[MUSIC] >> Hello. >> Stewart,
it's a pleasure to have you here today. >> Thank you. >> How are you doing? >> I'm well. >> Cool. So typically we would start
these with a question, asking the students how
many of you use Slack. But since it's the official
communication platform for the GSP, we're going to have to
do something a little different. How about a game of two truths and a lie? >> All right. >> Cool. So up here on the screen in just a second,
we're going to see three statements that I pulled from my
extensive research of your past. We're going to ask the audience to
guess which one of them is a lie. So, statement one, you were born
with a name Stewart Butterfield. Okay, statement two,
you have two philosophy degrees. All right?
Statement three, Flickr, your first successful startup was conceived
while battling with food poisoning. Okay, so the audience, raise your hand
if you think statement one is false. Wow. It's a lot of people. [LAUGH] Raise your hand if you
think statement two is false. Okay, raise your hand if you
think statement three is false. >> [LAUGH]
>> Okay, Stewart. >> Feeling pretty good, it's number one. >> It's number one, so
you were not born Stewart Butterfield. >> I was born Dharma Jeremy Butterfield
to hippy parents in a little town called Lund in British, Columbia which
is literally the end of the road. So Pacific Coast Highway is the same road
that goes all the way down to Chile. And then all the way up to where
the Fjords of British Columbia, and the fact that there's no really,
there's no people within any further north means that it was foolish to
continue building the road. So, born there and grew up in a log
cabin for the first couple of years. >> Grew up in a log cabin? Abe Lincoln also grew up in a log cabin. >> Very, yeah. >> [LAUGH]
>> That's why I bring it up, for the positive associations. >> [LAUGH] Yeah, so
trust me, I understand. My parents named me
Trevorski Tylon Garrett. And as a four-year-old, I was not writing
Trevorski on every spelling test. So I go by Tylin, and
you actually know me by Ty. >> Yeah. >> So-
>> T-Y is very creative. >> [LAUGH]
>> So when I was 12, I really wanted to be normal. And for some reason, I thought Stewart
was a normal name, like Mike, or something like that. >> [LAUGH]
>> And Stewart, it's a pretty bad name. You'll notice this after I say it. Any time you watch a movie, TV show,
there's a character named Stewart, there's like the jerk version and there's
like the sad sack kind of loser version. >> [LAUGH]
>> Which never a protagonist with the exception of the mouse Stuart Little. >> Stuart Little. >> [LAUGH]
>> That was one of my favorite movies growing up. So if you could pick any name today,
what would it be? >> It would be Dharma Jeremy Butterfield,
it's a sick name. >> [LAUGH]
>> Cool, so you hinted a little bit on your parents. What have been the most lasting
influences from their parenting? >> That's a good question. I mean, it's hard to separate out that from what life would've
been without those influences. My mom is incredibly supportive
to the extent that when I was 16, I got in a car accident,
just totaled the car, my dad's car. And my mom's reaction was, well,
it's really good that you did that, because you learned an important
lesson about driving safety. [LAUGH] Which is not
the reaction I was expecting. My dad was a real estate developer, and
real estate development usually works, the people incorporating new entity for
each project or each development. Maybe there's a management company
that takes measuring fees but it kind of isolates the investments, which means that it's like creating
your business over and over again. Like every two or three years,
there's a fundraising cycle, and there's kind of putting
together the vision and a plan. And then over the next decade or
so, that plays out. So I think that was a big influence for
me, just because I got to see
the development of, I don't even know. Over the course of my childhood,
once I was aware of what was going on, maybe five or six different businesses. And that was good practice, because I think I started
looking at the world that way. >> That's cool, that's cool. So you were born Dharma Butterfield. You were raised by parents who
aspired to live off the land. It only makes sense that you
would be drawn to technology. So what led you to teach yourself
to program at the age of seven? >> Computers were just so cool and
even like you see now, any three-month or six-month old are just drawn
to the iPad in a way that seems like it must be indicative of
a lower level brain function that was hijacked in order to be attracted to this. So for me, many screen, just like any child,
any screen was just super attractive. But the idea that you could control
what appeared was really magical. And it was 1979, 1980, somewhere around
there, I got an Apple TV at home. So we had one in the classroom. So the very first class at my school
to have a computer in the classroom. And I would buy a copy of a magazine
called Bite which in the back, a couple of pages had programs that you can just
type out yourself in an Apple basic. And you can change a couple things, and
see what happened, and it was really, I have difficulty describing like
why it had such a powerful hold. But what was interesting is if
you fast forward like 20 years, there was, I had an early getting
console called television. So like video games, like most boys my
age, there are arcades where you went and put quarters in machines and
stuff like that. But computers themselves became less and less interesting to me over the course of
high school but when I got to college, I got an account on the school's Unix
machine and discovered the Internet. This was 1992, and
that was just totally mind expanding. And I almost couldn't believe that
such a thing was possible, and had like the same feeling of wonder,
but to a higher degree. Because it was like we as a species, had developed the ability to
transcend geography in a much more profound way than like long distance
phone calls had or the telegraph had. You could find community,
I grew up in between College in Victoria, British Columbia, which is again on
the edge of the continent, very remote, kind of provincial. And you could find people who were
interested in exactly what you were, anywhere in the world, and that communication was happening
at the speed of light. So that really opened it up, and
then fast forward another ten years. So like in the early 2000s, I had this experience finally
where I had my laptop with me, and at one point in my life had been like
the Steve Jobs bicycle for the mind but this incredible machine that anything was
possible, and all this amazing software. When it wasn't connected to the Internet
