Steven Aldrich has sold companies to both Intuit and GoDaddy. He teaches us why B2B businesses are so important, and why there is so much opportunity in combining data sets for businesses.
→ Why B2B businesses are so important
→ Why there is so much opportunity in combining data sets for business
→ His insights about eBay and Etsy
→ How does he talk about Net Promoter Score
→ What is the absolute value providing for a customer
→ What was the promise or how cool is the culture is
→ What kind of the grand strategy behind GoDaddy
→ What is the world look like in the future for GoDaddy
→ And a whole lot more
Bronson: Welcome to another episode of Growth Hacker TV, Bronson Taylor. And today I have Steven Aldrich with us. Steven, thanks for coming on the program.
Steven: Yeah, thanks for having me. Delighted to be talking to you about growth and go daddy and all things out, right?
Bronson: Absolutely. It’s going to be a fun conversation. But let me give people a little intro to who you are. You are the senior vice president of applications at GoDaddy, and you joined the GoDaddy team after your company outright was acquired by them in 2012. Previously, before that, you also had a company acquired by into it. So I’m sure you have plenty of advice to share to our audience today.
Steven: Yeah, well, I’ll tell you my story.
Steven: You guys can decide if it’s good advice or not.
Bronson: Well, you know, if you’ve sold two companies, it has to be good advice. So let’s dig in here. It seems like, you know, based on that intro there, that you’ve spent an entire career really serving small businesses. You had the insurance company, you sold that. Intuit it into it. You’re focusing on small businesses, then you’re an outright focusing on small businesses, and now you’re a GoDaddy again focusing on small businesses. Does having a career focus like that allow you to build better, faster growing companies, or do you think it’s okay to kind of be all over the map and jump around with your focus throughout your career? What’s your take on that?
Steven: Yeah, you know, it’s interesting. I think focus really does help you get.
Steven: A tremendous amount of understanding.
Steven: Of a particular customer.
Steven: And in this case, you know, the customer isn’t always me. It’s a small business owner.
Steven: And I’ve gone to small startups and bigger companies.
Steven: So having.
Steven: That ongoing.
Steven: Understanding of customers and their.
Steven: Changing needs is hugely helpful.
Steven: Plus, you get.
Steven: To know the.
Steven: Who are the.
Steven: Partners you might want to.
Steven: Work with? What are the channels that work?
Steven: And this lesson was really.
Steven: Driven home in between Intuit. And when I went to.
Steven: Go be the CEO outright, I spent about two and a half years at a brain fitness gaming company.
Steven: And I brought.
Steven: Leadership skills there, but I didn’t bring subject matter expertize, and it really was driven home in the speed of decision.
Steven: Making that I could make in.
Steven: The small business world and how much slower it was. Now it’s.
Steven: More help. I need it in context.
Steven: Creation in the Brain Fitness Gaming Company.
Steven: So the concept of.
Steven: Focus on.
Steven: A particular area and develop.
Steven: That expertize is fantastic. Leadership I think is transferable. Management skills are transferable.
Steven: At a particular domain.
Steven: Expertize is really.
Steven: Hard to replicate.
Bronson: Yeah, that makes a lot of sense. Is it the case that when you’re at a company, you’re actually seeing other pain points for that particular customer that you’re not serving and you’re getting ideas for maybe what the next startup might do or how they might fulfill a different need in that same audience.
Steven: Yeah, every time you.
Steven: Talk to a customer, you learn something.
Steven: New. And so being in a market, you know, again, with the opportunities that I had at Intuit and then outright and now GoDaddy.
Steven: To focus on small business.
Steven: Every time I talked to somebody, either they were delighted.
Steven: With something I was doing or my team was doing. They were.
Steven: Unhappy. And as.
Steven: You hear those pieces of.
Steven: Feedback over time, you get a really good picture of who.
Steven: Are these small business owners, what.
Steven: Do they care about? And you can.
Steven: View of is that idea really in the.
Steven: Direction that a small business is going to see.
Steven: Value or not? And having that and that’s not a or you have.
Steven: Five conversations and you.
Steven: Know it over time you develop more and.
Steven: More nuanced views across.
Steven: A variety of different things you need.
Steven: To do to serve that small business the product.
Steven: The marketing.
Steven: Care, even things like billing and how.
Steven: You speak to customers in those situations that seem.
Steven: Minor in.
Steven: Our perspective, serving the customers that.
Steven: Are huge pain.
Steven: Points that small business if you get it wrong.
Bronson: Yeah. Now did you set out to have this kind of focus in your career? Did you set out, you know, day one, you’re out of college, I’m going to serve small businesses? Or is this something that only makes sense when you look back at it?
Steven: Yeah, it’s funny.
Steven: You can look back and tell yourself a beautiful story about how you meant to get here.
Steven: But no, this was not.
Steven: And it’s funny, my.
Steven: Dad is actually a professor who studies small businesses and entrepreneurs for.
Steven: A living. So even.
Steven: When I was a kid, I was steeped.
Steven: Small business research.
Steven: But that was not top of mind for.
Steven: Me. I was in investment.
Steven: Banking at an undergrad and was in grad school, and I remember a very vivid.
Steven: With a.
Steven: Mentor over the second year of graduate school.
Steven: I was thinking about what I was going to do post graduate school.
Steven: I was thinking about doing the startup where I was.
Steven: Thinking about doing a consulting job.
