$2B Gov Tech CEO's Warning for DOGE

0:00 we sold the company last March Cox Enterprises buying open gov in a deal that values that company nearly $2 billion we're pivoting the entire company to go AI first using in how we develop software how we code entire large processes could end up being run by Ai and this is where things get really scary people underestimate how complicated government is what advice would you give to the Doge team I would never bet against Elon this is an

0:22 undertaking of extraordinary magnitude it's going to be extremely contentious it's about Quantum Leap Forward and what's possible in of government service CEO Zach Bookman is an old friend of mine he's the co-founder of open goov

0:53 with me which he built into a multi-billion dollar company and he's making government cool again you know we've been talking about this for decades but the V shift has happened efficiency is a cool word we're going to make government cool again we're going to make government great again in America it doesn't just mean Doge and DC you know a lot of our lives are most impacted by our state governments by our local governments Zach works with

1:13 thousands of these governments in America and he's delivering solutions that are impacting all of us in really positive ways and he's really excited about what's coming next with AI and otherwise it turns out you can build a great business that makes a lot of money and positively impacts millions of lives including fixing our government there's a great story here from to tell I'm Joe Londale welcome to American Optimus really excited to have my friend Zach Bookman here with us today Zach thanks

1:35 for being here thanks for having me Joe I'm really excited to be here Zach was co-founder of me with open goov which he still runs a CEO an amazing company Zach tell us a bit about you you graduated from University of Maryland went to y Law School you clerked at the ninth circuit like like what's what's your background so I grew up I guess as it relates to open I grew up near government I grew up in Washington DC

1:56 born in DC grew up in Maryland went to high school in DC and then I went to University of Maryland first 20 years of my life were just I thought government was everywhere and you know everyone knew someone who worked in government in Maryland I guess it was the way you were it's just kind of when I I ended up I was a you know entrepreneurship then was like a lawnmowing business when you're young and I raised money from friends

2:17 family and fools to do an investment fund when I was 20 but I I guess you could say I was a failed entrepreneur and I went to law school and then I did a master's degree in public administration and after grad school went to Mexico and was a Fullbright fellow studying transparency and corruption in the Mexican Government good place to learn corruption I well after I solved that went to the ninth circuit and clerked for judge

2:42 Sandra iuta in h Pasadena which is which is literally on fire right now this it's a wild time to even be talking crazy stuff yeah and I went up practiced two years of law in San Francisco and then I went overseas to Afghanistan and served as an adviser to General McMaster on the anti corruption task force and that was a kind of surreal year and as you may remember we were starting opengov at the same time yeah i' met you

3:08 through a friend you clerked with in the nice circuit and one of my smartest friends from Stanford and really impressed by you and we got to know each other you were helping me build our fund originally and ended up co-founding open go together then and then you went off for a year during the founding to go go solve corruption elsewhere instead yeah yeah I wish I could I was obviously joking about Mexico and we we we joke

3:27 sometimes that we solved everything in Afghanistan came home and decided to focus on State and local government in the United States what did you solve in Afghanistan though like obviously you can't fix it it's a mess like was did the US even like have a meaningful impact was it just a joke we couldn't have done anything we should have been there it it was a pretty sad experience for me I mean on the one hand it was exhilarating it was amazingly

3:47 educational so General Petraeus set up this task force and it had a kind of a dual mandate to map all the spending from the Coalition the Coalition was basically the United States Plus everyone wanted to get into NATO and you know people would send over like a broom Brigade and other things but like 50 countries were involved and we were spending a lot of money and where was us money going with respect to its contractors stories about handing out

4:15 cash to tribal leaders and stuff the movie the movie wargs did you ever see it yeah or You' heard of it maybe anyway it was like based on some of this you know people would literally set up like Oh I'm a government contractor and I'll build you a stadium and they'd get some some award for you know a very large amount of money and it was just like a a couple in the midwest who's like decare

4:36 you know so crazy things were happening when you're spending that kind of money things are going to happen and then the task force spent most of its time on trying to help the Afghan government investigate and prosecute high level corruption cases you may remember the cabble Bank Scandal and there was this really brutal scandal in the dwood military hospital where the corruption ran all the way through the hospital to the point where the nurses at bedside

5:03 were demanding payments from a wounded Afghan soldiers in order to receive food and water and people starved to death who couldn't afford the payments that's crazy and these are Afghan Patriots who are fighting for the Afghan Nation so a brutal culture this was this was really like serious stuff wild stuff and the task force was totally surreal I went over there I was literally wearing a sport jacket like this I was lawyer and general McMaster I I I met him through

5:34 a mutual friend who helped architect the the surge in Iraq and was in kind of General Petraeus Brain Trust with General McMaster and he said come over I want you on my strategy team son and and I spent it took a Year by the way I had to go through you know deep background check and security clearances and they sent me to Blackwater to shoot guns and and funny story there I was on the eve of I'd quit my job I sold my car

6:00 and rented out my apartment in San Francisco and I remember playing golf with you right beforehand I said hey this is what's going on and you were like what are you nuts like we got this fun going on and we're talking about open goov and like all these amazing things are happening and I was like I think this is important I think I can manage multiple things you're like you're nuts but you know and somebody in Congress forgot to attach a

