How The Founder of Waze Went From Getting Fired To Building a Billion-Dollar Business | Uri Levine

Harley Finkelstein (00:00):
All right. Let me set the stage here. We are at Washington, DC, at the Kennedy Center, this incredible spot. And we're doing a live recording, a big shot in front of 2,500 people live. We got a chance to sit down with the one and only-

David Segal (00:12):
Uri Levine.

Harley Finkelstein (00:13):
... Uri Levine.

David Segal (00:13):
Founder of Waze.

Harley Finkelstein (00:14):
150 million people a month use Waze. Uri Levine epitomizes grit.

David Segal (00:19):
He does. And what's amazing about Uri Levine is this guy has failed and failed and failed. He got fired twice.

Harley Finkelstein (00:25):
And when we talked to him, we said, "Hey, so you've been fired a couple of times." He's like, "I've been fired many times."

David Segal (00:29):
Yeah.

Harley Finkelstein (00:30):
And he talks about failure as almost like this opportunity to get back up and try it again.

David Segal (00:34):
And yet, when he first launched, 90% of people who used it stopped using it immediately. I mean, he succeeded despite all odds. He is competing against Google.

Harley Finkelstein (00:42):
I know.

David Segal (00:42):
Google's like, "We're going to crush you guys." And he still managed to beat them out.

Harley Finkelstein (00:46):
And then, they ended up buying him.

David Segal (00:47):
And for over a billion dollars.

Harley Finkelstein (00:48):
Yeah.

David Segal (00:48):
You're going to love this interview. Uri takes us right into the room, what it was like to raise money for Waze. He talks about the idea of focus when it's important and when it's actually not that important. We learned a lot on this one.

Harley Finkelstein (00:59):
This was an amazing interview. Ladies and gentlemen, Uri Levine.

MUSIC (01:09):
... from the bottom, now we're here.

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Started from the bottom, now we're here.

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Started from the bottom, now the whole team in.

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Started from the bottom, now we're here.

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Started from the bottom, now the whole team here.

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I done kept it real from the jump.

Harley Finkelstein (01:21):
Before we begin, I want to set the stage a little bit. Show of hands in the room, how many of you have used Waze in the last 30 days?

Uri Levine (01:31):
Thank you.

Harley Finkelstein (01:33):
We're going to get into exactly where it came from, how it was built. We're going to get into all these stories. What you should also know is Uri wrote a book called Fall in Love with the Problem, Not the Solution. And a guy named Steve Wozniak refers to this book as the Bible for entrepreneurs. What you may also not know, is that on a monthly basis, 150 million people use Waze every single month. And this was created by an entrepreneur from Israel who had this incredible idea during Rosh Hashanah in 2006.

David Segal (02:07):
Uri, welcome to Big Shot.

Harley Finkelstein (02:09):
Thank you for being here.

Uri Levine (02:10):
Thank you.

Harley Finkelstein (02:10):
We're going to start where we always start, which is take us back to the Shabbos table. What was it like growing up in the Levine household?

Uri Levine (02:19):
Sorry, can you say that again?

Harley Finkelstein (02:20):
Shabbos dinner table. What was that like, sitting around with your father in particular?

Uri Levine (02:25):
We are a small Jewish family. It's just me and my brother. And we always had a Shabbos dinner every Friday, every Friday for a long while. And by the way, today I'm the one that is carrying the Shabbos dinner. And it was always about what happened this week and what do you think about you're going to do next week. The dialogue was always about what happened and what's next.

David Segal (02:55):
And what's next. One of the things that when we were doing our research on you that I noticed was, I mean you got in a little bit of trouble as a kid, I understand, and your dad seemed to be very encouraging. What did you learn? What can you figure out on your own? He seemed to be ahead of his time with a growth mindset. Talk to us about how that impacted you.

Uri Levine (03:13):
Way ahead of time. Look, and maybe this is, if there is one thing that I would like you to take from tonight is teach your children to fail. Encourage-

Harley Finkelstein (03:26):
How to fail.

Uri Levine (03:28):
Teach them to fail. Encourage them to fail because when they do, then every time that you fail, you get up and you get up stronger. And then one of the things that you learn is that, "Wait a minute, it's okay to fail because I can continue." And that at the end of the day is going to make your children happier because when they fail and they try again and again and again, they will learn how to get out of their comfort zone and way more likely to find what makes them happy. And at the end of the day, there is only one things that we would like to have for our children. We want them to be happy in their own way.

