From Construction Worker to Billionaire CEO; The 21-Year Epic Journey of Procore to an…

I think I’m equally as excited, Harry. This is I’m a huge fan of what you do, and so this is quite an honor to get to join you today.

I was running a small tech company up in the Bay Area in the heart of Silicon Valley, and my wife told me one day, hey, guess what? And by the way, I was flying all over The United States servicing clients in a completely different industry. My wife said to me one day, hey, guess what? We’re moving to Santa Barbara. And I said, no, we’re not. We live in the Bay Area, I run a business up here. She goes, no, your son and I are moving to Santa Barbara.

We haven’t seen you in months because you all you do is travel. And if you’re not we’re not gonna see you, we’d rather not see you in Santa Barbara than San Francisco. And so very much against my best judgment, I’m I came down here kinda kicking and screaming. And lo and behold, you know, we started building a house, and, you know, she got sick of me complaining about the challenges of building the house. And so she said to me, like, hey. Why don’t you just go out and solve this problem and stop complaining about it?

And that was the origin story of Procore. So it’s all her idea.

Well, it was a really rough time. So we were selling our software to mostly custom home builders prior to the great financial crisis. And, of course, the very first part of the construction industry that fell apart was the custom home biz market. So our customers all went out of business, and so we had this shift really, really quickly to commercial construction. But in that two year time frame that it took for us to kind of make that shift, yeah, myself and Steve Zahn, my co founder, we had to go without a paycheck.

And I’ll never forget Harry having to go home and tell my wife, who by the way, at this point, we had sold everything that we had acquired in life. Like, I had two mortgages on the house, I’d sold a car, I’d sold to make payroll, had nothing left to sell. And I told my wife one day when I went home, I’m like, look, we’re not gonna get paid for a while. And I was scared to death at how she was gonna respond. You know, the the coolest thing of all is that she was like, look, I believe in this vision as much as you do.

Let’s make it happen. We were able to go for a couple of years and just scrape by and borrow money from friends and family just to get by, but we got by.

You know, people ask me this question all the time. And when I think about it kind of in arrears, when I kind of rewind time, I think the one thing about being a founder who’s so devoted to the mission is that you don’t question it. I knew it was a foregone conclusion that somehow this industry, this construction industry was gonna get digitized, and I believed in our approach. I just felt like if people would give me enough time, I was gonna figure this out. So I didn’t really stop to question it, and I’m grateful for that.

Yeah. I think you know instinctually if something’s not working. And and the other thing is is that clearly, Procore didn’t work for years. Right? Like, you know the story. Right? We didn’t really raise institutional money until, like, our fifteenth year. It was a long time. But, like, I think you just know as a founder if it’s gonna work or it’s not. I also believe that founders are usually cut from a different cloth, which is, you know, I always say, like, I’m a dog on a bone.

Like, no one was ever gonna take this vision away from me because I just knew it was gonna happen. And so I could have made a small business out of it, or I could have made a, you know, medium sized or large business out of it. But ultimately, if it wasn’t gonna work, I think you just know it.

It’s a really good question. You have to understand let’s start with the running from, and then I’ll tell you where where I was running to. I was a a horrible student in school. I, you know, was flunking out of school left, right, and center. My guidance counselor told me that, you know, there were probably some good jobs out there for me, but they weren’t gonna be very, lucrative jobs. And I had failed out of college, and I just I was in and I was a carpenter by trade, so I I really had very low expectations of myself as well as what my family thought of me.

Thank goodness I had a trade of being a carpenter, which I have the most respect for. But I decided one day that I wanted to prove everyone wrong, that I wasn’t this person that was kind of a mediocre person at best. And so I was running from that stigma, and I wanted to be prove to myself I was more than what people thought of me as. What changed?

What happened? You know what’s interesting is I think in hindsight, like, look, I’m 56 years old. When I was in high school and elementary school, don’t think that they had diagnosis for dyslexia or whatever, and I’m sure I’m dyslexic. I’m also an autodidact, so I, will if you give me something that I’m passionate about, I’ll blow your socks off at how much of an expert I become at it and whatever else. But I have to be interested in it. And so what changed for me was I found my passion in life, devoted my life to that passion, and that’s why I just never stopped because, like, that’s just my personality type.

And I think that’s why founders are caught cut from a different cloth. You have to have more than just an interest in something in order to succeed. Do you have to love what you do? I’m fortunate that I get to love what I do. You know, some founders Steve’s on, my cofounder. He had a company he took public before Procore. I think from founding to IPO, it was like thirteen months. Right? Some founders are really lucky because you don’t have to go through the years of the dark times to get to success.

For me, I wouldn’t have made it if I didn’t love what we did because we just had so many years of just strife and turmoil. I wouldn’t have been able to sustain it if I didn’t love it. What are you running towards on the flip side? I have this, like, vision, that we are going to be able to connect everybody in construction on a global platform. I think I’m running towards this vision of it being done, which I think a lot of founders lie to themselves too, that there will be a nirvana state in the future where everything is gonna be where you expect it to be.

And I think that’s just the survival instinct that we all have, but I think I’m running towards that. Can

So rewind time to 2002. If you walked onto any construction site in the world, there was no Internet at the job site. Yet I had built a SaaS a vertical SaaS solution to serve an industry that couldn’t actually use my technology. Right? So those were the tough days.

What did you do? We literally Steve, Zobb, and I literally buy airline tickets, go to a customer. We went to Sea Island, Georgia, which is on the other side of The United States. We went to CompUSA, and we bought a router and bought a wireless access point. And then we went to Home Depot and bought a toolbox, and we actually went to the job site. This is like what we used to do. And we would install the Internet at the job site, so a customer could then, you know, pay us $95 a month for our service.

So the the answer to the question was, the Internet was not at the jobsite. There was no such thing as mobile technology at all. The iPhone didn’t come out till 2007, for goodness sakes. IPad in 2011. We just were super, super early, but I knew it was gonna happen. It was the last industry I could I was aware of that had not digitized, and I’d seen all these other industries digitize, and I’m like, it’s just a matter of time before it happens. We just have to be patient.

