# Selling Drift for $1.2BN is the Biggest Failure: What No One Tells You About Selling Your Company

Why Incumbents Are Slower & Worse Than Ever · Why the Most Valuable Companies in a World of AI Will Not Have More Than 100 People with Elias Torres

20VC · Mar 21, 2025 · 67 min · 14,371 words
Speakers: Elias Torres, Harry Stebbings
Source: https://www.996.fm/episodes/20vc--ep-7eabf8ad/

## Cold open

**Elias Torres** [0:00]:

Is selling a company what we are told it is? Drift is the biggest failure in my life. Like, I wanted to build something great. I wanted to build something sustainable. To walk around in your own company and you don't matter anymore. You bring new CEO, you bring new management. It hurts the ego. Right? And you created this and then you're no longer relevant. I would have a public company right now if if if I if it wasn't for, like, all those carrots that I gave and and candy bars and and and trophies. This is 20

**Harry Stebbings** [0:25]:

VC

## Intro

**Harry Stebbings** [0:26]:

with me, Harry Stebbings, and I'm so excited for the show today. So I always remember the first time I went to San Francisco. I was 18 years old. I was at SaaStr with Jason Lemkin, and the hottest company of the time was Drift. And today, I have one of their founders on the show, Elias Torres. Elias is now the founder of Agency. But before Agency, he cofounded Drift, which he sold for $1,200,000,000 to Vista. And before Drift, he founded Performable, which he sold to HubSpot. But before we dive into the show today,

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**Harry Stebbings** [0:53]:

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## Conversation

**Harry Stebbings** [3:59]:

Elias, dude, I cannot wait for this. Listen. Julian Beck, Pat Grady, two of my closest buddies, said this is the show that we have to do. I'm so thrilled that we can make it happen in person. So thank you for joining me. No. Absolutely. No pressure. No pressure at all. But I wanted to start actually on something that you tweeted before, but it just really kind of hit home for me. You said I don't care a lot. People hear this and many versions of that phrase often from me. The reality is that I pretend I'm a nihilist to cope with the fact that I actually care way too much. I wanted to start with this because at a Jordan Peterson event, someone asked, the depths of my consciousness causes me to suffer. Is it a blessing or a curse to feel so very deeply? And it feels like a deep start. Yeah. But how do you think about that?

**Elias Torres** [4:45]:

It's funny because I tweet not that much and when I do, Halligan tells me, Why are you tweeting? Get back to work, right? And so I kinda don't wanna tweet because it's hard for me. But I really think it's a paradox. Think life is a paradox, right? We always want just one answer. And in my case, I just find myself saying that a lot, I don't care. I don't care. And people are always doubting, like, Do I care or do I not really care? What am I doing? And it's just something that I found maybe it's something later in my life now and the success that I've gotten, my family and all the things that I've been able to accomplish so far, you know, I'm close to 50 now, that allow me to realize what I care and what I don't care about. Right? And so it's been easy. Another thing is that the life of an entrepreneur is really hard. Most people don't want to be rejected. Right? Most people don't want to be told no. And so I've been said no so many times. I have many people quit on me. I have many people churn as a customer. So you get beaten up so much that you just realize it's just going to be okay, right? And so when I say I don't care, it's not that I don't care, I do care, but I know it's okay. It's going to be fine, right? And so I just don't care a lot anymore. But I do care. You see how complicated it is? I totally do. Do you care less with more money? You care less about some things. Yeah, absolutely, right? We worry so much about like the plumbing broke, know, the car has, you know, do you need new tires? This trip got canceled. You have to pay this fee. So that is a huge release, you know, of stress that I just don't care about that stuff anymore. So that just takes, like, I don't know, one third of the problems. And I'm just like, okay. I don't care.

**Harry Stebbings** [6:31]:

Just pay it. Move on. I interview many incredible founders like you, and often I say, what would you most like to tell your 21 year old self? And so many say, I wish I could tell myself that it would all be okay. Exactly. And I think that's terrible advice because the fear that it won't be okay drives you to succeed. My

**Elias Torres** [6:50]:

advice that I would give is different, right? It is true that things are going to be okay. Wherever you end up, it's going to be okay. It's about complacency is the secret of happiness, right? I would say that what I would tell my old self is that things are not as hard as they seem. That's what I would tell my young self. What do you mean by that? We put ourselves so many roadblocks. We're like, can't start a company, it's too hard, right? And we're like, No, it's actually not that hard. Starting it, finishing and exiting is different. But I think we think everything's too hard. It's like if I tell a random person on the street, You can build an LLM yourself. Everybody's going to say, too hard. Is it too hard? It's really not that hard. The code fits on a page on the screen. It's really that small. That's the thing. It's like everybody thinks it's so hard, it's so hard, it's so hard. It's not that hard. I guess maybe it's because I grew up in a communist country, you know, with nothing and no future, no hope. That everything that I've done, I'm like, shit, that wasn't that hard. Like for example, people on my companies in the past, like we get them gifts, we get them food, we get them like free lunch and they go and complain or like, this coffee is not that great. And I'm like, It's free. If you don't like it, go buy your own. They complain The things that people complain in The United States are like not that hard compared to when you I just came back from Cairo last night. It's tough. You see the slums, you see all these areas. It's hard to live in countries like that. I'm from Nicaragua. Life is not that hard for us in The United States,

**Harry Stebbings** [8:17]:

you know what I mean? Have we lost the grit in The US, in The UK where we have the We Works and we have the nice cultures? I think that's why that's why immigrants do well in startups. Right? Great. I totally agree with you. I do wanna go to that. You mentioned that obviously growing up in Nicaragua. I spoke to Pat, my big bro before this. When he gives me advice, I've learned just to take it. He told me that I had spent a good amount of time on growing up, actually, and moved to The US. When and why did you come to The US?

**Elias Torres** [8:43]:

I came to The US because the home that we lived in was not even ours. So there was a revolution, you know, people we lived in somebody else's home because they left because of the revolution in '79. How old were you? Three in the during the revolution, right, in '79. And so we lived in this home, and then after the the communism, you know, the communist government toppled, like, people came back and they wanted their property back. I had nowhere to live. I was literally homeless. I was just graduating high school. And luckily, because of my grandmother, she crossed a river, an immigrant into The United States. After being there for so many years, she was able to get us a green card, apply. It was the perfect timing. We lost our home, the green card came in, we had to come to The United States. We had no choice.

**Harry Stebbings** [9:27]:

What was it like coming in for you, having grown up in Nicaragua?

**Elias Torres** [9:30]:

I was excited. You know, in Nicaragua, I like, could not have I could never have a car, could never have a job. I didn't you know, there was no no hot dogs, no burgers. You know, you come to United States, and you're like I was so excited because it was the land of the opportunity. Right? I was chasing the American dream. So I I could not be happier to give everything I had to that. Right? Do you think it's still the land of opportunity? Absolutely. It still is. A 100%. It is the place where there is just more and more chance for you to accomplish all of your dreams. And for 5,000,000, even I can buy a green card.

**Harry Stebbings** [10:04]:

I would. Honestly, I'm contemplating it. Yeah. It's like, why not? How did

**Elias Torres** [10:10]:

you find tech for the first time? I lived in LA with my dad for two years. I never I never spent time with him except for this time. Right? It was an emergency. In Nicaragua, there was a forced draft. You had to go to fight the war, civil war. And so my mom called him up and she's like, You have a dad. I'm gonna send you to LA so you don't get taken to fight. And so I was like, I don't wanna go to the mountains to fight, and I get to meet my dad. Let's go. And I get to go to The United States. So I met him, so I spent there about two years, and, he bought, like, a stolen computer. Like, people came and sold him, you know? And so I he put it in the garage, and he said, go play with it. And so that's it's like an IBM computer, like, you know, in the eighties. And I would be typing my homework in this printer in WordPerfect and using Lotus one, two, three. That was the beginning. I think that planted the seed that I was just attracted to this device what it was able to do. I just enjoyed it.

