At the end of 2012, Customer.io was running on fumes. Our revenue was $2500 a month and growing. We'd need about 10x that revenue to to get by with our team of 3 people. We had raised some money and hired a first team member. However, we didn't have enough money in the bank to make it through January.

At this point though we were in a position where getting new investment determined our survival. We got to thanksgiving and I just couldn't get any momentum on a deal.

In response, for the only time in the history of the company, we did a short term consulting contract. It was unrelated to our product, but it got extra cash in to the business. It helped us survive.

The New Year came around and investors jumped at the deal to invest and we got cash to continue.

I didn't forget the lesson though.

As quickly as possible, I ran our business so that only our customers get to decide whether we live or die. We would never be in the position where an investor or partner or anyone other than our customers or us can decide our fate.

I was reminded of my experience while listening to Sovereign Writers and Substack where Ben Thompson shares the skepticism he faced when starting Stratechery:

Whether you're a founder starting a business or a writer starting your substack, there's something incredibly powerful about being paid directly for what you our your company produces.

People are impatient for things that have a slow burn. The progress when you're learning a language or an instrument feels painfully slow in the beginning. If you're trying to get in shape, every squat or pushup burns at first.

Over time if you just keep moving forward, you'll be fluent in french. Or you'll be a great musician. Or stronger than you were.

This is how all change happens. It doesn't matter whether you're working on yourself, or something bigger than you like a company, or the biggest challenges in our society.

The most important thing is to stick with it. Keep making progress towards a goal. Each day you might move only inches. Some days, not at all.

Companies are lining up to do business with my friend's company. He has a sales person handling inbound interest who is doing an OK job.  

There's enough proof that he can sell in to the enterprise. He could replace his OK salesperson with a great salesperson. In addition to order taking, that person could leverage his enterprise logos to go outbound and get more enterprise deals. Then they could start building a team. Most investors would look at that and say that's the right way to take advantage of his opportunity.

My founder friend doesn't have any investors though. He doesn't want to build a company where an enterprise sales process is core to the business.

He doesn't really need to! He has enough customers outside of enterprise companies he doesn't need to rely on them.

As we were talking it made me realize that what he's doing now is fine. Sometimes it's ok to be inefficient! It's ok not to maximize your return on every opportunity. It's ok to do the things the wrong way in one area to save your energy.

As long as things are going very right somewhere else.

I want Slack’s growth, the disciplined efficiency of Zoom, the grand aspirations of Spacex, Front’s ability to raise investment, and Zapier’s ability to never need  investment.

It’s hard not to always be comparing your company or yourself against the exceptions.

You see this on social media too. When you’re comparing your boring life to the person who posts non stop relaxing vacations on the beach. When you’re comparing your bland dinner to the person who posts an amazing spread. When you’re comparing your chubby physique to the person who is bathing suit perfect.

We all do this. This is bullshit behavior. And I think you know this already.

Your company is not those companies. You are not those people. Some of the time, the reality is that those companies aren't as perfect as the articles suggest. And those people aren’t as perfect as the pictures suggest.

If you try to model yourself or your company after the exceptions, you’ll never be good enough.

The real competition, the way you get better, is by competing against yourself and where you are today.

Talking about “A” Players has always bothered me. We don’t (yet) live in Huxley’s Brave New World where you’re assigned Alpha, Beta or Gamma at birth. However, companies can’t stop talking about building teams of “A” Players.

Is it all because of this well known Steve Jobs quote?:

A players hire A players, but B players hire C players and C players hire D players. It doesn’t take long to get to Z players. The trickle down effect causes bozo explosions in companies.

What makes an "A" player? Here is Steve Jobs is talking a little more about the importance of having great people in a team:

"C" player for life.

In Spanish there are two verbs for “to be”. There is “Ser” and “Estar”. The former is for things that don’t really change: I am American. She’s a brunette. The latter is about a current state of being: I’m sad. He is at the train station.

Maybe someone was a “B” player in a previous job. Maybe they didn't do great work in a role at Customer.io.

How someone performed in a particular context isn’t a scarlet letter.

It’s not baggage to take with you through life. It’s specific to a time and a place, and stage of a company. Context is everything.

There are lots of examples of kids in school not being “A” students but being gifted in art or sports. More nuanced even are examples of kids who struggle with learning from lectures but are sponges when they can learn kinesthetically. Even the Kindle acknowledges differences by providing a font to make it easier for people with dyslexia to read. Are people "B" players because they don't read quickly with Bookerly?