Steven: And I was asked.
Steven: Right, what do you want to do in ten years? And the vision.
Steven: That I distinctly remember.
Steven: That discussion was I said, Look, I want to.
Steven: Help a technology company grow.
Steven: I didn’t say I want to help a small business focused.
Steven: Technology company.
Steven: Grow as a technology.
Steven: Company grow. And what happened after that was a ongoing opportunity to go work.
Steven: With small businesses. And each time I had that chance.
Steven: It gave me an opportunity to go deeper and deeper and understanding the.
Steven: Needs of those businesses and serving them well.
Bronson: Yeah, no, that’s great insight. And just something I want to share for our audience here is, you know, in your case, it’s been going from success to success kind of in the same domain expertize. But even if you have failures. And you do something else in that same space, you’ve learned a lot and you might be able to, you know, build something for them better the next time around. And so I really think there’s something to this kind of staying in your lane. And that’s actually a quote from Oprah. Probably the only time I’ll ever quote Oprah, I’m going back on TV the one time she said, stay in your lane. And that was always remember that shorthand phrase of there’s so many opportunities. Stay in your lane and then you get to reuse all this expertize you’re building up over your lifetime.
Steven: Yeah, that’s a great quote. And I’ve had a couple of.
Steven: Failures along the.
Steven: Way, which maybe we have time.
Steven: We can touch on those too now.
Bronson: Yeah, I don’t know. We may have so much. You have so much success. I don’t have time to get to the failures. Let’s talk about your latest acquisition outright. Outright was acquired by GoDaddy, like I said, in 2012, if I have it correct, you had about 200,000 users when you guys were acquired. Is that the right number?
Steven: That’s right.
Bronson: Yeah. So first, tell us, what did Alt-Right right do for its customers? And then we’ll dig into kind of how you got to such a large number of users.
Steven: Yeah, the pain point that we saw.
Steven: Was over half of small businesses are using pencil and paper and spreadsheets to.
Steven: Know how they’re doing from a financial.
Steven: Perspective, what types of hands.
Steven: Like thing, what type? Yeah, is that crazy revenue.
Steven: And expense and just trying to.
Steven: Track day and day out.
Steven: How is my business doing.
Steven: And basically doing it manually and they were really unhappy with.
Steven: That. If they used pencil and paper, it was a negative net promoter score. Spreadsheets were.
Steven: Neither of those things are good.
Steven: And so the view we had at the time was there’s all this data now available in the cloud. How do.
Steven: We connect small businesses to.
Steven: Their own data.
Steven: Assemble it in a way that it’s easy to digest.
Steven: And then.
Steven: Use that.
Steven: To know both? How am.
Steven: I doing so I can make good decisions.
Steven: Day in, day out? And how can I now.
Steven: Use that information to be able to prepare my taxes, which is also a very big pain point for small business.
Bronson: Okay, so you guys are kind of the glue pulling together these different data sets, is that right?
Steven: That’s right. So all about and connect.
Steven: That small business to.
Steven: Their bank account, their credit card account and e commerce account and.
Steven: Payments account like.
Steven: A PayPal.
Steven: And so those are the types of data that.
Steven: We can go without.
Steven: Having the small business do any.
Steven: Manual or reaching of data, bring that data and give them a consolidated view both on the web and on.
Steven: Their phone so they always know how they’re doing.
Bronson: Yeah, you know, it seems like that’s a theme that’s kind of a glimpse of the future because there’s so many APIs now, there’s so many datasets, there’s so many companies with siloed data. And we had one of the guys on from the foundry and he talked about glue being one of their, you know, basic principles they’re looking for. And now look at companies like Zapier and some other guys, and they’re bringing together all this stuff in creative ways. And I think there’s going to be a lot of companies that kind of do what outright did in a lot of different verticals eventually. I think there’s a ton of opportunity there.
Steven: Yeah, totally. In fact, small.
Steven: Business owners.
Steven: They got into business in order to serve customers well.
Steven: They want to really.
Steven: Make their customers happy, whether they sell products on the.
Steven: Whether they’re a service business that’s going to someone’s house or place of business.
Steven: Or a.
Steven: Retail establishment. All those folks got in a business because they had a particular skill. They’re not because.
Steven: They’re an.
Steven: Accountant and certainly not because they’re a.
Steven: Web developer.
Steven: Trying to stitch different data sources together.
Steven: So now that the data is.
Steven: Available, it’s the customer’s.
Steven: Data that’s helped.
Steven: Make it easy for them to get access to that information and use it to make their business more successful.
Bronson: Yeah, big data is useless if you can’t get your hands around it.
Steven: Yeah. So what’s interesting about that in the way we got to that couple hundred.
Steven: Thousand customers was in fact.
Steven: Tapping into that data. So one of the one of the.
Steven: Perhaps next questions that I was.
Steven: Thinking about is, okay, how do we.
Steven: Get to that scale as a startup?
Steven: Basically no marketing.
Steven: And what we saw was this data.
Steven: Particularly with eBay, was just unleashed. So back when the.
Steven: Company was started.
Steven: The opportunity.
Steven: As we.
Steven: Looked around.
Steven: Was where is a data source where there’s lots of transactions. There are customers who in the past have had to do this.
Steven: Manually and the information.
Steven: Itself is easily accessible to.
Steven: Us to be able to build a product on top.
Steven: And eBay had just opened up in the apps marketplace.