The more things that have to happen in order for a company to be successful, the higher the risk ratio is. Right? So I would look at it definitely that way. You know, if you were to invest in Procore in 2002, I didn’t even take our first friends and family till 2004. But if you were to invest then, you would have had to believe, first of all, that the construction industry was gonna digitize. Second of all, that the people that work in construction were actually gonna be proficient enough in technology to use it.

Third, that the Internet was gonna need to make it to the job site. Fourth, that mobile applications were gonna be able to untether people from a job site trailer to actually do their job in the field. And fifth is is that people would actually look at these tools as productivity gain tools as opposed to documentation tools. So you all of those things would have had to have happened in order for you to believe that Procore was gonna be successful. You’re not selling it. Well, the risk ratio as an investor, right, is much higher for those things.

By the way, I I don’t know if you know the story of Qualcomm, but Erwin Jacobs, who started Qualcomm, in order for Erwin Jacobs to be successful at Qualcomm, he needed to invent the technology behind CDMA, which was brand new technology and was barely able to be done. He needed to get all the wireless carriers to take all of their infrastructure out and replace it with new CDMA infrastructure. He needed to create handsets that could use CDMA, so he had to invent a cell phone that would work.

And then he would invent the chips in order to make this processing actually possible. You look at that investment, the same thing as Procore. Like, that’s a high risk investment. All those things had to become true in order for them to be successful. But with those high risk investments come tremendous rewards, and I think that’s the way I would look at it.

Well, in the competitive landscape before the great financial crisis, there were a lot of companies out there that were bigger than Procore that were trying to kind of digitize the construction industry. I mean, the landscape was just littered with companies, and we were just like a miniscule little player. And honestly, if we didn’t have the wherewithal to survive the great financial crisis, thanks primarily to one of our investors who kept pumping money into Procore, we wouldn’t have survived. And what’s really interesting is 2010 rolls around, and we look at the competitive landscape, they’re all gone.

It’s a wasteland of just dead companies, and we’re the only ones surviving.

Well, first and foremost, the Internet really had not made it to the job site. They were all kind of betting on the come, and it just hadn’t really been adopted yet. Like, you asked earlier about, like, when was that inflection point. Right? We we didn’t really hit an inflection point till 2015. Between 2002 and 2015, we’d grown revenue from $0 to $9,600,000. Right? Over that long period of time. But from 2015 on, it started to accelerate. You would have to survive from two thousand nine, ten, all the way to 2015 to see this industry starting to adopt this type of technology.

So there just was you had to have enough resources to stick stick it through.

Steve Zahn stopped going to the mailbox every day. And let me tell you what that means. For thirteen years, we would, every day, Steve’s cofounder, we’d go to the mailbox and wait for a check from a customer to make sure that we can make payroll. So every day, would see Steve in the hallway, and I’m like, what’s going on? He’s like, oh, I’m going to get the going to get the mail, so I see if we can make payroll. One day, I caught him in the hallway in two thousand and fourteen, fifteen.

I’m like, what are you doing? He’s like, nothing. He goes, what I’m not doing is I’m not going to the mailbox. And I said, why? And he goes, we have enough money in our account. You know, we have enough revenue now that I don’t have to run to the mailbox every day to check for for checks. So we realized at that point, we had turned some sort of a corner and that it was time to step on the accelerator. We had some product market fit, and all we needed to do was go out and raise some capital to bring this idea to market.

Was that a change that you

The market definitely changed to us. We had not changed anything. We had been building the same product for thirteen years, but the market finally adopted it.

Yeah. Well, trust me. We didn’t just wait either. We did a lot of things as a company that supplemented our income in order to make payroll through those lean years. I don’t know if those were the best ideas, but they kept us alive. You know, customers would ask us to do custom development on a new application. And if if they’re gonna pay us $30,000 for a month’s worth of work, we would literally put two engineers on it and just ship a piece of software that had nothing to do with Procore for them just to keep the lights on.

As they say, the only thing that matters in business is that you survive to fight another day. And so whenever I talk to founders who are like, it looks like it’s all over, I’m like, just the oxygen to the business’ revenue, just go generate some freaking revenue, and you’ll survive.

So you have to understand the dichotomy between Steve and myself. So I’m the carpenter who failed out of college. Right? Steve’s the Stanford grad who, you know, got his MBA at Haas at Berkeley. A lot of these companies, if you think about it, a lot of big successful companies actually have this kind of dichotomy in cofounders. Steve was very much business focused, and he was the one who was, like, making all of the kind of recommendations. So he said to me he’s like, Toohey, I think we have enough product market fit that we could actually go out and figure this out and raise some capital.

I’d always known we were going to and that we were gonna have this opportunity. So I was pretty bought in right off the bat. I was a little intimidated, you know, walking up and down Sandhill Road and, you know, meeting the likes of Brian Weinstein and Byron Dieter and Will Griffith and you know?

Let me take you to an earlier meeting. So we walked up and down Sand Hill Road in 2008. We were a little ambitious in 2008. You know, everything was going up into the right. Our customers were doing really, really well. The economy hadn’t hit the skid yet. So we walked up and down Sand Hill Road, and we went into I’m not gonna name their name, but we went into one of the largest institutional investors that everybody knows. And they put us in the back dark conference room with the junior junior analyst, and we were pitching them on Procore.

And literally, the guy said to me, he goes, look. This is really an interesting idea. There’s probably some opportunity here. But if you did it more like Facebook, we would be interested in investing. And I was like so essentially, they they they kicked us out of the building, and everyone laughed at us. And it was really funny because, literally, they were calling us idiots. They’re like, you’re selling software to an industry that can’t use your software. Like, what are you doing? You guys are idiots. And then it’s funny.

