Acquired - The Rover-DogVacay Merger (with Rover CEO Aaron Easterly)

0:00You know, and I've experienced dog zinstats that they shouldn't. The dog's jumping over fences. You didn't think it would be possible for them to jump over. Welcome to season two, episode nine of Acquired, the podcast about technology, acquisitions, and IPOs. I'm Ben Gilbert. I'm David Rosenthal. And we are your hosts. Today, we are talking about a very important company. Without this company existing, there would be no Acquired. And it's likely that David and I never would have met.

0:37Today's episode is about Rover.com and their merger with dog vacay to consolidate the grand rivals of the dog sitting wars. And we're super fortunate to have with us today the founder and CEO of Rover.com, Aaron Easterly. Well, thanks for having me. Glad to be here. Yeah, we're super pumped. So Aaron, this is the part where we introduced the guest. And I was going to do it from memory, but I wanted to make sure that I nailed the details.

1:01So I tried to find a bio for you online, which is harder than most folks. You're not exactly a bio person. I spent exactly zero minutes managing my reputation as we'll become clear throughout the show. The one I did manage to find is from CrunchBase, and Lissu has a rover's top dog. So a rover's big on puns, and we'll revisit that many times throughout the episode. But listeners, to give you a sense of a variance background, He was an entrepreneur in residence at Medrona Venture Group during the genesis information of Rover and as a key part of that. And Aaron was the, before that, the general manager of network strategy and monetization within Microsoft's advertiser.

1:41publisher solutions group. Now, Aaron, there are many rumors circulating that you were the youngest GM ever in the history of Microsoft at age 29. Can you confirm? Actually, I can't. I don't know if that's true or not. I was a very young GM for Microsoft at the time, and there's no one that's younger than I'm aware of, but I don't know if that's true. And Aaron, of course, came into Microsoft through the acquisition of a quantum avenue A atlas, and it was a huge ad tech acquisition of that era.

2:11So to start the show the most important thing though, which is that do your whole life Aaron has been a lover of dogs and homerunians one dog particular more than anything else. Yeah, I love all animals But I'm very partial to dogs and I was owned for 14 years by a four pound fluff ball named Caramel And we are sitting here in the Rover office in Caramel's den named for Caramel with a portrait of Caramel up above Erin on the wall here. Very sweet. All right, listeners. Now is a great time to talk about a new partner of ours here on Acquired, LaGoura, the agentic operating system that is redefining how the world's best legal teams work.

2:56Yup, it's sort of obvious that AI is going to completely change the legal industry. I bet most of you listening have dropped a contract into some sort of AI chatbot out there. LaGora took that insight and asked the question, what if you really built something with that power from the ground up for the legal industry? So the founders did exactly what great founders do, operate with obsessive customer focus. They embedded inside a massive law firm for months. They sat with the lawyers just watching how the work really gets done. And that's how you get features that customers love, like tabular review, where you drop in a folder of hundreds of contracts, and it pulls every key term into a grid a lawyer can actually work with. Lagores Bed here is interesting. Since it lets each lawyer handle more complexity, any given person can increase the quality of their work and do higher value work. And this means that the pie can grow even as each individual task takes less time.

3:52And they recently launched LaGora agent offering greater intelligence and performance. The agent lets lawyers set an objective. Then it can handle the planning and the execution and delivery of the final product. Legal teams get to maintain full control and transparency since they're still involved where judgment is required. And LaGora works where you already work. You can use it within Microsoft Word while redlining or drafting. The early LaGora numbers essentially speak for themselves. When they have a head-to-head pilot with their top competitor, they win 70% of the time. Legora now has over 100,000 lawyers on the platform from 1200 legal teams in 50 countries. And crazily, they went from 1 million to 100 million in ARR in about 18 months. Truly insane numbers. And that is the real test.

4:44Plenty of things demo well, but the question is whether a busy associate actually reaches for it during crunch time or whether a partner trusts it before going into a conversation with a major client. If your legal team wants to check it out, whether you're a law firm or you're in house at a company, you can learn more at logora.com slash acquired and just tell them that Ben and David sent you. All right, David. All the hard stuff is out of the way. Now for the fun stuff. Yeah. It's really fun to have Aaron with us because Not only is Aaron a great friend of all of ours, and we spend lots of time together, but literally this story is the story of, you know, why we're all here today. As Ben said, I don't think we would have met without it. Certainly there would be no wave, no PSL, none of it. It all comes from the top dog. So thanks, Aaron. Yeah. To set the stage on the Rover Origin story and we'll Aaron will come in here.

5:40throughout, but there are really three pieces that I want to dive into. And so first setting the background, let's go back to summer 2011 here in Seattle, summer time in Seattle, which is the best time in Seattle, where we're just entering into it again here now. There's a company based here, high growth, high flying company, goes by the name of Amazon, which we've covered on this show before. And the stock price is at astronomical Heights all time high all time high $200 a share and people are wondering can this go on can this hype continue things are going so well the company which had here before had just one office had an old hospital building up on Beacon Hill they've actually Purchased from Paul Allen and started constructing a brand new campus in South Lake Union Wait in 2011 Amazon was still in Pac-Med Yep, my god beginning of 2011 change Amazon is still on Beacon Hill

6:38Wow. And listen, it's a crazy story about that building. It's a little dovetail, but that was a hospital that Amazon converted into their first large major office before effectively colonizing all of downtown Seattle now. And it is now back to a hospital. Totally crazy. But people are wondering, you know, what's going on? They're starting to construct these new buildings. They've just constructed their new headquarters in South Lake Union here in Seattle. We're going to come back to that. And as part of that, it's sort of the tech and venture funding Thaw after the financial crisis is starting to thaw optimism is returning to the tech world and to Seattle. And there's this other interesting thing happening in the world right now, which is this concept called the sharing economy is taking off. For me personally, I had just moved to Seattle the fall before in September of 2010 to take a job at Moderna. And I had for the first time stayed in an Airbnb in September of 2010.

7:35And I knew about it because my then girlfriend now wife Jenny, her best friend had just started dating one of the early employees at Airbnb. Now my partner Riley at Wave. And so I heard about Airbnb is where I stayed when I moved here to Seattle. So this is all percolating. They'd raised a seed round from Sequoia. And at the same time here in Seattle, there is an organization called Startup Weekend.

7:57And startup weekend was really cool. Then you were part of it in the early days, right? Yeah, still is very cool. It's an organization that started as a non-profit and is now part of tech stars that basically gets a bunch of people in a room. Most of them having never been involved in stars before, certainly having never founded them before. And it's...