Steven: They had an API.
Steven: So their transaction data was available.
Steven: And we tapped into that API, built a the one of the product that included.
Steven: A sales and transaction data.
Steven: Import and then engaged.
Steven: Basically all.
Steven: Of our marketing.
Steven: Which was basically.
Steven: Half of.
Steven: Every person.
Steven: In the company. And it wasn’t a real marketer at the time. Go engage with that community, go in and work with the eBay.
Steven: Evangelist and the advocates, go to.
Steven: The eBay.
Steven: Locally, be active on the.
Steven: Boards so we.
Steven: Could build the product quickly and meet.
Steven: The needs of that base.
Steven: And then have the word of mouth be our.
Steven: Best, our best tool to growth. Fact That’s what happened. So we focus.
Steven: Reiterated fast and then we built very quickly up to the.
Steven: Top position on the eBay marketplace, both because we started.
Steven: Early and we responded.
Steven: To customer needs that were.
Steven: That were real.
Bronson: Okay. So I see. So you actually used kind of the Go Daddy marketplace, and there’s a lot of companies doing this now. You know, Shopify has their own marketplace. MailChimp has their own marketplace for B2B companies that are serving the market. That’s similar to kind of be there as a supporting app. And so you guys use the data. You knew that there was some way to serve GoDaddy or now go daddy. But yeah, sorry, I misspoke. Yeah, eBay customers. And then you use that data, you build it into your product, and then you just kind of relentlessly go after them and get them using your product. So did you email them cold? You just went to meetings and meet ups. I mean, you just kind of did anything you could to get in touch with eBay customers.
Steven: That’s why it was funny. We we they were a little we didn’t know it at the time. They were a couple.
Steven: Of different newsletters that focus on ecommerce sellers. So we.
Steven: Go in and explain to them what we were doing, go on eBay radio.
Steven: Show. So there was a radio show aimed at eBay sellers.
Steven: Right? There are.
Steven: Conferences where those eBay guys go, so you get to know that customer really.
Steven: Well. And then as you’re.
Steven: Talking to those customers, they say.
Steven: Oh, and you know what?
Steven: I also sell on Etsy.
Steven: Oh, I also sell on Amazon. Right.
Steven: So so that started to coalesce for us, a very clear strategy on let’s go serve small e-commerce sellers as well. And then we saw sellers, e-commerce sellers grow.
Steven: So we would go up.
Steven: With some of the product.
Steven: Capabilities there. We added additional.
Steven: Data sources that they told us they needed to.
Steven: Make sure that we bring all their data.
Steven: In. So Etsy and Etsy then launched an apps marketplace in an API. Amazon. And we just marched across the landscape.
Steven: To build a great product in the.
Steven: E-Commerce space.
Steven: And then over time, we started to have.
Steven: Other businesses show up.
Steven: And say, Well, hey, I don’t sell online, but I do.
Steven: Send invoices out, can.
Steven: You help me around my payments.
Steven: Needs? And so then we said, perfect.
Steven: Now that we’ve got a product that was getting very high net promoter.
Steven: Ratings on the.
Steven: Based business side, we saw we had a gap around service based businesses. And in fact, that’s when.
Steven: GoDaddy knocked on our door. And the GoDaddy.
Steven: Base, like most small businesses around the world, are primarily service based businesses. So then we started to need to solve those problems around estimates and invoices and payment processing, because, again, most of these folks are.
Steven: Sending paper and.
Steven: And written.
Steven: Invoices or word document credit invoices which don’t get tracked. So small businesses don’t wind.
Steven: Up getting paid for all the work they’ve done. So we’re like, great. We can make that a.
Steven: Really simple round trip.
Steven: And speed up the.
Steven: Process for the small business, make it easy.
Steven: For their client, and make sure that no.
Steven: Invoice ever slips through the cracks by tracking.
Steven: That automatically for them.
Bronson: Yeah. Do you recommend that other entrepreneurs kind of imitate that strategy where you went after eBay, even though it almost seems like a niche within a niche. Within a niche? Yeah, it’s so Tim, it’s so tempting to say I’m going to go after small businesses, I’m going to go after anyone who does transactions online. But you said, no, let’s focus on eBay and kind of get a pillar that we can work from. Do you think companies fail for not doing that?
Steven: Yeah. So the the I think.
Steven: About this is we have.
Steven: A grand vision.
Steven: We do have to start.
Steven: With a.
Steven: Very specific customer in mind. So in fact.
Steven: We had.
Steven: A poster on our.
Steven: Wall of Gabrielle.
Steven: Gabrielle was a a seller who was on.
Steven: EBay and Etsy made her own jewelry. And we had a very.
Steven: Laser focus.
Steven: On that, what we call.
Steven: In target customer.
Steven: If you get it right, then target.
Steven: Customer, you show that those people use the product.
Steven: They find value. Guess what? Other folks that aren’t.
Steven: Exactly that customer will also use the product.
Steven: And then you’ll.
Steven: Start to extend. But if you start with we’re here to serve small business, it’s really hard to.
Steven: Build a product for.
Steven: A small business because that is such a broad.
Steven: Category of people and you just.
Steven: Can’t make it stick.
Bronson: Yeah, you can’t make the messaging about them, you can’t make the product features about them, you can’t build something. They’re going to fall in love with that. It’s going to work for everyone, which means nobody really loves it on day one.
Steven: That’s right.
