Larry Gadea Transcript
Clint Betts
Larry, thank you so much for coming on and talking with us today. You're building an incredible platform with Envoy all around the future of work, the future of the workplace. And great timing, by the way, because there's all this discussion of like, "Hey, should we do hybrid? Should we do in person? Should we do all remote?"
And I think the platform that you've built here is quite interesting, that kind of lets people manage, no matter what they decide there. But can you explain what Envoy is, how you came up with it, and maybe we start there.
Larry Gadea
Yeah, yeah, absolutely. And absolutely, thanks for having me. I mean, I'm really excited to talk about workplaces and where they're going and the future of work.
This stuff is changing so quickly. And honestly, as somebody that's just into companies and company building, it's kind of a different world these days and things are changing really fast. And even at the size that we're at, which is like 25-50 people or something, it's a lot of change all the time. But hey, we're trying to stay ahead and we're trying to do our best to really make this great.
Clint Betts
Yeah, it's unbelievable, man. So, tell us the idea behind Envoy.
Larry Gadea
Yeah. Okay. So, what's going on is, we've been around for, roughly, about 10 years now. And we started as what was essentially a visitor system. When people go into people's offices, oftentimes, you need it for security, you need to have certain compliances. What people needed was something easy to keep track of everybody going in and out of their office.
And that kind of, overtime, it evolved into, "Well, I need an NDA signed." "Oh, I need to give wifi." "Oh, I need to collect their driver's license number.' Or sometimes, it would be their car license plate number, so they don't get towed away from parking.
And what it turned into is, all these very practical, real needs that companies had for managing the visitors and stuff going in and out. And really, we transformed into this company, and we've always wanted to be much more than just a visitor system, but that was kind of the growth methodology.
We wanted to be about the office and about people in it, and I'm really empowering people to be their best and do their best work together. And that's really what we want to do.
So, yeah, that's what we've been working on since the beginning. The pandemic definitely changed some things, that's for sure. But it only really accelerated just a timeline of, hey, let's build things around employees and around the experience in the workplace, and how we can really make it a great place where people would want to be, especially in times like this.
Clint Betts
Yeah. Tell me about the pandemic. That must have, oddly, been kind of good for the company. I mean, it's this horrible thing, of course. I don't want to dismiss that. But for Envoy, it puts it at the front of the conversation that whole idea of what workplaces are going to be in the future, how we're going to work in the future.
So, what was that like?
Larry Gadea
Well, at first, it was terrifying. Let's just be very clear here. We built a visitor product, okay? Everybody's locked out of their offices because they have to be at home, because there's a global pandemic going on. That's not great. That's not great for business. I can tell you that, for sure.
Basically, cities would say, "Hey, you're not allowed any people inside your office. That includes visitors." Because everybody was in this kind of loop of like, "Oh, yeah, we're all going back in two weeks." "Oh, yeah, we're all going back in a couple of months." "Oh, yeah, well, when school starts again, of course the kids go to school and the parents go to work."
And it's like, all these things that absolutely are not one on one, it was just kind of this combo that people made up. That's kind of how it ended up. And it just kept on going. It's like, "Oh, hey, yeah, no, there's no vaccine." "Now, there is a vaccine, but some people are concerned, and it's not for people under five."
And so, basically, what happened is, we had to rethink our entire business model because the visitors' piece was not going to work. So, what we noticed is, our customers were very clear about getting some employees back because some people just do not have the choice.
They have really bad wifi, they have construction going on in the neighborhood. They don't want to be at home for whatever reason, be it just like a noise or kids running around, or just stuff going on at home, or lots of roommate situations. People wanted to not have to be at home, so the offices were like, "Well, we got offices open, it's just we can't have that many people."
They had to keep track of people. Have you been near someone that's sick? Have you had COVID? Did you have COVID? No. And then, if there's an outbreak or something going on in their office, you wanted to know, all right, who was this person near? Who did they sit near? Which meeting rooms did they go to? And that's literally how our product suite started getting built. We built a desking product that was designed to know exact desks where people were going, but to get them separated from each other so they don't infect each other.
And then, there were the meeting rooms. And if they went to a certain meeting room, we have software to keep track of that, and then it would get analytics and all that, but it's also useful for contact tracing if they were all in a meeting room together.
So, this is how the product suite kind of really got accelerated from what we wanted in the past. And now, it's like, okay, this is a whole suite. And then, as the pandemic started ending and it was more about like, hey, people are now just hybrid work and nodding to schedule, when are they coming together? And what are they doing together? Should we have more food? Should we have more parking? Do we have a meeting room for all the people together?
