Run, Brad, Run!

A few years ago we announced our support of a charity called the Accelerated Cure Project for Multiple Sclerosis (see the post about it here and learn more about Accelerated Cure here).  While we have a strong culture of giving back to the community at Return Path and do that in several ways, we chose this charity as the main beneficiary of our corporate philanthropy efforts for three reasons:

1. We wanted to support research into finding a cure for MS to honor and support one of our earliest colleagues, Sophie Miller Audette who was diagnosed with MS about 5 years ago (and is still going strong as one of our key sales directors!) – and since then, two other members of the Return Path extended family have also been diagnosed with MS
2. We wanted to support an organization with a focused mission and one where our contributions could really make a difference
3. Accelerated Cure has a very entrepreneurial, innovative culture that’s consistent with our own – and a solution-oriented approach to their cause that resonates with our business philosophy

We got introduced to Accelerated Cure by Brad Feld, one of Return Path’s venture investors, who is a friend of Art Mellor, Accelerated Cure’s founder and CEO.  Brad’s an interesting guy for many reasons, but one reason is that he has a goal of running 50 marathons (one in each state) by the time he’s 50.  He has eight years and 40 marathons to go, and to make it a little more significant he decided to try and drum up some sponsorships for his quest and donate the money to Accelerated Cure. 

Return Path has decided to be one of Brad’s anchor tenant sponsors by pledging $1,000 for every race he completes.  This is half of Brad’s goal of $2,000 per race, and we hope it will inspire others to donate so he can beat his goal.  Of course, Brad wants to do more than just run these marathons – he wants to, well, accelerate his performance.  So, taking a page out of the VC handbook, we’re setting up an incentive program for Brad of an additional $500 donation for every race that he completes in less than four hours. 

Besides liking both Brad and Accelerated Cure, this particular vehicle for donating money is especially meaningful to us.  A good number of Return Path employees past and present have run marathons and even competed in triathlons and Ironman competitions (including yours truly, but in a way that certainly makes me want to keep my day job).  And Seth Matheson, Accelerated Cure’s new development director who has MS, is an avid marathoner who is contemplating an Ironman competition himself.  And as I always tell our team members, running a startup is a marathon, not a sprint!

You can follow Brad’s progress – and make a donation yourself – here.

Book Short (and great concept): Moments of Truth

TouchPoints:  Creating Powerdul Leadership Connections in the Smallest of Moments, by Douglas Conant, former CEO of Campbell’s Soup Corporation, and Mette Norgaard (book, kindle), is a very good nugget of an idea wrapped in lots of other good, though only loosely connected management advice around self awareness and communication — something I’m increasingly finding in business books these days.

It’s a very short book. I read it on the Kindle, so I don’t know how many pages it is or the size of the font, but it was only 2900 kindles (or whatever you call a unit on the device) and only took a few Metro North train rides to finish.  It’s probably worth a read just to get your head around the core concept a bit more, though it’s far from a great business book.

I won’t spend a lot of time on the book itself, but the concept echoes something I’ve been referring to a while here at Return Path as “Moments of Truth.”  Moments of Truth are very short interactions between you and an employee that are high impact and, once you get the hang of them, low effort.  At least, they’re low effort relative to long form meetings.

Here are a few thoughts about Moments of Truth:

• They are critical opportunities to get things both very right and very wrong with an employee
• They are more powerful than meets the eye – both for what they are and because they get amplified as employees mention them to other employees
• They can come to you (people popping into your office and the like), you can seek them out (management by walking around), and you can institutionalize them (for example, one of the things I do is call every employee on their Return Path anniversary to congratulate them on the milestone)
• They are no different than any other kind of interaction you have, just a lot shorter and therefore can be more intense (and numerous)
• Their use cases are as broad as any management interaction — coaching, positive or negative feedback, input, support, etc.

What can you as a manager or leader do to perfect your handling of Moments of Truth?

