This was a big week for Return Path.  First we announced a $35mm financing led by an exceptional private equity firm that I’d never heard of before the middle of the fundraising process a few months ago.  We are happy to have them join our very strong board and syndicate and even happier to have additional investment capital to accelerate our growth, especially in newer businesses for us like Email Fraud Protection and our overall data and analytic capabilities.

But in some ways even more important, or at least more sentimentally important news this week is that tomorrow, December 6, marks the 15th anniversary of Return Path’s founding.  A decade and a half with probably over 800 employees in total over time in a dozen locations and several thousand clients worldwide.  We’ve “served” over 30 million consumers, including some of our legacy businesses like ECOA, Postmaster Direct, and Authentic Response, as well as our current panel.  Preparing for our annual year-end all-hands meetings over the next couple weeks was a fun exercise this week in pulling up, diving into lessons learned from this past year (and more), and trying to crisply articulate our vision for the next few years.

The next leg of our journey is going to be interesting and quite different from the past in many ways, though of course some things, like our values and spirit, won’t change.  Lots of aspects of our jobs will.  But that’s a good thing.  I’m not sure I could have ever done the same job for 15 years, and even though my title and company haven’t changed since 1999, the substance of my job has changed every few years.  I have loved every minute of every day of this journey (even the not-so-good ones) and am privileged to work with such an amazingly talented executive team, staff, and board.  I won’t say “here’s to the next 15,” because I can’t count that high, but here’s to Return Path!

And to celebrate #15, my colleague Tom Sather assembled this fun infographic that has some fun stats and is a bit of walk through history.

If you’ve been reading this blog for a long time (amazingly, it is over 16 years old now!), you know that my company and main professional life’s work up to this point, Return Path, was a 1999 vintage email technology company that we sold last year.  I then had a couple other interim leadership roles, first as interim CEO of another tech company in New York, then in March as the founder and interim leader of Colorado’s COVID-19 Innovation Response Team, which I wrote a series of blog posts about (this is the final post in the series, which links to the whole series).

I’ve generally been quiet on OnlyOnce since last year, but I will be picking up the pace of writing in the weeks ahead for a couple of reasons.

First, I’ve teamed up with a few former Return Path colleagues and some amazing investors and partners to start a new company.  We’re still in quasi-stealth mode, so I’m sorry I can’t talk about it much yet, but I will as soon as we publicly launch sometime after Labor Day.  It’s a cool business in a totally different space from Return Path and plays to our team’s interests and skills around people, values, culture, leadership development, and team scalability. I won’t rename this blog OnlyTwice, but there’s definitely a lot to be said for being a second-time founder.

Related to that, I have also been working on a Second Edition to my book from 2013, Startup CEO: A Field Guide to Scaling Up Your Business, which is coming out in a week or two from Wiley & Sons, and which is available for pre-order now.  I will write a series of posts in the coming weeks that talk about the new material in the second edition.  Our team at the new company is also working on a sequel to that book – more to come on that as well.

For now, I am doing great, enjoying life as a brand new Startup CEO once again, and feeling quite privileged and a little guilty for it by being in this weird bubble of my nice home and yard and feeling safely isolated from the pandemic, from economic dislocation, from social protests, and from having to lead a scaled organization through all of that turmoil.

Fig Wasp #879

I have 7 categories of books in my somewhat regular reading rotation:  Business (the only one I usually blog about), American History with a focus on the founding period, Humor, Fiction with a focus on trash, Classics I’ve Missed, Architecture and Urban Planning (my major), and Evolutionary Biology.  I’m sure that statement says a lot about me, though I am happy to not figure it out until later in life.  Anyway, I just finished another fascinating Richard Dawkins book about evolution, and while I usually don’t blog about non-business books, this one had an incredibly rich metaphor with several business lessons stemming from it, plus, evolution is running rampant in our household this week, so I figured, what the heck?

The Dawkins books I’ve read are The Selfish Gene (the shortest, most succinct, and best one to start with), The Blind Watchmaker (more detail than the first), Climbing Mount Improbable (more detail than the second, including a fascinating explanation of how the eye evolved “in an evolutionary instant”), The Ancestor’s Tale (very different style – and a great journey back in time to see each fork in the evolutionary road on the journey from bacteria to humanity), and The God Delusion (a very different book expounding on Dawkins’ theory of atheism).  All are great and fairly easy to read, given the topic.  I’d start with either The Selfish Gene or maybe The Ancestor’s Tale if you’re interested in taking him for a spin.