**Harry Stebbings** [11:04]:

Do you think entrepreneurs who are brought up in wealthy families are advantaged because they have connections, because there is some forms of nepotism sometimes available? Or do you think actually having nothing shows you how bad it can be and how much you want it? Grit is everywhere. Right?

**Elias Torres** [11:20]:

It's it's not distributed only to the people who have nothing. We just get beaten up so much that we we develop it in larger quantities. But my kids are going grow up differently, right? They're going to have ability to work with my companies. They're going to have my network. They have my access. They have my money. I wrote a post on LinkedIn when I said, Quit now. You're a company. Big company. It's time. Don't worry about that bonus, don't worry about that title, don't worry about that salary. And then my daughter's like, dad, why are you posting such things? Not everybody has the luxury that you have today. I didn't have the luxury that I have today when I first started. Right? I have the right to post that. I'm not making stuff up. And she goes, yeah, the problem is me. I can't say those things because I had those all those things from the beginning.

**Harry Stebbings** [12:02]:

I speak to many very successful people who are jumping around, I'm loving this. And they all say that one of the biggest challenges is how do you bring your children up when you have a lot of money to be as hungry and as gritty as we had to be.

**Elias Torres** [12:15]:

Yeah. I just try to manufacture adversity. That's all I can for them. The good thing is that I've had I had success when they were older because I had my kids so young. So they're only starting to get spoiled now. Like, you know, we're in London here, the whole family, and I said, you guys wanna go to Cairo for the weekend? And they're like, we wanna see the pyramids. That would go hard, they said.

**Harry Stebbings** [12:34]:

You mentioned that typing away on the little IBM computer in the in the garage. IBM was your first job, I believe. Yeah. Absolutely. Talk to me about that and how that impacted you.

**Elias Torres** [12:44]:

You know, it's like IBM was I worked in a very special group. Right? This is this is the group that put ibm.com on the Internet. Right? But what I learned was that a 400,000 person company just can't move as fast. Luke Gershner was the CEO at the time and wrote a book called, like, Why Elephants Can Dance. Right? And I don't think I disagree with him. Elephants can't dance. I don't buy it. Right? They they claim they're dancing, but they don't. They can sing maybe.

**Harry Stebbings** [13:10]:

Have we not seen bluntly over the last year or two years that elephants can dance? Adobe moved incredibly fast on product. Google moving incredibly fast in terms of integration of LLM's and building. We're seeing the biggest incumbents move at speeds that we've never seen them before. How do you think about that? I completely

**Elias Torres** [13:27]:

disagree. I think these elephants are just talking, they're singing. They're talking a big game. It's mostly talk. Google fucked it up. You know what I mean? It's like, can I curse here? Is that okay? Yeah. Yeah. I'm 100%. This is Britain. No. Oh, there you go. Pollocks. I think that Bollocks was the first one. You get wanker, then you're really British. Okay, great. Great. We get there. And so I think that everybody's talking about how Google is struggling. Google just dropped the ball, Right? They invented this transformers paper, and everything they put out doesn't work. Like Notebook LLM, the great one, like, it's already dead, right, the project. So it's like they're trying so hard, but they can't do it. Microsoft Copilot. I felt like Microsoft, I was really impressed. I felt like Microsoft was moving. Investing in OpenAI was genius. I mean, is like, as a businessman, like, respect. Satya is the man, no doubt. And being that early, dropping all that money on OpenAI was genius, changed the world, right? I mean, that is respect. And they had the advantage to adopt all of this early, but Bing, you know, search, you you have repressor, they dropped the poll, right? Copilot, everybody was like, they're just ahead making all the money first. The problem is people are, they just have so much hard time trusting someone, right? And so they're reaping the benefit of being early, but nobody's using the product. It just doesn't work. The king is Chad GPT, right? That's the one that everybody's adopting and using it every day, but that's not the real solution. That's not the future. Copilot, Cursor is second, distant second. Right? The elephants are not dancing. They're trying to dance. Okay.

**Harry Stebbings** [14:58]:

I mean, I I've got Would you agree or disagree? So I'm just gonna take one by one. Otherwise, I'm not gonna have any coherent structure. Google, I completely disagree with you. I think the fundamental thing is access to consumers and distribution. And when you look at all the endpoints they have to consumers, is the product there today? No. A 100%. But their ability to access billions of people

**Elias Torres** [15:18]:

with

**Harry Stebbings** [15:19]:

You

**Elias Torres** [15:19]:

said, are they moving? I did not argue with distribution. Yes, we're in agreement. Distribution, they win. And the other one is they have the points, they have the data too. Those are great assets that they have. But it's been like three years. It's been like five years since we had GBT.

**Harry Stebbings** [15:35]:

Totally agree with you Is that facts? No. I I no. And so I I completely agree with you there, and I will accept that one. I'm forward looking buy. Oh, okay. Okay. Forward looking buy. Microsoft I think, actually, Microsoft, I completely agree with you in terms of Copilot. I think they will get amazing adoption, though. I think it's very much like Teams, where it's like, but actually, fuck it. In large enterprises, people just take it because

**Elias Torres** [15:59]:

Distribution.

**Harry Stebbings** [16:00]:

Distribution is is the biggest advantage that the incumbents have. But does it matter then moving fast if actually you can be slow Mate, as long mate, you

**Elias Torres** [16:09]:

asked me if it was speed. I responded to the speed question. I don't think they're moving as fast as we think they are. It looks fast, but it's not yet.

**Harry Stebbings** [16:18]:

But does speed matter then?

**Elias Torres** [16:20]:

Thousand percent. It's like, that's the

**Harry Stebbings** [16:22]:

only thing that we can Why? If if we can just wait for someone else to build it, could technology commoditize this, and then we can embrace it into our distribution advantage?

**Elias Torres** [16:30]:

Speed is everything. Speed is what creates the American dream. Right? It's it's it's the opportunity. Speed creates the opportunity for others to win. Why did you think ChatGubt wasn't the answer? I'm gonna give you this insight. Right? I think software that has been built in the past twenty, thirty years had the assumption. It was built kinda like we build cars. We build a car all around and we build the entire environment so a human goes and drives the car. It requires an operator. The future is not going to require operators. It's going to be building like driverless cars. They're completely different, right? Except that we are stuck with the roads and the signals and all this stuff. And so imagine when we can completely change transportation, right? What we're thinking is that we need to be building software with the assumption that I don't want to know how to drive the car or do all this effort. I just wanna tell it where I wanna go and when I wanna go. And maybe choose the route.

**Harry Stebbings** [17:24]:

If we just start on a little bit of cool You see that, right? I totally get that. So ChatGPT still assumes that I have to use it. Is it not I'm asking here, not saying. Is it not step function wise, so moving towards SaaS? Absolutely. It's like the levels of

**Elias Torres** [17:38]:

autonomous driving. So it has

**Harry Stebbings** [17:39]:

to start here, and see with Operator now, it does more and more of that full workflow process.

**Elias Torres** [17:44]:

That's the future that I'm, like, visualizing. Right? How do we get to, like, a truly agentic world, right, where where the LLM is doing the work for me?

**Harry Stebbings** [17:52]:

I just wanna start on a little bit of causation there. Why can elephants not dance? I saw a recent post from Owen at Intercom, who's a friend, and he was like, everything I know about management is Yeah. I saw that. Of course. Of course.

