Panelists
Sherry Coutu Executive Chair, Founders4Schools
Rand Fishkin Founder, Moz
Adam Gross CEO, Heroku
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Strategy Turing Fest 2017
Panel Discussion: Sherry Coutu, Rand Fishkin & Adam Gross
Rand Fishkin , Sherry Coutu , Adam Gross
Auto-generated transcript - may contain errors. Tap a timestamp to jump the video.
I wanted to I wanted to start with a question of geography. Something that I spend a lot of my time thinking about is is where to live, what to do with yourself, where where to be. We're in this weird world now where we have all these options to kind of live anywhere or certainly to work anywhere.
You you guys are all in in different places. So Sherry's in London, Adam's in the Valley, and Rand's in Seattle. And starting with you, maybe, Rand, something you said to me the first time we met was that if you were to start again, you wouldn't you you think Seattle might not you said that in we met in two thousand fourteen, and you were like, oh, it's so expensive now.
There's so much competition for talent, etcetera. Have any any thoughts on that? Any thoughts on the pros and cons of being there versus other places? Yeah. Sure. So can you guys hear me okay? Is the mic picking me up? Alright. I I am generally a believer that if you want to build a company that needs to raise hundreds of millions of dollars, it is probably wise to be in one of a few limited numbers of geographies in Seattle, London, and San Francisco or the Bay Area are among the better ones.
New York is a fine place to do that. Denver is actually seeming like it's a fine place to do that, Austin, Texas. But the vast majority of you, I hope, will not raise hundreds of millions of dollars and will instead opt to raise a few tens to hundreds of thousands, or maybe a handful of millions.
And I think that if you are building something that is primarily solving a problem, perhaps not Sherry's big giant problem, which I think only a very small handful of startups that aim for venture capital, that know they have an extreme failure rate, that know that the odds of them, of you as a founder staying aboard and doing well from that are not great, that I would urge the rest of you to consider alternate geographies.
I think Edinburgh is a wonderful one. Yeah. It's interesting. It's something I think a lot of start ups and maybe investors are thinking about in Edinburgh at the moment. We saw Skyscanner exit last year. They've raised a lot of money, not much of it or not certainly not all of it here, lot of it from the Valley.
Fanjul raised crazy amounts of money, most of that in the U. S. As well. Everything seems to be a bit more fluid geographically. Do you see that, Sherry, with London? I think that you can where you raise money doesn't necessarily mean where you have to base all of your operations.
I mean, I live in Cambridge, and it is a great treasure trove of of many things and close enough to London to be able to get the finance part. I mean, what what you need really are is the talent, and people can help you and what you what you want to solve that problem.
I think Edinburgh is absolutely brilliant. And you've got very, know, well all part not just Edinburgh, all parts of Scotland are are, you know, it's a it's a great place because you can get your hands on talent. You can focus on that. Probably the ability to retain people is easier here than in the Valley or or in I suspect.
But it's it's good. And I think it also, you know, you as a founder, and when I say big problems, it can be a narrow it can be a small niche. If I think about New Energy Finance, which we sold to Bloomberg, that was a very small niche, but a very good niche.
But you could only tackle that on a global basis because there no one market in one single country was big enough for that market. So, you had to be global from day one. So, just use a problem, a real pain point for customers.
It wasn't just big on a you have to raise kazillions. It's a big problem that you can actually solve so that you've got a customer that's glued to you. And I think having a customer that's glued to you is important. We haven't spoken about that B word yet, but if that makes it harder for me as an entrepreneur to hire and retain talent, I will very easily, and my advice to others would be to go where you can get the talent to fill your customer orders and make your company a good one.
And my true north is always around getting the people on the team around you so that you can hire them, train them, make their lives really interesting because they've created a product that has changed a lot of people's lives and made them more meaningful through that.
And you, Adam, have been in the rarefied air of the Bay Area for a while? I have. You've been out? Were you saying I look old? Excuse me. Yes, I was saying that. So you've been a founder there. You've been, I guess, early you were fairly early with Dropbox.
Is that right? That's right. And then you were founder, and then running Heroku. So you've had a few a bunch of different roles, maybe all sides. How how do you see the like everyone seems to be people here, people complain that it really hard to hire developers.
People complain about that all the time here. And then people complain about that in the Valley. People seem to complain about that just basically everywhere. Yeah. My I don't think I think there are lot of different ways, there are a lot of different paths.
And anyone who tells you there's kind of one path to creating a start up, creating your company is is That's an invitation to just do the opposite of whatever they're telling you. But, you know, I don't think you need to decide where your startup is going to be at the beginning.
