Leading Leaders

“Hiring is one of things that if you get it right, has massive output. The input is many, many hours, but that output ratio is always a very good one.” 

— Tony Xu, DoorDash Founder/CEO

Building an effective senior leadership team is a marathon, not a sprint. In many ways, the journey is unending. Reaching an IPO requires multiple leadership team iterations. Some executives might excel initially and then plateau, requiring a reshuffle or replacement. Others might decide to pursue opportunities at other companies, while some might not match expectations from the very beginning.

To build an effective team, you will need to master the art of hiring great leaders (covered in pre-read 1) as well as onboarding and managing senior executives, which is covered in this week’s pre-read. We also have included a supplemental section on hiring a Chief Operating Officer (COO) because it is a difficult hire that founders often get wrong. 

I. Onboarding and Managing Senior Executives

Managing your executive team well requires that you:

1. Invest heavily in onboarding executives 
2. Delegate functions to executives and create systems for alignment
3. Evaluate executives and fire quickly when they are not working out

Onboarding Executives

Effective onboarding is critical to enabling new executive success.

Before the executive joins…

• Align with your new executive by defining expectations and objectives for their role. Clearly state what you want, but let the executive create the initial plan themselves. You have hired an executive with more functional expertise than you and you should lean on them to provide direction for how to achieve your goals.
• Spend time giving the executive context on the company, the biggest challenges facing the company, and the challenges specifically within their department. You want the incoming executive to have as much context as possible coming into the role for their first 30, 60, and 90 days.
• To support this process, put together an individualized plan (outlined below) for the executive’s first 30 to 90 days at the company. The plan will dictate 1) who to meet, 2) what resources to read, and 3) outline objectives for the first few months of the relationship. Share the plan with them before they start. 

The first 30-60 days…

• Great executives spend the first 30 to 60 days learning as much as possible about the company, its employees, and its goals. This period allows them to form an informed perspective. If a new executive begins making changes without adequate context or understanding, they may be misusing their old methods in a new environment. The larger the company, the longer this learning process takes.
• During this time, they also will be expected to spend time with key employees and learn the operating system of the company. This includes meeting with direct reports and other key stakeholders not in their function.

Example: 30-60 Day Time Spent

At Gusto: New executives spend their first few several months learning about the company and developing a deep understanding of how it works. Only after that are they allowed to make changes.

At Intercom: Karen Peacock didnʼt have any direct reports for the first few months after joining as COO. She spent time doing hundreds of one-on-ones across the company and answering support tickets to deepen her understanding of their customers.

At GitHub: Nat did 80 one-on-ones and 20 group sessions before taking over as CEO. This produced a converged set of feedback and made a positive impression on employees. He asked three questions:

• Over the next two to three years, what do we need to do to succeed?
• Along the way, what should we not lose as an org?
• Where do we really need change?

After 60 days…

• Only once the executive has a nuanced understanding of the business can they start to devise a plan to make changes.Around day 60, expect your new executive to have a draft plan ready. Take time to provide input and feedback. Focus on aligning on the right set of KPIs to measure their success. This way you and the executive agree on the key metrics that matter.
• From this point onwards, good executives don’t need much hand holding. The onboarding plan will give them the context, report buy-in, and alignment to start building out their function.
• After 90 days, it will be obvious whether they are a fit for the role. We’ll cover what to look for and how to handle this later in the pre-read.