8:14people pitching ideas and trying to create companies in 48 hours. So you bring together designers, developers, business people, because we never had a better name for business people than business people. And you basically try and come up with a pitchable concept that has evidence of traction or belief it will succeed by the Sunday night. And chief among the useless business people.

8:36is our partner at Madrona and Greg goddessmen. Now, of course, Greg was also on the board of startup weekend. I was instrumental in and building out that organization, but also happened to be an idea person. An idea person for sure. And so all of us, the weekend of June 10th here in Seattle, we decamp to Amazon's new campus here in South Lake Union for a startup weekend hosted by Amazon. Greg and I are participating.

9:03Aaron, I can't remember. Were you there? You showed up at one point during the weekend. No, I actually got a call from Greg during the week and back. He didn't show up during the weekend. My girlfriend at the time was there, but I wasn't. We did a phone a friend. There. The way startup weekends work is that on Friday night, anybody who attends can pitch an idea. And so of course all the useless business people pitch ideas. And I remember Greg about to go up on stage to pitch his ideas and he's debating between two ideas.

9:30I don't remember what the second one was. I was trying to find it. There's another $970 million company lurking in that second idea. Maybe even bigger. What could have been? But one of the ideas is Airbnb for dogs. And he asked me, which one do you think we should do? And I said, well, I think there's actually something to this Airbnb thing. I mean, my buddy down there is working there like they're doing pretty well. I stayed at one. It's really cool. Okay.

9:59We'll do Airbnb for dogs. Wow. David, you should be a venture investor. Yeah. And Airbnb for dogs. It was Greg pitches the idea recruits a team led by all star developer and in his own words, quote unquote, studly college student. The one and only Phil Kimmy home for the summer who was participating in the startup weekend. I believe the direction from from Greg during the weekend to Phil heading the development team was go to Airbnb.com.

10:29clone everything on the site and replace it with dogs. It should be noted that after the startup weekend, we ended up throwing out everything that was built because it was completely shoddy, but Phil ended up rebuilding it as we shall see. The company called a place for Rover ends up winning startup weekend. It was a little stacked because the judging panel on the judging panel was Matt McElwain, one of our other partners at Madrid.

10:59That aside, Rover ends up winning the start-up weekend. Monday comes around. We're in the Monday meeting at Moderna, and Aaron, of course, is an entrepreneur in residence with us at the time at Moderna. We're discussing the weekend and how things went, and everybody's pretty excited about this idea. So excited that we call up Phil the...

11:20Phil Kimmy, the studly college student who had built things over the weekend and say, hey, can you come on down? And we want to talk about this a little more and maybe turning this into a real company. God bless everybody at Madrona who had the confidence in all of us to do this crazy idea because this was before we were a venture firm, venture firms didn't start companies. And with all of us there, we started going on that Monday, June 13th. So Aaron, as we mentioned, was an entrepreneur in residence with us at Madrona and you were working on some new marketplace ideas, right? Because you had been obviously a marketplace expert being an Aquanove and then a Microsoft. I was trying to remember, what were you working on? It was like a local commerce idea, right? Well, there's a couple different marketplace ideas I had around advertising and small businesses as well, but mostly on customer acquisition schemes and marketing things for those types of companies.

12:12of which I should add, I was totally not excited about. You know, I love the digital advertising world. I found it fascinating, the comments to me, I had a lot of fun with building some of the early online marketplaces, but you know, after being in it for over a decade, I was having a really tough time getting passionate about throwing myself into another digital marketing startup. Am I remembering right was there something to bite?

12:37people in your family had worked in local businesses and had trouble with customer acquisition that you were going to support them with. My parents had actually decided to open a pizza and wine bar. In California, right? In California. You know, the challenges of people who open businesses like that actually being able to devote cycles to doing marking effectively.

13:00It's a big prop. They're typically working in the business, not on the business. They don't spend a lot of time thinking around how to make that efficient. So that Monday meeting happens and you guys are kind of discussing, hey, this thing happened over the weekend at startup weekend. We couldn't get Aaron to come in despite the fact that he's this world-class marketplace expert and economist. He wouldn't drag himself over to South Lake Union, but here we are Monday and we're all looking at each other going, we think we should do this. What does the process look like from there? So Greg dragged me to meet with some of the engineers that were on the team over the weekend that he wanted us to help evaluate and whether or not he

13:38invite them on to kick off a prototype program. And so day one, I was happy to advise and consult on the project. Well Greg didn't know at the time though was actually a dog net and that I had experienced this problem myself.

13:54for the better part of 12 years, being a single, busy business executive with a dog, I absolutely adored, but would not take with me on business trips. So it's a problem that I had like all the time in my personal life and over a little four pound fluff ball. Because of course at the time, if you before Rover and dog vacate, which we will get into in a minute, if you were going on a trip and you were a loving dog owner, you instead of keeping your dog in this lovely home where he or she lived, it would go to a kennel and be in a cage and locked up. And it was really not a great experience. Well, that was actually the debate between Greg and I on basically day one. So Greg, as having been someone who had used a kennel, he had an experience with kennels where I was, you know, overpriced. His dog had gotten mulled. He felt like he'd been nickel and dined. And the debate was, well, that's

14:52All good, Greg, but like, I adore my dog. I know lots of dog owners. I'm not sure I know anyone other than you that has ever used a kennel. And so the big debate was, was more the population of dog owners like Greg Gotisman. Well, of course, I'm going to go to a high end kennel, or more like Aaron Easterly. I'm going to go down the Rolodex, a friend's family neighbors, to find someone I can pawn my dog off on. There are two in my mind, two super, super key insights that Aaron brought to the business.

15:22when he finally relented and we convinced him to become the CEO about a month later. And one was that dogs are family now. And this was a behavioral change that had happened over the last five to 10 years at that point where dogs went from being pets to being, you know, almost at the level of children. And of course, could speak from experience on that. But part two, and operationally, I think this was such an important insight into roverum, what has made it successful.

15:49is that people were already doing this. Exactly like you said, Aaron, many people were not using kennels. They were leveraging friends and family close to them. And so this was not a new concept of behavior change that we had to do with consumers. We just had to bring it online into a better experience and a closed-loop marketplace. This begs the question, you're starting an early stage venture. One slide in your pitch deck is market size.

16:17How do you figure out the market size of something that's currently not being monetized? Poorly. This is the odd answer. We initially looked at third-party estimates of market size. The answer there to pinpoint what you looked at, you could kind of get to three and a half in some sources, maybe six to eight billion in other sources. It's not small. Put that in perspective.

