← The Twenty Minute VC (20VC): Venture Capital | Startup Funding | The Pitch
The Twenty Minute VC (20VC): Venture Capital | Startup Funding | The Pitch
20VC: Lessons from Jensen Huang on "Founder Mode" | How to Know if OpenAI or Anthropic Will Kill your Company | How USV Liking Music Made Them $1BN on an Investment | The Five Year Desert to Product Market Fit & a $5.3BN Valuation with Shiv Rao @ Abridge
01:04:46
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- [00:00]
Shiv Rao
You have to taste good things to have good taste. It is critical in Vertical AI being one of the first. When you saw the announcements from OpenAI and Anthropic about forward deployed engineers and these partnerships with big private equity groups to go help their portfolios, if that wasn't a sign that there is absolutely an incredible opportunity for the foreseeable future for vertical AI, I don't know what is. We're in for a tsunami of healthcare needs and the system is not prepared to deliver it. They did the seed and the A USV was our business model initially. The more you can feel inevitable, the more you will be.
- [00:41]
Harry Stebbings
This is 20 VC with me, Harry Stebbings now. Joining me in the hot seat today we have Shiv Rao, Founder and CEO of Abridge. What I love about Abridge is yes, it is a $5.3 billion company today. Yes, they have the best investors in the world in the company today. But they went five six year wilderness period where they were founded in 2018. They did a seed round of five on 15. That level of dilution, wow, those were the days. But now they are one of the hottest companies in AI going to show that persistence and consistency in the face of people not always believing in you is the key to success. As I said, $300 million Series E last round at a $5.3 billion valuation. This is an incredible story and I'm so happy to welcome shivered Abridge. But before we dive into here's a question for any founder listening what would your marketing team do with an extra 30 hours a week? That's roughly what teams get back when they stop manually building every campaign, every workflow, every email. Right now, your best marketing people are spending their days cloning templates, configuring audience segments, and chasing data across systems. That's not what you hired them for. Conversion is the first marketing automation platform where AI agents handle the execution. Your team focuses on strategy, on messaging and pipeline. The agents handle the rest, building campaigns, personalizing every touchpoint per account, and deciding the next best action automatically. Whether that's pinging your ae, launching a retargeting sequence, or dropping someone into a nurture, the agents figure it out. And that's why over 4,000 B2B companies have already made the switch, including People, Data Labs and Adaptive Security. So head on over to Qonversion AI20VC and get $10,000 off. That's conversion AI20VC for $10,000 off. After granola captures the conversation, Artisan helps start the next one. Meet Ava, the first autonomous AI BDR built by Artisan to run your entire outbound on autopilot.
- [02:46]
Jason Lemkin
Hey, Jason Lemkin from Saster here. Artisan is S tier. We've replaced our entire outbound sales team with Artisan, I believe. We've sent over 50,000 highly customized emails to Artisan. The open rate is twice what it was with humans and they close 100k deals day after day.
- [03:00]
Harry Stebbings
AVA sources leads from over 250 million contacts, enriches every prospect with intense signals, then writes and sends personalized multi channel outreach, self optimizing over time. When a lead replies, she handles objections and books meetings straight into your AES calendars without any human input. Artisan is backed by Y Combinator and has raised $36 million to build the first truly autonomous AI BDR. Hire Ava the AI BDR and put your outbound on autopilot at Artisan Co20VC. That's a R T I S A N CO and speaking of great companies, we have to talk about Monaco. For years I've watched some of the best founders and early go to market teams struggle with sales. Too many CRMs, too many point solutions, too much manual work. Well, that changes with Monaco. Monaco replaces your legacy CRM and fragmented sales stack with a single AI native platform. Monaco's agents automatically build and score your entire TAM layer in real time signals create and run outbound sequences, schedule calls and record and transcribe meetings. Your pipeline practically manages itself. Monaco creates reminders, drafts follow up emails for you and keeps deals moving forward. So that means more meetings, higher conversion rates and faster revenue growth. If you're an early stage startup tired of duct taping sales tools together and looking to grow revenue faster, check out monaco@monaco.com youm have now arrived at your destination.
- [04:35]
Ari (likely Arianna or Ari, interviewer)
Shiv, I am so excited for this. Now people don't know, but we actually
- [04:39]
Harry Stebbings
met because I used you for for
- [04:42]
Ari (likely Arianna or Ari, interviewer)
a reference on a company and you were phenomenally helpful to the extent that my partner was like, can we just invest in him instead? Which really would have been a much better idea and I should have gone yes, 100% and broken all the rules for it. But thank you so much for joining me.
- [04:56]
Shiv Rao
Oh, it's such a privilege, Ari. You're a legend, dude.
- [04:59]
Harry Stebbings
I so appreciate that.
- [05:00]
Ari (likely Arianna or Ari, interviewer)
So let's start with one that I
- [05:02]
Harry Stebbings
often think about, which is great.
- [05:04]
Ari (likely Arianna or Ari, interviewer)
CEOs are motivated by one of two things I found. Either the fear of losing or the thrill of winning. No right or wrong.
- [05:11]
Harry Stebbings
But if you were to say which
- [05:12]
Ari (likely Arianna or Ari, interviewer)
one you are, which would you say? You are.
- [05:14]
Shiv Rao
Oh, it's the thrill of winning 100%. I love high stakes games. Going for broke and trying to do something really big. Trying to build a new product and trying to bend a new market or create a new one.
- [05:26]
Ari (likely Arianna or Ari, interviewer)
You said bend a new market. I think you started the company in 2018.
- [05:29]
Shiv Rao
Yeah.
- [05:30]
Ari (likely Arianna or Ari, interviewer)
Now it's 2026. You've been hot for like two or three years.
- [05:33]
Harry Stebbings
That is a five year wilderness walk.
- [05:36]
Shiv Rao
Yeah.
- [05:37]
Ari (likely Arianna or Ari, interviewer)
What are your biggest lessons on market, Tim, as a result of that? Reflecting?
- [05:42]
Shiv Rao
Yeah, I think that certain companies, certainly ours, have to have a true north. You live every day in this anticipation that the sky is going to open up because you have this thesis about the market and you might not necessarily know exactly when it's going to come true, but you know it's going to come true. And when you feel that in your bones, then I think you can draw a lot of resilience. You can, you sort of figure out that you just need to stay standing, you just need to not die. You just need to sort of like be there when it's happening. And for us it was absolutely that way. It was this thesis that this idea, this secret hiding in plain sight, that this, this data set, these conversations, it's the most human signal and it really powers healthcare. You can build a whole new set of rails on top of this signal. And the thinking was, well, at some point in time the technology is going to be right, but also the market is going to be open.
- [06:31]
Ari (likely Arianna or Ari, interviewer)
Would you have died on this hill? And what I mean by that is sometimes you can have a thesis, you can even be right, but the market doesn't fast enough.
- [06:40]
Shiv Rao
Yeah, I would have died on this hill. I was willing to pivot on the specific product, in what specific order we'd put a feature out. I was willing to pivot on go to market. Certainly we learned so much. Healthcare is incredibly complicated. Figuring out go to market is a really big part of how you win. But I wasn't willing to move on the thesis. And for us, the thesis that healthcare is about people and they're having conversations, I think was just like core to the identity. And it would just have to be an entirely new thing. We just sort of shut it down. And if there was something else we could get really passionate about.
- [07:14]
Ari (likely Arianna or Ari, interviewer)
You said before about the references that
- [07:16]
Harry Stebbings
I take, I do, I stalk the shit out of you before this, which should make you feel very comfortable sitting
- [07:22]
Ari (likely Arianna or Ari, interviewer)
in this dark room alone with me end of the day in London. Why not? I spoke to Andy Weissman, who led Your Seed round. I think market timing is one thing founders often worry about. Fundraising is another very hard thing. Was it an easy pre Seed Seed early fundraising environment for you?
