I was offered $200M at 24 and I turned it down

Transcript from https://podmenti.com/t/7d543fb2722ab228

All right, today's episode is special. We've got Matt Moloweg. Matt founded a company called WordPress, which is used by something like 45% of all websites on the internet. So it's just a huge thing. And we talked to Matt about a bunch of interesting things. Sean, what did we talk to him about? He had an offer to sell his company for$200 million when he was 24 years old. He turned it down. We asked him what that was like.
We talked to him about
Some of the recent drama that they've had. We talked about how they've been acquiring companies. They bought the small company in South Africa and how it turned out to be.
a huge thing for their business, like a you know, a billion dollar plus win.
And he's just a student of the game. He's been doing it for like twenty years. This guy started this company when he was nineteen years old.
and is still doing it and it's become this absolute juggernaut. So enjoy this episode with Matt Mullingway.
It's travel never looking back
Tell me if this is right.
almost too good to be true, but I had read that in two thousand eight you had an acquisition offer. I think you were only twenty four years old for two hundred million dollars. At that point, I think you'd only raised a million dollars. And I think you raised a million dollars at three million in valuation. Something like relatively
You're twenty four, you're gonna be worth nine figures, something crazy like that.
You turn it down.
But then you talk about how you didn't have control of the company because you were young and maybe just like made some mistakes with funding and something like that.
what's the conversation like with yourself when you're like
I'm turning down something that might make me worth over a hundred million dollars at the age of
twenty four.
You talked about and you name the first million.
It's kinda funny, like
I guess technically on paper, my first million was that first funding round, right?
In theory, I owned like half the company that was now worth four million dollars.
But as you know, like that's paper money. I was still you know eating ramen and uh and mouth and doing pizza and like living, you know, a very broke San Francisco.
College kids like
But it was in in two thousand eight that uh we had this acquisition offer.
You're right. It was uh about
Two and a half years of this company.
Someone tried to buy us for two hundred million.
And the investors at the time.
Did something which now is quite common, but at the time was was pretty forward looking, which is a a secondary.
So
They said it.
Said wow.
Yeah, we're twenty people. We've been doing this for two and a half years. A two hundred million dollar exit would be pretty amazing.
Like I said, I would walk away personally with a lot of money.
But
We think this could be actually way bigger.
So let's let's build that.
And so we took that acquisition.
Made it evaluation.
Yeah.
Turn that into a funding round where we put a a lot more capital into the company. So we could, you know, really build things out.
And I sold some stock myself.
So I that was my first that was my first million.
Liquid.
was kind of in two thousand eight, I think I was twenty four.
And that was a step change, you know, I was able to like
pay off my credit cards and
Buy my mama house. Like, you know, all that sort of stuff that you you want to do that you dream of.
And it sort of removes some of those um
sort of early economic things and I was really able to focus on just the business and swinging for the fences.
Which is what they want me to do.
You know, I hear these stories like Zuck turns down a billion dollars from Yahoo or whatever.
this story about you at such a young age turning down the opportunity to exit and have this huge
Payday.
I think you're a better man than me. I don't think I would have been able to resist that. Was that a easy decision for you? Was that a hard decision? Like what and like you're like, I think this could be bigger less go for it. Is that just like
Not blind faith, but just like an extreme amount of self confidence and faith. Like how do you even
Or did you even want to do it and the investors were like, Nah, too bad.
No, it wasn't an easy decision at all.
Of course. Also as a fiduciary.
You know, like you have a responsibility to your shareholders.
Consider every acquisition.
acquisition offers and people trying to buy automatic.
Yeah, as recently as this year.
I think you have to ask yourself with any acquisition.
Like we'll
the mission that we're doing be accelerated.
By this transaction.
Or will it be hampered?
It's like we acquire a lot of companies. Like WooCommerce, I think, did a lot better.
Because we acquired it.
Then they would have on their own.
But there's probably other

That we didn't buy that did really well on their own. Reddit was one actually.
We we looked at it at one point.
Did you look at them?
In their conde nest ten million dollar valuation days.
I actually really wanted to buy Red. I couldn't convince my board.
They thought it was like too outside of our early stuff.
So we never got that far in the discussions or anything, but yeah, there was a point when they were like four employees and for sale and kind of in the wired offices on Third Street in San Francisco.
I just thought it was really cool. So obviously they they well.
But when you created WordPress, it seemed like it took off, like within a year.
I forget which year you started it, but like I said earlier, I think I was using it starting in like ten or eleven, two thousand ten, two thousand, like pretty early on.
And I at the time was like
A Tennessee college kid. So if I had heard about it, then a lot of people had heard about it. What was the first version of WordPress like?
Two thousand three. Oh wow, okay. I wrote a blog post on this called like Meaningful Overnight Success.
Because basically like what people see is overnight success.
Is often
A thousand days of
irrelevance or people haven't heard of you.
Yeah, at one point it w there was a joke that WordPress had more developers than users.
The first few blogs, which is ones I set up for my friends in high school.
