Neil Patel

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Spenser Skates started flexing his skills as a tech entrepreneur when he was just 16 years old. He has since raised almost $300M for his latest venture, before taking it through an IPO. The startup, Amplitude has attracted funding from top-tier investors like Covenant Venture Capital, GIC, Institutional Venture Partners, and Battery Ventures.

In this episode, you will learn:

  • How to think about an IPO and involve your team in it
  • Getting your first paying customers
  • How much to ask for your product
  • How to think about the value of your company and its metrics
  • Spenser’s top advice when launching a company

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Interested in sponsoring this show or podcast ads for your business? Go to Zencastr and fill out the contact information so Zencastr can help you, bring your business story to life.

For a winning deck, take a look at the pitch deck template created by Silicon Valley legend, Peter Thiel (see it here) that I recently covered. Thiel was the first angel investor in Facebook with a $500K check that turned into more than $1 billion in cash.

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    Moreover, I also provided a commentary on a pitch deck from an Uber competitor that has raised over $400 million (see it here).

    Remember to unlock for free the pitch deck template that is being used by founders around the world to raise millions below.

    About Spenser Skates:

    Spenser is the CEO and Co-founder of Amplitude. He experienced the need for a better product analytics solution firsthand while developing Sonalight, a text-to-voice app. Out of that need, Spenser created Amplitude so that everyone can learn from user behavior to build better products.

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    Connect with Spenser Skates:

    Read the Full Transcription of the Interview:

    Hey, guys. Today’s episode is brought to you by Zencastr. I remember back in the day when I was looking at putting together Zencastr. I was looking for a solution that would help me in putting things together. Essentially, this is what allowed me to bring DealMakers to life. Basically, Zencastr, what it is is an all-in-one solution where you just send a link to the person that you’re looking to interview. They would plug in their computer with their video, with the audio, and then you are good to go. You would piece everything together, give it to your audio engineer or even edit it yourself, and you are off to the races. Now, if you’re looking at getting into podcasting, you should definitely check Zencastr out, and you could also get a 30% discount, and this is the discount code that you will be able to redeem by going to Zen.ai/dealmakers0. Lastly, I was very much blown away when I found out that investing in wine has been one of the best-kept secrets amongst the wealthy. This is now not the case anymore. I came across this solution, which is called VinoVest, and they are a great solution that allows you to diversify investing by implementing or including wines into your portfolio. Take a look at this: wine has one-third of the volatility of the stock market, and yet it has outperformed the global equities market over the past 30 years with 10.6% annualized revenues. It’s a really good way to diversify your portfolio, and you could also get two months of free investing by just going to Zen.ai/dealmakers, and by going there, you will be able to redeem your discount.
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    Alejandro: Alrighty hello everyone and welcome to the dealmakerr show. So super exciting founder that we have today with us. He is been a founder now that has built something from nothing and recently took his company public. We’re gonna be learning a lot about that journey what it took to take it all the way. To where it is now with hundreds of employees ringing that thing that bell I mean super exciting stuff. So I guess without further ado. Let’s welcome our guests today Spencer Skage welcome up to the show.

    Spenser Skates: Fantastic to be here I’m really excited to to share the amplitude story with ah some ah you know future Entrepreneurs. Hopefully my lessons can be of help. It’s been a very crazy Journey. We’ve been through it over a decade at this point. Um, so yeah, let’s let’s go ahead and get into it.

    Alejandro: Over a decade I mean I can’t even imagine in dock years what that is and because startup yearsers are like insane but but we’ll get that in into that in just a little bit so originally born and raised in Cambridge Massachusetts so give us a walk through memory lane. How was life growing up there.