- [07:39]
Shiv Rao
I wouldn't say it was easy, but it wasn't hard at the same time. Now, this was 2018, 2019, our series seed was like we raised $5 million on a pre of 15. So not the world we live in right now, but it made sense. Then we felt like this was market and we did a really good job. I think that there is founder market fit, but there's also founder partner fit. When you just have chemistry with a person at a firm, you just know you're going to find a way to work together. So with USV and Andy, I stalked Union Square Ventures for years ahead of the first meeting that I had with them. And with him, I would read all their tweets. When it was Twitter and they had this ritual where they would talk about music. And I was always really impressed that they seemed to pattern match across totally different genres. The country western on Monday and then indie hip hop on Wednesday and then like Swedish death metal on Friday. And to me, that's kind of how I enjoy music as well. And that if they abstract at that level, my thesis was they could be the right tech investor to think about healthcare in a new, different way. So found a way to get to them through an angel, through a friend at mit. We went in and we sort of pitched and I knew at the end of that meeting that we were going to work together.
- [08:52]
Ari (likely Arianna or Ari, interviewer)
Would you not approve of my liking Celine Dion and Taylor Swift? That would go against me.
- [08:59]
Shiv Rao
Speaking of Andy, Andy says this thing. He's the biggest coffee snob in the world. And I once asked him about exactly what his rituals are and the temperature and the bean and all that stuff. And he was just like, coffee's coffee, man. I'll have any coffee. And when you ask him about music, he'll say, I like all the sounds. So maybe on some level you can see the patterns and you can enjoy anything.
- [09:19]
Ari (likely Arianna or Ari, interviewer)
I know it's very random, but when
- [09:21]
Harry Stebbings
you said about coffee there and Andy, it made me think about taste. And everyone talks about taste today as
- [09:27]
Ari (likely Arianna or Ari, interviewer)
the difference between those that are truly special and what separates humans and AI. How do you reflect on taste being the differentiator?
- [09:36]
Shiv Rao
When we created our company values, this is before this whole taste cycle, we created our company values in, like, maybe the most recent variant in 2021 or 2022. One of them is that you have to taste good things to have good Taste. And this idea of taste, I think makes a ton of sense to us. It's not just judgment, but it's being able to sort of see patterns, but put things together in interesting ways that hit different, that feel different, that feel authentic, that really represent a person or people. And I think that's where the really, truly magical companies are these days, where you can kind of feel the human behind this product and feel the decisions that they made, the things that they said no to, the strong opinions held tightly that they died on the hill for.
- [10:22]
Ari (likely Arianna or Ari, interviewer)
I love that tastes good things to have good taste. Does that mean you should taste everything?
- [10:27]
Shiv Rao
No, but I do think it means you got to be discerning. But if you're not exposing yourself to certain flavors, then you're just not going to be aware of it. I think the way we translate that in the company, for example, is we should be reading the latest archive papers about some new type of machine learning model that maybe we can leverage. We should be thinking about the latest UI UX patterns out there and where we could take these primitives in our own specific space. We should be just sort of like living at the edge of culture if we also want to create it. And I think also the best companies in some way, shape or form are creating culture.
- [11:00]
Ari (likely Arianna or Ari, interviewer)
You said about strong opinions, loosely held.
- [11:02]
Shiv Rao
Yeah.
- [11:03]
Ari (likely Arianna or Ari, interviewer)
What was the strongest opinion that you've had? That's loosely held?
- [11:07]
Shiv Rao
Yeah, the loosely held. There's the tightly held ones, the ones that we would die on the hill on. The loosely held ones that I've shifted on pretty profoundly over time. I've had loosely held opinions about where the company's limits are, like how far we could expand and how quickly we could expand. I think a lot of our priors, all of our priors are getting updated.
- [11:26]
Harry Stebbings
You should expect to grow as quickly
- [11:27]
Ari (likely Arianna or Ari, interviewer)
as you have done.
- [11:28]
Shiv Rao
In some way, I feel like we're on this journey that we were meant to be on. We're doing this thing that we're supposed to do. And by we, I mean it's not just the company, but all of our health system partners. It feels like we're a part of a movement that we're trying to create right now. So I can't say that I ever woke up being like, what is going on? But I can say that I've gone to bed at night feeling like, this is awesome, this is great. And we have to think about making it even greater. You wake up in the morning and you're not, not at all satisfied. But at night, as one, that one Mentor, a cardiology mentor once told me is like, try to go to bed with a little bit of perspective and a little bit of gratitude at least knowing full well you're going to wake up with that fire in your belly again.
- [12:06]
Ari (likely Arianna or Ari, interviewer)
As a founder, do you think you can ever be satisfied?
- [12:08]
Shiv Rao
Probably not. You know, like you always want something more, you always want to build something bigger. And your ambition, it always gets bigger. You know, maybe it doesn't get bigger. Maybe you just, you sort of reconcile yourself to a change in scope over time.
- [12:23]
Ari (likely Arianna or Ari, interviewer)
You said about the healthcare partners you work with today, I'm an investor in Ligora. By no means similar in terms of space, but large space, that's traditional are now seeing tidal wave of adoption similar to healthcare. Every single law firm right now is going, AI, I need AI to stay relevant. Is that the same with healthcare and healthcare partners, or is the downside fear factor making it slower?
- [12:49]
Shiv Rao
No, 100%. It's every single health system right now. There are doctors right now who we've heard, who won't sign up to join a healthcare system, a hospital, if they don't have a bridge. It's one of those moments where all of a sudden, almost overnight, over the course of like three to four years, something just became, you know, table stakes. It's part and parcel with how care is delivered, especially in the outpatient space.
- [13:11]
Ari (likely Arianna or Ari, interviewer)
What did you not expect in GTM that surprised you most?
- [13:15]
Shiv Rao
This is where strong ideas held loosely when you first raise capital. Maybe you hear an investor give you advice about starting down market and swimming upstream, disrupting over time. Get that pmf, find those fast feedback loops and it's true to an extent. But you just have to be really careful and mindful because healthcare specifically in the United states, it's not one $5.3 trillion market, it's a bunch of different markets. And depending on who you're trying to serve, you have to be really careful about how you segment if you're trying to serve clinicians, doctors, there's about a million doctors in the country, maybe 800,000 of them are actually practicing. The vast majority of them are concentrated in large care delivery systems. They're called integrated delivery networks or payer providers. They also have payer arms, insurance arms, or their academic medical centers like the Emory's, the Yales, the UCSFs and beyond. And so when they're concentrated there, you have to think about getting there as fast as you possibly can because obviously you've got huge ambition. You want to create as much impact as you want as you need to. And so the trap that a lot of I think healthcare founders fall into is that they stay down market. They don't figure out, they don't time their YOLO shot to go up market at the right moment. And for us, things really worked out. We're incredibly lucky, incredibly privileged, but things worked out. A lot of different things happened in the marketplace at the same time. On the other side of the pandemic, I'd say 40, 50% of the doctors in this country were saying that they were burnt out. And there was a study about nurses recently that was published in JAMA that suggested that 30% of nurses in the country didn't want to be nurses in the next 12 months. So there's all this burnout, all this fatigue. There's incredible financial pressures that have only continued since then, coming down from, for example, Medicare cuts. At the same time, there's this new technology, there's AI. We were in that moment where without even knowing it, we were pre selling the market and preparing the market for what we could bring. And then in 2023, when the sky opened, we ran right in.
- [15:12]
Ari (likely Arianna or Ari, interviewer)
I want to unpack a load of things there. How important is being first?
- [15:16]
Shiv Rao
It is critical in vertical AI being one of the first. I think being late doesn't work, but there's that refrain that being early is also being wrong. I think we're a good case study in being resilient. You can sort of overcome that issue of being perhaps too early. There's three variants of AI, native company. Maybe there's like we started three months after the transformer paper. In my head, there's a post transformer paper pre LLM company, There's post LLM pre agent company and there's post agent company. And anymore depending on your vintage, you have to make sure that you become the latest variant as fast as you possibly can. And that might mean that your product evolves pretty significantly. It might also mean that the way you organize your company and you operate your company evolves pretty significantly as we're seeing in this new era with agents. But we were a post transformer pre LLM. And as soon as the LLM moment happened, we became that as fast as we possibly could in all the different ways. And now we've been doing the same thing in this new world with agents.