Yeah,'cause no one was using software, so I just kinda like would manually set it up for people.
Yeah, early
We used to do these upgrade parties where just I'd say like
you know, a new version of WordPress will come out, I just open up my apartment.
You know, go to Costco, bought some booze, or it's a pizza and said, Hey, just come to my apartment and I'll upgrade your site for you.
So yeah, we really you know, the early days were very much bootstrap, you know, just doing everything.
It it looks like overnight's tests later.
Uh we had some breakout points, you know, when Movile type changed our license and other things.
I think fortune favors the prepared. It was because we had put in a lot of grind and a lot of work.
Lot of community building, a lot of contributions, a lot of code, a lot of everything.
In the
Many, many days before that.
But what's crazy to me is I remember like four or f six years ago it said that WordPress
was used by something like thirty or twenty percent of all the websites on the internet. Then recently I went and looked at it and now it's like forty percent.
And like the thing that struck me, I was like, Are you the most under monetized business on earth? How are you not like the biggest company on earth? Because I used WordPress and I used WooCommerce, which you also own at my old company.
My Woo Curt Commerce license, Sean.
I think it was a three hundred dollar
Lifetime or three hundred dollars a year.
And the product that I was using it
was making many millions of dollars. And I've got a friend, Sean, you and I both have a friend
Who
made a hundred million dollars off of the three hundred dollar a year license or w whatever it was. It was like nothing.
You guys have to be like the least monetized company there is. I think the way I put it is WordPress is almost like kind of the dark matter.
of the web.
You know, when you build like a list of like what's the top website.
And then we're not gonna show up.
I mean WordPress.com will be in the top one hundred or whatever. The beauty of it is that the ecosystem of WordPress is probably like ten billion dollars a year.
At least.
Of revenue.
Now my company automatic.
Is yeah.
Five percent of that.
But
If you add up all the companies and all the people. I'm not even counting like all the stuff that you talked about, like people selling things on WooCommerce, which we know is like a
I think last year was over thirty billion of goods and services sold through WooCommerce.
But actually more than half of automatic's revenue comes from things that aren't just WordPress.
So we have
A variety of different businesses.
Some really cool mobile apps like Day One or Pocket Cast.
A new one called Beeper. What were like the top two acquisitions, right? Like even Buffett, for example.
If you study Buffett's portfolio
It's like a huge amount of the gains came from like a couple of like really key acquisitions at Key Time, right? Sees Candy at a specific time has given them over a billion dollars, I think, of free cash flow over the years. What's the revenue number that you could say the whole company does?
We've publicly say we're we're over half a billion in every now. Okay, got it. All right. So yeah, to answer Challenge question, what's been the surprising thing. What are like the crown jewel like best acquisitions that you feel proud of? Our most successful is probably WooCommerce.
And so
This came a lot from
Yeah, WordPress is a platform.
And so I did a lot of study of platforms.
And so that led me to do a lot of
Deep reading on Microsoft, actually.
And it was funny, like if you look at some of the press around Windows ninety five coming out.
They talked about how for
Every dollar.
That Microsoft made from Windows.
There was twenty dollars made by the word.
Windows ecosystem.
By the way, that ratio
It's similar to the way I talked about earlier, where automatic makes about five percent.
The money in the workplace ecosystem.
I sort of found that platforms often do this, they create a lot more value. A true platform.
Have you heard that story of Bill Gates uh talking about the when he meets Mark Zuckerberger, he talks about the Facebook platform? Have you heard this? There's like a quote I remember reading, which was like
Gates was like this is not a platform.
He goes a a platform is when the
Companies built on top of it generate far more value than the the the host platform. Whereas the Facebook platform at the time,
was like Facebook was this garganton thing, all the sm small things on top.
And Facebook was just sucking a lot of the value back in. And he he kind of famously was like that's not what a platform is. I would agree with that assessment.
And also that's not a platform which
Now a lot of businesses are built up.
There were some that sort of came up in the early days, like Zenk or whatever.
Or Spotify even.
But it it's now not something that like every business is built on because you can get rug pulled.
Like uh a not true platform, they might give you some distribution early on when you align with their interests, but then they can easily pull the rug on you.
Which I think Facebook ended up doing to a number of companies.
So yeah, I want to build a true platform.
But of course Microsoft famously
Had Microsoft Office.
So they had an application built on top of Windows, which ended up being very lucrative. So
It was like what's gonna be, you know, I have this platform, WordPress, which is now becoming like an operating system for the web.
We were obsessed about backwards compatibility and auto updates and things like that. Learning a lot from
Successful operating systems fast.
What's our Microsoft office? And that ended up being WooCommerce.
Which was uh
So a small company, like I think forty people.
Based out of South Africa.
Plugin for WordPress.
It actually started as a theme company. It's called Woo Themes.
They developed this uh actually a fork of another open source e commerce thing.
And they they started doing it just to sell more themes.
Yeah, because themes were kind of the big business for WordPress at the time.
And this e conference plugin.
Took off a bit.
Actually, we looked at buying it years prior.