So, the products' suite kind of ended up in this place and is where it is today where it's all about the data, the analytics, the operations of multiple workplaces, because companies have way more offices now. And it's about how do we help support these companies that are very distributed now, with very different cultures in different places?
Some offices aren't being used at all, why do they pay for them? They should know that they're not being used at all. There isn't consistency in a lot of... Is this office actually being used? Are people in two to three days a week, or are they in two or three days a week? And people don't know. So, companies are spending a lot of money on these things, and they don't know if they're getting the value from them, and if the employees like it.
And then, when they want the employees in, is it actually happening? Or are words “strongly recommended” effective enough to bring people in? They’re not. But it's these kinds of things that these companies need to quantify. And they're just not getting the help that they need, so that's really what we're about right now. It's about quantifying the operations and how your office works, and what it needs, and making the best experience there.
Clint Betts
Have you seen the business grow and the need for your product grow, post pandemic? I know that it's still kind of going. I mean, whatever, right? But kind of the post pandemic, Joe Biden says it's over, so we'll say it's over.
Have you seen anything where it's slowed down, or has it only accelerated your business?
Larry Gadea
Yeah, it's always complicated. First of all, every company right now, basically, every company is seeing some kind of headwinds of some form, especially in B2B. Everyone's trying to cut everything. So, that is just the status quo. I think it's kind of the way the world should be operating. I thought it was a little too easy.
Just a few years ago, companies were able to get away with some of the most ridiculous things, and it worked, and they got money, and it kept going. But now, it really brings it down to the merit of the software, what's a need versus a want?
But our company, here's the thing, we're building. So, we try to stay in the hot area of what is needed for workplaces. And some companies are really into it, and they really want to have the desking, the meeting rooms, the space management, the parking, all that stuff.
And some companies are fully remote now and they want to stay that way. We see a future where there's going to be both camps, especially this hybrid camp. I mean, we raised last year, it's like $111 million and it was done because of the growth. And it was not future growth, there's just a lot of growth of companies that need ways to measure things. And then, these days, it really is about the growth that happens because of the measurement.
So, I would say, things are pretty good, but I would also say, I kind of wish this whole economy thing wasn't going on as I think everyone does, because it really is making things a lot tougher, but we're adapting, and I think that that's the best part. We're really getting good at what we do.
Versus before, we could get away with a lot of very halfway things that probably shouldn't have been successful but were, now we have to be good at what we're doing. So, I like that a lot, because it gets the most out of everyone, and then it especially includes myself. There's no cutting corners in terms of being good at what you do right now.
Clint Betts
Yeah, that's a good point. It kind of forces you to be good. You have to be good or else it's over, which is genuine.
Larry Gadea
Yeah, you got to sustain it, too. And that's really hard. People can be good in spurts, but continuously is what the market's needing right now. And that is not easy. And I think a lot of people are not built for this kind of environment, so they're becoming that or they're not, but it's letting people choose.
Clint Betts
Anecdotally, most companies are probably going to do some sort of hybrid. I don't see a lot of major companies going fully remote. And I also don't see a lot of major companies going fully in-office. It seems like they're doing three or four days in office, the other hybrid or remote, something like that. Is that what you are experiencing, too?
Larry Gadea
I mean, we have thousands of customers that are all doing, literally, every permutation of this. The thing to really think about is, what does an office represent for a company, and why do they even have them? Now, the common thing is really about like, "Hey, we're doing this because we want to have an office and we want to have people collaborate easier."
And I'm definitely going to reiterate all that stuff. I think it's very easy to see how many decisions are getting made faster, and how faster we're iterating on decisions as well. I think if we're all remote, it's much harder to make those decisions, to iterate on them.
But really, an office really does represent a lot of a company's identity. The office and the way it's built and the cultural values it represents, the things it has written on the walls, seeing that CEO is not as angry as you thought they were in coming out of that meeting, they're not a terrible person, or this other person, that person I work with is not a terrible person.
And you talk about things, you're forced to have a conversation with someone as you're at the salad bar or whatever. These are the moments that make us real and make what we do real, and a real kind of relationship building, versus remote is just a little bit too transactional.
So, hybrid, I think, is... Definitely, for now, at least the next six months to 12 months, is definitely the piece that's going to be the most used. Because it's like, it's a compromise, right? You're always going to win off a compromise. Neither side is going to be fully happy, but it's good enough. As companies do it more and more, that three days will probably go to four or maybe even five, finances really pushing on five.
