Founder Dan Sherry and Co-Founder Grace Chi deep dive into Pulsedive, Demystifying Threat Intelligence

0:00 Jon McLachlan

Welcome everyone to the Security Podcast of Silicon Valley. I am here today with two very special guests, Dan Sherry and Grace Chi. Dan Sherry, he is the founder and CEO of Pulsedive, a security startup. Dan has years of experience doing incident response, security engineering, and security operations across both government and Fortune 500 financial services. He is all too familiar with the struggles of filtering noise from open source threat intelligence and sees Pulsedive as the first step to solving this problem. And Grace is co-founder and COO of Pulsedive. Grace works closely with defense, security, and in particular cyber threat intelligence teams to support and the development of integrated intelligence capabilities and programs. In addition to enabling the growth of CTI teams all over the world, Grace is an avid watercolorist on the weekends and a hyper-serious cooperative board gamer. What's your favorite board game?

1:02 Grace Chi

I have many, but the more stressful and the bigger headaches it gives me, the more I like it. So XCOM has been one of my favorites. Not the video game, the board game.

1:11 Jon McLachlan

That's awesome. That's, that sounds really stressful, actually.

1:15 Grace Chi

There's timers that range from like five to 15 seconds to do a bunch of tasks, and everybody is like contingent on each other because you have a budget, you have a military, and you're fighting aliens who are invading the world and descending upon you. There's like a tense music background that plays too. And it is like, why do I do this to myself? But it's also so much fun. And you still feel competitive because you have this shared enemy. Unlike cooperative games, where sometimes people talk too much, you don't have that time. You just have to make decisions and move forward. So it's like being in a startup.

1:48 Jon McLachlan

I'm super happy that you have a decompression mechanism that works best for you. And I might pass on any board game invitations, but no, she comes from a deeply unconventional and [interdisciplinary] background, including academic studies in neuropsychology, product marketing roles, and a lifelong affinity for mixed media and visual arts. Grace draws on her multidisciplinary love of learning to enrich her work and place in the cybersecurity community. Welcome. Welcome to the show, guys. Great to have you back.

2:19 Dan Sherry

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2:20 Jon McLachlan

Would you like to share a little bit about what Pulsedive is and the problem space?

2:25 Grace Chi

In short, Pulsedive, we are a cyber threat intelligence startup. We offer both platform and data, and our users are vast majority like blue team defensive security, security operations center, incident response, threat hunting type practitioners in the cyberspace. But it is global, you know, every continent except Antarctica right now, and teams small and large, both within the dedicated cyber services and vendor space, as well as institutions and enterprises. What we offer is enrichment, kind of external scanning and scoring of various indicators of compromise. And then we correlate all that within different threats, different threat actors, and allow our users to really access like transparent, raw, but structured data, pivot, and bring that in so that it helps them in their investigation, research, and analysis in producing finished intelligence. One major component that we have as well is that we try to be very versatile technically and very intuitive for the UI and the analyst. So while we have users who are engaging in a more manual way or conducting very sophisticated research based on their expertise and their understanding of their threat environment, we also allow for a ton of automation and interoperability across other tools and solutions, because the security space changes all the time. So that you can really plug and play Pulsedive through API, through feed, and get our intelligence and our enrichment however you need it.

3:59 Jon McLachlan

No, that sounds very powerful, especially the opportunity to automate a lot of those processes. So as a quick example of how you might help, I know one of the huge challenges that folks face is just making sure that those layers of security that we set up don't allow for bad actors into our cloud environments or even our data centers if you're on-prem. So Pulsedive essentially, it fingerprints or scans the network for the traffic that's known to have mal-intentions. Is that

4:34 Grace Chi

Mal-intent. I like that. Yeah. So we offer a portfolio of products and offerings. So like at the most basic level, we have a freemium community tier. Anyone can use it. You don't even have to register. Like you can go in and conduct some passive or active scans, pull back data, and then never even have an account with us. And we do that very intentionally. Those users are typically who are getting started in threat intelligence. Oftentimes we have a lot of grateful users who are IT, but also have to wear the security hat, but they have no budget, they have no resources, and they need to do some manual research and triage based on their team needs, and they're trying to grow. At a more mature level, where you might be paying for the commercial API or the feed licenses with Pulsedive, that's when you can automate enrichment based on things coming from your [SIEM] or building into a workflow for your [SOAR]. So there's like IPs, domains, URLs that are coming through. You push it to Pulsedive, scan, pull all that data back, take actions, look at the score, you know, whatever that is, where you can bulk enrich alerts that come in as well. And then at the highest level, too, we offer an enterprise tier where you get to configure really your version of Pulsedive. It is your instance. It is private to everyone except your organization. You get to really then look at what threats matter to you, configure your own sources of data, internal and external, and then use Pulsedive as that like data analytics and threat intelligence database layer to then operate and have that feed into your integrated program.

