Mentorflare: Fireside Chat with Matthew Prince, Cofounder & CEO of Cloudflare
Mentorflare is a virtual series of discussions with leaders at Cloudflare and guests in the technology industry. In this episode, Matthew Prince will talk about the many aspects of entrepreneurialism; how to develop a big idea, managing critique, creating a prototype, building a team and gathering outside support.
Hi everyone, I am Arielle Davis and I'm a rising second year MBA at the University of Chicago Booth School of Business with a concentration in entrepreneurship.
This summer I've had the pleasure of interning at Cloudflare and been exploring some of the things I'm really passionate about like tech and innovation and today we'll dive deeper into some of those topics on another live episode of Cloudflare TV.
This is part of our MentorFlare series which is where we host virtual discussions with leaders at Cloudflare to provide mentorship to students who are interested in learning more about Cloudflare or any future opportunities here at the company and just to stay connected with industry leaders.
So today I have the pleasure of hosting this fireside chat together with Matthew Prince.
He's the co-founder and CEO of Cloudflare.
In this episode Matthew and I will talk about the many aspects of entrepreneurship from developing a big idea, building a team, navigating failure and managing success.
So let's get started. I'll let Matthew introduce himself.
Awesome, well thanks for hosting and especially thanks for being a terrific intern at Cloudflare this summer.
So first of all you're going to ask me a bunch of questions but I want to ask you how is the summer and what surprised you the most?
About the summer, I think there was an abrupt shift to online right before the summer so I've been taking online classes and the biggest thing was that we missed this networking opportunity that is such a big part of the business school experience but I was really surprised by how many people have reached out to me, how many of my classmates have gone the extra mile to make sure that we're all staying connected, we're all staying engaged whether it be through the online classes or we'll set up small group discussions.
Even the wine club was able to navigate to the new virtual experience.
And so what about Cloudflare was not obvious before you did the internship that someone who might be wanting to do an internship with us in the future or come work for us in the future that as someone you know early in your career that stood out?
To me it was definitely the people and my manager really made sure that I had every opportunity to connect with all different aspects of Cloudflare and the people that worked in those business areas.
My manager was supportive of the fact that this is an internship and part of that is personal and professional growth and she made sure that at least every week I was connecting with new peers across the company, different employees, different colleagues from the product side to the technical side, people within marketing and sales and engineering and it gave me the opportunity to learn more about where I see myself and where I see my professional career going when I graduate business school next year.
Well that's great so it's been it's been terrific to have you an intern and I know that you know for you and everyone who's been on our internship team, we were learning how to do this virtually for the first time and so thanks for having patience and being a great part of it.
So excited for the next hour or so and happy.
What can I tell you about me or about Cloudflare or anything that you're interested in?
Yeah so we can kick this off. I mean for me and I know as a business student there's so many resources to support students who are interested in starting a new business venture.
I know here at Booth we have this annual competition where students compete in this shark tank style pitch of their business and this past year the university distributed almost a million dollars to student business plans so there's definitely a financial incentive to coming up with something new and creative but it's a lot easier said than done.
So my first question to you is when it comes to idea generation, where do you even begin?
How do you draw inspiration and identify if an idea could really become a viable business opportunity?
So I mean Booth has the business plan competition at Booth is incredible and I was actually a law student just across the midway and first heard about business plan competitions from other law students that you know this was in the late 90s that were entering that and I think Booth and MIT really have been the two business plan competitions that have been successful.
I mean you know I think that in terms of idea generation you know things come out of any number of different places and I think for me it's always been kind of scratching itches of things that I've been interested in in various ways.
So you know that Clevo wasn't the first company I started.
The first company I started was an anti-spam company but that really emerged because I was teaching a law school class up at a small law school in downtown Chicago called John Marshall and I got really fascinated with the question of jurisdiction online and the fact that you could send an email from Chicago and commit a crime in Saudi Arabia and that was this really kind of interesting hard problem and so I started writing a lot about it.
Writing and this was in the early 2000s what today would be called a blog but I don't think that Ev Williams had sort of christened that term yet and and you know the next thing I knew I was getting called into to talk with you know I got I got called by Senator Schumer's office in in D.C.
and they were helping write something that turned into what was called the Can-Spam Act which was the first anti -spam piece of legislation on a federal level.
I worked with a number of different state governments and it was and it really came from just finding a part of the world that I was interested in writing about it and then you know and then kind of putting yourself out there and and that that turned into you know an opportunity.
Un -spam the company actually didn't turn out to be a very good company.
It's still still around but it certainly wasn't as successful as as Cloudflare but in the process of starting that you know we hired a bunch of great engineers and had a really a really great little engineering team and we didn't have enough for them to do in the actual company and so I was always trying to brainstorm like various things for us to do and so we used Bayesian statistical analysis which was a technique that people were using to stop spam to predict the winners of the Sundance Film Festival in advance which was just sort of this silly hobby project on the side.