So on to the tale of Fig Wasp #879, from this week’s read, Climbing Mount Improbable.  Here’s the thing.  There are over 900 kinds of fig trees in the world.  Who knew?  I was dimly aware there was such a thing as a fig tree, although quite frankly I’m most familiar with the fig in its Newton format.  Some species reproduce wildly inefficiently — like wild grasses, whose pollen get spread through the air, and with a lot of luck, 1 in 1 billion (with a “b”) land in the right place at the right time to propagate.  At the opposite end of the spectrum stands the fig tree.  Not only do fig trees reproduce by relying on the collaboration of fig wasps to transport their pollen from one to the next, but it turns out that not only are there over 900 different kinds of fig trees on earth, there are over 900 different kinds of fig wasps — one per tree species.  The two have evolved together over thousands of millenia, and while we humans might take the callous and uninformed view that a fig tree is a fig tree, clearly the fig wasps have figured out how to swiftly and instinctively differentiate one speices from another.

So what the heck does this have to do with business?  Three quick lessons come mind.  I’m sure there are scores more.

1. Collboration only works when each party benefits selfishly from it.  Fig wasps don’t cross-pollenate fig trees bcause the fig trees ask nicely or will fire them if they don’t.  They do their job because their job is independently fulfilling.  If they don’t — they probably die of starvation.  They’re just programmed with a very specific type of fig pollen as their primary input and output.  We should all think about collaboration this way at work.  I wrote a series of posts a couple years back on the topic of Collboration Being Hard, and while all the points I make in those posts are valid, I think this one trumps all.  Quite frankly, it calls on the core principle from the Harvard Project on Negotiation, which is that collaboration requires a rethinking of the pie, so that you can expand the pie.  That’s what the fig trees and fig wasps have done, unwittingly.  Each one gets what it needs far more so than if it had ever consulted directly with the other.  The lesson:  Be selfish, but do it in a way that benefits your company.

2. Incredibly similar companies can have incredibly distinct cultures.  900+ types of fig tree, each one attracting one and only one type of fig wasp.  Could there be anything less obvious to the untrained human eye?  I assume that not only would most of us not be able to discern one tree or wasp type from another, but that we wouldn’t be able to disdcern discern any of the 900+ types of trees or wasps from thousands or hundreds of thousands or millions (in the case or urbanites) types of trees or bugs in general!  But here’s the thing.  I know hundreds of internet companies.  Heck, I know dozens of email companies.  And I can tell you within 5 minutes of walking around the place or meeting an executive which ones I’d be able to work for, and which ones I wouldn’t.  And the older/bigger the company, the more distinct and deeply rooted its culture becomes.  The lessons:  don’t go to work for a company where you’d even remotely uncomfortable in the interview environment; cultivate your company’s culture with same level of care and attention to detail that you would your family — regardless of your role or level in the company!

3. Leadership is irrelevant when the operating system is tight.  You think fig wasps have a CEO?  Or a division president who reports into the CEO that oversees both fig wasps and fig trees, making sure they all cross-pollenate before the end of the quarter?  Bah.  While as a CEO, you may be the most important person in the organization sometimes, or in some ways, I can easily construct the argument that you’re the least important person in the shop as well.  If you do your job and create an organization where everyone knows the mission, the agenda, the goal, the values, the BHAG, whatever you want to call it — withoutit needing to be spelled out every day — you’ve done your job, because you’ve made a company where people rock ‘n’ roll all night and every day without you needing to be in the middle of what they’re doing. 

I’m sure there are other business lessons from evolutionary biology…send them along if you have good thoughts to share!

No Recession at Return Path

I know, I know.  I shouldn’t jinx us.  But we’re growing like mad at the moment, so much so that we have well almost 50 open positions now across all divisions of the company.  If you want to come join one of the fastest growing, most innovative, and just plain coolest places to work in the industry, we’d love to talk to you.

What’s driving the growth? 