**Elias Torres** [18:05]:

Why can't elephants dance? The number of people. Humans. We're the blockage, right, in terms of adopting AI and technology. You know, my last company, Drift, before we sold to Vista Private Equity, right, it was 800 people. I was consumed. I mean, I know big companies that have, you know, a thousand product managers. Just try to picture that sales force, right? Most of those people like, nobody gets fired for saying no. So everybody, like, will not buy the right product or will not build the right thing, right? It's easier to just coast. When you start spending all this time, all these people focus on promotions, on like, I gotta go home, I'm working too hard, I have to send an email at the end of the week saying five things I did this week. It's like, you're toast. That's why they don't move fast. You have to get all these approvals. You know, when you're a CEO of a public company and you spend all this time reporting and analysts and press and all this other stuff, how much time are you spending with the customers? How much are you spending building the product? Who has the vision? Who makes the big decisions? Conventional

**Harry Stebbings** [19:05]:

management lesson that we're all told do you think

**Elias Torres** [19:06]:

is most

**Harry Stebbings** [19:07]:

bullshit?

**Elias Torres** [19:08]:

One on ones. It's like if you're not working with the person every day, why do you need this special time to go talk to this person? I hate it when somebody says, Elias, can we talk? Oh my God. You know that's not good.

**Harry Stebbings** [19:19]:

They're the worst messages.

**Elias Torres** [19:20]:

And then when you go into those one on ones, nothing happens. Why didn't you fucking tell me like when we're in that one on one? And so like, if my whole schedule is filled with one on ones, shoot me. Like right now at Agency, I have no meetings with anybody. We're like 15 people. We have one meeting for the whole company, for the whole team. Show me what you did yesterday. Show me what you're gonna do today. That's all we do in that meeting. The rest of the time, I'm selling or I'm helping customers. But at some point that doesn't scale. When you have 50 people, can't do that. We just create five groups of 10. And that works? Absolutely. How do you think I built HubSpot with the team? We created a small team so you go operate in. You own that product. You're

**Harry Stebbings** [20:00]:

responsible for that product. Why can't elephants become cheaters? And what I mean by that is when we look at, say, Twitter, massive reorganization of the structure of teams, the size of the company. Why can't elephants transition to this new world?

**Elias Torres** [20:14]:

That's what they're kinda like in a pretzel. Right? Every generation, industrial, commercial, Internet, SaaS, Web two point o, whatever. Right? It always assumed that larger was better. Everybody's dream was I want to build a large company. We're entering a new world where the new proposition, smaller is better. I mean, we always known smaller is better, but because we couldn't achieve billions in revenue without more people, We had no choice. Every big company today started small.

**Harry Stebbings** [20:43]:

So we will have much smaller companies with billions in revenue. That's the potential. That's the potential. And that is agent fueled because we have to fill the It has to.

**Elias Torres** [20:52]:

You can't keep hiring. I had 800 people. I had had 200 in CS. You know how hard that was? I have public companies, friends of mine, right, that they're like, Elias, help me with agency because I'm spending 30,000,000 on CS. And it's not even the money. I have the money. We can kind of make it profitable. I can't hire fast enough and train them to support our customers. And then layers and managements and benefits and recruitment and onboarding. You understand how that just bloats all that up? If you could train an AI to do that job and just have straight compute do it 20 fourseven, Which one do you prefer? And so that's gonna lead naturally to what? Smaller teams. It was not possible before. Now we have a hope. We are optimistic that that is possibly the future. Maybe it doesn't work out that way. Right?

**Harry Stebbings** [21:37]:

And people say those AI providers will be actually larger than previous software providers because you are transitioning the budget from a kind of tool budget to a labor budget. Absolutely. Do you stand by that, or do you think actually traditional companies will not accept that transition from tool to labor budget? It's gonna

**Elias Torres** [21:54]:

take time because the people making the decisions if the person at the top is making the decision, you know what they're going to decide. But when you're dealing with everybody in between, I get a lot of rejection right now. CEOs are making a big mistake right now. They're like, I talked to them and they're like, Yes, this is what I want. I'm down. Elias, let's get agency in here right now. And then they pass me down to the next person and to the next person. I'm just telling like it is, right? I'm just, you know, this is my future customers. But I want CEOs to be held accountable, right? They say they want to make their company better and more efficient, take care of the customer. When the decision trickles down, I'm an enterprise sales guy, right? I'm an engineer, but, you know, turn sales. It's so like, I'm navigating the enterprise, right? So what should they be doing? They should be owning that. They should be owning that decision. And they should make sure that they drive it. But that's why I'm telling you, I see that in a company that has 2,000 people, what do you think is gonna happen in a company that has 4,000, 10,000, 20,000, 40,000?

**Harry Stebbings** [22:46]:

And you get resistance when you are pushed down to people. All the way down, you get resistance.

**Elias Torres** [22:50]:

Right? And then when I bring her back to the CEO, they're like, oh, yeah. Told the team to focus. It's too many things. Yeah. Yeah. I'll get back to you next quarter. That's why those companies are not gonna last if they don't change fast enough.

**Harry Stebbings** [23:02]:

Just going back to a statement you said earlier about kind of smaller teams really dominating the future. I'm a venture investor. Smaller teams means less funding required in a lot of cases. In a

**Elias Torres** [23:11]:

lot of cases.

**Harry Stebbings** [23:11]:

Yeah. Does this threaten the traditional venture model or change it in a way?

**Elias Torres** [23:16]:

I think we will have smaller teams, but we still need more compute. I mean, we're just really trading people for compute. So maybe not,

**Harry Stebbings** [23:22]:

right? If you're trading people for compute, does that change your equity to debt desire? And what I mean by that is Yeah. Absolutely. Of course.

**Elias Torres** [23:29]:

Of course. Because a lot less equity will be spent on on on the team because you're not gonna need rounds and rounds and and and distributing equity after every round to

**Harry Stebbings** [23:39]:

hundreds and hundreds of people. Which is interesting. So then it's like early financing remains, but growth financing becomes actually debt financing on more predictable revenue basis. Absolutely. In a world of AI, what changes about the way that you start companies?

**Elias Torres** [23:53]:

Oh, everything needs to be done faster. Right? The skill sets that you need, right, the people that you're looking

**Harry Stebbings** [23:58]:

for is very different. Right? How do you respond to the common suggestion that actually we'll just do different things? We'll find more ways to be productive, creative, and actually we won't reduce workforce, we'll just be more productive.

**Elias Torres** [24:10]:

That's bullshit. It's just you have had some guests here that I love and respect, but they're like, oh, yeah. We're we're gonna get larger, you know, in five years. And I'm like, what? I just saw something somebody posted on Twitter. It's like, oh, we're gonna hire a thousand new sales reps. I'm sorry. It's like if we're building the promise that we're going to, you know, AI is going to do the work of humans. I think that humans are going to do things differently, but at different companies, maybe their own companies. It's like, why don't we go serve other people? Why we all have to be focused on all the B2B companies in The United States? There's the whole world out there. There's so many niches. There's so much things that need to be built to improve the lives of other human beings. Why are we all focused on the same market? So

**Harry Stebbings** [24:49]:

you do not worry about the future of human labor and productivity?