Got it written about you know Wired wrote a story about it and next thing you know VCs were calling us saying oh could you predict earthquakes or volcanoes and we were like no because you know the reason you could predict the winners of the Sundance Film Festival in advance is that the film like programmers know what movies are good and what movies are bad and when they write the descriptions they're a little bit like a spammer.
They're trying to convince you that every movie is great but some of them are only in the movie festival because they were the you know friend of the daughter of Robert Redford or whatever whereas others are you know really incredible movies and you can actually kind of pick out those tells in the same way but again it got us in this conversation with people and I remember at the time I'd actually flown out to meet one of the VCs and they had just invested in a guy named David Ulovich who had started a company called OpenDNS and he and a guy named John Roberts were getting it off the ground and as a result of that I stayed in touch with David, learned all about how DNS worked, learned all those things and John actually ended up much later being you know one of Cloudflare's first employees.
You know we did another thing where we tried to make it hard for Google to be able to track you and one way of doing that would be to make it difficult to sort of identify you as an individual.
We said the other way of doing it would be just to throw so much noise at what looked like your search terms that it would be difficult for them to separate signal from noise and so we basically built a browser plug-in that not only would in the background run random Google searches with your Google cookie but then it would allow you to automatically exchange your Google cookie with other people and so you know one moment I'd be searching for you know restaurants in my hometown and the next moment I'd be searching for things in Kansas City and the next moment I'd be searching for you know pictures of cute cats and it allowed you to kind of mix it up.
I think as a result we got to know a lot of people in the privacy space.
I became interested in that topic and that served us well at Cloudflare as well and then the last thing was Paul Graham who's who started Y Combinator but way before he did that he used to host a conference called the MIT Anti-Spam Conference and he invited me out to speak at it and the first year I spoke and I did some very legal kind of talk around how to write laws to throw spammers in jail and it went over really well and he invited me back to talk the second year and he's like just give the same talk and I was like Paul I don't think that'll work very well.
You know a technical audience 90% of it's going to be the same.
They don't want they don't really want to hear from the lawyer for the first in the first place.
They certainly don't want to hear the same talk they heard last year from the lawyer and so I went to a young engineer who was on our team was a guy named Lee Holloway and I said do you think we can build a system to track how spammers operate online how they steal email addresses and everything else and we thought about for a little bit and was like yeah actually I think we can.
I'll build the back end if you build the front end and you know I'm a good enough coder just to be dangerous and so we built something we call Project Honeypot and put it up online gathered about enough data that that I could give this sort of talk at the conference and we had all kinds of really cool stats like if how long between when a spammer harvests an email address and when they send the first spam or if a spammer is promoting you know fake university degrees are they also promoting like you know Viagra you know fake Viagra and things like that or how much cross -pollination is it or is there real specialization and so we we gave I gave a talk on that and it was sort of popular and then we kind of put Project Honeypot inside and didn't think about it again but over time it grew into this community of over a hundred thousand web administrators and they were constantly giving us feedback on you know gosh it'd be great if you didn't just track the bad guys but you actually stop them and I think that's where that's where Cloudflare came from at the at the end of the day was was that and so I think you know one of the things that's tough about you know being a student is that you're early in your career and you haven't had all these kind of experiences but I think if you can sort of take those things that you're interested in and write about them or talk about them or or just kind of put yourself out them and out on them so that you can continue to learn more I think opportunities and ideas often come from those those those various areas and and sometimes it's the things that you know it's it's the hobby project that you that you never expected was going to was going to turn into a business that the next day you wake up and and you know you're running a public company and and have 1500 employees so you named dropped a couple of people who were early members of the team and you're including me so I'm thinking about when you were trying to see how you would build your team what were your goals and what did you look for to really get people that you could trust to be just as excited and passionate about the idea of Cloudflare as you and still are so you know I mean so at Unspam we did everything wrong in terms of building the team um so you know I was too chicken uh to do it myself and I and I think it's it's really I know a handful of people who are single founders and it's possible but it's really hard and it's incredibly lonely and it's great to have somebody that you can at least bounce ideas off of and so in both Unspam and Cloudflare I had two other co -founders that I started from but but they came from very different places at Unspam I picked my two co-founders because I had had height lockers next to them in junior high school and we had been friends since junior high school and we were all some version of kind of um geeky policy wonk lawyer types and um