16:42You know about the size of the entire non-search digital advertising industry in the US circa 2008. I think we had six billion in the pitch deck. Yeah, and so and does that include kennels or is that outside of kennels and private professionals for the most part but that was what the industry stats are based on those segments and so that the dilemma was how do you figure out how big the friends family neighbor segment is given that these are oftentimes you know, what we call shadow market transactions. There are people with needs, they have someone meet those needs. More often than not, there actually is a value exchange. But it's not a one. Take your friends to dinner, quid pro quo. I'll get you next time you need something. So there is a value exchange, but it doesn't get reported in the industry stats and it may or may not be monetary in nature. A tough challenge.

17:40one that we didn't even attempt to solve in the initial Series A pitch. We put in the commercial market and just said, and there's some gravy on top in this shadow market segment, which is looking back, which is really dumb because as we found out a couple of months later, that gravy on top is actually ten times the size of the commercial market. So it wasn't so much gravy, it was the entire cake. And this is so fun because Once Aaron joined, you know, we were convinced there was a big opportunity here. If the one of the world's marketplace experts saw the opportunity, we should probably continue to fund this at Moderna. So we were willing to, we were willing to fund this, but we thought there's one person in the world who we should go talk to as well. And maybe we would let them into the round. And that would be someone we've also talked about on this show, Greg McAdoo at Sequoia, because he had just done the Airbnb investment. And so we send Aaron packing down to the valley to go pitch Greg.

18:36Greg says, yeah, that's all well and good, and everybody's doing great, but it's such a bigger market. Look at this market size. This isn't big enough, and of course, it's hilarious because now Greg is of course a good friend and advisor to us at Wave, and he very much regrets passing on the opportunity, but to your point, the market size that was relevant was not the existing market size.

18:58I'm glad you guys thought by the way that the fact I was taking the job as an indicator of the market size. I can tell you my personal thought process was quite a bit different than that, but I'm glad that that's what you guys believe. Aaron was your thought process. Wow, these guys are willing to fund this. There must be something here.

19:16For me, life in general is about having fun, challenging experiences that actually have a unique impact, where you're contributing something that's different than what other people could contribute. You're not just a cog. So for me, the thought process was, this is an opportunity that I think exists, have no clue how big it is, but it exists at some level. There is a chunk of this I think I can help out a lot with, the deep analytics, the marketplace expertise, I love dogs and there's a bunch of this consumer side that I don't have a lot of experience with. I've done most of my marketplace stuff and B2B marketplaces, like search and ad exchanges and things like that. And so I was like, God, there's just half of this business. I'm going to fall on my face daily. And so for me, like, hey, I'm sure I can add value in some areas and have no clue what I'm doing in other areas. Plus, I think it's a big enough opportunity to be

20:13Interesting to throw myself into was basically the extent of the thought process. It's a good thing you didn't tell us that. Totally is. Well, you know, every startup has to go on a little bit of faith. All right, listeners. Now is a great time to tell you about a longtime friend of the show, Vanta. AI has scrambled the whole security picture.

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22:16Okay, so before we dig into the dog vacay side of things and before we start talking about progression from here and the company's growing we've got some fun stories that we wanted to dig into so one is the company was originally a place for Rover and it was a place for Rover.com How long did that last? Actually, about seven years now, our legal name is still a place for Rover. So anytime we file a document, file taxes, file a Delaware, we're still a place for Rover doing business as Rover or Rover.com, but we're still a place for Rover. And I think at the time, it was a Greg's play on a place for mom, which was a mechanism to find care for.

23:00Elderly parents typically also a Seattle company and also had a domain name that was available so a place for Rover wasn't available domain name purchase during the startup weekend and so I think it was as simple as that domain name available had a little bit of a prior art in terms of being used for certain types of care marketplaces but Rover at the time was not available And so we had mentioned this a little bit on our last episode in talking about the T-Mobile Sprint merger. Aaron would love to hear the story from you. How did you end up with Rover.com? This is just one of those cases where connections matter. So some research was done to figure out who actually owned the Rover.com domain name. And it turned out it was ClearWire. ClearWire had acquired it because I was rolling out a mobile internet pock for wireless.

23:57Internet one of the first mobile Wi-Fi hotspots and they'd actually cancelled the product and cancelled the product and also may have run into trademark issues With regards to a French company that had a similar offering name like Roveir or something like that So some combination of clear wire not being able to invest in a new brand slash some long-term concerns around trademark as my understanding We're doing nothing with it had basically decided to put it on the shelf and As it so happens one of the other managing directors at Madron at the time sat on the clear wire board your former boss former boss from a quantum When we found that out he shepherded a conversation around hey, so you're not using this domain name You want to give it to us and the answer was no, but since we're not using it

24:51How about we're willing to lease it to you guys for a little while. So we initially leased it for like next to nothing and then bought it pretty cheaply actually compared to what five letter domain names with some level of actually brand equity already go for. We got super cheap, near Palindrome, you know. You know, just, you know, in the US at least is this thing that means doll. And we're talking about a service.

25:19that actually makes it easy to move your dog around when you're traveling, so helping your dog roam around. So it was perfect and cheap and serendipitous. One other real quick fun story is that for the rest of the summer as we were building the MVP, based in the Moderna offices, the old Moderna offices at the time, the first dog stay happened in the actual live dog stay happened in the Moderna office. And of course, the dog decided to use the bathroom.

25:49on the floor in the majority of the office. And our awesome, truly, truly awesome and lovely CFO and General Counsel at Majorana, try to check us. Basically, I don't think I've ever seen him more enraged than at that moment. And he was, he was so skeptical of Rover for years after that. But hopefully everything's, you know, everything's a dusted over. Oh, it was about a week after that, too, where Troy came to me and said, you know, It's about time you guys find your own place. So we got the boot soon thereafter, which was time. We did have our own funding. We could get our own plays, but I'm pretty sure the timing of that was driven by the dog with the explosive bowels.

26:34Yeah, or at least operate a marketplace instead of you yourself sitting the dogs. Which at the time, a lot of us actually engaged in dog care as well on both sides of the marketplace to try and get a sense for what worked and what didn't work. I was an active sitter for the first several years. I think I still have over a hundred views on the site. So probably book close to 1,000 nights of care just as myself as a sitter.

