M&A, competition, pricing, and investing | Julia Schottenstein (dbt Labs)
Lenny's Podcast: Product | Growth | Career
Lenny Rachitsky
5.0 • 1.5K Ratings
🗓️ 13 July 2023
⏱️ 61 minutes
🧾️ Download transcript
Summary
Brought to you by Vanta—Automate compliance. Simplify security | Superhuman—The fastest email experience ever made | AssemblyAI—Production-ready AI models to transcribe and understand speech
—
Julia Schottenstein is a product lead at dbt Labs, a data transformation company, and an active angel investor in data and infrastructure startups. She first got excited about dbt in 2019 when she was a VC at NEA and decided to make the leap from investor to operator by joining dbt Labs. She also co-hosts the dbt Labs Analytics Engineering Podcast, a show about data trends that impact analytics engineers’ work. In today’s episode, we discuss:
• Advice for founders hoping to improve their M&A outcome
• How to strategically think about competition
• How to determine your paid features and have willingness-to-pay conversations
• Why Julia lives by “worse is better” and “tech debt is a champagne problem”
• Lessons from dbt Labs
• What PMs can learn from investors
—
Find the full transcript at: https://www.lennyspodcast.com/ma-competition-pricing-and-investing-julia-schottenstein-dbt-labs/#transcript
—
Where to find Julia Schottenstein:
• Twitter: https://twitter.com/j_schottenstein
• LinkedIn: https://www.linkedin.com/in/julia-schottenstein-25424318/
• Podcast: https://open.spotify.com/show/4BKMMeVXk4jJnAQSqGSJvE
—
Where to find Lenny:
• Newsletter: https://www.lennysnewsletter.com
• Twitter: https://twitter.com/lennysan
• LinkedIn: https://www.linkedin.com/in/lennyrachitsky/
—
In this episode, we cover:
(00:00) Julia’s background
(04:15) How Julia went from VC to working in product at dbt Labs
(08:24) Four things Julia uses to evaluate a company’s potential
(11:10) How to identify whether or not you have product-market fit
(12:05) Distribution strategies
(13:11) M&A strategies
(15:54) Lessons from the Transform acquisition
(18:01) Competitive values at dbt
(20:25) Keys to dbt’s success
(26:35) An offsite exercise Julia used to help her team internalize upcoming changes
(29:32) Determining what features are included in open source
(31:56) Pricing and willingness to pay
(33:34) Lessons from dbt Labs’s first pricing change
(36:33) Whether or not to be public about selling your startup
(40:08) How to utilize connections during acquisitions
(44:57) How to communicate selling your company
(46:33) M&A market forecast
(47:28) Values at dbt Labs
(50:14) Lessons from working with strongly opinionated users
(52:02) The importance of shipping, learning, and iterating
(54:08) How VC skills translate into product
(57:03) Lightning round
—
Referenced:
• dbt Labs: https://www.getdbt.com/
• Tristan Handy on LinkedIn: https://www.linkedin.com/in/tristanhandy/
• dbt Labs acquires Transform to enhance Semantic Layer tool: https://www.techtarget.com/searchbusinessanalytics/news/365530993/DBT-Labs-acquires-Transform-to-enhance-Semantic-Layer-tool
• Snowflake: https://www.snowflake.com/en/
• Gödel, Escher, Bach: An Eternal Golden Braid: https://www.amazon.com/G%C3%B6del-Escher-Bach-Eternal-Golden/dp/0465026567
• Red strings training clip from Ted Lasso: https://www.youtube.com/watch?v=aVe3Iwy10MA
• Monetizing Innovation: https://www.amazon.com/Monetizing-Innovation-Companies-Design-Product/dp/1119240867
• Madhavan Ramanujam on Lenny’s Podcast: https://www.lennysnewsletter.com/p/the-art-and-science-of-pricing-madhavan#details
• Pricing survey: https://www.qualtrics.com/marketplace/vanwesterndorp-pricing-sensitivity-study/
• Hunter Walk’s blog post about publicly selling your startup: https://hunterwalk.com/2023/05/13/the-acquihire-market-for-early-stage-startups-is-ice-cold-one-better-strategy-announce-youre-for-sale/
• Range: Why Generalists Triumph in a Specialized World: https://www.amazon.com/Range-Generalists-Triumph-Specialized-World/dp/0735214506/
• The Snowball: Warren Buffett and the Business of Life: https://www.amazon.com/Snowball-Warren-Buffett-Business-Life/dp/0553384619/r
• Sam Walton: Made in America: https://www.amazon.com/Sam-Walton-Made-America/dp/0553562835
• Succession on HBO: https://www.hbo.com/succession
• In Depth podcast: https://review.firstround.com/podcast
• dbt community Slack: https://www.getdbt.com/community/join-the-community/
—
Production and marketing by https://penname.co/. For inquiries about sponsoring the podcast, email podcast@lennyrachitsky.com.
—
Lenny may be an investor in the companies discussed.
Get full access to Lenny's Newsletter at www.lennysnewsletter.com/subscribe
Transcript
Click on a timestamp to play from that location
| 0:00.0 | M&A is always about creating plan B's. |
| 0:03.2 | And the way I would think about it is for any one company, |
| 0:06.3 | there's only ever two to three buyers |
| 0:08.4 | that find what you're building to be extremely strategic. |
| 0:12.1 | And the strategy that I would do |
| 0:14.8 | and how do you get noticed is I would figure out |
| 0:18.4 | the area that you bring a competitive advantage |
| 0:21.6 | and I would inflict pain on that potential buyer. |
| 0:25.6 | Make it impossible for them to not notice you because that's when they're going to have their |
| 0:30.2 | ears perk up and say, well, what's going on with this company? |
| 0:33.4 | The really important piece here is you want to do that in a way that's still friendly and |
| 0:37.8 | open. |
| 0:38.8 | I see a lot of founders get this wrong, and they prematurely will shut down a conversation or they won't talk to an incumbent or a potential future buyer because they take too competitive of a stance. |
| 0:49.0 | But that's a mistake because M&A is all about creating plan B's and you don't want to shut that door down prematurely |
| 0:55.6 | because you don't know if you can really go the distance and be an independent company, |
| 0:59.7 | so you want to have optionality. Welcome to Lenny's podcast where I interview world-class product leaders and growth experts |
| 1:09.0 | to learn from their hard-won experiences building and growing today's most successful products. |
| 1:13.6 | Today my guest is Julia Schottenstein. |
| 1:16.0 | Julia is a product leader at DBT Labs where she leads the DBT Cloud product. |
| 1:21.2 | She's also the co-host of the DBT Labs Podcast, a show about data trends |
| 1:27.9 | that impact analytics engineers work. |
| 1:30.4 | As you'll hear in this episode, Julie actually led the acquisition of a startup that I'm an investor in called Transform from the side of DBT Labs. |
... |
Please login to see the full transcript.
Disclaimer: The podcast and artwork embedded on this page are from Lenny Rachitsky, and are the property of its owner and not affiliated with or endorsed by Tapesearch.
Generated transcripts are the property of Lenny Rachitsky and are distributed freely under the Fair Use doctrine. Transcripts generated by Tapesearch are not guaranteed to be accurate.
Copyright © Tapesearch 2026.