Claire Hughes Johnson: How Stripe's COO approaches company building

welcome to another episode of resources for humans I'm Jack and I'm here today with stripes chief operating officer Claire Clara thank you so much for being here with us today yeah so I want to spend a lot of our time today talking about culture and company management's but can you first tell us just a little bit about your background and how you got here I am batted doing the short version of my background but I I think of my career kind of in a couple of different phases and phase one was the random phase which was in my 20s I did a lot of different things from running political campaigns to working in a foundation to going to business school to working in consulting and then my second phase was Google phase which was of over ten and a half years at Google and a lot of different roles actually which is good preparation for this face which is stripe and doing I don't know we don't like titles much at stripe so I do a lot of the things depends so okay when you first got here what did the company look like compared to how it looks today I mean I think a lot of the fundamentals were here but obviously much smaller we're about eight and a half times the size in just a few years and the concept of management was pretty new when I joined stripe and it's pretty established today I think that's something I've actually worked on what did it our products we're not as complex our user base was not as large and diverse so I think if there's anything that's really a complexity level it's just much higher but the fundamental structures and the DNA and like what we're about is still pretty firm at the core which is important so I guess what is that what are those things that are sort of core and unchanged in sort of your estimation of it I think the most important thing about stripe is I think the people who join us care about infrastructure they care about kind of hard problems and long-term meaningful change so if you talk to people in the company they'll say we're increasing the GDP of the Internet is our mission and I think it's unfortunately become a little bit clichéd and Silicon Valley to talk about like what's your big impact and actually when you look at companies and I got recruited by a bunch of companies I don't think that there's that many companies doing really important work it's probably more than people realize but they're not the ones who are often in the news but stripe is working on building the economic infrastructure for sort of the modern age right if payments have been around for thousands of years and in some ways a lot has not changed and yet the economy and the world and where job creation happens and where ideas come to reality is totally different and yet payments infrastructure lives in sort of geographic boundaries right and so if you think about what existed in the beginning of stripe and exists in why people join the company is because you have a chance to build something that's really unfinished and needed for future businesses to be built in the internet world and speaking of people joining so I know it's been a few years that you've been here now two and a half three years since you joined yeah over three years how did they recruit you and can you give us any insight into what that looked like because you know you see you know when you when you joined I remember reading the headline about it and you know a senior executive from Google join stripe like how did how did they recruit you I think the way the lot of really good recruiting happens which is finding someone that whose advice and friendship frankly I valued who convinced me to meet with the founders I I think you're really fortunate in your career if people are reaching out to you and want to meet you but if you're like me and you had a pretty busy day job and I'm also working mom and I'm pretty careful about how I spend my non work time I it's gonna be hard to get me to take the meeting and so you had have to get somebody I literally said no and my friend said have I ever introduced you someone that was a mistake and I was like darn it no okay fine so I debated and I think but then in suit a very long process that on both sides has to be a really careful process because when you're bringing in new leaders especially when you're pretty early and young as a company they have a massive influence in good you know and that couldn't turn out really well and that can turn out well especially culturally so getting to know sort of are we gonna work well together are we culturally aligned how's it gonna feel to make decisions together and a lot of the time I spent with Patrick and John and then other leaders at stripe and and then eventually with the teams was let's actually jointly do some work together and see if we like it because it was a big decision on both sides so there's the there's the front of the sort of funnel of employees which is recruiting yeah stripe also seems to retain employees for a really long time and you know this is something that people talk about a lot in Silicon Valley you know people leave jobs after one to two years that's super common do you think about employee retention or is it just a byproduct of other work that you do how do you think about employee retention here I think it's more I mean if you're gonna frame it that way I think it's more of a byproduct I once was chatting to someone who worked in a people team at a large company that will remain nameless and they said that they changed their people team's goals to focus on retention and then she said to me it was really alarming to her because she said what am I supposed to do bar the door as people are walking out because she was a member of you know a team that was facilitated but it was not and I said yeah that would be a hard goal to meet on a quarterly basis if if you're the last stop and so you have to think about retention as a by-product and you want to we track it we look at it and we look at and we do exit conversations we want to understand why are people leaving but I don't think actually think if you if you build everything in your program