Julia Schottenstein (dbt Labs)13 July 2023

M&A, competition, pricing, and investing

8Frameworks

15Insights

Episode overview

Julia Schottenstein explains why founders should build M&A optionality early, become strategically important to a small set of likely buyers, and remain friendly enough to preserve future conversations. Drawing on dbt Labs' acquisition of Transform, she discusses competition, open-source distribution, pricing research, and the product principles behind dbt's growth. She also describes how her venture-capital background informs her evaluation of people, markets, products, distribution, risk, and high-upside product bets.

Key ideas

Evaluate early-stage companies across four dimensions: people, market, product, and distribution.
For M&A, identify the two or three most strategic buyers, create noticeable competitive pressure, and preserve friendly relationships and optionality.
If a company urgently needs an exit, communicate transparently, use investors and corporate-development teams for introductions, and emphasize the team being acquired.
dbt's growth combined a simple but powerful product, open-source adoption, strong timing during cloud-data-warehouse expansion, and close customer learning through consulting.
Competition strategy at dbt Labs centers on staying true to the vision, growing the market with ecosystem partners, and leaning into defensible strengths.
Pricing research should begin before a product is built and combine customer conversations, relative-value questions, financial modeling, and observed conversion and churn.
Shipping a good-enough product enables learning; Julia summarizes this as “worse is better” and “tech debt is a champagne problem.”
Product managers can strengthen judgment by cultivating an operator network, becoming T-shaped generalists, and making selective bets with trajectory-changing upside.

Transcript available · source text is retained privately and is not published

Frameworks in this episode

Leadership4 steps

Embodied Algorithm Offsite

Make the team physically become the system so nobody can leave without understanding it

Read →

Strategy6 steps

Inflict Pain, With a Smile

Get acquired by becoming the competitor your buyer cannot ignore — while staying their friendliest partner

Read →

Entrepreneurship5 steps

People, Market, Product, Distribution

The four-lens screen for investing in — or joining — an early-stage company, with distribution weighted highest

Read →

Strategy5 steps

The Buyer Set of a Dozen

Run a real sale process: build a 12-name list, disqualify against the sit-out criteria, then call it

Read →

Innovation4 steps

The Open Core Line: State and Collaboration

Open-source the standard where logic is written; charge for stateful and cross-team work

Read →

Strategy4 steps

The Three-Pillar Competition Philosophy

Hold true to your vision, grow the pie, lean into strengths — and name the two things you defend

Read →

Finance6 steps

Willingness-to-Pay Before You Build

You don't choose whether to have the pricing conversation — only when. Have it before you ship.

Read →

Productivity4 steps

Worse Is Better, Tech Debt Is a Champagne Problem

Ship the embarrassing version — you only earn tech debt if people actually use the thing

Read →

People & resources mentioned

Attributed to the moment in the episode. Timestamps are approximate.