I think that's something that you decide You can decide later and I I share the view that you only have to be in one of kind of the top tier from a VC point of view, not from a city overall standing point of view.
Cities if you're, you know, your ultimate aim is you're on a path to becoming a publicly traded company or kind of something in that range. There's nothing to stop you and in fact, it's probably preferable to start a company, get traction, see if you can find that kind of series A, series B market fit, then decide whether it makes sense.
And as somebody who sits in San Francisco, there's a kind of Ellis Island of startups always coming over and that's something that I would much rather see a startup be kind of reasonably developed and have reasonable traction, maybe leave development or other functions in another part of the world rather than just kind of, you know, two people and a dollar and a dream trying to kind of start all that up from scratch in that environment.
Because a lot of the benefit from that environment comes from the networking connections which you're not gonna get as much benefit for. I'll put another quick plug in though. At Heroku, we're about seventy percent remote from an engineering point of view and I think that's probably we're we're we're uncommon in that way, but what's probably more broadly where the trends are going.
If you have we if you look at our our we have a bunch of focus on Kafka as a product now. Most of our Kafka team is in London. So if you have specialized skills, the opportunity to work in a, you know, tier A enterprise software company is available to you and I think I would definitely take advantage of that so you can see how a large scale enterprise software company organizes and operates itself and save you the pain of having to do that.
And you certainly, you absolutely don't have to be in one of those major tech cities in order to get in that insider perspective. Yeah. Yeah. Totally totally agree. Actually we we're connected through one of your colleagues who That's right. Lives in Edinburgh. That's right. Has employees in Edinburgh.
We're very proud of that. Yeah. It's it's and we're increasingly seeing we've got tomorrow in the engineering stage. Mike McQuade is on. He's GitHub. So we're starting to see these sort of big name U. S. Tech companies with either branches or individuals through remote working.
Even the Fanjul example, Fanjul started in Edinburgh very much a U. S. Based product, commercial side of the business and some of the leadership now in New York, but still a lot of the development based here. And then Skyscanner for example, they've kind of gone everywhere, but they've kept their head office here.
It's really interesting. So the there's on on the question of remote that so at Mars, you guys don't have remote very much. Is that right? Very few. Probably less than twenty out of a hundred and seventy people. Okay. One of the things that I I hear all the time or read about with remote is that if you have that it's hard to do you kinda either or.
That you like, everybody remote or only, you know, these these sorts of things. Have you what what sort of Adam, you seem to have both and it's it's working for you guys, I guess. Yeah. The first thing is that you have to do it very explicitly and deliberately and it requires a degree of kind of cultural commitment that I've certainly learned a lot about in my experience.
The second is, as part of that deliberateness, we very actively hire remote engineers, but we don't hire remote product managers. All product management is in San Francisco, with a couple exceptions. And that's by design, one could argue whether or not that's the right model, sometimes that gets a little controversial.
But that's how we kind of choose to centralize some of the communications versus have each of those PMs then represent HQ inside of their teams. But it is something that you have to be very very explicit about. Heroku comes from an open source tradition like GitHub or like other companies.
And you'll find that given open source projects are naturally geographically distributed, open source companies or companies based on open source technologies tend to be more remote friendly or have that kind of more baked into their DNA. I think the only point I'd make, I completely agree with that, is in being thoughtful about it you need to have some of the communications infrastructure and practices, so you need to be, I think, more deliberate when you're distributed, so that those remote people don't go off on a garden path
that you're completely unaware of, and they don't feel outcasts. So I think you have to go to other greater efforts from a cultural point of view and also infrastructure wise to make sure that they feel one of the family and that they're productive members.
Yeah, agreed. It's interesting that how how you know you mentioned LSI's and those startups moving to to San Francisco. I guess these sort of these tech hubs draw in what's around them. And I think we're starting to see that a little bit in Edinburgh even where you know, you've got people who might be starting up in in somewhere that's an hour away or three hours away from Edinburgh, and then Edinburgh becomes the draw.
And then maybe London becomes a draw beyond that or it's I just find the whole thing fascinating about how how much we can move around. And I I know of a a developer actually recently who moved to Berlin from Edinburgh for a job with SoundCloud, but that didn't work out.
That was literally the week that SoundCloud laid laid off a bunch of folk. But it's yeah. The the the geographical question. I don't know. I think we're pretty fortunate to be in a world where where that, you know, we can we can all move around so much.
And and I think Edinburgh is in a pretty good position actually to to benefit from that. And not just Edinburgh, as you say, Scotland in general. Actually, already, I think you're seeing, like, it's much cheaper to get an office in Glasgow than Edinburgh, for example, if you you know?
