ANS (accepted not started) and BIS (butts in seats). Yes, these are actual standard company recruiting terms.
gubernatorial campaign
“I’m not going to tell you which processes you should put in place. But I will tell you that you need them, and you need them sooner than you realize.” When the person asked why, I said, “You know why playing a game is fun? Because it has rules, and you have a way to win. Picture a bunch of people showing up at an athletic eld with random equipment and no rules. Someone is going to get hurt. You don’t know how to play, you don’t know how to score, and you don’t know how to win.”
“What I think you’ve taught me most is how important it is to state the obvious.” Yes, it felt like a backhanded compliment. But what I think she meant is that I strive to make implicit structures and beliefs explicit.
We had promoted a lot of people into management internally, which is an eective way to reward high performers and build company scaolding, but we hadn’t invested enough in giving people the resources and the support they needed to be the most eective managers they could be.
a great manager can change someone’s trajectory. They can push employees to make career choices that leave them much more fullled. The role is both operational and managerial. To have a job that focuses on just one of these elements—delivering business results or producing personal impact—is already a big task. But to work in a job that does both?
The hardest parts of company building and management are done in private: designing your planning process, deciding who gets promoted, planning a reorganization, reducing the scope of a person’s role.
You can’t sit in on another manager’s 1:1s. You don’t get to observe how your colleague handled that termination conversation. You’re not privy to how your peers give their reports dicult feedback. You’re asked to y a very complicated aircraft, but you never get time in the practice simulator.
I believe that most people don’t neatly compartmentalize their home and work lives.
Nearly all of this material was created within Stripe.
introvert or extrovert? my favorite litmus tests is: Do you talk to think or think to talk?
DiSC (which stands for dominance, inuence, steadiness, and conscientiousness), 10 as well as the well-known Myers-Brigs Type Indicator (MBTI), 11 which helps identify 16 dierent personality types and is based on the work of Carl Jung. My personal favorite is Insights Discovery 12 because it’s more nuanced than the MBTI yet easier to understand
When I think about whether a capability is innate or not, I ask myself: Is doing this thing well as easy as breathing?
strengths can also be weaknesses
Teams become mirrors of their managers.
I’m still doing this. I put it in my calendar and call it ‘15minute thinking and meditation.’ I ask myself: If I start over today, what can I do dierently? Did I make any mistakes? Can I improve tomorrow? Sometimes I write down something important. But most of the time, the thinking is enough.” —Eric Yuan, founder and CEO, Zoom
Why don’t managers say what’s actually on their minds? be wary of over-filtering.
Fred Kofman explains why it’s so hard for us to say what we’re thinking. It’s because every conversation has three components:
• The “it”: the task being discussed
• The “we”: the relationship between the people having the discussion
• The “I”: your personal stance in the conversation
Everyone understands what it feels like to be worried or overloaded. If you say, “We didn’t hit our targets,” you haven’t oered any comment on the gravity of the situation. On the other hand, if you say, “We didn’t hit our targets, and I’m worried about the impact that this will have on our team and on the business,” the team will immediately understand that there’s a problem that needs fixing.
It’s more eective to explain why you feel that way. So rather than “The team is performing terribly,” you might say, “My impression is that the team isn’t communicating well right now, and I think deadlines are being missed as a result. Do you agree, or could it be something else?”
“Leadership is strategic, and management is more [about] implementation. Leadership is about setting direction, knowing where you want to go, convincing others to go with you, and explaining why you’re going there: setting standards, setting expectations, setting tone. Management is about implementing that: getting the processes right, getting the people right, getting the teams right.”
Great managers don’t initially have to be great leaders, but the more senior a manager becomes, the more important it is that they also develop leadership skills. Eventually, managers need to be able to set a vision and direction for their team—and potentially make the team uncomfortable with a bit of heat—or they’ll hit a ceiling in their careers.
When I take another of my favorite self-awareness assessment tests, the Big Five Personality Test, 17 I score as a classic great manager, high on conscientiousness and agreeableness. But great leadership often requires a person to be disagreeable and demand more.
for every team I manage. They each have the same components: clear missions, stated goals, metrics that matter, similar meeting structures, and weekly and quarterly cadences.
business frameworks, like Porter’s ve forces and the four Ps of marketing
Stripe’s mission became to increase the GDP of the internet.
Bill Gates once said, “Early on, Paul Allen and I set the goal of a computer on every desk and in every home.
Google’s mission: “Organize the world’s information and make it universally accessible and useful.”
“The bigest mistake I made [early on] is we did not focus on writing [down] the company’s business principles. To delegate to other leaders, we need to write down our principles on hiring, on ring, on performance, on security, on many things.” —Eric Yuan, founder and CEO, Zoom
Stripe, early drafts of the principles were written by employees. Patrick reviewed the early work, then drafted his own version.
trajectory-altering impact
“Every day, you all choose where to put your time. My goal is to give you the information to make the best decision.”
for example, 10 engineers to 1 product manager, or 1 human resource business partner to 250 employees.
With an eye toward cash burn rate, founders want to be careful about adding more people. And when they do, they want to hold those people accountable for an output commensurate with the additional people power.
