This fireside chat with, Nicolas Dessaigne, CEO @ Algolia and Edith Harbaugh, Co-Founder & CEO @ Launch Darkly, discusses building a culture that scales. In the early days, Nicolas mentions how Algolia’s culture continued to break as he scaled. As of today, with 250 employees across 5 offices, his culture is now scalable which led Algolia to become the highest rated SaaS company on Glassdoor. Take a listen to see what could help you scale the culture in your SaaS startup.
Also, if you didn’t attend SaaStr Europa, we’re having it again in 2019. Be sure to grab tickets before October 1st because prices will be going up come November 1st. This is your very last chance to grab tickets starting at $199!
Transcript
Nicolas Dessaigne | CEO @ Algolia
Edith Harbaugh | Co-Founder & CEO @ Launch Darkly
Edith: I am very much thrilled to be in such a beautiful venue, Nicolas has told me that every time I come to Paris he gets his portrait on the wall and there’s a lovely crowd so I’m really honored to be here to do a fireside chat with him.
Nicolas: You’ve got your portrait, too, over there.
Edith: Well, I’ll start by introducing somebody who I admire very much, Nicolas has been a huge inspiration to me, he has shown that you can sell awesome products to developers, he has built a wonderful company and not only that he was just named one of the, the number one SaaS company to work for on Glassdoor. So not only a brilliant guy whose building a great company, but he’s also paying attention to the internal culture.
Edith: So today we’re going to talk about culture and how that fits into start ups.
Nicolas: Thank you Edith, yeah, how to start, maybe a few words with Algolia and then we’ll go in to it.
Nicolas: In case you don’t know us, Algolia is a search API, we basically help businesses to deliver a great search experience on their own websites, on their own apps, so if you search on Twitch, Under Armor or Medium you’re basically using us. We met with Edith, was that three years ago? Actually because of Jason, the guy there, because we, Jason invited me to speak at about like fillers, at Heavy Beat and Edith was there at the time, maybe you can explain a bit more what you do too.
Edith: Yeah, I’m Edith, I’m the CEO and Co-Founder of Launch Darkly, we do feature management platforms. We allow SaaS companies to turn on and off features for their own customers and do slower roll outs. So, we have European customers like Typeform, Contentful and Apiary, so its great to be here in Europe.
Nicolas: A lot of API.
Edith: So something we were talking about, before is that we both have a technical background and so we’re talking about how you can approach culture at a company as a product, can you talk a little bit about how you’ve approached culture and why it’s important.
Nicolas: You know, culture as a product, how do you think about product, you have versions, you have iterations, you have bugs. So basically a culture is a living thing. You’ve never finished your culture, like you’ve never finished your product. You may even have a roadmap for your culture. What’s the next step you want to build? Maybe we can speak about the history of the culture, like how it changed, how it failed, what we had to change.
Nicolas: I know you had like some experience or so on your side on this one. You want to start speaking of Launch Darkly first? And then I can continue with our version?
Edith: I’ll be upfront. I did not start the company when I was in my 20’s or when I was in my 30’s so it was deliberate that my co-founder and I wanted to have a company that we wanted to work at. We knew we wanted to go to work everyday and we work hard and just feel like this was a place where people wanted to come to work. So culture was something we deliberately tried to incorporate in terms of , are we enjoying ourselves? Are our employees enjoying themselves? Cause then I think it shows the product and it shows in the experience that you are delivering to your customers. How did you approach it?
Nicolas: Yeah, so it changed a lot with time. The first thing is that in our case, I mean we are in our 30’s too and we knew what we didn’t want to have in the company. We had worked at big companies before suffered a little from that and wanted to make sure as co-founders that were a properly aligned on the type of company we wanted to build. We didn’t speak about culture as like kind of a concept yet but that was basically what we were discussing. And for us that was around that concept of ownership. We wanted to create a company of owners. People who would get out of their comfort zones. Take initiative. Behave like they were the owners of the company basically. We didn’t hire anyone for one year. So it was really, the inception of the company. Actually I gave my notice the day after we agreed on the type of company we were going to build.