People · 17

Julia SchottensteinMentionsJulia is a product leader at DBT Labs where she leads the DBT Cloud product
“Julia is a product leader at DBT Labs where she leads the DBT Cloud product”
▶ Watch at ~1:00approx.
Julia SchottensteinMentionsJulia is a product leader at DBT Labs where she leads the DBT Cloud product
“she's also the co-host of the DBT Labs podcast called analytics engineering podcast”
▶ Watch at ~1:00approx.
Lenny RachitskyMentionstoday we've got another very special compilation episode something I've been pulling on more and more with the podcast and the newsletter
“welcome to Lenny's podcast where I interview worldclass product leaders and growth experts”
▶ Watch at ~1:00approx.
Tristan HandyMentionsTristan who's the CEO and founder
“I naturally Tred to spend all my time getting close to Tristan who's the CEO and founder”
▶ Watch at ~6:00approx.
Nick HandelMentionsthe founder of transform who kind of LED this exercise at DBT Labs
“I'll give Nick handle the the founder of transform who kind of LED this exercise at DBT Labs”
▶ Watch at ~18:00approx.
Connor McArthurCoinedour Founders Tristan Drew and Connor
“our Founders Tristan Drew and Connor they had a belief”
▶ Watch at ~21:30approx.
Tristan HandyCoinedTristan who's the CEO and founder
“our Founders Tristan Drew and Connor they had a belief”
▶ Watch at ~21:30approx.
Drew BaninCoinedour Founders Tristan Drew and Connor
“our Founders Tristan Drew and Connor they had a belief”
▶ Watch at ~21:30approx.
Madhavan RamanujamCoinedmadhavan is the author of monetizing innovation the most widely read book on pricing strategy he's also senior partner at Simon Kutcher and partners
“I always think about mavon who wrote This Book pricing Innovation”
▶ Watch at ~32:30approx.
Hunter WalkMentionsthis uh VC Hunter walk he's a founder of Home proof Ventures
“this uh VC Hunter walk he's a founder of Home proof Ventures had this interesting blog post”
▶ Watch at ~36:30approx.
Joe ZadehMentionsthe had of product at Airbnb Joe bot remembered it
“the had of product at Airbnb Joe bot remembered it and came back to us a year later”
▶ Watch at ~39:00approx.
Leonardo da VinciMentionsLeonardo D Vinci say that Simplicity is the ultimate sophistication
“a few of my favorites are snowball that Buffett made in America about Sam Walton and Leonardo da Vinci”
▶ Watch at ~57:00approx.
Sam WaltonMentionsmade in America about Sam Walton
“made in America about Sam Walton and Leonardo da Vinci”
▶ Watch at ~57:00approx.
Warren BuffettMentionsWarren Buffett who's outstanding arguable genius
“a few of my favorites are snowball that Buffett made in America about Sam Walton and Leonardo da Vinci”
▶ Watch at ~57:00approx.
Brett BersonMentionsit's first rounds podcast by Brett Baron he interviews a lot of operators
“it's first rounds podcast by Brett Baron he interviews a lot of operators about how they do their very best work”
▶ Watch at ~59:00approx.
Logan BartlettCoinedanother podcast that I really like is the Logan Bartlett show
“another podcast that I really like is the Logan Bartlett show”
▶ Watch at ~59:00approx.
Todd JacksonMentionsDescribed as a former Gmail product leader and venture capitalist.
“and in-depth I think Todd Jackson actually host a lot of the episodes too”
▶ Watch at ~59:30approx.

