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Akin Babayigit: How Tripledot Studios Became #1 Fastest-Growing Company in Europe | E1030

Akin Babayigit is a serial entrepreneur and an active angel investor. He is currently the Founder and COO of Tripledot Studios, one of the fastest-growing mobile gaming companies in the world, which was recently valued at over $1.4BN. In just 4 years, Tripledot grew to generate several hundred million dollars per year in revenue and currently entertains over 50 million people every month. Tripledot was recently named as the #1 fastest-growing European company by FT, as well as being named as the fastest-growing Tech business in the UK, in the annual “UK Tech Awards”. ---------------------------------- Timestamps: 0:00 Intro 1:17 Akin’s Journey — From Turkey to Harvard Business School 6:40 Lessons Learned at Skype 9:15 How Akin Went to Facebook 11:47 Lessons Learned at Facebook 20:56 Startup Myth #1 — You Have to be Passionate About Your Domain 28:47 Speed of Execution 30:00 Two Russian Brothers Who Dominate Mobile Games 35:20 Startup Myth #2 — Your Life is Going To Suck 43:41 Startup Myth #3 — Focus is Everything 50:28 Building Company Culture 56:30 Hiring Tips & Advice 1:03:49 Startup Myth #4 — Valuations Do Not Matter 1:10:29 How UK Politics Can Promote Startup Innovation 1:17:00 Misconceptions About the Gaming Industry 1:27:51 The Rise of Subway Surfers 1:32:17 Quick-Fire Round ---------------------------------- In Today’s Episode with Akin Babayigit We Discuss: Entry into the World of Startups and Gaming: How Akin made his way from Turkey to HBS and founding a unicorn in Tripledot? How did the lack of a father figure impact Akin’s approach to parenting? What are 1-2 of Akin’s biggest takeaways from his time at Facebook, Skype and King.com? What advice would Akin give to all new joiners at a company today? 90% of Startup Advice is Total BS: BS Myth #1: “You have to be passionate about your domain”. Why does Akin disagree with this? If you do not have passion for the domain, what do you have to have? BS Myth #2: “You have to be solving a real problem”. Why does Akin disagree with this mantra? If you are not solving a real problem, what should you be solving? BS Myth #3: “When you do a startup, your life will suck for a long period of time”. Why does Akin strongly disagree with this? Does it get easier over time? What does Akin advise founders to make the earlier days easier? BS Myth #4: “Focus is everything. You should focus on a single thing and only do that.” Why does Akin believe that focus can be dangerous? How should founders know when to pivot vs when to keep going? BS Myth #5: “Mission and vision statements are so important.” Why does Akin believe that the majority of mission statements are BS? Is it worth having them at all? BS Myth #6: “You should hire people with domain experience.” Why does Akin believe you should hire people who do not have domain experience? What does Akin look for in these candidates? What have been his biggest hiring mistakes? How has his hiring changed over time? BS Myth #7: “Speed is the most important thing.” Why does Akin believe that speed can be dangerous? When is it right to go fast vs go slow? BS Myth #8: “Valuations matter and you should optimize.” Why does Akin believe that valuations do not matter in the long run? How should founders approach the valuation discussion with this in mind? ---------------------------------- Subscribe on Spotify: https://open.spotify.com/show/3j2KMcZTtgTNBKwtZBMHvl?si=85bc9196860e4466 Subscribe on Apple Podcasts: https://podcasts.apple.com/us/podcast/the-twenty-minute-vc-20vc-venture-capital-startup/id958230465 Follow Harry Stebbings on Twitter: https://twitter.com/HarryStebbings Follow Akin Babayigit on Twitter: https://twitter.com/akinbabayigit Follow 20VC on Instagram: https://www.instagram.com/20vc_reels Follow 20VC on TikTok: https://www.tiktok.com/@20vc_tok Visit our Website: https://www.20vc.com Subscribe to our Newsletter: https://www.thetwentyminutevc.com/contact ---------------------------------- #AkinBabayigit #TripledotStudios #HarryStebbings

Akin BabayigitguestHarry Stebbingshost
Jun 26, 20231h 52mWatch on YouTube ↗

EVERY SPOKEN WORD

  1. 0:00 – 1:17

    Intro

    1. AB

      I mean, the size is just comical. I mean, like, you know, there's a lot of things you listen to around saying, like, gaming is bigger than movies and films combined, right? That's a very real thing. But even then, you know, people misunderstand how big gaming is.

    2. HS

      (instrumental music) Ekin, I am so excited for this, my friend. We've known each other for a while. I'm so thrilled that you took the time to join me, so thank you so much.

    3. AB

      Man, it's such a privilege. It's an honor. I do have to say, you know, first of all, on a personal level, I really love you. Really. On a professional level, I think most people don't know, but, uh, we have an amazing professional relationship. You're an investor in our business as well. And we'll talk about kind of startup advice and all of that, but most people don't know you're actually a media entrepreneur, not just any VC. For me, it's such an amazing privilege to be here. You're one of the very few people I tell my kids about at dinner table. I say, "You know, Uncle Harry did this." You know, "I want you to do this like Uncle Harry when they were ..." And it's not me blowing smoke up your ass. This is really legitimate, and I'm really, really happy to be here.

    4. HS

      I mean, poor kids. Uh, one-

    5. AB

      (laughs)

    6. HS

      ... (laughs) and then that, and that will lead to Wandsworth Prison. Uh, but, uh, no, it's funny. I always say when I think about you and Leo, uh, these are the founders where whatever they were doing, it could be selling kitchen knives, you just wanna give them all of your money.

  2. 1:17 – 6:40

    Akin’s Journey — From Turkey to Harvard Business School

    1. HS

      (laughs)

    2. AB

      (laughs)

    3. HS

      But no, I was, uh, talking to JZ before the show and he gave me this very apt description of Turkish Muslim-

    4. AB

      (laughs)

    5. HS

      ... sent by your mother, not by the government.

    6. AB

      Yes.

    7. HS

      Yale HBS. Give me the snapshot. Like, how did that happen?

    8. AB

      Sure. So, um, I grew up in Turkey, uh, until I was 16, and I was this mega nerd. I was in, like, the math Olympiad team, and I was just, I was one of those people that, um, I was social, but I wasn't, um, you know, externally facing, externally friendly. My mother, um, came in one day, and my mother is not for the faint of heart, and she said, "I decided to put you on a exam for the Rotary Club to go to the US." And I protested and I said, "I don't want to. I'm happy here in Turkey." And, and she came and she said, "Fine, you can be a garbageman then." And that was the end of discussion. So next thing I knew, I was in a exam room, uh, with the Rotary Club. I went to the US, into Wisconsin. And you took a math nerd from Turkey, put them in Tomah, Wisconsin, uh, where not only people did not see anybody from anywhere else, people never saw anyone with dark hair.

    9. HS

      (laughs)

    10. AB

      That was an incredible experience. I was the outsider, and that was a very defining moment for me. If I made it in Tomah, uh, you know, I could make it anywhere. So I, uh, stayed on in Wisconsin. I love Wisconsin. I love the US. Met my wife in university, uh, in Wisconsin, studied there. Um, went to graduate school. I was... I thought I wanted to become a professor. Uh, absolutely horrible idea for me.

    11. HS

      (laughs)

    12. AB

      Um, and, uh, just like what most people don't, you know... Most people that do consulting don't know what they wanna do with their life. That was me. I had no idea what I wanted to do with my life at that point. Uh, decided to just stop graduate school, left Yale, went to McKinsey, spent two years at McKinsey. I absolutely hated it. Um-

    13. HS

      (laughs) Why did you hate it?