Steven: And the tension is if you.
Steven: Build for a vertical.
Steven: And that’s and that’s the vision you get, you truly do get stuck in a.
Steven: Vertical. So you have to have what I call a horizontal problem.
Steven: So managing your finances, pay your taxes.
Steven: Is actually applicable to.
Steven: Every small business.
Steven: So we needed to have that.
Steven: As the vision, but we targeted a very specific customer when we got started. So it’s that.
Steven: That tension of you need to.
Steven: Pick a specific customer, but you can’t get trapped in just serving that customer. So you have to pick a problem that’s applicable to.
Steven: More types of businesses that look like that customer.
Bronson: Yeah, that’s a great insight. There’s a lot right there. You mentioned the word Net Promoter Score a couple of times, so I’m guessing that’s a huge kind of indicator of the use internally with your businesses and the things you’ve built. Real quick, define that for us because a lot of people have heard it, but how do you actually talk about Net Promoter Score?
Steven: Yeah, so.
Steven: I was very fortunate. So a little history when I was at Intuit.
Steven: Fred Reichel.
Steven: Who’s the guy who invented the Net Promoter Score as a measure of customers willingness to.
Steven: He was a.
Steven: Consultant. Scott Cook, who’s the founder of Intuit, was at Bain. So Scott and Fred talked and in the early 2000. And Fred actually came over, was looking.
Steven: For a company in the tech.
Steven: Space to apply his methodology. So in to it sucked that we were some of the first folks to get to work on it. And it’s a very simple methodology. You ask your customers, would you be willing to.
Steven: This company’s product or service to a friend or colleague? The score is between a zero and a ten. A zero is no way.
Steven: Not at all.
Steven: A ten is absolutely.
Steven: And then you take the.
Steven: Zero three sixes and you sum those up the numbers of people who respond. Those are called your detractors. You take your nines and tens. Those are your promoters, and you actually.
Steven: Take the.
Steven: Numbers and ten subtract the zero three sixes from.
Steven: That and divide by that set and you get a.
Steven: Percentage. And the most you can ever get you can imagine is 100.
Steven: I give all.
Steven: Nines and tens and know 036 is the worst you could get is a.
Steven: -100. That would be a disaster.
Steven: Every person who uses your product hates you.
Steven: And every category.
Steven: Has a slightly different score. So cell phone providers generally are pretty low scoring folks. Cable companies are pretty low. Airlines, except for Southwest, are pretty low. Nordstrom, USAA, Apple Score in the sixties and seventies, and that’s a world class score.
Steven: So with the outright product and now they’re good at in my book, you put back.
Steven: Your scoring in the sixties.
Steven: And so when we think about that.
Steven: That was a way.
Steven: We were doing well. The GoDaddy.
Steven: Customer care team, for example, you can measure it transactional net promoter score as.
Steven: And that’s one.
Steven: Of the, I think huge.
Steven: Advantages that we saw with your daddy was that they’re at scale with thousands of customer care reps and they have a net promoter score in 60, which is tremendous for customer care. So that’s a really powerful metric.
Steven: You can.
Steven: Then use.
Steven: The qualitative feedback.
Steven: And then I’ll stop talking to the.
Bronson: Question. This is good.
Steven: Stuff. So. So you get the net promoter score.
Steven: But that doesn’t tell you exactly what to go do.
Steven: So you ask a very simple follow up question in the same survey. That’s Why did you rate us? That’s worked so 0 to.
Steven: Checkbox. Give us the score and then why did you rate us that score? And it’s just an open ended box. And those two things together actually create a.
Steven: Lot of power that allow.
Steven: You to take back to your.
Steven: Team the real.
Steven: Words that customers are.
Steven: Giving you.
Steven: In terms of the description.
Steven: Of the product. And it can get everybody rallied around a very.
Steven: Compelling score.
Steven: That Fred, Richelle.
Steven: And his book is called.
Steven: Loyalty Rules Loyalty. In fact, there are a couple.
Steven: Of books he’s written in.
Steven: You’ll find it out there.
Steven: He was able to.
Steven: Link Net.
Steven: Promoter Score to future growth rate. So if you.
Steven: Are a higher net.
Steven: Promoter score product or service than others in your category.
Steven: Will grow faster than your competitors. Okay. So that was a really.
Steven: Piece of research that he did and he showed it across.
Steven: A number of different categories.
Steven: Of products and services.
Bronson: Yeah. Is the inside behind a net promoter score? That word of mouth might be more important than you want it to be. You know, as marketers, we want to just buy more ads. We want to know that everything is in our control and we can pull the levers, we can make the graphs go up into the right is the insight that word of mouth is actually going to decide the future, maybe more than some of the technical things we can do.
Steven: In in the consumer.
Steven: Space and in the small business space. Absolutely.
Steven: There’s just not enough marketing.
Steven: Dollars in the.
Steven: World to be able to get the word of mouth effect overridden by marketing. I think about.
Steven: Marketing spend is on the margin.
Steven: Moving the needle.
Steven: And I also think about marketing spend is in a category. We have lots of folks who have reasonably good product.
Steven: You need to find a way to take.
Steven: Each of those companies.
Steven: And get your voice heard above them. But the.
Steven: Thing that makes a company.
Steven: Great in long.
Steven: Term sustainability.
Steven: Winner in a space is great product experience, which turns into word of mouth, which can be measured. Be a net.
