Sanjit Biswas Transcript
Clint Betts
Sanjit, thank you so much for coming on the show, means a lot to have you here. You are the CEO and founder of Samsara. I think it'd be good for us to start with what is Samsara and how did you come about founding it and becoming the CEO?
Sanjit Biswas
Yeah. Well, first, Clint, thanks for having me on. So Samsara is a company focused on the world of physical operations. We build technology to basically give these companies greater visibility into everything that's going on, which helps them be a lot safer in terms of their operations, more efficient, and more sustainable. They use less energy, in other words. And we do this with data. So we provide sensors, an analytics platform, APIs, and everything they need to be able to see everything that's going on. So, in terms of our size and scale, we've been around for about nine years. Publicly traded companies, all the financials are out there, but a little over 1.2 billion in annual recurring revenue. We're a fast growth company, and it's been fun to build. So we built a number of different products. We serve over a dozen different industries. We're now global, and it's a really fascinating way to see the infrastructure of the planet.
Clint Betts
Well, it's incredible. The growth is incredible to go from nine years. You're a publicly traded company doing that much in revenue, which is insane. It's pretty beautiful that you've done that. What were the first few years like?
Sanjit Biswas
Well, there's a little bit of a backstory to Samsara, which is we were fortunate to have a great founding team. This is the second company that a few of us have worked on together. My co-founder, John, and I met at MIT almost 20 years ago. So we've been working together on technology for a long time, and we started a company called Meraki prior to this, which focused on Wi-Fi. So, two thousand years ago, we thought Wi-Fi could be big. Turns out it did become really big. We wanted to make it easy for people to build big networks. That was essentially our PhD research from MIT put into a box. We turned that into a multi-product company and became a platform of its own that became part of Cisco.
When we started Samsara in 2015, we had a great group of people with whom we'd worked on Meraki, and we were able to hit the ground running. We started the customer first with this one. We said we wanted to serve the world of physical operations. We think the infrastructure of our planet is vast; it's really important, and not enough people think about it and work on it from a tech perspective. So we wanted to be helpful, and that's how we got started. To be honest, we didn't know the first thing about operations. We've never driven a truck or a forklift or worked in a warehouse. So, a lot of learning along the way, just getting out there, spending time with customers, and then going back and building products to solve their problems.
Clint Betts
Yeah, so are your clients like manufacturers? It is like the wide range, but it's certainly like people who are working in warehouses or manufacturing plants and those types of things.
Sanjit Biswas
Those types of things. We typically do the most work out in the field. So, if you think about a field services company or an energy utility company, they tend to have thousands or tens of thousands of people on their team, like a big frontline workforce. They have a lot of assets. They often work in dozens of different locations at once. So there's a lot of complexity, and being able to get all of that into the cloud is really valuable to them. So we focus really on that world of field operations today. We do a bit of work in loading docks and warehouses and distribution facilities as well, but most of the complications really happen out in the field.
Clint Betts
What have you learned about the world and the way it runs based on what you do?
Sanjit Biswas
Well, how much time do we have? There's so much interesting stuff, and this is really part of the world that few people get to see unless they work within it. It's the world behind the curtain. So, there are just amazingly dedicated teams of professionals who do this work every single day. If you think about the logistics industry or utility, it just takes a lot of labor and manpower to really keep this infrastructure running. There is huge attention to detail and a lot of complexity. It might surprise you. A lot of these industries are quite risky still. So they're putting their lives on the line to do their jobs, which is something that very few of us experience when we work at a desk. And so it is a really interesting and diverse set of industries. No two are really the same, but the commonality, I think, is just great people, a lot of good teams, and then just a lot of hard work.
Clint Betts
And you sold your first company to Cisco, right?
Sanjit Biswas
We did.
Clint Betts
What did you learn about leadership, about building a company, growing a company, and that first one that you've taken and applied here?
