How Dave Goldberg of SurveyMonkey Built a Billion-Dollar Business and Still Gets Home By 5:30 PM
SurveyMonkey is an atypical technology company. They’ve been profitable from almost day one. They’ve grown at an astonishing rate and even with well over 100 million in revenue, refuse to go public. SurveyMonkey has done all of this while creating a culture that enables the company’s CEO, Dave Goldberg, to leave the office by 5:30 p.m. In this First Round CEO Summit talk, Goldberg shares the unconventional ways he’s transformed SurveyMonkey from a 12-person startup into a SaaS powerhouse.
Experience Is Often Overvalued
Conventional corporate thinking tends to emphasize the number of years spent working in a particular position. A person with five years of product marketing experience at Company X should be interchangeable with another person with the same amount of experience at Company Y.
It rarely works out that way.
That’s part of the reason why so many companies flounder in recruiting. "Experience" is not necessarily experience working in a particular culture. A corporate athlete in one company might be incapable of repeating that performance at another. Their success may have been dependent on their relationships at their previous employer. Their former team may have carried them to success, rather than the other way around.
Recruiting talent is expensive. Recruiting the wrong talented person is even more expensive.
Accoding to Goldberg, “You need this mixture between the two. Some of the worst mistakes that I’ve made in hiring come from hiring someone who looks like they’ve had great experience, but they just didn’t fit with our culture. Their experience didn’t translate to the new business.”
In response to this, Goldberg has taken cues from the sports world, and perhaps an earlier era in corporate strategy: training his own talent, and strengthening SurveyMonkey’s corporate culture in the process. "There are the people who don’t have any experience but are just really smart, talented, and motivated. When you get those people right, they’re your ‘homegrown talent’, if you will. These people are your farm team. These people are, for the most part, the best people who will stay long term at your company. They’re the carriers of the culture. They grew up there. You took a chance on them. They’ve learned how to be in the business."
Corporate culture isn’t your company’s ping-pong table. It’s not the posters you tape onto the office walls. Real culture is the cumulative effect of productive relationships among employees.
The costs of training, and of taking risks on unproven workers, can be less than the costs of hiring more expensive senior employees who may not be capable of performing in a new culture. Experience accumulates by working with certain groups of people within a certain culture.
Corporate culture isn’t your company’s ping-pong table. It’s not your catered lunch. It’s not the posters you tape onto the office walls. A real culture is the cumulative effect of productive relationships among employees. Those relationships can take years to develop. And they don’t always work out.
The Toughest Employee to Fire
Firing someone who’s bad at their job is an easy decision. It delivers returns to the company immediately. It improves the morale of the remaining productive employees, who didn’t enjoy working with the laggard anyway. That’s not to say it’s not difficult emotionally, but it’s generally obvious.
It becomes tougher when it’s necessary to fire someone who’s performed well at their job, but isn’t able to grow with the company. For a startup to scale to a successful larger company, the people need to scale, too.
In some cases, such employees might not take seeing a senior employee hired above them well. They might dislike being passed up for a promotion, but lack the maturity to understand why. Goldberg has found dealing with such situations to be particularly challenging, as the problem tends to lie more with the employee’s mentality rather than the quality of their work. Bad attitudes inhibit the success of otherwise good workers.
In well-managed companies, Bad Attitude + Good Work = You’re Fired.
Meetings. Who Needs ‘Em?
Partly in reaction to his experience at Yahoo!, Goldberg only attends “two and a half” regular scheduled meetings every week. Goldberg said, “I’m probably more anti-meeting than most people in my job. It’s just in my nature.” Instead, he leaves a few hours open each day for informal discussions. Employees can interrupt him when they need to talk. His personal management style favors these sorts of unscheduled, unmanaged discussions rather than intensive one-on-one meetings. The company’s team structure can do most of the coordination work, without the need for micromanagement from the top.