So you're already starting to see that effect a little bit. Switching away from my my hobby subject of geography to the subject of mistakes. We hear a lot people a lot talking about, oh, I I did all these things, and now I'm this amazing success or whatever.
The tech world seems to do that quite a bit, but there seem recently, there's much more sort of confessional stuff. I think actually my favorite talk from last year's Turing Fest was from Rand doing a similar talk on that, you know, what you things you do differently, things that things that you you did well.
Sherry, any any mistakes that you've you've made that you you that you see repeated that, you know, you that you think need people need to be aware of? Yes. I've made lots of mythics. I mean, I still make mistakes every single day. I think that well, which there's two that sort of spring into mind.
One is the focus on your internal culture versus getting out and hustling and telling people about your product. And I think you can get too focused on external things, particularly when you're the founder and forget or ignore very much at your peril, especially if you're growing fast what's going, you know, sort of what's going on back at, you know, headquarters, particularly if promote.
Because if you're a million miles away and you get disconnected from the team that's creating the product and dealing with everything, I think you'll fail. And I think it's a very easy mistake to make. Far too easy a place to make. And I think even to the extent of on the hiring and making sure you've got a cultural fit so that others are attuned to the same decisions that you would want them to make.
If they have no idea what you're thinking because you haven't been in your office and you haven't been listening, then I think that's what I think of is probably the one that the most painful lesson. You can get too obsessed with your customers and then forget about the people that are delivering to your customers and that's that's hard.
And I think for global ones, it's losing it's it's those who have gone into the other countries to start up the remote operations, making them feel a part of it and, you know, one way or the other it's going to be infrastructure, a lot of travel, and you can burn people out and you can be so busy yourself that you don't see the warning signs in your either your senior leadership team or others, and I think that that's just a human travesty, and you don't you don't, as a person,
recover from accidentally finding that one of your team members has become burnt out. And and it it happens. It it happens in fast growth companies. And if I think about the things that I regret that hurt, that keep me you know, wake me up at night because it's still on my mind, it's those.
Yeah. Interesting. Adam, when you were when you were at Dropbox in that super crazy growth period, so, you know, we all know how all the good stuff. You know, what what what the things that didn't work out or whether, you know, what are the missteps that maybe happened there or that you've seen?
Sure. I could I could spend an entire conference talking about all the mistakes I've made, as I'm sure we all could as well. I'm trying to go back to my Dropbox experience in particular, and there was so much that I I took away from that.
You know, I'll kind of the most important decision I made about Dropbox was deciding to go. And I'm a big fan of the idea that eighty percent, ninety percent of your fate is set on day one. Even Dropbox was eleven people when I started, but still, how much impact is one person going to have?
So much is just going be set. And that's why I think the most important decision or mistake you're going to make really starts at day one. And so I talk a lot to people about how to think about what companies to join. Maybe that's a little bit of a different conversation to have in San Francisco than it is here in terms of the breadth of options that are available.
But I also talk to them about whether or not starting a company is the right thing. I've started two companies, I've joined three startups that already existed. I started my first company when I was twenty three years old and as great an experience as that is, as much as I am an entrepreneur, I might say that that was a mistake.
That I had a lot more to learn and that I would have been a better entrepreneur had I learned some of the basics of how professional software development works and just the mechanisms of a software company works rather than having to eke all of that out myself learning it every day on the street which was was pretty painful.
Yeah. It's an interesting point actually that the question of whether it segues into the b to b versus b to c. Something that we see a lot coming out of the Valley. For example, there's, like, really, really young teams creating these amazing b to b to c, the the likes of Snapchat and even going back to Facebook, which seems ages ago now.
And I see, for example, at code base or around there are lots and lots of young people that are getting into the the software business that have these ideas that they wanna go do a thing. But they're kind of conditioned by b to c because they haven't had the work experience to find the problems to solve in the enterprise world.
And it seem it seems like such a such I had a conversation with someone recently. I have this idea, and I was like, well, if I were you, I wouldn't do that. I'd get a job in a bigger business for the next four or five years, figure out the things that they struggle with and then fix that.
Does how do you I don't know. Does is there a reason that that's a different situation? It seems to be a different situation in in the Is that just a funding question where prepared to take a punt on a young team early on?
In general, I think the enterprise market, the B2B market is much, much more open to entrepreneurs and young entrepreneurs than kind of the broader perception otherwise exists. I would strongly encourage entrepreneurs to go into that space. The nature of the way that B2B services and SaaS are created and sold is so profoundly different than it was even ten years ago that it easily leaves opportunities for new entrants.