was inert, was basically kind of useless, it was like a rock. So it's a very interesting
experience to think about, like the successive layers
of what really matters. The first one being that ability to
run arbitrary code to generate more or less anything that a human can imagine. And then the ability to
put all of those together. And I think that was like the thing
that has guided my career ever since, is the exploration of that idea of
computing technology as a means of facilitating human interaction. >> It's amazing. So, that's what drew you to
technology initially, but you actually studied philosophy. So what inspired that decision? >> I really wanted to do
a degree in cognitive science, but the school that I went to
didn't have cognitive science. So, cognitive science is usually computer
science, psychology, linguistics, and psychology. And so
I wanted to take courses in all four. To do an honors degree in Psychology
was like every single course was a requirement. In fact, you had to do extra. Where as philosophy,
it's pretty light set of requirements, even to do an honors degree,
so I chose philosophy. Literally like that,
it was like of those four, the one that had the fewest requirements. But after I started studying it,
even though I suck is really a philosophy of mine is really interested in
neuro psych as an undergrad. The fundamentals of philosophy
I found super fascinating and this sounds bad and it is bad in one
sense and it's good in another sense. So you think about the last
2,500 years of kind of the history of inquiry
of all different kinds. At some point, everyone was a philosopher. If you were interested in the world in a religious way like the beginnings
of science, philosophy. At some point, mathematics, geometry, astronomy split off over
the next many hundred years. Things like biology in the 19th century
split off into its own discipline and psychology, anthropology, sociology,
computer science, linguistics, women's studies. Until all you had left was an area
of inquiry that is not directed at anything except for
like itself and language. So in one sense, it's really boring. So, if you didn't ever study philosophy,
and you pick up a book of contemporary Anglo American analytic philosophy,
it is super, super boring. It's almost impenetrable
without this giant vocabulary of ways you're going to get into it. But once you're into it,
I still find it really fascinating, because there's so
many unanswerable questions, yeah. >> That's good to know, so who was
the most influential philosopher to you? >> I have a pretty broad range and
I liked all kinds of thinkers but like go back to Aristotle, Spinoza, more
contemporary, Klein and Donald Davidson. But if there's one, it was Decker because
that's why I ended up going to Cambridge. >> Amazing, amazing. So we're in 1997 now. You're armed with two philosophy degrees
and a name for philosopher, Butterfield. But you decided to become a web developer. What led you back into technology? >> Well, so like I said, I got to college
in 92, which, is like, at least for my awareness, six months to maybe
a year before the web really took off. I think Mosaic had been invented,
but wasn't really widely deployed. So the Internet was email, IRC,
a Unix program called Talk. More than anything else, it was Usenet. And that meant that as soon as
the web became a popular medium, that started supplanting things
like Gopher and Ways, I was there. And it was really, the HTML back
then was just dead simple, so very easy to teach ourselves. So 93, I was, I don't know, one of five
people in my hometown who knew HTML. Which meant that 94, 95, 96,
every year, my summer job, but also just my job during the school
year was making websites for people who didn't know how to make
websites because pretty much no one did. And it was like 98, I finished my
masters and was enrolled in PhD. And it was the beginning. So a friend of mine had just
finished his PhD in philosophy. And went to a great school and
did great thesis work and was really at the top of the range and got his first job which was at
the University of Louisville in Kentucky. And he really did not want to live
in Kentucky and it was a crappy job with low pay and it is sessional
position so it renews every nine months. I thought of how many hoops I had to
jump through just to get to that point. Or because it was 98, and the .com thing
started to take off, and I knew the web, and all of my friends who are early web
people were moving to San Francisco and getting jobs that paid two or
three times as much. And it was exciting and dynamic and
were changing the world. So I had an advice from a couple of
professors over the course of my career who were essentially were this
is a terrible life please don't become an academic. If you're interested in this stuff, you can subscribe to the journals and
attend the conferences. >> [LAUGH]
>> You don't have to actually do a PhD and then go be a professor. I took that advice. >> Okay, [LAUGH] that's good to know. So I'm actually curious, raise your
hand if you have a humanities degree. Okay, keep your hand raised if you're
considering a career in technology. Okay, so my question there is,
what were the advantages and disadvantages in having a humanities
degree within the technology industry? >> It's tough because there's
multiple technology industries. So I would say, when I started in 98,
the web was tech, but it was populated much more by people with
a background in like graphic design or architecture if you're
making web development. This serious back end programmers had a
parallel track to web server development. But it was really like a totally
different era and there wasn't anything in between the architects
and the graphic designers on one side. And the people, this won't be a familiar
reference to many of you, but the people are using web logic and
ATG, Dynamo, and these like from today's
contemporary perspective, kind of really horrible
application servers, that had a fundamentally different
approach to doing web development. It was stateful applications,
things like Enterprise JavaBeans. And so I don't think it really made any
difference, what your background was, at that point. It could have been history could have
been finance could have been physics. And meanwhile, there's a different
technology injury which is like all of the descendants
of Fairchild Semiconductor and Intel HP and a bunch of companies
that were native to this area. But that was completely different. Like, the design of circuit boards and
processors and manufacturing computers was
totally unrelated to the web. And still today,
I think we say tech industry broadly. I think mostly what people mean
is at least around the Bay Area is companies that receive EC backing