    Spenser Skates: Um, it was great. You know I was um yeah I kind of I wasn’t exposed to kind of the tech world and and programming that early on and so you know pretty normal childhood. Um, you know I ended up going to local elementary school and and local high school there. The 1 thing that started to happen when I was about 12 is my mom took me on a trip to visit some of her family. She’s from originally from Malaysia and. Everyone there was very into building their own computers and creating their own little setups and you know really into kind of the technology scene and inspired me to say okay hey I’d really love to kind of build a computer of my own and so that was really my first real introduction to to technology and programming. Um I ended up creating my as a result of doing that I started to get pretty handy with computers and ended up creating my own it support business when I was 16 um and would just you know I put up flyers around the neighborhood saying hey I can give you computer help if you’re interested I remember I was. Charging $30 an hour which for a high school student at that time was an incredible amount of money and I was making like 2 or 3 times some of my peers who are kind of working you know other other other other jobs and it was just it was an awesome it was an it was an awesome experience you know I got to. Learn how to work with customers firsthand run your own you know a little bit of your business. We didn’t but we didn’t make that much money but it was it was a lot of money for a high school student at the time and it really helped me understand how like you know there’s a lot of people out there that have technology needs. And if you’re able to take some of your technical expertise and take that to you know to to different situations. You can do you can do very very well because there’s just so much demand for technology and understanding it and all of that and it’s it’s a big world out there.

    Alejandro: And you ended up going into mit and what you studied was bioengineering I mean that sounds extremely complex complicated I mean what? what was that.

    Spenser Skates: Yeah, bioengineering was actually a new major at mit at the time we were the third class to go through it and the the reason I did bioengineering was because you know if you’re a smart and ambitious young person I thought you would go into academic research you know. But both my parents are involved in academic research in some form and um, they you know I thought you know I was the past that that you did and I didn’t really know like you know, even though I had done that it support business I didn’t know that you could make you know a whole career out of the technology thing or what that would even look like um and so. It wasn’t until I did so anyway, so buy engineeringing was great. You know I learned it a whole bunch but 1 of the actually really funny and ironic things is most people from that from our program like if I look at my classmates. There are about 20 of us in that program who are my year most of them actually have ended up in the technology industry later on and so I’ve gone on to become like 1 of my friends is a software engineer director of software engineering at github you know you know, ah other than them have started companies and so you know everyone’s kind of transitioned away from doing biology. Ah. Where you know frankly I think that the industry was just a little bit too early when we were starting out and and I’ve ended up in software my my my transition was ah by in my sophomore year of college I did this one programming competition called battle code. For those of you don’t know battle code. It’s mit’s largest programming competition. You get like 300 or so different teams and the way it works is. It’s over the course of a month um there’s a month long break that we have in January called iap where you can kind of do whatever you want as an mit student. And one of the things that they have is this program competition and the way the competition is is set up is they release a video game and you’re supposed to write an artificial intelligence for that video game and you compete with other um other people’s bots and you know they have a tournament. Have a bunch of different tournaments over the course of the competition and the goal is to be the most successful bot out of everyone else and to be you know your your competitors and this was my first real introduction to the world of like hey maybe I could do you know software as a career. And it combined a whole lot of things I loved to combined video games and it combined competition and it combined programming. It’s like all these things that I just got a tremendous amount of joy out of and so sophomore year I did the competition for the first time we totally sucked. You know we were just yeah, we’re the bottom barrel of the teams. You know we were barely.

    Spenser Skates: Trying to figure out how to scrape the thing together. Um, but what I saw was that a lot of people who had gone through the competition would end up doing really amazing things in their careers. So they’d go on to work at you know, high frequency trading firms and go on to work at big tech companies. Um. And 1 of the other careers that that came out of it was starting your own company and being a software entrepreneur the founders of Dropbox Drew and Arash both had been involved in the competition before I joined it. Um, you know there’s a bunch Aaron Iba was 1 other one there there were a bunch of other folks that had. Gone through the competition and gone on to create very successful companies and I was like wow you know that’s really cool I didn’t know that you know the same sort of skills that you’d use in this programming competition. You know could be applied to to building a company. Maybe I can actually make a courier out of this technology thing you know which I just had no exposure and no idea to before. And then so my junior year we were like okay I’m going to do everything I can to do really well at this competition and prove that I can be really successful in this industry and so I spent the month before the competition studying on the previous year’s codes and doing just lots of practice. I just tried to recruit the best team I could so I got my roommate Steve to join you know I got a few other folks to join us I got like I bought a whiteboard for my room so we could do whiteboard coding in the room and and plan out how how we were looking at things you know I was just really really and I didn’t do and I made sure to set up so I had nothing else going on during the month competition you know I like um yeah like I like wouldn’t go see friends I wouldn’t go to parties I you know we’d just be like make sure it’s set up so I could work from like you know 10 am in the morning to midnight at night. Um, so you know you could do 14 hour days you know back to back through the entire month and I got so and it was so much fun. It was. It was one of the highlights of of my college experience. You know we got really into it. You know we got to know some of the other top teams kind of as adversaries. Um, you know I you know all all sorts of all sorts of crazy and I remember there’s this. You know people got really into the competition. There’s this one team that would like send one of their teammates. Um over to to our place to like purposely try to try to distract us and they would like be like hey let’s go hang out and let’s go to a party and get drunk together.