Yeah, candy the code was really crappy. And so we were like, Oh, this is like really crappy code. We're
You know, Automac's very much like a engineering led like technology R and D company. So we're like, Oh, this is
But it just kept taking off because they did such a good job, like
Building something people want.
So even though the code wasn't scalable, well organized.
You know, they built something, they they were really great at that product market fit. So WooCommerce was taken off.
So we that was an early acquisition that we did.
Funnily enough.
the competitor there was there were there's a private equity that was trying to buy this plug in.
So we kinda won over the private equity because they wanted to join like our culture and everything like that.
And woo, you know.
Like I said at the time.
It was
Forty people.
Pretty small. They only had like four engineers, by the way.
So a lot of those people were like customer support or other things.
we were able to take what we were really great at, which is like engineering, scalability, all that sort of stuff.
And apply it to what they had.
Done really brilliantly, which is like
Create this.
Think that people
I love to use.
And that's like I said, I think last year did over thirty billion of
Good service sell.
So that's that's uh definitely one of our our best acquisitions that we've done.
But I also that e commerce is
An incredibly competitive space.
And you know, we're we're blessed to have incredible competitors Shopify, which is
A company I have a ton of respect for. You know the
founders and entrepreneurs and the whole thing. They they're actually a really, really great company.
Yeah, Toby and I I think have a lot of mutual respect for each other.
Yeah. Driver's be better.
So
Do you look at that? Uh this is again like
Kind of giving you a compliment and an insult at the same time. So the backhanded compliment is in full effect here. So on one hand, we're saying
Oh my God, there's forty three percent of the internet uses
WordPress or you know y y'all's products.
There's five hundred million websites using WordPress. Like that is just such a mind boggling number.
And so on one hand, that's in absolutely incredible. And on the other hand, Sam was saying
Are you the most like under monetized given that are you the most under monetized because you look at like a Shopify
Shopify alone, right now, market cap is a hundred and fifty billion.
The ruthless capitalist could say.
Matt, you're doing all this work.
Your whole company, including WooCommerce and all this stuff, is gonna be worth
Several billion dollars, but
The closed source.
Shopify variant of of of the of the e-commerce side is worth 150 billion. What should I take away from that and what do you what do you take away from that? What's what meaning do you put on that?
There's definitely some things that are easier.
In a proprietary
sort of closed ecosystem software model.
Um you know it's easier to
Yeah, Shopify is really great at forcing people to use their payments, for example.
And in WooCommerce, you know.
You can use ours, but you can also use a lot of other stuff.
I think their sort of average revenue per subscriber is is like ten X what what WooCommerce is this.
How I think about it is is very much sort of short term versus long term.
So one we have this
Philosophy.
Of open source.
I want all of the work I do, all of my creative output to increase.
The amount of freedom.
And liberty in the world.
I'm just something I I believe very morally. So that's why I've dedicated my life to open source.
like as open source software, you sort of have a bill of rights attached to it, right? The freedom to use this software for any purpose to see how it works, to modify it, to redistribute its modifications, the four frequency of the GPL.
To me, that's that's a moral decision.
The software I create, I want.
Not to have a proprietary license.
Yeah, Sho Fi is amazing.
If Shopify changed your policies tomorrow.
Their customers.
Or stuck with it.
They have their recourse under a proprietary license.
uh or with open source.
Yeah, we could change our policies tomorrow. I could become evil or whatever.
And automatic
could be yeah, sell or be a terrible company, you would still own all the code.
Yeah, WordPress and WooCommerce, et cetera, belong just as much to you as they do to me.
And that sort of freedom and liberty is I think better in the long term.
So I say open source has a slow burn.
So it often is kinda slower to start up.
But then over time it builds sort of this compounding momentum.
that is a bit unstoppable.
And
Does two things. One, it
can be very successful on his own, right? As WordPress has, you know, it's 10 X, the number two in the market.
But two, one great thing it does is it forces the proprietary folks to be a bit more open.
So I I use proprietary stuff myself. A lot of Apple things are proprietary and I you know, I I really love their products.
I think Apple is probably a bit more open than they would be otherwise because Android exists.
There's there's an open competitor.
And it was
by the way, open source and
That it kinda influences the market.
So even if we don't have make as much money as Shopify or don't have the market share of Shopify in the e commerce space. Yes.
Although
you know, check in in ten, twenty years. Let's see where we are.
We force the proprietary folks to to be a bit more open with how they do things.
The the short answer there is basically
I do it because that's what I believe. I believe in open source. I just believe uh that the moral decision comes first.
And secondly
In the long run.
Let's see. Uh in in the long run, uh we'll we'll see. Is that is that a good a good summary? Proprietary it's just as easy to have a failure of a proprietary company as it is an open source one. So I think you know, being proprietary open source is a little more authority.
Or not causal to like whether you're a successful product or not.
people get really attached to it. But
I would say in the short term it's definitely
Usually a bit easier to monetize.
purely proprietary stack.
But over long term you can create a much, much bigger thing if you have this kind of like
flywhe of an open source.
uh community adoption, et cetera.