**Elias Torres** [24:52]:

No, let's go travel, let's go feed, let's go farm. Like, I would go plant, you know what I mean? If I wasn't building agency, like, I'll go have a farm and, like, plant some, like, you know, beans and just watch them grow, right? There's other things we could do with ourselves. I wanna learn how to paint. I just was at the Grand Egyptian Museum. Like, I wanna go study that stuff. I wanna learn it. I wanna have fun. I wanna think about different pharaohs and kings. There's so much we can be doing, right? I love the I'm way not gonna be like, let me take another job at Salesforce. That's great. No. You don't want a job at Salesforce? No. I

**Harry Stebbings** [25:25]:

was hoping to set you up after this. You got connections? You know anybody? You know, me and Mark go way back. You know, I had to email him 53 times to get him on the show. He I got him. I like it. Great. I got him. I get you. I spoke to so many of our mutual friends. You mentioned the 15 people that you now have with agency. I spoke to Halligan, obviously. I spoke to Dharmesh. I spoke to Pat. They all said that you're literally the best they know when it comes to recruiting, which I thought was really interesting to have that one commonality from all three as your single biggest strength. And so I have to start. You recruited Andrew at Klaviyo, Whitney, who's now HubSpot CTO, Chris O'Donnell at Day Now. What is your hiring criteria? Everybody wants to

**Elias Torres** [26:01]:

know the secret. Right? My my hiring criteria is high agency. Have to have IQ, you have to have grit, you have to have execution speed, you have to be obsessed. The way that I recruit, I'm a weird engineer. You know, people done all the psychology tests on like my teams that I build and they're all like, This is the most extroverted engineering team I've ever seen in my life. And it's like, they're all so intense. They all talk to the customers. I tend to not hire like that many introvert engineers. What happens is that the way that I recruit is so intense. I'm so in your face. I need you to make a decision now. I'm gonna ask you to go on the most dangerous expedition ever gone. You know, we we gotta take HubSpot public. You know, we gotta build Drift from scratch. You know, we have to create, you know, fastest blah blah blah this to a 100,000,000 in revenue. And so that just scares so many people. I just rub so many people the wrong way during my interview process.

**Harry Stebbings** [26:56]:

What do you think rubs them up the wrong way? The fact that you challenged I'm

**Elias Torres** [26:59]:

just too intense. I'm too intense. Like people are like, calm down. People go put glass door reviews, right? It's like, I hate an interview with this guy at HubSpot. I hate an interview with this guy at Drift. Right?

**Harry Stebbings** [27:08]:

How does your intensity show itself? It's like the speed of your questions The speed

**Elias Torres** [27:13]:

of my questions is how I probe. Show me, open up your computer. I wanna see your git right now. Show me what you committed. Show me your code, let's discuss that, did you really build that, who was it? So I'm just like, I don't care about my questions. I just go bang, bang, bang, bang. Wanna Do see you

**Harry Stebbings** [27:28]:

worry that that in some cases will not get the best out of the person for someone who is maybe shy? That's the test. That's the test that I

**Elias Torres** [27:34]:

do. If they can handle me and they wanna work with me, then that's that's just what has made the teams work that I attract.

**Harry Stebbings** [27:41]:

Do you think you need to change your management style to get the best out of different people? What I've learned is, you know, we often say, kind of, this is the culture, and that culture is like this homogenous unified thing. And actually, some people benefit from the carrot, some the stick. And I need to change who I am as a leader to get the best out of them.

**Elias Torres** [27:58]:

Good luck. Why? I don't want I'm done changing for people. Right? I don't care. It's like it's like, you know what? Screw all that. Know what I mean? It's like, look at Drift, we had 800 people. It was like, I hired coaches, watch me, give me feedback. Elias, you should be more carrots here, more this. And that's why I would have a public company right now if it wasn't for like all those carrots that I gave and candy bars and trophies.

**Harry Stebbings** [28:28]:

Unpack that. What do you mean you'd have a public company if you hadn't had the carrots

**Elias Torres** [28:31]:

in Like I sold the company to private equity, right? Why wouldn't I wanna have a public company? I don't know. Maybe I don't want a public company. Do you consider Drift as short and short of its success? Drift is the biggest failure of my life. Like, I wanted to build something great. I wanted to build something sustainable, right, enduring, right, that the customers keep using and getting value out of the product, right? Why did that not transpire? Too many people. My problem, my fault on the product, growing it, not making it better. You you want to make a product that customers receive value right away, right? What did you not do with product that you wish you had done? Speed, execution, the timing was off, right? I was so close to the LLM's being there to transform like what I'm doing now, so I'm excited for what I'm doing now, right? I get to start from scratch and that's really good in a way. I wouldn't necessarily want to be transitioning to a large ship right now. It was tough. I don't think it was my greatest accomplishment, right? It's like I let people down, I let my customers down. I don't want to do that again.

**Harry Stebbings** [29:31]:

Why was it not salvageable? Why was it not a case of we can transition this into a public company? The way that we

**Elias Torres** [29:37]:

build companies, they're too big, too inefficient. Right? To be able to make things salvageable, like you said, right, these big companies that now, right, if they do what Twitter did, if they reduce themselves to 20% and build an amazing product and are willing to break all their pricing models and revenues and change all of that, then they will survive. Talk to me then about the sale process. Was that difficult for you? I told you that nothing is hard. It was not difficult. It's like But accepting I'm an immigrant. Yeah, I'm just saying. But I'm just such a realist, right? I accept what it is. I don't let my pride try to, you know, my pride gets the best of me a lot of times, but I'm not going to be I think that that was the smartest thing I did, right? It was not be emotional about it. A lot of people, even my investors, would be like, Yes, you're worth 1,000,000,000 now. You could be worth 2 or 4. They multiply my equity times that. You know, look at all the other companies are growing. It's because I did this in September 2021. Right? And so there's a lot of peers of mine that were like, 4,000,000,000 valuation or stuff like that. And so we started a little bit earlier in some of those waves. They were getting crazy valuations like hopping, you know, other companies, right? And so like outreach, Manny is a good friend of mine, right? He's in London. And so you see all this stuff and that affects your ego. Like why am I not being valued when I'm a similar company? Sales lot was valued at two, right? And so How much did you settle for? 1.2. 1.2.

**Harry Stebbings** [31:04]:

Right. Can I be super blunt? How much did you get take from that?

**Elias Torres** [31:08]:

I'm not I'm not saying that. I say enough, it changed my life.

**Harry Stebbings** [31:10]:

Fuck you money for sure. Okay. So fuck you, money. How do you think about that relationship to money?

**Elias Torres** [31:18]:

Like I said, it reduces a lot of the physical and material stress. Such a blessing from an immigrant that had nothing to not worry about like, you know, I focus on the small stuff, right? Get a car whenever you need it, stay at whatever hotel you want, fly to wherever you want, eat wherever you want. That's just like the basics, you know, it's great not to worry. I believe a lot in assistance, you know, eventually we'll have them with AI. Like, you need help. I think people are wasting their time trying to be all frugal or this. I want to focus my time on the customers, right? And my team and my people. I don't want to do anything else. Before we go back to By the way, throw me all these

**Harry Stebbings** [31:53]:

questions that were not on list. Oh, don't mind. It's cool. I always do this to my you clearly haven't seen all the shows. We're gonna go to customers, but I do just wanna stay on the hiring. Is there a process? And has the process changed over time?

**Elias Torres** [32:06]:

Yes. Big difference. So I used to be intense. It was a numbers game, right? And we wanted more, more, more, more. And so like I had to go really fast and I would force people and convince people and I would convince more people than I should have. I could convince anyone. I'm a good recruiter, right? But I've realized now that that's not the same, right? Now this time, I'm pushing back. More people know me now. More people know my reputation. More people want to join. It's important to not fall. There was people that would reverse engineer my process and they would know how to talk to me in a way that would just touch the right points. Now, it doesn't matter what you say to me, I have to reject, reject, reject, push back, push back, push back, right? And so like you don't handle the push back, I do a lot of contracting now, you have to work for me part time. So either you're available or you're not, you need to show me your grit. How much work can you do while you're doing something else? I used to hire fast, fire slowish. Now I'm hire slow, fire fast. People never fire fast enough. Like every time I fire someone, right? Even though I'm a good fire now, right? It's like, I would always like, everybody knew, right? It was so hard and it just became harder and harder. Think about the the large incumbents, how long it takes them to to to fire people. Years. Years. Right?

**Harry Stebbings** [33:24]:

I mean, in in, like, Germany, it's almost structurally impossible to fire someone.

**Elias Torres** [33:27]:

Europe no. No. Let's not talk about Europe.