and and and various various degrees on on that spectrum and um and we were best friends going into it and about two years in we weren't speaking to each other anymore and it was a disaster and the reason why it was a disaster is because there wasn't enough differentiation between our skill sets that it was clear who did what and so we were constantly fighting over what the right thing for us to do is because we had different ideas but it wasn't clear who the expert um was uh and and today you know we're back to being friends and and everything but it was really really really hard and when I you know we're fortunate enough now that a lot of entrepreneurs come to us for advice and one of the questions that we often get was you know how did you Michelle and Lee figure out how to divide up your time because I'm having a tough time with my my you know entrepreneur my you know fellow founders on how to figure that out and I you know I try and say encouraging things but if you're starting a business and you're trying to figure out how to split things up with your with your fellow founders um chances are you have the wrong founders um because it should be super clear um Lee was an employee at unspam and the reason that we that we hired Lee was again it complete this is not how to how to select um engineers but we had um for various reasons there was a professor that we needed to license some technology from and his requirement was that we had to hire one of his four students um in order to be able to license or one of the requirements and so we interviewed uh the four students and I remember we we were we had met at our our um our patent attorney's office and then we'd gone to a brew pub that was right next door and um you know and it was one of my co-founders at unspam and I were we're talking to the the four students plus the professor and the the the waiter came to the table and said would anyone like a beer and we were at a brew pub and every all all three of the four students um said no and Lee said yes and we were like well we'll take that guy and so we literally picked the one who who ordered a beer and that was how we how we chose it now that in that case we got incredibly lucky Lee turned out to be just an absolute technical genius um was was you know a good friend for a very long time um and when we were when we were starting Cloudflare um he had worked at unspam for a really long time and was getting recruited to go to google or facebook or other things and and I knew one of the real motivations for starting Cloudflare was you know Lee was one of those people that I just I was fortunate enough to have gotten to know and I always wanted him to be on my team and so when he called and said hey you know you've been really great to me but I don't feel like there are a lot of challenges here and I'm thinking of going to another company um I was like just give me some time and we'll we'll figure it out um and and it was clear that Lee was sort of the technical genius at at Cloudflare and and was the original architect for what we built and we couldn't have built built the company without him um I am I am good at being kind of the idea person I'm good at being the sort of um product person the person who's coming up with what the next the next thing is I'm good at certain aspects of marketing I am terrible at details I'm terrible at process and um and it and it took really struggling in the first company that I started to realize how bad I was at that and so I I was always looking for and if I look back through actually all of my time in in in college and graduate school and everything else I always had sort of a partner in crime who I was the person who would come up with the ideas and and and and and then this other person um would be the person who would really help make sure those ideas got got done and so um I I've been in business school um and in my in my first year of business school we the school I was at we took all of our first year classes together and as a result you got to know your your fellow classmates really well and there was one classmate um who who just didn't seem like the other business students I don't know what it's like at Booth but you know sometimes it's like you know professor asks a question every hand in the room goes up and people are trying to score points and you know and make the points and and this this person um she she would be like um was really trying to find the right answer right not just not just look smart in front of the professor and would say things like hey I really want to go back to that point that you know Bob just made because I think that was really interesting and and it was so different than um than anyone else who was there and so and that that was Michelle and and so I spent a lot of my time in business school just trying to convince Michelle that we should start a company together um because she had she was literally a six sigma black belt um which is the opposite of me and um and she kept saying listen you've got a lot of ideas but none of them are very good which actually I think was pretty fair and uh and and it was also in the middle of of uh you know the last real financial crisis and um but I kept I kept working on it and uh and finally um in the in the our last semester she said okay let's let's let's try and do this um but it started as a business plan competition uh entry as a student project um you know we ended up we ended up winning the business plan I don't think either of us totally thought it was going to going to turn into a into a company um but once we did that um you know it's it's it's really been off to the off to the races since then.
You've referenced a couple times about unspam and even if it didn't turn into the grand idea you had envisioned it seems like a lot of lessons learned came out of that and it brings me back to one of the questions that we got from the student audience which is how do you recognize when to pivot or when to abandon a project and in my words when is it time to swallow your pride and accept the sunk cost and move forward without losing the enthusiasm that you had before?
