Hi everyone. I'm excited to be joined here today by Marty, Robert, and Advith, the co-founders of Pylon. Pylon went through YC in the Winter '23 batch and is one of our fastest-growing companies over the last few years. I think what's especially exciting about their story is they took a while to find the idea and pivoted through several ideas. So we're going to chat about that today. Guys, thanks so much for joining us.
Thanks, Harj. Why don't we kick this off by just telling us what does Pylon do? What's the problem it solves?
Yeah, so Pylon is an AI customer support platform specifically built for B2B companies. We replace products like Zendesk, Intercom, Salesforce Service Cloud, but very AI-native and built for a B2B persona.
Could you give us a share anything to give us a sense of the scale that Pylon operates at today?
Yeah, so I think we're 79 people as of this week. We're three years old, three years since we spoke to and met you, Harj.
Winter '23, and yeah, I mean back then it was just the three of us. We actually pivoted through many ideas as we'll talk about, but yeah, 79 people today, three years old, eight digits in ARR, and last year we grew 5.35x.
Over a thousand customers now.
Nice. Can you mention any of the biggest customers you have?
Yeah, folks like Honeycomb, Linear, Incident.io, Applied Intuition.
And how many rounds of funding have you raised?
So we're Series B now. We've raised $51 million total from, of course, YC, General Catalyst for a seed and for a Series A, and Bain Capital Ventures for B.
Cool. I want to come back to Pylon as it is today in a little bit, but I actually think what's really interesting about your story is it took you a while to arrive at this idea. So why don't we kind of actually go all the way back and maybe just tell us a little bit about each of you individually, sort of your background, why you got interested in doing startups, and then maybe we can talk a little bit about how you started thinking about startup ideas.
Yeah, Adam, if you want to start.
Yeah, I can start. So I think Robert and I went to Caltech, and I think in college at least was when I first started getting interested in startups. I was considering being like a math major, and then when I went to college I was like, 'Oh, I guess computer science is some applied version of math.' And then met Robert freshman year doing like a puzzle competition. We're both super into puzzles. And then we ended up running our school hackathon together for a couple years, which ended up being basically like running a company minus building the product. It's a lot of like organizing tons of people, raising money, just like holding an event essentially. So like building a team that does something minus building a product. And so through that, I guess, built the muscle of how to work together with Robert especially. And then...
I think the funny thing is we were work colleagues in college. We weren't really friends.
Yeah. Yeah. Nice. So we like had a great working relationship where we'd work on stuff like Robert would take the night shift of like midnight to 8 a.m. and then I would take like the rest of the day shift like answering emails and like doing all these like company logistics stuff. And then that summer of sophomore, Robert sophomore year, he did this program called KP Fellows, which is this like entrepreneurial like internship program, and he was at DoorDash that summer and I was interning in the Bay as well. But I just that program has a lot of ex or like people who become founders later and so got to see what was going on through that. And then the next summer I did it, which is when I met Marty. I was interning at Slack, Marty was at Airbnb. And I guess the TL;DR about why starting a company is just wanted to do it even in college, just didn't have a thing to do it about. And so, like a couple years after graduating, we were all at startups. And then I messaged Robert like right after the pandemic being like, I feel like I'm wasting my life. So, it was on my 23rd birthday. It was like an existential crisis of a sorts. Just felt like I wasn't really doing anything. I was getting bored. I messaged Robert after...
That was on your birthday.
Yeah. Yeah. We actually started our first meeting like on my birth like 6:00 a.m. on my birthday. Yeah.
One thing I'm actually curious about quickly is so you both, you remind us where were you doing the internships?
Yeah. So those are both great companies. Okay. So all three of you are at like fantastic companies. I was curious like why did you decide to start your own thing versus joining one of those companies?
I just felt like at every internship I was trying to work at a smaller and smaller company. I actually just felt like I was wasting my time for lack of a better word. Like my main, not to insult Slack because a lot of our product is today based off of Slack, but at that scale it was maybe a couple hundred people and like my core internship project was they were doing a rename from like calling stuff teams to calling stuff workspaces and most of my project was literally renaming. And I just thought it was a super waste of my time and I actually quit. I like asked to leave the internship early because I thought I was wasting my time.