**Harry Stebbings** [33:29]:

We're in

**Elias Torres** [33:29]:

Europe. But in The United even in The United States

**Harry Stebbings** [33:31]:

like we're in Europe.

**Elias Torres** [33:32]:

That's true, sorry. We can say anything we want about Europe. Let's not talk about Europe. We're sitting in the middle of London. So what happens is that people just need to be more careful. I think my advice I give to early founders is that that's the problem with early founders, right? They have so much more to learn of, like, they have all these high hopes for all these people that they hire and don't realize that most likely they're gonna be let down because it's gonna take a long time to develop that intuition for recruiting. And so now I just, like, you know, I had a guy working for me, like tried one week, then he's like, didn't get anything done in a week. I had a whole bunch of young kids that I hire out of college and they all started early. I hired five kids from Northeastern in one day. Before, all my companies, I've built them on the backs of Northeastern students. They're amazing people. They're the best. I love the university. All my kids are going there. I used to hire one or two every time. My co founder was Northeastern. He was early in founding engineer at Drift. This time I saw one and was like, Great, who's your friend? Oh, let me see that GitHub. Oh, who's your other friend? Let's see that GitHub. And so I made five offers, they all started working. Then I hired them. How do you onboard five new people in a day? Just tell them, Come to my house. Have a chef, we cook them lunch, ship all the laptops to the house, and then we just ship code that day.

**Harry Stebbings** [34:46]:

And that doesn't cause dysfunction, misalignment when there's only 15 people? No, that was like,

**Elias Torres** [34:51]:

we're like, okay, we're gonna do like two or three times more than we did last week this week because these people are here. And whoever doesn't make that goes.

**Harry Stebbings** [34:59]:

And they know that coming in, that it's kind of Absolutely. I wanna unpack a couple of elements. How quickly do you know when someone's not good enough? In

**Elias Torres** [35:07]:

reality, most people should know, like, within the first week or two, they just reject those signals.

**Harry Stebbings** [35:11]:

Can you get rid of someone after a week or two without You it? You should.

**Elias Torres** [35:15]:

I'm getting rid of people during the interview process in the first week or

**Harry Stebbings** [35:17]:

two weeks because they're interviewing. The hard thing for people often is they hire someone two weeks in they're like, they're not good enough, but it looks so bad if I get rid of them after two weeks. Barely giving them a chance.

**Elias Torres** [35:28]:

Ego. Right? And so those people that are making those decisions are not changing their process. They either have to do more research, more interviewing, more testing, or finding the right talent, or doing the right reference checks, right? Or they need to be willing to do that or be more upfront. And that's why I tell people, I'll pay your contract an hourly rate. Let's work. And I let them be. Show me what you got. Are the best hires always obvious? Yes. No, not true. Because I've hired thousands, right? There's so many people that you're like, Wow, what a diamond in the rough, right? So there's a lot of those. I have time to find them.

**Harry Stebbings** [36:04]:

I actually find that often boring people in interview processes tend to be the best hires because they actually tend to never be as boring as they actually are in an interview process. Oh. I never say anything

**Elias Torres** [36:14]:

about boring. Boring is great. Right? I've had people that my team interviews, right? And they're like, Leah, this guy's not good. And I'm like, let me go back in. I go in, really quiet, really shy. But they had grit, they got shit done, they showed me their code. I And go back to the team and I'm like By the way, the way that I ran interview at HubSpot and Drift, everybody, I would help, I have a panel of people interviewing, but I would always interview myself. I would do the informal, I would do the formal, I'd bring them in, and then I'd do the closing. But I let them interview and have fun and tell me what they think, right? So they're like, No, no. And then I just do whatever I want. I just make the hiring decision regardless of what the panel says, right? So I'm always like, No, we're hiring this person. Many times they'll be like, that was really good. And they're better than the people that we're interviewing. Those are the compromises I was making before. So now I'm getting leaner and leaner and just finding the best of the best.

**Harry Stebbings** [37:08]:

When you've made mishires, what did you not see that you wish you'd seen?

**Elias Torres** [37:12]:

The biggest failure in the mishires was myself. I saw it, but maybe I was desperate. I needed to build things, you know, I needed help. And I convinced myself that it was gonna be okay.

**Harry Stebbings** [37:24]:

A lot of SaaS founders will listen to this and go, I I get it, Elias, but you know what? I need some fucking sales reps. I know. Know. That doesn't I'm gonna I need to hit my numbers, and my VC is telling me that I need this, and I need to hit the quarter. So like, they're good enough, but are they perfect? What do you say to them in that position? Listen,

**Elias Torres** [37:43]:

I've been there. I hear you. I feel you. I've done that mistake. Right? I tell them, don't hire that person. And they're like, no, no, but I need to hire this person. And so I just see people living this lie, right, that they're like, convinced themselves they're gonna still do it. And then they hire this person and they keep them for two years, you know, people that I let go, right, people that I made a mistake on. And then they go, someone else takes them and they industry just keeps taking these people over and over. And I'm like It's unbelievable. They go, oh, well, they work too much for this, so it must be good. It's like Exactly. Do you reference? Do you ever call me? Call me. Right? If you call me, you'll hear the truth, because I don't wanna lie to a founder, but then people do it. I'm just saying this is how the industry works, but here I am.

**Harry Stebbings** [38:21]:

I'm saying here I'm the truth. So so one of the things I hate when I look at CV slash LinkedIns is bounce as I call them, which is like two years Drift, two years HubSpot, two years, two years, two years. It's like At at least two years is better than, like, a year. People are hiring people that are bouncing every year. You Americans are incredibly promiscuous when it comes to jobs. But, like, do you agree with me in terms of hating that bounce bounce bounce? Thousand percent. And anything else that's a real red flag when you're looking at people's tracks? Everything is a red flag. If you stayed there

**Elias Torres** [38:49]:

for a long time, it's a red flag too. Why? What's your slope in there? Well, I mean, you can see if there's tidal acceleration. Exactly. That's what I'm saying. But but I mean but even tidal acceleration doesn't mean anything. That's why you have to probe deep when you're interviewing. What did you do?

**Harry Stebbings** [39:04]:

I always find great people use data, not great people use stories. Yeah. You said title acceleration doesn't mean much. I saw on your Twitter that you're not a fan of titles, and you think titles will be removed. Why do you think that, and why are titles not useful?

**Elias Torres** [39:18]:

Because we're just ego driven humans. Right? We just wanna build empires. We just want everybody's obsessed. I mean, how many how many young people I've hired, right, that they pull me aside and they said, Liz, can I get a shot at being a VP at your company? Like, you know, early days. I'm like, you just graduated college. Back off. We're just obsessed with all that stuff, right? And so I'm looking for people that don't really care about that. We have to change the way we reward the team, right? Whether it's going to be profit sharing, revenue sharing, right? Whether it's going to be more equity, just higher salaries, right? These are things that I'm thinking about constantly, right? If I'm going to have 100 people, billion dollars in revenue, right? How am I going to compensate them? How am I going to retain them or not? They can't handle the first, you know, they maybe they burn out after two years, then take a break. Here, take your equity. It's gonna be worth billions. No. Millions. Alright? Maybe billions. And so we go and we say, go start something else. Right?

**Harry Stebbings** [40:10]:

I am a founder today starting a company in this age, and I'm listening to you. What can I do to change the reward slash incentive structures of companies to make it better for my teams?

**Elias Torres** [40:22]:

All the companies I've been at and I participated, maybe I was naive, but it wasn't I was never calculating how much money I was going to get. I was doing it for the love of the game, right? Being in that world and creating, compared to my IBM days, right, and being frustrated for not being able to do anything and people just leaving at 05:00 and not caring, oh, I'm an SDSM, I'm a distinguished engineer, and I get to go home and do some pottery, kill me, right? It's like I wanted to be in this, right? And so creating, building, impact, talking to my customers, busy all day, working for them, working with, having experiences with my team. And so like if you don't want to be in that, don't do it. If you're in it for the money, forget about it, right? Join the party and come and create value and then the rest will take care of itself.