6:08 Jon McLachlan

Yeah, that's really important stuff. And a complex space, keeping our bad actors out of our cloud environments or our on-prem, especially with that enterprise-grade offering that you have. It sounds like it fits the bill really nicely. So being in the security space, oftentimes I find, especially with founders, that goes, it ties into something maybe from childhood that really shaped who you are, how you see the world, and giving back to the security community in such a concrete way, especially with that free tier. It sounds like a great starting point for a lot of folks. But maybe there's a story or something that you'd like to share that really speaks to what gave you maybe some of these values to look at this difficult problem and take a lot of time out of your life to help solve it and build a more secure future for everyone.

6:56 Dan Sherry

Yeah, I mean, I think like when I was in college, that was around the time that like Facebook was like getting huge and when The Social Network came out. And so for a long time I wanted to, I knew I wanted to start a company and try to be one of those overnight founders. And so I'd have like these apps that I would make in college to try and build a business around while I was studying cybersecurity. When it started working, the job itself was really fulfilling. So I knew I kind of wanted to do something within cybersecurity, because it was not only the opportunity to build a business around that, but also something that actually did important work. And so when I was working, I mean, that was kind of when I ran into the problem of like, okay, we're collecting a bunch of data. How do we leverage all that so we're not hunting for the same things that people already know about? And so that problem was, I mean, it was like the perfect candidate to build a business around that. It was something I was really passionate about. I really like building things that help other people and make their jobs and lives easier. And so that's kind of how Pulsedive was formed.

7:55 Jon McLachlan

No, that's spectacular. Really awesome. So your focus and your passion really zoomed in on security and then how to use it to help people.

8:03 Dan Sherry

Yeah, yeah. Yeah, I mean, I was lucky because the things I were passionate about coincided with like a booming industry. So when I first started working in the industry, it was like 2013. So that was really when it was starting to grow exponentially. And then over the past decade, the industry really exploded. Like threat hunting was relatively like a new field, for example. So yeah, I was lucky to be like on the [cusp] of that.

8:28 Jon McLachlan

That's awesome. And Grace, do you have any childhood experiences that, it sounds like you're a very diverse background?

8:37 Grace Chi

Yeah, so like my childhood, like I, one thing that I think is really fun about [Pulsedive] is Dan has the traditional like security engineering, incident response, like working on threat intelligence as a practitioner for multiple years, built the product, right, that he wanted to use. And then like I come in as this [complementary], completely out of the like right field person. But that's been something that's been building my whole life. Like when I was young, and a lot of times I feel like in the American education system and just in general, like it's easy to try to box yourself into one role or do one thing, but I was just full of these like weird dichotomies where I was like, I don't fit in, I'm okay with it. But like, for example, I was like, I got like most artistic in high school, like in the yearbook. But then when I went to art school, like, I hate it here. I don't want to do this. And usually if you do art, you want to get a career in art. Okay. And then I loved academia. So when I was in college, I took on these double majors that were teaching me how to think for the sake of thinking, not going for the more traditional, like, what job do I want with this major? But then at the same time, like, I love business. And I also love volunteering and giving things back to the community, but then also growing a business and making money and commercializing, which is why I ended up in marketing, because this is a great way to balance and learn about how businesses grow and work directly with a lot of leadership, because it's so critical. And so my entire life, I would find these weird opportunities, not because I had applied to the traditional openings or whatever, but [I'd walk] into a museum and be like, I want to volunteer here just because, I don't know, I like art history, I'm studying art history. And then that would turn into a job. Or I would like tutor, or I would volunteer at Chinese school, for example. And then the parents would come to me and be like, can you be a private tutor? And I'm like, oh, okay. So my whole life, I just saw that there was a lot of opportunities and hidden places, and that they don't have to fit within what you've been necessarily building your whole career or persona out to be. And I think that's why I love being in cyber, because I don't have that traditional background that's so critical, but that there's so much that can be applied and help enrich like the entire community, the entire industry with outside perspectives. And that's thinking about it from a marketing perspective, thinking about it from a human perspective. Technology is so important, but it really fits within processes and people. And I think sometimes in the past, security, like they push just the technology without the operationalization or without the right skilled staff, right, to meet up with it. You know, I try to balance that out and look at that and apply those kind of learnings, both from science and art history and liberal arts and marketing, into the field at large.

11:23 Jon McLachlan

Wow, that's spectacular. It sounds like you both complement each other very well, which is really important in a startup. Got to hit the ground running, and everyone is a clone of each other, then you're kind of preaching to the choir all the time, and the company won't be as resilient as it could be if you had a nice, diverse team. And it sounds like you both bring so much different experiences to the table. So nice job. Would you like to share one truth that you see with the world that most people tend to miss?

