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The Founder Formula
The Founder Formula

Episode 34 · 1 year ago

Rakesh Loonkar, President & Co-founder Transmit Security - Introducing the Largest Series A in the History of Cybersecurity

ABOUT THIS EPISODE

You need these two things to start a company: a really big idea and a plan for how to get there. Our guest today has an absolutely mammoth idea…

Passwordless authentication.

In this episode, we interview Rakesh Loonkar, President & Co-Founder at Transmit Security and four-time founder, about how his latest company achieved the largest series A in the history of cybersecurity with a big idea and a plan.

Join us as we discuss:

  • Why we should do away with passwords forever
  • How to pitch to a VC and what VCs want to know
  • Why Rakesh was drawn to entrepreneurship
  • Focusing on competition versus focusing on solutions  

Listen to this and all of The Founder Formula episodes at Apple Podcasts, Spotify, or our website. 

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If you're going to go start a company, have a really big idea and how to get there, and that, in turn, will help define you as an entrepreneur. The founder Formula Brings you in behind the curtains and inside the minds of today's brave executives at the most future leaning startups. Each interview will feature a transformative leader who's behind the wheel at a fast paced and innovative tech firm. They'll give you an insider's look at how companies are envisioned, created and scaled. We hope you're ready. Let's get into the show. Hey, everybody, welcome to another episode of the show. We are super excited to have you listening in. My name is Todd Galena, and with me is the chief marketing officer here at trace three, sandy salty. Hey, Tot Sandy, I'm so happy you are back again for another episode. There's so much fun. Thanks for having me. Oh, you're welcome. So you and I were talking before we turn the microphone on and we have a new feature, yes, for the podcast that we're launching for this episode. Super Fun, Yep, Yep, and it's the it's called the lightning round, or at least we can get fun. It's it's called the lightning Doround, and this is where, you know, we have a lot of similarly themed questions that we ask these founders to answer. Of course we get into a multitude of topics when we're speaking with them, but what we wanted to do is add some like guaranteed kind of silly levity to the show. So we have some very random lightning round questions. Yeah, okay, so I'm going to ask you one. We're going to test it out and I'll say you don't know which one I'm going to ask. Now there's a list of everybody who's listening and there's a list of about twenty five of these. Sandy, here's my question for you. Would you rather watch a movie on your phone or would you rather go to an old school driving Oh gosh, that is so easy. Oh, without question, a driving I mean that's basically asking me. Would you rather squint for two hours trying to move you on a small device or get a full big screen experience in the comfort of your own car while munching on popcorn? Or you know why? Wait a minute, it's not that easy to answer easy. Okay. So, so, like, what if I said Hey, there's this really exciting movie that you've never heard of, you have to watch it, and you're like, oh my gosh, like I really don't want to let this person down, I'm going to watch this movie, but Dang, that's like two hours of my life, and then some comes you and goes okay, I'm going to give you an offer. You can watch that movie on your phone, like right now, why you're sitting on your couch, or you can get in your car and where we live, you can drive to like the city of Orange and you can have them load this movie up and in it. Now it's like a four and a half hour experience. So that like two minute preamble did not make the question anymore hard. I'd still pick the drive in. Okay. Well, now it's your turn. Okay, okay. So I would ask you two questions. The first is, how many cars is too long for you to pass on a drive through, like you're talking about like a fast food drive through. Yeah, you're getting kind of hungry, you want to pick up some lunch. It's a drive through. How many cars before you're like forget this, I can't I hate long lines and I would have to say if there are four cars in front of me, I would park. In fact, you know, now that you mention it, there's a chick fil a by our house and I will tell you there will be like one thousand sixteen and seventeen eighteen cars like pouring out onto like the main street, and I say to myself, like buddy, like you can...

