Billy Gallagher·Sep 28, 2023

How thinking like an investor led one sales rep to build "life changing equity" at an $11B startup

Matt Modawell - Rippling

Matt Modawell joined Rippling as an Account Executive in 2019 when the company's valuation was around $300M. He has been one of Rippling's most productive sales reps for nearly five years, making President's Club three times as Rippling's valuation climbed to over $11B.

In the first installment of our employee interview series, our founder Billy Gallagher chatted with Matt about the lessons he learned from the first three startups he joined failing, and how learning to approach a job search like a VC led Matt to Rippling.

Billy Gallagher: Tell me about how you first broke into the startup scene.

Matt Modawell: Right when I got out of BYU, I started working at Goldman Sachs and I hated it. I just hated big companies. I hated the culture.

I was in Salt Lake City. I wanted to go to Silicon Valley. I wanted to get out of Utah and go to San Francisco to, you know, be in it. And I’d heard of people making a ton of money in startups from the equity.

I joined a Series A startup called Jott. They had funding from Accel. They pitched it to me, “hey we have money from a big, top tier investor.” So I joined them and moved out to San Francisco.

And a month in, it's obviously not going very well. They ended up going belly up.

Billy: And before you joined, did you think, “oh my god, I just found the next Facebook” or were you sort of like, “whatever, it's a job?”

Matt: Yeah, I legit did [think it was the next Facebook]. It's a funny story. So they were a social media messaging company. They actually had an offer from Facebook–Facebook offered to buy them. And they turned it down.

And they had Accel who is an early investor in Facebook. So I was like, “this is it.” We're either going to get really big and become like Facebook, or get acquired by Facebook.

Billy: And how long were you there?

Matt: Less than three months. From there, I joined a company called Sentieo. I was there for around two years. When I joined, they didn't even have any seed funding.

We were actually fairly successful. It just turned out to be way slower, like super, super, super slow. And I realized, I'm not gonna make money on the equity side unless I find a company that is a home run, $10 billion valuation.

Billy: right.

Matt: So I realized, I need to find a company that's going to grow really quickly. And that's when I learned about Y Combinator.

I started to understand the level of investors — if you get a company that has the top investors, like YC, Sequoia, Kleiner Perkins, backing it, that's huge. And not just the firms but the partners too.

If you’re [Kleiner Perkins partner] Mamoon [Hamid] or [Y Combinator CEO] Garry Tan, you’re going for home runs.

So I made a whole list of companies: Airtable, Rippling, Atrium, Lattice, Pilot, Amplitude, etc.

Billy: And, super tactically, how are you doing this job search?

Matt: It was a lot of Crunchbase. And then looking at who was in the YC batches. I was looking at the websites of investors. So I was going to Kleiner Perkins, Sequoia, Accel’s websites and looking at their portfolios and job boards.

Billy: And when you looked at a company that YC had invested in, was it more looking for companies that were interesting to you or companies you thought would do well?

Matt: More looking for companies to do well. At Sentieo, the product was so freaking cool…but we had never done it before so we were making classic mistakes.

And so I was looking for a company that would succeed. At that point, I wanted to find something that's going to get huge. I'm going to get a ton of equity. And like, I wanted it to be life changing equity. I don't want to just have a cool job. I wanted to be like, “hey, I was employee X at this company.”

Billy: And were you thinking, “ok I can join this awesome company, get this life changing equity, level up to an exec job at another company” or did you just have tunnel vision, “hey I want to buy a house” or whatever the end goal was?

Matt: I think this is interesting. I have zero desire to be an executive. I have zero desire to be a founder. I love being the guy on the street–no one knows who they are.

Billy: Totally. Okay, so back to that job search. How are you sussing out which companies you thought would do well versus which ones you're like, “I don't know about that one?”

Matt: The first thing I would note is not just the VC fund but the partner investing in the company. So Mamoon Hamid and Garry Tan had super impressive track records. That was my top signal.

Then I looked at the size of the markets and tried to eyeball “how quickly can you grow?”

Then it was really the founder. I learned that a lot of the big founders in Silicon Valley were previous founders before. VC firms are more likely to invest in you if you already had a successful or even a non-successful startup before.

And that's kind of how I narrowed down a little more on [Rippling cofounder and CEO] Parker [Conrad]. I had a lot of friends who worked at Zenefits and they all had jobs immediately after Zenefits blew up because Zenefits was so successful for a time. Even though it failed–you were there for that growth, you saw what happened. They had jobs immediately.

Billy: And then, you've got the short list. How did you go from a Google sheet to lining up interviews?

Matt: Yeah, so since I’m a sales rep, I started networking. I'm not just gonna apply. So I did a ton of networking.

Billy: And eventually you get through the interview process and get an offer. How did you evaluate what you thought Rippling would be worth?

Matt: I remember I had a conversation with [Rippling CRO] Matt Plank and he was like, “this is it.” He wasn’t thinking about his next role–this was the company.

After that conversation, I knew I was going to join Rippling.

Billy: And what were you thinking at the time–did you think it was a sure-thing home run or did you think, this is an at-bat with good odds?

Matt: I remember Plank saying $10 billion valuation. I didn’t think it’d be that big. I knew it could be at least a $3-4 billion company like Zenefits.

The hope was the equity, right? But I thought, at least I'll have the experience and learn and go to the next startup if it fails.

I thought there was a 75% chance of being a very successful startup and I’ll make some good money.

Billy: When you got the offer, did you negotiate? Were you pushing for more equity, more salary, or were you like, “hey I’m just happy to be here?”

Matt: I called up a mentor and he coached me to ask for more equity. I explained that I sincerely believe in this company, I think it’s going to be very successful, and I need more equity to feel invested in this. And I eventually did get more equity.

Billy: Makes sense. Do you have any advice for job seekers today?

Matt: I think one thing I would harp on is the fact that I don’t want to be a director or executive. And I really think that a lot of engineers don't want to be like some super senior director or an executive.

But they can get paid a lot and they're going to make a lot of equity. I think one big takeaway I have–you can make a lot of money not being some top executive but being the sales rep, individual contributor, and still make life changing equity.

This interview has been edited and condensed for clarity