At this past year’s Annual, Noah Wintroub, Vice Chairman of JP Morgan, talks with Eric Gunderson, CEO of Mapbox. Noah has Gunderson tell the story of Mapbox and how he went from bootstrapping to fundraising. Which do you use for your business? And how has it impacted your business? We’d love to hear your thoughts. Tweet us and let us know!

And in case you haven’t heard, we’re building a completely immersive experience in San Jose for SaaStr Annual 2019! With 3 full days of sessions, featuring over 300 speakers from the best SaaS companies around the world, SaaStr Annual will be filled with actionable thought leadership to help grow your business. Get your tickets to the SaaS show everyone will be talking about!


Announcer: Please welcome Eric Gunderson, CEO of Mapbox and Noah Wintroub, Vice Chairman of JP Morgan.

Noah Wintroub: All right, hello everybody. On the background screen you’re seeing some cool maps that I have no idea what they, are but they’re cool. My name’s Noah Wintroub, Vice Chairman over at JP Morgan. Looking forward to working with you all as you scale, go from bootstrap to fundraising, which is the title of this panel. We’re going to hang out for the next half hour. I think I’m the least interesting person on this stage, which makes this the most interesting person that you’re going to hear from. Just by way of background, Eric Gunderson, is one of those originals. Eric doesn’t believe that there is a mold that you follow. He is who he is and everybody wants to follow who he is and who he’s becoming.

Noah Wintroub: When I met Eric a few years ago, I had heard of the company. He’s going to tell you exactly what they’re doing, but you know when you guys get done with this 29 minutes and seven seconds of fun here, you’re going to realize what I realized, which is there is very few things that you have to know about entrepreneurs. Are they honest, are they open, are they transparent, and are they hungry? If they’re all four of those, they’re going to kick ass from bootstraps. They’re going to figure out how to raise money whether no one wants to put money in which has happened many times for Eric. Or when everybody does, which happened for Eric. You’re going to hear about that but before we go into some of those details, Eric just tell us in a couple minutes. What is Mapbox? What are you doing? What problem are you solving and why is Mapbox so kick ass?

Eric Gunderson: Whether you’re literally looking for a gym on ClassPass, sharing photos on Snapchat, watching your groceries delivered on Instacart, getting something on DoorDash. We, looking at weather data coming in on the weather channel using tableau maps site. We make it easy for developers to add locations to maps, to their apps. Sometimes those are highly visual. They can see some of where we basically took video game technology and render out the map over 60 frames a second.

Eric Gunderson: It’s not just the map of the world, it’s your own data put into the map. For example, if you open up Snapchat right now, you’re going to see this crazy heat map snaking through San Francisco because Justin Trudeau’s motorcade just rolled through. You’re seeing everybody post up there. Here it is, it’s their bitmoji world that they made, but and their data that they designed into it, but it’s all of our map functionality and we scaled it all around the world. Give you a sense of scale and there are some, it’s interesting to look back on how that’s changed, but we have over a million registered developers.

Noah Wintroub: One million, wow.

Eric Gunderson: We actually announced that this morning. It’s about as large as any company I can think of, especially on the private side. When Twilio did their S1 file-

Noah Wintroub: Seven hundred and 72 thousand.

Eric Gunderson: Yeah.

Noah Wintroub: I worked on that.

Eric Gunderson: Just for the record, I was stoked when we hit a thousand. I remember that moment I was like, “Yes.” The key part for us is the active developers. Almost 10% of those are active and hitting our APIs in the last 30 days. What’s important about that is that means we’re not just serving those developers we’re serving maps to all of the users of those developer apps. We’re touching over three hundred million people a month. Or better said, three hundred million people a month are touching our maps. Every time you’re using a map that has Mapbox inside, we’re able to collect anonymous aggregated telemetry pact. Latitude, longitude, timestamp, elevation, things that help us, not just map the world live but help us show real-time traffic and also have a much more high fidelity map. We can talk a little bit about how the map-

Noah Wintroub: Let me just, plain English this thing because I think it’s pretty insane. You basically have three hundred million plus people out there and every time they move, every time they do anything as long as one of the apps on their phone touches something that has been developed by Mapbox, which is Snapchat which a few people have on their phone, or weather channel or Instacart or any other app out there, they are feeding back data to you.

