How Olivier Pomel Built Datadog By Refusing Every Shortcut

1. 0:00 – 0:57

   Intro

   1. GTGarry Tan0:00

      [upbeat music] Today, I welcome Olivier Pomel, the co-founder and CEO of Datadog. He created Datadog with Alexis back in 2010 just to help engineers figure out what was happening in their cloud. Now he's built that company into defining company of the cloud era. Welcome, Olivier.

   2. OPOlivier Pomel0:22

      Great to be here.

   3. GTGarry Tan0:23

      Great to have you. Uh, so we were chatting before about your first YC experience actually, was not today, was back in 2010. Tell me what happened then.

   4. OPOlivier Pomel0:33

      Y- yes, so we, we, we actually applied to YC in 2010. Uh, we got an interview, and we got rejected.

   5. GTGarry Tan0:39

      [laughs] I'm sorry to learn that.

   6. OPOlivier Pomel0:40

      So I s- I still have, you know, the, uh, the email from PG at the time, and, uh, you know, it turns out... So he was saying at the time that we were building a platform, but the platform was only as successful as its first product.

   7. GTGarry Tan0:51

      Mm-hmm.

   8. OPOlivier Pomel0:52

      And, uh, you know, our little revenge on life has been that we did make the platform successful in the end. [laughs]

   9. GTGarry Tan0:56

      [laughs]

2. 0:57 – 1:52

   A Chip on Your Shoulder

   1. GTGarry Tan0:57

      Do you think it actually helped you in some way to, to show, uh, us, to show him, uh, wrong?

   2. OPOlivier Pomel1:03

      I, I think... So first of all, I think many people who start companies, uh, go through a lot of rejection initially.

   3. GTGarry Tan1:08

      Mm-hmm.

   4. OPOlivier Pomel1:08

      And I think that's normal. Um, I think it's good, you know, to give you reasons to prove people wrong and-

   5. GTGarry Tan1:14

      True

   6. OPOlivier Pomel1:14

      ... you know, put a, a chip on your shoulder. And, and also, you know, I think the, the fear to, uh, f- fail-

   7. GTGarry Tan1:21

      Mm-hmm

   8. OPOlivier Pomel1:21

      ... that you feel initially, I think, at least in our case, it helped really build up the culture of the company, you know, making sure we buil- we were so obsessed about building something that was valuable. We were so obsessed about building a, a good business-

   9. GTGarry Tan1:34

      Mm-hmm

   10. OPOlivier Pomel1:34

       ... a business that could be self-sustainable in case we couldn't raise money. Um, and so all of that, I think, to this day remains the culture of the company, and we owe that to the, the difficulties early on.

   11. GTGarry Tan1:43

       I'm so happy to learn that, uh, we actually helped you [laughs] in the end. That's awesome. Uh, let's go back to the early days, uh, because you were born in France.

3. 1:52 – 3:29

   From France to New York

   1. OPOlivier Pomel1:52

      Yeah.

   2. GTGarry Tan1:52

      And then you moved to the US after... Was that after college?

   3. OPOlivier Pomel1:57

      Yes, so I had a, had an internship at the end-

   4. GTGarry Tan1:58

      Mm-hmm

   5. OPOlivier Pomel1:59

      ... of college in New York in, uh, in research-

   6. GTGarry Tan2:02

      Mm-hmm

   7. OPOlivier Pomel2:02

      ... at IBM at the time. And, uh, I, I thought I would say, stay for six months, and I ended up, you know, I'm still there.

   8. GTGarry Tan2:08

      You're still there. [laughs]

   9. OPOlivier Pomel2:09

      Yes.

   10. GTGarry Tan2:09

       How long have you been living there?

   11. OPOlivier Pomel2:11

       So it's been, like, 26 years now.

   12. GTGarry Tan2:12

       Wow, okay.

   13. OPOlivier Pomel2:12

       Uh, it's been a while. Um-

   14. GTGarry Tan2:14

       So you pretty much moved there just at the time of the bubble, the dot-com.

   15. OPOlivier Pomel2:18

       Yes.

   16. GTGarry Tan2:19

       Okay.

   17. OPOlivier Pomel2:19

       So I lived through the, the, uh, the end of the dot-com boom, and I actually worked in startup during the dot-com boom, which was-

   18. GTGarry Tan2:25

       Was an experience.

   19. OPOlivier Pomel2:26

       Yeah, it was, it was super ex- it was weird, you know, because you could tell that things were happening that, you know, didn't make complete business sense.

   20. GTGarry Tan2:34

       Mm-hmm.

   21. OPOlivier Pomel2:34

       You know, so for example, the, the CFO of one of our, of the startups, uh, every day went to the most expensive pastry shop in town and bought pastries for the engineers.

   22. GTGarry Tan2:43

       [laughs]

   23. OPOlivier Pomel2:43

       Um, I think that was a, that was a red flag maybe, thinking about it.

   24. GTGarry Tan2:46

       Maybe. [laughs] I guess you don't do that today.

   25. OPOlivier Pomel2:48

       Yeah, you don't, we don't, we don't do that, no.

   26. GTGarry Tan2:49

       That's not the thing you, you learned from them.

   27. OPOlivier Pomel2:51

       Yes, but so I think the world was full of promise then. Then, of course, the, uh, the, the dot-com, you know, boom turned into a dot-com crash. We've been through all of that. There were a few years after that where it didn't look like technology would be worth anything ever again.

   28. GTGarry Tan3:07

       Mm-hmm.

   29. OPOlivier Pomel3:07

       Uh, so I, I stayed in New York, and my, my co-founder for Datadog, Alexis, also stayed in New York.

