20VC: Inside Bending Spoons Acquisition Machine: Evernote, Eventbrite, Vimeo | How Evernote Evaluates Acquisitions and New Product Ideas | How Evernote Mastered Product Launches, User Retention and Monetisation with Federico Simionato

This is 20 product with me Harry Stabbing's now 20 product is the monthly show where we sit down with the best product and design leaders of our time. Today is a very special show. Bending Spoons is on an absolute tear. Last month they acquired Vimeo for a billion dollars. Just this week they acquired Eventbrite for 500 million dollars. They are famed for buying the beloved Evernote previously. And today we're joined by one of their product leads Federico Simeonato. It was such a joy to have him in the studio and I think this is one of the best product episodes that we have ever done. But before we dive into the show today, on this show we care about velocity. Most teams lose it in code review, not in writing code. Now code rabbit fixes that. The second of PR opens, it leaves clear. Line by line comments, cools out what the change might touch and offers one click fixes. 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My biggest takeaway from that episode actually was the fact that they run 26 experiments within the company and then allocated accordingly to who's winning and who's not winning. Thought it was incredible. Now I want to start a little bit on you, dentist games for kids. How did that lead to banding experience and a core role in one of the most coveted companies in Europe? Yeah, so when I was at university, I knew that I wanted to start a startup and so I just jumped at the first opportunity I got. I met a friend who was thinking about starting a startup. We were in Rome for a startup event and he had this idea. He used to be the administrator for his parents' dentistry study and he just saw that if you have to cure a child instead of an adult, you need twice the time and so he was like, "If we can reduce that, it's probably better, right?" And so he thought, "Can we just gamify the experience a little bit?" And the insight was good, but the way we implemented the result, I don't think it was great and so I learned that you should care about what you're thinking of building and so that failed or I mean it's still alive but it didn't scale in a hypergrowth way. And then I just like I wanted this hypergrowth feeling and the way I discovered banding experience was on the internet and I just read the things that were written on the website and they were so ambitious, so clear, so like we know what we are. We are having great results, but we are not satisfied. We are at the scale of downloads of like Twitter or Spotify or stuff like that and they are unknown, right? And I was like, "Who are these people who are getting these results while being unsatisfied by their scale they're at?" And so I started studying, I just applied as you normally do and yeah, I brought some liquor to Matteo, one of the co-founders for my first interview and I like to think that that's what got me the job and yeah and that was almost eight years ago now. Fantastic, love that. We're going to take into the processes with which banding experience build different products across different lines. I do just want to start though, you started a company there and that led into the product role. A lot of people today want to become PMs. What do you find is the best background before entering as a PM? I think the best background to enter as a PM is either being an entrepreneur which teaches you to think about things that matter or being a very good analyst of some kind like somebody who's done very deep thoughtful analysis over how something works and McKinsey, for instance, like Luca did or but even in an academic career it can be with just something who's very thoughtful and looks at the root causes of some behaviors or some things that happen. I think those are both things that matter a lot for a PM. And so that's what matters a lot as PM. We sat there about kind of banding experience creating this incredibly coveted brand. Everyone wants to work at banding experience in Italy if you're in tech. What would you advise someone to get ahead to get a job at banding experience? I think people generally try to follow the steps that are supposed to lend you a job so like you have great CV, you're very polite and professional and that's certainly necessary. But I think that few people try to go the extra mile and try to do something surprising, you know something creative. I really love when people come up with something new. I think there are great touches that you can invent. I mean, I just brought the bottle of liquor and it worked. I mean, it wasn't the only thing for sure, but I like the thing that it helped make an impression, you know, and I like the thing that it was a touch of something creative that not everybody thinks about. The importance of being surprising is very significant. I always actually say like you want to be the purple cow, which is south good, and you know, you drive past cow, no one bothers looking, but then you drive past the purple cow. Wow, it's a big thing. Yeah, I think maybe people out of a lack of confidence, they believe I need to look like I'm standard, you know, like I need to look like I'm, I don't have any rough edge. And I would say, try to show your rough edges a bit and try to show off a few of your characteristics. How is what it takes to be good at product change over the last seven or eight years? I think that the underlying principle is the same. You have to find out what matters and you have to make it good. The way you do that evolves in time. I think with AI, you can build prototypes faster and so that allows you to test easily, which is something you couldn't do in the past, but the underlying principle of you need to focus on what matters is still very true today. I had this wonderful schedule and I'm just going to be blowing up. Sorry, as I said to you, I like real conversations. I do want to go through that, but kind of start at the beginning before that testing element, which starts with an idea. How do you determine which ideas to take and run with versus which to discard within banding spoons? Two ways. We try to find the best ideas by one analyzing the top line. How valuable is this idea? How much revenue is it going to bring? How many more customers is it going to bring? We try to be very qualitative about it. Is it a step change compared to the previous way you do things? These things are generally alternative because you cannot analyze how much of a step change it is if you don't have a prototype. For instance, on every note, I think building things that are useful is the most important thing, but you can never quantify useful. It's very hard to say this feature is more useful than the other, so generally the way we try to do it is we see how many people might need it. Surely you can quantify useful. Useful might be DAU over MA as a metric. But you can't do it in beforehand. You can do it before you release it. You can estimate how many people are going to use a specific thing that you're building and that is a good proxy for it, but you are not sure. Could you not look at comparables in other products? Look at the metrics they have and then take it back from there. Yes, that's the way we try to do it. I'm just saying that sometimes it's more of an estimate game and a gut feeling like I think this is going to be more useful. I think that this feature looks a lot like this other feature that we've built and so it's going to be equally successful, but there's still an element of uncertainty. Some other times you have literally a business case built for a feature. For instance, on wheat transfer we built a feature that allows you to recover expired transfers, which wasn't available before. We noticed that many people were hitting this page