27:02you know, experience a lot of awkward situations. In the early days, a lot of us were doing that to get a sense of what worked and what didn't work for the thing that was inherently somewhat awkward in the early days. I mean, one might call it eating one's own dog food. Okay, we've been on. Before real quick, before transitioning to dog vacay, it's worth mentioning to listeners, we've touched on sort of how David and I know each other, but Rover is really to thank.

27:28for many, many things that have happened in David in my life sense meeting. The genesis of Madonna Labs, a group that we had started inside of Madonna years later to...

27:40Be a startup studio inside of a venture firm was really the reason why we justified, hey, we think there's a chance we could do this is because of Aaron and Rover because Greg was able to point to that and say, look, we did it in this super ad hoc way. What if we systematized the process? And so I left Microsoft and went to Madonna and met David. And of course, that's the exact same thesis that we have now at sort of this broader scale and outside of a single firm with PSL. And David, obviously, instrumental for your marketplace thesis.

28:09It's a combination of both of the aspects of Rover, of starting companies and investing companies at the very beginning, before there's a product, as we just talked about, can work and also in the disruptive power of marketplace businesses.

28:25Thanks, Aaron. Thanks. You're welcome. Got it and screwed up and perpetually ruined your guy's career. Talking about that. So speaking of dad jokes, essentially. At the same time, not quite the same time, but slightly after, as this is all going on and we made no secrets about what we were doing up here in Seattle and in fact much of the tech press.

28:52Pillaredus called this a sign of second sign of the tech apocalypse pets.com take two, but you know as Jeff Bezos says, well, it's the willing to the Washington Post is willing to put body parts through the ringer, but if you're not doing something that people make fun of, you're probably not doing something interesting. Yeah, I think we're made a list of the top five worst ideas that are VC funded in that year. It was a fun for us to get. And the fine thing about the same time that people are like, I can't believe this is a thing. This is embarrassing. Why would anyone ever invest money? At the same time, that was going on. Like the next three or so startup weekends, the idea that was pitched in one was the same day on my ears. That's the copycats started popping up. So people pitched literally the same

29:41Airbnb for dogs again literally pitched the exact same idea and the people who run the startup weekend event were like hey guys this one last week, one last two weeks. And the judges are like, I don't care, it's cool, I like it. And because in every town, there's a different set of judges that are local and we're into the last one. So it's new to them. And so we went from kind of, oh my god, this is almost laughably bad idea to at the same time having like 10 companies announced that they were going to do it. So it's kind of like the worst of all worlds where you have now like 10 potential competitors for an idea that everyone thinks is awful.

30:18Seems like there may be something to with them. Human psychology is so fascinating. So among the competitors that pop up, the most credible by far is a company based in Los Angeles called Dog Vakay.

30:31And Doug Vake was started in the fall of 2012 as part of the incubator down there, the well-known incubator science, started by Mike Jones formerly of Myspace and Peter Fam. And it was started by Aaron Hirshorn and his wife Karine. And they were dog owners and Aaron had been a...

30:49Confusing was confusing for many many years. We have Aaron E up here in Seattle and Aaron H down in Los Angeles But Aaron H had been a consultant for many years and it actually worked at a venture fund He was among the minority of people who realized that this was not a bad idea but actually a great idea So they started the company and then in the spring of 2012 they raised a seed round led by first-round capital and Jeff Jordan from Andrews and Horowitz from then that point on really the race was on and it was later that year that Bill Gurley at Benchmark would lead their series A and he correctly identified the massive marketplace opportunity here and Bill had already was famous for many marketplace investments including the series A of Uber. He wrote a canonical blog post called Not All Market Places Are Created Equal.

31:39He put forth his framework for evaluating marketplaces and then wrote a sidecar, essentially investment memo that he published for dog vacay about all the marketplace dynamics and why this made for such a great investment.

31:51And he was completely correct. Yeah, and Bill's set a post on this, our Biblical, for listeners that are thinking about a marketplace business. And in fact, David and I were talking about a concept yesterday, we were like, we should probably put it through Bill's framework. Like this is this is sort of the way to think about marketplace businesses. And I in doing research for this episode just found out it was it was modeled after the dog vacay investment. And so that happened. And then right around the same time, we raised the technically serious bees since Madonna had done the A but effectively the same amount of money from Brad Feldt at Foundry Group here at Rover. So I'm curious, we on the Madronan Adventure side had lots of thoughts as all of this was happening, but how did you feel Aaron when these competitive financing's are happening? You know, I think all this stuff matters a lot more to VCs than it does to me. You know, at the time, there's a lot of marketplace orthodoxy around every marketplace is when it takes all.

32:45Um, and every marketplace is, you know, first to scale wins. And we have to be super aggressive because no one can ever come back from being a little bit behind. And so if you believe this, and if you spend a lot of time being a VC and you care a lot about other VC's track records and who are the big names, you care about this stuff. If you don't, you don't. And I probably found the category of not caring. Now, eventually I did care when it affected whether or not other people were willing to give us money and had to figure out how to speak to it. But it's definitely one of those things where Greg and others at Madrid, you know, were a lot more intrigued and concerned around who might be investing in dog vacay than I was. It's one of these classic things to the operator mentality that makes people so good is being able to shut out

33:42A lot of the noise and a lot of the things other than put your head down and focus on the business because you're probably gonna make missteps and Kill yourself long before your competitors will kill you Obviously not the case here both companies pushed on and we're successful for a long time so I'm just going to refrain from all the tail chasing analogies. I mean, basically, listening to what happens is that was the end of 2012. From the end of 2012 until the merger happens in the beginning of 2017, Rover and Dog Vacay are in lockstep in terms of growth, in terms of fundraising, at least to the outside and VC perspective worlds. But underneath the covers, we were doing a lot of really interesting things in Rover.

34:27And I'm curious to your perspective, what were the things that we decided to invest in that helped us in the long run? Ultimately, we thought that this business was going to come down to marketplace mechanics and how you make use of data. One of the things that a lot of people believe about marketplace is that they can have great economies of scale.

34:48but sometimes people forget to ask the question of where those economies of scale are coming from and whether they happen naturally or they actually have to be earned. And so there are certain cases like an Uber that the commies of scale can happen naturally. So for example, you just get more drivers on the road relative to the demand and all of a sudden your wait time.

