How To Grow and Scale A Culture with Limited Funds | Alicia Navarro | BoS USA 2014

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Scaling is a challenge which presents itself to any company starting out. Further to this, cash flow is the single greatest reason companies fail in the beginning. So how do you scale, whilst remaining respectful of your budget?

Skimlinks is a company that in 2014 facilitated $625 Million worth of transactions, and over it’s lifetime has grown to a team of over 60 people. Alicia Navarro, CEO of Skimlinks describes how she got there, shedding light on how she maintains culture, particularly through her recruitment process.

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Transcript

Alicia: Hi, everyone, lovely to be here, thank you. I’m quite blown away by what an animated and communal atmosphere this is, and thank you for having me. I’m here to talk about a topic that is very near and dear to my heart, and the thing that I’m probably the most proud of having done, which is…

“How to grow and scale a team and a culture, and how to do it on a limited budget.”

Let me tell you a bit about, I guess, me and why I’m here, and why I have the qualifications at all to be standing here in front of you all. So, my name’s Alicia, I, seven years ago, started a company called Skimlinks, this is my co-founder Joe, and for those who don’t know Skimlinks, it’s not a very sexy company, it’s not front end, it’s a monetization technology for websites, and when I started it seven years ago, I, for the first year, was doing it pretty much on my own savings, money that I got from my boyfriend at the time and some friends and family and a bank loan. So, for the first year, I had, you know, almost nothing.

And even when we raised our seed round, we still were doing a lot with very, very little. But I always knew from the beginning that to build a great company — and not just one that just kind of delivered results, but to build one that would make you want to wake up and go to work every day — you needed a higher-grade team and to build a great culture around it.

And I think it’s become the thing that I think of as my role as CEO, as the most important thing that I do.

So what have we done right, and why am I here? So, when I started the company, it was obviously just me, and now we have a company that is 70 people currently employed in the company, based mostly in London, although we have a team in San Francisco and a few scattered around working remotely.

One I’m very proud of — this is the picture that they did for me as a surprise on the day of our 7th birthday as a company, you can see me at the bottom. Here, [Laughter] with my co-founder, and every single one of these is an individual picture of one of our team members done, showing a kind of intrinsic personality trait of them, which is kind of cool.

So, that is actually our CTO [Laughter] and very funny event that happened at a Christmas party when we got dared to do the Kate Upton skinny dance; he hasn’t forgiven us. [Laughter] Anyway, the thing that I’m most proud of is that it’s not just a team with 70 people, because I’ve talked to a few guys here, and I am not by far the biggest company, or the most successful, by any stretch, but I do think that we manage to build a brand as an employer and a brand as a company of our culture, that is really well known. It is the reason that people stay in that company and the reason that people join. It’s to the point where even our cleaner, our office cleaner who comes in every night, says that her favourite point of her day each day is when she comes into our office, because of what we’ve kind of created there.

So what I want to kind of talk about today is how I’ve gone from hiring, you know, from nothing, and hiring a team of 70 fabulous people, and the tricks and tips that we did along the way to do that with very little money, and how to build a culture simultaneously to that.

So, it started off as just a very small team, and then became a very large team over the last kind of seven years. So…

So, what is culture?

And I think it’s kind of useful to talk this a little bit before I talk about the hiring, because I think that they are very entwined and all the… most of this talk is going to be around how to hire and how to hire well and to build a team. I think that fundamental to that is understanding what culture is.

And I don’t know if you’ve ever read… Have you ever read the Ben Horowitz book The Hard Thing About Hard Things? If you haven’t, you must; it is the book… it is the only business book that I have cried while reading — it is that powerful. But he has a really great section on building a culture, and he says (I’m going to be paraphrasing this): “Culture is not the fact that you have a ping-pong table or the fact that you have massages or the fact that you can bring your dog to work. They’re perks. A culture is the systems and processes and organizational design elements that you have that institutionalize or create a set of values that then self-perpetuate beyond. And so how do you kind of build these… What are the core values that are really important to you in your culture, how do they help produce the company goals that you want, and what are the ways that you can make that intrinsic?”

And the story that he tells, he tells a couple about what culture is, but I find them really interesting.

He said that, for Amazon… Amazon’s, you know, culture is all about… They really want to create an environment of being careful with money. They want to grow a company where it’s all about being the leader in cost price products. You need to create a culture that also embraces that. So for all their employees, he says, they all have doors rather than desks. They buy doors from home base and they put legs on them, and that means that every person that walks in and starts their job at Amazon says, “Why do I have a desk for a door?” And the answer from the team members is, “Well, because here at Amazon we really want to kind of be the cost price leader, and so we really want to install that in everything we do.”

So it’s a way that they permeated that kind of cultural element. He also talks about how Facebook never took off the signs of Sun off their doors, so that they always… every time you open up a meeting-room door, you would always be reminded of what you will become if you do not move quickly every day. Now, keep in mind that I think that the other thing is, you can’t actually on day 1 go, “Right. What is the culture that I want to create, and how do I do it from day 1?” A lot of this becomes something that you recognize retrospectively, and a lot of it is a direct reflection about who you are as the kind of leader, and those first few employees that you hire. And that’s why hiring is so important, because those first few hires are really critical.

Now, for us, and I’ve talked about this a little bit… Oh, thank you. What the previous… What I forgot to mention, for us at Skimlinks, we actually were very lucky and were able to quite organically almost create a name for our company culture, and that is this concept of Skimlove.

Now, I’ll explain what that means. Skimlinks is a terrible name. I mean, it really is. It’s a company name, I’m embarrassed about it, but it grew very naturally because it was a pivot from a previous company that I had called Skimbit which was also a terrible name. [Laughter] But it just because this kind of habit in the company to prefix everything with “Skim”. So, you didn’t have an intern, you had a Skimtern, you didn’t have a baby, you had a Skimbaby, it just was a thing, you know.

