Dropbox CEO Drew Houston: How to Pick a Co-Founder; Steve Jobs' Attempt to Buy Dropbox | 20VC #938

Drew, I'm so excited for this. I told you beforehand, I listened to your show in 2018 with Tim Ferriss, and I thought, "Who is this genius? I have to have him on the show." It only took four years. But thank you so much for joining me today.

Oh, well, thanks Harry. It's great to be here.

I would love to start today with a little bit of an origin story. So what was the original unique insight you had with Dropbox? How did you get it and how did it lead to the founding of the company, in a succinct two to three minutes?

Sure, yeah. I mean, it was, uh... Kind of as a user, I, I kept forgetting my thumb drive. I had started another company at the time doing online SAT prep, of all things, um, but I needed to work w- from multiple computers. And so I had everything... All of our company's crown jewels were on this little thumb drive that I kept losing or almost putting in the washing machine, um, all the things that used to happen, and, um, it culminated in this. I, I was taking this bus ride from Boston to New York to visit my friends, but I wanted to get some work done for, uh, my company, and I realized when I got on the bus I had forgotten my thumb drive. Um, and, uh, you know, I, I... (laughs) And I wasn't like, "Oh, I hate my thumb drive." I was like, "Oh, I hate myself. God, I'm so disorganized. I need to, you know, be more on top of this." (laughs) . But as I thought about it, I'm like, "Man, I'm just so frustrated with this. This keeps happening. I never wanna have this problem again." And I started writing some code, some Python code, uh, on that ride 'cause I didn't have anything else to do. And, and this was like before you had iPhones and Wi-Fi on buses and things like that. But I had no idea it would turn... what it would turn into, but it was really just a personal frustration.

I, I, I love that. Now, speaking of kind of stories that we have to discuss, I spoke to, kindly thanks to your suggestion, uh, Adam before the show, and he told me that the YC story is the ultimate story of hustle and that I had to discuss it.

Yeah.

So starting there, what was the YC story that we have to hear?

Sure. Well, Adam Smith is one of my best friends, and we went to college together, and, uh, he did Y Combinator, and him... H- and he moved out to California. He got VC f- VC funding. Um, and so all of that, his experience was a big inspiration, uh, to me as, as he was going through all that. Um, and I... Uh, yeah, so I personally had a very winding road into Y Combinator myself. (laughs) So I actually applied in 2005 to the first batch with that SAT prep company, Accolade, uh, and was rejected. Um, and then I was still working on it when I had the idea for Dropbox. Um, and, um, I was getting a little burned out from the SAT prep thing. I'm like, "I, I don't know how many more equation, you know, equations about parallel lines or the train leaving Memphis and, you know, just like all the things with SAT prep you can..." I mean, as passionate about it as you can be, but kind of getting a little burned out, I recognize now. Um, uh, and I was like, "Hey, this might be a good fit for Y Combinator." Um, so I wanted to apply. That said, one thing that was useful from my whole, uh, test prep background was really understanding college admissions. Uh, actually pretty similar, a lot of similarities with something at YC- Y Combinator. You have a lot of people applying for a few slots, so anything you can do to get an edge or a hook would be helpful. So, to me, um, the Dean of Admissions here was Paul Graham, uh, the, the, uh, one of the founders of Y Combinator, and, um, so I'm... I was sort of working back from like, wha- you know, "What does Paul do all day? How do I get in front of my Dean of Admissions here?" Um, and I'm like, "You know? I think Paul probably does what most of the rest of us do, which is just keep refreshing Hacker News every day, which is Y Combinator's news site." (laughs) Um, it's kind of like Reddit for startup news. Um, and I'm like, "Man, if I can get something on Hacker News, like, Paul will see it. This might be good." So I made this demo video, uh, that actually hit the top of Hacker News for a couple of days in 2007. And so there's a link still, it's still out there. You can see I posted this little video, um, and the response was super good from, um, from the community and I... And sure enough, I... (laughs) it, it actually worked. I got an email from Paul saying, "Hey, like your idea, but, uh, you need a co-founder if you're gonna get into YC." Um, uh, and the only problem was I didn't have one, and the inter- the interview deadline was a couple weeks away, so it's sort of like saying, "I, I know you're not dating anyone, but you need to be married in the next couple weeks."