own apps, but I think they
0:07:45 have trouble getting people to use their apps.
0:07:49 What we bring to them is a bigger customer base that they can tap into and grow their
0:07:51 brand and get incremental revenue.
0:07:53 And you’re growing pretty quickly now.
0:07:54 We’ve been around for two years.
0:08:00 We’re at 11 campuses and we plan on being at 100 campuses in the next 20 months.
0:08:05 And take that playbook that we started at Yale, brought it to Brown, brought it to Berkeley,
0:08:10 and maybe taken a page out of Tinder or Facebook’s campus to campus model.
0:08:14 And Ken, I know there’s a lot of competition in the virtual kitchen space.
0:08:18 A lot of restaurant tours we’ve talked to have considered building their own dark kitchens
0:08:22 and have considered all the options out there, but we’re really focused on building the best
0:08:24 platform for restaurant tours.
0:08:30 And we work really closely with them to help them scale and grow their delivery presence
0:08:31 in the most turnkey way.
0:08:36 What they care about is really how do they bring their food to as many people as possible?
0:08:38 And so that’s been really our focus.
0:08:42 And we make it as easy for the restaurant tour to go from their existing three locations
0:08:46 to four than it is to go from three to Bay Area wide.
0:08:47 I was just going to add that.
0:08:53 I think the proliferation of technology for many of these small restaurants presents huge
0:08:57 opportunities and also there will be also check out and changes in the industry as a
0:08:58 result.
0:09:02 First, I think you can see that if you’re a neighborhood Italian restaurant, if you do
0:09:07 really, really well, if you’re like a beloved local brand, what ends up happening is you
0:09:09 can serve a much, much larger audience, right?
0:09:13 Obviously through food delivery, you end up being able to serve pretty much everyone
0:09:17 in the city versus the people that were maybe in walking distance before would have thought
0:09:18 to drive over to you.
0:09:22 And so on one hand, it really grows the addressable market for any restaurant.
0:09:25 There’s a regionalization to what a restaurant actually can face.
0:09:31 And then on the flip side, it also means that restaurants competition can come from everybody
0:09:32 within the city as well.
0:09:37 When you combine that with the complexities around having every restaurant needing social
0:09:42 media accounts and you got to manage all your Yelp reviews, you have to think about what
0:09:46 is the whole technology stack for how you’re going to do checkout and all this other stuff.
0:09:50 These restaurants that maybe previously didn’t actually need a ton of technology in order
0:09:55 to succeed, all of a sudden need to master this very, very different stack of tools and
0:09:57 applications to be there.
0:10:00 Let’s say your grand vision comes to fruition.
0:10:02 What do you see as the future of restaurants?
0:10:05 Is this the end of the restaurant experience as we know it in some ways?
0:10:10 But it’s also the beginning of basically having every meal become a restaurant experience.
0:10:11 How so?
0:10:15 I think with delivery and with pickup, you can basically turn food into a press of a
0:10:16 button for every meal.
0:10:20 If you’re walking on your way to class or you have a 30-minute lunch break and you don’t
0:10:24 want to wait in line or you want to get pasta for dinner, but you don’t want to sit down
0:10:27 in the restaurant and take an hour to do that.
0:10:30 And I think that’s just going to become a bigger part of people’s eating habits.
0:10:35 I think that in the not too distant future, people will be eating the majority of their
0:10:40 meals either through delivery or pickup, the level of convenience and the ability to give
0:10:45 people back their time and really open up the accessibility to different types of foods,
0:10:48 healthy dietary options is really powerful.
0:10:49 And I think that trend is going to continue.
0:10:50 Yeah.
0:10:55 And I think the other angle we’re approaching is anytime someone’s buying something by themselves,
0:10:58 like single player, we’re going to make that multiplayer.
0:11:01 So right now when you buy something, it’s largely a solo experience.
0:11:05 But on snack pass, every time you buy something, you get to share something with a friend,
0:11:09 whether it’s a discount or a future credit that makes sense for everybody involved.
0:11:14 You, your friend and also the merchant in organic referral.