6:28 counterterrorism line to the defense bill for $75 million that included my contract jeez and so the task force calls me up they're like we can't have you over and I was like well that's not going to work I've rented my apartment and quit my job and sold my car and they're like there's nothing we can do I said we will fix this I was like I need to talk to the general like now and anyway it ended up

6:53 getting fixed got over there and I show up and everyone's walking around in green pajamas and I'm wearing like a sport jacket and there's guns everywhere and tanks and this is like you're supposed to grow a beer before you go too cuz it shows your if you're fresh face you're I grew my hair I grew a beard I bought clothes at the local tailor and I just like started it's like went you know full on and overall it

7:15 was an amazing experience but we you know the mission creep the other thing I saw was when you have loads of smart people working in committees things don't really happen and wasn't the general in charge no he wasn't the Committees were in charge of a lot of stuff huh the general was in charge of this task force this task force is at isaf headquarters the International Security assistance forces headquarters at the time it was being run by John Allen John Allen and General

7:44 Petraeus got in trouble shortly thereafter for the email Scandal there's a 100 plus thousand people all over the country Jesus there are Aid organizations civilian contractors I mean this is like bureaucracy at a level that we don't even have at home and the aid organizations aren't all aren't always good either some of them are are grifting right and a mess people are going full local living among stuff I mean I I wrote a piece for the New York

8:12 Times at War blog I went out into took six trips around the country and I went out into kind of a Taliban area and I met a local they had me at a local shur Council okay this is like their city council and we walk into the building which we built your taxpayer money built a building and there's filled with furniture and they're sitting on the ground in the courtyard and it's in the middle of winter and

8:39 there's snow on the ground and I asked the guy I said why are we sitting on the ground it's freezing out here and he's like well you know the sun is out and you know and I'm like and he's like well the you know in the summer we like to sit out here too I was like isn't it very hot he's like yeah and he's like we just like to sit outside and I'm like like so why' we

9:00 build you a building and he's like I don't know and then he sits us on the couch that says US Government on it and turns out we bought them a a shipping container full of laptops and he's like the issue is we don't read and right wow this is the type of stuff that was going on all over the place it's it's actually good intentions just Preposterous execution this is where to me a lot of like this America first

9:28 lashback comes from was it was clear there was just like insane amounts of money being wasted in Afghanistan on stuff that maybe was good intentions but it was like come on and it I mean you just you just cited earlier there's a culture where in certain parts of that culture there's massive corruption and I don't know what happened to them to break it that bad but if if nurses are killing people for for not paying them

9:47 off like you can't fix that culture with I don't actually see it that way the culture the Afghan culture is kind of amazing so in the in the in the before the Soviets invaded in the late '70s to bring communism to this country this was a place where people of our parents' generation used to like Drive their VW buses across Iran from Europe and go hang out by the river and eat grapes and like go for hikes and it

10:15 was like it was like a paradise and the culture is actually really warm it's really generous and there's this super complicated 40 plus year history of invasion and then opposing parties funding religious madrasas and Freedom Fighters and this is a country that is I mean it's the great game where the Nations around it so it became a war zone all sides the local people are sitting there like what who are you why are you here what's going on so that's

10:45 what happened to a culture CU I was going to say like a culture where you could have nurses and hospitals that people were wearing suits and ties got it and and women were going to school and John F Kennedy went over there and we were helping them do power plants and this so what what we know of Afghanistan is not what our parents generation knew we're watching everything going on in the Middle East now and you know

11:08 history is alive and it like writes itself a new so I don't I don't think it's like their like their culture I mean also if you if you're pumping in hundreds of billions of dollars their culture was broken by what happened yes and hundreds of billions of dollars flowing through all over the place and people's hands there and the money's going no one's going to close their hand yeah no I mean in Africa this is what

11:29 happened I think a lot of places where you're sending in so much money that you actually like create a culture of corruption because that becomes like the default incentive if if that's going this in small companies if a small you you've over capitalized companies right when it happens small it's not ready it didn't actually have product Market fit you dump a ton of money on it and great things happen not usually actually all sorts of waste and pockets of waste and

11:53 weird cultural problems you tell you could tell Mark andreon has been on your board to do too much money my fault not Mark's fault no no that's his that's his thing about not overfunding these things I agree well early early on he I think he also learned that the hard way early on it was big rounds at high valuations you kind of have to learn that they were the soft Bank you know like 10 10 12 you

12:13 kind you kind of have to learn that yourself though because it's one of those things where you're like what I I would be fine with more money I jump in open gov so you you came back you helped us kind of with inial ideas as a Founder help to get going ended up replacing a CEO which is very common early on these things and you came in to be basically the really early CE that was that was 2012 2013 2012 yeah

12:34 da and Nate and me and you got it off the ground you were founding chairman we were investors board members and denan and you you said hey come on back in the summer of 2012 and I got back and it was it was like total chaos and a completely different world and I was you know I also showed up in a sport jacket and they were all like what are you doing at that point in Mountain View it's the