You fast forward to, you know, 2015, 2016, and ’17, and we’re up raising money. And everyone’s like, you guys are geniuses. Like, you figured something out that nobody else has figured out. And it’s funny that I’m like, we’re the still the same person. We’re probably more idiots than geniuses. But anyhow, it’s just funny to have the same people refer to you now as a genius when they were calling you an idiot five years.

Yeah. Then we you know, so I guess what I was saying, was we were a little intimidated going back. Right? Because we had had such a demoralizing experience on our first run at institutional investors. But the good news was we learned it’s almost less about the brand of the venture firm, and it’s more about the partner. Right? And so I got to know both Will Griffith and Brian Weinstein personally, deeply personally. And I spent a lot of time with these with them as well as some other investors that we ended up not going with.

I decided that I was gonna make sure I was gonna be working with people who shared our values and actually were really vested in our success. And it wasn’t just another deployment of capital. This was somebody that was gonna lean in and be very heavily heavily engaged in this journey. And fortunately for me, we found two amazing institutional investors that till this day are on our board, until this day believe in our mission and are a 100% behind what we’re doing. And yeah. So we got very lucky.

First off, like, what was that deal? How much cash did you raise? We raised 30,000,000, I think, in the first one. Do you remember the price? I don’t. I should remember. By the way, I I should remember all of this. I don’t remember. It was well, I remember this. I don’t know if Brian told you this, but Bessemer had an investment thesis on Procore that they, of course, they don’t tell the company about. The best outside scenario they could come up with was that Procore was gonna be worth $300,000,000 in the future.

And we always joke about that because, like, I think we’re a little bit beyond that. Right? But yeah. And by the way, I don’t know if you know this, but we had a co lead on our Bessemer investment, guy named Paul Landress, who was with Brian in the investment. I hired Paul to join Procore after we had done the fundraising, and Paul ended up becoming our CFO. But Paul told me all of the back stories of what the partners were saying about Procore during the investment thesis, and it was kinda shocking that they helped, you

what would you say? One of my biggest challenges, Harry, is that I like people, as we’ve talked about in the past, and I really get invested in the relationships. And some folks, not not the two folks that I’m talking about that are institutional investors, but some investors tried to leverage their ability to kind of manipulate my feelings and make me feel guilty for not going with them and stuff like that. You know, I listened to this your discussion with Scott from Atlassian and how they did the closed envelope fundraising.

I was thinking to myself, I wish we had done that because it would have taken a lot of this. I mean, I literally be getting calls from institutional investors saying, like, you know, you’re taking food out of my kids’ mouths because you’re not giving me access to this deal and stuff like you know, it was it was kind of those kind of, like, guilty things that I just didn’t really enjoy. So one of the reasons why I went with Brian and Will was because they were very, very straightforward with me, and they they just ran a good process.

Oh, it’s funny too. The person that said that to me had flown down here on a private jet, so I was kind of not concerned that their deal was gonna make it so their kids didn’t eat.

Know, it really started within about a year where we would double and then double again and double again and double again. I mean, around 2017, we were rolling. What’s really interesting to me, Harry, is in hindsight, we never stopped to kind of think about what the heck was happening. You know, used to when I was a kid, I was a skateboarder. Right? And so if you’re when I was skateboarding down the hill and you get too fast and you get speed wobbles, you have to leap off your skateboard, you’re hoping that your feet can run as fast as the speed of the skateboard so you don’t fall on your face.

Those years were us running as fast as we possibly could, trying not to crash. So we had no time to kinda think about, like, what the heck’s going on here? I’ll never forget when we got a billion dollar valuation on Procore. We’re raising some private capital. We were all standing in a hotel room somewhere. We’re at a conference, the leadership team, and I was talking to our investors about the pricing the round. And it came up to be a billion dollars, and I’ll never forget. That was a moment where I’m like, I had missed, like, a 100,000,000 evaluation to a billion, and that we were all like, wow.

We’ve significantly grown this business, and it kind of happened without us thinking about it.

I actually do believe that ignorance sometimes is bliss, not all the time. I also think that you can be too smart for your own good. So us having this singular focus on what we were doing and really not trying to just build a business, but actually solve a real problem and satisfy the needs of the customers just kept us really, really focused. And so you can call it naivete or whatever, but, like, that’s all we were really thinking about. You know?

There’s there’s a lot of lessons in there. Right? So up until 2017, we only had one product. It was our project management tool, and it’s still our flagship product. But what we had heard was our customers were they were sick of having point solutions, and so they really wanted to have our platform be the platform of choice for all of their kind of core business needs. And so we very deliberately force rank those. So we prioritized which are the biggest needs, and we kind of worked our way down from there.

So one big lesson we learned was, you know, in the early days, you’re kind of faking it till you make it, and you don’t really realize that scale might happen. And so some of our so our financial product line was a great example was, you know, we had built that very quickly, got it to market, arguably wasn’t a 100% enterprise grade. So we had actually had to stop developing that product at a certain point and go back and re architect it so it was enterprise grade.

And we literally stopped new future development for a year. But we realized that if we weren’t going to get this thing to the point where it was enterprise grade, we weren’t going to be able to scale it. What year was that realization? 2019. Wow. Yeah. We had to tell our customers like, look. Though all we’ve been we’ve been talking to about a lot of features that we’re going be building, we’re gonna actually pause on this for now. And, you know, you’re trust us. You’re gonna you’re gonna love it.

You know what’s so cool is that till this day, customers still come up to me and they’re like, though that was really hard for us to hear, it was the smartest thing you guys ever did on that product line because now it has completely changed the way we do business, and it’s completely scalable, and it’s enterprise grade. So yeah. But that was that was a hard decision to make.

Well, so our project management tool, which is our flagship, was definitely enterprise grade. Okay. This was a newer product we had just brought into market, and it was kind of becoming wildly successful, and to the point where we really had to go back and shore it up to make sure that we could actually deliver on our promises.

