20VC Evernote & mmhmm Founder Phil Libin on Why We are Beginning a MultiTrillion Dollar Restructuring of the World, Why Shortcuts are the Biggest Mistakes Startups Make & The Future of Video and The Unbundling of Zoom

Summary Notes


Harry Sebbings hosts Phil Libin on the 20 Minutes VC podcast to discuss Phil's journey from founding Evernote to creating his latest venture, Mmhmm, an app designed to enhance remote presentations. Phil, who has successfully raised over $30 million from notable investors like Sequoia and Kevin Systrom, shares insights into the importance of building a talented team, the pitfalls of startups taking shortcuts, and the discipline required in managing substantial funding. He also reflects on the transformative power of video communication in reshaping industries post-pandemic and the potential unbundling of platforms like Zoom. Phil emphasizes the need for products to have a meaningful impact on people's lives, and how he envisions Mmhmm making remote interactions more engaging and fun in the future.

Summary Notes

Introduction to the Podcast Episode

  • Harry Sebbings introduces the episode of "20 minutes VC."
  • Phil Libin is welcomed back to the show.
  • Phil is the founder and CEO of M, an app for enhancing remote presentations.
  • Phil has a successful history with Evernote and General Catalyst.
  • Thanks are given to previous guests Bizstone and Julia Hartz for their question suggestions.

Welcome back. This is the 20 minutes VC with me, Harry Sebbings and I'm so excited. I'm so thrilled to welcome Phil Libin back to the hot seat today.

This quote serves as an introduction to the episode and the guest, Phil Libin, highlighting the excitement around his return to the show.

Phil Libin's Background and Achievements

  • Phil Libin has raised over $30 million for M from notable investors.
  • He was a managing director at General Catalyst.
  • Phil is known for founding Evernote and leading it as CEO for eight years.

Now Phil is the founder and CEO at M, the app that allows you to level up your remote presentations, making high quality video content in minutes. Phil has raised over $30 million for the company from an incredible array of investors.

This quote outlines Phil Libin's current role and his success in raising significant funding for his company, M.

Startup and Investment Management Tools

  • Harry Sebbings discusses the use of AngelList for managing investments.
  • Remote is highlighted as a global employment solution for companies.
  • Ramp is introduced as a spend management platform and corporate card.

I just love using angel list fund admin platform to manage my investments with 20 vc. Remote handles payroll benefits, taxes and compliance to help companies of all sizes to pay and manage full time and contract workers all over the world. Ramp is the only spend management platform and corporate card that can really automate your accounting and lower your bills in under 15 minutes.

This quote provides insight into the tools and platforms Harry Sebbings uses for investment management and recommends for global business operations and spend management.

Phil Libin's Journey to Startups

  • Phil Libin has started five companies, beginning in 1997.
  • He does not identify primarily as an entrepreneur; starting companies seems to happen organically for him.

Well, this is my fifth startup and yeah, I guess I started my first company back in 1997, one of the first dot companies. I don't self identify as an entrepreneur. It just kind of keeps happening for some reason.

Phil Libin describes his entrepreneurial journey, emphasizing that he has not actively pursued entrepreneurship but has naturally gravitated towards starting companies.

The Inception of M

  • M was founded during the pandemic lockdown out of a desire to make video interactions less dreary.
  • The company started informally with experimentation on Zoom and evolved into a product.

We were all just sitting around living on video and finding that to be pretty dreary. And I was just goofing around. I mean, started as a joke, just as a way to make our life on video a little bit less boring.

Phil Libin explains how the idea for M was conceived as a way to improve the monotony of video communication during the pandemic.

Key Factors to Success in Previous Companies

  • Team and people are the most critical factors for success.
  • Many of the early Evernote team members are still working together.

A lot of what worked really well at Evernote was a lot of the people, a lot of the early Evernote crew were still together for and for all turtles. It comes down to the team and the people.