Edith: Wow. So it was just you and the co-founders for how long?
Nicolas: About one year.
Edith: And then when you hired your first employees, how did the culture change?
Nicolas: Well in the beginning everything was alright. The thing is that when we arrived, when we got to nine, ten people, things started to break already. Okay we had that culture in mind, we knew what we wanted. We were making sure during the interview process, we were discussing about that. We’re pitching our culture. But the thing is that when people join you they are going to revert to their habits. That’s human.
Edith: What do you consider a bad habit? Cause we had the same break point when we were up to about ten people, we would make everybody go to lunch with us, and we would make sure this is somebody that we wanted to get lunch with. But then when we get bigger it starts to break. So what was breaking for you?
Nicolas: Started to break like decision process. You want owners. You want people to take initiative. You don’t want them to take orders. And simply yes, there were sometime waiting and not taking the right initiatives and not behaving like it was their company.
Edith: How did you fix that?
Nicolas: Simple fix. We wrote down what we meant by ownership. By what was our culture. That was a simple wiki page. One page long, explaining what we were doing and that was it.
Edith: Did it work?
Nicolas: And to some point. Like until 30-40 people that’s when it broke again.
Edith: Its interesting we were talking about how you have all these break points at different stages, like 30 is kind of the stage where you start to have managers and managers.
Nicolas: You got it. That’s actually a good example of what was not working so well. When we were like 40 people, what happened is that, we would ask something and oh no we can not do that at a go. Why? Because it is not in our culture. Why? What do you mean by that? And that was the case with management. Why can’t we have managers? Because its our culture. Why? I mean our culture is to be flat. We want owners who are flat. We are not going to grow at 1000 people being flat. So that’s when we realized we had to go beyond a simple wiki page and we started the work, that was in 2016, a bit more than 2 years ago, to define really who we were. So that ended up in five core values and really separating who we are, the core values of the company and how we work. How we work should change everyday. As you scale, having managers, manager of managers. You simply cannot work the same at 10,30,200, 1000. That should change constantly. Who you are should barely change.
Edith: I mean something we were talking about is that, the stuff that got you to where you are might not get you to here and that culture you said sometimes people think of culture as a compromise where culture should really help you grow.
Nicolas: Many people think that, yeah, I mean that’s kind of like common assumption that either you choose culture or you choose growth. You have to make a choice. You cannot keep a great culture if you want to grow fast. I believe that its very wrong. I think its true at the short term, but its creating a culture that, you know like that notion of technical debt that we all have in our companies, you need to revisit that and constantly reimburse it or otherwise it gets too big, I think culture is worse.
Nicolas: If you start creating some culture of debt, repaying back cultural debt is way more difficult because people, you create habits, you create a behavior, and people are going to, its so difficult to change the way you work. So you need to be very intentional on the way you want to work today and tomorrow and that helps. I don’t want to speak too much about like the Glassdoor thing but actually, that’s because of the culture, and because of that, that helps us to hire, I mean, you know how it is, like the biggest competition for us is to find the right tenants and having a great culture is going to help you attract the right tenants.
Edith: Advice I got was the footpaths that you make in your company, the early foot trails, become the superhighways of three years later.
Nicolas: That’s very true. We are actually also discussing about sales in an engineering company, which is a big part, a big challenge for a culture of a tech company. But Edith and I have like a ales motion for our product. You want to share how you do that?
Edith: Yes so like you our first year was basically just building the product. So we had all engineers, I was the sales person, and I had been at companies where there was this huge divide between sales and engineering. Its really painful I’m sure some of you have been at a big company where sales and engineering are kind of at open warfare about you know, why do the sales people get to go to club? Why do these lazy engineers play fusball all day. And its not a healthy culture. So something we try to do at Launch darkly is that we sell to developers. So our sales people have to understand developers. So advice I got from you was
Nicolas: Very similar.
Edith: Yeah, I got so much advice from you about, make sure that your developers would buy from your sales people. Cause if they don’t you are not gonna be able to sell to developers that are not yours. So we do a lot things in our sales org that comes from engineering, like we do a monthly retrospective where we go over what worked what didn’t work and its kind of like a no blame post mortem of just how can we get better. So that’s part of our culture is that we’re very reflective. I mean but I love it, you are up to how many employees now?