...get out of your car and go park and walk in. I don't understand anyone who could possibly wait that long. And a drive through line. Yeah, that seems very reasonable. To walk in or the way out, like the parked your car and actually go move your body in order your food. Yeah, but you're willing to sit in the car for long hours watch a movie. depends. Oh well, playing. Good Point. Good Point. Okay, how many cars for you? I mean it would be three, three or four? Okay, good. You know what? I would preface that question with which restaurant is it? Because maybe for in and out I'd wait five to six cars. This is a yeah, maybe three to four. Yeah, in and out tends to turn and burn it pretty quick. The only have like five items. Yeah, okay, I move it to six for in and out. Yeah, plus for California. So it's like you know, in and out all the way. Yeah, my second question for you is large gathering or small gathering? Large Party or small gathering? Better said? Okay, so this is sad. I have a bit of a long answer for that one. So party sizes are weird. So if you have a party that's like ten and less, it's awesome, right, and then if you have a party that's like forty and more, it's awesome. Yes, when, because you know, a small grouping get like a group conversation going, Super Fun, right, but if it gets more than like ten people, then you then you kind of have multiple small conversations going on and you kind of like order they talking about. Oh wait a minute, then in a big, big party you can what you can like pollinate, like you can want around, talk to somebody and then go to see somebody else. You see a lot of people in one in one event. So, but if I had to pick between the two, I would probably go small. Yeah, good about you. Well, no, let's not jump over to me. Yeah, the other thing about a big party for you specifically, is it allows you to disappear without anybody noticing, which is a big todgling, a move, the ghosting move that? Yeah, the ghosting. Yeah, but what big party? Sometimes you don't feel obligated to say goodbye. I mean, maybe I'm a bad person, but like sixty people? No, no, it's you don't want to go and in interrupt the host. Be Like I'm leaving. Yeah, you've you ever made that move? If you ever left, that s goodbye. Oh yeah, okay, okay, I prefer that move all the time. No, I agree with you. I think small gathering all the way. For sure. These are good. Okay, all right, so you ask me too, so I have to ask you to know. Okay, this is a good one. We're not even going to get to the show. We're just important with these letting questions. Once again, people are just tuning us out. I'M gonna listen to another podcast. Okay. What's your most commonly used Emoji? Good one, okay, easy. I have a lot of nieces and one my few and I go, I get a lot of cute pictures. So it's deep Emoji with the hard eyes. Oh yes, that's a perfect one. That's such a sweet one. You know, it's like I wonder if there are people who have like angry, the angry one, you know, or the vulgar one. We have to find out what. I don't know if we should ask that for this coming interview, but we'll see. How I'd like to meet those people. I think they'd be fun to talk to. Okay, what do you say we get to our guests? Let's roll. All right. Okay, as promised, our guest is a serial entrepreneur and for time, founder in the cyber security industry. He's also a private investor who has provided seed round funding for multiple cyber security startups, including Palelelt a networks, Z scaler and arms. The third company he co founded, trusteer, was acquired by IBM for one billion dollars. His latest company has transmit security, where he serves as CO founder and president. They are Cyber Security Company that specializes in customer facing passwordless authentication. Please tell me. Welcome...

...to the show, Rack Hash loon car hey, thank you so much for having me. I appreciate it. Thanks so much for being here at Kash. Well, let's dive right in. So Rick Hash Tott and I are in marketing and marketers love sound bites and headlines, and transmit made some headlines recently. Can you talk a little bit about that? Yeah, absolutely. We raise the largest series a in the history of cyber security, raising five hundred forty three million dollars for our first outside round. That's just incredible. It's incredible. Yeah, congratulations. I'd like to give our audience a little bit of context on why that is so monumental. So I'm going to share some ATS. Ye, please do so. The average seed round equates to about two point two million and funding, and I'm talking, you know, not industry specific. To add, only ten percent of companies who managed trees the seat round or successful in raising their series a, which I was surprised by. Yeah, to say that going from seat to series a is pretty monumental in its own right. The average series a round in the US is about fifteen point six million, and funding for the average being sea rounds, are thirty three million and fifty nine million respectively. So, again, just to put it in context, transmit raises five hundred and forty three million in their series a, orders of magnitude higher than the average, of course, which puts them in Unicorn status. Breck Hash, what's the story behind the five hundred and forty three million? You have to share? I sure, sure. I first I assure you the venture capital industry, the private equity industry, is not totally crazy. So that's the first thing you can probably think in the back of their mind and you have to, you know, unwind that. The actual story is, you know, far more sane and I think there's actually an incredible business achievement behind. You know the numbers that my business partner, Mickey Good Eye, and I have been able able to achieve, of course with the amazing transmit team. So, you know, to know that you have to understand a little bit about the history of the companies. Of the company was started incorporated in two thousand and fourteen. We really launched product to the market in the middle of two thousand and sixteen and with just loaning the company about nine million dollars, which we ended up paying ourselves back over time, the company ended up becoming a hundred million dollar revenue company. Will do a hundred million and annual recurring revenues this year. Our Net retention, which means, you know, it's a representative of how much customers like you had spend more, is really is excellent. It's a hundred twenty one percent. We were able to generate more than ninety million dollars of cash was we by the time we got funded, we had about seventy five million dollars of cash on our balance sheet. So behind that is this incredible business story that just nobody heard of. And the reason nobody heard of is because there a lot of buyers, especially the big buyers, the savvy buyers, who essentially curate their entire it portfolio based on who got funded with how much money. And that's how, you know, tech crunch picks who they write about, that's how the Wall Street Journal does and you know, pick your periodical. And without that validation it's very hard to get customer attention. And so that's exactly what we found, is that we were just not in the echo chamber. People didn't hear about us and it was very hard to get into that echo chamber. Despite this, what I think is an even monument more monumental business achievement of basically starting a hundred million dollar company that's growing at sixty percent a year, accelerating growth without any venture money. And then, I would say the second is that we're a hundred million dollar company. Were growing to five hundred million. And then the next milestone is a billion...