- [16:17]
Ari (likely Arianna or Ari, interviewer)
There's a couple of different ways that you can break down competition. One of them is the age old. And I see Max from Ligora pushing back against this. Now Anthropic are going to release a legal Product? Well, the foundation models could very easily do an abridge and build out a product suite. How do you fight back against the foundation models? We'll build healthcare applications and replace you.
- [16:39]
Shiv Rao
If you are fighting against them, you've already lost. If you haven't figured out how you're going to win with them, how are you going to just coexist but actually find ways to collaborate potentially? And if the tailwinds that they create are not yours to leverage, then you're screwed.
- [16:57]
Ari (likely Arianna or Ari, interviewer)
What does that mean for you then?
- [16:58]
Shiv Rao
If we take that so healthcare, we say this is a vertical AI company, but you think about it, healthcare, 5.3 trillion dollar market, it's about 18, 19% of US GDP. I don't know if it's vertical AI company. We are an AI company in my head serving one of the biggest opportunities that is out there in this market. You can go millions of miles deep, especially on the enterprise side of the spectrum of healthcare. You can go millions of miles deep in a regulated industry with proprietary data sets that you can build into very, very specific workflows in a way that's really, really hard to replicate. But being fast, getting scale very, very quickly is crucial because the scale enables you to not just build more products and just get more surface area. But we do a lot of mid training and post training in the company. On the post training side, it's being able to learn from all the users edits on a daily basis. It's being able to be useful for all the different types of doctors and all the different settings they deliver care and all the different languages they might use with their patients. And so people, I think in 2023 thought that was like last mile. That's actually most of it is that part. The model piece is much less. But even on the model side I think the vertical AI companies that have the most leverage, that have the most upside are the ones that can reach farther down into the stack and own their destiny in a differentiated way that can kind of control their piano.
- [18:31]
Harry Stebbings
How much of the quality of your
- [18:32]
Ari (likely Arianna or Ari, interviewer)
product is derived from the quality of model that you sit on top of.
- [18:36]
Shiv Rao
So about 40% of our model outputs inside our product are generated by in house models. And that varies from month to month. Next month it might be 60% because we've distilled a new open source model and fine tuned it and gotten some feedback and we are convicted and we've just replaced a frontier model with this new in house model.
- [18:59]
Harry Stebbings
What do you expect that to be
- [19:01]
Ari (likely Arianna or Ari, interviewer)
in two to three years?
- [19:02]
Shiv Rao
It's A great question. So I think this is where we're all kind of nobody knows the answer, but you just have to be principled in how you approach this. So there's any number of different problems we solve as a company with our product. Some of those problems you can kind of imagine ringing the bell relatively easily. Like, okay, if we just help the nurse with this piece of data, getting into this discrete field at this time in their workflow, we won the game. It doesn't need to be. There's no bells and whistles around this. It's like once you do it, you've done it. It's kind of binary and those sorts of tasks. Being able to just crush it with an in house model makes total sense for a lot of different reasons. But most importantly for the user, chances are it's going to be faster. You can kind of optimize that model over time from not just a latency perspective, but also from a cost standpoint. Once you've done it too, you can kind of set and forget to some extent, like, okay, let's move on to the next challenge inside this new product that we're delivering for nurses. But then there are certain challenges in your product suite that you're never going to be perfect on. But every week, every month, you want to be able to look back and say you're less imperfect than you were before. And it's going to matter. It needs to matter to the market. If the market cares about you always improving on something that you don't think you'll ever be perfect on, and healthcare has a lot of use cases like this, it makes more sense to ride the frontier wave.
- [20:25]
Ari (likely Arianna or Ari, interviewer)
Why did you decide to build your own models when Cursor did and TBD on whether that was actually effective? When you have the historical precedents that say underlying models move faster, more efficiently than you would create them yourself, why create them yourself?
- [20:39]
Shiv Rao
Well, number one, it starts with the end user. Milliseconds matter when you're in workflow. These are doctors who are, they have no patience for new technology. Our refrain inside the company is reduce, reduce, reduce. From a product and user experience standpoint, it's like we want to be good air conditioning where when it's set right, when the background you're just focusing on everything that's more important. And to get to that though, you really need to think about being in workflow. The thinking machine stuff that just came out is really fascinating. It's like it's an agent that's in the moment with you. Right? But that kind of experience. You need insane performance and latency. And that's something that we weren't able to achieve in an easy, elegant way with frontier models. So for certain use cases there was really no choice. It started with the end user. We're like, okay to deliver this kind of value, this specific type of value in workflows, so that before the patient leaves the room, the doctor is okaying an order or putting in the right visit diagnosis that ends up informing billing and their own reimbursement. These are high stakes workflows. You need to be fast and so that's where things started. But then quality is a part of it too.
- [21:44]
Harry Stebbings
What does the relationship look like for
- [21:46]
Ari (likely Arianna or Ari, interviewer)
you between you and Frontier models and you and open source models, and has your reliance on one changed over time?
- [21:52]
Shiv Rao
It's dynamic. I think inside the company we just always remind ourselves that the only thing that matters is the end user. We just have to have the best product and whatever it's going to take. There cannot be any pride of ownership here. It's just about what gives us the best user experience. Now that has ended up serving us really, really well because especially over the last weeks there's been a lot of angst about perhaps costs going up in the coming weeks and months and what's that going to do?
- [22:18]
Ari (likely Arianna or Ari, interviewer)
How cost conscious are you? If you look at open, obviously it's much cheaper to free versus being reliant on a frontier. Do you care if the output is different?
- [22:27]
Shiv Rao
I don't care now, but I also know that my future self might care more. That attitude is again, I think just putting the user first in our specific space, given our product and where it sits in workflow has allowed us to build at a layer of the stack that gives us agency on the PL that we wouldn't have otherwise. And that's awesome. But that's not what we're optimizing for right now, obviously.
- [22:52]
Ari (likely Arianna or Ari, interviewer)
When do you need to optimize? Because I have this conversation with a lot of founders and it's the same this, which is blindly. We've got a lot of funding, we don't need to optimize for cost now. Absolutely the right answer. When do you. When you go public.
- [23:05]
Shiv Rao
I think when it gets in the way of our ability to create more impact, to raise more money, to impact more users. I don't think it necessarily has to do with anything around Ipoing. One of our investors is Henry Kravis and I remember sitting down with him in the first meeting and one of his questions was, do you Want to go public. And I remember starting to clumsily navigate an answer on the fly and he interrupted me and said, no, you don't, you don't need to. Why are you even thinking about it? The right answer was no, I don't need to. I have a mission and to serve that mission, I will do what it takes. And if I can do it in the private markets, I'll raise money there. If I need to go public to do that, then I will go public.
- [23:42]
Ari (likely Arianna or Ari, interviewer)
I think one of the biggest barriers to AI progression within large enterprises in the next few years will be data cleanliness. Data structure within large enterprises. Is it a mess in large healthcare organizations in terms of data preparation, data structure, data cleanliness?
- [23:58]
Shiv Rao
Yeah, it is. When you saw the announcements from OpenAI and Anthropic about forward deployed engineers and these partnerships with big private equity groups to go help their portfolios, if that wasn't a sign that there is absolutely an incredible opportunity for the foreseeable future for vertical AI, I don't know what is.
- [24:19]
Ari (likely Arianna or Ari, interviewer)
Help me understand that.
- [24:20]
Harry Stebbings
Why is that?
- [24:21]
Shiv Rao
It's not easy. It's not easy to go into one of these enterprises and figure stuff out to get access to the data, to clean the data, to organize the data, to be able to integrate into specific workflows, to do it in a compliant way, to check off all the boxes. It's not SOC 2, it's high trust, it's all the cyber stuff. It's being able to know that behavioral health information from a psychological encounter, for example, that data should be treated very differently than than data that's coming from an internal medicine, primary care physicians encounter. There's just so much to it and it takes a lot of effort to build a machine that's scalable.
