Drew Banin On Building A $4 Billion Business By Helping Analysts Create And Disseminate Organizational Knowledge

The visionary story of dbt Labs, formerly known as Fishtown Analytics, is a tale of remarkable innovation, growth, and adaptability. Founded by Drew Banin with a passion for data and a desire to make data teams an essential part of every organization, dbt Labs has been leading the charge in data transformation.

The venture hs attracted funding from top-tier investors like Amplify Partners, Sequoia Capital, Coatue, Tiger Global, and Andreessen Horowitz.

In this episode, you will learn:

• dbt Labs’ beginnings and growth
• How they emphasize customer collaboration
• Their mission of enabling effective teamwork
• Aligning product with vision and adapting to platform shifts
• Reflections on venture capital and the timing
• The future of dbt Labs and its impact on data transformation

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About Drew Banin:

Drew is a co-founder at dbt Labs and an open-source maintainer of dbt (data build tool). He’s built event collection systems that scaled to billions of events per month, implemented Markov-based marketing attribution models on millions of dollars of marketing spend, and dreams in NetworkX graphs.

Connect with Drew Banin:

• Crunchbase
• LinkedIn
• TheOrg
• Zoominfo

Read the Full Transcription of the Interview:

Alejandro Cremades: Already hello everyone and welcome to the deal maker show. So today. We have a very exciting founder. You know a founder that obviously you know like very very product driven. You know we’re gonna be learning quite a bit you know from his thinking you know from the way that he thinks about scaling you know as well. I they my god you know they’re on this rocket ship. You know they’ve raised 400000000 plus you know they’re making a killing. But again you know super inspiring journey and I’m sure that you’re all gonna love you know, hearing his story so without farther ado let’s welcome our guest today Drew Bannon welcome to the show.

Drew Banin: Hey thanks so much for having me on excited to be here.

Alejandro Cremades: So bornen raised in Philly so give us a walk through memory lane I was like growing up.

Drew Banin: Oh gosh. Um, so I grew up in the suburbs of Philadelphia but I think you’re allowed to save Philly if you’re if you’re less than an hour outside um you know it’s pretty typical suburbanite childhood. Um I I got into computers and my teens and um. You know, got into into programming spent a lot of time on. Um, ah oh gosh I can’t remove website. We can cut this part out. But um, anyway, just just spend a lot of time like diging into computers learning about programming technology was always interesting to me and um, when I got to college I ended up going to school in Philadelphia. At a University Called Drexel University and had some like pretty formative experiences in technology there too.

Alejandro Cremades: And I know that you know you got into computers initially because of your dad. So how did that happen.

Drew Banin: Yeah I even remember him bringing home the the old culet packard pc and maybe the early 2000 something like that and like a lot of 90 s kids have fond memories of the Aol you know, dial up sound. Um, but I always like tinkering and and I would. You know play around with their computer and sometimes break it and um, my parents got fed up with that so they ended up taking me to um comp usa I think and we built a computer together from scratch and so that was like my first real like okay I could I could play around with computers I could do this for real I want to spend a lot more time with these going forwards. Um, so that was that was really like the start of me getting into programming having my own computer. Um, and I just really love playing with it and feels like I haven’t stopped over the past ah fifteen years

Alejandro Cremades: And obviously you kept going. You know you went into as you were saying Drex Drexel University did your computer science degree there and then from there you know, basically you became a software engineer but you were a software engineer for different companies before you actually went at it. You know I started your own business. So. So Dennis you know like what were some of the things that you did and and and how did that you know those different experiences change the way that you think about building products.

Drew Banin: Sure so Drexel has a pretty cool undergrad program where they bake um like three different co-op you know internship experiences into your undergrad experience. So the downside is you’re in school for 5 years and you don’t have any summers off but the upshot is that. Get to spend eighteen months out like working full time with with different companies in your field. Um, so you know I did one of these with ah a high frequency stock trading company just outside of Philadelphia I learned a lot about high performance computing and and wrangling tons and tons of data. Um.

Drew Banin: Ah, that was a pretty cool experience as a you know nineteen or twenty year old um and then from there I ended up going over to San Francisco and I worked at ah, a pretty cool internet radio startup called 8 tracks. Um, so at 8 trackx you know I was doing software engineering at first I was working on the website. And we started to do some a b testing and so we didn’t have any onstaff like data analytics folks. So I I built the split tests I instrumented the tracking and then I found myself doing the analytics on the results of the ab tests you know in in redshift which is pretty new at the time. And that was the first time that I really got my hands on a cloud data warehouse I was doing analytics for real and so that kind of planted this bug in my head of well software is cool but writing software on data is even cooler. So I ended up coming back to Philadelphia to finish up school and I did my ah. My other third internship with a company called Rj Metrics in Philadelphia so they were an all in one bi tool. It was sort of like the best in class of the previous generation of data and business intelligence. So you know they would connect to different data sources pull in data generate derive metrics visualize them like the. Full suite of analytics. Um, and then around 2016 you know, red shift came became really popular and we started to see companies like looker and fivetran and mode analytics cropup that all worked with Redshi and you know it was like a ah.

