 Such an honor to be for the two of us to be here. I was supposed to be here a few years ago But I had to flake out the last minute and finally made it this year So we thought we would we're just thinking about what we'd share Here and we thought you know what let's talk about like really practical stuff that we've learned Shredder and I have known each other for a little too long a little too long. Yeah Since then of high school actually we're roommates in college and we've started And exited a number of companies together. We've done four companies so far and So we thought we'd share three general things one is Just founder relationships, you know, what have we learned by being founders with each other across four companies? 20 plus years doing it. We've known each other for 10 years before that and That's the start second is we're gonna Blitz through a list a checklist of things to think about And our opinions of each of these topics when you're you're founding a company and But lastly when talk a little bit about what we're excited about the future and so Three things so on the founder relationship side, right? Three topics really and you know, feel free to button whenever right? Yeah first is Setting the assumptions in place, you know, you're working assumptions when you start a founders code That you're gonna agree to Yeah, so one of the things that we did because when we first got started we lived in the same apartment And worked on the same apartment and we were roommates in college So we kind of understood, you know how to deal with each other But we had to set ground rules and that was key We actually wrote it down in like a five-page document and we signed it and it was explicitly laid out things like How what our weekly budget was going to be for food and it was a $20 during the week and $20 on the weekends Taco Bell and yeah, Taco Bell there pretty much every night But what what it what it did was it enforced a certain level of discipline that we write down exactly what our expectations were and That was pretty much what kept us sane Yeah, and also, you know, it was like ground rules to you know stuff like Quiet time so that we would leave each other alone because we're in such close quarters How to not get sick of each other that kind of thing Yeah, and so one of the most important things that we did out of that That came out of that relation those guidelines were giving feedback to each other and we had a very very I get a very structured way Of giving feedback that we used to call cluelessness sessions the idea being that well if you're doing something stupid It's not because you're a bad person. It's because you're clueless about it, or you're just being stupid So that happens so how to prevent stupid attacks for each other and we figured, you know It's founded the basis for it was that we cared about each other that we cared that the other person would do better And so we over the years we've used this cluelessness such feedback session type of thing across all of our companies and I think it's worked out pretty well We're still here still here Still doing companies together and so we actually it's a fairly detailed process and a Kind of a document if anyone's interested you can email us we could share with you with a very detailed Way that we did it but like one thing that's kind of characteristic about the this bilateral feedback thing is that When I give feedback to Shridhar, he can't respond He has to wait actually until the next session, which is six weeks away before he can respond So it's two unidirectional feedback Cycles the core tenant was you can't respond because you can't get defensive the whole assumption here is it doesn't matter if I screwed up I need to hear it without any without being defensive and that core tenant actually has kept us sane for the last 20 years Yeah, so we've done that we've done it with our with the team members and employees and whatnot. Yeah You shouldn't do it with your wife probably not a good idea. That was that was I think I might have tried that once Yes, you did not a good idea. Yeah So we have another one that we called the the buck stopping protocol or BS protocol for short And really that all that means is Division of labor and who has the final say in particular decisions and when we did our first company I was on the technology side and sunny was on the the business side And we had a very clear division of what we owned and at the end of the day We could argue all we wanted to but one of us had to you know the buck stuff with somebody on certain topics So there you go three things to put into your founders code when you're starting a company Right a founder have to have one feedback and transparency and a clear division of labor so that You know the buck stops with someone with one of the two or however many founders of you When it comes to a certain domain So that's I don't know we'll move on to we're gonna jump into a rabbit fire list of a checklist of things to think about when you're Thinking of founding a company or as you're founding a company any how many people how many entrepreneurs in the audience here? Love it my kind of my kind of people my kind of conference right so this is for you and maybe you've already thought about this You know, but this is stuff that Came to our minds when we thought what's gonna be really useful to know or to think about when you're founding a company All right, so I'm gonna go Equity split who owns what of a company when you start a company? Okay, I am dead set against equal equity split if you got two founders. It should not be 50-50 Not 50-50 50. All right. There you go Somebody has to take charge it is one person's company more than the other and that helps with the bucks buck stopping protocol Buck stopping protocol. It has to buck stop the buck has to stop with someone, right? Yeah So two companies go when we did Akim matrix Shredar had owned more than me. It was very we were very insistent on that from the beginning at misfit I own