0:11:18 And because it’s categorically rational, but also extremely fun and has an emotion attached
0:11:22 to it, I think that’s just going to become a really powerful e-commerce trend.
0:11:26 You bring up an interesting point, which is the role of social and all of this.
0:11:30 Can you talk about the growing role of social and where you see that in the food space?
0:11:34 I do think there’s a misconception when we talk about this delivery only model that people
0:11:37 are kind of holing up in their apartments or homes.
0:11:41 And in fact, you’re both telling me it’s about expanding access and making it more social
0:11:43 to eat out or to eat at home.
0:11:44 Yeah, absolutely.
0:11:48 Someone posted a meme on the Yale memes page that was, we don’t say I love you.
0:11:51 We send each other gifts on snack pass.
0:11:55 And the social mechanics we’ve created on the app, give people a way to connect that
0:11:58 isn’t like a text or snap.
0:11:59 Actually food is super social.
0:12:03 And so we found a way to weave that together, social and commerce.
0:12:04 So people are flirting through food.
0:12:05 Yeah.
0:12:11 And your boyfriend or girlfriend, a smoothie, if they’re sick, you can even see who’s sending
0:12:12 gifts to each other.
0:12:16 You can see who’s hooking up with other people by who their gifts are being sent to.
0:12:20 So yeah, it’s like this other social network that you wouldn’t really expect.
0:12:24 And it’s definitely not going to replace a visual feed like Instagram or Facebook, but
0:12:27 it’s augmentation of your social life at college.
0:12:29 It’s kind of like a Venmo of food.
0:12:30 Yeah.
0:12:31 I guess you can say that.
0:12:34 What’s the role of social when it comes to virtual kitchens?
0:12:39 I think hitting at the parallels with retail and how that has gone in the last decade from
0:12:41 brick and mortar to more digital.
0:12:47 You see the opportunity for brands to really experiment and build their presence in a digital
0:12:48 first manner.
0:12:53 We’ve seen a lot of direct to consumer products rise in popularity over Instagram and social
0:12:58 media and really reach and connect with their customers in a very direct way.
0:13:01 You can see the same with restaurant brands and food.
0:13:04 Food trucks have been doing this because they don’t have that permanent brick and mortar
0:13:08 presence, but with virtual kitchens, you’ll see that go even a step further.
0:13:11 So if you don’t have a physical kitchen, are these brands spending more on marketing
0:13:12 than?
0:13:13 Potentially.
0:13:17 It depends on how you view Instagram and Facebook and Twitter.
0:13:23 It’s I think really just a new channel for the brand to create its presence and to reach
0:13:25 their customers in a more direct way.
0:13:30 So when we talk about the future of food, it’s impossible not to talk about robotics, everything
0:13:34 from robot chefs to robot delivery.
0:13:38 What role do you think robots will play in the next five years or so?
0:13:42 We’ve seen some interesting things on the kitchen automation side in terms of robotics,
0:13:47 but I think that is a little bit nascent sidewalk robots and autonomous vehicles, obviously
0:13:48 coming later.
0:13:53 I think we’ll really reduce the cost of fulfillment, the actual delivery piece, which then makes
0:13:55 it even more accessible to more people.
0:14:00 The funny thing about robotics that I’ve seen and let’s use autonomous vehicles as a good
0:14:04 linchpin, I know there was so much excitement about the field just a couple of years ago.
0:14:08 You’d ask people that were just reading the news and you’d say, hey, how long before we
0:14:11 have self-driving cars on the road?
0:14:14 And if you talk to some people, they would tell you five years.
0:14:15 Some people would say six years.
0:14:20 And what I noticed at least was when I started to talk to people that were closer and closer
0:14:24 to the problem, working on self-driving, the number of years that it would take before
0:14:28 it was widely available would increase to the point where the people directly working
0:14:31 on it would be like, I don’t know, it might be a long time.
0:14:36 And so going back to the question on how automation and kitchens will come together, I think first,
0:14:41 as Ken mentioned, there’s a lot around what’s going to happen with delivery.
0:14:45 There’s a number of really interesting companies out there like Starship and Kiwi that are
0:14:50 thinking about that and are thinking about it in a way that hybridizes human teleoperations
0:14:54 in addition to having completely software-based navigation.
