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Q: How do you handle the movement of people who are only suited at certain stages of growth and maturity at Xero?

5/24/2017

Rod Drury
CEO & Founder
Xero

A: If you’re a public company and your results go out every 6 months then you’ve got to make moves. One of the interesting - and hard - parts about Xero is that we’re growing so quickly that people who’re great at certain level might not be right for the next. We tend to have those conversations pretty early. For people who haven’t been right, they’re usually valued inside our network so we help them to get their next job and keep their career moving. We care about all of our family. But there are a few people where we’re at just might not be the right place for them. They may be halfway to where they need to be but if we replace them it’s going to get rid of the job they had. We try to be very human about that, make sure they’re not financially effected too much. We’re very positive and proactive about getting them into their next opportunity, and it’s exciting to see how they flourish.

We also sometimes get people to change careers inside the business. Quite a few people bounce around inside the business until they find their thing, and then they’re off and running. We also occasionally hire over the top. While that can be traumatic, 9 times out of 10 the feedback a few months later is that they’re enjoying work much more learning from someone. All those dynamics are things we care about and are working on all the time.

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Q: How do you make sure you get the nourishment you need in terms of intellectual conversations, and keeping a view on what’s coming ahead?

5/24/2017

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Rod Drury
Founder & CEO
Xero

A: We have people right through all levels of the business that really get it. You naturally build those relationships and so get a lot of that internally. If you do find people from other companies you look forward to those interactions. CEO’s share a lot of stuff. I just had a text from Mike Cannon-Brookes yesterday, wanting to benchmark some policies they were doing. So you just ping it straight back on a text. There is lots of support in the network. We’re all time poor so we don’t want to reinvent the wheel, so we ask for help quite often. When you find people that are stimulating, push back, and have a good perspective, it’s really interesting.

Some tips on this. I’ll see one of my staff and they’ll say ‘hey Rod, how are you?’ And I often think doesn’t really matter, does it? Ask me a question or something relevant. When you’ve got fifty people asking you how you are it gets a bit tiring. But if someone says ‘hey Rod, I’ve got a problem or what do you think?’ That’s really interesting. Asking questions is a great way to connect and just get to it, because you don’t have time for pleasantries when you’ve got lots of people. At a certain size there is this asymmetry where everyone wants to talk to you, but you’ve heard every conversation - unless someone blows you away and it’s really interesting. So consider that perspective if you want to network with important people. Ask them a question that makes them think. Chit chat isn’t really that interesting, we’re all too busy.

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Q: What has been the most useful investor for you, and how have they had the biggest impact?

12/14/2016

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Rich Chetwynd
CEO & Founder
ThisData.

A: Early investors were really key; they helped me better understand the investment landscape, how to navigate it, and how to raise capital. More recently we’ve added a few investors who our smallest investors, but they have really high impact. They’ve been really helpful for their network and introductions. They’re literally our smallest investors but probably the most useful for making progress in the US. These three investors are all based in the US and they’ve all helped with introductions, guidance, or various different things that I wanted to achieve. When they asked to put a bit of money in the business we didn’t really need it. But we agreed to allow them to join on the condition that they can help with x. It’s so important that you’re not just getting money; that there is an cherry on top.

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Q: What has your approach been to raising money? And how is it different being a first time founder?

12/14/2016

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Rich Chetwynd
CEO & Founder
ThisData

A: For me I had never raised money before. I’d built and sold a company and that was great, but I’d never raised money before. It was the classic case of ‘ask for advice and you’ll get money, ask for money and you’ll get advice.’ There wasn’t any funny business going on there, I just really wanted the help. So I found the single person I knew who had a lot of experience raising money, and I went and asked that person if they’d be interested helping me put it together. Then ultimately they ended up putting in money as well. That person was really key; I didn’t need their money but I really needed their help. And they helped me work out what that initial valuation might be, how much we should raise, who we should raise from, as well as opening a few doors and making a few connections. That’s is how I started off on that raising journey.

There are so many questions when you go out to raise money. You’re all obsessed about what you want to do and how you’re going to change the world; and you need x dollars to do so. But then there is are sorts of other things that come into play. How do we value this opportunity? What sort of investors do we want? What are the timelines we’re looking at? How do we put together good terms?

One of the things that also came up for me was to stop thinking about the first round. To start thinking about what the subsequent rounds actually looked like. You can get hung up thinking it’s all about that first round of money, but once you’re on the capital raising buzz it’s hard to get off it. You have to spend the money, but then if you haven’t hit the targets you’re still spending the money. So you’ve eventually got to trim your costs, raise more money, or more likely both.