where basically we'll tell you the transfer has expired. You cannot download anymore because of course if we had to keep all transfers forever it would just make costs skyrocket and so it's not feasible. And so we thought, well, but if we only allow paying customers to download files after they are expired then we increase the number of paying customers and we just benefit from it and so we can afford to keep the files in storage for longer. And so we were able to model this very accurately in numbers like we had a spreadsheet with a couple different scenarios and we saw what the impact of this feature could be based on how many people were hitting that page daily that the page of expiration, right? So when you build instead an exploratory AI feature on ever node you don't have a business case because you don't know how many people will use it. You can guess but it's different. You said there about modeling what it could be, outcomes, scenario planning. What have you most miss modeled in the downside or the upside? Well, I think when you try to launch something new you always want to look like you're being analytical and so you try to make it look like yeah, I've built a business case for this and there is a scenario in which it works but then when you launch these kind of projects that are like Greenfield they rarely work and so it's kind of hard because yeah, I saw scenario where it could work but it didn't. So for instance, we tried to launch during COVID, I had a small team and we were trying to launch a fitness product for people that were training at home and we were like yeah, let's build a business case for it and the business case was good but then of course you just have to look at the reality of do people actually want to use this product. They wanted but it was very hard to convince them. Why did you decide that was a good idea? Just out of interest fitness products there's so many kind of freemium but you then hit a hard paywall such a saturated market. Why did you decide that was a good idea? Yeah, a few years ago one of our biggest apps was called 30 day fitness. It's still there. It still works. It's still a very good business but at the time it was one of our biggest apps and one of the things that we noticed is that 30 day fitness is a good product because people want it but it's not it's not great at retaining people meaning that after a while people lose the motivation that they need to show up every day, you know, when you're training it's it's hard to every day remake the decision of I'll work out today and so we wanted to solve this and we were like can we find a way to get people to be motivated? And the best way to do it is if you have a personal trainer right but a personal trainer is expensive and so we thought can we make having a personal trainer inexpensive and since during COVID people were used to doing things on zoom or on video calls we were like yeah let's put a few people in a WhatsApp group and have a personal trainer that is paid by all of them so they did just need to pay 120th of a personal trainer but the personal trainer is in charge of keeping each of them accountable. The idea is good but it turns out that it's not enough. You need somebody who calls you out directly like Harry you're not working out today why why are not here today? 30 day fitness you mentioned that still being like a business how much of the money does a business like that make years off towards? I'm not sure what it what it makes today I think it's still in the several millions a year. Is that a paid marketing machine? There's also a lot of organic traffic going to it because people do look for this kind of product. There is a push that people want to be fit you know and so they do things organically but yes I think that most of the traffic for 30 fitness was paid yes. Got it totally we're going to get to kind of paid and how we think about that. I do just want to go back to where we're talking about ideas testing new ideas internally. When we think about like okay impact on top line can you take me to a product decision where the impact on top line has not been significant but it was still important for you to do and how did you think about that? I think Evernote is the best example of this. Many of the things that we do on Evernote are not because we want to increase revenue but it's because we want to make the product more useful and in a very unquantifiable way we just trust that by making the product more useful people will keep choosing to stay on Evernote. Evernote is an archetype is a kind of a product that has great inherent retention because people pour their working hours into it and so that they build their content they get familiar with the with the product but really what we do is we try to make Evernote more useful every day even though we cannot for each individual feature that we build analyze its financial performance. But it's still something that I would still choose to do every day because it's just so important to people even though we can't demonstrate that the ability to collapse sections on a note for instance leads to higher attention the bulk of it. The long tail of features that you build that make the product more useful have to matter in your choice to keep using Evernote every day. How many people still use Evernote? Millions. Millions. Like how many million? I'm not sure I can share but millions of people yes. Wow. Yes. And every day hours a day there are people who run their business on Evernote. It's just that for us working in tech this looks weird because Evernote was popular once and it's not as relevant today in like tech pop culture but if you run like a real estate agency you might have everything on Evernote. What metric do you use to guide product success in Evernote? Is it DAU? To MAU? Is it Alice spent in Evernote? Retention. Subscriber retention is the most important thing on Evernote. Making sure that everything we are doing is either not touching or improving the the turn rate and especially the level at which you are you are retained as a customer. The way I think about retention is it's the percentage of your life that you choose to spend together with a product right. So for instance I am subscribed to Spotify and I've been for I know 10 12 years something like that and I'm a plan on being a subscriber for as many years or even more and so it means that Spotify is very useful to me because I spend I choose to spend decades of my life so like half my life on Spotify and there are people for which Evernote is as useful as Spotify is to me and so they choose to be subscribed to that product for decades of their life and we absolutely must do everything we can to not mess it up. I love that in terms of the commitment-attached periods of your life. What product decision has led to the greatest chance and what did you learn from that? The thing we did on Evernote that produced the biggest turn was when we raised prices in 2023 which is something that we thoroughly analyzed and we ultimately made the decision to do it nonetheless. The reason being we believed and we still believe it that Evernote provides a great deal of value to people that use it and that we could optimize pricing. At the time we thought we could increase prices and people would still consider it a great deal. Not all of them of course. There is a small amount of people who thought Evernote was either already too expensive or kind of at their threshold. It's like when you are subscribed to Netflix and you see that every year or two they increase your subscription and when you receive the email you're like is it still a good deal for me? It's either yes or no and then you make a decision based on am I getting enough out of this product and subscription that I'm accepting to stay subscribed to it and similarly on Evernote we thought let's increase prices in a way that still it's a