Winning with Boring Competence, with Ian Crosby

Ep 22

Jan 17, 2024 • 60 min
Ian Crosby, founding CEO of Bench and now Teal, talks building Bench from zero to hundreds, how vertical SaaS is transforming SMB startups, what it really takes to become highly profitable, why Teal hires for “boring competence”, paying highly for top talent, the psychology of firing, and the limits of culture docs.

Allen: Welcome to It Shipped That Way where we talk to product leaders about the lessons they learned helping build great products and teams. I’m Allen Pike and today’s interview is with Ian Crosby. Ian is the CEO and founder of Teal Platforms, and previously co-founded and led Bench Accounting from founding to become the largest small business accounting service in America. Welcome, Ian.

Ian: Thanks.

Allen: I’m excited to have you here and to dig in. We had a good conversation a few weeks ago and within two or three exchanges you said something where it made me think, and that’s always… when somebody says something that makes me think it makes me like ah, I want to talk more about this, I want to dig in.

Ian: I’m glad, yeah. You really hooked onto my words about boring competence. So I’m happy to talk more about it.

Allen: Yeah, I’d never before heard someone say, “I want to hire people for boring competence.” And I immediately wanted to know more about that, to the point that I’m like let’s get that as one of the topics on the show. So before we dig into that and also obviously lessons learned building Bench and now Teal, I want to give you a chance to sort of recap, summarize your story so far as you like to tell us that kind of gets us to have a little bit of context for people listening about who you are and where you’ve been, so to speak.

Ian: I mean, grew up in Vancouver, Canada. First job, I had the first teenager jobs that were very formative, but the first professional job was a bookkeeper and then I graduated university and went to work for Bain & Company as Associate Consultant, and then after two years had this idea about why is there not a better way to get your bookkeeping done as a small business, like how the heck was I your best option as like hiring a business student to do your finances for you. So just convinced two of my best friends to let’s all drop what we’re doing and go work on this thing, which is we’re just going to go and try and solve bookkeeping for small businesses. My first business, I must have been 23, 24 at the time. And then I didn’t think I would spend 10 years working on it but I ended up spending 10 years working on it, growing it from… you know, learning everything. Had never written software before, didn’t really know what SaaS was. And this was 2012 so I guess a lot fewer people know what SaaS was, it’s not like you could even really google it and get a ton. But built that business and then Shopify actually was our biggest distribution partner and I built a great relationship with them and then so when I was done, actually they reached out to me and said, “Hey, would you be interested in running our banking division?” So I said, “Okay. That sounds interesting.” And I’ve never had a real job before other than when I was 22 working as an associate consultant, so let’s go see what that’s about.

Allen: Very different scale and scope now.

Ian: Yeah, and also respected the hell out of Kaz and Toby over at Shopify, so let me soak in whatever I can from them. I’ve never really had a mentor, always been kind of figuring out myself. I went there for just under a year and a half. Started running banking and then took on more stuff, lending, Eaglestone payments, so like app store payments. And when I left I was running the financial services division, so that entire group. So I got a lot of visibility really fast into how that business operated and how financial services operates and all that kind of stuff, but one thing that we really struggled with, one thing that I wish that we could launch was our own accounting, which wasn’t really feasible because there was no infrastructure layer that we could really use. Like, we wanted to launch banking, there’s banking as a service players. You can use Unit, you can use Stripe. There is a way of doing this. If you want to launch lending, there’s lending as a service. If you want to launch cards, there’s… There’s all these things where there’s some hoops you jump through but there’s a way of doing it. If you want to launch your own accounting that’s bundled into the rest of your offering, it’s just not really possible. Like, there were some players but it was really… it was clear that it wasn’t a thing yet. There were like 10 year old companies trying to do it that had never gotten more than 15 employees, like no one had really cracked it like banking had been cracked or lending had been cracked. And I realized, okay, so now we’re at the point where there’s scaled vertical SaaS players. That wasn’t true 10 years ago. Like, Shopify is sort of the front of the pack and you’ve got ServiceTitan and all these sort of businesses that are built around a very particular niche vertical do a great job at having you run your core business. Jobber is actually a great Canadian example, Cleo here in Vancouver. And then you figure out how to monetize that with financial services. So typically it’s payments and then you get deeper and deeper into the stack, banking being the latest thing, lending is huge. And accounting is a pretty big part of that business in a box. It’s noticeable that everyone is taking all of their financial services data, they’re throwing it over to QuickBooks and struggling with doing it, despite the fact that you might be your customers’ credit card, bank, and payments, you still don’t know what the profitability, you still don’t know what the cashflow is, because all of that data’s being interpreted elsewhere.

Allen: And every small business needs that, 100% of them need accounting.

Ian: Yeah, exactly. And to boot, you’re sending it over to a player that their entire revenue roadmap is the same as yours. So like, QuickBooks’ revenue roadmap is also payments and payroll and banking and cards. So you’re helping them build their competing business. So this is a big problem for vertical SaaS at large, now that vertical SaaS sort of is a thing and it’s at the maturity level that it is, these companies need the ability to offer their own accounting suite and it just wasn’t there. So I realized oh, I’m probably the best person in the world to go launch this. You know, I wish I could have been a customer of it so I have my desire for here’s exactly how it would work and here’s what it would offer and here’s how it would work with the other services. And then I also have the experience of here’s how accounting needs to work, building both the software and the service side, and deeply understanding Intuit and QuickBooks and what are the strengths and weaknesses. So I realized there’s a pretty narrow Venn diagram overlap of people with sort of the right combination of experiences to start this company and make it massively successful. So that’s probably the thing I should do. I was actually almost a little sad when I came to that realization. Sad and excited. Excited because I’m like, oh, this is going to be huge. Sad because I’m like, I thought my next company would not be in accounting.

Allen: Right.

Ian: I was like, I’ve spent enough of my life doing accounting stuff, like let’s go on a new advantage. Turns out that all that experience actually made me the perfect person to recognize the opportunity.

Allen: So is the challenge, and it’s come up with a few of the founders we have on the show and talking to them, when they’re thinking through what they’re going to start next there’s always a pull to something totally new and uncertain and like oh, what if I can fix, I don’t know, housing. Some totally new thing that they had no context for. But a really common loop is when you really get into, especially once you’re mid-career, you have a bunch of strengths and skills and knowledge and connections, and to just not use them all is often a pretty big opportunity cost. And so there’s probably something out there that leverages, like we had Dennis Pilarinos on the show and he built something in develop tools and then investigated a bunch of things and then it’s like, what does it make sense to build again? Something not the same but that leverages a bunch of those skills and connections. So a common loop I think many founders go through.

Ian: Yeah, exactly.