- [24:56]
Ari (likely Arianna or Ari, interviewer)
Do you have to have an FDE process to be successful selling to enterprise with AI tools?
- [25:01]
Shiv Rao
No, you don't. Not in our case. You're going to get to that 0 to 1. You're going to get to that first product in all the ways like people in the health systems, in the clinics and listening to the doctors and the nurses and figuring it out and. But that's not for deployed motion, that's just figuring out how to build a product that fits. But if your first product is something that is everywhere, if you've attacked a workflow that can scale, then you're sort of set. It's a classic motion of we picked a first product that we knew was everywhere in healthcare. Every single doctor, practically speaking, has to speak to a patient. Great. That's our signal. We're going to to attach ourselves to that spoken signal and create value. Great. What's our first bit of value? It's a note. Got it. Do they hate notes? Yep, they hate notes. We can automate them.
- [25:48]
Ari (likely Arianna or Ari, interviewer)
Great.
- [25:48]
Shiv Rao
We created notes. Now let's go scale notes. Then it was like, what's next? They hate placing those orders. They have to hit all kinds of dropdown menus and like figure out what the right order is. Cool, let's do orders. They hate billing. No doctor went to billing school, accounting school, revenue cycle school. And when I was a corporate VC at a large health system, we used to have these lunch and learns as a doctor where we try to teach doctors about revenue cycle with pizza and PowerPoints. Every single doctor thousand yard stare. Nobody wants to be there. So can we automate that for them? Absolutely. So now we've gotten to this point over the course of a few years where it's like every single clinician has this team of assistants that we are deploying in the background to go do all the jobs. And many of these jobs nobody wanted to do in the first place.
- [26:33]
Ari (likely Arianna or Ari, interviewer)
I spoke to one of your ambassadors who remain nameless for this one, and they said, amazing products and amazing everything that you said. But if you are to fulfill the enterprise value that you have today and that you will have moving forwards, you have to move closer to the flow of money. Is that fair?
- [26:49]
Shiv Rao
I think it's not only fair, it's also what we want to do when you think about it in the United States. But really this is true in many parts of the world. Clinicians, doctors, they're not compensated for the care that they deliver. They're compensated for the care that they documented that they deliver. When we first realized that, okay, we're going after this spoken signal and the first thing that we're going to build with it before, during, after we capture it is a note. We knew we were creating bills too. And so you got to take that responsibility very seriously because the enterprise motion in healthcare is complicated. You have a lot of different stakeholders. You have your end users, but then you have the decision makers. And there's a CMIO Chief Medical Information Officer, there is a cio, a Chief Information Officer, and then there is a cfo. And they all have a different lens. And being able to thread the needle, being able to resonate with all three is really how you win the day. And so being able to recognize from the get that, okay, these notes are actually going to end up being bills. So let's approach this Note generation architecture, that workflow, and now what's become a much more agent driven process. Let's approach that very deliberately so that we have this, the immediate extension afterwards into the CFO's world.
- [28:00]
Ari (likely Arianna or Ari, interviewer)
How do you compete when Epic do the same product? They're like the product that no one likes but is so entrenched. How do you compete in that world?
- [28:10]
Shiv Rao
We are not competing with Epic. Epic is a.
- [28:13]
Ari (likely Arianna or Ari, interviewer)
Do they not have a competitive product to you?
- [28:16]
Shiv Rao
They have a product or a feature. They have something out there. Now even that's been out for a beat that helps with notes. But what I was explaining to you earlier is really, really critical for us. It was never about the note, it was always about the signal, the conversation that we were using as the wedge. That conversation, that spoken signal, allows us to now build into any number of workflows, even beyond notes. And when you're building notes with, for example, all of the revenue cycle that comes next, you build them differently. It's a moment where kind of like the foundation model company, like, we don't ever want to be an electronic medical record. And by the way, I grew up with Epic and I was at a health system that had multiple medical records and I was always the happiest when I was using Epic compared to any others out there. So we build on top of them, but the layer of the stack that we are building is the intelligence layer. And the wedge that we've chosen is the conversation, because it's that sacrosanct moment in healthcare where the actual value is getting exchanged, where the doctor and the patient or the nurse and the patient, where they're talking about the care plans. And so being able to capture them in a way that's not just clinically useful, but compliant is a way to build out that layer over time and you can extend very easily.
- [29:27]
Ari (likely Arianna or Ari, interviewer)
I think lessons are often learned from reflecting on what you did that you shouldn't have done. What did you do that. With the benefit of hindsight, you're like, it would have been better to choose
- [29:37]
Shiv Rao
an alternative path during the pandemic. I think everybody's just sort of figuring it out. I think perhaps we could have doubled down on research and just sort of hibernated for a beat into research caves. Or we, we were fine tuning Bert models, Bert and Biobert and Longformer and Pegasus and T5, and we had published a paper in 2021 around how you could actually do some of the jobs we do today at scale, but do it with models that predated LLMs. There's a world where we could have done more R and D. But the decision that we made pretty early on, even before the pandemic, was that the barrier to entry on the doctor side was so high. Let's go build for patients. So we built a direct to consumer app that would allow any one of us to ask our doctor, hey, can I record and capture the conversation and create a summary for themselves? I remember when we first pitched USV for that seed round. One of our slides had a doctor on one side, a patient on the other. There's this mobile phone in the middle and was like, we can help both. Both sides need help. Both sides want agency, both sides want to own, control the story or have that story. And we can do that. We can serve them with AI. And so we started on one side. I think there's a part of me that thinks that we could have perhaps built differently there on the patient side. It's super core to who we are and we'll get back to that. Actually we're getting back to the patient side of that slide now again.
- [30:53]
Ari (likely Arianna or Ari, interviewer)
But it was a strategic mistake then
- [30:55]
Shiv Rao
to build that patient side, relatively speaking. Maybe we could have spent a couple more cycles on R and D as opposed to. I mean we were really banging our heads against the wall trying to figure out business models that could work. Maybe that's the mistake. It's not actually that we built in that space that I really worked hard to figure out if we had a company there, there and we didn't. Because the companies that you can build on top of just the consumer in healthcare, oftentimes there's the kind of companies that paint themselves into a corner that can never be trustworthy enough to go enterprise. They're the kind of companies where the business models would require you to take multiple showers every single day because you're selling really private sensitive information to who knows what entity. And we didn't want to be that, but we realized that too late. I think the pivot that I should have made is probably okay, we built something really valuable here. But let's not lose sight of where the actual revenues are going to be. Back to maybe your original question I think very strong about what the thesis of the company was, but we pivoted a lot. Not just on go to market, but also business model.
- [31:57]
Ari (likely Arianna or Ari, interviewer)
You said about business model pivot there. I think a lot of people are talking about the rise of consumption based pricing. Like this is incredibly innovative thing. Twilio has been around for a while
- [32:08]
Harry Stebbings
but AI tech bros love that and
- [32:12]
Ari (likely Arianna or Ari, interviewer)
CFOs that you mentioned. You mentioned different stakeholders. CFOs want seat pricing. They want to know that I've got 10 doctors, I got 10 bills. What is your lessons on the pricing mechanism of the future for many of these frontier businesses?
- [32:25]
Shiv Rao
Well, it's interesting. I think we're still learning. We started with a keep it simple idea sensibility per se and enterprise licensing the entire system. The first big competitor for us was Microsoft. They had bought a company called nuance for 20 some billion some years ago and they had a product in our category and we still compete with them in the marketplace. But I think we've established ourselves as a completely different type of company with a completely different kind of offering. And at this point in time, we don't approach them the same way we used to.
- [32:56]
Ari (likely Arianna or Ari, interviewer)
So you don't buy bundling as a real threat. I remember I'm completely forgetting Nabla. Nabla's a competitor of yours, I think, and candidate. I looked at them and I was really concerned that bundling would be a very prominent threat to their ability to dominate the market. Was that a wrong concern of mine?