   30. GTGarry Tan3:11

       But I guess you worked elsewhere at the time.
4. 3:29 – 5:06

   How Olivier Met Alexis

   1. OPOlivier Pomel3:29

      No, we-

   2. GTGarry Tan3:29

      ... or you knew him from before?

   3. OPOlivier Pomel3:30

      Oh, we, we met actually in briefly in school in France.

   4. GTGarry Tan3:33

      Okay.

   5. OPOlivier Pomel3:34

      And the, the funny story here is, um, uh, I was part of the team that ran the campus network.

   6. GTGarry Tan3:39

      Okay.

   7. OPOlivier Pomel3:39

      And Alexis was caught hacking on the campus network, and so he was court-martialed by the student body, and he was sentenced to disconnection, and I carried out the sentence.

   8. GTGarry Tan3:49

      [laughs] That's a great way to get to know someone.

   9. OPOlivier Pomel3:51

      Yes, so I... And we didn't really interact all that much. You know, I thought he was this black hat guy, you know? Uh, and then we ended up finding each other again at that IBM, uh, internship basically. So he was there, too. Uh-

   10. GTGarry Tan4:03

       And then you worked again together the next time, the next company you joined.

   11. OPOlivier Pomel4:06

       Yes, and then we worked together in a total of four or five companies, you know? So-

   12. GTGarry Tan4:09

       So you never worked in any place without him.

   13. OPOlivier Pomel4:12

       Yeah, basically. I mean, we, we always bring the other. Like, you know, maybe one of us would go somewhere, and then two or three months later, we'd bring the other here. So-

   14. GTGarry Tan4:19

       So that's a strong relationship.

   15. OPOlivier Pomel4:20

       Yeah, yes.

   16. GTGarry Tan4:20

       And then, and then you co-founded Datadog together.

   17. OPOlivier Pomel4:23

       Yes.

   18. GTGarry Tan4:23

       And you're still working together there.

   19. OPOlivier Pomel4:25

       Yes.

   20. GTGarry Tan4:25

       Any secret of keeping that kind of marriage [laughs] lasting like that?

   21. OPOlivier Pomel4:30

       Yeah. Well, I mean, look, it's a... I think it takes, it takes effort. For one thing, before we started a company, because starting a company is pretty hard.

   22. GTGarry Tan4:37

       Mm-hmm.

   23. OPOlivier Pomel4:37

       Uh, before we started a company, we had known each other and worked together for more than 10 years, and so we had tested a lot of the, you know, different ways the, the relationship can go. You know, and we're also good friends, um, so, and, and that helped quite a bit. Um, after that, I think as, uh, as we've grown Datadog, like, we've made sure we kept a lot of space for, uh, talking to each other.

   24. GTGarry Tan5:00

       Mm-hmm.

   25. OPOlivier Pomel5:00

       You know, so we have these regular lunches and things like that where the, the whole point is just to talk. Um, and

5. 5:06 – 7:33

   The Secret to a 15-Year Co-founder Marriage

   1. OPOlivier Pomel5:06

      I think-

   2. GTGarry Tan5:06

      Like no agenda.

   3. OPOlivier Pomel5:07

      No.

   4. GTGarry Tan5:07

      Just open-ended conversation.

   5. OPOlivier Pomel5:09

      Yes, and, and there's one extra thing which is very important, which is anytime there's a big decision to make, so for example, sell or not sell. Like, you know-

   6. GTGarry Tan5:18

      Right

   7. OPOlivier Pomel5:18

      ... as you grow a company, um, you're going to have folks, you know, every now and then that will try and buy you out. Um, and these are big decisions, and-

   8. GTGarry Tan5:27

      And did you decide after getting a real offer, or did you decide to not even open the conversation?

   9. OPOlivier Pomel5:34

      We, we, we had those conversation where we, when we had offers or when, when folks were pretty serious with us. And it's very important in those cases to make sure that you're on the same page, you know, because that's what could get, can cause companies to blow up is when, uh, one of the founders, uh, kind of wanted to sell and the other one didn't. But, you know, one maybe didn't really tell the other or, you know, they told them what they thought they wanted to hear. But then, you know, it turns into a problem later on. Like, so it's very important to spend a lot of time talking on those point to make sure you really understand what each other want, you know?

   10. GTGarry Tan6:04

       You bet. It's very easy, uh, in hindsight now to, to say yes, of course, that was the right decision not to sell. But I guess at that time it's a lot of money you leave on the table, uh- And there is no guarantee that your company's going to be successful.

   11. OPOlivier Pomel6:16

       Yes. And you know, when I, when I started Datadog, I remember seeing, um, like companies that didn't sell for, you know, refuse an offer for 200 million, and I thought, "Wait, what kind of a, of a, you know-

   12. GTGarry Tan6:26

       [laughs]

   13. OPOlivier Pomel6:26

       ... who, who refuses 200 million?" Um, and then, you know, we refused that, and then we refused 10 times that, and then, you know, refused, you know, more than that even. Uh, I think the question is always-

   14. GTGarry Tan6:36

       When, when you became public, what was the first, uh, uh, cap of the company?

   15. OPOlivier Pomel6:40

       So we, we went public at, so the, the, the go public price was around seven and a half billion.

   16. GTGarry Tan6:45

       Okay.

   17. OPOlivier Pomel6:46

       And we very quickly traded at 10, 12, uh, up from that.

   18. GTGarry Tan6:50

       And then a rollercoaster to a-

   19. OPOlivier Pomel6:51

       And then, and then rollercoaster

   20. GTGarry Tan6:52

       ... to kind of like much more today.