Allen: Obviously building Bench from zero to hundreds of employees, the biggest small business accounting company in the US, you’re going to learn a lot. And especially because you started and you’re like 23 and you’d never had a real, real job like that in that industry, obviously there’s lots of things that you learn, but can you think of a big lesson from that time, something that you absolutely would do again or are doing again? And then a lesson that sort of showed you something that you maybe wouldn’t do differently or you’re not going to do the second time around?

Ian: I mean, I spent 10 years at Bench and that was like my formative leadership experience, so there’s just so much stuff there, understanding that all really comes down to people. Like, as soon as you hire two people you are the minority doer of things. You know? You are majority relying on the actions of others, so what are the skills of those people, how are they motivated, what’s the culture of the group? Like, those things become way more important than what you’re going to wake up and do at 9:00 AM. And how you influence that group, how you build that group. So I mean, if you list off a leadership mistake, I’ve probably made it. Hiring the person because it looked like they had the perfect resume, and hiring the person because they had so much potential. You can go to either extreme and they’re both not a good idea. Yeah, learning how to set a culture, learning how to design it. There’s so many sort of shibboleths around company culture that float around the internet. This is terrible, but I spend way too much time on LinkedIn, like getting hammered by thinkfluencers and just going like oh, my god. And then look at the comments like, “Oh my god, 100% this.” And it’s just like, this is all stuff that sounds good and it’s not going to actually work to do it at scale and to make a successful company. A lot of stuff is just people have to be good at their jobs and no one’s writing thinkfluencer posts around like, if you want to have a successful company, everyone should be really competent at the exact thing that they do. And that should actually be probably one of the most important things, like people should just be good at their job, not like we went on this amazing retreat, or there’s all these feel-good things. And it’s like okay, like I’m glad that you feel good, but that’s not… Like, what kind of company are you trying to create? Are you trying to create one where it’s like people just feel good all the time but it doesn’t really accomplish much, or are you trying to really go for it and build something huge? And a lot of people are pretending that they’re trying to build something huge but they’re not, and it’s almost like they don’t know that they’re not.

Allen: When you say that they’re not, you mean they’re not actually building something huge but they feel like they are or that’s the vision that they pitch but it’s all kind of an illusion? Is that what you’re saying?

Ian: I don’t want to speculate as to why. I could talk about why I’ve… I mean, I did the same thing where I’m like, “Here’s how you build a company culture.” And there’s all these posts and I look back at Bench and I’m just like oh, man, some of those things I did, especially in the early years, I’m like please let those fade into history, why does this have to be saved forever on the internet?

Allen: When you say things you did, you mean like a post or some way that you immortalized the way you were thinking at the time about culture?

Ian: Yeah, exactly. And it’s almost like, I don’t know if you think back to high school and some of the things you did and said, and you’re like, I’m glad no one remembers that. And yeah, I definitely feel that way about some of the things I put out there about Bench because we were definitely at some points drinking the startup Kool-Aid. A lot of those things actually blew up in our faces and didn’t work at all.

Allen: You’ve mentioned hiring bad hires, but in terms of like cultural or initiatives to try and… Because you’ve expressed an importance of designing and being thoughtful about the culture you’re building, and then different leaders will make attempts to try and form that culture. It sounds like some of those attempts didn’t get the results that in retrospect you might have wanted.

Ian: Probably the biggest one was just not telling people, “Hey, the number one thing we’re trying to do here is build a successful, profitable business.” And I don’t even want to use the word successful because people hear that work and then they map their own version onto success. I’m like, economically successful, lots of revenue and profits, and a healthy profile of growth. That should actually be really important. And there’s almost like this ooh, like it needs to be bigger than profits thing that goes around the internet. It’s always got to be this big, massive thing. It’s like, well, if it’s not making a massive amount of profit did you actually change anything?

Allen: Well, you could imagine in theory, not to… obviously OpenAI is a weird example of this, but you could imagine creating a nonprofit. Like Wikipedia changed stuff. It’s possible to change things without being massively profitable.

Ian: Well, actually OpenAI, let’s take the example of OpenAI. Does anyone think that Microsoft is not going to make billions upon billions of dollars on their OpenAI investment? Like, that’s a sign that they’re actually doing something in society that is economically valuable, that’s changing something really fast. By the way, I totally get your pushback on this concept by the way, because this is the perception, and I totally was spouting the same thing for a long time, “Profit’s not the most important thing, don’t be so shortsighted.” If you’re really thinking about changing society, it’s like people don’t… if you think about the companies that are most successful, like Stripe, everyone talks in hushed tones about Stripe and the incredible execution. Yeah. And one of the measures of that is think of how much money they’re making. If Stripe was like, “Ah, it’s a cool business but it doesn’t really make that much revenue or profit, but it’s a really cool technology.” People wouldn’t talk about it the same way. People wouldn’t understand it in the same way. Right?

Allen: Is that true? Like, I’ve definitely thought of examples of, there was companies like Uber at its height of impact or maybe not at the height of its impact, but I guess the hype around it as a business. It was unprofitable, had never been profitable, it had a huge impact in terms of it put huge economic impacts on the way that other operators, it’s totally disrupted by any definition of disrupted an entire business, and also changed the way that a lot of people live their day-to-day life. But actually for a while there was a curiosity of like is this even a business that can exist? It may actually not just be unprofitable but unfeasible. It turns out, it seems like maybe it’s turning a corner, it’s like ah actually it is possible to turn that into a business. But it seems like the impact came way before the profit.

Ian: Uber makes billions of dollars in profit. And we can quibble about should they have done it better, but I don’t think either of us would be like, “I could have done Uber better.” Right? And part of the reason that we would respect the hell out of Uber’s execution is because if it went the way of Bird, which also… You know, everyone’s like, “Pfft, Bird. This was foolish. Whoever thought that those scooters would work?” And why we laugh about it, because it’s like, yeah, sure, it had a cultural impact, people talked about it, but it’s not a sustainable business, it grew really fast and then died really fast, and it’s kind of a nothing burger now, right?

Allen: Yeah, and I think that is the thread that resonates more easily with people I find and with me personally, obviously I’m just one person, is that you need to be profitable, at least like nominally profitable to keep existing.

Ian: Yeah, absolutely.

Allen: We can go around and have the company culture that everyone is amazing and we’re all sipping pina coladas as we burn through VC cash, but at some point the company will stop existing unless it is profitable. Now, the difference between massively profitable and nominally profitable, it provides some additional bonuses like maybe we can hire really awesome people or maybe we can… You know, it opens up more opportunities. But that feels like the huge state change when it’s like are we default alive or not?