11:52 Grace Chi

It's funny because I had thought of some earlier, but now I'm [like] none of them sound that good. Dan, do you have anything?

11:58 Dan Sherry

Yeah, I mean, when I'm looking at our industry, I think that the industry tries to move towards this, building the newest and like latest and greatest technologies, but we haven't really nailed the foundation yet. I feel like there's an opportunity to take a step back and try to smooth over a lot of those [basic processes] that a lot of small [and medium-size] businesses are struggling with. [...] like a lot of these new ideas that we haven't really seen before. And like [investors are] trying to invest, they want to look for new ideas that haven't been tried.

12:29 Jon McLachlan

Right. They want to take risks.

12:32 Dan Sherry

Yeah, right. But there's a lot to do with innovating or changing existing ideas or improving them. And actually, I remember reading a while ago that, according to research, the most successful companies are actually iterations over previous ideas versus ideas that are completely new. So I think there's a lot of opportunity there.

12:49 Jon McLachlan

I see what you mean. Innovation is very often taking ideas that already exist and making them more accessible, sharing them with a wider audience, removing barriers to entry. [I mean,] to innovate doesn't require that much risk taking. You just put together what you've noticed already works, works well, and you can make it available and accepted across the entire world to help change things for the better. No, I get that entirely, Dan.

13:18 Dan Sherry

Yes, yeah, [I'll just add,] like when you're iterating over existing ideas, you know, it's not a new sell to new customers, that they're already familiar with that type of solution. So it's actually easier, like, it's easier to enter markets that way too.

13:37 Jon McLachlan

Right, because what you're selling is already connected to what they expect to build or to find out there. And you're just doing a lot of that manual work for them, stitching it together in a way that adds value more quickly. Awesome. Was it your experiences in the industry that led you to see this?

13:57 Dan Sherry

You go to like meetups and you talk with a lot of people that are in, that are like also engineers or responders, and they're struggling with the same problems that you are. And there are problems that are like, you know, shouldn't this have been solved? Like, we see all these new companies coming out, it's like, shouldn't more people be trying to address the problems for organizations that aren't as mature or who have like a smaller budget? So yeah, I guess that's where it was, just sharing the frustration with other engineers who are trying to automate and support these vendor solutions, or [incident] responders who are really just trying to understand if something is a false positive or [if they should dig deeper]. So just those frustrations that, okay, maybe we need to take a step back, if understanding these problems better, it's a better way to solve them.

14:47 Jon McLachlan

Yeah, that makes total sense. And they're lucky to have someone like you lead the charge and notice this and sit down and think through the bigger picture, take a step back and really help everyone build a more secure future. Because really, at the end of the day, everyone that has a cloud environment has responsibility to help protect those systems that are up there in the cloud, or data. Same thing, you have responsibility to protect the data that's up there in the cloud too. And if things are priced out of reach or too complex to be used by the smaller markets, the SMB markets, or even fellow startups, then there's going to be huge gaps in the market. So inviting everyone to have a place at the security table with that free tier that you guys have, very admirable. And it'll take a lot of the market share that way, too.

15:39 Grace Chi

Right. The, yeah, that accessibility is important. And I think one thing the industry is changing a little bit, and I know it's like not easy, but another truth that started with [Pulsedive], maybe not in the earliest stages, but shortly after there was a free community tier, is the ability to share intelligence. Because when threat intel hit the market, it was a little bit convoluted. Like everyone wanted lots of feeds, feeds were coming out. They come in the dozens, if not thousands, right, at this point. And no one can really truly benchmark the quality, the efficacy, the relevancy of various lists of IOCs. And what that resulted in is every organization has threat intelligence, even if they don't have threat intelligence. If their intel lives in emails or blog posts like that they're linking to each other, that's what it is. And it's not great. But being able to create venues in which multiple users can share intelligence, add commentary, submit things for other users makes it so that it's not like every SMB that has like very limited resources and also lack of like expertise and understanding, they're not living as individual troops trying to fight this very large, growing, and evolving enemy, multiple enemies, but that you can start bringing it together and working as a united front. I know that there's a ton of trust groups, and there's also coalitions, there's public-private partnerships. So there is a lot of work being done, but at this point, it's still quite disjointed, and it's really hard to keep up. So Pulsedive is looking to be at least one niche of that space that's trying to help each other, ourselves, communities, individuals, [hobbyists], and obviously organizations in bringing this threat intelligence together.

17:22 Jon McLachlan

So there's a strong sense of community amongst everyone, and you're all in the same boat together, benefit from each other's knowledge. How do you incentivize folks to give back into the community?

17:35 Grace Chi

Offering free things is a really great way to make it like giving value before asking for anything is, is a fantastic, awesome way to give first.