   21. OPOlivier Pomel6:54

       Yes. Today we're around 80.

   22. GTGarry Tan6:55

       Mm-hmm.

   23. OPOlivier Pomel6:55

       Um, but at the time it was, uh, it was around that. And we, you know, we've refused lo- large offers along the way, and again, the, the thinking there is always, um, what's the upside? How do we, how do we think about the business? Are we, are we done with what we wanted to do? Is there, you know, 5X, 10X more we can do? Can we see? Do we believe in it? Do we want to do it? You know, is it exciting enough for us?

   24. GTGarry Tan7:16

       Yeah.

   25. OPOlivier Pomel7:16

       And that's what, what drives the decision.

   26. GTGarry Tan7:17

       What are you going to do with your life after? [laughs]

   27. OPOlivier Pomel7:20

       Yes. Yes.

   28. GTGarry Tan7:20

       Do you retire?

   29. OPOlivier Pomel7:21

       Yes. Yes.

   30. GTGarry Tan7:21

       It's kind of like a-
6. 7:33 – 10:44

   Building in the Early Cloud

   1. GTGarry Tan7:33

      but before being that successful, uh, I mean, the early days were not that easy, right?

   2. OPOlivier Pomel7:37

      I know.

   3. GTGarry Tan7:37

      'Cause when you started, it was nearly pre-cl- the very early days of the cloud, right?

   4. OPOlivier Pomel7:41

      Yes. Yes.

   5. GTGarry Tan7:42

      How did you approach that?

   6. OPOlivier Pomel7:43

      Yeah, so it was, it was, uh, so it was very hard from a, a understand the market perspective. So we, Alexis and I didn't come from systems management, so most of the people who started companies in our space used to work for a vendor that made software, you know-

   7. GTGarry Tan7:58

      Mm-hmm

   8. OPOlivier Pomel7:58

      ... that sold software for that. We didn't have that. We also didn't come from a hyperscaler, so we didn't come from Google or, you know, one of the places that was operating at super large scale, and maybe, you know, folks had some glimpse of the technology that, that-

   9. GTGarry Tan8:10

      Mm-hmm

   10. OPOlivier Pomel8:10

       ... you know, can, can, can, can, uh, run that or the technology that's coming for the rest of the world. So because of that, it was very, very difficult for us to convince investors initially, so, and we mentioned YC, but, you know, uh, pretty much every single other VC also passed on us at the time. Um, so it was a very humbling experience.

   11. GTGarry Tan8:30

       A lot of people will regret today, I guess. [laughs]

   12. OPOlivier Pomel8:32

       Well, I mean-

   13. GTGarry Tan8:33

       But some of them-

   14. OPOlivier Pomel8:34

       Some of them, some of them invested later, right?

   15. GTGarry Tan8:35

       Okay.

   16. OPOlivier Pomel8:35

       You know, so that's, uh, that's the thing with, uh, with investors. There's always a next round. You know, maybe not for YC, but you know, for everybody else-

   17. GTGarry Tan8:40

       Yes

   18. OPOlivier Pomel8:40

       ... there's always a next round. Um, and um, the, the other part of it though is because we didn't come from the, um, the, the space, uh, we, we sort of saw things a little bit differently. Uh, our starting point was not, "Hey, let's take that existing product category and make it better." Our sta- our starting point was, "Hey, there's this huge problem. Like Dev and Ops don't talk to each other, and they fight all the time, and can we bring them into, uh, into, uh, under one roof and into one platform?"

   19. GTGarry Tan9:07

       Mm-hmm.

   20. OPOlivier Pomel9:07

       Um, so we saw that in a way that I don't think the rest was seeing it because we were living it on the user side. Um, we... What we didn't really fully understand was the importance of the cloud and the fact that, um, what we were doing was right at the center of it. You know, so disintermediating, bringing Dev and Ops together, actually that's big part of the cloud adoption. And of course we, at the time in 2010, you know, Amazon was a, was a, or AWS was the only game in town.

   21. GTGarry Tan9:34

       Yeah.

   22. OPOlivier Pomel9:34

       And it was a toy. Um, and companies, real companies would, were telling you that they were, were never going to use that.

   23. GTGarry Tan9:40

       Yeah. Nobody was ever going to move to the cloud, right?

   24. OPOlivier Pomel9:41

       Yes, exactly. And, and of course-

   25. GTGarry Tan9:44

       And then it happens. [laughs]

   26. OPOlivier Pomel9:44

       Yeah. Which it happens. It was extremely broad, extremely deep. Um, and uh, so that was a big part of our success.

   27. GTGarry Tan9:49

       It took a, it took a... When I compare that to how fast people are adopting AI, for example, I mean, cloud, it took 10 years to get to full adoption.

   28. OPOlivier Pomel9:56

       Yes.

   29. GTGarry Tan9:57

       And, uh, in a way you were lucky. I mean, lucky. Uh, you are smart, but like you kind of like, uh, ended up at the center of that, uh, revolution.

   30. OPOlivier Pomel10:06

       Yeah.
7. 10:44 – 13:39

   How Olivier Still Runs the Company

   1. GTGarry Tan10:44

      Yeah. So, uh, one thing that came back often when I was, uh, discussing with, uh, ex-Datadog, uh, we have quite a few founders-

   2. OPOlivier Pomel10:52

      Mm-hmm

   3. GTGarry Tan10:52

      ... who came from Datadog or got acquired by you-

   4. OPOlivier Pomel10:54

      Mm-hmm

   5. GTGarry Tan10:54

      ... were on the other side of the M&A after, um, uh, mentioned h- the culture and how you as the founder are still very much heavily involved in like some product decision and like that you don't... Yeah, you are not at the strategic whatever power point level-

   6. OPOlivier Pomel11:12

      Mm-hmm

   7. GTGarry Tan11:13

      ... at all. Can you tell us a little more about how you see that and how you make these decisions?