Phil Libin attributes the success of his previous ventures, including Evernote, to the strength of his team and the continuity of working with talented individuals.

Retaining a Strong Team

  • Phil Libin focuses on maintaining relationships with talented colleagues.
  • Assembling a team is about finding the best people to work with, not just friends or past associates.

I've just tried really hard to stick around with all these people, right. I don't really see myself as the central convener of it. It's kind of the opposite. I'm just trying to make sure I still get to work with as many really talented people as possible.

Phil Libin discusses his approach to retaining a strong team, emphasizing the importance of working with talented individuals rather than just assembling a team based on personal connections.

Transitioning from Informal Gatherings to Structured Organizations

  • Companies need to implement structure quickly, especially regarding hiring.
  • Startups often take shortcuts by hiring friends, which can be detrimental.
  • All Turtles, the product studio behind M, takes team building seriously and uses structured hiring processes.

Figuring out how to be more disciplined around hiring around retention is really a day one thing. So we've tried to be, this is one of the founding principles of behind all turtles, behind the product studio that came out of is that we take the team building very seriously.

Phil Libin emphasizes the importance of disciplined hiring and team building from the outset, rather than relying on informal networks and friendships.

Expanding Talent Networks

  • All Turtles spends money on recruiters to find candidates outside their immediate network.
  • Money is the primary tool for businesses to acquire services, including recruitment.

We spend money on recruiters, and we specifically tell recruiters that we are paying you money to send us people that are outside of our comfort zones and outside of our networks.

Phil Libin explains that to expand their talent pool, All Turtles invests in recruiters to bring in diverse candidates beyond their existing network.

The Problem with Shortcuts in Startups

  • Startups are incentivized to take shortcuts to succeed quickly or fail fast.
  • The VC model encourages fast growth and risk-taking, which can lead to negative consequences.

All of the incentives are lined up for deploy money as much as you can. Sometimes once your funds get bigger and bigger and deploy them into things that are either going to fail quickly, because the last thing a VC wants is to hang around a perpetually stalled startup, or succeed massively quickly.

Phil Libin criticizes the startup culture of taking shortcuts, driven by the venture capital model that prioritizes rapid growth and high-risk ventures.

Spinning Out M as a Separate Company

  • The model of All Turtles allows for products to reach their potential in the most suitable form, whether within All Turtles or as standalone companies.
  • M was spun out as a separate company due to its potential and the need for external capital.

The idea is we want to make products that are worthwhile, that are kind of good for the world, that if they succeed, people are happier and healthier, and we want to do it with as little nonsense as possible.

Phil Libin describes the rationale behind spinning out M as a separate entity, aligning with All Turtles' mission to create impactful products with minimal unnecessary complications.

Phil Libin's Management and Leadership Style

  • Phil Libin's favorite aspect of being a manager is seeing his team excel.
  • He enjoys when the team achieves great things without his direct involvement.

My favorite thing in the world about being a manager, the best thing ever, the thing that makes me the happiest as a manager, is when I see something that the team has done and it's amazingly good. And I didn't know anything about it.

Phil Libin shares his management style, which is centered on the joy of witnessing his team's independent successes, indicating a leadership style that empowers team autonomy.

Empowerment and Delegation

  • Harry Sebbings discusses the joy of witnessing his team achieve great things independently.
  • Phil Libin stresses the importance of hiring people who are better at their jobs than you would be.
  • The key to delegation is having confidence in your team's superior abilities.

"The team does something that is amazingly great and you had nothing to do with it. You barely even knew that anyone was working on it."

This quote highlights the rewarding experience of a CEO when the team independently accomplishes something remarkable, suggesting a successful delegation.

"Only hire people. Only surround yourself with people that are ridiculously better than you or that are superior to you in their job."

Phil Libin advises hiring people who excel in their roles, which allows for confident delegation and reduces the temptation to micromanage.