The same person may be a success or a failure depending on the situation they’re in.

In a company, for people to be “A” players, they probably have mutually shared values. The current stage of the company and its needs are appropriate for that person. And they fill a gap relative to the rest of the team.

An “A” player at Customer.io may end up as a “C” player at another startup or a “B” player at Google.

That’s ok.

It's really upsetting when we fail to provide conditions for success to someone we hire and they don't work out. Nothing makes me happier to later learn they're now an "A" player in a different company.

I’ll leave you with a reasonably well known story.

In 2001, the Oakland A’s were a struggling baseball team, full of “B” and “C” players — at least by the conventional measures. They had lost their star players and needed to field a competitive team. General Manager Billy Beane, using performance data, created a system for evaluating players. This system allows the Oakland A’s to find players to round out their team who were undervalued by the conventional scouts. That’s a gross oversimplification, but they go on to have a season nobody predicted and win the 2002 American League West title. The Boston Red Sox then used the same system in 2004 to win the World Series for the first time since 1918.

There are opportunities for just about everyone to be an “A” player. It’s all about finding the right context.

Originally written as an internal post for Customer.io in October 2018. I’ve been practicing disagreeing and committing and love when our teams prove me wrong.

One of the hard things about going from 2 people in a room to 40 people in a company is that I have to accept that for almost anything that is happening in the company, someone else has spent more energy, given more thought and more consideration on it than me. Sometimes that means I’m in situations where what someone is recommending goes against the information in my brain. Who is right? Do they see something I don’t? Or does my experience give me insight they haven’t gotten yet.

The lesson I learned is that it doesn’t matter if I’m right. What’s important is that I trust the people on the team to make good decisions. Sure, I want the opportunity to weigh in on decisions we make but once I’ve said my piece either in support or disagreement, it’s time for me to get on board.

I learned about this concept in the book High Output Management by Andy Grove, former CEO of Intel but Disagree and Commit was reinforced by Amazon and a story from the 2016 Shareholder letter in a section on high velocity decision making:

Third, use the phrase “disagree and commit.” This phrase will save a lot of time. If you have conviction on a particular direction even though there’s no consensus, it’s helpful to say, “Look, I know we disagree on this but will you gamble with me on it? Disagree and commit?” By the time you’re at this point, no one can know the answer for sure, and you’ll probably get a quick yes.

This isn’t one way. If you’re the boss, you should do this too. I disagree and commit all the time. We recently greenlit a particular Amazon Studios original. I told the team my view: debatable whether it would be interesting enough, complicated to produce, the business terms aren’t that good, and we have lots of other opportunities. They had a completely different opinion and wanted to go ahead. I wrote back right away with “I disagree and commit and hope it becomes the most watched thing we’ve ever made.” Consider how much slower this decision cycle would have been if the team had actually had to convince me rather than simply get my commitment.

The critical behavior here is committing. It’s easier to find reasons why something might not work than it is to get behind an idea or team and support it wholeheartedly. It takes energy to be positive and lift up your peers. On the flip side, voicing opposition after a decision is made sucks the wind out of everyone’s sails and leaves people feeling drained. I expect that key people in a decision have the opportunity to voice opinions but when the decision maker picks a direction, we support it to give the team working to make it reality the best opportunity to see it through to success.

We have to trust that the people who are closer to it know what they’re doing and that new, better information might invalidate our own assessment of things. That’s how you empower others and trust that good things will happen when you do.

Originally posted internally to Customer.io

In the early days of a company, it’s really valuable to just be able to get things done with duct tape and glue. A critical mistake a lot of businesses make is they build an elaborate system for how things will work when they have customers …. before they have any customers.

If you’re lucky, duct tape will take you to a degree of success without over investing in that don’t matter. The challenge with that approach is durability. Duct tape can paper over a lot of what you’re missing but it’s not a long term solution.

At one point we were running our business using duct tape and it was hard. Companies built with duct tape aren’t fun and they’re not sustainable. Everything was always on fire and John and my stress levels were turned up to 11 🚨.

• Duct tape is Matthew jumping in to handle an outage because we don’t have an SRE team or well defined roles and processes for outages.
• Duct tape is Colin (me) jumping on calls with customers whenever people have complex needs and want to talk strategy because CSMs don’t exist.
• Duct tape is running around like chickens with our heads cut off whenever an IP gets black listed and we’re scrambling to get un blacklisted because we haven’t trained Mike and Joe.