• All our operating units have open positions.  Sender Score (deliverability/whitelisting) has the most openings and is growing explosively.  But Authentic Response (market research) and Postmaster (lead generation) both have openings as well
• Geographic expansion.  We have a bunch of openings in Europe as well as in the U.S.  Other parts of the world…stay tuned for later in the year (or let us know now that you are interested once we get to your corner of the globe)
• The power of email.  Parts of the economy may be a bit choppy now, but online marketing, and email in particular, are going strong.  Clients are finding the e-channels to be more and more effective and efficient ways of driving sales and customer loyalty

Visit the careers page at our web site to have a look — all the new jobs probably aren’t posted yet, but many are, and the rest are on the way shortly.  This is a fun and exciting and rewarding place to work.  Trust me.  I’m completely unbiased.  No, really.  Come join the team, or refer others!

How to Quit Your Job

I sent an email out to ALL at Return Path a few years ago with that as the subject line.  A couple people suggested it would make a good blog post in and of itself.  So here’s the full text of it:

ALL –

This may be one of the weirdest emails you’ll see me (or any CEO write)…but it’s an important message that I want to make sure everyone hears consistently.  If nothing else, the subject line will probably generate a high open rate.  🙂

First off, I hope no one here wants to leave Return Path.  I am realistic enough to know that’s not possible, but as you know, employee engagement, retention, and growth & development are incredibly important to us.

But alas, there will be times when for whatever reason, some of you may decide it’s time to move on.  I have always maintained that there’s more than a Right Way and a Wrong Way to leave a job.  For me, there’s a Return Path Way.

I suppose the Right Way is the standard out there in the world of two weeks’ notice and an orderly documentation and transition of responsibilities.  The Wrong Way is anything less.

So what’s the Return Path Way?

It starts with open dialog.  If you are contemplating looking around for something else, you should let someone know at the thinking stage.  Ideally that would be your manager, but if you’re not comfortable starting the conversation there, find someone else — your department head, someone in HR, me.  Let someone who is in a position to do something about it know that you’re considering other options and why.  The worst thing that will happen is that the company isn’t able to come up with a solution to whatever issues you have.  I PROMISE you that no one here in any management position will ever think less of you or treat you differently or serve up any kind of retribution for this kind of conversation.

After the open dialog and any next steps that come out of it, if you are still convinced that leaving is the right thing for you, tell your manager and whoever you spoke to at the beginning of your search process, not at the end of it.  That hopefully gives the company enough lead time to find a replacement and provide for enough overlap between you and the new hire so that you can train your replacement and hand things off.

Why do we feel so strongly about this?

We invest heavily in our people.  I know we’re not perfect — no company is — but we do our best to take good care with everyone who works here.  Hopefully you know that.  And hiring great people is difficult, as you also know.  Losing a well trained employee is VERY PAINFUL for the company.  It slows our momentum and causes at least a minor level of chaos in the system.  And as shareholders or future shareholders (even if you leave – you can exercise your vested stock options), I’d hope that’s something none of you want to do.

I realize the Return Path Way that I am outlining here is unconventional (and potentially uncomfortable).  But Return Path is an unconventional place to work in a lot of ways.

As I said up front, I hope none of you wants to leave…but if you do, please take this request and advice to heart.

Thank you!

-Matt

Now…I sent this out when the company was a lot smaller, when losing a single employee was losing a real percentage of our workforce!  But I stand by every word in the email, even at a larger size.  This kind of dialog is, as I note in the email, both unconventional and uncomfortable.  But just as one of my management mantras here is “no one should ever be surprised to be fired,” another is “we should never be surprised when someone resigns.”  Ultimately, it’s up to each individual manager to set the right tone with his or her team, and also be in tune enough with each of his or her team members, to foster this.

(The following post was written by one of Return Path’s long-time senior managers, Chris Borgia, who runs one of our data science teams and has run other support organizations in the past, both at Return Path and at AOL.  I don’t usually run guest posts, but I loved the topic with Chris suggested it, and it’s a topic that I’d only have a limited perspective on!)

Managing Up in a Growing, Global Workplace

For many years, I thought “managing up” was a cheap way of getting ahead. I thought someone who managed up was skilled at deceiving their boss into thinking they were more accomplished than they really were.