The companies that never left their office, they're still five and don't care. They're like, "Yeah, we need people in here working on the assembly line. We need people in here working on whatever. We need people in here with clients. We don't care if it's Friday or Monday, they just need to be in here."
Fun fact, 60% of people never left the workplace in the pandemic. So, that's how many—
Clint Betts
Oh, interesting.
Larry Gadea
... people work in industries that are not at all in.You can't use Zoom, you can't use any kind of video, you can't do just paperwork, you're going to have to do it in person. So, that's a lot of people. Of course, it includes retail and all that, too. But finding good ways of bringing people together is extremely important for companies right now, especially in this world of high anxiety, and just people don't know where companies are growing.
Clint Betts
Yeah, that's a good point. It's kind of a privilege to even have the conversation of should it be hybrid, remote—
Larry Gadea
Yeah. Yeah.
Clint Betts
... or in person, right? It's kind of like, in the early days of the pandemic, everybody's like, "Stay home, DoorDash, do all these things." It's like, "Well, somebody does all of those things."
Larry Gadea
Yeah. Yeah. Somebody's dashing the door—
Clint Betts
That's another person on the other side—
Larry Gadea
... and it's not on Zoom.
Clint Betts
So, it's a pretty privileged thing to be able to just stay home and have everything delivered to you.
Larry Gadea
Yep.
Clint Betts
That's a really, really good point. This isn't just about knowledge workers. I mean, there are tons of jobs where there's no choice. You got to be—
Larry Gadea
Yeah, there is. I like to say, in our company, that working remotely is a privilege, not a right. I think it's really important that companies understand that concept where it's just like some people are very good at remote, they're very good at over communicating, they're very good at writing things down, they're very good at giving that and passing it on and making sure that it's passed on, and making sure that it's acted on, and then they follow up.
Most people are not anywhere near that level of ability when it comes to communication, when it comes to follow through and accountability and all that kind of stuff. So, that's why it's just fundamentally can't work where everyone's remote all the time. For some companies, it might. You have to hire management that's very, very good at logistical stuff, where they double check and triple check.
But most companies are just like, that's not the skill set that they can do. And also, there's just not that many people out there that can do that. So, I just think, remote could be maybe work if people really focused on it and had education around it and that kind of thing. But I just don't see most companies investing in that.
I think they need to grow, they need to go quickly. There's a lot of mistakes and a lot of problems that happen in companies, and you need to just patch it up, most of the time. So, it's going to take a while until we get to a point where people could be very, very good communicators. Asking the whole world to be great communicators is a lost cause. I would love the idea, don't get me wrong, but it's very, very hard.
Clint Betts
Tell me the idea behind Envoy deliverables and how that's going.
Larry Gadea
Yeah. So, just a roadmap or a deliveries product?
Clint Betts
Yeah, the deliveries product. Yeah, yeah, yeah.
Larry Gadea
So, we have a few products that make up the workplace. And what we're really trying to do is, really, bring a lot of attention to all the areas of the workplace you may not be thinking about, but are extreme burdens on a lot of people in there.
So, what happens is, a lot of packages and stuff come into an office, be it visitors, which is handled through the visitors' product. Deliveries, there's a lot of boxes coming in, and there's a lot of people that need to pick them up.
So, what happens is, people are at home or at the office these days in the hybrid schedule, and they need something delivered for Amazon. If they're not at home and it tries to get delivered, sometimes it just gets dropped off on your front porch, and then people go over there, they take it, it gets in the rain, all sorts of problems happen.
So, they want a stable place to leave it until they pick it up. The office is a great place. It's staffed by the facility's people. There's somebody going to sign for the package and you can pick it up whenever you want. So, the deliveries product really is just a very simple concept of, it pings the employee every single day until they pick up their package.
That way, things can be moving in that delivery room, but it also just plays to this workplace concept of, the employee could really be empowered a lot more to know what's going on.We have this mobile app where you have a whole map and you can see where the delivery room is, where it got delivered, you can see where the visitors are, you can see the meeting room availability and desk availability, who's that person you're sitting next to.
So, all the stuff is on the map, including the deliveries where you can just know, "Okay, you got to pick this up before you go home.” It's one of the little things, but definitely a big benefit to office managers as they're being asked to do more and more every single day.