And so there was this kind of very natural thing that happened once when we were celebrating wins, and we were all on Yammer together, kind of talking, and there was this… how do I describe it… It’s a very difficult concept to explain, because it’s almost, you know, a transcendent thing, but as a company, we very much valued being kind to each other, and if we were going to win, it was more fun when… because we were good people, than because we were the cheapest or the fastest or the most aggressive. We wanted to win business, and we wanted to do good stuff just because it made us feel good, and it was a nice way to kind of work. So we call that Skimlove.

So, for instance, if someone celebrated because… won a customer because they were really, really nice, and that customer was so impressed with who we were as a company that they chose us instead of our competitors, we would celebrate it and write #Skimlove. When someone in the team helps someone else out and someone else out in a team, and it was just a really nice thing they did, they praised them on and said, again, #Skimlove.

And I just thought it to embody the kind of thing about our company that was really special, and now it’s so important to us that it is on neon letters in our coffee area when you first walk in the office. It’s a really, really cool part of our identity. And I didn’t force it; it wasn’t something that I came in on day 1 and said, “Right, everyone, we’re going to be talking about Skimlove, this is the way it’s going to work.” It was something that happened very, very, organically, and… But I went with it, and that’s kind of what the next slide talks about.

What I then did was break it down into what the letters represented, and tried to describe what it was to be… you know, what does Skimlove actually mean, what does it mean when you are hiring someone, what does it mean when you are looking for someone to add to the team?

So we break it down, for those who can’t read it or read it out. The “S” stands for “sparkle”, you know, the fire in the eyes, that glint that kind of makes someone feel that they’re passionate and excited. “K” was “kickass”, because you want them to be really good at what they do. “I” is “inventive”, you want to be kind of a hacker. “Master of our domain”, you wanted them to be the best at their job. Likeable, obvious. Open-minded, which is quite important to us. We have a female CEO, we have a female head of technology, we’ve got gay people, we’ve got people from different nationalities; we only wanted to hire people that were very, very open-minded, that were not easily offended, and that kind of embraced diversity. That was really key. Vocal, again, a really important thing for us. I don’t like people that… Hierarchies are useful for some things, but not if it squashes the opinions of others, so we kind of celebrated people being vocal. And lastly, entrepreneurial: we only hired people that wanted to be entrepreneurs themselves one day.

Anyway, the point of raising this is that once I’ve recognized that we had something special, I wanted to understand what it was, and find ways that I could perpetuate it via a kind of organizational means. So, we’ll talk about what some of those were. In fact, the rest of this talk is just going to be examples of what I’ve seen work. And it’s interesting, because I’ve done this talk a couple of years ago, a similar version of it, and actually, over the last few years, I’ve seen a lot of other companies try things and not work, or try things and work, so I put that into this talk, and I’ll make it a very kind of example-driven one.

So let’s break it down. Why… Actually, before I progress, I’d love to know, out of people in the room, put your hand up if you have… if your company’s sort of 10 people or less. OK. How about sort of 10 to 50? And then more than 50? Oh, good, so it’s a really good mix.

What I’m going to talk about now is the differences that… How is hiring different when you are a very small and you don’t have a lot of money, and I’ll talk later on how to hire when you’re a much bigger company.

So hiring in the early days. Cost matters a lot more, obviously. You can’t hire the best, most experienced person on day 1, so you have to find someone that hasn’t done their job before and that you can pick up for much, much less. Culture fit matters more. So, in those early days, I would deliberately not hire someone that might have been just the perfect fit for the job if they were even remotely not right from a cultural perspective. Now that we’re a much bigger company, a much less… if they’re, like, 20% off-culture and they’re perfect for the job, we might still go with them, but in those early days, when you’re like 10 people or less, the culture fit is one of the most important things because they are the building blocks of what your culture will become from then on.

A sense of ownership matters more. Ooh, I’ve gone nosier. [Laughter] Sense of ownership matters more. So in those early days, you want someone that is joining because they love the idea of being part of that early stage of the company. You do not want someone in your first 10 people that is doing it because it’s just their job, that’s doing it because they don’t feel any sense of entitlement. You want those first 10 people to feel that they own this child. Because let me tell you, in 7 years’ time, they’re going to be your senior managers, and you want them still to be around and still perpetuating the culture that you start in those early days.

And then… General skills matter more in those early days. So now, these days, I hire, like, a very specialized skill, and they do this one job, but in those early days you hire generalists and people that are not fussy or precious, because that person that I’ve hired to do account management will also do support, will also do office management, will do everything, and you want people that don’t mind. Because they feel that sense of ownership. You don’t mind what job you do; you’ve got a title, but actually it doesn’t really matter, you do… All of you do whatever you need to do to get the job done.

And so these are kind of the four things that really are important when you’re in those first days of hiring. And so how do you hire? I get asked a lot, “How do you find that first developer, how do you find those kind of first few hires?” And we did… Again, we had no money, we would do things in kind of the cheapest possible way. So we couldn’t even afford recruiters, so we were using… It’s not a big deal these days, but back then it was very odd to be using things like Gumtree or Craigslist, but we would be going to events, we would be… kind of the usual things that you would think of, but when you’re at a very, very early stage and you’ve got no money, it’s looking at graduate affairs or job boards that you would not expect to be using at that stage. But that made a big deal in those early days, when, again, we had no money.

We made it very hard to apply. The problem with putting a job ad up on Gumtree or Craigslist is that you’ll get 50, 70 applications, most of which are just people, clearly, that have just pressed copy-paste, copy-paste, and copy-paste and… And so what we used to do was ask at the end a couple of difficult questions, or even just “Tell us how you would do this,” “Tell us how you would do that,” and it was amazingly good at filtering out people that clearly did not care. OK.

This is one of my favourite things to do, and I do it deliberately, because, as I said, open-mindedness is a very important cultural value for us. So I will always swear in an interview. I will throw in a couple of really dirty words or some dirty jokes, or I’ll ask them what their favourite drink is. And it’s nice. I like doing that, because I kind of want them… to see how they react, and you want them to kind of be very obviously someone that can handle a little bit of filth.