Yeah. One thing that we did learn was so what we were selling in the Australia New Zealand market, they had these these new laws in place in Australia around if a job site accident led to a death at a construction site, and a safety violation had been, seen prior to that that wasn’t documented, the CEO of the construction company would go to prison for manslaughter. All of a sudden, when we were talking to our our customers in Australia and New Zealand, they’re like, look, love your project management tool.

We need quality and safety because I don’t want to go to prison. Right? So we’re like, okay. So we started building this product for them, and we got really good product market fit. And then what we realized is that we took it, you know, globally to our global customers. Everybody valued that new product. And so we were able to kind of hyperscale that product because one market demanded it, but the rest of the market needed it. So we learned that we had the opportunity to kind of capitalize on those finite needs and then take them globally, and it worked.

I like to tell people this, which is it’s just a reminder. At every day in Procore’s history, I had never been the CEO of a company of that scale before. Right? So, like, because it was growing. Right? And so everything was I had to learn a lot as we went. So there were a lot of lessons learned. You know, going internationally, it’s really tempting to say what worked in The US market is gonna work in another market. I would say some of the biggest lessons learned was you have to build a brand and you have to build loyal customers and referenceable customers in those markets before you really can expect any sort of scale and growth in those markets.

Does that mean you should

So what I suggest you do is that you actually deploy your customer success and your field and product marketing folks there first, build that brand, get the groundswell going with the referenceable customers, then put your go to market team in afterwards to capitalize on that. In all kind of candor, we went all in into our early markets thinking like they’re going to love us, It’s all gonna go well. We have learned that there is a playbook here and that you have to really build that brand first.

But what we find is the longer that we’ve been into any particular market, the more success we have. So the way you enter markets matter, and you have to be patient. Nothing’s gonna happen overnight. It took us years to build the brand in The US, and so we have to be patient building brands in new market. One

No. So our mission is to connect everyone in construction on a global platform. I knew from day one that if we went with a seat based licensing model, which, by the way, remember, I’d run a technology company before this. So, like, that was the only really prevalent model at the time was seat based. I knew that what would happen was our customers were going to make value decisions based upon who was going get a seat. But the way that construction done is it’s a team sport.

And so you need everyone to have access to the system, because everyone needs to contribute. So I realized that I couldn’t go with a per seat model because that was gonna make it so we were never gonna be successful. And so I had to come up with another yardstick, and honestly, the only thing I could come up with was construction volume. One of our customers one day said to me, Harry, I said, how do you buy other things? And he said, well, I buy our insurance based off of our construction volume.

So if I’m gonna do $10,000,000 worth of construction volume next year, I will buy $10,000,000 worth of insurance. And so I thought to myself, well, here’s a way that they’re used to buying, and it’s actually a yardstick that actually scales nicely with customer size. So let’s adopt this. It was so wildly unpopular with our customers. Even till this day, some of our customers don’t love it, but it is the ultimate yardstick, and we really believe in it.

Yeah. So we did. And, you know, as one customer would adopt it, they would actually realize that it gives them the flexibility to buy more or less of Procore at any given time, yet they’re able to get all of their team members and their collaborators. You know, in construction, if we sell the, you know, Harry construction, right, you’re gonna invite all your subcontractors onto the platform. Those folks are working on the platform for free. They get all the benefits of Procore, but you’re paying the bill unless they wanna become their own customer.

So these folks would go and tell other general contractors, hey, I’m using this amazing product. So ultimately, our success kind of was the driver of adoption of this new pricing model. But like I said, even to this day, I was on a call last week with a customer who still wishes that we had a different pricing model.

So I actually have a very strict line at Procore. I do not do deal negotiations anymore, and I haven’t for the last five or six years. I build relationships with the customers that I want that I do not wanna be transactional. I make it very clear with all of our prospects and all the people that I’m talking to or customers at renewal that I’m not gonna be doing the commercial terms. But what I am gonna do is I’m gonna be a long term partner of theirs to put together a joint strategy of success.

And so I I create a very big delineation. I talk to a customer, I think, every single day. I think there’s nothing more important that a CEO can do than to talk to a customer. And I actually get kind of blamed for it sometimes. Like, people are like, are you spending too much time? And I just don’t believe you can spend too much time with the people that you’re serving.

So I I had the privilege of mentoring some CEOs of tech companies that are growing their businesses. And one of the things that I impart on them, which I wish somebody had imparted on me, was in the early days of a tech company, you do everything. Your job is to do. Like literally, yeah, I was writing code, I was taking out the trash, I was I was doing everything. At a certain point in your leadership scale, you have to learn how to stop doing and start leading.

And it’s a really unnatural motion for people that are just used to getting the job done themselves. And I see it till this day, Harry, with leaders of Procore, not senior leaders, but people that are moved into management roles and the difficulty that people have of letting go of doing the actual work and empowering their people. And I think that that’s probably one of the biggest challenges with anybody.

You have to let them fail. Now, you wanna you wanna minimize the blast radius. Right? You can’t let them fail with an existential threat, but you you have to let them fail. I look at this very much like I look at parenting. Right? A lot of parents’ big mistakes are they watch their kid start to stumble and fall and they try to catch him and save him from it. Right?

My parenting style was always like, if Henry was gonna stumble and fall, look, I I didn’t want him to hurt himself, but if he skinned his knee for instance, and kids get like freaked out and he would look up at me, I would be like, you know, hey, that was a quite a tumble you just did as opposed to being like most parents which are like, oh my goodness, like, that is the scariest thing I’ve ever seen. Let me help fix you. Because you want people to learn from their mistakes and you want to teach them without doing their job for them how to overcome those obstacles.

So it takes a lot of, like, trust in order to do that, but you have to do that.

No. It’s actually I did for a long time. I realized that my kind of superpowers are not in the operational activities of the low level detail. One of my mottos has always been, know your strengths and know your weaknesses and hire to your weaknesses. So I know what I’m not good at, so I hire these amazing people to supplement my challenging areas and my where I’m just not empowered and I’m not passionate? I’m glad they’re giving it away.