12:57 Redwood City I guess it's a little bit different culture give the audience a sense of what open goov does and how it operates maybe in use case me pain so so open goov was was was the company was bought by Cox Enterprises for $ 1.8 trillion doll last year billion say trillion that's funny we usually edit that out leave it in there leave it in there to make fun of me I'm dealing with all these government budgets right now on Doge so

13:18 it's like trillion this 1.8 billion dollars which is a nice it was a it was a nice win it did really well and it was a cool what was really cool for me is it was a mission where we were creating this for to help the country and help these cities based on things we found out and other stuff we were doing so it's really cool to have like a for-profit mission that ended up both making money and helping thousands of

13:37 cities I think it was one of your core and fundamental insights that you you and Nate and a third guy from Stanford started a nonprofit 2009 or 10 yep and you wanted to map the California Budget and understand where the money was going and what was happening and why the state was having trouble which it was and is and it was through that work that actually you and we realized you can't really build technology and software at real

14:08 scale and get it to the Enterprise in a nonprofit Contex You' got to combine the the for-profit motive to get the very best people with the mission that inlines and inspires everybody including the customers and process 100% it's the people and it's the processes which is obviously intuitive to you now as a CE but there's so many things you do to run and grow a company with these really aggressive processes to take your mission and take your stuff and bring it

14:30 to the world and like a company's built for that specifically a nonprofit just does not work to do that skill it's interesting because I tried to tell Michael Bloomberg this at the time and this is why this is going to be much more impactful I think than just paying for money people these cities and he was apparently really offended by this and didn't want to talk about it it was like a somehow for him it's like I

14:46 make money on my Bloomberg Finance thing and I and I and I spend money on my government did you ever get an answer to that I mean I never fully understood yeah people around him said he just like this is not his he's very oldfashioned his view of the world is you cannot ever make money M on government because it's his way of giving service which I get but I was trying but I was trying to

15:03 explain it's not like even even if you just want to give all the money away you got to use that framework we spent years wondering like w we we would love to Ally and think they would love what we're doing somehow for him and make I think he's he's comes from the left a long time ago left and I think money is a dirty thing and and it's not when it comes to service you don't combine

15:22 I his book Bloomberg on Bloomberg and AER he has he has a line there he made just the company started working he's like I went home and I bought a mink coat and it cost $110,000 and I was so I you know maybe it's a dirty thing when he put in his book it's dirty when you combine it with service he wants to be he wants to be coacher like you you don't combin and I respect that there's

15:46 something that makes sense about that but I think that that our nation's governments wouldn't agree with that they want and need the best tools to do their job they need companies built to to achieve that which which which it is confusing because a lot of people on the popular side would would intuitively agree with Michael like oh if you're making money off government that must be you must be sketchy but at the same time you and I both saw that it's the only

16:07 way to create these things the companies that are actually making money off these are quarterly driven public rollups or private equity for that is kind of so there are a lot of icky ones is what you're saying there are that's what's that's what's the status quo yeah you're going to attack it and try to do good anyway the mission of the company is to power more effective and accountable government and it's down into the DNA into the soul of the company I think

16:32 it's okay to go that chain a bit longer it is very different than other government tech companies because I think the historical G tech companies like you said you buy things up you try to raise their prices you you it's like it's like these giant private juice the EA customers hate you this is one of the things other companies like big thing of open goov and a lot of things we did in Silicon Valley is let's do something

16:49 where the customers love you and they do correct what you what your NPS do you have an NPS it's actually really hard to measure we think it's high but if I gave you a specific score kind of bogus it's definitely higher than anyone else anyone else in your space well it's part of it is the complexity of government you've got a maybe a city administrator then you have a deputy then you have a department head then you have a user and above the

17:13 administrator you have a council so who are you measuring yeah who's actually the customer who's really happy or any other the citizens use are getting to experence it which is exactly and yeah so it's it's a very very complicated space and you described it is exactly right some of the stats Oracle apparently 1% of its public sector customers end up in lawsuits it's regularly have to see and more than half end up quote fully dissatisfied well

17:40 there's if you're I think I think there's like a certain type of aggressive capitalist there like if some people aren't suing me I'm not pushing hard enough which is not at all our framework it's like I can see someone thinking that right it's a different way of doing it whereas we're like actually like maybe we left a few dollars on the table but we'd rather have the brand in the to in the engagement to do the right

17:58 thing all always if we can which my preferred way of doing it it's our first value is build the trust do the right thing and the second is live our mission for the greater good so these companies are really hard and take a long time to build i' I've made a lot more money doing things other than open go even though I'm very proud of I work together on it we did make some money what were some of the hardest challenges what

18:18 were some of the mistakes you know that that we made as well what were some of the hard things so I mean getting one of these things off the ground requires someone as crazy as you and daon and Nate and the people who are backing us amazing people it's literally you know Bobby yazdani was a friend of yours stood us up on stage like many years ago I was like you all are crazy you're crazy we

18:40 were speaking at like the sabba global conference or something and so there's just a true like kind of crazy Gene that has to be and and I feel very lucky to have been Associated because if I'm honest Joe I wouldn't have done this on my own M there's no way you kind of have to get pushed a little bit I was a little institutional yeah you're talented enough that we needed your help so that's good well thank you but so