Innovation. You know, ton of innovation happens with open source.
By the way, Sam, isn't it nuts that
Matt is clear like this thoughtful
Омослай солфу он тупренер.
Who has been building this thing since he was literally like a kid, nineteen nineteen years old.
Like a guy you'd call wise when he was twenty one.
Yeah, exactly. Like oh he's an old soul type of thing.
Works on open source software. Like you said, it's
Widely used. It's
Almost free. It's so like only good. All I hear is like only good. And then you had this like random
villain arc that people tried to paint on you in the last, you know, year with this like drama that's going on. I couldn't believe it. I was like, if I was gonna put money on who's like the least
Drama
attracting founder. It might have been you.
So I thought that was nuts. Sam, uh your reaction to that real quick, and then I want to hear Matt's thoughts on it. So I didn't follow it too much. I'm a WordPress user, but I just and I'm friends with Jason Cohen, uh of WP Engine. You guys had a a fight, but
I was actually shocked, Matt. I thought that some of the stuff that you said
I was sho you like people were insulting you and you felt like I insulted them back. I was like, I've read a lot about Matt's work. I don't know Matt.
And I've listened to him.
He doesn't seem like someone who would ever like insult someone.
And I was actually surprised that you were going as hard as you were.
And I guess your perspective is like they're coming after everything I made or they don't contribute, whatever. But I was actually surprised that you were
Pissed off and I didn't think that
you would be the type of guy that would come off pissed off.
Yeah, a failure mode.
And
I think that can kill many open source projects.
is one that they get get taken advantage of.
And so just like a schoolyard bully.
Like you kinda have to stand up.
Yourself
It's kinda funny because you say you don't think of me of doing this, but actually if you look at the history of WordPress
There has been
Maybe four or five times.
The history.
Where I had this kind of villain arc. People were like, I we had a fight to protect like our principles and and like the sustainability and like the future of WordPress.
Can you give the one minute summary of what happened? Cause I even half followed it and I'm sure there's a bunch of people listening that that don't even know what we're talking about. Could you give like the one minute and try to be objective with this, like
Like not not just the your side of the story, but just what what it what happened. Can you explain?
You know, it's an ongoing legal battle, so I can only
Say so much.
Basically there's a a company called uh WP Engine.
Start it off like
very positive in the community. Jason Cohen, I think, is awesome, by the way.
But in twenty nineteen they were bought by a private equity firm called Silver Lake.
And sort of in the subsequent
Five years.
Started
Becoming
I would say more parasitic.
WordPress.
Also creating with how they were marketing themselves and branding themselves.
A lot of confusion in the marketplace in a way that was threatening our trademark. Yeah, the WordPress trademark. So people
would sort of say, Oh, it's WordPress engine and they wouldn't correct them and they they would think it was official. I even had very close friends
Who were WP Engine customers.
Who thought that was my company.
And I would frequently get support requests for W bench and like my sights down and things like that.
Yeah, for a long period of time, and you know, two years prior to this fight started.
Just doing our best to partner with them and resolve all these things and resolve the trademark stuff.
They just weren't responding.
And basically WP Engine is a web hosting service, maybe only for WordPress sites.
And the accusation, I believe, was that you felt they weren't contributing
to the project as much as they should have been, given that they make like a lot of money and also people confused
The two companies. On the contribution thing, is that like like I guess like what's your leg to stand on on that? For example, you know, like
Does somebody have to contribute? Is that like a rule or is that a a s a s suggestion, right? Is this like uh you're at church, you should put something in the tray, but you don't have to, technically, but you're fr it's frowned upon. Like what is the take there?
So in WordPress we do have this program we call Five for the Future.
By the way, this is all voluntary. This is open source license. You don't have to do anything. You do whatever you want.
But we say that if you're building a business on WordPress
You can allocates.
Yeah. Somewhere between zero one and five percent.
Profit or revenue?
It doesn't matter. However you want to define it. Could be time, could be hours, could be whatever.
But
And put that back into
What we call court.
Core WordPress, which is something that belongs in the open source project. So it's accessible to everyone. Doesn't just benefit your company.
That's part of what's made us so sustainable and allowed us to be a
Open source project which
has really thrived more than you know some of
Yeah, other great CMSs that were open source that came up at the same time, like Joomla or Drupal or something like that.
which haven't has as much success as us.
By the way, I think this is
Great self interest as well.
WP Engine is fairly unique in that pretty much every other company in the WordPress ecosystem does this quite a bit.
And in fact
If you look at old versions of W B Engine's website,
They were
Yeah, very supportive of this. And
Actually even say on their website they would
Dedicate, you know.
two or four t full time people and everything like that. Yeah, fast forward to twenty twenty four.
They were had less than that.
Of course.
So I think that's that's a whole like
Uh sustainability.
Health of the ecosystem, health of the product issue.
It's not a legal issue.
At all. The trademark abuse uh
Not just the WordPress but also the WooCommerce trademark.
So you could argue that WordPress
W P whatever, but like they were also using the WooConver trademark, which is fully owned by automatic.
