Building Zapier from first principles | Contrarian takes on growth, hiring, fundraising | Wade Foster (Co-founder & CEO)
Episode 107

Building Zapier from first principles | Contrarian takes on growth, hiring, fundraising | Wade Foster (Co-founder & CEO)

Wade Foster is the Co-founder & CEO at Zapier, a platform for building workflow automations without a developer. Zapier was started during 2011 in Columbia, Missouri, and by 2021, it was valued at $5b, having only raised $1.3m.

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Wade Foster is the Co-founder & CEO at Zapier, a platform for building workflow automations without a developer. Zapier was started during 2011 in Columbia, Missouri, and by 2021, it was valued at $5b, having only raised $1.3m. Prior to founding Zapier, Wade had just two professional jobs, and had never managed or hired anyone. He worked as a PM on a web app used by 20k students, and as an Email Marketing Manager at Veterans United - a role that had a significant influence on Zapier’s eventual success.

In today’s episode, we discuss:


Where to find Brett Berson

Where to find Wade Foster

Where to find First Round Capital:


(05:46) The fascinating story of Veterans United

(06:55) Lessons from Veterans United

(08:35) The most important things Zapier got right

(10:13) How Zapier built their powerful distribution engine

(16:56) Why Zapier didn't move to focusing on enterprise

(19:06) How Wade thinks about product market fit

(24:26) The role of skill vs luck in Zapier's success

(26:23) What was hard about building Zapier

(30:03) Key lessons on people management

(32:35) Rule of thumb: "don't hire ‘til it hurts”

(36:42) Zapier's #1 hiring mistake

(42:50) How to test for scrappiness in the hiring process

(44:31) Do hiring playbooks transfer between companies?

(50:01) The 12 year evolution of Zapier's product

(53:20) How Zapier makes product decisions

(55:40) How Zapier thought about competition

(60:11) How to foster intellectual honesty in yourself and your org

(65:35) The people who most impacted Wade's worldviews

Brett Berson: Well, Wade, thanks again for joining us.

Wade Foster: Yeah. Thanks for having me, Brett.

Brett Berson: So to kick things off, I think one of the things that I was reflecting on, on Zapier and sort of your trajectory building the company, is that there are a lot of things that you've done across the business that were certainly counterintuitive at the time. So you raised very little money before that kind of became a meme in Silicon Valley.

You were fully remote or distributed long before the pandemic happened. Um, You charged early on, you built something that was PLG when there were only a small number of companies at the time that were building that way. Um, and I'm sure tons of other stuff that I didn't hit on. And I'm curious,, like, what do you make of that?

Do you think about the world in that way? Or like, what are the conditions that lead you to a lot of these decisions in the way that you've chosen to build product, distribute product, build the team, etc.

Wade Foster: Yeah. Um, when you add them up like that, there are a lot of weird things that we did. Um, you know, My co founders and I , we're from Columbia, Missouri when we started the company. And, you know, some of the things we did were just what we had to do to make it work. You know, you start a company in 2011 in Columbia, Missouri.

It's not like you have people knocking on your door to give you millions of dollars to start a software company. Like that's just not the environment that we were in. You combine this with you know, one of our, our key reference points was this company we were working at, Veterans United, and um, you know, it's a incredible company in Columbia, Missouri, it's owned by two brothers, 50/50, and, never raised any money, they'd built a couple of companies before and sold them and done really well. They're kind of like the entrepreneurial, you know, poster childs there in Columbia, Missouri. And uh, you know, I remember I joined there in, you know, early 2011 was like the 500th employee. And by the time I left 10 months later, just as we were starting Zapier, there was 1000 employees there.

And so our reference point is like, well, here is a incredibly fast growing company, one that is doing exceptionally well, has an actual business, like they're making money um, making profits, and they're doing it without raising a dime. And so, you know, we have these reference points that, you know, are just like in stark contrast to this conventional wisdom. And so you know, I think it always just like it's like I had a little bit of skeptical ears when you would sort of hear, you know, the Silicon Valley advice around like, well, you can't build a company that way, or you'll never be an important company doing it that way. When, you know, we sort of had like example number one right in front of us where we'd experienced it.

And so I think those like early experiences just made me like a lot more questioning about those things. And so we really just tried to get to the heart around like why, why advice was the certain way and then like really understand the situations that we were in. And, you know, how does that map? Does that advice apply to us or does that advice not apply to us?

And if it didn't apply to us, we just say like, well, that's good advice, but for a different company, not for this company. and, and, you know, that just kind of was like the general framework as we were thinking about, you know, decisions around like, Hey, should we raise money or not? Should we be an office culture or remote culture or whatnot?

It's like just really trying to deeply understand like the cards that we were dealt and if the advice applies in the situation that we've got.

Brett Berson: So what's the story with Veterans United?

Wade Foster: there uh, it's the third company, these, the Bukowski brothers and, and Columbia started. And uh, you know, they, it's an incredible story. You should have them on the pod. Um, really good at online marketing, like really good at PPC as they called it back in the day, paperclip. And um, one of the things they started as was they got really good at uh, generating leads for a VA home loan.

 And then one of the things they figured out was it's more lucrative to actually underwrite the loans. So instead of selling these leads to banks, they just created it themselves. And you know, one of the first sort of like end to end businesses specializing in a VA home loan in the United States.

And uh, I think like it's them and then USAA that are the two big companies in this space at this point in time. But uh, one of the things that was interesting about them was during the financial crisis, all these mortgage companies are doing horrible because of just well, it's a housing crisis.

And the exact opposite experience for them because they're selling a VA home loan, which is backed by the U. S. government. And so that type, that particular type of mortgage did exceptionally well. So when everyone else was struggling, they were doing really, really quite well.

Brett Berson: Are there specific um, insights that you took from working there that have kind of expressed themselves in some way in the Zapier journey?

Wade Foster: I mean, one like little nugget that I do distinctly remember is they also had this other company that they so much easily titled plus one marketing and the plus one just sort of stood for this idea of every day you show up, just make things one bit better. And, that can just get easily lost.

When it's like, hey, these grand strategies, these grand visions or whatnot. And so much of company building is literally just like, showing up day after day and doing that for a really long period of time and just putting in the work. Like building companies, building startups, it's not a particularly glamorous thing in spite of what like the media may make it look to be, to be, or like things like the social network might make it look to be. Like a lot of it is just doing sales or doing customer support and just doing it hundreds of thousands of times over and over again and just being really committed to being exceptional at that.

And so like that concept of just like showing up and doing the work like, just kind of stuck with us.

Brett Berson: Why do you think that is maybe underappreciated?

Wade Foster: I think people just generally don't like hard work, which I can understand that too. Like, uh, but you know, the people that do the best are like, you know, like high performers tend to always talk about how they love the work that they're doing. Um, where like, you could not pay them and they would still want to do those things.

Um, it's just a thing that is like, innate to them. Uh, and so I think like, if you find that that's a really good place to spend your time. Um, most people don't ever find that. I think most people, you know, sort of settle for like, a job that's different from where their passions and interests lie. And so as a result like, that plus one, that showing up day in and day out is maybe a little harder for most people.

Brett Berson: So maybe in slight contrast to this idea of kind of grinding out 1 percent improvements for a decade, or maybe that's a part of it, I'm interested when you think back on the path thus far, are there a handful of decisions that you ended up getting right that you think have really led to the company working in the way that it has?

Wade Foster: Yeah, I think every company sort of has this where there's, you know, a few key ingredients that really, really work. And then you just hope that everything else you do doesn't hold you back, you know, so for like Zapier, you know, we, we figured out how to, a really good distribution engine that meant our customer acquisition costs like rounded to zero.

