'Worst of both worlds': Life360 CEO won't support hybrid work

Watching footage of Hurricane Katrina’s rescue at home — in fact, next door to where his mother still lives — Hulls came up with the idea of ​​a locator app. Getting funding isn’t easy – no one thought teens would own a cell phone. “That’s a good reason not to listen to investors,” he said. But he found the modal and, finally, the ASX list.

Along the way, Hulls and his app have been at the center of debates about parenting style and privacy, as well as the target of social media campaigns, and even briefly, Australian tech lovers.

But back to California. Hulls described the city’s tech precinct as a “ghost town”, emptied by pandemic-led remote work and sliding technology assessments. The changes are noticeable even to tourists: The Anchorage Hotel on Fisherman’s Wharf now has a concierge working from home for a week, for example.

Hulls considers the sell-off in stock prices to be excessive. AFR

AFR Weekend was in a meeting at the Hulls house because there was no office in San Francisco to visit. Bryant Street headquarters – which at one point housed about 120 employees – is missing, though some tables may be available in Tile’s San Matteo space, near the airport. Less than 20 percent of the group’s 250 or more employees live in the Gulf area now, a geographic spread that Hulls promotes. The group’s chief financial officer resides in New Jersey, and the chief marketing officer in the midwest.

The ‘danger’ of hybrid work

“Hybrids are very dangerous. I think it’s the worst of both worlds. We don’t want a second-class culture where people who don’t enter are second-class citizens,” Hulls said.

Prior to COVID, Hulls planned to cancel work-from-home Fridays — they turned into a three-day weekend, in his view. Now, the entire company would gather twice a year for three or four days. This year, they met in San Diego and Arizona.

Developers are always scattered – Life360 has 50 developers in its Kyiv office, which has now been relocated to Romania – but the pandemic means big changes for the company.

The remote work model isn’t the only shift. Falling share prices mean the group is putting aside plans for a long-discussed Nasdaq listing, and pulling back on expansion plans and marketing spending.

Sitting around a dark fire pit on a cool summer’s day, Hulls – who became known as a Tik Tok campaigner after he took to social media in response to Millennials’ push to downgrade apps – opened up about the impact of the tech rout.

He described the market as “a little myopic around growth”, a change that has delayed UK expansion until the first half of next year as it proves there is no need to raise cash.

As far as Life360 goes, he thinks selling shares is too much. “Zoom has sold the same amount as us, but Zoom is doing this crazy thing for being the winner of the pandemic,” he said, explaining that Life360 was hurt by the lockdown, but would benefit from the unlock.

And then: “According to App Annie, we are the 19th most installed iOS app in the country. And any application in front of us is worth tens of billions, hundreds of billions, or trillions. So we are very odd outliers, and not in a good way.”

The Weather Channel came in at 18th, Roblox at 17th, Google Chrome at 16th and Twitter at 15th, based on iOS app installs. In other words, Life360 is installed on 12 percent of all iPhones in the US.

At the break-even point

Ask about the point where Life360 is hard to replicate, and Hulls makes two points. First, regardless of level, they are close in the US. He remembered a visit to Kentucky a few months ago to see a good friend. At the bar, in his Life360 shirt (“I’m cheap,” he says, though which tech founder doesn’t wear their company T-shirt?) two people come and ask for a selfie because they’re using the app.

Alex Haro, co-founder of Life 360, rings the bell with CEO Chris Hulls.

And secondly, the big players – Google, Facebook, and others – don’t have a good track record of building apps, tending to buy them. Add to that concerns about how mega tech handles user privacy and location (a problem that also haunts Life360) and Hulls said a challenger was unlikely, though quickly added that he didn’t want to be conversant about the prospect.

Hulls is piloting a new phrase: value growth, which he hopes will capture and make the difference between tech dreamers and companies – like his own – which he considers to be at break-even.

“We’ve always been really conservative, while others are just burning cash,” he said, adding the company, due to report earnings on Aug. 16, is on track to deliver $250 million in revenue this year.

He also believes the shock will make the market more rational. Paid acquisitions, for example, have become “much more efficient”. He also believes that the Life360 tracking app will appear as a non-discretionary item, though admits that’s less true for Tiles.

“I’m pretty optimistic we’ll be seen as non-discretionary spending,” he said. And then: “I think there will be a calculation of who has the price power. And if you have price power, inflation doesn’t hurt you too much,” he said.

But he is also realistic. “I don’t know if the multiple will go back to where it was.”

Extra pressure

But falling stock prices did bring extra pressure. Most important among them is the question of how to keep the group’s 350 or so employees – many of whom have sat on significant paper gains – incentivized.

Hulls wants to make it clear that there will be no increase in equity at this level. “Everyone should be very relieved that they’re not in a situation where they could be erased to zero,” he said. “Theoretically we could go bankrupt, but there’s some value there and with the new equity grant, you get a much better entry point.”

And the risk of staff being hounded?

“We will always incentivize people in the long run… but where are people going? Because even the bigger guys have stopped hiring. Netflix did layoffs, Amazon slowed down a bit, and Facebook, I think had a hiring freeze. They are a company that drives comp. So comp equity has gone down, but that’s everyone.”

When is he next in Australia? “I’ll probably do it once a year. I think COVID has shown how inefficient the roadshow is [are],” he says.

Most likely, he will be here in November, after the second quarter results. And at that time, it will be a pumpkin harvest.

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