Sanjit Biswas
Well, the first startup, as I mentioned, really was an outgrowth of our PhD research. So, we almost started with the technology in mind. It didn't take us long to build the products, but we didn't know that much about the sales side of things. We didn't really know how to build and lead a large organization. So, we learned a lot by doing it just for the first time as startup founders. We were fortunate. The revenue grew very quickly at Meraki as well, doubled every single year, even through the 2008 recession and global financial crisis. So that taught us a lot of just life lessons about, okay, how do you stay focused? How do you deliver for customers? How do you build great products? You need an organization to do that at scale.
So, really figure it out bit by bit. Meraki was about three-four hundred people when it became part of Cisco. So, it's not tiny, but not massive, either. And Cisco was a really interesting learning ground for us in terms of how a much bigger company functions. I think at that point, Cisco as a company had been around 30-something years and had been through many different stages and cycles. So, we also learned a lot about what it looked like to lead at scale as part of Cisco. Both sets of lessons have been relevant for us as we built Samsara, which is now a multi-thousand-person company. And somewhere in between. We're not a tiny startup, nor are we a very large, almost a 100,000-person company. Not yet, at least.
Clint Betts
Yeah. And when you were starting some, Sarah, how did you think about raising capital, raising money? The first time you did this, I assume you raised venture capital and all of that. How did you think about it this time? Have you made any changes, and what do you think about capital and raising it and things like that?
Sanjit Biswas
Yeah, I'll tell you about both companies. With Meraki, we started that company in Boston because we were at MIT, and out there in the mid-2000s, there wasn't really a robust startup ecosystem. Firms like Y Combinator hadn't yet been started. I think they might've been starting the same year we were. So, the long and short of it was we didn't have access to the angel funding that startups in Silicon Valley had access to. And we essentially bootstrapped the business in the very early days. So we went out to early customers, and we resold the product, telling them, "We'd like to build this. If you put an order down, we can go make it happen." And that's how we got the company off the ground.
Later in that year, we did raise capital, and Sequoia Capital, Google, and a few other companies got involved at that point. But we were fortunate in many ways to not have access to capital at the very beginning. It really forces you to figure things out. And so very brief bootstrapping period. Then it became much more of that classic venture-backed venture or startup where series A, series B, and so on. Sequoia was our lead investor there, and then we had a few others join us along the way. These days, companies tend to raise a lot more capital, just relatively speaking to back in the two thousands, I think Meraki, we had really three major rounds of financing, about 40 million. I think technically, we had four, so about 80 million total.
We didn't use all of it, and it was because of growing up in the financial crisis that we didn't know if the next round of capital would be there. It was very important for us to be operating right around cash flow break even. In retrospect, a lot of lessons were learned there as well about financial discipline and always having a plan that was rock solid. So, there is a lot of learning there. With Samsara, at the very beginning, my co-founder, John, and I essentially angel-funded the company because we had proceeds from the previous venture. And then Andreessen Horowitz became our lead investor in the series. We partnered with another firm, General Catalyst, a few years later in the series C, I believe, and then they were our partners effectively right up the run-up to the IPO. We brought in a bit of growth capital and then took the company public in December of '21.
Clint Betts
Those are like the top grade A venture firms in the country, Sequoia and a16z in particular, but even General Catalyst, an incredible venture fund. How did you pitch them? What advice would you have for entrepreneurs or those types of people who were trying to get those types of firms and that type of talent on their cap table?