    14. AB

      It was a very rigid environment intellectually. There was a way to do things, and, uh, if you didn't do things that way, you would fail, right? And at the time, I couldn't articulate it, but I, you know, wasn't the c- type of person that would, um, you know, necessarily follow the rules. I wouldn't kind of do the way they wanted me to do the analysis and so on and so forth. But the analysis I did was correct, but, you know... So I couldn't just bring myself to act a certain way and, and just kind of, uh, think the McKinsey way. I thought a little bit different, and that made me, you know, not a very strong performer. Initially, I was a very strong performer. Towards the end, I was, you know, not a very good performer at all.

    15. HS

      (laughs)

    16. AB

      So I then left and I went to, uh, work for the United Nations for a couple years.

    17. HS

      (laughs)

    18. AB

      And that was awesome, right? That was a great experience, um, except, you know, I realized quickly there's not much money to be made there.

    19. HS

      (laughs)

    20. AB

      So then I decided to learn more about the world and this thing called business. I went to Harvard Business School. Um, and that was a very interesting experience. Um-

    21. HS

      Was it transformational for you?

    22. AB

      It was in many ways, in the good way and the bad way as well. Um-

    23. HS

      What was the good and the bad way?

    24. AB

      So HBS was a place where I, um, I struggled a lot to fit in initially, because there's, uh, definitely, um, a lot of, um, you know... There's an HBS way of doing things again, right? There's... And, and there's a group of people who are, you know, you can smell them a mile away. They're the HBS people, right? And initially, the first year, I really tried to fit in with that crowd. And, um-

    25. HS

      You're not that crowd. (laughs)

    26. AB

      I'm not that crowd. (laughs)

    27. HS

      (laughs)

    28. AB

      I'm not that crowd, right? So then I realized actually, it's okay. And I tell this to, to my daughter and to my son all the time. It's like, it's okay to not fit into that crowd as long as, you know, you make your own kind of friendships and your own circle. So the second year I did much better. I actually kind of was okay. I was at, you know, peace with not kind of fitting in, um, and I was just much more happier. Um, so I think a lot of the people that I met... So HBS has a- around 900 kids every year. And it was transformative for me, not because of the things I've learned, 'cause I didn't learn much. But I did learn by talking to people what they are, you know, w- what they do, who they are, what gets them motivated. And I learned through those conversations a lot about the, you know, business world, how people think, what drives them, what motivates them.

    29. HS

      Sure.

    30. AB

      That to me was very transformative. And, you know, the friendships that you form at HBS, they, you take them with you for life.

  3. 6:40 – 9:15

    Lessons Learned at Skype

    1. AB

    2. HS

      Can I ask-

    3. AB

      Yeah.

    4. HS

      ... what did you learn from Skype and your time at Skype that you now apply or have taken with you to managing and leading at Tripledot?

    5. AB

      I learned how to ruthlessly prioritize. So, Skype was a very small company. At its peak, I think it was about 300, 400 people, um, and it was dominating the v- voice over IP market and it could've dominated so much more. Um, and, you know, I mean, it was spun off from eBay, acquired by this investor consortium, sold it to Microsoft for, I think, $8.1 billion. And Skype was an engineering-led organization, and being engineering-led, you know, there's no room for fluff. And I developed a very strong, I would say, distaste for fluff while I was at Skype, um, and that really forced me... When you're talking with an Estonian engineer about the, you know, total addressable market or what's Skype's position in it, et cetera, you learn very quickly to get to the heart of the matter very, very fast.

    6. HS

      Can I... I s-

    7. AB

      Yes.

    8. HS

      I struggle with this 'cause I similarly have a distaste for fluff. But when I come in and say, "Hey, forget all the bullshit. Like, just show me last week's performance," n- people are like, "Harry, that, that was too cold. It was jarring."

    9. AB

      Yes.

    10. HS

      "And actually, you need to be m- warmer."

    11. AB

      Sure.

    12. HS

      And I struggle with the balance. How do you retain that humanity with-

    13. AB

      Sure.

    14. HS

      ... kinda, "Let's get to the card of the problem"?

    15. AB

      A lot of it has to do with my personal style, and I think... So, uh, first of all, I'd be very surprised if you are as cold as you just made it out to be. I think you mean well, and anyone that knows you knows that you mean well. And the same, anyone that knows me knows I mean super well. I mean, I, you know... One of the things you told me earlier was that I'm too nice.

    16. HS

      Yeah.

    17. AB

      And, um, that is probably true, and I lean into that because I am a nice person, and I am not an asshole.

    18. HS

      (laughs)

    19. AB

      And when I am saying something, uh, let's say, "Let's talk about last week's numbers," people know it's me just really wanting to get to the core of the matter. I have almost zero ego, and you know, so I think it's just this, you know... I hope people know what I mean when I say, "Let's talk about the bad performance last week," or so on. And I think d- a lot of this I learned at Skype, and this was done via many, many, many interactions with very apt Estonian engineers. (laughs) You know, that was, that was just something that was, uh ... yeah.

    20. HS

      So, we take this, uh, concision or focus or prioritization.

  4. 9:15 – 11:47

    How Akin Went to Facebook

    1. HS

      Uh, tell me, then we move to Facebook?

    2. AB

      Yes. So, um, actually, in between, when I was at Skype, I was presented with this world of mobile gaming. So, you know, I'm not a gamer. I don't have a console at home, but I learned about this game called Zynga's FarmVille back at the time. And-

    3. HS

      I loved FarmVille.

    4. AB

      Isn't that amazing?

    5. HS

      Oh, my God. It was amazing.

    6. AB

      It's still around, right?

    7. HS

      I, I, I didn't know it was still around. (laughs)

    8. AB

      It's, it's... There's, like, FarmVille 3 now. It's, it's amazing.

    9. HS

      Does it still make money?

    10. AB

      It still makes money. It's not as big as it once was-

    11. HS

      Sure.

    12. AB

      ... you know? But the thing that was absolutely amazing at the time, I read a statistic somewhere that there was more tractors being sold in a day on FarmVille than anywhere else in the world combined. And now, it seems like almost, like, a foregone conclusion, but back then, it blew my mind. And I started to get into it a little bit more and actually started playing it myself, and it was very different in terms of a game design philosophy. You know, the games that I knew, you would play for an hour a day, uh, continuously, and you'd be done with it, and you'd go do your homework. This was, I kept coming back every 30 seconds, and, you know, whatever it was, and just trying to do something in the game. And that element of understanding the psychology behind that actually made me interview at Zynga, and this was in 2010, and back then, I was told the culture at Zynga was not very good. I had classmates from HBS who were working there, so I ended up not taking that job. But I got bitten by the gaming bug, effectively. Um-

    13. HS

      And then joined Facebook?

    14. AB

      Yeah. So I went, and I, I flirted with the idea of going to Turkey at the time 'cause my wife, who is, by the way, the most absolutely incredible woman I've ever met in my life, she is irrationally attached to her family. So, she said, "Let's go be closer to our families." And at the time, Turkey was growing in popularity as a destination. I had many g- good friends who started businesses in Turkey and said, "Let's go see what this Turkey thing is about." So, I, for a couple of months, I actually joined, uh, this company called Peak Games out of Istanbul-

    15. HS

      Yeah.

    16. AB

      ... as an advisor. And, uh, that... And they were making Facebook games at the time, and through that, I met Julien, our common friend, and joined Facebook-

    17. HS

      (laughs)

    18. AB

      ... and, uh, decided not to move to Turkey at the end and instead came to London.

    19. HS

      So, I'm sure Julien was fishing here, but he asked, when you review the time that you had at Facebook, it was such a transformative time for the company and for you, I'm sure.

  5. 11:47 – 20:56

    Lessons Learned at Facebook

    1. HS

      What were some of your biggest takeaways from being at Facebook?