I have since learned that managing up, or managing your boss, is not devious, but is actually a valuable discipline. When you learn to manage up successfully, you empower your boss to better represent your interests to influencers in the organization.

If you are a manager, you should realize that in addition to managing your boss, you can help your employees effectively manage you. When our employees help us to be successful, we are further enabled to invest in their success. This symbiosis is seen in any relationship – the more you help the other person, the more they will be able to – and want to – help you. If you are a manager, it’s important to realize that your employees should be managing up, and you can encourage them to do so by being vulnerable, admitting ignorance, and asking for support.

There are many books and articles on managing up or managing one’s boss. The essentials are fairly consistent:

• Understand your boss’s goals, priorities, and needs
• Know your boss’s strengths and weaknesses
• Set mutual expectations to build trust
• Communicate and keep your boss informed

You’ll need to be intentional about the essentials no matter where you work, but there are additional challenges of managing up in a growing, global workplace like Return Path. In a growing company, you’re likely to work for a boss who is new to their role, the company or the industry. In a global company, you may report to a boss who works in another office, or even in another country. The fundamental aspects of managing up are the same, but these situations can require a tailored approach.

When your boss is new to their role, the company, or the industry

In a growing company, you’re likely to report to someone who is new to their role in the company, new to the company itself, or even new to the industry. You can be invaluable to your boss in closing the knowledge gap and enabling them to make the best decisions for you and your team.

• Process Help your boss understand how the department operates. How are goals and priorities determined? How do people communicate? What does the team expect from the boss?
• People If your boss doesn’t know the people, they may lack the appropriate empathy in a given situation. Help them understand your team’s needs and how their decisions impact the people.
• Decision Making Your boss will likely need additional data to help them make decisions. Providing your boss with this data up front, saving them from admitting ignorance, will go a long way to developing a strong relationship.
• Context Sometimes your boss won’t know what they don’t know, so providing your boss the context around issues, decisions, and goals will enable them to make the best decisions for your team.

When your boss works in another office or country

In a global workplace, it’s likely that at some point you will have a boss who works in another office or even in another country. Having a remote boss offers many opportunities for managing up.

• Visibility Your boss doesn’t see you – or possibly others on the team – every day, so you might want to communicate more about the day-to-day operations of the team. At times, it will feel like you are sharing minutia, but it’s likely your boss will find this valuable in developing a complete understanding of what is going on.
• Insight If you work in a core office, you have a tremendous opportunity to be your boss’s eyes and ears.  What are you seeing or hearing locally that might change your boss’s plans or perspective? What are people worried about? Are there any rumors your boss should be aware of?
• Culture If your boss is in a different country, you will need to develop a relationship that considers any cultural differences. Cultural differences are seen in office attire, working hours, email habits, vacation schedules, and more. Bosses in some cultures may expect more deference, while in others they may expect more direct honesty. Understanding your boss’s culture, and helping her understand yours, will develop mutual respect and expectations to make each other successful.

Your relationship with your boss is a symbiotic one. Your boss can’t be successful unless you are, so they are your champion.  Learning to effectively manage up, especially in a growing, global workplace, is not nefarious business. Your boss will represent and support you to the best of their abilities. The more you enable your boss, the better they can support you, and everybody wins.

A New Season for Bonded Sender (now Sender Score Certified)

(With apologies to my non-email industry readers for such a long detailed posting)

Ah, spring.  New life is everywhere.  Winter clothes are being put away, birds are returning from their winters in the south, flowers are blooming.  We at Return Path are doing our part by announcing the “rebirth” of our Bonded Sender Program, the Internet’s largest and oldest email accreditation program, or whitelist, as Sender Score Certified.

Since we acquired Bonded Sender last fall, we’ve had the opportunity to go on a “listening tour” – talking to marketers, publishers, ESPs, ISPs, spam filtering companies, system administrators, email appliance manufacturers – you name it.  What we learned was that the program was ground-breaking when it was launched in 2002 but that it needed a makeover in order to meet the challenges that have evolved around spam and deliverability for both senders and receivers during the past few years.

