· Alexander Taubman
[00:00:00] S1: Well, thank you for saying that. We've got an amazing team. We go back a long ways. Zach and I first met at Goldman when he was a summer analyst. I was an analyst. He introduced me to Rasmus, our co-founder and CTO, who he was at Oxford with at the same time as I mentioned was top student there. The sort of team came together through network. And so, the first 20 people, I think, were all from network and people that we knew deeply from both an investment acquisition side as well as applied AI technology. We're growing much faster now. We're closer to 60. We're still small. At Long Lake level, we're only about 55, 56 people now. We'll probably be closer to 100 people by the end of the year. It really is a world-class team. It's, I'd say, 90% AI engineers and operations deployment folks, and then 10% sort of acquisitions, M&A finance. But yeah, I do think you need to be able to do three things really world-class to be able to deploy this technology. You need to be able to buy great companies well, so you need a great M&A function. You need to be able to build amazing world-class technology, so you need world-class technology that rivals the labs or some of the best applied AI companies. And then you need change management operations. Because we were purpose-built and because we started with the big vision of we want to really kind of help change the whole economy, I think we were able to attract much better people, and that's been starting to compound now. And we still, I think 75% of our teams come from referrals, from in-network referrals. So we have a very strong, and it's a very tight filter, as you can imagine. I think this quarter, we hired 3% of applicants, basically. And we saw, I don't know, close to 1,000 applicants this quarter. So we have a very tight funnel, just like we do for deals. And I think one of my biggest learnings is just high bar in everything is really the key. And so high bar in talent, high bar in acquisitions, high bar in technology, and that's kind of what I think you need to make this work.
· David Senra, Alexander Taubman
[00:00:00] S0: What initially got you interested in finance to begin with? [00:00:00] S1: I just loved it. I grew up in a family of entrepreneurs. My grandfather, who was a big inspiration to me, started a real estate business after World War II. [00:00:00] S0: He essentially invented the strip mall. [00:00:00] S1: Yeah, the shopping center. Yeah, yeah, yeah, exactly. He didn't actually do strip malls. Well, he did probably earlier in his career, but he eventually did- [00:00:00] S0: There's a great quote that you gave me about him called "threshold resistance." [00:00:00] S1: Yeah. [00:00:00] S0: Can you talk about the idea? Why would it be called threshold resistance?
· David Senra, Alexander Taubman
[00:00:00] S0: Can you talk about the idea? Why would it be called threshold resistance? [00:00:00] S1: Yeah, so the concept, by the way, it's a fun reference. We have it in our office. But basically, the whole concept of threshold resistance is you want the shopper to be more likely to go into the store. So he was sort of an early pioneer of retail. He just thought he could make things better, and actually that was a big inspiration to me, try to make things better in life. And so one of the ideas was the threshold is the entrance to the store. And the more you had to step up steps or go down some dark hallway in order to get... And that's how stores used to be designed. There used to be these big windows with merchandising in them, and you'd have to go through the windows in some dark alley in order to get to the door in the back. Nobody fucking wanted to go in them. So his idea was bring the door to the front, have no threshold, have it be the same, like that over there. You can't see, but that, you want to walk through that. [00:00:00] S0: Because even a step, he broke it down almost like a math equation. [00:00:00] S1: Yes. [00:00:00] S0: Even like half a step up reduced it by like 20, people coming by like 20%.
· David Senra, Alexander Taubman
[00:00:00] S0: Even like half a step up reduced it by like 20, people coming by like 20%. [00:00:00] S1: Exactly. He did a lot of really creative things that I can tell you more about it. He was very innovative, and he always brought this kind of continuous improvement mindset, similar to like the Danaher continuous improvement concept. And honestly, it's all a big inspiration for me. You want to make it so easy and so magical for the shopper to go into the store that they'll go in and spend more money, ultimately, which is good for the store and all that. And actually, some of those principles, I think you can apply more generally, like with technology, for example. We want to make Nexus so magical and so easy to use that our team members just love it and they can just use it. You want to minimize threshold resistance on AI adoption. [00:00:00] S0: This is exactly what you're talking about. It's like, hey, the reason we can have this horizontal AI platform is because 70, 80%, it's like every business deals with the same shit. [00:00:00] S1: Yes.
· Alexander Taubman, David Senra
[00:00:00] S1: Yes. [00:00:00] S0: When you were just talking about this, I just recorded this crazy episode with Travis Kalanick from Uber. It was fucking crazy set, exactly where you are, and we talked for hours. And he was breaking down in minute detail about even like every single page you would see at Uber compared to Lyft, and he's just like, "Every single little thing." He's like, "And there's a thousand things I had to optimize that if you're just copying me, you copy what you see, but you don't understand the thinking behind it." And this is exactly what you're talking about. It's like this guy's just obsessed with shopping malls or shopping centers and realizing that, "Hey, I'm going to knock six inches off here and my bottom line, my profit increases by 25%," or whatever. [00:00:00] S1: By the way, I think it's very much the same with technology and websites and Amazon that came later and things like that, which was just these little tweaks can really impact behavior. And just by making things better- [00:00:00] S0: It's why both my podcasts, like Founders has no intro. I just get right fucking to it. And this one has like a six-second one. Just like, no one wants to sit through that shit. [00:00:00] S1: Yeah. [00:00:00] S0: I'm listening to your podcast so I can hear some 30-second melody that you made? Like, no. This is not a concert, dude. [00:00:00] S1: Yeah. [00:00:00] S0: Get right to the point.
· David Senra, Alexander Taubman
[00:00:00] S0: Get right to the point. [00:00:00] S1: Yeah, exactly. So I grew up in this family of entrepreneurs, and my father and uncle ran that business for 75 years. And so one of the inspirations, we called the business Longlake because that business was built and lived on Longlake Road for the last 40 or 50 years in Michigan, where I grew up. And it was actually a funny story about- [00:00:00] S0: I know. I dismissively called you an East Coast finance guy, which you know I love you and we're friends. I was like, "Shit, I forgot he's from Michigan."