 Good afternoon. I want you all to think about companies like Com, LinkedIn, Uber, very different companies, very different products, categories such as healthcare, recruiting, transportation, but the question you have to ask yourself is what do they have in common? And we can do a little quiz here. I'll give you three options. Is it one that they are the leaders in their categories? Is it two that they got to their head start through product, not just sales and marketing, but superior products? Or is it three that they all share a common playbook for how they've leveraged product development to get ahead of their competitors? And I have good news. No matter what you answered, it's correct. All three are accurate. Now, they're also quite established companies and I know most people here at Slush are just starting out or very early in the journey. And that journey is quite different. It can be difficult to see exactly where you're going. There's lots of obstacles. And if you're building a product that's solving a problem that's worthwhile, you're going to have competitors in the space ahead of you and behind you. And so the comparison I always make is building an early product is like the Paris Dakar rally. My favorite race, I don't know if any of you are familiar with it, but it's basically 8,000 kilometers, mostly in the desert, mostly at night. And it's a quite challenging area. And fortunately, we were just talking about the applications of chat, GBT and Dali. It's very easy to generate photos that show how such a race is raced. But so before we begin today, I want to talk a little bit about some good news and some bad news. And I should probably guess from my name, I'm originally from Denmark. And in Denmark, we always start with the bad news. And so the bad news is, if you think about these companies that I've been at, they have what I would call durable product advantages. So these are things like they have a very strong brand. Most of you are familiar with these companies because you know of the brand. And the brand means that you can acquire customers much cheaper. They have things like network effects, like either because they're a social network, like LinkedIn, or because they have a flywheel in their marketplace, like Uber, or they have scale efficiencies, or even intellectual property. My first company, and the reason why I've spent a lot of time in Helsinki was I used to work for Nokia. Nokia, even today, has an amazing IP portfolio, 20,000 patent families, 6,000 of which are essential to 5G. And so over time, these companies, including here in Helsinki, have built amazing innovation and amazing notes. And shout out to any other Nokia, current or former alumni. And so I want to do a little bit of an audience test, and you're going to need both hands for this. If you think about your companies, either as companies you've invested in, or if it's your own company, on a scale from one to ten fingers, one being, I have none of these, to ten, or I have all of these nailed, what is it going to be? Raise your fingers. Let's see. Okay. I see, I see, oh, I almost saw ten. VCs, pay attention. Somebody has some good notes. Generally, I see low numbers. I see numbers of one, two, three. And that's the bad news, because when you start out, you don't have any of these benefits. They take a while to build. But I told you I had some good news, too. And the good news is that first mover advantages and being first and having built these are generally, I would say, overrated. And one of the reasons we tend to forget that companies, that they're overrated is that a lot of origin stories that we hear tend to forget that the companies weren't their first. Uber's origin story is very famous. Around 2009, two smart entrepreneurs figured out that this was the right time to disrupt transportation. You had the advent of a smartphone, you had GPS, and now was the time to build a ride-sharing company. Except that's not really what happened. There are companies way before Uber, including SimRide, that were two years ahead on ride-sharing. But we only remember Uber because they're the ones that won the race and got ahead of everybody else. Similarly with Com, probably the biggest brand in mindfulness, Headspace was ahead of Com, and LinkedIn was surely not the first social network. And so why does this happen? And it happens because as a startup, while you might not have the durable product advantages, you definitely have two advantages that are quite important, and you have those from day one. And they're number one speed, and they're number one focus. You are able to focus much better and much faster on a customer problem than these established companies are despite their existing durable advantages. And so let's talk a little bit about those because I think many people recognize that if you're a very large company, you don't move very fast. And I can attest to that. I worked at small companies, I worked at bigger companies, and generally speaking, the bigger company, the smaller you move. But I think what you need to recognize is that even when you're very small, being slow creeps in very early. And there's a bit of a trap where you'll make decisions that are seemingly improving your operations, but that slows you down. I listed a few here, they're on the release train, but like a classic example is you botch a deployment, production goes down, and you decide we should never do this again. So let's add some quality checks because that's the way you mitigate risk. Well, what tends to happen is you are very aware of the risk, but you're not so aware of the velocity impact, because it's very hard to measure velocity and how fast you're moving. There are many other examples, it's not necessarily just related to release train, it could be you're hiring a second employee, a third employee, that employee happens to be remote. And working remotely, while there are some companies that manage to do it very well, there are for