- [33:13]
Shiv Rao
We don't see either of those companies much anymore. I'm not sure if it has anything to do with bundling. I think it has to just do with us being able to carve off a category, create a category that I think think has resonated with the marketplace. I was two days ago, I was in Atlanta and at Emory and was on some panels over there. But one of the doctors on the panel used a bridge as a verb and then another doctor later used it as a verb. And then I asked one over dinner, like, what'd you mean when you said that? And when they describe what they mean by that, they mean something that it's a lot more than like, oh, it created a note for me. It's like, oh, it did all these different jobs for me and it unburdened me and it allowed me to help just focus on the patient in front of me. And I think that's what's allowed us to win. Back to your pricing question. Yeah. I think there's a part of me that thinks that there's a lot of complex models out there and especially the Microsofts of the world just obfuscate things so much and make things so complicated. We've won so far by I think even competitively positioning against that. But there's a part of me that thinks that we need to continue to take notes here because I see some companies in other verticals with incredibly complex structures and find out it's working and wonder if there's something to it.
- [34:23]
Ari (likely Arianna or Ari, interviewer)
I always say I always want my main course to be someone else's dessert because I'm going to care much more than they do. And you care much more than Microsoft do about this market by very nature of the fact that it's all you do. Any advice to founders listening where we have a lot of companies where it's like, well, they kind of could do and they kind of do have a competitive product, should we just row our own race? Should we be unwaveringly focused on them also? Any advice to them if you're sitting down with them?
- [34:50]
Shiv Rao
I mean, you want to compete against them. You obviously want to kill the competition, but the way you can kill the competition is mostly focusing on your product and keeping in mind what they're doing so that you can competitively position, but also counter position. Big companies oftentimes have a lot of soft spots that you can counter position against where they just have to watch
- [35:11]
Ari (likely Arianna or Ari, interviewer)
you when you say counter position in that way. I know because I love Hamilton Helmet's seven powers. Can you explain what that means and how you think about using it to
- [35:19]
Shiv Rao
win when you're building in a way where the competitor couldn't build because it would impact their current business, it would hurt them, it really pushes them to think hard and probably prohibits them from directly competing against you.
- [35:33]
Ari (likely Arianna or Ari, interviewer)
What could you make a large amount of money on today? But for some reason you do not. And why is that?
- [35:39]
Shiv Rao
We don't make any money selling data. We don't because trust is everything in healthcare. The industry moves at the speed of trust. It takes so long to build up. And we've been able to build it up, I think in record time, relatively speaking. In this industry, I think we've done in four years what a lot of companies take 15 to 20 years to be able to do. And that's all thanks to the people inside the company and the relationships that they build and at the core of the product that we've been able to deliver and the value that we've been able to create.
- [36:04]
Ari (likely Arianna or Ari, interviewer)
Can I ask you a question? Is that not a moral question for the greater good? And what I mean by that is if you were to create a Mercur for healthcare data, you would actually be empowering frontier models to create better models for the world to benefit global healthcare services. Is there not a moral question?
- [36:21]
Shiv Rao
But how do you do it though? How do you do it and who do you partner with to do it
- [36:25]
Ari (likely Arianna or Ari, interviewer)
and who's involved, obviously, Sam Altman, but
- [36:29]
Shiv Rao
who's a stakeholder for us? When we build new features that leverage data, we have a refrain in the company which is earn the right. So we always go back to our health system partners and oftentimes they know about our roadmap in advance and they've already already blessed it. And we've already papered this into the contract that we can build XYZ with the insights that we get so that we can improve the product or build other adjacent products that create whatever value. But building that foundation model is like we talked about it before, we do reach lower into the stack. We do train our own models and to some extent these models are the real workhorse for us. And so could we build a model that ends up serving that kind of function for the greater good? Absolutely. We would just want to do that, that with everybody's eyes wide open, all of our partners saying, let's go. We want that too. In this industry, it works. In this industry, people kind of get it.
- [37:22]
Ari (likely Arianna or Ari, interviewer)
You can have access to option A frontier models before anyone else for six months or option B, a talent pool of the best researchers and engineers for six months. Which would you rather B?
- [37:36]
Shiv Rao
No question about it. Because ultimately it's always about the people. And if you've got incredible people, you're going to build your own models, your own primitives, and yes, the frontier models you're going to be able to ride. But that arbitrage, that period of arbitrage, that's not the be all end all for us.
- [37:53]
Ari (likely Arianna or Ari, interviewer)
Is the talent marketplace as hard as everyone suggests it is?
- [37:57]
Shiv Rao
Yeah, yeah, absolutely. I think we have the benefit of being able to release a good amount of oxytocin for candidates. We're like a purpose company. We are a meaning company. You can be post money but still want to put your best years into this company. Because we're at scale and we're trying to do three things. We're trying to save time for the people who matter most in healthcare. We're trying to save money for the system. We need deflationary economics in healthcare, but we also want to save lives. You talked about the greater good. We want to help clinicians feel like superheroes. We have a feature, for example we just released where a doctor goes in. We give them cues on what questions they should ask or diagnoses they should consider. And we're doing it in a totally differentiated way. Unlike a lot of clinical decision support products out there, we're using context, we're engineering the context about who this Patient is that context comes from all those different systems of record and from the conversation.
- [38:50]
Ari (likely Arianna or Ari, interviewer)
With the greatest of respect, dude, if you're giving them prompts for questions and diagnoses, for goodness sake, just replace them.
- [38:58]
Shiv Rao
It depends. So every clinician, if a bot can do their job, I think most every clinician will say, what are you talking about? There was an American Journal of General Internal Medicine article that was published a few years ago that suggested that doctors need 30 hours a day to get all of their work done. So understandably, we've looked at the paper, we've parsed all the different tasks that lead to 30 hours and we're picking them off. We're creating these teams of assistants, of agents that can go and get all the pre charting done for the doctor before they walk in, tell them what questions to ask, help them create their note, do their billing. All the other things that we can do, we absolutely will try to do. At the same time though, I think like to your question, there's high frequency, low stakes care that absolutely needs to be automated. Right now in Utah for example, there's a bunch of controversy around companies being able to or starting to automate medication refills. Can AI automate prescription refills for a patient, that's as low stakes, high frequency as it gets. But it's those types of workflows that will progressively get automated till we get to some approximation of maybe the most boring variant of primary care that nobody wants to practice. But as soon as you get into the hard stuff, you talked about taste and judgment earlier. That's where I think things get very real. And that's where invoke Jeff Vaughn's paradox or whatever. But we're in for a tsunami of healthcare needs and the system is not prepared to deliver it.
- [40:24]
Ari (likely Arianna or Ari, interviewer)
Oh, I unwaveringly don't worry about like, oh, we're gonna fire doctors because we don't need them. That is the most ridiculous. Have you ever been to like an emergency room?
- [40:32]
Shiv Rao
There are people out there. There are people out there.
- [40:34]
Ari (likely Arianna or Ari, interviewer)
Yeah, yeah, I know. They need to go to an emergency
- [40:37]
Harry Stebbings
room on a Friday night and see the pains.
- [40:40]
Ari (likely Arianna or Ari, interviewer)
Goldman actually recently I was reading, weirdly I have like bedtime reading that I queue up every night. I need to get out more. I used to party, now I have bedtime reading where I save articles in the day and I was reading one last night and it said that there was an article by Goldman and essentially they estimate that agents within a 5 year period will increase token consumption by 24x. Very specific. 24x25 would be exaggerated. Do you think that is overplayed, underplayed or about right?
- [41:10]
Shiv Rao
I don't know about the specific number, but I think directionally, I think so. You just can't get enough of this technology. Once you start to use it, even as inference costs come down, you just end up using more and more and more of it. I think for certain jobs, especially the jobs that you'll never be good enough on, you know, those are bottomless pits. Now more than ever before, even reflected in the way people are organizing their companies these days, you can cover a lot more surface area. So just do that much more.