**Harry Stebbings** [41:07]:

How do you think about that distribution of profits effectively? As you said there, you've got the equity, you also have profit distribution, you can do dividends. What do you think that is most effectively?

**Elias Torres** [41:17]:

Let's get to profitability, right? Let's see how we build this company, right? Let's see what Pat supports, right? What Sequoia wants, right? Is your mindset towards profitability in the

**Harry Stebbings** [41:26]:

journey different from what it was in previous years?

**Elias Torres** [41:29]:

Yes. We we it was something that we were taught not to worry about it. Right? In in the past. Like, ZERP. Right? It's like profitability was never a discussion. I mean, Pat gave me a class on free cash flow at one point in time. Some big players in the Sequoia portfolio doing things like that. But now I think about a lot more. I'm thinking more about enduring company more than anything else, right? Whatever that takes, right? If I can make this profitable for a 100 people and then I can make something less longer, you know, I'm more driven about legacy now than I am about money.

**Harry Stebbings** [41:59]:

How do you think about the a focus on profit today reducing the growth potential of tomorrow? Like, you will make trade offs in resource allocation to hit profitability earlier that will hamper your growth.

**Elias Torres** [42:11]:

David Cancel says to me all the time, it's always both. It's a paradox. Right? He told me. Yeah. I had to ask you both. Yeah. What what does this mean? The problem is that, you know, so the the I was a psychic and he would be always like and he's like, just build me another CRM or build me another marketing automation platform at Drift. And I'd be like, which one do you want? Do want a CRM or do you want a map? Do you want a chatbot or do you want this? You know? I would always like make him choose and he would always be like, I want both. I go, do you want a quick product or do want a great product? You know, engineers always want to like, we go back and say, you know, that's the co founder. Do you want this or do you want that? And his answer was always both. And it took me a long time to learn that, right? That yeah, you have to focus but not a simple clear answer. You have to do more than one thing at once. The same is with companies, right? I want profitability, right? But doesn't mean that the rules are changing, right? The success of a company depends on its brand, depends on its product differentiation. Those things don't change, right? How do we scale it and how do we grow it? There's not one one company to rule them all, right? Cursor is great because it could grow so fast, unbelievable. But that's a different style of product. Right? It's something

**Harry Stebbings** [43:22]:

but you can you can gain it easily and you can lose it easily. One thing that I'm worried about actually is funding cycles for traditional enterprise companies. And what I mean by that is I am a little bit younger than you, but I still grew up in the similar kind of SaaStr days, so to speak, of like triple triple, double double, and the expectations revenue wise on founders were those. Now we have several companies, as we've seen, go to $50,100,000,000 in revenue in a year, two years, and the revenue expectations have now changed so much. I worry that there is a generation of SaaS companies that will not get funding because they don't meet the macaws, the mid journeys, you name it. It's

**Elias Torres** [44:03]:

it's really bad. Right? Because there was a moment in time where we were worried about profitability, you know, past ZERP, right? Where we were like, now we're going to build better companies. And now we have Cursor and now everybody's like, I want the same. And so luckily I'm not falling into that peer pressure, right? What really care is how do I gain the distribution of lifetime customers? I'm working on doing that at scale. That's what I'm out here to prove. Right? The cursors and all that stuff, like, you can easily switch to, like, Windsurf and you can switch to this and you can go back to Copilot and, like, so that revenue could disappear. This is a brand new phenomenon and we do not know how it plays out.

**Harry Stebbings** [44:38]:

Do you think a lot of VC money is burnt in this wave? VC money is always burnt.

**Elias Torres** [44:43]:

VC is a small asset compared to the rest of the stuff that happens in the world. Go to Dubai. Go to all these other places. It's an exciting place. American dream.

**Harry Stebbings** [44:51]:

You said something that I need your advice on. You said that you've got good at firing. It's not a nice thing to do. I think it's hard for especially younger founders. What would be your biggest advice to me on bluntly how to get good at letting people go?

**Elias Torres** [45:03]:

I've learned to not make big promises that I cannot fill. You know, people don't realize when I'm speaking how accurate I am because I've had so many conversations before. I'm not promising shit to anyone. Right? I'm like, I don't know. All I promise you is like a lot of work and me yelling, you know, that's it. I promise you that.

**Harry Stebbings** [45:21]:

Do you enjoy fundraising? Hiring and firing, sadly, is a crucial part of being a CEO. Do you enjoy fundraising? Not really.

**Elias Torres** [45:28]:

Right? I mean, I think I like deals. Right? I I like, you know, whether it's I'm hiring someone, close the deal. Whether I'm hiring a customer, closing the deal. Whether it's fundraising, yeah, closing the deal. I love that. I love that excitement. You know, when we were selling to private equity, right, I was we had some bankers that that the board asked me to hire, but I I didn't really need them. But, no, I mean, I was like, I like this job. This week, this would be great. Like, just every month, just like having two or three deals on flight. So I like doing deals, in reality, I'm a relationship guy. Right? And so I care more about what happens after. I care more about the relationship I have with the VC after. Like, I love Pat. I love Izzar from CRV, Bialecki, Larry Bond from from General Callers. Those are my Jewish uncles. And, like, I like people. I like being with people. I love Bialecki. Is selling a company what we are told it is? There's pros and cons. It's sad to be nobody, right, to be to walk around in your own company and you don't matter anymore. You bring new CEO, you bring new management. It hurts the ego, right? And you created this and then you're no longer relevant or that you couldn't take it further. And so it was a great experience for me to be the post Drift days. I spent like seven, ten months traveling and trying to find myself. It was a tough journey. There's people that done some nice graph of what happens in the depression and the sadness and you're nobody, you have no job, you have no meetings. But it was great. I needed that break. Do you think you still have an ego? Of course. Everybody has an ego. Ego is dangerous, but ego ego drives us too. It's kinda like the the care, don't care.

**Harry Stebbings** [47:02]:

I spoke to Julian before, and he told me that you're an advocate for having children as soon as possible. Why do you think that's This is big

**Elias Torres** [47:11]:

I

**Harry Stebbings** [47:11]:

got

**Elias Torres** [47:11]:

enough friends. Let's not make any friends here. Let's go. Why do you think it's so important to have kids early? When I was growing up, everybody was like, we have too many humans in the planet. Yeah. I remember this. Global population will be

**Harry Stebbings** [47:22]:

32,000,000,000. Oh my god.

**Elias Torres** [47:24]:

And now the problem is the reverse. We don't have children. Like, societies are going to collapse. I mean, that's what we think, right? I just think that, you know, we have Brian Johnson trying to, like, stretch longevity and things like that. But I don't think we're far away from figuring that out, I think. We're farther away to figure out how we can have healthy babies at a later age. So I think that the best time to have children is when we're younger, unless we have unlimited resources, right? But even then, your health, your ability. We have improved the possibility of having children with IVF and those things, but I've heard that the journey on that is really hard. It's really difficult. I was very fortunate. I met my wife when I was 17. We had our first child. I was 27. I have three kids. They're like 18, 19, and 21. It's my squad, right? They're my team. So what happens is that they're like, Can we go to Amsterdam now? You know, this week. I'm like, No, I got to work. And so you guys can go, have fun. So I think that I'm so blessed, right? Because most people think it's one or the other, but in reality you can do both. Not gonna be pretty, it's gonna be ugly. But while everybody was How

**Harry Stebbings** [48:31]:

can you do both? I mean honestly I did it. I

**Elias Torres** [48:33]:

mean my wife is incredible. She was at home, we had these kids, but I would work all day at IBM and I would go home and it was like dinner time, bathing, put them to bed and doing the dishes. Just exhausting, no sleep, commute, no money, no help at home. We were far away from our family. Was horrible.