many people and many companies, it does mean that things move slower. It is harder to communicate virtually than it is to communicate in person. A third example is a lot of the so-called best practices from Silicon Valley, Intel, Google and the like, things like OKRs, they're not necessarily helping you move faster, they're helping you move more deliberately. And for sure, a poorly implemented OKR process is much, much worse than no OKR process at all. And in general, making these choices towards velocity is something that has to come from the CEO, it has to come from the top from you founders. And it's often a difficult argument because while the risks of doing these things are very easy to quantify, the slow down that you see from doing these things, seemingly good improvements are slowing you down. And so the one take away, the first take away I would have for you guys is, hey, feel comfortable pushing back, feel comfortable deferring, adding process steps, because in the beginning, you only have two competitive advantages, speed and focus. And so retain your speed advantage by trying to defer as much as possible of implementing these bigger company processes. So that's all about speed. I think the other thing is about focus. And on focus, I want to talk a bit about distractions. And I think the first distraction is ironically when we talk about competitive advantage competitors. So I don't know how many of you are familiar with this, but you know, have any of you ever gotten an email from a customer or a friend, your investor or your board of some company in your space launching a similar feature or launching a similar product? I want you to think back to the last time you got that, you probably got that today, because there's lots of companies that are launching exciting things. Did you take any action? And did that action actually lead to any improvement whatsoever? I found myself being obsessed about our customers early in my career. And it was not a good productive use of time. If we take it back to the racing myth metaphor, I would say it's like a little bit akin to driving a race and you only navigate by the tail lights of everybody else. You need to be aware of where the traffic is, but you shouldn't drive based on it. And so what I would recommend is you have a very specific system set up. And so what I like to do is you really only need to monitor two things. New entrance in the category and changes to product or positioning of your existing competitors. It takes a little time to set up, but you can basically have, let's say you take an hour out of your schedule every Monday. Nowadays there's software that can monitor and give you alerts and you can basically just have a system where instead of being pulled 17 ways till Sunday by whenever you're getting an email from an investor or competitor, you have a set time and you review what's happening. At Com we're an app so that the app rankings are very public. There are very expensive software that can help you monitor if there's new entrance in the category. There's free software and so I would encourage you to set up these systems that both monitor are there new entrants based on keywords and then nowadays you can also have tools that monitor your competitors pricing and positioning pages to see are there any changes in how the competitors are adding SKUs or selling new product or positioning the product. So build competitive awareness, not competitive obsession. So that's distraction number one. Distraction number two is your customers. Now I have two kids, I have a five-year-old and a nine-year-old. They're the most important thing in my life. I can imagine when you run a business your customers are the most important thing in your life, but if I was doing a race I definitely would not want my kids on the backseat of my car. They are not to be trusted and so I think specifically obviously customers are important but it's very distracting when they say what they need because you have to look at their actions not necessarily what they're telling you. Now I can't share proprietary data but I think the the examples from health and fitness are the most relatable. So in the United States the most trusted professional is a doctor followed by other healthcare workers and so you would think when people talk to their doctors they're being honest. It turns out they're not. They're lying about everything all the time and you're probably familiar with this as well and it's not that you're doing it on purpose it's just when you describe what you're doing to someone else it's often very aspirational and it can't be quite disconnected from what you're actually doing. In B2B I spent most of my time in B2B products. When I've talked to participants at Slush it seems like most of the products we're building here are B2B. I think a common question is you asked your buyer hey how do you make the buying decision and they will say something I've several times experienced a buyer say well you know I assemble all the competitors I get all the bids I build a spreadsheet and then I figure out which has the highest ROI and then I make a choice based on that and it sounds awesome. In fact it sounds so awesome that I always ask oh this is great show me this sheet I would love to see it and then more than once it turns out they actually don't have it because when you look at the actions they take the reason they bought was what they had hoped to do was an aspirational ROI analysis what's really happening is it's December 1st I have 100,000 left of my budget if I don't use it this year it's going to go away and I heard from a friend that I trust that your software is really good so I actually didn't do any due diligence I'm just spending it right now and so you always have to look at the actions in my past product jobs I had a rule that you're not allowed to do customer interviews about hypotheticals you should always bring a prototype and see how they react to it or you