0:14:58 And then the other big question that I think is super interesting is in the kitchens themselves,
0:15:03 do you get to a point where you have robots making the burgers and making the pizza and
0:15:04 all that stuff?
0:15:07 Or is this something that humans have to be involved?
0:15:11 And what I’ve seen on the research and the companies that we’ve encountered is that,
0:15:16 yes, that will eventually happen, but each food type is actually very different than
0:15:17 the next one.
0:15:22 Like it is an entire company to just solve automation plus smoothies.
0:15:26 And it’s another whole startup that needs a lot of money to go figure out burgers and
0:15:30 a whole other company that needs to be successful to figure out noodles.
0:15:35 When you look at that in comparison to still being able to have human labor, I think there’s
0:15:40 still quite a gap before we’re going to be able to fully realize that robotics vision.
0:15:43 Andrew, you look at food, gaming, social.
0:15:47 When you look at the food landscape, do you have some vision for the future of food?
0:15:53 So much ink has been spilled about the driverless car, but I think more realistic even is the
0:15:55 idea of the kitchenless home.
0:15:59 And it’s really the notion that if this becomes so convenient and you can have amazing food
0:16:05 that exactly fits your dietary needs for your whole family and it’s at the right price and
0:16:10 it’s in the right packaging, the everyday need for people to actually have a kitchen
0:16:13 in order to do this chore might go away.
0:16:17 And so if you think about that as a general idea and then you say, okay, what actually
0:16:23 needs to happen in the entire flow of the customer experience in order to enable that,
0:16:27 what you end up seeing is a lot of room for really interesting, great companies.
0:16:31 Is this the end of cooking in that everyone is getting everything delivered all the time?
0:16:37 I think what’s going to happen with this combination of delivery and dark kitchens is that one day
0:16:41 somebody who’s gluten free is going to open up the app and they’re going to have dozens
0:16:45 upon dozens of amazing, high quality food available to them.
0:16:50 I’m sure that once all of these platforms like Virtual Kitchen and SnackPass have fully
0:16:57 proliferated, the kinds of chains that we’ll see will not just be burgers and pizza.
0:17:01 Very recently, in fact, over 60% of food delivery was just pizza, just because that was the
0:17:04 thing that would keep you could deliver.
0:17:05 Dominoes.
0:17:08 Dominoes as a stock has performed just as well as the top tech companies.
0:17:13 And so when you start to unlock everything, I think that it will be a golden age for food
0:17:14 entrepreneurs.
0:17:19 The other angle is for those that have dietary restrictions, it can be a huge thing as well
0:17:25 because if you’re gluten free, if you’re keto, if you can’t eat nuts or whatever, it’s not
0:17:28 like you have dozens of choices.
0:17:32 There’s a lot of really, really interesting things that will happen through these platform
0:17:33 shifts.
0:17:37 So is this the end of the traditional restaurant experience as we know it?
0:17:41 The big thing for me is really thinking about the bifurcation of how people are going to
0:17:42 think about food.
0:17:46 There’s the everyday sort of utilitarian view of food.
0:17:51 This is the quick bite that you want for lunch or for dinner on a day where you maybe have
0:17:52 a lot of work to do.
0:17:57 And then there’s also the kind of experiential evenings that you might want out with your
0:18:01 significant other, which is where the presentation of the food matters, the story behind the food
0:18:02 matters.
0:18:08 And so first, how do you up level food overall in all its different capacities and bring
0:18:13 the sort of super high quality ingredients designed by a chef who really cares about
0:18:19 the food to consumers in all forms, and even delivery, even fast casual pickup type experience.
0:18:21 I think that bifurcation is going to be really real.
0:18:25 We’ve seen it in the retail space with showrooms versus ordering online.
0:18:29 And I think it’ll actually be a great world for both sides.
0:18:34 We’ll see great restaurant experiences for Dine-In, and then we’ll have great convenience,
0:18:36 great selection, and great price points for delivery.
0:18:37 Great.
0:18:39 Well, thank you so much for joining us on the 16T Podcast.