Resources · 42

Lenny's PodcastCoinedpodcast · Lenny Rachitsky
“welcome to Lenny's podcast where I interview worldclass product leaders and growth experts”
▶ Watch at ~1:00approx.
dbt CloudMentionssoftware · dbt Labs
“where she leads the DBT Cloud product”
▶ Watch at ~1:00approx.
dbt LabsMentionscompany · Tristan Handy, Drew Banin, and Connor McArthur
“Julia is a product leader at DBT Labs where she leads the DBT Cloud product”
▶ Watch at ~1:00approx.
VantaMentionssoftware · Christina Cacioppo
“this episode is brought to you by vanta helping you streamline your security compliance to accelerate your growth”
▶ Watch at ~2:00approx.
SuperhumanMentionssoftware · Superhuman
“this episode is brought to you by superhuman”
▶ Watch at ~3:00approx.
NEAMentionscompany
“I used to be a professional investor at nea”
▶ Watch at ~5:00approx.
dbtUsessoftware · dbt Labs
“when I talked to people that were using it the way that they described their experience on DBT”
▶ Watch at ~5:30approx.
SnowflakeMentionscompany · Snowflake Inc.
“this was the year where snowflake went from A4 billion doll company to a 12 billion doll company”
▶ Watch at ~6:00approx.
Sequoia CapitalMentionscompany
“I ended up losing that deal to Sequoia”
▶ Watch at ~7:00approx.
TransformMentionscompany · Nick Handel and James Mayfield
“you led the acquisition of a company I was an investor in the DBT acquired that I think is public company called transform”
▶ Watch at ~13:30approx.
TransformMentionscompany · Nick Handel and James Mayfield
“we just bought this company transform”
▶ Watch at ~15:00approx.
AirbnbMentionscompany · Brian Chesky, Joe Gebbia, and Nathan Blecharczyk
“they had the benefit of having worked at Airbnb”
▶ Watch at ~16:30approx.
MinervaMentionssoftware · Airbnb
“Airbnb in the data world is is famous for having a really successful like semantic layer metric layer called manura”
▶ Watch at ~16:30approx.
dbtMentionssoftware · dbt Labs
“DBT is open source and that's the the main kind of guts of of DBT where you write your business logic”
▶ Watch at ~22:00approx.
Fishtown AnalyticsMentionscompany · Tristan Handy, Drew Banin, and Connor McArthur
“DBT lab started as Fishtown analytics a consulting firm”
▶ Watch at ~25:00approx.
Gödel, Escher, BachRecommendsbook · Douglas Hofstadter
“I'm a huge math nerd and one of my favorite books on logic is called girdle eer Bach”
▶ Watch at ~26:30approx.
Ted LassoMentionstv show · Bill Lawrence, Jason Sudeikis, Brendan Hunt, and Joe Kelly
“reminds me of a clip from this last season of Ted lasso where they have used red strings”
▶ Watch at ~29:00approx.
AssemblyAIMentionscompany · AssemblyAI
“today's episode is brought to you by assembly AI”
▶ Watch at ~30:30approx.
Monetizing InnovationCoinedbook · Madhavan Ramanujam and Georg Tacke
“I always think about mavon who wrote This Book pricing Innovation”
▶ Watch at ~32:30approx.
dbt CloudMentionssoftware · dbt Labs
“my team builds proprietary software for DBT cloud”
▶ Watch at ~34:00approx.
HomebrewCoinedcompany · Hunter Walk and Satya Patel
“this uh VC Hunter walk he's a founder of Home proof Ventures”
▶ Watch at ~36:30approx.
LocalmindCoinedsoftware · Lenny Rachitsky and co-founders
“I had a startup local mine that we sold to airb B”
▶ Watch at ~38:30approx.
AirbnbMentionscompany · Brian Chesky, Joe Gebbia, and Nathan Blecharczyk
“I had a startup local mine that we sold to airb B”
▶ Watch at ~38:30approx.
South by SouthwestMentionsevent
“at a random party at South by Southwest”
▶ Watch at ~39:00approx.
FigmaMentionssoftware · Figma
“I'm actually doing a post right now on Snowflake and on figma”
▶ Watch at ~49:00approx.
RedditMentionswebsite · Steve Huffman, Alexis Ohanian, and Aaron Swartz
“I'm working on a different post around Reddit and how to work with really opinionated users”
▶ Watch at ~50:00approx.
SlackUsessoftware · Slack Technologies
“we have a DBT slack community of 50,000 and all of our employees are like in that slack”
▶ Watch at ~51:30approx.
RabbitMQMentionssoftware
“what we didn't need at launch was a distributed scheduler with gow workers and rabid mq”
▶ Watch at ~53:30approx.
RangeRecommendsbook · David Epstein
“two books that helped me learn a lot about myself range it's a book about generalist and also quiet”
▶ Watch at ~57:00approx.
Sam Walton: Made in AmericaRecommendsbook · Sam Walton and John Huey
“a few of my favorites are snowball that Buffett made in America about Sam Walton and Leonardo da Vinci”
▶ Watch at ~57:00approx.
The SnowballRecommendsbook · Alice Schroeder
“a few of my favorites are snowball that Buffett made in America about Sam Walton and Leonardo da Vinci”
▶ Watch at ~57:00approx.
QuietRecommendsbook · Susan Cain
“range it's a book about generalist and also quiet it's a book about introverts”
▶ Watch at ~57:00approx.
SuccessionRecommendstv show · Jesse Armstrong
“I like succession but I have not seen the latest season”
▶ Watch at ~57:30approx.
BeliUsessoftware
“I like belly it's a consumer social app that lets you find and discover restaurants and rate them and with your friends”
▶ Watch at ~58:00approx.
New York CityMentionsplace
“it's been a lot of fun looking at the New York City restaurant scene”
▶ Watch at ~58:30approx.
In DepthRecommendspodcast · First Round Capital
“other podcasts that I really like are in-depth it's first rounds podcast by Brett Baron”
▶ Watch at ~59:00approx.
The Logan Bartlett ShowRecommendspodcast · Logan Bartlett
“another podcast that I really like is the Logan Bartlett show which touches on timely uh Trends in in Tech”
▶ Watch at ~59:00approx.
The Analytics Engineering PodcastCoinedpodcast · dbt Labs
“it's called the analytics engineering podcast so if you want to learn more about the data industry I host it”
▶ Watch at ~59:00approx.
The Analytics Engineering PodcastRecommendspodcast · dbt Labs
“it's called The analytics engineering podcast and it's just in podcasting apps”
▶ Watch at ~59:30approx.
TwitterUseswebsite · Twitter
“you can find me on Twitter Jore shottenstein”
▶ Watch at ~1:00:00approx.
Apple PodcastsMentionssoftware · Apple Inc.
“you can subscribe to the show on Apple podcast Spotify or your favorite podcast app”
▶ Watch at ~1:00:30approx.
SpotifyMentionssoftware · Spotify
“you can subscribe to the show on Apple podcast Spotify or your favorite podcast app”
▶ Watch at ~1:00:30approx.