(04:06):
And so my dad was like that. Every time that I would come up with a crazy idea, he was smiling. Later on I realized what this smile meant. And he would tell me, "Why don't you give it a shot?" And he knew it's going to fail. But then the most important part is that there was no judgment after that. And I'm trying to teach that all of my entrepreneurs and all of my children, of course. I need-

Harley Finkelstein (04:31):
I want to ask you about that. I mean, one of the things about your dad that we read about was your dad told you a story about an Italian professor and it talks about prioritization. And when David and I read it, we had a long conversation about it because fairly fundamental to how I think entrepreneurs can build. Can you tell that story?

Uri Levine (04:50):
Yeah. My dad told me this story and I'm pretty sure that it's older than my dad. And the story is about a large conference with many CEOs and many executives. And there is an Italian professor that it's a short guy. And he is standing behind the podium and actually need to reach out behind the podium in order to be seen. And then he grab a glass jar from underneath the podium and put it on the podium and ask if the podium is full or not full. And all the audience say, "It's empty," so no problem.

(05:27):
And then he grab a basket of baseballs and able to fit in maybe three or four baseballs into this jar and ask if the jar is empty or not. Then people say, "No, it's full." And then he said, "Wait a minute." And he bring a box of M&M and pour that into the jar, and obviously they fit between those large baseballs. And then sand and eventually pour water in. And then the jar is actually full.

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And then you ask the people, "So what does it mean for you?" And one from the first is jumping and say, "There's always more room on your agenda for something else." And he look at this guy and say, "No, the baseballs, the big balls are the main things in your life. And then the M&Ms are the one that provides flavors and colors and so forth. And the sand and the water are everything else that is going to take place in your life. If you start with the baseballs, with the main things in your life, everything will fit. But if you start with the little things, the main things will not fit. So go and figure out what are the main things in your life, and then these are the one that you need to focus."

David Segal (06:39):
That's a great story. Uri, I mean, you famously started Waze. Everybody in this room has used it. You had all these failures leading up to it. And then here you are, you have this idea. There's lots of people trying to do it, including Google. Take us back to that first raise. Put us in the room where you have the VCs coming in. You want to raise $12 million and your product's really not ready. So what did you do?

Uri Levine (07:04):
Look, Waze, the magic of Waze is that we crowdsource everything, not just traffic information and speed cams, which is obvious, but also the map data itself. Initially people did not believe that it's going to work. And even though that we showed them a demo, and by the way, the first version was running on a PDA. Remember, long, long, long time ago they were dinosaurs and then PDA and then Nokia phones. And today we all have iPhones and Android.

(07:34):
We tried to pitch that and people did not believe it. The general sense was that this will never work. And then we had constant dialogue with one of the venture capital firms, Vertex in Israel. And eventually one of the partners told me, "Okay, we are going to bring it up to the investment committee and you are going to present to all the partners in the investment committee." And then I asked him, "Can you give me the addresses of all participants in the room?" And once he gave me those addresses, I make sure that the map is actually updated, that their houses are on the map.

Harley Finkelstein (08:12):
Because you knew that they were effectively going to check their own addresses.

Uri Levine (08:15):
Exactly. Exactly.

Harley Finkelstein (08:16):
It's obvious. Even though the rest of the Waze wasn't really working, you knew those investors would check their addresses to see the best route home.

Uri Levine (08:24):
Exactly.

Harley Finkelstein (08:25):
And that was your hack.

Uri Levine (08:26):
Exactly. That was the hack that we used. And sure enough, during the presentation, the general partner or the general manager is asking me, "What you're telling me is that it's possible that my house is on the map?" And I said, "Look, I don't know where you live, but if you'll tell me, then we can find out."

Harley Finkelstein (08:38):
Chutzpah. Chutzpah.

Uri Levine (08:39):
And by the way, it's true, I didn't know which one of the addresses is his. I didn't know where he lives.

David Segal (08:44):
You get the 12 million, but it's not all uphill from there. I mean you guys had 90% churn early on with the product. Then when you go to raise your series B, I believe you had to cut staff. How did you make it go?