   8. OPOlivier Pomel11:17

      Y- yes, so there, there's something that's very important is that I and the rest of the management team-

   9. GTGarry Tan11:22

      Mm-hmm

   10. OPOlivier Pomel11:22

       ... um, have to, uh, understand what really happens on the ground.

   11. GTGarry Tan11:25

       Mm-hmm.

   12. OPOlivier Pomel11:26

       Like, you know, the problem you have as the company grows is that you develop these, uh, these beautiful stories. You know, people tend to manage up. Um, they want to be able to, uh, tell good news to management, you know? Um, and that's, that's human.

   13. GTGarry Tan11:38

       Yes.

   14. OPOlivier Pomel11:38

       That's just the way people are wired, right? Um, and so everything, uh, I do there in terms of the systems we put in place is to force people to look down instead of up, so to look at what's actually happening, what's happening with the customers, what's happening with the product, what's happening with the technology, what's working and not working.

   15. GTGarry Tan11:53

       And concretely, what does that, uh, what does it mean day to day?

   16. OPOlivier Pomel11:55

       So day to day, what I do is I, I sample a lot of the stuff.

   17. GTGarry Tan11:58

       Mm-hmm.

   18. OPOlivier Pomel11:58

       So I sample... I, I'm going to read, um, support requests.

   19. GTGarry Tan12:01

       Mm-hmm.

   20. OPOlivier Pomel12:01

       I'm going to read sales conversations. I'm going to read, um, actually I read all of the product briefs, like all of the product releases-

   21. GTGarry Tan12:08

       Mm-hmm

   22. OPOlivier Pomel12:08

       ... and everything we do to make sure we're understanding where exa- exactly what's going on there. And what I will do is, uh, occasionally I will reply, and I will ask question like, you know, "Hey, what's going on there?" Or, you know, "I don't understand this part." Or... And You know, very often, like, the first thing that happens after-

   23. GTGarry Tan12:24

       Yeah

   24. OPOlivier Pomel12:24

       ... that is the person who wrote that email or, you know, uh, put in that conversation in the system says, "Why, why, why is he looking at that?" [laughs] Um, and, and what it does is, is it kind of it jolts people a little bit, and also forces the local management chain to look down and fear, and people ask themselves, "I better understand what's going on there because I may be asked about it."

   25. GTGarry Tan12:45

       Right.

   26. OPOlivier Pomel12:45

       And on an ongoing basis, it forces people to, uh, to understand exactly the reality under them as opposed to, uh, you know, just weaving a beautiful message. You know, on my end, you know, it sort of trains the machine. You know? Like, that, uh, uh, I, I get a sense of reality-

   27. GTGarry Tan13:01

       Yeah

   28. OPOlivier Pomel13:01

       ... a simple reality, and then I can also figure out what agrees and doesn't agree with the stories I see at the higher level, you know.

   29. GTGarry Tan13:06

       That's your own training data.

   30. OPOlivier Pomel13:08

       Yes. Yes.
8. 13:39 – 15:14

   When to Ask for Approval (and When Not To)

   1. OPOlivier Pomel13:39

      so we try to set up in a way that, that, you know, where feedback or executive feedback in particular is, uh, is possible-

   2. GTGarry Tan13:47

      Mm-hmm

   3. OPOlivier Pomel13:47

      ... but not required. So things are going to move along anyway.

   4. GTGarry Tan13:50

      Okay.

   5. OPOlivier Pomel13:50

      And they're going to move along with a number of communication points where, you know, you see what's happening, you see what's going to be released, or you see what has been released. Uh, and feedback can happen at any point there, but people don't wait for it. There's a few specific, you know, hard changes. For example, when you change the pricing and packaging of some products or things that can have a large impact and that, that are hard to back out of, um-

   6. GTGarry Tan14:09

      Yeah

   7. OPOlivier Pomel14:09

      ... that, you know, you have some pre-approvals. But for pretty much everything we build, people just push it up, um, and maybe there's feedback, maybe there's no feedback.

   8. GTGarry Tan14:18

      So if it's, uh, life-sustaining for the company, of course you have-

   9. OPOlivier Pomel14:22

      Yes

   10. GTGarry Tan14:22

       ... like, you are like a filter. Uh, but if it's like relatively low-stake decisions-

   11. OPOlivier Pomel14:29

       Yeah

   12. GTGarry Tan14:29

       ... nobody's waiting for anyone.

   13. OPOlivier Pomel14:30

       Or, you know, high stakes, but, you know, you can, you can reverse them easily.

   14. GTGarry Tan14:33

       Mm-hmm.

   15. OPOlivier Pomel14:33

       Or... You know, it's very easy, like, in, in, um, uh, when in B2B, it's very easy also to test some products-

   16. GTGarry Tan14:40

       Yeah

   17. OPOlivier Pomel14:40

       ... with some customers, make some changes for some customers, see how it works in the... And, and that's, that's actually how we build in general. Like, we see at a small, small scale with some customers how it works, you know, whether it, it improves things for them or not. Um, and then we, we roll that out more broadly.

   18. GTGarry Tan14:55

       So you started with, uh, just, uh, infra monitoring.