...and what ends up happening is that the executive teams start to look very, very different and you have to bring in executives, and really good executives want to make sure that their equity is worth something and part of that is having a private equity firm or venture firm set the value of the equity so that they know that when they leave their job and, you know, a certain place, that they have an option to make as much or ten times more. And so that's the reason we did it, and it was actually quite a few fast process. We had one venture firm that was trying to get into the deal for seven years and they just said, like, give us three numbers and we'll give you evaluation back, and we're lucky that our numbers were great and they came back with, you know, really great valuation. And we went then to insight partners, and insight was just really helpful introducing us to customers and just also like kind of wonderful to work with, which was unusual in our experience, although we've had worked with many wonderful venture firms. Inventor venture partners. They really just took it to another level and they gave us a term sheet and one day and we raised the rest of the money within a couple of weeks and if we wanted to, we could have even raised a billion and a half dollars because of the health and the underlying health of the business and, of course, the large market we're going after. You kind of explain the process a little bit there and you mentioned insight leading it, but you have far more investors in there. Looks like you have a total of nine. Do they go out and find the other eight? Do you make it available to some, to some other investors who have shown interest early? Yeah, that's exactly what we did. So we had a bunch of investors. Insight was the lead. They set the value and they were very supportive and we'd build a relationship with General Atlantic with, you know, a number of other firms. We have to cyber specific firms there, one called Cyberstarts, another called Sind ventures, which are really plugged into the security community, and then we had another great venture firm called a artisianal and not a firm people have heard about a lot outside of the Silicon Valley, but there they specialize in executive recruitment and they're the founder of that firm. Andy Price, is literally the most connected person in the Silicon Valley when it comes to find any executives, and so we were really honored to have him join the round because we needed to go build an executive team that understands how to run a five hundred million dollar, billion dollar, two billion dollar Revenue Company. That's crazy because when I compare it to the third company you started, trusteer, which was acquired by IBM, my understanding is you guys started with only ten million dollars. So what? What can you give us an idea of what it's like to to have an a round that's half a billion dollars and maybe some of the pressure that's on you and your co founders and your founding team as compared to starting a company with with ten million dollars? Well, it's a good question. I I actually think the pressure is the same. In this particular case, in the context of transmit, we still have full control of the company, where known by the investment community, were trusted by the investment community. They know we're not nuts or you know we're going to we're not going to take the money and have a huge party and Mickos. I think might have to take here money into that. And so, you know, I think that's the first but I think there's nothing like the pressure of being a first time entrepreneur, because being a first time entrepreneur it's very hard to understand what the signal is from the noise and what...