no-brainer for the vast majority of people accepting that this will be over the threshold and we'll have to let them go. The most unmotivated people, the least advanced ones maybe the ones that were maybe were already thinking about unsubscribing. How much did you increase prices by I think 50% or 60% something like that? That's quite a lot that is different to an Netflix it like a dollar difference where you're like I fuck it but what's interesting is proportionally to the chart numbers you increase prices by 50 or 60% and people go whoa you're making a lot more money in that case. Yes and on one hand it's like economic plates a financial play where you're making more money the thing I like about it is that it all boils down to how useful the product is for you and if it's more useful than what you're paying for it it's a no-brainer decision to stay retained to stay to stay subscribed. Absolutely it also like as you said it separates the flexi user who just switched to another tool very willingly versus something different. Yes do you have any lessons on pricing communication in terms of how to let users know a price is changing the right words to use is email the best way as a push notifications any lessons. I think what you want to do is you want to be confident about what you're doing so that you don't fear communication. If I'm confident that the price I'm asking you to pay is fair then I can tell you 10 times and you will still make the decision of staying retained. If you're trying to like shy away and like should we like use bullshit language and not really tell people that we are increasing their prices that's a bad move and I wouldn't it means that you're not confident that your product is delivering value to people. You just need to accept the fact that some people this new price is going to be over their threshold for for usefulness and just be confident that what you're asking is best for most people. Do you think you make it easy enough for people to unsubscribe from your products? Yeah yeah we invest a lot I mean at the end of the day being here for the long run it's not just about ever not right it's about bending spoons all of our products we are requiring bigger and bigger products instead of making a 2% more revenue on ever note. It's much more important to build a reputation of a company that you can trust and so instead of like some newspaper I think famously asked you to call a phone number to unsubscribe and that was the only way to unsubscribe then you had to wait half an hour to unsubscribe. Instead we review the unsubscription process regularly so that it's not to to cumbersome to frictionful. That's fascinating. So we have the idea process and then we have the oh we've got something that could be a good idea. How do we go from idea to early testing and MVP what does that look like? Yeah it depends a lot product by product so on ever note it's more about sitting down with customers having conversations with them showing them prototypes on Figma for instance does this look like something that you think is useful for you for your use case and then over time we've started knowing our customers better we have a panel of ever not experts that we know well and we know their use cases and so we know that we can always count on them on providing feedback on advanced features when it's a more casual feature maybe we will want to talk to a more like average customer so the way we identify the feature that works on ever not is we just sit down with people and we show it to them we show the prototype to them we show the Figma to them and based on their feedback we just tweak it or maybe even discard it how do you know when to ingest advice and change thus is discarded with customer feedback it's especially important to realize when people are telling you I don't need this and people never tell you I don't need this they generally tell you yeah it looks fine it looks okay and so you have to be there's a great book it's called The Mum Test that you can read and it tells you if you ask your mother did I do okay she's always gonna tell you you did okay right it's she's never gonna tell you yeah you did poorly or this is not good you should ask questions in a way that forces people to tell you yeah I would actually not use this so for instance instead of asking you how often do you work out you will come up with an ideal version of you that says like yeah I work out three times a week but then I ask you how many times have you worked out last week you're like only one but actually it's because I had the meeting and it was a way okay well how many times did you work out the previous week still one because of this other thing the previous week still one and so after a while you notice that the things that people actually do are different from the things that they say and so you should ask people instead of do you like this feature or would you use it you should ask them what's a use case that you had in the last month for which this would have been useful and if they can't come up with any it's a it's a right flag right any other questions that are very helpful and I didn't find that I love that was a use case in the last month any others it depends a lot on who you ask like if we select a user that we know is very active then what we can ask is more like how have you organized your system whenever you're your your hierarchy of information whenever your notebooks your notes in a way that powers your business or powers your professional life for instance instead if you are selecting a user that is maybe a bit more casual or newer then we we should ask more specific questions about like recently what what did you do recently on ever not what what reasons did you have for taking notes it's very difficult when you have a broad set of customers ones which are incredibly advanced power uses and ones which are much more casual how do you advise people on building products for both without alienating either mm-hmm it's not easy it's it's not there's no like silver bullet that you can pull that that makes both happy sometimes you can find things that are useful to both groups you should think about your product very specifically like ever not should we build ever not for casual users what would casual users do they wouldn't pay because they are casual and so they wouldn't invest much on a on a product that just gives them like basic functionality they have loads of competing products that you can choose from apple notes google keep and stuff like that and so it doesn't look like it's a great arena to fight you have great competition that's free and that's pre-installed on your device how can you win that battle instead advanced users you cannot use apple notes if you're very advanced if you cannot use google keep you for a very advanced so that's a battle that we can win so it's very important to realize what arena you choose before you start it's very much the same for content by the way I mean you're very kind in saying that you like the show you know we very much have this question often of do we go deep for fewer or broad for many mm-hmm and it's very tempting to go broad for many because it's nice and ego flashing in some ways but actually we always choose to go deep for fewer and you get much more product love from a fewer number of people yeah I I like the thing that ever note is never going to be as popular as apple notes but at the end of one's life I think an an ever not user will remember their experience in ever not if we've made it delightful enough and I don't think an apple notes user will care much about it no not not because it's a better product just not as relevant do you compare yourself to others and how do you advise product leaders to think about competition I think you should focus on your customers to be honest unless you're like getting started so you don't have a customer base