    Alejandro: I Got very strategic.

    Spenser Skates: We’re just like we’re like nice try you know, nice. Try. We’re just really focused on this thing there. There are all sorts of underhead the tactics like that where you where you people get get really into it and so but and it was it was so much fun it was it was a ton of fun and at the end of the competition. You do this thing where um. You get up on stage in the main auditorium at mit in front of hundreds of other students. Um, and your bots battle it out on stage while you narrate live. Um and that year in junior and my junior year you know there are a few top teams and and we by ended up getting lucky and and winning the whole thing. Um. And that was where you know, kind of the world really opened up for me. It was like wow okay, you know I found something in life that I’m really really good at and there’s so much opportunity beyond it if you do it right? You know? um. Ah, you know lots of high frequency trading firms became really interested in me and my work you know I talked to a lot of startup founders I talked to you know a bunch of big tech companies and it was just really fun. Um, and and yeah.

    Alejandro: Was this the the when when sunlight was that was that when sunlight your first baby was was really born and and no that was the first company correct sunlight.

    Spenser Skates: No. So no, yeah, so someone like came came a little while later. So um, the the way the way it happened so I had really wanted to work with 1 of the my. 1 of my close friends in the dorm and my current co-founder Curtis and Curtis at that time in junior year he had already signed up to compete with a different team for battle code and so and I was like really frustrated like Curtis what the heck like. Come join my team like you know we’re going to go dominate this thing and win. He’s like he’s like a very loyal person. He’s like no already committed to these folks and you know I’m going to go do it and you know and and it turns out he was the only one who actually did any work on his battle code team and and halfway through the competition. He’s like yeah I should have I should have worked with you guys and so um. When it came time to to go ahead and start a company I was like Curtis you don’t want to regret it. You want to make sure you join me for the next one and so come out and you know work on me with something and and and to his credit. You know what he said was like look I really want to do work for a year first and so I want to learn just the basics of what it means to be a professional in the industry I’m going to go work at Google for a year and then after that I’ll join you and I was like man if he goes to Google like there’s no way he’s coming out like everyone who goes there who talks about starting a company never ends up going to start one and just ends up. You know, getting sucked into the borg there and. Um, so you know what what what? What ended up happening is um I was really excited about starting a company but I didn’t have a co-founding team yet and I wasn’t so I ended up taking a detour for a year in finance first I was in high frequencyancy trading at this place called d or w and I’d work nights and weekends where I just. You know, do side projects with different groups of people you know and fly out to California to meet with folks and to you know, just jam on ideas we tried out all sorts of stuff that that didn’t work out and is just you know, kind of your kind of kids out of college that don’t know anything about what’s valuable and was not um. And the idea was I’d keep working on Curtis and I’d make sure he he was actually committed to leave at one point I finally was like okay you know nine months into the job I was like you know I really want to go and do this there’s enough momentum like let’s go start something I was just kind of itching to get out and and put all my energy into that full time and so I moved out from Chicago. Um, to California and I moved in with Curtis and I slept on a mattress on his bedroom floor. Um, and I was like you know I’m not leaving until until you leave Google and we go do this thing and so so you know Ed so he’s like yeah, all right? All right? Let me wrap up my year first and then I’ll leave and so you get to his year cliff.