Clint Betts
Yeah, for sure. That's super interesting. You mentioned you raised a massive round a year ago. Talk to me about that. What was that process like? Who were you raising from? What's the environment like? I'm sure it's different now, a year later. What was it like back then, as you were raising for something like this? How much money have you raised, and what was the big one like?
Larry Gadea
Yeah, yeah. Let me see here. Our seed round, which was 2013, we did 1.15 million. It was from a bunch of angels. I really just wanted them to tweet every time we launch a new product, because I know how hard it's to get press whenever we launch products. So, it's like, let's get a whole bunch of notable people to just tweet every time we launch something. So, we got a whole bunch of angels on board.
Then, the Series A, it was in 2015, we got that from Andreessen Horowitz. I think they gave us 15 million? Yeah, it was 15 million. Andreessen Horowitz has this whole system of people that help you and your company.
They have HR people because every company that's really small doesn't value HR as much. And they probably should, but they don't. And they know they have people on staff to help you with HR problems, but that's, of course, a minor part of the thing. They also have a lot more around sales and all that. They also provide great advice, given their exposure to really, really top companies.
Then 2017, I think 2018, maybe, we did our Series B. That was from Menlo Ventures with Matt Murphy as our lead there, and he basically has just been a game changer for us and my thinking. And me, honestly, just thinking through a B2B SaaS problems, and figuring things out, and seeing the market dynamics and getting stuff all about sales and salespeople and marketing and the whole pipeline of product development where it touches the go-to market.
So, we raised, that was like 30, 35 million or something like that, that we raised in the Series B. And then, our most recent ones you're asking about is, it was 111 million from Brookfield. Now, Brookfield Growth is the fund, and Brookfield is a massive real estate owner and operator. So, they do both of these.
And so, our whole thing with them is, they know real estate, and they know buildings and what they need and their problems, especially when it comes to data and analytics. So, that was a lot of money that was basically raised to address those problems.
But they're very excited because also, real estate, when we raised, they were starting to see problems already. It was very clear that there were going to be problems. So, what they did is, they just want to invest in technologies that are going to change and help companies have more success in their space inside of their buildings.
So, we built a whole connected product with them, where it's around centralizing the visitor operations for all the tenants and the downstairs, and now we're expanding into building a whole community aspect there. You can do carpooling and stuff, that's what we're trying to build, and door access integrations and all this stuff. So, lots of really cool stuff going on there. And Brookfield's just been spectacular for market data on real estate and also the technologies.
Real estate isvery behind on technology, huge opportunities there. But also, the people are very conservative when it comes to trying out new technologies. Even if it promises really great returns, it's a very like, "This is how we've been doing it," thing, and you have to get good at the pitch.
Clint Betts
You've got some name brand, cream of the crop investors, which is really cool. I'm sure that's super helpful. How do you think about public markets now? I'm not going to ask you if you're going to IPO anytime soon or anything like that. No, you can say if you were.
Larry Gadea
Would love to, but not in this market. No.
Clint Betts
Yeah, yeah. How do you think about it now? Because this market is weird. Does anybody go public anymore? What do you do if you don't go public?
Larry Gadea
Well, we have a lot of money, so we don't need to raise money through an IPO or fundraising. So, we're good on that front. We've been doing our version of a year of efficiency or whatever Mark called it, but it is about, right now, how can companies be efficient and effective and stop being so wasteful in their growth.
I think a lot of companies were growing at all costs, is the phrase, but they were not really measuring that either, and they realized that they didn't need to spend nearly that much to grow. So, there's a lot of analysis and stuff being done there.
Companies are going to have to just be way more efficient and effective in the way they operate. Gone are the days where you can just put somebody on something, and then it grows like crazy, and all this revenue comes in, and woohoo, we're awesome.
You got to really work for it now. And I think that that separator, that differentiator, is extremely important. The companies that really focus on being effective and efficient, but also smart about how they grow. You're not going to grow your company by just focusing on like, "Hey, let's make sure everyone's happy and everything's perfect."
Everyone has to be pushed. We have to be deliberate about executing in an environment that is against all odds. Every company's going through this right now, and I think there's the concept of comfort. It's like, this is not a world for comfort. And it's like, we want to provide as much comfort in the peers when they come together. And that's how we try to play our part in all of this.
But it's definitely not easy for a lot of folks. So, it's a new world, and companies are going to have to adapt. And if they don't, it's going to be really rough for them. But yeah, I don't see us ending anytime soon. IPOs are not happening anytime soon. I don't think anybody's IPOs are happening.
