I heard two great lines recently applied to CEOs that are thought provoking when you look at them together:

You have to care about everything more than anything

and

You can do anything you want but not everything you want

Being a CEO means you are accountable for everything that happens in your organization. That’s why you have to care about everything. People. Product. Customers. Cash flow. Hiring. Firing. Board. Fundraising. Marketing. Sales. Etc. You can never afford not to care about something in your business, and even if there’s a particular item you’re more focused on at a given point in time, you can never get to a place where you care about any one particular thing more than the overall health of the business.

But caring is different than doing. As a CEO, even if you’re hyper productive, you can’t do everything you want to do – and you shouldn’t. Others in your organization have to take ownership of things. And you can’t burn yourself out or spread yourself too thin. But you do have the prerogative of doing anything you want in and around your company as long as you do it the right way.

This second line is particularly interesting when applied to a CEO’s activities outside of work. As with anyone, it’s critical for CEOs and founders to have outside hobbies and interests, time for friends and family, down time, and even non-work work time like sitting on outside boards. Staying fresh and “sharpening the saw” is good for everyone. A CEO should be able to do anything she wants outside of work — from sitting on outside boards to being in a band. But a CEO can’t do everything she wants outside of work while still devoting enough time and attention to work.

Taken together, the two lines are interesting. As a CEO, you have to care about everything, but you can’t do everything. That pretty much sums up the job!

Comment on Political versus Corporate Leadership, Part II: Admitting Mistakes

My colleague Mike Mayor writes:

So you’e only asking for politicians to be honest Matt? Is that all? 🙂

Couldn’t agree more on the CEO side. A CEO who cannot admit to failure is doomed to be surrounded by “yes men” and, therefore, must go it alone, whereas the CEO who admits to having the odd bad idea every now and then is more likely to get truthful and accuruate information from those around him/her. Which scenario would you prefer to base your next decision on?

However, I look more to Hollywood for fostering the faux CEO/Board Room stereotypes, not politics. Look no further than the highest ranked show among 18 to 46 year olds: The Apprentice. Trump is just one contemporary example of successfully perpetuating the “kill or be killed” mentality of the ideal CEO. In his book, “How to Get Rich” one of his lessons is to “never take the blame for anything” (meanwhile Trump gets rich by being a caricature of a CEO).

The ideal CEO needs to set the example for the behavior of his employees, and creates opportunities by building relationships not “squashing the competition.” And like it or not, the ideal Board Room is actually a Think Tank of great minds working toward a common goal rather than a place to play mind games and mental poker.

Unfortunately, both of these things make for a horrible TV show but do contribute to building truly great companies! On the other hand, watch too many TV shows (or follow the politician’s lead) and you’ll likely become a CEO whose success is comparable to the CEOs of Enron and Tyco.

Parenting and Corporate Leadership

Let me be clear up front:  I do not think of my colleagues at Return Path as children, and I do not think of Casey, Wilson, and Elyse as employees.  That said, after a couple weeks of good quality family time in January, I was struck by the realization that being a CEO for a long time before having kids has made me a better parent…and I think being a new parent the last three years has made me a better CEO. 

Here's why.  The two roles have a heavy overlap in required core interpersonal competencies.  And doing both of them well means you're practicing those competencies twice as many hours in a week than just doing one – and in different settings.  It's like cross training.  In no order, the cross-over competencies I can think of are…

Decisiveness.  Be wishy washy at work, and the team can get stuck in a holding pattern.  Be wishy washy with kids, they run their agenda, not yours.

Listening.  As my friend Anita says, you have two ears and one mouth for a reason.  Listening to your team at work, and also listening for what's not being said, is the best way to understand what's going on in your organization.  Kids need to be heard as well.  The best way to teach good verbal communication skills is to ask questions and then listen actively and attentively to the responses.

Focus.  Basically, no one benefits from multitasking, even if it feels like a more efficient way of working.  Anyone you're spending time with, whether professionally or at home, deserves your full attention. The reality is that the human brain is full of entropy anyway, so even a focused conversation, meeting, or play time, is somehow compromised.  Actually doing other activities at the same time destroys the human connection.

Patience.  For the most part, steering people to draw their own conclusions about things at work is key.  Even if it takes longer than just telling them what to do, it produces better results.  With kids, patience takes on a whole new meaning, but giving them space to work through issues and scenarios on their own, while hard, clearly fosters independence.

Alignment.  If you and your senior staff disagree about something, cross-communication confuses the team.  If you and your spouse aren't on the same page about something, watch those kids play the two of you off each other.  A united front at the top is key!