For us to improve the way we work, we need to build systems — not computer systems, but rather ways of handling the work that we do across the business. Systems make that work more predictable and sustainable for the people who do it.

• System building is Brian testing out squads before rolling them out to the whole company.
• System building is Jon evolving our approach to paid marketing by isolating each part of our funnel and running experiments to build knowledge and experience as we ramp up our spend.
• System building is our CSMs testing success interactions, and learning from initial customers before formalizing how we’ll work with the rest.

Building systems forces people to think methodically. It turns you in to a scientist. You run experiments. First, you build a foundation usually from a place of experience that will support the system. You’ll see system builders creating their system in layers. They try something new here, or evolve a process there. Very rarely do they tear everything down and start from scratch. It requires focus and dedication and it’s different than duct tape and appropriate for a different stage of a business.

Building a remote / distributed company is one of the best decisions we’ve made for our business. We started the business in New York, and instead of being chained to that city, I was able to personally move to Portland, Oregon. We’ve also been able to hire amazing people all over the world rather than be limited to hiring from a specific geography.

However, building a remote company isn’t without tradeoffs. While perception of remote jobs is changing, there are some downsides you should know about before building a remote company.

Many investors are skeptical of remote companies

I haven’t met an investor that only invests in remote companies. However, I have met investors that won’t invest in remote companies. I was once told by a venture investor that we needed to move the company to the Bay Area and build our team there in order for them to invest in us. We didn’t.

If you’re building a remote company, your path to raising capital probably won’t look very traditional. In fact I can’t think of an example of a remote company that has a traditional fundraising story.

Acquisitions are tricky

In the Bay Area, it’s not uncommon for Facebook and Google to [acquihire companies for $1 million per engineer]. In the Bay Area where good engineers are extremely expensive and rare, that strategy might work. If you’re a remote company, good luck getting your 5 person distributed team acquihired by Google unless all of you moving is part of the deal. One of our earliest competitors exited in an acquihire and is now working at a customer of ours.

If someone wants to buy your technology and continue to invest and grow it, a remote team is disadvantaged because they’ll be concerned that you can vanish in to the ether. We saw another competitor get acquired and have their technology continue to exist as part of a larger suite.

My theory is that once you get big enough and you’re generating $25m - $100m a year in revenue as a remote business, you’re doing enough right that an acquirer doesn’t care that you’re remote. Before then, it’s a big hurdle to overcome.

Administrative overhead is higher when you’re in more places

Sure, you can hire everywhere, but do you really want to? Adding a hire in a new jurisdiction often means you need to register with the state / province, participate in the jurisdiction’s unemployment fund, and it means you’re going to get strange letters from them in the mail that you may need to respond to.

It would be a lot simpler to have one office and one state and country to deal with for employment issues. The important thing if you do go down this path is get a great operations team in place and get this under control.

People will tell you you can’t build a distributed sales team

You can. We have. It doesn’t make sense to me that people say this since it’s really common for companies to have multiple sales offices and an outside sales team that never goes to the office.

The argument you sometimes hear is that sales people learn from each other through osmosis, and the competitive energy from being in the bull-pen together positive.

We’ve found that through good process and tooling, you can build an effective distributed sales team. For example we have a weekly deal deep dive, and we just implemented a coaching and call analysis tool to help sales reps improve.

We have more work to do to prove this out, but I’m excited to at some point be a strong example people use showing that you can.

You need systems to help people succeed when you don’t see them

There are no watercoolers to congregate by. You can’t tap someone on the shoulder very easily. We struggled with team management until we formalized One-on-Ones and Feedback across the company.

We also do random chats between team members, company meetups and smaller team meetups to help people build rapport with each other. When a new person starts we often do in-person training within a few weeks of someone joining the company.

Interest in remote jobs is increasing

There’s no doubt that people are looking to remote work to help them live somewhere they love while doing something love, or to get rid of a commute, or just create flexibility in their life.

I don’t think remote work is going anywhere soon, and figuring out how to turn a remote team in to a strength is one of the fun opportunities of being CEO of a remote company.

P.S. This post was written from a coffee shop and my house

Sometimes it feels like you don’t have any control over your life. In reality you have more agency than you think. There are lots of little adjustments you can make to design the life that you want for yourself. Some of those things cost money. However, many changes require just a dash of creativity, an ounce of commitment or a pinch of flexibility. Here are some changes I made for myself:

Leave your phone’s “Do not Disturb” setting on

Have you ever watched someone whose phone has clearly taken over their life? They said “yes” to every push notification, and they are constantly being interrupted. What a stressful way to live! If you turn on “Do not disturb”, all those notifications still arrive but they arrive silently.