Clint Betts
I don't think so, either. Yeah.
Larry Gadea
And just quickly, even last year or the year before, the meritless IPOs in the form of SPACs, it was just like in 1999. A lot of companies IPOed before. Sometimes, even getting any kind of revenue. And they did this and it's like, of course that didn't work out and it blew up, and then we went to what happened in 2000, 2001.
So, we had the same thing happen again. Instead of it being called an IPO, it was called a SPAC. And these companies that were not mature nor predictable nor ready, got pushed in going public. Everybody had the big moment, "Yay, this is the big success moment we've been waiting for," and it destroyed the technology that was so innovative, so exciting, had so much promise because the business goals came in and they were too immature for that.
I still think they're great companies and great people that did them, but it was pushed too much to the big win. The financial win was too fast expected, and I think the market got what it deserved. But it does take a while to build companies, and we all have to do our best for a long time before the IPO. There's like an average of 10 years or something before a company goes public.
But yeah, that's the world we're in right now. That's why no one's going public, because they're freaked out based on what they saw in the last couple of years.
Clint Betts
When you were starting in 2013, obviously, a completely different world than where you're at now, how were you pitching this to? How did you get the meetings with Andreessen? I think that might be interesting for some entrepreneurs or kind of early stage CEOs who may be watching this or listening to it, just kind of how you did all that?
Larry Gadea
I'm fortunate to say, but there are a lot of relationships that were leveraged as part of it. I'm an engineer. I have been an engineer since the beginning. And these days, the E stands for, I don't know, executive instead of engineering.
When I was at Google, and then I was at Twitter, and I was doing systems back in engineering, and one of the things that I had throughout my career is, people were like, "Hey, I like what you're doing." It's like, "Hey, if you ever start a company, let me know." That's the common thing.
That's why you want to be in Silicon Valley because there's just a ton of angel investors who say that exact phrase. "If you ever start something, just let me know." And then, what you're supposed to do, which I did kind of, is write down everybody's name who has ever said that. And I was thinking really hard about whoever said that. What were the circumstances? I had different managers, different CEOs, different people who I'd talked to while I was at Google and Twitter. These are popular companies.
So, off I go in 2013, I get the terrible idea to start a company, and it's like, "Okay, great." So, I started it, at first, and I wanted to do the checklist of Silicon Valley startups. So, nobody gets paid anything, we'll work really long hours, nothing makes sense, but we're building a product that grows. And it grew because people used the visitor's product at other people's companies, and then they remembered it, and then they brought it to their own company.
So, it is that kind of, let's just say, virality. I don't know if it's too soon to say that word, but let's go with it. It's the virality of people seeing it at other people's companies, and liking it, that got it into other companies.
So, then, when the seed round came in, which was about six, nine months later, I had customers. There were literally customers. We had these big name customers, too. And these are Silicon Valley companies who are easier to adopt new technology, so you have that benefit, too.
And then, it basically started growing. The big names came because I reached out to all those people from before. That was the seed round. And then, whenever an investor invests in you, the thing that nobody does that you have to do is tell them, "Great, you're so excited about it. Who else do you know? And I want a list. And we're going to call them all together."
And then, they bring on a whole bunch of more people. There's this guy, Yishan Wong, that started the whole thing. He was super excited about what we were doing, and then he introduced us to Jeremy Stoppelman, who runs Yelp? And then, Jeremy Stoppelman happens was mentored by Marc Benioff.
So, I'm like, "You know, Marc, I saw an article that said you were mentored by him, so you know the guy, right?" And he's like, "Yes." And then, I'm like, "I want the intro." And then, he's like, "Okay, cool." Because he wants to be helpful. That's the best thing that these investors can do.
So he introduced me to Marc, then we got Marc as an investor. And then, I tried my luck to try to get Elon, but that did not work. Elon, apparently, doesn't invest no matter what the upside, but because they were a customer of ours. And then, after trying to beg, he stopped answering my email. So, that's typical.
But it's just like, it's these relationships and putting that extra step up, but you have to leverage the people you already know. And then, by the Series A, it was just the growth, the numbers were really good. It wasn't crazy revenue. I think we just hit a million in ARR, but the companies we had on board and their addiction to the product was just unheard of. So, the virality and the whole theory is like, "Hey, you hire a great sales and marketing team, and you can really leverage that for growth."
