In this lecture, we're joined by Stewart Butterfield, founder and CEO of Slack, and Adam D'Angelo, founder and CEO of Quora. Sam and Stewart will explore the process of getting an idea, followed by Adam on tracking metrics for your company.

We have Stuart, the founder and CEO of Slack, and then we have Adam, the founder and CEO of Quora.

to talk about ideas and how to find good ones.

And then Adam is going to talk about metrics, why they're important and what to measure.

Stuart, thank you for coming and spending some time with us.

Stuart is the founder of Flickr and Slack.

And what I didn't know until very recently is that he tried to be the founder twice of massively multiplayer online games.

And he turned into these 2 iconic companies.

So I wanted to talk about just the process of coming up with the idea for the game and then the ideas for Flickr and Slack.

All right, so yes, twice we set out trying to build a web-based massively multiplayer game.

And the origin of that was all the way back in 1992.

I arrived at college and I got my account on the school's Unix machine and was exposed to the Internet for the first time.

And it was kind of a mind-blowing experience.

So this is about a year before the web became popular.

And I was really fascinated with the idea that people could find their community irrespective of what that community was.

So if you were a breast cancer survivor or a model train enthusiast or whatever, if you're interested in some, as I was, obscure 19th century biologists, then you could find all that stuff.

And the idea of a game that lived online like that and had the Game-like aspects or play as a pretext for social interaction seemed really interesting and I'm not going to go into too long of an explanation because it turns out it's actually like a terrible, terrible idea.

And at least as a commercial business, like it might have been fun as a hobby.

I think it Could have been the kind of business that sustained the number of employees required to operate it, so like a restaurant or something like that.

we started the company that ended up making Slack, we raised $17.5 million in venture capital.

And it's just like never going to become the kind of business that would justify that investment.

But the first time was a little bit different.

It was after world common and Ron accounting scandals.

It was after 9-11 and the NASDAQ was down 80%.

No 1 wanted to invest in Internet facing stuff.

So it's very hard to tell whether this was a good idea or not.

Because there was no signal from the market that said, this is an investable idea, because nothing was investable at that time.

We raised a little bit of friends and family money.

We spent about a year or so building a prototype.

The prototype was well received, but it was going to take us another year and a half to finish it.

And we just, like, we literally couldn't raise any money at all.

We got to the point where the 1 person on the team who had kids was the only person who was getting paid.

And then we decided to try to find something else we could do that would make use of the technology that we'd already developed.

But that would be quicker to get to market.

And that thing was Flickr, but it was also a bad idea at first.

So because we had developed this game client and we had a messaging server on the back end, we just repurposed the game client as a photo sharing client.

So in the game, you had a bunch of slots along the bottom of the screen for inventory.

Those became slots into which you could fit photos.

And because the game was all real time interaction, the photo sharing was all real time interaction.

Which meant that you had to be online at the same time as someone you cared about in order to use it.

And while it demoed really well, it was amazing technology, especially for at the time we started on that, maybe like late

It was a terrible product because you didn't care about any of the people who were actually online.

That morphed really quickly and the experience making Slack was a little bit different.

We had all of the resources we could ever ask for.

I mean, we had more than enough money because we had money left over and we decided to abandon the idea.

And we had AWS, which we didn't have before.

So none of those external conditions was the reason this wasn't, this massively multiplayer game on the web wasn't a good idea.

It was just not a good idea because there wasn't a big enough market for it.

How did you decide that Slack was the thing to build?

Well, we started developing the system for internal communication that was based on IRC.

And those of you who have used IRC and also use Slack can recognize that Slack is IRC with all of the things that we're missing when it was originally designed in

I think this is, I don't know, it's post facto analysis, so it's hard to know if this is really true or not.

But I think that the reason that Slack has been so successful is because we had a 3 and a half year long design process where we weren't conscious that we were designing it.

Among them, you can't store and forward messages.