I'm sure there are others…but these are the main things that jump to mind.  And of course one can be great in one area without being in the other area at all, or without being great in it.  Are you a parent and a business leader?  What do you think?

(This post also appeared on Bolster.com and builds on last week’s post where I introduced my new startup, Bolster)

Welcome to Bolster, the on-demand executive talent marketplace. We are creating a platform that is the new way to scale an executive team and board.

We believe that startups and scaleups are not average companies. Their rapid growth means their appetite for talent constantly outstrips their budget — and that they can’t spend months searching for it. Their dynamic industries dictate that they keep pace with bigger and better funded competitors. Their leadership teams — the people and the roles — are always changing. Their CEOs spend a ton of time hiring and coaching their leaders and shaping the complexion and direction of the team. They stress out about big expensive new executive hires when sometimes they just need to level-up an existing manager or “try before they buy.” Their Boards frequently jump in to help, but those efforts can be a little ad hoc and inefficient.

We believe that experienced executives working as consultants is the wave of the future. The number of career executives who work flexibly and on-demand for a living is skyrocketing in recent years. People are more often “between things” and are interested in plugging into shorter-term engagements while continuing to look for their next full-time role. People are retiring younger, yet wanting to keep contributing. And even fully-employed execs like to advise companies and serve on Boards. Whether these people are career consultants or are looking for a “side hustle” or just to pay something forward to a future generation of leaders, they all have two common problems: finding work is time consuming and they’re often not good at or don’t like doing it; and managing their back office, everything from insurance to legal to tax to marketing, is a drain on time that could otherwise be spent with clients or family.

We believe that a new kind of talent marketplace is needed to meet the unique and complex requirements of both audiences — the freelance, or flexible, seasoned executive, and the startup or scaleup CEO who thinks holistically about his or her leadership team and carefully tends them like a garden. We are building a platform to make instant, tailored, vetted matches between talent and companies without the randomness of a job board and without the theater, long lead times, and cost, of a full service agency 

Service marketplaces like ours work best when they help their stakeholders solve other meaningful, related problems.In this case, we believe that the need for back office services will help executive consultants focus on more important things. And we believe that CEOs need lightweight and dynamic support in thinking through the composition and skills required of their executive teams both today and 6-18 months in the future.

That is the essence of the business we are building. A business to quickly match awesome companies with awesome freelance executives and to help both sides be better at what they do. We are here to make it easier for you to:

• Bolster your executive team. For our Clients, our pledge to you is that we will quickly and cost-effectively fill the gaps in your leadership ranks (whether interim, fractional, advisory, board, or project-based) with trusted, curated talent, and that we will give you a platform to evaluate your overall leadership team and help you think through your future needs as your company evolves. Think of us as a shortcut to scaling your leadership team.
  
• Bolster your board. The best boards are the ones with multiple independent directors who come from diverse backgrounds with diverse points of view. We also pledge to our Clients that we will find great matches to help fill out their boardrooms as their strategic advisory needs change over time.
  
• Bolster your work. For our Members, our pledge to you is that we will find you the right kind of interesting clients and help you manage your back office so you can focus on your work (and all the other important things in your life!).
  
• Bolster your portfolio. For our Portfolio Partners, VC and PE board members, our pledge to you is that we will make it easier for you and your firm to both drive successful on-demand executive placements for your portfolio company CEOs, and to manage and expand your firm’s network of flexible executive talent. 

We are an experienced team of entrepreneurs and operators who have scaled multiple businesses throughout our careers. All of us worked together as part of the leadership team at Return Path, a leading email technology company that we scaled from 0 to $100mm in revenue and 500 employees in 12 locations around the world while winning numerous Employer of Choice awards. All of us have independent experience scaling other businesses, small and large, public and private. All of us have experience being on-demand executives as well — whether interim, fractional, advisory, project-based, or board roles, we know the landscape of both our members and our clients. 

We’ve all dealt with the stress of having product-market fit and market opportunities but not being able to capitalize on those opportunities because we were missing key talent. And we’ve tried everything from executive search firms (expensive, time-consuming, and slow), to leveling up people (will they be able to grow into the role?), to leaning in to our board (hit or miss, inefficient). Heck, we’ve been desperate enough to follow up on the “my cousin’s boyfriend has an uncle, and he might know someone” lead.