You know I think that's I think that's a super hard problem and I think that I don't I I don't know the answer and I think that um and I think it's something I'm uniquely bad at uh to be to be totally honest um and and and so so so there are two cases where it's easy um easy case number one is um it is is the extremely rare one which is which is the Cloudflare case which is you started out it all just worked and and and it's and it's and it's been wildly successful beyond beyond um beyond your wildest dreams that's that's the easy case but it's hard hard to plan for that one right the other easy case is actually the opposite of that which is you try you give and you give it a good honorable try but for whatever reason it just doesn't work so for instance the first uh company that I worked at after law school I was employee number one it was a startup it was a an online benefits brokerage um we raised eight million dollars it was called group works um it was an it was an interesting idea but it ended up being way before its time um we made some we made some mistakes uh and it failed and and we ran out of money and we shut the company down and um and that actually that's a that's a perfectly wonderful case as well because then you're not doing it the hard case is somewhere in between um and that's where unspam uh it still is actually in a lot of ways um it's where I think actually a lot of my uh you know fellow business school classmates um end up which is kind of in the slog where you're making enough money that like it doesn't you're not going to just completely fail but you're not growing very fast and it doesn't feel like there's anything that's going to change that trajectory or that course and what's tough about that as a founder is so much of your identity gets wrapped up in that experience that it's really difficult uh to walk away from and so you know I think if I look at the fellow entrepreneurs that came out of at a business school um you know obviously the ones that that have been you know really successful and it's been incredible to watch you know everything from you know thredUP to Rent the Runway to Tough Mudder to I mean all these companies that were they were student classmates and they were wildly successful and those those people obviously there's there's stuff that's stressful but but that's that's fun um the people who they tried something and it failed and then they've gone on to do something else they're actually in a pretty good place too it's the folks that are somewhere in between that where they're 10 years into a project you know it's generating a few million dollars a year in revenue it maybe breaks even they're having a whole bunch of employee turnover it's gotten hard for them to raise money because their growth rate isn't that they're trying new things all the time but nothing's making a difference getting out of that is a really really really tough problem and I think that you know it it almost always takes longer because people care about what they've built and they have loyalty to that and I and it's hard to figure out how you how you how you do the right thing for yourself in your career um without without getting too trapped in in in the sort of tar pit of of mediocrity which which a lot of a lot of startups unfortunately get stuck in it kind of reminds me of this venture capital class that we took and we discussed the various ways to evaluate a business idea both qualitative and quantitative and looking at the qualitative factors we interview the founders ceos to determine is this someone who's over invested in their solution like you said is they're so passionate about what they built and they're trapped in that tar pit um are they gonna maybe take feedback personally they're gonna be unwilling to hear suggestions of how to move forward from failure for example or is this someone who can take these blows in stride implement new feedback and be able to move forward so it's interesting to hear it from you yeah but you know you can be you can be that person that doesn't take feedback well and be massively successful um you can also be the person who takes a ton of feedback and learns a lot and unfortunately gets stuck in something where where where it's where it's really where it's really hard i a good friend of mine you know found uh found himself in in that situation and and and and it was and it was and it was really tough i know i have i have two founders um one of whom um you know after after a lot of time um finally just decided it's time to time to sell the company and and and move away and it never quite realized it and and i just and i just saw him and and he's just so it's just like the weight is off of his shoulders he's so much health healthier and happier um you know and i think the other one that's really tough is um you know when is it the time even if the business is is going well when is it the time for you as a founder to to step away and not not run that the business as well and have another another friend who just did that and and it's and it's been and it's i think it's been hard for him you know really because so much of your identity gets tied up in in these ventures that that you know even when you realize it's the right thing to do and you do it you know what you do the next day is um is is really tricky and that's that's true you step away it's also true the number of of um friends who have sold their businesses for you know life-changing amounts of of wealth um and then a year later are incredibly depressed is is it's really it's really it's really hard and it's it's it's really um it's really sad i there's there's a relatively well-known uh entrepreneur uh who i know who who did that who's in it he's just in a really dark place right now um because that um uh you know and and and so it's there's the difference between being the founder of a company and being an employee of the company is how much it becomes part of your identity and um and it's and and how you manage your own psyche through that um through either success or failure is is tricky i remember when um there's there's actually never in Cloudflare's history uh been someone who seriously tried to to um to acquire us which sometimes makes me feel like the ugly kid at the dance but um but but that's okay i mean again i don't think we ever built the company to be acquired um but there was a point in time where we thought maybe somebody might do that and and it was it was back in in sort of the 2015 time frame and i remember michelle came over to my apartment we opened a bottle of wine and sat on the floor and and i said you know one of the things i really worry about is i just see after people sell their companies that they kind of lose purpose and they lose a big part of themselves and their in their own identity and and i said i i don't know what we do next if if we sold this and she um and she looked at me and she was like well that's obvious we'd start another one which is both the nicest thing that anyone has ever said to me and also at some level completely crazy because it's you know you have to get so fortunate to have captured