Example: 90 day onboarding plan for a VP of Engineering

Goals

1. Get to know people

• Within 45 days, meet everyone in engineering
• Within 120 days, meet everyone in the company

2. Deeply understand the technical stack

• Frontend
• Backend
• Infra
• Security
• Data / analytics
• Operational aspects, including incidents

3. Deeply understand major technical & product flows

4. Deeply understand existing Engineering interfaces with

• Recruiting
• Sales + Business Development
• Operations
• Support
• Finance
• Legal
• Data
• Design
• Growth + Marketing

5. Deeply understand the business

• Product & technical roadmap
• Finance models
• Sales numbers
• Exec docs
• NPS
• Plan

Weekly Plan‍

Week 1

• Join email lists , TODO lists, slack channels
• 1-1s with 5 new people in Engineering
• 1-1s with rest of exec team
• 1-1s with Recruiting team
• Go over recruiting process & pipeline stats
• Read postmortems from last 6 months
• Write “Working with me doc”
• Go through customer sign-up flow (or any of the high-level product flows) and the related pieces (including design docs)
• Set up builds and deploys from laptop
• Have at least one commit merged / deployed
• Determine recruiting workflow with Head of Recruiting for each Eng team
• Start attending recurring meetings, Exec meeting, Engineering cross-functional (i.e. engineering leaders),
• Project/product meetings, etc.

Week 2

• Learn production topology (1-2 days)
• Embed with Infra team (2-3 days)
• Add a new feature/metric to Looker
• 1-1s with 5 new people in Engineering
• 1-1s with 5 new people outside of Engineering
• Start shadowing phone screenings and on-sites
• Shadow Cofounders 1-1s with engineers
• Get up to speed with roadmaps (product + engineering, business)
• Work with Recruiting on Salary bands and attend recruiting sourcing meetings

Week 3

• Read last 2 quarterly reports and previous board meeting materials
• Read Sales docs
• Read Finance docs
• Understand assumptions and build ups for 2018 financial model
• Week 4
• Draft interviewing framework
• Review and update engineering JDs
• Read SOPs for Ops
• Read ~3 support tickets from each category for the last 2 months

Week 5

• Start participating in interviews
• Embed with core teams and review
• 1-1s with 5 new people in Engineering
• 1-1s with 5 new people outside of Engineering
• Schedule 1-1s with direct reports
• Write 1-month observations

Month 2

• Direct reports handoffs from cofounder
• Review top products we need integration with
• Embed with new product team (2-3 days)
• Finish meeting everyone on engineering
• Continue meeting ~5 new people outside of Engineering per week
• Write Q1 personal goals
• Meet ~5 companies upmarket which are underserved by existing product
• Embed with Support & Operations (1-2 days each)
• Write Engineering Manager Expectations doc
• At least 5 people from my network interviewing at the current company
• Select mentors for Internship program

Month 3

• Finish meeting everyone in the company
• Write 90-day observations
• Draft Q2 goals for Engineering
• Talent review for Engineering
• At least one person from my network joining the company
• Handoff closing process for all engineering hires from Cofounder
• Social event for Engineering

Example: Webflow's 90 Day Onboarding Plan

Top of Mind Priorities

Agenda for 1-1

• Product and Strategy
  • Deeper dive into 3-year strategy
• Product organization
  • Current organizational structure
  • X interim transition
  • Taking ownership of product rituals
• Team
  • [Go through each of leaders]
• Partnerships
  • [Go through partnerships with cross-functional teams]

Important Reading

• Webflow 2.0 Mission and Core Behaviors - cornerstone of culture at Webflow
• 3-year Product Strategy Video
• FY25 planning and OKRs
  • OKR 1: X
  • OKR 2: X
  • OKR 3: X
  • OKR 4: X
  • EPD FY25 Plan
  • Marketing FY25 Plan
  • Sales FY25 Plan
• Watch Bret Victor's "Inventing on Principle", which inspired me [Vlad] to work on Webflow in 2012
• Read "Investing on Principle" - a social contract signed with all investors
• 2023 Board Meeting Notes
  • Q423
  • Q124
  • Q224
  • Q324
• Read latest metrics decks

Important Reading (EPD Specific)

• New EPD Structure
• EPD FY25 Headcount
• EPD Budget

90 Day Plan

Week 1

• Complete Workday tasks
• Meet with People partner to discuss team, strengths, challenges
• Meet with X, your onboarding mentor, to better understand culture
• Start meeting with exec colleagues to discuss how teams collaborate
• Start meeting with Product and Design leaders. Attend Product meetings