    2. AB

      Yes.Facebook was an incredible place. I mean, I, um, I really absolutely loved being- spending time there. And I think my Facebook experience probably is very different than a lot of people's Facebook experience because, because I was in London. London felt like an, you know, a startup within Facebook at the time. And a lot of that credit goes to Julian who was, like, the best boss I ever had, right? And he was awesome, and, you know, I still owe everything I've done to this day to him and he'll, he'll c- call m- He'll say I'm bullshitting, but it's true.

    3. HS

      (laughs)

    4. AB

      Um, and the biggest thing I learned at Facebook actually is things are never as bad as they seem and never as good as they seem. So it's a very stoic thing to think about and this I actually heard in a all hands with Mark. Um, and when I joined Facebook, you know, uh, it was 2012 and soon after Facebook launched the, uh, their mobile offering, right? Because they were getting really heavily criticized about they don't have a presence on mobile, they missed the boat on mobile.

    5. HS

      Sure, it was one of the reasons for their IPO tanking.

    6. AB

      Exactly. It opened at, I think, 38 bucks, went down to 19 bucks. My wife said, "Hey, are you sure that you did the right thing by joining?" And I was like, "I actually don't know, but I think so." And I remember Mark being extremely calm and actually almost in a way confident and that to me at the time seemed a bit wrong almost because, uh, you know. And when I came to the kind of the ground floor, I understood that he believed in what they could do, uh, as a mobile offering, right? And the people were just spending insane amount of time on their mobile devices in Facebook at the time and Facebook invented a new type of ad unit, um, called the mobile app- uh, mobile ads at the time, but really it was mobile app ads. And, uh, fast forward to this day is 90+ percent of Facebook's revenue is, is coming from that. So, um, I remember how calm Mark was and, uh, you know, he did say, "Things are never as bad as they seem. They're never a- as good as they seem." And I, I s- that's the one thing I learned, you know. When things are going, you know, absolutely horrendously, you know, I try to stay as calm as possible and when things are going, you know, incredibly well and so on, I try to bring w- a sense of realism and, you know.

    7. HS

      It's a really interesting kind of element of my investing that's actually changed, which is, like, I always used to love young founders.

    8. AB

      Yes.

    9. HS

      And the truth is with young founders, they're much more volatile to swings, good and bad.

    10. AB

      Yes. Yes.

    11. HS

      And I find actually with, respectfully, older founders, ahem-

    12. AB

      (clears throat) (laughs)

    13. HS

      ... uh, that you're just much more tempered.

    14. AB

      Yes.

    15. HS

      Good, bad, you know that actually what matters is your child's health, what matters is the family that you have at home.

    16. AB

      Yes.

    17. HS

      A day of performance on Facebook doesn't actually matter.

    18. AB

      Exactly. That's such a good point because it will all be okay. We will all be okay at the end of the day. Um, there are times when, you know, you have to act and you have to act with, you know, uh, gusto and you have to kind of, uh, you know, fight.

    19. HS

      What was one of those times at Facebook when you had to act with gusto?

    20. AB

      Oh, there were so many. Um-

    21. HS

      Was there ever a time when it was as bad as it seemed?

    22. AB

      So I do remember, um, when we launched app ads originally, and this'll sound comical, but, you know, obviously, it was not, you know, it was not a foregone conclusion that those ads would work because they are a new ad format, they're native ads. And when we launched those, um, I got so excited that I went and kind of told all the partners that were working with Facebook at the time about this amazing thing and so on. I remember all my partners being extremely frustrated that these ads weren't ... 'cause they- it took them, you know, six to nine months to figure out. I remember there was a famous bug on Facebook Android that just, you know, these ads weren't delivering and there was something wrong. Um, and that moment I remember thinking it is, you know, this may not work because it's just, you know, the performance of the ads were not there and all my partners were pretty frustrated with the performance and so on and I thought maybe it's not gonna work y- you know. There was somebody that discovered a bug in Menlo Park, I can't remember exactly who it was, whatever, but, um, it was a step function change. Over a week, these ads started delivering and, you know, it's ... And fast forward, I think there was a period of time when I think 35% of Facebook's mobile revenue was coming from, like, three developers in Russia at the time, which is absolutely incredible, right? This is how hungry they were for this kind of, uh, offering. And, and, you know, they were game developers and game developers are always very hungry to adopt new things that might be game changers.

    23. HS

      Please, dear God, tell me you hired them for Tripledot. (laughs)

    24. AB

      (laughs)

    25. HS

      Uh, okay. Before we dive into the meat of the show, so we have that amazing experience at Facebook.

    26. AB

      Yes.

    27. HS

      Tripledot founding.

    28. AB

      Yes.

    29. HS

      What was that, "You know what, darling? I'm gonna leave the well-paid job at Facebook and I'm gonna found a game studio in London with my mate, Liel."

    30. AB

      Yes.

  6. 20:56 – 28:47

    Startup Myth #1 — You Have to be Passionate About Your Domain

    1. HS

      No, I love that. So, you mentioned, um, kind of the startup porn or mantras that we hear.

    2. AB

      Yes.

    3. HS

      You gave me quite a few before we, uh, did this-

    4. AB

      (laughs)

    5. HS

      ... and I love them. Uh, and so I wanna start with one, and, uh, (laughs) it's the idea that you have to be passionate about essentially your domain that you pursue.

    6. AB

      Yes.

    7. HS

      Uh, you have to choose something that you love, and you say that's not true.

    8. AB

      It's... I mean, I think it's absolute bullsh- bullshit. Uh, excuse my French, but-

    9. HS

      Why is that?

    10. AB

      So, I have many friends, successful entrepreneurs, and some of them, actually one of them lives in Canada, and he is in the insurance space. And I can guarantee you he's not passionate about the insurance space. I've never met a single person who is passionate about the domain of insurance. Maybe you might have, but I haven't.

    11. HS

      Terribly boring. I'm-

    12. AB

      It's horrible, right?

    13. HS

      ... so bored by insurance... (laughs)

    14. AB

      And, uh, so that's just not, you know, that's just not true. He's very successful. The business is very successful. Um, I'm the living example of this. I think, you know, Triple Doll- Triple, uh, Dot is a company that's doing quite well, um, but I'm not a gamer by definition. Now, it depends on what you mean by gamer. But any kind of definition you have, you know, I am not a hardcore gamer. I do like games. I like the business of games. I like the philosophy of games, but I'm, I'm not a gamer. I am passionate about winning, and I think that's the biggest difference, because I think, you know, I invest in a lot of companies as mi- myself as well. And I think the thing that people, you know, like, I guess, working with me is, you know, I, I don't have this incentive to, um, tell people, give people this startup porn advice, right? I say, you know... So, and there's a lot of them out there. Um, so, I think being passionate about the domain that you're in is great. It's a luxury. It's not a must to have.

    15. HS

      I think a lot of people say if you're not passionate about it, and I, I agree with you there, but I, I think a lot of people say if you're not passionate about it, when the hard times come and it's a bad day, you'll give up.

    16. AB

      Yeah.

    17. HS

      How do you respond to that?

    18. AB

      I think you have to be passionate about winning. I think... An- we're all wired differently, right? If you're passionate about winning, when the hard c- hard times do come, and they will come-

    19. HS

      Yep.

    20. AB

      ... in anything in life, then you need this...... engine, internal engine to propel you through. But that passion doesn't have to be directed to the domain, you know? I think it's a very Western-centric view of the world to think that you have to be, you know, passionate about the domain that you're in, and I think that ends up actually in quite dangerous territory because a lot of people who are passionate for winning, who are just, you know, hard learners, w- hard workers and learners, they end up not pursuing perfectly good lucrative jobs, um, because of this kind of advice.

    21. HS

      Sure.