35:09After you hit the button is less and it happens for the most part somewhat naturally and you can improve and optimize it but just happens or Airbnb more people in more cities come on the platform and now you can travel to more cities and it becomes more a part of your life and you book more and then that brings more supply Our view though is that most of the economies of scale in this business weren't gonna just weren't gonna come from just pure scale It was gonna come from the use of data on the back end that there's a big difference in the performance of sitters there's a big difference in the desirability of certain sitters there's a lot subtle micro differentiation and so the design the marketplace mechanics design the backend data would matter a lot more than any short term advantage in scale and one of the other things that actually gave us conviction around that was that

35:58This business was about the shadow market. It was about the people that were using friends, family, neighbors. Businesses that are free to use, I think social media can kind of spring up almost overnight. Businesses that have a large existing market where a better version or cheaper version comes along can kind of spring up overnight.

36:19But businesses that are mostly about changing fundamental consumer behavior and not the existing commercial market and aren't free to use, those are grinds. They play out over time, behavior fundamentally changes. There's a limit to how fast you can go on those businesses because you actually have to adopt, consumers have to change their behavior. And in something like travel, people on average travel 27 nights.

36:48a year away from home. So at any point, tie, like... Very few people actually have a travel-related need. So there was an inherent speed limit on this business. So you couldn't just pump a lot of PR, pump a lot of marketing, and somehow create an insurmountable lead. Our view was that it was always going to come down more to the back end piece. I remember you talking about and giving me and Riley the advice as we were starting with that these speed bumps At first blush can seem to be negative factors in markets. But if you believe in the ultimate market size enough, they become a competitive mode. This is certainly an outsider's perspective, but what I think was held to be true in the industry was

37:30rovers really, really good at engineering, at data science, at operations, at really aggressive segmentation of their customer base and understanding exactly what drives behavior and narrowing funnel, like being really crisp on your funnel and removing leakiness wherever possible, and in the most aggressive ways. If there was a dollar that rover could spend on a brand advertisement versus a way to further decrease drop off in a funnel step, it was absolutely going into that funnel step.

38:00every single time. How do you sort of look at the way that you guys did that and how it showed up in short term versus long term? So listeners have a little bit of visibility on this. I don't think Rover was leapt out to a lead in the early day. Is he correct me if I'm wrong, but I think in that 2012 to 2014, there's a lot of metrics you could look at where it looked like dog vacay was really on the lead.

38:24No doubt about it. Dog VK got a much faster start, did a much better job with initial PR and marketing and graphic design, had a group of well-known Valley investors and got out to a fast start. At one time, LA and New York, which are large markets, Dog VK was six times our size in both of those markets.

38:48When we were doing a deal with dog vacay, we were materially larger in both of those markets than they were. So Cam came back from a six to one deficit to be a clear leader in those markets. But we got our butt kicked in the early days. It's just interesting to hear stories like that and try and draw. Draw inspiration for future times when you're getting your butt kicked. But you know, it's an interesting conversation because going back to tuning out noise thing, you know, love Greg. Greg is super helpful about the company.

39:16You know, probably multiple times a week. You know, I'd get calls around how frustrated he found it that he was reading dog vacase PR all the time and they were in the press all the time and had all those buzz all the time. And those things worked, like clearly in LA and New York, his great example is get a bunch of sitters, you know, get a bunch of customers. Yeah, and you know, definitely help get the business off the ground. And I would say It was also helpful of creating awareness for the category, which had a follow-on benefit to Rover. Looking back, ultimately, I wish we had done a little bit more in PR in the early days. It took us a while to make up the ground on SEO, for example, and domain authority. We could have been a little bit more balanced, I think, on the net net. It was the right overall prioritization, but we could have been more balanced in our practice. And it puts a more specific on this for listeners who aren't necessarily experts in marketplaces.

40:08I mean, for me, this was like a education on the fly in how to manage these things. It ultimately kind of came down to all the dynamics and investment on data science and the backend and funnels and analytics that we did at Rover meant that our conversion rates as new customers, new needs were hitting the marketplace.

40:28ended up being much higher over time than our competitors, and then not just the conversion rates, but also, most importantly, our repeat booking rates. Because as we were acquiring folks, the lifetime value of those people, because they would convert at higher rates, but then repeat much more often, just ended up that even though we had a slower ramp, the exponential kink in the curve was that much steeper.

40:52And the important thing to note here is you think about the equation of cost to acquire a customer versus the customer lifetime value and trying to make that delta as wide as possible, that multiple as wide as possible is They're not a customer until they actually book in a marketplace business. And so the more funnel optimization you can do where you increase the rate of sign up to booking, the more you can spend and the broader you can spend on getting new people in the door. I think you did not actually customer until they complete the transaction. Yeah, yeah, yeah. You know, if you think about if you're twice as good at turning someone who hits your site into someone that completes a transaction, then

41:32If you're competing over the same ad words keywords, you can outspend because you know that you're going to be able to more profitably move those customers through your process. Indeed. I think the other thing that cannot be understated, I'm sure Aaron would agree, is a major moment in Revers' history, which was the hiring of Brent Turner in January 2014 as Revers' COO. Aaron, who is Brent and how did that all go down?

41:59Brent has been by companion for most of the last 20 years in Seattle. Brent and I met in the early days or the pre-public days of Avenue A, which later became a quanif. We've worked together for something like 17 in the last 20 years. There have been times where I have reported to him times when we've been peers, times when he's reported to me, but the vision of labor was kind of always the same.

42:24I took about three years of effort for me to get Brent to become involved in Rover. I tried to get him as an angel investor in the early days, and I think- Rovers like a war of attrition of people convincing each other to do things. For a company founded on love of family members. There are some funny stories with people who when I left Microsoft were like, hey, just tell me what you're doing next. Whatever you do, I'll invest in. And then I got over there with Rover, and they're like, Except that. Except. I'm not gonna invest in that business. I mean, including people at the VC world. You look very well-known venture firms that you flew down to the valley to have meetings with where like, oh, actually, not, sorry, not that thing. Yeah. I would invest in anything but this or like, so what are you doing with your career? This seems like the worst idea ever and you're throwing away your career. Do you know you're doing that?

43:19And so Brent wasn't being someone who I'm also friends with and cares a lot about. He was more diplomatic than that. But basically, he was just like, dude, I'm not giving you angel dollars for this. I'm not sure that it does this here. I'm not sure. And so I kept on for a couple years and was kind of like, okay, well, here's how we're doing it. And each time was like, well, it's a bigger opportunity here that I thought.

43:44So eventually convinced him to join Rover and in a lot of ways, Brent's a co-CEO, but the best manager I've ever met, the best developer of talent I've ever met, the best operator I've ever met, kind of rounding out the diversity of skill sets and the Rover executive team. And we were having drinks last night with Phil Kimmy, who of course is still lead developer for Rover and the studly college student that...