should always ask to see their workflow ask to see their screen ask to see how they're doing things because you will find that people aren't intentionally lying they aren't trying to distract you but the Valley and Europe is littered with companies that built exactly what the customer said they wanted but which they would never use because that are not the actions so those are the two distractions and I know you're wondering okay well I shouldn't be looking at my customers I shouldn't be worried about what my what my competitors are doing what should I be worrying about and so I think if you look at the leading companies in the categories right now one thing that they've all done is they have found what I would classify as a leading product indicator so I'll give you an example at Calm we are an annual subscription so in many ways we really only know if you got some value out of the product one year later after you've subscribed and whether you choose to renew or not and that's not a super great signal while revenue is the most important metric for many companies is fundamentally lagging the the revenue you're making today is from what you had built previously and what you're building right now you probably aren't selling yet so what is the metric that you can pinpoint that will give you an early indication on whether your product is working or not so for Calm it's very simple we know that for our mindfulness habit it's very important that you get to do some completed activities in the first week and we know that if you're successful at a certain amount of activities the first week you will be more likely to do it again the second week you'll be more likely to start paying from Calm and you'll be more likely to renew Calm so instead of looking at revenue we look at these earlier metrics that basically gives you a way to assess early on and within a day or two versus a year whether or not the the you are delivering value and so trying to identify this is pretty critical i'll give you one other example LinkedIn earlier on had a metric called engage quality members now you might think that what should we be looking at at LinkedIn it's a social network so let's just look at members but it turns out if you sign up for LinkedIn and you don't add your job title you don't add any connections your experience is going to be pretty shitty and and you're not going to have a good product experience and so typically what you see for leading indicators is that they're not the sign up moment they're not the aha moment they're further down where you're actually threaded enough in the product so you're sticky and so for LinkedIn that means you have a set of fields that are set such as your job title and the like that way recruiters can find you and reach out it's a big part of the value prop for LinkedIn and you have a certain amount of network which makes your feed much more interesting debatable if it's more interesting but at least you're seeing your friends and connections updates versus just random people and so these metrics are quite helpful they generally correlate with monetization but they are showing up much earlier in the process and identifying this is pretty critical now again I won't talk to the Uber example but you know all three of these are consumer metrics if you think about B2B and you are having a B2B company the place I would look for my leading indicator is do the following exercise think through your first year of renewals with your customer so you sold them the product they have the product they've been using it for a year what are you going to tell them what data are you going to show them to show that they've gotten value right there's a lot of B2B software that's sold but never provisioned never used there's no value there's even a lot of B2B software that has a lot of users but you know proper processes haven't been moved over or anything of that nature and so in B2B think through the conversation you're about to have a year from now and move that forward to the metric that really matters in terms of threading your customers into the product so those are the leading product indicators I think the other thing about leading product indicators is they're very very clarifying in terms of your product roadmap so if you we have the benefit of we can look back at LinkedIn's roadmap for the last 20 years now this is a very simplified view of the roadmap but the point I want to make is what is LinkedIn? LinkedIn is a it's like an online resume database and so the value of LinkedIn is that you know it's much more easier to find people online than it is to find them in a stack of paper and so you would think that the features that LinkedIn would build are things that makes it more easier to find people making the profile as rich as possible but if you look at how LinkedIn actually evolved that's not what happened at all LinkedIn was founded in 2003 and you know seven years later you could add certification publications patents 16 years later you could add skills and just this year you could verify your identity which are great features but it doesn't seem like LinkedIn has focused that much on profile completion at all what have they focused on they have focused on growing engaged quality members and so some of the first features of LinkedIn was a contact import where you add you know your back then you added your LinkedIn profile to to outlook or the like and you could invite your connections or it's features like people who you might know suggestions for you to build more connections because LinkedIn realized that the asset that they needed to offer and that they needed to build was the social network it wasn't necessarily the completed profiles it was the graph of how people know each other and especially trying to get as many members on board as possible and so you see a lot of the decisions that were made in product were to grow that so rather than trying to think through oh how can I have the most