17:44 Jon McLachlan

So the community can give first. And then if you give back, it just continues to pass that love forward.

17:51 Grace Chi

In a lot of ways, yes. The other challenge that we have, though, is that you want people to contribute, but you also want to protect them. So we have a lot of safeguards in place where you don't actually know who it is, or it's a username, or they can do their intel research without submitting and sharing that information with the actual community if it's sensitive. So we're always like trying to toe the line of like you opt in to share, not you're forced to share. But Dan, as far as your early, I guess your early story on giving a little bit, getting back, and then building Pulsedive to like V2 and V3, what would you say was like a major turning point that a community started to evolve?

18:31 Dan Sherry

Yeah, well, in the beginning, it was going to, it was supposed to be like an enterprise platform to compete with a lot of the other ones that were coming out at the time. But when you're trying to get people to look at it, [you need the data in it,] so they can kind of understand what the platform does. So I started working on putting data in the platform and, you know, try to show people. But, you know, people didn't want to go to some login screen to try to discover something that they don't really know that they need or that they want. So I started making a lot of stuff accessible for free without an account, to try and lower the barrier to entry. And then people were more interested in using the platform and the data. And so that's how we saw this opportunity with a lot of people who are finding value in just the [community tier] and just the data. And they're willing to pay for the data. So it seemed like the right way to go. And so we actually discontinued the enterprise [tier] for a while. And for the past probably year or so, we have been [ramping] that up again, because we're at a point where now the value of [Pulsedive] has been proven. So people want this, people want that value within their environment. [As far as] like getting people to contribute, you'd actually be surprised at like the amount of people who just want to help smaller organizations or who want to put their data out there so that people can use it. I mean, there's so many open source projects and repositories, but yeah, I mean, it's great to mention like a lot of it pretty disjointed. [So I think] you do want to provide some value to solve their problem, but I think they just want reassurance that you're also willing to provide this data and make it accessible for other organizations, and that you're good, that you have the flexibility to support those types of data sets, and then you're going to be around for a while. Because if they're submitting a lot of data to this platform, they want to know that like, okay, people can actually use it. I'm not wasting my time submitting to like a startup that's going to [fold], and you're able to accurately represent the data that I have so that people can use it in the way it's meant to be used. So yeah, I think a lot of people are willing to contribute with the right tools.

20:44 Grace Chi

And in addition to contributing, so like when we talk about contributing, and I think what Dan's thinking about is like sharing data, submitting IOCs, IPs, URLs, associating with threats, adding comments with blogs, the other way that they contribute, and I will be frank, I was surprised, was like, obviously, feedback for the community tier. People want it because they know that that's going to benefit them. They provide user input, complaints, what they love about it. So when we conduct that user feedback, it's great. When we were doing research into the Pro tier, which had launched a year ago, users are also really excited. And it was like, I asked maybe 30 people that I somehow knew or didn't know, that used or didn't use Pulsedive, and they were all willing to hop on the phone because they know that even if this is a paid product, we're trying to be affordable, we're trying to meet like a specific segment that there's a gap for. And that, you know, even if they were not fans of the community platform, that they wanted, they supported our vision, they supported our effort. And I did not expect people to want to help, you know, like provide input for a paid product. And that helped, and that made our product much better. It made people see the value. And you know, we had like a great Black Friday because of it. So it's, the community is so open and great. And if you contribute to it, they give back in [droves].

22:07 Jon McLachlan

It sounds like you're doing a great job of building that community and building a sense of, you know, we're all in this together. If you give, then the community will always be giving back to you as well, and set up a situation where people could feel like they're part of something bigger. That's really what you want in a community, right? I've also heard, I think it was actually from a VC that mentioned this, that if you don't have community, then eventually you just become commoditized and you'll be like any other product. And you know, a Kleenex is a Kleenex, no matter what the brand is. But if you have a strong sense of community, then there's always going to be that that can help drive forward your brand recognition. And not that your brand recognition is going to be synonymous with the community, but that there'll always be a group of people. Because at the end of the day, that's, I think, that's what all of this stuff is about, and that's why we do this. [Those] people that we're trying to help, like in a very concrete and tangible sense. So if there's a gathering space for that group, and you can form a sense of community around other people that are struggling with the same things, then now you have a very long and lasting brand.

23:20 Grace Chi

Right. And when we're this early, like us as people, like we're very different, but we are very much part of that brand too. So we participate in the community and things that we enjoy. We lean into our strengths. And as part of the, instead of like collateral damage, it's like the collateral benefit is we talk to thousands of CTI teams. We've helped people get placed in jobs just because we know people both hiring and job seeking. And that's really important. And we help advocate for, you know, diverse and new talent coming in. And that is just part of the culture we have, because we want a great product, but to be a great product, you have to understand the market. And to understand the market, you have to participate in the market. And that's where we are now.