You have to protect that. If you don't protect your trademarks, you lose them.
And so we're having discussions around that. We have trademark licenses with other web hosts.
Great relations with every other. And they're they're just a web host. They're not a tech company. They don't really create a lot of IP.
And their web hosts which
People think is the largest but they're actually
You know, probably
The sixth or seventh largest WordPress webpost. There's a lot of bigger ones.
They're a single digit percentage of all the WordPresses in the world.
Yeah, they probably have like seven hundred thousand, eight hundred thousand or something.
So
People have made this into a bigger deal than it is.
Yeah, so these previous controversies
That
Got mainstream media coverage as you know, CNN.
I had this hot nacho scandal of the first couple of years of WordPress or
A thesis fight or the Eastern Massacre of Thieves. Like all these things I'm mentioning you probably haven't heard of.
It used to be like half my Wikipedia page.
No it's not.
Today if you go to my Wikipedia page, the their PR firm has the whole paragraph about this.
I think at five years
maybe it'll be a sentence or not even out there at all. So it's not my first rodeo.
Sometimes you have to fight to protect your open source ideals and the community and and and your trademark, by the way.
I expect this to resolve in the next few months.
Although it's easy to find like
You go on Reddit or Twitter.
I get a lot of hate.
A lot of people were pissed at you. I I tweeted out that you were coming on
to the pod yesterday. If there was a lot of angry people and I was sh I was a little surprised by that, to be honest.
Yeah, and you know, some of the people are uncomfortable with, you know, us having to
To fight protect ourselves.
Yeah, WP engine
Took some of very aggressive legal action.
So turned out when we thought we were sort of good face negotiating.
They were preparing a legal case to attack us because
you know, three days after I gave this presentation, they launched this huge lawsuit with Quint Emanuel. It's kinda like the
One of biggest, nastiest law firms.
You know, private equity is so famously like
Goes in, hollows out businesses, extracts all the value, kinda kills it.
It's this crazy story I have you saw recently where like
One of the reason there was like shortages of fire trucks.
In LA.
was like the fire truck manufacturers have been like rolled up by private equity.
And they've been like jacking the prices and that was like huge waiting list for like fire new fire trucks and fire truck repairs and
There's lots of examples. Not all private equity is bad. There's good investors and bad investors in every asset class. Look, I I I didn't follow the story.
In depth. I didn't need to. I'm not a lawyer. Don't need to be. It's common sense to me.
Whose side am I gonna be on? The uh the private equity backed company that's that you know, sounds almost like it's made by the by you guys, but it's not.
Or the founder who's been working on this for like, you know, twenty plus years of his life, open sourced it.
is y you know, used by everybody. It's kind of like a staple of the internet.
And you know, captures like a tiny bit of the value along the way.
It's pretty obvious to me, uh, you know, which side I was gonna gonna come down on. So I I think it was a it was actually a common sense test, I think, for most people. And I can't believe how many people are like
You know, on the PE side. It actually reminds me a little bit of like the AI stuff right now. Wait, Sean, we did a whole podcast about the founder of this PE firm, though, and how like fascinated we were with them. We do profiles on ruthless killers, and then we're at the end, we're like
Isn't that awesome? Yeah.
Do you want to be that way? Hell no. Like that's not me. But like I'm glad that these people exist. Like you need all these people in an ecosystem. Like it's not
They're not all bad and there's impressive things about
How
I think example Egan Durbin or whatever they uh like I think that's the guy that we talked about.
Yeah, the
It's impressive in the same way that David Goggins is impressive, but I'm not gonna go out there and run until my toenails bleed. Like I like that he exists. That doesn't mean I wanna be like him or even that I think that's the right thing for most people to do.
I think it was on uh
on your blog. It could have been on the Tim Ferris podcast. You wrote about how
I think WordPress or Automatic has like
roughly two thousand people. And I think you wrote about how
You
tried a bunch of different ways to hire people.
You like did all these tests like Google does, like these like brain teasers, and you tried a bunch of other stuff. And you said two interesting things that stood out. You said what I have found is that uh the people who
are the best writers oftentimes are the best people.
Who we hire.
Not PhDs, not master degrees. It was a a correlation between your ability to write and communic communicate via the written word. And then the second thing you said that was pretty wild. You used to hire people just by like emailing or texting. Like it was like just through chat.
Not
Ever face to face, not phone calls things like that. Do you still hire people strictly
Through text communication. Yeah, for some roles we might do a Zoom. If it's a sales role or something like that, you know, obviously it's important to see.
Someone uh interacts.
But basically, you know.
For a lot of our roles.
You know written communication is gonna be the primary thing.
But also like people want to talk to someone, like we're not gonna be like, Oh, you can't
Yeah, a lot of our hiring process can be completely asynchronous and completely text based.
And for the first thousand or so hires, I did a final chat for every single
Person.
Is your chat like
Slacking or G chatting or something. Yeah. It ended up being on Slack when when Slack was invented. You know, before that, I think it was on like Skyper Aim or something, you know, in the early days or or IRC. I think the way you said it was uh we do auditions, not interviews.