as opposed to anything else. They're not necessarily
specifically technology companies. And the side effect of
software eating the world, in the famous phrase, is that every
company's a technology company. So you can look at, I don't know,
Visa or Mastercard probably employ close to an order of magnitude
more software developers than Stripe. Everyone would say Stripe
as a technology company, is PayPal a financial services company or
a tech company? Is Airbnb a tech company or
a hospitality company? It really becomes increasingly
hard to make that distinction, unless you mean like technology is
Huawei making 5G antenna chips, and it's Dell, and
then software businesses, like. >> Yeah, thank you for that. So you worked as a web designer for a few
years before starting a video game company and launching your first video game,
Game Neverending. What was your vision for that game? >> So, when you said 92 the thing that was most interesting to me
about the Internet was Usenet. Usenet is a,
those of you who don't know it, a hierarchical directory of newsgroups and
it covered more or less everything. So, they began with the three letter
Abbreviations, so SCI was science, and there was science, physics,
and geology, and so on. And then Rak, rack.music.gdad,
Grateful Dead was, in 92, the Netflix of its time
in the sense that it used more bandwidth than any other
single thing on the Internet. There's so much traffic of
people discussing Grateful Dead, that it kind of surpass everything else. So 93, I guess,
probably a year later, I had the first experience of having a crush on
someone that I had never actually met, it was just from her online persona, her sig
files, the things she said in comments. And that the idea that that kind
of connection was possible, I mean at this really early stage but
it's very interesting to me. You go forward to 98, 99,
2000, and people had blogs, they were the early social networks
like Six Degrees, and then Friendster was probably 2002-ish,
around there. But people had started kind of developing
a persona and having interactions with other people over the Internet in a bunch
of different virtual communities. Some of those are really explicit, like the wells are, like more the ancient
ones but bulletin board systems, discussion boards moves kind of
like interactive chat based games. And I mean I said earlier that the idea of social interaction mediated
by computing technology like the new possibilities that opens up was the thing
that is really fascinating to me. So when you say game, I think people have
the assumption that there's puzzle games, and there's shooting games, and
there's sports games, and stuff like that. This was none of those and this was just
play as a pretext for social attraction, so this is a description that may or
may not have appeal to some of you. I will tell you that it does not
have broad commercial appeal. >> [LAUGH]
>> And that's just like a whimsical world of absurdist humor and
kind of hopefully, delightful little things to discover. But it's mostly like a venue for
people to interact into and to form community with one another. And super popular among the small
group of people from we developed this prototype and we're testing it,
but that was 2002. So some of you are probably were
just little babies in 2002, but there was the dot-com crash
which started in 2000, there was the WorldCom, and
Enron accounting scandals, there was 9/11. It was just like a really dark time for
financial markets, the Nasdaq was down, I think, 80 or 85%, from its peak,
so the S&P 500 was down 65%. It's kind of hard to imagine,
even in comparison to 2008, so no one wanted to invest in
Internet stuff period, but definitely no one wanted to invest in
web based massively multiplayer games, that was just as frivolous
as you could possibly be. Which meant that no one
would invest in us and we didn't have enough money to finish it. And we tried to cast around for something that we could do with the
technology that we developed that would create a commercially viable product
that turned out to be Flickr. >> Yeah, so ironically,
Game Neverending did end. >> Yep. >> So [LAUGH] how did you feel when you
realized you had to shut down the game? >> Horrible, but at the same time,
that kind of happened, but we were developing Flickr and the games
side-by-side for a couple of months. The decision to make Flickr and then its launch, three months,
separating those happened pretty quickly. But in that case, it felt like it was, there's a path forward,
the team got to stay together. We had disappointed a lot of
people who were playing it, but also a lot of them are like, but
cool, Flickr is interesting too and they just kind of migrated,
so that wasn't that bad. >> It's good, so you realize you
have to shut down a game, but not before flying to one last
video game conference in New York. What happens next? >> So it's a conference on law and
virtual worlds, and it's in New York, and flew from Vancouver
where I was living. And got food poisoning on the flight and I
don't want to get too vivid, but it's just like puking in the immigration hall at
JFK, puking in the cab on the freeway. Get to the hotel and step out of
the cab and puke all over the carpet, [LAUGH] so it's all right, a little vivid. >> [LAUGH]
>> I couldn't keep down anything, like ginger ale, water. And that night at like 3 in the morning
after being up with kind of feverish and frantic, wrote out the whole
first version of flicker, what it would be and how would take
advantage of those technologies. I will say this though that was the very first version which
was very different than one and ended up becoming It was not actually
very good That got us got us going. >> So I've am yet to have a battle
with food poisoning be so productive. So kudos to you there. You decided to focus on flicker
When you made that shift, did everyone on your team buy in
immediately or what was that process like? >> No so
I'm pretty democratic leader sometimes. [LAUGH] Maybe less so now than back then. But we had a vote and there was a tie and
I was like [SOUND] so I called. Erik Costello was actually one of
the founders of slack as well. And just like this and background lobbying
to get him to change his vote, so that we could go ahead with it. There's definitely like there's people
who are still interested in making the game and felt like it was
a shame to leave it behind. It was also I think, in terms of the
number of people online, way too early and the technology that was
available way too early. Like I think people forget 2002 was
the first year that any country that more than 50% internet penetration
at home and that was the Netherlands. So, and even then that was almost
all dialogue connectivity. So most Americans didn't
