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It was pretty good. It was... Yes, it was pretty good. Don't doubt your vibe. For not being his full-time gig, it was pretty good. Emoji Records. Welcome to Episode 2 of Adapting by Acquired. Hey, now you got it. Yeah, well, I rehearsed. Or for those keeping track at home, Season 6, Episode 5. We are continuing our series to bring you the stories of great companies and great leaders who are adapting to a world that's changing in real time. Today, we are covering the story behind the memo, red around the world. Sequoia Capital's Black Swan memo, amazingly published only 20 days ago as we record this. Man, feels like 20 lifetimes ago. I know. I know. Well, we are joined by the best person in the world to tell us about it. Long time Sequoia Partner, Rulaf Bohta. Today's episode is different than last week's episode with Canless. We are going much closer to Acquired's bread and butter of technology and venture capital. This conversation is particularly interesting, not just to hear the story behind the Black Swan memo, but also to get a real-time look at how Sequoia themselves are thinking about adapting during this time, along with their portfolio companies. Before we jump in, if you haven't already, we want to strongly encourage you to join the Acquired's Black community. I honestly think at this point, it's probably the best community on the internet for people focused on building and investing in great companies. We really mean that, and that's a testament to you all and the quality of people that listen to this show. It's been pretty awesome, especially over the last week or so, just seeing how we're all supporting each other in there and helping everybody get through this time. You can find the link on our website to get it in by you should definitely sign up. The other thing we want to tell you about is, as we announced on the last episode, we're adding something big to the limited program that we're really excited about. We're going to be hosting monthly calls on Zoom for all LPs, which we're calling, appropriately enough, LP calls. So when you sign up, we're big into branding here at Acquired. So when you sign up for the limited partner program, you get both all our LP episodes, which go deeper on nitty gritty company building topics and access to the monthly LP calls with both of us. You can sign up by clicking the link in the show notes or going to glow.fm slash acquired. Our presenting sponsor for this episode is not a sponsor, but another podcast that we love and want to recommend called the founders podcast. We have seen dozens of tweets that say something like, my favorite podcast is acquired and founders. So we knew there's a natural fit. We know the host of founders. Well, David Senra. Hi, David. Hey, Ben. Hey, David. Thank you for joining us. Thank you for having me. I like how they group us together and then they say it's like the best curriculum for founders and executives. And really, as we use your show for research a lot, I listened to your episode of the story of Akiyama Rita before we did our Sony episodes. This is incredible primer. You know, he's actually a good example of why people listen to founders into acquired because all of history's greatest entrepreneurs and investors, they had deep historical knowledge about the work that came before them. So like the founder of Sony, who did he influence? Steve Jobs talked about him over and over again if you do the research to him. But I think this is one of the reasons why people love both of our shows and there's such good compliments. And on acquired, we focus on company histories. You tell the histories of the individual people. You're the people version of acquired and where the company version of founders. Listeners, the other fun thing to note is David will hit a topic from a bunch of different angles. So I just listened to an episode on Edwin Land from a biography that David did. David, it was the third, fourth time you've done Polaroid. I've read five biographies of Edwin Land and I think I've made eight episodes of them because in my opinion, the greatest entrepreneur to ever do it, my favorite entrepreneur personally is Steve Jobs. And if you go back and listen to like a 20 year old Steve Jobs, he's talking about Edwin Land's my hero. So the reason I did that is because I want to find out like I have my heroes who were their heroes. And the beauty of this is the people may die, but the ideas never do. And so Edwin Land had passed away way before the apex of Apple, but Steve was still able to use those ideas. And now he's gone and we can use his ideas. And so I think what acquired is doing what the founder trying to do as well is find the best ideas in history and push them down to generations. Make sure they're not lost history. I love that. Well, listeners, go check out the founders podcast after this episode. You can search for it in any podcast player. Lots of companies that David covers that we have yet to dive into here on acquired. So for more indulgence on companies and founders, go check it out. And with that, David, we will dive into our interview with Rulof. We are super lucky to have Rulof with us today. Rulof has been a partner at Sequoia since 2003 and led early investments in some of the most important companies that we've covered on this show. Companies like Instagram, YouTube, and Square. He currently leads the firm's US business as one of Sequoia's three stewards, along with Doug Leoni and Neil Shen. And prior to joining Sequoia, Rulof was the CFO of PayPal, which is particularly relevant to our conversation today, having helped navigate them through the.com crash, their subsequent IPO, and ultimately their sale to eBay for one and a half billion dollars. Welcome Rulof. And