Month 1

• Finish general onboarding
• Participate in New Leader Assimilation Process
  • This is mean to highlight key questions, concerns, assumptions held by your team
• Get introduced to key stakeholder groups in Q4 Manager Meeting
• By end of month, schedule a half day working session with Vlad
  • Share a retroactive on first month of learning
  • Co-work on shared/mutual expectations
  • Co-work on high-level goals for product team

Month 2

• Participate in immersive experiences to familiarize yourself with different areas of the company
• Meet with People Partner to discuss bottom's up approach to org design

Month 3

• People Partner will conduct a 360 with your direct reports to give you feedback on progress so far
• Share a draft vision/strategy/plan with Vlad. Bias towards forming a structured plan you believe in vs. jumping into initiatives
• Schedule a focused check-in with Vlad on goals, progress, and expectations
• Share any org change recommendations

Recommended Meetings

• Key Partners (1 hour)
  • CTO
  • COO
  • People Partner
  • Product Operations Manager
  • Co-Founder
  • Chief of Staff
  • EA
• EPD Leaders (1 hour)
  • Co-Founder
  • Director, Product
  • Director, Product x2
  • Director, Product Design
  • Director, Insights
  • Senior Group PM
  • Senior Product Designer
• Partnership (1 hour)
  • SVP Sales
  • Director, Product Marketing
  • CMO
  • Director, Business Operations
  • VP People
  • VP Growth
  • Director, Talent
  • Director, Corporate Development
• Other
  • Long list of other important people

Example: Shishir Mehrotra’s 8 week generalized executive onboarding plan

Here is a helpful template that Shishir Mehrotra (co-founder and CEO of Coda) uses to onboard executives.Similarly, it defines a specific plan and sets expected outcomes for the incoming executive to be successful.

Delegating and Aligning with Executives

One of the best ways to drive company wide alignment is to have an effective leadership team. To have an effective core leadership team, you must  delegate successfully and create systems to drive leadership team alignment.

Delegating Successfully

• Clear decision-making systems: Clear goals and metrics drive effective decision making. Each team must understand how their metrics and inputs ladder up into the overall company goals. It is your job to ensure metrics and timelines are well understood by everyone. CEOs achieve this by highlighting key metrics in all-hands regularly and aligning with leaders in 1-1s and leadership meetings so they share the same narrative with their teams. As your company grows, you will not be able to make every decision; therefore, it's crucial to come up with a process that ensures consistent decision-making.

Examples: Scaling decision making & Functional Audits

Stripe has a written decision making culture. Important discussions at Stripe always require a pre-read. These discussions, along with their corresponding memos and the decisions, are archived on the company's internal wiki for future reference. Stripe holds the view that writing fosters clearer thinking and provides incoming employees with valuable context to make better decisions.

Brex created weekly decision review meetings inspired by Amazon. Teams are expected to write a memo detailing the problem, the trade-offs of each solution, and their recommendation in the meeting. Meeting participants are expected to read the memos prior to the meetings, and add comments.

Square uses the S.P.A.D.E. decision-making framework. S.P.A.D.E is an acronym for Setting (what, when, why), People (who is responsible, who consults, who approves), Alternatives (feasible, diverse options), Decide (private voting and final decision), and Explain (communication and documentation of the decision). For important decisions, teams write a S.P.A.D.E memo. Please reach out to set up office hours with Gokul Rajaram, the author of the link above, to discuss this topic or any product related question.

• Be okay with giving up functions: Giving up product engineering, or any other function that you enjoy can be hard, but you're only getting in the way if youʼre overly involved (e.g., in the room in all the brainstorming meetings). You hired the executive to lead that function and spent time upfront with them onboarding, you have to let them lead. This doesn't mean totally checking out of the function, but it means figuring out systems to audit/check-in on the functional health

• Audit functions: As the company grows, it will become harder to have a complete picture of every function. It is on you to create processes and systems to pulse check and dive deep into all of the functions at a semi regular interval.