23:59 Dan Sherry

No, that's exactly what I was [going] to say, that you need the community, but you also need to be a part of that community to make sure that you're looking [out for it].

24:07 Jon McLachlan

Yeah, great. Yeah, exactly. So tell me about the best day that you've had at Pulsedive. What was that day like, and why?

24:17 Grace Chi

So I'm on the COO side. So I'm always like looking at measurements and operations. Where are we focusing? And so whenever we have QBRs, so quarterly business reviews, in which I'm just wading through a lot of data and then putting things down, it always feels like such a grind. But then you look and you sit down and you measure the change quarter over quarter or year over year. And when you're living in a small startup where every day is chaos, you're trying to learn something new, there's new problems, you feel like you can never keep up, you feel like you don't make that much progress. But then you sit there and you talk, and it's like a really long meeting we have every quarter, where you're like, wow, look at who our customers are, look at who's been signing up, look at how they've been using us, look at what we succeeded in and also didn't expect. You know, there's not a specific quarter that I would say was the absolute best, but taking that time just to like really sit down and like look back and then also plan forward has kept us, or at least me, Dan, you can tell me if you agree or not, very aligned and interested in seeing the value of what we're doing.

25:18 Dan Sherry

Yeah, yeah, I totally agree. I mean, it's really [exciting] to see it grow from like the vision that I had, like working nights and weekends, like, you know, years ago. It's just wild.

25:30 Grace Chi

Working nights and weekends now and during the day.

25:34 Dan Sherry

Yeah, yeah, I guess [that's true]. I like, I guess I'm still on that schedule, but because I'm not doing like nine to five like I used to, [I can sleep in]. But yeah, I mean, it was definitely like the first [big sale] that we had a couple years ago, when I was still on my own, that was when I was like, wow, like, [I can do this.] Like, this is like a viable business model.

26:01 Jon McLachlan

Yeah, yeah. How long, how long did it take to make your first sale?

26:05 Dan Sherry

For like the first [serious] sale, it probably took about a year. I mean, it was a while of just building the product. But I mean, building the product wasn't even the [hard] part of it. It was [getting people] [...] and then getting feedback and making sure that we were offering something that like provided enough value where people could justify a line item budget for it. So that, yeah, it took a while. I was just doing sales and [business] development and

26:35 Jon McLachlan

Yeah. But you cracked the code and you made, you close the deal. Yeah. And how long ago was that? Like a couple years?

26:46 Dan Sherry

Yeah, it was a couple years ago. That was like four, three, four years [ago].

26:55 Jon McLachlan

And was that sort of like the thing that tipped you over the line? And did you leave your day job at that point? Or because I know you mentioned this was a passion project in the very beginning, but

27:09 Dan Sherry

And that was a year after, after I was on my own.

27:13 Jon McLachlan

Oh, so you were already full time, and that year passed, and you have kind of like still in experimentation mode.

27:24 Dan Sherry

So if you're going to ask like what the worst [time] was, it was like that first year when I was like out of money, basically. And when I realized, like, okay, I need to probably start working again. So I started contracting. And it was actually like right when I started contracting when someone came out of the blue and were like, hey, we're interested in your highest tier. You know, can you send us an invoice? And so that, it was, yeah, that year was just a roller coaster.

27:51 Jon McLachlan

Wow, that's spectacular. They just showed up out of the [blue] and was like, can you send me an invoice? That's unheard of.

28:00 Dan Sherry

Yeah, yeah. Yeah, because they're like, oh, we're interested in the feed. And I thought it was like probably a small, like one of the lower tiers. And they're like, no, yeah, we want the [highest] tier, we're ready to purchase.

28:12 Jon McLachlan

That's pretty exciting.

28:13 Grace Chi

Yeah. Just to, just to add to that, like, that, like, who are these people who reach out to us? That happens all the time. And that's only because we have, one, no like outbound sales process. We don't do paid advertising, right? Like we're not really tracking specific like users either. We just let people use what they want, but then you penetrated the market, and we have some visibility, or at least we understand what our users are thinking. But so often something will come in and they'll be like, can you give us an invoice for this and that package? Blah, blah, blah. I'm like, Dan, have you ever talked to these people? And he's like, no, don't you know who they are? I'm like, no. We're like, cool, all right. [Like, working on that invoice now.]

28:47 Jon McLachlan

That's awesome. Do you ever ask how people learn about you then?

28:51 Grace Chi

Every time. Like every time.

28:53 Jon McLachlan

And so what do they tend to say?