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Insights & moments

The myth-busts, hot takes, explainers, and tools worth keeping.

Hot Take· 4

Hot Take14:00

M&A Is About Creating Plan Bs — Inflict Pain, But Stay Friendly

Julia's core M&A advice: for any company there are only two or three buyers who find you strategic. Find the area where you have a competitive advantage and inflict pain on that potential buyer so they can't ignore you — but keep the relationship friendly and open, because founders who take too competitive a stance prematurely shut the door on optionality.

The best M&A strategy is a strong offense — the ability to stay independent gives you leverage in every conversation
For any one company there are only two to three genuinely strategic buyers
Inflict pain on a potential buyer in your area of advantage so they notice you
Do it while staying friendly and open; don't shut the door prematurely

“I would figure out the area that you bring a competitive advantage and I would inflict pain on that potential buyer make it impossible for…”
Julia Schottenstein · 15:00

“the really important piece here is you want to do that in a way that's still friendly and open I see a lot of Founders…”
Julia Schottenstein · 15:30

#m&a#strategy#fundraising#optionality

Hot Take33:00

'We're Happy to Lose to Ourselves': Value Creation Over Value Capture

One of dbt's core values is being more concerned with value creation than value capture. Customers say dbt is worth 20–35% of what they spend on their cloud data warehouse, yet dbt charges only a small fraction of that by design. Most deals the paid team loses are lost to dbt open source — and they like it that way.

A core value: more concerned with value creation than value capture
Customers value dbt at 20–35% of their cloud data warehouse spend
dbt deliberately charges only a small fraction of that value
When the paid team loses a deal, it most often loses to dbt open source — by design

“when we lose a deal we most often lose it to DBT open source and we like it that way we're we're happy to lose…”
Julia Schottenstein · 34:00

#pricing#values#open-source#dbt

Hot Take41:00

Sometimes You Should Quit — Your Investors Aren't Getting Their Money Back

Julia offers a candid, possibly unpopular take: investors already understand they won't get their money back, and 50% of early-stage portfolios return nothing. What they actually want is for founders to land somewhere great, not to grind out a mediocre outcome. Against the grit-and-never-quit mantra, sometimes quitting is the right, acceptable call.