Faire uses weekly business reviews to audit functions. Once per week, Max Rhodes, the CEO of Faire, reviews the data with his team. When metrics are not meeting targets or progress is slow, Max asks questions. Team leaders are expected to understand the reasons for missed performance and to propose likely solutions. If a leader is consistently missing targets or sharing bad news, this is a red flag. Additional tactics you can use to audit function health are in the next section.

Intercom used principles to enable easy decision making. Principles are frameworks teams can use to make decisions without you in the room. Whenever the team needed to make a big decision, they would come up with a set of principles for choosing between X and Y. When relevant decisions are made elsewhere, it becomes easy to point people to the principle to guide the decision. As priorities change, principles will also change for the company. Debate and revisit principles regularly. Karen, Ex-CEO, at Intercom found principles to be an effective way to scale your decision making style across the company.

• Example Principle: Drive as much automation as possible -> This led automation investments in products and internal processes
• Example Principle: Intercom is a developer platform -> This led to >300 applications built on top of Intercom

Karen Peacock, ex-CEO at Intercom, on principles and decision making

"Your principles are actually tools that help you make decisions. So a good way to come up with some of your principles. And you don't need to codify your principles for the whole of the business but more like, hey, for this particular decision, if we're deciding our product roadmap, how are we going to figure out what are the next things that we should build? How do we prioritize those? Well, you could come up with a set of principles. One principle might be we focus on the things that are most important for our current target customer, not things that could open up our market and open up new TAM right now. So the principle doesn't have to be true forever. It's more of a decision making criteria. So you could say great, I know that I could build out this feature that would be wildly useful for this other vertical but we're really focused on this first vertical. And our principle is we're going to keep building out the things that are most important to this vertical versus get sidetracked by moving on to the next vertical and building out things that would be valuable there even though I know we could sell more business if we started to open up that plan. So principles are things that are helping you make today's decisions and principles can shift whenever it makes sense for your company. But the most important thing is it enables you to not be in every single meeting."

‍

Aligning with Executives

Create regular touch points to drive alignment. Your executive team will not function well if everyone operates as individuals. As the founder, you must create systems to drive leadership team alignment such as regular leadership meetings and executive offsites.

• Regular leadership meetings: Effective leadership meetings give you an opportunity to set the direction of the company with your executives and work with your executives to solve the company’s most pressing problems. It is important to curate an environment where everyone feels comfortable sharing their function's problems. This prevents the meeting from devolving into a series of status updates where no decisions are made. In addition to leadership meetings, set up meetings with a broader leadership group so you can broadcast what’s on your mind and the company’s goals.

Example: Executive Meeting Structures (Same as Session #1)

Weekly Executive Team Meeting

• Running agenda each week to discuss big company level topics
• Goal is to make sure the executive team stays connected and to discuss big strategic topics
• The output of these meetings is typically decisions on big strategic and hiring topics

Weekly Team Leads Meeting

• Once they scaled past ~80 people this became important. Its a meeting for directors and above
• Max uses this time to broadcast what is top of mind for him and the leadership team at Faire
• The goal is to ensure alignment on key goals. It is impossible to be too repetitive

Weekly Business Review

• Weekly meetings reviewing all key metrics in the business
• If metrics are off, they understand why and how to address missed performance
  

Box maintains an ongoing list of 12–15 strategic subjects. The meeting structure is below:

1. Examine their 12 primary indicators.
2. Analyze the sales pipeline.
3. A rapid-fire session where each participant highlights their most pressing issues.
4. Break for lunch.
5. Focus on 1-2 strategic areas, typically summarized in three slides each.

Weekly Leadership Meeting

One-hour meeting on Tuesday at 1pm. Meeting is structured around a Google Doc where key company metrics are automatically populated each week as a status update. Within the doc, each executive also has a section to answer the following questions:

1. Red/yellow/green on professional and personal things
2. Key focus areas for the week
3. Things youʼre concerned about
4. Things you need help on

People read and comment on the doc for the first 10 minutes. This allows little things to get resolved via the comments. The remaining 50 minutes they discuss key topics that Wade has curated.