Our listening tour revealed that the Bonded Sender of old had four core issues that weren’t sitting well with the Internet community at large:

1.  Data validity:  some senders questioned the accuracy of some of the application and compliance metrics used;

2.  Black box:  a complete lack of transparency led many senders to be unclear as to what was driving them to fail applications or have bonds debited;

3.  Bond:  there isn’t a purchasing department in America that knows how to post a bond or understands why they should; and

4.  Complaints:  as far as ISPs were concerned, even though mailers had to pass some serious hurdles to join the program, mailers who were in the program still managed to generate too many complaints among their end users.

A spring cleaning was in order, and we had the experts to get the job done.   The deliverability gurus inside Return Path — George Bilbrey, Tom Bartel, Robert Barclay, Leslie Price, Dan Deneweth, and others — working with a myriad of external advisors, delivered the makeover the program needed.

So today, Bonded Sender is reborn as Sender Score Certified.  We have worked hard to address all four main beefs about the program, while keeping the elements of the program that have worked well.  So here’s what you can expect of the new program.  First, what’s new and different:

1.  New and Improved Data:  the program is now powered by our newly launched Sender Score Reputation database, which George wrote about last week – a robust source of reputation information sent to us daily by scores of different sources on the Internet, including B2B and B2C, domestic and international, ISP and commercial filters;

2.  Complete transparency:  the Sender Score Reputation Monitor service allows clients to have 100% visibility into every metric tracked for the program, including some super-cool drill-down features;

3.  Bye-Bye, Bond:  these high standards make the bond unnecessary (and they really made us need to find a new name – can you imagine Bondless Sender?).   You’re either on the list, or you’re not.  The transparency makes it much easier for us to work with our clients on compliance; and

4.  Radically Reduced Complaints:  the new standards have allowed us to raise the bar on the quality of the program.  We’ve built the statistical model underlying the program to have a VERY high correlation with some leading spam filters, enabling us to remove a huge number of senders who were previously on the whitelist.  The result?  Our largest ISP user, Microsoft, reports to us a nearly 90% drop in the number of complaints in their network coming from users of the program – and that was off a very small number of complaints to begin with, relative to the rest of the email universe.

OK, you say – sounds great.  But what did we actually keep about the program?

1.  We still partner with third-party watchdog non-profit TRUSTe to perform a critical, detailed practices accreditation of incoming clients as well as help us with compliance;

2.  We still use SpamCop complaint data as one data feed for the program’s compliance – but now it’s just one of several; and

3.  We still have more than 35,000 domains, including Hotmail, MSN, Outblaze and Roadrunner, as well as users of Spam Assassin and Ironport appliances, using the program to help determine what email to let through.

So spring has sprung at Return Path for our delivery assurance business.  The Bonded Sender makeover is done, and the new Sender Score Certified is here to innovate the next generation of email accreditation and whitelists for the industry.

For more on Sender Score Certified, read our press release or the program requirements today.

Dumb Money

I don’t have a counter cliche to Fred’s two-for-one this week on Passing the Hat and Ponying Up, but I’ll counter with a different, somewhat related Fred cliche that I was reminded of today when reading Paul Graham’s essay entitled A Unified Theory of VC Suckage (form your own opinions of it, but it’s nothing if not thorough and experience-based).

There’s nothing worse than dumb money backing a dumb idea or management team.

The dumb idea or team can destroy an emerging sector pretty quickly, and the dumb VC behind the deal will just keep ponying up.  For the record, the converse is also true — there’s nothing better than smart money behind a great idea and solid team.

The classic dot com version of dumb money is the company who decides to give away its core service for free (the one where they compete with other players) in order to try to make money at something else.  It could take 2 years and a ton of VC money before that company is out of business, having figured out that they needed to charge for their core business — and that process can wash out other companies in the process who are being smarter and more conservative about things.

So instead of just cheering that your competitor is dumb, dig in and look at how smart the money is behind the company.  If the money is dumb, too, beware!

This post was inspired by Startup CXO and was originally published by Techstars on The Line.

If you’re new to the Chief Customer Officer role, we’d like to share some advice we wish we had learned earlier in our careers. There are a few common misconceptions about customers and the service organization. If you don’t realize these as misperceptions, you can spend a lot of time dealing with issues that are not real, but perceived. We have identified five of these common misperceptions, although we are sure there are more.