    Spenser Skates: Left the job to his credit. He actually left and he joined me and we started working together and it was awesome. Um, the the funny part was before we actually started when it was just myself. It was like going from a full-time job to building a company. Um, where you’re kind of all on your own and there’s no one. There’s no team. You’re working with that was a really hard transition I would like get up really late in the day I’d like play video games all day you know and then like Curtis would like come home from his job at Google and like by the time like. He was coming home I’m like man I really better, get something done before he comes home to like show him I’m actually working on stuff and I’m actually doing something and so I’d code for like an hour or tw hou hour or tw hou hour and then I like he’d come back and I’d be like look at all the cool stuff I was working on today even though had it done really much so it was it was just kind of a funny you know it was that was ah it was a really kind of funny transition.

    Alejandro: And what was what what? what was that transition then from because here you go you get started with sunlight and then obviously sunlight ended up being the segue to to what you’re doing with amplitude now. So so walk us through that sequence of events.

    Spenser Skates: But when he actually started. Yeah.

    Spenser Skates: Yeah, yeah, so you know after finally Curtis left his job. We’re like all right all this other stuff we’re working on doesn’t make sense so you know we started on sona light so sona light was a ah voice recognition app for those you don’t know. That was it was like a version of Siri except for the Android phone and it had this really cool feature where you could it would listen in the background for your voice. You could talk to your phone and then it would. Allow you to have a conversation to like send and receive text messages so all the hands free stuff that Siri does today you know we you know we were actually we did. We had done that and launched it before syriai had launched. Um so we did that that was this was in in 2000 and this we started in 2011 um, we got into y combinator joined the winter 2012 batch I remember we had a really cool demo at demo day at y combinator where I I got up on stage I had my phone and I was like showing people my phone I put it in my pocket and I started to have a conversation with it and people were like blown away. Um, and we got the most press coming out of that demo day out of like 60 you know now Yc’s a lot bigger but there were 60 different companies at Nyc at the time and we had like 15 different press articles written for us which for an early stage company was was very impressive. It was like us and couple There’s this like 1 other. Um, app that were the kind of superstars and in demo day. Um, and the the funny part of it was was that even though we had gotten so much press and gotten so much coverage and all you know was kind of the one of the stars coming out of the batch. Um, that didn’t actually convert to building a real business. Um, we had major issues with retention and keeping our users around you know it wasn’t like we were growing crazy quickly and you know it was clear that the the fundamentals of the app you know were not going to be a supervisable long-term business. It was. Um, you know we could have probably stuck it out and just grinded for a bunch of years but it was clear that you know it was not going to be a great path to success the voice recognition technology was just a little bit too early and so we took that and we said okay you know what else is there out there and. 1 of the things we had worked on was actually building our own analytics product internally at at soal light and the reason we built it. You know, partly out of Hubris but you know because we’re like oh hey, we’re smarter and better engineers than anyone else, but partly because there were all these questions we wanted to answer

    Spenser Skates: About the user experience that we just couldn’t get out of off the-shelf tools like Google Analytics or Adobe or anything else in the ecosystem and so we said okay like we wanted to answer. For example, how much does the accuracy of the voice recognition when you first use it matter and have an impact. On your long-term success and as it turns out it has a massive impact like you know if you have an accurate match on your first try. You’re twice as likely to become a long-term successful user of the product than if you don’t um and that sort of insight we had to kind of construct it out of a bunch of custom sql queries. And you know our own database and all and all of that in order to answer it but it gave us a lot of insight into what was important and what was not in the application and so when it came time to shut down so many other companies that we knew were like wow. That’s really amazing that you’re able to get that level of insight about your product. How is it. That we can get the same thing and so this time around we made sure okay before we actually start building anything. Let’s just go talk to lots and lots of customers. So we set up 30 different interviews with potential customers like just other companies in that in that in our batch and outside of it that we had met through. Program and we said okay, is there a real need for this before we even started building anything at the end of that we’re like wow. Okay, you know, not everyone could be a potential user but there’s so much pain around this thing if we can build something we know that we can get people to pay for it so we started that process in 2012 um, we spent about a year developing one of but our biggest mistakes then was that we didn’t actually launch the product we took about a year and a half to really launch the product I would have launched it much earlier and I would have gotten I would have tried to get someone to pay for it much earlier. We were just begging people to use it at that point. Um. We tried to we raised a seed round of $2000000 back in 2013 back when $2000000 was a lot of money and but that that process was just absolutely brutal like I remember we were going around investing or 2 investor just basically asking them. You know, no real customers. No real traction asking them to invest in me and Curtis as as co-founders. Um, and it was just brutal because like we’re asking for 50 k checks at a time from all these angels and you know once in a while every few weeks we get a yes but you know lots and lots of Nos and you know if you’re ever trying to put together a million dollars doing it. $50000 at a time very very painful way to do it. You need to you know? and so eventually it did come together after about six months and and we got the money done and that time there’s about 30 or so.