   19. OPOlivier Pomel14:58

       Mm-hmm.

   20. GTGarry Tan14:58

       Like, uh, I think you were not even calling that observability yet, and then you expanded to many other, like, aspects of, uh, observability as a, as a high-level term. Like, how do you decide to build a new product? Um, like, what's your process

9. 15:14 – 17:53

   How Datadog Decides What to Build Next

   1. GTGarry Tan15:14

      here?

   2. OPOlivier Pomel15:14

      Yeah. So I mean, mostly we, we see what our customers do with our product.

   3. GTGarry Tan15:17

      Mm-hmm.

   4. OPOlivier Pomel15:17

      Uh, we see what kind of situation they put us in, and what kind of extensions and scripting and other things they build around us, and that gives us an idea of the problems they have and also where, where they think we belong. And so that, uh, for example, when we expanded from infrastructure monitoring at the time to, uh, APM, you know, tracing applications basically-

   5. GTGarry Tan15:35

      Yeah

   6. OPOlivier Pomel15:35

      ... we were seeing our customers build, you know, simple versions of that themselves on top of our platform, and so it was pretty clear, you know, they wanted us to do that.

   7. GTGarry Tan15:43

      Yeah, you had to do it yourself. [laughs]

   8. OPOlivier Pomel15:43

      Yes. And we see the same-- We saw the same thing when we, uh, we saw customers, uh, doing security automation with us, like instrumenting, uh, their security posture and doing security automation with us, so that was pretty clear that we, there was something we could do for them, uh, in that area. So that's really what drives most of the, the new, uh, um, entry points, yeah.

   9. GTGarry Tan16:01

      Does that come from the teams, like, uh, who are seeing that day-to-day once they interact with customers?

   10. OPOlivier Pomel16:07

       Yeah.

   11. GTGarry Tan16:07

       Or is that some top-down-

   12. OPOlivier Pomel16:09

       Yeah

   13. GTGarry Tan16:09

       ... approach here?

   14. OPOlivier Pomel16:10

       So there's, there's actually three parts. Uh, there's one part which is customer feedback.

   15. GTGarry Tan16:14

       Okay.

   16. OPOlivier Pomel16:14

       And customer feedback is, uh, I mean, I would say the majority of the changes we make.

   17. GTGarry Tan16:19

       Mm-hmm.

   18. OPOlivier Pomel16:20

       Uh, the good thing about customer feedback is that you're generally right. Like, you have enough customers, you have, you know, feedback, and usually it's right. The bad thing about customer feedback is that it's often very incremental.

   19. GTGarry Tan16:30

       Mm.

   20. OPOlivier Pomel16:31

       You know, so, you know, "I want, fix that button, please," or, "I need another integration," or, you know, um-

   21. GTGarry Tan16:36

       "We want the faster horses."

   22. OPOlivier Pomel16:37

       Yes, yes. And that's great, but you do all of that. But in addition to that, there's the more top-down, uh, you know, which I, uh, begrudgingly call strategic, uh, which-

   23. GTGarry Tan16:49

       [laughs] It's not a word you like to use

   24. OPOlivier Pomel16:50

       ... I, I, I hate that word. Um, but basically, hey, we know we're going to new areas that are a little bit different. There's less direct feedback from customers about it, but we know it's going to be important, and we see we have proof points that it will be relevant for us.

   25. GTGarry Tan17:01

       Yes.

   26. OPOlivier Pomel17:01

       So you do some of that. Um, you're wrong more often when you do that-

   27. GTGarry Tan17:05

       Mm-hmm

   28. OPOlivier Pomel17:05

       ... um, but you need to do it. And then the last part is complete bottom-up, and complete bottom-up is the engineering teams or the product teams, uh, solved a problem that they just, they thought needed solving, and we're building products out of that. And-

   29. GTGarry Tan17:19

       Oh, it could be an internal need or it could be anything.

   30. OPOlivier Pomel17:22

       Yeah. Could be we built an internal platform for something and we want to productize it. Could be-
10. 17:53 – 18:51

    25 Products, 8,000 People

    1. OPOlivier Pomel17:53

       innovation.

    2. GTGarry Tan17:53

       And so how many, uh, how many products do you have today?

    3. OPOlivier Pomel17:56

       Uh, we have, like, 25 that we charge for.

    4. GTGarry Tan17:58

       25 Products publicly released-

    5. OPOlivier Pomel18:01

       Yes

    6. GTGarry Tan18:01

       ... you can buy. Okay.

    7. OPOlivier Pomel18:02

       Yes, yes, yes.

    8. GTGarry Tan18:03

       And, uh, and what, how many compa- how many employees?

    9. OPOlivier Pomel18:05

       We have 8,000 employees.

    10. GTGarry Tan18:06

        8,000.

    11. OPOlivier Pomel18:07

        Yeah.

    12. GTGarry Tan18:07

        Okay. So that's kind of like a complex organization to get right here.

    13. OPOlivier Pomel18:11

        Yes.

    14. GTGarry Tan18:11

        Okay.

    15. OPOlivier Pomel18:11

        But, but, you know, the, the way the products are adopted is, is somewhat similar to, um, what you might see, you know, at a cloud provider like an AWS or, you know, so the-

    16. GTGarry Tan18:19

        Hopefully, hopefully better.

    17. OPOlivier Pomel18:20

        Yes. Well, that's, that's the whole point, but the, the, the point here is you don't, you know- You don't have 25 different sales processes and sales teams and everything, so that's much simpler from that perspective.