Uri Levine (08:58):
Look, I would say that I will describe building a startup as a roller coaster journey, with ups and downs and ups and downs. And if you'll tell me that all the businesses in the world have ups and downs, I agree. But the frequency of those when you're building startups, way higher. I think that the best quote that I heard is that from Ben Horvitz, from Andreessen Horvitz venture capital firm. And he used to be a CEO for startup. And one day he was asked whether or not he was sleeping well at night as a CEO for a startup, said, "Oh, yeah, I slept like a baby. I woke up every two hours and cried."

(09:31):
And that's really the reality. It's a roller coaster journey. It's also a journey of failures. We have the conviction that we know exactly what we are doing, but the reality is that we don't so we try. We try one thing and it doesn't work. We try another thing and it doesn't work. We keep on trying different things until we find one thing that does work.

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Now, if you realize that this is going to be a journey of failure, then there are two immediate conclusions. The first one that if you're afraid to fail, you already fail because you are not going to try. Albert Einstein used to say that if you haven't failed that because you haven't tried new things before. If you are going to try new things, you will fail.

(10:10):
The second one is that you want to fail fast because then you still have plenty of time to try another approach, another attempt, another version of the product and so forth. And you're right, the first version was actually pretty good in Israel, but when we came to the US, that was embarrassing level. That really sucked. People really liked the story. We the drivers are going to fight traffic jams together. And so they downloaded the app. And when they asked route to go to their office, it didn't make any sense so they gave up.

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And then what we did is that we spoke with the drivers, we realized what didn't work for them. We built the next version and the next version and the next version and the next version, more than a year of iterations until we got it right.

Harley Finkelstein (10:52):
Amazing. I want to change gears. I mean this is a condensed version of Big Shot. We don't have too much time. But one thing I do want to talk about is the connection between Jews and entrepreneurship. This is a really amazing stat. And for those of you in the room that are not aware of this, one in every 1,400 people in Israel is an entrepreneur. If you contrast that in all of Europe, it's about one in 20,000. I want to understand from your perspective, the connection between entrepreneurship and Jews. How is it that we are 0.2% of the population, but yet we've had this disproportionate impact on business and entrepreneurship? What is it?

Uri Levine (11:33):
And we can ask the same questions about Nobel Prizes.

Harley Finkelstein (11:37):
Or Nobel Prizes. Exactly. 20% or more.

Uri Levine (11:39):
And so I think that look, there is a desire that is being reflected by Jewish and also by Israelis. And this is about making an impact, make the world a better place. And that creates a lot of people that are actually trying to do that. And so we see a lot of Jewish entrepreneurs in Israel in particular. Part of it is because of the mandatory military service. We know that Israel is in a tough neighborhood and we have to defend ourselves.

(12:11):
When you grow up in a tough neighborhood, you either die or you grew up tough, and I prefer to not to die. And so the military service creates some skills that are later being used in your life that are very, very dramatic. Like loyalty, like never giving up, giving up is not an option. And that is something that is really, really the most important behavior for entrepreneurs. Never give up.

Harley Finkelstein (12:40):
Yeah. Your father famously taught you about the concept of the kibbutz. And in your books, and in a lot of talks you give, you talk about how the connection of the kibbutz community and entrepreneurship are deeply connected. What's the connection for you with those two things?

Uri Levine (13:00):
I think that what was unique about the kibbutz is that you look at other people as well, not just you look at yourself. This is what I need. No, this is what we need. And when you think of we, then there is way more likely that you're going to create higher value, because then you look at community of people, all of your employees. Look, Waze was acquired by Google in 2013, and that was $1.1 billion. And we were very generous with options with equity to all of the employees.

Harley Finkelstein (13:33):
You wanted them to share on the upside.

Uri Levine (13:34):
We wanted to share the upside. And the result is that 75% of the employees became millionaires overnight.

Harley Finkelstein (13:40):
Wow. Wow.

Uri Levine (13:40):
75% overnight.

David Segal (13:43):
Uri, there was a story that struck me early on in Waze. You were offered a million dollars, which was your entire year's revenue to build a trucking route map. And you wanted to focus. But when I looked at your career, I mean it would be hard to call you focused. You've had so many different companies and so many things on the go at any one time. Made me think about the idea of focus. When is focus an advantage and when is it actually a disadvantage? How do you think about that?

Uri Levine (14:14):
Going back to the Italian professor, focus is always an advantage because then you get the stuff that you care about. [inaudible 00:14:20]

David Segal (14:20):
Start with the baseballs, start with the baseballs.