Drew Banin: Better more interactive experience than kind of how this previous generation of b worked and so that was sort of the impetus for for us. So my 2 co-founders Tristan and Connor worked at Rj Mettrics with me tris was actually my boss at at Rj Metrics he’s the Ceo at at Dbt Ops now um that was sort of the the moment where we saw. Okay there’s a new stack emerging and there’s a part of it that is not addressed and that’s the sort of like encoding of business logic or what you might call data transformation piece and so we started building dbt as open source software kind of around that same era to to go and transform data in a way that’s native to. To the cloud data platforms.

Alejandro Cremades: Um, so obviously you know like the um, the team. You know the the band you know, got together. You know as a result of Rj metrics. But but tell us about how was that transition like I mean. How do you all start to think through this. How do you all come together and decide that it’s time to pull the trigger and get going so so walk us through that.

Drew Banin: Yeah, so it started slowly and then proceeded very quickly from there. Um, we started building this thing dbt we we made it open source from the very start I think the big insight was that this business logic is so valuable and we wanted to avoid a situation where. Folks felt like they didn’t own their own logic. We thought that was really important and we we saw open source as being a a good way to do that so we built dbt as open source. We. We put up a github repo and we started a slack channel and you know it’s important to know at this time we had formed a company we were called fishtown analytics I’m actually wearing the. Shirt today fishtown is a neighborhood in Philadelphia where we where we started the company I actually I’m in Fishtown right now. Um, so okay, we set up a slack channel. We have an open source repository and then like nothing really happens for a little bit but Tristan our Ceo was doing a lot of writing about analytics and kind of. The power of cloud data warehouses and this this quantum leap forward and how analytics you know should work and our big insight was that data analytics was the wild west it was like so ungoverned. There were no rules and we looked at software engineering as an analog. And we saw that software engineers have decades of best practices that they follow to to good effect. So the mission for Dbt was to take all of these software engineering best practices and bring them to the data analytics workflow and so that looks like version controlling your code doing code reviews writing automated tests.

Drew Banin: Documenting your code everything that we would expect software engineers on the team to do we sort of built dbt to help data analysts do um so we wrote a lot about that point of view and people started getting sort of magnetically attracted to it because there were a lot of people that looked at Thor they were doing at analytics and thought. Gosh this is this is nuts. It’s hard to reproduce my work things break and I don’t know why until someone tells me that a dashboard’s broken things like that so that was kind of the seed from which this community or on dbt grew and it started. You know we had a slack channel people would just join in. And write in and say hey Dbt is pretty cool. The things you’re saying are resonant and and I like them. There are other people that wrote it and said hey I’m trying to use dvt but I can’t install it on my windows pc can you help me? um and so across the whole spectrum of of people that wanted to be a part of the community people needed help with Dbt people trying to help us. Iterate on features and build new capabilities. Um, these folks all kind of join the the dbt slack community and and we got to know them by name and meet them in person and and that was really this nucleus from which like this you know today the dbt community is 70000 people strong but it all sort of with. With ah 10 or 12 people in ah in slack group.

Alejandro Cremades: That’s Amazing. So So obviously you know for for the people that are listening to I mean you guys really got you know going as um as a consulting gig and and how was that. I mean do you think that that perhaps you know like made it easier because it’s not like you gave your notice and then right away you were going to 0 It’s like you could you know build it you know over time and transition it to into pivoting the product to something that was something more productized versus more service based as you guys got going with this.

Drew Banin: Sure? yeah, you know we always took dbt development seriously and valuable in its own right? But we very much did use it as a part of our analytics consulting and engagements. So we mostly worked as a consultancy we were called. Fishtown analytics in the early days we worked with mostly series a funded companies that never had a a real analytics practice. But now that they had you know investors and board reporting to do they needed to take data more seriously? Um, so we would hook them up with you know a data warehouse. And ah load their data into the data warehouse use Dbt to model it and crank out you know some reports for the most important stuff that they cared about so this could be marketing attribution product analytics things like that you name it um the the fact that we use Dbt. And every single one of these engagements helped us really understand the parts of analytics that varies across companies versus what is consistent across companies. So then we could take those kind of consistent themes and encode them into dbt as like product experiences because if you’re doing analytics at like. Any ecommerce company in the world. You basically care about the same types of things right? There’s like customers. There’s orders. There’s returns and so the specifics around how that data how that data flows and what your logic is okay parts of that vary by company but you can kind of template out the modeling of shopify data.