So I’m in the camp of you really cannot overcome your weaknesses to a level that is gonna be satisfactory for the business. At the scale that Procore is at today, I can’t be a mediocre finance mediocre HR guy, and I can’t be a mediocre salesperson because that’s not gonna help the business. Right? So I know where my strengths are, and I know my strengths are. I set the vision for the company. We help build the the annual plan. I provide resources to our teams. I spend all this time with our customers knowing what their their needs are.

And that’s the stuff that gives me energy and fuels me. But when it comes to, like, the low level operations of the business, I’m just not great at it. So I surround myself with great finance people and great HR people, great legal people, to doing all the work that I just am not great at and I don’t intend to be great at.

You know, this is one of the areas, Harry, where I’m act absolutely most fascinated. I always find it’s interesting that the way people approach me is seems to be they’re curious about, like, kind of, like, what my day to day job is like. So that at the Instagram side of things, like, you must have it so easy. Like, you’re a 9,000,000 billion dollar company, and things are seem to be going up into the right. They don’t really understand the complexity of the job, and they actually think it’s they think it’s easier than it is.

In reality, the job, it’s a twenty four hour a day job. I’ve been doing it I I’m, like, at 8,900 of Procore. Right? Never having a day or a moment off, and and it’s a hard job.

gets

different. It gets different. Right?

Trust me, having security and stability is priceless. All I’m saying is the baseline level of of stress involved has not diminished at all. As a matter of fact, you know, we have 4,000 employees globally, and we have 16,000 plus customers. Like, there’s the blast radius of screw ups is so big that, like, you can’t take that lightly.

You have to be intentional about culture.

Actually, I know a few CEOs who really think people are a commodity. I wouldn’t say most that all do, but I do think it’s important. And so what we have done is very intentionally, we hire to our values. So if you go through the interview process at Procore, you may think you’re being interviewed for your skill set, but to get into the interview process, you’ve already had to demonstrate that you have the skill set to do the job. The real hurdle they get over is, do you live our values?

And do you value our values?

So the value hiring is one piece of it. The way we solve for that is hungry, humble, smart. We will not hire somebody who doesn’t demonstrate that they’re hungry and that they’re humble and they’re smart. And trust me, I’ve hired a lot of hungry and smart people in this world. They tend to be assholes and they tend to not be good team players, and they tend to tank culture. And you know what’s interesting about culture is once you get a solid culture that’s based off of your values and you hire correctly, no longer as a CEO are you responsible to be the keeper of culture.

The business itself keeps culture. I always say it’s like angular momentum which is once the culture is set, if somebody sneaks into through it through the filters and gets in that this isn’t a cultural fit, the teams eject them. You just can’t survive at Procore if you are not hungry, humble, and smart, and if you don’t live our value. It’s just that simple.

Yeah. I’ve hired people again because they were luminaries in our industry, and I said to myself, look, they may not be humble, but they’re gonna move the needle. I’ve regretted every single one of those decisions that I’ve made, and fortunately, I’m not making those decisions any longer. But, yeah, those were hard lessons learned because some point, you know, you you really have to get real and say no to people that might have a big impact on the business, but you just know are not gonna be a cultural fit.

And in our scale, Harry, there’s no longer a superhero at Procore who’s gonna move the needle. Right? The only way you move the needle at Procore is you work collaboratively across teams in ways that are inclusive and basically brings the highest level of capabilities out of people in order to deliver big results. And you can’t do that if you are kind of selfish and you’re an individual contributor who all you wanna do is root for your own success. It just doesn’t work.

We have definitely learned which large tech companies to not hire from because because, you know, honestly, you can just go right back to the culture that is existing in those tech companies, and you’re like, you’re basically hiring in that culture, and if it’s toxic

You know, the inverse, which is really interesting, is at Procore, people will come to us and say, I want be a senior director. I’m a director. I want to be a senior director. You know, what do I need to do? Our message to them has always been, do the job as a senior director in the director role, and you will naturally get promoted into being a senior director. It’s not something that’s, like, granted to you. You don’t get this because you ask for it. You get it because you actually do the work and earn it.

It’s not that. But you know what? If you empower your boss by actually helping them do their job effectively, and it’s not just about checking the box and doing your nine to five job, you are much more apt to be promoted than if you just checked the box.

Yeah. By the way, we have a saying at Procore is don’t be a problem spotter, be a problem solver. You’ve come to me with a problem and not a solution, and I’m gonna march you right out of my office. Like, I don’t wanna hear about the problems until you have the solution at hand. So

It’s such a broad subject because, you know, for twenty one years, I’ve had to make very difficult personnel decisions. One of my very old mentor of mine, Tobi Luttke, as I’m sure you know from Shopify.

That might be the best thing I’ve heard in a long time. But he said to me this was probably ten years ago. He said to me, to me, what’s important about leadership is if your business is scaling at a 100% a year, that means you and your team needs to be scaling their skill set at greater than a 100% a year. I I took that to heart, is I look very critically across my leadership team to make sure that my team has what it takes to take us to the next level, not rewarding them for getting us to where we came from.

So I spend a lot of time having those conversations with folks saying that, like, look, there’s probably somebody outside of this organization that might be able to do this job where you can learn from them and scale your own career. It’s never easy.

You just make the tough choice. You make the tough call. Now, fortunately, the way business works is that you don’t wake up one day and realize that somebody’s not scaling. Right? You get all of the tails going up to it. You know, if there’s a leader underneath me who’s starting to kind of not scale to where we need them to go, you work with them on scaling. But at a certain point, you start having conversations around, like, let’s find a place in the organization where you can actually be successful.

And then if that doesn’t work, then you with all empathy in the world, you walk them out the door and you help them find another job somewhere else, and that’s the path that it can go.