Again, if you’ve read the [Laughter] Horowitz book “The Hard Thing About Hard Things”, in those early days it’s actually important to have a culture that values a little bit of… not depravity, but you know, a little bit of… [Laughter] You need to be able to swear a lot around your employees in those early days, I think. And it’s nice to kind of weed out the kind of people that don’t deal with that very well. I once told a really, really, really bad joke, which… the person didn’t last very long.

Anyway. We also look for open-source involvement for engineers, particularly, again… For most of you, this isn’t that big of a surprise, but at the time it was a really big deal for us, because there was a lot of people out there that could code and that were, you know, seemingly good engineers, but what we looked for, entirely, were engineers that… I didn’t really care about their jobs so much, but I loved how involved they were in open-source projects or on projects on the side.

One of my favourite stories is my second engineer — I had put a job ad up on Gumtree, and it was just for an engineer, and I had a bunch of applications. We interviewed a few people, but there was this one application from a Hungarian guy who… his CV consisted literally of his name and then 3 URLs. So I was about to throw it away, going, “OK, clearly this is not a serious applicant.” But then I checked out what those 3 URLs were, and he had actually conceived of, designed, built, and in some cases had sold these quite clever kind of script social media automation tools that were really quite clever, clever concepts that he had done from beginning to end. So I thought, “Oh, OK, this guy’s clearly really passionate about coding that he’s done this on his own without even needing to do so for the sake of a job.”

So I brought him in, and it was the funniest job interview, because he had never been to a job interview before, he hardly spoke English, he had dreadlocks to his arse, and in his job interview I asked him, “So what do you think about my company?” And this is the pre-Skimlinks one, and he said, “Yeah, I don’t really get it, but, you know, whatever you like.” [Laughter]

It was really awkward. It was very funny, because then he left, but there was something about his eyes, and I just thought, “You know what, he’s got the sparkle, he’s got the S from the Skimlove,” so I called him and I told him later that day, “You’ve got the job, you can come back.” And he did, and I put him to work straight away that same day. Years later, he tells me, “Do you know what? When you called me back, I was drunk with my friends and I couldn’t understand what you said on the phone. All I heard was ‘Come back’. I didn’t hear that you said I had the job. So I came back and you immediately put me to work while drunk, but I did your Facebook integration that day.” [Laughter] Bless.

Hire future entrepreneurs. This is one that has recently caused me a lot of grief, because the problem with hiring future entrepreneurs is one day they decide to become entrepreneurs and they leave you. I just had one of my favourite employees leave after five-and-a-half years to go start his own company. What can you do? But it does mean they stick with you for a long time, and that they value the experience more than the salary you can pay them. And this is a really key thing for us. We deliberately went and hired people that, when I asked them “What do you want to do in 5, 10 years?” they said, “I want to start my own company.”

And that meant, a) they were going to be much more used to the ups and downs which inevitably come with a small company, and 2) they value the learning, and so… the commitment that me and my co-founder made from the very beginning is that what we would… we wouldn’t give people salaries that could compete, but we could be really open about our learnings, what we did right, what we did wrong. To the point where we, when we do fundraising now, we take the whole team through the term sheet and explain every term and why we negotiated that, and what was that difficulty with that piece of negotiation. We tell people the things that don’t work, we tell people what happens in the board meetings — not everything, but enough so that, as people, employees in my company, they are now in a position, much, much, better than I was when I first started, to one day do their own company.

And they love the ride. They love the journey .They’re kind of addicted to the highs and lows themselves, and that makes hiring on a budget extraordinarily better.

This makes a lot more sense if you’re in Europe… I think it’s harder to do here, but in Europe we’re quite lucky, because we have essentially the whole of Europe to hire from, which is great. And one of the things that we’ve started to do now, even though we have now… we’re not as poor as we were seven years ago, we now have raised several rounds of funding, but hiring is still tough because of the scarcity of great engineers. So we now deliberately look all over Europe and pay to bring them over to London.

But back then we didn’t have that much money; instead, what we did do, is pay to become a visa sponsor, and so we were then able to hire people not just from Europe but even from India, from Australia, from the US, and you can pick up people that are really excited about the idea of working in London, in their 20s, etc. So that was a really effective way for us to get people that we might not otherwise have been able to get, and attract them not with the money, but with the lure of being sponsored to live in a new country. The same, I guess, works in the US. I think with entrepreneur’s visa it’s a little bit easier… I know… I mean, actually, I’ve gotten a lot of US visas for my team, and it’s not easy, but if you can look afield, I think that can sometimes make hiring on a budget easier.

  1. Here we go. Personalized packages. This was a really big thing for us in the early days. Again, we didn’t have a lot of money, but what we could do was listen when we were interviewing people. And so we would deliberately ask them a little bit about themselves, about their family, their interests, and when we gave them their offer, we… I mean, the salary was never very high, but we always put in a kind of special perk that was deliberately customized to what the person had said they loved during the interview. So, for instance — you can’t see these pictures very well, but one person said they loved rock climbing, so we gave them a one-year membership to a local rock-climbing centre. Another person said that they loved to travel, so we gave them an EasyJet voucher for 500 pounds. Another one said that they, you know, had kids, so we gave them a membership to Gymboree. Another one said they were just moving house, so we gave them a voucher for IKEA. And someone said that they loved animals, so we gave them a membership to the zoo.

You know, these silly little things, but they really show to the person that you care and that you really want them, specifically, to join your team, and it does wonders for both hiring and competing against bigger, badder companies that don’t necessarily give as customized packages. And it also creates a really great cultural blossom for that person when they start.