Misperception #1: The service organization fully controls churn (customer attrition)

In a lot of organizations you’ll see the service organization be measured solely on customer churn. If you really think about it, there are many elements that come into play that impact churn, including

• How the customer is sold
• The quality of the product
• How easy it is to onboard the customer
• How easy it is to use the product
• How easy it is for the customer to understand what kind of value they’re getting out of the product

Of course, the service functions do have a critical role, but they’re not the only functions in a company that impact churn. The responsibility for churn also lies with sales, engineering, marketing, and other teams. One reason why you need a C-level senior person in charge of all service operations is because you need someone who understands the customer experience broadly and that person has to work cross-functionally to ensure customer retention.

Misperception #2: The service organization is just a cost center

In many businesses, if a function isn’t generating new revenue, it’s seen as “second class.” From our perspective revenue retained is revenue gained and the service organization has a big impact on retaining revenue. In addition, the account management portion of a service organization is often in charge of up-sale and cross-sale opportunities which can be huge areas of growth. CCOs should work within their company to alter that misperception of service as a cost center because the service organization can have a huge impact on revenues.

Misperception #3: Service teams should focus on responding to defections

I’ve recently found a situation where the customer success team is built to focus on the clients who have raised their hand and said, “I want to leave.” This reactive approach drives low job satisfaction and isn’t the “best and highest use” of a service team’s time. By the time a customer is frustrated enough, or isn’t seeing the value enough, that they want to leave — you’ve missed a window of opportunity. The right focus should be proactively helping customers reach their desired business objectives. If you can do that, most customers will stay. That’s the theory behind the rise of the customer success team and that’s what great companies are doing today.

Misperception #4: Service’s job is to “paper over” gaps in the product

There is a widespread practice of covering for product issues by throwing service at the problem. That certainly can work, but it’s not optimal. The superior approach is to focus the service team on becoming a trusted advisor for customers, helping those customers achieve their desired outcomes. To do that, the CCO will have to work cross-functionally with the product team, the marketing team, and the sales team to drive a more friction-free customer experience.

Misperception #5: Service is boring and tactical

There is a wide-spread misperception that working in the service organization is boring. It’s mundane, it’s tactical, it doesn’t appeal to people who think strategy is grander than tactics. I don’t agree with that at all. A great service organization starts with a strategy. It starts with an understanding of customer segmentation. It includes thinking about the different customer personas and how to define an appropriate and valuable customer experience. That core strategy actually takes a while to develop. Once the strategy takes hold, it is core to driving retention over time. And, while a lot of people perceive that the service organization jobs are boring, or just answering trouble tickets or reacting to client problems, that’s not the whole role. It is a strategic role as well. 

The Chief Customer Officer has a big impact on the success of a company, especially startups and scaleups, and their function touches nearly every aspect of a company. To give your company the best chance of scaling, the Chief Customer Officer should understand, pinpoint, and manage misperceptions so that they can devote their time, energy, and resources to the real problems that help customers.

Big Apple, Little Company

Ed Daciuk, on of my blog subscribers, questions:  What is your view on the benefits of being in NYC as a startup?

Fred wrote a good posting several months ago and a related one this week on early stage investing in the NYC market from the perspective of a venture capitalist.  His main points:  (1) NYC is a great place to invest in early stage tech-related businesses as long as they’re not "core technology" businesses like semiconductor or hardware, because (2) core technology companies are more exciting to investors, and therefore the investors have clustered around those companies in places like Silicon Valley or Boston.  He also thinks this dynamic is changing as more and more successful companies are started as technology-enabled service businesses as opposed to pure tech companies.

As someone who’s been in tech-enabled services businesses in NYC for 10 years now, I couldn’t agree more with this last point.  But I thought I’d address Ed’s question from the entrepreneur’s perspective as well.

First, why is New York a great place for a startup?

1. Access to customers.  There is far greater concentration of major corporations and agencies headquartered in and around the NYC area, making it much easier to see and talk to prospects and customers in this market.

2. Lots of talent.  There are lots of people, meaning there are lots of people to hire.  Some disciplines are easier than others to find talent, but the labor pool is just huge.