Nicolas: Nearly 250.
Edith: Across how many offices?
Nicolas: Five offices.
Edith: How do you make that work?
Nicolas: I’m not sure we have made that work yet. Its still very challenging. We were lucky to participate in 2014, and that pushed us to open an office in the US very early on. And so very early on we had that two offices, Paris and San Francisco and we had to figure out how to work together. And so we iterated it. Its like a culture as a product. You basically iterate. You try to do new things. Some of the key things that helped us, language, only one language. We only speak english including and in our Paris office. So its often surprising for people. That has actually been such it trends to attract very diverse candidates coming from all over Europe. And that was incredible and its a big asset today for us. We sell all over the world. So having people coming from everywhere is such an advantage.
Edith: Do you ever get push back from candidates saying, “hey, we are in Paris, why do I have to speak english?”
Nicolas: Naturally. Kind of like its a filter. We get more attractive for foreigners, but we know that we don’t have full access to the local talent pool because not everyone speaks fluent english. So yes, but it kind of like you know, most of our customers are outside of France and we want everyone in the company to be as customer facing as possible. We want everyone to be able to speak with customers, to interact and engage. So of course we need them to be able to speak english.
Edith: What other things have you done to help you recruit the right people? We talked before about how culture fit can sometimes be a narrow way to get recruits but how do you approach recruiting and getting people into your culture?
Nicolas: The thing with culture, of course you want to make sure about who you hire. I don’t really like the term culture fit, because it goes basically against diversity. Because you are going to hire more of the people that fit your concept of who we are. You want culture additive people. You want more values fit than a cultural fit. Which means that you need to test the values. So we have five core values and we are going to test each of them during interviews. Actually interviewers some of them have to check one value. So they know which value they have to check. They have been aware, they are going to check it.
Nicolas: We equip them, as much as possible template questions, so that they can pick from there if they don’t know what to ask. And that’s going to help make sure that the people are the right ones.
Edith: Yeah. That’s kind of where the rubber hits the road. I had a challenging situation. We were interviewing somebody and he seemed very competent, and then every single reference call I did, they opened with ,” well you know he is a jerk.”
Nicolas: Did you hire him?
Edith: No. But it was very hard cause these were like, you know, and then like how bad of a jerk? And they were like people won’t work with him anymore. Then I’m like this is not somebody who is very competent then.
Nicolas: Be careful about that. That’s the worse that could happen. You are supposed to be multiplier. Founders the more people you have in the company, the more you will think about your leverage. How you spend your time to multiply your impact. If you hire bad, like a jerk or someone who really doesn’t fit in the culture in the company, that’s a I don’t know what’s the diff, the opposite of multiplier, like a divider. Like its going to harm everyone else. Everyone is going to be less productive at the end of the day.
Edith: And if there is somebody who you actively dread interacting with that shows up everywhere.
Nicolas: That would be a terrible choice to do that. You are like 50 people today?
Edith: Yeah. We are 50.
Nicolas: Did you two have like some bugs in your product? Culture product?
Edith: I think. So we just closed our B round. So we closed at 21 million dollars B round and a year before that we closed about a nine million dollar A round. After the A we were hiring very quickly and I will put the blame on myself. I think I just assumed culture would happen. We had about three people who joined and then again very quickly quit because they just said its kind of sterile, its boring and I was like well this is a project then. That’s why I said that this is a your company is a product so I was like I’m not building a good product. The stickiness is not there.
Edith: So to put it in, so the classic way you look at a product is, are you attracting people? Are you acquiring them? And are you retaining them? And then do they have referrals. I mean that’s you could figure your company. So I’m like I’m attracting people, I’m acquiring them but I’m not retaining them. This is bad.
Nicolas: Did you change anything then?
Edith: We made it explicit OKR, so we run off objective and queue results. Every quarter we do objective OKR’s around culture, which might sound a little dry but like every quarter we are like okay, this is what we are gonna do. And our OKR for this quarter is actually to hire a formal director of people cause we realized that we were a size where all the initiatives I wanted us to do were bigger than I could really do.