    22. AB

      Uh, don't get me wrong. If you're one of the few people that have, you know... Like, Eyal is a great example, right? Like, Eyal was born to be in the gaming industry.

    23. HS

      Uh-huh.

    24. AB

      You know, if I saw him doing anything else, I would forcefully take him out of there and then put him in the game industry. But that's, that's a luxury. That's not the rule.

    25. HS

      I, I, I don't know if you've actually seen the studies on post-baby effects, and it analyzes entrepreneurs post having a baby, either man or woman-

    26. AB

      Mm-hmm.

    27. HS

      ... but actually, they are, like, significantly higher likelihood to be successful. I think it goes back to your thing. They might not be passionate, but actually, you have the passion to succeed-

    28. AB

      Yeah.

    29. HS

      ... for your child's welfare, for their life to come.

    30. AB

      I think-

  7. 28:47 – 30:00

    Speed of Execution

    1. HS

      many things to unpack. You said there about kind of the iterative element.

    2. AB

      Yes.

    3. HS

      I always believed, and especially pre-product market fit, when I look at my seed investments, the biggest determinant of whether they reach or not is their speed of execution.

    4. AB

      Yes.

    5. HS

      Their speed of, like, in between-

    6. AB

      Yes.

    7. HS

      ... iterations.

    8. AB

      Yes.

    9. HS

      Do you agree with that focus on speed and speed of execution?

    10. AB

      Broadly speaking, yes. This is not something that, uh, you know, I have, um... I can't say that, you know... Like, speed is very important, right? But the porn around speed is something that I'm uncomfortable with because...... speed of execution allows you to do more iterations than others.

    11. HS

      Yep.

    12. AB

      Right? But there are points that this is a road, and the road has curves. And you know what? When you're approaching those curves, sometimes you have to just slow down and actually think and take your time. So, I've seen, you know, many, many companies in Turkey, also in Israel, uh, where I also do quite a bit of investing, that, you know, they have this mantra and they put it on the walls and say, you know, speed over all, speed above everything else. And sometimes, just sometimes, they are too fast when they approach one of those curves and they go off the cliff. Um, at Facebook we had,

  8. 30:00 – 35:20

    Two Russian Brothers Who Dominate Mobile Games

    1. AB

      um, these posters, right? They said, "Done is better than perfect." And then, I agree with that in general, in spirit, but when you go over to finance, they said, "Done is better than perfect, except in finance."

    2. HS

      (laughs)

    3. AB

      Sometimes done is just more important. And the perfect example in gaming for this is there's, um, two brothers, um, called Ig- Igor and Dmitry. They're probably the best kept secret in mobile gaming, uh, Playrix. They-

    4. HS

      I've heard about these guys. Tell me about these guys.

    5. AB

      It is an absolutely incredible story. They are two brothers who started building... They're from, uh, Vologda, Russia, right? Middle of nowhere. They started building games. Initially, they started building games for... They were, um, pay-to-play games, not even free-to-play, which was the revolution in gaming. I met them in 2013 in Moscow when I was working at Facebook. Um, they... When I told everyone about, you know, like, mobile games, free-to-play, everyone jumped on it. And I remember talking to Igor, and Igor was kind of quite careful, and he kind of just wanted to, you know, see if this Facebook thing was real. And so, they just took their time. But when they executed, they executed so well. They weren't necessarily prioritizing speed. And today, well-

    6. HS

      What do you think they did to execute so well?

    7. AB

      First of all, I think they really, uh... And this is a bit anticlimactic because there's no silver bullet in execution. I mean, we are, you know, as a company, we are, you know, we priden ourselves very, very strong executors. Um, and when people say, "What do you do when you're that good?" It's... The answer is really not one thing. It's just we pay attention to details. We, um, make sure that, you know, what matters, we spend a lot of time on, and what doesn't matter, we don't spend time. And that, that judgment is something that's really, you know, you develop it over a period of time. It's not something that can...

    8. HS

      It's so funny, one of my great friends is Gustav Soderstrom, who's the CEO at Spotify, and he says, "Details are not details, they are the product."

    9. AB

      Absolutely.

    10. HS

      And I love that.

    11. AB

      100%.

    12. HS

      Um, you, you also mentioned that, uh, kind of going back to the, um, you don't have to be solving a real problem, and actually great, great business... Fuck, TripleDot's a great business. Are built, not necessarily solving a real problem. How do you advise founders who think, "Well, I need to articulate that we're solving a real problem to raise money, to raise a pre-seed round, a seed round?" How do you advise them?

    13. AB

      It's a great point. I think, um, it depends a little bit on their backgrounds, right? If they are, you know... L- let's take gaming, for instance, um, and Dream Games is a perfect example of this, right? They... These are guys who's built two hits before, Toy Blast and Toon Blast, when they were at Peak Games. And, uh, when they came out, you know, with the kind of idea of starting a new studio, you know, my advice to them was, "You guys m- may not know how good you are, so you don't even need to tell people what you're gonna build, because it's gonna change over time." And that was true, and that resonated, you know, where they, they had, I think, in their pitch deck, they had like seven slides, and three of the slides talk about who the team was and what they've built before. Because truly, no one should care.

    14. HS

      Yeah.

    15. AB

      Like, if you simplify it to its core, what you say you're gonna build is going to change. I don't care who says what. It, it will be different. So to me, if you have the strength to lean on your previous experience, I would say lean on that, right? But if you're a first-time founder, if you're a brilliant guy out of university, if you're a, you know, a Facebook engineer and you're go... And you have to justify what you're going to build. You just have to play the game. So then, I advise them on how to play the game and how to communicate what they're going to build in a way that's, you know, defensible.

    16. HS

      The hardest thing for me as an investor, and I use you as the example here. I knew you well before, like, I invested in TripleDot. It was the easiest decision ever, trust you to the hills.

    17. AB

      Okay.

    18. HS

      It's just so ea-... I don't have that luxury with 99%, like you don't when you meet a founder. So as in... And attribution's hard.

    19. AB

      Yes.

    20. HS

      You said that, like, oh, you know, say what you've done and articulate your credits. But attribution's not always true. Some people take credit for things they didn't do. How do you think about actually determining quality in those people when you don't have that historical relationship arc?

    21. AB

      Yes. I think, you know, it's, it's not an easy thing. It's, there's, again, no silver bullets, because every rule we generate, we can c- you know, come up with counterexamples.

    22. HS

      Right.

    23. AB

      But I... In my experience, the people, um, that have s- that will succeed, if you kind of look back, they'll have grit, they'll have perseverance. They're the ones that actually respond to you right away. Like, you don't want someone who, you know, when you're communicating with them, take their time to respond to you or whatever it is. Um, but those are signals. How do you get down to the core, you know? I don't know. It's very hard. It's a very hard question. I think it's like falling in love. I... If you told me to write an algorithm to fall in love, I couldn't. But you-know-it-when-you-see-it kind of thing, you know?

    24. HS

      I, I, I totally... (laughs) Wait a second.

    25. AB

      (laughs)

    26. HS

      Uh, I totally get you there. Um,

  9. 35:20 – 43:41

    Startup Myth #2 — Your Life is Going To Suck

    1. HS

      next startup poor man. I'm loving this. Like, we should do a show together. Fuck 20VC. We should just call it Startup Poor Man who's, like, disabled.

    2. AB

      (laughs)

    3. HS

      Um, okay. You said, "When you do this startup, your life will now suck for a while. That's just how it is." I've heard this many times. I've actually...... said it, um, why is this wrong?