44:12separate. We should we should we should tell a little of Phil's story so after staying the summer then Aaron and Greg lobbied him to not go back to school including calling his parents including calling his parents and convincing them which Didn't go over well then and continue to not go over well for years years Well, you know, so Phil Phil of course did drop out and as a co-founder of Rover built the engineering side of the business with with a great engineering team into what it is today And only recently have have you know Phil's parents started to come around on Okay, there's something to it. Well, I think they're both doctors. So, you know, both your parents are doctors and you decide, hey, I'm dropping out to go to do doxidine. You know, you can imagine why that might be met with a little bit of skepticism. But Phil's point, of course, having been along the ride for all this journey as well, was that just like we were talking about...

45:04You know, if you had to choose a dollar to invest in the early days in your back end and data science analytics for marketplace versus marketing and growth, you should for sure choose the back end every time. However, ultimately, you need to do both and that it was Brent's coming on board in 2014 that really built the muscle and the company to be able to do both and be world-class in both. Cannot understate the impact there. All right, listeners.

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47:07So if you're trying to turn AI ambition into real business outcomes and make it work safely, securely at scale, go check out servicenow.com slash acquired and tell them that Ben and David sent you. Well, David, do you want to bring us to kind of the year leading up to the merger? Yes. So as all this was happening, I believe Rover and dog vacay raised four rounds of fundraising in lockstep three or four rounds.

47:34For the most part, R-A was kind of their seed, R-B was kind of their A, you know, R-C was kind of their B, and we were in touch with them during that time. Yep. So all along, there's a little bit of a dance going on, and of course, you know, on their side, on the VC side, which is more of what I had exposure to.

47:54Bill Gurley had lived through a very similar dynamic with Grubhub and Seamless in the food delivery space, being two competitors in a market, both private companies, both scaling nicely. You could see a path to being large public companies someday in a difficult manner, but ultimately affecting a merger between the two of them, becoming Grubhub Seamless one company before going public and that really being a great value accretion event for all shareholders. Bill really started lobbying the investor base first within dog vacay, but then on the roverside to consider following a similar playbook in this base. And it ended up taking, gosh, it was, I mean, it was over a year, well over a year of lobbying and negotiations before we really. Many years, actually. Many years. Yeah.

48:44We actually, the conversation around putting the companies together actually started in year one. Aaron Hirschholm and I actually had a pretty healthy relationship and I actually brought this up with him around the time of the A, series A round and said, hey, seems like the companies are onto the same thing. You guys seem to be a lot more competent on the marketing, the PR side. I think we have a lot of advantages on the back end and the analytics and the marketplace side.

49:14I think how this is going to play out is you guys are going to get off to a fast start. The our advantages will matter more over time and then we'll like pass you over time. But you know, do you want to consider putting the companies together now, given that we don't have a lot of overlapping executives. We haven't raised too much money. I'll just get harder over time. So that's a conversation I actually had with Aaron H in year one. Well, I didn't realize it was that early.

49:40Yes, I don't think Greg was super excited about the idea, but it was year one that I had that conversation. And you know, generally turned out to be true. I said, hey, you guys are going to raise some money. We're going to raise some money. You're going to raise some money. We're going to raise some money. And that played out. And it also played out that it was more difficult as time went on to have the discussion, more investors at the table, more decision makers, more overlapping.

50:06Functions, more overlapping, and the exacts, it just becomes hard. This was a lesson to me as over the year and a half, almost two years, that it was really active leading up to the actual merger of how hard it is to affect these things, particularly with private companies.

50:28my wife Jenny and I used to joke that Bill really had like a knack of just calling it the most inopportune times. And there was one one time in particular where we were we were on vacation we were in Bill doesn't know this but we were in in Cambridge in England and we were going to even song at King's College Chapel which is this amazing you know very Solum event, we were in line, they just opened the door to the chapel. Hundreds of people are filing in, you know, you have to turn your phone off when you, when you enter the chapel and my phone buzzes, I look down and it's like, of course, it's okay. So I said, hold on a minute, but it was, it was hard work getting it done. And which I'm sure you will on the operating side agree with as well. Aaron, take us through what did the process look like to everyone look around the table and say, yeah, we're going to do this. And then after that, the integration.

51:23There are several overtures made over the years and Including people cornering our investors at conferences and saying you guys should do this We'd get that over time and you know, there's a couple times where Aaron and I talked around You know how we might engage in a process and you know, it was tough to get agreement you know at a high level there's a bunch of things that make Getting to agreement difficult on these and the first and is that entrepreneurs by their nature, especially in tech, have to be a little delusional. In order to take on the risk of starting a business that most of the time is going to lose a lot of money before it ever makes money, the odds are stacked against you, lots of risk, lots of complexity, but for you to decide, you know what, like this is a good decision with my life and my career, you just have to be a little delusional.

52:15Well, it's in news to me. You didn't believe in the market size at the beginning. Or yeah, a little delusional or during the job for different reasons. And so because of that dynamic, that kind of confidence, faith, commitment, like we can figure this out, we'll get it done. It also can make negotiating terms challenging.

52:41because entrepreneurs typically have a pretty high faith in themselves and they're ready to get done. And when companies are both private, there's no stock market that's a third-party validation you can point to for relative value and share price. Totally. Yeah, stock market would be like, okay, here are stock. Here's what the markets think. You can debate around the edges a little bit. Most of the time, it's relative to that. With private companies, you don't have it. Most of the time, they're not making money.

53:11At the time, so you can't look at profit multiples. You've got to look at some combination of revenue, unit economics, relative growth rates and touch rate. Not to mention. More important on the investor side, but also equally relevant on the entrepreneur side. There are two preference stacks for each of these separate companies in terms of the money that each has raised.

53:33It's challenging to figure out how to combine those. Yeah, and for folks listening who aren't familiar with preference stacks, basically when an investor comes in and does the most recent round, they have the preference in case that it's basically downside protection. If the company ends up selling for sort of less or in a downside, they're sort of the first to get their money back. And that continues in a waterfall on down to their earliest investors and then to the common stock. Of course, the issue David raises is, now you got two sets of those, what do you do?

54:02Yeah, like do they both investors get to keep them and you burden the company with the combined preference? So like if there's been $300 million in total invested and that definitely wasn't the case in this case, but do you say okay? There's gonna be $300 million of preference and so none of the employees are gonna get anything until you get well above that point and create some pretty perverse incentives.