We believe there is a better way for startups and scaleups to find executive talent. Along the way, I published a book about scaling startups called Startup CEO: A Field Guide to Scaling Up Your Business that has sold over 40,000 copies to CEOs around the world. And our whole team is working on a new book called Startup CXO: A Field Guide to Scaling Up Your Teams, which is coming out in early 2021. Our team has a maniacal focus on helping startup teams scale and flourish and on helping leaders develop into the best version of themselves. That’s what we’re all about. 
Plus, we have an amazing group of investors behind us who know how to grow businesses like ours and have incredible reach into the startup and scaleup world. More about that later. For now, we are excited to soft launch Bolster and begin unleashing the power of on-demand executive talent to our Clients. Thank you for being on this journey with us. If you’re interested in the somewhat unusual story of how the company was founded, it’s here.

The Gift of Feedback, Part II

I’ve written a few times over the years about our 360 feedback process at Return Path.  In Part I of this series in early 2008, I spelled out my development plan coming out of that year’s 360 live review process. I have my new plan now after this year’s process, and I thought I’d share it once again.  This year I have four items to work on:

1. Continue to develop the executive team.  Manage the team more aggressively and intentionally.  Upgrade existing people, push hard on next-level team development, and critically evaluate the organization every 3-6 months to see if the execs are scaling well enough or if they need to replaced or augmented
2. Formalize junior staff interaction.  Create more intentional feedback loops before/after meetings, including with the staff member if needed, and cultivate acceptance of transparency; get managers to do the same.  Be extra skeptical about the feedback I’m getting, realizing that I may not get an accurate or complete picture
3. Foster deeper engagement across the entire organization.  Simplify/streamline company mission and balanced scorecard through a combination of deeper level maps/scorecards, maybe a higher level scorecard, and constant reinforcing communication.  Drive multi-year planning process to be fun, touching the entire company, and culminating in a renewed enthusiasm
4. Disrupt early and often, the right way.  Introduce an element of productive disruption/creative destruction into the way I lead, noting item 2 around feedback loops

Thanks to everyone internally who contributed to this review.  I appreciate your time and input.  Onward!

Welcome to the new Return Path.

For a tech company to grow and thrive in the 21st century it must be in a state of constant adaptation. We have been the global market leaders in email deliverability since my co-founder George Bilbrey coined that term back in 2002. In fact, back in 2008 we announced a major corporate reorganization, divesting ourselves of some legacy businesses in order to focus on deliverability as our core business.  

 Since then Return Path has grown tremendously thanks to that focus, but we have grown to the point where it’s time for us to redefine ourselves once again.  Now we’re launching a new chapter in the company’s history to meet evolving needs in our marketplace. We’re establishing ourselves as the global market leaders in email intelligence. Read on and I’ll explain what that means and why it’s important.

What Return Path Released Today

We launched three new products today to improve inbox placement rate (the new Inbox Monitor,  now including subscriber-level data), identify phishing attacks (Email Brand Monitor), and make it easier to understand subscriber engagement and benchmark your program against your competition (Inbox Insight, a groundbreaking new solution). We’ve also released an important research study conducted by David Daniels at The Relevancy Group.

The report’s findings parallel what we’ve been hearing more and more recently. Email marketers are struggling with two core problems that complicate their decision making: They have access to so much data, they can’t possibly analyze it fast enough or thoroughly enough to benefit from it; and too often they don’t have access to the data they really need.

Meanwhile they face new challenges in addition to the ones email marketers have been battling for years. It’s still hard to get to the inbox, and even to monitor how much mail isn’t getting there. It’s still hard to protect brands and their customers from phishing and spoofing, and even to see when mail streams are under attack. And it’s still hard to see engagement measurements, even as they become more important to marketing performance.

Email Intelligence is the Answer

Our solution to these problems is Email Intelligence. Email intelligence is the combination of data from across the email ecosystem, analytics that make it accessible and manageable, and insight that makes it actionable. Marketers need all of these to understand their email performance beyond deliverability. They need it to benchmark themselves against competitors, to gain a complete understanding of their subscribers’ experience, and to accurately track and report the full impact of their email programs.  In fact, we have redefined our company’s mission statement to align with our shift from being the global leader in Email Deliverability to being the global leader in Email Intelligence:

We analyze email data and build solutions that generate insights for senders, mailbox providers, and users to ensure that inboxes contain only messages that users want

The products we are launching today, in combination with the rest of our Email Intelligence Solution for Marketers that’s been serving clients for a decade, will help meet these market needs, but we continue to look ahead to find solutions to bigger problems. I see our evolution into an Email Intelligence company as an opportunity to change the entire ecosystem, to make email better, more welcome, more effective, and more secure.