    4. AB

      That's just wrong 'cause, yes, I mean, there are cases that that will be the case. But depends on what you mean by your life will suck. My life didn't suck when I was building Tripledot, um, you know, um, my life... And not because I wasn't working like a dog, but, you know, my life... You know when my life sucked? When I was working two hours a day towards the tail end of my career at Facebook. By all measures, it was supposed to be super comfortable and, you know, whatever. I was cruising, right? I was barely doing any work at all.

    5. HS

      I guess, what are you doing when you're doing two hours a day? 'Cause we hear about this, like, rest, invest.

    6. AB

      Yeah.

    7. HS

      You just, like, sit in the canteen and let someone else-

    8. AB

      Yeah, you spend enough time to learn the inside of the machinery and, you know, you develop an expertise in just kind of punting away responsibility, right? Like, and-

    9. HS

      (laughs)

    10. AB

      ... you know, spend time enough there, and... You know, but you know what? My life was absolutely miserable because nothing I did actually mattered and, you know, I was always very frustrated, um, because I couldn't, you know, have any impact whatsoever. And I was always, you know, was like, "Am I gonna be found out?" Like, "Are they gonna realize that I'm doing basically no work here?" And that was not easy, right? That was not good. Compare that to Tripledot where I was working, uh, you know, very, very hard, um, but, you know, I was loving it and my life didn't suck. There was, like, some psychological challenges, like, you know, I used to, um, think about, you know, my HBS friends who were, like, working at Goldman and getting, whatever, millions of dollars a year, and I was basically making, you know, no money (laughs) whatsoever initially, right? That part was, you know, hey man, like, you know, I have a family, I have a kid. But that's when really kind of trust and kind of the comradery comes in, 'cause then I look at Eyal, I look at Lior, and I say, "You know what?" Like, "We're in this together." This is kind of, you know, the family kind of thing. And, um, and, you know, your life doesn't have to suck. It genuinely doesn't, you know. You ta- we talked about work/life balance. I do agree that work/life balance is not true in the standard sense of, you know, you work, you finish your home, y- y- so you, you work, you finish your work, you go home, and then you chill. That's not work/life balance, right? Um, if you're f- you know, lucky enough to be doing something that you like, and I don't mean it in the startup porn way, right? That you're excited about, you're good at. You go home, you sleep, and you're thinking about your work. Um, and that's why I was... I feel fortunate this is kind of what I found with Tripledot. So, you know, your life doesn't have to suck. Yes, you will work hard, you know, but you know what? You can manage your own time, you can manage your own schedule, um, and life doesn't have to suck.

    11. HS

      Speaking of managing your own time and schedule, I hope it's not too personal, but we were just chatting about it before and you sort of spoke about how you structure your evenings.

    12. AB

      Yes.

    13. HS

      Um, can you just talk to me about that, how you structure your evenings, getting the time with family and the work? What does that evening look like for you?

    14. AB

      Yeah, so, um, you know, we talked a little bit about my wife, and, you know, she's such an amazing person. And, um, frankly, when I was working at Facebook, I didn't... I traveled quite a lot and, you know, early on, when we were building Tripledot, you know, I would spend a lot of time, you know, either on the road or whatever, working, um, when things... You know, in the last two years, actually with COVID, what we learned is that we are more masters of our own schedule and destiny than we think. So, I started basically making a point of trying to be home every day by around 7:00, spending that time with the kids. And it's not much, it's two hours a day, but, you know, they, it's great for them, it's great for me, um, and I put them to bed every night, um, and, and, you know, be, basically between 7:00 and 9:00 it's family time, and I try to do nothing related to work between 7:00 and 9:00. And the more you do it, the more it gets known-

    15. HS

      Mm-hmm.

    16. AB

      ... um, and people just s- kind of start auto-censoring it. And then from 9:00 onwards, uh, you know, 9:00 to 10:00, I take a personal break. So every day for about an hour, I watch TV, I play some chess, or whatever it is, and then I, uh, from 10:00 onwards, I, I do work. And that's the work that I actually think is kind of my maker time, effectively, meaning, you know, during the day it's easy to get hijacked by meetings and this and that, but, you know, from 10:00 to 2:00, or 10:00 to 1:00, or whatever it is, you have just, effectively, me time that you're actually able to do whatever you want to do.

    17. HS

      No, I, I totally get you there and, uh, I love that. I think it's so important to have that family time. And you're right, I think it does get known internally. One thing that I think is funny is, and it kind of correlates to this, people say, "It doesn't get easier. It doesn't get easier." Akin, I'm gonna be fucking honest with you, it does. I mean, for me-

    18. AB

      (laughs)

    19. HS

      ... I get a San Pellegrino delivered, we sit in a nice studio-

    20. AB

      Yes.

    21. HS

      ... in Belgravia. It gets easier.

    22. AB

      Yes.

    23. HS

      Do you agree it doesn't get easier or are you with me, it does get easier?

    24. AB

      I think it does get easier, right? Because it's... I think it changes... The nature of the problems change. It's like when people ask me about kids, you know? When you have a small kid, you worry about something relatively minuscule every single day. Maybe every single hour, you know, you worry, "Is he breathing? Is he turning?" And as they grow older, you know, the magnitude of the problems increase, but their frequency decreases. So now, with my 12-year-old daughter, I worry about, you know, "Is she hanging out with the right friends? And if she's not, how can I change that?" And, you know, I think it's very similar to work. When we first started the company and, you know, uh, we were... It was different, but it was a different type of different. It was... Now, we're in a place our, um, daily worries, our problems have changed. And to be honest, personally, you know, having more money than I did before, it definitely helps. It's, kind of allows me to focus on things that I want.

    25. HS

      Sure.

    26. AB

      The biggest problem it solves for me is I don't have to spend time...... to optimize for an unknowable upside in the future. I mean-

    27. HS

      What do you mean by that?

    28. AB

      Sure. So, when, you know, when we started the company and even when I was at Facebook, right, I would, you know, become an advisor to company X, and the reason I would do that is, "Hey, what if, you know, they do something really well in the future? I could have some upside," and so on. And I spent a lot of time with people, frankly, that I shouldn't have spent. And when you have more liquidity, when you have more money, you don't have to do that. You just can say no to people that you just don't wanna hang out with, uh, because frankly you don't need the XYZ amount from that interaction. So, it does get easier in that sense because you have more freedom. What I'm... I guess what I'm describing is you have more freedom over your own time. You don't have to say yes to people that you don't want to.

    29. HS

      I'm just wondering why you still hang out with me then. (laughs)

    30. AB

      (laughs) I told you, I love you and I do genuinely find this... I think what you're building, and this is not again blowing smoke up your ass, but I think what you're building here is going to be incredible over the next five decades. So, this is kind of the time horizon I'm looking at you and I'm saying, okay, when Harry is 76 years old and he looks back what he has built, I think this will be the five decades of Harry because of the way that you operate, the relentless execution. And the most important thing is you have a why. So, once you have the why, and that's a very personal why, that's not a why that can be satisfied. If your why was money, there will come a point where we'll have, you know, diminishing returns. Your wife is... Your why is very personal. So, that's why I'm here. I don't really, honestly, frankly, I'm not here because you invest in our company because, you know... I mean, thank you, but that's not why I'm here.

  10. 43:41 – 50:28

    Startup Myth #3 — Focus is Everything

    1. HS

      "Focus is everything. You should focus on a single thing early on and do it very well."

    2. AB

      Yes.

    3. HS

      Heard that many times.

    4. AB

      Yes.

    5. HS

      Why is this wrong?

    6. AB

      Yes. Look, I'll give you a personal example. I mean, we, um... When we started Tripledot, um, early on internally we developed a technology inside Tripledot, um, and this may actually not even be a very well-known story for you either. Um, this technology was developed inside Tripledot, and this was not our core area of focus, right? This wasn't something... Like, we're a mobile games company. We're supposed to be building mobile games all the time. And, um, we developed this technology to enable us to better build games, but then we saw that this was... this, this piece of technology had such a product market fit in the market that we didn't even know about, and we decided to spin this off into a new entity called Luna Labs.