28:54 Grace Chi

A lot of people had used Pulsedive before and they liked it. They thought, we hear like, oh, the interface is great, or oh, I could set up the API really easily. And you know, the way the security industry works, people are jumping around all the time, and then they share, you know, news, and then they bring it to their new companies, right? Other ones, like sometimes Pulsedive's listed in like an internal wiki for like, oh, if you're doing threat intel enrichment or research, use this tool. So then new junior analysts come to us. And then other times, like for some of our larger [prospects], it's because in all those secret dark alleyways on Slack and Discord, they put out an ask and it's just all warm referrals. And we've never heard these people, but somebody who we work closely with, who's a big advocate, will be like, oh, check out Pulsedive. And that's where they come from. So it's all really organic and kind of like grassroots, which we like a lot.

29:47 Jon McLachlan

So you're bootstrapped. You have viral grassroots. I'm sure everyone that's listening to this podcast that's a VC is wondering, are you going to be raising? Are you going to like throw fuel on the fire and really grow an exponential rate and do that hockey stick thing?

30:04 Grace Chi

Oh yeah, the hockey stick that every startup says they can do. One thing I wanted to add actually to, which has enriched Pulsedive a lot, but comes from having this community, and we're so lucky, is that integrations are the name of the game. You have to integrate every tool with every tool. And our users are often the ones who start it off, like who will reach out to a tool being like, I want a Pulsedive integration, or go out of their way and make their own community marketplace integration. And that in and of itself has built and given us like almost like development capability that didn't come from us, but because they know they could use it out of the box, because they have the value, because they have that expertise and they're trying to solve this problem for their own company, they bring it back to us. And then of course, you know, we thank them, we provide, you know, whatever kind of, not compensation, but deals, discounts, and just keep it going like that.

30:52 Jon McLachlan

[Do you] have like an open source GitHub with the integrations that are all open source, or

30:57 Grace Chi

It's our API documentation.

30:59 Jon McLachlan

It's your API documentation. Okay.

31:04 Grace Chi

And Dan's happy because he can just answer some quick questions, and then it just magically appears. And then we get new customers because they found, you know, this SOAR integration or that SOAR integration in this other tool. Yeah, it's the best when we get development efforts that are not, that we didn't even know existed until it's like published and people are coming to us using it.

31:25 Jon McLachlan

Yeah, that's amazing. And so you don't, you don't have to spend money on marketing. It's all word of mouth, and it sounds like it's growing very rapidly, and you're just expanding and using the help from the community to expand into different tools, different markets. I guess as you integrate those different tools, you're actually opening up new markets for yourselves too.

31:42 Grace Chi

Different use cases, too. Like when we talk about good days, when we launched Pro, you know, we do discovery, we do user research, we try to prepare ourselves for the most successful version of this product that we can build. But then they come back and people will be like, I found funkiness. We're like, great, that's perfect. You know, they're like the single security person, and there was a detection, or, you know, something, however they use Pulsedive, help them protect their company. That's the end goal, right? So a lot of times typical use cases, security operations or just like doing research, they find funkiness, they pivot. Awesome, right? That's what we want to hear. And people don't always tell us, but when they do, it's like, we always have, we have a feel-good channel in Slack that's private, where we just send kind of feedback to each other and keep us motivated. But then we get like these like super users who don't come from a traditional use case. Maybe they're like red teaming and they're doing recon, or they're doing like vendor evaluation and they're doing technical due diligence. And they help us when they come to us being like, oh, have you thought about this feature? We're like, why? Why do you, you know, what are you doing? And they tell us, and they're using [Pulsedive] in ways we didn't even dive into. Like, sure, we know there's a lot of applications, we're sitting on a ton of data and we process, but they are the ones that are basically guiding us into new markets to test, to do research, to validate, to add functionality as well.

33:00 Jon McLachlan

What's the most surprising ask that you've had?

33:04 Grace Chi

Ooh, surprising ask. Dan, do you have that?

33:06 Dan Sherry

[Surprising?]

33:08 Grace Chi

Not so much mind blown, but like a lot of users that were like, oh, we're surprised that you can look at this tool that's really optimized for like security operations teams. They come in, they do like anti-money laundering, fraud prevention or fraud detection, or once again, like third-party evaluation of tools, where like we see that that makes sense, but [you're not designed for it].

33:29 Jon McLachlan

Do you ever get a little suspicious when you figure out or you hear that a red team person is using your tool? Maybe they're using it to try to cover their tracks, to see if what they're about to do is going to be detectable, or

33:41 Dan Sherry

I see that like a lot of red team people use us for kind of like that threat intel background, or like when they [do] pen tests and stuff like that.

33:49 Jon McLachlan

Like initial scan. Like, hey, let's see what our starting point is, our baseline.

33:57 Dan Sherry

Yeah, or if like we'll show information, like if there are IOCs that [have] been seen on [feeds]. So if there's like, you know, maybe a company asset that was seen on one of our feeds or that somebody submitted or something like that. So I think it's those two use cases are pretty much aligned.

