Claire Hughes Johnson: prediction

Transcript context

…Do. Coming back to something you talked about with the career ladder, and I had a question around this, you talked about how oftentimes people do it too late, and I'm curious why it's so important to think about the stuff that you wrote about in this book so early in your company's life cycle. I think in the book you mentioned that it's oftentimes as important to get your operational structure and cultural structures in place incorrect as finding product market fit or finding your first few customers, which I think would surprised a lot of people. Can you talk about why you found that to be so important? Not only can I talk about it, I wrote a whole book about it, so let's try to restrain me. But here's what I would say. Obviously product market fit is the most important. And what I do say in the book is focus on that and don't get too far. My book is definitely not zero to one. It's more like maybe 0.5 to 1.5 or one to two. Because I do think when you're smaller and focused on product market fit and finding your user and getting that traction, that shapes a lot of how you work and your goals and who you hire, and that all makes sense. I think the thing that happens though is, one, some companies don't quite realize they're hitting it and they start to get behind on actually building the company part. Because guess what? It turns out product market fit is just the product, and that is not a company, and that will not scale, to point. You see these companies that sort of fall over and there's sort of a bad article about them, and often it's not the product, it's the fact that they didn't actually build the company very well, and that started to harm, in fact harm the product and harm the mission. You have this vision, you're going to solve this problem with this product. And all of a sudden you can't solve it because you didn't scale the org properly. You didn't keep the cultural fabric strong as you grew, right? And so that's why I think it's so important. And so let's say you are hitting traction, and hopefully you do notice it. Because I think a lot of founders, you're kind of paranoid. Like Stripe, I don't think Patrick and John fully embraced that they needed to start scaling maybe until I showed up, and that was part of hiring me. I was like, yeah, this is it. It's happening. It's not just look at the numbers. It's like look at the inbound support demand, look at the inbound sales leads. I just did the math, and I was like, this company should be probably twice the number of people it is right now, which of course freaked everybody out, but it was very obvious to me because I was coming in outside with that perspective. But more importantly, not just scaling things like sales and support... And as you probably know, if you work in payments, you've got a lot of other functions that are very important around risk and compliance and you name it, or the machine learning models and that help you do those things. But for the sort of structures and operating processes that I talk about in the book, I do have this analogy which I think you picked up on to building a house, which is you have the supporting beam. Say it's a post and beam structure. You need the posts and the beams, and then you're going to have to do the mechanicals, right? There's going to have to be some amount of wiring in order for you. I don't know if you have your solar panels, but you got to bring in the heat, you got to bring in the cooling and plumbing, and then you have foundational stuff that you have to build or the whole structure will fall over. ve your solar panels, but you got to bring in the heat, you got to bring in the cooling and plumbing, and then you have foundational stuff that you have to build or the whole structure will fall over. And I think of putting in the posts and beams and the mechanicals and the foundation as actually essential to scale. Because if you do those things well, you build them in such a way. This is almost like a Russian doll kind of thing, but you build them so that they're replicable, right? So the way that you do goals as a company can start at the company level, and this is how OKRs were so beautiful for Google and they can replicate down to the individual. And the same common structure allows that to happen at really different levels of scale. And that's what you're looking for, is what are these common things? We do not a lot of them, by the way. You don't want to mandate a lot, you don't want to put too much structure in place, but enough that everyone can play with it up and down what I would think of as the stack of the company. And if you don't start putting those things in early, people will just invent those things. And then you'll have... Picture a house that got added on to 17 times and it's not even two years old. It looks not super stable. And then you're going to find yourself having to do a tear down, which I think we've all seen companies do that.…

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