have Internet access. If they did, it wasn't working. It was very kind of narrowly prescribed. And if they did anything online,
it was like maybe check sports stores and stock prices or something like that. So there wasn't really a market for it. But, I just like making software
just in the same way that I did When I was seven years old and I think
everyone else on the team did too, so we just got to make
a different kind of software. And in the end it was, the game was,
play as a pretext for social interaction. Flickr was photography as a pretext for social interaction, is the first, actually
one of the, we got bought by Yahoo and one of the designers there called it,
massively multiplayer photo-sharing. Which I thought was pretty accurate
because it was our first Thing, other than websites that
I heard about later. Where you can put a photo online and
people can see it, and comment on it and have a title and description and
you can tag it and create groups and all that kind of stuff. So it was a social network that
revolved around photographs. I think we started right around
the same time as Facebook, when Facebook was still just in Harvard
for another six months or a year, and then just Ivys for
another close to a year after that. >> Cool, so not to spoil the story, but you eventually sell Flickr to Yahoo for
excess of $20 million. I'm curious, looking back now as you're
leading Slack what lessons from your time at Flickr have been most influential
on the leader that you are today? >> It's hard to say because it was so
long ago. We started development in 2003,
launched in 2004, and then The summer inside the winter break 2004
2005 there's this big Decision about whether we're going to take VC funding or
we're going to get bought by Yahoo. So it was 2005 to 2008 and
I was there, and there's definitely not something
that stands out like the thing that I learned there other than how
hard it is to get something done or how hard it is,
I mean me that's that is a good lesson, how hard it is to get something done
in an organization of that size. Yeah, it was about 12,000 people. And I think there's a couple things that
were wrong with it at that time, but the biggest one was it had
basically stopped growing. And in an environment where the pie isn't
growing anymore, suddenly the kind of game theoretic, the calculus, especially
among executives is very zero sum. So it was like people battling
each other internally. We even forget that for a second,
any company of any organization of 10,000 people and it requires such
an extraordinary injection of a will to make anything happen that most things
are for all practical purposes impossible. >> Okay, so we fast forward to 2012,
you have left Yahoo, which by the way, if you have not read Seward's resignation
letter from Yahoo, please Google it. He likens himself to attend Smith or
named Brad, it's quite hilarious. Since 2012, you're starting another video
game company this time, Tiny Speck. At Tiny Speck,
you launched a game called Glitch, what gave you more confidence in
the gaming area this time around? >> So it's 2009 that we started the
company, and 2012 is when we shut it down. But it's the same group of people,
[INAUDIBLE] the four of us who had worked at Flicker, and
we all worked at Yahoo together. But 2002 to 2009 was pretty amazing
time in the history of the Internet, and suddenly everyone had Internet access. And there were phones that were capable
of Internet access, Blackberries and Trios, there were a lot of people had
high speed Internet by that time. The world of open source software
specifically to support development on the Internet we had just exploded, so there was really not
much available in 2002. But by 2009, we had a very robust mature, Apache foundation, and all of these
great networking technologies, people's computers are much faster,
and there's many more people online. We were much more experienced,
it was very easy to raise money. If you just like look at any factor in
a giant matrix of like things that would lead this to be a good plan or
to be successful. We had shifted from a two out of ten,
to an eight, nine or ten out of ten, except that that idea was still
not very commercially viable. [LAUGH] Same idea, like better graphics. >> [LAUGH]
>> Do you think that idea is ever going to be commercially viable? >> Well, I mean, so we could have kept
going and paid all of our salaries and been happy, and it would have been
interesting but we had taken, by that point, $17 million in VC money. So I felt like it would have been
an aberration of the responsibility, that kind of contract we made
with them to just do that, so we had to think of something else. >> So you said 17 and a half million, and funding you had around 45
employees around the time? So you find yourself in
a familiar situation and you have to shut down that game again, what was the toughest part about that
decision the second time around? >> So the second time around, it was very
different because it wasn't just, hey, everyone, we are now as a group and
a switch working on because there was animators, and musicians, and writers,
and illustrators, level designers. A whole bunch of people who just didn't
have skills that were transferable to so a lot of people were going to get
laid off, I think there was 35. And in the three and a half years that
we had been running the various versions of Glitch, there wasn't like pretty
strong and very active, robust community. There wasn't like a couple hundred
people who tested Game Neverending, you could just start using Flickr,
they were going to disappear. And I think this is a hard
thing to relate to or understand if you haven't gone through it,
and it's maybe something that hasn't happened in
a long time and might not happen again. Like Tumblr seems like the last platform
that had close communities like that, whereas now, everything, like Instagram
is just one world connected, so Facebook is another world,
Twitter is like everyone. And there are definitely, sub communities. But when communities exist in
a one specific platform, and that platform disappears, it is a little
bit like that moment in the first Star Wars when Alderaan gets blown up. Like it is just that society,
that little culture, those relationships just will not exist anymore,
so it is really like that was very sad. But obviously for me, first of all, it is
embarrassing, I did all this press and made all these claims, I had to
convince all these people to come and anytime you got new press it was
I had to convince them I'd do it. Every time I got investment,
I had to convince them to do it, but more than anything else I had to convince
all these people to come work on this. And I followed that story many times but the day that I made