Noah Wintroub: The developers actually pay you to use your APIs and then not only that but then you can build massive amounts of data that you can visualize and license and allow people to really understand what corner should I put my store on? How fast should I be setting the car for automatic driving? I think with one of the big car companies. It’s insane. To think about what I got really excited about and the reason we’ve gone from bootstrap to fundraising, I think, is that the number one most important horizontal technology in the world is where are you?

Eric Gunderson: Yep.

Noah Wintroub: Where are you? You know where people are at all times and you know how to aggregate that and scale to drive commercial value out of every vertical.

Eric Gunderson: Most importantly, I don’t know who any of those people are.

Noah Wintroub: You don’t know who they are, which is the brilliance of it, right?

Eric Gunderson: Designing a system that’s private by default, we don’t even require developers to give us any data. Your only streaming data to us when that developer is touching the location antennas, so we have a totally battery neutral footprint on the app. When you’re doing a true business to developer deal, you need to be giving somebody more than you’re giving back. In our case, the map literally is updating for the users where the user are and to be able to stream that live data back, developers freaking love it.

Noah Wintroub: When I looked out there, we had Google, who will not give you the layers because their Google Maps and they want to use it for their own purposes. Amazon doesn’t have a mapping platform today. Most of the folks in your very large in China don’t have mapping platforms. Facebook doesn’t have a mapping platform. Snapchat didn’t have a mapping platform. You have the only independent mapping platform in the world, which makes a banker very excited.

Eric Gunderson: Right.

Noah Wintroub: Just saying, just saying.

Eric Gunderson: There are three full global data sets in the world. You mentioned Google and Google is a just gorgeous set of data, amazing team. Good APIs, so it’s very easy to put Google map in your app, but like you said, it’s Google’s map. Google pays investing so much on the mapping side because I think it was Morgan Stanley who did the report that came out.

Noah Wintroub: Who?

Eric Gunderson: Yeah, right. 18 months ago saying that Google is doing one point five billion in ad revenue on top of the map and they’re estimating it’s going to be two point two billion just for ads on the map, here’s what’s crazy. The stats they share, 30% of searches on Google Maps, like the app, you go there to those physical brick and mortar locations in 24 hours. 30% of every search is actually getting you, so the people who click through, certified somebody actually saw this ad are now watching you get all the way up to the door. It just shows how fundamental. I want to now give that power to every other company out there and that level of flexibility.

Noah Wintroub: So if you walk away with one thing, recognize that mapping is a horizontal force in the world, is one of the most powerful forces. If you walk away with two things from this panel, walk away that Mapbox is really one of only three independent people in the world who has this information and every second of the day you become more valuable with three hundred million probes out there. Every second that you don’t pay for because you give value to the developers. If you walk away with three things, I think we should do bootstrapping versus fundraising because that’s why people came.

Eric Gunderson: Right.

Noah Wintroub: Let’s start with the bootstrapping. All right, thank you.

Eric Gunderson: Real quick, just give a show of hands, how many are bootstrapping right now.

Noah Wintroub: All right.

Eric Gunderson: Awesome.

Noah Wintroub: How many people are fundraising?

Eric Gunderson: First, yes it really does feel this hard and it’s pretty crazy.

Noah Wintroub: Can you walk through, can you start at the beginning and I want you to tell your Afghanistan story. You’re in Washington DC, you’re like a government contractor, tell us how you bootstrap this thing. It’s incredible.

Eric Gunderson: Met my co-founder while protesting the Iraq war in front of Dick Cheney’s house.

Noah Wintroub: That’s pretty cool to do.

Eric Gunderson: We graduated from school in Washington DC and we were just super idealist.

Noah Wintroub: What did your sign say?

Eric Gunderson: Six thousand one hundred 29 mile slant drill. It had a giant face of Dick Cheney with a straw in the map on it, shocking, over to Iraq.

Noah Wintroub: Were you like the kid who pulled out the Atlas when you were a child? Or like Rand McNally was where you wanted to go visit on vacation?

Eric Gunderson: There’s some dorky pictures. There’s like a circle. We were total idealists. My background was international development and economics. I got out of school and I just wanted to go work. The next thing you know your sitting across the table from folks with World Bank, UN, USA, State, and this is before Mapbox.

