Retool CEO David Hsu On The Best Time To Start A Company
Although he was born in Silicon Valley, David Hsu started Retool abroad, after graduating with a philosophy degree from Oxford. His startup, which makes the building blocks for developers to create their own internal software tools, has grown to a valuation of $3.2 billion after signing on a slew of big name customers like Amazon, DoorDash and the NFL.
Hsu sat down with Forbes Reporter Rosemarie Miller to talk about some of the low moments while building Retool, how to learn from rejection and how to know when you shouldn't start a company.
Hsu sat down with Forbes Reporter Rosemarie Miller to talk about some of the low moments while building Retool, how to learn from rejection and how to know when you shouldn't start a company.
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00:00 (upbeat music)
00:02 - Hi everyone, I'm Rose Marie Miller
00:04 and we are backstage at the Forbes 30 Under 30 Summit.
00:08 And I have the pleasure of speaking with the CEO
00:10 and founder of Retool, David Su.
00:13 David, thank you so much for joining me.
00:15 - Excited to be here.
00:16 - Are there any other titles you'd like to add to that
00:18 before we keep going?
00:19 - Oh no, let's go.
00:20 - Let's go.
00:21 So David, what's your background
00:23 and also tell me the inspiration for Retool.
00:26 - Yeah, so Retool is sort of enterprise software company.
00:30 We started actually because we had a lot of problems
00:33 as developers ourselves, engineers ourselves,
00:35 building sort of internal software.
00:37 And so we're like, maybe there could be a faster way
00:39 of building all the software.
00:40 So that's how we first got started.
00:42 - So how is AI kind of affecting Retool?
00:45 - Yeah, it's actually sort of a really big tailwind for us
00:48 in the sense that I think a lot of people now are looking,
00:50 a lot of enterprises especially,
00:52 are looking to how can I sort of incorporate AI?
00:54 How do I build more apps that use AI, et cetera?
00:56 So it's a real tailwind for us, which is pretty exciting.
00:58 - I love how you're just like,
00:59 "And I'm just gonna like build Retool."
01:01 No, David, no, that's just not how things work.
01:03 - A lot of things went wrong along the way.
01:04 I have to talk about it.
01:05 - Tell me about some of those things that went wrong.
01:07 I'm sure someone would appreciate it.
01:10 - Yeah, well, let me think.
01:12 What's a stressful moment?
01:14 So we went through this accelerator called White Combinator
01:17 and White Combinator happens twice a year.
01:20 And at the end of every batch,
01:23 there's something called a demo day,
01:24 which is sort of where everyone goes and presents
01:26 sort of your idea and what you worked on
01:28 for the past few months.
01:30 And the idea that we initially worked on actually
01:33 was so bad, we didn't even wanna present it.
01:35 And so it was actually kind of embarrassing to some extent,
01:38 because all of our friends that we were in the batch with
01:40 were going up and presenting and raising money
01:42 and we felt so proud of them.
01:44 And we felt so ashamed of ourselves.
01:46 We were like, "Wow, we have nothing going on.
01:47 "We have nothing to present.
01:48 "We really wanna come back in three, four months."
01:50 So that I think was sort of a pretty low moment,
01:54 if you will, where we were really doubting like,
01:56 "Hey, are we starting the right company?
01:58 "Are we doing the right thing?"
02:00 - So how did you overcome that?
02:01 - It was hard, to be honest.
02:05 I think we were really lucky to have
02:07 sort of a bunch of advisors around us.
02:09 So for example, White Combinator,
02:11 sort of some of the group partners were very supportive.
02:13 And they were like, "Hey, look, a lot of startup ideas
02:15 "don't work out the first time, actually.
02:17 "We funded you guys not because we thought the idea was great.
02:19 "In fact, we thought the idea was bad,
02:21 "but we really believed in you."
02:23 And I think hearing someone sort of say
02:25 such supportive things, obviously, was very helpful
02:28 in getting through some of that.
02:29 - They really believed in you.
02:31 What was it about you that they believed in?
02:34 - Oh, you should ask them.
02:35 If I had to guess, it was probably something
02:38 along the lines of, I think, probably one of the most
02:41 useful skill sets of starting a company
02:43 is we will learn very quickly.
02:45 And so sort of approaching company building
02:47 and sort of a, "I have some ideas about the world,
02:49 "but look, I'm probably wrong."
02:51 Some percent of the time, we learn about
02:53 which areas are wrong.
02:54 And being sort of open-minded and sort of low ego,
02:56 I think, is a quality I hope to have.
02:59 - Did you feel lucky to know that, like,
03:01 "Wow, they believed in me,
03:02 "they didn't really believe in my company."
03:04 Because think of all the pitches people must hear
03:07 and all the no's they give out.
03:09 Did you feel lucky?
03:12 - Oh yeah, definitely.
03:13 I mean, I think, just to give you a sense,
03:15 like, when we were raising our seat round,
03:17 this was five, six years ago,
03:19 I think it was sort of like every story you hear, basically.
03:22 You end up getting something like 100 no's, basically,
03:24 and three yes's.
03:25 And of course, three yes's are what matter.
03:27 And you feel great about that.
03:28 But you do go through, like, 100 no's.