and you need to win people's hearts and you need to win them over if you already have an existing and existing customer base I think your number one job is just to make sure that they love being on that on that product unless you have some crazy insight for by doing this I could 10x my user base it's very hard it's very rare I think you should focus on a lot on your customers you said hey we we get fake mock ups and emotions customers is the way that you're doing design testing changing in a world of AI and if so how when I was working on ever note I still am a lot but but when I was focusing only on ever note we didn't have lovable cursor and these tools and so we were building designs and we were showing them to people and we were asking questions like by looking at this how would you use it now we can build prototypes and even if they are rough we can put them in the hands of people and we can just like ask and use it and and we'll observe it's kind of different like people tell you that they would do something and then in reality when they have a prototype on their computer they would do something different so it's closer to the truth I mean treat do you do Figma and Figma make do you replace that with a lovable build do you actually just go straight to cursor and anthropic and claw code what is that usage on stack look like it depends a lot on the team and the project each team decides they're on stack and we don't impose anything what do they look like there's different then if you take one does say avenue what is avenue and then take a wee transfer what is a wee transfer yeah so on we transfer we have used lovable quite a bit we use cloud code a lot to build prototypes on ever note I think we use Figma a lot still just because it's easier to use the components that we already have to make it look like it's actually the same the same app it's it's a bit of a complex product so it's harder to give the context to an LLM to build things that are that look very close to the original one do you think we are going to skip the design phase in future product buildouts and move straight to prototyping in these more vibe code tools I think so to be honest I think that the role of a designer will be as important as it is today maybe even more but I think that the tools that we use will evolve and so you you won't work on pixels and then code but you will likely merge the two things I remember that when I got started with web development very early when I was in high school I wouldn't have a design that would try to implement I just have like HTML code and CSS and I will try to tweak it to reach my results it was a very manual process but it was all contained inside the code editor right I think that in the future it's going to look like that where you are acting on the code and tweaking the code because it's so cheap and fast that you're just like tweaking the actual thing instead of creating an abstraction and then trying to apply it in the code how does the proportion of designers to engineers change over time with AI it's evolving so rapidly that I don't know how it plays out in terms of team organization if I had to like come up with an answer right now I would say that it's going to make designers faster and you can try more things so today we have a backlog of 100 ideas and we know that we can only try 10 of them in a few months you know I think that we'll reach a point where we can actually try 20 30 40 50 both because people will be faster but also because the manual work to actually implement those prototypes will be much shorter so yeah I think this means that the designer who won't work necessarily on Figma as they do today in the future will work on building these prototypes and coming up with these ideas and they'll do it more and faster. That's fascinating to hear actually how you use different tools across different teams if we progress that a long one stage we have the idea we have the prototyping and putting in the hands of customers we then have the I'm actually going to build it how does the build process look for you internally usually is let's try to close the gap between the prototype and something that is production ready because the prototype if you did it well it's inexpensive and so it means that it lacks a lot of the things that that make it production ready it's basically a probe to some extent we call it a probe it's a piece of software that is built to demonstrate that one metric is X or Y and that's the it's only job and so when people interact with it they give you the answer but it's not ready to be plugged into the brother product and so this way you can get your answer but then in order to be able to plug it to the to the brother product you need to do some work do you think it's important to ship fast and be imperfect or to make sure that that gap between prototype which is a probe to fully beautiful product is seamless and complete I don't adhere to one of the two schools of thought I think speed matters when you're trying things and you're trying to find your way and you're probing the area around you but then it's all about polish when you actually need to build something that millions of people use you cannot have fast and experience do you feel that product difference in terms of behavior very much when you are working on a product like Avernote millions every day versus a much smaller user base with maybe a less frequent usage well for sure you feel more responsibility you feel you also feel like you stand on the shoulder or shoulders of giants in some sense you know like sometimes I talk to Phil Libin who was leading Avernote a few years ago and I don't feel like shipping bad stuff on Avernote just because it's always been such an important product and built in such a caring way that just by comparison I don't want to be I want bending spoons to have the name of those who are releasing sub power experiences on Avernote I want us to have a good threshold for quality so when we have that quality and then we decide launch time okay gotta release this would have been your biggest lessons on how to do product launches or feature launches while when you want to deliver a lot of things to people who need them I think it's important to show that you are every week delivering useful improvements so instead of doing a large and fancy launch you try to do it in a way that feels like every week I'm getting something new you know it really convinces people that you're in for the long run that you are doing stuff that matters and especially that even if this week nothing that's built that's specifically useful to me since I've been here for a while I know that Avernote updates every week and so I know that at some point something will be built that is for me that I that I need and I use instead when you want to innovate and you want to try to like do a step change in the way people use the product then it's important to be very considerate and very clear with communications so for instance let's talk about examples when we build collapsible sections on Avernote or the slash command menu these are utility tools that make your product more ergonomic more polished more useful you don't need to be flashy about this you don't need to like do a huge launch and and to merge them together and to wait six months you you need them to put them in the hands of customers as soon as possible so that they can start getting utility out of it next week we are announcing Avernote V11 and it's going to be a significant change compared to whatever it is today it's mostly a reflection of all the work that went through in the last three years but it's also containing three advanced AI features that are not available on Avernote today and when you do that it's important instead to like kind of make a mess a little bit not not necessarily says that they should be unpolished but like try to be noisy