**Harry Stebbings** [48:52]:

But I think entrepreneurs are like athletes. This sounds awful and arrogant and so I might have to edit this out. But, like, I have a very honed life. It's incredibly selfish. Yes. Everything that I do is so that I can perform better and be the best that I can be in different respects. When you have the kids and the wife, you are no longer the most important thing. Oh. That that sleep schedule goes to shit. Oh. And your ability to inspire in that meeting is completely off. Your ability in fundraising meeting, it's all you're not performing at peak. It's just we

**Elias Torres** [49:23]:

have different different definitions of peak Because I was able to do all that. I raised hundreds of millions of dollars going through all that stuff. Right? You have three kids at home that they just don't take a break, they don't take naps, and you're just like, I am exhausted. It's Sunday afternoon. Can I take a nap? You can't, right? So it's like, it was horrible. And everybody would be talking to me in my younger days, what'd do this weekend? And I hated that question, you know, in IBM, right? Because they were like, oh, I went to Egypt for the weekend. And I'll be like, what'd you do? Well, I spent all day dealing with outages from the company, from the startup. And my wife would be like, Saturday, let's go out. Let's get out of the house. And I'd like, okay, I'll be done coding this feature that I'm finally without interruptions by noon. And then we'll take the kids off. And it'd be 3PM and I would still be coding, right? And we would go to the beach and I would carry my laptop and David would be like, buy me like a modem or something. It's like, I need to respond. And if there's an outage, who else was gonna do it but me? My life sucked. I never traveled. I never did anything but work and the kids and the family. Right? I traded it off. Now I get to go wherever I want. Right? But unfortunately that I was able to build a company, be successful and have my children, I'm more than blessed, I'm more than grateful. I can die happy today, right? Other people over the friends, they either were successful or they had family and now they want to go and start the next journey in their lives, right? I was able to do both. But regardless, when you have everything, when you have money, when you have all these things, if you get to a later age and you don't have kids, and not that everybody should and I'm sure people are going judge me, like, What if I don't want to have kids? Respect me. I'm fine. But the reality is I see, like, we want something more than just material things, and and and having a family is is a great thing.

**Harry Stebbings** [51:10]:

I've just become an uncle for the first time, and it's it's I've seen your pictures. You're getting softy. I suck. I do. I love this. A beautiful little girl. My question to you is, your wife is the first woman that you met in America, I think. Yeah? Like when you were 19. Okay. 17. 17. After so many years of amazing marriage, what would be your biggest piece of advice to someone listening on how to sustain an amazing marriage?

**Elias Torres** [51:33]:

She's always right. You see, I can't get my wife to apologize anything no matter how right I think I'm right at work all the time, but not at home. And so, I don't know, it's just the first thing that came to my mind. We always talk about that. But it's really about that selfishness. Right? It's that you have to realize that it's not about you or it's about this you know, I think social media has ruined us of thinking what a perfect most of us what you see on social media is is about

**Harry Stebbings** [51:58]:

you? And I don't mean that badly, but you mentioned Cairo. You mentioned Amsterdam. You mentioned the nice things that they have. Well, now I'm being more selfish now. That's all enabled by you. Yeah. It is

**Elias Torres** [52:07]:

all

**Harry Stebbings** [52:07]:

about you.

**Elias Torres** [52:08]:

It is, but we were supposed to go to Cairo. I have a friend, and he invited me. And then my friend wasn't responding, so I said to the kids, Let's go to Amsterdam instead. And my kids were like, We wanna go to Egypt. Okay, okay, let's make it happen. Right? And so, I don't know. I think you have to balance the selfishness, right? Yes, we are selfish beings, but I'm telling you is that you get a lot more pleasure when others are around you. It has to be a little bit less about us.

**Harry Stebbings** [52:32]:

On the father side, when you think back over the twenty one years of fatherhood, anything that you know now that you wish you'd known when you became a father twenty one years ago, when you were 27?

**Elias Torres** [52:42]:

I guess what I saw their parents or whatever in the past, like for example, my kids are like, you know, the five love languages. My kids love languages is touch. All three of them. My daughter says from you dad, I want words of affirmation. So I've learned to be more overcome that like, oh, I don't want to be this dad. We had these images. And so on one side you learn to be more loving and caring. And the other side, I wish I would have been tougher with them. And so like right now I try to be tough too, right? And it's like, because nothing compares to how I grew up. Beating the shit out of me, like by my mom, like, and I love all that. I love my mother because of what she did at the time with what she knew, but she may be tougher. And so I think that we are too soft. We're too soft on our kids. Yeah. But what do we do when they say they want words of affirmation? You can give them words of affirmation and be tough at the same time. Back to the paradox. Right? Words of affirmation doesn't mean that you can't be tough when you're like, I gotta manufacture adversity. You gotta be tough, man. You can't be weak. You can't be soft. Has there ever been a time

**Harry Stebbings** [53:39]:

when you felt like you were letting them down as a father?

**Elias Torres** [53:42]:

All the time. Right? Because it's like, did I I saw all these parents, you know, that were older when I was working. Right? And they'd be like, I just restored this car with my kids. And my kid is an Olympian and my kid is going to be like a pianist, world pianist. And I'm like, shit, had no money. I couldn't do tutors for them. I couldn't do any of that stuff. And so then I was like, maybe I'm gonna teach them how to be engineers, right? And that's one thing I could teach them how to code early. And I still feel like that because I was so busy. It was either doing the dishes or or or making sure the systems were up at the company. And so I felt like I

**Harry Stebbings** [54:15]:

let them

**Elias Torres** [54:16]:

down,

**Harry Stebbings** [54:16]:

but I ask because I I think I feel like bluntly a constant failure because, you know, I'm a founder of a media company, an investor, a son, a brother, a boyfriend, an uncle. And at every moment, a board member, at every moment, I'm letting down multiple people.

**Elias Torres** [54:31]:

Yeah. But the reality is that no one can do a perfect job for anyone. And so what matters is what you're able to do in the good moments, right? And whether it was a tough lesson or whether it was some great words of affirmation or touch, right? So that's kind of why I don't care. Like I have regrets. It's like, I'm trying to do the best I can and I do good things because I'm thinking about them. But I don't worry if I don't do a 100% of what you wanted and what she wanted and what they wanted. It's like I'm just like, hey. I'm doing. Leave me alone.

**Harry Stebbings** [55:01]:

I wanna finish on you retweeted Marcello Clor's tweet on the commonality of failure in great people's careers. And I think it's a really interesting question, which is like, what was your favorite failure? And a favorite failure is often attributed with great lessons, great takeaways on how it changed you.

**Elias Torres** [55:18]:

Mean, I think Drift was a was a great failure. Right? You know, it's it's both. Right?

**Harry Stebbings** [55:22]:

Well, you sold it for $1,200,000,000, so it's a bit of a cop out of a failure, my friend.

**Elias Torres** [55:26]:

It is. It would but it is. Like, like, I'm saying is, like, look, what I've learned was Do you think David saw it as a failure? Yes. I mean, think I think just look at HubSpot. Right? HubSpot is my is my is my thing there. Right? It's like, look. It's a $30,000,000,000 company. Brian and Dharmesh get to still be involved. From an ego perspective, that that's like nice. It's better than Drift. Right? And so I think that that's what I wanted to build. But I made mistakes along the way that didn't create the foundation solid enough to grow that. Klaviyo, you know, I'm first investor, good friends with Andrew, right? You're the first investor in Klaviyo? I convinced him to take VC money. Woah. How much did you put in? It's great. And so what happens is I'm sure I have him on the show. I know, of course. The thing about it is that you go and you do that, and look look, he has an amazing $10,000,000,000 company. Right? And it's it's a fantastic, you know, free cash flow. I still

**Harry Stebbings** [56:20]:

think it's super underappreciated.