So what what does that mean? How do you how do you do auditions?
Well, we do a trial project.
So we actually hire people on a standard sort of twenty five an hour
Contracts.
And so we pay them.
To do
Yeah, we have screens with, you know, resumes and a little interview and stuff, but then we say, like, let's actually do some work together.
And um and there's various versions of this for different roles. We've done sandbox versions. We've also done it where they were actually talking to real customers, you know, like a support person was actually like answering real tickets.
We've always been a little bit more than a little bit.
Smaller than a lot of the big tech.
But we compete with them.
And so we need to have like the same caliber or better of talent.
So
Part of I think automatics advantage.
is we've created an environment and also sort of a way of hiring.
That finds people who
Might be overlooked.
by sort of a a Meta or Google or something like that.
And we give them a opportunity not just to be hired, but also to participate in a company.
In a way that they can still be just as influential and have as much impact.
'Cause even like you know, there's there's other companies that might have remote workers.
But if you're not at headquarters, you're not gonna be, you know, close to the sun, you're not gonna be nice to see you, you're not gonna be able to grow or
Or have an impact. But
We've tried to create it where our center of gravity, our headquarters, is really on the internet.
And now
I have colleagues in ninety countries.
I D.
Even though we're only, you know, seven hundred fifty people.
And another sort of innovative thing we do
We didn't do this in the beginning, but we moved to it probably in like twenty twelve, twenty thirteen.
is uh we pay people the same salaries regardless of location.
So
It's it's kinda funny because with all like the equality DEI stuff, whatever, so much of a
feel like is virtue signaling.
'Cause if you ask these companies and say like hey, you know
I'm not gonna call anyone out by name, but let's say big tech company.
Do you pay someone in Pakistan the same that you pay them in California?
Usually the answer is no.
If they're doing the same job.
Yeah the same. Like
Code Wrangler, engineer, whatever like that.
And uh they usually say no, and they usually have some reason. Like hostility or local markets or whatever.
But we sort move to where we said, Hey same work, same pay.
Yeah.
Something that
Yeah, the past hundred years.
Yeah, that wasn't always true for men and women either. Yeah.
Yeah, or or racial things or something like that. So I think the same moral reasons why you say like same work for same pay.
of you know people of different skin colors or something like that.
Within a country.
I think you should do that globally.
And I think that's the future of work actually because
to extent that you can be equally as valuable.
And generate as much value for a customer.
Wherever you are.
Um you should receive the equal pay for equal work. Have you guys read um American Kingpin, the story of uh Ross Albright?
The Silk Road.
Have you read that, Matt? I think I've read some of the Longfront Wild articles, but I've never read the whole book. Yeah. Oh, you gotta read this book, man. I'm rereading it now because he just got released and it's like the best book I've ever read. It's like a total page turner.
The story of it for listeners, basically Ross Albright was accused and I think he did it, where he started Silk Road, which was eBay for drugs. In two years it did two billion in sales, gross sales, something like that.
But
What's crazy is it kinda sucks because this whole
business was documented because he chatted with everyone like he had twelve co-workers.
And
He did two things that were interesting that I actually think are gonna be common. The first thing is that he
Obviously because it was an illegal enterprise. He never
They didn't know the identity of the workers. It was just their username. Like one guy's name was like Chronic Pain. That was his username. So he just he didn't know this guy's real name. He just knew Chronic Pain as like the guy. Ross knew everybody's name. They didn't know each other's names or his. He made them send a license.
So that he could basically have that like, you know, always have that in his back pocket, lev have leverage. But chronic pain didn't know Ross's sorry, I forgot that was actually an important detail.
That's actually very similar to like early hacker culture. Yeah. Everyone was sort of known by their username. There's like interesting merits to that. And then the other thing was that they
only communicated via messaging.
I was reading this book, I'm rereading it now, and I was like, those two attributes are kind of interesting for a company, which is like
Anonymous workers and but you're still oddly friends. Like he be he developed relationships with his co workers. This is a great LinkedIn post for you, Sam. Like thirteen management lessons I learned from the Silk Road. Here you go.

I believe that he did murder for hire a four times. He did a lot of bad shit, but he was actually an inspiring leader. Like when you read like some of his like like stuff.
Well, he was very idealistic, right? Like he b he had certain beliefs that drove right. He he didn't int like he didn't necessarily
intent like, for example, he wasn't super interested in selling guns on the platform, but he believed that people should be able to sell what they want.
And his team was like, No, no, you shouldn't do this. This is gonna increase the target on our back. Like, you're cool with the drug side.
But you don't care about this. So let's just ban it. It's gonna cause problems. And he's like, Well, no, that's not the ethos of what we're doing. Like
We wrote a creed of what we stand for and why we're doing this and therefore we gotta stand by it.
And they called him captain. You know, it was very much this like we are revolutionizing thing. And that's like a really interesting thing. Matt has a uh you you don't get called captain, but what is your like a benevolent dictator for life, right? BDFL?