First, learn how to spot them when they come to you, and think about a typical employee’s day/week/month/year to think about when you can find opportunities to seek them out.  Their first day on the job.  When they get a promotion.  When they get a great performance review, or new stock options.  Maybe when they get a poor performance review or denied a promotion they were seeking.

Second, learn to appreciate them and leave space for them.  If you have zero free minutes in every single day, you not only won’t have time to create or seek out Moments of Truth, you’ll be rushed or blow them off when they come to you.

Finally, like everything else, you have to develop a formula for handling them and then practice that formula.  The book does talk about a formula of “head, heart, hand” (e.g., being logical, authentic, and competent) that’s not bad.  Although I’d never thought about it systematically before writing this post, I have a few different kinds of Moments of Truth, and each one has its own rhythm to it, and its own regular ending.

But regardless of how you handle them, once you think about your day through this lens, you’ll start seeing them all over the place.  Recognize their power, and dive in!

Agile Marketing

As I wrote about last week, Return Path has been using the Agile Development methodology and Rally Software as our product development framework for about a year now.  It’s worked so well for us, that the concepts, and even the tools, have started to spread virally to other parts of our business.

About two months ago, I took over our marketing department as interim CMO.  Our marketing efforts have become increasingly complex in the last year or so as we’ve grown and added multiple new product lines, and as a result, the demands on our relatively small department were becoming unmanageable.  As I wrote about a couple years ago, Marketing is like French Fries — you can always consume just a little bit more of it — and we were really feeling the strain on our marketing team.

As I thought about the challenges that faced our marketing efforts, they reminded me a lot of the challenges that faced our product development efforts before we implemented Agile/Rally for those teams.  Multiple external and internal stakeholders with competing priorities.  Poor communication.  Needing to be nimble and agile in a process that has some inherent long lead-time items.

So we tried an experiment — we tried implementing Agile Marketing.  We have learned a lot in the past couple of months and have adapted the processes a little bit to the needs of marketing, but our marketing planning, execution, and feedback cycles now look an awful lot like our engineering ones.  After one week struggling with an Excel spreadsheet, macros, and conditional formatting, we even decided to try using Rally to run our process, even though some if its terms and functionality are really designed for software development.

We now plan marketing in six-week “releases,” each of which has 1-2 core themes and a planning session up front with our head of sales and business GMs.  Each release has two, three-week “iterations” where we do mid-course corrections and track our marketing team members’ utilization on projects very deliberately in Rally.  Stakeholders can always go into Rally at any time and enter a “feature request” for a new marketing project, which we will schedule in at the next iteration.  The marketing team has a daily stand-up to review progress and identify roadblocks.  And we still have enough slack in the system that we can handle a couple of last-minute opportunistic items (love those French Fries) which invariably come up.

So far, so good.  Our marketing team has a much more solid plan of attack for its work, and we have been able to regain control of our marketing agenda, getting input and feedback from stakeholders to help shape it along the way.  Cross-group communication and transparency are way up, productivity is up, noise and friction are down.

It’s not perfect, but it’s a pretty good system, and we’ll continue to refine it along the way.  But it’s catching on…last time I checked, a third group at Return Path was about to dive in and try it as well — Agile Sales Operations and Business Analytics, here we come!

Doing Well by Doing Good, Part II

At Return Path, we feel strongly that companies can and should make the world a better place in several different ways.  Certainly, many companies’ core businesses do that — just look at all the breakthroughs in medicine and social services over the years brought to market by private enterprises, including my friend Raj Vinnakota, who I wrote about in part I of this series last year.  But many companies, including Return Path, aren’t inherently “save the world” in nature (although some people in online marketing would have you believe that we are!), and those companies can still make a difference in the world in a few ways:

1. Organize projects in the local community for their employees to help out/work at

2. Allow employees to take a limited amount of paid time off for community service work

3. Provide matching gift programs so employees’ donations are enhanced by the company

4. Donate money or services to charitable organizations they believe in

As a relatively small company, we have to pick our battles here.  We currently have a policy for #2 above that allows employees 3 days per year of paid time off for community service work.  And today, we are announcing a comprehensive program for #4 above in association with the Accelerated Cure Project for Multiple Sclerosis.  This choice was inspired by our long-time employee and friend Sophie Miller, who was diagnosed almost two years ago now with MS (and is doing great)!