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Q: What were the biggest learnings from the failures that you took into Kami?

10/5/2016

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Alliv Samson
COO & CoFounder
Kami

A: Assess the failures earlier, I must say. Looking back at our pivot from Notable [the first version of Kami] I think we should have pivoted earlier. We were too afraid to let go and move on, to accept the fact that we were growing as fast as we possibly could. We’re trying to push it hard, and didn’t stop to think that maybe something else was wrong; we didn’t look at the bigger picture. I wish we pivoted earlier, I wish we were more courageous and open to assessing what needs to be changed. At the time of our second pivot to focusing on education we were growing really well with Kami, but we were doing too much. We were trying to focus on too many markets. We thought that we could do it. We thought, ‘they love our product, it’s got to work’. But the truth was there is only four of us, and we can’t do all of those things. We should have focused on education probably mid last year, when we started going to conferences. We were getting all that feedback and receiving these suggestions from our education users, so we should have had a lightbulb moment where we thought let’s focus on education. But we didn’t and kept trying to do as much as we could for too long. It didn’t end up well on our end, because we were so resource constrained. That’s one of the biggest lessons I took, that we should have pivoted as fast as possible, and actually assessed our difficulties earlier.

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Q: What were some of the things that led to your pivot? And where have you ended up to now?

10/5/2016

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Alliv Samson
COO & CoFounder
Kami

A: So we’ve actually pivoted a couple of times. The first pivot was from a focus on NZ’s higher-education market to being more US focused, and less specific on verticals. What led to that pivot was mostly the growth that we wanted. When we closed Notable [the first version of Kami] we had around 5000 users, and that’s within a years growth. And that’s not good enough. Now we get 5000 in a day or so. That’s the difference with the same amount of effort. So that was the first pivot.

The second pivot happened a couple of months ago. With Kami we were lucky because because everybody with a PDF or an online document could easily use our product. But unfortunately for us, with only four full-time employees we’re very constrained resources wise. We just couldn’t cover every industry and every type of user that we have. So we decided to narrow our focus. We’ll still support other types of users - but we will focus the business - marketing, sales, engineering and development - on the education market. So we’ve just basically refocused the entire business to the North American - mostly US - K12 market. We were growing before we made that decision, and now we’re growing even faster. It’s definitely been a big learning curve for us, but we’ve been happy with how it’s gone so far.

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Q: How do you integrate your values into your business so that they actually make sense?

5/17/2016

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John-Daniel Trask
CEO & Founder
Raygun

A: It’s a really good question. I remember this story coming up, and maybe there is some exaggeration, but a company worked on their values and got the first set, then someone went to Woolworths to buy some groceries and realised ‘shit, their values are the same as ours, this is not good!’ And so they went back and redid them to make them more punchy. One of their values ended up being ‘we do rolls royce type shit’; i.e really great stuff. Rather than ‘we’re quality orientated’ it was ‘we do rolls royce type shit’. When you create values that people don’t feel embarrassed by, that feel like they’ve got the grit and the edge of the actual culture in them, they resonate a lot better. One of ours is ‘there is no time for bullshit when you’re building an empire’. People just resonate with it a lot better when it’s phrased that way as opposed to generic platitudes that mean nothing to anybody. You’ve really got to get your own vocabulary around it; they should be fun and edgy. We blatantly went and stole one from Atlassian: ‘don’t fuck the customer.’ A couple of people on the team said “we can’t say that!” But why not? You’re going to remember it, and it’s true. The customers give us the privilege of being able to do what we want do. They’re the last people we want to piss off. But because it’s so attention grabbing everybody remembers it. You can sit there and you might see someone engaging with the customer and you can say, ‘dude, did you just fuck the customer there?’And then they think, oops, I did, my mistake.

Until we put values in place, if my business partner or I were to take issue with something it can seem like it’s a personal thing. But when you refer it back to those values - you go over and say you can’t talk to the customer this way because the whole company is very clear this value is important to us, then it doesn’t feel personal.

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Forward>>

Q: How do you handle the movement of people who are only suited at certain stages of growth and maturity at Xero?

Q: How do you make sure you get the nourishment you need in terms of intellectual conversations, and keeping a view on what’s coming ahead?

Q: What has been the most useful investor for you, and how have they had the biggest impact?

Q: What has your approach been to raising money? And how is it different being a first time founder?

Q: What were the biggest learnings from the failures that you took into Kami?

Q: What were some of the things that led to your pivot? And where have you ended up to now?

Q: How do you integrate your values into your business so that they actually make sense?

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