How Vercel found extreme product-market fit by focusing on simplification | Guillermo Rauch (CEO)
First Round Capital
Channel
Interviewed Person
Guillermo Rauch
Description
Guillermo Rauch is the CEO of Vercel, a frontend-as-a-service product that was valued at $2.5b in 2021. Vercel serves customers like Uber, Notion and Zapier, and their React framework - Next.js - is used by over 500,000 developers and designers worldwide. Guillermo started his first company at age 11 in Buenos Aires and moved to San Francisco at age 18. In 2013, he sold his company Cloudup to Automattic (the company behind WordPress), and in 2015 he founded Vercel. — In today’s episode we discuss: • Guillermo’s fascinating path into tech • Learnings from building Cloudup and selling the company to Automattic (the company behind WordPress) • Vercel’s origin story and path to product market fit • How to make an open source business successful • Vercel’s unique philosophy on developer experience • Insights and predictions on the future of AI — Referenced: • Algolia: https://www.algolia.com/ • Apache Zookeeper: https://zookeeper.apache.org/ • Apache Kafka: https://kafka.apache.org/ • AWS: https://www.aws.training/ • C++: https://www.techtarget.com/searchdatamanagement/definition/C • Clerk: https://clerk-tech.com/ • Cloudup: https://cloudup.com/ • Commerce Cloud: https://www.salesforce.com/products/commerce/ • Contentful: https://www.contentful.com/ • Debian: https://www.debian.org/ • Elon Musk’s philosophy of “user input equals error": https://www.placeos.com/blog/how-tesla-tackles-ux-design • Fintool: https://www.fintool.com/ • Figma: https://www.figma.com/ • Front-end vs back-end engineering: https://www.computerscience.org/bootcamps/resources/frontend-vs-backend/ • Front-end Cloud: https://vercel.com/resources/the-frontend-cloud-advantage • GitLab: https://about.gitlab.com/ • “Headless” Technology: https://vuestorefront.io/blog/headless-technology • “Headless” Commerce: https://www.shopify.com/ph/enterprise/headless-commerce • IRC: https://en.wikipedia.org/wiki/Internet_Relay_Chat • KDE: https://kde.org/ • Linux: https://en.wikipedia.org/wiki/Linux • Mozilla: https://www.mozilla.org • MooTools (UI library): https://mootools.net/ • Next.js: https://nextjs.org/ • React Native: https://reactnative.dev/ • Red Hat: https://www.redhat.com/ • Redpanda: https://redpanda.com/ • Resend: https://resend.com/ • Rust: https://www.rust-lang.org/ • Salesforce: https://www.salesforce.com • Servo: https://servo.org/ • Shopify: https://www.shopify.com/ • Socket.io: https://socket.io/ • Symphony: https://symphony.com/ • Tesla/Elon’s original “Master Plan”: https://www.tesla.com/blog/secret-tesla-motors-master-plan-just-between-you-and-me • Trilio: https://trilio.io/ • Twilio: https://www.twilio.com • Vercel: https://vercel.com/ • V0.dev: https://v0.dev/ • X11 explained: https://goteleport.com/blog/x11-forwarding/ — Where to find Guillermo: • Twitter/x: https://twitter.com/rauchg • LinkedIn: https://www.linkedin.com/in/rauchg/ • Personal website: https://rauchg.com/ — Where to find Todd Jackson: • Twitter: https://twitter.com/tjack • LinkedIn: https://www.linkedin.com/in/toddj0 — Where to find First Round Capital: • Website: https://firstround.com/ • First Round Review: https://review.firstround.com/ • Twitter: https://twitter.com/firstround • Youtube: https://www.youtube.com/@FirstRoundCapital • This podcast on all platforms: https://review.firstround.com/podcast — Timestamps: [00:02:35] Becoming an “internet celebrity” at age 11 [00:08:30] Guillermo's first company: Cloudup [00:11:09] Biggest learnings from Cloudup and WordPress [00:15:06] The insights behind starting Vercel [00:17:11] Sources of validation for Vercel [00:20:29] How Vercel formed its V1 product [00:23:25] Navigating the early reactions from competitors and users [00:25:58] The paradox of developers and how it impacted Next.js [00:31:20] Advice on finding product market fit [00:34:48] The forces behind a trend towards "Front-end Cloud” [00:38:35] Why people now pay so much attention to the front-end [00:40:06] How to make an open source business successful [00:44:54] Insights on product positioning and category creation [00:48:52] Vercel's journey through becoming multi-product [00:51:44] Guillermo's take on the future of AI [00:53:43] Heuristics for building better product experiences [00:55:49] AI insights from Vercel’s customers [00:57:37] How AI might change engineering in the next 10-20 years [01:02:43] Guillermo's favorite advice [01:05:45] Guillermo's advice to himself of 10 years ago