Drew Banin: Or stripe data or something like that. Um, so we created this like package ecosystem where we would template out data transformations and and help make reporting really easy and in every single engagement we learn more about the sort of limits about ah Dbt and we fed back in insights into like how we should evolve the product to make things easier more efficient. Um, and and more powerful. So yeah, the consulting. You know we did that for from 26 t and until about 2020 the hard part is we wanted to keep developing dbt open source but we needed to do consulting to make money to. Pay ourselves and employee consultants and at 1 point you know we had a software engineer working full time on on dbt open source which we literally could not charge people money for there was no saas product. There was no commercial offering whatsoever. Um. So we did the calculus on you know how many consultants we need the staff to employ one full-time engineer to build open source software and we kind of quickly saw that if we wanted to scale out development of Dbt and and make it bigger and better. We would need to actually go and raise money we couldn’t self-fund that through consulting without having like a 100 person consulting.

Alejandro Cremades: Um, I hear it and and I guess and I guess real quick here for the people that are listening to really get it. What ended up being the business model of Dbt Labs I mean how how do you guys make money.

Drew Banin: Arm which and what to do.

Drew Banin: Oh sure so around 2020 we launched a product called dbt cloud this is a hosted saas product. There’s a self-service component so you sign up swipe a credit card There’s also an enterprise offering that that. Sort of we work with larger companies with more sophisticated security compliance collaboration needs. Um, so that’s where a true product company Sas is is how we make money today.

Alejandro Cremades: Nice and and and tell us about how have you guys gone about the um, the capital racing side of things because you you guys have already raised quite a bit So how has been that experience of going through all these different rounds and and raising that money you know dealing with expectations and.

Alejandro Cremades: And how things you know have shift too because you’ve raised you know pre covid or the macro environment that we’re dealing with today and and yeah, so tell us what has been the journey there.

Drew Banin: Sure you know I can tell you that the process of of raising our series a was an interesting one because we truly did not have a lot of software revenue we have like ah a precursor to DbtCloud ah we we called it center. It was kind of a silly name in rotrospect. But we have like not very much money in recurring revenue but we have like ah a wildly explosive ah growth and adoption of dbt open source so we actually had anonymous. We still have anonymous telemetry and in dbt open source. And we could see how many companies are using dbt basically so we observed that the number of companies using dbt grew about 10% month of a month for about 4 years straight and that was the point in early Twenty Twenty where we thought okay, we have enough confidence that that the market is here and the demand is here. And we should go and and sort of make this investment to to build out a saas offering and and try to become a product company. Um, so you know like the the raising money experience in that environment is hard like it’s it’s more about adoption and energy and passion and tam size than it is about like software revenue. Because we hadn’t really built the true software saas product yet? Um, so that that was an interesting era I personally um, you know this is my first rodeo as a founder and so I was sort of unfamiliar with how to navigate. Um.

Drew Banin: Conversations with vcs and and I was grateful Tristan our Ceo ran point on on sort of all the fundraising which you know makes sense but I remember meeting one of our investors from amplify partners. His name is Lenny I met Lenny in San Francisco for coffee and I went and do it sort of like um naive like oh gosh I’m talking to a Vc. And I met Lenny and and we talked about Seinfeld and data engineering and and hit it off so I’m really fortunate to have such great investors on our team. It’s been ah, it’s been great working with them and the really fantastic thing is that they can share this broader perspective of kind of what’s happening in the market. What’s happening in the portfolio and and help kind of nudge just in the right direction but you know really feel like we’ve got a lot of ah self-determination here for for where we take the product.

Alejandro Cremades: Um, and then how how is it like like when you raise all this money and you know you got all the expectations doing the product and what you need to accomplish I Mean how do you deal with that like crazy you know but growth and scale and. And how do you go about that and how are you guys thinking about that now too.