And honestly, it was true because now, it's just growing more and more. We have a great sales team, great sales leader, great sales kind of mentality when it comes to pitching the workplace as opposed to just a visitor thing or a deliveries thing or a rooms thing. And then, from then on, it just snowballs. You got to keep the growth up, though. There's nothing that can get around that, so you've got to keep your growth going.
Clint Betts
I can't think of anybody better to be an investor in your company than Marc Benioff. I mean, that is very perfect. That's the perfect investor and perfect mentor.
Larry Gadea
He's really busy. That's the unfortunate part. Obviously, you should expect that he's going to be really busy. But I mean, he answers emails and it's pretty good. I mean, honestly, I know how busy he is. I know a million people are reaching out to him all the time. I know the drama he deals with. Actually. I probably have no idea the level of drama he deals with on a daily basis, but I know mine, and I know if he's at that size of company, it must be absolutely more wild. It definitely never gets easier, that's for sure, so I'm sure that he's getting used to it.
Clint Betts
Yeah. What did you learn at Twitter, speaking of Elon? I mean, you weren't there, obviously, through this, but you were there kind of early days Twitter. Who was the CEO when you were there?
Larry Gadea
Right as I joined, it was Jack, and then it switched to Ev Williams. And then, from Ev Williams, it switched to Dick Costolo. Jack came back a little bit. He wasn't CEO, he was some other thing that was like that. And then I left, Jack took over, and then I don't know what happened. They promoted somebody, and then Elon came and brought a sink inside.
I mean, I loved it. 2018, 2019, Twitter had 40 employees, and I was like 41 or something. And it was chaos all the time, and it was freaking awesome. I enjoyed it to the max. I would get a page every single night at 3:00 AM durinng some kind of downtime, and there would be a problem. There's a lot of other people that would get paged. It was a little bit very unsustainable, let me just be clear, but it was like you were in the moment. It was live, it was real.
There were people very upset that they could not get their tweets working. And at the time, we were doing the internal propaganda around, well, just people that use it for medical emergencies and earthquakes and that kind of stuff, so that's why it's important that the tweets flow. But it was a little bit of an adventure, but I freaking loved it because it was real. And if we knew that every single person in that company could destroy the company overnight, if they did not do their thing.
And there's just nothing like when you put yourself in a position where you have to do things, or else the company dies. So, that was really, really, really fun. And we kept on growing and growing. It stayed that way for a while. In the three years I was there, it was like, 1,500 people? Imagine 40 people to 1,500 in—
Clint Betts
Yeah, that's crazy. In three years, that's nuts.
Larry Gadea
You're not just doubling.
Clint Betts
That type of growth is absurd. What do you think about it now, with Elon taking over? It's now a private company. Who knows what it is? Actually, my experience on Twitter has not changed at all between ownership, except for there's more blue checks now. But how do you feel about it? Where do you think it goes from here?
Larry Gadea
I don't know. I think it's important that companies are who they are, and don't fake it, or really try to put on a show for others. Twitter has changed so much in the last few months, let's just say. I saw this checklist the other day where it was literally about a hundred things that Elon has changed in the time that he was there.
And everyone's, of course, looking for some kind of way to say that this guy's crazy and he is really dumb and everyone's going to like, "It's all going to fail." And they keep saying that over and over and over again. And I just don't know why people are so excited about saying people are going to fail, but let's just go with it because... I don't know, this is how people bond today or something.
So, what I've seen is a ton of change and a ton of bold decisions being made, and I like that. On principle, I am going to like it, I'm going to fight for that because that is what you do not get in companies. As companies grow, they get more and more conservative, they take less bold risks, they're less exciting, they change the world less except through revenues that they get.
So, if you want to change the world, if you want to make things big and exciting and different, you have to iterate a lot, even if it makes you look like a clown. And that's kind of what Elon's taken to heart and how he executes that place. So, now, yes, does he make really weird decisions here and there? I'm sure he does. And every once in a while, I have my own moment of, really, this is the ultimate plan. Okay, fine.
But it's also, anybody that's making big changes, they're going to make a lot of mistakes along the way. And I need to be supportive of people that take big, bold risks, because there's not nearly enough people out there, versus the people that are going to attack them. We can't be promoting a world of, "Hey, see, I told you they'd be wrong, at some point."
This is why you get politicians that aren't allowed to have complicated views on things because then they're like... Well, they're flip- flopping, they're changing their mind. And it's like, new data, new minds. Sorry, guys—
Clint Betts
Yeah, that's exactly right.
Larry Gadea
... this is what I'm going to do. Yeah. I don't know. I'm always going to be supportive of people that take big risks no matter how crazy it can appear.