around retaining people you're probably gonna get some things wrong interesting yeah on a somewhat related topic you know the it seems that one of the things that companies try to do to sort of drive down employee turnover is have programs for employees to grow what are like the effective ways to do this and maybe more specifically on that how do you grow employees in a world where not everybody can become a manager so first part on programs from pleased to grow you know there's a so we do an employee engagement survey which i think is a good practice which we started doing when I joined the company and one of my favorite things is there's these two questions and one of them is are you learning and growing at stripe something like that and it scores off the charts and it's court about the charts because look stripe is learning and growing and you're in an environment where everybody is doing something different and new every few months you don't really realize it one week to the next and you look over the last few years you think wow and that's off the charts and then there's there's one that's like about your career development it's like that's okay and I think one career development is awful often a code word for like did I get promoted or am i a manager right and it's not actually am i learning and developing and growing and I kind of want to separate those conversations and I think programs for learning and growing are good but if you are lucky enough to be in the kind of environment that stripe operates in people are getting it all day long and that's more about it was more valuable for my career I was talking to Katelyn on this show who was the head of people at reddit and she said the best way to retain employees and to have him play growth is for the company to be succeeding yeah I mean that's the I mean Eric Schmidt like to say revenue solves all problems but growth well growth can paper over some things but it is certainly from an opportunity in a learning perspective really valuable to be just doing well when we get into the company management section I'm going to ask you about sort of managing growth because I think that's a fascinating topic but one thing you touched on that I wanted to dig into a little bit more was you said stripes not big on titles can you tell me a little bit about the philosophy here at stripe about titles yeah I mean we just had I think that some people at stripe consider that a sacred cow and like we're never going to change our minds but it was actually more of a decision I think some of the best decisions you can make when you're a younger company is to preserve optionality and just say you know is this something we're gonna start introducing now and then live in a world five years from now that we can't really predict what it looks like and yet we've introduced a construct that may or may not evolve with that world and both Patrick and I were in pretty violent agreement so I Patrick halls and the founder co-founder of stripe we're in a pretty violent agreement that like why would we introduce that and it frankly titles everything you do cult-like in organizational decisions has an extra now so and I think that mostly their choices between what are we going to try to optimize for and then what price are we gonna pay for optimizing for that thing and you want to be really clear eyed about well this is important to us so we're gonna optimize for it and we're gonna know that down the line there's this price we're gonna pay and I think that titles is just one of the examples of something that can help you I externally right I mean I think it's also kind of funny though you look at people with titles that they're using externally and you're like you're not really the SVP absolutely of X there's people with a CLO title like you at a three person company right well that's really out there but yeah so there's also credibility authenticity like is this appropriate for the kind of company you are and sometimes it's valuable I actually think not having strict titles is valuable because you can go to a meeting and represent what you happen to be doing that month and yeah I'm the product expert on you know totally on payments and so let's talk about it and you're being authentic but you're not relying on some LinkedIn thing anyway titles get warped and they cause people to have strange behaviors and they're used to keep score and if you're actually growing very quickly you're gonna have the wrong titles but on the wrong people pretty quickly so that was the main reason so speaking of growing really quickly there's there's one concept of titles which is where to put the individual and then there's this other concept of how to organize groups which is more like organizational design yeah so how has the organizational design been changing as you've been growing I mean you said you've grown eight times in the last three years how do you how often do you change the organ design and how do you do that yeah so I think that organizational design I love it I can talk about it forever let's talk about it all right now actually there's only a few organizational designs and so when people think they're doing organizational design you're not really there's only a few so one is are you functionally organized or are you organized in business units and so if you think you're you're not really so when we do we have restructured some things because what happens is you start you have people who are generalists doing a lot and then as your business grows you start to specialize and someone whose job was maybe this big as a generalist is actually this big is a specialist so you have to organize against that right but it's not we're fundamentally so functionally organized and that means we have to matrix in to our businesses so our product areas and growing those product areas and so when we restructure so there's an externality just like of everything which is if you've created a matrix team of accountability you have to mitigate the risk that there isn't enough of a single accountable person which is what a business unit leader might represent right and so you're always like