How one man scaled THREE multi-billion dollar companies

ServiceNow, Snowflake and Data Domain

Frank Slootman did something very rare. He took THREE companies public through an IPO:

• Started at Data Domain in 2003, IPO in 2007, selling to EMC for $2B in 2009.

• Went on to ServiceNow in 2011, went public a year later, and continued to grow amazingly fast. It reached $10B ARR (no evaluation, REVENUE!) this year, and

  Jason M. Lemkin 🦄
  shares some interesting lessons from it.

• And finally, in 2019 he moved on to Snowflake, which went public in 2020, and at the time of writing worth ~$75B.

And then, in 2022, he wrote the great Amp it UP: Leading for Hypergrowth, where he shares interesting lessons from his journey.

Here are the 7 best lessons in the book:

1. Hire people ahead of their curve

2. Hire drivers, fire passengers

3. Make sure people are excited

4. Have a single priority

5. Set a high pace

6. ALL employees should respond to private messages

7. Get rid of the customer success department

Hire people ahead of their curve

Hire more for aptitude than experience and give people the career opportunity of a lifetime. They will be motivated and driven, with a cannot‐fail attitude. The good ones would grab the opportunity to accelerate their careers with you.

My thoughts

Spot on. I shared my opinion in ‘Hiring ONLY seniors is the worst policy in the software industry’.

Hire drivers, fire passengers

Passengers are people who don't mind simply being carried along by the company's momentum, offering little or no input, and not caring much about the direction chosen by management.

They are often pleasant, attend meetings promptly, and don’t stand out as troublemakers. They avoid taking strong positions at the risk of being wrong about something. Passengers are largely dead weight and can be a threat to your culture and performance.

Drivers, on the other hand, get their satisfaction from making things happen. They feel a strong sense of ownership for their projects and teams and demand high standards from both themselves and others. They exude energy, urgency, ambition, even boldness.

Faced with a challenge, they usually say, “Why not” rather than “That's impossible.” Finding, recruiting, rewarding, and retaining them should be among your top priorities. Recognize them privately and publicly, promote them, and elevate them as an example of what others should aspire to.

That will start waking up those who are merely along for the ride. Celebrate people who own their responsibilities, take and defend clear positions, argue for their preferred strategies, and seek to move the dial.

My thoughts:

I LOVED that analogy, of drivers vs passengers. I think it happens in all organizations, and it takes a good leader to spot and fix it.

Make sure people are excited

Ask yourself a few key questions. When you talk to frontline employees:

• Do they seem energized, or does it feel like everyone is swimming in glue?

• Do people have clarity of purpose and a sense of mission and ownership?

• Do they share the same big dreams of where the organization might be in a few years?

Instead of telling people what I think of a proposal, a product, or a feature, I ask them instead what they think. Were they thrilled with it? Absolutely love it?

Most of the time I would hear, “It's okay,” or “It's not bad.” They would understand from my facial expression that this wasn't the answer I was looking for.

Come back when you are bursting with excitement about whatever you are proposing to the rest of us. We should all be thrilled with what we're doing. So channel your inner Steve Jobs. Aim for insanely great. It's much more energizing!

My thoughts:

This one is not that easy to accomplish, it takes a lot of charisma. It’s also hard to maintain for the long term, and I think being ‘absolutely thrilled’ is a very high expectation. Still, it’s a good place to aim for.

Have a Single Priority

“Priority” should ideally only be used as a singular word. The moment you have many priorities, you actually have none.

My thoughts:

It doesn’t mean to do just one thing, but you should know what’s your team’s goal, above everything else.

Set a Fast Pace

People sometimes ask to get back to me in a week, and I ask, why not tomorrow or the next day? Start compressing cycle times. We can move so much quicker if we just change the mindset. Once the cadence changes, everybody moves quicker, and new energy and urgency will be everywhere. Good performers crave a culture of energy.

Apply pressure. Be impatient. Patience may be a virtue, but in business, it can signal a lack of leadership. Nobody wants to swim in glue or struggle to get things done. Some organizations slow things down by design. Change that—ASAP.

My thoughts:

I agree that people sometimes postpone things just for the sake of it. A fast pace is very energizing, and it connects to the ‘make people excited’ point. I’m not sure how to maintain it for the long term, and without it being interpreted as more working hours.

ALL employees should respond to private messages

We also expect that all attempts to contact another person will be acknowledged promptly and responded to thoughtfully. It is not acceptable to ignore a colleague just because you outrank someone or don't feel like dealing with their concerns.

I have seen people coming from other companies act that way, and we correct such behavior the moment we become aware of it. To set an example, I personally respond to any employee who emails me. It might just be a brief sentence redirecting them to someone else, but they will get a reply.

My thoughts:

This is my favorite tip! I had the experience of my messages being ignored by senior employees, and it sucks. Even a small acknowledgment can be nice.

Get rid of the customer success department

If you have a customer success department, that gives everyone else an incentive to stop worrying about how well our customers are thriving with our products and services. People can become more focused on hitting the narrow goals of their silo rather than the broader and more important goal of customer satisfaction, which ultimately drives customer retention, word-of-mouth, profitability, and the long-term survival of the whole company.

For instance, at ServiceNow, some of the customer success people grew quite dominant in the interaction with customers and coordinated all the resources of the company for the customers’ benefit, including technical support, professional services, and even engineering. This had the effect that other departments sat back, became more passive, and felt less ownership of customer success.

At all three companies, we made our technical support people the organizational owners of customer issues from end to end. While technical support owns customer issues, sales owns the customer relationship. Our business is relationship-oriented, not deal-oriented or transactional.

You will end up with a simpler, less costly, and better-functioning organization.

My thoughts:

I haven’t seen it in practice, but that’s a unique thought. I do agree that such a department can cause ‘everyone else to stop worrying about how well our customers are thriving’ if you are not careful.

Final Words

The Business Leader Daily

shared here a great quote by Slootman:

“If you don't know how to execute, every strategy will fail, even the most promising ones. As one of my former bosses observed: No strategy is better than its execution.”

And slootman definitely knows what he is talking about. A great read, with tons of engaging stories and real-life examples from 2 decades of leading successful companies.

What I enjoyed reading this week

Slootman’s journey made me think about myself as a leader, and how to balance the technical & business part of our jobs. Coincidence or not, I read 3 great articles on the topic in the last week:

1. What the new normal in tech means for engineering managers by

   Gergely Orosz

   Many organizations flatten the hierarchy, and EMs find themselves with a dilemma - go back to development, or be fired.

2. Should you stay technical as an engineering manager? by

   Nicola Ballotta
   
   Great tips for staying technical - it’s not only about code!

3. The worst engineering manager interview I witnessed by

   Alex Ewerlöf

   This article complements Gergely’s one perfectly - it show what happens when EMs are not technical, and the problems it can create.