And you know, I think if we had not done that, like we would look a lot like a lot of other enterprise SaaS companies do, or maybe not even exist at all.

Brett Berson: What else would you put in the list of the most important things you got right?

Wade Foster: I mean, I think that one's probably like tip top of the list. Um, you know, the, the distributed work thing maybe we could have done it without that, but it certainly made it a lot easier for us as a young company with very little hiring experience to compete for talent. You know, just saying, Hey, we're not going to try and go toe to toe with Google or Facebook or Netflix or whoever trying to hire Bay Area engineers and saying in 2012, literally saying like, we're going to go compete for all of the great talent that doesn't live in the Bay Area.

 And the fact that there was maybe, you know, half a dozen tech companies of like, name that were doing that at the time, you know, there were more than, say, 10 or 50 employees um, doing that. That really gave us a, incredible advantage um, trying to attract top engineering talent, top talent, really, in any function.

Brett Berson: So on this topic of the distribution engine that you've built, what's sort of the founding story of that part of the business?

Wade Foster: You know, there's really like two pieces of it, and if you tried to replicate it today, like you couldn't do it because everyone has copied what Zapier has done now um, and it's just too competitive, but at the time, you know, when you would go search for integrations, the results, the keyword results that would show up were a bunch of like, just kind of like junk pages.

Like, you'd get like a pastebin result that like had API docs and stuff like that, which is not what people were looking for. Most people were like looking for a product that says, Hey, I can just integrate, you know, Salesforce and Zendesk. I can just integrate um, PayPal and QuickBooks. Um, one click, like they wanted a SaaS product.

They didn't want. you know, an API at the end of the day, and so we had read, there's like a patio11 He's like famous on Hacker News, you know, Patrick McKenzie he worked for Stripe for a long time, but way before those days, he had this thing called bingo card creator, and he'd written a lot about how he did content creation for bingo card creator, and he would spin up these landing pages for every type of bingo card he could think of, you know, he'd have like a physics bingo card or, you know, a US history bingo card, a world history bingo card. You know, states of the, you know, the, the company, the country bingo card, anything you could think of. And he'd done the math on it and it, you know, he'd had a, a person that he paid like, I don't know 10 bucks to generate every one of these, to come up with a list of, you know, bingo card things and put them into this little CMS and it would automatically generate a page.

And I think it cost him like 10 bucks to do that. And he had figured out like for every page he spins up, he makes 20 bucks. And so he just created this little engine where it was like, you know, 10 to make a page and I'll make 20 of sales every single time. You know, 20 sales is not a lot, but it's like, the number of ways that you can create a bingo card are conceivably infinite. And so if there's enough people searching for that specific type of bingo card, you're going to really rank quite well in Google for this. And so we saw that and we're like, Oh, that's interesting. Um, integrations is kind of like that. If you're looking for integrations, there's all these different keyword results that you could conceivably rank for, but no one is trying to rank for this stuff.

Uh, If we had a landing page that said you could connect Salesforce and Zendesk, or you could connect QuickBooks and PayPal, that would stand out. So, you know, we made an app directory that, you know, has a nice panned page. It describes how you could connect these things. You can sign up for free. Um, and pretty quickly, you know, Google indexes that and says, Hey, that's the best page or like the best two or three pages on the internet for that specific type of query.

And, we start generating traffic from that. And so as a result, like if we really wanted to grow, all we had to do was we just need more apps that we support on Zapier, we need to connect more things. And, uh, so that's what we did. We started just building integrations ourselves and every new app, like spins up n+1 you know, sort of new landing pages. And, the question just becomes like how, how fast can we go to get high quality integrations on the platform? And then you combine this with, you know, about a year in, we launch our integration platform and other people start building integrations for us. And now the engine just starts to hum where we've got people building integrations and that's automatically spinning landing pages and that's getting more traffic in.

And that's attracting more folks to build landing pages. And you get this just really good flywheel going. And as a result, like we're growing quite quickly and not having to spend a bunch of money on sales and marketing to go do it, which is quite exceptional for, you know, a B2B SaaS software company.

And like I said, like you could go try and do that today, but in our category, it wouldn't work because like you go do those searches and you see a list of search results that's a lot more competitive than it used to be. So it just wouldn't work as easily as it did for us. But you know, I think for another type of company you might have similarly underappreciated growth advantages that are just sort of like sitting there untapped.

Um, that a person just hasn't connected, you know, two and two yet and figured out how to do it.

Brett Berson: at what point in the company's life did you figure that out?

Wade Foster: We had that idea on day one.

Brett Berson: Before you built the first product? I think the founding story was you, you had somebody trying to do something with their email list right?

Wade Foster: One, one of the first customers was doing that, but the app directory existed before we had a customer. It was just like, Hey, we'll build this like little app directory, see if we can get people coming in through search and if they are like, you know, we can build a product. You have to think like this is 2011 too this is like when lean startup methodology, customer development is like kind of all the rage MVP was like in vogue.

 You know, build like a landing page, get some emails. Go talk to em see if you can build the thing for it. Like that, that was kind of the style of product development we were doing at the time.

Brett Berson: And so were you thinking about, Hey, I think there's this problem to solve, for this to work we have to figure out distribution, how can we figure out distribution? Or was it there's some sort of luck condition that you just bumped into this thing?

Wade Foster: I mean, you need distribution. And for us, we felt like, well, if we're going to build software, like we want people to use it. So yeah, we should be thinking about distribution from day one. I think this is one of the biggest things that like founders over- especially product minded founders overlook is they say, Oh, you know, I have an idea for product X, Y, Z in this category.

The incumbent stinks for these reasons. And I think I can make a better version of it, right? I can make a better Salesforce or I can make a better whatever. And they go make a better whatever. But then they realize. The thing that actually helps Salesforce win is not necessarily that the product is amazing.

It's that they have this incredible distribution engine that is really difficult to compete against. And so you know I think the best founders are thinking about that and figuring out like, I mean, product market fit is not just about the product. It's about the market too. You need these things to like coexist.

And in many ways, that's what made Zapier hum is that the product and the go to market motion are inextricably linked. They work as one fluid motion. It's not, we built a product and then we figured out how to like, you know, latch on and go to market to it. They were built as one in the same thing.

Brett Berson: And out of the gate you saw the world in that way?

Wade Foster: 100%.

Brett Berson: Because of some of the reading that you did or? 

Wade Foster: It just sort of made intuitive sense where it's like this bingo card creator thing like is winning this way. Like, why couldn't other people work this way? And we were fans of things like you know, Basecamp and MailChimp and stuff like that. And they were doing a good job of just drive traffic to a landing page.

You know, you could sign up for free, get started. And so for us, it was like, it just sort of intuitively made sense where it's like, you know, we know from Veterans United how to like drive traffic through search. Uh, you see what these other products are doing. And you're like, if we can just get traffic, drive them to a page on the internet, and then the product underneath supports the problem that they're trying to do.

 All of that just intuitively made sense to us. Um, It didn't feel like rocket science, I guess.

Brett Berson: Did you feel tension along the way to diversify and do all sorts of things outside of that? Or did you have an opinion on this machine? We really understand this machine, we're not deviating to kind of the way the gears operate in this machine.

Wade Foster: I mean, the biggest one was the questions we would get is like, you know, why are you not doing more enterprise? Like you should go enterprise. That's where all the money is. And um, I mean, maybe that is still true. You know, I think we are gradually sort of expanding our business up market. Um, We're still not an enterprise company.