Yeah. I think on my end at least. So in high school I actually wanted to be a musician to start. So I had like written an album, I was in a band. And then I saw The Social Network and I saw Pirates of Silicon Valley. So I actually feel like movies just opened up the idea, like some sort of visualization of like what starting a company could look like and the fact that anyone can kind of do it with a computer with no resources. So I was already like personally interested in programming. Had like watched some YouTube videos, got like JavaScript for Dummies from a garage sale at some point. And so, you know, was doing that and then watching those movies kind of made it like real that like, oh, this could be much more than just like a fun little hobby. Yeah. And one way we've actually all described it is I feel like at some point we just realized we couldn't not start a company. Like you're just like sitting doing whatever we were doing at other companies and it's like you just in your gut you already know the answer, which is you have to go try starting something and like nothing is going to make you happy outside of that. Like you have to just go try it even if it's a mistake.
How about you, Robert? How did you know you wanted to...
Yeah, I mean I grew up in the Bay Area so I've been surrounded by like tech startups my entire life. I always imagine engineering is just like a hammer, and while I love hammering nails, I'd rather build a house and think about the house overall. So that's always been my goal and I think like every internship I just kept going to startups or companies just to observe how people build companies and just like kind of gather up all the different ways people build a team. And that's why the DoorDash experience was really cool because I got to see like what a great company looks like at such an early stage. I really didn't start my journey full throttle until Advith did reach out to me that one night. I was like, sure, let's do it.
So yeah, just talk us through the story there. Like after you reached out to Robert, then talk us through what happened next and how the three of you came together.
Actually, while I was at that point when I reached out to Robert, I was living with Marty. So Marty and I were roommates after we graduated.
Uh, no, or we were during the pandemic. So we might have moved away for... Yeah. So Marty and I were roommates after we graduated for like a couple years and Marty had already I think taken the plunge before that and like had started trying to do his own thing separately. At that point I wasn't, I guess I wasn't ready to. I felt like Samsara, the company I was at, doing really well. I wanted to just like do it on the side for a bit and so messaged Robert and then we started basically every morning, or I guess it started at a weekly cadence, just like brainstorming. And then it very quickly turned into like user discovery where we tried to turn to like the first set of people that basically are good candidates for user discovery based on like this book The Mom Test, who I think like YC is super all about too. And that was school administrators for us because we spent a bunch of time running our school hackathon. So we reached out to a bunch of the admins at school just asking them what their problems were and we landed on one problem that's not really a problem, but we thought was a problem at the time for like the career center. The lady who runs the career center was someone we worked with a lot when we were in college and so yeah, it was basically can we build a tool like an alumni portal so that students who have already graduated can reconnect with alumni for like career advice and...
And we made all the mistakes going through pivot hell. Like we built it before really validating with anybody. We were trying to build something in edtech, which we know is like probably a bad space to start out in.
And you guys were working full-time jobs at this point. Yeah. I mean, a question I feel like we get a lot at YC is from people who want to start a company someday is how do you do that? What does that look like day-to-day? Like you're working a full-time job and you're trying to make progress on an idea just...
I think we were really fortunate because it was COVID, so that because everything was remote, we could actually take a lot of the side... Yeah.
And I think at that point at least I felt like I had gotten pretty good at my normal job if that makes sense. And so like could still be pretty effective without like putting in the same amount of time. And so we started with early morning calls. I remember at like 6 a.m. we would talk and then at night and then it was like on a weekly cadence to start and then it became daily and then we started filling in all of the empty slots within our days with essentially customer discovery calls.
Yeah. I remember my co-workers would make fun of us because we had a calendar event called grind time.
Oh yeah. And they'd be like, 'What is that?' And grind time is when you're working on ideas.
How about you, Marty? How were you exploring ideas?
So I think a little before you guys started messaging, working on stuff, and first off I want to call out like I feel like none of us were sitting still at any point. Like I... And so yeah, for me I was at Airbnb for maybe like a year and a half and I was just like kind of miserable. I was like looking around myself at everyone else and I was like, 'Okay, do I want to be an engineering manager? Do I want to be a VP one day?' Like who around me would I trade places with? And the answer was no one. I just wasn't interested at all in switching roles with anyone who was ahead of me career-wise. And at the same time, I was looking at founders who were just kind of like pivoting around and trying to build companies. And I still like thought that looked way more exciting. And I was like, damn, if I spend, you know, the next five years just working my way up at Airbnb, I already know I'm not going to enjoy that outcome. At the same time, I'm looking at founders, even if they're not that successful, and just saying like I'd switch places with them. So, you know, during Airbnb, I started doing like side projects with all sorts of people, many different sets of co-founders in many different projects, like everything from like a dentist app thing to like a 3D clothing manufacturing thing, like anything I can think of.