Read the details of what we’re doing with Accelerated Cure in the full press release here.

ReturnShip Program

Today is a very exciting day for Return Path as we launch a new program we have been cooking for more than a year called the ReturnShip program. (Sometimes the name of our company comes in handy.)

Return Path has always had a significant commitment to building a strong and diverse organization as well as supporting and encouraging women to pursue careers in technical environments.  To this end, I’m very excited to share progress on our ReturnShip program: after a small pilot last year, our inaugural group of six female returnees will join Return Path in a variety of roles across the company as of today.

The ReturnShip is designed for women who have been out of the workforce for more than 1 year to re-enter and  build credible and relevant experience, and to feed our funnel of prospective employees.

The ReturnShip is 14-weeks long, during which each Returnee will own a project deliverable, learn about Return Path and get support from us in how to navigate today’s work environment.  We’re planning to hire 2-3 as employees at the end of the program (though as a practical matter, we will hire anyone who is great!), and for those who aren’t a match here, we plan to assist with connections and resume/interview reviews to find help them find a role externally.

We had an amazing response from applicants who hadn’t seen anything like this before.  We hope this program enables us to help the community and also find some hidden talent.  It will be a great learning experience for us, and we are very excited to get started.

On a personal note, although I cannot in any way take credit for dreaming up this program, I have felt the need for something like this a lot in the past 10-12 years in particular since getting married, having kids, and having a lot of friends and employees have kids for the first time. The number of immensely talented women who drop out of the workforce, or who struggle greatly with balancing work and home, is huge. Hopefully this program scales up and becomes a role model for other companies to make it easier for women who do take time off the work treadmill with their families to return to work either full time or part time. Reducing the hurdle of “I’ve been out of the workforce, so how do I get back into it?” feels like an important step.

I’ve written a few times over the years about our Sabbatical policy at Return Path, including this post and this post about my experience as CEO when one of my direct reports was on his sabbatical, and this post about my own sabbatical.

People ask me this all the time, so I thought I’d write the policy out here.  This is the language in our employee handbook about them:

You have big dreams. We know. This is your chance to cross something off your life list. Whether it’s climbing Mt. Everest, learning Russian or taking your kids across the country in a Winnebago, we believe in rewarding longevity at Return Path and know that a good long break will leave you refreshed and energized!  As such, you are eligible for a sabbatical after your first seven (7) years of employment; then again after every five (5) years incremental employment. The sabbatical provides you with up to six (6) weeks of consecutive time off provided you have that time off approved by your manager at least two months prior to the start of your sabbatical.

You will be requested to sign an Agreement before your sabbatical: if you do not return to work after your sabbatical or if you leave employment within twelve (12) months of returning to work, you will be required to reimburse all amounts received while on sabbatical.  If a holiday occurs on any of of the days of absence, you will not receive holiday pay in addition to your sabbatical pay.  During your sabbatical, your benefits will continue and you will be responsible for making payments for the employee portion of insurance costs if applicable. The period you are on leave will be counted as employment for the purposes of determining your applicable level of benefits.  If you are eligible and have not taken your sabbatical and your employment with Return Path ends (for any reason), you will not be paid out for sabbatical time not taken.