Ian: Yeah, sure. And that’s very important. Absolutely. That’s a pretty low bar, in my opinion.

Allen: You would think.

Ian: When I’m talking about what does success look like, it’s like let’s talk about Stripe and Uber and those kind of companies. That’s something that we weren’t really talking about at Bench, and I eventually realized oh, you should really hire people who talking about winning is not a dirty word, and what does it really mean to win? Yeah, let’s be ambitious. If you could go build an Amazon, why would you not build an Amazon?

Allen: So Bench got to the point where it was the largest small business accounting platform in America. Is that a win or is that kind of a point of an example of your mindset, it’s like yeah, maybe we built something that was large but if it wasn’t necessarily at some points profitable then what’s the point of it having been built that large? Or is that the path that just took longer to get to because you didn’t have as much of that mindset as maybe you could have at some points?

Ian: I want to love all of my children.

Allen: I’m not trying to trap you here.

Ian: Like, if I had been thinking differently in the early years, Bench could have been way more successful than it is. There’s lots of people who know Bench, talk about Bench and respect Bench, and it’s great being in this small business sphere where like most people have heard about Bench so like oh yeah, Bench is great. But it’s not a Stripe, it’s not a Shopify, and I spent almost as much time building Bench as Toby spent building Shopify, and yet he built a company that’s 1,000, 10,000… however many times bigger. There’s a lot of zeroes there, right? So I get really curious about, interesting. He spent his time doing something that had a different outcome, what are the differences there? That’s actually why I went there to work there, I’m like, what’s the difference?

Allen: How was that experience? Like, a lot of founders go through this loop where they found a company, maybe really early on. Like, you and I both found our first meaningful company in our 20s, early 20s. And then a lot of founders end up on this path where it’s like well okay, what do I do after this? I guess I’m going to found another company. Everyone just kind of assumes okay now you’re serially founding companies and that’s what your resume is, a series of companies you founded or maybe you retire at some point. How did you find that experience of going in and like okay, now you have a boss now, you’re in a large org that you didn’t design?

Ian: One thing I did discover is I’m not compatible with employment. Like, it is really hard for me to have a boss, absolutely. Whether that’s a personality flaw or a learned behavior. If I reflect back actually on my time at Bain & Company, I think I felt the same. That’s why I ended up starting a company. So it’s probably a little more hard coded. I almost wish that I could be happier being an employee because it was an uncomfortable experience, to be totally honest. I think we did a lot of great work, there was a lot to be proud of and I learned a ton, and I respect the hell out of everyone I worked with, but at the same time there’s a reason that I left and it was because I think just being an employee is not for me. Otherwise I’d still be there.

Allen: Yeah. That’s the mindset I hear from, if not a lot… like, probably most of the founders that I talk to is some variant of either I fundamentally know that I am not a good employee or I eventually figured out that that’s just not the way I am set up.

Ian: Yeah, I mean I can’t think of a much better setup than what I had at Shopify, and I still could not really hack it. And honestly, I had this kind of like, how can I honestly be unhappy with my situation? Like, are you kidding me? Like with myself. Because it was going so incredibly well in every dimension and yet I’m like, I have to go do a different thing.

Allen: Yeah. I mean, that’s one of the things fundamentally that most people who are successful struggle with at some point in the middle of their career, is past me would think that I currently have maximal success. Why am I not 100% happy? How can I possibly not just be basking in the glow of this wondrous success? By whatever definition I would have had 10 years ago.

Ian: Yeah, exactly. At the same time I’m super glad I did it. Just having an opportunity to see how someone else has done it, how that company operates, and seeing what a really incredible business model looks like. Like, Shopify, full disclosure, I’m a very happy shareholder and believe in that business. Just the power of it, it’s just so ridiculous. I don’t think people actually realize how Shopify is just starting still and how much further it has to go on so many different dimensions, and just seeing why. Like, what is the secret sauce here and going like, “Oh…” To have a successful product there, once you’re on this vertical SaaS business model, people want to buy things from Shopify. Shopify sellers, they love Shopify so much. Like, “Hey, we’re going to launch banking now.” They’re like, “Great, I’ll use it.” They’re not like, “Hey, here are the 10 reasons why you should leave your bank.” You don’t need to tell that to a Shopify seller. They’re like, “Shopify’s doing it? I’m buying it. Because I assume it’s going to be really well integrated with everything else, it’s going to be really competently designed, there’s going to be great customer service. Quite frankly, I just like Shopify.” You’re going up like a legacy bank, do they feel that about Wells Fargo or a Bank of America or any of these other folks? No. Right? And then you’ve already acquired the customer. Like, this is the magic vertical SaaS, is they’re already using you, you’ve already paid your customer acquisition cost, and then you can just build and launch more and more products that each individually are incredibly profitable; payments, banking, all these kind of things, cards. And you get to acquire all this profit at no marginal cost of acquisition. Versus like a Bench, every time we go get a customer, it’s like hey I’m going to go get a new customer and sell them accounting, and I have this one add-on which is like tax services, and then you’re done. Like, there’s not 10 other things or 100 other things I can sell them because my customers are so spread out across 100 different verticals. Like, we’re too horizontal, right? Versus, if you’re really built around the needs of one business, you can go, “What do ecommerce sellers need?” Or if you’re in home services, “What do roofers need?” Like, let me go stand next to a roofer and see what would make managing his or her business easier. Great business models are one where you don’t have to be a super genius to see how you make a ton of profit. And so, it’s like, there’s almost this translation function of like intelligence and effort into profit, and the great business models are ones that have this very high translation function for the same amount of effort and intelligence, you get this much bigger return. And I realized like, oh my god, like at Bench, it’s like the number three player died, like Skill Factor. Right? It’s like, the translation function is like, there was a ton of intelligence around this business, like I recruited all these really honestly people that were smarter than I had any right to have on my team. Ex-McKenzie, ex-Bain, superstar people, analytical minds, optimizing every part of this bookkeeping factory. And still it was like okay, we are keeping our head not just above water but 5% above water. There’s a return function here, it’s growing, it can keep being sustainable, but like Shopify didn’t feel like we were keeping our heads above water. It felt like everything we did was just like entering into this infinite feedback loop, which is just going to keep on feeding back on itself, and just like being in there looking at all the other leaders doing their stuff, and like oh god, like that’s going to get multiplied by that and that’s going to get multiplied by that. And like, how does this company not grow 100x? You know? Like, oh my god. It’s so obvious to me and I’m not even on the senior team. And there’s probably all the stuff that’s going on in Toby’s head which he hasn’t told anybody because it’s a public company so it’s not like you can share all the super secret plans around. I’m like oh man, this is ridiculous. And also, B, why don’t I just find a blueprint like that? Why don’t I find a really amazing translation function and get it rolling and get it started, with the unfair advantage of I’m also using my 10 years of accumulated experience in the space to find something that can… that’s how you build a multibillion-dollar company. Sure, having more genius to put into that translation function is important, but what’s far more important is the power of the business model itself, that translation function itself. So how do you design that?