Clint Betts
Do you think he set a tone in other companies and maybe a cultural shift in other companies when he laid off as many people as he laid off, and showed the world and these companies that, "Hey, you can do quite a bit, at least as much as what you're currently doing, with a lot less."
Larry Gadea
I mean, you're always going to have this balance. Now, they did have the existential kind of circumstances, so I think it's kind of like they had, too. It is very interesting though to see that company operate with so much change. And they do have some problems today, don't get me wrong.
Clint Betts
Yeah, sure.
Larry Gadea
They have plenty of problems. But it's amazing, right? 20% of people, they used to have. What were the other 80% doing? And they were doing things, but the problem is that those 80% also wanted to do more. But it's very hard to organize so many people where everyone is as empowered as they could be. And that's really the issue.
As companies get bigger and more complicated, people are not as empowered and not as organized. And you get in this world where you have to add three people to do what one person could have.
I think it does speak to management, it does speak to how to best manage. I think people that work under Elon work a lot, and I think they really enjoy what they work on because if they did not, they would leave immediately because they work a lot. So, it kind of self-selects, and that is also part of it, too.
Going back to the comment I said earlier, companies need to choose who they want to be. So, if you want to be a company that has people in the office, for example, you need to say that and you need to be clear about it and stop kidding everybody about how like, "Oh, yeah, no, we really want to just be mindful of everyone's everything." And it just doesn't work. These people are so confused as to what your company wants and what they want to do. Just be clear on it.
You want people in five days a week? Great. You want people in zero days? Great. Say that. You want people in six days? Freaking tell them that, so they know to make their decisions about, if they did, that is the place for them.
All this strongly recommended and suggested and all this kind of stuff confuses people like crazy, just needs to stop. This is the exact industry our business is based on, and I really like it because it keeps companies real, and we're seeing so much success out of companies that are just super clear, and they're getting their workplace, they're measuring all the things, they know all of their different workplaces and how they're doing.
And that is just so powerful to these companies. They can see that, hey, it's not everyone complaining, it's only a little section. Or this office isn't used at all. And then, they know, okay, maybe we don't need that office. I know the guy says, "I don't know, it's between two to three days a week, but is there a baseline for that? Are they calibrated to other offices?"
So, that's really what our stuff is about and why I enjoy being in the space that we are. It causes a lot of drama, don't get me wrong, but it is very meaningful right now, the work that we're doing. And that's what gets me excited.
Clint Betts
What do you think of this whole idea of the Silicon Valley exodus? And actually, Elon's kind of at the forefront of that, too, even though Twitter's still in Silicon Valley, moving Tesla to Texas and things like that. What do you think? I mean, is there still the inherent value that there's always been, that you couldn't find anywhere else to start a company in Silicon Valley? Or do you think it's actually being distributed and you can do something very similar in places like Austin or Miami or Utah or wherever it is?
Larry Gadea
You're always going to be able to do whatever you want, wherever you want. It's just, the battle is like, how much of an uphill battle are you willing to tolerate. You're always going to have downsides. There's always going to be downsides to everything, and companies are surprisingly resilient, but you just have to spend more cycles in a different area that you otherwise don't have to.
I think Silicon Valley is still pretty good. I would not say it's excellent and spectacular, but I don't think any city right now is excellent and spectacular. I think that it is about community building, it is about getting friends that are of the same role in other companies, and meeting as often as you can to talk about the issues and how you're all not just crazy, and it's just like this is happening, companies, everywhere.
I do think it's easier to get VC money around here. The people are here. The companies that ended up investing in us, they came to our office. We talked to a lot of people that were just Zoom calls, because that's when everybody was raising hundreds of millions of dollars over Zoom. And it was silly. I don't know how these investors did any kind of diligence or anything. There's something about like, how in it are they?
So, the ones that came to our office, definitely, were the ones that ended up bidding to invest. The ecosystem is like, you start a company, you grow in it, it has an exit, you make lots of money, you then start a company, you then build that company, it makes even more money.
You now have an existential crisis about, what do I do? I'll never be able to make them the same amount of money again. And it's like, nothing's worth it anymore, and then you start really being real about like, "No, it shouldn't be about the money, it should be about how you're changing the world." And then, they turn into a VC, and then that's when you fund the companies that are starting. And that's the cycle.
So, I have no intention of being a VC. I could never have that many meetings and retain any kind of stability because it's just too much. I massively respect the people. I can have about 20 meetings every single day and 20 cups of coffee as well.