We still, like, SMB is our bread and butter. That's who we solve for. I think SMB and like the people who use the internet and the people who use software is just way bigger than folks realized, you know, 10 years ago. And we just sort of felt it like, you know, we could see people using these products.

We could see the adoption coming onto Zapier. And we just kind of followed our nose. It's like, what were our customers then asking us for? You know, were they asking for enterprise software integrations? Or were they asking for us to connect into yet another one of their B2B stack? Once you had the engine going, it was really all about, okay, how do we just integrate with more things?

And then the question is like, well, what things? It's like, well, we already have these customers or we have these people showing up on our doorstep asking us, will we integrate with these other things and it really became more like an order request form, which is like you want to integrate with us?

Great. Let's go figure out how to get it done. Versus trying to dream up some like different grand strategy was like this one's working, let's really get it working. Let's not lose this like momentum that we've got humming, um, to go chase this enterprise thing that candidly we just didn't know how to do that.

Like we knew how to do this thing. The other thing felt like something other people knew how to do. Um, and like maybe we could have brought somebody in who could have helped us figure that piece out, but we felt like the engine we had was the one that was working and the one we wanted to figure out how to scale at least for the foreseeable future.

Brett Berson: The way that you sort of articulated, it sounds all very simple. Do you think it's actually as simple as you're making it sound and it's just kind of intuitive and kind of got working, and double down on what's working, or is there actually a lot more complexity with it all and you have a unique ability just to simplify things down?

Wade Foster: I mean, so the thing, one of the things I was doing before Zapier, I was working on this, software company in ed tech. And I was brought in as like a marketing intern, small company. And they were like, you know, this product isn't selling, figure out how to get more people to use it. And I'd never really done it before.

And so I felt like Okay, I got to go figure out how to do this stuff and I was learning SEO and email marketing and biz dev and sales and you know, just everything I was trying everything to try and get this product to sell, to sell. And nothing was working like it was, it was literally like how most people describe starting a company, it's like pushing this boulder up a hill. And you're like, why won't this thing work? And the more and more I did that, the more I started to think I think we just have the wrong product. Like, I think we're just like building something that's, you know, the product itself was slick. Like the design was good, well engineered.

I think ultimately it was just not like, it was sort of like a, you know, it's classic like solution in search of problem. Um, and so I had that like, I'd had that experience., you know, my co founder, Bryan, similar thing, like he'd built, he was, you know, kind of solopreneur, solo dev, and he'd built probably like a dozen apps that had all are sort of all lost to the internet archive.

None of them, you know, managed to earn him much money at all, much less get many, you know, customers. Mike had the same thing, you know, with a couple experiences. And so we, we'd sort of been doing this stuff uh, separately and had these like experiences that were not like winners like Zapier has become.

 But when we started Zapier, it was like the pieces did lock together pretty, in a pretty pure way um, you know, the, the ideas behind the app directory played out the way we thought, you know, we knew that there was demand for the product because you would go to all these community forums and people would be asking for integrations with other products and, you know, the list of people saying plus one was pretty long and a product manager would show up in those threads and say like, Hey, great idea we love what you're suggesting here, we'll go consider it, which if you've worked in one of these companies, you know, is like PM speak for probably not going to happen. It's going to go on a backlog somewhere that nobody's going to pay attention to. And so we're like well, clearly there's demand for solving this integration problem.

 Put this way in which we are thinking about it actually work. And so, you know, the novelty we had was, hey, we're going to build this like hub and spoke model where you can, you know, plug in one app on one side, that'll be a trigger. And then you can have another app on the other side that will be an action.

And then the user can mix and match these things. So you don't have to do, you know, sort of like point to point integrations. You got this nice hub and spoke model to sort of use airline lingo. Um, and it made it much more easy to integrate the universe. Then the challenge on the self serve size was like just getting it to be easy enough.

So I remember like the first customer we signed up. We had always envisioned it as a self serve product. And so we gave him access to the, get- shared him a link and said, here's, here you can sign up and go try it out. And he couldn't figure it out. He emails me back and says Wade can we jump on Skype?

Can you show me how to do this? And, you know, I jump on Skype and I watch him trying to set this thing up and he just clearly can't get it done. I mean, it's not even a beta at this point. It's like an alpha of an alpha. It's like the earliest release. And there's so much like just jankiness in the product that I was, I mean, I was, I was embarrassed.

I was like, okay, I'm going to help him get this stuff done. But the catch was we get to the end and this is the customer that was trying to get, you know, folks from, he had a contact form on his website, powered by WooFoo, and he wanted to send these folks over to an Aweber email list. And so we get this app set up and I was like, okay, let's go test it.

And you know, it goes and fills out his contact form on WooFoo. And then we go check in Aweber, refresh the page and see like, Hey, the email address in there. And it is. And he's like, Wade this has kind of changed my life. And I just remember thinking there, I was like this is what it actually feels like when you make something somebody cares about.

It's like the opposite of that experience at the ed tech company. Like this product is bad, the design is not great, you know, guy needs hand holding through Skype every step of the way, but we get to the finish line and it solves a problem for him in a way that he's like, actually asking me proactively, can I give you money?

We don't even have a way to take money at this point in time. And so that's where I was like, ah, this is going to work. We just gotta make it way better than it actually is today. And so it became a, instead of a like invention problem, it now became like an iteration problem and it's much easier to iterate than it is to invent.

And it was just like, how can we take this really crappy first draft. And really make it to something that someone could sign up for in a self serve way and get going. And so we just rinse, washed, and repeat that experience over and over. We'd take, you know, a customer that had come to the site and said, Hey, I want to connect to this.

I jump on Skype, watch them try and use it. Take a bunch of notes on where the person would fall down. Go back to Bryan and Mike and say, here's all my notes. I think this step is really tough. This stuff is really tough. Then we do it again. And we just keep doing it until more and more folks would just go through the setup process.

They'd need less of my help. They'd figure out more and more of it on their own. And as that started to happen, you know, we started to think like, Hey, I think we maybe we could open this up to the public. I think we got it. And so, you know, I do think in this specific, in this case of Zapier yeah, a lot of it just sort of seemed like it worked.

And it's kind of because it did. But that's not normal. Like the stuff we'd said before that was more the normal stuff, like mostly doesn't work. It mostly is really hard. And so I don't know like, there's this thing when people ask me, like, how do you know if you have product market fit? And I always like well, you know, because people want what you have. It's not actually that hard if people actually want what you're selling. They don't want it? Then everything seems hard, everything feels impossible, yeah, so I guess that's how I think about it.

Brett Berson: Do you reflect on sort of the interplay between skill and luck in the last 12 plus years in building this company?

Wade Foster: There definitely is a luck factor. Uh, timing, for example, is a big aspect of this. Like, you know, we start the company in 2011. That's the year that Stripe started, Twilio started. Most of these companies, like a Zendesk, a QuickBooks, and whatnot, they're on V1 of their APIs.

So there's the- public APIs are sort of starting to be a thing. Um, if you tried to build a company like ours before 2011, I don't think you have like all these APIs that you can go connect and do this stuff. Like most companies aren't building and doing stuff in this way. If you try and build it, you know, a year later, there's already other companies doing it.

There was, There was probably a half dozen startups that had a similar idea in this timeframe, give or take. And as far as I can tell, more or less came up with the ideas fairly independent of each other. So like, that's definitely like, we just lucked out in timing.