Allen: And that goes back to the thing that a lot of VCs will say, is that market matters more than almost anything else. Like, you can have a great team going off into the desert and like-

Ian: Well, this is the thing that VCs understand really well and actually I think entrepreneurs don’t actually understand as well, because usually entrepreneurs, like they haven’t seen it 20 or 50 or 100 times. They’ve seen theirs. So it’s like, it wasn’t until I pulled my head up and started being part of another business and then taking a look at some other businesses and how they run and going, oh, okay. Now I understand why all these VCs were going, “Ah, it’s just not… It’ll be a good business but eh.” And they were right. They were looking for the Stripes, and they should be because that makes sense for their economic model. Now, there’s also stuff the VCs don’t get. Like, I want to give them credit, there’s a lot of smart VCs and they get a lot of stuff a lot better than a lot of entrepreneurs, and there’s also a ton of stuff they don’t get and give terrible advice as a result, but that was one thing where I’m like okay, I can actually… if I understand how this works, now I can much more intentionally design something that will be explosive in its growth and become a huge company. So we’re oriented a little different this time with Teal.

Allen: Yeah. So you’ve sort of made I think a good argument for why taking that into account when you’re thinking about what you want to start or what new product line if you’re an existing business you want to go into is a super high leverage thing to be doing. And then you described vertical SaaS as an example of an economic engine where if you have your customer and you can expand within a very well specified market. Are there any other ways that you think about how to identify something that does have that really efficient function of effort into profit and growth and flywheel? Or do you feel like what your playbook is with Teal, is a different take on that idea of it being vertical SaaS because the SaaS companies that you’re serving are vertical SaaS companies themselves?

Ian: Well, I think having the ability to sort of recognize those kind of business models, it’s very different by the different industry you’re in. So consumer and enterprise are a completely different beast and I know nothing about them, versus like the SMB industry. The winning model in the SMB industry is vertical SaaS. It’s very hard to find an SMB oriented company that’s at any appreciable level of scale that’s not vertical SaaS. Actually originally it was sort of like the accounting companies, like Intuit and why? Because they were kind of the software that you ran your entire business on. That was the original sort of run your whole business software. It’s like I’m invoicing through this, I’m doing all this kind of stuff, and it was not vertical specific and it didn’t have to be because there was nothing before that. It was like pen and paper or like really crappy software. And then this comes along and it’s kind of like the horizontal one size fits all, and then that gets chopped up into 100 different, like everyone… it’s going to die a death of a thousand cuts because everyone can now come along and say, “I’m going to build the best software to run a barbershop, I’m going to run the best software to run a nail salon, I’m going to build the best software to run a legal office.” And they’ll be able to do each of those verticals much better than QuickBooks. QuickBooks can’t fight them all at once and win. It doesn’t matter how big they are, doesn’t matter they have 100 billion market cap. You just can’t. It’s like you’re split too many ways. You have all these individual cultures which live and breathe that exact customer profile. Over the last 15 years, this has been a model that’s been discovered that it works and is repeatable and copy and pastable into all these different industries. So it’s kind of just like this, right now it’s the perfect time, if you want to start a business in SMB what you should do is go find some SMB which doesn’t have a massive vertical SaaS player and just be like, “Can I just sit and watch how you run your business?” And build software for them. This is kind of the time. Like, the 2020s, honestly people won’t talk about it, but this is going to be the decade where a ton of huge vertical SaaS companies get built. There’s a few that have led the charge and developed a formula, and now it’s like literally building a big company in this space is as simple as following a formula and applying it to a new niche. And so we need a lot of entrepreneurs to go do that. And then you think of the second order consequence which is what are all those companies going to want to buy? And that’s where embedded fintech comes in. That’s why, like embedded payments was the first, but financial services is really… typically the best way to actually monetize is vertical SaaS strategy because a lot of the monetization happens in a way that the customer isn’t paying for directly. So if you give someone a card, you’re not paying to use my card, but I get interchange on every purchase. So it’s kind of like invisible. Actually, the way you win in cards is just by having a customer use your card. So why should they use your card, right? And it’s like, well, because it was by the company that you run everything else on. Then you have this massive profit pool. Like, cards are so profitable outside of the customer acquisition cost, and it’s actually kind of true in financial services. There’s just so much profitability and that’s why you see ads for banks fricking everywhere and why BMO and RBC and all these… it’s like, financial services is a really good business to be in.

Allen: And a person with a desk is just literally standing in the airport being like, “Do you want a card? Do you want a card?” Like, that’s very expensive.

Ian: And the only magic is can you convince them to use your card versus a competitor? And vertical SaaS has this magical ability to convince people to use everything with this brand name, this is for you, this is your card, this is your payments platform, this is your banking, this is your lending, and all these reinforcing functions of like I used the payments data to assess whether you’re a good loan profile. So all these things. My loan losses are lower, they’re businesses so they have a better spending profile. So all these things kind of conspire to make vertical SaaS really potentially profitable and financial services is the way to monetize that. You can also charge subscriptions but like typically it’s better to just get people in the door and then monetize them on the financial services because that’s just such a better… like, you pay nothing, here, use my version, use my card, use my bank app. And you pay nothing, you’re like, “Oh my god, it’s free or close to free or 19 bucks or whatever and it has all these things.” And really that’s where I make my money, is on the financial services piece. And then there’s what I was seeing, which seemed plain as day to me, is there’s this big missing piece in the middle to pull all the data together, which is accounting. Which also, A, gives you another layer of insight into these businesses to help you sell financial services products even better, helps them understand their business and helps make them more successful. It’s another thing that increases retention because well, now all my accounting’s here, I’m not going to leave, right? So there’s all these things together that just make this financial services pie even more profitable, like it just amplifies this whole financial services strategy. And it was kind of staring me like plain as day in the face because I understood both sides and been on both the financial services side and the accounting side. That’s where Teal kind of came together.