Monthly Business Review

• Monthly OKR meeting to track performance versus goals

Weekly Leadership Meeting (from when Apoorva was CEO)

• Apoorva sets the agenda over the weekend. 3-hour meeting on Tuesday
• Team reviews key metrics from prior week on Monday in advance of Tuesday meeting
• Discussion revolves around founder agenda + discussion of outcomes from last week

Broader Senior Team Meeting

• 1 hour meeting on Wednesday. Includes a broader set of senior team members
• Use the time to communicate what was discussed in the weekly executive meeting

Weekly Meeting (Nat Friedman as CEO)

3-hour meeting on Monday. Agenda is the following:

• Discussion of Sunday Snippets. Every Sunday, executives share "Sunday Snippets" on Slack. These are a summary of what they are working and what's on their mind
• Nat shares what is on his mind
• Discussion of predetermined agenda
• In the final hour, they invite others to present. This makes people feel like they are being heard and it is a way to reinforce cultural values you think are important at the company

Examine the KPIs from the past 12 weeks, assessing how each week's figures have evolved year-over-year and how they align with set targets. Everyone is encouraged to raise questions regarding any KPI.

The result of the meeting is a list of actionable steps, either to modify a business aspect or to alter the KPI set if it isn't yielding the necessary data for decision-making.

Rather than using slide presentations, Twitch employs Amazon-inspired written documents that adhere to specific guidelines. For instance, growth rates should always be accompanied by their base values, and any number presented should be contextualized with its year-over-year change and its relation to the goal.

The founder maintains a continuously prioritized list of subjects, organized based on their significance. Prior to the meeting, he shares a concise written overview or vision related to one of these subjects.

While they seldom cover all the topics, the prioritization ensures concentration on the most crucial matters. The founder contemplates two key questions: (1) Is any item on the list crucial enough to halt ongoing tasks? (2) If a topic isn't addressed within the upcoming week, is it even necessary to discuss it?

Example: Executive Offsite Structures

At the start of each quarter, they conduct two-day retreats. For the initial one and a half days, only the CEO and their direct reports participate. The wider management team is incorporated for the latter half of the second day.

They hold an offsite during the first week of the quarter's final month.

The objectives are twofold: (1) to ensure they are on course for the current quarter and (2) to establish targets for the upcoming quarter. They refrain from non-work-related activities, given the existing positive dynamics and enjoyment in their daily operations.

Annual offsite.  Founder doesn’t feel they need to do it more as the team collaborates well.

Annual planning offsite, complemented by afternoon sessions during organization-wide gatherings.

Evaluating Executive Performance 

Because executives are functional experts, it's sometimes hard for founders to evaluate their performance, especially when it's a function the founder has no experience running. There are three simple questions you can ask yourself to evaluate an executive’s performance.

1. Are deliverables and goals being met?
2. Is their team happy and well functioning?
3. Are the people they’ve hired A players?

If the answer to the above three questions is a resounding yes, it is likely that an executive is doing well. Below we outline additional signals you can look for and tactics you can use to evaluate your team’s health.

Signs of Executive Success 

• They are proactive and don’t surprise you. When things are going wrong, they flag information to you and tell you how they are addressing it. The best leaders over communicate and regularly share updates on decisions they have made or they are about to make. Poor leaders surprise you with bad news, good leaders surprise you with good news. In other words, they often exceed your expectations.
• You get energy from working with them. You're excited to work with them to tackle difficult problems. If you find yourself trying to avoid them or are seeking out others over them, they are probably not doing a good job
• They are good communicators and speak simply. The best executives simplify. They take complex problems and create clarity for founders and their teams.
• They are hiring a great bench of leaders and are able to delegate (like you!). The best executives understand that they’ll need a team to scale their function. Once the foundation is set, they dedicate a large chunk of their time to building their team. They attract great people.