...to ignore and what not to and I find everyone goes through it. It's a right, it's a it's right, a passage. Everyone feels so obligated that they tend to work the twelve hours in the fifteen hours a day, and I think experience has taught both Mickey and myself that that leads to a really bad place and if you don't know how to manage your time and you're not focusing your time to a reasonable level. I'm not saying we don't work our we work very, very hard, but we work smart too, and so that's the difference between you could raise any amount of money and be experienced and it isn't necessarily an emotional drain, and you can raise any amount of money as a first time entrepreneur, and even a second time entrepreneur, and have tremendous pressure on you just because the sheer will to succeed. And also there are a lot of entrepreneurs, and I went through this myself. You think, wow, this is like my time and I'm not going to waste it, and that leads to the huge pressures of being a first time entrepreneur. So I would say that raising this much money is not as stressful as doing it for the first time. Well, guess we're going to come back to the funding and pitching topic, but before before we continue down that path, they want to ask you to tell us a little bit about transmit security and what password list of utication means. Dove, the thanks. Will first what we dislike passwords. They're the root cause of most security issues in the enterprise and especially in customer facing environments. And customer facing environments, they're the root cause of about eighty percent of the attack vectors, including every flavor of account takeover, and they're also the root cause of really bad customer experience. First, because sometimes people don't remember their usern even pass, or sometimes remember the wrong user even pass, where they have to recover their account. They have to do all these things and their application owners who really operate at scale, and I'm talking about not only the ones who have a hundred thousand users, their application owners who have a billion users and they experience these problems, you know, pretty significantly. And then the second is that because people don't trust user named pass where they need all these other controls. They Need Bot control, they need captions. That like everything you experience as a as a consumer trying to get into an APP. And then there are a bunch of technologies in the back end that you don't even see. And then finally, you know they have to do an MFA. Why did you MFA? It's because people don't trust user an password. So I think as an industry there's like this consensus that user named Password isn't good, we should patch it. But there isn't consensus, or at least it's building that just you can get randomviews are even password. And that's what's changed in the industry. We have full platform support now for biometrics across almost all mobile devices around the world, and then there's biometric support for PC's or you know huge, you know critical massive PC's and of course tablets. And then finally, for those devices and users that don't have biometric support, they're really solid alternative ways that are very easy to use, and so that leads to this kind of the essence of the beginning of a really big company, and I think the beginning of a really big company has always started in a very, very simple idea, which is we're going to get rid of name, user, even password, of passwords especially, and what we mean by that is you can delete all the passwords from the customer experience and they're not secretly cashed anywhere, and you could actually delete passwords from password database, and that in itself not only solves a...

...lot of security issues, but application owners, and specifically customer facing application owners, can use it to dramatically improve the customer experience, which of course helps with conversion and that's important for banks, retailers, governments, you name the application, could be healthcare, could be patient records, it doesn't matter. Are Any place that people used to log in. So there's this huge opportunity. There millions and millions of applications out there and we believe every single one of them is going to go passwordless over the next three, four, five years, even ten years, starting today and you know, last year. So that's an enormous opportunity and we think that the incumbents, including the ones you read about every day, are just not going to be able to do it. They'll be there, but we see this very, very clear opportunity to create what should be an absolutely huge company. It sounds amazing, but I am kind of sad that captures going to disappear. You know, it's one of those it's one of those stressful puzzle games that I enjoy so much, like when you when you log in, like Hey, can you which one of these six images right? Do you see a bus? And I'm like, I think I see a bus and all of them, you know, are nine images right. SOTALLY and we're both certainly going to miss recording our passwords in our notes with our mobile devices. I can untill we live in a passwordless world. Personally, yeah, what a great rally cry for a company. Yes, great, I was literally talking to somebody and I was, you know, for the geeks of the audience. If you think about all the star wars movies, you know the entire empire was destroyed by the rebellion because of one password. It was star dust. So if any star wars fancier in there, you know that the empire was crossed by Password. So wait, wait a minute. I'm a star Wars Geek and I didn't know that is at the password where we they found out that that one, like hole, was was accessible on the desk star. Yeah, that's right, that's yeah, it's in rogue one. So in Oh my God, thanks so much. Use boots odds mine. It's Oh my gosh, that's funny. Well, my kids that they rolled their eyes. I love my eyes. Well, let's switch gears for a little bit. She'll be yeah, you are not just the founder and entrepreneur but also an investor, and a lot of companies you've invested in over the years have been either acquired or ipowed. What's the criteria for an exit from your perspective? And the second part to that question is because you've also been the man pitching the concept. When you're pitching to a VC, do you pitch the way out to yeah, they're there. It's interesting. They're really you know, just two different questions, just to give the audience an idea of the companies that my business partner, Mickey The die, and I have invested in and, you know, to give the list. You know well, make you started in Perva, we both started trusteer together and of course both started transmit together, but I was one of the early seed investors in Palo Alta networks. We both invested in Ze scaler. We were both investors and armist I was a early investor, seed investor in szumo logic. We invested in preampt, which was a crowd acquired by crowd strike, fired glass by semantic, a Rato by Microsoft, risk rerecon by Master Card, hyperwise and Lacoon, both by checkpoint and number of others. All, by the way, all the work was done by the amazing entrepreneurs who started those companies. So you know,...

