When the founders of Hotwire reflect on launching one of the first online travel websites in 2000 they describe the early days as “complete and utter chaos. We raised $75 million, hired 100 people and grew as quickly as we could,” Gregg Brockway, the company’s former Chief Product Officer, said. Hotwire was acquired by Expedia in 2003, where Gregg and his co-founders Eric Grosse, Karl Peterson, and Spencer Rascoff remained to lead the team.
Seventeen years later, Gregg and Eric have joined forces again as two of the Co-founders of Chairish: An online marketplace for design lovers to buy and sell vintage and pre-owned furniture.
I recently had the pleasure to sit down with Eric, Chairish’s CEO, who discussed the processes required to scale a sustainable business without the chaos. In today’s featured interview, he provides frameworks for founders to maintain their organization’s pulse by implementing early processes, setting achievable and aggressive goals, and developing a team of leaders.
Lay the Foundation for Longterm Success
The only way autonomy can thrive in your company is when each member of your team has a clear understanding of the organization’s goals. Eric advises founders to repeat team objectives and demonstrate how they connect to the company’s overall vision as often as possible.
“Your mission must be tactical and tangible for all parts of your organization to row the boat in the same direction,” he says. In addition to reinforcing your vision, “you want to highlight all of the little things that are happening, across the company, which make it a reality.”
All hands meetings are an effective platform to clarify your goals and processes, why they are important, and answer any questions your team members may have. Eric strongly cautions against letting these basics get lost. Especially for new team members, who are assimilating into your culture, clarity of goals enables them to make informed decisions and hit the ground running.
It may feel unnecessary, and even cumbersome, to implement values and processes when you’re a team of five because your boat is small. However, as you scale, morphing from boat to ship, it is critical that every individual on your team can confidently answer these three questions:
- Why does our company exist?
- What do we want to contribute to the world?
- How do we achieve that?
Establishing appropriate early processes is like taking calcium vitamins to strengthen your bones: It decreases the risk of future breaks. Ideally, you want to set up your company so that as you scale you can make small tweaks to existing processes rather than implementing new ones. Minor adjustments, like creating a new meeting, are taken in stride and rarely reflected on. A complete upheaval of the way things have been done, or not done, rings alarm bells for your team members and disrupts their workflow. The more you prepare ahead of time, the more seamless your transition will be.
When you feel like a broken record, remember that your team members joined the company because they believe in your mission. Each time you repeat your goals or introduce a process that will help you achieve them faster it demonstrates that you’re getting closer to the future you want to create for the world.
Nothing is more invigorating than a company that is raising the bar higher.
Set Achievable and Aggressive Goals
The only way to cultivate an autonomous culture is to rally your team around clearly articulated goals. This is the framework that Eric and his executives use to shape Chairish’s roadmap.
Internal goals that are both achievable and aggressive arise at the intersection of your company’s strengths and weaknesses. You can unveil them by asking these questions:
- Where is our business doing well? What new opportunities can we capitalize on?
- Where are we struggling? How can we improve?
- What do we need to refine and/or change completely?
As a foundational value, every goal you set for your team must be aligned with the expectations of your broader organization. According to Eric, you should keep these three constituencies front and center when setting new objectives.
- Where do we stand in the industry?
- How are our competitors performing?
- Where can we improve?
- Based on our resources and operations, what goals are realistic?
- How and where can we raise the bar to better serve our customers?
Board of Directors:
- How are we communicating and fulfilling our commitment to our investors?
Maintain Your Company’s Pulse
As a founder, you are responsible for constantly reassessing what success means for your company and ensuring that nothing falls through the cracks. Your high-level reflections will reveal predictable and unexpected opportunities.
On one end, you want to lead your team on a relentless quest of self-improvement. Leveraging the areas of your business that are thriving is the first to step to scaling, hopefully becoming profitable, and building an enduring organization that sustains itself over time.
“A really important discipline for young companies is not solely thinking about growth but how that growth is going to grow up and become a real, scalable organization,” Eric says. Having worked in startups for over two decades, he’s witnessed numerous companies that are exceptional at generating revenue but fail to grow sustainable businesses.
To combat that, his team at Chairish is hyper-focused on conversion. As one of the first players in their space, they constantly ask themselves: What are the elements of our service that make us the proverbial first call for buyers and sellers? How can we make them better?
Next, they use a baseball analogy to divide their answers into tactical changes - Singles and doubles - and bigger swings, the grand slam.
Your singles and doubles are achievable goals that your team can develop and test hypotheses for right away.
Your grand slams are drastic additions or improvements to your service that will change the game for your business. At Chairish, these center on challenging objectives such as decreasing shipping costs for heavy furniture.
Eric advises teams to ask these questions daily and understand that risk is an essential part of growth.
“You should treat failure as part of the process towards continuous improvement,” he says. “An outcome is only a failure if you don’t learn from it.”
Externally, Eric encourages founders to be vigilant of customer behavior and changes in the market. Remember to look outside and not be too intuitive. Your responsibility as a leader is to actively unearth areas where things could be going wrong. Arrogance and security are kryptonite for your business.
During his time at Expedia, the company had become so large that Eric cites that they forgot who their customer was. As President, he revived the then 14-year-old company’s founding vision by once again putting travelers first.
The resurgence began by having everyone on the team think like a customer, actively use the service, and then translate their learnings into the product. Your experiences as a customer combined with your deep knowledge of the platform will unearth inefficiencies that may go unnoticed by regular customers. Once discovered, your team can implement integrations to make the platform more intuitive.
The dedication of not just thinking like a customer but being a customer is an important message a leader must send from the top down.
Airline booking fees are one of the flaws that arose for Eric and his team. He describes them as “sugar high revenue boosts that detracted from the long-term health of the business.”
For a business at the size and scale of Expedia, the fees were significant in total amount but actively contributed to the company’s decline in the market. As flights are the foundational step of the travel planning process, losing customers in the first part of the funnel disabled the team from building and testing features throughout the rest of product.
In reflecting, Eric says: “The decision to eliminate those fees and forgo the tens of millions of dollars of revenue that came with them was a hard one, but it was the right one for the business. It not only improved loyalty, it helped us identify and focus on the things that we needed to do to drive constructive change in the product and increase customer satisfaction.”
The mentality proved fruitful, as, during his two years as the company’s president, Eric helped Expedia reverse several years of market share decline in the United States and grew the business by 150% in their Asia-Pacific and European markets.
If you find yourself in a similar situation, catalyze your resurgence by actively exploring these two questions:
- What makes this business special?
- Why will we move on from our struggles and not only survive but thrive?
Develop a Team of Leaders
Regardless of the size of your company, the true measure of your success as a founder is the ability for every member of your team to feel and act like a leader in his or her domain. Autonomy is the result of your efforts to predicate a long term future for your company.
When you’re sprinting against time, capital, and competition it’s vital that individuals feel empowered and capable of making on the ground decisions. An environment where they’re required to approve every decision by upper management can be crippling to your company’s speed establishing and maintaining a strong stake in the market.
According to Eric, the art of letting go can only be learned through experience. As he leads his team at Chairish, his highest priority is that individuals have the freedom to own their roles while simultaneously knowing that they have his unwavering support.
The goal and the best way to maximize your company’s output is to “give your team the benefit of your experiences and let them combine it with their abilities and talent to execute.”
When they do, make celebrating their achievements a part of your company's process. Eric strongly emphasizes the importance of putting others first and acknowledging your team members’ contributions to the business. “You’re only as good as the people who work with you,” he says. “They are the ones who are driving the change and making a difference.”
Images retrieved from Chairish and SBNation.
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