Invest Like the Best with Patrick O'Shaughnessy
· Patrick O'Shaughnessy
[00:00:00] S0: My guest today is Jesse Zhang. Jesse is the co-founder and CEO of Decagon, one of the fastest growing AI customer service companies. Decagon provides a centralized AI engine to auto resolve issues at any time, in every language and across every channel. Jesse shares his systematic approach to finding product market fit by asking potential customers exactly how much they'd pay for solutions. We explore why customer service and coding have emerged as two of the clearest AI use cases for enterprise and the key business and technical factors behind Decagon's momentum. We also discussed the intense competitive dynamics of building an AI today, strategic decisions around building proprietary models and deploying AI agents at enterprise scale. Please enjoy this great conversation with Jesse Zhang. Perhaps an interesting place to begin - I bet you don't expect this - is for you to tell us a little bit about the phrase that you've talked about that's written on your wall in the office.
· Jesse Zhang
[00:00:00] S1: Yeah, for sure. So on our wall in the SF office and we just did it in the New York office as well, we have this quote. It basically goes along the lines of there's no challenge that can't be overcome and there's no enemy that can't be defeated and we just like it. I think it really fits our culture. People there, we have a very competitive team, everyone wants to win. We have a lot of energy when we're trying to go out and build because it just feels like there's all this stuff happening in the industry. We have such a strong team, let's just go and win. Motivated by my dad told me this - I don't know if this is actually validated or not - at Huawei in China, it's obviously a massive company, but they're known for just having like killer culture. And they have some version of this written in Chinese, of course, in just big red letters across the back of the big hall. So yeah, really like that. It's kind of interesting, any time that someone walks in, the quote stands out.
· Patrick O'Shaughnessy
[00:00:00] S0: I asked about it to begin because I'd love to spend some time on just what this environment is like, building a company like yours against formidable competitors in probably the most exciting era of technology that any of us will ever live through. And words like this - "defeated" - I've heard the word "violence" recently about a company culture. Aggression - these are not words that were being used three years ago or four years ago. In fact, if you used them, it was a big problem for you. And obviously that has completely shifted. And not only have founders started using these words, I think talent and senior people are rallied around them. They want to be in a culture that is defeating enemies or violent or aggressive. Maybe just riff for a while on what it's like to be building and competing in one of the big areas - in your case, conversational AI, et cetera - at this moment in time, because it's just so different than it was a couple years ago.
· Jesse Zhang
[00:00:00] S1: Our whole view is that any space that's worth going after, any large hot market, it's going to be competitive. This is not really specific to AI, right. If you think about Databricks versus Snowflake or Ramp versus Brex, anytime there's these big massive growth opportunities, people are rational, they want to go after it. So I think in this generation, it's just, I think it almost attracts a specific demographic of founder and people that want to build because it is exciting. But of course, everyone knows it is competitive because if there is market, then everyone's trying to build it. It's quite easy to start a company these days. You can raise funding really easily. And so when you go out there, you have to, at a certain point, have a pretty deep understanding of what your competitive advantages are. And one of those could be the culture. And if you build a good culture that's pretty hard to replicate, it also lasts quite a long time. And to your point, if you have a culture where everyone is really geared towards succeeding and working hard and having some level of intensity, it can go a long way. So I think to your point of a lot of companies adopting similar mindsets, I do think from my observation, this generation of company building has attracted almost a demographic of person, where it's just people that grew up in fairly competitive environments, academics or whatever. And a lot of these founders have done well, did a lot of math contests and coding contests growing up. A lot of the people around my age are doing startups now and people are doing quite well. And I think there is some element of if you really embrace this hardcore lifestyle or environment growing up, then yeah, I think it lends itself pretty well to the current situation because there's a lot of parallels.
· Patrick O'Shaughnessy
[00:00:00] S0: I was with Scott Wu from Cognition recently, who is well known to be one of these math champions. You as well talk about that environment. What was that competitive world like? What was it kind of - let people into that world because obviously it shaped you a lot.
· Jesse Zhang
[00:00:00] S1: It's kind of an interesting experience, I would say. I think when you look back now that we're all grown up, it is kind of a pretty intense way to grow up. But I look back on my childhood with very fond memories. You get a really nice community, a lot of people that are doing the same thing. I grew up in Colorado, in Boulder. Boulder's a pretty academic town, but there's not very many people that are super gunning for these contests. A lot of my friends just kind of grew up in not the places you would think - California, Texas, New York. And so it gives you some level of community of okay, yeah, there's a lot of other people out there that are doing the same things as you and you meet a lot of them and then now that we're all grown up, those relationships have lasted for a long time. But yeah, the environment is one where it's similar to company building, how well you're doing is fairly objective. There's a lot that has to go into it. There's a lot of preparation, a lot of having the feeling of it is a long term thing. But because your results are fairly objective, there's constant motivation to improve. I think that's quite nice. One of my big theses is that this audience of people or this sort of community of people, there's a lot of untapped potential there. And to actually turning them into people that do business or companies and things like that, a lot of them have historically gone into trading or academia. I mean those are perfectly awesome jobs. A lot of the folks here, this background is correlated to one where it's a little bit more risk averse and kind of just get your good grades and follow a track. And if you can kind of divert some of that talent into company building, I think there's just a lot that can be done.