the announcement internally called this all hands, some people already
a little bit apprehensive because we've been through a couple of different like,
here's the last thing we're going to try. There's wasn't a day when
we normally had no hands. And I locked eyes with someone as soon
as they started talking, who two or three months before I had convinced to
move to a new city with his wife and two-year-old daughter away
from where his in-laws lived. Their in-laws were hoping to take care
of the kid, he moved to the city, bought a house, and I was going to tell
him that he didn't have a job anymore. Those are really, really, really hard,
I mean I think that that's a, like the impact on me reputationally or
financially was, in the grand scheme of things, relatively insignificant,
I haven't just bounce back again. But that's more than just disappointing
someone like I was going to come meet you for dinner and I bailed at
the last minute or something like that, this is like I convince you to
alter the course of your life in a really significant way and
then didn't It didn't happen. So that was very, very difficult, in
the end knew like a little bit of positive news because we had five and
a half million dollars left of that money. We're able to shut down in
a relatively elegant way, so we made a portfolio site
which had everyone's resumes and did a bunch of reference letter writing
and kind of career coaching and. Helps get everyone a job, in most cases a better job than they
had when they were working for us. And we were able to give customers
the choice of their money back where we could donate it to charity or
whatever, but and that one person, Tim Leffler,
ended up joining slop bucket a year later. So that part all worked out too, but
doesn't mitigate at all like what it felt like in that moment,
it was really pretty terrible. >> That's pretty heavy, so
how do you go from that terrible moment to launching Slack which reached
a billion dollar valuation in record setting pace of eight months? >> That worked out super well [INAUDIBLE]. >> [LAUGH]
>> We had developed a system that was the proto-Slack. Again, 92,
I mentioned that one of the software network tools that I used was
called IRC or Internet Relay Chat. And we used IRC at the company that made
Glitch, and it's a very old technology. So it's With most messaging systems,
and probably every messaging system you've ever used, there's a concept
of what's called store and forward. And if I want to send a message to you but
I can't reach you right now, there's no connection to your endpoint,
your client or your device, it will just be held and then forwarded
to you the next time you connect. But IRC didn't have that. If you weren't connected at
the moment that I sent the message, you would just never receive it. So we built the system
to log the messages. But once we had
the messages in a database, we wanted to be able to search them. So we built search on top of that. And then bit by bit,
kind of feature by feature, we built things to integrate
with our file server. So when someone uploaded a file,
it would get announced in the IRC or if an alert went off in our data center,
then that would get put into IRC. And slowly we developed the system which
was really the foundation of all of the ways in which the company communicated
and was really beneficial until we realized none of us are ever going to work
without something like this ever again. Other teams of [INAUDIBLE] software
developers would probably like it as well, and so
we decided that's what we're going to do. And we thought that one day
in the fullness of time, if we had every single person
who could possibly use this, we would have a $100 million in revenue
and thereby be a billion dollar company. And that just happened very quickly. >> [LAUGH]
>> Yeah, I definitely think the math checks out. So at Slack, you created a product that
not a lot of companies knew they needed. How did you convince them otherwise? >> That was tough, the first first three
or four external teams to use Slack. It took dozens of tries like going
to their office and showing them. And I think we learned a lot there about, Marketing probably isn't the right term. And I think we actually had this problem
a little bit with Flickr because Facebook came out and just stole the social photo
sharing market while Flickr was trying to decide whether it wanted to be social
photo sharing or a community for people who are interested in photography. But if you can't explain what you're doing
well enough that someone to whom you explain it can go on to explain it to
someone else, then it's a real problem. because otherwise, you're going to
have to do all the explaining. So we struggled to figure out the way to
talk about it, what advantages it had, what it was for. But when it's net new and
it's not replacing something else, it's very difficult. I don't know if it's still frequently
read but there's a classic book in marketing called Positioning,
Jack Trout and Al Ries I think. And one of things they talked about is if
something is a new concept for you, it's almost impossible for you to get purchased
in somebody's brain, in somebody's mind. You have to find something else
that already exists there and then alter that idea,
which is why you hear Uber for whatever. Because if you had to explain
the whole thing from scratch, it's just very difficult. It's why you hear movie pitches
that are Jaws meets Star Wars or something like that. >> [LAUGH]
>> And it's much easier to get that
than to start from from scratch. But it was like it was a real slog
to get anyone to even try it. And the encouraging thing was
once people started trying it, they almost invariably stuck with it. They've logged in every day,
became like it was for us the foundation of
how they communicated. >> And so from 2014 to 2017,
there was limited competitors for Slack given that it was
such an innovative idea. But in 2017, when Slack had
more than 100 million revenue, which you predicted 650 employees and evaluation of around $5 billion,
Microsoft launched their team's app. How did you feel when you found
out that app was coming out? >> I think mostly just good
because it validated the idea and we had some advanced notice
that it was coming out. because we've worked with Microsoft
on something, like early stuff with Microsoft research on building
question answering box for first lock. And had a pretty good relationship with a
guy named Qi Lu who was a software exec at Yahoo, who was the CTO of Microsoft. Left around them to go
be to take over Baidu. But we weren't especially worried
just because when it was, before it was first announced,
it was called Skype teams and had a pretty different approach and
was just so far behind us from a product perspective that we weren't