19:05 this takes I mean it's it takes like a coalition yeah and and then people have to work together and when you have people you have conflict it's like it's literally that simple and so all the disputes all the confusion all the misalignments all that and then you sprinkle a bunch of money on it because if you don't move fast if you don't have the resources to move fast you end up like a lot of the garage built companies

19:28 not too much out too much on it and you're doing waste and burning cash one of two two of the hardest things for me early on I'm curious how you react one of them was I'd always want to do things like government should be doing and and I say here's like this the way they should be comparing and this what they should be doing but it turns out they don't have a specific budget and mandate for it it's really hard to get to them

19:48 what they should be doing let me dig into that that's a I'm not upset anymore but that was a point of significant contention so we were building this company the first couple years and you had very strong vision for a network of governments that learn and share from each other and Benchmark and we will build the world's largest repository of Public Finance data and they can find out what's wasted and how to do better and so on and I I came back

20:15 I like oh Joe successful entrepreneur he knows what he's talking about he's one of our spiritual leaders said he's got to be right and I wasn't a very good CEO at the time and so I hired somebody let's do natural language processing and machine learning we had a whole data team and we're working on this and we're building this comparisons and benchmarks there's only one problem there's no budgets for it the government people don't want it the government didn't want

20:38 it I think some people want it it's deeper than that they say they want it and then they'll offer you 5,000 bucks for it yeah well you know what it cost a lot more than 5,000 bucks to build and a lot more than 5,000 bucks to even sell it to you it's not a business it's true and so after a couple of years of this we're running out of money I'd hired by the way an executive team you know your

20:59 standard you know hot Silicon Valley Executives who all want a quick win off this network effect this is going to be the Facebook of governments or what have you I go to an offsite and I'm like we got one bullet left that's it we're running out of money we got one product to bet on do we bet on a system of record like budgeting software or do we bet on comparisons and benchmarks the team split right down the middle and

21:23 that was a big wakeup moment for me where I was like I have to be the CEO here and I have to make to work here and I love Joe and I love these Executives but I have to use my judgment and we've got to build budgeting software and we've got to get to the tools you come for the tool you stay for the network we've got to build the systems of record before we get the data to do the amazing

21:44 things you you came back and we talked about it half the freaking team quit in the next two or three months well they realiz it's going to be hard work to actually be able to process these and it's not why they joined yeah and and and so anyway that was one moment I want to turn around why did why did you want to start this company I mean there's a few different things but you know we had this smart

22:03 Enterprise wave thesis which actually you and I wrote a great paper on the coming transformation I think from 2011 2012 around the time we were studying basically a lot of stuff in that seemed right like a great piece to go back and look at we link it under under the thing so you know it's it was clear that there were a lot of new possible companies that were going to be created kind of like there is now which you can talk

22:23 about separate but there's a bunch of new things thanks to Cloud that could be done that couldn't be done before and there's a lot of things they work work in ways that were better than they could work before and and there's and it's like what are the most important ones and like I was obviously working on adapar which is you know sit on top of the world's Financial capital of trillions of dollars that's a very important newcloud company is doing

22:40 great as well and it's very clear to me that like being on top of like cities and states and and and helping government work better first of all it's like one of the most important things to do to make our civilization function it's very inspiring I think and it's very important as a mission like if these governments are stupid and they're not using new tech and then you can't count votes you can't put out fires it's

22:57 not a good thing so things like that need to be done more efficiently and then on top of that it was it was like it's clear it is really valuable as well to have something that that's needed by these you know tens of thousands of customers and to make them work better and so so this was you know and I knew it was really really hard I didn't appreciate quite how hard it was of course which is always the case you kind

23:16 of as an entrepreneur you kind of don't want to appreciate quite how hard things are going to be or or you wouldn't really do as much if you knew how hard it was going to be you probably wouldn't do it this this is always the thing about talking to entrepreneurs is like if you're trying to do something in the space where they've worked for 10 years they're always extraordinarily negative on you and it's just like a rule like

23:32 the two rules is first of all and you don't take like an SMB business to the stoppelman they'll be like this no terrible terrible idea guys don't want to do that it's yeah it's like first of all any Co you bring in everything was shipped before I was there is always the rule and then the other rule is like yeah this space is like 100 times harder than you realize it's like the two things I get

23:49 from every single CEO but it was but listen I'd been in pal new government was frustrating it's a different part of government and and it just it was just CLA it was so broken right it was clear it was so broken that there had to be something to do and so did you get I I mean I got laughed at when we tried to raise money including from some of your friends and your network and it was a it

24:07 was a avuncular kind of laugh like good luck with that you fools did you get that a little bit not as much because I just made paler kind of work so maybe they're afraid to laugh directly it was like Yeah Joe that's like a nonprofit area not a for-profit area and and we're like well there's these big companies here but they're like oh it's impossible and it was almost impossible but we figured it out you know the first thing