It's a term in open source that's applied to like
Linus at Linux or we do a Python or something like that. David Hammer, Hansen at Rails.
It's sort of a joking thing and one that I think none of us like really attach ourselves to. Uh, just kinda like an internet lower thing.
Well you do a couple of other interesting things, right?'Cause you got this like
multi billion dollar company used by most of the internet.
But you run your company these interesting ways where remote work, I think, is
You're famously were early and heavy into remote work, and you've talked a lot about that, but you do a couple of other interesting things. So we talked about auditions instead of interviews.
But you also do
Everybody in the company, including yourself
Works customer support, I think one or two weeks out of the year. Can you talk about that one?
Yeah, part of our hiring process is your first two weeks of doing customer support.
Uh, for every single hire.
Whether you're like our new CFO or chief legal officer or
Or whatever role it is. And then once a week a year you rotate back into doing customer support. By the way, lots of companies have versions of this, so it's definitely not
Anyone were the first to do this or anything like that.
Why should a company do that?
If you look at every successful business
The closer they are to customers, generally the more successful they are.
And so
It's very easy, especially when you're running something on the internet and distributed for
People to become numbers or stats.
Or something on your look or dashboard or something like that.
And so, you know, getting back to like
Every individual.
Every number of your signups. You might have five thousand signups in a day.
But each one of those people is like has a story.
You just learn a lot about your product.
And it's I think the best way.
Sort of do iterative customer developments. I think Eric Rees talked about this, or Steve Blank, you know, the kind of like get out of the office.
And go meet the customers. And I'm very inspired by like leaders at Salesforce start the Mark Beetney offer.
Something like that.
They'll typically spend a quarter to a third of their time with customers.
Even at that scale.
Is there a story or any i epiphany you had from doing this? You've probably done this now, uh you know, for for
Decades, so
Is there like an insight that came from this?
Just the other day, a few days ago.
I spent like thirty, forty five minutes.
With the gentleman who kind of
checks expenses at the company.
Yeah,'cause I mean we have like these ramp cards and people expense things and stuff like that.
Yeah, sometimes we like
Say you need a receipt for this, or you question an expense.
I just want to understand more about this and also make sure that the way we were doing this was the most hated man at the company.
By the way.
Like, well I had gotten some feedback from folks they felt
You know, some of the questions they were getting felt a little aggressive.
And so, you know, we we want to talk about
One, I just kinda wanna see like the tools he used and how the work did and stuff like that. So some of that was just shadowing.
So I was like, okay,'cause I want to understand the interfaces.
This was also really helpful, like going through support.
I realize that some of our internal tools like don't represent
Yeah, best practices and design or usability.
Yeah, so the internal stuff doesn't get the love that your external stuff does. But then also, yeah, we just sort of talked about like
Culture of automatic bedside manner, if you will. Like how how can we like
you know, hold these principles. Like we need to
really enforce our policies and make sure we do, yeah, we get audited and and everything. So like we we need to have
these things from like a good accounting principle's point of view.
But also doing it a way that like when we have these conversations.
We're talking
About the principles of it.
Yeah, and the reason why.
So it's not just like I'm giving you Sean a hard time because he did have a receipt, but like
Hey, if we don't have this receipts.
Yeah, it's an art of our
might question this and then, you know, that might create an issue for XYZ or something like that.
When I first moved to Silicon Valley, I w I came to work with this guy, Michael Birch, and he was he represented everything I wanted. He had already built like
successful tech companies and he had made it. And I was a twenty three year old kid who wanted to make it.
And so I'm super excited to go into the work the first day and I'm like, oh I'm gonna learn so much from this guy. Cause he'd not just done it one time, he's built like four successful companies. I'm ready for him to teach me the kind of like the dark arts. I'm like, what's the strategies, the growth hacks, what this like super like high level strategic thinking.
And the very first week he puts me on not the new shit.
Like the oldest company that he had started. Something had started back in two thousand and one.
It's like birthday calendar or something.
Yeah, birthday alarm. Is that still going?
Birthday alarm. Still going. And so I as like 25 year old company now. So I at the time I was like, Oh man, like I gotta do this, like whatever.
And he
Tells me the story. So I actually learned this v really valuable lesson in it. I go, So what's the
I got curious.
Because instead of just like being bored at doing like birthday alarm, which you know seemed like this old outdated product at the time, I got a little curious. So I started asking him like
Where did this come from? Like how did you even come up with this idea? Why did you build this product?
And what he told me was he goes, My very first startup, I had quit my job. I wanted to like
Build a successful tech company, like do an internet company. Internet was like the new thing back in ninety nine, two thousand.
And he quit a high paying insurance job.
while his wife was pregnant and was like, I'm gonna make it. So he tried to create something really fancy. So he's like
Oh, with the internet. He tried to create something that many people have tried, like Sean Parker tried to create this, a self updating address book, which is like
You know, y I have your information, I have your name, your address, but you move, Matt. Now I I don't know that you moved
So wouldn't it be cool if you could just
Update your info in one place and it updated in all your friends' address books. So we now have your latest and greatest address. So that's what he wanted to build.