basically making what what trade-off works for you at any given time stripes organizational structures have changed but our fundamental approach has not got it but it might so you guys have you know a structure where you're functionally organized but there's cross is that right yeah so we have parts of our company like really product areas that require a cross-functional team to come together and run the business so as you take on more and more initiatives and stripes product and offering is much broader than it was in the past how do you at your level fight the battle between sort of scope creep of the company almost and lack of focus versus needing to take on more to address a larger market you're I mean the most important thing is to feel like okay we have a lot of opportunities and we are I love the expression your strategy should hurt and like we're actually saying no to things and I think when it's easy another favorite expression of mine is like if after you get past a certain phase as a company it's more likely you'll die of indigestion than starvation and so I think that's what you're getting at which is like how do you keep consuming and running at speed yet you're eating a lot more in that analogy and the answer is really building strong leaders like and empowering and starting to decentralize in my opinion I think you can run an incredibly central model I think Steve Jobs is probably your best example of someone who centralized a lot of decision-making on products and marketing and brain but my view is the most successful model is you have to create more decentralized decision-making authority and understanding of okay what are we all trying to accomplish what are our priorities what did the results look like that we're trying to get to and then who's in charge of it and what I was trying to explain to you on the matrix is you have to be even more careful with the accountability piece because you actually end up with multiple parties accountable for a lot but if they know who they are I think you can pull it off I don't know if you were talking about leaders when you said this but I saw and maybe like a first-round review article you said that the best people are good at what they do passionate about it and they make a big impact basically yeah so we'd all love to have that how do you identify those people in a big organization yeah I wasn't just talk about leaders I think it's just generally true it's a good career advice and if you think of I love Venn diagrams but if you think of like your career and career in a Venn diagram over time what you're seeking is like what am I really good at and self-awareness is number one number two number three goal for anybody know what you're really good at know what you're not as good at the second thing is what do I love doing like I actually I'm really good at raising money but I don't really like it right so I know I can do it but I don't love it so it's like I'm not gonna be you know raising stripes next Ravinder or working for a non-profit and raising money I know I can do it but like what do you love and then where I mean this is I think the third is more of the wild card for some people are very impact driven I'm very impact Riven but other people might be have other motivators and just want to understand what is that motivator but for me the best substitute is we're gonna have the biggest impact by deploying what you're good at and what you love and I think how do you identify people that way I think is a it's a great question I mean this is when I'd loved if you studied some of the eras at GE when they started to do some really thing interesting things in the HR space it was when it's sort of like the beginning of people analytics right is when they looked at the people who are the best interviewers over time by looking at the results from a performance perspective of the people they voted sort of yes to hire on and it became clear that actually there weren't that many great ones and that they should be celebrated first of all for that intuition and that power but if I think my own interviewing so much of it is trying to get at okay what are you good at do you know what you're good at and are you actually motivated and passionate one about joining strife and two about the kind of work that you're gonna be doing at stripe these if you don't get those ingredients right eventually someone gets really demotivated they're in the wrong job Google was also pretty good about looking at who is good at identifying candidates on the way and is that right Google did a ton around people analytics I don't know that we ever really close that loop and that partly is because at Google and stripe a little bit this the hiring committee really made the decision and so you could argue one person's feedback didn't always make the hiring do you prefer managers or hiring committees making decisions I I think it's both it's a combination but I think that the hiring manager should play a pretty big role in facilitating like view the committee as your advisory group and listen to them if they are advising you against but but the decision rests with the manager ultimately I think I mean we have a we having a kind of unwritten rule where if someone wants to block they can gotta so the decision ultimately abreast with a hiring manager unless someone is so opposed that they choose to block and that happens very rarely but actually think it's important yeah because there's a reason you got you took all their time to interview that candidate and if they have a very strong feeling you want to hear it yeah one of the themes to this conversation has been about you know not having strong titles making sure that it's not just leaders that were identifying so stripe clearly has a lot of focus and respect for the individual contributor how do you make that work like how do you allow people to make good decisions at scale throughout the organization one of the things that I actually during our onboarding I i run a session where i talk about how the company is evolving and what we expect from people joining and I talk about how much autonomy they're gonna have and