Noah Wintroub: You were doing what?

Eric Gunderson: We started a company called Developancy, which is literally partnering with these agencies to help them be more data driven. My frustration in graduating was there really was just a bunch of old men sitting across the table making decisions from their gut, not using any data. I was like, You want to deploy these clinics? How about we actually show these clinics aligned with population centers and be able to show where the spread of malaria is and actually put that in your hand?” Right? It’s not like we were the only people doing geo data and making maps but all the maps at the time were like baked PDFs, you couldn’t explore that. Bit by bit-

Noah Wintroub: Did you have the same vision that drives you today back then? Did you think what-

Eric Gunderson: No, I was just pissed off. I needed better tools to do my job. That was it. Every project, I would take all the money from the project and funnel it back into the product. Literally, I bought Mapbox and the domain name in 2008 and we didn’t take any outside funding until 2013. We just methodically, there’s a couple huge wins. Obviously, now it’s a great story to tell because A, nobody out here does it and B, the cap table is awesome. It was horrible, right? Because we were trying to do two things at once.

Noah Wintroub: Did you not raise money because no one wanted to give you money?

Eric Gunderson: Being east coast is fascinating. I really did not know how it worked. I happened to have a friend, George, who’s out here in the valley, George Hoyum. Threw me in the back of his Prius and literally drove me up and down Sand Hill Road.

Noah Wintroub: To get everybody to say no to you?

Eric Gunderson: We got lucky, oh by the way, most important thing is obviously timing. Team, product, timing, timing, timing. The culture stuff gets sorted routinely and timing. It’s crazy. We were heads down, we were actually against taking VC. We’d seen money flow into smaller companies on the east coast that were doing open source projects and we really thought it tainted their approach. They stopped being so pro-developer. You can imagine why we went with founder group in Colorado. I just like having that technical background, also being in Washington DC, San Francisco is really far away. You actually think everybody out here knows technology, so when I first came out I was like, “Holy shit, most of these DCs have no idea in regards to tech.” It was a bit of a learning curve.

Noah Wintroub: Eric, Eric, remember how this gets paid for.

Eric Gunderson: Yep, so there’s a bit of a learning curve on how we figured this out, so we took every dollar back in and just kept jamming on it. We built this, it was like Photoshop for maps because we needed to work with data internally. If you’re taking a big set of data and making it efficient, you want people to be able to touch it and zoom in on it. Have this level in interactivity, and there just weren’t tools for that. We built that for ourselves and then opened it up. We had no idea how to make money.

Noah Wintroub: What timeframe are we talking about here?

Eric Gunderson: This is 2010.

Noah Wintroub: ’10, okay.

Eric Gunderson: The very first Mapbox map ever shown was from the Afghanistan elections. My first time into Kabul in 2009 was for the Presidential. I landed in, on the map there’s literally Ring Road and Jalalaba Road coming up from down south and the city is an intersection.

Noah Wintroub: Were you raising money there?

Eric Gunderson: The election had happened a couple days earlier and there’s this 2500 page PDF and there’s starting to become rumors that there’s some election fraud and our job was to take that PDF and put it in context. Guess what? A map lets you do that. I got to go into the archives early on, pulled some of the very first half a census that was completed in ’79, digitize a bunch of old Russian maps, land sat and MODIS data from NASA. We estimated where the snow lines would be if there was a runoff in November and who would be disenfranchised. Had these cool ethnic layers where you could overlay the votes on top. Many ways this was like mapping 101, but Ambassador Ichenberry’s looking at our maps. Best of all, they opened the application up at the end. Once the runoff was off. There we are, the world’s first time hearing about Mapbox was by Tim Bernesly at TED in February 2010 where we actually showed the open data site.

Eric Gunderson: That was lucky point number one. So many people started getting it that we got more contracts and because we built the tools we were more efficient, so I basically firm fixed priced everything. One, I didn’t like working hourly because then people could tell me what to do. Two, I wanted to make higher margins, so I plowed all the margins back into the tech. Oh my god, this got unsustainable. One, we never missed payroll, but we came damn close a couple times. I mean, within two hours once. When you’re only working, your friends are the people you end up working with and to visualize what it’s like to not be able to pay the people in the family is, it messes you up a little.