So remember, I’m the college dropout who’s a carpenter. Right? I was never supposed to be a publicly traded CEO of a successful tech company. Right? That was not in the cards. So as we’ve grown Procore, we started hitting scale, like, around two thousand seventeen and eighteen, and things started really flying along. I started being asked to go to these investor conferences in the Bay Area, and, you know, it was like the time like Jeff Lawson was there, it was like this there was a certain graduating class that was starting to go show up because they had a line of sight to an IPO.

And I would sit there on these panels and every single one of the people on the panel would have their Patagonia zip up vest and they’d all gone to Stanford and they all were on the central casting. And here I am like a college dropout carpenter sitting on this panel going like, what the hell do I know? That was kind of an existential crisis personally for me. I wasn’t Frank Slootman and I wasn’t these other leaders that I looked up to just in terms of pedigree.

What did you tell yourself then? Because that’s that’s Well, so it’s interesting. I’m gonna bring this back to my wife, but I was miserable for probably two years. I tried. I even went out and bought the Patagonia vest and, you know, whatever. I just like I’m like, I I desperately want to figure this out. My wife said to me one day, she said, too, you know, on a personal basis, you’re miserable. And I’m like, look. I don’t know who I am and who I’m supposed to be.

And she’s like, that’s not true. She goes, you know exactly who you are, and you know exactly who you should be. Stop trying to be somebody else. And so it was such an a liberating feeling because I’m like, you know what? I’m my best when I’m authentic and I’m vulnerable. Right? So, you know, I grew out my hair a little bit longer. I you know, whatever. And I just started being me. And with all of my warts and all of the challenges of who I am, I just decided if I couldn’t be my authentic self, I wasn’t gonna be happy and honestly if they didn’t like me for being my authentic self and being vulnerable, they could fire me.

Right? But I was willing to kind of throw my badge down on that because I really wanted to be myself. The interesting thing Harry is people responded wildly supportive, like people loved seeing me be authentic and not be the try to be something I’m not. So it actually it wasn’t as scary as I thought it was gonna be.

No. I’m kind of going through a phase in my life right now where I’m really doing a lot of introspection on what’s it all mean and, you know, who am I and all of that. So I don’t think you ever truly know, but I think what you do know, again, is you know your strengths and your weaknesses, and you know kind of at the core who you are as a person. And if you just stay true to those the things, I think you can deliver your authentic self every day and it’s fine.

Well, it’s funny. I do this all the time, Harry, which is on my most challenging days, when things are kind of stacking up and no good news is landing on my desk.

More to you, like, oh, here comes Horsa. I call a customer. I honestly do. Like, and and there’s nothing that gets me more excited and grounded in the love of what I do than when I talk to a customer. So I literally do. I’ll be like, I’m I’m gonna stop everything today and I’m gonna call a customer, and it absolutely changes my attitude.

trouble with my wife, Harry. Thank you very much.

Yes. I I’m a huge believer. I don’t if you’ve read the book, The Outsiders, but to me, that was an absolutely cathartic experience for me to actually understand that that is truly what you know, one of the top four things a CEO has to do is be an efficient capital allocator. But really being judicious about how you allocate capital, it’s not easy, but it’s I’m the responsible party here, so I have to get it right.

Well, it kinda gets to the regret thing, and I tend not to spend a lot of time thinking about regrets, but I would say Do you know what that you learned from the things that didn’t go well? Yeah. But that’s why I don’t really consider them regrets. Right? Like, they’re to me, they’re an opportunity to learn. So we haven’t made mistakes at the kind of esoteric kind of the the big level where all of a sudden it’s we really, really screwed up. I’ve always been a firm believer, again this is actually my wife which my wife always says the indecision is the decision, but I believe in the the speed and the quality of decisions matters.

So I’m much more willing to make a decision as long as the blast radius is small enough that I can live with it not working. And so you can make lots of little decisions along the way and learn as you go without having to make these big decisions that actually, you know, can tank the business.

sure she’s available. Can see if she’s available.

I don’t really think about it that much, frankly. There’s a a lot of young people will come to me and say, I wanna be an entrepreneur. And I’m like, that’s not a thing. You don’t become an entrepreneur. Like, you follow a passion and you deliver, you build a business and you whatever, you know, so there’s this kind of a of a mismatch between some people are like, I wanna be like you because I wanna be successful. And I’m like, that’s not what I am. What I am is I’m somebody who’s following a passion, I’m delivering on the thing that makes me happiest in life, it’s not about making money.

So I actually don’t spend a ton of time thinking about money frankly and that’s probably a privilege I have.

I had a very recent experience with a group of leaders at Procore who all got together, and it was a cocktail reception. And I was walking around and having conversations with people, and I felt like the entire time, like, people were, like, felt like they were on a job interview with me. Right? It was, like, you know, talking about what they’ve been working on and, like, you know, while their work is more important than other work or whatever. And I walked out, and I actually called my wife on the way out.

And I’m like, I honestly value so much just direct real feedback. Remember, I’m a carpenter by trade, like, I’m I’m not some high flute and CEO, like, I value the truth and I value kind of the input and you get less and less of that as you get more and more successful. And so I keep a handful of people around. There’s three people that I call my cabinet, right? One is my wife, Hilary. One is Suzanne, who I think you might have talked to. And the other one is Paul, my ex CFO.

And those three people will call me an idiot all the time, and they’ll remind me that my, you know, craziest ideas are crazy ideas, and they basically keep me completely grounded. Because otherwise, if you live in a world where everyone tells you that every idea that you have is genius, right? Eventually your craziest ideas get acted upon and they’re not genius, right? So like I love having this governor on me which is this council of people who remind me how human I am, and it really helps me a lot.

Of course.

It was something I really worried about when Henry well, I have one son. He’s 25 now. When Henry was young, but Hilary and I looked at this a little bit different. So we have friends that, though they will fly around on a private jet, they want to drive a minivan because they want to show their kids that they’re not that or something. I we never played those games. We always believed that we would try to make Henry be the most empowered and responsible person we possibly could from day one.