complete product or the best resume database no no no that's not the goal the goal is how can I get as many members on board as possible and back to the point on customers not asking for it I can guarantee you that customers or users consumers were asking for things to add on their profile and they were definitely not asking for a feature that tells you who do you might know or who has viewed your profile those are very savvy features that are driving more connections and more members to sign up now so I would say the takeaway here is you have to figure out as you find out what's the leading indicator of success you have to design to that and you have to build to that so initially you have your competitive advantages of speed and focus but over time you build one of these assets if it's ip if it's a network in the case of linkedin so just to sort of hone in and I know I've sort of talked in very broad strokes about the competitive advantages even saying brand is very broad I would say that as you think about your competitive advantage of what you want to build over time the narrower the better in fact I'm very skeptical when I hear people talk about very broad competitive advantages and I'll give you an example so I was fortunate enough to lead uber's b2b products during the COVID pandemic and it was pretty brutal because from a business perspective almost from one day to another nobody traveled for business anymore and so our business didn't quite go to zero but it went close to zero and so we had to use the time to really figure out how can we build new products that can help our users in other ways even if they aren't traveling and it helped us put the foundation for not a new products and part of when you've been in a company for a long time there is a drawer of old ideas and one of the most common ideas at uber was hey let's build ads we have people's attention and in fact the word that most people say is they call it captive audience I don't like the word captive audience it makes me think like okay hurry up lock the doors drive somebody to h&m and buy a shirt it's not how it works right so I think but more fundamentally I also think if you think that uber as a company because we facilitated your ride we have your attention all through that ride I think you're fooling yourself and the data point I have is there are countries for instance in New York city that have advertising in the in the cab and it's I'm not personally a fan of it but I can tell you for sure it definitely does not have my attention and so one of the breakthroughs to really build a much better ads product for uber was instead of saying like hey you know people are paying attention to uber when they are in their in their ride we wanted to identify the specific seconds that you are paying attention the most narrow benefit you can think of and so it turns out that there are there is a moment where you're paying attention so generally if you order an uber you put in your destination and then there's a moment where uber is trying to match you up with a driver it's this screen if anybody has seen it when you are looking at this screen you are paying attention I guarantee it and it's only a few seconds and so when we made the first rider ads we put them there because we had a very good understanding of what is the exact moment we have your attention and so now we put it here and we put it in other places and this next year just because we understood the difference between attention more broadly speaking and the specific seconds of attention and intent we built a one billion dollar business and so it matters a lot that you understand the specifics define it as narrowly as possible and be skeptical if you think your competitive advantage is a very broad one so these are my points I would say focus on being the best not the first protect your velocity it's not always popular to protect velocity and you know if you look at the companies that I worked at the early days there are a lot of more controversial takes on how to protect velocity early Facebook for example had a rule that when a software engineer started they had to publish code to production the first day they started that's a great way to ensure that people are moving fast but you can imagine the laundry list of concerns and quantified risks it is to have new employees start with production at uber we had a cultural value that was called toe stepping and it's usually brought up when we talk about uber's toxic culture but the thought behind it was that uber our founders sort of recognized that when you defer discussion when you defer confrontation things end up moving slower because you and so the implemented a value called toe stepping and so these these elements of protecting your velocity often come across as a little unhinged and it's also like very hard to quantify what does it actually drive in terms of velocity and so my position to you all is try to protect this as much as possible be unapologetic that's what all the early founders that have built great products have been and it's very easy to lose it even when you're one through three four five employees develop competitive awareness not obsession so build a system check it weekly identify your leading product indicators and i'm happy to give more details during Q&A if you have specific products focus on customer behaviors what are they actually doing make sure you'll see what they're doing not what they're telling you they're doing and then pinpoint your precise advantage and so um i would end on on on this quote because i really think that why are we here why are we here at slush are we here at slush to follow other competitors no we're here to drive innovation right we're here basically to not follow the paths of others but to find our own path and and leave a trail and so i'll leave you with this i wish you all the best on your trail blazing uh i'm at the conference come find me add me on linkedin and thank you very much