Startup Leadership: What comes first? Just one thing.

 This is a startup tale of success with a simple framework for founders, entrepreneurs and executives looking to grow beyond themselves.

Introduction

As venture investors, it’s easy to say we invest in people, but it’s much harder to find great people to invest in. Harder still is to find those that can scale with the business, and hardest of all is to find combinations of founders that can work together to lead and grow others along with them. I’m privileged to share such a story alongside some great news today. I’m also sharing this story in a generalized form for others to learn not just the company involved. And throughout this story I hope you’ll experience many things that startups face such as balancing vision and execution, growth and change, agility and organization. But in the end you’ll realize it comes back to just one thing.

In the beginning.

Several years ago I was working on my Open Source thesis looking at the OSS projects most likely to disrupt the CMS space. One project was out in front, but on diligencing it I found a divided community with IP problems and no leader to back. By contrast on digging in to Drupal, I found a then smaller but rapidly expanding project and community, with a truly inspiring leader, Dries Buytaert. Of course I chose to back the person, not the project.

I first met Dries, founder of Drupal, when he was a PhD student at the University of Ghent in Belgium. Brilliant and humble all at once, his humility matched his enormous ambition, to transform the world for good with a platform for democratizing the web. Dries’ self awareness caused him to ask for business help and enabled me to introduce the best potential partners to him as he recognized the need to complement his incredible vision with business building execution skills. Dries has so many other exceptional qualities but one in particular that was vital. But let me withhold that for now to introduce our other character.

On the other side of this story is Tom Erickson, someone I’d been lucky enough to work with for many years.  I’d seen Tom build teams that shaped companies from early stage to scale and yet  despite needing to prove nothing to anybody he still had the drive to do it again, at greater scale. Great leaders like Tom hire above themselves and promote others, lauding their success.  The best of them put their ego in check to enable a truly brilliant founder like Dries to shine. To understand Tom you have to know he loves great things, not just good things. He is a fine wine connoisseur who has tested the expense limit on my credit card (!), yet always earned it. Like great sommeliers he literally thirsts for great up and comers and enjoys helping them mature like a great vintage. So I knew that he would not only complement Dries, but would help him realize his vision. Like Dries, Tom has many other outstanding qualities but one in particular that is key. And it meets Dries exactly the way I believe great leaders meet great founders – in the middle. But first a slight detour via the army.

Mission first.

In the middle of my model for entrepreneurial leadership is the mission. And if you talk to any soldier who signs up for the army, they’ll tell you they always place the mission first. In fact they repeat this value in both the Soldier’s Creed and the Warrior Ethos. And there are countless stories of why this is central to winning not just battles but wars.

I’ve seen over and over again how relevant the mission is to startups as a clarifying focal point for resolution of so many challenges. So you won’t be surprised to hear that the exceptional quality I looked for and saw in both Dries and Tom is that they are both entrepreneurial missionaries.

A model for partnership

Tom didn’t immediately have the perspective to fully grasp Dries’ vision let alone mission and so initially he wasn’t ready to become his business partner. Plus Dries was lucky enough to have a great entrepreneurial co-founder in Jay Batson who filled all the gaps to get the business going. Yet everyone recognized it would take more than a big vision and a bold mission to establish an enduring business and ultimately execution would be critical if we were to build a large and enduring iconic company – a goal we all held from day one.

Recognizing Dries’ potential, Tom agreed to join the board so he could figure the rest out. Likewise, Dries wanted to understand what Tom’s contribution would be and it wasn’t until they could see how they would meet in the middle around a common mission that Tom jumped in and owned the CEO role. Rumor has it this coined a now well known Acquia DNA phrase “jump in and own it”. But I can tell you the real story is that it took an amazing dinner over not just one but two very expensive bottles of wine. 🙂

Initially as depicted above, Dries and Tom split their roles relatively simply between CTO and CEO. They owned their respective functions with Dries running product management and engineering at first. However, Dries was clearly accountable for vision and Tom for execution as they focused around the relatively straightforward Mission of supporting Drupal so that commercial entities could rely on it to build their web presence. They literally met in the middle around each customer, owning the success or failure of our products and services. This set a great tone for the rest of the company.