34:12 Jon McLachlan

Great. Okay. Nice. Okay, so what about the worst day at [Pulsedive]? You had like a just a horrible, a horrible day, and for whatever reason.

34:26 Grace Chi

My not one-day answer was like, it was a slow, like, dreading [...], but like when the pandemic hit, all budgets were frozen, right? Like [threat intel] was a great field to be in. We did not see any dip. Actually, we probably saw an increase in user from free users. And everything that was about to be purchased, or, you know, no one knew what was going on, from like basically end of Q1 through end of Q2. So everything was closed, nobody was hiring, nobody was [...], everyone was trying to hunker down and see what happens. So we were like sitting there like counting out, Dan and I were sitting there like counting out our runway and like counting out what expenses we can cut and making sure that we could really last. And we were in a decent position, but once again, bootstrapped. So it's not like sitting on $5 million cash. And so when that finally did lift, and we were actually able to like [four or five X our] revenue for the year, because Q3 and Q4 really recovered, and cybersecurity as an industry is just booming, it was a major relief. So that's really six months of a low humming bad day.

35:28 Jon McLachlan

That counts as [many days]. Six months of a bad day. Wow, that's quite the bad day.

35:34 Grace Chi

It was still like sales and leads. It was just like everything got dampened.

35:39 Jon McLachlan

Right. And we hear that a lot across the industry, especially with startups, for 2020. Yeah, I think the pandemic really hit everybody. What about you, Dan?

35:50 Dan Sherry

Maybe the same. Yeah, I mean, [pretty much] the same. I mean, it's also like I said earlier, that first year, that was really tough, thinking about reaching out to people and being like, hey, like, do you have any opening specifically for this, for this type of work? I think for me, that was really hard, because when you come into a startup, like you definitely do it confidently, right? Because you have like this new idea, and like the early feedback [is good], and you know, you have a couple people who are asking you about some of your products. But when you just [keep] doing it for so long, and you haven't gotten those initial sales yet, it's just really tough to be like, okay, I got to [...]. Because like you can still [...] [nights] and weekends, but it's kind of like taking a big step back. But I mean, luckily, now we're in like a great place. So it was hard back then, but [...].

36:48 Jon McLachlan

So yeah, just not getting the feedback that you want from the marketplace by not being able to close the [sale] [...]. Yeah, that could be a tough spot to be put in, especially because your heart is in the right place and you're pursuing your passions. But if the market doesn't respond quickly, you know.

37:06 Dan Sherry

Yeah, [I saw a tweet] today that like really resonated, and it was something like: failure is the default, and it's really the resilience and fighting that failure like every day eventually would get you to a better place. So yeah, that definitely, yeah, that's where we, we hit that first year. Yeah, but I mean, it's like when you're first starting out, and you know, again, you're [waiting] for that first sale, it's like, just with extra disappointment, because you don't know what to expect, right? You're new to the side of things where you're selling to people. So it's really just like just finding [ways] to keep going. And especially when you're bootstrapped and you're [...] you run out of your savings, but you still have opportunities, and like you don't have to, like when I was in my own, I didn't have to let anyone go, right?

37:51 Jon McLachlan

Sounds like you have true grit and you really pulled through. And now all of that's going to be paying off for you here and in the future too. So when we do look into the future, I'll leave it up to you of how far you want to look into the future, but tell me about what the next milestone of success looks like for Pulsedive.

38:12 Grace Chi

I'll take a first step and then Dan can add to it. In the short term, like any nice startup, you know, we want to make sure we're not churning customers, that they're either, you know, it was called being retained or upselling, which is something we've also witnessed. We kind of have this nice ladder where there's free and then there's individual pro and then there's data subscriptions and then there's a full platform. And we have some users who are just like bouncing their way up the ladder, which is exactly a validation of how we [position] and how we are in the market with these products. So 100% keeping users satisfied, having them continue that referral, that word of mouth. And then in addition, being able to have a voice and like create, I don't want to say thought leadership because everyone, you know, so [hackneyed], but being able to take and utilize this research, all this data we're sitting on, the communities that we're building, and then more meaningfully, more intentionally contributing to the future of the industry as well. And with that, it comes with like working closely with enterprise-level users, with communities, with programs, profit and nonprofit types. And then in the medium long term, it's building out that community [forum] functionality, where individual users might be able to, and this is all like, you know, kind of on the vision, but we haven't committed, we haven't put a timeline to it yet.

39:36 Jon McLachlan

Sure.

39:36 Grace Chi

Sharing their intelligence with specific user groups or trust groups, having that Pulsedive be a platform that [...] users can work with each other or across organizations as well. And Dan, I know you have some more thoughts regarding how that would look within the platform technically and people-wise.

39:58 Dan Sherry

For what, for what part?

