August 4, 2016 – Rehan Jalil came to the US to attend graduate school and then took a job at Sun Microsystems, accidentally ending up in Silicon Valley that would be the base for the rest of his career. Recognizing that he wanted to make a positive impact on the world, he started his entrepreneurial journey by founding WiChorus, which focused on enabling 4G technologies. After it was acquired by Tellabs, Jalil went on to look for new problems to solve. Elastica was formed to innovate cloud application security. It was acquired by Blue Coat in 2015, which recently was purchased by Symantec.
In this interview, Jalil emphasizes passion and perseverance in building a company. He relates the story of how, after raising Series A funding for Elastica, a large customer told him that they would not buy what they were building. This caused Jalil to pause the company’s plans while he reassessed the idea and tested it against what he felt in his gut. Out of that pause, Jalil grew strong convictions about his team, about the problem space, and about how to design a better product.
Jalil acknowledges the struggle and the key learnings that came out of this experience.
“Struggle is, to me, actually trying, stretching your limits and doing things that you are out of your comfort zone. And then not always you can persevere through some struggles, but if you do, that makes you a lot better. In fact, great things come from struggle.” Jalil said.
The full transcript is below.
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Rehan on entrepreneurship:
You have to be passionate about the things that you really want to do because entrepreneurship or building something new is not going to be a straight line. There is no Google Maps of going from starting a company to making it successful. You will be connecting the dots.
Rehan on culture:
Culture is the implicit habits that the people inside the company have formed. And if they’re not put together properly, it could be a big challenge. If the habits or the culture of a company is good, just like individual habits it can keep us away from bad stuff. A good culture can keep a company from bad things happening.
Rehan on building a lasting company:
You have to be super passionate about it. Whether you’re doing sports or whether it is building a company, or whether it’s doing a project, the passion is super important. But the passion cannot be short-term. It has to be long-term, which is going to sustain all the bumps that you’re going to see. And that’s perseverance.
Rehan on struggle:
When I was in elementary school, my father, in his beautiful handwriting, once gave me a nice note saying, “May you always struggle.” And oh man, I have struggled since then. And I think what he really meant, may you always try. Struggle is, to me, actually trying, stretching your limits and doing things that you are out of your comfort zone.
Rehan on current climate for startups:
Economic cycles go up and down, so do funding environments. Certainly, you do not want to be, timing-wise, on the bad side of things that you can get stuck with it. One thing is for sure that when there are go-go days of easy money, it actually is really bad for companies because many companies can develop habits which are not very disciplined. And those habits are not easy to change when the go-go days are gone.
Navin: Welcome back to Chat with Champions. I have the pleasure of hosting Rehan Jalil, a serial entrepreneur, with me today. Most recently, Rehan was founder and CEO of Elastica, which was acquired by Blue Coat, and was subsequently acquired by Symantec. Prior to that, he was founder and CEO of WiChorus, which was acquired by Tellabs. I’ve been fortunate enough to be have been a venture investor in both his companies. Rehan, welcome to the show.
Rehan: Navin, thank you so much for hosting for the show.
Navin: Let’s start with the story of your entrepreneurial journey.
Rehan: I came to the U.S. and went to graduate school at Purdue. Accidentally, I ended up in Silicon Valley. I went to Sun Microsystems, not by design but just because that was the option available. What I realized was that I wanted to take broader responsibility in roles and do things that would have a bigger impact directly on the lives of people. I joined a company called Aperto Networks which was trying to bring broadband to the underdeveloped countries, and I thought that would be very impactful. I was there for some time and the company did some really good things. I became the chief architect on the WiMAX site for the company.
Then it felt like there were some new things I wanted to do, which was more about taking the same broadband wireless, but for mobile, and combining the router technologies, high speed, to the mobile wireless. So I started WiChorus, which did some pretty interesting things on enabling 4G technologies, and it was deployed widely in U.S. and around the world. The company was acquired by Tellabs.
I didn’t want to stop there. So I looked at some new problems. Elastica was formed with the ambition of making the use of cloud applications much more secure and safe. As the story goes, Elastica innovated how the cloud application should be made secure. Recently, it was acquired by Blue Coat and, as you mentioned, Blue Coat was acquired by Symantec.
Navin: Got it. So my belief is that building companies is a marathon. It’s not a sprint and one goes through a lot of ups and downs. So any key learnings in your journey of what worked well? What were some of the key learnings? What didn’t work well? And how does it make you a better entrepreneur today?