0:00:04 The content here is for informational purposes only, should not be taken as legal business
0:00:10 tax or investment advice or be used to evaluate any investment or security and is not directed at
0:00:17 any investors or potential investors in any A16Z fund. For more details, please see a16z.com/disclosures.
0:00:22 Hi, and welcome to the A16Z podcast. I’m Lauren Murrow, and today we’re talking about the rise
0:00:27 of remote work and virtual networking, especially among knowledge workers amid the spread of the
0:00:32 coronavirus. For this quick pulse check, I’m joined, all remotely, of course, by General
0:00:36 Partners Connie Chan and David Yulovitch to talk about the platform’s powering this homebound
0:00:42 workforce, creative new use cases for videoconferencing and streaming from education to therapy,
0:00:47 and whether remote work and online events is the new normal. The conversation begins with Connie,
0:00:52 describing how, for many of these videoconferencing tools, the line between professional and social
0:00:58 use is already blurring. People are trying to use existing and new tools for a variety of things.
0:01:03 I mean, even teenagers who want to interact are using Zoom to hang out with each other.
0:01:08 So I think the use case is very wildly. If you are having a one-on-one conversation and both
0:01:14 people are using Apple products, FaceTime is fantastic. If you are doing a small group setting
0:01:20 where it’s the same repeat users, Zoom might be more relevant. If you are hosting a large event
0:01:24 where a lot of the audience members are trying to look for networking opportunities,
0:01:28 we’re on the world has a solution for that. One platform you mentioned, Zoom,
0:01:33 has really risen through the ranks. It’s the third most popular app in the app store at the
0:01:39 moment. Why do you think Zoom has been so emergent? I think one of the reasons Zoom has sort of broken
0:01:45 out is that they have observed all the friction that all videoconferencing platforms have had in
0:01:49 the past, where it’s hard to get an account. It’s hard to set up. It’s hard to invite people to
0:01:54 people who have less patience these days for products that have too much friction to onboarding.
0:01:58 You know, there’s always sort of the joke of conference calls of like, “Hey, who just joined
0:02:03 the line?” or like, “Who are you?” or “Hey, did you get the right link?” Zoom has fixed almost all of
0:02:08 those usability issues. And I’d say there’s also little moments of user delight, right? I think
0:02:13 virtual backgrounds have been one of the ways that people are breaking the ice or making
0:02:18 conversations more friendly when they’re on Zoom. For those listening, it’s a way that you can
0:02:24 completely obfuscate your background and make it look as if you’re in a green room and put any photo
0:02:29 in the back. And I think people underestimate the amount of technology that’s behind the scenes.
0:02:34 They’re running a global network. They’re carrying hundreds of thousands of minutes of calls at any
0:02:38 given time. They’ve built an infrastructure that’s scaling to a dramatic degree. And that’s really
0:02:44 hard to do. And they’ve spent a lot of time over the last few years as they’ve grown up as a company
0:02:49 to build a reliable, high quality, high fidelity system. That’s why they’ve broken out.
0:02:54 To your point, David, this is new ground as millions of people are flooding these online
0:03:00 platforms. We’ve already seen some outages with tools like Microsoft Team last week. Several
0:03:05 gaming platforms have had outages over the past week or so, including Nintendo Switch and Xbox
0:03:10 and Discord. So there is some trepidation among people that all of us working and learning from
0:03:15 home is straining that underlying infrastructure of the internet. And that’s something that could
0:03:20 particularly impact home networks. What are the limitations of some of these collaboration tools?