24:29 was that government only pay for the processes that they're already that they're already doing right that was big the other thing that was very unintuitive to me was how hard is this to grow quickly even when there something people need and so you end up having to like buy stuff as well in order to in order to expand so you can obviously grow organically but it just seems naturally really hard to grow organically I guess you have some stuff

24:50 growing 50% right now which is unusual but it's hard for these companies to grow faster than 20 or 30% usually for the most part why why is that I think it has to do with both the Innovation cycle in the buying cycle so to actually the people underestimate how complicated government is and if it wouldn't bore the heck out of you or your listeners let give some examples I'll well I'll a lot of people I don't think stop and try

25:11 to understand what these governments are so let's take a a city for instance a city what do what do we do we create an incorporated entity We the People Incorporated entity get it Incorporated by the state and we throw in all these for-profit nonprofit business lines that we either don't want or can't have in the private sector and we set up a corporate structure if you will there's a board of directors we call it the city council it

25:39 represents the stockholders who are the residents Y and they the board appoints a CEO we give it some diminutive title like general manager or city manager or town manager the CEO always gets a little tiny title but they're actually really important they're the CEO yeah and they appoint a an executive team the executive team has funny titles like director of Public Works director of Parks and Recreation director of the library but if you think about it these

26:04 are the services that we want and we rely on every day and it's funny because the mayor is more like the chairman of the board usually than they are the mayor cuts the ribbons and he a guy in town he makes $6,000 a year or or a gal and or sometimes unpaid and they spend all of Tuesday night and frankly way too much time and it's like the sixth grade class president or something you know it's like likes to you know be a

26:27 ceremonial figure but some strong mayor some strong Mayors are the top 1% of governments are run by a strong mayor so these are the largest cities in America that people think of when they think oh that's a city but we live in towns we live in counties we live in unincorporated areas and we have governments everywhere and we drive on the roads and we flush the toilet and we turn on the light switch TI to and we never think about this is

26:51 your tax dollars this is your property tax this is your gas tax this is fees fines hotel tax what have you and that money goes into various different coffers by the way you can't spend that money goes into funds and the core difference between a company and a government is often the multif fund accounting so everyone says you're taxing my gas you idiots you can't even you can't even you know deliver my water correctly well I can't

27:18 spend the gas tax on your water because it goes into the roads fund and that's all I'm legally that's all you the people allow me to spend it on and so there's all these cont contradictions and confusions and everyone just gets angry except it's our government well sometime and sometimes it is run poorly but sometimes it's run really well too right when it's run poorly people should get out of bed vote for someone else and go fix it yeah not even just vote you

27:43 can raise your hand and go run for Town Council you can go be city manager that's true it's a Hey Joe it's a free country I know I know it's and some of my friends have but it's it's it's pretty rare they don't want to it's easier to complain and it's hard I mean to be clear we pass some props sometimes there's different ways of affecting it but yeah it's it's tough Talk what do you think's going to happen about AI I I

28:04 want I I'll tell you my views but I want to hear Joe lale on AI with respect to State local government in particular let's do one acquisition question really quick John Chambers might who was on our board might be the the best expert all of us know on this because he bought over a hundred things at Cisco and crushed it and he was really helpful to have around obviously what were what were some of the things you learned as

28:23 you you bought a lot of companies you integrated them you you I think you bought them well and you grew them 50x and some cases and stuff so like like like like how do you do these things well luck played a very large role in this but we our strategy was completely different to our competitors our competitors would buy companies based on Revenue based on profit customer footprint based on basically anything other than product quality and Joe you're a product person

28:50 you're a builder you want the best people you want the best user experience the best user interface and we took some of that snobbishness if you will well Silicon Valley DNA it's Silicon Valley DNA and we just don't want to be associated with with companies or products that we don't believe in and that we don't admire and that was the heuristic and John I met John at the W at the world economic forum and he was

29:16 the most gracious I think he was just leaving Cisco and looking to build his kind of venture fund and he got involved and one of the very first things he said to me I had a I had a a deal with some entrepreneurs that I've known these people I've been in the in the indust in the local government industry with entrepreneurs for years so I know who's trustworthy who has that kind of shared values who's building the best products

29:38 and I told him about when he said you can't buy that they're not located in Silicon Valley and I was like what do you mean he's like I've done 185 Acquisitions you got to do it in Silicon Valley you got to do this you got to do that and I was like well I signed a term sheet with these guys in Boston and their products amazing and this is going to revolutionize how we get Perman and

29:58 licenses which is a huge important space in local government and it was another CEO moment where I was like I'm not going with John's advice and John was a little annoyed little disappointed and probably like I probably wasted my money on this company namely Zach and it's worked magnificently and as we strung together successes across permitting and Licensing procurement Asset Management Asset Management by the way was located in Iowa and the company's amazing the best product in the market this runs the

30:29 entire public work this is ironic because John did WebEx to help people work together across John John John now and we're become dear friends and he's an amazing mentor and he's like Zach you educated me on m&a no one's done more mmaa than me and no one's made more mistakes than me and I thought I knew what was going on and you redefined it and he says now two nice things I'm like John a lot of this is industry