how they should feel pretty empowered but that actually has a lot of responsibility that goes with it and I specifically say you are gonna have a manager your manager is important but they're not with you all day long like what you're doing is your choice with your time and fact you have is driven by your decisions and one I hope you're comfortable in that environment - I hope you are good at giving peers feedback because you're gonna be in working groups and teams where there's again no manager hanging around watching what you're doing and and I think that's it I hope that sets people up to feel comfortable with like yeah I've got abilities here and and I can make a decision and I can force decisions and I don't have to be a manager I mean when we were pretty like anti hierarchy and we're anti hierarchy not in that we don't believe in management structure but that we think the person most qualified to drive a decision should be with the one driving it and I think titles and things like that start to undermine individual knowledge as being sort of a currency of the right kind of power and that's something that we make pretty primary like how do you equip how do you equip everybody then is it radical transparency about information if you have a lot of transparent information yeah like I know you have strong values and operating principles what are the tools that other companies need to sort of deploy in order to do this all right so so the thing that I think is really important is to build a strong organizational system right and systems that scale are flexible actually but they have some core elements or you can use the architecture analogy if you want you have some steel beams they're holding up the whole structure but then what you do around it is gonna change as your needs change for the structure so my general way of thinking about our system is there is one why do we exist as an organization as an entity and we talked a little bit about that increasing the GDP at the internet and then - what are our operating principles or and also our what I call our founding documents right so what our long-term goals and do we all agree on those and then how so that's the what and then the how is the operating principles or the values and we have eight of them and we talk about them a lot and we didn't when the company was younger because everyone kind of just knew them but eventually if you write them and you start talking about them and then if you think of that mission and those principles or values as two anchor tenants on what is like a steel core that should run through your whole company then operating system around it is going to organically change your organization is going to change your structures are going to change who you have around the table is going to change but if you're tilting on that axis you're not going to lose the center of gravity right and I think that things like how you feel about titles or how you like those things might that's why I say they're not a sacred cow we might change some of those things as long as people get this is the way we want to operate together those stripe have any sacred cows would you say like are there things that will for sure never change or just stripe sort of take every year as it comes well I I think that I mean one of the favorite things I do in that session I run is I show an early document of people truly stripes trying to describe stripes culture and it reads a lot like stripe today and so I actually hope some of those things never change and that's what makes it special and different and and yeah quirky I mean every company's like every person I think what like companies are kind of a person ultimately and and and they should have quirks we also really like plants I think we're always going to plants in the office but what are the things what are the things that that more things will change than people realize but there's this um there's this great article I really love reading about sports especially because I think that when you're really in a position where you very it's a binary win or lose right it's it and so I love reading about amazing players and amazing coaches and team environments like how do they create like that amazing will to win especially when they didn't actually have the talent or you take the NBA all-stars who went to the Olympics and they lost right you had all the talent in the world but you didn't have a team so I'm obsessed with this stuff and there's this great article from a million years ago about Bill Parcells and he and it starts with there's this elemental thing about the relationship between coaches and players and a game and and the thing that this coach is looking for is when the center will hold and I think that when you think about great companies it's like all of the things happen that you didn't predict the game I mean maybe the rules change while you're playing the game but mostly like you don't know what's gonna happen on the other side on the external to you piece but you've but a really great company the center holds and the thing that's hard is you can't predict what are those things those decisions you made those elements of your culture that didn't change that are the center and so I think being really intentional and conscious when you are changing your mind about some things that might actually be elemental is the most important thing you can do but you also don't want to be so rigid that you can't recognize that the thing around you is different right and so that's like the art of leadership that is art of everything and I think it's that combination of self-awareness and external market and business sort of awareness right yeah one of the things I've been wanting to ask you about is how do you make the relationship between the CEO and the CEO I was successful I think this is like one of these black boxes in companies where people don't know what the CLO does and how they split relationships you know and responsibilities what advice do you have to other people sort of navigating this relationship I think this is hard to answer because the CEO job is sort of a non job and I proudly