And
He's spending like nine months heads down, like doesn't leave the bedroom coding this thing.
And it's not really going anywhere.
But
Because he was a one man show, he was also doing, you know, he was the designer, he was the developer, he was the ops guy, he was the customer service guy. Like
He did all of it.
And he was like, it's the customer service that was actually the key, because he was answering support tickets, and he's like over and over again.
He's like, I spent like you know, seven hours a day banging my head against the wall trying to figure out why nobody wants to use our product. I think it's so cool, but nobody wants it.
And then then the hour I was doing customer support.
He's like, I noticed that a bunch of people kept thanking me for the birthday reminder feature I had built in. Like just the one feature which was like a throwaway idea.
Which was just if if you know, forget the address. If it was someone's birthday, I would just tell you, you know, hey, it's their birthday today. Remember that.
This is before Facebook existed, right? So you didn't have Facebook or or a bunch of other ways that people could do this.
So he just threw away the whole product and renamed the company birthdayalarm.com. And he's like, I expect it to go nowhere.
And
That was the thing that took off. And a you know, at that time
birthday alarm had generated for him and his wife personally
Like
Probably twenty million dollars of pure profit.
By that time.
'Cause it was just every year was just generating a few million dollars of profit.
And it's still to this day generating a few million dollars a year of profit. Like it's this incredible business. It's just a gift that keeps on giving that only came
Because he was answering the support tickets and he got curious, like Huh.
Like
Why are they keep talking about this birthday reminder thing? Is that is that actually maybe I should do that. And he did it on a on a whim, and in then in two days
had built the product that actually people wanted, you know?
That's awesome.
I have one last question for you and it's on AI. So there's a lot of stuff you could talk about with AI, but I just am curious
On your quick take about Deep Seek.
Because it's also you know, they came out with this open source thing that there's a lot of people
on either side of of bel you know how much they believe about the story, but like what's your quick reaction to what you saw with Deep Seek?
Deep Seek's a a really cool model.
So you know, every model has like kind of a vibe of the way it's tuned and everything like that.
And so it's a really fun one to play with.
And I would say
Yeah, the thing I I tell people
With all this AI stuff, just like use it, play with it.
You know,'cause it's such early days.
And there's kind of a
You know, the way to prompt it, the way to interact with it.
There's a uh a skill there.
Oh that you'll learn.
And the vibes of of the deep seat model are very cool.
I think what's
I'm most excited about is an open source
guys that they actually
open source the model wrote really amazing papers about how they built it and it opened weights.
Like for example
At my company.
I would say
Don't use like
Deepseek dot com.
Yeah, for various reasons. That's hosted in China and stuff like that.
But like we can run the model ourselves.
Yeah, locally.
And that's pretty cool.
Or you can get it through Perplexity, which hosted in the US. So like there's there's lots of ways to access it.
It's a it's a really fun model.
So all these models have are like good at different things. They have a coding version. They just released a cool image thing and stuff.
Think of these as like little entities that you can interact with and run and spin up and boot.
And uh you should just learn the nuances and and kind of flavors of each one.
Matt, do you guys actually believe that they've only taken the amount of funning
that they've said.
Five or ten million dollars.
They said that's what it costs to run the final training.
That might be true for like some
Something.
But uh obviously like
I'm sure they've spent invest a ton in in in other things. So
And I know there's kinda this
theory that maybe that's like a
A PR or Psyop or whatever like that.
When I started reading about them
Yeah, I got fearful.
It was pretty insane, right? That the market reacted the way it did.
that you know, it wiped out uh a trillion dollars.
of value in twenty four hours. It it it was pretty wild how
big that announcement was. I didn't think it I didn't think that was gonna happen.
And I think you called it, Matt. Didn't you like tweet about this during Christmas time?
Well, uh Andre Capathy, you know, so full credit like tweeted about this like the day after Christmas and I I saw his tweet and retweeted it. So that's when I first learned about Deep Seek.
Start playing with it.
Yeah, I think that with all these things
There there's some
You can
verify all the things. They they made some amazing advancements and like
how they train things and how they run things and how they did memory interconnects and and working with the constraints.
They have some really cool engineering breakthroughs.
And they shared it.
And this is stuff that I think OpenAI had also figured out, but they hadn't like shared it publicly.
And so what I love about the deep seed guys is they uh they're open sourcing it all.
So uh and it's all available under like a true open source license. It's not like the Llama license where
It's free until you have seven hundred million users or something.
I think
Quinn Alibaba one, which is also a really great model that people are sleeping on. So check out Quinn and
Some of these other models coming out of China. They're really, really good.
But it's it's a true open source science. So
That's awesome.
Matt, thanks for coming on, Matt. It's good to see you again and thanks for sharing everything you did about about WordPress.
It's been a pleasure. Yeah, we appreciate you, man. All right, that's the pod.
I feel like I can rule the world, I know I could be what I want to.
I put my lawn in it like my day song. On the roadless travel, never looking back