I also wrote an email recently to someone internally that is worth reprinting here, which is How to Prepare for Your Sabbatical, which is aimed at both the person taking the sabbatical, and the person’s manager:

As the employee:

–          Prepare your team

• Make sure their goals and metrics for your time out are super clear
• Make sure they know who to go to for what
• Set their expectations of management coverage (see below). 
• Remember that your manager has a day job so you should look to see how your team members can take over some of the responsibilities.
• Give them stretch goals while you’re out

–          Prepare your individual contributor work

• Hand off all loose ends with extra details. 
• Make introductions via email if your manager/team member  is going to have to work with external parties
• Can be to your team, to your manager, to someone else

–          Prepare your manager

• Brief your manager thoroughly on everything going on with your team, its work, your individual contributor work
• Good topics to cover with your manager:Discuss specifics of team and 1:1 check-ins and agree on a plan for coverage.
  • What are the big initiatives that you’ll need coverage on
  • Which team members would you like the manager to spend a little extra time with?  Are there any work you would like the manager to help a particular EE with?

–          Prepare yourself

• Plan any personal travel early so you get good rates!
• Figure out how to keep your work and personal communications separate – your email (autoresponder, routing, disabling from your smartphone), your voicemail if you use Google Voice or Simulscribe, etc.
• Block out two full days immediately when you return to catch up on email and catch up with your manager and team

As the manager:

–          Prepare your team

• Make sure the rest of your team knows your time will be compromised while you’re covering
• Figure out what kind of coverage you need (either internal or external) while you’re covering

–          Rearrange your calendar/travel

• Add new team meetings or 1:1s as it makes sense.  You don’t have to do exactly what your employee did, but some portions of it will make sense to pick up
• If your employee works in another office with members of his/her team, you might want to plan some travel there to cover in person
• It’s ok to cut back on some other things a bit while you’re covering – just remember to undo everything when the employee’s sabbatical is over

–          While you’re in charge

• Surprise your employee with how much you were able to keep things running in his/her absence!
• Learn as much as you can by doing bits and pieces of his/her job.  This is a great opportunity of the employee to get some value from a fresh perspective.

–          Prepare for your employee’s return

• Keep a running tab of everything that goes on at the company, critical industry news (if appropriate), and with your employee’s function or team and prepare a well-organized briefing document so your employee can hit the ground running when he/she returns
• Block out an hour or two each of the employee’s first two days back to review your briefing document

My main takeaway from this post?  I am overdue my second sabbatical, and it’s time to start thinking about that!

(This is the second post in the series….the first one When to hire your first CBDO is here)

One of the tricky things about finding a great CBDO is that the role is fairly nuanced and there’s not a degree a person can get in “business development.” So you’re left with searching for someone based partially on experience, reputation, and alignment with your company culture and goals. But over the course of my career I have figured our what “great” looks like for the CBDO and I’m confident that what worked for us at Return Path and Bolster will work for any startup.

First, a great CBDO should have a good balance of the three core components Ken Takahashi outlined in his section of Startup CXO.  Those three components include partnerships, M&A, and strategy.  Even if a person started their careers out as an investment banker or a management consultant, or some other specialized field, they should still be able to bring all three competencies to bear to help further the goals of their team – to optimize the company’s place in the ecosystem. A one-trick pony will get you nowhere in the ecosystem and the CBDO needs to be a competent generalist in a wide range of skills.

Second, a great CBDO will look at business strategy first before trying to solve a problem because a solution that doesn’t advance the strategy will fail. It’s not enough to be able to develop a strategy, the great CBDOs will return to that strategy constantly. If a CBDO is highly skilled at one of the components, say M&A, they are likely to risk becoming the the proverbial hammer in search of a nail and they will put a primacy on M&A deals. The strategy acts as a safeguard to pursuing something because the CBDO wants it amd instead helps them pursue something that fits with the overal strategic drivers of the business. So, strategy is king in the CBDO world.

Third, a great CBDO will see the whole system at a company, not just one thing. They’ll see product (and all of its components) as well as go-to-market (and all of its components). Like the CEO, CFO, and Chief People Officer, the CBDO needs to have a holistic approach to everything and not only be closely aligned with the market-facing organizations. 

You can find this post on the Bolster Blog here.