worried about people switching. >> Okay, so now in 2020, how do you
feel about Microsoft's Team app? >> Well, it got a lot better
as Microsoft [INAUDIBLE]. >> [LAUGH]
>> I think there is a bunch of things that, That make it much more of
a challenge for us today than it was then. And it's not just that it's better
because it's actually not better enough compared to how it was that any of our
large customers could switch to it. Our biggest single user is IBM, somewhere close to 300,000 daily active
users over 10,000 workspaces and Teams is limited to 5,000 users per workspace and
you can't federate them together. So there'd just be no way to support
that Structures and what didn't work for them and
there's many other things that are very, very fundamental limitations
over 5,000 people. You can have 200 channels and
if you want to add the 200 first, you have to add,
delete one with all of the messages, but none of that really matters in
the face of if you want to be able to collaborate on the word doc with
track changes send it back and forth. You're lawyers working on a contract or marketing people working
on a press release and you are an Office 365 customer,
you more or less have to use Teams now. And the 100 million users of Skype for
Business are being migrated over to the Teams because Skype for
Business is being shut down. So there's a bunch of things
that are kind of force it but maybe most fundamental
is we have 12 million. I don't even remember what our public
number is on daily active users. 12?
Yeah, okay, so- >> [LAUGH] >> 12 million and there's at least 200 million people for
whom FAQ or something like it is
the preferred way to work so 200 million people whose working
lives are mediated by email. And they are moving over
I think is inevitable. So that's 6% which means 94%
of people don't use it yet. And if you don't use it and
you don't have any idea and and you hear that there's two alternatives,
one's Slack and one's Teams. And because you're an Office 65 customer,
Teams is already free and integrated with all of
your Microsoft tools. Then why would you even evaluate Slack? Or Microsoft was aggressive in a way
that I think was surprising to a lot of people even who watched that company
closely, like putting out a press release with our daily active users in it during
our quiet period, post the listing. But if they can put out a press
release in tank or share price, and you're not watching this stuff very
closely, you don't have a fighting degree of resolution, then you might think as
a customer, why would I invest in Slack? They're just going to be out
of business in three years. Microsoft's going to inevitably kill them. That doesn't, it would be a waste
of my time to even look at it. And it's not like at that point, the fact
that they are different really matters to you because you don't use either and
it's not really replacing anything. So it's much more of a threat now. I think we underestimated
the degree of importance. The Financial Times Person of
the Year was Satya Nadella. And so there's a big write-up of that. And there's six consecutive paragraphs
that are about Slack and there's no other, maybe the names of some competitor
companies are mentioned in one sentence. Here and there, but
like it's the biggest chunk of it. And so, I think that's because of
all the things that can be used as leverage by Microsoft to expand
relationships inside our businesses. Exchange, the email server, and
the fact that people are very used to Outlook is like the principle
one that kind of gets them in. And that makes it difficult for
people to switch. And if people stop paying
attention to email, if email declines in relative importance
compared to other software we use, that's a really difficult position for
them. So from their perspective, I think, and this is what she knew we
thought back like 2016. This is in fact, successful to the maximum extent that's
an existential threat to Microsoft. But I don't think that's
actually true because so many other things would change in
the world on the path to that. But I think that is a thought process. >> So, despite selling out and
actually becoming a consultant, I studied mechanical
engineering in undergrad. And as a black engineer, I really
appreciate what Slack has been doing from the perspective of diversity and
inclusion. Back in 2015, Slack shared a diversity
report which revealed that most of their black employees were in technical roles,
contrasted with a lot of companies that will hire black individuals
primarily into administrative roles. And in that same report,
45% of managers were females. So to a room full of individuals who
will start companies or be at companies, what advice you have for
creating diverse workplaces? >> Start early,
I think that's the biggest thing. When we were 20 employees, I would say, between 20 and 30 maybe. Wow, there's a lot of white dudes. >> [LAUGH]
>> And in that case, it wasn't too late, but
it was close to too late. It was like more of a slog to get started. Because what happened was,
we have one black woman engineer, and then another one comes to interview and
she sees the first one. And suddenly it's like a completely
different assessment of what's going on here, and then there's two. And then the third one comes for
interview, if feels like there's community, and
people talk, and have a network. So, getting started early I think
is the most important thing. I think it can be a kind of
a fraught topic I think for people. People aren't sure what to say or
they're uncomfortable. And I think there is
a really pervasive and incorrect belief that you
would have to lower the bar to hire someone who isn't
the canonical candidate, the archetypal candidate for this role. I think that's usually not the truth for
two reasons. One is, you just have to look harder,
you're going to see more people. And in fact, that can raise the bar. But people have different
challenges in their life, and I don't think you can perfectly
understand someone's background just from their gender identity,
or their ethnicity. But on the whole, for
a woman to get to a certain place in her career,
they had to work a lot harder than a man. For a black engineer to get to
a certain place in his or her career, they had to work a lot harder than,
this is where it gets fraught. In Ben Horowitz's words, Jewish, Chinese,
or Indian guys in Silicon Valley because there's just like these networks
that are very powerful. And you have an enormous advantage. So for
two people with equivalent credentials, the person who's probably going to
be more talented, more capable, and had to overcome more obstacles to get to
where they are is going to be the one who doesn't have the traditional
archetypal presentation. >> It's amazing.
