“The best companies have hostages and not customers… If in the dropdown menu the United States of America as a country is listed right before Uzbekistan, you're a hostage company.”
Summation with Auren Hoffman · Startups & Venture · September 2026
Auren Hoffman had asked whether AI advantages startups or incumbents, and Rampell used the question to separate beloved products from captive ones. His test turns on the user and the payer being different people: if a CFO has already written the nine-million-dollar check, nobody has to bother moving the United States to the top of the country dropdown. He had made the same point on Twitter about Workday, and says he does not want to invest in hostage companies.
Transcript
So I've recommended this to so many people. But like one time I like I wrote this kind of like Twitter thread on like how Visa works and it got lots of, it got lots of action on Twitter, should we say. And I wish I had set up an affiliate link. I just wasn't smart enough. And at the end, I was like, for more, read this book. And then like he got like a ton of sales. He was like, thank you, because it's like this, this book was kind of like, you know, putter your log. And then it's like, I don't know, a lot of people went to Amazon and then bought the thing.
I hope after this podcast, he gets a ton of sales too, because it is such a great book. It's definitely a book that I think anyone who's interested in this should read. No, okay, now let's talk. You touched on AI. I sometimes go back and forth. Like, do you think AI gives more of an advantage to the startup or more of the advantage to the incumbent?
I think it's tricky. Like there's a saying that I use a lot, which is the best companies have hostages and not customers. And one of the ways to tell the difference is, like, are you a hostage company or are you like a beloved product company? And one of the ways to think about that is, is the customer, the user, right? The user is the person that has to use the product. The customer is the person that pays for it. And then at the shorthand for all of this, I think I tweeted about this with respect to Workday. If when you're signing up for a product, if in the dropdown menu, the United States of America as a country is listed right before Uzbekistan, you're a hostage company, right? Because, you know, why do I say this? It's because if you were trying to optimize product experience.
Exactly. You would never do that. You would just like, so you know exactly, you know, the IP address of the person, you know, you know, all these other things. Or
you just put like Canada, US, right? It's just like at the top. I know that 99% of my customers come from here. If you don't give a shit, you're like, I got you captive because your CFO cut me a $9 million check. Ha ha. You have to use Workday. It's like, by
the way, I freaking hate that. Whenever I see like the dropdown and they know I'm coming from the US, even if it's a foreign thing, like they know I'm coming from the US. Like, why have an alphabet? Like, why not just have like the first choice be the, it's so obvious.