thanks for joining us in these interesting times. Thank you. I wish in circumstances with different, but I'm glad to be here. Us too. We're glad to have you. Let's jump right into it. On March 5th, you guys did something that now seems obvious in hindsight, but definitely did not seem obvious on March 5th, which was. Yeah, I think March 5th, that was like two years ago at this point. It feels like there's that learning quality rate of that people have been saying about some decades, nothing happens, and some weeks decades happen. It's been about two decades. You guys released publicly, both simultaneously emailed all your portfolio CEOs and posted on Medium, what you call the Black Swan memo. I'm sure most of our listeners have read it probably multiple times at this point. I just want to point out, I want to highlight one kind of quote from it that again, probably everyone's read. But it's such a stark difference between what you guys said and what so many other investors and people were saying at the moment, you say, having weathered every business downturn for nearly 50 years, we've learned an important lesson. Nobody ever regrets making fast and decisive adjustments to changing circumstances. And downturns, revenue and cash levels always fall faster than expenses in some ways business, mirrors biology, as Darwin surmised, those who survive are not the strongest or the most intelligent, but the most adaptable to change. Can you walk us through as you were writing this and getting ready to hit publish? Like, what were you feeling internally? The sense of nervousness that the world wasn't really paying attention to the reality that we were facing. We have the benefit of being a global partnership, so we were seeing what was happening in China with our business and with our partners and what it was like to be under lockdown. We've been through many business cycles. It's a way of, you know, we're in around 48 years. We've been through so many of these cycles and we've seen this movie before. And our sense was that people hadn't quite realized what was about to happen. It was like watching an accident happen in slow motion. You can just see it and we felt a duty and obligation to do something about it. Well, let's have this stage for folks. This was six days before the NBA announcement came out. So it was sort of a week before the general American consciousness woke up and said, oh my god, this is a huge deal. Did you worry at all that you were jumping the gun and as a related question, I mean, Sequoia is such a force in our ecosystem. Did you think about the risk of gosh, do we do we incite something by releasing something like this? We do, which is why we do this very infrequently. The last time we did something comparable was at the end of 2008 with the RIST in Peace Good Times memo, which wasn't intended to be published. It was really intended just for our founders because we wanted them to understand what was happening. And it comes at a risk. I mean, even they, I heard from people back in 2008 that, you know, we were the reason the crash happened. Like as if we had that kind of power. And similarly, yeah, I heard people complain, you know, we're being alarmist and things like that, but we really felt a duty that, you know, maybe people are going to be uncomfortable with us saying these sort of things, but we have an obligation to tell people what we see coming around the corner. Some challenged me and said, well, what if it doesn't turn out to be that bad? And I said, if that's the case, I'd be so thankful. I'd be so thankful. And I will eat humble pie for having published this. There's so much more important for us to put the word of warning out. Often when you're in the trenches as a company, you know, you have a slightly different perspective on things, especially if you haven't been through previous cycles. And I remember when I was there at PayPal in, you know, I joined in March of 2000, the NASDAQ saw it. It's slide in April. And I remember being at a board meeting with Mike Meritz from Sequoia in June. And he told us he wanted us to focus on runway because the financing environment has changed forever. And I think honestly, for all of us is, you know, first timers, if you will, in the company, we didn't quite fathom that. We thought that, you know, what did we experience for the last two years would continue. And he really rung the bell and we paid attention. And that month, we really started to sharpen up pencils to make sure that we had enough runway to make it to the other side. I'm super curious. You've talked about this a bunch. And obviously as CFO, you were right there at the Elm doing this. What were the things you did? I mean, you were, I believe, the first technology company to go public after the crash, then had this wonderful exit. What were the actual things that you did to save the company and to stay on a growth trajectory even through all this carnage? First things, obviously, a team effort. I mean, I was one of many people of the company that rallied together. And I think that's one of the things that you see in this unfortunate humanitarian crisis. I mean, I think the thing that's different about this, by the way, is it's a health crisis in addition to an economic crisis at a global scale. And that makes it so different from any of these other incidents we've seen. You know, that's awful on many levels, but I do think it's very different from what we had back then. But we rallied as a team and we looked through the P&L. I remember literally going through line by line on every single thing on which we were spending money to figure out what was truly essential to helping us build a successful business on the expense side, the things that you can control. We tried to figure out, initially, to