about it so that as many people as possible see that some drastically new functionalities landing on the product totally agree with you then I love you say that hey it's better to do small weekly improvements communicative well than like don't hear from us and then a big splash every six months you do Avernote monthly updates can you just talk to me about that the process of that what you learn and how you advise other product people from doing that this was born out of necessity meaning that when we acquired Evernote there were a few months in which we made the decision to work very deeply on the technological foundations of all Avernote. Avernote was launched in 2007 I think so it's almost 20 years old and so it's not full of bad code necessarily but it's full of old code and it's very important that we innovate that and we make it modern if we want to work on Avernote for the next 10 or 20 years right we made the conscious decision of working on tech foundations but as we were doing that we were also communicating the acquisition and we were raising prices as we were we discussed earlier these three things combined for a customer are a lot a lot to take in and so I think that we should have instead started allocating some percentage of our time improving the product in very visible ways that basically reassured people look we're here for the long run yes we are making drastic changes some of them are uncomfortable right now we truly believe it's the best outlook in the long run we need to do them right now but we are also investing a lot on your user experience we didn't do it and so people were were either skeptical somewhere pissed somewhere we're fine with it didn't they understood but I started doing monthly updates exactly because we saw that it was important to communicate to people while it was changing in the product putting a face behind the product I think is important it is not like bending spoons as a vague entity that is working on ever not it's Federico and his team who are working on ever not what have you learned from doing those monthly updates and how would you advise other product owners or CEOs on doing monthly updates to customers I learned that user feedback matches reality and substance very directly so when you issue a monthly update full of content that nobody needs they'll just tell you this is a relevant I don't need this why are you working on this they're very direct in a way that I find motivating meaning that they're not trying to be kind they're trying to be truthful and so they just tell you if you're working on stuff that doesn't matter to them you can do something very easy you can you can look at our YouTube videos and look at the comments under the videos and see that when we started we were learning and so we didn't get every update right all the time and people will just tell us I'm pissed you raise prices and now you're being the stuff that I don't need why I don't understand lately instead we've become much better at understanding what people actually need what they're asking us and so comments are much more either neutral I like yeah good now I need this other thing or yeah this is finally I've been waiting for this for years it's exactly what I needed thank you so it's the learning is if you do the substance right and you communicate it decently people will tell you if you don't get the substance right people will also tell you people literally you know sit down and take notes with these podcasts which is great and it's like a real compliment to me that we're doing good and valuable things as granular as possible how do you record them how long should they be should they include everything or just like the big highlight how transparent should you be like should you really talk about things that are bad how do you advise me on those yeah I sit down once a month I think it's a decent frequency I think it's enough that people feel like a lot is going on and and not like too frequent where you need to be in front of a camera every every day or every week it should talk about what you're actually doing one thing that that we decided early on when we started doing this is we talk about stuff that either we are ready shipped or that we are launching right now we shouldn't talk about plans that we have for the future sometime we break that rule but it's not like retaining granite but it's important that you don't just entice people with promises you just tell people what they can do today with the product so that you build a sense of practicality and trust and you just tell them look slash comments are available on every note today just update your app and you will be able to use it here is how it works the other side is you also need to teach people how to use this stuff it's a complex product it's not a shallow product by any means so you need to take a couple minutes to show them if something is very new here is how it works so come with me through through the experience so yeah I mean tell people what you've done tell them how it works tell them decently frequently and be upfront about negative stuff as well between my kind of the launch itself and lessons from them what launch was the worst where you expected amazing and it didn't meet expectations and what did you learn from that it wasn't on ever note it's a product that we launched at Benningspoons that we were really hopeful for it was called play on it was apple arcade before apple arcade it's almost exactly the same product right so a subscription you can play high quality games as much as you want you don't need to pay for each individually you don't need to pay to win you don't need to unlock enough purchase you just pay a subscription like Netflix but for for mobile games right we believe that people would love this and it failed we spent I think like five or seven million dollars on licensing and and it eventually didn't work was it immediate the impact that it wasn't working and do you think when you have a product that isn't working you can tell very quickly it depends on how much you're lying to yourself if you're very truthful and you have a plan for how do I validate that it's working with metrics then it's easy if you're like let's put it out there and see what people do it's a bit harder because then you you'll be hopeful you invested a lot in it and you'll try to find signals of usefulness and signals of retention and so yeah you should be very ruthless with yourself before you start and and say these are the metrics that we'll look at when we launch to determine if it's a good product and like I'm the first one who's guilty I often lay too much hope behind the product launch okay so when we look at like play on this like Netflix but for games what did we not see that we should have seen like what's not take away from that to prevent that happening again I think one a big part of it that we learned is that when you watch a movie you watch it two hours and then you're done and the next day you want to watch another movie and so it makes sense for Netflix to exist because people want to consume different content when you're playing a game you get passionate about it and generally games have a much longer lifespan yeah and so you can you can definitely play for a game for a month two months six months even a year I've been I have a mobile version of risk the game the board game on my iPhone I downloaded it when I was in high school I paid for it and I still played where I'm like yesterday I was in an airplane and I and I played it it's been 15 years and you paid once I paid once yes it was a single time purchase wow yeah the lifespan of that of that experience is much longer in time and so it doesn't make sense to pay a subscription for something that that gives you that much runway as someone who's invested in gaming before there is this beautiful retention flatlining actually when you get to a