As the business got going they began focusing on the longer term strategic mission of Acquia as a business with Tom accountable to Acquia and Dries to Drupal, while always again working hard to meet in the middle on a mission that was good for both. This included building great products and services to complement Drupal and drive its adoption as a the platform of choice in the enterprise. This has not always been easy for either for them, so they set about defining their measures for success and shared values in a culture to support both the company and the community. One of these values is now in their DNA as “Give back” and Acquia has been a top contributor to Drupal ever since.

As the graphic below (borrowed from Dries’ blog) demonstrates, Acquia was the leading organization credited with contributions to Drupal between June 2015 and June 2016.

This brought into focus a key tenet I believe in – Accountability. And just like any other relationship, founders and executives who are going to work together as business partners for the long term, need to agree on what they are accountable to each other for and establish clear measures for success built on a solid foundation of shared values.

I’ve seen first hand how hard Tom and Dries have worked to ensure their mission binds them and the company together to balance vision with execution. And they’ve made it clear from day one that their measure for success is how they serve and make their customers successful. Acquia is different to many companies even in that regard. Customer success to Dries, Tom and the team is not measured by how much they sell to their customers, but by how much their customer’s business metrics like conversion rates, time to revenue, user engagement and retention, lifetime value and the like are grown in partnership with Acquia. I’ve written extensively on this for others to learn from here.

Thus Acquia and their customers have enjoyed incredible results together, powering some of the world’s largest and most varied digital experiences from NBC’s digital coverage of the 2016 Summer Games in Rio (the largest web event in history) to many of the Governments of the free world as well as amazing corporate customers like GE, IBM, Nasdaq, Nestlé, the BBC and many  non profits like the Red Cross, Doctors Without Borders, the YMCA and universities from Princeton to Yale.

Tom and Dries have fostered a culture of customer success that is not only reflected in Acquia’s exceptional renewal and retention rates, but is captured in anecdotes. I’ve heard from many customers over the years of how Acquia has been by far the best experience that customer had ever had with any technology vendor. Here’s one example:

“For CIOs concerned about open source, it’s the way that Acquia takes Drupal to the enterprise level that makes all the difference And in a time when the web is rapidly becoming the center of the business universe, that’s exactly what we need. With this combination of Drupal and Acquia we can take a very secure approach for doing high-risk turnkey projects. Everything is top quality when we work with Acquia directly, and we can accomplish our objectives faster and easier than would have been possible any other way.” Keyvan Eslami, executive director of IS innovation, Sealed Air.

Meanwhile they’ve worked tirelessly to select an incredible team (either Dries or Tom was in every final interview until they were over 200 people, and most of the time both of them interviewed every candidate) and they’ve worked with their team to build a consistent culture that they call the Acquia DNA. This is an actionable culture with core values such as “do the right thing” and “jump in and own it”. But of course their foremost value in their culture is “Committed to Awesome” for the success of their customers, partners and the community.

This simple framework is the essence of what founders and executives need to agree on to enjoy great collaboration as business partners in startups. Yet of course it requires continuous work to ensure that the measures for success, clarity of operating accountability and compatibility in values remains consistently in tact for the company to scale.

Acquia has now scaled from a handful of people who sat around my office incubating the company to nearly 750 hundred people across the globe serving thousands of customers 24×7 and generating over $150m in revenue last year. Alongside this the leadership team has expanded far beyond Tom and Dries to include executives who have themselves been CEOs of companies of hundreds of people. The overall team includes so much talent at so many levels that it’s hard to give credit to anything other than the organization itself, which has achieved all this.

A mission-driven change

As Tom and Dries and their team have listened to their customers, they’ve settled on a compelling mission to deliver the universal platform for the world’s greatest digital experiences. Stemming from this they’ve also agreed it’s time for a change in their roles to enable the company to meet this mission and the enormous multi billion dollar opportunity it opens up for more products and services to meet their customer’s digital transformation needs. Accordingly Dries’ role is being elevated to bring product innovation, technology acquisition and strategic partnerships to the fore. You can read Dries’ blogpost here for details.

I applaud the decision as it’s also driven by some specific goals to build a public company of over $500m in revenue in the next 5 years. That too will require new skills in the form of a market making business visionary with experience of building a public company scale ecosystem with broad stakeholder support for the business. The Acquia Board of Directors have begun a formal search for a new business partner for Dries who will succeed Tom in that role. Until then Tom and Dries will continue to operate even more closely together in the newly formed Office of the CEO. You can read more in Tom’s blog post and I’m happy to share that Tom will act as Chairman of the Board where we will continue to enjoy working with him.