raise more money to extend our runway. And we got religion about a business model. I mean, up until I think June 10 or June 22,000, PayPal didn't charge for its service. And at that point, we realized if we wanted to keep going, we had to figure out a business model and make it a great business model. And that's exactly the kind of focus that we got because this external environment changed so dramatically. You know, constraints enable you to come up with creative new solutions. And so I think you're going to find an incredible array of entrepreneurs coming up with wonderful solutions in the midst of this terrible crisis. To go back for a sec to the Black Swan memo, can you talk a little bit about what it was over the preceding weeks before March 5th that you were seeing in China? And obviously through your unique perspective that kind of gave you confidence that, hey, this is a lot more serious than people are realizing in the US and elsewhere. I think we saw how a team in China immediately had to go into a full lockdown, just sort of a dramatic change at a national level with over a billion people and just not just in the province that was affected, but everywhere that they were taking it seriously. So clearly, the people at the front lines had seen that this was a virus unlike others that were spreading a lot faster and had higher mortality rate than a typical seasonal flu. So that just felt very, very different. And I think it was pretty obvious that by then there were cases showing up in the US, even though there was a travel ban at one point, it was just too porous. Most people could have come here from in China, they could have gone to other parts of the world and coming into the US. And so it was quite likely that there's a bigger problem today in the US than we realize. And this is the unfortunate thing about the absence of testing infrastructure right now in the country. Now, I have a friend in New York who had it for 11 days before he was confirmed positive last week. My brother in San Francisco, I think, has a conch-tested, he literally conch-tested because he's not in a high risk group. So I think we just had a sense that the problem is actually a lot bigger. There's the parable of the wheat or the rice in the chessboard, with the person wants to get compensated, one, two, four, etc. And it's obviously a great thing for people who study computer science, but to the power in becomes a very large number as in-grows. And things that grow exponentially, we just don't understand it. Something that looked trivial 12 days ago, but is doubling every six days, something looks dramatically different just two weeks later. This was at the cusp of happening in America. And so we felt this obligation, I guess, earlier to make sure that people paid attention and acted now. It's a great lead-in to something that David and I talk about a lot. And David, I like to share this with you, but I look up to you a lot in the way that you think about playing defense and playing offense and being very careful about when is a time for defense and when is a time for offense. Doing both at the same time, you should have to be careful what actions are for which thing. And rule off, I want to dive in on defense right now. You guys have been putting out a reasonable amount of content compared to sort of Sequoia of Old. And one of the pieces that you publish for entrepreneurs is this decision matrix. And I would sort of think about this as defense. How should entrepreneurs use that? And then I'm curious to ask you some questions about offense. So I want to give credit to one of our CFOs in the portfolio. It doesn't want to be singled out to name, but he developed this for a portfolio company where I happen to be on the board for Sequoia. And I thought it was an incredible structure. In that case, the company had sort of seven main scenarios with a couple of sub-synorias. And I just thought it's a wonderful framework to address the challenge you face because we don't know the state of the world. Or this is so much uncertainty right now, but I'll be actually going to reopen in three weeks, four weeks, ten weeks. Is it going to be a second wave? Are they going to be five waves? Is the world going to be in a week? We don't know. So I thought it was a wonderful way to think about what are the various scenarios that may play out? What are the strategies you could pursue? And what does it do for your resulting cash balance at some future date that is important? And your end is as good as any, I guess, at this point. Because companies need to survive. Cash is the most important thing companies have to focus on right now. Because if you don't survive, obviously there's no chance for you to build an enduring business. So that's the reason I thought it was a fabulous framework. And again, we felt we wanted to share it with as many people as possible. And we did actually on Friday, we had a Q&A session with over 100 portfolio companies. Several of our partners hosted this call. And we shared it with those companies. And we just felt then that we wanted to share it with everybody. Now to ask the question on offense, this time is incredibly challenging for a lot of people. And we should, in no way gloss over that. I'm sure it's challenging for you. It's challenging for me. That you can sort of squint and find ways to actually turn it into something positive and find perhaps a dislocation in a market or an opportunity that's emerged that was never a need from people before. And I just love to get your perspective on how can people be proactive and turn this into a positive? Well, there are a couple of companies obviously that benefit from us all having to work from home and things like that. So the product we're using Zoom is obviously benefiting their