...just kind of you know. I think the first is we make almost every single investment decision in probably sixty seconds or less. It's a combination of first knowing and typically the entrepreneurs, knowing the entrepreneurs by reputation, knowing them personally and or having them referred to us. And what we're always interested in is a new area. So you can kind of think of it is you can think of securities as big Matrix and there's tends to be new areas that kind of make themselves apparent over time and when that happens, you know there are lots of interesting companies that start to solve those problems. And so, for example, we always had malword detection device control on PC's mobile devices emerged, they reached critical mass and then at some point it became clear that you needed, or as an industry, we would need, anti malware on mobile devices. And that was, you know, originally the you know, the observation, I think, a very simple observation, but an observation nonetheless, around lacoon, which was acquired by checkpoint, and the observation around Palo Alto was again very simple, world class entrepreneur in near Zook and that the nature of applications was changing. And you know very simply that stateful inspection had to become application aware, and if it was application aware then an enterprise could implement a lot more security controls. And those are just two examples, but they're, you know, many, many others. So I think that it starts with the team. You know, really simple root cause or simple observation that anybody can explain in one or two sentences. And then, of course, you know, the ability to invest, which is always, you know, we're always invited guests from the various entrepreneurs. I think there was a second part of your question that I didn't answer. No, you. It's a beautiful answer. I think the second part was when you're pitching to it be seen. We can only imagine what that what that's like and what it feels like. But do you do you include the Exit Plan in your pitch? Yeah, so I would break you know, first like what a VC's want to hear in general, and I you know, I think some of this is clische and some of it's not. But what are they really looking for and you know what taps in to their instinct that you're not saying and they're really you know, two or three things. The first is, who are you and WHO's the founding team? And, by the way, is the founding team constructed correctly? So I've seen many times people come with five founders and there really should be two founders and the VC's don't say it, but they're like, Hey, who are these other three clowns here getting a lot of equity? And you know who are on the website, but they're not. They don't really deserve founder equity. And you know, maybe you can hire them as employees or maybe they should be here. And you know, people don't say that in the meeting, but they think that for sure, because at some point the VC's and the earth, the good vc's, really want the valuable unique founders to make money. And and I think the second is, is it a big market? And that's typically cliche again, because everything is a big market. But you have to look at the submarket and have like a real strategy on how you enter from a submarket and then fundamentally change the big market. And you know, the good vc's will really pressure the challenge the entrepreneurs defined and really think through how are they going to go and...

