Brian Halligan: Building HubSpot into a Multi-Billion Dollar Company

0:00 If I put ten calories and try to improve a feature I get like a thousand now. And so I more paid attention to the features and tried to get better at the features and this took me a while to figure this out and over time just tried to hire people around mine. Weaknesses. And I have plenty of them.

0:16 I really looked at hiring the best I could in the areas where I was weak. Rather than trying to become an expert at it. And I'll give you one area. Yeah, for years I was convinced I was a great product designer. I'm not. I I just don't have that genetic code. I've actually quite bad at it.

0:31 It took a while before That feedback sort of hit me between the eyes and we started hiring people really good at it and Enabling me to let go of it. Welcome to the Knowledge Project. I'm your host, Shane Parrish. In a world where knowledge is power, this podcast is your toolkit for mastering the best of what other people have already figured out.

0:57 If you're listening to this, it means you're not a supporting member. Members get early access to episodes. My personal reflections at the end of episodes, which a lot of people say is quickly becoming their favorite part. No ads, exclusive content, hand edited transcripts, and so much more. Check out the link in the show notes for more information. My guest today is Brian Halligan. Brian reshaped the way that we think about marketing, sales, and customer service. With his co-founding of HubSpot in 2006, he pioneered the concept of inbound marketing.

1:29 Emphasizing the importance of creating valuable content to attract customers naturally. Under his leadership, HubSpot has grown from a startup to a publicly traded company and a global leader in the industry. empowering millions of businesses to grow better. I first met Brian at a Sequoia conference where we both spoke. In the conversation we talk about

1:50 the phases of a CEO from startup to IPO and how the skills change, why interviews are a terrible predictor. of on the job success and what you can do about it, why hiring panels are flawed. What changed after his near death experience? Why Jerry Garcia from The Grateful Dead is one of the most underrated CEOs. And what you can learn from him. Why consensus is the enemy of scale.

2:15 why you need to have winners and losers, what he learned from Steve Jobs, and of course the future of inbound marketing. It's time. To listen. and learn.

2:36 Brian, I wanna start with the role of a CEO and the journey from startup to scale up to public company. It's a remarkable journey. And I was on that journey for about seventeen years and a couple of years ago

2:52 Mm. I step out of that journey, Shane. In a relatively dramatic way. And you may have heard the story before. I was snowmobiling up in Vermont.

3:04 I was taking a snowmobile from Rangewater Vermont to Woodstock Vermont coming to the Harry part of the trail. And went up over a lip.

3:16 And one Down on the other side and just Completed gravity went straight down. Up a clip. And smash at the bottom.

3:27 The stonewide was in about a million little pieces. I was passed out for a long time. And then I woke up. It was about Or in the afternoon. Yeah.

3:39 quite cold and nobody knew where I was. Confident I was gonna die. And I sat there for a good hour. Thinking about, you know, if I do make it through, then what? Um

3:51 And I never bring my phone. When I saw milk,'cause in Vermont there's no signal. The whole darn state there's no signal. But an hour in, I'm like maybe I'm out of it turns out I brought it like a moron. And I checked it and dialed nine one one. Shane, have you ever dialed nine one one? I have, yeah.

4:09 It's an amazing service. If if if that was a startup I would be Thrilled to invest in it. It's amazing. Yeah. The the woman was sort of very Very good.

4:19 And she said I remember she said sit tight and Mind you, I have I'm a mess. Many, many, many broken bones. And so it's like junk with Yeah, I'm not going anywhere. And then she called the two local fire stations.

4:34 And they're volunteer and there's no one there. And so then she has to track down the mobile phone numbers of all the firefighters and the the rescue people. Awesome at home. They hop in their stillmobiles and they come and find me. By the time they found me You know, it's pitch bike, it's really cold out.

4:49 And They said they went to work on me and kinda put Humpty Dumpty kind of back together on the side of the mountain, towed me to a flat area which is a few miles away. Helicoptered me to Dartmouth University. In there they really put Humpty Dumpt back together over

5:06 Lots of surgeries a lot of time. And uh I remember that because that was the end of my CEO journey. I had been quietly saying to myself But I didn't love being CEO of UpSpot. With just the core work. And I remember saying to myself at the bottom of that

5:28 Well yeah. I make it out, I'm not coming back. And so I was out of work. A terrific woman took over for me. I have a funny story about that while I was gone. And as I got back on my feet, everyone just assumed I was coming back. Like no no, I'm not coming back. You're doing a great job.

5:44 You got this. And I actually think a lot of CEOs would be a lot happier if they did something similar. Like that. No, it's the part. I assumed, yeah.