    7. HS

      Okay.

    8. AB

      And we, uh, you know, basically partnered with, uh, you know, another entrepreneur and some of my team from Facebook, and, uh... But we were very involved. So, if in those days someone who was preaching the gospel of startup porn met us, they'd say, "You guys are absolutely doing the wrong thing. You're kind of divided between two projects, and, you know, this and that." Um, and you know what? There's maybe some element of, you know... I understand that kind of why they're saying that. But Luna was sold within two years to IronSource for a pretty healthy amount, um, and we were able to execute across both paths together, right? So, I'm not necessarily anti this message, don't get me wrong, but, you know, the message is given with such certainty that if you're an entrepreneur that, you know, you hear this message, you say, "Okay, I must focus on only one thing." But no one tells you what to do. What if that one thing is the wrong thing, right?

    9. HS

      Uh, uh, so do you think this is a g- And I, I really actually quite like misalignment because I think no one talks about misalign... Everyone's like, "Ah, founder, you know, VC is so aligned, so aligned." There's not. There's like clear eyes. Here, to me, that is an area where you can diversify your risk-

    10. AB

      Yes.

    11. HS

      ... create separate pools of cash potentially for you.

    12. AB

      Yes.

    13. HS

      And that's fricking awesome.

    14. AB

      Absolutely.

    15. HS

      But for me as an investor, now obviously I'm invested afterwards-

    16. AB

      (laughs)

    17. HS

      ... I'm thrilled that it worked so well. But, like, it, it is still a diversion of attention.

    18. AB

      Yes.

    19. HS

      And that's not in my interest because I don't have holdings in Luna.

    20. AB

      Yes.

    21. HS

      Do you think that's a misalignment between founder and investor?

    22. AB

      So, in our case, again, this goes back to, you know, Lior always doing the right thing, I always try to do the right thing, what we did was, w- precisely because of that, we said, "All people who invested in Tripledot basically will mirror the cap table to Luna."

    23. HS

      Oh, wow.

    24. AB

      So, Julien, who was an investor in Tripledot, basically became an investor in Luna-

    25. HS

      Wow.

    26. AB

      ... without actually investing extra capital into Luna. And when we sold Luna, they all did really well. We didn't have to do that, but we did because-

    27. HS

      That's really good. I did not know that.

    28. AB

      Right? Yeah. So, we... There are ways to address those misalignments, but the core fundamental problem here is when you say, "You must focus on this thing," I think the spirit there is that, you know, you must not spend your time at whatever conferences or this. I, I do buy that. I think you must focus on execution. But this is said with such certainty that I actually have people that, you know, I have spoken with that listen to XYZ podcasts and, you know, some VCs are really, you know, (laughs) dangerously prominent in social media, and they, they say, you know, "Oh, focus on one thing, one thing only." And they... these guys come to me and they say, "Well, I focus on building this type of game, and I'm gonna spend my three years building this type of game." I tell them, "Okay, but what if it doesn't work? What if you're focusing on the wrong thing?" So-... that judgment, it all comes down to basically judgment, right? That judgment of what are you focusing on. Are you focusing on the right thing? Or you need to have some breathing room to allow yourself to pivot if the thing, you know, you talked about diversification-

    29. HS

      Sure.

    30. AB

      ... that's so important early on in the journey of the startup. So, you know-

  11. 50:28 – 56:30

    Building Company Culture

    1. AB

      I think, you know, culture is what happens when you're not looking, right? I heard this somewhere, and I think this is one area of porn that I can subscribe to. It's, um, you know, culture is truly what happens when you are not looking. But I do think that you can spend time on building a brand and building a PR, but that might be time that you're not spending in solving the core. It just depends on, it just depends on the situation, right? My kind of whole beef with this-

    2. HS

      My beef.

    3. AB

      ... my beef with this whole, um, kind of, um, startup porn is that it is given with such confidence and such uniformity, that sh- the truth is, it just depends on the individual founder, the individual company, what problem they're solving. If you can afford the luxury of thinking about brand and PR early on, more power to you, then by all means, you should do that.

    4. HS

      Yeah.

    5. AB

      But oftentimes these are, you know, competing things. So, you know.

    6. HS

      And I sometimes see it get well ahead of product and product execution.

    7. AB

      Yes.

    8. HS

      And then you're in a really dangerous territory.

    9. AB

      Yes.

    10. HS

      I think a lot of founders are too good at selling themselves and not selling their companies these days.

    11. AB

      Yes.

    12. HS

      Um, speaking of which, we mentioned culture there, uh, mission and vision.

    13. AB

      Yes.

    14. HS

      Wonderful things.

    15. AB

      (laughs)

    16. HS

      Aren't they? Aren't they just wonderful? Uh, you've said before, um, uh, about them being sometimes a challenge. And so I guess, why do you believe that mission and vision statements are usually bullshit?

    17. AB

      Yes. First of all, when I think about vision and, mission and vision statements, right? First of all, I per- and this might be just my shortcoming, right? Throw my hands up. I often have to Google what a mission statement is and what a vision statement is, right? And I've spent enough time, um, across multiple companies to, you know, I should know the difference, but I don't. And the reason I don't know the difference sometimes, right, before I Google-

    18. HS

      I, I don't actually know the difference now.

    19. AB

      See? So 99.9% of the times that you craft a mission and vision statement is because someone tells you, "We have to have a mission and vision statement." Right? 'Cause otherwise, you know, your mission statement could be, "I wanna make as much money as possible." Right? And that's okay. But no one is gonna have a mission statement that says, "I wanna make as much... We exist to make as much money as possible." Right? Why is that? I don't know. I think it's kind of weird, right? Like, this is not, uh, like, you know, we do want to make as much money as possible as Tripledot. But, you know, if you look at a company like Facebook, for instance, I actually wrote it down. It's something like, "Give people power to build community and bring the world closer." I don't know what that means at all.

    20. HS

      That is not, that is not their mission statement, is it?

    21. AB

      It is.

    22. HS

      (laughs)

    23. AB

      I have no idea.

    24. HS

      It's too long, one.

    25. AB

      Yeah. C- I don't know what, you know, give people the power to build communi- I genuinely don't know what that means.

    26. HS

      But Zoom is like, "Bringing happiness." You're like, that's quite generic. (laughs)

    27. AB

      (laughs) That's it, you know? Yeah, and actually, I was talking with a colleague of mine, uh, Alex Verbitsky, before the call, and he told me about...... a time when, you know, they were at a, um, WeWork off-site. Uh, he used to work at WeWork, and it's a European kind of, you know, management off-site. Um, and, uh, they were talking about the mission and the vision and, uh, the guy who was leading Europe at the time said, "I got a text from Adam Neumann and said about the new mission statement." And it was something like, "Elevate the world's consciousness."

    28. HS

      (laughs)

    29. AB

      And literally 30 seconds later, they got another text saying, "Hey we have a major problem because the toilets are clogged in the Waterloo location."

    30. HS

      (laughs)

  12. 56:30 – 1:03:49

    Hiring Tips & Advice

    1. HS

      totally ruined. But you said hiring people with domain expertise is tricky.

    2. AB

      Yes.

    3. HS

      And so you don't often do it.

    4. AB

      Yes.

    5. HS

      Why, why?