- [41:38]
Ari (likely Arianna or Ari, interviewer)
What's the hardest role to hire for today?
- [41:41]
Shiv Rao
I just think getting really amazing executives, really high judgment executives into a company like ours is critical. A part of it is because this is pretty unprecedented, this moment. Being able to have folks who can serve as guides, who have a lot of patterns that they can match against priors, but the right person who can kind of go against those priors but can kind of reflect upon them. The time between a decision and an action is getting compressed. Obviously product development, we do things differently now than we did a year ago. Even every layer of the company is getting compressed. And I think high judgment people, incredible executives is still a thing that I'm working on.
- [42:26]
Ari (likely Arianna or Ari, interviewer)
How do you think about. Brian Chesky obviously speaks about founder mode and the importance of getting as close to the bare metal as possible. How do you think back about that? On the one hand, with the need for execs pattern matching playbooks that you mentioned there.
- [42:39]
Shiv Rao
Yeah, I don't think they go together. I think founder mode is just about. To me it's about tours of duty. Depending on what's on fire inside the company or what's the most important thing and what you're best at, you just go crush. You just have to go kill whatever that challenge is. And it doesn't mean getting into the details and micromanaging everybody in the company. It means doing the Torah duty when to it comes. Makes sense. Jensen Nvidia is one of our investors and Jensen told me this. He once called me at midnight and it was like on his way home, cold call. And I knew it was him and I picked it up and it was. It was awesome.
- [43:11]
Ari (likely Arianna or Ari, interviewer)
Were you in bed?
- [43:12]
Shiv Rao
I was and I got up.
- [43:14]
Ari (likely Arianna or Ari, interviewer)
My darling Jensen, you are going to
- [43:17]
Harry Stebbings
flex even to your wi fi.
- [43:19]
Shiv Rao
That's actually what I said. That's exactly what I said. She was like whatever. I was like, hello Jensen. I'm like whispering to him. What did he say he was calling me back because of an email I had sent him. I'd sent him a two liner earlier in the day, so his SLAs are insane. He responds that fast. It's really wild. He wanted to unpack a challenge that I was experiencing. But one of the lessons for me that day was just, your job is to fall in love with whatever the job is. That is something you can do. You can convince yourself. You have to find a way to bend your DNA to crispr. New DNA in that. Loves living on airplanes. I live on airplanes now and I think if you caught me like five years ago, I'd be like, never. We're not going to do that. We're going to find other ways to grow and scale. But this is what the job requires and I enjoy it.
- [44:07]
Ari (likely Arianna or Ari, interviewer)
What have you not crispred your way into yet that you need to.
- [44:11]
Shiv Rao
Yeah, it's a good question. I'd say people's strengths are their weaknesses too. There's a shadow to what you're very, very good at. I have HR reporting to me. That kind of stuff is not the kind of stuff where I think, think I'm. I'm operating top of license.
- [44:27]
Ari (likely Arianna or Ari, interviewer)
I tweeted the other day that no great CEO ever liked hr. Yeah, I have never got so much hate back. I mean, really. Which is surprising. I thought that was why, like, you know, we all joke about like Karen in hr, but no, everyone's like, you know, you're a dick.
- [44:43]
Shiv Rao
I'm surprised by that.
- [44:44]
Ari (likely Arianna or Ari, interviewer)
Oh my God. Savage.
- [44:46]
Harry Stebbings
At that.
- [44:46]
Ari (likely Arianna or Ari, interviewer)
And then I said, listen, if you want to work from home on Friday, that's okay. But just accept that bluntly, you're not going to work as hard. You're going to go to Pilates at 10 and work from home. Fridays is bullshit. Four days a week. Are you five days a week in office?
- [45:00]
Shiv Rao
We are. Three days in office.
- [45:01]
Ari (likely Arianna or Ari, interviewer)
Huh? Why?
- [45:02]
Shiv Rao
We just have certain folks who have to travel long distances in order to get in the office. So we're still adjusting what exactly the sweet spot is.
- [45:10]
Ari (likely Arianna or Ari, interviewer)
Is that okay? Would you not rather have five days a week?
- [45:14]
Shiv Rao
I love being around the people. I love being at the whiteboards. But I'm also living on airplanes. But I just know how much especially EPD benefits. Everybody in the company, honestly, benefits. But this moment, things are moving so quickly that the more time that you have in person, the better. There's no question about it. I'm not a top down. We're not top down996, obviously, but we don't have that Kind of culture. And I think that there are a lot of people who are token maxing and it's Goodhart's law.
- [45:43]
Ari (likely Arianna or Ari, interviewer)
Do you worry at your size? You Malay into slowness, process policy. How many people do you have?
- [45:50]
Shiv Rao
450.
- [45:51]
Ari (likely Arianna or Ari, interviewer)
450. Is it possible to only have a players at 450? Honestly, it's a great question.
- [45:56]
Shiv Rao
I think so. And I think it takes everybody in the company continually looking at what their bar is and reassessing and making sure that everybody is.
- [46:05]
Ari (likely Arianna or Ari, interviewer)
When did you stop meeting everyone who joined?
- [46:08]
Shiv Rao
It's been a long time. It's been a long time. 100 even, probably even a little bit before that. Honestly, it was around then.
- [46:15]
Ari (likely Arianna or Ari, interviewer)
Is that right? And how would you advise other founders on how to.
- [46:18]
Shiv Rao
I don't think that there's any playbook, honestly. I think it depends on who's around you too. What executives around you who can do a lot of that work as well. I think culture is critical and no matter what the founder CEO thinks, they play a huge part in setting it. And there are a lot of different ways you can kind of convey what you believe is the culture that's going to help you win achieve your mission. And meeting every single candidate isn't necessarily in my estimation one of the. I think if you really trust your hiring managers and you really trust your executives as carriers of that culture, you can work it out.
- [46:51]
Ari (likely Arianna or Ari, interviewer)
What is the most non obvious but core cultural element that isn't standard? Everyone's like everyone. Ambitious people, people that care. Mission oriented, all that wonderful. One weird one for me is that it's called the Titanic rule. I mentioned Celine Dion earlier. We love Titanic here. Great movie. It's three hours long. Everyone should be able to go to a cinema with their family. But if you're asked a question on WhatsApp Slack, you need to respond within three fucking hours. It drives efficiency and urgency. Titanic rule. Yeah, anything that guides your principles. Less obvious special counterculture, you know, like
- [47:26]
Shiv Rao
the Josh Wolf from Lux. I remember years ago meeting him and I think he says this a lot, but chips on shoulders makes chips in pockets. I think that's. It's a hard thing to kind of be able to assess in a person. But there are just certain people who have insane slope and that slope is coming from something very, very deep in core to who they are. They're on a mission and you see them and you want to invest in them, you want stock in them and you just sort of feel it. So I think it's not that you're Looking for. There's a bunch of VCs out there looking for broken people. And we were talking about psychological assessments I think before we started and how some VCs will do that. And I had one before we took money from one of our investors. But I think it's just looking for a level of fire that's going to translate into not only those SLAs you talked about, but resilience and grind. And it's always wartime. And it's a different kind of war now than ever before. And not everybody's a warrior.
- [48:25]
Ari (likely Arianna or Ari, interviewer)
Are you a wartime or a peacetime CEO?
- [48:27]
Shiv Rao
Oh, come on.
- [48:28]
Ari (likely Arianna or Ari, interviewer)
Come on, you're a wartime CEO.
- [48:31]
Shiv Rao
You can't be. There's no other way to be. You're always competing. You're in a market that is moving so fast. Who's a peacetime CEO? Even the Costco CEO who I think is awesome and under celebrated. Is he a peacetime CEO? Maybe he is. Maybe he's a good peacetime CEO.
- [48:48]
Ari (likely Arianna or Ari, interviewer)
But the minute the founder transitions out of CEO role, I'm out. Do you agree with that?
- [48:53]
Shiv Rao
Yeah, definitely. I believe in those types of companies. Those are the types of companies I work.
