Product Power Breakfast #3: Mark Bauer on Product Management in Early vs. Late-Stage Companies, Working with Offshore Development, and What Makes for PM Success

Join Thomas Otter and me for Product Power Breakfast #3 this Thursday, April 8th at 8am on Clubhouse.

Our special guest is Mark Bauer, a career product leader who started on the end-user side as a business planner at Pepsi, flipped to the vendor side at OLAP category creator Arbor Software, which was acquired by Hyperion Solutions which in turn was acquired by Oracle, and then quit a perfectly good job at Oracle to do it all over again as one of the earliest employees at Host Analytics.

In the middle of Mark’s tenure at Host, he took a sabbatical to lead a non-profit (LaunchCode) which provides free education to help people launch their careers in technology.

So Mark really has  done it all:  from Pepsi to Oracle, from behemoths to ten-person startups, from category leaders to category creators, from corporates to non-profits, Mark’s been there and done that.

In this episode, Dave and Thomas will talk to Mark about topics including:

  • What makes for success in product management?
  • Scaling an organization with proper PM ratios
  • The biggest differences between PM at small and large companies
  • Working effectively with offshore development and PM teams
  • Difference he’s seen in PM across different countries (e.g., US, India, Israel, UK)
  • How to best serve the constituents of PM?
  • Inbound vs. outbound PM?
  • Maybe we’ll even sneak in a conversation about technical debt

I look forward to seeing you there!

The Three Un’s of Successful Founders

I’ve worked with scores of founders and companies over the years and I’ve come to make bright-line distinction between founders and managers.  Let me demonstrate it with a story.

One day long ago I was in a board meeting.  We were discussing the coming year’s budget.  The hotly contested question was:  do we spend $8M or $9M on R&D?  After much wrangling, the board agreed that we should spend $8M.  The meeting adjourned shortly thereafter.  The VCs left first and I was walking out of the room with only the founders.  The CEO said to the CTO as we were leaving, “spend the $9M anyway.”

My jaw hit the floor.  I was aghast, dumbfounded.  What the CEO said was literally incomprehensible to me.  It wasn’t possible.  That’s just not how things are done.

At that moment I realized the difference between a manager and a founder.

As a professional manager [1], we grow up climbing the corporate hierarchy.  We have savoir faire.  We know the rules.  We disagree and commit.  We horse trade.  We split the difference.  But, unless we want to do a deliberate end run to the person in charge, we abide by the decisions of the group.  We are team members in an organization, after all.

Founder aren’t.  While they may strive to be some of those things, in this case, the founders were fresh from university, with little work experience and certainly no ladder climbing.  This wasn’t some organization they were part of.  They started it, based on their research.  It was their company.  And if they thought it spending an extra $1M on R&D was the right thing to do, well, they were going to do it.  That’s a founder.

I write this post in two spirits:

  • To former-manager founders [2] as a reminder that you are now a founder and need to think like one.  It’s your company.  Your investors and advisors will have plenty of opinions but if you end up buried, you will be buried alone.  Unlike your VCs and advisors, you have but one life to give for your company [3].  Act like it — you’re not an EVP at BigCo anymore!
  • To investors [4], advisors, and startup execs as a reminder that founders are not managers, even though sometimes we might like them to act more as if they were.

Example:  a founder is raising a seed round off $1M in ARR and a VC is asking a lot of questions about CAC and LTV.

  • Manager response:  “Well, I know a CAC of 1.7 is high but we are ramping quickly and carrying a lot of unproductive sales capacity that hurts the CAC ratio.”
  • Founder response:  “This is a seed round.  I have two barely qualified SDRs and me selling this stuff.  We don’t have a sales model, so why are you calculating its efficiency?  The only thing we’ve been trying to prove — and we’ve proven it — is that people will pay for our software.”

The manager tries to be reasonable, answer the question, and preserve optionality in raising money from this target.  The founder highlights the absurdity of the question, wonders if this is a VC that they want to partner with in building their company, and isn’t shy about letting their feelings leak out.