Drew Banin: Yeah I mean it. It’s important to have high expectations of yourself like if we weren’t motivated. Ah, this is gonna be the most startup foundry thing I’ve ever said. But if we weren’t motivated to wake up in the morning and try to go change the world and no amount of external motivation will will get you there? um. So we’ve always been ah a mission-drive company. You know we talk about um, helping sql like data analysts. Um, let me lawyer on that back actually um, we’ve always been a mission-driven company and we care a lot about empowering you know data practitioners. To create and disseminate organizational ah organizational knowledge so this feels important to me personally because I think the data analyst you know the person that can span the technical context and the domain context should be 1 of those people really empowered to help make decisions and drive a company forwards. Um, I’ve seen examples of you know technologists that kind of lack the broader business context um make call it ah suboptimal decisions I’ve seen the opposite you know folks that that only get the domain but can’t understand the technology have a hard time really wrangling the. The the tech and moving and having a big impact so it’s those people right in the middle of the technology and the and the domain knowledge. Um, that are so well-positioned to have each impact and and we see dbt as being a tool to help them maximize their impact. Um, so when you start with that mission and you care a lot about it and you’re driven by it.

Drew Banin: You know the ah the other expectations that come with raising money being venture backed um those feel more like tools that we have in our tool belt to help achieve the mission rather than anything else.

Alejandro Cremades: Um, and also what about product leadership. How do you think about the team to to make sure that you guys can you know push things forward.

Drew Banin: Yeah, you know it’s been really interesting. Um, as we’ve grown. Yeah, we’ve gotten different inputs from people. So I talked about when there were 10 people in dvt slack and from 2016 to 2018 or 2019 but people that were coming and talking to us and that we reached out to were power users with power user types of concerns. So sometimes they were 1 ne-person data teams and they had to do it all themselves and and they had a certain perspective at a certain set of needs and wants and and goals and you you know as we grow and and we work with these. Um, amazing enterprise companies doing like really powerful things across huge data teams like hundreds of people thousands of people. They have very different sets of needs and so I personally find it valuable to make sure that I’m getting all of those inputs because if you’re only listening to the power users. You only kind of get one set of concerns. If you only talk to the people in a 5000 person data company a data team. Um, that might be too big say the thousand person data team. You get a different set of concerns. But if you look at it holistically then you can build a product that really like is horizontal enough to meet the needs of of different types of people different types of problems or try to solve use cases. Um, but also that has real depth so that no matter who’s using the product they can kind of get the most out of it and and get their job done. So I think you know it’s a little trie but I think good product leadership starts with knowing your customer and and talking to about men and and knowing what their goals are and helping them achieve their goals.

Alejandro Cremades: And when you’re talking to customers. How do you? How do you think about the questions that you’re asking. How do you go about asking the right questions so that you can get the answers that are going to allow you to to really know how you got to go about building things.

Drew Banin: Yeah, this is this is a huge superpower for us and it comes back to the consulting Era like we were our own customer and I find myself really leading on those experiences doing the data work. You know, being on a consulting contract Deadline. Feeling the pressure of you know people talk about using a tool in Anger like what does dvt feel like when you’re super stressed about um your cfo asking you for the updated board numbers like does dvt help you solve the problem or does it stand in your Way. So I think us being.

Drew Banin: That customer ourselves or or even more personally like me doing the analytics work either in 1 of these college internships or or here at dbt labs consultant. It really helps me empathize with folks and talk about it less is like an interview and more as a like a peer collaborator like. How should this work. How do we think it should work and I find that folks are are kind of able to get to the root of ah, whatever their problem is or whatever their need is in those kinds of conversations.

Alejandro Cremades: Um, so then let’s say talk about you know where where things are heading and and let’s talk about the future here. Let’s say you were to go to flip to Ni Dr and you wake up in a world where the bishop you know the company is fully realized what does that world look like.

Drew Banin: Wow! What a good question. Um, it’s hard. It’s a little It’s a little um ah like Sisyphus you know like the role the ball has to roll back down the hill in order for you to be able to wake up tomorrow and do it again. I think like a lot of um, fidgety founders. 1 of my fears is not having anything to do and getting really bored. So I’m I’m grateful that we have an ambitious mission that will take you know a long time to realize in full but to me if we did realize that it would look like you know data teams having a seat at the table. Data folks being respected for what they can contribute to the organization you know viewed as as a ah group of people that can help make better outcomes happen faster. Um, and for the people using dbt. Hope it feels like like a really indispensable tool in their toolkit in the same way that your software engineers think about git or python or you name it. It’s like it be hard for me to do my job without this thing and so I I think that when we. Think about realizing the mission. What’s kind of happened is we started by thinking about individuals. It’s like what’s that individual experience of using dbt and now if we as we’ve grown and and we’re working with you know, bigger and and and more sophisticated um types of organizations. Ah, let me say like.