    18. GTGarry Tan18:31

        Uh, that makes sense. Um, and then, uh, and then there was that AI kind of like a complete disruption of the business and the market, right? Uh, how did you go through that? I guess, uh, were you taken by surprise? Did that affect you? It feels like, uh, the markets, once you are public, of course, markets is more volatile.

    19. OPOlivier Pomel18:50

        Yeah.

    20. GTGarry Tan18:50

        How did it

11. 18:51 – 20:19

    Surviving the Pandemic Lockup

    1. GTGarry Tan18:51

       react?

    2. OPOlivier Pomel18:51

       Yeah. I mean, market volatility, I think we're kind of used to.

    3. GTGarry Tan18:54

       Yeah.

    4. OPOlivier Pomel18:54

       You know, so we, uh, we-- So we went public in t- uh, 2019.

    5. GTGarry Tan18:58

       Mm-hmm.

    6. OPOlivier Pomel18:59

       And our-

    7. GTGarry Tan19:00

       Pre-pandemic.

    8. OPOlivier Pomel19:01

       Yeah, pre-pandemic.

    9. GTGarry Tan19:01

       You probably went through up and downs and-

    10. OPOlivier Pomel19:02

        Yeah

    11. GTGarry Tan19:03

        ... up and downs there.

    12. OPOlivier Pomel19:03

        Yeah, I mean, our lockup expired the day of the lockdowns. Uh, so ma- huge market crash at the same day or the, the same day our lockup expired. Uh, the stock was down like crazy. Uh, everybody was watching in horror at the time. Also, I mean, it was-- the world was pretty scary too at the time, if you remember.

    13. GTGarry Tan19:19

        Yeah. Nobody would-- knew what would, uh-

    14. OPOlivier Pomel19:20

        Yes

    15. GTGarry Tan19:21

        ... what, uh, would come next.

    16. OPOlivier Pomel19:22

        Um, and it probably ended up being worse than what we thought at the time too, like in terms of how long it lasted. Um, but-

    17. GTGarry Tan19:28

        But maybe business-wise, it wasn't as bad as you expected.

    18. OPOlivier Pomel19:30

        No, business-wise, it was, it was actually a seesaw. You know, the market crashed, and the market went, went back up very quickly. And, and then we've seen more gyrations like that over time. So markets going up and down, I think we, we're used to.

    19. GTGarry Tan19:41

        Mm-hmm.

    20. OPOlivier Pomel19:42

        We actually educate the company quite a bit on that. So every quarter, you know, we have a, an all-hands where we go through all of the results.

    21. GTGarry Tan19:47

        Mm-hmm.

    22. OPOlivier Pomel19:48

        Um, and we always end up with a slide that says, you know, the, uh, in the short term, the, uh, the markets, the st- the stock market is a voting machine. Uh, in the long term, uh, it's a weighing machine.

    23. GTGarry Tan20:00

        Mm.

    24. OPOlivier Pomel20:00

        And so, hey, what happens today doesn't matter. What ha- what really matters is we build enough of the right things, we find enough of the right customers for it, we deliver the right service, and then, you know, everything will be fine.

    25. GTGarry Tan20:09

        Oh, okay. Okay, makes sense. How about the AI impact? Like, uh, I guess the market reacted to you being the incumbent. Like-

    26. OPOlivier Pomel20:16

        Yeah

    27. GTGarry Tan20:17

        ... early on you were kind of like the disruptor.

    28. OPOlivier Pomel20:18

        Yeah.

    29. GTGarry Tan20:18

        But

12. 20:19 – 23:21

    Winning the AI Wave

    1. GTGarry Tan20:19

       by now you are the incumbent yourself.

    2. OPOlivier Pomel20:21

       Yeah. So I mean, the two things. One is we're-- So yes, we technically we lead the observability market.

    3. GTGarry Tan20:26

       Mm-hmm.

    4. OPOlivier Pomel20:27

       But we only have 13% of it according to the measures.

    5. GTGarry Tan20:30

       Okay.

    6. OPOlivier Pomel20:31

       And that market is growing fast, so the bulk of the opportunity is, is still ahead of us there. Um, on the, on the AI side, I think it's difficult for public investors to understand, you know, who's winning and who's losing in the long run because it is fairly disruptive. It's changing a lot of the product needs. It's changing, you know, qui-quite a few things. Uh, it's also disrupting business models. In our case, it doesn't really matter. Like in our case, we are usage-based, you know, but many companies that are seat-based, for example, have to rethink, uh, how their businesses are going to be structured. So we-- on our end, so we were actually quite busy building products both for, uh, the, the, the AI, uh, builders, I would say.

    7. GTGarry Tan21:12

       Okay.

    8. OPOlivier Pomel21:12

       And also-

    9. GTGarry Tan21:12

       Like AI as customers.

    10. OPOlivier Pomel21:13

        Yes.

    11. GTGarry Tan21:14

        AI companies as customers.

    12. OPOlivier Pomel21:15

        Yes. And also for the, uh, the, the all the other companies that were starting to consume AI. And then in addition to that, you know, we're also building AI into our own product for automation. So, you know, we have these two big initiatives, and initially we call them Datadog for AI and AI for Datadog. Uh-

    13. GTGarry Tan21:30

        In a way, like from kind of a maybe a scare of the market because you were the incumbent that was going to be disrupted by AI, you became a winner of the AI changes, like because that's more customers-

    14. OPOlivier Pomel21:42

        Yeah

    15. GTGarry Tan21:42

        ... bigger customers, new products.

    16. OPOlivier Pomel21:44

        Well, on the-- on one end, you know, there's, there's so much more demand. Like, you know, there's more software, more infrastructure, more everything, and that's-- and it's getting-

    17. GTGarry Tan21:50

        How much of your business now is AI companies?