39:59 Grace Chi

The like supporting the cybersecurity and the threat intelligence community within the [Pulsedive] product, with their own feeds, with their own data, their own research.

40:10 Dan Sherry

Yeah. [...] is like, you know, we've talked before about having people contribute, but we want to be that place where like, you know, people can publish interesting research and stand up their own feed, and yet contribute in like a much more automated way, and really grow that community.

40:29 Jon McLachlan

Okay, so your vision of success is when you step into an elevator, and there's two engineers already in the elevator, and they're arguing about how to grab the best and latest data for threat intelligence. And then finally, one turns to the other and says, oh, let's just be done with it and use Pulsedive.

40:51 Grace Chi

We'll use that story. Yeah, when [we, oh,] we'll come back to you when that happens to us. You know, it's, it is fun because like when I started, and this was two years ago, when I joined Dan, two years, I think two years into his experience, and it was growing beyond just him, and then he invited me in because I have a very different way of looking at the world and things that I enjoy and strengths. We were sitting at a BSides DC conference, and this was the last one before like COVID hit and all the BSides were canceled, like in [person] [...]. And we're like sitting there, like listening to some research. And I don't know where, like Pulsedive shows up on the screen. And we're like, what? Like, oh, we've never, we don't know this guy. And we're like, that's awesome. And that kept happening. And we're like, it is so motivating, because we're living, you know, a lot of days, we're coding, we're working on the business. We don't get like, we see the user activity, but we don't see the impact necessarily. And then when we put ourselves in the community, even not trying to sell, just attending to learn about things in security, like we see our name, and we're like, wow, that's, wow, that's really spectacular.

41:49 Jon McLachlan

So you just haven't gotten into the right elevator yet, then.

41:53 Grace Chi

Exactly. And like some forums, like sometimes if I just like [Google] Pulsedive and [...], and they'll, people will be like, oh, Pulsedive is amazing, you should check it for this and that. And I'm always like, awesome, sweet. That's the online elevator.

42:04 Jon McLachlan

That's spectacular.

42:07 Dan Sherry

Do you remember, like, we were, we went to like they had like an after party at [...] or whatever, like at a local bar, and we were there, and someone, like, I don't remember exactly [...], like, oh, what do you do? [...] like, yeah, [...] building that. And he was like, you built [Pulsedive]? And that was like, that was like wild. Like, that never happened.

42:32 Grace Chi

Dan, Dan doesn't realize because he lays so low, there's like a world out there where people really admire and are grateful to him, but then he doesn't like necessarily see them. And then so we get a lot of users who come in and they're like, oh my God, Dan, you built this whole thing, or like, you're still like building it out. And you know, you didn't use, you know, pre-built tools or frameworks. It was like all a lot of native development. And so people like don't necessarily understand. And at the same time, that's when we hear from users. They're like, oh, we thought you were bigger. We thought you had more people. We thought you had more, you know, we thought you had funding. And we're like, good, we want to keep punching above our weight class.

43:06 Dan Sherry

A lot of that impression is from Grace too. I mean, like, we don't have a full marketing team. Like, that's all Grace [...] the impression that we're, that we're bigger than we are.

43:19 Grace Chi

It's not supposed to be an illusion. It's just, you know, I think

43:25 Jon McLachlan

It's a reflection of your reality and your humble beginnings. And now it's all paying off.

43:31 Grace Chi

I think what I enjoy the most is that marketing gets a bad rap. And I get it, that people don't necessarily [do] marketing well. I fully understand the frustrations. But as far as the discipline of like finding out what's authentic, finding out why users like you, why they want to talk about you, and then applying that in a way where we're not forcing, you know, we have a very consultative sales approach. We just put ourselves out there, we try to educate, we do what we can with the resources we have to have a presence that reflects the reality. That's been a lot of fun, because I get to like take all the skills I've built and learned, but I didn't necessarily believe in previous companies or for previous products, and then do that for a community that's like cheering us on every day. Like, that's a completely, like, 180 from places I've worked in the past.

44:12 Jon McLachlan

It sounds like you've enjoyed a huge level of success already, and going to continue it well into the future. Well, I'm just going to say thank you so much, both Dan and Grace, for joining me. We'll have to have you on again at some point in the not too distant future, and we can see how [Pulsedive] has changed and has changed the world and made it a more secure place for all of us. And yeah, just, I'll leave you with a huge thanks, and we'll connect again.

44:38 Grace Chi

Yeah, thank you so much. Maybe in the future, we'll just have a user who likes [Pulsedive], so we don't have to keep talking about ourselves. It's more fun that way.

44:45 Dan Sherry

Yeah.

44:47 Jon McLachlan

Sure, sure, that works too. Thanks so much, guys.

44:52 Grace Chi

Thank you.