Uri Levine (14:23):
This has ended up to be if you focus on those, then the rest doesn't matter. The rest simply doesn't matter. And it's either going to be working out fine or not, and it still doesn't matter. The focus is on the main thing. The main thing is to keep the main thing the main thing. And that's really hard because in order to do that, you need to say no to everything else.

Harley Finkelstein (14:48):
I want to ask you a little bit about, as we finish up here, I want to talk a little bit about tikkun olam and how you believe it has shaped your career. How this idea of making the world better, of taking care of things around you. I mean, that is not something that most entrepreneurs often think about, but tikkun olam is definitely a part of your entrepreneurial strategy. Why?

Uri Levine (15:14):
Look, number one, I have my philosophy of doing good and doing well. This is a philosophy that I always had. And if it's not doing good or not doing well, then I don't want that. But it goes back into falling in love with the problem and not the solution. At the end of the day, entrepreneur's journey is about value creation. The simplest way to create value is solve a problem. That's the simplest way.

Harley Finkelstein (15:39):
That's it. Yeah.

Uri Levine (15:39):
That's it. Now, when you remain focused on the problem, then what's going to happen is that the problem is going to serve as the North Star of your journey. And when you have a North Star, you're going to make less deviation from the course and increase the likelihood of being successful. But I think that by far the most interesting part is that your story is going to be way more compelling.

(16:01):
If we would have this chapter recorded in 2007 just before I started Waze, then I will tell you I'm going to build an AI crowdsource-based navigation system. Then you're going to say, "Oh, yeah, very interesting." But you don't care. If I tell you I'm going to help you to avoid traffic jams, then you do care. When your customer care, they want you to be successful.

Harley Finkelstein (16:21):
Yeah. Because the solution doesn't actually matter. What matters is what problem are you trying to solve?

Uri Levine (16:25):
Exactly. What is the value for them? People often ask it, when they ask you, "What do you do?" They don't care about what do you do. They care about, what do you do for them.

Harley Finkelstein (16:35):
One last question is we have to finish up here. I mean, all of us in the room, there's this term that comes up over and over again called chutzpah. And I'm curious, what does chutzpah mean to you?

Uri Levine (16:51):
Look, you asked that like it's something unique, but this is how we grew up. Chutzpah is an Israeli approach that we basically say, "I don't really care. If it's ugly, then it's ugly. If it's not ugly, then it's not ugly." Being very, very direct, being very, very specific. And at the same time, don't get no as an answer. Don't get anyone to give you bullshit because you don't really care. And that's chutzpah. They said, "No big deal."

David Segal (17:23):
Yeah. Amazing work. Uri, I can't help think about your incredible career. And I read that your father didn't get a chance to see you make it. What do you think he'd say to you now seeing all your success?

Uri Levine (17:42):
"What's next?"

Harley Finkelstein (17:43):
Do you think that's what he'd say? "What's next?"

Uri Levine (17:44):
He would ask, "What's next?"

Harley Finkelstein (17:46):
Wow.

Uri Levine (17:48):
And to a certain extent, I would say that there is a little bit of my father in me. Obviously stuff that I've learned over the years. And occasionally over the first years after he died, I was asking myself, so what he would be thinking about that? And I think that I'm lucky because I'm an entrepreneur, but also a teacher. And I feel occasionally the biggest reward is that my students or my coach CEOs or my children are telling me, "I wanted to call you but then I realized that I can ask myself, 'What is it that you're going to tell me?' And follow that path."

Harley Finkelstein (18:31):
Amazing. Amazing.

David Segal (18:32):
Amazing. Uri, thank you so much.

Harley Finkelstein (18:33):
Uri, thank you. David and I often talk about that we stand on the shoulders of giants, we stand on the shoulders of giants like Uri Levine. His book is amazing. If you're an entrepreneur in the room, go and read it. And for those of you in the room that like these stories that want to hear more about the greatest Jewish entrepreneurs of the last half century, go check out bigshot.show. It's our labor of love. And thank you very, very much. Thank you.

Uri Levine (18:55):
Thank you.

MUSIC (18:56):
... the whole team here.

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Started from the bottom, now we're here.

Uri Levine (18:57):
Thank you.

MUSIC (18:57):
Started from the bottom, now my whole team here.

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Started from the bottom, now we're here.

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Started-