Were there any differences in like your approach to testing out startup ideas early on versus the two of you?
I'm guessing that we haven't talked about this explicitly. I think I can explain at least my philosophy, which was like find any problem and then try to see if you can solve it.
I think for me, well one, you kind of like look at your own problems and then like comb through that list. I feel like quickly you run out of things. I feel like I didn't have that many problems that weren't like fun-oriented back then. And then I started like just talking to people. And so for example, like this like 3D like clothing printing thing was one of my friends who I met in SF, he like had an idea related to that. So he came up with that. Then there was actually one of our ex-roommates' ex-girlfriends was in dental school and so like I started talking to her about like that dental thing. And then eventually at least for me I realized I was only going to make so much progress while working full-time. I wouldn't say I was like in a place where I was so comfortable that I could just like easily not work that much and it was still in person. I think during the pandemic like you could just be at home.
For me I just realized I'm miserable at work. I actually have enough money saved up to like take some risk and then I, this was really helpful for me, I just like made a like best outcome worst outcome doc where I was just like here's like the best thing that could happen if I leave Airbnb and try to start a company. And so, you know, wrote out, okay, it goes really well, like make a bunch of money, like I love the job and no, I don't look back. The worst case is like, okay, a couple years of opportunity cost being a software engineer. You know, I like maybe I struggle to find a job again. But like realistically, it didn't feel that bad. I felt like I would just get another software engineering job two years later. So, yeah, I think writing it out helped a lot to understand, yeah, what is like the worst case and then also then pairing that with knowing I was going to be unhappy for sure if I stayed.
Yeah, I guess our process was at least for finding ideas, it was kind of similar. It was like looking to the people closest that we felt like we could source problems from. I think we understood that we had no problems ourselves to like actually solve and so, and luckily we had been working for a few years so there was, I think we made a long list of stuff related to what I was working on at Samsara, what Robert was working on at Affinity, and tried to like explore those threads. They ended up not leading to what felt like the biggest possible opportunity, but...
I think the cool thing is like of all those ideas that we had looked through, they do end up becoming good companies in some respects because a lot of our customers today were also ideating on the same ideas and then they did get somewhere with them. So we, I think one of the conclusions that I've pulled from it is if you're very good and like diligent and can grind it out, you can probably get some idea somewhere to some successful point. So...
So then yeah, through each of the iteration process we learned something. Like the first idea we learned to not build something before we like have very clear validation and I think for each successive idea we just refined our process for like how to validate an idea. Yeah.
And then how did the three of you come together and decide to team up to find ideas?
Yeah, so I had left Airbnb, worked with one guy for a year on a health tech idea, that didn't work out, then spent six months working with another guy who was actually still at Airbnb, and then, you know, six months in, it's clear he's not going to leave Airbnb. So, it's like, okay, back to the drawing board. I personally learned during that experience that co-founders matter a lot. And to be honest, I just didn't care about the idea that much anymore, personally. And I was just looking through my network of like who are people who I would just want to work with. And I'd lived with Advith for three years before. I considered him one of my best friends. And I was like, okay, like we've never worked together, but this is someone I think it would be really fun to build a company with. And so I reached out to Advith.
And then what was going on for you guys at that time?
Yeah, Robert and I were working together and it basically felt like since we're at this stage pre-idea that it was actually counterproductive to have even more people trying to brainstorm together. And so it felt like not the right time and it felt more like, oh, once anyone has something that might actually be an idea, let's all pile on type thing. And so we were reluctant for sure at first.
No, no, no, no. It was even worse than that to start because they were vague about it. They were like, 'Oh yeah, sounds great.' And then like crickets for like the next two weeks and I'm like, 'Okay, so like when are we doing this?' And they're like, 'Oh, like what do you mean?' And being super vague and like not direct communicators about the whole thing, which I feel like has been a trend for us continuing. But at least for me I was like, okay, this is like at the top of my list, you know, working with Advith, and then I started getting to know Robert through our conversations. And they basically said no. I personally started just like continuing to work on ideas. There were some that I tried to bring to them. One actually that I feel like we spent way too much time in hindsight is the...