    Alejandro: How many how many investors how many investors were were there. You know as part of those to move.

    Spenser Skates: Thirty five thirty to 35 different investors and so we were really just asking anyone who was just willing to take a flyer in a bet on us. Frankly, um this.

    Alejandro: Did you have like any any any concerns you know around how that could impact the cap table with having so many people or maybe at that point you were not thinking about it.

    Spenser Skates: Yeah I don’t recommend it for sure I mean it was great to to get so many people you know as investors as us, but it’s much harder to develop deep relationships and get a lot of leverage and get a lot of help from someone in a dedicated fashion and so it’s kind of like you know when you have so many people in like what we call.

    Alejandro: Yeah.

    Spenser Skates: What they call a party round. It’s like no one’s really invested in helping you succeed and so you know it’s not like there was one person we would regularly talk to to get advice or anything like that. We’re kind of mainly operating on our own.

    Alejandro: Right? but.

    Spenser Skates: Yeah, so I definitely don’t recommend doing it if you can help it I’m really appreciative to the folks who do invest us at at the time but it was it was much more painful to put that together and it was you know harder to get leverage help you know in terms of someone to get really deep on amplitude with us. Um.

    Alejandro: First and and just so that the people that are listening to really get it what what ended up being the business model of amplitude.

    Spenser Skates: Yeah, so so we were going to do it as saas where you would have charge for a recurring revenue based on how much you used amplitude as a product and you know Sas was just a It’s like the best business model of all time you build this piece of infrastructure you sell it then people you kind of get these you get this growing base of dividends over time where it’s very predictable. What sort of revenue you’re going to get in any 1 period and so it’s just a phenomenal business model that has a number of of great characteristics about it. Um, you know and and the ecosystem back in in 2000 and and 13 was was really really early at the time. So yeah I I remember that the very first product that we sold the very first time we sold the product was was mid 2013. We’re talking with I still remember this company 12 elve gigs um, they did casino and slotsapp we go do the demo. We get to the end of the conversation and the ah you know the the cto of this company asked. Wow this is great. How much does it cost and I’m like I was shocked because I’m like. I’d never been asked for money for software before it was like you know whoa like someone wants to buy it like that blew my mind. It was like you know I didn’t have to beg someone to use it and I didn’t even know you know what to I didn’t even have a number in mind or an idea I was thinking something like $ 50 a month um but I remember the advice where it’s like there’s lots of advice about you know you should charge and ask for way more and so I was like what’s the biggest number I can possibly think of and I was like a thousand dollars a month and I like kind of put it out there. Um, you know I’m like you know waiting to see his reaction and be like oh that’s too much but what he said was like oh wow that’s really cheap. And I’m like what like a thousand dollars a month it’s cheap like this is amazing like all my dreams of like building software and having people pay money for it and that moment had been fulfilled because you had someone who was willing to pay us $ 1000 a month for our software. Um, and it was just It was just the most incredible experience and now like now I ask for like millions or tens of millions of dollars in contracts in the conversations I’m having and it had no problem with it. But that moment still sticks out because it was the very first time someone had you know, agreed to pay us money for for our software. So um. So we added jeffrey at that point you know our third cofounder and then launched the company in 2014 I transitioned from the engineering and product side to the sales side full time and then you know it was just it just kind of started taking off from there.

    Alejandro: And for you guys I mean you were alluding to it before on the financing just to to to expand on that. How much capital did you guys raised prior to the ipo.