David’s researchoffers a unique view of marketers’ place in the ecosystem, where they want to get to, how much progress they’ve made, and how big a lead the top competitors have opened up against the rest. (It can also give you a sense of where your efforts stack up vs. the rest of the industry.) There are definitely some surprises, but for me the biggest takeaway was no surprise at all: The factors that separate the leaders are essentially the core components of what we define as Email Intelligence.

Please, Keep Not Calling (Thank You!)

It’s been three years since the federal government passed one of its better pieces of legislation in recent memory, creating the Do Not Call Registry which is a free way of dramatically reducing junk phone solicitations.  At the time, registrations were set to expire every three years.  When I signed up my phone number, I stuck a note in my calendar for today (three years later) to renew my registration.  I was planning on blogging about it to remind the rest of the world, too.

To my great surprise, when I went to the site today, I saw this note:

Your registration will not expire. Telephone numbers placed on the National Do Not Call Registry will remain on it permanently due to the Do-Not-Call Improvement Act of 2007, which became law in February 2008.

That’s two great pieces of legislation.  What will they think of next?

It’s Copyright Time

Brad must be off his game this year, so…time to update all those copyrights to say 2008.  Or as Brad gently suggested last year, make that field variable so you never have to worry about it again!  (Thanks to our CTO Andy Sautins for the reminder here.)

More Good Inc.

Last year I was pleased and proud to write about our debut on the Inc. 500 list of America’s fastest growing companies.  At that time I wrote that “Now our challenge, of course, is STAYING on the list, and hopefully upping our ranking next year!”  Well, I am again please and proud to announce that we, in fact, stayed on the list.  (You can read all the Inc. coverage here and see our press release about the ranking here.)

Unfortunately, we didn’t make the second part of our goal to up our rank.  But, we did up our growth – our three-year revenue growth rate was 18% higher than last year.  This is a testament to the hard work of our team (now 150 strong!) and wouldn’t be possible without the support of our many great clients (now 1,500 strong!).  Most importantly, we see no end in sight.  In fact, 2008 promises to be an even bigger year for us as we poise for continued growth.  By the way, would you like to be part of a team that has now ranked as one of America’s fastest growing companies two years in a row?  Check out our Careers page and join the team that is advancing email marketing, one company at a time.

We were excited to close the sale of our Consumer Insights business last week to Edison, as I blogged about last week on the Return Path blog.  But it brought back to mind the great Yogi Berra quote that “it ain’t over ’til it’s over.”

We’ve done lots of deals over our 18 year existence.  Something like 12 or 13 acquisitions and 5 spin-offs or divestitures.  And a very large number of equity and debt financings.

We’ve also had four deals that didn’t get done.  One was an acquisition we were going to make that we pulled away from during due diligence because we found some things in due diligence that proved our acquisition thesis incorrect.  We pulled the plug on that one relatively early.  I’m sure it was painful for the target company, but the timing was mid-process, and that is what due diligence is for.  One was a financing that we had pretty much ready to go right around the time the markets melted down in late 2008.

But the other two were deals that fell apart when they were literally at the goal line – all legal work done, Boards either approved or lined up to approve, press releases written.  One was an acquisition we were planning to make, and the other was a divestiture.  Both were horrible experiences.  No one likes being left at the altar.  The feeling in the moment is terrible, but the clean-up afterwards is tough, too.  As one of my board members said at the time of one of these two incidents – “what do you do with all the guests and the food?”

What I learned from these two experiences, and they were very different from each other and also a while back now, is a few things:

• If you’re pulling out of a deal, give the bad news as early as possible, but absolutely give the news.  We actually had one of the “fall apart at the goal line” deals where the other party literally didn’t show up for the closing and never returned a phone call after that.  Amateur hour at its worst
• When you’re giving the bad news, do it as directly as possible – and offer as much constructive feedback as possible.  Life is long, and there’s no reason to completely burn a relationship if you don’t have to
• Use the due diligence and documentation period to regularly pull up and ask if things are still on track.  It’s easy in the heat and rapid pace of a deal to lose sight of the original thesis, economic justification, or some internal commitments.  The time to remember those is not at the finish line
• Sellers should consider asking for a breakup fee in some situations.  This is tough and of course cuts both ways – I wouldn’t want to agree to one as a buyer.  But if you get into a process that’s likely to cause damage to your company if it doesn’t go through by virtue of the process itself, it’s a reasonable ask

But mostly, my general rule now is to be skeptical right up until the very last minute.

Because deals are not done until they are done.

(This post also appeared on Bolster.com)

As we wrote in our Founding Manifesto, Bolster was started in part to create a new way for startup and scaleup CEOs to think about growing their leadership teams.

Why do CEOs need help with this?