Investors understand they may not make their money back — half of portfolios return nothing
They'd rather you end up at a great company than force a small outcome
Don't stay stuck at a company you hate just to return some money
Against grit-and-never-quit advice, sometimes you should quit

“to get stuck at a company they hate and just so that they could return some money or have some kind of outcome like I'd…”
Lenny · 42:00

“a lot of times for Founders that are told like it's all about grit and not giving up and don't quit sometimes sometimes you should…”
Julia Schottenstein · 42:30

#founders#investing#exit#mental-health

Hot Take52:00

Worse Is Better, and Tech Debt Is a Champagne Problem

Not a framework person, Julia leans on two sayings to fight perfectionism: 'worse is better' and 'tech debt is a champagne problem.' Shipping good-enough is when you actually learn from users. She points to dbt's first scheduler — an embarrassingly naive for-loop over a jobs table — that got the job done and only needed rebuilding once real scale (8,000 companies, 10M runs/month) arrived.

Two sayings fight perfectionism: 'worse is better' and 'tech debt is a champagne problem'
You can't anticipate real usage until you ship
dbt's first scheduler was a naive for-loop over a jobs table — and it worked
Tech debt means people are using the product; they didn't need a distributed scheduler with no users

“and it's uh um worse is better and Tech debt is a champagne problem”
Julia Schottenstein · 52:00

“and I try to remind the engineers like we would be so lucky to have tech tech debt because that means people are using the…”
Julia Schottenstein · 53:30

#shipping#tech-debt#product#engineering

Explainer· 4

Explainer11:00

The Clearest Product-Market-Fit Signal: Users Who Can't Stop Talking About It

Asked what specifically signals a company is special, Julia points beyond the emotional 'I want this now' reaction to a stronger tell: users who can't stop talking about the product and want to share it with teammates and people at other companies. That organic chatter does a lot of the go-to-market work because evangelists come from your user base.

Beyond an emotional reaction, the real signal is users can't stop talking about the product
Chatter and wanting to share it with teammates and other companies is a great sign
Top-of-mind love means your users become your evangelists and drive distribution

“yeah it's can they not stop talking about it and that's this like the chatter about a product they want to share it with like…”
Julia Schottenstein · 11:30

#product-market-fit#distribution#early-stage

Explainer18:00

dbt's Competition Philosophy: Hold the Vision, Grow the Pie, Lean Into Strengths

Julia shares the three pillars dbt codified for handling competition. Hold true to your vision and treat competitor shade as noise; adopt a grow-the-pie mindset that partners with the ecosystem to expand the total opportunity; and lean into your strengths while leaving space for partners, defending only the transformation and semantic standards.

Hold true to your vision — most competitor noise is a distraction; run your own race
Grow the pie — work with ecosystem partners to expand the opportunity rather than slice it thin
Lean into your strengths but leave room for the ecosystem to serve users
dbt only holds its ground on the transformation and semantic standards

“if you have a lot of conviction that you're going in the right Journey you want to just keep your eyes straight ahead and run…”
Julia Schottenstein · 18:30

#competition#strategy#dbt#ecosystem

Explainer29:30

dbt's Open-Core Line: Open Source the Guts, Charge for State and Collaboration

Julia explains how dbt decides what stays open source versus proprietary. The open-source core is the guts of data transformation — where you describe your business logic — because keeping the standard open matters to the ecosystem. What dbt reserves for its paid Cloud offering is anything stateful and any cross-team or structural collaboration that supercharges the development lifecycle.

The open-source core is the guts of transformation — where you write business logic
Keeping the standard open is important for the ecosystem
Stateful interactions are reserved for the proprietary Cloud offering
Cross-team and structural collaboration are also part of the paid product

“what we think about as leaving for our Cloud offering is we deal with state so stateful interactions and also any kind of cross team…”
Julia Schottenstein · 30:00

#open-source#open-core#pricing#dbt

Explainer45:00

The M&A Code Words: If You Have Time, Don't Say M&A at All

Julia advises against being too clever with M&A phrasing — everyone knows 'evaluating strategic alternatives' means you're for sale. If you have runway, don't talk about M&A at all; talk about collaboration, partnerships, and knowledge sharing. If you're out of time, you're out of time and should be transparent.