Signs an Executive is Struggling

• They're always behind or scrambling. This is usually because they haven’t built a great team or they do not know how to delegate to the team they built. 
• They escalate issues versus solving problems. If you find an executive consistently bringing up issues they should have solved without you, it's a sign they can’t influence their peers or work with other teams to solve problems.
• They get defensive when questioned. Nobody gets everything 100% right and leadership meetings are an opportunity to discuss problems or underperformance. If they get defensive when you question or inquire about a decision it's a bad sign.

Tactics to Assess Functional Health

• Skip-level roundtables. Bring together a group of 10-15 individual contributors (ICs) from a function. Ask each person to say one thing they are happy about and one thing that isn’t working. See if there are consistent themes and look around to see if any points get large reactions from the group.
  • The executive should not be in the meeting, but tell them beforehand you are doing this.
  • After the meeting, you can tell the executive the results of the meeting and deliver feedback. 
  • This is also a scalable way to drive alignment as more of the company has access to the CEO‍
  • Skip-level 1-1s. Try to build relationships with key stakeholders who report to your executives. You can let the executive know what you are doing. In these meetings pay attention to what the executives praise and discourage. You want to make sure the feedback they give aligns with how you want to run the company.

• Lurk in Slack Channels or check on other functions from time to time. At Twitch, Emmett used to get a weekly email of everything being released - he would pick random releases where he would ask questions to the team. This would help him get a pulse check on the health of that specific team.

Providing Feedback to Executives

It is important to provide regular feedback to executives and to fire quickly if you realize it's not working. The more senior someone is at the company, the less candid feedback they receive from employees. Therefore, it is important you create a regular feedback loop for any executive you work with. 

• In the beginning, share feedback multiples a week. Establish the cadence. Be direct and request feedback from them as well. This is a two way working relationship, so it's important that they feel comfortable challenging and sharing feedback with you. Set up 1-1s to create a formal feedback loop.

Examples: 1-1 Template

Create a shared document and cover the below questions each meeting.

• What are they working on to meet the aligned objectives?
• What is going well? What is going poorly?
• What are they working on to fix the things going poorly?
• Feedback you have for them. Feedback they have for you
• Share in-depth feedback twice a year. This helps you keep a track record of feedback shared. This becomes especially important when you need to exit an executive for underperforming.

Firing an Executive

If you let a bad executive stay too long, they usually hire B and C players and demoralize great ICs. This typically results in missed deliverables, and can take years to unwind. Try to fire bad executives quickly – ideally within the first 90 days.

In the first 90 days, watch how the new executive navigates the organization, builds trust, starts to make early changes, motivates their function. If you find yourself wondering whether the person is working out, they probably are not. If this is an established executive and you see any of the signs we laid out above, move to fire that executive quickly. 

Don’t wait for a replacement. This is hard to execute and founders wait too long to fire. ​Reluctance to fire underperforming executives often stems from the time and effort (3-6 months for most executives) invested in hiring them, as well as the daunting prospect of another search for a replacement. However, delaying this decision not only allows the executive to continue underperforming but also creates a larger ripple effect of issues throughout the organization, compounding regrets over time. Trust your instinct and investigate if you start to feel a function begins to underperform.

Pedro Franceschi(CEO of Brex) on holding on to an executive for too long

“I think that people that fail in six months are not the most dangerous ones. The most dangerous ones are the ones that slowly don't succeed. Because it just takes you away from the massive opportunity that is having an amazing player in the role. [The example he is thinking of] was here for two years. It probably took us a year longer and we just made, you know, not the best decision we could have made in the product experience over that time. And I think I got farther removed from the product, which was not something I enjoyed, but at the same time I wanted him to be successful. So I coped with it. And I think I was too apologetic”