Google would devote 70 percent of its resources to the core business, 20 percent to emerging products, and 10 percent to research and development for future products.
John Tukey said, “Far better an approximate answer to the right question, which is often vague, than an exact answer to the wrong question
Pyrrhic victory: a victory won at such a great cost that it was not worth the battle.
“what’s on the truck” revenue
Good communication is about providing timely and honest information, including being willing to acknowledge mistakes. People forgive mistakes, but they lose trust when information is hidden, false, or misleading, or when leadership says something but doesn’t follow through.
Dunbar’s number. At around 150 people, it becomes harder to remember everyone’s name, what team they’re on, and what they’re responsible for. by the time your company hits 150 people, you should have an internal company website, clear communication guidelines, and policies for what information gets stored, through what channels it’s communicated, and what information teams are responsible for maintaining. You should also formalize a means to deprecate out-of-date content. company wiki. Plan to communicate important information at least three times using dierent mediums or channels.
Examples of operating cadences include:
• Annual planning processes
• Quarterly business reviews
• Monthly all-hands meetings
• Biweekly 1:1s
• Weekly snippets and team meetings (with metrics reviews)
• Daily standups
I’m a big fan of experimenting with systems and processes. If you do experiment with your processes, make sure to:
• State how long you’re going to try the process for. • Determine when you’ll check back in to see how things are going.
• Set your evaluation criteria for whether to continue or revisit the process.
We aren’t wedded to how we currently do things
We will also deliver “table-stakes” security features
Is the metric relative, not absolute? (For example, instead of “Increase the number of users by 1,000,” explain the relative growth: “Increase the number of users by 20 percent, from 5,000 to 6,000.”)
Leadership understands what you need to accelerate and produce outstanding results.
In the early days, Stripe got creative about building its hiring pipeline. Because we built for developers, we were able to hire a few early users of the product, namely the ones who gave the most and best feedback. But soon enough, we added new tactics to our eorts to educate and dierentiate. These ranged from the founders posting on Quora or Hacker News and answering questions on Internet Relay Chat to writing blog posts on the Stripe site and using Twitter to share them.
One way the early team drove trac to Stripe and to our job postings was a competition called Capture the Flag: a series of coding challenges that created a buzz and, best of all, presented the company with participants who might be great job candidates.
once you’re past your initial team—say, 10–20 people—you should think about building a recruiting team with an experienced leader. Still, a recruiter should never be a substitute for a hiring manager, meaning the individual hiring for the role. There needs to be a tight partnership between the person responsible for the recruiting experience and the recruiting process and the person who will ultimately be accountable for the new hire’s work.
It’s natural, as a company gets larger and larger, to keep specializing and sub-specializing until recruiting becomes a silo, letting individuals on a team focus on their jobs and not on interviewing. But I would caution against this tendency, because eventually people become divorced from learning how to represent the company— the culture!—and from feeling responsibilities for their colleagues’ selection and success. hiring is not a side job but a core responsibility for everyone in the company.
Growth from 100 to 400 people happens quickly if you have real traction. I sometimes call hyperscaling “riding the dragon”: You need your dragon riders—your fearless leaders—before the beast takes o to still greater heights.
If your company is scaling, it helps to remember that your primary goal is to work yourself out of a job. I used to have a test at Google: When my team and I got an email from a leader with a question, I would refrain from writing back immediately and wait for someone else on my team to respond. I viewed it as a failure if I was the only one who could answer the question or take action.
“You have to give away your job every six months.” That’s especially true for leaders, particularly founders and CEOs.
One of my favorite stories from Google’s early days is about how the founders hired Omid Kordestani. Omid was Google’s 11th employee, and he built its business operations from the first employees and the rst dollar in revenue to over 12,000 employees and over $20 billion in revenue.
what’s the dierence between accounting and strategic nance?
Whether you promote from within or hire externally, you’ll want to be clear on three things:
• What is the work to be done?
• What does “great” look like?
• How will we assess people against that benchmark?
Stripe charged for its product from the beginning and monitored the P & L closely to avoid costs far outstripping revenue growth. The founders began taking a series of meetings with potential heads of sales, as well as some COO types.
One excellent concept I inherited when I joined Stripe was the idea of a business operations team: a team staed with folks who have a mix of consulting and entrepreneurial backgrounds, who thrive on new situations and on solving problems as Stripe scales. The members of the initial “biz ops” team, as we call it, were our first salespeople, and many of them were also our first product managers. Really, they were whatever Stripe needed them to be at the time—which is a lot like the COO job. Before you hire a COO, consider building a biz ops team and hiring a head of business operations who can proxy some of the COO’s responsibilities. Doing so can help you scale and figure out what you really need in a potential COO. Your business operations leader may even become your COO—I did join Stripe as chief of business operations, after all!
As the manager of a potential new leader, there’s one more element to consider for your rubric: complementarity with your existing leadership team. Some companies have all leadership candidates complete work style or personality assessments. Although we haven’t gone that far, Stripe did have our rst CFO candidate take the Insights Discovery assessment I described in Chapter 1, which presents ndings in a color wheel made up of blue, red, yellow, and green segments. I had an inkling that this hire would round out our team’s color wheel, adding someone in the blue quadrant, which tends to represent more introverted, analytical, and task-oriented people.