Rehan: I think one of the key learnings is that you have to be passionate about the things that you really want to do because entrepreneurship or building something new is not going to be a straight line. There is no Google Maps of going from starting a company to making it successful. You will be connecting the dots. Along with the way, it’s guaranteed you’re going to face challenges. So you have to have enough passion and perseverance, not just yourself but the team that you have built around you. Especially the early team members that you build around yourself, they must also persevere.
The culture that you build inside your company, these are the organizational habits, just like individual habits. If those are wrong, you would not be able to scale the company. If you’re not intellectually honest in picking the problem statement that you’re trying to solve and don’t steer the company in the right direction, that’s going to create its issues. There are a number of things that have to go right and only a few wrong things can put you on a path of failure. So a lot of diligence and a lot of luck is needed.
Navin: You mentioned about teams and my strong belief is that in the end, it’s all about people and companies. That’s who we back because people make products. Products don’t make people. So what do you look for in people when you hire them? Is there something you’ve learned over the years that you can just tell in meeting people, for like five minutes, twenty minutes, thirty minutes?
Rehan: Essentially, it’s their passion and ability to persevere. Those traits have to be combined together. Intellectual honesty for those people have to be there. They have to match the culture of the company implicitly or explicitly that you have put out there. And they should have the ability to collaborate with others. Now, these are very high-level things. The question is how do you assess them?
For instance, if somebody is passionate, we would look for people who had maker-style hobbies. There were instances where we saw people who had maker-style hobbies and there were really hard things they’re doing in their personal lives. We literally had them join the company on the same day, giving them offers. Sometimes, you give very hard problems to people and let them take it home and observe how they came back with the solutions and when they came back with the solutions. Some people came back late night with a solution and it may not be right but they were just trying.
Navin: Got it.
Rehan: So a lot of early indicators, you have to actually have there. And of course, we made our share of mistakes along the way.
Navin: Yeah. Which we’ll get back to, right? One can’t learn unless you make mistakes. So you talked about culture and managing people. How big is the team you’re managing currently, and how big did Elastica get to at the end in number of people?
Rehan: Elastica grew very fast. We grew from a few dozen people to close to 250 people in a very short order, which could fracture the culture that you’re trying to put together. And that’s the challenge. Often, people think that the culture is just the perks that are around it. But actually, that’s not the case. It is the implicit habits that the people inside the company have formed, and if they’re not put together properly, it could be a big challenge. If the habits or the culture of a company is good, just like individual habits, it can keep us away from bad stuff. A good culture can keep a company from bad things happening.
The way to maintain the culture for us has been that when we bring in people, we are very selective, and actually look for cultural fit. Also, when you bring in people, make sure that you on-ramp them in a certain way, whether it’s written information or how they can be involved with the team. And if some people who are bringing in things that you do not want, require them to comply with the culture. And sometimes, you just have to make hard decisions that they may not be the right fit for the company.
Navin: Got it. And I often think a lot about grit which I believe is important in building a lasting company. So what do you look for and how do you look at grit, whether it’s in people, whether it’s in you, or just the way a company goes about?
Rehan: I think you do anything hard, you have to be super passionate about it. Whether you’re doing sports, whether it’s basketball, or whether it is building a company, or whether it’s doing a project, the passion is super important. But the passion cannot be short-term. It has to be long-term, which is going to sustain all the bumps that you’re going to see. And that’s perseverance. To combine these two things is essential, especially for early team members, that are required. And that’s essentially what you’re asking. So not only that it is needed in yourself as an entrepreneur, all the early team members — it is required that they actually have that or you’re not going to be able to accomplish anything.
In terms of finding that whether they have grit or not, you have to look people in terms of what they have done before, how they have done those things before. Look a little bit deeper into their personal hobbies and habits, not just the skill that they’re bringing to the table, and make that basic judgment call based on that. This is essential that you have people who can go along with you for a long haul.
Navin: Got it. Let’s switch gears; you have been successful not once, but many times. Things always don’t go right in one’s life journey. So can you talk about any learning you’ve had from a difficult experience or any of your struggle over the years?
Rehan: Yes. Struggle is an interesting word. The reason it’s interesting for me, when I was in elementary school, my father, in his beautiful handwriting, once gave me a nice note saying, “May you always struggle.” And oh man, I have struggled since then. And I think what he really meant, may you always try. Struggle is, to me, actually trying, stretching your limits and doing things that are out of your comfort zone. And then not always you can persevere through some struggles, but if you do, that makes you a lot better. In fact, great things come from struggle.