Drew Banin: Bigger organizations with more sophisticated types of problems to solve specifically those around collaboration. We’re kind of seeing that the multiplayer experience of Dbt is just as important as a single player experience like if you really want to maximize someone’s impact as an individual contributor. A great way to do that is by helping their team.

Alejandro Cremades: On.

Drew Banin: Maximize its impact and by helping their team collaborate with other teams. So a lot of the product we’re working on today and that we think we’re going to be working on in the future too is around this collaboration. You know within a team and across teams and helping folks. Um, ah like avoid bottlenecks. But we can go so deep on this if it’s interesting, but but helping helping avoid bottlenecks helping folks collaborate across teams um making it so that the more using dbt like the better the experience.

Alejandro Cremades: Um, and and what 1 thing that you may appreciate there. You know since since you’re a product guy. How do you go about aligning you know product with vision.

Drew Banin: It’s a good question aligning product with vision. Um.

Drew Banin: We start with we start with the vision I think we’ve always done this and we’ll find out if it’s a good idea or a bad idea. But we kind of lean on our experiences and we try to imagine what should be true in the future that is not true today. And then we try to go and figure out how we build the product to to realize that vision. Um, it’s still very important that we like talk to customers and and hear feedback and integrate what they have to say into our product thinking but it’s it’s so trite. But it’s the Henry Ford quote about. If you asked people what they wanted they would have said a faster horse and I think it’s just one of those things where dbt was born out of an ecosystem shift. You know it was a platform shift. It was the advent of red shift and then you know snowflake bigquery cloud data warehouses put databricks in that camp too and there’s more beyond that.

Alejandro Cremades: Um.

Drew Banin: We were able to see the platform shift on the horizon and build a product that would help people maximize their impact with these new platforms and so it’s always in the back of my mind like what’s the next platform shift like what’s the next step change. Um, you know, increase in capability and where is that going to come from. And those things are rarely linear and people really rarely ask for them by name. So when we think about vision we try to imagine like where’s this whole ecosystem going and how do we adapt the tried and true principles of you software engineering to that reality. Um today that looks like. You know the the dbt that that you can use at cloud gettbt.com if if you want um tomorrow I don’t know that’s where we get into these conversations about things like streaming and and um. Potentially other types. You know we could talk about like python and sql and how they work in the data platforms like that’s kind of the universe the ah the art of the possible I guess um, but we always we always try to start with like how do we think the work should be done and then work backwards to what’s the product experience that will support. It.

Alejandro Cremades: I.

Alejandro Cremades: Um I love that now we’re talking about the future here I want to talk about the past but doing so with a length of reflection. So let’s say I was to bring you back in time you know maybe to that point that you were still in Rj Metrics you know and you guys were like brainstorming. Doing something of your own and and and so forth and let’s say you had the opportunity of going into one of those you know sessions that maybe you guys did at Starbucks or something and you were able to sit down right there with all of you and you were able to give everyone right there on the spot. 1 piece of advice for launching a business. What would that be and why give me what you know now.

Drew Banin: You know I do think about this sometimes I don’t think I’ve ever said this to to anyone? Um I wish we raised money before we actually did so going from Bootstrapped to venture backed required us to have a lot of confidence. The thing we were building was durable and could exist for a long time and and we talked about wanting to build a company that could exist for decades like we really didn’t and don’t want to be a flash in the pan here. Um, so we we care about sustainability and so raising venture capital was something we took really seriously. But in retrospect. What happened was that the community grew much faster that our capability to support it with software and product because you know there were probably a thousand companies using dbt at the time when we were still fishtown analytics and still you know building open source software exclusively. So. I think that if we had a little bit more of a head start. It could have the the growth compounds I wonder where we would be today if we had an extra year of growth growth behind us. But um, that’s the 1 thing that I really wish who knows who knows what happens in that alternate universe. But I’m curious if if um, ah I’m curious. How things would have gone if we raised money a year earlier.

Alejandro Cremades: I Hear you I hear you so drew for the people that are listening that will love to reach out and say hi. What is the best way for them to do so.

Drew Banin: Sure I’m on ah the dbt slack which is free to join. You can you can join us at gosh let me double check. Actually, it’s been a minute since I signed up myself I want to say it’s community dot get vbp.com

Drew Banin: Yeah, that’s a good place to join community dot dvp dot com I’m at Drew Bannon in there or you could catch me on um the app formerly known as Twitter that I think is now called x I’m at Drew Bannon maybe

Alejandro Cremades: Um, okay, amazing. Well hey, that’s that’s super easy then and to drew. Thank you so much for taking the time it has been an honor to have you in the dealmaker show today.

Drew Banin: Hey it’s my pleasure. Thank you again so much for having me on.

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