How to Build a Great Company, from the Experts
Especially with tech companies, you've got to remember the importance of thinking in terms of consumers (using that term broadly) and how they will be using your product. You can't just fall in love with what you're building for its own sake.
That was George Bell's lead lesson at the recent MIT Enterprise Forum session featuring four entrepreneurs sharing their pearls with a packed room of nearly 300 attendees. It was a memorable evening.
When you've got entrepreneurs of the caliber of the presenters at this session, it's hard to know where to start. The stories were wise and sometimes uproariously funny.
After Bell's (General Catalyst, Excite@Home, Upromise) opener, Jeff Taylor (Monster.com and now Eons) noted that back in his classified ad agency days, at his first encounter with Bell, "He fired my ass." The two later became friends, and Bell's General Catalyst is an investor in Eons.
Mike Duffy, a first time CEO at OpenPages, shared his story of reinventing the company. When he joined in 2000, the company had raised $50M and was burning cash at $12M a quarter. The market tanked and the company went from 300 to 40 employees in 2001. Ouch.
Duffy noted that one of the first things he focused on was establishing a culture that everyone could believe in, setting the tone for the way they'd work with customers and employees. The company developed award systems to recognize people who did amazing things. "A big part of building a great company is capturing peoples' hearts," Duffy said.
Taylor agreed: "This whole decade is about your people." He advocates a play hard/work hard culture.
Bell told many marvelous stories, but this was a favorite on the subject of culture. When the company reached 4000 employees, he realized he no longer knew most employees' names. So they began to try to capture the culture in training sessions and via policies. (He summarized the early training programs as: "Here's your PC. Good luck.") By the mid-90s, Excite started offering some quirky benefits -- dogs on campus, a breast-feeding policy. There were 20 or so bicycles on campus (honor system) that employees used to get around campus. The requirement was that when using the bikes, you also had to use the front basket to deliver any documents that needed to travel to your destination.
One day, a young engineer's Lamborghini was being repossessed. Bell stumbled open this scene and asked what happened. Short version: The engineer got in over his head when the stock was booming. Bell stepped in and guaranteed his loan. (Bell joked that this was probably a terrible lesson: "If you get in trouble, the CEO will bail you out.") As you might imagine, that story went through the company like wildfire and created a lot of good will.
Taylor chimed in with another often-told but still charming story. As Monster.com got larger, they had to look at employee productivity. He learned that folks needed time to run errands and pick up the dry cleaning. The company contracted with a local dry cleaner and instituted the Magic Closet, where employees could drop off their dry cleaning for pick up and return. The first week, only 14 people used it. The second week, 50 people used it -- and Taylor picked up the tab. He said he eventually learned that he didn't need to pick up the tab every week, but if he did it now and then, people were amused and word spread. Eventually, they had to have a Magic Room and hundreds of people were using the dry cleaning service.
And then there's the towel story. Monster.com wanted to encourage employees to exercise, so the buildings had showers, so folks could get outside at lunch. But Taylor just didn't feel folks were inspired. This begat the towel service. He had really fluffy Monster-logo'ed towels made up and parked 15 in the ladies' showers, 15 in the men's. They disappeared. A new batch was deposited in a few days. In the first year, they went through 1400 towels, and eventually, employees started giving them away to friends and neighbors. During that period, you'd see a scattering of Monster.com towels on nearly every beach trip.
to be continued...