  1. I’m doing something. Oh, here we go.

So there’s this thing that we call “Alicification”. So, my name is Alicia, Lici’s my nickname, and there’s this process that we call “Licification”. So my co-founder will say, “OK, it’s time for some Licification.” So what that will mean is, we’ve done the offer, we’ve gone through the interview process, but now it’s time to really show them some love. So I’ll write them an email that goes beyond, kind of, the job and starts talking about the vision, what we’re trying to do here, why they’re the most important person for this role, and it’s very hard for people to say no to me when I do that. And it’s worked wonders. We have gotten people that I thought were so far out of our league, because I put in so much effort into really showing that they were an integral member of what we were trying to build. And I recommend that, again, as a way of hiring awesome people on a budget. You’ll be amazed at how some people will drop their salary requirements when they feel that they are going to change your life.

  1. Aim for a rainbow family. I think this one of the… I don’t know how, kind of, common it is here, but I think many kind of UK companies that I’ve seen, and even West Coast companies here in the US, will still be kind of mostly US or mostly UK people. And it’s been something that we deliberately have tried not to do. We deliberately love hiring people from different nationalities, different sexes, different everything, because I think it creates an electric environment. When you’ve got people that are all so different, you look around, those different accents, different faces, it creates something really special in a culture, something about the openness, the willingness to listen, the understanding that great insights come in lots of different shapes and packages, and I think it’s a fundamental thing that we embraced at the beginning that’s become a more defining characteristic of our company. And just to give you a sense, our team is 70 people, we’ve got over 21 nationalities, which I think is pretty awesome. We also… I should actually have made it one person and a half, but yeah. [Laughter]

We’ve got a pretty ratio for a high-tech company. It’s 35% women, and this is… not all of them are just kind of in sales or marketing. Most of the women we’ve got have got computing science degrees, even if they’re not engineers themselves. And it’s, again, a wonderful environment. You walk in, and it’s not just a bunch of boys in a corner; it’s a real co-ed environment. The founder’s a woman, our VP of engineering is a woman, our head of marketing is a woman, it’s a really diverse workplace, and what that does is create, again, an environment where people want to work. Women are attracted to working in our company because it’s a really safe, embracing place for them, and men like it because the women are hot. You know, I’m kidding. [Laughter] But it does… You want to create an environment where people want to come to work every day, and they create relationships and bonds that are more than just a 9-to-5 existence.

Another thing that I have learnt over the years is how to be really good at — especially in those early days — of being open-minded about who you hire for a job and how they kind of progress through their careers. So let me take… These are going to be four examples of people in my company. We can see how unexpected a career path they’ve had. So, this person was a really funny one, because I decided one day that I needed a kind of PA  and I didn’t have time to kind of put a job ad up for it, so my cofounder’s wife runs a fashion PR company, and he said, “Oh, my wife is always getting offers for people to be an intern. Why don’t we just take one of those ones to do this job?” So he literally picked the top one off the pile, and it ended up being this woman, this girl, that has… used to… was a blogger on the side, and we thought, “She’d be all right.” And it turns out she was. She came on first as a kind of PA/PR person, she then was so good that she kind of became a communications manager, and eventually she became a marketing director and was with us for years before, for health reasons, having to leave, get back to New Zealand. But that was a really unexpected career path, and I would never have chosen her to be our marketing director on day 1. But it’s about finding the right person that has the sparkle, the kickass, all those letters I talked about in the first place, and really kind of identifying where their talents lie, and created a career path that made the most of those.

This one here is one of our current product managers, who started life as a… she was a competing science graduate with no job experience, she had just finished her degree, so she came on as an intern. And she was literally categorizing websites. She saw a lot of pornography her first few weeks on the job, because her job was to look at the top 10,000 sites in the world, and categorize them as potential customers for us or not. [Laughter] There’s more porn out there than you would think. It’s amazing.

She then moved on to be, you know, Business dev team and she did that for a few years, and then, you know, we realized that because she, you know, her skill set was more on the techie side, we moved her into product management. And, again, on day 1 we would have never hired her as a product manager, but she’s growing into that role.

We then have one of our current QA managers, who, again, started as a competing science graduate. Started doing categorization as well, it was a real common thing for us. Moved into operations, and then moved into QA, and then finally, you know, one of the guys in my team, I think, could be the future CEO of the company, and again started as a graduate with no experience.

So, again, when you have no money and you can’t hire someone who’s done that job before, you learn to be very good at finding gems of specialness in people that you can kind of grow and develop into other roles. And it’s hard, because what’s going to differentiate one CV from another? So we did things like look for personality in their CV. Did someone kind of say something in a funny way, did they show if they had really interesting extracurricular activities, were they involved in some societies. Whatever is important to your company, find a way to be good at identifying those gems and identifying what they’re good at, what their passions are and developing career paths that work for them.

And it’s been really successful for us. Out of 70 people (I just counted this last night to make sure these numbers are still current), 15% of our current employees joined as interns, and 18% started as grads. And these are now… Most of these are quite senior people in our company now, and now we’re also hiring interns to work for them now. And it’s fantastic. We could never have hired the kind of calibre of employees that we wanted to, if they hadn’t had started as interns or grads themselves.

Some of the things that I’ve learned that didn’t work well…

You know, it’s not all roses and blossoms. Out of the 70 I said we have now, we have 21 or so have resigned over the last seven years, and another 20 of those we’ve fired. So we haven’t always got it right. And one of the things that I think we realize is that when we hire too many or too quickly and don’t spend too enough time with induction, you know, you can actually expect some churn. And I think we realized that there was this… Doing some numbers last night to kind of see the patterns, and I saw that there was a year where this one… most years…

So, let me say this the right way. I looked at each cohort of employees, and I looked at how many of them were still around today, and how many had resigned, and there was this one year where it was the biggest number of people that resigned or were fired. And it was also the year that we had hired the fastest and I think probably had spent the least amount of time on cultural induction. And it’s very true, I think. The second you hire too quickly, you don’t pay enough attention to the cultural side of things, it can be very disruptive to the company, it can be very difficult for the employees. And even now, when we are hiring very, very quickly at the moment, we spend more time than we’ve ever spent before on induction, on team-building, on team activities, because otherwise you’ll see this problem, you’ll see people that are not attached enough to your company, and therefore much quicker to leave if they feel that anything’s not working quite right.