three to five year line which is insane to say but when you look at your games like Candy Crush they still have this insane flatline three to five years in where it almost becomes like a habitual usage every single day yeah I've never worked on that game I worked on an entertainment app that it was very close to a game it's it was called live quiz it was do you remember HQ trivia do you do I remember HQ trivia I'm not I yeah yeah absolutely it is one of a few years ago yeah smart mechanic getting everyone together same time like I think any behavioral change in product is exciting I worked on a clone of HQ trivia as my first project I've been exposed when I joined it went hyper viral in Italy we we did two million registered users in Italy only Italy is is 60 million people in total so one in 30 people used to play that game hyper viral incredible virality and it was so fun it wasn't a good business I think HQ trivia wasn't a good good business either but super viral mechanic but a bit scared of games it's it's very hard to make them work it's even harder than a product in my opinion because it's it's about taste and it's about feelings and emotions and experience utility you as I was saying earlier you can somehow proxy utility you know you can try to guess how useful that change is going to be in the future with games it's about the experience and and the emotions that it gives you it's completely qualitative it's there's there's no I mean of course you can look at metrics and analyze and analyze them but beforehand before you launch it's very hard to to to save your working on a good game or a bad game what did you learn from doing the HQ trivia client how intoxicating working on a successful product can be it's just the experience of a lifetime to work on something that goes hyper viral we literally launched as a beta test with friends and family I remember literally telling people don't tell others because we can only support I don't know 50 users simultaneously 100 users I don't remember another number number but I literally remember asking people not to tell others and we never never never did anything else to to make it grow it just from that moment when I when I told my family my friends don't tell others it just went viral from there we we even set aside some money I think a few tens of thousands of years to do marketing we never touched them it's it's just you just too cough sometimes you can see when a product works immediately does that thing experience do clients today no we we don't launch new products I mean we probably would if we were recently convinced that we have a good shot at making something very good very useful successful impactful I'm not saying that we we wouldn't but no it's been a while since the last time we did play on was one big project didn't hit in the way that you thought it would what did you not expect to hit so suddenly did hit and what did you learn from that we were chatting earlier about never studying your successes which is why we don't actually attribute lessons to them often yeah can you take me to what you didn't expect to hit that did and the lessons sometimes there are things that are they look a bit boring and instead they they just work so for instance I think audio transcription on every note is one such example we were almost about not to launch it because people weren't recording audio on every note and so I mean chicken neck problem right they're not recording audio maybe because they don't want to record audio maybe because there's nothing to do with the audio once once you record it we still decided to launch it because it was just like qualitatively so good it's basically state of the art it's perfect you just talk and it transcribes it's it's literally perfect and so we decided okay let's let's build it and launch it and see what people do with it we just observed people tweeting images of the transcription just because it was so accurate and they were like I'm blown away by how good it is so that's this one example of something that I didn't expect what did you learn from that that you should be very careful with your opinions you should always try to resort to some piece of evidence instead of saying I think it won't work or I think it will work do you have evidence that it's working or not and so if you don't you should try and build evidence and then you should follow that instead of saying I think it won't work or it will work we've covered quite a few different products from you know you we transfers to avenues to ask future via clones to your play ons how is the team structured I think people have this conception or idea that basically banding spoons acquire companies fires the team and centralize this engineering product you can think of banding spoons as a horizontal platform to which we plug individual products the platform is basically everything that you don't need to have at the product level for instance let's let's make a simple talent and recruiting or accounting finance legal but not only that also deep technological teams that power like library data pipelines monetization libraries stuff that can be adopted by each product this way you don't need an ever not recruiting team you don't need a commute monetization technology team you just need to have these pieces at the platform level and then to this platform that where we invest a lot you can plug new products all the time and so this means that the individual product team can be much much leaner than it could be a standalone company and often we we see the difference that it makes like we can acquire companies that are very large and run them with very few people in comparison what's the biggest change say you acquire a company with 500 people and it now runs with 50 yeah the orders of magnet to the around and it's very case specific it's very hard to to there's no like what was ever known and what is it now ever not was a few hundred people and now it's less than a hundred goshy where are there's hundred people that still feels like quite a lot if you actually think about the horizontal platform the legal accounting recruiting data pipeline I mean at the product level so just on the on the specific product does that not feel quite a lot in product I mean it's not on the product measure I'm just talking about the business unit it it contains technology product design data science monetization growth even management you know like all those people are yeah a few tens totally yay can I see you mentioned monetization there and you've mastered across different products payables and moving from premium to premium what have been your biggest lessons in scaling from premium to premium and product again that it's very case specific you don't have a playbook that you then apply to each product let's take a moment as an example on ever note we inherited a monetization structure that was based on basically unlocking advanced features as a user you would pay to unlock business cards kind of for instance or pdf annotation this creates a mismatch between the experience of a free user and advanced user right because you literally have access to a different feature set the way we approached it instead was let's try to make it so that every user sees the power the full power of ever note and so we literally made many features that were previously paid free offline is a big one like offline availability of notes and notebooks used to be a premium feature and now it's free instead we monetize based on content so based on how much you have on the product and so if you want to create a lot then you pay more if you don't create much then you can use it for free so this this basically aligns the incentives of an advanced user I use it hours a day I create tons of notes I pay more and I'm perfectly fine with it I'm a very casual user I don't use it much I have a few notes saying just trying it out