Noah Wintroub: Did your business model change, you’ve obviously changed your business model. You started working with developers, you started charging to license and then you now do a bunch of other services, but how hard was it to shift your model and get paid? I guess the question is, do you think you get paid for the value you create and how do you determine when to do that?

Eric Gunderson: Yeah, so no we don’t get paid for the value we create. It’s much more like, when a developer goes out and is going to build something, they’re going to get a Cloud provider like Amazon. Or if you’re going to use payments, you might use Stripe. Or if you’re going to use notifications, Twilio. If you’re going to use locations, you’re going to pick us. The nice part is, you can pick any kind of piece. Maybe you want a visual map, maybe you only want these layers. Maybe you want to be able to upload your own drone data or upload your own imagery into it. Maybe you just want the satellite map or maybe you just want search happening. Maybe you only want place search. You want directions, you want directions for traffic and then you want to be able to store those routes. We talk about it internally like Lego.

Eric Gunderson: The way we were able to bootstrap, because we needed to stuff for ourselves, I needed one of those Lego blocks on different projects. Over time, we just had this philosophy as a team, solve root problems. That’s just you go lower and lower and lower down in the stack and you end up building a product. The product came out from consulting. The good news about consulting is you stay close enough to your customer, so you really know what’s needed. I was the only sales person at the company for awhile. You’re basically doing product development and sales at the same time.

Noah Wintroub: You decide to raise money, you move out here, you have a couple children in between. Walk us through that period. When did you decide to take money?

Eric Gunderson: Yeah, so we grew it to 35 people profitably. We’d already had Foursquare, USA Today, the NASCAR slot.

Noah Wintroub: I love that, the best logo is USA Today, that’s awesome.

Eric Gunderson: Hey we do 20 million views on election night and near Times is down for 15 minutes. Wall Street Journal, half the map didn’t load and our stuff stayed up. It was little wins like that. You look back on it and you’re just like, “Oh my god, I can’t believe I put enough of these little things together to finally create that.” It was 2014 and the team was so spread thin, it was like, “There is no way we can continue to do this. Basically, you can’t go back mode.” The teams so big you can’t go back to consulting, you’ve built this thing out and you’re running such tight, often known as I was either two or three weeks up on the bank account or two months down on the bank account depending on where the line of credit was standing at the time.

Noah Wintroub: Did banks help you at all?

Eric Gunderson: Oh, don’t even get me started on this one.

Noah Wintroub: I’m not going to, actually, because I work at one and I don’t want to get you started but-

Eric Gunderson: 2009, so the very first repository, code repository for Mapbox has a timestamp on, November 22, 2008 which means it was seven weeks after we met, right?

Noah Wintroub: Yes.

Eric Gunderson: It’s just like, “Guess what happened six months later?” All of our lines of credit were pulled. I was like, “Well, shit. I was just going to use it now.” It was, every year it was hard. Here’s where we started getting super lucky. Ways got bought in July 2013 and all the chatter of ways going from like quarter billion to half billion and the rumors of a price war happening were happening all that Spring. That was a really good time to go raise, because one thing is for sure. People on one hand, investors love the idea that you can go up against a giant, nobody wants to invest in you if you’re competing against Google. It’s just like, now it’s like, “All right-

Noah Wintroub: Is that Google or Amazon Today or is that still Google?

Eric Gunderson: That’s a good question. You were talking about this a couple weeks ago, just a consolidation in the space. I mean, complexity is the new mote. You have very, I think it’s very hard to look at an early stage company and think they can stay independent now given how, are you an actual company or are you a feature?

Noah Wintroub: Yeah.

Eric Gunderson: Our approach was, we’re a platform. We’re going after the entire thing, not just a software component, but we own the underlying data. We had enough logos and there was also one of those things, “Well, hey worse case,” that year Apple bought of their 13 acquisitions, nine of them were GO related. It was an investment that was hard to mess up.

Noah Wintroub: They may have brought the nine wrong ones driving into [inaudible 00:20:28] on your map. Why Apple? Okay, this is for example, Apple is a freaking, they make great products. You build a better map than Apple. I’m betting they spent a few shekels more than you to build their maps. Why did you win and why are they losing?