Allen: Yeah, well it makes a lot of sense. There’s a whole lot of opportunity I see as a… accounting software tends to be non-industry specific and a silo where there’s a bunch of data that is not necessarily… for a small business obviously at a certain scale you have your ERP systems or whatever and then you have dashboards and you’re familiar with all your metrics. But there’s so many small businesses where there’s like, they go into their accounting software and then it’s like ah, they have a P&L that’s maybe set up properly or whatever, but there isn’t a loop from someone the way that there is for, say, Shopify. Shopify understands that vertical, they understand how to run digital commerce so well and they have so much experience and they have so much data and so much knowledge about how to do that well, and they have literally millions of examples of like oh, these businesses failed and these ones did well and we can learn from that, that if they were plugged into something like accounting, then their accounting system that you could be using in Shopify or whatever other vertical or Jane is the one I’m familiar with here, they are doing for medical practitioners, the way that they would look at the finances of their business would have a different valance than the way that somebody who’s doing ecommerce. And if you can pro an experience that even if it’s not that different but it highlights a couple things and it doesn’t have this big question mark here where you’re oh, my clinic has zero dollars of inventory, yes, of course it does because I don’t have inventory because that’s not the kind of business I am, or whatever.

Ian: Yeah. Exactly. Yeah, it just works out of the box. It just feels magical because it’s just like oh, this is for me. Like, that’s when people really influences the buy decision is when someone sees that thing and they’re like, “Oh, that’s for me. Of course I should be using that. That’s the one for me.”

Allen: Yes.

Ian: Right? It influences the antiperspirant I buy, ah, for men. It’s probably the same damn-

Allen: It’s probably exactly the same ingredients.

Ian: But I’m always like, “Oh, I can’t buy the women’s antiperspirant, that’s for women.” It’s like, the only thing that makes it different is the packaging and the branding, right? But you can go further than just the packaging and the branding and actually add in these things that make it differentially better for that segment. Accounting is about to get very, very verticalized, and it’s just starting to happen now with banking. Like, banking, like BaaS… Sorry, banking as a service, not everyone’s in fintech. So it’s this middleware layer where anyone can basically spin up a bank. They’re not actually the bank, there’s a bank in the backend, but you get to be sort of the front door and look like the bank and have your brand on it, but everywhere you have to say the actual banking services are provided by XYZ bank, right? And you have a partnership on the backend. But what we’re seeing now is bank as a service only really became possible in, call it 2020, 2021. Like, it was technically possible for a few years before that but it was just so ridiculously hard and legacy and all these kind of things. But then this new generation of providers came on the scene, really pioneered by this company called Synapse, and I would say mastered by a company called Unit, which again Synapse is the early mover but having a lot of trouble and now Unit, sort of Unit and Stripe Treasury are the ones that everyone’s kind of going to do.

Allen: Right. Stripe Treasury I’ve definitely heard of in that space.

Ian: If you’re going to do SMB banking or SMB cards or something, those are the two providers. And that’s super recent. It’s been around for 18 months and the number of new banks that have spun up and are already… Something like 50% of new small business accounts in the US are neobanks now.

Allen: Really?

Ian: And you’re like, wow, it’s been from 0 to 50% in five years, right? But one thing I think the neobanks are missing is they’re like hey it’s possible, let’s go now to SMBs, boom, and all you had to do was be better than the banks. But I think the next generation after that is the vertical SaaS players that come in and go like, “Yes, an it’s not just SMB, SMB is not targeted enough, it’s roofers, you know? It’s like dentists, nail salons.” There’s no such thing as an SMB. Business owners aren’t like, “I’m an SMB.” My brother installs windows, he’s a window installation contractor, he’s not an SMB.

Allen: I’m a restaurant, I’m whatever.

Ian: Yes, exactly. When someone comes along and offers them banking for restaurants and it has a few of these little add-ins, which is like specifically for restaurants, and by the way the more banking you do the more we’re going to understand if you’re eligible for, I don’t know… I’m not a restaurants guy, right, but whatever specific stuff for them, I’m not sure if they take loans or what. This is the whole point, right? Each of these is so different that the company that’s in that space discovers there’s one or two things that they offer specifically for them that makes it that everyone wants to buy it. So all this stuff is going to get specific. It just started happening with banking. And now everyone’s got all this banking data. What do you do with the banking data? They’re trying to send it over to QuickBooks. That’s really hard and bad. And they’re starting to go, “Well, I’ve got all the banking, why don’t I just do accounting myself?” Well, we’re actually starting to see, and a lot of people that are reaching out to us, are actually banking and card for specific verticals. Like, it’s vertical SaaS that are actually starting with banking, like for a specific vertical and then they go, oh, and one of the things you do is you issue different cards, and hey, what if when you spent on the card, you could spin up cards at will and track different expenses with it and then they’ll just go into your accounting. Like, if I want to track expenses by location for example, okay, just issue that. Location of card, that location of card, that location of card. And then it just shows up out of the box on your accounting. Totally possible in Teal, just out of the box, easy. Right? So it’s like, that’s a lot of what we’re seeing right now in terms of like the culmination of vertical SaaS and banking as a service and now embedded accounting, which we’re offering.

Allen: I love it. I just feel like I’ve just gotten an awesome crash course in vertical SaaS and I’m going to be laying in bed tonight thinking about the impacts of the vertical SaaS revolution. Before we run out of time, I want to get back to this thing we teased at the beginning, which is the idea of how you hire, what do you prioritize? You’re building a company culture, obviously we talked around it by talking about how you’ve learned that you want to prioritize hiring for and you didn’t use these words, but I assume it includes also what you promote and what you encourage in your teams, a mentality of building a business that wins, building a business that’s successful in terms of profitable, not just whatever, every person makes up a different definition of success. And you sort of come up with, I assume it’s your creation, this phrase boring competence, and it’s in your job ads.

Ian: Yeah. Winning with boring competence. Yeah, exactly.

Allen: Winning with boring competence. I want to give you a chance to talk a little bit ab what you mean by especially the boring part of boring competence, because that’s the most sort of novel… obviously it implies that there’s some people out there that maybe have focused on other aspects of maybe what might seem like competence but you have a specific mindset for it. So what does boringly competent company culture look like to you?

Ian: Well, first to give you the contrast to start painting a picture, which is there’s so many people that are sort of novelty seeking when it comes to startups, where it’s like oh, it’s a new thing, it’s exciting, it’s all those kind of things. And I don’t care about jumping from the rooftop and saying we’re the coolest thing, I don’t care about getting status at conferences. Like, that’s all… this is all superfluous. It has nothing to do with what we’re trying to achieve.

Allen: Our whole team does yoga at 10:00 AM every day.

Ian: And look, if you do, great. If you don’t, great. It just doesn’t matter. What matters to us and what we’re going to talk about is winning, and how you do that is just by focusing on winning. So let’s just make it boring, not all this other novel stuff. We’re not going to talk about all the cool new technologies that we’re going to use, implement. Like, look, if there’s a new technology that’s useful, use it. We use GPT-4. But we don’t use GPT-4 because it’s novel. We use it because it’s actually useful for new applications, and we only use it for the things it’s useful for. We’re not like trying to use it for things that it would be silly to use it for. And then putting on our website, like you’ll see, I don’t even know if there’s anything about AI on our website. It just says embedded accounting and it’s all about the benefits the customer gets. It doesn’t even say AI anywhere there, even though there are applications for it.