Like we, you know, we could have been early. We could have been late. But then there's the part of it, like you said, around like the plus one marketing thing, like show up and do the work every single day. Like, you know, we, we've worked hard on this. Like we, that definitely is like a skill aspect where it's like, and an effort aspect.

Um, I mean, it takes both. You know, you're not gonna, you're not gonna succeed without both. I look at, I mean, again, on the luck side, like we went through YC summer of 2012. There's definitely way smarter people in my batch than me, than us. A hundred percent. There was a person in our batch that beat the Massachusetts lottery.

I remember seeing that and going like, Holy cow. How do you do that? Like that seems insane to the 24 version of myself. There's people way smarter than us, but in hindsight, like most of those companies, like we're one of a handful of companies from that batch that have you know, lasted the, you know, a decade plus at this point in time.

Brett Berson: And so what did that teach you?

Wade Foster: It takes a lot of stuff to build. You gotta get a lot of stuff right. Like, like you said, it's luck. It's skill. You know, there's a whole bunch of skills, too. It's not one particular type of skill. Like, you have to have a confluence of different types of skills to get it done.

There's perseverance involved. Yeah, it's like a lot of, it's like a lot of ingredients that it takes.

Brett Berson: I think you're kind of getting at this a little bit, but if a bunch of the early direction intuitively emerged for you and the founding team. And it was relatively easy to figure out kind of let's keep doing this thing and compounding and compounding. When you reflect, what's been like exceptionally hard? Other than maybe working intensely for well over 10 years on a single sort of company.

Wade Foster: All three of us are first time founders and first time more or less in the workforce. Like I had two professional jobs before Zapier, never managed anyone before, never hired anyone before. So pretty much everything that is not like building, you know, sort of like basic MVP, basic product, basic, like go-to-market motion stuff.

Everything else, we had to learn how to do that in real time, and, uh, some of that was easier, but a lot of it was really hard, like everything about hiring teams, building teams, uh, building executive team, uh, learning how to manage folks, learning how to hire/fire, uh, learning how to coordinate all of the stuff.

Uh, none of that is a cakewalk. Uh, yeah, all of that is exceptionally hard. And so you're learning how to do like, we were learning how to do all that stuff as the company grew. And you know, I often think back on it where it was like those few decisions we got right. Like those were so right that they actually made up for the fact that like, we're learning as we go and kind of messing some of this stuff up as we go.

 You know, in some respects, you can look at this with, like, some of the other, like, world class companies, like, you think, like, a Google, you know, it's been said about Google, like, they stumbled into the world's best business model, everything else they did almost didn't matter, like, you know, like, best practices, not best practices, it's hard to tell, because they had this one thing that works so exceptionally well, uh, now, does that take away from, like, what Google made?

No, not at all. Like, getting to that thing was probably exceptionally hard work, and, you know, confluence of luck and skill and all these factors. But once you get this thing humming, a lot of these companies are pretty darn sticky, pretty darn durable. And then it's just figuring out how to do all the rest, and that stuff's hard.

Brett Berson: So if you were to bucket out sort of those hard things that you had to figure out, you know, you had one big bucket, which is general, maybe people management. And we'll say building an executive team, managing, letting people go, et cetera, et cetera. Like what are the other big buckets that was like hard earned to figure out?

Wade Foster: I mean, all the people stuff is probably the number one category. Everything pales in comparison to that. I mean, you know, there's certainly things like, how do you keep growing getting more customers? How do you retain and keep happy customers? How do you make sure your, you know, shipping features and the engineering and architecture of your site is really good?

Like all those things are hard problems. But I feel like those are a little more straightforward and known compared to like the people problems. 

Brett Berson: What do you make of that?

Wade Foster: I don't know. Like, I think um, all three of us are like more technical backgrounds. I'm of the three of us, I'm less. But you know, when you're writing code, like code works in a very, like it does what you tell it to do in a very specific way. Humans, we're not like that. Like we're more, we're just different. And so like, There's a lot more like psychology involved in that. Managing your own psyche, managing the team psyche, managing the team morale, uh, communication, keeping folks on the same page.

There's not like a one size fits all rubric for that stuff. You can't write like if/then statements and expect to always get the same outcome. 

Brett Berson: I mean, ironic given the, what your company actually does.

Wade Foster: I know, right, as much as we would maybe like that to be the way that it is, it's just not. And, uh, you know, I think that just makes it like, it's- it just makes it harder now.

It's fun. It's fun too like, you know, they're, you know, it's, it's, it's really awesome when you have the highs. Um, it really stinks when you have lows too. 

Brett Berson: What do you think you've kind of figured out about, we could say people management or hiring great people and setting them up for success? Like, what are the big ideas there? Or, you know, what's the little book that you wish you were handed 10 years ago and you opened it and it said X, Y, and Z.

Wade Foster: Oh boy. Uh, what are some ideas that like really touch out? A good business makes a lot of this stuff a lot easier. Like if you're making good money, if you're growing, if there's plenty of opportunity to go around, there's plenty of money to go around, salaries and bonuses and things like that, everything gets way easier.

So, you know, if you're having people issues, you might actually just have like business model issues. It's like you got to make your business better. And that might be more, a more impactful way to solve some of the people problems, not all, but some.

Yeah, I think, uh, there's a lot of just like good management advice out there is a great podcast manager tools, I remember that was one where like someone introduced me to that and it just taught me a whole bunch of like blocking and tackling management stuff. Uh, you know, how to do a one on one how to have a difficult conversation.

How do you know if you should fire someone or if they just need coaching? Okay, you actually do think you need to fire someone. How do you actually do that? You know, these are questions that like, yeah, after you've done them for a while, you're kind of like, oh, yeah, I guess I do know how to do it.

But when you've never done that stuff before, it can be a super scary thing to sort of figure out how to do. You know, I think great people solve a whole bunch of problems, probably obvious, like you want to have great people. But a lot of us tolerate folks who are not maybe amazing because we're worried about difficult conversations or worried about xyz.

I think a lot of self reflection is helpful. I gotta, I gotta coach along the way in this journey. It took me a long time. I got one in 2017, so six years and I got a CEO coach. And um, yeah I think if if you want to build a great team, like you got to be a great leader.

And, you know, I might have had some like, innate talent. But there was a lot of things I was missing to o as part of the picture. And if you want to get good at this stuff, like you have to work at it. And you have to do some self work. So like, what is great mean in the context of Zapier? Like, there's probably some shared ingredients with a lot of companies.

But there's probably some unique things. And those unique things might have to do with, like, what does it mean to have me on that team? Like, I have some strengths and weaknesses, and so what complements me versus not? And so figuring those things out, has been really important for me to, like, assemble a better executive team, to assemble a stronger team at Zapier on a whole.

Figuring out those principles and, like, really making sure that those are clear. So, I, I don't know, those would probably be some of the nuggets in there. I was going to write a book though. Yeah, I think I probably want to think about it a lot longer than that.

Brett Berson: Are there counterintuitive things that you've done in this area that have worked really well? 

Wade Foster: I think one thing we did that was counterintuitive to a lot of folks, but for us was the only thing we could do was we had this rule, don't hire till it hurts. And a lot of folks were saying, you're growing, you could grow faster if you hired more people, just put more people in. You know, I think a lot of companies and VCs pitched that too, over the last couple of years, which is like growth at all costs, like, um, hire hire hire! But sometimes there's like a, you know, more people, more problems issue. And the like, don't to- hire till it hurts rule of thumb really, I think helped us in a lot of ways. It kept us from getting out over our skis. One, it meant we did every single job. So we understood every piece of our business.