Transcript
it felt like it became a little bit of an overnight success because it had a lot of attention and a lot of adoption since basically day one but it hadn't seen all this development before I had seen all this internal battle and pressure testing I had been thinking about the principles that the framework would live up to since like two years prior or even more but when things like fall into place you do see fast growth welcome to indepth a show that surfaces tactical advice Founders and
startup leaders need to grow their teams companies and themselves I'm Brett Burson a partner at first round and we're a venture capital firm that helps startups like notion Roblox Uber and square tackle company building firsts on the in-depth podcast we share weekly conversations with startup leaders that skip the talking points and go deeper into not just what to do but how to do it learn more And subscribe today at
firstr round.com hi everyone welcome to in-depth I'm Todd Jackson and I'm a partner here at first round I'm back guest hosting the latest episode in our series that explores Founders different paths to product Market fit in this episode I'm excited to be joined by GMO Rouch the founder and CEO of versell versell is a front-end cloud service that gives developers the Frameworks workflows and infrastructure to build a faster more personalized web it's also the company behind the very popular react framework nextjs which gives
developers the building blocks they need to build their web apps while also providing additional structure and features to help them optimize forell most recently raised $150 million series D fundraising in November 2021 and was last valued at $2.5 billion I think versell is a particularly valuable case study for Founders because it reached what we call here at first round extreme product Market fit very quickly this is the highest level of product Market fit Founders can achieve and to get there a product has to reach a state of profound
widespread customer love and demand while also being delivered through a scalable profitable go to market motion and that's exactly what GMO has done with versell and nextjs in our conversation today GMO reveals the signals he picked up on that told him he was onto extreme product Market fit he also shares a ton of useful tactics and learnings for Founders on everything from Building open source to how Engineers should start thinking of their roles and what he would have done differently if he had to start building from scratch and now onto my
conversation with GMO so GMO welcome to the show hey thanks for having me excited to be here let's go all the way back to your earliest days as a programmer how did you get your started and what Drew you towards web development yeah so I grew up in a suburb outside of Buenos Iris in Argentina and not a ton of people had computers at the time especially my neighborhood but my dad brought a computer home and the thing that he challenged us to do me and my brother was what can we do with it how can we hack it how can we install software how can we do more with it how we can how
can we experiment with it get this sort of very scientific experimental mindset about it and uh yeah I taught myself how to code growing up in a pretty poor area of Argentina one of the things for me that was really a key enabler of my career was can I make money from the things that I do can I Can I code and and provide services on the internet and things like that so I started my first business was was 11 years old I ended up
dropping out High School found my way to the Bay area where I started a company that I L later sold and yeah so it's been a it's been a a wild Journey from from the early days but really the enablers for me were open source and learning to code and uh teaching myself how to code and teaching myself English did you get kind of into the open source community in those early days yeah so one of the key things was at the time I'm 11 years old in Argentina there
Video Details
- Duration
- 1:07:01
- Published
- November 2, 2023
- Channel
- First Round Capital
- Language
- ENGLISH
- Views
- 787
- Likes
- 26
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