30:52 Dynamics they they tend to work the software is very sticky I really appreciate the kind words but that's kind of funny example where it's like this bace is a little bit different and but product quality has been the has been the and how did you integrate like the cultures and the tech and stuff was there any tricks on that it's been super hard we you go to these places sometimes well I mean I I yeah you got

31:12 to show up you got to show face you got to show the energy and the enthusiasm we believe it we we have we are a values driven company build the trust live our mission act with urgency learn and grow win is one and we repeat this stuff and we talk about it and people look at me like I'm nuts and some people eat y most we've retained most people the Enterprise Asset Management acquisition in Iowa we lost a quarter of the people

31:38 well I yeah and I and I found there's places like Iowa there's amazing people but there's also some people who are not used to the intensity of the culture there's a lot of that and and we also found in other companies look everybody everybody's home is messy when you dig in everyone's marriage has issues and everyone's company is not quite as good as they mark it and so we saw a lot of companies with lots of problems and

32:02 you dig in and wait a second that person actually hates that person and they fight all the time and they don't even trust each other and so we'd end up having to go do Psychotherapy and marriage counseling and the whole thing and it's like you know it's it's it's Hands-On these things are always these things are always messy on the inside but you you make them work I I love it well it's it's amazing what you what

32:21 you've accomplish Zach it's been great being your partner at open go thank you know the two of us have been talking about government efficiency for it's finally cool now all of our smart friends are going and and doing you know doing Doge and stuff what advice would you give to the Doge team go deep and maybe start with the Postal Service I have a funny story I mean it's it's literally personal and I related to the

32:41 Doge seven-month old baby so my first baby was open gov child out of wedlock and and now kind of growing up a little bit and we took the baby to the post office to get a passport this was like six weeks ago and it's not that easy to take a 5-month-old baby and there's nap times and there's a window of 30 minutes where they take walk-ins and we show up and the woman behind the counter at we show up at 9:34 yeah 9:30

33:08 to10 is the open window and she says no no more walk-ins and we said what we're carrying this you know stroller and there's a woman in front of us with her daughter and the woman is sobbing and a young couple with a baby comes in afterward and everyone is stunned and this woman behind the counter just says no more walk in I only take two a day and I said well it's 9:34 there's no way you could

33:31 have processed two passports in 4 minutes yeah and people start crying I mean this is insane the woman just didn't want to do it or she made up her own rules and I'm a recovering lawyer and I'm kind of obnoxious and I said I'm going to need to talk to the manager here took like 15 minutes for a manager to trundle out of the back and the manager was scared of the employee very obvious this is a rogue employee this

33:54 was a dys a level of dysfunction that was extraordinary yeah it's it's totally insane it's totally insane this is the United States of America this is Lumbard Street in Downtown San Francisco and one individual gets to ruin the days and weeks or vacations of young families because she made up a policy on her own that is not the post office's policy and it's gotten so sclerotic that she can't be managed something is clearly broken here I've heard by the way

34:27 talked to some of the people involved and maybe it was you who told me this since covid folks are allowed to federal employees are allowed to work from home or remotely they have to come in one day a month so many people have moved away to other Mountain houses or Beach or home with the folks and they come in the last day of the month and the first day of the next month and they end up working

34:50 in the office two days in two months MH is this true i' I've heard I've I've heard about it I guess we're going to find out more of the details once we get in out and president bid's Administration is trying to lock it in so all these people are allowed not to have to come in at all anymore they're trying to as they leave to make all these agreements but I think I think we're I think I think there's a lot of

35:08 hype I think there's a lot of excitement I think what tends to happen and and you've known me for many many years now and I'm often the one whether it's at the at the dinner or in a meeting saying hey like you actually have to understand how these institutions work and you have to go deep and you think it's really simple and it's not and you think everyone who works in a government agency is stupid and they're not there's actually a lot

35:31 of smart people there's a lot of people who care I I do believe that and so I do as you know as excited I am to maybe not have the experience we had in the post office last month I do think this is an undertaking of extraordinary magnitude and look it's going to be extremely contentious including to you know Go full Twitter Style on various government agencies but there needs to be a level of there needs be a level of empathy and

35:58 there's got to be a level of understanding or or it would seem to me it's not going to be particularly successful I would never bet against Elon given the track I think it needs to be extremely bold but then there also has to be another side of it you're right that has some empathy and understanding and frankly partnering with the best people in some of these places that's how I've always succeeded the paler and I think it open goov as

36:16 well is you you find but also you find at the government that there are some good people there and you partner with them and and they and they and they pull you in like the reason open gets pulled in is because there's like really competent person in One these cities and they're like I am competent and I want to get things done and we're going to work with the best thing right and to me that's like that's what you need is

36:34 there's yes there may be like that annoying lady and a few lazy people but then there's like a few great people let's find them and I mean two notes on that one my my father was a civil servant he worked at the National Academy of Sciences in Washington and I mean he was at his desk at 7:30 in the morning every day I mean most people in Silicon Valley aren't actually at their desk at 7:30 in the morning let's just