So when we hired somebody in, that meant we knew exactly how they were going to be effective, what was going to help them win. And it also helped us performance management. We knew what good looked like, we knew what bad looked like because we had done it and we knew at least there's a baseline.

You should at least be better than us at doing these jobs. And so that don't hire till it hurt, like it made us better. Like even if we weren't great managers yet, we still had a sense for what good and bad looked like in the role. Two it really helped us sort of grow the company in a way like a team size way that like was right size to our capabilities and our abilities.

You know, I think a lot of people have felt this pain over the last couple of years. They hired so many folks and their whole org grind to a halt because they don't know what they're doing with these people. Like, uh, you know, it's like they're supposed to magically come in and make the business grow.

But like, that's not really how these companies work. And so for us, because we had that more moderated like team size growth, it meant that we were ingesting people at a rate in which the organization could grow. Now just to give a sense of like how fast it was happening, though, like we were still bringing on folks quickly, you know, we went from, you know, first year was three founders.

Then after that, it went up to seven. After that, it was like 16. And then I think 35 and then 75. So like, you know, we're going like doubling people ish, you know, every single year. So it's not like we were, you know, dripping folks into the company. But like you hear these stories of companies that go from like 10 to 100 in a year.

And I think back yeah it's like, maybe now if you ask me to go do it again, maybe I could go 10 to 100. But certainly as a first time founder, like if I tried to go 10 to 100, I think we would have ruined a lot of stuff inside the business. And there was definitely a lot of people that were just like, why don't you- like Zapier is clearly successful.

You're doing great. Why don't you hire faster? Why don't you take this check like raise some money like go faster? You will go faster. And I don't think we would have actually gone faster. Had we gone that route. 

I don't have the counterfactual, so I don't know for sure, but 

Brett Berson: maybe you'd be a hundred billion dollar com-

Wade Foster: yeah, perhaps, like, perhaps I have actually really messed this up and all of all the things I'm telling you all right now, you should 100 percent ignore. But for me, like that for and for us, that was the path that made sense.

Brett Berson: How did you figure out this idea of don't hire till it hurts? Did it just click and it was obvious or you spent time discussing this tension point?

Wade Foster: Maybe it was another intuitive thing for us. You know, when we raised our first, we may raise the $1.3 million seed round. That's all we raised. And I think partly it was like, I don't like raising money. Being from the Midwest, we have this, like, skepticism of VC and like this worry about losing control of the business and like how these VCs will get in and just, you know, fire the CEO, fire us and like, you know, hand it over to somebody else.

And so, you know, we've got these fears on our head too. And I think partly it was like, well, we don't want that to happen either. So like, let's just, make sure that we're like really cost conscious about how we spend. We also have this constraint around our own abilities, like we need to learn how to do some of this stuff and the best way we felt like to learn was to, you know, we should try having one employee before we buy 10 employees.

There's a good John Wooden quote that's like, you know, Go fast, but don't go quick or something like that. I forget exactly how it is. There's like a little bit of that where it was like, we wanted to go fast, but not so fast that like the wheels came off the bus.

So just on that edge of where we, where we can handle.

Brett Berson: On this thread of growing the team, what was the order of operations? Even if you were sort of much more deliberate and careful as you grew the team. How did you decide what order to hire people in and are the things you got right and wrong over those first three or four years? 

Wade Foster: It was definitely more art than science. You know I think that because the three of us were so hands on and across the three of us, we had all the skill sets to do the jobs that the business needed in the early stage. Like, you know, we could build it, we could sell it, we could do all the things. We didn't have to go hire somebody to build like an MVP or anything like that.

That meant we could just see where the bottlenecks emerged in the business. So one of the first one that emerged was, customer support. You know, we were waking up and spending until 1, 2, 3 p. m. in the afternoon, just like on Olark calls, on emails, like talking to customers and trying to, you know, get those apps working.

And at a certain point, it was like, look, we can keep sort of like handholding these people along, or we can actually fix some of the underlying issues that are causing them to have to reach out to support in the first place. And so that felt like, well, why don't we go get somebody to help us with customer support?

And so we went and got someone there. And um, you know, that's going well. We've got that sort of under control, but we still feel like we're, you know, going too slow at, you know, fixing some of these underlying issues. And so it's like, okay, great. We probably need a little more engineering horsepower to get there.

So we hired, you know, a couple of engineers in and like, you know, that sort of create like a little bit of a steady state, things are working pretty good. And it's like, well, maybe we could get- grow a little faster. And so we hire someone on marketing to try and get like, you know, this content marketing engine up and running and see if we could get more top of funnel going and so it's just sort of like, where's the bottleneck in the business?

Where's the thing that's slowing us down? And, you know, do we have the skill set to like, go address that? And if not, let's go get somebody in. In terms of mistakes we've made, you know, I would say probably the, the toughest mistakes was around management. It was, you know, we were really slow to bring in anyone like that would have had a title of manager at sort of any level. You know, our first people who are managers were just like me, my founders, early employees that we promoted in, uh, promoted into those roles. And look like we were all first time at doing that stuff. You know, some of us were better than others, but I would say most of us were not great.

Uh, and in hindsight, like, we would have benefited from going out earlier as soon as we knew that, like, the team was going to grow to a certain spot to get, like, one or two, just like well rounded, like, managers into a few functions and say, hey, like, this is going to be, this is going to be a better way to grow the company.

Like, you know, I think the, the, the line I wish I would have said is like, go on and talk to folks and be like, Hey, I don't know how to do this function. You don't know how to do this function. The best thing for Zapier is we go get someone who knows how to do this function. Because both of us not knowing how to do it and learning isn't great.

Like we should get someone we could both learn from. And that would have been a way better thing for us to have done earlier on. I think it took us till, we probably had 30 or 40 people before we hired someone who had been a manager before into the company. Which in hindsight was just like far too long.

And same, same could be said about hiring executives too. Like it just took us too long to bring an executive into the company as well. Someone who sort of had an even more like, you know, amount of leadership in those areas. That, that's probably the, the, the number one, like mistake that comes to mind.

I'm sure there's many, many more, uh, that, uh, if I pulled back the history books, we could, we could review all of my mistakes one by one.

Brett Berson: that would be a nice follow up episode.

Wade Foster: If I could, If I could make it through it without crying.

Brett Berson: Um, so on the hiring sort of folks with management experience, maybe building the executive bench earlier on. What's the why behind the decision not to do that?

Wade Foster: You know, I think it comes back to that, like, don't hire till it hurts philosophy. And I don't know that we felt the pain of not having those roles. And I don't know that we clearly understood the upside of what great looked like there. And so that was one area where I think that philosophy maybe hurt us a little bit.

And we probably had some baggage from old gigs where, you know, head managers maybe weren't great managers and maybe drew the wrong conclusions from that, which is like, hey, I don't think managers are all that useful, which would have been the wrong conclusion to have drawn. And so I think we were just like slower to establishing that and seeing the value and what really good could look like in those areas. And I think it was somewhat hidden from us because mostly the business was working and like team was generally pretty happy. Things weren't breaking down. And so it's like, well, what, like, why do we need this? And that probably made us a little slow to act in this area.

Brett Berson: So, knowing what, you know, now, like, what would be your heuristic for when to bring in managers and then when to bring in and kind of start to formalize an exec team?

Wade Foster: I think if you like, there has never been a situation where I've regretted hiring somebody. More like more senior, but there's some there's like a asterisk to that, which is that there are definitely people who you can hire who are quote unquote too senior because they won't roll their sleeves up and do the job.