companies like Loom and Output Folio that are benefiting the delivery companies or an essential service in my mind to make sure that we get food and get delivery of basic necessities. There's a class of companies that are benefiting, you may not be one of those companies. So that doesn't really help you. The thing that I think really everybody can focus on in this time is product development. Keep on investing in your product. The ones that are marketing by definition are going to be challenged over the next few months because people are going to shift their consumption behavior face to face selling if you're an enterprise company is going to be hampered. Marketing channels may be are flooded by the things and it may seem insensitive candidly for you to pedal. Certain types of products right now, it's just not the right time. Hunker down and focus on product development. Build that truly differentiated product that if you can survive, gives you a huge advantage when you come out the other side. There's part of what happens here, and I'll use the analogy of our name-six sequer tree. Like forest fires have been a part of the landscape in the US for a long time and it'll often clear the brush. And the sequer trees that survive end up thriving disproportionately once the fire has cleared right because there's more sunlight and there's more space for those that survive. And so you've got to wait your time out and make sure that you can pounce with a truly differentiated product because the competitive landscape is probably going to be key. So I think that's a great opportunity for you after that. I think the other thing to do before that is to look for a community. So it's a lot of what we've been doing, trying to get our founders together, not only with the sort of weekly call that we're doing now, but getting founded to founder communities together. There's so much ingenuity and so much good advice and tips that they can share with each other and also just kind of spurts where they can share some of the suffering candidly that's happening right now. So lean into community, lean into your product. I know you guys have done some innovative things, creating spaces right now for portfolio companies. How are you doing that and how are you interacting with them and then with each other? Well, I think at an individual level, obviously board members are in frequent contact with the companies as we try to share best practices. In addition to the matrix which we shared publicly, there are a couple of other things that we've prepared for companies. For the unfortunate company that may need to go through a reduction in force, for example, we've actually prepared some best practices that we've seen so we can share people and just help on them for some of the challenges that lie ahead. We've created the Q&A with us as a group. So we get over 100 companies to get together with Sequoia partners and we have a few prepared remarks, things that we're seeing and we open it up for questions. We're arranging founder to founder sessions, no Sequoia person present where they can just industries that are relevant where they can share best practices. We're also doing that for CFOs. We think a lot of the CFOs across the portfolio are dealing with similar challenges. What do they do about potential rent abatement? What are they doing to renegotiate debt? What happened to that financing that we're supposed to close? Things like that where they can also get together and help each other. If anything, this was also accelerated our desire to build even more digital products around our community. We've prided ourselves in the sort of community things we do with activities like base camp and AMP and other programs we have. Obviously, those are halted right now. What can we do to recreate as much of that as possible online as something we're working on? Can we circle back real quick before we get off of playing offense for folio companies? I want to come back to your time at PayPal. It struck me that I didn't realize that PayPal didn't have a business model or at least a viable business model until after the crash. As I kind of think about the hierarchy of impacts of change you can have as a startup, you know, they're sort of like at the bottom is sales and marketing and then nothing is sales marketing. And then at the mid level is product. But actually, the highest level I always think is changing a business model. Now is kind of a really good opportunity to do that. How did you guys think about, well, you know, when there was the necessity of, okay, you need to make revenue now. But how did you figure out that business model so quickly during that time at PayPal? What is the money is the mother of invention? I don't think it was that difficult to figure out that as a payments company, there was so many precedents of charging transaction based fees. I think there was some other nuances where we figured out how to get bank account funding so that we had a much high gross margin. The traditional credit card processors did. So there's some other things we did. We also had to figure out solutions to online fraud, which took down many of our competitors and was a very expensive thing for us as well. We lost millions of dollars in 2000 to scalable online fraud. Part of what we talked about at the company was at the end of the day, if we can't keep the company alive because people are willing to pay for the service we provide, we don't really have a reason to exist. But we need to deliver enough value so that whatever we charge leaves enough of a gap of value capture to the customer, we're very happy to pay for the service we have. And I think many companies may face that type of a crucible moment over the next six months if they've been free services or if the business