    Spenser Skates: Ah, so we we’ve done I actually should have this off top my head but we’ve done a number of rounds so we did our series so we did seed which was 2,000,000 series a which was 8 someone someone listening can do the math series b which was 15 series c which was $30,000,000 series d which was which was I want to say ah 80 it was 80000000 and then it was series e which was 50,000,000 and then series f which was 100,000,000 so I don’t know few 0 in total before we we went out to the to the public markets basically kind of every year and a half or so you know we’d raise around another you know we’d kind of achieve beyond what we thought we would and then we’d raise ah another round of capital to help us to to help us. You know, continue to fuel that growth. 

    Alejandro: That’s incredibleddle.

    Alejandro: And then also quite the roaster as well of um of investors you got Benchmark battery ventures institutional Venture Partners Seoia Capital I mean you have like the who is who there’s like the oscars of ah of venture investors. So I mean how how were you able to really get all these guys involved.

    Spenser Skates: Yeah. Yeah, um, you know we’re we’re lucky to you know, frankly in a lot of ways I think just to go back to benchmark I you know I didn’t actually know who they were before I had even met them and I remember looking them up and I’m like wow these are some of the best investors of all time you know Twitter zendesk new relic uber snapchat you know list yelp the list goes on instagram and I so I you know I remember meeting eric and I gave him the pitch and you know we ended up connecting quite a bit you know he he really looks for engineers. You know, hardcore engineers top top engineers who are interested in building businesses and who have an aptitude for the business and and go to market side and so we just really hit it off and connected. Um, you know they came in at the end of 2014 and you know I I think honestly, it’s been a huge part of our success I talked to eric like once a week you know he’s been probably the number one coach and life mentor in a lot of ways of me like you know going through. He’s interviewed hundreds of people for us. You know so many critical inflection points. He’s helped me navigate a ceo of amplitude from. Um, you know I had to be interim sales leader at one point I amplitude in in 2019 for about six months he went around. He interviewed a bunch of sales leaders in his network to understand hey what does it take to do forecasting really well kind of created this 2 page pdf for me, you know, help you know, gave me kind of a template and the guideline for how to do it which was just phenomenal. Um, and so you know he’s kind of been. He’s but he’s just been a massive help every step of the way and and we’d be a tiny fraction of the size if it if it weren’t for the work that he’s put in to you know, help building. Amplitude. Um, so you know that was so that was benchmark. You know, obviously you know tons of other phenomenal investors near a at at battery you know he’s the the godfather of sas and most prolific sas investor of all time. He’s been fantastic pat grady at sequoia. 1 of the best growth investors of all time you know we really kind of he was actually pat was really funny because he was he pitched amplitude to me better than I pitched it to him that was the first time that happened with a vc where they had done a better job of pitching me my company because he actually had this thesis around the market and how product was going to become a distribution channel for companies.

    Spenser Skates: Um, and that you know we had the potential to be the center at it of it if we did it right? and so you know that was great. Um, you know ivp semesh at ivp you know Tons tons of others and so yeah I think. We’ve just always had a very consistent long-term outlook on what it is on who we are and what it is. We’re trying to do um and you know we’ve been able to to partner with just some with some phenomenal talent out there. Um on on the venture side. You know I think the the other. I do want to say like you know I think really for the early stage the early stages of your business investors can be quite leveraged if you get the right ones on board. You know Eric at benchmark was really that for us I think as you get larger and later stage and you know. You’re kind of there’s more There’s an existing organization in existing business. So that really becomes much less of the case.

    Alejandro: And and you know let’s talk about like him taking the public the company public. So what was that that experience like you know, perhaps even even even take us to the night before of ringing the bell I mean here, you’ve been you know working your butt off.

    Spenser Skates: Um, yeah.

    Alejandro: And building this from nothing and then all of a sudden you’re going to sleep on the next morning you know it’s time to ring the bell.