Allen: That’s the way to actually market. If you build a product with AI then no one cares. What does it do for me, really?

Ian: Yeah, cool. It’s like, oh, you built a product with tires, you know? Okay, is it going to get me somewhere? Is it a car or is it just… Anyway. And there’s a whole lot of people sort of around the technology space that seem to be… I don’t know if they actually want to be part of the exciting business or if they have to put that on because startups say that that’s what they’re doing and we’re looking for people who are so passionate about our mission and they want to change the world by building better dog food or something, right? It’s like, what are you talking about, man? Get real. And maybe the founder really believes that, but I guarantee you that the next 20 employees are just like, “Yeah, we’re all going to say it and it’s kind of weird but cool, I guess I’m into it.” Can we dispense with this level of pretending that people have to do in order to fit into the weird alternate startup culture? Can we just say like, hey, we’re professionals, and we’re trying to create a really big outcome? And if you want to do that, great. If you don’t, great. And let’s authentically look for people who it’s like, is building a really profitable business interesting to you? Yeah, okay, then great, let’s work on it. Like, we can rid of all the ridiculous sort of hustle porn culture, like all the… there’s no bonus points for sleeping on your desk. It’s like, do we ship really high quality code, do we have happy customers? These are the things that matter and none of the other sort of, I don’t know… For some reason right now I have this YouTube video of like Jack Ma on stage doing a dance in front of 10,000 employees at Alibaba, I think it’s Alibaba, right?

Allen: Yeah.

Ian: And it’s like, that’s just so far the opposite, of I don’t want to be doing the moonwalk in front of 10,000 employees. It just seems so kitschy, like what is this weird, almost outer space culture? Can we just be professionals? The outcomes we’re working towards and the work itself are interesting enough without dressing it up. And if that’s not true you should probably question what you’re working on. People aren’t at SpaceX because of the parties. You know? Also we’re not pretending like we’re going to make a bigger difference in the world than SpaceX. Elon Musk is the GOAT. I’m not going to be able to do that and I’m not promising anyone that I’m going to do that and I’m not going to tell anyone we’re going to change the world with accounting. What I am going to do is we’re going to orient ourselves to be really serious about building an incredible business that’s worth billions of dollars.

Allen: Well, I don’t know. You can imagine a branding of that being exciting to some people, right? Building something where you can imagine a different person with the same set of goals that you’re expressing, expressing the idea what are we hiring for is people who are ambitious and driven to grow and make the company grow. I don’t know. Different people may have a different idea of what boring competence is that may or may not… Like, some of the things you described there are not boring, and other people… I’m just being kind of difficult on that, is something about you mentioned sleeping on your desk level and overwork is not part of your vision on that. But a lot of companies, that is the vision. And I feel like that’s a potentially compelling thing when you’re trying to recruit people, like you’re at this scale now maybe, you’re not at the point where you’re trying to get your marginal 100th, or you’re building an exec team and it’s maybe more challenging to get attention of people. But at a certain scale, I think the reason why a lot of companies end up on the path that you maybe were when you were going on a podcast talking about some cultural ideal that you maybe don’t hold anymore, is that they’re trying to get great, talented people at scale. And they want, ideally, to have some prefilter for a type of people who think in a certain way, which is what you’re doing with boring competence, it’s just sort of, I guess, an anti… I don’t want to say anti-authoritarian, but a counterintuitive way.

Ian: Yeah, I guess so. And the last thing is competence. So let me put the last piece in there and then we can talk about all three together, which is people should be really good at their job, and we just have an extremely high bar and no one gets hired without being really extremely good at their job, and I think most companies are not good at doing this. I think most people, most founders try to convince themselves that they’re getting the best talent, and they don’t actually pay very well, and they think that the best talent doesn’t understand what they’re worth, and the best talent can be fooled by you’re changing the world with dog food level sort of, like ridiculousness, when really the best people are just somewhere else. And in fact, you’ve never even met the best people because they’re not attracted to what you’re offering, and you have nothing to measure against. Like, I was very lucky in that I went to Bain & Company as my first job out of university, because that is a company that attracts some of the most incredible talent right out of school. And like a lot of people that were in my starting class at Bain & Company, one is right now the number three or top five people at Uber, for example. Another three are CEOs. This is out of a 10 person group, by the way. Three are CEOs of successful contracts as measured by hundreds of millions of dollars in equity value. So when you’re in a concentrated group of these people just brimming with potential, it feels different. The kind of conversations in that group feel different. Like, the level of conversation, the level of analytical rigor when we were doing cases. I don’t agree with everything that Bain & Company does or how it approaches things, it’s a very different business, but one thing I just have to respect is the competence bar. And that is now always sort of permanently burned in of like that’s what competent looks like and something I can refer to, and quite frankly at Bench, for a lot of the folks I did get this, but then for a lot of positions I didn’t. And it was kind of, there was always this sort of thing in the back of my head around like, I don’t know if these are actually the best people. For some of the roles, for some of people. And I didn’t really take action aggressively to raise that bar, and I don’t even know if actually it’s possible in a business without a ridiculous profit profile to get the best people because we couldn’t pay. Again, I’m having this moment where I’m trying to love all my children because I do respect the hell out of what Bench is all those kind of things, but I have learned a lot and there’s a lot of things I’m going to be doing differently. And one of them is the pay where like, the lowest paid engineer at Teal is paid higher than the highest paid engineer at Bench. You know? So right out of the gate you’re going to get access to a different talent pool because there’s people, they’re really, really good, they’re at, like, AWS or Facebook or Netflix and they want to do something different, they don’t want to be part of a big machine, they do actually really want to do this winning with… There’s something to be like oh yeah, I’m going to be on a small team and we’re going to build something together and that’s going to be great, and I want to bring my skills to the table. But can I really take an 80% pay cut? But if you make that a 40% pay cut with a whole bunch of equity in something that could be a lot, there’s a whole bunch of people that you’re going to get access to that you wouldn’t otherwise. And you can’t get around it. Nor probably should you try to get around it. Super competent people are worth paying more, you know? You pay twice as much and you’ll get someone who can produce 10 times the outcome, so that translation function works. And then if you pack your company full of those kinds of people, like A, everyone looks around and goes, “Oh, this is the bar?” And B, it’s really like, you don’t have to dress it up. It’s just great to work with a group where every single person you look around and you’re like, I feel like I have to up my game because everyone here is so good.