model hasn't really been refined properly. But it's clarifying at some level. Yeah, where you're really forced to show up in a way that says, hey, I am delivering enough value here to charge for it. What's the quote about? Is it a Warren Buffett quote? You know who has their shorts on when the tide goes out? Man, we're trading out. I think it's my key. Yeah, Howard Marks, actually. Is it? Okay. Well, I'll give you another one that we used actually this week in a partnership which is, um, com sees never made a good sailor. Yeah. And we've had a long period of com sees. We have and this is going to be a time where I think you're really going to see people the friendship themselves and how they deal with the crisis. You know, who steps up? Who provides leadership? Who reminds a company of the mission of the company? The purpose that they have beyond just, you know, delivering a product. Those are the sort of companies that I think can really excel in a time of crisis. Well, I want to move us along to a section here that we're doing and adapting called adapting. And really talk about Sequoia itself and how you're adapting. And I remember when we interviewed Doug, he spoke of the war room days of managing the 1999 fund, um, after the dot com crash. What does the Sequoia war room of March 2020 look like, especially as you literally can't be in a war room? No, virtual war room. You know, the other thing which are challenging is we have our, uh, by NLLP meeting next week. Just for context, it was originally supposed to be in India. And then in January, we started to worry, given what we were seeing in China. So we actually moved it in January from India to California because we thought that we're going to be issues in this early, uh, April late March timeframe. I mean, just concretely, we took action. And then obviously having it in California started to not look feasible. So we've moved it to a virtual LP meeting. So in the midst of preparing for a very important event for us, I mean, our, our customers and we want to do, we want to have a great show for them in some sense and provide candid feedback and reporting on our funds. At the same time, you know, we're running around like crazy looking after our portfolio companies. The most important thing we focused on over the last two weeks is our companies. You know, so queer as a business, we've been around almost five decades. We're not in a, in a task part, fortunately, but some of our companies really do face challenges. And so we've really oriented everything towards what is based for our companies. We've built a bunch of online tools. So we have resources where we can all look at things. We have daily standups, uh, using Zoom so that everybody can stay in touch. We understand what the partization is. We're using many more. And that's among the partnership within the partnership. Yes. So as a team, since we, you know, what do you do to make the effect of being on the office together so that we just stay in touch a little bit more frequently. And we've created these online resources. And part of the most important thing we've done is to do a, a very thorough analysis of the portfolio health. So literally company by company across every single company in the US, we've gone down to figure out, okay, at your end in December. What was the expected run by based on cash and burn then? What do we think it is now given the change to circumstances and which of the two, three thousand companies we really need to spend most of our attention? Some companies are early stage six people product development. I mean, in some sense, they're unaffected. They're just building the product and hope to launch next year. And then there are other companies that are really affected significantly. And so as a team, we try to figure out how do we rally around them and how do we bring resources to be able to help them navigate through this tricky period. And as you sort of frame that up around the portfolio companies, you know, it sounds obvious that of course you would spend time with your portfolio companies. What are the things that you're not doing as much of that you would normally be spending your, your days doing? And how has sort of this time forced you to change that? Seems like we do more of everything. It doesn't. Honestly, no less of that too. I mean, interviews are still going on. We're just doing them all as virtual interviews. I do think they're probably wanted to hire somewhere where you're going to wait to meet the person in person before you make a formal final hiring decision. But for us, we're onboarding people remotely. We did this on Monday. We had a person who joined who, you know, first virtual onboarding for us as our portfolio companies are doing. I was on a call earlier today with a company and they're onboarded 21 people on Monday, remotely. And you know, people are going to keep hiring. They're going to keep building products. So I think a lot of those things stay the same. We continue to make investments. We formally approved two new series A investments last week. And those meetings were virtual meetings. So business continues. Has something changed in what you look for in companies compared to a call it two, three months ago? And something's not, I mean, certainly not at the series A stage because I think the, you know, those companies, they're at such an early stage that product needs to be so differentiated and really solve the problem that would transcend the current market. And obviously if the US is shut down indefinitely, that's a different situation. But, you know, these companies all have a sound value proposition and once things are a little bit more normal, even if the economy goes through a recession, we believe in these businesses because they're really solving