We see that particularly in the developer facing space because developers have affinity for developer problems. So we see companies like Stripe that do that very successfully. But I think it's possible in other domains as well. And it's much This idea that B2C has some easier path in terms of go to market or monetization than B2B is a total fantasy and that entrepreneurs quickly will find themselves bashed up against the rocks of.
And it's an unfortunate myth that if we can all help prevent a little bit, we're doing ourselves all a favor. Yeah. The first time I met Rand, it was some advice on my last startup, now dead. And he looked at me and was like, oh, that business model is really going to hurt.
And those monthly recurring payments at that low level are going to kill you, and he was right. Rand, on the subject that you touched on last year and you know things that you do differently again. You you know you're you're you're an interesting you're an interesting point in your career right now where that that you know you may have that opportunity.
Yeah. What what does the future, the near future hold? Well, I think on the on the mistake side, one thing one thing that I wish I'd realized sort of early on is that there isn't just one path, and I think this is something that Startup World and Silicon Valley World do to all of us. Right?
They sort of create this mythology of, alright, here's what happens. You are young, you are white or Asian, you're a dude, you are in college, you either drop out or you graduate, and you have a brilliant idea, and then you raise lots of money, and you build something that changes the world, and that is that is what success is in, you know, startup land.
And every step of that is just ********. I mean, you you don't have to be a dude. You you don't have to be white or Asian, you don't have to drop out of college, you don't even necessarily have to go to college, you don't have to raise money, you don't have to I don't think you have to find a big problem.
I think people can solve small problems and have a lot success and do the things that they want to accomplish in their lives. I think you can build I have plenty of friends who built what were what are called small businesses or what venture capitalists would call lifestyle businesses, and they use that pejoratively and insultingly, and I despise that.
Like I I hate it. I I hope everyone up here hates it. That is sickening. Right? The the success rates are better. The rates of inclusion of diverse people are better. The startup success rates for women are way better. But it doesn't it doesn't kinda like fit this perfect model.
And so I think that for me, that is one of my worst mistakes because I absolutely believe that for at least the first decade of my career. And I think it took like the last few years of sort of being challenged along all these vectors and then seeing all these other different kinds of success to say like, wait a minute.
Why did I think that was the only way I could do things? And then realizing, oh, because no one ever tells any other stories on stages like this. No one ever makes a movie you know, The Social Network is is like the movie of our, you know, field and generation.
There's not like the, oh, here's a, you know, a couple of women who started a consulting business, and they were able to fund their life and take care of their families and have a great life. And you're like, oh, wow. That's very impressive.
It's wonderful. Right? That's not the movie that gets made, but it is wonderful and successful and Yep. Should be, you know, cherished just as much. So for my next thing, I don't think I'm gonna follow that path. I think I'm gonna break out, try and break out.
Yeah. And will it be in Seattle? Or are there other geographies to explore? Sorry, I'm obsessed with this question. So Geraldine really wanted to buy a house in Seattle. So it's probably going to be in Seattle. Well, sometimes sometimes life gets in the way.
Yeah. Yeah. Okay. Cool. We've we've just over five minutes left. Maybe we'll open up to some questions. There is a microphone here I don't know if we have someone that might be able to pass it around. Have we got have we got any questions or we can keep going up here?
Oh we do we do good. I'm not sure the mic will get to you. Yep. Here it comes. Ah, a mic that's not turned on. Not much use. Just yell. Yeah. You just got I think you're just gonna have to shout. We'll get it.
Gosh. On on the marketing side, I mean, this is where I spend all my time, but but I think on it depends on the sector you're in, but if I had to name one thing, is breaking through massive amounts of noise and being signal.
And I think that's tremendously hard whether in b to c or b to b because it is in a marketplace of ideas and in a marketplace where you are competing for attention, your competitor you are not just competing against your competitors, you're competing against everyone else who wants attention from the target audience.
And thus, the hardest challenge is how do I identify who influences this person, whether it's people or organizations or brands, and then how do I get in front of them and make them amplify me on a regular enough basis that the person who's listening to them hears about me, and then how do I build trustworthiness?
And that that is a massive problem. I think something something over twenty percent of startups said that some form of I couldn't reach my market is what killed me. I I bet it's even higher than that. I'm a big believer of the idea that marketing and go to market and sales isn't something that happens to your product, it's something that's integral to your business and integral to a different differentiation.
If you're building a product with the idea that, okay, then I'll go apply a standard go to market model, That is going to be a hard hard row. If you look at the companies that we tend to admire most and modestly some that I've been lucky to work at, what makes Dropbox different?
