Invest Like the Best with Patrick O'Shaughnessy
00:00:00 · Patrick O'Shaughnessy
[00:00:00] S0: Ramp is the only platform built to make your finance team leaner, faster, and better, saving businesses 5% annually on average so you can stay focused on growth. Ramp just opened for business in The United Kingdom. So if you're running a business in The UK, you can now use Ramp's AI powered finance platform to manage cards, expenses, bills, approvals, and accounting all in one place. I run my business on Ramp and so should you. Learn more at ramp.com/invest. OpenAI, Cursor, Anthropic, Perplexity, and Vercel all have something in common. They all use WorkOS. And here's why. To achieve enterprise adoption at scale, you have to deliver on core capabilities like SSO, SCIM, RBAC, and audit logs. That's where WorkOS comes in. Instead of spending months building these mission critical capabilities yourself, you can just use WorkOS APIs to gain all of them on day zero. That's why so many of the top AI teams you hear about already run on WorkOS. WorkOS is the fastest way to become enterprise ready and stay focused on what matters most: your product. Visit workos.com to get started. Rogo is the AI platform purpose built for financial institutions serving tens of thousands of bankers and investors at hundreds of leading firms worldwide. Rogo's AI agents autonomously execute large chunk of your firm's workflows. They can screen deals, draft sims, run buyer outreach, and due diligence on data rooms. All with full security and compliance handled. Every action feeds Rogo intelligence, the firm's context layer, turning years of deal experience into a secure, governed institutional memory that makes each new transaction stronger than the last. To learn more, visit rogo.com/invest. So, Christine, I've been so excited to do this with you. I think it's been five years since we last did it. A lot has happened. A ago. You've been very successful in the intervening five years, so I'm excited to catch up. Can you give us like the one minute history of Vanta? I know we've done this before, but just for... To level set for people when you started it, why, what it did then, how it's evolved, what it does now. Quick overview.
00:02:07 · Christina Cacioppo, Patrick O'Shaughnessy
[00:02:07] S1: Started Vanta about eight years ago, feels about about eight Yeah, exactly. You're like in 17 centuries ago with the premise of can we help companies build and own trust and build trust is like start security programs and compliance programs or mature them and then go go get credit for their customers through audits like a SOC two or ISO twenty seven and one HIPAA, etcetera. Security questionnaires, trust centers. But basically this idea of can we build a security company by helping companies implement security because it's what their customer is asking for. So we're initially known for SOC two, billboard. We do have a billboard on the 101 that we're mostly known for making billboards, I joke. But it started very compliance, very audit centric. The idea was always, hey, that's just one way to get a company started on this. Since then, we've gone into different areas of security. We've gone into different ways of earning trust with your customers. Today, we're about 16,000 customers global with about five products. [00:03:08] S0: How did you win? This was a new category when you started and then I'm a ride to go through it. My old business gets SOC two compliant and certified in order to win certain accounts or whatever. So it became an important thing kind of in the software era. There were many companies, I could probably name a handful, that were trying to do what you're trying to do. Yes. You've emerged as sort of the only major winner. What would you attribute it to over the last... Since we last talked, like how did you win?
00:03:31 · Christina Cacioppo, Patrick O'Shaughnessy
[00:03:31] S1: Execution. Software, the blessing and the curse, unless it's more true now even than it was five years ago. You're you're really only as good as the last thing you shipped. You can be first and you can start it. And doesn't really matter. And it was more true now because it's like someone can vibe code your thing in a weekend. So you've just got to constantly be shipping new products, new features that make the experience better for customers running on that differentiation. There's some feature level. I think the other thing we really invested in when it got competitive that was very good was integrations, pulling in data from other tools. So now you can connect Vanta to one of 400 tools. We pull a ton of data out of those tools. And that's what powers the automation agent, the AI, all of that. We call it our trust graph. It's really just like a security data lake. And that is bigger, broader than any other provider, including some of the security providers because we touch areas they don't. And I think in retrospect, that data foundation has let us build new things faster. Software and agent. It was that piece. And then even on the go to market side, it was like just- [00:04:41] S0: Good billboards....
00:04:41 · Patrick O'Shaughnessy, Christina Cacioppo
[00:04:41] S0: Good billboards.... [00:04:42] S1: Pushing good billboards. Shockingly good. Compliance that doesn't suck too much. Which got really popular on raccounting, which none of us knew was a bucket list item in our lives. When raccounting likes your things, you're like, okay, something worked. And then the lived experience is just, you can feel like you are going as fast as you can and you should in fact lean in further and push harder. [00:05:01] S0: What was the scariest moment? [00:05:02] S1: The last twelve months, sasspocalypse, you're like, okay, great job building a system of record. You're now screwed. [00:05:08] S0: You're now worthless. [00:05:09] S1: Yeah, exactly. You're worth like, good job playing the game. Here's some steak knives. Parts of that are true and parts of that are not true. In the vein of you're only as good as the last thing you shift, you're like, great. What is the agent? You have all this data and a system of record. Fine. What the heck are you doing with it? [00:05:22] S0: Similar about what that's felt like. Roughly, Vanta is a business that is growing very fast by historical standards with very high margins. Yes. Which four years ago is considered like the best business model ever. Nothing changed about that. I think you're probably growing faster. Yes. And the margins still really high. And yet the market has decided that the multiple for a business like yours is a third of what it used to be or a quarter of what it used to be. What has it been like to live through that as one of those entrepreneurs?
00:05:46 · Christina Cacioppo
[00:05:46] S1: Cognitive dissidents. You've got to hold two things in your head, right? One is, I think of the fullness of time. A 80% growth business with 80% margins will actually be better than over the same time period, run it out long enough. A 160% growth business with 30% margins. One of these will like return more cash in the fullness of time. But today, the latter is valued at three x, four x the multiple of the former. It's a 10 x multiple of the former, right? And so there's a part where you're like, hey guys, everyone's being irrational here. This is a good business and you have to keep doing things that make business sense and doing the things that customers want, which may or may not be token pricing models that put you more in the latter category than the former profile. And then there's like a very clear like game on the field piece. Well, if you need to be financed, again, you're looking at investors today, many of whom are kind of AI maximalists. Talk to firms that are like, yeah, we'll invest in the labs and we'll basically invest in tractors in Iowa. Nothing in between. Robotractors in Iowa at a lab. And like everything else. You're like, interesting point of view. And from a like talent perspective, you hire ambitious people who want to do things. And if it feels like they're not in the right boat, they're going to change both. The talent war part is very real too. So you've just got to live with the fullness of time. I think this will all sort itself out and you have to live for the
00:07:11 · Patrick O'Shaughnessy, Christina Cacioppo
[00:07:11] S0: fullness of So there's this funny fear that now like bending spoons is the grim reaper in the hallway, you know, meme or whatever. No one wants to be a bedspoon. Love bedding spoons, by the way. I think it's an interesting question of the siren song right now is sell tokens via agents for security and compliance, I'm sure, or something like this. [00:07:28] S1: Lots of thoughts on this. [00:07:29] S0: I'm just so interested by companies like yours that were sort of winners of this last era that now have to make a set of decisions. Look at the ten year rate, the cost of capital is going up because you can put lots of money at really high return in AI stuff for the time being. Someone looking at your business is like, well, I want higher returns or the same returns. And I get that through agents or something. Talk me through what it's been like to make the decisions. What are you thinking today? Do you think of yourself as an AI business? What's that