Overcoming the Challenge of Delegation

  • Harry admits he finds it hard to delegate because he feels he knows his company best.
  • Phil counters by emphasizing the need to hire competent individuals to overcome this challenge.

"You just said it. I can help you with this. This is founder therapy, man."

Phil identifies Harry's difficulty with delegation as a common issue for founders and positions himself as capable of providing guidance.

"It all just comes down to knowing that the job of the CEO is to kind of be the worst person in the company at any given function, or else you're doing it wrong."

Phil explains that a CEO should not be the best at any operational function within the company to foster effective delegation.

Professionalization vs. Relationship-Based Business

  • Harry questions the feasibility of delegation in a business heavily reliant on personal relationships.
  • Phil denounces the idea that a business's success is solely based on relationships, advocating for professionalism and hiring competent people.

"A sign of a non serious business is when people in it say, this is a relationship business."

Phil challenges the notion that personal relationships are the sole driver of business success, suggesting that it may be an excuse for a lack of professionalism.

"What would Netflix do? What would a hyper professionalized and industrialized version of your company look like?"

Phil encourages thinking about how to scale and professionalize a business, using Netflix as an example of a company that succeeded without relying on the 'relationship business' model.

Venture Capital as a Relationship Business

  • Harry references the common belief in venture capital that it's all about relationships.
  • Phil shares his mental model of not being overly influenced by his own thoughts, which he humorously refers to as his "doofusy roommate."

"I've got this model, this mental model that served me pretty well, which is, I call it my brain is not my friend."

Phil introduces his personal strategy for challenging his own biases and assumptions, which involves treating his thoughts as if they were from an unreliable source.

Self-Awareness and Leadership

  • Harry inquires about Phil's self-awareness and its development over time.
  • Phil modestly suggests he may only appear self-aware, indicating that true self-awareness might come later.

"I probably still don't really have it. I think maybe I'm just going through a phase where I'm good at faking it."

Phil responds to Harry's compliment about his self-awareness with humility, suggesting that he may not be as self-aware as he seems.

Impact of VC Experience on Leadership

  • Phil reflects on his time as a VC and how it provided him with a different perspective on the mistakes he made as a CEO.
  • He realized that his approach to evaluating pitches was flawed because he focused on what he would do rather than what the founders would do.

"It was like two years of self reflection that was, I think, very important."

Phil acknowledges the value of his VC experience in providing him with insight and self-reflection, which he believes has made him a better founder and CEO.

Weight of Words in Leadership

  • Phil advises that team members should focus on doing the right thing rather than strictly following instructions.
  • He emphasizes the importance of outcomes over intentions and encourages team members to challenge his ideas if it leads to better results.

"It's not your job to do what I say, it's your job to do the right thing."

Phil clearly states his leadership philosophy, which prioritizes the correct action over blind obedience to his directives.

"What's important is what's going to be the end result, not what our intentions are."

Phil highlights the significance of outcomes in business, suggesting that good intentions are not as valuable as successful results.

Encouraging Internal Debate and Dissent

  • Phil Libin discusses the difficulty of promoting open debate and dissent within a company, especially when leaders may unintentionally suppress diverse perspectives.
  • He notes that remote work has revealed the value of quieter, more introverted team members who may not speak up in traditional meetings but offer valuable insights in a more digital, asynchronous environment.
  • Libin acknowledges his own past tendencies to dominate discussions and the importance of realizing and correcting such behavior.

"It's tough. And I think actually one of the things that I've realized is better in the current world, we're mostly working remote, which I kind of had a glimpse of before, but I don't think I fully appreciate it."

Phil Libin reflects on the positive aspects of remote work, specifically how it can help more reserved team members contribute more effectively.

"I think all of us do this to some extent. I think I was pretty bad at shutting those people out just because I could dominate a meeting, a discussion."

Libin admits his role in previously stifling quieter voices during in-person meetings and the change in dynamics with remote work.