3. Convenience.  This is always one of NYC’s main selling points, and it applies here as well.  It’s mainly a collection of little things like being able to see a customer or investor in minutes by foot or mass transit and late night food delivery, but all those extra minutes you save here and there add up!

4. Idea generation.  The density and complexity of the city’s business landscape make it a natural for stimulating great ideas, especially in the service and media sectors.

5. Work ethic.  New Yorkers are accustomed to working startup hours in many professions — banking, consulting, law, etc., so it’s much more natural to have a team pounding away at the office early and late than it is in other geographies.

But it’s not all that easy.  New York can also be a difficult place for a startup because:

1. It’s expensive.  Very expensive.  People cost more, benefits cost more, T&E costs more, rent costs more.

2. Space is limited.  There’s no such thing as starting out in someone’s garage, because there are no garages — only teeny tiny apartments.  And no one takes a lease with room to grow because that extra space comes at such a premium.

3. Good money is harder to find.  As Fred says, it’s getting better, but the environment still isn’t as rich with high quality VCs as places like Silicon Valley or Boston.

4. Even when you do find good money, valuations are tougher.  For whatever reason, I’ve always found that "west coast" valuations are more generous than "east coast" valuations.

On balance, I’d say it’s probably a wash — there are plusses and minuses of NYC as a place for startups.  But it’s definitely not, as conventional wisdom would have it, an inhospitable environment for startups.

As I mentioned earlier this summer, I’ve been working on a new startup the past few months with a group of long-time colleagues from Return Path.  Today, we are officially launching the new company, which is called Bolster.  The official press release is here.

Here’s the business concept.  Bolster is a talent marketplace, but not just any talent marketplace.  We are building a talent marketplace exclusively for what we call on-demand (or freelance) executives and board members.  We are being really picky about curating awesome senior talent.  And we are targeting the marketplace at the CEOs and HR leaders at venture- and PE-backed startups and scaleups.  We’re not a search firm.  We’re not trying to be Catalant or Upwork.  We’re not a job board. 

To keep both sides of the marketplace engaged with us, we are also building out suites of services for both sides – Members and Clients.  For Members, our services will help them manage their careers as independent consultants.  For Clients, our services will help them assess, benchmark and diversify their leadership teams and boards. 

We have a somewhat interesting founding story, which you can read on our website here.  But the key points are this.  I have 7 co-founders, with whom I have worked for a collective 88 years — Andrea Ponchione, Jack Sinclair, Shawn Nussbaum, Cathy Hawley, Ken Takahashi, Jen Goldman, and Nick Badgett.  We have three engineers with whom we’ve worked for several years who have been on board as contractors so far – Kayce Danna, Chris Paynes, and Chris Shealy.  We have four primary investors, who I’ve also known and worked closely with for a collective 77 years — High Alpha and Scott Dorsey (another veteran of the email marketing business), Silicon Valley Bank and Melody Dippold, Union Square Ventures and Fred Wilson, and Costanoa Ventures and Greg Sands.  Pretty much a Dream Team if there ever was one.

So how did our team and I get from Email Deliverability to Executive Talent Marketplace?  

It’s more straightforward than you’d think.  If you know me or Return Path, you know that our company was obsessed with culture, values, people, and leadership development.  You know that we created a cool workforce development nonprofit, Path Forward, to help moms who have taken a career break to care raise kids get back to work.  You know that I wrote a book for startup CEOs and have spent tons of time over the years mentoring and coaching CEOs.  Our team has a passion for helping develop the startup ecosystem, we have a passion for helping people improve and grow their careers and have a positive impact on others, and we have a passion for helping companies have a broad and diverse talent pipeline, especially at the leadership level.  Put all those things together and voila – you get Bolster!

There will be much more to come about Bolster and related topics in the weeks and months to come.  I’ll cross-post anything I write for the Bolster blog here on OnlyOnce, and maybe occasionally a post from someone else.  We have a few opening posts for Bolster that are probably running there today that I’ll post here over the next couple weeks.

If you’re interested in joining Bolster as an executive member or as a client, please go to www.bolster.com and sign up – the site is officially live as of today (although many aspects of the business are still in development, in beta, or manual).