Bronson: Yeah. Now that’s great. Now outright not as a detraction against it, but it doesn’t seem like a very sexy business. It’s not the kind of thing that TechCrunch writes about on a weekly basis. It’s not the kind of thing that everyone’s, you know, proud to wear the t shirt of it. And yet it’s it’s fulfilling a real B2B meat and potatoes kind of need in the marketplace. And you guys did extremely well. Do you think that entrepreneurs are more drawn to the glamorous stuff when maybe they should be drawn to the things that aren’t exciting and aren’t necessarily consumer facing, but have real potential?
Steven: Yeah, you know, I talk to this point all the time with friends and would be entrepreneurs. People will.
Steven: Pay you if you solve a real.
Steven: World problem. I think you have to start at that particular point of view.
Steven: And if you see.
Steven: That problem in.
Steven: Our case, if you help small businesses be more successful.
Steven: They’re going to be around longer, they’re going to create more jobs, they’re going to be an engine for the economy.
Steven: So I.
Steven: Think you can create an incredibly rich story for your.
Steven: Creates a long lasting.
Steven: Real, true North or North Star where every day and come into work. Look at that feedback from your.
Steven: In our case, small business customers are telling us you.
Steven: Helped me make my.
Steven: Business better.
Steven: You helped.
Steven: My business.
Steven: You helped me.
Steven: Achieve my dream of saving.
Steven: Enough money to go to Disneyland, or literally.
Steven: One of our customer’s dreams every year.
Steven: And and that’s.
Steven: Because we solved.
Steven: A real world.
Steven: Problem. So I think consumer apps are fun. There’s a lot of.
Steven: Things that that can make life better and.
Steven: Emotionally more rich, enriching.
Steven: But taking a problem that helps a.
Steven: Business stay in business.
Steven: That’s that’s huge.
Steven: And that makes such a big.
Steven: On those around us and the community around us.
Steven: Again, to tie why outright became part of Go Daddy together you’re part of the give it out a.
Steven: Vision was to tilt.
Steven: The world’s economy in.
Steven: Favor of small business.
Steven: And that gets me fired up, right? That gets people to come in and really work.
Steven: For the intrinsic reasons. In addition.
Steven: To the money and.
Steven: Other upside, it’s, hey.
Steven: I am making a.
Steven: And you can point right to that.
Steven: Small business customer.
Steven: Who you helped.
Bronson: Yeah. You know, it reminds me of a book that I that I saw recently called Absolute Value, I think is the name of it. And it was saying that in the future, absolute value is going to be what matters in the sense of what true value my providing, not what was the headline of what value I said I was going to provide or what was the promise or how cool our culture is. But then in the day, what is the absolute value I’m providing for a customer? And that’s really going to be an indicator of, you know, the growth potential and the long term viability of the company. And that stuck with me as an idea.
Steven: I love that. And it’s.
Steven: When what’s interesting there.
Steven: Is when you have a compelling mission, then the key.
Steven: Is how do you connect that to the day to day executions? Those two things.
Steven: Have to meet and there’s some wonderful ideas around clean water and clean energy. But if you.
Steven: Can’t to execute on that stuff.
Steven: You also don’t.
Steven: Deliver. So it’s.
Steven: Building a great company.
Steven: That’s sustainable in the long term is around.
Steven: A compelling problem.
Steven: That small businesses in our case want to tell you or consumer or others solving that.
Steven: Problem. Well, and then every touchpoint.
Steven: With that customer is an opportunity to execute well.
Steven: If you don’t execute well, learn and get better.
Steven: So I think.
Steven: The the opportunity from.
Steven: My perspective, is compelling mission.
Steven: Create real value and then work like crazy to get better every day.
Bronson: I like that. It’s a good three step process. Now let’s talk about GoDaddy a little bit. So you’re part of the GoDaddy team for a couple of years now. You’re the senior vice president of applications, and it seems like a big part of what you do is acquire companies. You guys have acquired a number of companies since you were acquired. Tell me what is kind of the grand strategy behind GoDaddy? I think I know based on our talk so far, but I’ll hear from you. What is the world look like in the future for GoDaddy?
Steven: Sure. So the strategy that.
Steven: We’ve been working.
Steven: Towards the last couple of years is is.
Steven: Really clear and a lot of.
Steven: Folks don’t know it. So I’ll take a couple of seconds to walk through that. So the vision is this idea that we’re going to transform the world’s.
Steven: Economy, make small.
Steven: Businesses more successful.
Steven: So how do we do that? And we think about a couple of key things that.
Steven: Small businesses need to do to start, run and grow their businesses successfully. So the small business owners, they.
Steven: Need a name. So when we think about.
Steven: The first thing a small business does today.
Steven: When they’re getting up and running.
Steven: Or they’re an existing business that wants to.
Steven: Get found on the Web, well, I need my own.
Steven: Place to.
Steven: To be found. So I need a domain name.
Steven: And there’s a lot.
Steven: Going on in that.
Steven: Marketplace that’s fun and interesting.
Steven: That we could talk.
Steven: About. So step one.
Steven: Get a name. Step two, you need a place on the.
Steven: Web that represents.
Steven: Your unique.
Steven: Value proposition to the world. As the small business owner.
Steven: I want my.
Steven: Website, I.
Steven: Want my.
Steven: Mobile site, I want my social presence to explain.
Steven: What I do and who I do it for.
Steven: So I’ve got to get that online presence and that can.