more than Shridhar and And then at elemental Shridhar's, you know Shridhar's the man Division of labor so basically again, it comes down to setting expectations right up front and writing it down and Reviewing those Responsibilities over and over and over again when you work very very closely with the co-founder you're reviewing this on a daily basis But as the organization grows what we had to do is actually step back once a month once a quarter and say are you Are you still doing this or do you want me to do it and that a regular review meant that we could both grow as founders I started up doing, you know lab work and and science at the bench and towards the end of And no seven eight years later I was also involved in business negotiations and you know on the flip side sunny you and that was it pretty much I was pretty useless for anything other than business stuff talking about what you did Well, you raised money. That was very important board structure okay, so Again for all the founders out there grab as many founder seats as you can on the board because you will lose them over time and That's that's really served us really well And over the years is that you want the company to be built by the founders and guided by the founders And the only way you can do that is to assure that the board dynamics are are equitable in that sense Yeah, very important like when we did misfit it was we were three founders Two of us plus John Scully and three board seats and we kept that throughout the whole cycle through Seeds series a series B series C. It's very important. So totally agree with you on that personality dynamics all right equal opportunity for all or a Talker see a talker see over a democracy. All right. You heard it first. Yes. Yeah, I start up is not a democracy So, what does that mean? You're just gonna be a tyrant through if through all the companies You have to be a gentle tyrant and understand what's right for the company and not always lead by consensus we talked about having a confederation of autocracies within a company and I'm definitely a fan of that How about spending ethics like how to spend money? Yeah, big topic definitely something to talk about before It's like before getting married or talk about your spending ethic Yeah, it's almost like it is very much like a marriage You know marriages fall apart because of financial disagreements all the time So it's very hard to get divorced if you found a company together, right? so No simple ethic is be cheap don't spend money Be cheap and don't spend money Can you explain on that? Yes, but not to be penny-wise and pound foolish But the key is to be aligned on what you're gonna be cheap about So strategic cheapness strategic cheapless I would add shameless cheapness to it a bit more and One way to think about it one thing I've told like my entrepreneur friends is just think if you are seed funded Every dollar that you spend now is worth probably three dollars Probably in just a year's time when you raise a series a assuming that's the milestone you hit the milestones, right? And then maybe a year and a half year year and a half after that. It's probably worth another two dollars So within two years one dollar will have been worth six seven dollars later So if you're going out and having a really nice meal $100 meal $700 meal two and two years from now. So keep that in mind in terms of time value of money and value of money now Especially the earlier you are right. I guess it's an obvious point Hiring philosophy. Okay. What do you think? So first of all The way you build your company The way the company grows is entirely dependent on how you hire and what kind of people you bring on board So how many people have heard the the expression, you know, you have to hire the best people? Yeah, hire the best hire the best, right? Okay, so I challenge that and we actually do not hire the best people instead we hired the best people we can afford and there's a big difference between that because Even you always trying to hire the best you kind of you kind of take for granted what you're not hiring Because you can get one amazing engineer and not afford anyone else. It can't afford Qa can't afford testing can't afford support So what you do you have to balance it but isn't a player worth five B players There's there's definitely something to be said about getting Good people not necessarily the best. So really what I'm saying is you're you're you're promoting your you're suggesting We should only hire B players No, well, I hired you right? Rightful for the job. Yes No, it really comes down to hiring what's good enough and what's appropriate for the role so many times I've seen people over hire because they had to get the best person for this and turns out There's a lot of grunt work and start-up life and sometimes the best person for that role Isn't gonna do that grunt won't put up with it won't put up with it Yeah, and so hire appropriate and you know, there's always this other thing about you know Now what what you make up in quality you make up in quantity it's sometimes you saying quantity over quality I am saying quantity over quality. Wow, you heard it first here at slush. Yes quantity over quality Yes, I think let's take that in context. What do you mean by that exactly? Okay? Well, what I mean by that is oftentimes you just need grunt, you know manpower to get stuff done And when you go out there and spend your capital on hiring the best tech talent out there You're not gonna have an army of people that can go out there and do the grunt work And so many many times the way you succeed in startups isn't because you have a magic formula It's because you crank the wheel a million times and to do that You need to spread your capital out and not necessarily the best people for those roles are going to be the most effective Let me insert a couple more things about hiring philosophy something that we've agreed on over the years One do not hire in desperation Every time we hired in desperation