Say you want to buy some software. One company is selling you software over Zoom or over email, and then the other company literally flies over to your office and they pitch it to you in person. You're going to choose the one that flew to your office. And because you know that they care, that they just spend a bunch of their time to come to you, to sell their software to you. And it's like, that is going to be the differentiator in a world of just competition. The one that shows the most amount of effort, the one that does the harder thing is going to be the one that wins.
And that's how our philosophy has been since the beginning on being in person, and that's why we value it so much. We're like a hundred percent, a thousand percent, actually, in leverage in the workplace. And the workplace being great for people, and I'm super proud of it.
Despite all of the pandemic things that would never happen to us, but did, for sure, and we just figured it out.
Clint Betts
Well, there's another thing that's disrupting everything, which is AI. And how does AI change your industry and workplaces, in particular?
Larry Gadea
Yeah. I think AI leverages a lot of data. It’s really important because it is going to make life easier for the people who do something. In a workplace, it's all about the data that you feed the AI, and it's about how do you optimize that space the best? Why do you have 20 desks when there's only three people in that satellite office? Why do you have air conditioning running all night and all day when it could be just only during certain hours when people are in there, were scheduled to be in there? Why do you have traffic?
It's all these different bits of data need to be analyzed continuously. And you could have humans do it, but they're not going to do it continuously. And I think, especially in a world like this where people are trying to save money everywhere they can, and the CFOs are basically running the places everywhere, you need to be able to optimize your customers' workplaces and operations, in general.
For us, AI is all about prediction, it's all about detecting that, "Hey, this room is being booked by somebody who's not in the office, and the other person has declared that they're not going to be in the office. Therefore, cancel that room, get them on a Zoom call and problem solved."
Detecting those situations and being able to predict when that's going to happen is extremely important for space management. And that's the kind of stuff that we build with our software, but it's also kind of how the future of the workplace will be. It'll be very kind of predictive of what's going to happen, so they can optimize.
And it's going to turn into people using other people's spaces, too. Maybe your neighbor downstairs isn't using their space and it's like it's going to give you hints around that, it's going to give them a revenue opportunity. So, we're really excited about just the space and the automation that's possible and the insights.
Clint Betts
Yeah, I actually talked to a startup recently who's doing, basically, like the Airbnb version of offices. We're like, "Hey, just come use this office for a day and pay us 200 bucks or something. Or use it for a month." And I actually think that's a pretty interesting idea. I'm sure plenty of other people are doing that as well.
Last question. Same question I ask everybody at the end of the interview which is, at CEO.com, we believe chances are just as important when they're given as when they're taken. So, we take chances on ourselves and other people and things like that, but also we have the opportunity to give chances, and sometimes those chances that are given to us are super meaningful and life changing. And I wonder if there's anyone who has changed your life and given you a chance that you could tell us about?
Larry Gadea
Yeah, I completely agree with that. And I actually think there's another level of it which is like, they've given you a chance and you screwed it up, and they still continue to give you a chance. And I think that that is even next level. So, I would absolutely say, our investors, for sure, Matt Murphy, in particular, from Menlo Ventures, the guy is just super resilient when it comes to like, "No, Larry, you're going to figure this out. And look at the market, it's like this."
But it also leads to opportunity, and I know that you're only seeing what you're seeing, but it also can get better. And then, there it is. There's that motivation that I needed to really push on this very tricky initiative that we wanted to do.
Matt's been really, really awesome. It's really great when you can have a board that you like, and especially investors that you can really, really like. Matt has been an absolute star for us. I'll call him for the randomest of things, "Oh, this exec is leaving, and what should I do on this?" And he's like, "Oh, this is the one you've been talking about for the last six months, as you've been having trouble."
It's like, "Yeah, but it's different this time." He's like, "No, it's not. It's always like this. It's fine. Don't worry about it. Stop freaking out so much. This is totally normal. And here's the people I know.
And it's really cool when somebody can have your back, despite them knowing this is going to screw up their investment for the next however long. Matt's been awesome. He's been super supportive, the ups and downs, and you really want that in investors. So, yeah, really, really big fan.
Clint Betts
Ah, that's incredible.
Larry, thank you so much for coming on. I encourage everybody to go to envoy.com. I think you've built something incredible. I can't wait to see where you take it. Good to see you, my friend. Thanks so much.
Larry Gadea
Nice. Absolutely. Thanks for having me.