Some of you should skip this post. It falls into the ‘VC reminiscing about time with a startup after a successful outcome was announced,’ specifically software quality startup Graphite being acquired by code generation startup Cursor. Don’t get me wrong – it’s definitely better written and less aggrandizing than the most tradition versions (you’re not going to hear how ‘we’ built this company together), but still, it’s in this category of essays. I just don’t want anyone to be surprised – like when there’s a cute guinea pig on IG and you forget for a minute that they’re really just rats with a blowout.
With that warning done, yes, we led the seed round for Graphite in early 2020. I met Tomas first via a mutual, and then all five of us (me, Satya and the three Graphite cofounders) all did some quick conversations in various combinations. Satya’s feedback to me was memorable – something along the lines of ‘please get them a termsheet before other people realize how smart they are.’ And we did. It was a wonderful almost six years together and I know the relationships are going to outlast the transaction. I learned a ton from them about building in the developer ecosystem and from my fellow Board members, Peter Levine at a16z and Christine Esserman at Accel. While there were lots of microlessons, three particular memories are most personally indelible and I’d say if any one of these hadn’t happened the company would not have become what it did.
Took the Punches and Iterated to Durable PMF
Graphite started out as Screenplay. And while ‘code quality’ was always a true north mission statement for them – the reason the company was founded – it took some reps to find the best product manifestation of this goal. These weren’t pivots, but they did require first principles thinking, some intuition, and the confidence to leave something good behind in the search for great. In particular, before what we know today as Graphite was launched they had a mobile QA and release management tool deployed with customers. Given the frothy funding market at the time and the quality of this team they absolutely could have ‘forced’ this version of the company to a Series A. That is, an adequate set of performance curves, a bigger story, and pedigreed cofounders would be enough for a next funding round, and then with that capital they could hopefully figure it out from there. But Greg, Merrill and Tomas knew this wasn’t the way the best version of Graphite was going to be constructed. So they shut down that effort and repurposed some of the code – and a lot of the scars – into a new direction.
As mentioned earlier, going into the seed funding we had ZERO questions about the cofounders intelligence, ceiling, or relationship with one another. We did spend time – with them directly and via backchannels – to see if they could take a punch. If their first idea didn’t work would they be so shell-shocked as to run back to a BigCompany with their tails between their legs? Would the threat of failure be motivating or send them into denial? Would they have enough of a framework or guts to look at something as say ‘this can be ok, but we can do better?’ They did.
We still stress that seed is not a funding round, but a phase. And that most importantly it’s a time for experimentation and learning, not just brute-forcing an up and to the right curve. Or even worse, mindlessly doing what you put in a pitch deck just because that’s what you thought a year ago. The combination of bigger rounds and new/nervous VCs often asks founders to speedrun this process, but the best companies operate at the intersection of urgency and patience. Graphite threaded this needle.
Started During COVID and Back to IRL Quickly
Our conversations with Graphite started right before COVID 2020 lockdowns. It was a very weird time. I had at least met Tomas IRL but otherwise things became Zoom relationships quite quickly. As three close friends the cofounders were able to spend time together in NYC and began to assemble a small team virtually but not remotely, but still there was eagerness to get back to IRL ASAP. And they did as soon as it was advisable.
During this period I got to meet – mostly over Zoom, or in person outdoors – about the first ~20 hires they made. Often as part of the ‘close’ process once an offer had been made but sometimes earlier. It felt really wonderful to be included in this manner – the Graphite team appreciated the help (it was at their request) but more importantly it let me get a feel for the company as it started to grow. So many other startups at that time were sort of black boxes. Who knew where people were with their fake zoom backgrounds? Were people really committed to the cause or just working a few hours a day while trading NFTs and ICOs? This wasn’t the case with Graphite. Getting back IRL was about knitting a culture early and building the trust to do the aforementioned iteration. Put together everyone’s ideas and opinions together.
Were there some candidates who decided to not interview at Graphite because they preferred a remote lifestyle? Sure. But there were equal numbers who actually were leaving their jobs because their current employer was staying URL first. Remember, this was a young tech-focused startup in NYC – working from home with your two roommates and a small apartment is not glamorous. Having the social and physical separation to walk, bike or take the subway a few stops to an office was actually a feature, not a bug, for many. Graphite stayed true to who they wanted to be and ripped off the ‘what should we do’ bandaid early. It paid off – I don’t believe they would have been nearly as successful if they had stayed remote.
Three Founders Went the Distance Together
Point blank: By Year Six it’s unusual to see three technical cofounders all remain vital to the company. In my experience one of two situations tend to occur – they realize the CEO isn’t scaling and try to make that change or the two non-CEO cofounders overlap too much in engineering/don’t scale as leaders. There are versions of this which are polite and productive and versions of this which are toxic and disruptive. But it happens a lot. Obviously it didn’t here. But why?
Merrill wanted to be a great CEO not just a great cofounder. From early on he had the self-awareness that this would take work. And that the role would sometimes put him in disagreement with his cofounders on strategic decisions. He simultaneously embraced the responsibility while also prioritizing the effort to ensure the three of them were always communicating well, trusting each other, and putting Graphite ahead of any one of their feelings or ego.
Greg and Tomas were two sides of the same coin. They both cared deeply about Graphite being a place where engineers could make a difference. To oversimplify, Greg thought about this from a collective and structural perspective (what does the Engineering Org look like, what’s appropriate documentation and processes for our scale and culture, when do we need Engineering Management) and Tomas biased towards the individual (how could any one engineering hire make a difference, how could he look a potential team member in the eyes and sincerely say Graphite would be somewhere that they could have a great idea, build it, and ship it without five levels of approvals and a chilling effect of low risk tolerance), This is of course an abstraction – but they scaled beautifully. Tomas could work on experiments, Growth projects, lead Product within the technical and cross-functional org, while Greg had a natural role as CTO.
Of course I lived on the cap table, not the org chart, so my observations here are incomplete and reflect an outsider’s perspective, but I have such tremendous respect and admiration, not just for what they built, but how they built it. And that’s what we strive for at Homebrew. The intersection of joyful work with great teams and financial outcomes which make the work possible ongoing.
Onward!!!
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