But if you can find somebody who has all the executive skill sets, who is willing to join your company and able to roll their sleeves up and do the job that is a game changing hiring our first CFO was incredible for this exact reason where there was no job that was too big for her, but more importantly, there was no job that was too little for her. At an early stage company that is so killer because you have so many jobs that are so tiny.

You know, I remember being a little embarrassed actually the first week when I was like, hey, you know, we got to plan this retreat and I need to go book a bunch of plane flights. It's like asking a CFO to go book a bunch of plane flights and she was like, yeah, I got it. No biggie. And it was just like, ah, that's exactly what you want in this role.

While at the same time, she could think through all of our finances and, you know, present to the board and like do all the stuff that you sort of want and need out of a CFO too. And that's like the magic. It's like, if you can find someone like that, who's willing to work for you and you can afford to get them in the org, like run to that as fast as you can.

The challenge of course, is that you know, a lot of folks get to a certain level of seniority and they're not willing to actually put in the work anymore. You know, if you really press them, they'll be like, I could get the job done, but I need to hire a team of five or I need to hire a team of 20 or whatever.

And, you know, those early stages, you're like, well, sorry, you got, you know, $50,000. I heard a story once that like, uh, Tony from DoorDash does, uh, when he hires executives he gives them 10 bucks and says, Hey, you got to go get me you know, a thousand customers as a way to sort of test in screen for this, like their scrappiness um, to figure it out.

You don't have to do that, but it's like, you got to figure out, are these people willing to still like do the work. 

Brett Berson: Yeah, I'm curious, do you have a version of that? 

Wade Foster: There's no like one size fits all way to get at this. But I think you got to sort of be creative and sort of how you, how you suss it out. A few things that can work. But every situation might be different. It's like, can you get them to, you know, do some stuff on the job for you in advance?

You know that CFO I talked to you about, she was between gigs and so she consulted with us for a month. So I got to see her like actually do her work. That gave me a lot of confidence that it could work. You know, you could, do a bunch of like classic behavioral interviewing style questions.

Tell me about a time when? And then really probe and see like, how much is this person doing on their own? How much are they leaning on the team? Follow up with reference calls, talk to all those people who are in those same situations and verify like, you know, how, you know, what did this person do? What did their team do?

Was there a team? Were they by themselves? To get a really good sense of like, are they willing to do that? Uh, what do they do outside of work? You know, do they have side projects, hobbies, you know, are, are those look a lot different? You know, if they're running a non profit in addition to being a big company, well, non profit operates very differently.

There's a lot different resource constraints compared to this. And so you just get a sense of like, you know, however you can get to it, you know, get, get to it. Um, and see if this person has the ability to roll up their sleeves a little bit in a way that, you know, again, doesn't come with, you know, a 20 person headcount plan, which is just not a great fit for, for, for a early stage company.

Brett Berson: One of the things that I've noticed when companies start to hire people with some experience or certainly a lot of experience, is that one of the challenges is that a lot of people want to implement the things that they figured out kind of one for one at the new company. There's kind of this delicate, delicate tension, I think, where you want someone, one of the reasons you're hiring them is that they are not quote learning on the job, but at the same time, you know, the Zapier machine is different than the Salesforce machine is different than the Atlassian machine. And if you start taking, just grabbing gears out of the Salesforce machine and jamming it into the Zapier machine. Generally speaking, bad things will happen. And I'd be curious, does that, do you think about the world in that way? And is there anything that you've sort of figured out? Because I think relative to other companies, it feels like the Zapier machine is a very specific machine with gears that are put in place for a very specific reason. And there's a lot of ways that you can start to break the machine by just trying to jam other gears into it.

Wade Foster: Yeah, I definitely think about that when we're hiring for roles. You know, sometimes you can look at those playbooks, you know, from your seat and say like, oh, it's close enough. Like, I actually want, I want that playbook or a version of it, right? Maybe not the one for one thing, but like, very, very close match to it.

And maybe you're willing to accept a little risk where it's like, Hey, I, I, I'm, I'm pretty confident this is going to work and let's go get an exec that knows how to run this playbook. And we're not going to worry so much about, can they like learn and adapt and figure it out? Cause like our confidence level is high enough and you know, we're just going to go bring that in.

And and that can work like we've had folks that have come in that have done some versions of that, but the challenge with it is like as things scale they may not scale the same way and, you know, you start to bump into like, you know, has this person just had they mastered one particular thing? But then has like no awareness of like stuff around them, it's gonna make it tough for them to scale.

It's way more fun and way more valuable to work with folks who have a much more dynamic problem solving skill set, where they can borrow from a bunch of different areas, and then they can start to put those puzzle pieces together in novel ways. You know, so they certainly are pulling from maybe different playbooks, but it's then the way they get assembled starts to be unique and starts to match a little bit more what you're doing.

And that's where it's like, it is valuable to listen to, you know, something like, you know, the in depth podcasts. You get to hear all these stories of how other companies did something and you can go, okay, there's a piece in there of the Zapier story that actually does apply, but I'm going to have to put this spin on it that matches this other thing that I was, you know, working on this other job.

Like, you know, I was a, who knows, I was a teacher in another life, and this is the way that it works in teaching, and so like, I can take this, and I can take this, and now I can assemble it and create something that to everybody else will look quite new. It might feel totally weird, but to you it feels... totally, intuitively natural. People like that are super valuable. And this is where I, I like, I have a little bit of a bias or preference for, for folks that do have more eclectic interests, who can stretch across different, you know, industries or different interests um, because they're, they're just pulling from problems in different skill sets and putting them together in ways that um, allow you to create something somewhat unexpected versus someone who's just like, Hey, I've, you know, I've done this one thing and I've mastered this one thing.

And, you know, I'm really good at it. It's not that that person can't be valuable either in fact they're probably exceptionally valuable if you to also have that particular one problem. But in these early stage companies, there's so much learning there's so much dynamism to it that you do want a little more of that ability to sort of cross lanes.

Brett Berson: What's kind of a good example of that over the past year or two or three, where kind of you have taken inspiration from the way maybe other machines operate and figured out how it translates into the world of Zapier?

Wade Foster: Well, um, I mean, it's not a solved problem for us yet, but, you know, we're hearing from our customers that, you know, we're getting pulled up market, you know, we're getting pulled into these discussions from folks that are in bigger organizations or candidly, they started small with us, but now they've grown and they have new problems, new traits.

And so when we started to think they're like, well, what do we want from a sales motion? It's like, Hey, you know, or what do we want out of a sales leader? You know, a lot of that is trying to figure out like, okay, you know, the way in which Salesforce sells is clearly not the way in which Zapier sells.

So I can go get a VP of sales or whatever at, at a Salesforce. But if they just come in and start plopping, you know, their playbook in, you know, it's a different customer. It's a different price point. It's a different product. None of that's gonna work. And so, you know, a lot of it has been, you know, going out and looking at companies that maybe have similar customer types, similar price points, similar customer journeys, and just talking to the people that did this sort of like zero to one sales motion there and saying like what works, what didn't work, what hard problems did you face and then trying to go like, does that match us? Or ha- we don't have that problem. Like you all have this different variable that like maybe made that work.

And you don't always know is the thing. Like, you know, that's, that's the tough thing with these companies. We don't get, they're not science experiments. Like, you know, we can't A/B test them. They're not, we don't have these counterfactuals where it's like, Oh, if you had just run this entirely different playbook would have been better or worse.

You don't necessarily know. And so a lot of it is a game of you're trying to formulate in your head, like, is this the path? Like, does this make the most sense and be really honest with yourself? And so, like, that's one example of, like, how do we think about that? That that motion for us as we go, go, like, sort of expand up market.