...establish a beachhead in a market and then attack the bigger market and then fundamentally disrupt it? And if the entrepreneurs have really good answers around that, they have a much better chance of getting funded, regardless of who the VC is, because most enterprises fail and if you're going to go and do a startup, you might as well try to do something big, because if you apply the probability of success and multiplied by the potential outcome, you'll see that the outcomes are always much, much bigger and better targeting are really big company and that's, you know, kind of fundamentally the core advice behind you know, to anyone is. If you're going to go start a company, have a really big idea and have an on how to get there, and that, in turn will help define you as an entrepreneur and also define the quality of your ability to be an entrepreneur by how big you think that was. No one's ever laid it out like that before. I can't tell you how fascinating that is. My mouth is a gape in the sense that we've had founders come on that are part of one of ten founders, believe it or not, and so when you're saying like hey, five are there, who are the two that really matter? Is there a score skill set where you look at those two where you're like hey, I love the fact that we have an idea person here, creative person and engineering person, but we also need a financially savvy person, are really good scaling businessperson? Are there certain things you look for in those two, or it just doesn't matter? You know a good founder when you see him. Know it does matter and I would say that most skills in the market can be bought, a generic ones. They're very few skills that are so unique and those are the skills you want in the founding team and it really centers on understanding of technology, market and product. And you know, if you had to pick, it would be technology and product, because if you have a great technologist and they don't know how to productize it, and so I always tell everyone, you know, I have this wonderful relationship with Mickey, but I you know, my business partner and the other cofounder of transmitted trusteer, and you know, but he's the product eye and he I tell everyone, he's worth more than me, and he is, because he's the product person. And for me I bring, you know, slightly different things, but I think the engineering skill set, and it's not just a regular engineer, it's somebody who is an uber engineer who can think of everything differently. So if I think back to my first business partner, near Zook, he is by far, and I think anybody in security would say this, by far the most special engineer in the market. You know, for the last twenty years he's really and you know, he can parse something and come up with a unique solution to just about anything. And then I think Mickey is, you know, just one of the best product people in the security space. And so for you know, for me, I've been lucky to partner, you know, with both of them successfully for various reasons. And then the finance skill sets. I mean you can hire a Harvard Mba, you don't need to give them founder equity and you can hire somebody from Princeton, you can hire somebody from Yale. They make wonderful employees but they don't necessarily have to be part of the founding team. I'm disappointed to hear you didn't mention marketing as a cool yeah, I will actually say not to teat our own horn, but I find that really successful founders oftentimes are the best marketer. Oh and there a great so...

...true, and it's great that you mentioned your sandy and I both been lucky enough to meet meet him and he's a rock star in our industry. Is, as you know, Racash and. and talking about entrepreneurs, let's look stuck quickly about you and your start. So why did you become an entrepreneur? When did that kind of sense start to kick in for you? I think it's an interesting story in the sense of like, maybe just recently I've come to understand it. But the first is that I I was a kid, I always wanted to start a company. I mean since I was eight years old, and you know I have all these like small stories about trying to start businesses and saving money. And the second is that I had this wonderful, wonderful financial education for my father. My father was, you know, kind of this uber mathematician. You know, who has he had? You know, he earned a PhD in chemical engineering and you know he had a corporate job, but he was this wonderful mathematician. He really taught me from a young age how money worked, you know, and I kind of internalized all of this. You know, he helped me get a stock account. You know, started at my I bought my first apple stock when I was thirteen years old and you know, kind of let me then experin decision. So it's only you hold it long age, you hold it now. I sold it after a couple of years. I messed up on that one, but but you think really made up for it. So don't worry about it. I don't know if you know, you know, whole the apple for for that long. It might be equivalent, but you know, I never really realized it. And I have a friend here whose adventure capitalist in Boston. Yeah, I think he has like one of the highest eques of anyone I've ever met and is named is David Fialco, and he started a firm called general catalyst, and he asked me the exact same question. He's like hey, why are you an entrepreneur? And I was like, David, I you know, I actually really don't know and, you know, kind of thinking about it, and he looks at me and he goes, I know exactly why you're an entrepreneur, and like okay, you know, somebody, somebody's going to give me this vs answer, and he said it's very common, but you need to control your own environment and you need to kind of be in control and you need to be able to create an environment around you so you can succeed. And I looked at him and I'm like okay, and I like start to think about it and I had these like kind of chills that kind of came over me and I'm like, Oh my God, I think he's right. And you know, if you think back, I like I worked at HP and I was a horrible, horrible employee. I mean, you know, people were telling me to do this, I wanted to do that, you know that. And like, you know, I saw other things and I just viewed the world differently and you know, I think it goes back to the way I was raised and you know I had this you know, I love both my parents and you know I had a wonderful father and you know I love my mother, but my mother growing up was not mentally healthy. She was mentally ill. She was bipolar, she had depression and, by the way, I noticed a lot of entrepreneurs have the same characteristics with their parents. Nobody wants to talk about it. I don't mind. And you know, my childhood, even though I had these parents, are still you know, you know have wonderful relationships with it was never certain and because of these, you know, kind of mental mood swings of my mother and I think it pushed me as a child to want to be able to really really control my own environment, and that lasted me even in to adulthood. And so I think there's some, you know,...