- [48:58]
Ari (likely Arianna or Ari, interviewer)
What stage of a bridge development have you struggled most with? I always think product market fit is a series of chapters. We always get it wrong. It's like, oh, I had product market fit and then boom. You're constantly finding new product market fits. What chapter of company development did you find the most challenging to grapple with? And what do you know now?
- [49:18]
Shiv Rao
You know, honestly, like the chapter of company that sucks the most is like the one where you don't feel pressure. We have a saying in the company, pressure makes diamonds. When it feels somehow like you're on cruise control, you're on autopilot, that kind of sucks. If you're not figuring out how to 10x your ambitions, if you're not figuring out how to think outside the box or find new pockets to pull from new value to create. If you don't feel that pressure for some reason, if you're coasting, that doesn't feel good at all.
- [49:46]
Ari (likely Arianna or Ari, interviewer)
What's the largest round you've raised?
- [49:48]
Shiv Rao
Our Last one was 300 about a year ago.
- [49:51]
Ari (likely Arianna or Ari, interviewer)
When you raised 300 million. How do you prevent expenses and budget becoming too loose? It's a lot of money and I see it with a lot of companies where suddenly spending just becomes loose. Events, travel, hotels, da da da is loose. How do you prevent that?
- [50:10]
Shiv Rao
You hire really principled finance leaders who can work together with you to unpack what the goals of the company are and then recognize that, that against certain goals you don't want to blink. You raise this capital because it's a brute instrument now that is going to allow you to win. And so against certain things you just don't want to even debate. And if you are, you're doing it wrong. But having the right business minded folks and finance leader means that you should probably also have the discipline to know that you didn't need what I just ordered for our New York City office like some fancy speakers. But sometimes that stuff creates. Creates culture too. So yeah.
- [50:46]
Ari (likely Arianna or Ari, interviewer)
What was the hardest round to raise?
- [50:48]
Shiv Rao
The hardest round was a Series A1 venture capital. You obviously know it was a weak round. We were in a weak spot because there's a digit at the end of it.
- [50:57]
Ari (likely Arianna or Ari, interviewer)
A1 Terrible.
- [50:59]
Harry Stebbings
What the fuck is this?
- [51:00]
Shiv Rao
Yeah, obviously things are tough over there, but those first years we talked about the consumer product business models not feeling right.
- [51:07]
Ari (likely Arianna or Ari, interviewer)
Did you just get lots of nos?
- [51:09]
Shiv Rao
We got a handful of nos on that round for sure.
- [51:12]
Ari (likely Arianna or Ari, interviewer)
Does USV not just guarantee your next round?
- [51:15]
Shiv Rao
They did the seed and the A USV was our business model initially. We had other great investors like Bessemer and Pillar and plenty of others. But we were pre inflect and so we knew we could feel it.
- [51:27]
Ari (likely Arianna or Ari, interviewer)
So what was happening in that A1?
- [51:29]
Shiv Rao
Yeah, we found folks who believed and Whittington Ventures, for example, we did a round at a 2x. Folks believed that it was coming soon.
- [51:37]
Ari (likely Arianna or Ari, interviewer)
We got it like an 8 on 40.
- [51:39]
Shiv Rao
It was on a hunt.
- [51:40]
Ari (likely Arianna or Ari, interviewer)
Oh wow. That's pretty good.
- [51:41]
Shiv Rao
Yeah.
- [51:43]
Ari (likely Arianna or Ari, interviewer)
Well. Well, do you ever worry about becoming the jewel in a VC's portfolio?
- [51:47]
Shiv Rao
How so? What does that mean?
- [51:48]
Ari (likely Arianna or Ari, interviewer)
When a VC realizes that you're their kingmaker, all the pressure goes on you. Because if I've got a bridge in my seed fund, you are my multiple fund returner. You are the only one that matters now. My attention, pressure, focus, concentrates on you. It's kind of like the spotlight shining on the one that works.
- [52:07]
Shiv Rao
No, I don't think about it at all.
- [52:09]
Ari (likely Arianna or Ari, interviewer)
You don't think about that?
- [52:10]
Shiv Rao
No.
- [52:10]
Ari (likely Arianna or Ari, interviewer)
Do you notice the power transition changing from VC to founder, where suddenly you're invited to the agm, you're invited to speak at their event, you're invited to do their reference calls.
- [52:21]
Shiv Rao
Yeah, I think in 2023 we did like three LP meetings. That's when I knew things were going well. No, I don't think about it. I think we have a job to do. We're doing it. They're A part of it.
- [52:35]
Ari (likely Arianna or Ari, interviewer)
You have three children as well. I am always contemplating family. I think it's one of the most important things. Do you have any lessons for me on how to be a great CEO and how to be a great parent?
- [52:46]
Shiv Rao
I think that there's trade offs, there are sacrifices and the folks who say you can have everything are lying. You just have to be eyes wide open on what you're giving up. Also have to be eyes wide open on high level perspectives. Like I have a mentor who said just go to sleep at night thinking about ppg. Perspective, purpose and gratitude. The perspective I have is that this is what powers me. I have to do this work. And I also love my family and they come first. But sometimes there are trade offs and I can't be at the kid event. I live on the road. I'm traveling five days a week. I'm in San Francisco Monday, Tuesday, Wednesday and then I'm probably seeing customers and then Saturday and Sunday I'm with my wife and kids and I'm missing a lot. But it's just one of those things that you have to come to peace with. And recognize too that there are times of life and this is one of those. Remember when you know Luis Von Ahn?
- [53:41]
Ari (likely Arianna or Ari, interviewer)
Yeah, of course. I interviewed him.
- [53:43]
Shiv Rao
I Remember in his S1. He's from Pittsburgh as well. And also Union Square Ventures funded. And I'm sure that had something to do with USV being more comfortable with me because I certainly didn't have a track record ahead of that seed round. But he has that one line in the S1 about how the only thing you need to know is that I'm dedicating my life to this. On some level, I think my family are all dedicating a portion of our lives to this. And we're all eyes wide open on the sacrifices that we're making.
- [54:12]
Ari (likely Arianna or Ari, interviewer)
What are you not willing to miss? It's like for me, I walk a marathon every week with my mother on Saturdays. I'm not willing to miss that. I'll get the super, super late flight, but back Friday night I'll not go. I don't care. I'm not missing the Saturday morning. What is your I don't care. I'm not missing.
- [54:27]
Shiv Rao
Yeah, Sunday with my dad and my mom. Big part of the reason that we're still in Pittsburgh, honestly, although I try to convince my 15 year old daughter to move to SF recently, it didn't work. But I think we're on the field. But a big part of the reason we're anchored There is aging parents, my dad has heart failure, I get to see them and I get to bring the kids to them and it's the highlight of their week and I get to do that every week. I'm happy to live on airplanes to make that happen. So that's the thing I'm not willing to give up. And it's an incredible opportunity privilege that I get to do it.
- [54:59]
Ari (likely Arianna or Ari, interviewer)
Final one before we do a quick file. I think San Francisco is the worst place to start a company because it is so impossible to acquire and retain talent as a startup. Think 5 million seed funding going up against your abridges on the 300 million leaders and the OpenAI's and Anthropopis. Do you agree or am I short sighted and wrong?
- [55:19]
Shiv Rao
There are so many cracked early stage teams over there and the reason why I don't agree is this moment is so insane. You know, like the amount of people, the amount of ideas, the amount of creativity, the amount of energy right now that's concentrated in that area, it's just wild. We went against the grain when we started. We started a lot of Carnegie Mellon DNA. We started in Pittsburgh, we built in Pittsburgh for years. And then I think with this AI moment it just became so clear that we had to move in 2022, 2023.
- [55:52]
Ari (likely Arianna or Ari, interviewer)
Should you have moved earlier?
- [55:54]
Shiv Rao
No, we did it exactly at the right time. As we were inflecting, we just needed to be in that moment. And the amount of ideas that you just osmotically absorbed by being there, the kind of talent that you have access to, the kind of mentorship that you have access to, I think it's super important.