We talked to him like he was an adult from day one and so we we basically just said, look, know, here are the guardrails, do whatever you can within those guardrails, if you go outside those guardrails, all hell is going to break loose and it did on several occasions, but within that you have the latitude to do what you want as long as you’re doing the right thing and you’re not being an irresponsible person, right? And we are so fortunate that today, Henry is one of the most well adjusted.

He’s probably the most frugal member of our family and he, you know, runs a very successful business at age 25 and I couldn’t be more proud of him. Here’s a great story. Henry, at one point, he came home from his friend’s house. He was like probably six and he was being he was kinda acting like his friend and like kinda being spoiled or whatever. So Hilary said to him like, look, either you stop acting like your friend and you become Henry or you can leave my house.

So he’s like, no, I’m not gonna do it. So she got him all dressed up. She packed a suitcase. She put it pushed him outside the front gate of the house and shut the door behind him. And he learned his lesson very, quickly and then, you know, obviously let him back in at a certain point. But just being categorical in how you instill doing right and wrong and not having any leeway in how you how you apply it just it worked.

Yep.

I would say my biggest regret, Harry, in life is that I didn’t do more. I wasn’t there more. There are big swaths of his life where I was completely consumed by Procore. Fortunately for me, we have an amazing relationship, and he’s he and I are, best friends. And Do you think that’s just what you have

Yeah. Well, like, here’s a great example. He and I were in San Diego yesterday visiting my mom, his grandmother. We dropped him off on the way coming up north in LA, and he goes, hey, dad. Do you wanna stop with me and go see the charter game tonight? Football game. And I I said, I would desperately love to do it, but I’ve got earnings this week, and I can’t do it. And just because I’ve got so much going on. And those are the tough like, even at this age where he and I are, like, best friends, I still have to make those really difficult decisions, and it breaks my heart.

But, like, it’s just what you have to do, I I think. I don’t there’s not enough time in the day to be able to do both amazingly well.

Yeah. I’m

That’s a good point. By the way, these are the things I struggle with. Yeah. I I’m sure I could have. I do try to prioritize my kind of self stability and and wellness first because if I’m not, I can’t show up well. So that that was part of my thing was I needed to get home, get a good night’s rest. We had a huge week this week, and I didn’t wanna start behind the eight ball. But yes.

If I’m really overwhelmed fortunately for me, Hilary understands I’m an introvert. So for me, the very first thing I need to do is I need to get some alone time. Right? So she will create lots of space for me to do my thing. One of the things that I do which I’m very I love is I will build extremely complicated LEGO sets. So and people ask me like like that’s weird. Why do you do that? Well, first, I’m a builder. I like to build.

And secondly, the thing with these complicated LEGO sets is if you get one piece wrong and then you go 400 steps past it, you have to reverse all the way back to that step, get it right, and then go forward again. And I always think of it as like business, which is like every step matters and so you have to be very intentional, you have to be very focused. And that focus on that particular act of building these complex LEGO sets allows me to stop thinking about Procore for a finite period of time and allows me to kind of clear my brain.

And it’s something that just works for me. I people will ask me, they’ll judge my stress level if I’m building a LEGO set or not. Right now, I’m not building a LEGO set, just answer the next prob probable question. But that’s how I deal

You know, Hilary and I have been together. We dated before we got married, obviously. But we’ve been together for, like, thirty five, thirty six years, something like that. We’ve been married for twenty five years. We know each other really, really well. And we complement each other really well. She’s a yoga instructor. Right? And I’m a CEO of a public traded company. And we have very vastly different worlds outside of each other. And so we basically allow each other to have that space. Do you like that she’s not in your world?

I love it. You would be surprised to know that I think Hilary has probably attended less than 10 Procore events in twenty one years. She desperately tries to keep a firewall between our family and Procore. And that’s her contribution to it is when I get home, we don’t talk about Procore. We talk about the family. We talk about our relationship. We talk about our mutual interest.

She forces me to. I’ve got a very, very strong willed wife. I don’t have a lot of choice, but it works. You know? I would not be able to survive if I didn’t have her. I wouldn’t be a good CEO of Procore if I wasn’t able to have, you know, her supporting me through this process, which essentially means giving me time and giving my space that I need to regroup and ref and get kind of performant again. So let me tell you this because it’s like business.

When I set out on starting Procore, I kinda had this vision of like someday we’re gonna be done and everything’s gonna be a state of nirvana. Right? Founders like to tell themselves that. When you get married on your early days, you’re like, Hey, someday this is gonna be perfect, right? Well neither one of those stories is ever true, right? It’s always a struggle and it’s always a slog but it’s hopefully always a net positive that you actually benefit from. And fortunately for me, with my business and my wife, I’ve been extremely successful.

Yeah. And you know, you asked me before, does it get any easier with Procore? It’s the same things with marriage, It doesn’t get any easier, things become different, but you know, you still deal with challenges, everybody does and that’s just that’s life, you know, that’s one of the things I think a lot about these days is that I think there’s an like perception that life should be stable and safe and predictable. People want that, right? But life is anything but that. Life is actually the complete opposite of that and the more resilient you are and the more agile you are dealing with adversity, ultimately the happier you are.

So I think we have to dispel with the myth that we are all deserving of stability and safety and happiness in our lives because that’s just not a natural state.

know to be true? First and foremost, that if you do what you believe in and you’re lucky, you could be successful. And I do believe that wholeheartedly, and I don’t think a lot of people fully understand that, that you literally anybody can be successful if they follow their passion and they have the amount of luck that’s required in order for you to get there, you can be successful.

Well, I would give skill probably the lowest ranking. I would give persistence the highest percentage score. I would say that’s a skill. Okay. Well, you can you can call that a skill then yes. Would say it’s skills, yes. I guess you did the luck side is I consider myself to be very lucky. I think about moments in my life that had to have happened, literally like single moments in my life that had to have happened that got me to where we are today. And it scares the life out of me when I think about, like, if I had just done one thing differently at that point, like, none of this would be true.