Never pick up the phone

Technology should serve you, not the other way round. It’s easy to feel like you have an obligation to pick up the phone when someone calls. You don’t. I haven’t picked up an unscheduled or unknown call in over a year and I’m still here.

Block off time in your calendar for yourself

If you work in a company where your time gets filled up with meetings that appear on your calendar, make a meeting with yourself to give you time to think. You might block off 9 - 11 on Monday morning, or all day Wednesday. It gives you more time to focus.

Take a personal day

Many people have personal or mental health days as part of their benefits from work. There’s nothing more empowering than every once in a while deciding “I’m not going to work tomorrow” and spending the day hiking, or going to the movies, or otherwise disconnecting.

Change your work hours to improve your commute

What difference would it make to your commute time if you went in an hour earlier and left an hour earlier? Or what about an hour later? If you can reclaim a half hour a day, that’s about 130 hours a year of time you can get back.

Join a company that is remote-first

This one might actually make you money instead of costing you money. Joining a remote-first company where you work from home or a co-working space can eliminate (or significantly reduce) your commute.

Go to bed and wake up at the same time every day

Going to bed and waking up at the same time every day reinforces your circadian rhythm and helps you get a better night sleep.

Exercise

Exercise doesn’t have to cost any money if you run outside or do pushups and sit-ups at home. I’ve found that I’m most motivated when going to a class with other people and an instructor yelling at me.

What did I miss? How have you made your life better without spending any money?

My co-founder and I thought sales was evil; a dark art that separates people from their money.

A lot of founders from product and engineering backgrounds are skeptical of sales. We were no different. We wanted to build a product people would purchase because it was great. Our product wouldn’t need to be sold to anyone.

After starting Customer.io in 2012, both my co-founder John and I would talk one-on-one with prospective customers. They’d ask us to explain Customer.io. They’d tell us about their business and their challenges. We’d connect the dots when Customer.io could help them and we’d recommend how to use us. If we couldn’t help them, we’d point them in the right direction.

I didn’t know it at the time, but that was sales.

We had no training to sell, no system to track leads or close rates and as a result no way to know if we had achieved product / market fit. We were just talking to people. We were trying to find customers and create allies.

It took us years beyond that early experience before we formalized sales as a function. Here are some hard lessons we learned by not doing things the right way early on:

The More Complex the Product, the More Value Sales Can Provide

What we thought: We’d build a product that would be so simple we wouldn’t need documentation or people to answer questions before someone would buy.

What we learned: Our customers valued flexibility in the product so we made it more advanced. The more advanced our product became, the more people wanted to talk to someone who could help them understand their fit before buying.

Bigger Companies Are Complex and Benefit from a Sales Rep

What we thought: Big companies would sign up and try the software, then they would put in a credit card.

What we learned: At a bigger company, a buyer often has to make an internal case for the purchase. A great sales rep can help the buyer articulate the business value of buying the product to their internal stakeholders.

Create a Sales Plan and Quota

What we thought: We thought that commission plans and quotas meant that people wouldn’t act in the best interest of customers. We were scared that bad sales could degrade how people saw our company.

What we learned: Great sales people love to help their leads succeed. If you hire people who share your company values and give them a well defined plan and quota, they’ll raise the perception of your company to prospective customers.

Make it clear you’re hiring for sales

What we thought: If we hired for “sales”, we’d get people who wouldn’t put customers first so we tried using euphemistic titles like “onboarding specialist” and we didn’t have clear goals.

What we learned: There are standard titles in sales, and euphemisms get in the way of clarity, especially internally. Have clear performance metrics that are sales metrics. New hires will embrace the clarity around how they are measured.

Go After the Customers You Want to Have

What we thought: We’d put the right words on the marketing site, and our ideal customers would arrive at our door.

What we learned: The world is noisy. Some of our best customers have come from word of mouth. However, I’ll be honest: about half of our customers today aren’t companies we’re specifically looking for. If the fit isn’t good enough, that can lead to frustration and bad experiences. Having a mix of inbound and outbound will probably help you build a customer base that more closely fits your ideal customer.

Don’t Make Our Mistakes

If you’re starting a new company and you don’t think sales can add value, consider some of the lessons we learned. There are places your company should innovate, and how customers buy your software is probably not one of them!