Allen: It’s so powerful working with people who are really excellent at what they do. I had this in my career and I’ve seen it happen to other people, like it’ll shake someone, and their own career will never be the same from working with a group of people that all… not only, like it’s one thing to work with someone who’s really competent which can have a big impact on you, but then working in a group where everyone else is operating just at another level. And then you realize that all this stuff that I was doing before was all just not at my own capacity because I just… it seemed like I was doing better than the examples I had seen, but it was actually really just not… I just wasn’t getting challenged or whatever, you know? And so that’s something I really feel like that’s undervalued I think in a lot of companies, is that idea of the return and the compounding effect of talent and all the things that go into that, competence and also people who care, because sometimes you have people who are nominally competent. In theory they could be doing a good job but for whatever reason either they aren’t motivated by the dog food mission or there’s 100 different reasons, there’s too much bureaucracy, they feel like -

Ian: I’m going to get a real nasty email from dog food company after this.

Allen: Yeah. “We really are changing the world!”

Ian: Yeah. That’s the kind of thing that’s real, it’s visceral, and you can’t dress it up. And this feeling of also everyone’s commenting, and everyone’s professional. There’s not like ridiculousness. You can just have real conversations with people, what are we actually here to do today? Everyone is actually serious about doing their job. And not serious as in stuffy, serious as in yeah, let’s fricking do it, guys.

Allen: Charity Majors, who’s the CTO or maybe CEO or now CTO of Honeycomb. She was on the show, and the term they use for that is, “We’re hire adults.”

Ian: Yeah. And we have a very short, by the way, culture doc. It’s like eight sentences, and it starts with, “Our mission is to build a profitable business and our strategy is to win with boring competence,” and it just talks a few sentences about winning, boring and competence, and that’s it. And it’s like a quarter of a page. It’s remained unchanged for over a year now since I wrote it before we started the company, and I think that we’re probably just leave it, like I hope that five years from now that it’s still the culture doctor. Because usually what I find is the people who are like, “No, you need to add in, like what about this and what about that?” It’s like, yeah, we’re looking for people who don’t need that spelled out for them. You know? Like, you get this and you’re like, oh, cool, that’s it? That’s really it? Great, got it, let’s go.

Allen: The thing that I think starts to happen, I’m sure you see all this very directly at Bench, the motivation as you start to scale is you get some desire for some sense of consistency across an org. Whereas like, you have someone who is a manager of managers that’s hired some group, and then you come across this group and you’re like what is going on with this team? They totally are not upholding. They are, I know, maybe they’re all working eight-hour weeks and that’s not the company culture, maybe they are all half competent but they’ve somehow have gotten away from being noticed, or whatever it is. And you start to end up having more writing and docs and leveling guides and whatever, to the point of like Netflix, which I don’t know how big they were, but when they did their culture doc of like hey… And actually, I think, or I don’t know, tell me if you disagree, but Netflix I think of as a company that does kind of have that hey, we’re all… these are the top performers, we hire the best people, we compensate them well, you’re going to be surrounded with people that are not being bureaucratic and arguing with one another but are actually all working hard to win, and basically sort of boring competence along the way, but they also have for a long time famously had this list of things, of behaviors that they expect. What does competence mean to them? And it means things like actually listening when you get feedback and stuff like that.

Ian: Sure.

Allen: So I don’t know, I’m curious whether or not, maybe we should schedule for five years and see how big Teal has got and how far the doc has grown.

Ian: You know, my counterpoint is Bain & Company where you didn’t need all that stuff, and quite frankly we didn’t really come across… I never came across groups where I was like, how did this person land here? Because writing a longer document doesn’t actually solve that. What solves that is leaders actually making the hard decision of A, these people can’t be here. Like, people that are that good, they’re not going to stand for not doing great work or being on a team that’s just… they’re going to agitate, they’re going to talk to someone, they’re going to cause some kind of difference to be made. And typically if you found that it’s because you made a wrong hire somewhere or wrong hires, more likely. Writing longer docs doesn’t change that, they’re just the wrong people. Writing a doc doesn’t change the people you’ve got at your company. Only hiring and firing does that. I actually have the doc right here, the last two lines, the line around competence is, “Every Teal employee is required to be intelligent, effective and conscientious. We hire people who are and fire people who are not.” And a lot of people read that line, they’re like, “Oh my god, you’re talking about firing in the doc.” It’s like okay, well, what company doesn’t fire people, right? Like, I know a couple and they’re not doing very well. So if you don’t that in your culture doc, then you do it and you don’t tell people about it, you just… Like, this is the reality of our business. You’re just going to kind of sweep it under the rug?

Allen: And that’s something that, like our… At Steamclock we’re a little more fuzzy than that, the way we word it, in terms of… But that idea came to me from Netflix, of like, here’s our culture doc, and it splits it in their culture doc, it’s like, “Your culture doc isn’t very useful or meaningful if it’s not affecting how you hire and fire.” And at the end of the day, ideally you’re doing a good job of hiring and you’re doing a good job of coaching and helping people find their good place so that you’re not just quickly hire, fire, hire fire, fire, fire, fire. Like, there’s other ways of supporting people other than just binary. But if, at the end of the day, not doing these things will not lead to you eventually getting fired then the culture doc is meaningless, then it’s just a wish on the wind, right?

Ian: I don’t think so.

Allen: You don’t think that the culture doc needs to represent how and why you fire people in order for it to be effective?

Ian: We’re looking for people with exceptional competence, and most people are not a very good judge of their own competence.

Allen: Yes.

Ian: So it’s not like I can go around saying, “Don’t be incompetent or you’re going to be fired.” That’s not really up to them. People show up with kind of the skills and behaviors and effectiveness that they have. And sure, you can coach, you can do all these kind of things. But we have a very high bar for when you show up on day one. Like, if someone is not able to perform up to our standard on day one, explaining to them in a culture doc is not going to help. It’s like, we made a hiring mistake, so we’ve got to fix it.

Allen: Yes. And I’m not saying that the culture doc has to provide everyone… in order for the culture doc to be impactful, it has to provide everyone with a map of how to get to conforming to the culture doc, but that if the culture doc says, “We hire people and we retain people based on their competence, and if you’re not competent, intelligent and having an impact,” the way you phrased it, “then you’re going to get fired.” That kind of is underlying. My point was that the doc is communicating how you think about hiring and firing, and as long as you’re actually maintaining that, it may or may not be actionable to a person who’s been hired.

Ian: 100%.

Allen: Warning, you should be competent. And it’s like, I think I’m competent. Oh, it turns out in the regard of the person who hired you you weren’t, and then you’re not going to say. But as long as you’re actually enforcing, as long as you’re actually using hiring and firing with the mindset to this culture that you’re building, you’re going to end up building a culture that’s informed by that, is my point.