Ending where we began

As promised I’ve written this post for the benefit of other founders and entrepreneurs who might like to understand these kinds of succession stories. Of course it’s not as simple as this one aspect and I’ve written on other aspects of how founders can scale in my article “Founders Can’t Scale: Fact or Fiction”  and Harvard iLab workshop “Scaling your Startup” on what it takes. But in the end as I promised at the beginning, there’s really only one takeaway from this story. Great entrepreneurs are missionaries, and so the mission always comes first for them. They don’t get sidetracked by changing titles, roles or anything else. They just focus relentlessly on their mission and how to enable others to benefit by becoming part of it. And importantly they’re not afraid to make changes when the mission demands it.

Join me in congratulating Dries for stepping up to leading Acquia more actively with his  incredible vision and Tom for enabling this with his tireless execution. We’re all humbled to be part of it thus far and excited to write the next chapter. Meanwhile Acquia’s cultural foundation and measure for success with their customers will remain solidly in place as will the central focus around their mission.

 

At Underscore VC, Michael and his team partner with entrepreneurs to invest in founders and build from inception to market leaders. As a former entrepreneur turned VC, Michael has backed and built teams that have created billions of dollars of value focusing on large, market-changing technologies such as Cloud Computing, IoT and Big Data as well as disruptive business models such as Open Source and SaaS. Current representative investments include Acquia, Cazena, Demandware (NYSE:DWRE), Mautic and Salsify.

Follow Michael on LinkedIn@mjskok on Twitter, and his Harvard Innovation Lab class Startup Secrets. Follow Underscore VC on the web and Twitter @underscore.vc.

  • MNM

    “In the middle of my model for entrepreneurial leadership is the mission. And if you talk to any soldier who signs up for the army, they’ll tell you they always place the mission first. In fact they repeat this value in both the Soldier’s Creed and the Warrior Ethos. And there are countless stories of why this is central to winning not just battles but wars”.
    And this is the American mindset that I disagree with. A businessman in a business suit is NOT a warrior. He is not there to “take” the next hill. It is this American tendency to reduce everything to the common denominator of War and see everything from the perspective of a battlefield is what is driving American Capitalism (whatever little of that still may exist in its purest form), towards such mindsets and beliefs as “American Greed”, “dog eat dog”, “make it happen”, “war on poverty”, “war on drugs” (and other “wars”) and my personal favorite “whatever works”.
    “Whatever works” implies “whatever it takes” and both expressions and their application imply Pragmatism. There is a difference between Pragmatism and Practicality. A Pragmatist makes decisions on the range of the moment. To him/her, the Good is “whatever works” in a specific instance of Reality.
    If that situation were to arise again, he/she would come up with a different solution and “make it work”. In such a scenario, a Pragmatist is not concerned about Principles, Standards, Values, Ethics and above all, Integrity. He/she is driven by the adage “whatever works in a given situation is the solution at that point in time. We’ll handle it a different way the next time it happens”. They are not concerned if principles etc. are sacrificed and if people are trodden upon.
    If you want to see a perfect example of this, watch Donald Trump in action. He’s the archetypical Pragmatist. He lacks principles, standards, values, ethics and oh yes, Integrity. And that’s because he’s focused on “taking the next hill”. A Pragmatist operates at the Perceptual Level of Consciousness. He is only aware of the concrete instance of a problem. This tendency is also attributed to Lower Life Forms. For example: “See grass – Eat”. “See water – Drink”. “No water – Die”.
    A Practical individual will consider the prefers to approach a problem by generalizing it at the Conceptual Level and also applies the philosophical tenets stated above to ensure that his/her actions do not adversely impact other individuals. His/her Self Esteem perhaps does not allow him to consider his “mission first, at all cost”, ahead of Principles etc.
    It’s the Conceptual Level of Though that separates us from the lower life forms.

  • sanjeev

    Great writeup with great insights on Acquia. Thank you Michael. Your writeups are always inspiring and for many startups, you’ve become an “invisible” Guru. Thank you for motivating the founders with your deeply knowledge filled writings.

    • sanjeev

      It is * “invincible” not “invisible” auto correct from Mac and I didn’t notice…