Everyone understands 'evaluating strategic alternatives' means you're selling
If you have time, don't raise M&A; frame it as collaboration or partnership
M&A is a dirty word when you still have runway to pursue independence
If you're out of time, just be transparent

“if you have time then don't talk about m&a at all like that's the last thing that you want to speak about instead you're talking…”
Julia Schottenstein · 45:30

#m&a#negotiation#strategy#exit

Story· 3

Story06:30

The VC Who Bet 20% of Her Net Worth on DBT — Then Joined It

Julia describes her unusual path from professional early-stage investor at NEA into product management at dbt Labs. She was so convinced dbt was special that she asked to put ~20% of her liquid net worth into the round, lost the deal to Sequoia, and later called the CEO to ask if she could join the company instead.

Investors interested in product and vice versa is more common than people assume
She discovered dbt in 2019 as an open-source data transformation framework and was struck that users treated it as an identity, not just a tool
She asked to invest ~20% of her liquid net worth and lost the deal to Sequoia
The board vetoed her personal investment, so she joined dbt Labs to build the product instead

“I asked to put like a very irresponsible IR rational amount um nearly like 20% of my liquid net worth into DBT because I was…”
Julia Schottenstein · 07:00

#career#investing#dbt#product

Story16:00

How dbt Acquired Transform: A Friendly Rival With Product but No Distribution

Julia tells the story of dbt acquiring Transform, a pure-play semantic-layer company built by ex-Airbnb engineers. Transform had strong technical product and was vocal about solving hard problems but lacked distribution, while dbt had distribution but was behind on product. Because Transform positioned itself as a friendly partner and had already built dbt integration, the acquisition and post-deal integration went smoothly.

Transform was a pure-play semantic/metric layer company with strong technical product
They came from Airbnb, famous for its Minerva semantic layer
dbt had distribution and ecosystem but was behind on bringing the product to market
Transform applied pressure while positioning as a partner, which made the acquisition and integration easier

“we felt that pressure from transform because they were doing such a great job at being vocal and loud about how their semantic layer solves…”
Julia Schottenstein · 17:00

#m&a#dbt#semantic-layer#acquisition

Story26:30

Tying Up Engineers With Rope to Teach a New Algorithm

Inspired by an ant-farm scene in Gödel, Escher, Bach, Julia ran a team offsite where she used a spool of rope and sticky notes to physically build a graph — each engineer a node, the rope the edges — and walked the team slowly through a new data-transformation algorithm. The point was ownership: no one could leave without fully understanding it, so the whole team internalized every edge case rather than a few people running ahead.

The exercise was inspired by an ant-farm scene in Gödel, Escher, Bach
Engineers became nodes and rope became edges of the transformation graph
The goal was shared ownership so the team could anticipate all edge cases
The underlying change flipped dags from an imperative to a declarative model

“so I showed up to a team offsite with uh spool of rope and uh sticky notes and I think my team looked at me…”
Julia Schottenstein · 27:30

“and it was a way that you couldn't leave that exercise without knowing exactly what was going on because everyone had a role to play”
Julia Schottenstein · 28:00

#team#leadership#engineering#dbt

Q&A· 1

Q&A36:30

Should You Be Public That You're Selling? In a Hail Mary, Yes

Responding to Hunter Walk's argument that founders should be public about selling, Julia agrees it's good advice in a Hail Mary situation. Trying to be cute or evasive to drum up fake competitive interest doesn't work in today's climate where too many companies are visibly in that spot. There's no shame in a plain note saying you're looking for an exit.

Being transparent and casting a wide net is right when you need an exit
Founders used to be evasive to fake competitive interest; that no longer works
There's no shame in a simple note saying you're running a process
In team-acquisition scenarios, a clean data room of team members matters most

“there's absolutely no shame in sending a note that says something like hey we're looking for an exit for our company X Y and Z…”
Julia Schottenstein · 38:00

#m&a#selling#fundraising#exit

Tool· 1

Tool57:00

Julia's Book and Product Picks: Range, Quiet, Snowball, and Beli

In the lightning round Julia recommends two books that helped her understand herself — Range (about generalists) and Quiet (about introverts) — plus biographies she loves: Snowball, Made in America (about Sam Walton), and Leonardo da Vinci. Her recent favorite product is Beli, a consumer social app for finding and rating restaurants with friends.