Like, it's a little bit of pattern matching, but a little bit of invention for what we're trying to do too.

Brett Berson: Shifting gears slightly, we started the conversation off by talking about what the product looked like in the really early days. And I'd be interested in hearing, like, what is the 12 year evolution of the product? Or, like, could you articulate the different chapters and how you sort of figured that out?

Wade Foster: There's probably like a handful of major differences that have happened over the years. And then a bajillion small things that have improved that I probably, I couldn't even recollect them all. The first thing that stands out is the original version of Zapier: single trigger, single action. When something happens in this app, do this in this other app.

That was all it was. And so Zapier was very much thought of as an integration platform. And it had a relatively small number of apps on the platform. I think it started with two, right? Uh, and of course, like a through line from all of this is just the explosion of number apps that are supported on the platform from two to now 6, 000 today.

And so that's just been a steady progression. And one that has compounded and compounded and compounded over 12 years. But we start with that single one, probably the first big inflection point in the product is going from a single action to now multiple actions. And so you go from this integration platform, connect these two tools, to now an automation platform. So that's a big piece of it. Oh, actually one thing happened before that, which is on the developer side of the business. So the developer platform was in between this, which allowed other people to start building apps on Zapier. So that allowed that, you know, two to 6, 000 to go.

Brett Berson: Wait, so that was specifically other people could create integrations that then other people could use, not people creating their own recipes that then they could send to other people?

Wade Foster: Exactly. It's the other side of the, you know, if you think of Zapier as a two sided marketplace, one that's like building apps and the other is building zaps, it's like this allowed people to put apps on Zapier and when 

did that happen?

That happened in 2012. Um, So pretty early, so then we've got multi steps, then we've got a bunch of collaboration stuff.

Brett Berson: So just so I understand the difference between the concept of we started with integrations, and then we moved to automations, is it just allowed you to do things sequentially instead of one for one?

Wade Foster: Yeah, exactly. And you could, you could create a total end to end workflow. So it really opened up the capabilities of the platform in a much, much more creative way, I guess. So you get that, then you start to get all these team and collaboration features. So that's probably a big one.

The latest one is, uh, a visual editor. So instead of having to go in this very linear fashion, you can start to make paths and you can see that very visually in, uh, our editor. And then now, there's an expansion into other products. So we've got a tables product and an interfaces product. They're all in beta, uh, and an, uh, an AI chat bot, bot builder that's on top of that.

And so that's the, that's starting to help you build your automations, uh, end to end on Zapier at least with some core primitives, then augmented by the 6000 sort of apps ecosystem. And a lot of this gets built like it's informed by a couple things. It's, a lot of it's informed by what customers need and the problems that they're facing.

And then, you know, good chunk of it is informed by customers that you don't have that you think you should have and some intuition about where you think the product should go. And that helps you get from, you know, this tiny seed of an idea to then, like, expand, expand, expand sort of over time.

Brett Berson: So on that point, if I were to go back and watch you and the team, make these product decisions, what did it look like in a little bit more fidelity? I mean, I would assume at any given point in time, particularly because you had a lot of market pull, you could always go X or build Y. You could do this or you could do that.

Wade Foster: I mean, and that's like for most of Zapier's history, you know, it's a relatively small ish team. And so a lot of it is you know, a maniacal focus, focus on like the singular thing. So, you know, we, we decide to go build multi stepped apps. It's Hey, this is the thing. This is the most important thing we can go do.

And so the product teams are laser focused on that thing and you know, yeah, there's some smaller stuff getting like shipped along the way to polish up the product in other ways, but that's it. And then you get to the finish line on that. And there's a little bit of you ship it, then there's polish work that you're sort of making sure like, you know, you're cleaning up sort of stuff that maybe you missed or, or didn't serve like you didn't hear that feedback with your beta customers on.

But then afterward, you're sort of coming back to the table and then you're like, okay, what's our next thing? What is the next big chunky bit that we want to go tackle and get after? And then all the while, you're still filling it in with tons of like, you know, smaller, quality of life, feature, polish, you know, business model testing types of ideas along the way.

But generally, we were always trying to think through like, what is the one thing that, like, really matters for, for when you want to go next? And it's really only been, you know, more recently when we've been able to go from one to, like, two or maybe three things at once.

Brett Berson: On that sort of point about the one thing that matters. Was that mainly intuition based? You talked about this a little bit a second ago, but what's the process to have that level of conviction that we're going to kind of go spend the next chapter on whatever the thing was? Let's say multi step Zaps.

Wade Foster: I think it's generally fed through customers in some way or some form. You're paying attention to what is happening. You're talking to them, you're watching the data, uh, and you're trying to get a sense of, like, what are the biggest problems that exist? You know, customers are generally right about the problems that they're having.

They can, they can tell you like, this stinks. Now, I think where you got to be really skeptical is the solutions that they go tell you to build. Sometimes they might have a good idea, but a lot of times it's not exactly the best way to go and tackle it. But you really want to pay attention to that problem list because they're, they have that problem that exists.

And so you're looking at that and going like, ah, I think if we solve this there is a big chunk of customers waiting, and that big chunk could be in your existing customer base. So you're like, Hey, all of our existing customers are going to get happier. Or it could be, Hey, there's some outlier customers that we think actually represents a new set of customers we want to go get, a bigger opportunity. And if we solve it in this place, it opens up what our company could become. And, you know, you debate that you're like, what's the most important place to go? What's the most important one to go? And ultimately, you know, you make a call based on some conviction there. The data informs it, but it's not, you know, the data doesn't give you the answer.

You still have a human making a call where you think this is the thing I got to go get after. So that's, that's generally how it works for us.

Brett Berson: In each one of these phases in the company's life, did you think about or consider the competitive dynamic in the market?

Wade Foster: Not as much. You know, we, we often were just very laser focused on customers and what they were telling us and the problems that they have. If alternatives were showing up with our customers and they were telling us about those that's when we'd start to pay attention like, okay, what- tell us more about that.

Why do you like that? What's solving that problem for you? Help us understand that. But rarely were we going out and saying this product over here that looks like us, but we've never heard a customer tell us that that is a thing. Should we go start chasing and following the stuff they're doing? Now, that doesn't mean we're totally ignoring it or paying attention to it.

There's definitely been times where I've seen a new product and just like playing with it and experiencing it and going like, Oh, that's a novel UX feature. Or like, that's an interesting way in which they did that. That has some parallels to what we're doing. So we certainly get inspired by like the products we use.

And sometimes those are, could in theory be alternatives. You know, but I think it's a, I think you get into this really tricky thing where you're just literally like paying attention to somebody else's roadmap and just being like, Hey, we just got to keep up. You know, we just got to match it 1 to 1 because oftentimes you don't actually know why is it that they were building that thing?

Like what was going on? And if they have a different set of customers or the customer base doesn't match your own in some way, it's going to lead you astray. And so for us, we always felt like our own customer base was the best shining light for where we could go and or what I like to call the marginal customer.

It's like the customer that could have picked you, but maybe didn't for whatever reason. So you wanted to pay attention to that top of the funnel. It's like where people dropping off where people that we felt should become our customers, but they're not. Like we wanted to really pay attention to that.

And that has always been you know, got 95 plus percent of our attention.

Brett Berson: Maybe you disagree with me here, but I think one of the things that's been interesting about Zapier is obviously there's a lot of products that have been inspired by what you did. But in general, it feels like you've been able to really dominate the category. Certainly for your core customer that feels very different than so many other categories over the last five or seven or eight years, where you have had 10 other SaaS companies emerge and end up sort of like clobbering each other in some sort of way.