My cofounder Cathy wrote a great post on the Bolster blog back in January called Procrastinating Executive Development, in which she talks about the fact that even executives who appreciate the value of professional development usually don’t get to it because they’re too busy or don’t realize how important it is. I see this every day with CEOs and founders. Cathy had a well phrased but somewhat gentle ask at the end of her post:

My ask for all CEOs is this: give each of your executives the gift of feedback now, and hold each other accountable for continued growth and development to match the growth and development of your company.

Let me put it in starker terms:

Grow or Die.

Every executive, every professional, can scale further than they think is possible, and further than you think is possible. Most of us do have some ceiling somewhere…but it will take us years to find it (if we ever find it). The key to scaling is a growth mentality. You have to not just value development, you have to crave it, view it as essential, and prioritize it.

Startups are incredibly dynamic. You’re creating something out of nothing. Disrupting an industry. Revolutionizing something. Putting a dent in the universe. For a startup to succeed, it has to constantly put something in market, learn, calibrate, accelerate, maybe pivot, and most of all grow. How can a leader of a startup scale from one stage of life to the next without focusing on personal growth and development if the job changes from one quarter to the next?

I was lucky enough to have a great leadership team at my prior company, Return Path, over the course of 20 years. Within that long block of time with many executives, there was a particular period of time, roughly 2004-2012, that I jokingly refer to as the “golden age.” That’s when we grew the business from roughly $5mm in revenue to $50 or $60mm. The remarkable thing was that we executed that growth with the same group of 5-6 senior executives. A couple new people joined the team, and we struggled to get one executive role right, but by and large one core group took us from small to mid-sized. Why? We looked at each other — literally, in one meeting where we were talking about professional development — and said, “we have to commit to individual coaching, to team coaching, and to growth as leaders, or the company will outpace us and we’ll be roadkill.”

That set us on a path to focus on our own growth and development as leaders. We were constantly reading and sharing relevant articles, blog posts, and books. We engaged in a lot of coaching and development instruments like MBTI, TKI, and DISC. We learned the value of retrospectives, transparent 360s, and a steady diet of feedback. We challenged ourselves to do better. We worked at it. As one of the members of the Golden Age said of our work, “we went to the gym.”

The “Grow or Die” mantra is real. You can’t possibly be successful in today’s world if you’re not learning, if you don’t have a growth mentality. You are never the smartest person in the room. The minute you are convinced that you are…you’re screwed.

If you don’t believe me, look at the development of your business itself as a metaphor for your own development as a leader. What happens to your startup if it stops growing?

(You can find this post on the Bolster Blog here)

That’s not just the title of a mediocre 1980’s sitcom starring Tony Danza, it’s a question I get periodically, including last week in an interview. A writer I know is working on an article on entrepreneurship and asked me, “Before you started your own business, how did you like working for other people?”

The question made me think a little bit. I know what she was asking — how I liked being the boss instead of working for one — but the way she phrased it is interesting and revealing about what it’s like to be a CEO. One of the biggest differences between being in a company and starting or running one is that you’re not working for a person, you’re working for many people.

As CEO of the company, I work for a Board and shareholders, I work for our customers, and I work for our employees. That’s how I approach the job, anyway.

Return Path’s Board of Directors is my boss, even though I’m one of the people on it. I report to the Board, and the Board is responsible for hiring and (hopefully not) firing the CEO, so technically, that’s my boss. The Board is also made up (for small private companies, anyway) of representatives of our biggest shareholders. As the main owners of the business, they are concerned with the growth, profitability, and overall health of the company, and they want to make sure we are building shareholder value day in, day out. That’s one very important perspective for me to have every day.

But I also work for our customers. I have to see myself as serving them — and more important, I have to steer the organization to believe that our customers are at the top of our food chain. If I do, then things will go well in the business. We will have the right products in the market at the right time to bring in new accounts. We will have a tremendous service delivery organization that wows customers and keeps them coming back for more. We will beat out our competition any day of the week. We will keep people paying our bills!