    Spenser Skates: Yeah I mean it’s surreal. You know for sure it’s it’s an it’s an outcome that Sony people just dream of for such a long time that like it’s just like you know it’s it’s it was crazy I mean I didn’t get much sleep the night before for sure. Um, I was so stressed that morning because we had to get up early and do a bunch of media interviews. Um, you know, ah, we were really lucky. We had a great team in place to just make the event run smoothly and I just didn’t have to worry about anything but being in the moment. Um, you know the opening bells sequence was awesome. We did like a. You know we got a lot of ampliteers. You know one of my favorite parts was everyone who had been at the company for five or more years we got to bring out um to the celebration. You know I think a lot of teams really make the celebration about the Exec team or about the investors and it was really for me about the folks who had built amplitude. And so we invited like everyone who had been part of the journey up to that point for five or more years to be part of that celebration and it was just fantastic to to be able to to kind of celebrate it with them I think yeah and so that was that was just surreal I was and then it you know goes by so fast as well. The other part which was a lot of fun to me was. Um, doing a direct listing the way they open the market. It’s like so so you know you probably if if if anyone’s listening to me, you know you you know that I’m very much in favor of direct listings and I think it’s almost criminal that people go out take companies public for any other method. Um, direct listings provide market-based pricing for your stock which is really the point of going out to the public markets. Is you want market-based pricing. So why would you do a transaction that’s not market-based with it. So but because I had come from the finance world I knew a lot about or you know I knew a little bit about the mechanics and you know how markets actually work and. You know how the inputs work. Um, and so I remember I did the session with all the folks who were there at the listing and kind of did an educational thing that just helped them understand. Um, how it is the mechanics work and what to expect and what does a bias elder what is the sell order. How do they match in the market. How does that determine the price that something transacts at and I remember I did this like 15 minute education session for the team and you know it was one of the highlights for me because it was just you know, allowed me to bring them along the journey and educate them about. You know the process and and how the thing worked and so that was a ton of fun that that was that was really a ton of fun and just to celebrate it there with everyone and you know a lot of ampliteers. You know, just ended up coming out on their own to celebrate and be part of it which was which was fun as well and you know was crazy and so it was it was you know was I think.

    Spenser Skates: The the important the last thing I’ll say about it is like the the thing you’re really doing there is it’s really the introduction of the company to the public markets and so so many companies get that wrong. We have so I’ve seen so many. Entrepreneurs get to that state. But then not really have clear direction on what’s next for the company and so we actually named our our public listing like project project alpha because we wanted people internalize that it really was just the start of a new journey for the company. And a start of what was next and so we did ah I think we did a really good job of of kind of setting that message consistently with the company and and the team and so you know I think. People understand that look you know it’s not like we get here. We’re all done with the business at the end. It’s like no this is where the expectations are highest. This is where we have the longest term outlook this is where we’re going kind of on the next stage of our journey to take on what’s next in in the market. So. Um, you know it really is the the start of a new weekending and people have to be thinking like that’s something that you know has been big for me personally where it’s like I’m thinking about how do I sign up for the next ten years of this journey and how do I get everyone else around the table to to do the same.

    Alejandro: And how big is the company today. Spencer.

    Spenser Skates: Um, so we you know we’ve we’ve passed I I want to make sure I want to make sure to get right in terms of public disclosures and what I’m a lot to say so let look.

    Alejandro: Or ah like let let’s just let’s just say this I mean right now you are operating a company that the market cap is over $2,000,000,000 um how many employees do you have and anything else that they that that you feel comfortable sharing.

    Spenser Skates: Yeah, yeah, so we have 680 employees. Um, you know we’ve our run rate as a business has passed 200000000 in air r um, you know the the reason I that’s that’s really important for me to to share is that I think um. So many companies really focus on the market cap or the number of employees. But again those are just outputs anyone can hire out a team or build a team and that’s not that hard to do and spend a lot of money. The real hard thing is can you create how much value do you create for your customers. You know what is it that they care about and so we’ve been hyper focused and dialed in on on that part. Um, you know since the start and so whenever we have this joke at the company is like whenever I ask someone how big amplitude is I want them to reply with how much revenue and how many customers we have you know we have over 1600 customers and. You know over $200000000 run rate business and so that’s that’s the important stat to me because that’s a sign of how much problems we’re solving and how much pain that that we alleviate and everything else and all the employee stuff is like you know that that kind of comes you know those employees are you know we as a team are are there just to help that to just to help our customers be.

    Alejandro: So now obviously remarkable journey I mean tremendous you know journey here. But if you had the opportunity Spencer of let’s say going back in time and I put you into a time machine and I bring you back.

    Spenser Skates: Successful.

    Alejandro: That time that you know you’re trying to convince Curtis you know to really to really start something and and you had the opportunity of having a sit down with that younger self and and give you that younger spencer 1 piece of advice business advice before launching a company. What would that be and why given what you know now.