Pushing Employees Without Breaking Them
SurveyMonkey operates on both multi-year product goals and quarterly financial goals. That’s remarkable, considering the often-parodied tendency of startups to pivot into different industries. Holding to aggressive goals requires convincing employees to buy into the strategy, and to develop realistic standards of high performance.
Goldberg said, “I have that level of trust with them that we’re doing the right thing against that kind of long term strategy. It’s probably me pushing my team more. I probe at where they’re sandbagging... I’m not looking for 100% success against our goals. I’m looking for 90% to 95%, because I think if we got 100%, then we didn’t shoot high enough.
If the goals aren’t ambitious enough, everyone becomes complacent. If they’re too extreme, employees lose faith in themselves and their leadership. Knowing Yourself As a CEO.
The ancient Greek aphorism “know thyself” remains good advice for CEOs. Every manager has weaknesses. Identify them, and hire people who can compensate for them. Goldberg noted, “I’m not a process person. I know process is important, but it’s not my thing. I don’t like it that much, but I know we need it. I hire people who are good at it. Things seem to work pretty well in that manner.”
It’s this humility that makes it possible for a company to scale successfully. An executive who’s too full of themselves to acknowledge a company’s need for balance in hiring isn’t going to be capable of scaling the company. Hiring people who are strong where you’re weak is cheaper and more practical than becoming stronger in the weak places.
The insights that come from this self-awareness inform the rest of the decisions that a CEO makes every day. The leader must demonstrate the values that he or she promotes.
Employees pay more attention to what the CEO does than what he or she says. The words need to be congruent with the actions. When they are, the company develops a strong culture.
Building a Culture of “Work-Life Balance” is More Than Just Saying It
What’s the matter with commanding the entire company to work 20 hours a day, fueled by microwave pizza, dubstep, and Red Bull? Isn’t that the only way to triumph over the competition in Silicon Valley?
No. In Goldberg's eyes, scaling a company requires steadily increasing productivity, quarter by quarter and year by year. The reality is, as a company grows in headcount, more senior leaders become necessary. And those senior employees, many of whom are among the most productive, come with family obligations.
“A family-friendly environment is part of our culture. That’s part of the people we attract. We don’t have kids staying up all night playing video games and sleeping in our conference rooms most of the time.”
Goldberg leaves work at 5:30 p.m. every day to spend time with his family. While he does get back online after he puts his children to bed after 8:00 p.m., he sets an example that makes it easier for the company to build and maintain its workforce. A CEO who spends time with his family every day demonstrates to other employees who have families that it’s okay to be home for dinner and live a life outside the office. All too often leadership teams say “work-life balance” is important and it’s okay to be home with your family for dinner — but they in fact do just the opposite. If you, as a CEO, want to shape the culture and build a workplace with a diverse team, you need to prove it with your actions.
This is in the long-term interest of the company. While the death-march pace may work well during the early days of a startup, it’s unsustainable once it grows. Senior employees tend to come with attachments and obligations.
However, this wasn’t always Goldberg’s approach. When he founded his first startup, LAUNCH Media, in 1994, he followed the typical workaholism commonly associated with startups:
“I worked seven days a week, probably 14 or 18-hour days, and never took a day off. That’s just what I had to do. It wasn’t particularly productive.”
Realizing he wanted to build a company for the long-term, Goldberg set out to build SurveyMonkey differently. Early in his tenure, he put culture into action by recruiting the current SVP of Product and Engineering, Selina Tobaccowala, when she was four months pregnant. Making SurveyMonkey a place where team members can actually have a family life made it possible for Goldberg to close the highly sought after recruit, even given the competitive hiring market.
Counter intuitively, promoting a balanced working environment can drive down the cost of recruiting and your operational costs in general. It opens up access to a larger pool of potential employees. It allows the company to select employees based more on their merit, with less of a need to discriminate against older people with families. It also guards against burnout. In addition, it makes it tougher for rival companies to poach your employees.