For me, in terms of struggle, with Elastica, there are many, many examples I can tell you. And I can tell you a very first example which you’re familiar with. I was obsessed in 2012 to actually make cloud application security secure. Soon after raising Series A, I talked to some very large customers, and they told me, “You must be nuts. We’re never going to buy what you’re trying to do.”
So now, it was my gut against a large customer telling me that I’m nuts, which means I had to really go back and be intellectually honest, really look at it. So I hit the pause button on the company. And that was very difficult because we just convinced the entire team and the investors, that this is the best thing to do. Then come back within weeks and say, “Sorry,” hitting pause button for many months. Extremely difficult.
Navin: I remember.
Rehan: What that did to us is not only did we lose time, we lost people. But it gave us a very strong conviction and learnings. And there are three key learnings from out of it. We learned which people are going to go through thick and thin very early on. And I, from the core of my heart, I valued those people over time.
Second thing I learned was security, because I had to go deeper into it. Security was actually a hodgepodge of many things glued together, with very clunky ways of actually identifying the issues, in terms of on-premise security. What it showed was an opportunity for design, not just solving a security problem but how you can actually make it super simple. And Elastica stood out for it and got known for it in the industry. That was a clear opportunity, because then when we go to the cloud you can do a more comprehensive design job there.
Third thing that I realized was instead of doing a feature, there’s an opportunity to build an entire stack of security for cloud because you don’t have to put a hodgepodge of things together. It could be one platform. And that diligence of a few months gave us not just the strong conviction but also the guidance on how the product should look like if we succeeded. It made us better. So in that case, of course, we persevered and we came out much stronger. But of course, we took our injuries and wounds along the way.
Navin: Yeah, I know. I remember all those discussions at night, in the morning, and the walks we had. And I’m glad, at the end, we stuck to our gut, primarily your gut. So let’s switch gears. What are your thoughts on the current climate for entrepreneurship? We have been through an up cycle, now we’re in a down cycle. How do you feel about it? Because I think when we funded you at Elastica it was 2012. We were still getting out of the recession. And then we saw the go-go years of 2014 and until mid-2015, and then things started correcting. So what’s your view on the current climate for entrepreneurship and startups?
Rehan: I think there’s a fundamental need of building new things and this is ongoing stuff. Economic cycles go up and down, so do funding environments. Certainly, you do not want to be, timing-wise, on the bad side of things that you can get stuck with. One thing is for sure that when there are go-go days of easy money, it actually is really bad for companies because many companies can develop habits which are not well disciplined. And those habits are not easy to change when the go-go days are gone. It’s not very easy to just flick a button and say, “Sorry. We’re going to do things differently now.” And it actually fractures the company.
Most good companies are built in bad times because there are fewer companies out there, only the selective ones are getting funded, and you have a better pool of employees that you can attract. In the go-go days everything flips on its head. So I think corrections are sometimes good. You just don’t want to be stuck on the bad side of the correction. And I think even now, it is an amazing time in our lives. Look at how many new innovations are coming, whether it’s on the cloud, whether it is with artificial intelligence, whether it is self-driving everything, not just the cars. All those ideas actually ask for new innovations and new things that can be brought to the table.
Navin: So having built two companies and now running a big division at Symantec, is there any single guiding principle or any key pieces of advice you have for entrepreneurs who are going to be listening to this podcast?
Rehan: Yeah. I think, life is short so living every day by itself and thinking that maybe you’re very close to the last day helps you prioritize things very well and it gives you balance. Also, in context, every day, the things that we benefit from, like as simple as turning a tap on and getting clean water is happening because somebody innovated some time to get the water to us.
So if you flip a switch and turn on the light, it’s generations of people who have innovated for us to actually enable that. We’re really benefiting from the makers of generations. The question for entrepreneurs, especially in Silicon Valley, which I asked myself a lot, is what will your contribution be to the rest of the world, while you’re here? It’s a very short lease of life, what is your contribution going to be. Find your passion, something you can be really good at, and then build something which can be beneficial to the lives of a lot of people. Not only is it going to make the world a better place but it’s going to be very gratifying and successful for yourself. That would be my advice to the makers out there.
Navin: That’s great. I know you’re really busy so I want to thank you, and appreciate the time you have spent with us today. Thank you for being here, Rehan.
Rehan: Thank you so much, Navin. It’s always good to talk to you.