    6. AB

      So we... There are times that we do do it. Of course, there are times, you know, like if you are a game studio, you have to have a 3D artist that, you know, is, you know, the, the, the, the subject domain expert, et cetera. Um, I think when I look at, for instance, our marketing department, the guy who's running the marketing department for us does have experience in marketing. Um, but you know, but the people who are, you know, really the kind of folks that are, you know, reporting to him that are running day-to-day, we probably have the strongest marketing team of any gaming company I know. Um, and those people is the first time they all worked in like a gaming company, more or less. And the reason for that is marketing is a field, and, uh, you could talk about this for many other things. It's like any real relevant domain expertise you wanna have, you can really learn it in a several-month window, right? If you want to learn marketing, you could learn it in six months.

    7. HS

      Sure.

    8. AB

      But those people, they are coming from very good schools. They are all incredibly self-driven people. They're all hungry. I think the key word is hunger. They're all hungry. They all tend to be kind of, you know, type A level overachievers that are insecure. Um, and I don't mean this in a bad way. I am a very insecure person as well.

    9. HS

      Same with me.

    10. AB

      So those people, they will just, you know, kill themselves to, you know, make sure that the job gets done. And those are the... That, that is a trait that I don't think you can... I think that's very innate. I don't know if you can teach that to a person. You can teach marketing to anyone. You can teach pretty much anything you do. Even what we discussed, 3D art, you can teach it to a person. You cannot teach the hunger. And this is very true. So the reason we don't... It's not like we don't hire experts, right? But the reason we actually prioritize, um, hunger in the interview process is a very counterintuitive thing to do, because imagine you're, you and I start a company, right? And you know X, I know Y, but we have to also do Z, take marketing for instance. It's very tempting for us to say, "You know what? Let's hire person X from that company who's been doing this," and in a way, it's a mental offloading. You're offloading the burden by hiring someone else who's done that. But the context is different. The thing that they are doing has moved on. They were doing it in a different company with different constraints, with different thing... Everything about it is different.

    11. HS

      So I, I, I've got so many things. First off, like hiring for hunger. I agree.

    12. AB

      Yeah.

    13. HS

      I've got this wrong 90% of the time. I thought they were hungry. And honestly, I can... I think this generation is fucking lazy. They do not work... Sorry, I'm on a rant now.

    14. AB

      No, no.

    15. HS

      They do not wanna work hard. They do not want to come into the office. They get paid top dollar and actually they want great package, they want all of this.... and they don't work hard. And so I've misjudged hunger. Have you misjudged hunger, and what have you learned from your hiring success or failures in this?

    16. AB

      Sure. I mean, we're, you know, we have 450 people, I'm sure, and you know-

    17. HS

      Okay.

    18. AB

      ... we get, we get things wrong all the time. But I think what we do get right is, um, we have a very high standard in terms of hiring. You know, to get a job as a marketing analyst at Tripledot, you have to pass through several case interviews, you have to do modeling exercises, you have to do... and you have to talk to so many different people that have different levels of intellectual aggressiveness, right? And if you pass through that filter, no one can, you know, tell you you're not hungry. Or, you know, if you just kind of put... it's like, you know, converting to Judaism or something, right? Like, I have a friend, Antonio Garcia-Martinez, who, you know, is, um, is a Twitter personality-

    19. HS

      Sure.

    20. AB

      ... who converted to Judaism, and, you know, i- i- it's just like, if you are tr- if you're that, if you're that kind of going through those hoops, then I think it's, you know, uh, maybe you do belong there, right? So, our process is, you know, very vigorous, and if you just make it through that process, then, you know, you do know that you have a certain baseline of not only intellectual, uh, curiosity, but also hunger and, and, um, and rigor as well.

    21. HS

      What happens if you don't have the skill that you're hiring for? So say we're an early stage company-

    22. AB

      Yes.

    23. HS

      ... and me and you are the co-founders, and we're hiring a salesperson, leader, rep, whatever it is.

    24. AB

      Yes.

    25. HS

      Me and you have never done sales before.

    26. AB

      Yes.

    27. HS

      So we can't teach them really, can we?

    28. AB

      No.

    29. HS

      So should they not have d- uh, how do we, what do we do then?

    30. AB

      I think, look, y- you know, there is always room for someone who is an expert to teach, right? The, so, you know, in that case, if you and I just start hiring people, maybe we should hire someone who has some idea about sales, right? But, um, you know, you'll be surprised how easy it is for that knowledge to be gained, regardless of the, of the field, right? There are resources, there are, you know, there are just so many resources available. For someone who wants to learn sales, right? There are books written on SaaS sales. There's just things, there are just so many things you can do. I'm not suggesting you read a book and you're an expert.

  13. 1:03:49 – 1:10:29

    Startup Myth #4 — Valuations Do Not Matter

    1. HS

      which I loved. As an investor, this made me so happy. Valuations do not matter.

    2. AB

      (laughs)

    3. HS

      Remember this one? It's, uh, one out of five works well for me. Um, (laughs) you didn't say this in your funding round. (laughs)

    4. AB

      (laughs)

    5. HS

      Valuations do not matter in the long run and are dangerous. Break this down for me.

    6. AB

      Sure.

    7. HS

      Why do they not matter?

    8. AB

      Sure. So this actually, this time, I would say, the porn is the entrepreneurs are sometimes guilty of subscribing to this type of porn. I've seen many, many cases of companies that are really attracted to saying, "Hey, our last round, we were valued at X." And, you know, valuation, to me, can only be useful if it's a meaningful heuristic for future potential cash flows, right? But, valuations now are a measure of what that market's FOMO is for that business. And, you know, we've just seen during COVID times, you know, you could, you know, you know, you could literally get your grandma or grandpa start a gaming company, you could probably get funded at, you know, $100 million valuation. And then, you know, it's very, very easy as a founder to let that get to you, right? In your mind, all of a sudden, you have, let's say, 55% of the business valued at $100 million, and now you're thinking, "Okay, I have $55 million." Truth of the matter is, you have nothing, right? It's just all paper money. Not only you have nothing, oftentimes the mistake is, you know, it could go the other way, and we've seen this when valuations have corrected. Um, you've so much so many people ahead of you now in a, in a potential liquidation.

    9. HS

      Sure.

    10. AB

      Right? You have, you know, pref- you know, preference. You might have debt. You might have all sorts of things ahead of you, and you've hired people now that... and you have to give them options. And they have exercise prices, and to exercise those options, and we see this a lot more in the US than we do in Europe, but...They have to take out loans to exercise their options and when the valuations come down, not only they don't have money anymore, but they also are in debt. So, that is the nightmare scenario. And valuations are, it's, uh, basically the message here is that it ain't over until the fat lady sings, as they say in the US, right? So, valuations are a heuristic. They could be a healthy heuristic but they could also be a dangerous heuristic. And so long as you measure, you know, the pote- I think it will be valuable if you treat valuations as, "Okay, this is what my potential future cashflow can be." You know, but it's just a number, right? It's just a number. It doesn't really... This is not the perfect number to capture the essence of your business, right? It's just what the market perceives, what the market values your business and the domain you operate in, et cetera.

    11. HS

      First question, do you think anyone in Europe actually gives a shit about equity? I find that actually it's a lot more of a cash based culture in Europe-

    12. AB

      Yes.

    13. HS

      ... versus US.

    14. AB

      Isn't that crazy? Yes, I mean, yeah, it's a good point. I don't... So, what I can tell you that, you know, we have, um, operations in Eastern Europe, and I have had a lot of conversations when, you know, we may want to give someone equity and they're like, you know, "No." And actually the perfect anecdote for this is when I was at Facebook, you know, people were getting free food, right? And, you know, back then Facebook folks would complain about anything, right? And they would complain, "Why are you giving me free food? Give me more money instead." And, you know, the, some of the conversations I've witnessed in parts of Europe is, "I don't want equity. I want more cash." And, you know, I do understand kind of in a lack of a sophisticated enough startup ecosystem why this might be the case, but, you know, if you apply any type of regret minimization, right, to this, I think, you know, you will regret not getting that equity for your sweat, blood and tears. Um-

    15. HS

      Well, it's an interesting one, like, actually, because, like, pre-product market fit startup, I'd almost be like, "Load me up on cash."