Thank you for sharing that, I'm sure, I hope people were taking notes. >> [LAUGH]
>> So we've gone through
the journey of your career. You started as a web developer. You founded a company that
was acquired by Yahoo. You launched a second company that raised
more than $1.2 billion in venture funding, and you eventually took
that company public. You've been a leader
throughout this entire time. What has changed about your leadership
style and what stayed the same? >> [INAUDIBLE] It's always hard
to really assess yourself. I think I'm relatively self aware even
of those things that don't work and it doesn't matter that I
know that they don't work. I still can't change them. But there is a difference in the mechanics of being a leader at different scales. Because when it's 20 people and
we all kind of know each other, it's very different. I say something and
then we argue about it, and maybe I change my mind, and it's all good. There's a power dynamic where
I'm the CEO and whoever, and everyone else is not the CEO. But when you get to 500 people or
1,000 people, where we're at now, a couple of thousand people,
it's very different. Someone's going to come
into your presentation for some new product development. And it's like a relatively new designer or
engineer, or product manager you've never met before. To me, this is just like a one more
30-minute meeting in my schedule, which is [SOUND]. And for them, this is something
they've been thinking about for weeks. They probably talked to their spouse
about it, and they're either excited or they're nervous, they want to know. So the degree of impact
that my words have is like, from the perspective of me, crazy out of proportion
to the amount of action. So in other words, it's like a super, super powerful microphone
on at all the time. So if anything's negative or critical,
if I have a relationship with someone that I've worked together for
a long time, it's not really a big deal. If it's someone that, that might be the
only time they interact with me ever in their whole career at Slack. Or it might be the first interaction
they've ever had with me, and they might not have another one for
several years. It carries a huge amount of weight. So it's hard because,
is that the amount of time we have like, including questions from everyone? >> That is. >> Okay. >> [LAUGH]
>> I'll try and be a little bit more concise. >> [LAUGH]
>> I remember reading on Twitter people
arguing about Warren's tax plan. And someone said something like,
if Dwayne The Rock Johnson just paid this tax at this rate,
then we'd have an extra $50 million. And then that's how much it would
cost to solve the water crisis. And it struck me as just
a totally absurd argument because federal budget is something
like $2.7 trillion. So 50 million bucks plus or minus is not
the reason why that doesn't get solved. It doesn't get solved for
all kinds of reasons. And people think that way all the time,
that it's just like money or it's just resources. For anything significant to happen, certainly anything that involves dozens of
people, let alone hundreds or thousands. The amount of will that has to go in,
the amount of like selling, the amount of vision, the amount
of like coercion and cajoling, and the amount of encouragement, and support. All of those things is just enormous. So, the game does change as the company
gets bigger and things evolve. And I think probably only
gets more difficult, but. That's what I've been
learning this whole time is how to do that without
like crushing people. How to do that without creating an environment where it's entirely
top down like iron fist from above. And it can be tough
because I have a different perspective than anyone else
because I see everything. So I talked to someone in engineering,
I get a head of sales reports to me, head of marketing reports to me,
head of finance reports to me, our general counsel reports to me. So I have a very different perspective
than what is ultimately relatively narrow. And generally,
a better idea of what we need to do. because I also talk to customers more
than pretty much anyone else other than the sales person. And I talk to our investors
more than anyone else. And I talk to our board
more than anyone else. Yeah, it's really, but I think there are better sources
than me for like top ten tips. Because none of them
seem that simple to me. And it's not that they're not out there,
but the real challenge of leadership and maybe there's one book I would recommend,
which is Leadership and Self-Deception. The real fundamental challenge of
leadership is the same as the fundamental challenge of just being a human being. And I think that's, This will
sound a little bit weird, perhaps. But living with an open heart and
not seeing other people as, on one hand, either instruments that can
be used to your advantage or obstacles that are in the way of
something that you're trying to do. Which is the default judgement of all people with whom you are not
close instinctually. So like you're on a Southwest flight and
people are still boarding and the middle seat between you isn't taken. And you're like, please don't take this
seat, please don't take this seat, please don't take this seat. A person has a whole life and
their own ambitions and desires and heartaches and
stuff like that. But to you, in that moment, they're just a potential pain in the ass that might
take the middle seat next to you. And that's pervasive, and when you're
really trying to accomplish something, it can be very tempting to see people
as either instruments or obstacles. >> Amazing, so we're going to go to the