36:54 get real and he would come home after 6:00 at night and then we do a little dinner and he'd sit on the couch reading his stuff and it's like that was the 80s and 90s there's a lot of people doing that and the second anecdote is these regulations that we all hate let's just get crystal clear on who created them we it's very obvious in local governments it's less obvious you know there's a there's an US versus them in the federal

37:18 context political parties but we vote for these people and every time there's a crisis or every time there's some corruption we create new rules new regulations and what does that do slows everything down how many companies have you had that have blown up or made the wrong move or had a near-death experience the board it's not a good board if it then goes into the entrepreneur and says all right from now on here's how things are going to work

37:42 and here's a new set of rules and regulations on how we're going to it's not really how it works is it you know you you don't want to over you do that you're going to slow everything down you're GNA you're going to make it worse if you over regulate you're GNA make it worse I I totally agree one more one more question on this area is AI it's a big one I'm really excited about how is

37:59 going to hopefully make government way better over the next decade how are you thinking about AI how are you using AI we are excited too we are extremely excited we're pivoting the entire company to go AI first and this is the obvious stuff from using it in how we work using in how we develop software how we code including some tools in the hvc portfolio we are lacing our product with AI we're using it to outreach and

38:24 touch customers and show them our love basically everyone who has two arms becomes an octopus with eight arms and the whole thing so you know all that everyone's talking about that in the government context there's two things we think are going to happen one is and in my opinion many of these systems are going to start to be run by Ai and there's a second layer of that where like entire large processes could end up being run by Ai and this is where things

38:49 get really scary and why we think we've got to build this with trust and transparency at the core but this is going to happen and whether it's sales force or open AI the governments are innovating themselves we we see many governments believe it or not that are actually using AI in some cases ahead of certain companies they are excited about it so it's moving extremely fast and it's why we're putting trust and transparency at the core of everything

39:13 we're doing but we're Reinventing what we're doing and it's well you've built software that AI agents are probably very capable of using so we might as well teach them how to do it it's and but it's agreed and it's imperative that we run the AI instead of AI running we were talking about this earlier I still think it's like you might have an apartment that instead of having 20 people as 10 people retire you have the

39:35 people who are left use AI to each to be more effective and eventually over time maybe you're three or four times more effective but the people but there's still people running those processes we using these agents it's it's it's about productivity it's about Quantum Leap Forward and what's possible in terms of government service our nation's governments most people don't realize this they can't recruit the people they need right now tough you have to compete yeah you have

39:58 to compete I mean we have a dozen amazing recruiters that are Outreach that are using AI to magnify their Outreach we're building brand we're doing all these things and you're running a local town and you're regulated like crazy you can only pay this much you have all these step functions for how to get ahead if you do something great you get a slap on the back if you do something bad you're like Pock marked and like run out of town

40:25 it's a very difficult environment to work in I've been run out of town a few times it's a difficult environment to work in and so we're seeing our customers and governments across the country that are underst staffed everyone's upset they're so overstaffed it's not it's it's it's not that simple and AI holds the tremendous potential to do more with what you have yeah because a lot of these people are overwhelmed as well and so let's help these people I

40:49 think they like their job better if there's if certain routine parts are done automatically and they get to spend more but also we all get so frustrated you want to go you know renovate your bathroom or build a deck and you permits let's issue these permits in 5 minutes and be very transparent about what the process is and the steps let's take your payment in and let's tell you we took your payment in and tell you when it's

41:08 coming and all of that so there's all these proces that should should be really fast well but there but there is one thing I mean I I do want to mention people get confused government is not one- siiz fits-all you know we're out here in the suburbs with large properties you don't want a shopping mall next door we do need zoning yeah you don't want a shoppingall yeah that's true and yet there are there are towns like Kyle Texas I don't

41:33 even know that's not very far from here that is booming they want the shopping mall and so the job of the job number one of a government is to elucidate the wants and interests and needs of its Community yeah and this is this is something we started off with that I think we weren't very clear on we thought there is a little more one- siiz fits-all the tech can be useful but the way they want to use the tech is very

41:54 very different you got be you got to be really clear what the what the rules are on how to tailor it and how to bias it in different ways give them the ability to do for their residents and citizens what those people want the people in charge need to be in charge and then then you help them go fast if it's a horse community in Florida or in California they don't want massive building and five minute

42:14 permits that's true Woodside California would probably push back on this use case they want an AI agent they just like tell this just like just delays you is very kind to you and makes sends you yeah makes you take three years to get approvals for your for your fake horse bar order you can build something on your property Zach we started American Optimus to push back on the pessimism and cynicism in our country and you know a lot of people sadly

42:37 expect dysfunction from their government but you know what do you think government could look like and will look like over the next decade is it is it still Pock dysfunction and some really good things like like how do how do we make this something that's that's really great I'm excited that effective and accountable are not bad words anymore this is our mission statement to power more effective and accountable is a big Vibe shift huh it's a big Vibe shift I'm

42:57 excited that the word efficient is not I mean maybe it is politicized but it doesn't have to be yeah I want a world where you can hang an American flag in front of your house and it's not a political statement and I think that we can return to a land where government works for its communities not just for the people I want a world where it's a noble calling to go work in government you know 80 or