Self-Review and Reflection

  • Phil Libin talks about the lack of a formalized review process at his company and his personal commitment to self-improvement through reading and reflection.
  • He emphasizes the importance of learning from mistakes and continuously striving to improve, even when formal review processes are not in place.

"Yeah, we don't have a formalized review process yet. We should."

Libin acknowledges the absence of a structured review process and the need to establish one.

"I think, for my own self, I think I take plenty of time in reading and reflection and just kind of collecting my thoughts and realizing that, again, my thoughts aren't not any more special than anyone else's thoughts."

Libin shares his personal approach to self-review, highlighting the importance of humility and continuous learning.

Consumer vs. Business Application Usage

  • Phil Libin challenges the common practice of focusing on differences between consumer and business applications, suggesting that understanding similarities can be more enlightening.
  • He argues that businesses are made of people who make decisions similarly to individuals, and that recognizing the commonalities can lead to deeper insights.

"How is b two b, different from b to c? ... But I actually think very often you learn more by looking at the similarities and understanding why are they the same."

Libin encourages a reevaluation of the traditional approach to analyzing business models by considering their similarities rather than just their differences.

"So much of our analytics, stats, metrics, what people teach in business school and science is really about the taxonomy of how do you carve things out?"

Libin critiques the conventional emphasis on categorization in business and science, suggesting a more holistic approach.

The Unbundling of Zoom

  • Phil Libin discusses the uncertainty surrounding the future of video communication platforms like Zoom, comparing the current technological shift to the early days of the internet.
  • He speculates on the potential for specialized services to emerge, catering to different niches and verticals, but acknowledges that the landscape is still evolving and uncertain.

"So I don't think we know, because I think we are right now in the beginning of a multitrillion dollar restructuring of the world."

Libin expresses the magnitude of the changes in the video communication sector and the difficulty in predicting its future.

"Is zoom a platform or an application? ... We just don't know yet."

Libin highlights the current ambiguity regarding the categorization and future trajectory of Zoom and similar services.

"It's going to be a bigger transformation, as the.com transformation was, except it's not going to take ten years, it's going to take like two years, and we're probably six months into it."

Libin compares the rapid adoption of video communication due to the pandemic to the slower adoption of the internet in the 1990s.

Impact of Video on Various Sectors

  • Phil Libin clarifies that while he doesn't expect a complete transition to video for all activities, he believes video will have a significant impact on nearly all aspects of life and business.
  • He draws parallels between the integration of the internet into society and the current integration of video, predicting a hybrid future where video plays a crucial role.

"I don't think that it's going to be 100% transition to video, meaning that 100% of the things we'll do will do over video. I think that 100% of the things we do will be impacted by video."

Libin distinguishes between the use of video for everything and its influential presence in various aspects of life.

"It's going to be this hybrid world where even when we're traveling and going to restaurants, we're going to be interacting with important parts of the world on an almost daily basis over video."

Libin envisions a future where video is an integral part of daily interactions, even as in-person activities resume.

Evolution of Video as a Medium

  • Phil Libin emphasizes that just as early films and TV shows evolved from simply mimicking theater and previous technologies, video communication will evolve beyond being a mere substitute for in-person meetings.
  • He predicts that new, video-native applications and startups will emerge, transforming the way we use video in ways we can't yet predict.

"So the first movies were just like a poor replacement for theater, but that was more scalable. It wasn't until decades later that people figured out actually, movies aren't about a replacement for the theater, they're an entirely new thing."

Libin uses the evolution of film as an analogy for the potential transformation of video communication.

"Obviously within a year, this isn't what video is going to be like. Obviously it's going to be the next generation of native to video companies that comes along and says, well, no, we're not trying to recreate the old reality."

Libin foresees a shift from using video as a stopgap solution to developing innovative uses that leverage the medium's unique capabilities.

Discipline and Team Trust

  • Phil Libin emphasizes the importance of discipline in managing a well-funded company.
  • He trusts his team to maintain discipline and avoid failure due to having too much funding.
  • Phil believes that startups often fail from indigestion (too much investment) rather than starvation (lack of investment), especially in Silicon Valley.