...really obvious reasons and then I think there's some reasons that I really just became aware of, you know, even though I'm you know, I'm I just turned fifty even today, so I'm still learning. But I I think back to what my friend told me and I realize that he was right. I like to and need to control my own environment for me to be a successful and the only way for me to do that was to become an entrepreneur. Thank you for sharing that. Yeah, I mean just a fascinating, revealing story in your background. That's thank you for sharing. Yeah, when we think about sort of controlling one's environment in the context of business, you know, you often think about competitors and competition in general and facets of of your business that are harder to control. Said, yeah, new companies coming to market, etc. And you know, for a long time, you know, when you ask the founder about how they kind of stay ahead of competition, the sexy, almost cliche answer was always we don't focus on competition, we focus on the client, for the customer. But in it in a field or industry like security, there are new companies launching literally every day. So in that in the context of sort of an inundated industry, is that still the right answer from your perspective? Is that? Would that be your answer? Of We don't really think about the competition, we think about the customer and prospect. I think it's still the right answer and the right it's but I think there's a second part of that answer to and I think it's the right answer because as a leader, as an entrepreneur, you're asked, you know, we're asked that question fifty times a day, and if we keep on focusing on competition, than everyone will focus on competition as opposed to what the customer really needs and that this kind of underlying need and trend that you know, really customers are are. They always have problems and if you're focused on the customer problem, even even in the light of competition and capable competition, you can really win. And so I think, I think that answer is a great primary answer and I think it's true. You know. But that said, one has to really pay attension to the threats and of course you have to understand what the customers own, which, by definitions, competition and whom else, you know, can get there first, and what assets do they bring to the point of okay, what do you say in a pitch that accentuates your positives and depositions the competition in very, very simple ways and very broad ways? And so you know, personally, I watch what the competition does. I care about what they do. Their lots of entrepreneurs who dismiss their competition. I don't do that. I think it's very arrogant to do that. I think people who are arrogant today get crushed and I respect every single one of them for what they do, even though I think we can beat them, and even the big ones. And so, you know, I think it's a it's a combination of both. But you know, you can't win a race by running backwards, you know, that's that's for sure. You have to run forward and run forward towards the customer as fast as possible, and I think culturally that's right and attitude wise, that's right. Well said. Yeah, speaking about the customer, we have a tradition on this podcast and it's to ask our guests to share a gratifying customer experience. I'm sure you had many. Can you have one that focuses on transmit? Yeah, well, well, absolutely. So. You...

...know, we have a number of customers going password lists with transmit. I can't mention the customers names just because I'm not sure they would allow me to, but going password lists is one of these, you know, just things that could be transformational and you end up, you know, really impacting people's lives. So we had this one application owner in France. It's a very, very large financial institution in France, and they just went password lists with transmit for an application that serves twentyzero blind users. Why? Because people had a hard time, even with all the accessibility fast tools and the mobile device and the PC, to enter user name and password and they really like a overwhelming positive responses, which was so cool. Like you know, it just made me feel good about what we do. And the second is one of our very large customers is health insurance plan and they found the same with really old users. So you know, the demographics tend to skew to the older side and you have lots of people of dementia, you know, and have a really hard time with this again, very basic username and password experience and they found that they are the happiest user group. Although everyone was super happy, the happiest user group was the older and oldest demographic that was able to basically log in with this really simple user experience, which was similar to unlocking your phone, which they do, you know, a hundred times a day to look at facebook pictures of their grandkids and so, you know, I think they're both really great examples of how you can be in business, you can be in cyber but you really can have an impact on thousands, tens of thousands, millions and even hundreds of millions of lives and you know doing that every day. So I felt great about it really, and so you know, that's that's one out of many, many stories. For to out of these stories, how can you not be proud of helping the elderly and the visually impaired? I mean that's amazing, pretty profound. Yeah, so we talked a little bit about the right founding team and leadership team and certainly, you know, people shape culture. We haven't had a chance to tap into the significance of culture. We're obviously living in a remote world these days with with the covid reality. Any sort of tricks and tips on how to bolster culture and keep it intact during a time like this? Ra Cash? It's it's a really good question. I think that you have to look at it based on the constituency and then trade each constituency differently. So what we're doing for new employees is we're doing a lot more handholding. Were building opportunities for them to build relationships within the company, even though we probably would not have done that a year ago. It's a bit less efficient but critical to their success and their ability to you know, lower barriers of social conduct and cut you know contact and asking their you know what, maybe an embarrassing question for them, because so they can ask their peer. And so I think we're most careful about brand new employees. For the existing employees, we're trying to create safe environments for people to meet physically. We're, you know, on on ongoing but not every day basis, because just not everyone is comfortable with coming to the office yet and that's still something that worse trying. We're trying to respect in you know this that you know kind of the various phases...