Sanjit Biswas
Yeah, I think there's a lot of advice out there about raising venture capital, but to be honest, I haven't even consumed all of it. There may be better advice than what I can offer, but for us, it was about building compelling products, engaging with customers, and showing real business momentum, such as, Hey, there's something here. In other words, I think the venture capital community sees a lot of companies, so their pattern-matching ability is very quick. They're able to just immediately say, okay, this looks like a great team. This looks like a very interesting or underserved market, or ideally, both markets that are very large, and this team and this technology in this market could really have something special. So that's what we tried to demonstrate: basically, get the risk out of the picture and show a working product. We would demo at our investor fundraisers, even though we weren't necessarily selling Wi-Fi equipment or selling fleet tracking software and other operation software to investors. They appreciated seeing that the product was real. We would tell stories of customer impact, and then we would encourage them just all the customers. And that did it for us. And we were also very lucky at all of these firms. We ended up working with the folks running them. So, Doug Leone was our partner from the early days at Sequoia. Marc Andreessen has been on our board since the early days at Samsara, and these are folks that, again, see a lot of companies; they make decisions very quickly, and they move with conviction. They say, "Okay, this makes sense. If they can keep executing, they hit these metrics; it makes sense to double down, and so on." So we didn't spend a lot of time pitching. In other words, we spent most of our time doing and serving customers.
Clint Betts
Well, that right there seems like the advice.
Sanjit Biswas
You got it.
Clint Betts
What made you decide to go public? What was that process like, and how has your life changed from being a private company CEO to a public company CEO?
Sanjit Biswas
Yeah, so we went public about three years ago. It was December of '21, and it was chaotic. You rewind the clock, we were just coming out of the pandemic. There were still multiple waves of all the different alpha and delta and Omicron and all that stuff. So, the world was still a pretty wobbly place. There'd been a ton of capital infused through the stimulus dollars. The stock market had been doing some pretty wild things, but we were actually the last company to go out from an enterprise software perspective before the IPO window closed. So, in some sense, the timing worked out well. The decision to go public was something we had been thinking about for a few years before that, and it was really driven by our customers. So, if you look at our business, I mentioned we serve large physical operations companies. Many of those businesses have been around for 50 or 100 years. They're large, they're well capitalized, and they tend to be fiscally conservative.
So they want to know that they have a partner who's also well capitalized and well run, and they want transparency around the financials. So, being public really helps with that. So, instead of needing to talk to our CFO, we just say, "Listen to our most recent quarterly earnings, call or check out the numbers." That's been a huge help as we've served these kinds of businesses. So that's the main reason for doing it was the customers wanted to see it. I also think many, many great technology companies have been built in the public market. You think about amazon.com; it's maybe one of the most amazing stories of when they went public in 97 and what they are now. Almost all that value has been created in the public market through some tough times. So I think it's actually good for hygiene and discipline and that operating rigor. So it's funny, a lot of folks ask, why did you go public? Why not stay private longer? And I think of it as, well, this is the natural form for a larger company, and it's not a bad thing to have to operate with discipline.
Clint Betts
Yeah. Oh yeah, for sure. How has your management changed over the past year and a half, two years, as everybody's talking about? Hey, you have to be profitable, cut costs, and all that type of stuff. Obviously, Elon was very publicized and made tons of cuts everywhere. Then a bunch of others started doing it; Zuck did it at Facebook and all these other people. How did you think about it during that time, and how are you thinking about it now?
Sanjit Biswas
Well, if you think about it, the theme there is about being fit and lean and efficient. I think that is important for businesses because it's easy. It's almost easier once you've experienced success to start loosening up a little bit. And I actually think, over time, that can be really dangerous for a company. You lose focus, and you lose sight of what's most important: just serving customers and building products. For us, we use frameworks like the rule of 40, which is that balance between growth and profitability, and it's for the last many quarters that we have been above the rule of 40, and as a result, we've been investing in the business. So we've been essentially adding headcount but in an efficient way while maintaining the growth and profitability. Very core to how we operate.
We tell everyone in the company transparently, "This is how we think about it," and we've been posting good numbers. So most recently, we've been growing in the thirties of percent, so 37% year-over-year revenue growth, which means positive free cash flow, which means that it's working for us. We should keep it up and keep doubling down. So, the biggest management change for us has been communicating these frameworks internally. It's not just the leadership team, but it's really everyone in the company who knows what it's about and then demonstrating that, okay, if we're efficient, it lets us reinvest, and it's a sustainable efficiency. We can reinvest massive amounts of capital back into the company, and that's really fun because it means we can build more products and reach more customers, and everybody's here to have an impact.