Ian: Yeah. And I think some people read that and they hear an implicit threat, “You’re going to get fired,” or something like that, when that’s not what this is at all. This is just like, firing happens at all companies, this is the situation in which we do it. We’re just going to be open about it. And that also sets a tone that when someone is exited from the company, it’s also not a big deal. They’re not a bad person, there’s no untoward thing that went on. We’ve got a ridiculously high bar, most people are not going to meet it, and so it’s kind of normal, yeah. Okay, they’re a great person, didn’t work out, we both thought it would be a fit, we gave it a shot, it didn’t work, and now they’re going to go to something different and they’re going to be just fine, and we’re going to be just fine, and they’re probably a great human being. Like, part of this doctor is actually to reduce that sort of emotional heft of letting people go because too many companies and too many managers keep people around, they’re like, “I know this person is probably not going to work out.” And they keep them for like six months or three months or whatever, like, “Oh I’m going to coach them, I know they’re never going to make the bar, but I’m going to coach them.” It’s like why? You’re wasting company resources, you’re wasting your own emotional resources, they’re not going to be successful here, and you’re dragging out the inevitable for everybody. And I think a lot of it’s just because it’s almost procrastination, around you know it’s going to be a crappy day when you have to let the person go. It’s the least favorite thing that I do in my job is letting people go, and I know I have to do it or else we’re not going to win. But I always have trouble sleeping the night before and I always get all this anxiety before the meeting and like oh, this sucks. And it’s the number one thing that I would put off if I had the opportunity. So part of this is like, it’s okay, you don’t have to go through all that, you’re not a bad manager for letting people go. I don’t envy you but you’ve got to do it. So that’s part of why this is there too.

Allen: And that’s the Netflix idea, like that’s really woven into that doc and talking about, this is not a family, it’s a high performing sports team, and players will come in and we’ll remember them fondly for their contributions, but part of the job is that mechanism. And I think there’s something interesting about this trend, at least it seems to me like a trend from my perspective, of startups doing this, “We only hire senior people.” You didn’t use that phrasing, but you’re talking about compensating people 50% more or maybe even double the median startup salaries to get what you see as the most competent people. Presumably, you’ll have probably a smaller team, or definitely for a given funding level you’ll have a smaller team, but there’s a bunch of benefits we talked about. But one of the things I’ve seen in teams is that there tends to be a much more emotional willingness and ability of people to say, “This is working,” or, “It’s not working.” Right? When you have somebody who’s senior and they’ve done this for 10 or 20 years, they’ve worked at this company where they know what they’re doing and they come in, and if they’re not being effective and you’re paying them $275,000 a year, then it’s like okay, well, it didn’t work. We’re not just going to keep them. Whereas one of the challenges-

Ian: Oh, I really wish I didn’t have to pay this person $400,000 a year when they’re not even delivering $100,000 worth of value, but ah, my mistake, now it’s my cross to bear. You know? Like, no, that doesn’t fly.

Allen: Whereas you get a whole bunch of interns and you’re paying them all, like whatever the legal minimum is.

Ian: Exactly. It’s totally different, right? Like, how could you expect incredible world level performance from a student that you’re paying 20 bucks an hour who’s never done the job before, right?

Allen: And it’s so crushing to a student or somebody who’s in the first couple of years of their career, it’s so much on them if you let them go, and so you have people, whether or not they’re doing it just out of procrastination or really earnestly being like, “Well, I feel like they’re probably not going to work out, but I haven’t done as good of a job as I could have, or we haven’t done as good a job of supporting them. I can think of at least a couple paths where they could pull it through.” And so you end up with way more emotional labor and way more work going into. Obviously the upshot of that is sometimes you get exceptional people who had a lot of potential and then they work out, but it has a cost.

Ian: Yeah. I mean, building a company, designing a company culture is like designing a plane. Like, there’s no one right kind of plane, but you better make sure all the parts fricking fit together or you’re going down. Right? You can build a jetliner, you can build a Cessna, you can build a glider. There’s so many different potential designs and they should be fit for purpose. Like, the kind of company culture we’re building is not a fit for a corner store or a small business. We’re very intentionally going, this is the design of a business that is going to be a multibillion dollar software business, it’s very intentionally designed from business model up, from every single individual, from the venture capital board, like all these things very meticulously fit together in a particular way. And if you sort of change one part out, it wouldn’t work. Again, there’s no one right or wrong culture, it’s just sort of like what mission are you going on? What does this plane need to do? How far does it need to fly? How much fuel does it need to hold? How many people need to be on board? How fast do you need to get there? So that’s, I guess, the overall point on culture, where what I see most people doing is taking accepted wisdom, not really understanding aerodynamics when they’re designing the plane, and just sort of copy-pasting designs from different CAD files and being like-

Allen: “I like this one and I like this one, and I heard this sounds nice.”

Ian: Oh and one of the things that you have to do in every culture is profess complete confidence in the culture, so now I’m also not able to admit that it’s wrong, you know? It’s no wonder that so many of these cultures are dumpster fires, right? But it’s also like, people doing the best they can and they haven’t even figured out the idea that maybe you should intentionally design this to understand how the parts fit together a little better. Whether venture capital is right or wrong, again, jet fuel is great if you’re building a jet. It’s not great if you’re not building a jet. That’s going to probably be very volatile and blow things up. So it’s not VC’s fault. It’s not the fault of the jet fuel salesman, right? Like, don’t blame the jet fuel salesman if the jet fuel blows up because you didn’t have the right machine for it to go into.

Allen: Don’t put jet fuel into your restaurant.

Ian: Yeah, exactly. That’s probably going to be a bad outcome.

Allen: Awesome. Well, this has been a lot of fun and I’ve enjoyed talking this stuff through and I also appreciate you letting me challenge you because I feel like it’s then turned into more interesting-

Ian: That makes it way more fun, yeah.

Allen: So this has been great. How can people go to find out more about you and your-

Ian: Our site is teal.dev. You can also find me on LinkedIn, again, my name’s Ian Crosby of Teal. That’s probably enough to have my pop up on LinkedIn. Really great to be on the podcast. Appreciate you having me.

Allen: Awesome. Well, I appreciate you taking the time. It Shipped That Way is brought to you by Steamclock Software. If you’re a growing business and your customers need a really nice mobile app, get in touch with Steamclock. That’s it for today. You can give us feedback, follow us on social media, or rate the show by going to itshipped.fm/contact. We’ll also have the show notes and the links that Ian mentioned here on the show on there. Until next time, keep shipping.

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