lightning in the bottle um for something that that that has been as successful as we've as we've been so far um and uh and and i and i think it's it's a lot of that a lot of that comes down to to to just to luck and having been at the right time and and assembled the right people and it's and it's hard to do that twice and one of our intern round tables with you something you talked about that stood out to me was all the things that didn't happen that led you to your success today Cloudflare success today things like not getting into every business school or michelle not getting the return offer at google or like you just mentioned not not getting acquired by another company could you talk a little bit more about how things might not always go to go as planned but it doesn't mean that it's you know the end of the road yeah i mean i think that um you know i i think that uh the so so it's a it's a little hard for me to answer because i i do feel like we've been you know very fortunate and and unlike a lot of other startups you know if you go back and our our our business plan is still on file at the at the at the business schools um library if you go back and you read it that you know the very first sentence is Cloudflare is a service that makes the Internet faster more secure and more reliable and and if you look at like our website today it says something that's basically you know the the same thing or if you read read rs1 it's it's basically the same thing so we've we've kind of been on a on a on a fairly you know straightforward path but there are an amazing number of of setbacks um that happen you know throughout that path i mean i i remember you know the first we we had a we you know especially around hiring early on the number of disappointments that you have because you know when you're just an idea on a piece of paper and you've raised raised a little bit of money and you're trying to attract your first engineers or whatever um it is so incredibly hard uh to to do that and you know the the number of people who you know we thought who had signed offers from and at the last minute said you know honestly i'm just going to stick with my you know big employer and not and not take a risk and and i think that that that that's um you know that's a that's a totally rational decision um for for people to make um which which makes me then you know all the more thankful for the first you know 20 employees at at at Cloudflare um and you know you have to be you have to be you don't have to be completely crazy to start a company um the amount that you get to learn in that process um and you know the the financial benefits if it's if it's successful or enough that being a founder is is pretty rational but being an early employee at a startup is so hard and it's it's so unlikely that that that it's going to be successful that you have to be a little bit crazy and a little bit irrational and there's a there's a small handful of people out there um that just love that experience and um and you know we we still have a handful of them who are at Cloudflare but a lot of those first 20 employees went from Cloudflare and when we started to get to be you know big and bureaucratic and you know all the things that that companies become inevitably over time um that they went on to another startup and another startup another start and they kind of bounce between those various things and and i think that oftentimes those those people end up being really kind of the unsung heroes of the startup economy because because they're they're taking these enormous risks uh and and helping build out and figure out all those early early problems and early challenges and uh and what was fun was when we went when we went public we actually got um all eight of the original Cloudflare team we flew them out to new york and they were all there with us and and i think only of that you know michelle and i are still at the company and and again i'm sure we were out but everyone else has gone on to do other things and it's it's been amazing to see what they do um but but boy that that hiring in the first in the first while is so incredibly hard and it's what you spend all of your time doing and there's no shortcut and um and and and and the company would have been totally different if you know a handful of people had said yes to offers then then they're not and who knows we've been more or less successful but it's the i i feel like we owe an enormous debt to those those first people who are who are employees something that surprised me pleasantly surprised me about Cloudflare was seeing how involved the ceo the founders and the senior executives are in hiring people and making sure that you're really getting people with just that right amount of of crazy as you said um one of my favorite books is ben horowitz is the hard thing about hard things and there's a line where he says take care of the people the products and the profits in that world taking care of the people is most difficult of the three by far and if you don't do it the other two don't matter so i'm curious to hear your take on that what do you do to take care of the people at Cloudflare to make sure that you're hiring the best and also that they're that you're able to retain the best as well yeah i i like that book too although it's sort of i like the first quarter of it and then it gets a little bit preachy um at some point which is which is which is i mean bet but ben's a smart guy um the you know i there there's a uh another a friend who's an entrepreneur um and i and i've stolen her line but she says that you know the job of the founder ceo is to fire themselves from every other job and um you know when we first started i was i was our lead front end engineer i was our head of customer support i was our head of sales i was our head of communications and and some aspects of marketing i was um i i i was i i you know i was i was i was wearing many many many hats and today you know we have hired people who are better by at least an order if not orders of magnitude than i am at all of those those different jobs and and and my philosophy on hiring has always been hire great people and then get out of their way and let them do their do their job um and and i and i do it i i certainly do a better job of that at cloudflow than i did at unspam um and and it's and it's amazing and i feel like i get to learn from a lot of the great people that we've hired um across across the organization which then you know begs the question of you know what is the role of the ceo at a company and and you know i spent i spent a bunch of time just talking to other ceos that were you know several steps ahead of me and and the the one that uh and and asking them the question like how do you split up your time and and i and i remember talking to jamie diamond um ceo of jp morgan and i said um you know ask asking that question he said uh he said i do about a third of my time on um on what i'll call internal affairs which is you know one-on-ones with my direct reports helping sort of set the overall vision of the company kind of speaking at all hands events