Clint Betts
What does a typical day look like for you?
Sanjit Biswas
It varies based on whether I'm on the road or not. When I'm home... I've got three kids, so I do school drop-off in the morning. They're pretty young. They're all elementary school-age. So that itself is the management challenge that is the most challenging, I feel, some days. And then I typically am in work mode. Most of the usual hours, I try to be home for dinner, but then in the evening, I tend to catch up, and that's my uninterrupted thinking time. I get about an hour or two there every day; no two days are exactly the same.
Sometimes, I'm very product-focused, and we're doing... We had product business reviews and really looked at demos and technology. On other days, I'll be doing Zoom calls with customers, and then about once a month, and usually twice a month these days, I'm on the road, and I try to go see, call it half a dozen customers at their site because again, in operations you learn a lot by visiting and actually seeing their operations up close. So we'll do an exact meeting, but we'll often get a tour of the manufacturing facility or something that's unique to that business, which is one of the highlights for me.
Clint Betts
What are you reading, or what reading recommendations would you have for the audience?
Sanjit Biswas
Well, what I'm reading and what I recommend might be two different things. Not all books are amazing, but I love to read. It's the way I unwind at the end of the day. In terms of books that might be relevant for the audience, I've been reading a lot of basically biographies of the great technology leaders from, call it back in the day, like the 1970s, the 1980s, even the 1990s. Because the historical perspective gives you an idea of what worked and what didn't over the long term. So what cultural decisions did they make that built a great company that then ran another 25 years?
What may be product decisions did they make that seem bad at the moment but not so bad in retrospect, that sort of thing? So that's what I've been reading. Some of those greats would be Andy Grove and Bob Noyce from Intel if you want to go way back. Or Bill and Dave from Hewlett Packard. There's a wonderful book that Steve Jobs' widow published recently. It's available for anyone who has an Apple product. I think it's in the iBook reader, essentially about making products people want. So that's been an amazing book as well. So highly recommend those, just as case studies almost. Not so much advice from someone who's rolling it all up, but really just lived experiences.
Clint Betts
What do you think... I'm sure you've read or at least heard the conversation around Paul Graham's founder mode essay and being in founder mode as a founder and CEO. Did any of that resonate with you? Did you agree, disagree, neutral on it?
Sanjit Biswas
Yeah, it's certainly the talk of the town, at least for the last week or so, I think. So, if I step back, I do think founders have a really special and unique position. Someone, I can't remember who it was. Maybe it was Peter Thiel or Paul Graham or someone described, or it was... Maybe even Brian Chesky described the founder as the biological parent of a company. So you're with it through all the stages, and you care about every single stage. I think that's really special, really unique that sometimes managers who are hired in, they're only there for a brief window of time, and they know it that they won't be with it forever. I still keep track of the Meraki products. I've been out of that business for 12 years, but I still see the product on the ceiling when I'm at a Starbucks or at my kid's school.
You have a bit of pride and ownership over it, even if you're not technically an equity owner in that business. So, I think that gives you a really unique operating perspective. You deeply care, in other words, about the product, about the customers, about the people in the company, and I think that's what the founder mode essay really is about, is actually caring and then just blazing through things to get things done. Founders also have a really unique ability, I've seen, to go from operating a very strategic level, like 30,000 feet, down to three feet and then back up and down, just being able to shift back and forth. Not that many folks are able to do that. So I think if I look at how the Elon Musks and Mark Zuckerbergs operate, my understanding is Elon Musk is both operating at a very high level and coming up with strategies and how he's going to get to Mars, but also sitting on the factory floor, figuring out how to make the manufacturing process better. That's incredible and something that I think, again, founders are uniquely suited to.
Clint Betts
How are you thinking about artificial intelligence and its rise, and how are you implementing it in your company?