This was like when crypto, like the metaverse stuff was like really big. And so there was this like one investor in LA, and I was in LA at the time, who was like trying to, was like, 'If you guys go build a company where you like sell digital land of the metaverse, I will fund it.' And so I was like, we like explored that idea for a bit and we're like, okay, where could that go? So yeah, just stupid ideas in hindsight.
While we're on the topic, like what did you all learn would you say during this process about finding co-founders, especially at that earlier stage when you're trying to figure out the idea to even work on? Like what works and what doesn't?
We learned the same thing that he just said, which is like you shouldn't base your co-founders based on the idea. There were several iterations where we were like about to start this company in the logistics space. We actually feel like we validated the problem and we felt like what was missing was like sales experience in the logistics space or some entrenched network. And so we were considering co-founding with these like two other guys who were just like deep logistics like sales veterans and we just, we actually just could never land on an equity split that made sense. So we were actually quite close to...
I don't think we ever built trust enough. Just like they were just too different of people.
Yeah. And so I think we reached the same conclusion that you want to pick someone you want to work with and that you will have a good relationship with.
Especially if you pivot the company and the idea changes off of that industry, then those people don't make any sense anymore. So, you just want to work with people who long term you can actually work with.
Yeah, that's something I learned with the first co-founder I was working with. He was like very related to the idea in we were working on like a Parkinson's app and he was like very involved in that community. And so, that was the only idea that it made sense to work on him with. And so, like I think that also prevents you from pivoting later when you should, right? Because you kind of like start realizing it's not working or struggling and then like you're just like, no, we have to, you like kind of are focused on that. I actually think that's one of the reasons that passion is not like the best reason for starting a company too. Passion for like an idea or space because it might blind you to building a big business if that's what you actually want to accomplish.
Yeah. What do you, because so much of the common advice and the sort of original YC advice is around like, you know, solve your own problems, make something you want, like be the user. Over time it actually feels like so many more of the startups that are successful were solving someone else's problems. Like what do you think about that advice and how...
Yeah, I don't think it's important either because I think if you're intellectually curious, it's pretty easy to put yourself in the shoes of a user that you haven't been in the past. Maybe you like have some like built up unique insights if you happen to have, you know, lived that problem for a long time, but you can speedrun that by just like being super deep in the space. I feel like...
I also, I mean we aligned early on some of the key reasons or the key components of building a company. So first off, like the motivation for building it for us, a lot of people will say like, oh, money or yeah, passion about the space or like maybe there's some like ego thing. I think for us it was very clear it was motivated by fun and adventure. So it was just like exciting, right? It was just like that's the most fun thing that we could come up with doing. So the why was pretty aligned between all of us. The what, so we definitely wanted to build a big fast-growing company and it didn't really matter like what the company did. So I think that that's actually a superpower in some sense because then if you know you just want to build a big company, it doesn't matter what or like which industry, then you can just clearly like work backwards from that outcome. And then like the how was also really important for us of like we wanted to build kind of like the hey, live together, like grind it out really hard. And like even the people you guys were considering working with right in the logistics space were definitely going to be like, hey, like kind of live separately, which sounds normal for everyone else, but that's like not the vision that I think any of us had for starting a company together. Yeah.
One of the approaches I've had to sort of finding ideas is you start by at least defining like the attributes of the type of idea you would want to work on. Drew Houston used to give this talk at YC constantly about how he found the Dropbox idea by he didn't know what the idea was, but he knew he wanted to build something that he would use himself, that was a deeply technical problem, that monetized like from day one. Did you guys do anything like that when you were brainstorming? And just curious what your thoughts are on that.
Yeah, I think we iterated like a lot in terms of the like what type of idea. So I guess like one component is, okay, we want to build a really big company. We definitely were...
What does that mean though?
Yeah, exactly. Exactly. So defining it more explicitly these days we tell you like, okay, we work backwards from a billion dollars in revenue or a $10 billion company. And so we actually looked at public companies, public B2B SaaS companies at the time who are worth over $10 billion. And turns out there aren't that many. There were at the time 26 of them. And so when you look at that list you're like, oh shoot, that's like not a lot. How do we like understand why they got to that size? And so...