those sorts of things he said i do about a third of my time on external affairs talking to customers talking to industry analysts talking to media speaking at conferences talking to investors and then i spent about a third of my time on uh on on recruiting and retention and and that struck me as about right um and kind of the right steady state for uh this and and i and i think that recruiting recruiting sucks and it's hard and it and it can be exhausting and you know we have a we have a policy that every single person that we hire talks to one of the four most senior people on on our on our team um and and i and i take about a quarter of of of those calls and it's and it's a lot of time and um and you know there's a temptation to only talk to the most senior people that you're hiring but i actually think it's really important to talk to everyone and very rarely am i trying to figure out you know should we hire this person or not almost always we've made a determination to hire them and so there are really three purposes um to to the calls um you know and and the first two are the the the last important one so the the first is every once in a while you know you'll get the scooby sense that something is off with someone and it's sort of a final check um and and i i really never veto um anyone anymore but sometimes i'll be like hey this person said something a little bit odd maybe we should just poke at it a little bit more that that is by far the least important um the the other the second purpose is that you know we have to compete for talent with companies that are a lot larger and more resourced than we are so facebook and google and microsoft and others and um you know one of the assets that we have that is harder for them is mark and satya and and sundar aren't calling you know junior customer support people and so if it's just a marketing exercise that can be that can be important and and we found that that helps us um you know get the high offer acceptance rates um that that we do which are which are which are really we're really proud of that also is not the primary reason the the primary reason it's 90 of the reason i dedicate time to it is that if you look out at where when companies get to our stage where they screw up um it's usually a self-inflicted wound it's someone is is harassing somebody else internally or somebody is committing fraud or somebody is um you know covering up a good idea and not and it's not spreading across the organization and what's difficult is that inherently when you get to 1500 people there is a certain level of bureaucracy and the nature of bureaucracies are that they cover up the problems and so the question is what's the hack to make it so that if there's a problem that it gets raised um to me or to michelle or someone who's a senior leader on our team and it's pretty spooky if you are a new employee and you see that something is going wrong and you're like i should call the ceo and let him know if the very first phone call you have to make to me is by the way something you know bobby is harassing suzy um that's a really really really scary phone call to make and so i try in those in those conversations um to say listen first of all i do them all from my cell phone so that everyone who starts at Cloudflare got my cell phone number uh and i say on almost all those calls um this is you know hopefully the first of many conversations that we'll have and if you ever see a place where we're not living up to you know what you would think i would want the company to be i hope you'll let me know because because i because that's the key for us fixing it and you know if if i can make the chances of us committing one of those unforced errors drop by five percent um by being accessible in that way from from the very you know from even from day zero of a company of a employee being at the company um i mean that's probably worth a billion dollars uh to us and i can't think of any any way that i could spend a third of my time that would have a higher return on it uh than that and so you know i there are only so many hours in a day and so it's it's hard to keep doing that forever as as the team keeps getting bigger um but but i'd imagine it will always be at least a third of my time and and i hope i will continue to talk to junior customer support reps or or you know brand new um members of our sales team or or or you know engineers that are straight out of college um because those are the people who who are on the front lines and see those places where we're not we're not living up to to what we should be it's interesting that you're it sounds like you're constantly drawing feedback from your employees from leaders at other companies can you talk a little bit more about making sure you're always incorporating feedback and going out and and seeing external opinions on the work that you're doing in the direction of the company and then also are there times when you disagree with feedback and what motivates you to to continue forward no i mean i i disagree with feedback all the time uh and but but i think again this goes back to you know picking who your founding team is uh and then hiring people who are experts in various areas is is is super important um and so like if i look back you know michelle and i disagree all the time um but there are certain things that she's the expert in and and i defer to her and there's certain things i'm the expert in and she defers to me and and there's sort of a division of labor um around that and and i think it's really important to sort of disagree and commit um you get it you get a handful of kind of ceo vetoes uh that that happen across the organization and and and and sometimes you don't even know and this is and this is again i think i think uh it's it's not good when it comes to this but sometimes there are things that that you see that you really care about um i mean and the silliest example of this by far um was we had a uh a program uh that that i'd helped create that was uh about election security and um and and i and i named it and we called it the athenian project and um and we had this other thing that's called project galileo and so our marketing team thought wow we should align these things so they have the same structure and how they're set up and so we shouldn't call it the athenian project we should call it project athenian and and i had a i mean emotional reaction it was like changing the name of my child without getting my permission now there's no way the marketing team could have known that ahead of time and and and so no no fault no fault on on their on their side um but but that was one of those things where i was just like no i mean use one of my ceo vetoes and and switch it back even though it was a total pain in the ass for the team and and had to redo all kinds of collateral and things but but i cared about it a lot um you can't do that all the time right and and and i think that where where i get in trouble when i get in trouble um and i think where any anyone who's you know ceo and especially a founder ceo gets in trouble is if you're not trusting your team and