5:54 What went through your head when you you sort of couldn't move, you're stuck in the snow. And and you couldn't contact anybody. Like what what are the thoughts that were going through your mind? I'm not super comfortable telling everyone all my thoughts on this, but a lot of thoughts around if I make it out of this somehow.

6:12 Someone finds me randomly. Um What's gonna change. But then I mean the net net of all of them is Wife can be very short.

6:23 Very short. You never know what will happen. And don't waste it. Don't waste time doing something That doesn't make sense for you. You know, refactor your life. And I refactored my personal life and I refactored my professional life pretty dramatically.

6:40 And these days I really don't do anything I want to do. And I wanted to do this podcast. It's a really good podcast. No. Tell me about what the changes were. Like were they all at once? Were they slow? Like w Be specific about sort of

6:57 I I always wonder this'cause I I had a A near death experience to you a couple years ago. And I remember pondering life and thinking about Oh man, if this is the end, like did I spend the time the way that I wanted to? And if it's not the end, like What is it that I really want to change in life and and

7:16 What impact will that have? And I've done such a better job of sort of taking care of my body and my mind and sort of Self care, if you will, just as a big word to encapsulate that. I changed a lot of relationships in my life. I sort of invest in some and then uh I wouldn't say broke off some, but definitely stopped investing in some.

7:37 And so I'd love to hear about the specific things that you you did that you sort of were like, Okay, well this is this is the realization. It's exactly like that. Uh when I say refactor relationships, I triple down on Family relationships. I wouldn't say ended relationships, but I certain people that didn't give me energy in certain ways and just stopped engaging with

8:01 And it's a much smaller group I engage with these days. Uh, professionally, I stopped my main job. I mean I founded Hubspot seventeen years earlier. It was kinda my life and everything was sort of wrapped up in it. And now chairperson, so I'm still mall, but uh not in the day to day. I got obsessed with Maybe similar to you with longevity.

8:23 Like, well, if I'm gonna live to eighty five ninety, I wanna be very strong living to eighty five ninety. So Basically anything Peter Atiya or Andrew Huberman said to do, I did. Except they drink a little. Um, but I basically do everything they do, lost a lot of weight, got much better shape. And so lots and lots and lots of changes, but I think the macro one was just Love your family, tell your mom you love her, hug your kids one more time today, and don't waste time. you know, do things that really are rewarding to you.

8:55 One of the big things for me was like just being home for the kids every day after school. I just made a commitment I was like, I'm gonna be here every day when they get home. Uh, I'm not gonna push it at the office a little longer. Uh, I'll find other ways to do that because I'm also sort of balancing ambition and all this other stuff. uh but it wasn't gonna come at the expense of the time with them that I know Inevitably I'll look back on and be like, Man, I just wish for, you know, a little bit more cookies and milk.

9:20 And they say the dying wish of every man and they just want another day. And they think about that a lot, like what am I going to wish I had done at the end of that? So sheen, while we're on this Why don't you tell us what happened to you? I didn't know for a long time what was happening to me. I just had symptoms and they kept getting worse and worse and worse.

9:38 And so like I I had a fever, then I had an earache. And this was during COVID. So everybody thought it was COVID. So I went to the doctor and they were like, Oh, you don't have an ear infection, you're fine. You don't have COVID. Go home. uh suck it up. And then I woke up on a Saturday And I I remember just making a latte and then I was drinking it.

9:57 And it spilled down my chest. No cat. And I was like what the heck? I've been drinking out of cups since I was like two. You know, rarely do I spill something. And I I went and I I went to the bathroom and I looked in the mirror. And

10:13 the the left side of my face was one hundred percent paralyzed. Yeah. And so I had no movement whatsoever. I felt like I was moving things. But like if I raise my Eyebrows like you can see now on YouTube. If I raise my eyebrows.

10:26 This side it was actually kinda beautiful in hindsight. It was freaky when it was happening. Um'cause this and it just didn't move and I was like, Oh God, like I gotta go to the doctor. My first thought was actually not to go to the hospital, which is a little weird. Uh so I show up at my former family doctor's office. on the weekend and they're like, You you need an appointment, it's Saturday.

10:47 And I was like, Well, I can't move my face, so I think that qualifies as like Maybe I get an appointment today. And she's like, Oh my God, yes, you see the doctor right away. I go into the doctor And she's like, I think you're having a heart attack. And I was like, Well, this doesn't make a ton of sense, right? Like

11:04 Maybe Uh I don't think that's the case. However, you're the doctor. I don't know what I'm talking about. And she's like, You need to drive to the hospital. It's like, Well, if you think I'm having a heart attack, why are you telling me to drive to the hospital? Yeah. It's like these two things don't align.