**Elias Torres** [56:22]:

A thousand percent. So that's why I'm not selling my stock. But here's the thing. Right? It's like, those are role models for me, but this time, I wanna do it my way. And so that's what I'm doing. That's why I'm in this journey all over with agents.

**Harry Stebbings** [56:34]:

You're an investor also. Correct? You've made quite a few investments. How has investing changed your operating mindset? Investing is really hard, man. It's

**Elias Torres** [56:42]:

a You're telling me. I I I respect that. You know, that's why I could've come in I could've gone and become a VC. I had a dinner with with David for, like, two hours one day because we're gonna start a firm, you know. And he's like, oh my god. So many bottles of wine later. And he's like, I can't believe Bialecki gave me like two hours to explain how a VC firm worked. And I'm like, after that conversation, was like, no fucking way. Why? What made you say no fucking way? Because I'm a builder. You can build a farm. No. But the thing is that I hate seeing people that are like, I'm gonna build it this way. I'm like, no. That's wrong. That's not gonna work. I was like, oh, no. You don't under it's when I see how much gap there is between where they're going to be after that experience and that journey, I'm not interested in in working through that journey with them. You know what I mean? And and asking people for money and and and me making bets, then I have to advertise and build a different style of brand for myself, I'd rather build, man. It's so much easier, so much more fun.

**Harry Stebbings** [57:37]:

Why did you take VC money? Respectfully, you could self fund. Why take VC money for agency?

**Elias Torres** [57:43]:

The reality is that I made like $2,000,000 in like just over like six, seven months consulting AI. Was I working with OpenAI, I was servicing their customers. I was just like sweating it out there, like learning LLM's because I, you know, I thought I missed the boat. And so that I worked with, you know, Red Bull, Ticketmaster, the NBA, Klaviyo. That's I kind of where the idea for You ran for agency

**Harry Stebbings** [58:05]:

$2,000,000 doing consulting?

**Elias Torres** [58:07]:

Yeah. What? Yeah. What were you doing? I was just working in coding and solving problems for them. For OpenAI? For OpenAI's customers. Know, they they people would go to OpenAI and they're like, I need help me do this. And they're like, we don't help you build that stuff. That's your problem. And so they would send me leads and I had to work the leads and started charging like 25 k a month. And then like, you know, slowly things became a $100,000 contracts. Some of became $500,000 contracts. There's money to be made.

**Harry Stebbings** [58:34]:

Right? So I I actually tweeted that AI services companies will be bigger than actually AI technology providers Yeah. In next five years.

**Elias Torres** [58:42]:

Yeah. Do you agree with that? Humans are the biggest blocker to adoption, and they're gonna need a lot of hand holding and help. Because we don't have the agents that we that we and the workflows and the new products and the new models. Right? In the meantime, it's a step function that we need people to handhold them.

**Harry Stebbings** [58:58]:

And last one, and then we'll do a quick follow-up. It's a horrible question because I hate the line. Oh, timeline. What do you think? You think that there will be this transitionary period of five to ten years, or will it be much shorter of kind of twelve to twenty

**Elias Torres** [59:09]:

I'm on the longer side.

**Harry Stebbings** [59:11]:

You're on the longer side. I

**Elias Torres** [59:11]:

think there's a lot of hype. This stuff we're not gonna even in the in in the industrial age and revolutions, right, GDP was growing at 1%, 2%. I don't think we're gonna grow like a 10%, 20% in one year all of the sudden because most of the money, most of the the industries, right, are are even slower than adapting tech. Tech is being extremely slow to adapt this technology.

**Harry Stebbings** [59:33]:

It's funny. Satya said we misappropriate success in AI to AGI. And actually, the way that we should appropriate it is 10% increase in GDP.

**Elias Torres** [59:41]:

Sure. I'll bet. How much? I'm not a betting member. Let's drop some money on this if you want. Oh, don't wanna I don't wanna drop some money on this. Alright. But he didn't set a timeline. That could've that

**Harry Stebbings** [59:52]:

could've been in ten years.

**Elias Torres** [59:53]:

Yeah. I mean, I mean, it's like, yeah. At 10% GDP growth, I mean, world's gonna double and explode so much faster. Yeah. Whatever. When that happens, it's gonna happen. But in the meantime, it's gonna take time for for people to adopt this. And we don't even have the right solutions yet. We just discover fire. Right? The rest is gonna take time.

**Harry Stebbings** [60:10]:

I wanna do a quick buzzer. I say a short statement. Let's start with what do you believe that most around you disbelieve? To be indirect is better. People disagree with that. Yeah. People think that being indirect is better. In action? You can buy and hold one public stock

**Elias Torres** [60:27]:

for the next ten years. I'm scared of the giants. They're not gonna last. But NVIDIA, I think compute, is gonna we're thirsty for compute. What would you do if you knew you could not fail?

**Harry Stebbings** [60:36]:

Educate more people in the world. How do you have such great skin? Julian Beck asked this one. He was asking about his facial routine. Ask him about his facial routine. Oh, my blessing. You

**Elias Torres** [60:46]:

do look very young. I I think it's that thank you. Thank you. I think that the Latino genes, I I I thank the genes. I'm grateful for them. Your Botox doctor told me. Love No. No. No Botox. No. Nothing. Yeah. This is I don't even wash my face. What have you changed your mind on in the last twelve months? I didn't think I was gonna start a VC backed company. I don't know. I I I didn't know what was the right idea. I didn't know that. So I changed my mind. This is the best thing I could ever be doing.

**Harry Stebbings** [61:16]:

What about the way that your mother brought you up? Have you decided to do differently with your children?

**Elias Torres** [61:22]:

I'm letting them do whatever they want. Right? I'm freeing them from my pressure of, like, to be me. They're kind of being me in a way. It's back to selling in relationships. Letting them be. If they don't wanna go to school, they don't wanna do their homework, I don't care. It's their problem. I'm happy. I'm successful. I'm rich. It's up to them. Right? Does money make you happy? No. It definitely makes things easier. What concerns you most in the world today? Extremism, ignorance, people can't have a conversation, it's sad.

**Harry Stebbings** [61:51]:

What's your biggest short in the public markets? Salesforce. I've asked a couple of people that question and everyone said that. And I'm just looking at it, like, oh, fuck. Benioff's gonna fucking kill me. I guess I haven't listened enough, but yeah. Anyway, Mark, do wanna come back on the show? Final one for you. When you look at the next ten years and being excited, I'd like to end on a note of optimism. You know, my mother's got MS. I'm excited for the drug drug discoveries that will come through AI and through, you know, what we have ahead of us. What are you most excited for?

**Elias Torres** [62:22]:

Well, I'm most excited about look. I I just came back from Cairo, and I I got to learn about the Egyptian civilization. It's mind boggling, and I I don't think we studied it enough. The love for art, the love for culture, for craftsmanship, it was so mind boggling and so inspiring for me. You know, we we think that with the evolution with new generations, think we are better, but I think we're we're going worse. You can see in different dynasties and different generations how the the craftsmanship in the Hellenistic era was actually worse than prior to that. And you can see that in the way that we build, right, and the way we treat our customers, you know, with billion dollar companies. I'm hoping, I'm optimistic, that we can get back to that and that we can build better products, better customer relationships, better businesses, more art, more culture, more time with our families. Like, I'm optimistic that that could happen.

**Harry Stebbings** [63:17]:

Elias, listen, my favorite thing about this is being able to have just great conversations that are completely unstructured unstructured and learn from amazing people. This has been fantastic. So thank you so much for joining me today. Been my pleasure. That was so special, Stuart, in person. I wanna thank Elias for being such a fantastic guest. And if you wanna watch the show, you can find it on YouTube by searching for 20 VC. That's two zero VC on YouTube. But before we leave you today,

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