you can try the full product without any constraint and you just like reflect the number of notes that you actually have how do you feel about the quite aggressive paywalls I quite often down to consume wraps and instead of the I'm using it very simply by age your faces instead of like the doose free and then you pay more it's like pay more straight away it's a very aggressive paywall strategy how do you feel about how aggressive a paywall strategy should be in any lessons on that the best way to monetize a product is always based on what works on that product so you just try different setups and you see what works it has been the case often where we've made the paywall more visible than in the past just because acquiring products that have already grown and that already have a large user base then you have more to unlock by monetizing people who are already there instead if you're growing a product then you might want to be with less aggressive and just like get people to try more of the product for free because maybe it will improve your K factor it would increase the amount of people that they refer basically if they have a good a deeper experience with the product without interruption it's very case specific another element that I also just find fascinating from a behavioral kind of psychology perspective is push notifications yeah do you have any lessons on what works what doesn't work and how you advise product owners yeah we're not big on push notifications we have used them in some products differently so on every note I think we don't use them at all I mean we'll use them for reminders for people who set a reminder for a note or for calendar events but we don't like use them as a marketing strategy just because we think it would decrease the user experience people would be pissed about it and they would turn them off and so that would reduce the usefulness of the product so we don't do it on the other hand when working on live quits the HQ trigger clone push notifications were literally the trigger to use the product because of course it's happening a couple of times a day always at the same time but if you don't receive the notification there are fewer chances that you actually remember to play and so in that case it was it was a core part of the experience going back to the structure when you acquire a new business a Vimeo and AOL what happens then I know it sounds stupid but like does Luke say hey everyone we're acquiring this who wants to work on it is that how it works we take into account people's preferences like if somebody comes to me and tells me I like to work on Vimeo I'm like that's great it's great to know that some people are passionate about one or the other product I mean at the end of the day I think people are perform better when they are working on something they're passionate about to the extent that it is possible we always try to make it so people are working on stuff that they care about and they're passionate about so so we definitely encourage people to tell us but it's not like we find volunteers to work on a product it's more about functional leads so our CTO or co-founder myself other people we have in mind the structure of the product teams and we try to see where we can find people that are best suited to work on new acquisitions and you're like a Jedi ninja that kind of jumps from new product to new product yeah lately I've done that quite a bit it's a bit uncomfortable because you have to start fresh very often but it's you learn a lot you learn both about the specific characteristics of that product but also about you start seeing some parents about how companies are run and these things do you get nervous yes it's a big transition moving from it respectfully the 30-day fitness to avenue that's a big transition yes and then from avenue to fucking Vimeo and AOL yeah I remember I was on a plane we were about to take off I was in Malpens I think I was living to california to meet the ever-nought team and I was like what am I going to tell these people like like they're true professionals and instead I'm just a guy with some startup experience and what am I going to tell them and so I liked a bit of confidence what I realized is that they're people it's not I was intimidated by the fact that many of them had like 20 years of experience being a VP Yahoo or stuff like that and they're smart professionals but it's not like if they are and they have experience then it means that you cannot talk to them you can just have very rational conversation with people and you just like try to do your best which quality code base was the best when inheriting it I don't dive as deep into the code as my colleagues so I'm not sure I heard that the wheat transfer code base was very good which was the worst or most difficult to inherit doesn't have to be code base but just like when you went into it as a product lead you're like oh well ever-nought I'm not sure it was bad I actually don't think it was necessarily bad but it was complex like just compare wheat transfer to ever-nought wheat transfer in terms of complexity could be one feature of ever-nought and ever-pass like literally hundreds of features so I mean not maybe not the simplest one but but but it's easier as product surface to conceive and to and to think about ever-nought has just has this long tail of small features and it's 20 years old on wheat transfer if you fail and upload people are going to be frustrated but it's not going to be the end of the world if you lose a note you never know it you will receive phone calls and rightfully like understandably it's what should happen and so it's just critical that you do it well not only it's more complex but it's also more critical and you should like triple check everything you're doing so yeah it was difficult do you have horizontal paid marketing machines and band experience and what I mean by that is does the marketing sit as a function on top of the product teams and they are a paid marketing engine for wheat transfer for avenue for Vemier if a while teller or do you have individual paid marketing machines for each entity it's generally individual you can think of of the function versus team as a matrix right each person belongs both to a function and the team so I'm a product manager inside the ever-nought team for instance so I'm inside the product function inside the ever-nought team and so there are people who are inside the growth and marketing function they work on Remy for instance almost all people are who do this are deployed inside business units in terms of their actual location how do you think about effectiveness of remote and product teams I don't have a strong opinion on it meaning that one I see that some of our best contributors work remotely or almost only remotely and it's almost as if having the ability to craft an environment where you are almost cocooned inside your own like habits and environment you can just like deliver your best work without distractions probably for me I'm most effective when I'm at the office but I do love having the flexibility to be able to I don't know meet my parents for a long weekend and just work from from their place I don't think that there's a clear winner between remote and in person I think hybrid is a very good mix of both when you when you need to to attract this level of talent it's an extra requirement to have to ask them you should also be physically in Milan if it's not necessary you just drop it it's a it's a false requirement you know you work with American teams you often inherit and European teams that you sit with day to day how do they differ in terms of work ethic psychology mentality honestly I don't see that that big of a difference you just know I it's not like I spot a trend in how I don't know the wheat transfer team versus the ever not team just to mean to the day work very closely with wheat