...of the pandemic, and so we have a number of different things and I think the last thing is I think we're not the best at this, but we're really trying to be much better, is, you know, just ongoing communication to try to tether people to the information flow, because information flow outside of the office and this remote environment doesn't flow as easily and so people they assume things when they don't know things and sometimes assume the worst and you have to really counteract that with a lot of information flow, a lot of communication, to the point where we're overcommunicating and even, you know, being repetitive. And so I would say before we was never try to be repetitive, but now we're repetitive purposely, yet cheap reminding officers a term that we use here at a trace three. That's that's great. Okay, so listen, we're about ready to wrap up, but we have something new that we've added to the PODCAST and we're calling at the lightning around. So we're going to ask you three random questions that you don't know what's coming and we'd love to your answer. Sandy, would you like to start to sing the lightning round? Sure to get off with an easy one. I'm a total foodie. If you had to pick one snack or food to eat for the rest of your life, what is it and why? Oh, I would say that's a good question. I would say was Sabi almonds. Their hell good, there's they are pretty addictive. Yeah, okay, Nice, could answer. Okay, so, if you had to walk around the office wearing one of these two items for one week, would you choose crocs or a fanny pack? I would pick a fanny pack. Or what would you do? At least I can keep my almonds the fanny pack. Well, both time. That's because you can get away with anything. I saw somebody wearing crocs the other day in this weekend and I'm like now, you can't be seriously. Yeah, that's funny. If you have to compete in an Olympic sport, which one would it be to be right now, like if you got the phone call like right now and they're like you had to partice speed in the Olympics, but you have to pick a sport. Go now, what would it be? Oh my God, I don't know, it would. It would have to be. It doesn't have to be an Olympic sport, it has to be part of the Olympics. Does Oh downhill skiing done nice? That's me. I think if ricks could compete in let's put it this way, it building companies was an Olympics sport, he'd wingled's leave it at that. I wish so. I think even in that world, you know you'd lose two you know, bezos gates or you know Elon Musk, you know. So never heard about okay, hey, this has been awesome. I learned to yeah, is there is there anything you'd like to share with the audience that we might have missed during this conversation? Racksh no, just I think that's it. I think the last thing is, you know, just in building companies said, I see this kind of consistently. Is the core of any great cultures, integrity and you know, it's the you know, the ability for everyone to trust the system as you build it, and you...

...know that's that's first and foremost. So, you know, I think everyone knows it, but I think that's, you know, every single experience, you know, taught me that. I was new it anyway and it was kind of part of my core and part of Mickey Score. So let's see. I love that. Thanks for the wisdom and for your time. Were in total aw that's that's so kind. So I have to go back to work and hopefully every day we have to prove ourselves. That's right. Well, we'll thank thank you so much, rack cash wheel. Chat with you soon. Okay, thank you so much. I appreciate it. Trace three is hyper focused on helping it leaders deliver business outcomes by providing a wide variety of data center solutions and consulting services. If you're looking for emerging technology to solve tried and true business problems. Trace three is here to help. We believe all possibilities live in technology. You can learn more at trace threecom podcast. That's trace, the number threecom podcast. You've been listening to the founder formula, the podcast for all things start up, from Silicon Valley to innovators across the country. If you want to know what it takes to lead tomorrow's tech companies, subscribe to the show wherever you get your podcasts. Until next time,.

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