CEOs of any company have too many things to do at all times. This is even more true at startups and scaleups, which by definition are more fast-paced, dynamic, CEO-driven, and thinly staffed. All those challenges point directly to the specific challenge CEOs have with their leadership team.

Think about the journey of a company from a founding team to 50 employees. My long time friend and former board member Greg Sands once compared the phenomenon

of companies growing out of the startup stage to cell development in small organisms. Amoeba or paramecia consist of one cell, and that cell has to do everything: eat, move, sense its surroundings, and respond accordingly. When the cell divides, the new cells still need to do everything – they’re just attached to other cells. As organisms grow more complex, individual cells need to specialize. And when things get really complex, you need a liver, a spleen, a stomach, and a pancreas. By and large, startups work the same way. In the early stages, you have to hire generalists who are both willing and able to take on dozens of tasks at once. Your developers will have to speak with potential customers; your accountants will have to give advice on product direction; and the born salesperson on your team will need to put the phone down a few hours a day and set up a new employee’s computer. That’s a really different team than when you need functional managers on top of engineering, sales, etc. — not to mention needing strategic leadership of those functions as the company grows from 50 to 100 to 250 to 500 employees.

That’s the journey that startup and scaleup CEOs are on. It’s less of a journey and more of a roller coaster ride. Jason is running HR today…but tomorrow, the job of “head of HR” will be different, and Jason might or might not be capable of it. Then your VP Finance Sally gets lured away by an even hotter and sexier new startup and leaves a sudden, gaping hole on your team. Then cracks start to show up with the job Jamie is doing as your marketing director and you lose confidence that your upcoming product launch is going to be a success. Every time one of these events happens – whether it’s an actual event, or just an “aha moment” for you as CEO, you add something to your plate. You add tasks to take over work yourself. You add the task of finding a new person. You add stress from having to deal with one more critical thing.

Leveling up a leadership team is probably the hardest part of the CEO’s job. 

Why don’t current solutions meet the CEO’s needs? Well, of course they do, sometimes. The problem is that the current solutions either aren’t tailored to the needs of startup or scaleup CEOs, or they’re ad hoc and inefficient. Executive search is slow and expensive, and it produces expensive full-time executives. And no matter how good an executive search firm is, I’ve never met a CEO who has a better than 50% success rate in hiring new leaders from the outside. Ever. Add all that up – expensive, slow, medium success rate, and perhaps most important for a startup CEO, leaving you with expensive full-time headcount in multiple areas of your company – that is not a recipe for startup success when you’re sweating your burn rate.

Frequently, the CEO just taps her network for execs or for on-demand executives like the ones Bolster places — that could be asking board members or friends or advisors for suggestions. Quite frankly, those suggestions stand a better chance of success than transactional executive search since the candidate referral source is usually somewhat of an insider. But those searches are really disorganized or one-off. When a CEO turns to their network for spot help, they often aren’t running a comprehensive process, creating a serious job spec, seeing a broad set of candidates for comparisons, and the like. 

Our job at Bolster is to make all of this easier and lighter weight. The rise of the gig economy means that startups no longer need to rely on the painful binary choice of “the person/opening I have today” and “the expensive full-time exec coming in from the outside.”The new way to scale an executive team is with a mix of interim executive talent to quickly fill gaps, fractional executive talent to provide strategic oversight and guidance to a team, part-time, functional mentors/coaches/advisors to advise a less experienced functional leader, project-based consultants to fill in specific holes, and yes, the occasional full-time outside hire, possibly via a search firm (or if your fractional CXO loves your company and joins full-time!). 

With Bolster, you have a network of all those types of talent, well curated and well profiled, available for near-instant matches and near-instant start dates – and a suite of tools and services designed to help you proactively identify your needs across all your functional areas so you’re never scrambling your way out of a tight spot.

What about the existing team? If you’re a leader inside a startup or scaleup, Bolster is ALSO created for you. The painful binary choice CEOs face that I wrote above is particularly painful for you if you’re no longer scaling quickly enough. Frequently, promising junior people are layered or shuttered aside because the CEO doesn’t have the time, or the functional expertise required, to coach or mentor the person to success. Bolster creates an easy mechanism for CEOs to help pinpoint the areas in which you need growth and development as well as an easy way to find either temporary leadership or a function-specific advisor/mentor/coach to help you grow with the role and with the company.

The best startup CEOs I know are the ones who are already using multiple types of on-demand talent at the same time to help their companies along that journey from single-cell to complex organisms. I believe three years from today, the frequent usage of this kind of talent will move from the realm of early adopters to mainstream. The ones who embrace it first will have a competitive advantage.