Eric Gunderson: To be fair, it’s really hard. Apple with all the money in the world, bought some of the best data in the world from TomTom, in this case. It just gives you a sense of how hard it is to do the level of data conflation and get the details right. Honestly get the feedback. The world’s changing constantly. What burned Apple the most on launch was being able to correct what users saw because the stack was rigid. We had transformed into a world, where you have to update the map live. That’s the expectation. It’s a different moment.

Noah Wintroub: That’s where they missed?

Eric Gunderson: Yeah, they didn’t own the data. If you don’t own the data, you don’t have control to update it. The first, the story goes that after launch, they sit down with their data provider. They’re like, “Okay, cool. Here’s all the feedback.” “Great, we’ll get working on this and give you the update in six months.” I mean, that’s what gets Tim Cook to write a letter of apology. It’s hard.

Noah Wintroub: Let me ask the question here because I still don’t think we’ve answered the promise on number three, the bootstrapping piece, but do you think in the early stages, if I think I get you right, having someone that sort of gets it from a technical perspective and an industry perspective is the better investor than someone who has lots of relationships with someone with financial acumen?

Eric Gunderson: If you’re building a technical product, yes. If you need somebody more in the marketing side or you need somebody who knows the consumer space. I mean this notion that investor brings you value can be very true, but you have to be intentional about what you’re looking for.

Noah Wintroub: We went out last year to raise some money and some of these folks that we talked to, I mean I like these people. Don’t get me wrong, but what’s going to happen when Here and TomTom and all these companies, they’re fighting. They’re building an imaginary line of driving freaking cars around while you have three hundred people moving around building your maps for free. No one got that, except for [inaudible 00:22:43] and a few other folks who lost out. Why did you choose to take money from Deep? Now, we’re getting into the fundraising part of it, because that’s not bootstrapping.

Eric Gunderson: This last round was, just to give everybody context. A founder group in October 2013, series A, 10 million.

Noah Wintroub: Did you spend it all?

Eric Gunderson: We were able to triple the company before meeting Randy Gline at DFJ Growth. That was a point, that was a magic moment. We basically spent a year and a half redoing our platform, truly getting it ready to run it mobile because we weren’t collecting data yet. We didn’t get that data pipeline going until series B, so Randy took a hell of a bet on us because if we didn’t get the live update in data we just weren’t going to have the data asset that you ultimately need to have an evaluation. We raised 52 and a half million from DFJ Growth. That’s a tractor trailer load.

Noah Wintroub: Yeah, that’s a lot.

Eric Gunderson: What I always did, was I optimized to have cash on hand. I didn’t try to optimize valuation.

Noah Wintroub: Let’s talk about that because this is the bane of my existence. You optimized for getting the cash, not for valuation?

Eric Gunderson: First for people. I actually took a lesser term sheet from founder group because I liked their team so much.

Noah Wintroub: Did you do that in the later stage where you were raising 52 and a half?

Eric Gunderson: Yeah, no this is where it gets weird. I’m not emotional about cash. I am very emotional about who I work with.

Noah Wintroub: Okay.

Eric Gunderson: I was lucky enough to get, with a more traditional investor, non-technical investor, there’s no way they would have let me do some of the shit that I did for those first early years where then somebody like Randy with a CFO acumen, would actually support. You hop forward to what you saw while we were raising series C was really two different worlds. When I sat down with Masa in Tokyo at the end of the summer, he’s up here at like 50 thousand feet dropping down to five thousand feet back up, talking about how the future of cities are going to be designed. The plethora of sensors, the need for connectivity and data everywhere on the edge in those sensors. It was surreal. There was a time horizon of looking at how the world was changing that I left in awe with you.

Noah Wintroub: Let’s talk about something. If the cost led the teamies on the board, and then you’ve got Masa, who’s at 50 thousand, five thousand, 50 thousand feet. You’ve got the whole soft bank-

Eric Gunderson: The whole bench is amazing, just to be clear. I got introduced to Vicas. On my iPhone, the third picture on my iPhone is in the back of an armorized Land Cruiser in Afghanistan. There are two people in the back. Someone I was working with in the humanitarian space and this other guy, who I don’t remember his name, but he introduced me to Vicas this’s wild how part of it is just showing up. Part of it is why you choose to show up in certain environments and the kind of creed that we had in 2009, 2010, to come full circle to a kind of thinking that I was in awe with watching the vision fund come together was magical.