Steven: Be a do.
Steven: It yourself website building.
Steven: Product. That could be a.
Steven: WordPress build site, that could be a hosted site that a designer.
Steven: Or developer builds for you. And in fact, it was a work in a world.
Steven: Roughly shapes out half and half half of small business owners build it themselves, half hire someone else.
Steven: But I need an online presence. And, you.
Steven: Know, this joke has now been around.
Steven: For 20.
Steven: Years since I was in the Web in.
Steven: The early days. If you build it, they will not come. So so then you need to go out and get it out.
Steven: And so there’s a set of marketing services that we want to deliver to those small businesses.
Steven: And finally, once you’re up and running, you have a bunch.
Steven: Of things you have.
Steven: To do that make your.
Steven: Business successful.
Steven: But they’re not.
Steven: Going out and serving customers. They’re not.
Steven: Going out and.
Steven: Finding customers.
Steven: They’re things like email and payment.
Steven: Processing and taxes. And so what we think about are those four pillars as the underpinnings of the good old growth strategy.
Steven: Get your right name, get an.
Steven: Online presence, get marketing services to attract and retain customers, and then run your business well. And those are the four things that are.
Steven: Are guiding our internal.
Steven: Efforts to build better products, partnership efforts like the Office 365 partnership we announced a few months.
Steven: Ago and.
Steven: Like the one we did for Loku.
Steven: Which is is.
Steven: Providing the power underneath our get found.
Steven: Products. So so we look at those build by.
Steven: Opportunities at every chance in those four big buckets and it’s fine.
Steven: We’ve built.
Steven: A lot of good stuff for the past.
Steven: Year and.
Steven: We’ve acquired some things and we partnered in some areas as well.
Bronson: Yeah. Now you may not be able to disclose this, but as you kind of look out at where the hole still are, where do you see, you know, where you want to be? Build something or you want to acquire something. What’s the small business needs that you know are not being met? Kind of going back to what we said earlier about unsexy businesses that really fulfill needs and absolute value. Where do you think there’s gaps in the market? There’s just a waiting for somebody to come in and serve them and make them happy.
Steven: Yeah. So this is going.
Steven: To blow you away. But, you know.
Steven: Half of small businesses in the US alone still don’t have websites.
Steven: So when I look at our core markets that we’re in today.
Steven: I think we start there.
Steven: I think we look.
Steven: At just the.
Steven: Fundamental of.
Steven: Consumers and other businesses are searching for a small business.
Steven: On their phone, on the web.
Steven: That’s the first thing that they do. And it’s not just a Silicon Valley thing. It’s across the U.S. and now it’s.
Steven: Becoming across the world. People pull out their mobile phone.
Steven: We’re looking for service.
Steven: They open up a browser.
Steven: Or a search box and they go.
Steven: So I think the area that that we’re going to continue to.
Steven: Focus on is those four pieces. Let’s get these guys.
Steven: Online in particular, and then that.
Steven: Extends globally, too. So we’re taking those four problems and we’re.
Steven: Driving that across the world Latin America, Europe.
Steven: Asia. So so we.
Steven: Have a lot of work to do. And I think all.
Steven: Four of those areas are still ripe.
Steven: For opportunity.
Bronson: Yeah. So you’ve been on both sides of the equation in terms of acquisition. You’ve been acquired a couple times. Now you’re the guy doing the acquiring. When should a company consider an acquisition and when should they be headstrong and do their own thing? You know, I think about Snapchat turning down an obscene amount of money, and I don’t understand that if they were a public company with that much money, it would be a win and they turn it down. So I don’t know. But how should we think about acquisitions?
Steven: Yeah, you know, a couple of words of advice. One, I think.
Steven: Businesses should build their business under the assumption they’re going to.
Steven: Have to run independently forever.
Steven: So so build a great business and the rest will take care of itself.
Steven: And if you’re building.
Steven: A great business that solves a real.
Steven: World problem.
Steven: Is bringing.
Steven: That true value to a customer. People will come knock on your door and you’ll be part of the industry.
Steven: You’ll begin to have customers talk about you, partners talk about you. And at some point, someone’s.
Steven: Going to likely come knock on your door and say, Hey, we’d love for you to be part of.
Steven: Our business.
Steven: And I think at that point, every entrepreneur, every founding team.
Steven: Their boards have to sit around and.
Steven: Think through, well.
Steven: What’s next for us as a business?
Steven: When Intuit came and knocked on our door back in 1996, we were looking at the online insurance.
Steven: And thought quite a bit about what it was going to take to make the impact we wanted on the.
Steven: Insurance shopping experience for millions of people, and we saw the path.
Steven: Go independently.
Steven: Was raising a ton.
Steven: More money, building the brand, trying to get.
Steven: The insurance carriers to sign on with us faster.
Steven: And we compared that likelihood.
Steven: Of success to becoming.
Steven: Part of Intuit, building into the Quicken product itself, and then Quicken Financial, which became quite an icon.
Steven: The insurance shopping experience.
Steven: I could bring that brand instantly.
Steven: Into an insurance carrier like a state farmer and Allstate and.
Steven: Say, I can build your brand into our product.
Steven: Which will be distributed to 10 million households. And we as a leadership team talked about it and said we’re.
Steven: More likely to make an impact on the world being part of the.
Steven: Intuit space.
Steven: And our cultures were quite compatible.