Range — a book about generalists
Quiet — a book about introverts
Biography picks: Snowball (Buffett), Made in America (Sam Walton), Leonardo da Vinci
Beli — a consumer social app for discovering and rating restaurants with friends

“so two books that helped me learn a lot about myself range it's a book about generalist and also quiet it's a book about introverts”
Julia Schottenstein · 57:00

#books#recommendations#products#lightning-round

Takeaway· 2

Takeaway25:00

dbt Spent Two Years as a Consulting Firm Feeling the Pain Firsthand

A big part of dbt's story is that dbt Labs started as Fishtown Analytics, a consulting firm, for nearly two years. Working hands-on with clients' day-to-day data problems let the founders feel real pain firsthand and build fixes directly into dbt whenever they hit friction — maturing the product in a way that's hard to replicate.

dbt Labs began as Fishtown Analytics, a consulting firm, for almost two years
Working hands-on with clients surfaced real, firsthand pain points
Friction and paper cuts encountered in client work were built directly into dbt
Right-place-right-time (the cloud data warehouse boom) plus close customer work created the product

“whenever they encountered paper cuts or friction or the workflow was taking longer than they expected they would build that into DBT and that really…”
Julia Schottenstein · 26:00

#founding-story#dbt#product-development#consulting

Takeaway31:30

You Don't Decide If You'll Have a Pricing Conversation — Only When

Citing Madhavan Ramanujam's book on pricing, Julia argues that pricing and willingness-to-pay conversations are inevitable — you only get to choose their timing. It's far better to have them before you build than to discover, at sales time, that people aren't willing to pay for what you shipped. Many startups delay this, a side effect of the zero-interest-rate era of funding stars and usage over revenue.

You don't get to decide whether to have a willingness-to-pay conversation, only when
Have it before building rather than when sales is already trying to sell
Delaying pricing was a side effect of zero-interest-rate funding of usage over revenue

“you don't get to decide if you're going to have a pricing or willingness to pay a conversation you only get to decide when”
Julia Schottenstein · 32:30

#pricing#willingness-to-pay#startups

Key ideas

Frameworks in this episode

Embodied Algorithm Offsite

Inflict Pain, With a Smile

People, Market, Product, Distribution

The Buyer Set of a Dozen

The Open Core Line: State and Collaboration

The Three-Pillar Competition Philosophy

Willingness-to-Pay Before You Build

Worse Is Better, Tech Debt Is a Champagne Problem

People & resources mentioned

People · 17

Resources · 42

Insights & moments

◆Hot Take· 4

M&A Is About Creating Plan Bs — Inflict Pain, But Stay Friendly

'We're Happy to Lose to Ourselves': Value Creation Over Value Capture

Sometimes You Should Quit — Your Investors Aren't Getting Their Money Back

Worse Is Better, and Tech Debt Is a Champagne Problem

✶Explainer· 4

The Clearest Product-Market-Fit Signal: Users Who Can't Stop Talking About It

dbt's Competition Philosophy: Hold the Vision, Grow the Pie, Lean Into Strengths

dbt's Open-Core Line: Open Source the Guts, Charge for State and Collaboration

The M&A Code Words: If You Have Time, Don't Say M&A at All

❝Story· 3

The VC Who Bet 20% of Her Net Worth on DBT — Then Joined It

How dbt Acquired Transform: A Friendly Rival With Product but No Distribution

Tying Up Engineers With Rope to Teach a New Algorithm

?Q&A· 1

Should You Be Public That You're Selling? In a Hail Mary, Yes

✦Tool· 1

Julia's Book and Product Picks: Range, Quiet, Snowball, and Beli

▲Takeaway· 2

dbt Spent Two Years as a Consulting Firm Feeling the Pain Firsthand

You Don't Decide If You'll Have a Pricing Conversation — Only When

Hot Take· 4

Explainer· 4

Story· 3

Q&A· 1

Tool· 1

Takeaway· 2