0:03:25 Well, first, we all owe a debt of gratitude to the network operators that are running the global
0:03:29 infrastructure. They’re adding capacity that are making sure that the quote unquote the pipes are
0:03:33 not getting too full. That is not an easy job. And these are the people that are working and
0:03:37 they’re probably working from home right now. But they’re working tirelessly. And as somebody
0:03:41 who comes from an infrastructure operations background, I always think it’s good to give a
0:03:44 shout out to those people that are generally thankless until there’s a problem. Right. I think a lot
0:03:49 of people don’t recognize their actual people who are keeping their net running. Totally. And adding
0:03:55 capacity and rerouting things and reprioritizing traffic. We’re all the beneficiaries of that
0:03:59 for all of us who network from home. Broadly, what you end up seeing though is companies that
0:04:04 invest in infrastructure, the ones that know how to scale and have planned for sort of elastic
0:04:08 capacity. And when you’re seeing these platforms, like how teams had an outage and things like that,
0:04:13 these are platforms that have been sort of cut and paste put together over the years from different
0:04:18 products from legacy products. And when you’re building on top of legacy infrastructure or legacy
0:04:23 technology stack, legacy video codex, it’s very hard to then be able to scale up and deliver the
0:04:28 kind of experience people are expecting. So you are seeing new technologies like run the world
0:04:33 and a company called tandem as well. That’s a way to do real time water cooler like conversations
0:04:36 when you’re not doing a scheduled meeting. And companies like zoom that are really taking
0:04:43 advantage of this opportunity. So it’s one thing to have these tools that help us work in small
0:04:50 teams. It’s another thing when these events get at a much larger scale. Many, many conferences,
0:04:55 festivals, sporting events have been canceled in response to the pandemic. What are some of the
0:05:00 promising alternatives you’re seeing to physical events? I think virtual conferences is this brave
0:05:05 new world that we’re all going to start exploring and realize that there’s actually a lot of benefits.
0:05:10 In addition to being able to access it from anywhere from your phone or your laptop and not
0:05:17 needing to pay for travel for hotels for airfare and so forth, there’s also just a lot more engagement
0:05:23 that can happen in an online context that quite frankly is easier in many ways than the offline
0:05:28 in real life version. So think about when you go to a conference and that awkward moment during
0:05:34 cocktail hour and you’re not sure who to approach, you’re not sure how to break into that conversation
0:05:39 or even who you should be meeting with, right? Well, in an online context, now people can be
0:05:44 chatting with other folks but have full context of who they are, why they’re there, who they’re
0:05:50 looking to meet and so forth and platforms can do better matching. So you are making sure every
0:05:55 minute is a good use of time. Look, you always look for silver linings in moment of crisis or
0:06:01 dramatic change and as an introvert, I think this is our golden moment. There’s a lot of people
0:06:05 that don’t get an opportunity to speak up, that don’t have an opportunity to participate
0:06:09 or that the conversation gets steered into a certain direction just because there’s a lot of
0:06:13 voices in a room. There’s somebody who is both often on panels and somebody who’s listening
0:06:19 to people that are on panels. I think panels are like the lowest fidelity form of communication.
0:06:23 I love the idea that in an online conference, you can maybe suggest questions, do a lot more
0:06:28 Q&A, you can help prepare the panel much better and people can better socialize and surface
0:06:31 questions. You don’t just have a moderator trying to decide what’s interesting. There’s
0:06:36 so many opportunities in an online format through all those different communication mediums
0:06:41 to just cultivate and curate a much better experience. The way that you connect with someone
0:06:47 can be through video, it can be through audio, it can be through text and by allowing the various
0:06:52 options, you also attract different types of personalities that otherwise would have been
0:06:56 too intimidated to go to a conference. What’s interesting is when you see a lot of these
0:07:01 conferences switch into an online format, not only do more people join because quite frankly,
0:07:07 the bar to attend is much lower, but more people participate because they’re not so afraid to
0:07:13 chat in an online chat room. The courage required to do that is a lot lower than it is to go speak
0:07:18 to someone in real life. I’m not to mention that it can be recorded and chronicled so that somebody
0:07:22 who maybe can’t make it in real time can go catch up later. There’s an auto chronicling
0:07:27 and auto documenting and archiving capability that is inherent that most conferences just
0:07:31 opt out of because of the cost or complexity. I think that’s really powerful because it means
0:07:36 that especially when you pair it with where we are with automatic transcription, a voice,
0:07:40 it allows people to really consume the information in whatever format works best for them. It makes
0:07:44 it much more accessible to people, whatever prevents them from engaging, not just as an
0:07:49 introvert, but as somebody who also likes to participate sometimes a little bit more voyeuristically
0:07:54 than sort of dive into a full two-day conference session. It’s perfect for people like me and I
0:07:59 think there’s a lot of people out there that feel the same way. So as the coronavirus has spread,
0:08:05 we’ve seen people get creative with ways to keep connected. What other apps are you seeing on the
0:08:10 rise? Are you seeing any particularly creative use cases? Education, I think, is a very big one.