So if I wanted to send you a message and you're not connected to the server at the moment I want to send it, I just can't send you a message.

So the first thing we built was a bot to log all the messages and put them in an archive.

And once we had that, We had messages in a database and we thought search would be useful, so we built search for it.

there were no good IRC clients for iPhones.

And so we built an HTML5 front end for the archives in Safari.

And once we had that, we wanted to be able to post, and just like on and on and on.

But in the normal process of software development, there's a huge amount of ego and speculation.

So when you're arguing with someone about whether this feature is a good idea or not, it's, I mean, if you can get to the point of enlightenment in a Buddhist sense, then maybe you can do that without any ego.

But the practical reality is people are very ego-laden in those discussions.

I think this could be really valuable for someone.

Whereas when we were building the system that was kind of the proto-Slack, that was the inspiration for Slack.

It was whatever problem is the most irritating, like something that we just absolutely can't stand.

We would address that and then with a minimum amount of effort and then go back to what we were supposed to be doing.

And then kind of let it cook for several months.

And we had 45 people working on it, working on the game.

Or when there was a problem, I mean, an opportunity that was so obvious that we couldn't help but take advantage of it, we would spend the minimum number of minutes on that and go back to it.

So at the end of that process, we had this fully designed product that we were using that was a terrible implementation, not what you would do if you started from scratch.

But it was obvious that this was something that had enormous value.

Everyone who worked at the company agreed they would never work without something like this again.

And so just on that basis it seemed like it was a great idea.

Were there other things you considered pivoting to or was it just like there's this thing, we're going to do it.

I wish that I had better access to the proposals that I personally had written, because I had a whole bunch of fucking terrible, terrible ideas.

And this was the 1 that had the broadest consensus among the team as being something that would be valuable.

What's interesting at the time though, so we had $5 million left in the bank.

None of our investors wanted their money back.

They wanted us to just go try something else.

And Jason Horowitz is 1 of our investors.

So we went down and did the partner meeting and kind of presented what our big idea was.

And at that time, this is before we actually started development of Slack, but when we had this proto version, we said that 1 day this could be like a $100 million a year revenue business, so it could be valued at $1 billion on that basis, and we thought that that was like a decade out and that would be the culmination.

Like that would be, we have 100% of the TAM.

And we went past that in year 2, kind of blew past it.

We'll do 200 million in gap revenue this year and still be growing at a very fast rate.

And now we think that number is more like 10 billion in revenue, like a $100 billion company.

So we didn't realize how good of an idea it was.

But it's also, there's an interesting story about deciding to shut it down.

Because we still had money, Because we had a relatively big user base who were very engaged, but we had a really, like a leaky bucket.

It was very difficult to add new users to the game that we were working on, which is called Glitch.

I felt very stuck in this position because on the 1 hand you have a narrative of good entrepreneurs are resilient.

When everyone else thinks it's a bad idea, it's probably a really good idea.

You have to dig in, prove people wrong, keep going even when times are dark.

And the other hand, there's a morning when I woke up and I was just like, I can't do this anymore.

I'm the CEO, I'm the chairman of the board, I'm sure that this is not going to work.

And it's actually hard to convince everyone else.

I think that's 1 of the hardest things about evaluating ideas, is saying when this one's not going to work.

So do you remember what it was about that morning when you woke up and said, you know what, it's time to move on?

I don't, I mean, I think people have very little introspective access to their own cognitive processes to begin with, So anything I say would be kind of making it up.

But I think it was, I had exhausted all of the ideas we had to fix the problems.

And we really wanted to teach people what this was and kind of what the possibilities were and get them excited about it.

Because we were okay at attracting people onto the top of the funnel, but had a hard time retaining them.

I tell people to give up an idea, when you're out of ideas about

So we would have an idea, we'd try it, didn't work, have another idea.

And then at first you can fill up post-it notes, those giant boards, you can fill up whiteboards with ideas, and you argue about which ones are the highest value.