    18. OPOlivier Pomel21:53

        Um, so we-- I think we, we stopped disclosing it, you know, so I can't-

    19. GTGarry Tan21:56

        Okay. So you don't have to say a number.

    20. OPOlivier Pomel21:57

        Because we, uh, we, you know, we, we choose, uh, which metrics we disclose. But we, like we serve like the, the top 10 AI companies in the world.

    21. GTGarry Tan22:05

        Okay.

    22. OPOlivier Pomel22:05

        Um, and they're growing fast. And but we also serve all of the other, uh, startups, or not all, but a, a good fraction of the, uh, of the startups that are building and scaling fast, you know. So, uh, the-- on one end you have the-

    23. GTGarry Tan22:17

        So did you, did you re-accelerate then?

    24. OPOlivier Pomel22:19

        Yes.

    25. GTGarry Tan22:19

        Is that-

    26. OPOlivier Pomel22:19

        So we saw substantial re-acceleration of the business and, and you know, if you zoom out, if you look at the just the sheer amount of complexity there is in terms of the-

    27. GTGarry Tan22:28

        Mm-hmm

    28. OPOlivier Pomel22:28

        ... you know, the build out, the GPUs, the models. The models themselves are really hard to, uh, manage and monitor and secure and everything else. Um, the-- and in addition to that, the crazy amount of code that is being produced with coding agents, the fact that now, um, the code when it's written, you actually don't-

    29. GTGarry Tan22:46

        Mm

    30. OPOlivier Pomel22:46

        ... don't know it. You don't understand it. Like you-
13. 23:21 – 24:10

    The Dream of the Machine That Fixes Itself

    1. GTGarry Tan23:21

       You bet. And I, I guess, but that's probably, uh, very exciting to have a new, complete new space of potential products to build.

    2. OPOlivier Pomel23:29

       Yes. And, and look, the, the, the whole space has been, um, chasing AI automation like since-

    3. GTGarry Tan23:36

       Mm-hmm

    4. OPOlivier Pomel23:36

       ... like ever since the first, uh, you know, uh, infrastructure monitoring product came out, like I think there was maybe something about AI in it, you know, like even twenty years ago, thirty years ago. Uh, it never quite worked, right?

    5. GTGarry Tan23:47

       Yes.

    6. OPOlivier Pomel23:47

       Uh, today-

    7. GTGarry Tan23:49

       At last

    8. OPOlivier Pomel23:49

       ... there, there's actually a lot we can, you can do that can work. You know, so the dream of, uh, instead of waking you up at two AM so you can fix your software, uh, having the machine-

    9. GTGarry Tan23:59

       Doing that.

    10. OPOlivier Pomel24:01

        Doing that.

    11. GTGarry Tan24:01

        The machine gets wake up-

    12. OPOlivier Pomel24:02

        Yeah

    13. GTGarry Tan24:02

        ... woken up.

    14. OPOlivier Pomel24:02

        And then the following day it tells you, "Hey, by the way, I fixed it. You wanna check it out?" That's a much better experience.

    15. GTGarry Tan24:07

        Yeah.

    16. OPOlivier Pomel24:07

        And that's, that's actually within reach now, so that's pretty

14. 24:10 – 26:25

    AI Inside Datadog

    1. OPOlivier Pomel24:10

       cool.

    2. GTGarry Tan24:10

       How about, uh, your own internal use of AI? Like, uh, did you transform the company?

    3. OPOlivier Pomel24:16

       Yes. I-

    4. GTGarry Tan24:17

       And like what can you share, like, uh, how do you work today?

    5. OPOlivier Pomel24:19

       Yeah. I mean, look, the biggest, the biggest impact is on the development side. Like I think most, uh, software companies-

    6. GTGarry Tan24:24

       Everyone is using CloudCode or-

    7. OPOlivier Pomel24:26

       Yes. Yes. I mean-

    8. GTGarry Tan24:26

       Or coding agents

    9. OPOlivier Pomel24:27

       ... everybody across the company is using it, and it's, uh, it's helping every single s- side of the business. But There's much more upside on the engineering side right now than there is, for example, on the sales side.

    10. GTGarry Tan24:38

        Mm-hmm.

    11. OPOlivier Pomel24:38

        Like, you know, you, you... Yes, you can improve productivity a little bit, but you're not going to multiply productivity by, you know, two, three, four, ten. You know, like, maybe you can, at least in some parts of engineering.

    12. GTGarry Tan24:48

        At least we are not there yet, but-

    13. OPOlivier Pomel24:50

        Yes

    14. GTGarry Tan24:50

        ... who knows?

    15. OPOlivier Pomel24:50

        Yes. Uh, but the, I think the killer apps have been invented for engineering. They haven't been invented yet for some other areas. And so my co-founder actually stood in front of the whole team a couple of months ago saying that, you know, within two quarters we mostly don't write code anymore, and-

    16. GTGarry Tan25:06

        Was that two quarters ago approximately?

    17. OPOlivier Pomel25:07

        He was-- Well, it was a few months ago, so.

    18. GTGarry Tan25:09

        A few months ago.

    19. OPOlivier Pomel25:09

        You, you know, we, w- I think we're on the, on the same schedule as most companies, you know-

    20. GTGarry Tan25:12

        Okay

    21. OPOlivier Pomel25:12

        ... like all most, uh, uh, tech companies, where we had an epiphany in December. Uh-

    22. GTGarry Tan25:18

        [laughs] New models, capabilities-

    23. OPOlivier Pomel25:19

        Yes

    24. GTGarry Tan25:19

        ... kind of like step change.