0:08:15 Parents not only need to figure out how to entertain and how to occupy the children,
0:08:19 but they want to make sure that it’s still a good use of time and educational, right?
0:08:25 The V1, of course, is you watch a streaming video of your teacher and you’re basically
0:08:32 watching this person on a screen versus seeing them in real life. But I think the V2 of education
0:08:37 is going to incorporate a lot more different types of media such that the actual course content
0:08:43 could possibly be even better or more engaging. So imagine, for example, an online coding class
0:08:48 that is teaching children how to program, but it’s not just showing you the teacher’s face and
0:08:53 having the teacher talk you through your workbook or through your program, but actually recreating
0:08:59 something that’s half video game, half problem set, and having a teacher talk you through it.
0:09:04 So as you go into these different types of verticals of curriculum, I think the V2 of online
0:09:11 education is going to go beyond just video streaming and be really a mixture of video streaming
0:09:19 plus animation, AR, or really just interactive ways to learn. So I think there will be a lot of
0:09:24 new experiments that happen in distance learning. There are startups out there like OutSchool that
0:09:30 allow all kinds of parents to find teachers who are teaching a variety of courses. And I think
0:09:35 existing teacher-student relationships are going to use things like Zoom or other new platforms
0:09:42 that focus on online education. Now that my own child is at home, I’m seeing that firsthand.
0:09:48 I see my own daughter taking art classes through Zoom, having her piano class through FaceTime.
0:09:53 I know that there’s an artist in San Francisco, Wendy McNaughton, and she’s now been doing these
0:09:58 free drawing classes for kids using Instagram Live. And I think yesterday she did a class and
0:10:03 there were almost a thousand kids that were in this class doing drawing. It’s great for the
0:10:08 parents who need to be working. It lets their kid pay attention to somebody who’s giving instruction
0:10:11 and lets the parent maybe do some work while they’re at home with the kids.
0:10:16 This online format still is very, very effective. Teachers are still able to see what the kids are
0:10:22 doing, give real-time feedback. Another use case I’ve noticed is online tools that facilitate
0:10:27 virtual therapy sessions as well. Right. Yeah, I think there’s a lot of really interesting
0:10:31 use cases. You know, I wouldn’t say I’m a yoga practitioner, but I have many friends who are,
0:10:36 and I probably should be. But one of the things that they lament is that classes spill up.
0:10:40 But now these classes have moved to Zoom and you can do it from home on your yoga mat.
0:10:45 Now the classes never fill up by definition. And so that’s really a transformative shift.
0:10:51 One other interesting trend I’ve seen is third-party video conferencing add-ons.
0:10:57 So apps like Crisp, Crisp with a K, which cancels out background noise like typing or wrappers.
0:11:02 There’s Muzzle, which silences pop-up notifications during screen sharing.
0:11:07 I think I could use both of them. One thing that’s sort of amusing is, you know, I used to work at
0:11:12 Cisco, which has a large collaboration business in Edge WebEx. And so maybe I’m more used to the
0:11:16 always-on video conference call, the constant videoing. But I think for a lot of people,
0:11:20 it’s a new experience and they’re learning all kinds of things. You need to be cognizant of when
0:11:24 your camera’s on. Even if you think your camera’s off, it’s probably on. You need to be much more
0:11:28 aware of whether you’re on mute, whether you’re connected. And there’s a certain sort of video
0:11:33 conferencing hygiene that comes along with that. I’m a big believer in believing the video camera
0:11:37 on. I think it keeps you more engaged and paying attention. Isn’t that one of the features of
0:11:43 Tandem in that it shows which apps you’re on as you’re collaborating with coworkers? Totally.