Create traditions. So, this is one of my favourite things. I think this is something that you… again, that starts quite organically; it’s not something that you set up on day 1 going, “Right, I’m going to create this tradition now and create this tradition.” They happen very organically. So, in our case, one Friday, for example, someone was playing “Go Your Own Way” by Fleetwood Mac, and one of our engineers put, you know, “Oh God, not this song again. #Fleetwoodfriday.” And it became a thing, somehow, organically, that now every Friday, at 6:30 or 5:30 when we’ve done our tech demos, we play “Go Your Own Way”. It’s just a silly thing. Because it’s about breakups; it’s not even really a relevant thing. But we’ve kind of embraced it as our company anthem, about how if you’re going to do it, if you’re going to make it, if you’re going to get somewhere, let’s do it our way so that we feel proud at the end of it. And it’s become a thing that really identifies us that my team now play of their own accord at Christmas parties; it’s taken a life of its own. And I think it’s a really… It’s something that I’ve been very encouraging of, because I’m aware of how cohesive something like music can make a culture feel.

We deliberately spend money on getting teams together, so we now have people in San Francisco and all over the place, but every year, no matter what, we fly everyone to the same place and we do it at the moment every Christmas and summer, but we might just make it Christmas now. And we actually now, even take them… well, sorry… We take them for treasure hunts. So, we create this kind of city- or town-wide treasure hunt, and for the last two years, we’ve actually done it in foreign cities. We took the whole team first to Slovenia and then to Rotterdam and did treasure hunts there. And it’s fantastic for new employees. We would actually bring along people that hadn’t yet started but were due to start in the next few weeks, and it was an awesome way to create a sense of adventure and inventiveness and team-bonding that really carried on throughout the rest of the year.

Related to that, and I haven’t included it here because it’s not necessarily a tradition, but we always… Spending money to bring people together is always money well spent. So we have a large number of team members in San Francisco that we regularly will send people both to the San Francisco office or bring the San Francisco team over to London. It costs a lot. But the benefit that you get in terms of team cohesiveness, this sense of shared culture and shared experience — it’s absolutely worth it.

And we’ve got, you know, some of the things that — I’m sure you guys all do the same thing, like welcome questions where we get everyone to say “Two Truths, One Lie,” which can be a great way to kind of get people to know the quirkier parts of a person’s history, and I’ve really covered the Skimlove side of things. But it’s incre… I’m a massive believer in the power of narrative and the power of stories as a means of creating a bond and creating a culture that permeates even beyond you being in the room.

Make start-up education part of the overall package. Again, if you are going to hire future entrepreneurs, one of the things that they will get out of being your team is learning about what… how to start a company themselves one day. So, as I say, we’re very, very open about the fundraising processes that we go through, our financials, our CFO will stand up every Friday and go through the numbers, what’s working, what’s not working. We’ve just been doing a fundraise, for example, and I’ll stand up and tell the team, who I’ve pitched to, how that’s gone, what works, what didn’t work, and the team love that, and a lot of them say, “Gosh, we know previous companies I’ve worked at don’t do that. This level of transparency and trust is incredible.” And it creates an immense sense of loyalty and cohesiveness.

Celebrate wins. Again, as a technology company, we are very keen that we remind everyone in the company that we are a technology company, that we are a product company, and every Friday, for example, we do tech demos, or now we call it “Skim-and-tell” (you can… we use Skim in front of everything) — and it’s great. It gets the engineers, who are normally the ones sitting in the corner, kind of hiding from the world, but on every Friday they have to stand up and tell the team what they’ve worked on, what great things they’ve built, and we all celebrate it. There’s cheers, chinks of glasses, and everyone gets a real sense of celebration at the things that we build. Because what I’m trying to do is create a culture where we celebrate technology, where we love building great products. And to perpetuate that, I’ve created this tradition where we celebrate technology wins.

Another thing that I think is incredibly important that people don’t tend to do is hire internal HR early on. So, about… I think we did it at 20, but we should’ve done it at 15, so hire an internal HR or team development person. And they’re not just about hiring. They’re about having a person that your team feels that they can speak with about their own problems, that worry about team packages, that worry about team development, that worry about getting people onto courses and so on. It’s incredibly valuable, and the team really respond to knowing that you’re investing in them, in their career development, in their team happiness.

Even though we’re still 70 people now, still to this day every person that joins the company will be interviewed by me and my co-founder. And it’s silly because by the time they get to us, the team have already said that they really want to hire this person, so it’s often a formality, but we still have veto power if we really don’t see them working. And it’s an incredibly important process to make that person really know… There’s two things: one is, if I believe so strongly in the importance of culture in creating a cohesive, exciting team, I want to be sure that every person that walks in and becomes a Skimlinks employee has that special something. So we’re out there looking for that. And there have been a number of times when I’ve pulled the rug even if everyone else said that they wanted to. It’s that important.

And secondly, it’s a chance to sell. So, again, if this is, increasingly now when it’s so hard to hire engineers, I’ll get put in at the final round to do my Licification as part of the interview process. So I’ll go into this poor little data engineer, who’s kind of timid and scared, and I’ll be there telling him about how amazing it is and how important… what our mission is, and why this is important, and why you should join. And it’s wonderful. They… It’s wonderful to see that these guys are so necessary to the company’s mission, you know, that the CEO is taking time out of the day to hang out with them and talk to them. I don’t actually interview them; I just talk to them about their life, their aspirations, and it’s incredibly powerful, and you get the engineers, you know, a month later starting, and they still come up to your desk and say, “Oh, hello!” And I love that. I don’t sit, by the way, in an office; I sit right in the middle on a normal desk, because I want, again, the whole company to feel approachable to me and to each other.

We spend an awful lot of time on hiring and retention. Probably 30% of my time is spent either hiring or interviewing or thinking about team culture or thinking about processes or thinking about ways that we can make our team happy. It’s probably the most important part of what I do each day and continues to be, and I think will be, going forward.