say that as a card-carrying member of that Club and it's an on job because I think actually it was pretty critical to stripe at a time when you're scaling up and you don't have leaders for a lot of important functions and you need someone who kind of has enough general business athleticism that they can scale up pieces of your company and are trusted by the founder or the CEO to do so but over time if I'm doing my job well I don't think stripe will need me in the same way and maybe an ingredient to success is to just know that but I also think it's really unique to to the founder and to the company one thing that that I I don't think actually a lot about is it me and the CEO I think more about the leadership team and if there's anything I think we've done pretty intentionally in that maybe I've brought to stripe is we invest a ton in the leadership team relationships understanding each other's work Styles understanding how we're gonna make decisions together who is in charge of what like and and I think that I facilitate a lot of that because we're not gonna operate well if you think of me as a meta like how do we operate the system better that's how I invest but there's a lot of collaboration and I think that comes from the CEO I think where the relationship between a leadership team or CIO and a CEO goes wrong is when there is frankly kind of a lack of confidence or a lack of self-awareness and comfort and saying wow you're really good at this and you should do more of this and you're really great at that can you do more of that and like sharing with one another and dividing up because ultimately we're all humans and we're all flawed but I worry particularly for younger companies and founding teams that they feel so much pressure to know everything and also to do like the classic founder model of like I have all that you know I have this vision and we're all gonna like scale that mountain in this vision and that's actually like really fatally weak real power and real strength comes from vulnerability and it comes from knowing you don't know everything and knowing that there are probably people who are better than you at certain things and then what you're doing as the CEO or founder is like how do I find those people and put them in the right environment so the best of them shows up around me and so that's what we we invest more in but it really starts with frankly Patrick and John are incredibly open we have a very strong like learning oriented culture and it comes from them it's like what do we not know what let's be curious about this let's figure out what other people are doing let's ask for opinions and that is a great foundation to start with don't ever feel like you have to know everything when you think about sort of your functional leaders that you work with is that is that the same relationship where you're almost trying to hire and get yourself out of a job and yeah I am constantly trying to get myself out of a job and I you know Molly Graham of the great give away your Legos talk she did or you can read the article from early in my career I actually think that might have been one of the things that elevated me which is like I was delegated power yeah I was delegating empowering which meant then I had time to do the additional stuff and to do the other thing but it's not like I have superpowers it's because there are other people around me and I think I'm pretty collaborative right so I share the credit it's not it's about being the kind of person that people want to help make the whole better and so yeah I'm constantly trying to get out of the job that was a great answer the I guess the last question I have is to the extent that you're able to tell us like what is the future hold for stripe and you can answer that in whatever way means the most to you or you prefer to talk about but whether it's organizationally product the impact like where where will this company be as time goes on you know I'll talk about my aspiration and I think we have a long way to go but I met with a reporter who was sort of doing a story on stripe and he said that he was having trouble capturing in his article that stripe had some qualities of what he imagined some of the tech companies that got founded like in the 1970s AD which was a real curiosity of a hard problem space that was very infrastructural right like it was like fundamentally how we do this thing should be different in five years in ten years and we're in it for the long haul and it's not going to be easy but it could be incredibly meaningful and what I really believe in the end matters to me and matters to a lot of people at stripe is there's an opportunity access gap in the world where there are people who have ideas and skills maybe it's for new businesses maybe it's for other things but in this case I'm talking about like really new business models that are allowable by the fact that we have the technology we have today yet they don't have the opportunity to realize those things because of where they're based because of who they are and it's like fundamentally wrong and the system is broken like why wouldn't you give a bank account to that person right if you think about it and and so my aspiration is that we're closing the opportunity gap the the economic access in such a way that there are new things that we wouldn't have predicted in the world enabled by stripes infrastructure in some way combined with that amazing entrepreneur or that amazing person and that's super motivating and what I hope it ends up in is a lot of new and different kinds of jobs for people all over the world because if you look at any economic study it's like people having a good job really matters and if we play a small role in that Wow that's infrastructure you want to build awesome will Claire this was this is fascinating thank you so much for taking time to do this thanks I really appreciate it you

Channel: Lattice

Views: 37,845

Rating: 4.9004974 out of 5

Keywords: stripe, COO, company building, Claire hughes johnson, chief operating officer, scaling, management

Id: vIHKzRub7ts

Length: 29min 54sec (1794 seconds)

Published: Tue May 15 2018