The first example, combined with many other experiences, has led me to create the three “un’s” of founders.  Compared to managers, founders are:

  • Unreasonable.  Heck, the whole idea of starting a company is unreasonable.  Taking it to $10M in ARR is unreasonable.  Thinking you have the best product and company in the category is unreasonable.  Becoming a unicorn is unreasonable.  There’s nothing inherently reasonable about any of the things a founder needs to do.   In fact, that’s one reason why some founders are successful:  they don’t know what they can’t do.  Don’t expect someone take a series of very unreasonable risks and then be entirely reasonable in every subsequent management discussion thereafter.  It’s not how it works.  We expect every parent to think their child is the greatest and want what’s best for them; the same holds for founders and companies.
  • Uncompromising.  Managers are trained to split the difference, find middle ground, and keep options open.  In essence, to compromise.  Founders can’t compromise.  They know they will fail if they try to be all things to all people; they know the old saw that a camel is a horse designed by committee.  They know intense focus on being the best in the world at one thing is the key to their success.  If one VC on the board wants to go North and another wants to go East, a manager will tend towards Northeast, North, or East.  A founder — because in their mind it’s their company — will make up their own mind about what’s best for the company and potentially travel in another dimension, like up or down.  Getting promoted in a big company is about keeping those above you happy.  Creating a successful company is about getting the right answer, and not whether everyone is happy with it.
  • Unapologetic.  Managers are professionals who are paid to do things right.  Thus, they tend to count negatives like errors and strikeouts.  They apologize for missed quarters or bad hires.  Founders own the team.  They want to win.  While they don’t like errors and strikeouts, they neither obsess over them nor even necessarily care about minimizing them; they’re not trying to keep their resume free of red correction ink.  They’re trying to win in the market and create a leading company.  Errors are going to happen.  Fix the big ones so they don’t happen again, but let’s keep moving forward.  Yes, we missed last quarter, but how do we look on the year?  We don’t belabor the mistakes we made in getting to where we are, we focus on where we are and where we’re going.

I’m not saying all these un’s are great all the time, and I would encourage founders to recognize and appropriately mitigate them.  I am saying that manger-founders, particularly those who founded companies (or took over as CEO) after long successful careers at big tech companies, need to think more like founders and less like managers.

# # #

Notes
[1] Having never founded a company and as someone who has indeed climbed the corporate hierarchy I view myself as a manager — an entrepreneurial, and perhaps difficult, one — but a manager nevertheless.

[2] And, to some extent, first-time CEOs

[3] You are not living, as one friend calls it, the portfolio theory approach to life.

[4] Who probably don’t need the reminder, but the advisors might.

Quick Takeaways from Product Power Breakfast #2

Thanks to those who joined us for the second session in our enterprise SaaS Product Power Breakfast series, Thursdays at 8AM.  The link to our third session is here.

Takeaways:

  • Dave shouldn’t use airpods (and won’t henceforth).  And we need to follow mute/unmute protocol better as these devices pick up the slightest noise and jam the audio of the speaker.
  • We covered what I see as the number one risk in product management as expressed by the all too frequent epitaph:  “they weren’t strategic.”  That is, in their quest to keep everyone happy too many PM leaders end up steadily advancing in small increments across a broad front.  In their effort to keep everyone happy, they make no one happy.
  • We discussed the bicycle wheel problem in PM:  the PM sits at the center of a wheel with lots of spokes and hardest part of the job is managing the pull from each of them.  Spokes, e.g., include:  sales/AEs, sales/SEs, product marketing, analyst relations, customer success, customer support, professional services, existing customers, prospective customers, the CTO, engineering (e.g., technical debt), and more.
  • We had a great discussion of technical debt and types of it:  platform-driven (e.g., built on an outdated one), shortcut-driven (e.g., deliberately took shortcuts), architectural (e.g., designed it the wrong way, overlooked redundancy), and execution-driven (e.g., wrote bad code).
  • We touched on the notion of internal platform, a topic worth a session in its own right.
  • We discussed technical debt vs. legacy code.  (See this for a great discussion of the latter.)  We discussed legacy org vs. legacy code (i.e., with a legacy org there’s little point in refactoring legacy code as you’re likely to repeat the same mistakes).
  • We touched on Trust Releases as a great strategy for managing technical debt, and the role of architects in them.
  • We talked a bit about the challenges involved in adding a second product — a topic large enough to warrant a future session on the transition and associated pitfalls, or as Thomas calls it, the (perilous) second album problem.
  • We discussed the difference between existing core product, new potential core product and bright shiny object (BSO) product/features designed to keep the company at the front of the industry conversation.
  • We discussed strategic vs. opportunistic customers and the CEO’s ability to force sales to “sell what’s on the truck,” particularly to opportunistic customers — if it’s a clearly expressed and enforced ground rule.
  • We (barely) touched on the concept of “holistic PM” and why/how PMs should avoid becoming feature addicts and think of themselves more as GMs, even if the company is years away from having an actual GM structure.