03:30 And so the three yes's, to some extent, are lucky.
03:32 But it's certainly, there's certainly a lot of luck,
03:35 and I'm fortunate to have benefited from some things.
03:38 - So when you hear those no's, do you think,
03:40 "Okay, we need to fix something after each no,"
03:45 or do you just think, "They weren't for us."
03:47 - It's mostly the latter,
03:49 but it's probably somewhere in the middle.
03:51 I think that if you wanna start a successful company,
03:54 you do have to be open-minded.
03:55 Like, you're probably gonna be wrong about things.
03:57 And so, you know, behind, let's say, 100 no's,
04:00 probably, like, 90 of them,
04:01 it's, you know, just not a good fit, for example.
04:04 But behind 10 of them,
04:05 there maybe is sort of some learnings you should take away.
04:08 Like, "Oh, maybe I, like, presented or pitched this
04:10 "in sort of the wrong angle or wrong way,
04:12 "and that triggered something in that other person,
04:14 "and so they said no for that reason,
04:15 "so I should try not to do that in the future."
04:17 So I certainly think no's are useful for learning,
04:20 but I don't think you should sort of over-rotate
04:21 on every no you get either.
04:22 So it's kind of a fun balance.
04:24 - So as an entrepreneur,
04:26 let's say someone has a job that they don't really like,
04:28 and they're thinking, "I'm gonna quit tomorrow
04:30 "to pursue my passion."
04:32 Would you say, "Go ahead and do that,
04:34 "and, I don't know, pray that you're gonna stay afloat,"
04:36 or, you know, "Stay in your current position and wait?"
04:40 - So I think this is a great sort of 30 under 30 thing, too,
04:43 which is the best time to start a company, if you can,
04:46 is when you're young,
04:47 when you're in school, actually, ideally.
04:49 Because at that point, it's sort of,
04:51 you have a lot more free time, if you will.
04:54 Whereas if you're working, let's say, like, I don't know,
04:57 nine to seven at a company,
04:58 it's gonna be hard to find the free time
04:59 or the energy, really, to go start a different company
05:02 and start a new idea, which takes a lot of energy.
05:04 And so I've always,
05:06 I think we were just really lucky
05:07 that sort of the idea for Reach Orderly
05:09 came from us having worked on a bunch of side projects
05:12 when we were actually at school.
05:13 And that was really helpful,
05:14 'cause during school you can work on so many things, right?
05:16 So I think starting young is ideal, if you can.
05:20 Otherwise, I would say, I think it is risky.
05:22 I have a lot of friends now who are starting companies
05:24 without any idea, just quit their job,
05:26 they're like, "Let's see what happens."
05:28 That I think is really dangerous.
05:29 I think you really wanna have an idea, at least,
05:31 and maybe ideally have proven it out a little bit
05:33 before you leave your job.
05:34 But I think it's a balance, too.
05:36 - It was dangerous, but did it work out in the end?
05:39 - It did.
05:40 For me, it did, but I don't,
05:43 like you said, I was lucky, right?
05:46 And so I think if I were to flip this coin 100 times,
05:49 for example, is it gonna look like this 100 times?
05:51 Certainly not.
05:52 - So what advice do you have
05:54 for those who wanna become an entrepreneur?
05:56 - I think the entrepreneurial skill set, actually,
06:02 is a pretty distinct one.
06:03 It's one where, like aforementioned,
06:07 you have to be open-minded, be low-ego,
06:09 be open to learning, stuff like that.
06:11 But you also have to have conviction in your beliefs,
06:12 for example.
06:14 Maybe one thing I would challenge people to think,
06:17 I think starting a startup now
06:18 has become this exciting thing
06:20 that a lot of people want to go and do.
06:22 I'm actually not sure everyone
06:23 should be starting a startup, actually.
06:24 - Really, why?
06:26 - Well, you may not have the personality for it.
06:27 For example, if you are, let's say, too open-minded,
06:31 I think that's probably bad,
06:32 'cause you don't have enough conviction
06:34 in your own idea, for example.
06:35 If you're too, let's say, closed-minded,
06:37 it also doesn't work either,
06:38 because you're gonna be wrong
06:39 about some large percent of things, actually.
06:41 And so, I think having sort of that low-ego,
06:44 willingness to learn, openness to learn,
06:46 openness to feedback, stuff like that,
06:47 is actually a pretty sort of critical skill set,
06:49 I think, for starting a company.
06:50 And all the skillful founders I know have that.
06:52 And so, if you don't have that,
06:53 maybe you should think about that for a second
06:55 before starting a company.
06:56 - Absolutely.
06:57 Well, David, before I let you go,
06:59 I'm curious, what is one thing you do every single day
07:02 that you believe contributes to your success?
07:05 - I read quite a bit.
07:07 So reading is a lot of fun.
07:09 I think it, sort of different books,
07:12 serve different purposes for me.
07:13 I really like fiction, for example.
07:15 Fiction, I think, is sort of great for building empathy,
07:16 seeing the perspective of others.
07:18 Nonfiction, different purpose.
07:20 - Yeah.
07:21 Well, thank you so much for joining me today.
07:22 - Thank you.
07:23 - Absolutely.
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