"I trust my team enough to know that we have discipline at this point. So we're not going to fail. I think his role of puts it right, of indigestion. He says a lot of startups fail from indigestion. More than starvation in Silicon Valley, I think the world over, that's probably pretty reversed."

Phil trusts his team's discipline to handle the company's funds responsibly and prevent failure due to excessive funding, which is a common issue in the startup ecosystem.

Potential Reasons for Failure

  • Phil identifies people mistakes as the most likely reason for a company's failure.
  • He distinguishes between hindsight mistakes and wrong bets on the future direction of the world.
  • Phil acknowledges the inherent risk in venture, which does not guarantee success but offers a plausible probability of significant success.

"The most likely reason that I think we would fail is because we place some wrong bets, not because we make fatal errors, but just because we bet on ways that the world is going to go, that the world doesn't go in that way."

Phil believes that failure is most likely to come from incorrect predictions about the future rather than operational mistakes, accepting that risk is a natural part of venture endeavors.

Protecting the Downside

  • Phil suggests that early-stage companies should focus on impact rather than survival at a small level.
  • He emphasizes the importance of becoming the default answer to an important question for people.
  • The company's ultimate size should be determined by the natural scale of its impact, and it should not scale past its point of impact.

"We want to become the default answer to some important question for some people. We want for somebody, hopefully a large number eventually, but initially for somebody to be like, oh, for this important area of my life is my default answer is my go to."

Phil's priority is to create a significant impact in a specific area before considering the longevity of the company, with the belief that the company should grow naturally based on the impact it has on people's lives.

Personal Growth and Book Recommendations

  • Phil recommends "Kafka on the Shore" by Haruki Murakami for its transformative effect on the reader.
  • He values books that have a profound impact on personal growth rather than just their content.

"Whenever I read this book, I come out of it a different and better person. And so it's not about what the book's about, it's about its effect."

Phil sees "Kafka on the Shore" as a book that can significantly alter a person's perspective, highlighting the importance of literature in personal development.

Silicon Valley Tech Scene

  • Phil wishes to decentralize the Silicon Valley tech scene to globalize opportunity.
  • He believes that talent is evenly distributed, but opportunity is not, which he finds unfair and detrimental to global talent realization.

"I think it's fundamentally unfair that exceptional talent, like Mozart level, brilliant, exceptional talent is very, very rare in the world, but it's evenly distributed, but opportunity isn't."

Phil critiques the concentration of opportunity in Silicon Valley and advocates for a more equitable distribution of chances for talented individuals worldwide.

Strengths and Weaknesses

  • Phil believes his strength lies in preemptively avoiding conflicts of interest.
  • His self-professed weakness is his lack of upper body strength.

"The nicest thing that anyone's ever said about me that's kind of resonated is that I try to see inherent conflicts of interest and alignments and just avoid them, like, way before they happen."

Phil prides himself on his ability to foresee and prevent conflicts of interest, which he considers a key strength in his professional life.

Board Member Experience

  • Phil praises Roloff, a board member, for his ability to remember details and continue conversations without starting over.
  • He values Roloff's engagement and memory, which makes board meetings more productive and less frustrating.

"Rolov's superpower is he picks up every conversation exactly where the last one left off."

Phil appreciates Roloff's unique approach to board meetings, which contrasts with the typical experience of having to recap previous discussions due to other board members' forgetfulness.

Future Vision for Mmhmm

  • Phil envisions Mmhmm re-injecting personality and fun into video communication.
  • He aims for Mmhmm to improve people's lives significantly within five years, making remote interactions better than before.

"I think we have re-injected personality and fun into this video-based world, and we've made experiences that are much better than they used to be."

Phil's goal for Mmhmm is to enhance the quality of video-based interactions, making them more enjoyable and beneficial for users in the long term.

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