It's got a profoundly differentiated go to market model. Right? It wasn't just about a product, it was a different go to market model. Look at Salesforce, profoundly different go to market model. Look at Heroku and its peers with GitHub or Stripe or others and Twilio in creating a developer go to market model.
In accessing a buyer that was previously untouched, many people thought that it was impossible for all those VCs would scorn companies that had a developer go to market model. The developers will never pay and we've seen of course now that's entirely the opposite.
So seek innovation and differentiation in your go to market model just as much as you do the other areas of your business. Otherwise, it's going to be a tough, tough road. And I think I'd say again just be the customer orientation. I would co build it with with them.
I've got a marketplace background so the viral and building the viral in is is really important because that will work for you but your product has to work so the connection between your product team and your marketing team and making sure there's no disconnect is is super important.
Anyone else? Anything to put to the panel? Yep. Front row here, mister McGrail. What what what would be the number one hard skill you would say a successful founder should either improve their knowledge of or go and go and learn to really increase their success levels?
I'll put a plug in for communication skills. And as every step of the way and the further I've gotten in my career or the further the companies that I've started or been a part of have gotten, how you communicate, your ability to take an idea and kind of scale that across an organization that's growing fastly to do quickly to do that consistently.
It's sometimes viewed as a cost, like, oh why am I spending a bunch of time developing this presentation, I'm just going to deliver internally, this feels like a waste of time. Versus seeing it as kind of core to what you do and judging yourself against how well you do that.
That's been a huge difference in leaders I've seen that have been successful versus not. I thought you said hard hard skill. But and I was gonna say, why would you choose a hard skill? Because the soft skills are probably the more important. But for me, if it's a hard skill, I would say data science so that you can get a signal out of the noise.
And I think helping everybody get a signal out of this incredible tsunami of noise that we've got is really important. And it's rarer than many things and it's also quite hard. So if you're looking for a hard skill data science so that you can get good messages to the communicators or communicate them themselves is really critical.
In the era of transparency and openness and evidence base, I can only see the need for that, you know, 10x ing in the next ten, fifteen years. Wait. Can I ask out of just personal curiosity? What would what would the soft skill be if you had asked soft skills?
I was gonna say leadership, but again, it's it's it's the how do you leadership. But but that involves comms, but that also involves empathy and thinking about the team and how to how to build out how how to build out the team. Empathy and communication are hard skills.
Okay. That's that's a very good that's a very good answer. Mike in his Scottish, he meant he meant difficult skills. Gosh. The signal and noise question just seems to apply to everything. You know, just that we seem to have more and more of kind of everything within, you know, and technology is just giving us more data, more information, more connectivity.
And you know, from your marketing background or history, think about how much easier it was five, ten years ago to figure out. I when I started SEO most, right, we were we were one of only four or five blogs in the SEO world.
So it was very even though we were crappy, it was very easy to get people to pay attention and subscribe. I've watched your very first Whiteboard Friday. I am so sorry. Yeah. It was terrible. That is seven minutes. You will never get back.
But it's a but it's you started. Right? That's you know? Isn't that one of the most important things? You know? To just begin. So I think we have time for one more. One more question if we have any out there. Okay. I guess we'll wrap it up.
We are I'm just wondering. So you Adam, just you just got in this morning. Randy, you've been here a few times. Sherry, you're here all the time. I don't know if you in your visits to Edinburgh to Scotland, if you've kind of sensed a bit of a change in the air around the tech scene.
It it sort of seems that way to me. It's great. It's I think you've got a supportive ecosystem, you've got the curiosity, you the obsession with just starting things and supporting people throughout the whole journey is is better and it's tangible. And I think it really feels like a community.
I mean, I'm not a member of the community. I'm sort of on the outside, but it's function, I think you can see it working and functioning. I think the ability to thrive in being an entrepreneur here, I think appears from the outside to be better and easier than perhaps before.
So that critical mass that you would wish upon you, I think, is kicking kicking in. I feel like there's a almost and I've only been here three times now, but I feel like there's a cultural lack of power distance, which I think is superbly healthy for building an entrepreneurial culture.
Right? So power distance would be saying, oh well, I can't talk to Sherry, she's accomplished all these amazing things, and I sort of followed her for years and worship her. If I see her in the hallway, I'm gonna stand back and duck around a corner.
I don't think that happens in Scotland very much, and that's really healthy. Right? Because in a lot of parts of the world, Seattle included, that is a real thing. So Yeah. Interesting. One of the things that we probably don't even think about very much here, probably proves your point.
Okay. Well, thank you very much to my panelists. We're gonna go grab coffee now and see you all after. So, thanks very much to Sherry Khoutou, to Adam Gross, to Rand Christian. Thank you.