This is a really important thing that I have seen a lot of other CEOs perhaps fail at, and that’s not recognizing that the culture of the company is a direct reflection of the CEO’s personality, and that if you want to create a certain type of culture, you have to live and breathe that every day yourself.

I see a lot of (I’m not going to name names here) CEOs that really want their team to work hard, and work, you know, 10 hours a day, and really care about things, but they don’t rock up to the office until 11, and they’re doing 5 other things on the side. And the team know that and there’s no way you’re going to create a culture of excellence and passion and dedication if you’re not the one that’s living and breathing it and showing it yourself every day. And I really… I think this is one of the most important things, and I think if you ask, you know, anyone in my team, that they will say the same. A lot of them (and this sounds so vain, but it’s not), they work hard and they care because they see I work hard and I care, and they know that that’s important, that they’re here because… they joined because they want to be part of that mission.

And so I think, as a CEO, or, you know, any senior manager, you are incredible responsible for setting your own company’s culture by the way that you act, the way that you hold yourself, and the kind of expectations you put on yourself.

And progressing along that is making yourself someone that others want to work for as well. So, I spend a huge amount of my time now talking, and it’s one of those silly things, because I actually don’t think that… I don’t think I’m anything special; I’m constantly critical of myself — but you have to create a brand for the company that you work for that makes other people want to join and want to join… want to be part of your story. And so you put yourself out there, and I’ve spoken to a couple of other people here today that, you know, recognize the importance of that as well — that if you want to create a great culture, you’ve got to be very external with talking about your mission, and that’s going to help attract people to work for you.

We do a lot of sponsoring of events. Now, this is obviously something that is easy to do once you have some money, but there’s still some things you can do without money. So, this weekend, actually, when I get back to London, we’re hosting a Stemettes hackathon, which is a… For those who don’t know, Stemettes is a group of females in technology, and so we really want to create… you know, hire a lot more female engineers, so we’re hosting a bunch of women engin… hacking at our offices this weekend. Similarly, we sponsored a woman to study at a coding school and we wanted to hire some great data scientists, so we sponsored a data science conference. Some of these things can be expensive, but, as I said, the hackathon is not, and it’s awesome for creating a reputation and brand for hiring a certain type of people.

This is an interesting one. One of my most recent employees is a failed entrepreneur, and I tell you, failed entrepreneurs are the best people to hire, if you can. They’re awesome, because they believe in you, they kind of now need money, so they’re kind of now really eager to get back into the workforce [Laughter] and they’re really eager to learn what they did wrong. And anyway, he’s great. But one of the things he said to me, “We spent…” This is a photo of our office. It’s beautiful. We spent a lot of money on this recently. And this guy on my team said, “I was kind of amazed that you would spend that much money. I know in our company we would never have spent that. A couple of desks, and spend your money on something else. But now,” he says, “I recognize why you did it.” And it’s because if you…  I don’t know if you’ve ever read The Architecture of Happiness. It’s a really great book by Alain de Botton, and it’s all about how the degree to which culture and mood are a direct reflection of the environment that you’re in. And so if you want to create happy people, you create a happy physical environment.

And it’s an awesome book, if you haven’t read it. But it really kind of inspired me, and so we deliberately spent more money than we probably should have on creating a really, really beautiful space. And we can see on the pillars here is… We have these things called The Three Pillars, which are the way that we kind of frame the way that we work, so one’s “building great technology”, one’s “creating engagement”, and the other is “driving revenues”. There’s a lot more behind it, but at a high level, that’s it. And what we’ve done is, we’ve got a designer to create these beautiful murals that represent each of those, and paint them on the pillars. Ironically, we have three pillars in our office. It couldn’t be more perfect. And so we’ve gone and invested in these beautiful offices that people love to come in, they feel inspired to think and to dream. Now, again, if you don’t have a lot of money, you obviously can’t spend a lot on a great office, but you can still spend a lot on finding… You don’t spend a lot of money just to create a great environment, one with lots of light, one that has good communal areas, one that smells good.

Smell is one of those underrated things. In fact, I think the next slide shows, I deliberately placed… the first thing that you see when you walk into our office is the café bar that has a toaster right in the middle. Because I think that the smell of toast is one of the most beautiful smells for creating a sense of homeness and comfort and safety, and I think that, you know… Our office always smells of toast. It’s wonderful. [Laughter] You see there. So this is what happens when you walk in: you walk in, and there’s a coffee machine going, so it’s, again, this smell of coffee, and it’s the smell of toast that permeates the entire office. And it’s little things like that that make an office feel like home; it makes people want to work late nights.

I’ve covered this already. Create visual reminders of your culture. Now, this is something I’ve done more retrospectively. It wasn’t something that on day 1 I thought, “Right, what’s my culture, what are the letters, how do I draw those?” It was something that I did a couple of years into it and thought, “OK, what is it that we’ve created here? What is it that has organically come about because of the kind of people that I’ve hired? And how do I kind of visualize that or put some kind of memorable structure around it? And so we’ve got a wonderful visual designer on the company that’s created these beautiful murals and painted them on the walls and then painted them on our Skimlove signs, and there’s a beautiful kind of visual language that permeates our office, our website, our… what do you call it… swag products that we give at conferences. And again, it’s something that the team felt this sense of bond… unity with. They are proud to be identified by this kind of visual language. It’s these little things that you never think about that actually are so important to create a great culture and to attract people to work for you.

So, what are the kind of challenges of hiring when you have no money? So this is… I’ve talked about how you can hire cheaply in those early days, but it doesn’t come without problems. You’ve saved on money, but now you actually have to spend a lot of time overseeing. And I have to say that’s been one of the hardest things that I’ve had to go through with, you know, a young team. For a long time, the average age of our company was under the age of 25, which is exhausting. Oh, my God, these people, they constant… affirmation, what’s in it for me, and, you know, it’s draining. They’re very energetic. [Laughter] It comes at a price, so there is a lot of time that you now have to spend overseeing, guiding, reviewing, calming down, you know. It’s hard.