transfer was based mostly in in Amsterdam some people in London too ever not in the US mostly in the valley I don't see a direct difference in culture was this dream your acquisition successful yes I mean I'm thinking about ways it could be defined as not successful but none come to mind it was a success financially speaking we were able to increase revenue a lot it was a success in terms of how much we were able to improve the product yeah I would say it's definitely a success dude I wonder a quick fire out with you so I say a short statement you give me and you're immediate thoughts which company has bending spoons not acquired that you would most like to acquire because it would be great to work on I mean I don't want to sound arrogant but I think I would love to work on Google it would be why it's just one of the best product in Google search Google search but in general the Google ecosystem like they just have so much surface so so much intellectually stimulating stuff that you could work on I one of my favorite products is Google Maps just because of how useful it is every day you know and and just even working on Google Maps we would be great just as as my like literally my personal taste it would be great but YouTube Android Google search all the AI stuff that they're doing it it's just like theme park world for for opian I think what is the most non-obvious app on your home screen that you love let's check yeah it's dead polytopia it's it's it's a it's a it's a mobile game and actually it's covered it because apparently Elon Musk is a big polytopia player it's a turn-based strategy it looks like civilization the game but it's mobile it's a bit simpler when you're when you have 10 minutes you just play a match there it's nice another one is napper napper is a so I had a baby in April and napper is the app in which I log every time we feed their every time she takes a nap so yeah and it's good at predictions too it literally is able to tell you when she's going to fall asleep with a inaccuracy of minutes happy it was like a banding experience company yeah it might be yeah yeah tough retention your attention now it's like fuck it that four years old they don't nap anymore depends on how many babies you have but yeah yeah it's true but you're gonna get some churn in between days yeah yeah what is the most non-obvious skill that a PM needs to be successful I think great PMs are entrepreneurs at heart at least like people who can come up with valuable ideas find a way to implement those ideas well focus on what matters meaning that the idea needs to be irrelevant for a goal being successful financially is one but also like doing stuff that gets that goes viral and gets a lot of coverage I mean depends on the goal but you need to be very focused on what matters the best entrepreneurs are great creative people that come up with ideas designers are thinking what the UX should look like project managers that get the team to ship fast and and they ship fast with the team so I think I think being an entrepreneurial is a hell of a skill for a PM raplet or lovable you can only choose one I don't know I think our teams use lovable more than raplet I personally use raplet more than lovable though why I prefer the UX it's just that Claude code okasa so I tweeted about the AOL acquisition and the tweet went viral and I noticed randomly a few large accounts followed me it's not like I saw all of the followers and I went through the list and I didn't have time to do it and so I said let's see if I can rank my followers by how large their accounts are but there's no tool that does that and so I was like yeah let's see if I can build a little tool to do that I'm paid a lot of money for this if you see and I see do you have that I have it doesn't work super well but it works I built it with cursor initially and then it didn't work and then I built it with Claude code and it didn't one shot it but it I saw that it was improving the things that were broken faster and so I went with Claude code that in the end wow love that which wins ultimately I think at the end of the day what you want to do is to have the preview on the right and the chat on the left or vice versa but but I think the code will become irrelevant but I'm biased I'm a PM so I care about the prompt and the result but I think that ultimately what you want to do is to deliver a great UX by giving the right commands so I think that the Claude code is the way to go but I think that cursor is a better UX today when manually looking at code and knowing the code still matters a lot seven and a half years depending experience you can call up for the night before your first day okay and say ah I've done this before and you should know this what would you tell yourself on that night before be bolder I think sometimes I waited for somebody to give me permission to do stuff as if I was in school and instead when you when you start doing stuff autonomously and it looks like it's something smart and it can work people will just cheer for you it's not like anybody's going to stop you at least not a bonus if you have an idea for something that works we're just going to be enthusiastic about you trying it so I tend to be high agency but but I didn't have the confidence to just start doing stuff and and I'm glad that they they pushed me to do it but I would just tell myself be bolder start more things if I wasn't afraid I would do dot dot dot I love neural ink I think neural ink is the product like like the thing that can change the world the most in 50 years including AI in my opinion so I know I know people love AI I love AI I use it every day but I think that ultimately the way you perceive reality and the way it changes through neural ink is going to be a bigger difference compared to having hyper smart hyper smart computers so yeah so so neural ink if I wasn't afraid to fail I would start a neural ink competitor or find a way to work it on neural ink or even better start a neural ink product inside Benin's books. Fedet this has been so much fun Steve thank you so much for joining me and I so appreciate you taking the time I loved it thank you very much but before we leave you today on this show we care about velocity most teams lose it in code review not in writing code now code rabbit fixes that the second of PR opens it leaves clear line by line comments calls out what the change might touch and offers one click fixes you can teach your organizational standards using your own custom instructions such as cursor or Claude rules and enforce them on every PR code rabbit has so far reviewed more than 13 million PRs and installed on two million repositories used by over a hundred thousand OSS projects if you want to cut code review time and bugs in half try a free month that code rabbit dot AI with the code 20 VC and while code rabbit keeps your code clean warp dev makes it fly AI coding is everywhere but most of it honestly it's pretty chaotic code that is almost right but you don't really understand well that's why warp exists with warp the old lines between terminal and IDE disappear it's a seamless environment for coding with agents where you can prompt plan review and ship production ready code and it files in app review diffses you go and deploy straight to production without switching tools warp tops the benchmarks literally number one on terminal bench top five on software engineering bench verified and is trusted by over 600 thousand developers and used by 56% of the fortune 500 engineering teams making it one of the fastest growing AI companies with revenue growing 30x this year with warp you don't just get speed you get code you can trust the average developer saves five hours a week with warp it's almost half a day try warp for free at warp dot dev forward slash 20 VC and to get pro for only five dollars for your first month use the code 20 VC that's 20 VC