54:29Do you eliminate the preferences? If you eliminate them, how do you get someone to agree to eliminate their rights to that? And how do you figure out how much of that reduction is eaten by side A versus side B? And related to the preference that's slightly different is sometimes there are also different control or voting rights attached to each round of financing someone has done. So in some cases, just the investors in the last round have a right to veto certain decisions so it becomes a very complicated decision process with the law stakeholders all in the context of entrepreneurs feeling optimistic about the go-to-loan approach all in a context of a lot of uncertainty and that's just getting the deal terms which for me is half the battle people have very complicated ways to think about M&A acquisitions mergers you know for me there's two simple questions

55:26Do you have conviction on the deal terms? Is it good deal terms? Do you think there's going to be more value than what you're paying, whether you're paying an equity, cash, whatever? And the second is, do you have conviction around the post-close plan? Can you actually execute it? And the second one is often forgotten about. It's tough to get to terms, but in the tech world, if you look at the history of M&A, Most people, including third parties, would say that the vast majority of acquisitions are failures. The basis for this show. The vast majority are failures. The reason why they're failures is not because they were off slightly on the negotiated terms. The reason why they're failures is because the execution post-close destroyed a bunch of value. If you don't have conviction in the execution plan, regardless of how given a negotiator you are, it's not going to work. It's not going to work.

56:21And so Aaron, what was the execution plan then coming out of the merger? In this case, we decided to do what we called a hard cutover. So basically we're going to migrate all dog vacay customers on the demand side, all their sitters on the supply side over to the rover platform and basically execute a shutdown of the dog vacay technology and probably the office. We were going to offer some jobs to people to move to Seattle, and some cases we may allow people to work from out, but we decided to do a hard cutover. And again, that made...

56:56So much sense because of all the dynamics we talked about before, just the marketplace of Rover converted at a much higher efficiency and then repeated it a much higher efficiency. So again, it's in everybody's best interest to add in all of this new liquidity into the marketplace. New supply, there's new demand. It's suddenly easier to find a sitter near you. It's your finding higher quality sitters or better match sitters, all the benefits of having a lot more people on the platform. David, I'm going to say the word again. And I think now it's It's actually a thing that I say on the show, which is unfortunate. It's like legitimate actual synergy. And it's actually, it's true. And how much of that's a realizable versus in theory? But I would say it's easy to say, oh, this clearly made sense. There are compelling alternatives that smart people can rationalize.

57:51you know, in marketplaces, sometimes there's the, hey, let's have two independent brands. You know, if you're dependent upon, what's we've covered? A truly in Zillow. If you're dependent upon SCO or SEM, why remove one of your slots from Google? If you think that there are different consumer segments, so the different brands may actually attract different people and into specializing in different things. So for us, you know, the options we consider it is, You know, two brands and two back-ends, so there's two front-ends, two back-ends, two front-ends, but one back-end, or one front-end, one back-end. And the challenge with this is that there's pretty compelling rationales for each of the three. And if you look at how a lot of the marketplace businesses have managed this, not everyone goes aggressively to the one front-end, one back-end.

58:46Very few actually have. But we were at a stage where we thought that slowing down for two years while a bunch of internal lobbying went on around this, a bunch of systems integration with different text acts, different coding languages, different skill sets, different architecture. We just thought it'd be a disaster to lose two years in that type of integration, you know, that if we were further along, you know, if we're already a public company, you know, or soon to be like GrabHub and seamless, maybe we could have made a different choice. But we just thought it would slow us down quite a bit for uncertain benefit of keeping the brand. But it's also the most offensive thing to propose to another company. Hey, we want to do this deal. We're excited about it. And by the way, we're going to quickly throughout everything you've done.

59:45It's just really, really hard. And yet, if you don't get that agreement in advance, your chance of successfully executing a deal post-close is like, no, or at least it will drag out for a really long time. We thought all this through in advance, and we got agreement from dog VK that we weren't gonna close on the deal unless both sides could mutually agree upon the post-close.

1:00:13plan execution plan integration plan and so kudos to the dog vacay senior leadership team their executives came up met with us we kind of laid out each of the three scenarios said you know here's what we think the advantages and disadvantages of each one you tell us which one you think makes sense we didn't offer our own opinion and we didn't buy us the conversation and unanimously their executive team said hard cut over go to the rover platform Which, you know, probably take a lot of courage. Yeah, rational as that may be. There's huge emotional, you know, attachment to it, not only what you've built, but the dream of what could be. Totally. And then it creates a bunch of uncertainty. Well, God, if the platform is going to be rover, then what happens to the Santa Monica office? What happens to my personal job? I have a lot of expertise on how our system works and our system's not going to be relevant. You know, it was very proud of the dog vacate team for being a consummate professionals.

1:01:11You know, the right call, but we were unique. If you look at Odeski lands, if you look at Grubhub seamless. Zillow trillia as well. Zillow trillia, none of those companies had attempted to be as aggressive with the plan as us. We wanted to be done in six months and not two years, not three years, not a year. So kudos to the team for being able to take that on with such passion. This might be a ming.

1:01:40many lessons for listeners in this episode and for all of us personally living it. I mean, this is ranks right up there as hard as it was in terms of as we were talking about all the stakeholders on the investor operational side taking years to get to a point to want to do a merger. The speed and effectiveness of the integration.

1:02:02and the vast outperformance of it and the combined company. I mean, I remember we were all of both sides putting together spreadsheets, you know, throughout the negotiation process of what we thought the combined value could be in growth thereafter. The company has far exceeded that on all levels. And I think it's a testament to all of this and the team and the Doug VK team for suggesting this and the Rover team for everybody combined, executing on it. It has definitely been the best thing for the company.

1:02:31and for the companies, for shareholders in both companies. Yeah, I think it turned out to be the right plan, execute well. We got done in about half the time and exceeded every three months, right? Three months, exceeded the goals on the successful sitter migration, successful owner migration. It was well execute and we had given stay bonuses.

1:02:57to people in Santa Monica, because there was uncertainty around whether or not there's still gonna be a job after we got done to migration, we accelerated, we gave new grants and accelerated portion of them. That was kind of a based on when the migration was done. Hopefully people feel really good and felt like they were treated well and appropriately rewarded for what a herculean job they did in a small amount of time, but turned out to be the right plan with better than expected execution.

1:03:26And that kind of brings us to today, Rover just recently announced a combined company, a major new fundraising. Things are going really well. And I think particularly, well, we're expanding internationally, which is wonderful, but particularly not having the distraction, not having the distraction of all that at a moment when we were just starting to layer in all the additional services besides dog boarding.