Sanjit Biswas
Yeah, it's one of the amazing tidal waves or forces, maybe one of the most incredible that I've seen in technology, at least in the last 20 years that I've been involved. We've been excited about it for a little bit of time now. So when we started the company, as I mentioned earlier, we pull in all of this data from operations, it can actually be an enormous, overwhelming amount of data. If you think about all the GPS data, camera data, and all the other machine data, it's too much to sift through. So we started investing in AI to basically help find insights in the data, and this is pre-Pandemic as a company was young, and that showed us that, wow, AI, even if it's in its form five, seven years ago, was very powerful for finding insights. We then plumbed those through to our customers.
We'd give them alerts if they were driving in risky ways or alerts if something was going to break, which would produce a lot of value to the customer, so that showed us the power of AI. More recently, this large language model revolution, some of the new GPU computing, and all of its capabilities have just been accelerating. I think now we can do things that are a hundred times, maybe a thousand times more powerful than what we could do when we started. So now we're thinking about how we infuse AI across the platform so it's not just in a product or two or a feature or two, but almost in everything that our customer interacts with. And then, even internally, how do we embrace AI to free up our time? So the stuff that could be handled by an AI that's filling something out gets done, and then the more creative work or more customer-facing work is where we spend our time.
Clint Betts
How are you thinking about it? And I know that this is the question everybody's trying to answer, so it's probably impossible to answer because who knows where it is in like five or ten years and whether we'll get to AGI or not, but how are you thinking about it and what are you preparing for? It will be drastically different and better in the next five to 10 years. So what should people be thinking about now if that's true?
Sanjit Biswas
Well, I think there's this huge debate about whether we can achieve AGI and exactly when I'd step back, and I just look at what we have already on the table and how incredibly useful it is. It reminds me a lot of the Internet revolution way back in the mid-1990s; even though the web browsers were basic in the mid-'90s, you could tell there was something there. The idea that you could now book an airline ticket without having to call a travel agent during business hours or just there are so many different useful things, such as email, etc. That's what I now see personally with all the new AIs that are available. And every year, it gets better and better.
Because I think most of us two Thanksgivings ago had that ChatGPT moment where you tried it out and you said, "Wow, this is really interesting." Now that the ChatGPT version seems really primitive. That's just been two years. So five years is going to be a wild guess in 10 years; who knows? But I do think it's safe to say these are the worst AIs we're going to see. It's only going to get better. So, if these AIs can produce value today, we should absolutely embrace them and get practice with using them. We're using it to help us write code, and that might be test code or security code or something like that. Eventually, it's going to help us write a lot of production code. Eventually, these agents will be able to build a lot more for us. So there's a lot there that I think we're all starting to wrap our heads around.
Clint Betts
What if you learned about leadership? You've been a CEO and a leader now for two companies and seeing them all the way through to present day. What have you learned about leadership and how has your leadership style changed, if it has?
Sanjit Biswas
I have to say I've learned a lot just by trial and error, by doing at the beginning. And first of all, I have to say I never imagined that I would be leading a public company. And so when we started Meraki, we were really grad students who wanted to see our products out in the world. We wanted to go see the technology have an impact. That's what drove us. All of this happened in service of that. Okay. The way to do that is by building products. The way to get products out in the world, at least for Meraki and Samsara, has been to build a sales team and get customers to use it because it needs to solve problems for them. So that's been an amazing learning journey for me to go from really being an engineer and technologist to, "Well, okay, how does this stuff get out there, and how do you do it in a sustainable way?" So, I learned a lot about business in that sense. And then, in order to do this, you need a team, and you need a pretty big team, it turns out.