We hope to see you on session 3, Thursday, April 8th, and 8AM Pacific.

Quick Takeaways from Product Power Breakfast #1: Dave Interviews Thomas

Here’s a quick post to share my takeaways from our first enterprise SaaS Product Power Breakfast on Clubhouse.

My Thoughts
Clubhouse is definitely a new medium.  When it comes to new media, I always think two things:

  • The medium is the message and all that Marshall McLuhan’s pithy quote implies.
  • Look for differences, not similarities.  (Saying “Clubhouse is like talk radio” is the same as saying “Twitter is like group text messaging.”  Yes and no, but mostly no.)

Special guest Jason Lemkin was a Tasmanian Devil who — while he blew up my carefully planned structure (think: Eisenhower on planning) — left in his wake a slew of super interesting questions; I literally didn’t sleep well that evening because my head was still spinning.  

Thus, overall I’d give the session an A for thought-provocation and a C for structure.  But we’re new to the medium, trying to figure it out, and serendipity is definitely part of the equation.

Questions Provoked, Topics for Future Discussion

  • To what extent should we talk to startups and founders versus large enterprise product managers (PMs)?
  • How valid is commonality-spotting across unicorns (the spotting is subjective and are the commonalities valid drivers or rabbit’s feet)?
  • The age-old question of how to measure engineering productivity?  Can it even be done?  Is it worth trying?
  • Are story points a valid productivity measure or are they counting angels on pinheads?
  • How can PM avoid being drawn and quartered?  (And how can PM avoid drawing and quartering engineering?)
  • Is product-led growth (PLG) a strategy that must be taken in entirety or can you take a dab of this and that?
  • How can PM best make its voice heard and best work with sales?
  • How to cater between the trend-seeking “new black” and the lasting-principles-seeking crowd (e.g., Crystal Reports was the original PLG company in my curmudgeonly humble opinion)?

In terms of session focus, I’d say my current conclusion is that we want to make each session follow this sort of template:  Dave & Thomas Interview {Guest} on {Topic}.

Oh, and by the way, we probably need to re-run a session where Dave actually interviews Thomas!

See you Thursday at 8 am for session number 2!  If you need a Clubhouse invite, email or message me.

Product Power Breakfast #2: Thomas Interviews Dave

(TLDR — Link to Episode #2, Thursday, April 1st at 8 am pacific.)

Well, we just finished the first episode (“Dave interviews Thomas“) of our Enterprise SaaS Product Power Breakfast series and wow, was it crazy.  In addition to our regularly scheduled interview on product management with Thomas, we had:

  • A guest appearance from the ever-brilliant Jason Lemkin, EchoSign founder, VC, and creator of SaaStr — thanks for coming!
  • A surprise cameo from Dharmesh Shah, cofounder and CTO of HubSpot (who I think Jason pulled up [1]) — thanks for coming!

While it was definitely a romp in terms of structure (or lack thereof), it was high energy, full of great content, and fun.

So, we’re going to try it again next week with Episode #2:  Thomas Interviews Dave. Topics on the agenda include:  product management, product strategy, product positioning, and product roadmaps.

Maybe he can control the room better than I did.  See you there!

# # #

Notes

[1] I was following the “it can’t be that Dharmesh” and the “let celebrities be audience members in peace” principles.

 

Ground Rules for our Clubhouse Product Power Breakfasts

As recently announced, Thomas Otter and I are starting what we hope will be a series of Clubhouse Enterprise SaaS Product Power Breakfasts, Thursdays at 8 AM Pacific time.  The link to the first one is here and the Slido Q&A is here.