audience for, we probably have time for about two questions. So? >> Hi, Stuart. Really appreciate your
comments on diversity, so it makes me feel better about
my Stanford Slack addiction. >> [LAUGH]
>> My question is, what were some of the key and
best things you did on the product and design front in the early days of Slack? So for example, how much of Slack's
success do you attribute to your personal eye for design, versus hiring the best
designers, versus feature prioritization, or even just the insight
about having a personality? Curious what advice you'd share there for
aspiring entrepreneurs. >> Yeah, so I'm not sure I want it like
slice it up by who gets more credit. But I think the fundamental approach was how much easier can we
make people's lives. And when I look at other products,
it's really, I'm trying to think of the shortest
version of this I can. It can be an amazing app, and if
the password reset thing doesn't work, and I need to reset my password to use it,
then I'm just locked out. So there's very basic, fundamental
things that you have to get right, and which aren't the interesting ones. In fact, someone Tweeted something
the other day which I liked that kind of illustrates this from
a different perspective. And it's someone asking Ray Kroc,
the kind of founder and the first CEO of McDonald's,
why was McDonald's so successful? And he says, because we have clean
bathrooms, and they say, that's easy. That's so simple. That doesn't explain it. And Ray Kroc said,
are your bathrooms clean? And it actually is like a challenge. So there's some real fundamentals. But the things that we did that were most
successful were those things which made life more convenient for people. And one of those was for example, typing
your password on your phone is a pain, so we'll send you a magic
link that logs you in. Or because for complex reasons, most
people wanted to have notifications for every message in Slack
when they first signed up. So they felt comfortable and
knew how it worked. But we didn't think
that was a good way for them to set their preferences long-term. After a few notifications,
we would interject and say, would you like to switch
to our preferred settings? And that kind of thoughtfulness or
consideration, that kind of thinking of
yourself as a host and the customers as your guests,
is the secret, as it were, to good design. >> And we have time for one more question. >> Can you hear me? >> Yeah. >> Thank you so much for
taking the time to speak with us today. So in your answers, it was really clear
that like, what you've been interested in is kind of facilitating communication
through different mediums. Whether it be video games,
photography, now Slack. Was that understanding clear
to you through your journey? And if not, was there like an aha
moment that you realized this was what the issue you really
wanted to work on was? >> Yeah, well, so
the desire was there, but I didn't think I recognized
it as one single thing. because Slack is also a massively
multiplayer workplace software. I mean, that's kind of the principal
distinction between Slack and pretty much every other tool. And it is very much like
the games that we wanted to play. You take objects and
you can manipulate them and distribute them and
form groups and all of that. But I don't really recognize them as being
fundamentally similar until much later. The thing that I thought as being the
common thread was just it's all software. And software that groups of people use
together to me is the most interesting type of challenges,
because it has all the regular challenges of scalability on the one hand and
design and usability and the other. But social dynamics because of
the feedback loop where the output of the system can also be an input
to the system are much more difficult to design for and
therefore much more interesting. >> Amazing, thank you all for
the questions. Dharma-
>> Yeah. >> It's been a pleasure chatting with you. >> [LAUGH]
>> It's not often that we get time with a classically trained philospher. So I have a new spin on our
typical lightning round. I'm going to ask you a few
questions that keep me up at night. Is that okay?
>> Yeah. >> Cool. >> [LAUGH]
>> So we'll start with an easy one, is water wet? >> Yes. >> [LAUGH]
>> Okay, if soap hits the floor, is the floor clean or is the soap dirty? >> Soap's dirty. >> Yeah. >> [LAUGH]
>> Dirty soap, all right. I have to make sure I pronounce
this one the right way. >> All right. >> Does expecting the unexpected
make the unexpected expected? >> No. >> No, we're going with no? >> Yeah.
>> Okay, final one, you're ready? >> Yeah.
>> One word or less. >> [LAUGH]
>> What is the meaning of life? >> I thought the question was one word or
less. >> [LAUGH]
>> For those of you who read Douglas Hofstader, if you're familiar with the history
of Buddhism, I'll say mu. >> Mu? >> Yeah. >> We have a minute and 20 seconds left. >> [LAUGH]
>> So I would love to hear more. >> It's funny. >> [LAUGH]
>> [LAUGH] When I said before, contemporary Anglo-American philosophy
is really boring on the one hand. And you take away all the subject matter, there's an enormous corpus of research and
argument and even books written. But certainly like thousands
of papers on the question of, do holes exist, like H-O-L-E. Like is there such a thing as a hole,
or is that the absence of something? And I swear that is a giant argument. So, I find it easier just to come
down on the side of one or the other. The meaning of life, I don't know,
to love one another. >> Okay, I like that one. Ladies and gentlemen, Stuart. >> [APPLAUSE]
>> Thank you. [MUSIC]