0:11:47 And they do this in a very privacy-aware way. You can disable it. They show you what application
0:11:52 you’re using and what your coworkers are using. And so what’s cool is I can see, oh, hey, if Connie’s
0:11:57 in a Google Doc, if I have permission to that Google Doc, I can actually see which file it is.
0:12:01 And let’s say I want to collaborate with her. I can just click on it and immediately jump into
0:12:04 that Google Doc. And because Google Doc’s multiplayer by default, we don’t have to
0:12:08 screen share. We don’t have to even have our video on. We’re just collaborating and talking.
0:12:12 It’s sort of like having somebody at the desk next to you and be looking at the same file.
0:12:17 Then if you’re busy, you can jump into a focus mode either permanently or for a period of time. And
0:12:22 so they’re really focused on the usability to create this virtual office environment that’s both
0:12:26 not distracting, but also creates a level of closeness and intimacy with your
0:12:31 coworkers so you can still feel that connection and say, hey, how’s your day going? Or what are you
0:12:36 up to? Or what are you eating for lunch? Right. We’re experimenting using these platforms to even
0:12:41 just hang out with each other, right? Like to David’s point, making sure people don’t feel lonely
0:12:46 during this time of self-quarantine is really important. And so there are teams in our firm,
0:12:50 my own team included, where once or twice a week, we will have an hour set aside where we’re all
0:12:55 online, we’re not allowed to talk about work, and we’re eating lunch together. And that’s funny,
0:13:01 because years ago, I talked about how in China, live streaming for eating was a thing. And everyone
0:13:07 used to make fun of me for that. But we are now doing it here, right? We’re using video platforms
0:13:11 to eat lunch with each other, to hang out with each other. Well, in my team, we’ve been eating
0:13:16 lunch together virtually more than we were when we were actually physically in the office.
0:13:24 It’s actually upping our sociability. So in addition to these online collaboration,
0:13:29 video conferencing tools, some other categories of companies that are seeing somewhat of a bump as
0:13:35 we become increasingly homebound, some of them are obvious, like streaming services, delivery
0:13:40 services, like Instacart. But are there other examples of categories of companies that you’re
0:13:48 seeing more use cases of? Gaming and entertainment is a very big one. Roblox, I can only imagine
0:13:53 how many kids are now wanting to play all the time, because Roblox is not just a one-way game
0:13:56 where you’re playing against a computer, you’re playing with other kids, you’re playing with
0:14:02 your friends. And so for a lot of children, this is their way of maintaining those relationships.
0:14:05 And David, you can speak to that, right? You just installed a Xbox?
0:14:10 I did. I never thought of myself as a gamer. I realized I’m going to be home alone.
0:14:14 I’m up in the mountains. So I bought an Xbox one. I played it a little bit.
0:14:18 I think I still am more of a programmer than a gamer, but I certainly have become a gamer
0:14:24 as a result of this. And whether that endures, I would say work from home, time will tell.
0:14:26 David, have you noticed larger macro trends?
0:14:31 Yeah, there are certainly companies that facilitate more collaboration in terms of
0:14:37 coordination. So whether it’s task management, whether it’s OKR, there’s a whole set of tools
0:14:40 that I think are going to see a lot more usage in the workplace.
0:14:45 It’s things like Asana, where people are using more shared task managers across teams,
0:14:49 instead of just doing their daily huddle, they’re moving some of these team huddles online.
0:14:54 And a company called Workboard aligns goals across teams in a very transparent way.
0:14:57 And they are seeing a lot more interest in people saying, hey, how do I communicate?
0:15:01 What’s important to people? And let them know how we’re doing against our goals.
0:15:05 And so I think there will be a whole trend of applications that create more organizational
0:15:10 transparency so that people understand what they’re working on, why they’re working on it,
0:15:14 and how they’re doing against their goals. And one of the other use cases now that’s really
0:15:19 interesting is telehealth and telemedicine, which is a video conference call with either a nurse
0:15:23 practitioner, a nurse or a doctor. It’s much more efficient. It’s much safer for all the
0:15:28 practitioners and the emergency medical professionals. And I think as a consequence of
0:15:32 all this, the telehealth would become a norm instead of just something that was maybe a little
0:15:36 overpromised and underdelivered. Now I think it’ll become totally mainstream.