So the leadership part came again as a byproduct of that, of, well, we do need dozens and then hundreds and now thousands of people hold us off and to keep doubling down on the stuff that's working. So I would say I've learned just through that trial and experience process and highly recommend it to folks who have an idea of a product they want to see happen in the world. As far as the actual leadership lessons, there's a ton. We could spend an hour talking through them, but for me, keeping that curiosity and that initial beginner's mind of, okay, how do we do this, and how are we going to figure this out? It makes the job really interesting. And I think that style of leadership resonates with a lot of people. They identify with it. We're all figuring this out as we go. Very few people, if any, I think are born out of the womb saying, "I'm a great engineering director," or, "I'm a great sales vice president." You figure this stuff out as you go.
Clint Betts
What are some products, apps, or even activities you do every day that keep you grounded and that you really enjoy and would recommend other people do? Do you have anything like that?
Sanjit Biswas
Maybe more so than what I do every day, what I don't do is I actually try to find blocks of time where I've got nothing scheduled. And in my role, if I'm not careful, a 20-minute meeting will land or a quick phone call or something like that. Personally, I like to just have a little bit of time to explore whatever I'm interested in that day, go on a walk, maybe I'll call my co-founder, or something like that. So that, flex time is what helps me stay sane and stay grounded. It's also a great way to pick your head up and think, okay, is this the most important thing that I can do for the company right now? Or is this the problem that needs solving?
Or is this just something that I was doing last quarter or last year that I'm just doing all over again, almost at a muscle memory? So, that time to reflect is something that I would like to have. And then, other than that, I do think a little bit of routine is good in the sense that it helps you budget your time. So a lot of what we think of at the CEO level or operational budgets where all the dollars are going. I don't think enough of us spend enough time thinking about where all that time is going. So, having free time is important, but am I spending enough time on the customer? Am I spending time with the finance teams, or am I spending time with engineering? Where should the time be budgeted?
Clint Betts
What do you think about this newly found responsibility that CEOs find themselves in and having to comment on things or make statements about things? you don't have to obviously, but if people are now looking to CEOs and business leaders to make a comment or to give them advice or for leadership on things that have nothing to do with building a company or their own company, but it almost seems like required at this point. How have you managed that?
Sanjit Biswas
I think it's also important sometimes to say, "I don't know." I know about our products, and I know about the customers we're serving, but I don't know about everything. So I think it's okay for CEOs to remind the world of where they do have expertise and a specific point of view to share and maybe where it's not appropriate or not relevant. And yeah, I have a lot of thoughts as an individual, but you should just consider me just like any other person. And so that's why when it comes to things like politics, we don't need to talk about that because it's not like you should be listening to my political opinion on something. And I think once you admit that, it actually opens up the conversation for people to feel, okay, I'm included regardless of my point of view or somebody else's point of view on this topic here actually to build products and get them out in the world. And that's our reason for existing.
Clint Betts
Finally, we end every interview the same way with the same question. And that is at CEO.com I. The chances one gives are just as important as the chances one takes. When you hear that, who gave you a chance to get you to where you are today?
Sanjit Biswas
Oh, so many people. If I think about going way back to grad school, just getting into an amazing graduate program, a number of people on whatever committee it was gave me a chance to do that from a stack of however many applicants that set the wheels in motion to start working with my co-founder and start building the technology, which then turned into these startups. But that was the beginning of a snowball. But along the way, we mentioned some of the venture capitalists. I think back to when we raised our series A for Meraki.
I must have been 24 years old, and they gave us, I think it was a $5 million series A check, I had never run a company before. We've been a bunch of grad students. So, the partnership with Doug gave us a chance. And it's the same thing back when we were raising money with Andreessen Horowitz, Marc jumped on board even though we had never worked in the world of physical operations. So, along the way... And those are just a few people. There are all these other people who've given us a chance with their careers, and they've invested time. So it is absolutely true that a lot of people have to come together and believe in you, and it's absolutely important to acknowledge that.
Clint Betts
Thank you so much for coming on, seriously. It's an honor to have you, and the company you've built is incredible. The entrepreneur and the leader you are is incredible. Thank you so much for spending some time with us.
Sanjit Biswas
Thank you, Clint.
Edited for readability.