    25. OPOlivier Pomel25:20

        Exactly. New models, and also maybe a little bit of, uh, free time for some people to experiment. Um-

    26. GTGarry Tan25:25

        Like it's, uh, it was the, the Christmas holidays. Like-

    27. OPOlivier Pomel25:27

        Yes. Yeah

    28. GTGarry Tan25:28

        ... and, uh, and then, uh, and then everyone could tinker-

    29. OPOlivier Pomel25:31

        Yes

    30. GTGarry Tan25:31

        ... discovered how powerful the models have become.
15. 26:25 – 27:40

    Advice to 2010 Olivier

    1. OPOlivier Pomel26:25

       you know. Mm-hmm.

    2. GTGarry Tan26:25

       What would you tell 2010 Olivier when you were just starting? What kind of advice could you give yourself?

    3. OPOlivier Pomel26:30

       Yes. I would, I would tell 2010 Olivier that, uh, it's, it's gonna be tough, but it's okay. [laughs]

    4. GTGarry Tan26:36

       [laughs] Okay.

    5. OPOlivier Pomel26:36

       And actually, I, I believe strongly that all of the hardships we've had, um, they've, they've really helped us, uh, survive, get stronger, you know. So we, whether that's the rejections initially-

    6. GTGarry Tan26:49

       Yes

    7. OPOlivier Pomel26:49

       ... um, and a lot of the culture came from that, or, you know, we, like, uh, I think 10 years ago we had a serious security incident also.

    8. GTGarry Tan26:57

       Mm-hmm.

    9. OPOlivier Pomel26:57

       And that also completely transformed our approach to security and our approach-

    10. GTGarry Tan27:01

        You're probably much better today because of that incident.

    11. OPOlivier Pomel27:03

        Y-yes, exactly. Exactly. So everything that was very traumatic-

    12. GTGarry Tan27:07

        Mm

    13. OPOlivier Pomel27:07

        ... uh, I think in the end had a positive, uh, impact on the company, so that's good. That being said, um, I think, uh, m-moving faster, always, always decide faster. I think the advice-

    14. GTGarry Tan27:18

        Yes

    15. OPOlivier Pomel27:18

        ... I would give myself is decide faster. Yeah.

    16. GTGarry Tan27:20

        Decide faster on, on what? On product? On people? On-

    17. OPOlivier Pomel27:22

        Product, people. Usually people. P-product, I think you, uh, you get better at deciding fast over time.

    18. GTGarry Tan27:27

        Yeah.

    19. OPOlivier Pomel27:27

        People, it's really hard to, uh-

    20. GTGarry Tan27:30

        The hardest part, right?

    21. OPOlivier Pomel27:30

        Yes. You know, and that's always, like, you know, h-hiring, firing. That-

    22. GTGarry Tan27:34

        Mm

    23. OPOlivier Pomel27:34

        ... there are two things that you, in general, you should be faster. You-

    24. GTGarry Tan27:37

        Should be-

    25. OPOlivier Pomel27:37

        Whatever your instinct is, it's too slow.

    26. GTGarry Tan27:39

        Um,

16. 27:40 – 29:06

    Hire Slow, Stay Sane

    1. GTGarry Tan27:40

       did you hire enough people, or do you think you hired... It took your time to hire? And I'm thinking about team size because, like-

    2. OPOlivier Pomel27:48

       Yeah

    3. GTGarry Tan27:48

       ... one advice we always give is to, like, don't hire anyone pretty much before product market fit.

    4. OPOlivier Pomel27:53

       Yeah.

    5. GTGarry Tan27:54

       Do you feel you should have hired faster there?

    6. OPOlivier Pomel27:56

       We-- I think we were always on the slower side.

    7. GTGarry Tan27:58

       Okay.

    8. OPOlivier Pomel27:58

       Um, so we, you know, even when we were growing like crazy on the business side, like we were not doing more than doubling the size of the engineering team-

    9. GTGarry Tan28:06

       Okay

    10. OPOlivier Pomel28:06

        ... every year, for example, things like that.

    11. GTGarry Tan28:07

        So you are very conservative-

    12. OPOlivier Pomel28:09

        Yeah

    13. GTGarry Tan28:09

        ... compared to your cost.

    14. OPOlivier Pomel28:10

        Y-yes, and, and mostly we, we wanted, didn't want to break everything. Like we, we saw some, some companies, m-many of them are our customers, that, um, had pretty dysfunctional, um, engineering teams because they 10X'd the size of the team over 18 months.

    15. GTGarry Tan28:26

        Yes.

    16. OPOlivier Pomel28:26

        And we thought it's not helping anyone because it's... What you do when you do that is you, um, so first of all, you, you lose all short-term productivity because all you're doing is, uh, hiring and, and ramping up new people. Uh, and then you have a huge risk that things are gonna blow up and, you know, then you'll be set back for another year or two after that. So we thought, "Hey, maybe we'll leave a little bit of business on the table because we'll be undermanned, but we're going to, uh, cap the, the growth rate of the engineering team."

    17. GTGarry Tan28:56

        It's probably even more true today. Like you can do so much more with the same team-

    18. OPOlivier Pomel29:00

        Yes

    19. GTGarry Tan29:00

        ... in engineering. Awesome. Olivier, thank you so much for joining us today. It was awesome to have you.

    20. OPOlivier Pomel29:05

        Well, thank you for having me.

    21. GTGarry Tan29:06

        Thank you.

Episode duration: 29:08