This is another really tricky one. Eventually you have to replace them. The great CTO that you hired was an engineer, and you called him a CTO because you needed to do that. One day you’re going to have to hire a replacement CTO that actually knows how to scale a business. I’ve had to do this in my business countless times, and it’s caused me incredible amount of inner pain, because you’ve got these people that joined that ascended in the company with you, that love this company, that are so proud of what they’ve achieved, and then you’ve got to go and hire someone above them, or that replaces them. And you’ve got to let them go or you’ve got to make them now report to someone else. And it’s really, really hard, but it is absolutely inevitable if you hire junior people when you don’t have a lot of money. And you just have to kind of toughen up and do it, but you also… I mean, the clever ones recognize that it’s an awesome opportunity for their career to learn from someone that’s done it before, that hopefully you’ve hired people that are humble enough to appreciate that they don’t know it all yet.

One of the other hard things that comes with hiring young people and starting very small is that eventually, when you do hire better people, you need processes, you need to grow up as a company, and you need processes and systems and performance reviews and management meetings and all these things that I hate, frankly, but you have to do, because you’re now a bigger company and that’s required of you. And there’s a little part of you that feels that that Peter Pan side of you is now dead, but it is what is needed to kind of grow a company and is an inevitable result of growing with younger employees.

And mistakes will often happen. I mean, you hire junior people that have never done it before, sometimes they’re going to, you know, screw up, and you have to be patient and understanding, and that can be hard. I’ve seen a lot of fellow entrepreneur friends of mine that have hired, again, junior people when they didn’t have a lot of money, and then they get really, really angry when they screw up. And I’m like, “Well, of course they did. You need to mentor them, you need to be there with them, and you’re going to have to expect that if you hire junior people that are not best of their breed yet, they’re not going to always be perfect, and you just have to accept that.” And you do.

So how have things changed with money? So now, you know, we’ve raised… We’re received a Series C fundraise, we’ve raised quite a lot of money, and there are some things that are better. I can now sleep at night a little bit. Gosh, in my early days, I remember that first year, our technology service would… When you’re on a website, it tracks when you click out of that site and click onto a product link, and it helps you make money from that. But I remember in those early days when our server architecture was terrible, we would bring down newspapers, really important (I’m not going to say their names in case it comes out to them), but they were national newspapers that ran our technology, and for like two hours, we killed every single one of their outbound links. And so that was a very unpleasant two hours of my life. And now that we’ve hired excellent people that know how to set up redundancies and all sorts of necessary technical architecture, I can now sleep at nights a little bit more. A little bit more.

The other great thing that happens is that you hire people that are much smarter than you, and again, you have to be humble enough as a leader to know that that’s actually a really good thing. There, it’s awesome when you hire people who know a lot more than you do, and that you… I actually tell them, “Tell me what you need to lead you, because I can’t actually tell you how to do your job. I can just tell you what the overall vision is, and kind of what the expectation is, but everything else you need to tell me.” And that’s a really nice aspect of hiring senior people that have done it before.

The other unexpected… I thought it would be really hard to bring in senior people. What if it would destroy the culture, hiring these older people? Our average age is now a much more sensible age. To my wonderful surprise, it’s actually been a reason that people stay, because they’re excited to work for someone that is senior and experienced and can teach them something, and they now have a role model they can aspire to. And if you hire those senior people well, like our VP of sales in BizDev, our VP of engineering, our VP of marketing, these are people that now people want to work for. And they’re actually, yeah, a great piece of branding for our company, and it’s an unexpected benefit that happens when you hire awesome senior leaders.

But the focus on…

The one thing that hasn’t changed is that the focus on culture remains exactly the same, you know.

We still are dogmatic about hiring people that are good cultural fits and I still think day and night about, how do I create an environment where people want to stay, where people want to work, where the values that I find important are perpetuated without me having to do it. And yeah. That’s one of the joys of growing a team and a culture. And that’s it. Thank you very much. [Applause]

Next AMA: Clarke Ching, 23rd February 17.00 GMT.

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 Mark Littlewood: Thank you. Right. Some questions. Stick your hands up. Peldi you wouldn’t swear in an interview; why not?

Peldi: Huh?

Mark Littlewood: You wouldn’t swear in an interview.

Peldi: Well, I don’t swear much in general.

Alicia: Well, that’s all right, then.

Peldi: So I was just surprised…

Alicia: Well, it’s because for us, our cultural value was open-mindedness, so I needed to kind of test that on day 1. Are they going to be able to handle, you know, a lesbian manager, which is what they would have to put up with. Are they going to be able to handle a female boss, are they going… Those things that I look out for. For instance, if it’s me and another man interviewing them, are they only looking at the man in the eyes and not the woman? So they’re not going to deal well with a female environment. There are little things that you spot and see that, when you identify what’s important to you as a culture, you start to look for in an interview. And for us, yes, the ability to kind of handle a joke, you know, is a really important attribute, and so we wanted to test that out at the very beginning.

Mark Littlewood: Cool, Mark

Mark A: Hi, my name’s Mark. I’m offering a 20% discount today. [Laughter] To follow up on that, actually, my brother has hired people and had to fire them, and there have been… I mean, we live in the United States, which is very litigious, so any sort of swearing or even asking about family in an interview can lead you into a lawsuit later on. So, obviously, you’re subject to different rules, perhaps, but I just wanted to hear from you, since you’ve had to fire a number of people or transition them out, can you tell us about some things that didn’t go well at all and how you managed it, both personally and logistically?

Alicia: Yeah, good question. I mean, also, one of the other things that is important to us as a culture is that we’re very good to each other. That we create an environment of love and protection, and that people know that they’re going to be taken care of. So even the people that I’ve had to fire, we’ve thought to do so in as gracious a manner as we good. So, we would often tell them, “This is going to happen, but it’s not because of you, it’s because where we’re going is not conducive to the kind of skills that you have,” and we come up with a way… we let them essentially resign, so that they don’t have the shame of having to be kind of stopped out. And we arrange a very generous package, and it’s a really gracious thing, to the point where I’m still friends with the people that I have fired, as a result. They’re the good ones. There have been some cases where it’s… they’ve not been as understanding, and they’ve been angry, but we’ve always followed all the rules for letting people go, and it’s never been a problem for us.