Vlad Magdalin(CEO of Webflow) on holding on to an executive for too long

“I wish I had more conviction earlier that something can't be fixed. It's the opportunity cost. That's the killer. Totally agree. Like when somebody doesn't work out within the first six to 12 months, so much easier to recoup your opportunity loss than it is two to three years in. So. To the question of could we have vetted it in the interview process? Maybe if we had the same criteria that I outlined for the [recent] search that you know somebody has to be technical etc. I didn't have that conviction before. I just didn't know what [I wanted]. I kind of was more thinking about, hey, these folks are like experts in their field or in their function in their practice. And you can just see over time, how lacking some of those things that are like more company specific needs, leads to longer term kind of divergence of whether they can be successful in the role or not.”

Once the executive is fired, founders will either 1) run the function themselves or 2) have a strong executive of another function or 2nd in command in that function take over while they search for a replacement.

Tactics for Communicating the Decision

• Be kind on the way out. Thank the executive publicly and be honest about what happened with the company. Work with the executive on the messaging to ensure you are both happy with it. This also becomes a mechanism to show employees that you treat people well, even on the way out.

Example: Sample messaging for an executive that did well, but is not scaling

Startups often grow at a pace that outstrips anyone's ability to keep up. John Leader did an amazing job leading go-to-market the last two years. Because of his work, we’ve grown 3x in the last year. This growth has created new demands and the role now requires a different set of skills.

• Share the messaging with other leaders in your weekly meeting to make sure there is alignment when they get questions from their teams about the change. This lets you guide the narrative internally.

• Own the mistake (if there is one). Commit to doing a better job next time.

II. Hiring a Chief Operating Officer (COO)

Fundamentally, the success of a COO hinges on compatibility with both the founders and the role itself. As Lexi Reese, former COO of Gusto, puts it, "It’s all about deeply understanding what the CEO needs that the COO is good at and being ready to give something up to get something much bigger." This means the COO for your company will be specific to your needs and the founding team’s strengths and weaknesses. 

When to Hire a COO

The COO is a complicated hire and it's different for every company. When you have strong product-market fit, have established initial GTM foundations, and need to scale processes and functions 10x, it's time to consider a COO. Consider is the operative word. You can often succeed with hiring functional executives first to solve your specific problems or a do-it-all Head of Business Operations before hiring a COO. In the case of Stripe and Gusto, the founding teams optimized for their biggest challenge first. They also hired leaders that were not only willing to scale down and up to get the initial job done, but also had enough experience to expand their roles over time if things worked out.

We also often see COOs promoted from within. This happens because internal promotes have context on the company and have internal respect enabling them to lead large portions of the organization. Brex and Faire are two examples of companies where early employees eventually became the COO.

Examples: Successful COOs

• Hired Lexi Reese at 100 employees, $10M in revenue, 10,000 customers. Left at 1,400 employees.
• Lexi was previously at Google where she was VP of Programmatic Advertising
• Lexi joined as Head of Customer Experience and moved into the COO role within 1-year
• She owned customer experience, sales, marketing, business development, and insights & operations
• Founders needed an exec to build a machine to “serve and acquire” 100s of thousands of SMBs
• Founders needed an exec that could hire a team of hundreds of people to serve and acquire users
• Hired Lexi because she could build large GTM motions and solve the initial problem
• There was an expectation that she would grow to own large portions of the company over time

• Hired Claire Hughes Johnson in 2014 at 160 employees. They started talking at 70 employees
• Claire was previously at Google where she led Online Sales and the Self-Driving Car initiative
• Joined as Chief of Business Operations and moved into the COO role six months after joining
• Founders didn’t know if they needed a Chief Operating Officer or a Head of Sales initially
• They used conversations with people like Claire to clarify the mission, outcomes, competencies
• Founders needed an exec that could build out customer ops, sales, and design processes for scale
• Hired Claire because she had experience scaling large teams and growing a sales organization
• There was an expectation that she would grow to become the COO over time and could own large swaths of the organization

• Michael Tannenbaum was the first employee outside of Pedro and Henrique
• His initial role was Chief Financial Officer (CFO), but he helped build multiple teams at Brex
• He became COO in 2021 where he leads finance and operations at the company
• He had day 1 context and already led many of these functions at Brex well

Interviewing a COO

Be prepared to spend significant time getting to know the COO candidate to ensure a good fit. Remember that the hiring process is about building a genuine relationship with the candidate, much like choosing a life partner. When you’re interviewing a COO, you will spend at least 15+ hours together to determine whether there is a mutual fit.