43:23 100 years ago our best and brightest went into government the m Nas the kennedies what have you like it was Noble to be in government David ggen said the Baby Boomers wrecked it yeah and we're in a generation now where I think there's like a Resurgence of like wow government could actually be really valuable and really cool and if we do this right it can set up our markets and it can help us innovate and it can

43:50 create a better quality of life but I I'm very bullish on what's Happening in terms of the Innovation taking place in government the people that are going into government what's happening in government and this is not at the federal level just to be crystal clear in case you're you want to push me on it we only sell to State and local governments half of our money half of the taxpayer dollars go to state and local governments and we never talk

44:12 about it yeah this is a huge part of our country state and local that that we talk we talk way too much you know you know I work with sister obviously on the state and I'm really passionate about that and it gets way less play than it showed relative to the I think all of us have this instinctual thing like being in a in a dog pack where you think about the the leaders and you're thinking

44:28 about the leaders in DC but there's actually leaders in the state there's leaders locally that matter matter just as much to our lives in many cases well there's also like a pretty strong dialectic like the states and you know this you're friends with many Governors they they get annoyed with the federal government all the time and have fights and who do you think you are this is the state of such and such well the exact same thing happens with the local

44:47 governments to the state governments oh yeah so you know disagreement is definitely American there have some big ones like that in Texas let's end on a fun note Zach a few years ago you biked across the country from San Francisco bay to chese bay what' you learn about America what surprised to you that was a that was a very painful trip I biked from the yeah San Francisco Bay to the Chesapeake Bay and we promoted opengov

45:11 and met our customers and did like blog posts and I don't really know what I was thinking I I I thought I'd be able to cycle for six hours a day and then run the company for six hours at night in like a crappy motel and and this is before Starling too so it probably wasn't ideal for well and I was so ignorant yeah I'm on the phone torturing people at the company and then the service fails and I

45:35 didn't it so the the route connects the scenic byways in nine states across it was it was created at the bicentennial of the United States in 1976 and it's absolutely beautiful but I didn't know the word scenic was code word for Hill and it was so unbelievably hilly and I just the cumulative fatigue my body started swelling with the inflammation and you told me you're like Zach hop on like an electric bike or get in the SAG

46:03 wagon for a while just like hurry up and get back and like work on the company no one really cares and I was like you're correct that no one cares but I'm very stubborn and we've kind of marketed this and I'd really feel badly if I didn't you know fight it out you're kind of guy we didn't talk about you run like 50 mile races and stuff so so you are pretty extreme on this of stuff I you

46:23 know I there's something around and you're a chess player and there's something around found I think it was it was Winston Churchill who he took a painting and he said you know the ultimate relief from statecraft is not actual relaxation and you know sunshine or hanging out on the Shay's loue it's it's like it's painting and using the other side of your brain and doing something creative and getting super immersed in kind of a flow State

46:50 you didn't use the word flow you got engage there's something I think when you're working so hard on like you know building software and Distributing it to State and local governments that like you know what I'm going to go run in the woods or like cycle all day P yourself so you know kind of clear out the brain the trip it's a big country and Hill it's unbelievably diverse and the most beautiful States might be Utah and

47:17 Kentucky saw lots of roadkill I almost became roadkill on multiple occasions and you see how different our states are and the cultures and what we're trying to do in the American project and so there's lots of cause for optimism but there's a lot of work to do if we're going to stay unified and we're going to stay focused on like American values and western civilization and market economies and Innovation and leading the world what makes you what makes you most

47:45 optimistic about about you know why are we going to make it work the next I'm going to sound like a terrible you know I don't know Tech bro or something like that it's funny because I came from the land of government and you know you you in many respects taught me a lot about the Silicon Valley ecosystem and got me involved and I was late in the game you were making jokes and you were like Zach you're you're like 31 I think

48:06 you're too old like this is gonna work I don't think you should be involved you did and and but I'll be honest the The Innovation that's going on in America and it's not just Silicon Valley anymore makes me very optimistic Chambers wrote his book connecting the dots and he went all in and this is a guy running you know one time it was the most valuable company in the world and he does early stage Venture and is all

48:32 in on startups and occasionally I'll pass him a company hey so- and so is doing this larger company they're amazing it's too large I want smaller I want smaller and it's going on in not just Austin and not just in New York and Seattle but it's going on all over the country and this is a chance for Rejuvenation and reinvention and so on and it's not political it's people who want to just work really hard and create

48:54 new things and create value so that gives me that gives me hope and then the fact that that government might be cool again and not at the federal level in what open goov is doing and the promise we have I have sorry to be a little promotional here but we sold the company last March and I told you over lunch today it's a weird experience the company's just beginning it's literally just beginning you've known me as a

49:17 nervous wreck for a dozen years that this thing was going to fail and it almost failed multiple times sounds like being cash flow positive suits you but I know you have some really good good plans too and that's fair but I actually I actually think that the potential to do good is just beginning I love well well you're energy to build from the scratch the energy to build all over America that's definitely something to be optimistic about and confident

49:39 government is something we all need and I'd love to see happen so let let's do it Zach thanks for having me thank you