if and if you're if you're picking too many uh of those of those fights so so you know that's that the other thing that's hard is um and it's part of why if you start a company having co-founders and having co -founders that you know really you treat as equal regardless of how you set the org structure up that you really think of as equals and you treat as equals um that's um that's super important because it gets you no matter how much you try to be accessible no matter how much you do phone calls from your your cell phone with every employee that starts no matter how much you try to be a happy-go-lucky um ceo and and say gosh i really want to hear feedback you get very isolated by by the organization over time and fewer and fewer people give you uh real feedback and so having michelle as somebody who will you know call my bs is uh is a real asset and um and i and i think you know something that's super important you've been working with michelle and some of the early employees for more than a decade now when you think back on who you were when you graduated business school and you this idea was still new when you were building the team how is your perspective on the industry and even the world changed in that past decade and beyond you know it's interesting and it's um there are uh there are investors that um that that passed on Cloudflare um early on and who i'm who i've remained or who have become actually friends with um subsequently and and some of the feedback that they that they gave was you guys seemed like you were you you seemed almost you i mean this is not the word they use but but i think it probably is the word that they should have used but you seemed almost too arrogant um early on and it's and it's interesting you know your role and i go back and you can watch our original pitch of of Cloudflare which is there's a video that's out there um and keith rabois who's a you know fairly famous investor over time and and um a handful of other people were judges at at tech crunch disrupt where we where i launched and at some point somebody asked the question of like you know what's what's your goal at Cloudflare and again we were eight people and and and i said something like our goal is to run the Internet and just like mic drop like a naked end of sentence you know and that was it and that was such a i mean again it was audacious but it was also probably you know a little a little bit arrogant but i think you you you have to have a little bit of that going in um and and there's this transition one of our early investors again named ray rothrock said that early on a startup has to sort of exhibit the puffer fish strategy where puffer fish are these teeny little fish but they puff themselves up so they look a lot bigger than they are um and and that's and and we and we did that and and you know we leaned in to a lot of things to sort of almost seem bigger than we were and and the interesting transition is to transition from that to today where actually we've got to kind of we've got it we're we are now a relatively large company and we do see a huge percentage of the Internet and and it's it's actually um important for us to be incredibly humble in that privileged position that we're in and that transition it's not like that flips as a switch but there's a transition where you wake up and you say you know we've gone from sort of dreaming that someday we might be this critical piece of infrastructure and pretending like we already are to one day waking up and realizing oh my gosh we we are that thing and I think that you know one of the things that is hard to see from inside companies and you watch especially in tech this happen because scale um and and influence and power and wealth can come so quickly in the in in tech companies when they when they take off that oftentimes you that you don't see this internally I remember I was interviewing um a guy who was part of the self-driving car um initiative at Uber at some point and and he he said yeah we we decided one day that we were just going to you know without telling the city without telling anyone we were just going to launch self-driving cars on the streets of Pittsburgh and like if you're a scrappy startup like those are the sorts of kind of growth hacky things that make sense but at some point like when you're putting you know real people's lives or assets or other things at stake you transition from being a cute little startup to being you know something which is which is different and I think a lot of times a lot of where the tech industry feels out of touch with the rest of the world is when they when when they don't make that transition Google still called itself a startup until it bought Motorola which is insane right um and and and I think that one of the things that Michelle has been really good I I still think of Cloudflare as a startup and Michelle's like we're not a startup anymore like we're a real company we've got you know 17 offices around the world huge percentage of the Internet relies on us and we have to start to take responsibility for that and I think that that's um and I think that that guidance has actually given us um has helped us mature and and and I hope will serve us very well over the long term when Cloudflare was a startup you were going through this whole business creation during an interesting economic period and it's similar to what we're facing now so a couple of our student audience members were curious to know that as someone who started a business during an economic downturn is there anything that you would recommend to new startups right now and how how do we take into stride all these rapid changes that are happening to the way that we work yeah it was I mean you know I I had I'd been I'd been super fortunate um right as I was starting law school um I I you know I I'd been I'd been an Apple user for all my life and um and I heard that this this guy Steve Jobs was coming back to run Apple and and I decided to buy you know some some Apple shares which were which were not not very expensive at the time and um and and and and it turned out that Apple did really well over the over the next uh the next a while and that's how I paid for um law school and that's how I paid kind of to to to live for the next period of time because I was I was I was definitely um underemployed and you know the startup I'd gone to had failed and a bunch of other things and that's and that's how I paid for business school um but the way that I paid for is I hadn't sold the stock I just borrowed against the stock and so when uh and so I was on margin um which the business students in the audience will will understand and and that worked great as long as the stock is going up but when in 2008 uh the market collapsed um all of a sudden I had to pay back all of those loans and it felt and and that sucked but the thing that also really sucked was while I felt like that was a huge loss um the IRS saw that as still a huge gain and so on top of you know paying that all back I all of a sudden owed a bunch of taxes and I was I was completely and totally insolvent um in in 2009 had to I