0:15:40 Yeah. And I think the common themes you’re seeing here are that when you switch things to this online
0:15:46 digital communication format, not only are they cheaper, they save more time, but they also can,
0:15:51 in many cases, up the quality of care or teaching that you would otherwise receive.
0:15:56 All right. So in the teaching context, when you have one teacher teaching thousands,
0:16:01 you can afford to get one of the most amazing teachers there to create that course.
0:16:07 And same thing, when it’s in medicine, if there are not enough doctors in that particular city,
0:16:13 you now can access doctors from all over the world and unlocking a big supply of service
0:16:18 providers, whether it’s teachers, doctors, therapists and so forth. What it does is it not
0:16:23 only ups the quality of what you can typically access, but it does that simultaneously with
0:16:28 lowering the costs. I want to talk about the longer term impact of this. This is likely not
0:16:34 short-lived. Even before the coronavirus began to spread, our workforce was already becoming
0:16:39 more distributed. So as more and more people are likely to go remote in the coming months
0:16:46 for work, for school, how do you see this pandemic shaping the workforce in the future?
0:16:48 Do you think that remote work will become the new normal?
0:16:54 One thing I would say is certain is that the myth that there are so many jobs that quote-unquote are
0:16:58 not possibly done remote clearly is shattered because people that are doing jobs that when
0:17:02 they were hired into it, they were told that it was not possible to successfully do the job
0:17:07 remote and proven that that’s not true. There’s just a tremendous number of jobs that people can
0:17:14 do remote. It’s an unfortunate but an interesting test case in that, as you noted, most people
0:17:20 probably aren’t that comfortable video conferencing into work. But with this scenario, many are being
0:17:27 forced to, once people realize that these tools are available and that they’re someone intuitive
0:17:31 and easy to use, I wonder if this is the beginning of a more permanent shift.
0:17:34 I think a lot of people like going to an office. They like the separation of
0:17:38 home life and work life. And so there’s a lot of people that will be very happy to go back to the
0:17:42 office. But there’s certainly going to be an enduring trend. I would have to imagine where
0:17:46 people want to live, where they want to live, and then work at the companies they want to work at,
0:17:50 even if those two things are not co-located. And certainly this is showing that that’s very
0:17:53 possible for the vast majority of professional use cases.
0:18:00 Right. It’s still too early to call whether or not consumers prefer working at home or in a physical
0:18:04 office right next to their colleagues. I think distributed teams, especially teams that have
0:18:09 global workforces, are going to realize maybe they don’t have to do all of their hiring in a
0:18:14 very small radius around their office. You know, all three of us are in three separate cities and
0:18:20 three separate rooms all recording this podcast digitally using digital podcasting software
0:18:24 that’s delivered as a service. And so, you know, I think people will find that there’s a tool for
0:18:30 almost every use case that they have. And, you know, I think if I had asked you six months ago,
0:18:34 “Hey, we can start recording podcasts all remote and distributed,” you all would have said, “No,
0:18:38 that’s not going to be good. It’s not going to work out okay.” But of course it’s working out fine.
0:18:44 The other thing I would mention is we don’t know how long this particular phase is going to last.
0:18:48 And as a lot of entrepreneurs are seeing these opportunities, they’re seeing also these gaps
0:18:52 in existing products, I think there’s going to just be more innovation in this space.
0:18:57 Just think about the possibilities when you add things like AR. You know, you can have a fashion
0:19:02 show where things are coming to life or you can look at an item and save it for later, right?
0:19:08 There’s all kinds of things that you can do once you overlay a digital screen in front of a real
0:19:12 life event. So inevitably, I think that means you’re going to get better products serving this
0:19:16 particular use case, too. You know, if you think about video streaming as a new browser,
0:19:20 what are all the extensions you’re going to need? What are all the different destination websites
0:19:24 that are going to have to be built? And I think it’s an open question for some of these verticals,
0:19:29 whether or not it’s a horizontal platform that wins or whether it’s a vertical platform that wins.
0:19:32 Great. Well, thank you so much for joining us on the A16Z podcast.
0:19:33 Thank you.