really important problems. And so we have confidence in them. We have asked people how they plan to respond to a changing circumstance, a little bit of a test on whether they're a number, are they flexible or they just toned off to the reality of the world we're in right now. So that clearly is a question we're asking that's different. And then we're also spending time thinking about what new categories may be unfaily favored, sort of post coronacopelips. Do you end up with digital health companies, online education? A bunch of things may change and are we forced into a behavior change through this environment where in now that sticks. I think it's a really interesting question. A lot of people are thinking about this. I think it's a really interesting thing to try to, you know, conjecture. That's the perfect transition to kind of the topic we wanted to wrap up with you on. I was thinking about it when you mentioned your LP meeting next week, which, man, I feel for you, I know how important those are having done them, attended them and everything. And it was interesting. Just yesterday, I attended one virtually and it was amazing that it was actually better. You know, these tend to be pretty dry affairs. This is a small example, but either through the LP meeting or more broadly, have you guys started to think about what kind of permanent changes to Sequoia might come out of this? I think we're going to be, we've already seen a trend where companies are becoming more distributed, partly because of the cost of living in the Bay Area is so high. And the cost of hiring engineers is just so high. We've already seen a trend where companies are willing to tolerate remote work by individuals or multiple remote development offices. I think that trend is going to gather steam. I think you're going to run this experiment that's actually measurable on how people perform in this kind of an environment. So I think that just objectively is going to change the debate because I think it's so easy. You know, as humans, we resist behavior change whenever we can and this is forcing behavior change. So I think tolerating businesses that are distributed, learning how to work effectively with distributed teams. I think we're likely to see people start companies in many more places. And again, that's a trend that it already started. You know, Silicon Valley doesn't have a monopoly on idea generation. And I think many more people will start companies elsewhere. So we probably need to be more willing to fly or if not fly given health issues to online assessments of companies. So I think those appear to mention you all are organized or at least have been to this point geographically for a company. And I think there can be a lot more of these like Zapier, right? Like we've had weight on the show. They have no office. How are you going to think about a company like that in the future is that a US investment is that a global investment? I think it needs to. Well, you know, honestly, we should be running to a couple of conflicts like this. But I don't actually think of them as conflicts. Our team in India is an investor in a fabulous company called FreshWorks. Most of FreshWorks customers are on the developed world, including the US. So my guess is the majority of the revenue comes from the US, but there was an investment out of our India office because that's where the company is based. And they have a presence in the US too, but we help them. We're one partnership globally. We've done some really clever things behind the scenes to make sure that we feel like a single partnership and how we share knowledge and share compensation and things like that in a way that makes it feel good. And I'd rather have more of those. I mean, that's a great problem to have, honestly. There's a lot of folks talking about the sheer amount of dry powder that has been committed to venture firms in this climate. So they're saying, you know, the funding won't slow down because, oh my gosh, there's just billions and billions of billions. It's been promised to venture firms. So therefore, deployment should continue at the exact same pace. How do you think about that? And it's probably too early to tell, but have you thought about should we slow deployment, should we change when we want to raise certain funds? Should we change the mix of initial capital deployment versus follow-ons? Does a climate affect something like that for you guys? So the two questions there, I think the one is whether the LP behavior and the other ones what's our behavior. And so the interesting thing in 2008, maybe, not because we had a crystal ball just because we felt things were a little frothy. Our investment pace had actually slowed down on the first half of 2008 before Lehman happened. And then we accelerated in 2009. So I don't know if you've ever done a driving course, but I went to one once on a Formula One racing track. And the thing that they taught me is you break as hard as you can while the car is going straight before you get to the corner. And then you have to figure out how to accelerate at the right point of the apex out of the corner so that you can sprint ahead. And this is exactly the analogy that we want to apply for our companies and for ourselves. We slowed down in 2019, not because we had some crystal ball again that this was going to happen, but we just, things didn't quite feel right. If anything, I want to accelerate out of this. I think there could be fabulous investment opportunities and great companies to be built. So that's what we plan to do. For our LP's, our clients are almost exclusively these endowments, foundations and nonprofits. And we're really proud of the great causes represented by our LP's. We actually got an email earlier this week that about 10 of our