Nicolas:Â A big learning for all of us. Nobody I mean maybe second timers, but people building a company that have never done that before, its impossible to anticipate the need of the people function. I mean we are nearly 250 now last year we need the year with one person in people and that was definitely not easy. You had so much to put in place that you don’t know about yet.
Edith: And their projects that take time. Like we wanted to do good performance reviews and you realize to do good performance reviews you really need somebody to own that. Its not something that you can say, “hey, lets go do performance reviews.”
Nicolas: And then of course don’t forget about including culture in your reviews. You want to make sure that the people in your reviews are a good match for the culture. That’s a kind of like a circle where we go round all the time.
Edith: So we talked about bugs in culture so the thing that I discovered is that I needed to pay attention to it. What other bugs or kinks did you have to work out?
Nicolas: Lets fast forward a little. Control is the never ending project. So I told you last time, just before, that the last big iteration was to create our culture key value, core values. It really worked well. I can still feel today, we always had that. It been a bit more than two years but for me we started with these core values. Its so core to us. We do everything to involve them. Sometimes very simple by the way like small hacks. I’m sure most of you use slack on [inaudible 00:18:13] we created small emojis for culture. So every time someone displays some cultural values we can add the small emoji on what they say. That’s simple but kind of to influence concerned with the culture.
Nicolas: Every time we speak and there is a wet wooer, refer to the culture, we do so too. But as we continue to scale, the core values, I told you we separated the core values from the way we work. What we realized was someway, is that the way we work should receive as much attention as the core values. And that is something that we didn’t do so well before. So we were becoming a bit complacent about the values. They were so great. We have great values of the culture we set. It worked on that. Never. Its never finished. The way we work is not always great. Especially when you hire lots of people, you can make sure they understand the values but then they come with other habits to. So we have to, that’s our current stage. We call that operating principles.so that’s what we are working on today. Just to do the same interns work on the way we work as we did in the core values.
Edith: We do an onboarding session with every new hire, where I walk through the history of the company and their values. Do you do something similar with yours?
Nicolas: We do, so that, I mean reiterate to, many things that don’t scale. We still interview every single person my co-founder and I, but most of them after an hour found their cheque and we split. In the beginning we were doing like, each of us was going to do a lunch with each hire. Well that doesn’t work anymore.
Edith: That’s a lot of lunches.
Nicolas: Well yeah. That would be a lot of lunch today. I know but what we do today, we split and we do group lunch, so I’m going to see half the company, he is going to see the other half. He is based in Paris. I am based in San Francisco so its an easy split. So that’s the way we do that. Then on the onboarding side actually that’s something we are going to add. We’re like refining. That’s another thing, onboarding. Constantly iterate on it. One for next duration is to add a culture session done by the founders and not by other employees because we believe that’s a great thing to win. What else? One of the latest things I started to do, I mean, three weeks ago, so really recent, is to do round tables as a founder with individual contributors. So I would gather eight – ten people of the same function. I deal with contributors not the managers, and ask them two questions in a round table fashion, what’s the one thing that’s really going well for you? And what’s the one thing that is really going bad for you?
Edith: Wow
Nicolas: And that triggers the conversation and that’s incredible how much you learn from that as the founders. You just listen. You don’t push back. You don’t try to answer. Of course you want to act on what you learn after. And it creates also discretion and you listen and they feel they are listened to. That’s a good one.
Edith: Yeah. I also got another tip from you about how you run your leadership team meetings. That you start them with a check in.
Nicolas: We start with a check in around now. Just how are you doing? You know could be ten seconds, could be 60 seconds each. But just to move from like you know business, now before to go into business lets do that shaking and see how you are feeling and maybe something bad happened to you during the weekend. You want to speak it out. We can support each other. It kind of helps us to connect better.
Edith: Yeah I took that. Except that we do it at the end and you always tell me I should do it at the start.
Nicolas: I think its better at the start. I think we are out of time.
Edith: Yeah. So thank you so much for all your tips.
Nicolas: Thank you Edith.