And then 1 by 1, you kind of eliminate them, months go by, a year goes by, another 6 months goes by, and it's like shit.

These are all of the ideas that we thought were the worst ones to begin with.

And we only have 3 left, so this is probably not going to work.

You mentioned at 1 point that you had a bunch of proposals.

Or how did you even think that Slack is maybe this thing that is a really good idea?

How do you come up with new ideas and how do you evaluate them?

I feel like it's hard almost to not come up with ideas.

I mean, they're not necessarily good ideas.

So the recognition of which ones are good is actually much harder.

I recently finally got around to reading Thinking Fast and Slow, and there's this story there of a psychologist named Herbert Simon who's studying chess grandmasters, Because chess grandmasters are 1 of a category of people, like really experienced doctors, who people regard as being kind of miraculous in their ability to intuit a situation.

Like glance at a board and say, white checkmate in 3 moves.

And people thought that this was like some super well developed intuition.

And Professor Simon argues that it's just recognition, in the same way that like a 18 month old can look at a dog and say doggie.

Or within the first 500 milliseconds of someone speaking, you can tell if they're angry at you.

Like you just develop the ability to recognize situations and cues which are hard to disambiguate, or they're hard to articulate and enumerate in your mind and say exactly why you think this way.

But over time, you get better and better at doing it.

And I've been making software professionally for about 20 years.

So the specific micro ideas or sub ideas about feature implementation or the order of actions in the user experience or whether a certain feature is more important than another feature.

Those ones I feel like I have an intuitive sense, which is actually just the ability to recognize over time.

Like you just have constant ideas, everyone has ideas.

We at Slack have developed a lot of organizational design and practices to try to absorb as many as we can.

So we get about somewhere between 10 and 20, 000 tweets at us a month.

And all of those are responded to by an actual human being.

We get a similar number of customer support tickets, and we have processes for trying to filter up and abstract all of the feedback that we're getting.

But even down to the level of all of the tweets at Slack, the company are pumped into our Slack instance.

And people check them and they can add an emoji reaction and that filters it to another channel for the ones that seem above some threshold of.

This seems like a good idea and it also seems practical.

Like I could imagine that we could do it.

And then there's some debate at that level.

But I mean, every, well, because almost every person I know in the technology industry also uses Slack, Every time I talk to any of them, they have ideas for me.

I mean, they have complaints or proposals.

So the big ideas, or the little ideas, I get the intuition on.

Did you spend a lot of time thinking, before you decided to go ahead with Slack, Did you spend a lot of time thinking about this would be really strategically valuable and there'd be a deep network effect?

I mean, so we thought that this would be valuable for individual teams and we could see that value demonstrated in our own experience.

We definitely didn't see how applicable it would be, because right now we have 38, 000 paid customers around the world.

I mean, we have a sales team, but we've never talked to 90 plus percent of our customers because we just couldn't talk to that many people.

So again, this is already farther than I thought we would get at the very end.

But those big ideas are, I don't know, we talked briefly about this topic before.

And 1 of my favorite lines is, I have a great idea for a novel.

All I need is for someone to write it for me.

Like no 1 would really think, I mean, only a very deluded person would think that that's true.

But people definitely have ideas for apps all the time.

And it's so rare that I hear 1 where someone proposes an idea where it's like prima facie that is a good idea as opposed to, I don't know.

I mean, it really depends on the execution.

Like actually just last night I was watching something on YouTube and the ad that came up before was for an app called Mile IQ.

And it's, you turn it on, ask for location permissions.

And then every time you go on a car ride, it just looks, you know, see by the speed that you're traveling.

And then at the point you stop, it stops it.

So kind of like an automatic Strava, like it just records all your trips.

And then you can swipe right to say that This is a trip that my company is supposed to reimburse me for and swipe left, not.

It's actually a really great idea because people have trouble recording those.

They have trouble in audits with the IRS to prove that they used the car for this purpose and stuff like that.