LPs, people like the Cleveland Clinic, Johns Hopkins University, the Welcome Trust, Stanford, MIT are all working on either better diagnostics, potential treatments or vaccines for coronavirus. So we love the fact that our clients are doing these things. So when we generate profits, it helps them do these sort of things. I think our clients are relatively well protected. But if you talk about the industry at large, I suspect some LPs are going to end up with cash flow issues, just like there are many other businesses that are going to end up with cash flow issues. And that may at the moment lower the amount of venture capital being deployed over the next year or two. But that's total speculation. I don't know. Well, LPs had already allocations to venture and private companies broadly had already gone up so much for LPs just with the bull run invaluations on the private markets and lack of liquidity over the last 10 years. Now with public markets dropping so much, you can get into a situation as an LP where you aim to have, say, 15% of your assets in private markets total. And now you have 40% of your assets in private markets. And that can be a scary position. Well, is that, and then LPs may also end up with cash flow issues on their own. Right? So part of what we saw in 2009, 2009 or some LPs have ongoing commitments, that's outflow commitments. If you're an endowment at a university, you're probably represent more than half the expenditure of the university. And it may be the donations dry up. Right? So philanthropy shrinks in an environment like this. And so they're even more dependent on the endowments being able to continue to pay for teachers and, you know, keeping the school hospital going and things like that. So the bunch of cash flow issues that may also then drive people to pull back from venture capital. But it's certainly to tell me, you know, I look at the generations every day in the stock market and like flippe coin, is it plus 10 minus 10 today? Like I have no idea. And so it's all hard to figure out, you know, where things last. As we're recording this, it's only been 20 days since you wrote the memo. And it got it feels like 20 years. Well, Rulof, I know this is adapting and not acquired, but we have one bonus question that, you know, we decided if we ever had you on the show after doing our deep dive on square and doing the square IPO. We had to ask you, you know, what was it like navigating the challenging square IPO and the months afterwards, sort of knowing what what a predictable and good business it was, but just seeing what happened in the public markets after IPO. This was like a key moment in acquired history. We, you know, we can look back and kind of to the pre-square IPO episode and the post-square IPO episode because it was just such a stark story to us of a company that was a great company that had just even in the bull market run that we were in when they went public was so misjudged. It was really difficult. And you know, in the run up to the IPO because you have this quiet period, we couldn't really respond. And I felt as often happens with these IPOs that, you know, people just keep on this negative vicious cycle of negative press. And so it was a really painful to deal with that. And then you see the IPO price at $9. And, you know, I was arguing the night before that we should price a little bit higher at least so we have more in the balance sheet and then to see the way that it popped in the first day. And it was still not a great outcome even at the close price of the first day. But I felt that we left so much money on the table. So the way to react in my mind was to rally the team and to talk about just, you know, we can't control our stock price. What we can control is our execution. And I think the management team did an incredible job of saying, look, it is what it is. We got through it. Let's hunker down and let's just build a great business. And they did that. And then what we did as an investor is we were patient. So we didn't distribute a single square share until four years after the IPO. Four years. And so that means that we distributed, you know, and we still haven't fully distributed by the way, because I have so much faith in this company. You're still on the board, correct? I'm still on the board. I love working with the team. I love working with Jack. I love the mission of the company around financial empowerment and the fact that we're able to do that now, not only for small businesses, but also for consumers with a square cash app. I think it's a fabulous company to be associated with from a mission point of view and actual financial results. And my partners and myself, we were just really patient. And so the fact that it was my $1.00 a share IPO didn't matter because we distributed shares when it got to 80. And so at the end of the day, we made a much better return for our limited partners by being patient. And I think the team also appreciated us as a really patient investor. It's great. Thank you for sharing. And that's a good note to end on with. This moment in time too, right? Like, you know, for great companies, they're going to survive. They're going to hunker down and now is not the time to liquidate your shares. Yeah, I think it's focusing on long term. So real problems. Yeah. Well, on that note, Rulof, where can our listeners get in touch with you with Sequoia? My first name, Rulof at Sequoiacap.com. Great. And are you on Twitter? Yes. I'd Rulof. I signed up in 2007. Nice. I've been a user for a long, long time. That's awesome. Thank you for joining us listeners. We hope you enjoyed this episode of adapting. Please send us feedback. Acquired FM at gmail.com or join our Slack. And we'd love to talk to you there. Rulof, thanks again. Thank you, Ben. All right.