had to borrow money from my mother um to pay my tax bill which was which was both incredibly embarrassing as as someone who was in in in his mid-30s at the time um and and as someone who had actually felt you know like I was doing pretty well up until then and um and it was really scary um at the same time you know Michelle had worked at Google over the summer of 2008 and that usually if you work at Google and you do a good job like Google extends you an offer to come you know join you have some safety net and feeling and you may go work somewhere else but at least you know you've got kind of that offer in your pocket and it was the one year Google extended no offers um to to anyone else and so I was I was terrified because I had not done I had I we were talking yesterday and and you said like you know the standard business school thing is you'll learn how to interview as a consultant or an investment banker I hadn't done any of that I didn't have any job offers that were out there and and all of a sudden I had this and I had no I had no idea how I was gonna you know pay rent and um and Michelle you know um I I think had the economy been going better she'd probably be a Google employee to this to this day um and so I think sometimes you know the there's nothing quite like you know having to figure out how to pay your rent that focuses your mind on okay this has got to really work and um and I think that that sometimes actually the the the best companies get born out of really tough circumstances and if you look at if you look at our graduating class of 2009 I think there are four billion dollar startups that came out of out of that one small class and and my hunch and and what we're going through today um I mean it's gonna make 2008-2009 look like a speed bump um and so you know I think that there will be I think a lot of the kind of frivolousness of of startup companies and the and the people who are starting companies just because they think it will you know make them look cool um I think a lot of that goes away during tough times and I think people focus on how do I solve real problems I think companies get a lot more frugal so there will be a lot fewer free lunches and massage rooms and and and you know fancy gyms and there will be a lot more um you know solve real problems and and my hunch is that you know you will see many um you know incredible uh you know what turned into multi-billion dollar um companies born out of the experience that we're all going through right now and and um and I think that's I think that's exciting.
Yeah I agree. Thank you so much Matthew for sharing your experiences and your story your journey both the highs and the lows um I wanted to ask you one more question in the final five minutes um just to end on an optimistic happy note or what are some of your predictions about the future what do you think is going what do we have to be excited about and tell me what stock to buy because apparently Apple was a really good uh decision.
I have no earthly idea what stock to buy um that was that was that was that was very that sometimes it's better to be lucky than good um the um you know it's so we uh yeah I to be totally honest it's it's tough right this particular moment um to feel super optimistic because there are fires all over San Francisco I mean it's incredibly smoky outside here um you know I think that that um you've got a lot of the stimulus programs um in the United States and otherwise that are that are ending uh this week and there are going to be a huge number of people who are out of out of jobs um and and the blow to the economy is is going to be I think really significant and and massive um I think that um I think I think I think even if there is a vaccine um and and there's there's some pretty encouraging data that in that in the um you know kind of December November December time frame of this year you'll start to see the first vaccines um effective and and and based on you know a a bunch of data that it of the sort of six candidates you know the first ones that come out may not be the best but but there will probably be some that will have kind of a 90 efficacy rate but just get the the logistics of getting that distributed um and the challenge is just trust um you know I I was I was talking with um some really smart people the other day and it was like if if a brand new vaccine is out and and we're all pro vaccine people but would you be the would you be the first one in line to take it and and it's not sure that the answer is that that you would you'd kind of want someone else to do it but if that if that's a problem then it becomes a problem um across across the world I think that's gonna those are all those are all real challenges and so I think we're going to um be in a in a tough spot for a while and and that's and that's hard on on a lot of people and we we should acknowledge that I think the thing that's you know the thing that surprised me is so we made the call to go um fully remote on March 12th and we had traditionally been a very work from office culture and Michelle and I were terrified when we did it we thought oh my gosh we're going to miss the quarter everything's going to slow down productivity is going to stop and we understand viral growth so we understand that epidemics are bad um and I think the surprise has been that you know we've never been more productive as a company than than than we are right now and and everyone is having different experiences and we're trying to be incredibly understanding that if you've got young kids at home to that that's harder than if you're you know if you're a single engineer who's like oh my gosh I have all this free time to code right because I don't have to commute um but but I think that what's been amazing is that that's worked a lot better um than anything before and I think that you know the the other piece is you know we've always believed that the most diverse teams end up winning um and so one of the challenges has been that in the past if if you wanted to work at Cloudflare you had to move to San Francisco or London or Singapore you know somewhere and and that makes it harder for people especially who are first generation college graduates or otherwise who might be supporting their families to move away and I think that this has been this grand experiment for us and the rest of the world that has shown that you can have more flexible work environments still be productive and I think that maybe the opportunity from that is that we will be able to attract a more diverse team more diverse teams are more likely to come up with creative uh new solutions and and maybe and maybe while the next two years are I think going to be really tough for the world uh you know I'm I'm hopeful that then the next 20 after that um maybe we'll have learned a new skill set that that makes us a better world overall.
Thank you Matthew.
Absolutely. Thank you so much for doing this and uh and thanks for being an intern at at Cloudflare and I hope as you're thinking about what the next steps there are in your career that you'll you'll consider us.
Definitely. Thank you.