By Brett Hurt, Wharton MBA 1999; Vice Chairman and Co-founder, Bazaarvoice
On February 13th, I had the honor of keynoting at the First Round Capital CEO Summit in San Francisco. During my speech, I promised to put my notes up on my blog and so here they are.
I started off my talk emphasizing that the journey matters most in your transformation from founder to CEO. It is both a beautiful journey and also at times a gut-wrenching one. You aren’t born knowing how to either found a company or be a CEO. You aren’t born knowing how emotional this journey can be. But it is a journey that, in my opinion, is the most profound journey that one can take in a career. It is a journey that led to me being recognized as Austin’s best CEO for the large company category last year. This doesn’t mean I have done everything right or that I don’t make mistakes (hopefully less of them are repeat mistakes).
So here are my 7 lessons on this transformational journey:
- The CEO must be the Chief Culture Officer. A founder-CEO especially cares about the culture because they breathed the soul into a new being (the company) and like a parent they should care how that being evolves from child into adulthood. Some companies have a great brain, fewer have a great heart, and even fewer have a great soul. The CEO should care about nourishing the soul. You can tell when a company has a great soul just by walking the halls and feeling the energy. Does the company give you energy or does it take your energy away? Nothing says more about your culture than who you hire, who you fire, and who you promote. The CEO also has the ability to shape how the company serves its communities. I chose to establish the Bazaarvoice Foundation in our first year of our life. I was influenced by watching the documentary, The Corporation, and I encourage you to watch it if you haven’t already.
- The CEO must constantly work on self-improvement and regularly take the time to reflect. After graduating from Wharton, I felt that my business education was just beginning. I had founded Coremetrics during my last semester and was now in the real, raw world of being an entrepreneur. I chose to read hundreds of leadership and management books in my first two years post Wharton to help me in my journey. I believe that books are read by leaders and magazines and newspapers are read by followers. A book causes you to think more deeply because decades or centuries of knowledge are nicely summarized.The CEO should also constantly seek out mentors. The reason I gave this talk is both because of how much First Round Capital did for me at Bazaarvoice but also because “to teach is to learn” (a mantra I live by in my own practice of reflection). I am the product of many mentors. The CEO should also leverage a CEO coach, much like I leveraged Kirk Dando, who is now a very close friend. For our IPO at Bazaarvoice, I leveraged three additional coaches – one to help with Earnings Calls, one to help with investor Q&A, and one to teach me how to present to investors on the roadshow.I also talked about the importance of vacation in taking the time to reflect on what you have learned. I took 5-6 weeks of vacations every year at Bazaarvoice and I believe this made it a better company. Sometimes these vacations would give me the clarity of mind to let go of an executive that I had been holding on to for too long (perhaps due to loyalty even though they had scaled out). Sometimes these vacations made me sharper on strategy. Sometimes these vacations helped me focus our company more. It is easy to get defocused as a young company.
- The CEO should own the long-term vision of the company. The CEO should carry this torch and light the fires with everyone – investors, employees, clients, and partners. This will create tremendous energy – both for the CEO and everyone else. The CEO also decides when to sell the company or keep growing. This is aligned with the long-term vision. How bright is the future? What kind of impact do you want to make? As I mentioned in this Lucky7 post, we could have sold Bazaarvoice for $25 million after our first year in business. Instead, we chose to go long because our long-term vision was too attractive to sell at such a price and we built a company that had a much bigger impact as a result.
- The CEO should always treat recruiting as a top-three priority. This includes upgrading your team. I mentioned that Stephen Collins was our third CFO and ultimately became my successor. Three CFOs in six years. This isn’t easy and again reflecting on vacation helped. As CEO, you will be defined by those that you choose to report to you. If there is dysfunction at the top, there will be a huge ripple effect throughout the company, causing dysfunction at the bottom. At Bazaarvoice, we relied on a rigorous recruiting process that mostly served us well (no recruiting process is perfect). I’ll refer you to this Lucky7 post where I discuss our unique recruiting process in great detail. People are the raw material of your culture – and ultimately that means your performance. Rapid growth brings out the best – or worst – in people. Recruiting your Board should especially be a focus. It is much harder to fire a Board member if you have made a mistake. Don’t get starstruck by pedigree. Spend the time to really get to know them and check their references.
- The CEO should choose to celebrate regularly at All-Hands meetings where vision, alignment, and transparency prevail. At Bazaarvoice, we chose the Alamo Drafthouse for our quarterly All-Hands meetings. This venue was tremendous because it was counterculture. Everyone arrived relaxed. Drinks – including beer – and food were available throughout the day. With it being a fun movie theater, most presenters tried to one-up each other with the funniest – but most informative – presentation. We had a film festival. We had a band. All metrics were revealed. Everyone knew how we were trying to be aligned and what our goals and progress were. Early investors that witnessed them were wowed. They were my favorite days at Bazaarvoice – second only to our Client Summits. Only the CEO can choose for the entire company to spend this time together.
- The CEO should evolve systems to keep everyone aligned. I was very influenced by Marc Benioff’s book, Behind the Cloud, where he discusses his V2MOM model. I chose to make this simpler and call it the declarative b, in homage to our b: logo (the colon stands for something profound follows and you can use it in many ways such as b: bold, b: changing the world, b: transparent, etc). The beauty of the V2MOM model is that everyone participates and forms their goals to be aligned with the corporate goals. If you know how you are performing and that it is indeed aligned with the overall strategy of the company – then your work will be more fulfilling as a result. And this allows the company to constantly measure and constantly improve. I only wish that I had discovered this model earlier.
- The CEO should embrace vulnerability. Everyone is watching to see how you will behave – and, to a large extent, they will mimic your behavior. At Bazaarvoice, we practiced vulnerability by reading books like Fierce Conversations and having training programs around them. I discuss this more in this Lucky7 post. We enabled individuals to regularly rate managers on whether or not we were living the core values. After all, are they just values on a piece of paper or are we – as managers – going to truly live them? We regularly ran Climate Surveys for everyone in the company to evaluate our overall culture. These are difficult practices. But to not do them – and not make them a priority as CEO – is to turn your back on the voice of your people, which ultimately will affect not just your culture but your performance. The best speeches I have given at Bazaarvoice have been where I have been vulnerable. Like the time I hired an executive that didn’t reflect our values and had to explain in front of the entire company how I had made a mistake. Or the time that we faced the Great Recession and stopped hiring to protect our people. It made us a much stronger company at the time to pull together like that. Your people need you to be human.
I really enjoyed speaking at the First Round Capital CEO Summit, and I hope this post helps you be a better CEO.
Adapted from the February 15th post on Brett Hurt’s Blog Lucky 7.
Bio: Brett joined Austin Ventures in 2012 as a Venture Partner and focuses on early-stage software investing. Brett founded Bazaarvoice (NASDAQ: BV) and served as CEO and President for seven and a half years, leading the company from bootstrapped concept to almost 2,000 clients worldwide and through its successful IPO. Brett continues to actively support Bazaarvoice as the Vice Chairman of the Board of Directors. Prior to Bazaarvoice, Brett founded Coremetrics. Brett holds an MBA in High-Tech Entrepreneurship from The Wharton School and a BBA in Management Information Systems from the University of Texas at Austin. Brett established the Bazaarvoice Foundation and is very active in the philanthropic arena.