Characteristics of a COO

• They’ve seen scale: In their previous roles, Lexi and Claire hired and managed large teams, designed processes for scale, and had expertise in the functional areas that needed the most attention (i.e., GTM and Customer Operations).

• They are willing to do the work and hire the teams: The initial COO will need to wear many different hats and in some cases do the work themselves. They need to have the humility to scale down in the first stages of joining a company before they build the systems for scale.

Claire Hughes Johnson, ex-COO at Stripe on being willing to do the work (originally from her book Scaling People)

“My initial role at Stripe demanded a lot of range. In addition to responsibilities across sales and operations, I was also the head of recruiting, the recruiting team manager, and a recruiter myself. Then, in time, I was the COO, with a head of people who had a head of recruiting reporting to her. Whomever you hire will have to have that ability to move up and down the “stack”, or you’ll need to wait until you’ve reached a certain scale to land the right person and position them well for impact.” 

• They can challenge you respectfully: A great COO will be a partner to you. This person needs to be able to convince you of different strategies or approaches. They also need to be willing to listen and not blindly replicate what worked for them before.

Lexi Reese, ex-COO at Gusto, on challenging each other

“Josh makes decisions from “first principles.” I say that in quotes because it means—it’s too Silicon Valley-y, but he breaks things down to their essence and then builds them up again. Whereas I may do that—and hopefully do, I think I do—but can also make decisions differently based on having seen the pattern several times. I’ve seen that issue. We need SDRs. And he’s like, “But why do we need SDRs? What is the reason that we need SDRs?” So on our worst days I’m like, “Fucking A. Just go faster. Let’s just do this!” And he really wants to understand it. On our best days I’m like, “You know what? That’s a good point. You should challenge my thinking on why we need this function or this thing?”

Tactics for Interviewing COOs

• Give them a real problem you’re working on and ask them to come prepared. Pick an issue that you care deeply about that you know will be hard to change your mind on. See if they can engage with you on this topic. They need to be able to engage in healthy debate and be capable of challenging you. If they are unable to do this well, they likely won’t be capable of doing the job.

• Ask them to come up with their 90 day plan and discuss it together. This is a great way to test how they think, how compatible they’ll be with you, and how well they understand the business. You can use the plan to talk about problems you're facing and get their feedback and initial insights. This also becomes a great way to align with them on the role before hiring them. See examples of 90 day plans above in the pre-read. 

Examples: Example Interview Process

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• Josh and Lexi spent 19 hours together throughout the process. While there were various interviews with Gusto team members, Josh and Lexi’s 19 hours were spent discussing:
  • Personal and work values to see if their was alignment
  • Motivations for working on a product serving small and medium businesses
  • Debating various Gusto problems (particularly in CX) that Lexi could solve
  • Family. Josh even met and was interviewed by Lexi’s kids :)
• This ultimately gave Josh and Lexi the context and comfort they needed to work together initially

• Claire met Patrick in February 2014 and joined the company in October 2014
• After their initial meeting, Patrick invited Claire to spend time at their office several days per week
• Claire and the founders developed an understanding of what it would be like to work together
• Collectively, they spent 40+ hours together. During this time they:
  • Brainstormed goals and strategy
  • Prepared for a board meeting together
  • Discussed tactical challenges facing Stripe
• This gave the founders enough context to know what it would be like to work together
• This gave Claire enough context to assess the risk of joining an early stage startup