Most important, though, I work for our employees. This is very simple. An organization thrives because the people who make it up come to work inspired, focused, and productive. When they don’t, it doesn’t. I can’t wave a wand and make everyone happy all the time, but I try to focus a significant part of my time on making sure this is a great work environment; that the managers and executives are religiously focused on developing, managing, and motivating their teams; and that we’re doing a good job of communicating our mission, our values, and why each person’s job is important to the cause. This one’s the hardest of the three to get right, but it’s worth the effort.

Certainly, I don’t respond to each of my “bosses” every day as I would a direct supervisor, but in the long haul, I have to balance out the needs and interests of all three constituencies in order to have the organization be successful.

A couple weeks ago, I blogged about some innovations we’d made in People practices around basic benefits. But that post raised questions for me like “Why do you spend money on things like that when all people care about is their salary? When they get poached by another company, all they think of it the headline number of their base compensation, unless they’re in sales and think about their OTE.”

While that is hard to entirely argue against, one thing you can do as you layer in more and more benefits on top of base salary, you can, without too much trouble, produce annual “Total Rewards Statements” for everyone on your team. We did this at Return Path for several years when we got larger, and it was very effective.

The concept of the Total Rewards Statement is simple. At the beginning/end of the year, produce a single document for each employee – a spreadsheet, or a spreadsheet merged into a doc, that lists out all forms of cash compensation the employee received in the prior year and also has a summary of their equity holdings.

For cash compensation, start with base salary and any cash incentive comp plans. Add in all other classic benefits like the portion of the employee’s health insurance covered by the company, any transit benefits, gym memberships or wellness benefits, 401k match, etc. Add in any direct training and development expenses you tracked – specific stipends, training courses, conferences, education benefits, subscriptions, or professional memberships you sponsored the employee attending. All of that adds up to a much larger total than base salary.

If you have some other program like extensive universally available and universally consumed food in the office (or a chef, if you’re Google), you could even consider adding that to the mix, or perhaps having a separate section for things like that called “indirect benefits” so employees can see the expenses associated with perks and investment in their environment.

Finally, put together a summary of each employee’s equity. How many options are vested? Unvested and on what schedule? What’s the strike price? What’s the value of the equity as of the most recent financing? What’s the value of the equity at 3 other reasonable exit values? Paint the picture of what the equity is actually likely to be worth some day.

Yes, you could do these things and still lose an employee to Google or whoever offers them $50k more in base salary. It happens. But if you’re doing a great job with your culture and your business and people’s roles and engagement in general, having a Total Rewards Statement at least makes it easy for you to remind employees how much they *really* earn every year.

Book Short:  Worth Buying Free

The cynic in me wanted to start this book review of  Free: The Future of a Radical Price, by Chris Anderson, by complaining that I had to pay for the book.  But it ended up being good enough that I won’t do that (plus, the author said there are free digital versions available — though the Kindle edition still costs money).  At any rate, a bunch of reviews I read about the book panned it when compared to Anderson’s prior book, The Long Tail (post, link to book).

I won’t get into the details of the book, though you’ll get an idea from the paragraph below, but Anderson has a few gems worth quoting:

• Any topic that can divide critics into two opposite camps — “totally wrong” and “so obvious” — has got to be a good one
• Free makes Paid more profitable
• Younger players have more time than money…older players have more money than time
• Doing things we like without pay often makes us happier than the work we do for a salary
• It’s true that each generation takes for granted some things their parents valued, but that doesn’t mean that generation values everything less
  

While Free is s probably not quite as good as The Long Tail, it does a good job of organizing and classifying and explaining the power of different economic models that involve a free component, and I found it very thought provoking about our own business at Return Path.

We already do a couple forms of Free — we practice the “third party” model, by giving things away to ISPs but selling them to mailers; and we practice Freemium by providing Senderscore.org and Feedback Loops for free in order to attract paying customers to our testing and monitoring application and whitelist.  But could we do others?  Maybe.  They may not be revolutionary, but they’re smart marketing.

As some of the reviewers write, the book isn’t the be-all-end-all of marketing, it overreaches at times, and it is more applicable to some businesses than others, but Free was definitely worth paying for.