like oh, we got to have this person that person good enough. Come here That's not what we mean by good enough. That's good enough because you have to have it right now Yeah, don't hire in desperation. It almost never works out and There's a few things that we learned over the years, you know in our first company fire spot, you know machine learning language software And we would try to hire really smart people Realized it's not what you need. You need to hire people with great skill It's not just about IQ. It's about relevant skills And we actually had a lot of like ego problems in the companies We had all these smart people, you know how to show that they're smart second company We thought okay, let's get some experienced people Yeah, and you know the experienced people actually brought a lot of knowledge to the table But when you when you hire for experience only what ends up happening is they're not gonna roll up their sleeves And they're you know, they're not gonna do the grunt work And so there's a balance between you know getting inexperienced but heavy lifters and experienced people who may not be heavy lifters And you have to be careful about 20 years experience means, you know, yeah, 20 years of bad experience is still 20 years of bad experience Yeah, that's like one year of experience 20 times not the same thing We're looking for so what we found was that we're looking for wisdom not just experience third company time around when we did misfit We realized cultural fit above all, you know Because you can gain skills you can gain experience, but changing one's heart changing You know whether people can look out for it after each other or not, you know, it's not it's not trivial So cultural fit was was really important So let's move on very briefly at this point, you know, let's talk about the future what What are you excited about? So what's what do you know? Well, I mean you look around this conference and you see the excitement over science-based companies There's a lot of investment going into into science and you know, five ten years ago That wasn't the case where the the predominant VC sentiment was that we don't we don't invest in science experiments And yet now VCs are absolutely investing in science experiments So I'm excited about about core scientific Technologies coming out of the labs and going getting into the market Tell them about elemental what you're doing now. So at elemental The core principle about what we're doing is actually we're building tools for scientists We're building tools for people who do synthetic biology material science and drug development and the the the the main tenant that's holding people back in our opinion is Experimentation and the ability to reproduce your results over and over and over again in a way that proves a principle de-risk the science and most importantly makes it manufacturable at a low enough price point that you can go into the market and underpinning all of that is being able to collect enough data on your experiments and being able to sort through that information and Present it in a useful way so you can build products on top of it So at elemental we're building sensors and connected devices and machine learning algorithms on top of all these sensor streams So that scientists can actually accelerate their work Pretty cool. Yeah, it's good stuff elemental machines I think the only thing I can get credit for for doing much of that is the naming Yeah, that was cool. Yeah, I did something, you know But then on the on the flip side what Sonny and I are both doing is Investing and mentoring a lot of science-based company. You've been involved in some really cool companies Look if there's one thing I learned from Previous companies, it's that if you want to build a 10x company You either have to have 10x technology or science something. That's really like kind of gives you this unfair advantage or you just have to work 10x harder and You know, I'd like to just have that advantage. I don't know if I want to work that hard You know, it's it was it was a rough time the first few startups worked very hard for a couple decades And so I'm excited about science stuff that really makes this a phenomenal difference So most of the stuff that we've been doing Has been around material science semi-conductors food biotech. So involved with Account a material science company called matrix that does thermoelectric materials that's Going to revolutionize the refrigeration world really excited about that and Perfect day you heard you guys heard from Ryan and Paramal yesterday one of my favorite companies and I have the privilege to get involved early with them and they're gonna produce dairy For the world without cows. I mean, it's it's gonna be it's gonna be phenomenal And so things like that will really that have a universe denting possibility impact. That's what I'm excited about these days So what's next? What else? you know, what do you think about we thought we just we've just been bloke first of all we've been blown away by By Helsinki by Finland, you know, we came here kind of you know expecting cold and wet which we're finally getting you got um But yeah, what do you think? So this is this the Helsinki is is is awesome and I was just thinking like I wouldn't mind having like a summer home here Summer home in Helsinki. How cool is that? That'd be cool. I'd you know, I was thinking a winter bunker in the northern Finland How about that? All right All right, all right. All right next startup idea winter bunkers in northern Finland. So who's in Lapland? We're gonna get a couple acres of land and build a winter bunker nuts. Gonna be new startup heaven There we go For a slush next year next year. Yeah. Thank you so much. We're gonna be taking some questions at the I think founder studio or something like that. Um, so come over You know, ask whatever you want beretus Come I'll disagree with all the stuff we said. We'd love to hear from you Great. Thank you all very much for listening to us. Thanks