    Spenser Skates: That’s a hard one I don’t I don’t know that I’d change that much. You know it’s like we got very lucky in a lot of ways and so it’s like you don’t know what happens if you perturge stuff I think but I think I think there were so. There was you know there’s some stuff that I think we got right that I was very conscious of trying to get in front of and there’s some stuff that I think I could have been better at and that I’d probably give myself advice so the stuff that I think we really did get right was just talking to customers like all the time you know you should be spending anyone in products. She’s spending. Like product management should spending half their time talking to customers a Ceo a founder even though I’m an engineer like as an engineer you know the problems you see problems and you know hey if I build this piece of software I’ll solve them the part that you don’t know is is it a worthwhile problem to solve and the only person who can tell you that is customers. And so you might have grand ideas of something you might want to build or an idea that you have but without talking and spending half half your time as a founding team should be talking to customers and that was something we got wrong at sona light. We didn’t really spend that much time we spent you know eighty ninety percent of our time building the product but not that much talking to customers. Um. And so that was something with amplitude I wanted to make sure correct and so we so I spent half my time before launch talking with customers and after that I spent all my time you know talking to customers and finding ones and that that were willing to buy the product so that that’s a really big one that I think we got right um one that. The the advice I’d have and the one that we were slow to is building out the executive team and getting more help there and getting it help earlier. So the business has always done very well and grown incredibly rapidly. But as you grow and you scale you need an organization that can keep up with it and so. I think we were a little naive in the early days and thinking like oh we can figure this all out. We’re smart but and like there was a lot that we did figure out but there’s also a lot of knowledge about how to do these things and how to build these things that already exists within the industry and so if you leverage that like that’s in like. That knowledge that can speed up your learning much much much faster than you can learn yourself and so I would have spent more time like I would have advised myself to spend half your time meeting people in the industry and learning from them building out that network and recruiting great talent and that was something you know as an engineer you i. Um, an introvert and I’m ah you tend to be very internally focused so it’s like what are the problems that we have what can we do to solve them here. Um, and you don’t spend a lot of time learning best practices from others and going out and seeking expert knowledge and that would have been something that I changed you know and would have been advice was like really talk to people outside.

    Spenser Skates: And recruit you know executives who have done this before um and spend a lot more time there I remember I kind of look would look at like spending time on the outside dismissively I’m like oh those people aren’t building their business but there’s actually a lot of value and a lot of knowledge on these problems. You know you want to go? you don’t want to just be in the scene to be in the scene but you want to meet people who can. Have perspective on what it means to company build the challenges you get into when scaling sales or engineering or product or you know finance or what have you and so that would have been somewhere I would have advised my younger spell self to spend more time once we had a company I think before you have a company just talk to customers and talk to build product. That’s it you know Paul Graham’s very right on that it’s like you know, talk to your users build your product. That’s it. You know you don’t want you spending you know, less than 10 percent of your time. Can we go into anything else. But once you start to grow um and scale the only way to do that is through. Bringing in leaders from the outside and so you want to be playing offense on that being very deliberate about who you bring in and how and and why they’re a good match for the business.

    Alejandro: I love it and Spencer for the people that are listening. What is the best way for them to reach out and say hi.

    Spenser Skates: Oh um, you know so I think a few different ways so feel free to you know, follow me on Twitter or anything like that send me an email at http://spenceramplitude.com I can’t guarantee I will reply to it but I do look at everything that comes into that. Um, the other big one is if you want to meet us in person we’re hosting our customer conference amplify in Las Vegas from May Twenty fourth to Twenty sixth so I’ll be there I’ll be speaking if you come to me to meet with me at Vegas I will guarantee you will get at at least a chance to say hi. And so yeah, that’s that’s another great way if if you want to come come meet up with me in person.

    Alejandro: Amazing. Well Spencer thank you so much for being on the dealmaker show. It has been an honor to have you with us.

    Spenser Skates: Alejandro it’s been fantastic. Having you here. Hopefully what I’ve shared today is helpful to the listeners as you all think about building companies and what it means to to build a great company. Really appreciate this chance to share the story.

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