And what does that, how do you do that?
Yeah. So I mean this goes back to like when we came back with our ideas, right? So when we started working together, I had one idea I was working on, you guys had an idea, you were working on the logistics one, and this is actually I think such an important part of the story. The fact that we came together with different ideas and had to battle test them against each other was actually so helpful.
Because so you're all sort of like researching your own ideas and digging into markets and then convening together to like debate them.
Because then it was like they were excited about their idea, I was excited about my idea, and then it's like, okay, which one should we work on? And so then we literally, we spent like I think like probably half a day one day maybe working on like the fintech idea I had and we spent I think more time on the logistics idea. But then we literally made a Google sheet. I've looked back on this a couple times. It's really fun. We started with two tabs. Tab one was this fintech idea and we did a bottoms up analysis of, hey, like how big could this company be? And so the conclusion was like if we like crush it, it's going to be worth like, or we will make high tens of millions in revenue. Then we did the logistics one, if we crush it we're going to make like hundreds of millions in revenue, and that's by the way the whole market. And then finally, we had this impression that like B2B SaaS or like something that you could sell to any company was kind of an end state for a lot of people who were pivoting. They try like all sorts of like verticals and then just like eventually pivot to some sort of horizontal SaaS category. And so we took Rippling as like a model company and made like a third tab for them and we're like, okay, like how big can Rippling be and if we did the same exercise for them, how big is their market? And what we realized was actually their market is orders of magnitude bigger than like the things that we were looking at. Like you just take like everyone who gets paid and multiply them times a subscription. It's like, holy crap. That's like, it's clear why some companies can be so much bigger is you will inherently just be capped by the market you choose initially. And so then it was kind of like I think there was a little bit of sadness for, it's always sad when you like invest into an idea and you're like, oh, like you think it's going to work.
On that note, like you were at Airbnb. Airbnb is like the classic example of the seem tiny and...
Great, but the thing, the key thing here is like it is an established big category, right? Travel is a huge category and then so, and this is an important dimension, it's like okay, there's the big category that exists already and then there's some sort of emerging trend within it which ideally we could latch on to and then grow with in an existing market. And so like Airbnb is a great example of this. Like Bitcoin would be a great example of this where hey, you'd say crypto is small, but crypto is like, it's like the emerging way of doing things potentially in financial systems, money, like and that's a massive market, right? And so you kind of latch on to the emerging trend within the really big market and your bet is that that emerging trend is going to grow really fast. And so for us, like okay, we kind of looked at all these like bigger SaaS companies. The biggest company on the list was Salesforce at the time, like $300 billion market cap. And one thing that was really interesting, I can't say like it really played out exactly like this, but it's a nice story. Like it turns out Salesforce, like their biggest revenue driver was actually Salesforce Service Cloud, which is their customer support platform. So everyone knows them for their CRM, but actually their biggest revenue driver, I think as of the end of last year, $10 billion in revenue for Service Cloud, and that's where they make the most money.
And so yeah, kind of looking at those companies, like realizing we needed to be in something more horizontal, wanting to work on like kind of a big must-have pain point as well. That's like something we investigated a lot. And then yeah, so big market, emerging trend, and then yeah, do you guys want to talk about like how we explored from there?
Yeah, one more thing is like yeah, we were pretty focused on B2B because basically in B2B you can actually reason about why someone would buy your product. It feels like you're actually solving a specific pain point. And so like it's, you can like convince yourself more easily that the thing you're building is like actual like thing that people need. And then also if you're in a general large space, you can like not know the huge vision at the beginning and still expect to be a large company because you can kind of pivot or mini-pivot or gradient descent into like whatever the massive thing in the space is. And so as long as you have some beachhead in like a large space like B2B or like some functional technology in B2B, then you can end up with somewhere big. So you don't have to know the end state before you start.
Yeah. I think it's also important to dig into like the why now, and that was very important to us to try and figure out like why companies succeeded at any point in time. We like looking at all the anecdotes and all the different examples like Salesforce having cloud to beat out Siebel and that's why they ended up winning. For us the why now ended up being realizing that companies talked to each other over Slack, but like we didn't even realize there were other why now that helped us, help propel us. And I think like now nowadays with YC companies, AI is like the why now, but we didn't even know that would be a thing back when we were pivoting.