Eric Gunderson: Vicas dove in and just immediately started asking specific questions. I really like people that have a very fast throughput. Why, why, why? You’re trying to really understand this and I valued that. I met Deep right off the get go. He’s an operation baller. He took LinkedIn as Head of Product, from 30 million to 300 million. Redid their entire server architecture. Before then, grew Google across Southeast Asia and knew the mapping part, so he knew the technical part.

Noah Wintroub: I’m going to get him a t-shirt that says baller. I like that.

Eric Gunderson: He’s amazing, having that operational experience. Then, you know, you set across the table from Regive, it’s just magical. It was like the whole bench coming together here. You were really helpful with those conversations when I was like, “Hold on, there’s a ridiculous amount of money. A lot of ridiculous amount of money.” That was software ground. Having that conversation, do we go to partner with somebody that can truly see more aligned with and how the world’s changing. That, how many times-

Noah Wintroub: A lot.

Eric Gunderson: We set and had a couple of beers, a couple nights.

Noah Wintroub: Eric loves drinking beer. Like me, he loves the macro brews. A good Coors light at work.

Eric Gunderson: It was those, that’s where it gets really personal. You are scared shit, it’s a lot of money, but you’re making a relationship with somebody.

Noah Wintroub: Do you think raising that much money has changed you?

Eric Gunderson: It definitely changes what we can do now. I sound less crazy-

Noah Wintroub: Your plane is a little bigger.

Eric Gunderson: I sound less crazy when I’m talking in front of my team. One of the hardest parts in the early days, it wasn’t just that the investors thought you were full of shit, you hire smart people and at a certain point, they’re just like, “How are you ever going to pull this off?” Now-

Noah Wintroub: Now you have the confidence to do it.

Eric Gunderson: Now, there’s that arch, there’s enough of a runway to do it.

Noah Wintroub: As the most strategic company, I think, out there, why do you stay independent?

Eric Gunderson: Oh, easily. It’s the early days of the space. It’s fundamentally changing. I’m not sure how many people are messing around with AR Kit or AR Core, just the developer system that went from a couple high end tech folks to now anybody with an iPhone 6s and above. I mean there are over 200 million devices that now are AI enabled directly on the sensor piece. Location is a massive part of that. I personally think the AR and VR space is going to be bigger than the browser and bigger than the mobile.

Noah Wintroub: You think that the winner has to be platform diagnostic? If you were to join one of the big platforms, could you still do what you are doing? Amazon has obviously done it with AWS.

Eric Gunderson: You have to, to map the world live, you have to have a horizontal play. The reality is we power better turn by turn directions for car companies because of Snapchat. That is not a logical bridge that many people have believed in in the past, but how sensors are changing and the level of connectivity happening and the high fidelity of data, here’s what’s changing. Let’s be clear. The map up till now, has been designed for you. You’re the interface with the world, right? You need a level of accuracy for you to understand where you are. The person starts being removed, the level of accuracy, the level of detail. The level of real time updates, this is going to get insanely hard.

Noah Wintroub: So mappings the future. In the last few seconds here, any final advice on your journey, what you’ve learned and what you would do, the same or differently and advice?

Eric Gunderson: It’s hard and there’s nobody to talk to so try to find other people going through hard stuff. I happened to meet other founders in the open source space, but their literally nobody knows. For all those hands that went up on the bootstrapping side, it sucks.

Noah Wintroub: That’s really comforting.

Eric Gunderson: Yeah, just keep at it. The most important thing was not getting to the fundraising standpoint. The most important thing was really me finally getting to know myself through that process. That’s been the most transformative. I grew up as and I learned so much about myself over these past seven years. It’s crazy to realize that I might not have known myself if I took easier options out.

Noah Wintroub: What an amazing journey you’ve been on, but what an amazing journey ahead. Eric, thank you very much.

Eric Gunderson: Thank you.

Noah Wintroub: Awesome, thank you.


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