In order to keep things flowing smoothly, and in response to my experience on Clubhouse thus far, I started writing a ground rules document for Thomas and me, but decided it could be useful for everyone who joins us — particularly because I’m suspecting many of us are pretty new to Clubhouse.  So here goes.

Moderators

  • Keep the room on topic = enterprise SaaS product.
  • No soliloquies = back and forth makes Clubhouse interesting.
  • Let other moderators talk. (Hint:  we’re all type A.)
  • Answer the question for the room, not just to the person.
  • Answer the question you thought you were asked.  (So audience please make questions clear!)  We want to avoid triple restatements, which are sadly fairly common –> The question is X.  Was your question X?  Yes, my question was X.
  • Go on mute when you’re not speaking (particularly if you see the grey outline flickering; it means you’re picking up noise)
  • Come off mute to indicate that you want to speak
  • Flash mute on and off to “clap” when someone else is speaking
  • By default, avoid what I’ll call Clubhouse Verbose Protocol (e.g., “Hi, this is Dave speaking, the answer to your question is no, this is Dave and I am done speaking.) [1] [2].

Those Moved Up to Stage

  • Ask your question clearly as possible.
  • Do a brief, one-line self introduction (e.g., “my name is Dave, I’m a PM at Zendesk, and my question is …”)
  • Please try to keep questions reasonably brief and of general interest.
  • Don’t be bothered if we put you back to the audience after your question.  We’re just tidy.
  • No self or company promotions please (i.e., please don’t try to use this forum as a way to market your goods or services).

Audience Members

  • Ping people into the room if you’re enjoying the content!
  • Raise your hand to ask a question; we love questions.
  • Use Slido to ask questions as well.  The event code for our first event is 569975.
  • Please fill in your bio so we know who you are.
  • Mute your phone when you’re moved up on stage (bottom right of screen); it’s not muted by default.
  • We’ll try to answer all questions from those we pull up on stage; if we’re near the end of the session, please be sensitive to that as we want to end on time.
  • We reserve the right to promote special guests and bring them up on stage out of order.
  • While we have not (yet perhaps) created a club and ergo have no Club Rules, normal rules of business and social media decorum apply.
  • I’ve had requests to record these sessions and make them available in other media (e.g., podcasts) but have not figured out how to do that yet.  Once we’re not total noobs on Clubhouse, we’ll explore doing so, in accordance with Clubhouse norms.

# # #

Notes

[1] Typically used in my experience in rooms with a large number of moderators and/or people on stage.

[2]  We will do so by request if members of the audience desire it, for any reason, in order to better follow the conversation.  For example, visually challenged people sometimes request this, particularly if all the speakers have similar voices and/or accents.  In our case, Dave has a New York accent (and accompanying pace) muddled by years of living in California.  Thomas has a South African accent, perhaps muddled by years of living in Germany.

A Tip of the Hat to Grid On Their Launch Day

It’s not every day you hear about a startup in Iceland, founded by a guy whose last company was a data marketplace that he sold to Qlik.  And it’s a small world when a friend and fellow board member had independently discovered the same tool and built a SAFE calculator  and an inverted pipeline model using it.  Moreover, I included this tool, Grid, almost tangentially in my next-generation EPM round-up, as it’s not really an EPM tool, but it looked interested anyway and I thought it was worth mentioning.

With all this karma pointing me towards Reykjavik, I sat down for a Zoom call the other day with the guy in question, Hjalmar (pronounced like Hallmark without the k) Gislason, founder and CEO of Grid.  After being impressed with him and the tool, I decided to do a quick post to support their official launch, which is today.

Grid is pretty simple in essence.  It’s not a reinvention of the spreadsheet.  It’s not a replacement for the spreadsheet.  It’s a layer atop spreadsheets, a no-code tool that lets spreadsheet users build interactive web documents using their spreadsheets as data sources and publish them on the web.

Here’s an example of what you can build using it in about two minutes.  Among other things, it gives a whole new look to driver-based planning.

The company raised a $12M series A back in August, led by NEA. Congratulations to Grid on their official launch and best of luck to Hjalmar and the team going forward.