    16. AB

      Yes.

    17. HS

      Like, there is a 95% chance that we won't make it to any form of meaningful outcome. Load me up on another 25K.

    18. AB

      It, I, yeah, maybe. I mean, it depends on your personal situation, right? I do believe that, you know, technology is the biggest enabler of wealth and the biggest contributor to human progression. And if you're a, you know, hungry guy, if you're a hungry girl, hungry person, if you are a, you know, smart, um, driven person, you know, within a long period of time, you will, you will make a lot of money.

    19. HS

      Right.

    20. AB

      You just almost can't afford, y- you just almost can't not, right? So, um, you know, if you have, if you have to have the cash to, you know, continue your living, your livelihood, then by all means. But, you know, I do think that you will regret in the future a lot more not having more upside in a case of, you know, the company becomes very successful than the opposite.

    21. HS

      For you as a founder hiring people-

    22. AB

      Yes.

    23. HS

      ... when they say, "Hey, give me cash-"

    24. AB

      Yes.

    25. HS

      ... are you like, "Ugh"?

    26. AB

      Yeah.

    27. HS

      Because I've had this before and it's-

    28. AB

      Yeah.

    29. HS

      ... it's quite dis- disheartening.

    30. AB

      Yeah, I mean, uh, it's, it's a bit cultural dependent because, you know, there are parts of Europe where that's just not a thing. Like, people just, people think you're trying to pull a fast one on them if you say, "I'm gonna give you equity." And so it is, you know, case by case.

  14. 1:10:29 – 1:17:00

    How UK Politics Can Promote Startup Innovation

    1. AB

      it's the same.

    2. HS

      I agree. Um, uh, a final one before we move into gaming-

    3. AB

      Sure.

    4. HS

      ... which I do wanna discuss, but, um, you were named the fastest growing company in Europe by the Financial Times.

    5. AB

      Yes.

    6. HS

      Um, an amazing, uh, achievement.

    7. AB

      Thank you.

    8. HS

      What do you think UK politics can do-

    9. AB

      (laughs) .

    10. HS

      ... differently around accreditation, around salutations.

    11. AB

      Sure.

    12. HS

      What do you think we could do differently?

    13. AB

      So I think UK... So, uh, I am quite a political person. I, I do like to get involved and without getting into too much specifics, right? I'm not a Conservative, I've, I've never been, right? But I do actually like, um, the fact that Rishi is, you know, the Prime Minister. Out of all the kind of candidates, I actually think he has a pro-business agenda-

    14. HS

      Sure.

    15. AB

      ... which I really like, and he has this kind of ability to articulate a vision that is, you know, tech friendly. I always said, actually, you know, when I contrast the US and the UK, it's such a phenomenal contrast 'cause I spent 16 years in the U- US and 11 years now in the UK, and I think, and, you know, people call me sappy for believing this, but, you know, the US, I still subscribe to this, you know, American dream. And it, you can feel it, you can breathe it, and this, this is super energizing for a foreigner. You go into the US, no one asks you, the first question is never, "Where are you from?" Never. It's almost rude to ask someone, "Where are you from?"... well, the first question always is, "What do you do?" Contrast that to the UK, where the first question cannot be, "What do you do?" It's rude, right? It's almost rude. It's like, "Where are you from?" And, you know, the way it manifests is that I have friends who are third-generation Turks born in Germany, uh, that they cannot say, "We're Germans," right? So, I do think there's a big missed opportunity because the amount of talent, the amount of academic talent in the UK is immense. UK is a hub for, you know, bringing people. And look at us, we have two Israeli founders, one Turkish founder, who decided to build this company in the UK, created hundreds of jobs, with a very pro-business government. And, you know, I'm sure he's very busy, et cetera, and so, I'm not, you know, you know, complaining, but, uh, you know, if my message was, "Hey, I'm going to build a poster child of, you know, UK equals success, equals tech and business."

    16. HS

      Sure.

    17. AB

      And then Financial Times was a, you know, well-established (laughs) paper, not only names in something like, you know, fastest growing games companies, the fastest growing company in Europe, and that happens to be in my backyard, you know, I would try to create a lot more, kind of, political capital around that. So-

    18. HS

      Can I ask you a bit of a divisive-

    19. AB

      Yes.

    20. HS

      ... one? Do you think Europe on the whole is a bit fucked?

    21. AB

      Um, I, I don't think that ... I don't think they're fucked. Why would they be fucked, right? If you look at the average European, you know, I think th- it depends on your definition-

    22. HS

      Like, decreasing-

    23. AB

      ... of fucked.

    24. HS

      ... growth rates, increasing regulation, specifically around AI.

    25. AB

      But take a, but take a look at their life, how they live, right? And look at... and people vote-

    26. HS

      Sounded (laughs) like a true European.

    27. AB

      Right? People... but p- people vote by their feet, right? Um, and this is why I also don't think America is fucked, and actually America... if you look at net migration of any country couplings, net migration into the US is more than net migration out, right? There are more Germans going to live in the US than Americans going to live in Germany. And the reason for that is just there's more opportunity in the US. And I do think that Europeans are not fucked because they live, you know, relatively healthy lives. They're f- uh, you know, making good money. So, if you think very basic core human level, I don't think they're fucked. I think they're living good lives. Now, if you ask for business competitiveness, yes, of course there's a lot of, you know, regulatory red tape, and there's a lot of problems with bureaucracy, and, you know, you mentioned AI regulation, all of that. And, uh, I mean, we've lost months of productivity over something silly called GDPR and et cetera, right? Um, but I just don't think fundamentally, you know, that matters in the grand scheme of things because, in the end, people here live high-quality lives. And that's why we're here. That's why I'm here. That's why I'm not living in, you know, somewhere in Africa or Asia or whatever. I want my children to have, you know, a good education, access to good healthcare, et cetera. That's why we're here.

    28. HS

      Are you ever tempted to move away with taxes? Like, when you look at Italy, it's 100K tax. You look at Lisbon. Uh, uh, it's tempting.

    29. AB

      Uh, it's not tempting enough to upset the settled lifestyle that I created for my children.

    30. HS

      Yeah.

  15. 1:17:00 – 1:27:51

    Misconceptions About the Gaming Industry

    1. HS

      before we do a quick fire on just gaming, 'cause I think there's just some, like, classic mistakes that people make. The one I l- hear all the time, "Ah, it's such a hits-driven business, huh?" Is that fair?

    2. AB

      I do understand why people say it, right? I think, um, if you look at the history of gaming, um, you look at console, you know, games developers and I think there has been a hit-driven nature historically. However, I think people say it and mean that, you know, success in gaming is random. I think it's, uh, it's all... people don't really mean hit-driven. They say just, you know, y- no one knows how successful you are. With mobile gaming, I do take issue with that. I don't think it's a hit-driven business. I think it's a data-driven business. And I think you are, you know, you need to create hits, but the way you create hits is very, very different. Again, I can give many counter-example. Playrix is an ex- perfect example. They've had four hits. You know, Triple Dot, we have multiple hits under our belt. Um, you know, the guys that are at Dream Games, they had multiple hits. On and on and on, right? And if you look at the business as a whole-... the success of a mobile game has nothing to do with how you make the game. It's all about how you operate the game, and how you operate the game is not, you know, I think a lot of times people think about gaming and they think about people in, you know, dreadlocks sitting in a room with beanbags and just kind of ideating stuff. That's not at all how it works, right? It's just all about how you operate the game, what decisions you make, very analytically driven.

Episode duration: 1:52:28

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