1:03:49dog walking, daycare, all the other in-home services, which have become huge growth drivers for the business was critical. Yeah, I think that's one of the biggest reasons we didn't want to slow down. We view this area as like when the second or third inning, we're a small fraction of the size we hope to be long-term. Most of our business was overnight care. We had rolled out dogwalking and dropping visits and in-home daycare. At the exact same time we were doing this migration, we launched our on-demand dogwalking effort. So why not? And so it was one of our biggest concerns is that it's not like we were a manufacturing plant and we're like, okay, we're operating at capacity. Now can we squeeze out a little bit more efficiency? Our view is

1:04:39We're nowhere near capacity in terms of what we want to accomplish. You know, let's not slow down the speed and minimizing the distraction of the execution plan was super important. So we could launch on demand dog walking. We could roll out new offerings. We could start to look at aggressive international expansion, which we were kicking off right now in Europe. Let's do our other sections here real quick and make sure we check a few boxes. A couple of points that I think we haven't quite made yet.

1:05:07Listeners, our next section is acquisition category where we decide whether it was a people technology product business line asset consolidation or other type of acquisition. Clear consolidation. I don't think there's anything we're looking around the room. We're all nodding our heads. There's not that much has been discussed. There's what would have happened otherwise where, you know, one thing that I think we touched on a little bit here is the cost to acquire a customer and the sort of war going on between former VK and former Rover and the dynamic of this type of business and I'll explain sort of my understanding of it and Aaron you can correct me in areas where I don't have enough sort of sophistication or understanding of it, but

1:05:48This business is a very intent-driven business, so people go to Google and they search on the internet for a solution to a problem that they have, which is I need a dog sitter. So you gotta buy all the keywords to cover all of those things. Now, Google's keyword tool is, of course, an auction. So with two parties bidding it up, your cost to acquire should be meaningfully higher if there's two people bidding for it than if there was just one major player. And so then you have both of these companies that are always aggressively bidding on these keywords, driving up the price, and as soon as there's just one party, it should theoretically be much easier and cheaper to acquire that person who has intent to do the thing that your service provides. Was that a major driver of the acquisition? And have you kind of seen that materialize? Sure, so I think the question is, is whether or not the savings on the marketing side was a major area of value of the acquisition? The answer is yes.

1:06:38A lot of people suggest valuing these types of deals on strategic value. Your multiple as a public company would be higher with the consolidation and that's not how we did it. I struggle with hand wavy things and I struggle with this assumption that there's going to be some long-term multiple gain when we live in a highly dynamic area where there are lots of big funds and competitors can get funded.

1:07:08competitive landscape change. So we modeled it as basically a cash flow. Like what is the amount of incremental revenue minus incremental cost and the case where there's cost savings and obviously you add the cost savings over some number of years. And that's how we added it. And it turned out that only about 15% of the value of the deal was dog vacay's existing revenue stream.

1:07:34The other portions of value came through other forms and savings on the marketing side was a big one. Some of the other ones, though, were a better data coverage. To the degree, our marketplace works well because we do smart things with data. In order to do smart things, you have to kind of with data, yeah.

1:07:55Two things. You have to have data. And you have to know what the smart things are. And for the service providers that were on both platforms, it gave us a more holistic picture of how they perform and do people like them and do they use them again and how responsive are they? And then for people that are on just one platform, for example, just on dog vacay, we were able to use kind of those algorithms that we had invested a little bit more in to help evaluate those people.

1:08:24And so we got a decent amount of value from Call It, the economies of scale on the data side in addition to the marketing savings. Interesting. Never would have occurred to me. That's cool. Tech themes and then wrap up here. Sounds good. You want to go first, man? That was my major one. It was really the era of the fruits of competition lining Google's pockets. I have a couple, but I think the biggest one is something we've talked about a lot on the show and reliving the story has brought back to mind and recalled for me.

1:08:54the lived experience here, the adage, the two by two matrix of the way you make money investing or starting companies is not just by being correct in your hypothesis, but having a correct, non-consensus bet. And I think back to...

1:09:10the early days of Rover and the signs of the apocalypse and pet.com and I will, Aaron, I will give you money to do anything. Oh, you're doing that? I'm not gonna give you money to do that. Now, sometimes when you do that, you are wrong and everybody else is right. And then, you know, not only you don't make money, it's not just about making money, but you fail. But the way that you win and that you win really, really big is you do things that are correct and not obvious. And Rover, to me, is just a shining example of that.

1:09:38and Peter tealed zero to one. What's your secret? Aaron's secret was dogs. Dogs are people too. But it was also the thing that, like, you know, if you spent 10 minutes and got over the knee jerk reaction, even though, yes, we weren't clear on market size and we've joked throughout the episode, like, we knew there was something here. We knew there was something here. Everything else, I think we've covered. Yep. Greetings. I'm going to be quick. This is an A. Nice job.

1:10:00Well, thank you for having me on the show today, by the way. Just to be clear, our view is that we're having achieved anything yet. You know, we're still a money losing startup that may be more on the late stage side and there's a lot of work to do. It's nice to be right about some things early in the company's history, but we need to be right about a bunch of things go forward too. But I really appreciate the chance to come on and share a little bit of our story.

1:10:28So if you're in the Seattle area or not in the Seattle area, and you want to be part of a great company, that's already great, that still has a long journey ahead of it. Come talk to everyone here at Rover. Yep. All right. All right, listeners. Now is a great time to talk about one of our favorite companies, Statsig. Yes, there is a reason why the best product teams rely on Statsig, whether they are iterating on their core product features or shipping AI-powered experiences at scale.

1:10:57Yep, in the crazy speed of today's AI world, shipping fast is just table stakes now. It's basically trivial to build and deploy your app constantly. The real advantage is how quickly you learn...

1:11:10what changes actually created value for customers, and how fast you can use that signal to guide what you shipped next. This is where Statsig comes in. It brings experimentation, feature flags, and product analytics into one unified system so teams can ship safely, test rigorously, and directly link what they changed to how users actually behaved.

1:11:29So if you want to make learning your competitive advantage, whether you're building new AI experiences or just evolving your existing core product, go to statsig.com slash acquired to get started. Let's wrap up. If you like the show and you want to hear more episodes, you can subscribe from your favorite podcast client and come join us in the Slack at acquired.fm. Thanks, everyone. We'll see you next time. Thanks, guys.