Steven: So so that was a personal decision there. And similarly, when GoDaddy came.
Steven: We were talking to them back in.
Steven: The summer of.
Steven: The company didn’t have a Silicon Valley presence, so we knew.
Steven: We could we can be a beachhead for bringing in new talent to the company.
Steven: We saw the 12 million customers.
Steven: That GoDaddy had and thought, wow, we can bring.
Steven: Another service that these customers desperately.
Steven: And we saw the scale that they.
Steven: Were operating at.
Steven: With customer care and some of the tools that we didn’t.
Steven: Yet have built and thought we.
Steven: Could accelerate.
Steven: Our ability.
Steven: To help small businesses.
Steven: And again, the cultural fit there.
Steven: Was I had seen once before the story.
Steven: Of a company that was building great products and how they’d grown.
Steven: Over a long period of time. And I saw that same opportunity as part of.
Steven: GoDaddy back.
Steven: In 2012.
Bronson: Yeah, I like your answer because it’s filled with just a lot of realism. It’s not being overly optimistic. It’s saying, okay, this is who we are and what we have to work with. Can we actually make this huge impact on the world given what we have realistically? And it’s not a, you know, a knock against people when they’re just real about how, you know, what the chance of succeeding on that route is and then making a wise decision.
Steven: Yeah. And then it’s important for me and.
Steven: Again, this is going to be.
Steven: Varying by entrepreneur, probably important for me to bring my team along in.
Steven: That discussion. So we.
Steven: Had the leadership team in.
Steven: Both situations where those were opportunities. Part of those discussions at the.
Steven: Point we thought, okay, this is real enough, let’s bring them in and explain.
Steven: Who these folks are, introduce them to.
Steven: People they might be working with.
Steven: And I’ll do the same thing. On the flip side, in the past, when I worked on acquisitions or partnerships, you make those connections real so that you.
Steven: Understand how the company works.
Steven: Who are.
Steven: The people I work.
Steven: With? What are the expectations of.
Steven: Me as the company coming into a bigger firm? And I think.
Steven: Having those.
Steven: Authentic and open.
Steven: Discussions, I save.
Steven: A lot of heartache down the.
Steven: Road. It’s not about the money. If you’re a successful company, they’re. Lots of ways for.
Steven: You to monetize the company you’ve built. It’s about.
Steven: What’s the best way to.
Steven: Continue that that mission going forward, and how can I help the.
Steven: Customers that we started out as part of.
Steven: Our mission? How can we help more of.
Steven: Them be successful?
Bronson: Yeah, you know, you mentioned bringing in your team on those discussions, which is a very, you know, kind of authentic thing. You use your word, it’s a very open thing to do at any point to bring them in. And it kind of leads me to my next question, which is I read online that if you could start a startup book club, that the first book you would assign to people is true North by Bill George Yeah. What are some of the insights in that book that make you say, that’s the book I want entrepreneurs to read because I think it might have something to do with what you just said about how you manage your team.
Steven: Yeah, you.
Steven: Know, it’s it’s a.
Steven: It’s interesting because real, real life intersected with that book for me quite compellingly. So I had an opportunity to work with a.
Steven: Bunch of really spectacular leaders.
Steven: Both independently at Intuit.
Steven: And folks like Scott.
Steven: Cook and Bill Campbell.
Steven: Gosh, Brad Smith, the current CEO there.
Steven: Bill Harris, Laurie Norrington.
Steven: Steve Bennett, like this whole.
Steven: Group of people, each of whom had a different way of leading.
Steven: And I’d seen that a little bit in graduate school as well.
Steven: Where there wasn’t one style of leadership.
Steven: That was successful. And so that.
Steven: Got me thinking.
Steven: From the start that.
Steven: You need.
Steven: To first be true to yourself.
Steven: And then I read the book True North by Bill George.
Steven: That’s the first thing he says is, look, you need.
Steven: To be an authentic leader. Trying to emulate somebody else.
Steven: Is unlikely.
Steven: To lead.
Steven: To success. You need to be.
Steven: Comfortable in your own skin. You need to be able to not put on an act or a.
Steven: When you’re at.
Steven: Work versus at home.
Steven: You want to be.
Steven: Your whole self.
Steven: And we talked about, you know, bringing your whole self to work, live passionately.
Steven: And those.
Steven: Things are are for me values that that book.
Steven: Were front and center.
Steven: And then he he’s it some other I think very.
Steven: And even more pragmatic things he talked about.
Steven: You start with your employees. If you start with employees who are excited and.
Steven: Engaged and they will go that.
Steven: Extra mile for the customers. If the customers feel.
Steven: That you care about them, you hear their.
Steven: Voice, you’re.
Steven: Making improvements.
Steven: Even when you screw.
Steven: Up. If you take ownership of that, they will stick with you.
Steven: And if your customers are sticking with you and you solved an important.
Steven: Problem, going back to what we talked about earlier, a real world problem, they will buy your product and.
Steven: Shareholders will be delighted. So you start with employees, make sure that.
Steven: They are committed and.
Steven: Engaged, understand.
Steven: Their connection to the objectives of the company.
Steven: Customers then get served well. If customers are served well, shareholders be delighted. So he talks about that concept of customer and shareholder.
Steven: And then I.
Steven: Think the last piece that that I took away and this.
Steven: Again resonated with me from where I’m just wired.
Steven: Is the concept of intrinsic motivation that.
