00:02:07 · Siddhartha Ahluwalia, Varun Badhwar
[00:02:07] S1: So so one of the qualities that I have seen some of the best founders is in their earlier years they moved a lot. Do you think that contributed to to your shaping up? [00:02:20] S0: I don't know how much that did. You know, my parents will tell you I was born a businessman. I was from the time I remember, I was trading bicycles, buying, selling. I was, you know, during my summer breaks, I would be doing projects. And every time uh my parents were very social, every time their friends would come, I would have something out built, uh heart handicraft, arts and crafts that I would be selling. Um so I guess I was just always gravitated towards entrepreneurship, if you may want to call it that, uh, starting very early days. You know, is that something you're born with? Is that a gift uh that you come to this earth with, or is it something you learned? I think it's much more of a natural instinct because you know, even much later in life, there was a question of do I go start my first company in 2010, CypherCloud, or I was very close to going to business school uh for an MBA at Kellogg in Northwestern. And again, I kind of chose the entrepreneurial route. It was just the natural pull for me. [00:03:19] S1: And and can you describe your first two entrepreneurial journeys before we come to Endor?
00:03:25 · Varun Badhwar
[00:03:25] S0: Sure. So 2010, as I was just mentioning, I was in this crossroads. I was I had a great run at Salesforce.com. I was four years in. I had joined them when there were 1,500 employees. I had seen it scale up to six, seven thousand employees, but I was bored. I would come in at nine, I'd leave by six o'clock, uh, working on great groundbreaking stuff around cloud security. But I wanted to do something different. And uh it so happened that I uh met and reconnected with somebody I'd known for a long time who had a design who was a multi-time entrepreneur and founder, and he had a desire to start a cloud security company. Well, I had the domain expertise. And so we got together and in late 2010 started this company to secure uh cloud-based applications. The idea was as people start moving from enterprise app, remember this time, it was a crazy idea to think you would put your customer data in a SaaS application in the United States. Um, so how do we work around that? How do we get people comfortable with data security and privacy and regulation? Is what we built the first company around, a company called CypherCloud. Uh, and that's what we did. And I did that for about five years, had a great run, learned a lot of things about how to build and scale, but also learned a lot about the mistakes we make. And thankfully, I was not in the CEO seat where the pressure and stakes are so much higher. But I got to be kind of the right hand to the CEO and really learn. And then in 2015, I uh felt confident and comfortable and found the opportunity to build something in the cloud infrastructure security space because now the talk of everybody's kind of conversations at dinner and coffees was why are we building data centers anymore? There's AWS, there's Azure, GCP. And so Redlock is the company I founded in 2015 that was focused on securing all of your applications as you entirely shift from a perimeter you control in your four walls of a data center to compute your rent from third-party hyperscalers.
00:05:30 · Varun Badhwar, Siddhartha Ahluwalia
And so the commonality in CypherCloud and uh later Redlock, and as we talk about Endor, I'm sure we'll get to that, but was always these big technology shifts and its implication to cyber and cybersecurity and safety, um, and really creating new markets for problems most people couldn't even comprehend, and how we had to educate the market, create budgets, and eventually create category-defining companies. [00:05:56] S1: So, how was the journey, you know, when you became ultimately the CEO at Red Lock, raising money, getting the first few customers? Because before that, you were mostly on the product and engineering side.
00:06:09 · Varun Badhwar
[00:06:09] S0: Look, I've I've always been obsessed with customers, customer needs, customer use cases. And I've generally been um I've had enough uh to be dangerous knowledge on product and technical side as well as on the business and sales side. And so I think for me it was a natural thing to become CEO. But I'll tell you like nothing gets nothing prepares you for it. It's a lonely job. First thing I tell people is the buck stops with you, right? The consequences of decisions you make for days, weeks, months, and years are based on what you chose. As a founder, there's no book you you know you have read and you follow the track on. The reason we're creating something is because you're trying to do something that hasn't been done before, or you're solving a problem that hasn't been solved before. So it's not like I can follow somebody's playbook and do it. And I think it's a lot of part art, part science. So intuition matters a lot. Instincts matter a lot. To this date, I usually say that, you know, when I'm interviewing candidates as an example, usually I feel like in the first five minutes, I have a high degree of confidence if this person is gonna be the right fit for us or not. This next 55 minutes or longer that I spend in the conversation is really getting to the details. So instinct development matters a lot. And I feel like I had developed that over my first two startups. Uh, I'd also learned about just how important it is not to take shortcuts. I think usually people will think about, well, I just got to get this out. Let me just create something. But if you think about Redlock, you know, in three years, we went from uh first idea to an exit, a very large successful exit. But three years and one day later, we were thinking about how to service 65,000 Palo Alto networks customers post-acquisition. And we took that business from five, 10 million ARR to 100 million error. And I'm talking about doing this in 2018, 2019. We couldn't have done it if we had all these shortcuts on our platform and everything was held by Band-Aid and Duct tape. So, yeah, I think some foundational aspects of build for scale from day one. Yes, you got to be scrappy, but you've got to really look around the corners. Intuition and gut matters as much as science and what you've learned in school matters, were probably the big things I've taken away.
00:08:29 · Varun Badhwar, Siddhartha Ahluwalia
And the importance of investing in the right team upfront. I think we made the mistake early on in the first couple of companies where it was like, well, we don't have a lot of funding. Let's figure out how do we cut corners. And I just realized eventually, even like your equity, right? As a founder, you don't want to give up too much equity. Um, but you can only build a successful company if you share the wealth and you find the best talent and kind of unconstrain yourself to do that. [00:08:58] S1: So, so let's compare your journey now in Redlock, right? How much did you raise in the first few rounds and how big did your team get before you got acquired?
00:08:58 · Siddhartha Ahluwalia, Varun Badhwar
[00:08:58] S1: So, so let's compare your journey now in Redlock, right? How much did you raise in the first few rounds and how big did your team get before you got acquired? [00:09:07] S0: So with Redlock, we had raised a 2.5 million seed and about an $8 million Series A. So we were very capital efficient as a company. We'd raised under $12 million in funding. The company was about 85 people, split half and half between India, uh, Bangalore, and US. And um, you know, we were closing in on the first 10 million of ARR, a short amount of time actually, from inception to that point. And the exit was uh, you know, close to $250 million exit for the company, which was an incredible return for all our investors. It was life-changing for every employee because, again, I believe in investing in people, you know, a lot of times people say, well, in India, when you're hiring employees, they care more about cash, less about equity. And I would always educate people like, look, salaries pay the bills, but life-changing moments come from equity. And I think it's really interesting, even when I look back now, many years from now, I'll get a text message from somebody saying, Look, I bought the second vacation house. This is all thanks to you know the redlock run I had, or you know, I've got this nice new car, couldn't have it done without redlock. So I think it's very fulfilling knowing that it was not just a wealth creation event for investors and founders, but for every individual that worked in this company.