What’s the most memorable? Starting Procore was one. What I had decided was I was gonna wind down my other business and I was gonna wind up Procore. And that was not a rational decision. You know, I was making a lot of money and I was very successful and and stable in my last business, so that was not one. I had a a moment when I was transitioning from construction into technology where literally a family friend knocked on my front door. I had just quit my construction job.

I didn’t know what I was gonna do, and he offered me a job in technology, and I said yes. I knew nothing about technology, but he wanted to work with me, and he wanted to mentor me. If I had not said yes that day standing in my front door in my house in Sausalito, California, I wouldn’t be here today.

Generally, it was resource allocation. And he was right, and I was wrong. Remember, I’m the kind of maverick product customer centric one. I wanted to build, build, build, deliver, deliver, deliver, spend, spend, spend. Here’s a great example. In the very early days, went to a trade show and we had no money and we barely could afford to be there. And I think we were all sleeping in one hotel room in Las Vegas together like on the floor. And we went to the floor of the trade show that day and there was a booth where they were making branded hats.

So I went over and I bought 10 Procore hats and I bought it back to the booth and it cost a $100. Steve lit me up like I had just like tanked the business. He’s like, we don’t have a $100. Like, what are you spending a $100 on Procore branded hats to give away at our booth for? And we literally had like this, like, huge kind of knockdown drag out over the $100. So, yeah, that was that was a tough conversation. And by the way, I still have one of those hats.

We wouldn’t be here without the grandpa on the lawn. He kept us afloat. So

I would think it would be Microsoft because I have the fortunate privilege of having Satya be a mentor of mine, and I am absolutely fascinated by the complexity of that business and how he makes sense out of it all. Like, I always think Procore is complicated. We have, you know, 11 products and we’re, you know, whatever, 10 different countries and 16,000 customers. I don’t know how you get your head around a $3,000,000,000,000 business, and it’s just to me, it’s fascinating. So I guess if they would give me the reins for the the day, I think I would choose Microsoft.

Keep it into a healthy perspective. I definitely think about our competition, but not very often. I think about our customers always. And we used to have a NASCAR in Procore which was a race car in The US and we sponsored it. And one of our drivers once said, you know, the way I think about competition is you can either stare at them in the rearview mirror and lose the race or you can stare forward at the finish line and win the race. And so I’ve always kind of taken that to heart, is like listen to your customers, do what’s right, and you’ll win.

And you can just bet on the fact that your competition is not gonna be doing it as well as you. So I don’t really spend a lot of time thinking about them.

My dad’s father, my grandfather, is no longer with us. I would give anything to have a meal with him now that I’ve it’s a funny I’m getting a little choked up, but now that I’ve gotten to the point where I am in my career, he had taken his company public back in the seventies and he ran a very large bank and he was the CEO of it. I watched him and he was a role model of mine and he always carried himself with such dignity and poise but also authenticity like he treated the person who opened the door for him the same way that he treated his board members.

So I would love to sit down with him and just kind of compare notes Like, how would you grade me on my performance, and what can I learn still from you would be the biggest privilege in the world?

Well, the good news is my father is still around doing very, very well, and he Is surprised. Yeah. He’s be surprised. Like, literally, I was the kid in the family they’d written off. Like, I you know, and in my family, once you graduated from college, which I did not do, you got a free trip to Europe with the family to celebrate your future success. You got you get all these privileges. Well, I didn’t do that. So like late literally had written me off. I was working as a construction worker making $15 an hour living in a tiny little apartment.

I was not the one that was supposed to be success in the family, so he’s still, I think, relatively surprised by what’s happened here.

This seems kind of trite, but I was sitting in the front row of a class in college before I dropped out and I was doodling on a piece of paper and the professor walked up to me and she said to me, said, hey, you want a piece of advice that will change your life forever? And I’m like, sure. She’s like, when you have five minutes like you do right now, do a five minute job, tackle something. And I swear Procore would not be where we are today if I didn’t think about that every moment of my life.

If there’s ever a moment of the idle time, I find a way to fill it with something productive and so therefore I am highly productive all the time. And I I honestly think it’s been one of the best pieces of advice anybody’s ever given me.

I never doubted that I would be okay. I never, in my wildest dreams, believed that I would be where I am today. I would have never even given myself that latitude, but I always felt like I was gonna be okay and I think that’s one of the reasons why we survived the hard times is I just always believed that worse came to worse, I could go pick up a hammer and I could go to work, and I could make an honest day’s wages, and I would be fine.

So, you know, I like construction, and I own a ranch. And so I bought myself a caterpillar bulldozer, And I spend the weekends building roads and bulldozing things, and I love it.

don’t a I don’t own a plane. By the way, I drive a five year old Toyota Tundra pickup truck that’s all beat up and has a bent frame. Like and then by the way, I don’t do that because I’m trying to prove anything to anybody. I just do it because it kinda falls back into that authentic self. Like, I’m a construction worker. Like, I I there’s just I don’t need all of that.

I may have just bought myself a decent watch for the very first time in my life. Actually, my son Henry, who’s kinda likes watches, he’s the one who turned me on to this. But it’s not a fancy fancy watch, but it’s more than the Apple Watch that I normally had worn.

I mean, her way her her motto is, you buy yourself something, I’m gonna buy myself something. So that’s the way it So we’re very open and transparent.

So I’m still only 56 years old. Let’s assume they haven’t put me out the pasture yet here at Procore, but I would say at that point, you know, I am probably getting ready to think about retirement. Look. I’ve got this ranch that I love. I’m always building things. I just built a barn. I just built a deck. I just built a some outbuildings. I’m building a western town up there with, like, a saloon and a jail and a bakery and all this other stuff. So I’m gonna have my tool bags on.

I’m gonna be at my ranch and I’m gonna be building something.

No. And thank you very much. By the way, I feel like I’ve been having dinner with a great friend, you know, for the last hour and sharing a bottle of wine. So I appreciate it, and thank you for putting up with me as well.