The more senior the role, the longer and more expensive the recruiting process: Expect to be searching for at least six months for senior leaders. After all that work, only about 25–50 percent of outside hires, especially senior ones, are successful. Whenever possible, start with the talent you know, develop them, and promote from within.
as your company gains traction, it will inevitably need to build a recruiting function. Most likely, your recruiters will be focused on the higher-volume hiring rather than on acquiring new leaders. The recruiters themselves are likely to be early in their careers and less experienced with leadership hiring. For senior roles, most earlier-stage companies rely on search firms. I’ve had mixed results with that path.
What he said, wistfully, stuck with me: “Don’t assume the folks who got you here will get you there.” Be constantly vigilant in answering this question: Do I have the talent I need now and for the next two to four years for my team or company to be a success?
Seek to have candidates only meet a maximum of eight people in the process. Studies at Google have demonstrated diminishing returns for additional interviews. If the role is more entry-level and very well understood, this could be reduced to four or ve people.
There are reasonably good training materials on interviewing and interviewing frameworks out in the market, such as the STAR (situation, task, action, result) method.
“It was my idea, but the credit goes to the whole team.” The less positive version of the answer is something like “I just did what everyone else decided.”
Although I find that at least one résumé-based question is a good way to break the ice and gauge the candidate’s experience, you’re better of getting them thinking about situational (“How would you handle this scenario?”) to behavioral (“Tell me about a challenge you overcame”) to strict competency (“Describe the last Excel model you built and how you approached the design”).
Once your company is big enough that leadership can no longer meet every candidate, I recommend establishing a program similar to Amazon’s Bar Raiser program. Bar Raisers are an exclusive group of interviewers who are considered good stewards of Amazon’s standards and culture.
Many companies have adopted something akin to the Bar Raiser program. At Stripe, for example, we had an “Elevate” interviewer who joined interview panels for other teams. Elevate interviewers were high performers and some of our best interviewers—they tended to conduct more interviews and had honed their skills.
We looked at historical feedback in our applicant tracking system, or ATS, which includes “denitely,” “yes,” “no,” and “not sure” responses on candidates. If we did hire the candidate, we looked at whether the interviewer’s assessments of “denitely” or “yes” compared favorably with how those candidates ultimately performed as Stripes.
I am increasingly of the belief that jobs should have set salaries, and that all compensation motivators should exist solely as bonus and equity vehicles.
“Would you say this person is in the top 50 percent of folks you’ve worked with?” If they say yes, ask, “Top 20 percent? Ten percent? Five percent?”
• Where do you see this person in three years?
• When was the last time you didn’t see eye to eye?
• What are some ways you’ve seen them be helpful to others?
• Tell me about a time when you coached them on something.
• How would you rate the candidate on a scale of 1–10? You can’t say 7!
• What’s a skill you’ve seen them grow?
• What advice do you have for me as a manager to help them be successful in this role?
An offer letter is a critical document, and any stock plan associated with an oer is a legal agreement. Sending an offer with the wrong salary or equity amount can be trust-destroying—or worse.
your best bet is to keep up the momentum and answer them promptly. As a sales leader once told me, “Time kills all deals.”
Introducing new leaders to an organization is like introducing a foreign substance into the body—it’s no wonder that companies anxiously try to avoid “organ rejection” of new leaders.
do the work to communicate the change—the promotion!— thoughtfully by telling those aected by the change rst and then making a wider announcement.
it’s best practice to run an internal selection process if you have even the slightest sense that there might be more than one potential candidate. The folks who participated in the search but were not selected may be disappointed, but they’ll also appreciate the chance to be considered.
make sure you message the internal hire thoughtfully. Explain what you were looking for, the process you ran, and why the person you selected emerged as the right choice.
Companies should seek to design the new-hire onboarding process in a way that feels true to the business.
• This should include: The “why” of the company, including the mission and the story behind it
• The “what” of the business, including current priorities and goals
• The “how” of company behaviors, including how people work together and the operating principles
I strongly believe that company leadership should take part in onboarding new hires, perhaps in a monthly session where leaders talk about company values and operating principles and, better still, share stories of those principles in action.
the entire curriculum should be thoughtfully designed to represent the fastest possible ramp to success for new hires.
essentially, translating the company operating system to the team level so that the new hire immediately understands how their work ladders up to the overarching plan.
You may have agreed or disagreed with the decision to hire the new leader. No matter the circumstances, it is crucial that you commit to their success. Everyone loses when a new leader fails. By denition, they have signicant responsibility at your company, so their failure means a failure for your division.
Ask them or discover what their most eective learning style is. Everyone learns dierently. It might be reading documents, watching presentations, whiteboarding sessions, chatting 1:1, or asking lots of questions.
If your new leader is also your new manager, it can be tricy to deliver dicult feedback when you’re just starting to build trust. In this case, it can be appropriate to give the data points to your manager’s manager and let them handle delivering the feedback.
Operating Principle 2: Say the thing you think you cannot say.