And that's 1 that actually seems like, the execution doesn't seem very difficult.

If you could market it effectively, it would probably be a successful business.

But the, like 95% of the ideas I hear, I have no idea whether it would be successful.

Where are you generally on the spectrum of ideas matter and it's worth the effort to think of a good 1.

And it's just all about execution and ideas don't matter at all.

You just have to keep trying things until someday 1 of your internal tools turns into slack.

So there's, I'm, there's a lot of people in this class, and then there's a lot of people at Stanford, and there's a lot of people in South Bay, and there's a lot of people in the Bay Area.

And many, many people want to start tech companies and all hope to be successful.

So to a certain extent, there is like 100 million monkeys banging on typewriters and someone's going to start a Shakespeare sonnet.

So there is a little bit of that, like a little bit of survivorship bias and other cognitive biases that come into play.

On the other hand, I don't think either end of the spectrum is right.

I would definitely lean more towards execution.

There's a good Steve Jobs elaboration of John Scully got hired and started hiring all these people at Apple who thought that only the ideas matter.

The idea Absolutely matters, but the idea when you start hitting execution has to accommodate so many things.

So in Steve Jobs' case, it's about what it's possible to get glass to do, and how small you can make batteries, and what kind of tensile strength plastics have, and stuff like that.

Because your idea has to stand up to all these things and it'll transmogrify and alter.

It may even be unrecognizable at the end, but if you're really good at execution, then the core of the idea can make it through all those steps.

So I absolutely favor absecution, but you can execute a lot on a terrible idea and then not get anywhere.

If you were starting a new company today, April 2017, where would you look for ideas?

What sorts of things would you be thinking about?

I don't know if this works for other people, but I would definitely look at my own experiences as a consumer generally.

Because it's really easy for me to see things that are frustrating.

I complain about stuff a lot, especially given how good my life is.

My life is really good, and yet every time I have to fly somewhere I have at least 10 significant complaints and 50 minor complaints.

And every 1 of those things that don't go as well as you would like are opportunities for improvement.

And some of those seem like someone else should see them, and it should be really obvious.

There's this story I tell in our internal onboarding process of me and our head of product design going for a walk in Vancouver.

And our office in Vancouver is in a neighborhood that has really narrow sidewalks, the sidewalks have sandwich boards and vendors out, so it's very crowded.

So you kind of wind around, and it starts raining while we're on this walk.

And people are, maybe two-thirds of the people had umbrellas with them, and we didn't, and people are walking towards us on the sidewalk and almost no 1 would move their umbrella out of the way so that the pokey things wouldn't get us in the eye and like I said the sidewalks are very narrow so we had to keep on ducking And I can come up with many explanations for why this would be, but don't explain with malice that which can be explained by ignorance.

So it probably wasn't just that these people have few avenues for exercising power in their lives and they were choosing this moment to exercise some power.

But then there's only really 2 explanations.

1 is that they just walk through the world and they don't see that we're going like this to get away from their umbrella, even though inevitably they've had that experience themselves.

Or they see that this is happening and they're like, I just can't think of anything I can do to ameliorate the situation.

Despite the fact that it's this, it's tiny, like a hundredth of a calorie worth of effort and a tiny amount of consideration.

And the point of telling that story is that that's the way, And this is a sad way of looking at the world, but that's the way that most people go through the world.

They're just, they're oblivious to the problems that other people have.

And if they notice the problems, they're unable to come up with any kind of solution.

So like, two-thirds of the people just didn't tilt their umbrellas.

Which means that if you're the kind of person who's willing to tilt your umbrella, there's a whole world of opportunity out there.

Do you have any tips on how to notice that you should tilt your umbrella?

But pay attention especially to other people.

So you can pay attention to your own signals and maybe if you get practiced.

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How to Get Ideas & Measure - Stewart Butterfield of Slack & Adam D'Angelo of Quora - Stanford CS183F