It’s actually harder to let people go in the UK, where the laws make it very, very difficult to do so. In the US it’s much, much easier, and we’ve never had any kind of major… any litigious issues, at all, I think, if we approach it in a gracious manner and we’re very, again… There are things that I’m generous with, and so, you know, flying people over to meet face to face, I think that’s an expense worth doing, and letting people go graciously, especially if they’ve been a good member of the team, I think is another thing that I’m happy to spend money on. And then in other cases, there have been cases where we’ve had to let people go because they’ve been drunk at work, or… badly so, or have been quite violent, aggressively violent, and they’re easier to do in a way, because it’s like, “That’s it, you’re gone. It’s out.” But I think if you just manage it graciously, we really are very, very proud of acting in a manner that we’re proud of and wouldn’t be ashamed of, and it’s never been a problem for us. But yeah.

Arielle: Hi, I’m Arielle from Axosoft, and you talked a little bit earlier about some of your growing pains in creating processes, and I’m just curious, as you were going through that, how did you come up with processes, and how did you know how much process to create? I’m just sort of curious about what you did.

Alicia: Process is one of the things that I’m naturally not good at, and so we’ve made a lot of mistakes along the way. And I think that what we’ve tried to do is be very open about, you know, is this working, is this a good meeting, is this a good use of our time, what can we do to improve it. And so, a good example of things like our goal-setting, we’ve gone through probably five different iterations on how to do it, and it’s a constant kind of evolution to make it work with our team, but I find that very, very… It doesn’t come naturally to me, and I now actually hire people that are better at that. And it’s funny, as the years have gone on, I’ve created an environment where I’m allowed to be a little bit batty in a little bit kind of irregular… and I’ve got a wonderful team of managers that bring in the process and the structure, and almost tell me what to do. And that’s worked very well, because I know that that’s not my strength, so I hire people that are good at that side of things.

And I think we can probably still do better, and I think that there’s… I think the key is not to adopt a process just because someone else has done it and it’s worked for them. What we’ve tried to do… what do you call it… OKRs, which is a form of goal management, and it just didn’t work for us, so we kind of evolved it to be suitable for us and it’s been a much better process. Same with agile, same with a few other processes that we tried and thought, “You know what, let’s evolve it.” It goes back to our company anthem, you know, “Go Your Own Way”. I prefer… I hate doing things just because someone else says that’s the way to do it. I’d rather take inspiration and make something our own. And that goes for processes as well.

Arielle: Thank you.

Des Traynor: How do you manage to keep all this consistent across two offices?

Alicia: The first… I learned a lot about this. The first thing to do, when we set up our San Francisco office, is I moved over and I brought over two people from the London office. So our first foreign office was seeded with cultural ambassadors, I call them, so the people that were the kind of firmest representations of our company culture, and we hired from thereon. And then we spend… we make sure we do all company meetings at the same time, and we spend a lot of money flying people back and forth. It is one of those problems where you throw money at it, and it’s an important thing to do, and it’s still hard. That poor San Francisco team… We try really, really hard and they still sometimes feel very much like the satellite office, but it’s something that we’re incredibly conscious of, and work out every single day. Also spend a lot of money on good telecommunication equipment. It’s the only way to do it. But every office that we start, we seed with original cultural ambassadors, and we also do secondments, so every month we send someone from our London office to work a week out of our San Francisco office and it’s kind of a perk, and they love it; they get to hang out in San Francisco and be part of that scene. Our San Francisco team love it because they get a constant stream of visitors, and it’s really fun, and it creates awesome ties between the two offices.

Mark Littlewood: Fabulous. This is going to be a short question and a short answer.

Dan: Hi, I’m Dan from Sterling Medical Devices. I feel like you gave me permission to hire an HR person. I have 55 people, and the advice I’ve been given is, don’t do it until you’re 100, 120.

Alicia: That is so wrong. [Laughter]

Dan: They want to keep outsourcing HR functions, so…

Alicia: Oh, well, I never understand that.

Dan: I don’t either, and actually I appreciate what you said, so my question is, what do you look for in an good HR person, what kind of background?

Alicia: Good question. We’re actually… one of my… Our first of the HR hire, she ended up… she was in London, she was this lovely German girl, Austrian girl, and her husband moved to San Francisco, so she moved with him. And she worked remotely for us for a year, and then it was actually just too hard for her to be running, being a HR person for a team when she was a remote person herself, so she left, and we’re now trying to hire her replacement, and so what we are looking for, you want someone that understands policies and can do that kind of side of things, but the secret to a good HR person is that they also embrace culture, and that they’re not just the person that knows the right way to fire a person, the right way to set up a benefits package, that’s the admin bit of the job. The really special bit is, are they good at identifying that special something? Can they be both good at firing people but good at hiring people? Can they be the person that can lead your induction? Are they the kind of person that you would want to do that first interview when someone come… joins the company and also be the first person that greets that person on their first day of work?

And so we look for someone that is very structured and process-oriented but that is awesomely empathetic, and has a very strong warmth about them. And I think that’s what people get wrong about when they think about HR. It’s not about just the admin and the process side of things — it’s about creating your team, it’s about creating that culture. Every single person that you hire adds another brick to that kind of cultural building of yours, excuse my metaphor, and if you get any of those wrong it becomes an ugly house, to continue that metaphor, and it’s such an important… I think we should have hired ours  even sooner than 20 people.

 Mark Littlewood: Thanks. [Applause]

Next AMA: Clarke Ching, 23rd February 17.00 GMT.

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One response to “How To Grow and Scale A Culture with Limited Funds | Alicia Navarro | BoS USA 2014”

  1. […] Alicia Navarro: How to Grow and Scale a Culture With Limited Funds […]