Steven: You know, it’s very hard to compel somebody with more and more money over time, with.
Steven: Rewards over.
Steven: Time, that if you can.
Steven: Get folks to internalize why we’re doing this, you can be mission.
Steven: Driven. If you can have that, you’re again going back to the good attitude here.
Steven: So we’re going to tilt.
Steven: The world’s economy in favor.
Steven: Of small business, because.
Steven: That’s the only way we’re going to get.
Steven: To hundreds of.
Steven: Millions of people out of poverty.
Steven: Is to have.
Steven: Them create their.
Steven: Own jobs.
Steven: But they’re not going to work for IBM. They’re not going to work for other big retailers.
Steven: They have to create their own jobs.
Steven: That’s pretty compelling. People will come work for you if you can create that.
Steven: Intrinsic motivation.
Steven: And you still need to pay people. Well, there’s.
Steven: No question that.
Steven: At the end of the day, people are going to go.
Steven: To a place where they’re.
Steven: Feeling that their needs are being met. But once.
Steven: You get above a certain.
Steven: Level of comfort, Maslow’s hierarchy.
Steven: It all becomes around intrinsic motivation. And so for.
Steven: Me, those three things that you talked about, the authentic leadership employee.
Steven: Customer and shareholder.
Steven: And this concept of internal motivation really resonated.
Bronson: Yeah, you know, I love all three of those so much, and I think it’s actually going to be pertinent for our audience because a lot of our audience are starting for the first time in a startup or they’re leading a team, maybe for the first time in the real world. It’s not a graduate case study. They actually have people they’re paying now. Yeah, it’s hard to be an authentic leader because all we know sometimes is a book we read. We know about Jack Welch’s style of leading. We know about how the Navy SEALs lead. You know, these are books that have on my bookshelf, you know, and it’s like I read them and I’m like, there’s some good advice there, but it’s not me. I mean, it’s not how I’m going to do things. Yes. They need to know it’s okay to come into your own. I think also about the second point, I’ve really seen the connection between shareholders and customers because they’re taking investment money for the first time and they think the world revolves around the VCs. And it doesn’t. It revolves around the customer because the VCs want you to serve the customer because that’s how they win. And so it all three of those and especially the intrinsic motivation, you know, in the startup world, there’s almost too much talk about money. We’re driven by it to a fault. I think when intrinsic motivation actually gets you more money, if that was your goal anyway.
Bronson: So there’s three of those.
Steven: Totally. They fit they fit together nicely. One of the things that I.
Steven: Remember in some of the board discussions I’ve had over.
Steven: Time, when you’re talking about the shareholder, you’ll have a.
Steven: Lot of discussion because it’s such an easy to measure thing like.
Steven: How much money did you make? How much revenue?
Steven: How much did you raise in the last round? The customer never sees that. The customer doesn’t.
Steven: Know who your.
Steven: VCs are.
Steven: And maybe in the B2B.
Steven: Space and the enterprise level, they’ll.
Steven: Go take a look.
Steven: But the small business owner, Hey, did this customer get delighted? Did this service meet.
Steven: My needs and did the employee I talked to on the front lines.
Steven: Whether it’s.
Steven: An email or a chat or they.
Steven: See your spirit come through in your marketing efforts or at a trade show, those things are what’s going.
Steven: To move the needle on.
Steven: The business’s success in the shareholder piece is an output.
Steven: You have to you have to do it.
Steven: It’s critical.
Steven: Right? You have to make money to keep going and invent new stuff. But that’s that’s a trailing indicator. The leading indicators are are my employees.
Steven: To be here?
Steven: Are my customer telling others they should come use my product? If so.
Steven: Then you’ve got a good.
Steven: Model underneath what you’re doing.
Steven: The shareholder stuff is an output.
Bronson: Yeah. Now that’s great. Oh, this has been an awesome interview. Steve and I have one last question for you, is the question that ask everyone at the very end. So you kind of taken in any direction you want. It’s so vague, but what’s the best advice you have for any startup that’s trying to grow?
Steven: Well, it’s interesting. We’ve talked about.
Steven: Some of these concepts already so that I can patch them together to solve.
Steven: A big problem, but have a very.
Steven: Specific customer in mind. So start by.
Steven: Picking a laser like focus on an end.
Steven: Target customer to solve that problem exceptionally.
Steven: Well. And then your job.
Steven: As the CEO or one of the senior leadership team members of a startup is to build.
Steven: Your team, build your team, build your team by hiring the right people, coaching them, growing them. I think about.
Steven: One of the biggest transitions I had to.
Steven: Make in the early.
Steven: Days of the startups I was a part of is, you know, my job was initially, let’s get the.
Steven: Product out the door. But very quickly it.
Steven: Changed from focused on the product to focus on the company. My job was to.
Steven: Build the company, get the right people, get the.
Steven: Right structure and set the.
Steven: Right values.
Steven: So that as we.
Steven: Added more people that were doing the day to day work, it all hung together.
Steven: They understood why.
Steven: We were here.
Steven: What our purpose was, who our customers were.
Steven: And where we were going. And that’s a really important.
Steven: Lesson that.
Steven: I think.
Steven: Folks often forget is they’re trying to build a lasting company.
Bronson: Yeah, well, Stephen, that is awesome advice to end on. Thank you again for coming on Growth Hacker TV.
Steven: Thank you so much. That was a great discussion. I appreciate it.
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