- [56:11]
Ari (likely Arianna or Ari, interviewer)
I'd love to do a quick fire because I could talk to you all day. What have you changed your mind on in the last 12 months?
- [56:17]
Shiv Rao
Yeah, I've changed my mind on how a company can operate, how it should be built, how flat it can be. And anymore I'm in this very idealistic mode that we can be a very, very flat company in the near future.
- [56:30]
Ari (likely Arianna or Ari, interviewer)
What does that actually mean in reality?
- [56:32]
Shiv Rao
Just like less managers, a lot more ICs. Super ICs taking on that much more. Everybody with these tools able to move in lockstep and able to be coordinated in a way that was impossible before.
- [56:46]
Ari (likely Arianna or Ari, interviewer)
I tweeted the other day that my single biggest advice to a graduate is to be full stack. If you're a marketer, be the one who creates the copy, edits the video. 100% yeah, super icy.
- [56:56]
Shiv Rao
Totally agree.
- [56:57]
Ari (likely Arianna or Ari, interviewer)
What's the kindest thing anyone's ever done
- [56:59]
Shiv Rao
for you because we're talking about venture and raising. I would say that one of the most generous things, maybe not kindest, but the most generous things in reflection, was people betting on me early when I had nothing really to show for it.
- [57:16]
Ari (likely Arianna or Ari, interviewer)
Is kingmaking real in terms of an investor brand denoting a winner in a space?
- [57:22]
Shiv Rao
It's less the brand, it's more the placebo effect, it's more the psychology. The more you can feel inevitable, the more you will be. And I think when you're able to spend time with folks who you really admire, who've got incredible track records, when they bet on you, that just sort of starts to seep into your psyche.
- [57:41]
Ari (likely Arianna or Ari, interviewer)
Do you feel inevitable now?
- [57:43]
Shiv Rao
I feel our mission is absolutely inevitable. And I think we're in a war to make sure that we're the ones that we make it happen. But on some time horizon, it's absolutely inevitable. Making healthcare cheaper, better, faster. But we're at war to make sure that we're the ones to do it. And we do it in the next two to three years.
- [57:58]
Ari (likely Arianna or Ari, interviewer)
I know Abridged is your mission for life. You start a new company, you can only take one ambassador with you. Who do you take with you?
- [58:05]
Shiv Rao
If I started a new company right now, I would call Ilad Gil. We'd go big, single gp. All of the wisdom in his head, all that I've learned from him, his ability to go every stage and be incredibly valuable.
- [58:20]
Ari (likely Arianna or Ari, interviewer)
What's your biggest lesson from A lot.
- [58:22]
Shiv Rao
So many lessons. I always feel somewhat just like a pupil with him. I just want to learn. But recently we've spent time over the last year talking about corp dev. His lessons learned from his days at Twitter and how do you do that effectively and how to think about corp dev and how aggressive you should really be if you decide you're going to do it. How you need to have people just fully focused. That needs to be their entire job. You can't split people's brains on it. If you're going to do it, you got to be binary. Learned a lot, but there's lessons like that that always come out of him.
- [58:52]
Ari (likely Arianna or Ari, interviewer)
Who do you think is the most underappreciated CEO today?
- [58:55]
Shiv Rao
That's a good question, honestly, because we talked about that Costco CEO. I think it's that guy. What's his name? Ron something. I think he's a guy who went from the forklift to the executive office all the way up. He's a lifer over there. He carries the torch of culture and he's managed to continue to grow a business that obviously he inherited or he was already awesome. But they've only had what, three or four CEOs. That's one of those businesses that you don't read about enough. I think that is absolutely amazing. Obviously I have my idols. I have people like Ali Gadzi, who I think is an absolute legend in the way he plays chess and navigates his market. And I just try to learn as much from his side outside in. But that guy I think is pretty awesome too.
- [59:41]
Ari (likely Arianna or Ari, interviewer)
Final one for you. When you look at the next 10 years, what are you most excited for?
- [59:45]
Shiv Rao
Where I'm focused right now is healthcare. That's all I live and breathe. That's all I think about healthcare. It's just an absolutely messed up market. You remember that XKCD from years ago? I think it was where it was about Conway's law. You build what you look like. And they had Apple there and it was concentric circles before their headquarters. There was Google, it looked like a neural network, there was Facebook, looked like a graph, maybe there was Microsoft. And it looked like silos pointing guns at each other. And that's what healthcare is in the United States. It's providers, health systems, pointing guns and getting pointed at by insurance companies. And then there's also life sciences companies. And those three stakeholders in some way, shape or form are misaligned. And they're not only misaligned with each other, they're misaligned with the people who matter most. The patient, the person. And the opportunity that we've got right now with AI is, is not to deploy the latest model and make science fiction happen in a clinic. It's to change the business model. And this technology is going to do it. It's doing it right now. And we're going to see that on both ends of the spectrum. We're going to see to your point earlier, we're going to see a lot of AI doctors, we're going to see a lot of automation, of high frequency, low stakes workflows. But then on that enterprise, that healthcare system, when you get really sick, you're still going to want to see an expert, Bert. We're going to see new models that actually align folks and incent prevention. Prevention meaning care and not healthcare, not sick care. So I think that's what I'm most obsessed with right now and I don't think it's even a ten year horizon. I think we'll start to see the beginnings of that in the next three to five.
- [61:23]
Ari (likely Arianna or Ari, interviewer)
Listen, this has been such a joy to do. Thank you so much for doing it in person. It makes it so much more special. And for putting up with my meandering around.
- [61:31]
Shiv Rao
Amazing. Thank you Harry. It's a privilege.
- [61:34]
Harry Stebbings
But before we leave you today, here's a question for any founder listening what would your marketing team do with an extra 30 hours a week? That's roughly what teams get back when they stop manually building every campaign, every workflow, every email. Right now, your best marketing people are spending their days cloning templates, configuring audience segments, and chasing data across systems. That's not not what you hired them for. Qonversion is the first marketing automation platform where AI agents handle the execution. Your team focuses on strategy, on messaging and pipeline. The agents handle the rest, building campaigns, personalizing every touchpoint per account, and deciding the next best action automatically. Whether that's pinging your ae, launching a retargeting sequence, or dropping someone into a nurture, the agents figure it out. And that's why over 44,000 B2B companies have already made the switch, including People, Data Labs and Adaptive Security. So head on over to conversion AI20VC and get $10,000 off. That's conversion AI20VC for $10,000 off conversion. After Granola captures the conversation, Artisan helps start the next one. Meet Ava, the first autonomous AI BDR built by Artisan to run your entire outbound on autopilot.
- [62:50]
Jason Lemkin
Hey Jason Lebkin from Saster here. Artisan is S tier. We replaced our entire outbound sales team with Artisan. I believe We've sent over 50,000 highly customized emails to Artisan. The open rate is twice what it was with humans and they close 100k deals day after day.
- [63:05]
Harry Stebbings
AVA sources leads from over 250 million contacts, enriches every prospect with intense signals, then writes and sends personalized multi channel outreach self optimizing over time. When a lead replies, she handles objections and books meetings straight into your AES calendars without any human interactions input. Artisan is backed by Y Combinator and has raised $36 million to build the first truly autonomous AI BDR. Hire Ava the AI BDR and put your outbound on autopilot at Artisan Co20VC. That's a R T I S A N CO20VC. And speaking of great companies, we have to talk about Monaco. For years I've watched some of the best founders and early go to market teams struggle with sales. Too many CRM CRMs, too many point solutions, too much manual work. Well that changes with Monaco. Monaco replaces your legacy CRM and fragmented sales stack. With a single AI native platform, Monaco's agents automatically build and score your entire tam lay it in real time signals, create and run outbound sequences, schedule calls and record and transcribe meetings. Your pipeline practically manages itself. Monaco creates reminders, drafts, follow up emails, feedback and keeps deals moving forward. So that means more meetings, higher conversion rates and faster revenue growth. If you're an early stage startup tired of duct taping sales tools together and looking to grow revenue faster, check out monaco@monaco.com.