I actually think that's one of the biggest headwinds in building B2B software is there's lots of people doing very similar things, which ultimately degrades each other's businesses. Is it ultimately the interplay between product and distribution that you think has been the setup that's been so powerful and so hard for people to replicate?

Or is there something else that's kind of given you the power in the market?

Wade Foster: I definitely think that that is a big aspect of it where, you know, being able to build a big integration platform has made it tough to, you know, sort of go toe to toe with us, uh, at least. Sort of in a head to head way, I guess. You know, we have had competition and you know, even today, we have probably more formidable competition than we've maybe even ever had.

But I do think it's different, to, to your point. Like, you know, we're not yet another CRM having to like, you know, duke it out for this particular niche and slice of the market and make really opinionated choices on like, which customer type are we gonna serve and like, you know, we want to be differentiated enough in this way.

I think a big part of that is if you've got a really strong distribution and some network effects, which we do, it just makes it tougher for, you know, the next person to you know, find their, find their niche. It doesn't mean you can't. In fact, we, like I said, we have formidable competitors. And that is actually healthy for us too, to have some formidable competitors in that way. But yeah, it for a while was, it, it was a little more open road for us, I suppose.

Brett Berson: One of the things that I've, I've noticed sort of longitudinally in companies is there's sort of this delicate dynamic of doubling down on the things that are working. And constantly updating your priors based on sort of where you are in the company's journey. So few companies ever get to really strong product market fit. And for those that do, I think most founder-CEOs tend to be really hardened in like their points of view on anything in the company. And so like a really kind of simple example would be, you know, you have a company and they get to product market fit and they have no managers, like everyone's reporting to the CEO, for example. And that CEO, it becomes very hard for them to move to a more traditional org design, even if it's the best thing for the company, because they tell themselves we did the hardest thing possible, which is actually get to really strong product market fit. We did it because we had no managers. We should not have managers. Another example would be, there's a lot of companies that believe in no product managers and then eventually hire product managers.

 And it's sort of, it's this idea of what, what got us here might not get us there. What have you figured out as it relates to this, or does any of that kind of resonate with your own journey building Zapier?

Wade Foster: I mean, the what got us here won't get us there is, is definitely, definitely resonates. Um, Annie Duke who wrote that book thinking on bets, like has this really good framework in it and I'm going to butcher exactly how it is, but the, the, the thing I drew from it is that you can make a decision that is a good decision and you can get a good outcome or a bad outcome from that good decision.

Or you can make a bad decision and get a good outcome or a bad outcome from that bad decision. And most people don't naturally think of it this way. They think of it, I had a good decision means I get a good outcome or I have a bad decision that means I got a bad outcome. I would take it even further, which is that you can have a good decision and it can come with a variety of outcomes.

You can have some good outcomes that come from that and some bad outcomes come from that. It's a spectrum. Like you don't get a singular outcome, you get a mixed bag of stuff. And for that reason, like it's so important to like to just keep yourself honest about like, you know, if you're winning, are you winning because you made a good call, or are you winning in spite of yourself? You know, are you, if you're losing, like, are you losing, but you're like, you just need to keep at it? Like, you're doing the right stuff, you just got, you haven't gotten there yet? Or are you losing because, like, you're making bad choices?

And, yeah, I think, as you go along, if your opinions get so hardened on the wrong conclusions, that's gonna weaken what the ultimate outcome of your company can become, but if you remain flexible and even in the places where you really do think you got it right, like, you know, I'm, I'm pretty sure it's this, you need to keep some space open, like it may even just be like 1%, like just some space to come back and say, like, yeah, I'm, I might be wrong.

And give yourself the chance to, like, have your priors, like, proven incorrect. Because the world just, like, okay, maybe, maybe you got it right in that world, but we don't, we don't exist in a static world. Like, the world also shifts around us, too. And so, you know, yeah, maybe the decision I made back then was, like, 100 percent the right way to make the, run the company in 2011 or 2012, but we're in 2023 now, and there could be a whole host of different factors that, like, if I don't adjust to that, like, you know, the world doesn't really care about that. Like, it can, like, it can outlast me and sort of my stubbornness. Uh, and so I think for that reason it's like really important to just keep it, keep an open mind and be honest about that stuff. 

Brett Berson: How do you do that? You know, most people don't get up and say, you know, I want to be intellectually dishonest today. And so how do you, I guess I'm super interested in how you action it for yourself. But in addition, are the ways you kind of inculcate it or mechanize it inside of the company?

Wade Foster: I mean, you want people around you to push you in your thinking, to challenge you in your thinking. You know, the more the org becomes groupthink, like the harder this is going to get and like, there's a fair body of evidence to say, like, the more you're even aware of these phenomenons, like the more you in the smarter you are, like the more actually dangerous you are to these things, because you actually get better at rationalizing your way through it.

You're like, oh, I've actually thought it through. I actually am being intellectually honest. And like the more you do that, the more likely are to make these mistakes, which when you start to think about that, you're like, Oh, crap, like I'm screwed. Uh, and so, uh, having like, you know, this is where I got a couple of co founders, you know, could be executive team, it could be customers.

You just got to find some way to like constantly like push back against. You know, those that settled things and you can't do this all the time. Like that's the other half of it. You're running a company, you've got, you know, a whole bunch of different fronts that you're sort of dealing with, but on the ones that are really important, like you do have to be able to have this, like, honesty about yourself. You have to, like, treat it a little bit more like a science experiment than a, than a sort of settled thing. And then, like, you got to balance that with having conviction, too, at the end of the day. Because, you know, if you're constantly second guessing yourself, if you're constantly questioning this, like your company's getting confused then, they're like, well, is it this or is it that? So then you got to balance it with having conviction um, which I mean, I don't know that I can give you a pithy quote on this podcast that's going to be like, ah, if you just do this, like you will, you'll be able to be both intellectually honest and have conviction and all your problems will be solved.

Like, all I know is to just say, like, wrestle with it. Like, that's the best I can come up with.

Brett Berson: So maybe to wrap up, we could sort of end on a question that I always like to sort of bring things to a close, which is who are the folks or the person that's kind of had the biggest outsized impact on the way that you've built your company? And, are there specific things they, they taught you that we didn't cover that have really been a big part of like your worldview or set of philosophies.

Wade Foster: Well, I mean, my co founders would be like the easy answer like Bryan and Mike you know, we've just done this whole thing together for 12 years and like constantly been, you know, partners pushing it back and forth together. You know, I think if you go sort of before that you know, a lot of it comes from like, you know, my granddad, uh, my granddad was, you know, an educator for a long time, was a counselor for a long time.

 He was like the proverbial coach in the family, like where, you know, he would, he'd have a way of like, subtly encouraging you to go explore a topic or like needling you to look at the other side of a point of view. And, you know, just get you thinking about a topic and a more open minded way, I guess, at the end of the day, without without like, you know, telling you you're wrong or like being mean spirited about it. It was just like, it was an open exploration, uh, you know, sort of anytime we got to go talk about anything and, you know, a lot of times I would go camping with him in the summers and stuff like that. And so this would be happening, you know, or fishing or like over campfire or anything like that.

And so, um, you know, you do that after a year and it's like you can't help but be a product of, of being around people like that to growing up. So, you know, I think, you know, that, that a big part of it probably predates even, even that and it comes down to my granddad and just, you know, all the family I like spent so much time growing up with.

Brett Berson: Great place to end. 

Wade Foster: Thanks for having me, Brett.