11:19 Anyway, I go to the hospital, I see a doctor right away. I mean For all of the knocks on Canada's healthcare system, uh, there's certain things and triage that they They definitely see you. I saw a doctor probably within three minutes of getting to the hospital. And uh, you know, he's like, You're not having a heart attack. I was like, Thanks. And then it's like go sit and wait for like twelve hours. Well, we handle all the other urgent people, which is fine.

11:40 And so he sees me and he's like, I'm gonna give you some pregnisone. And you'll be fine. And I remember going like, wait, what? Like you're just gonna give me some steroids and like send me home. Like nobody cares about how this happened. I'm a healthy at the time forty two year old male.

11:55 I'm not overweight. You know, I don't smoke. I don't excessively drink. I have nothing that would sort of indicate this. When I was in the waiting room for the twelve hours, I started talking to a whole bunch of neurologist friends. And they were like, You should get tested for these four things and it was like Uh H I V, Lyme disease mono and uh something else.

12:15 And I was like, can I just get a requisition to get tested for this? And he's like, No, it's just like a waste of the medical system. And I was like, Wait, what? Like that doesn't make sense. He's like, Go talk to your family doctor, uh, they'll they'll figure that out. I gotta go help out their patients. At this point. Well, it's still paralyzed, right? So he's like, You're gonna recover. He's like, You have a ninety-nine point eight percent chance of recovery. And I'm like, I'm not worried about recovery, I'm worried about what caused this. Right, like before we figure out Uh the future, we have to figure out like what

12:45 Am I doing something I need to stop? And I went to my doctor on Monday and I was like, Hey, can I get a requisition for these blood tests? Which in In the States, you just show up and do it. And in some provinces in Canada, you could just show up and do it too. But in Ontario where I live, Uh, they won't allow you to do that. You need a requisition.

13:03 Anyways. She says no for whatever reason. She's like if the ER doctor thought you needed it He would have given it to you. You know, please Please fuck off politely is is sort of what she said. And I was like, Well, this is so weird. And I'm like thinking about this and then

13:17 I wake up a few days later and I can't stand. Oh man. So the backs of my knees, like if I'm moving, I'm fine, but if I stand still for like ten seconds, I'm literally crying. There's tears coming out of my face. I've never been in so much pain. It's like somebody stabbed the back of my legs with a knife. And I was like, Wow, this is like so crazy and up like emailing my doctor again, I'm like I really think uh

13:39 I should get tested for a whole bunch of stuff at this point. Like I don't know what's happening. And she's like slow knowing me. She's like, it'll get better, just give it some time. And then Like three or four days later I wake up and I can't open my mouth. Yeah. uh like I have a lock jaw basically. I can open it like a centimeter

13:55 And Luckily, to cut a long story short, I end up talking to a close friend of mine who happens to be an eye surgeon, she's like, I'll give you the requisitions. Uh she gives me the requisitions. I test positive for Lyme disease.

14:10 I start the treatment for Lyme disease because when you test positive you can actually uh you can fix it. And so I start taking I think it's Doxy Cycling. uh the antibiotic, which is the treatment for that, and instant improvement. The cool part of this is I saw a neurologist in Ottawa. Who tested me for like two hundred different things. Uh, you know, I went down to give blood and the lady's like, This is the maximum amount of blood we're allowed to take out of you.

14:33 I was like, Oh, this does not sound really good. And Uh, I I came back completely normal aside from the Lyme disease. So I'm glad we caught it. Glad we solved it. You know, made a made a lot of changes after that. I I wanna go back to to you and HubSpot though. So like you

14:50 been on this journey for a long time from start up all the way to scale up to now public company sort of chairman. Walk me through the different phases a CEO goes through. I personally break them up like two to twenty employees. Twenty to two hundred. Two hundred to two thousand and then two thousand. Plus.

15:12 And I kinda grate myself in these seasons like I give myself a B in two to twenty, like Two to twenty, I was doing customer development. I was the lead user of the product. I was marketing it. But I'm a crappy coder. Um, and so the heavy lifting was really done by my co founder.

15:30 Twenty to two hundred. I was kind of in my element. I loved it. I was an A. Two hundred to two thousand, maybe at B. And then two thousand to eight thousand. Maybe a D. I really didn't like the work.

15:44 Uh and I think that's the case with a lot of CEOs and a lot of executives and a lot of people like um People have a season that they enjoy and they get good at it. I think that's Very much the case for me. Which was the one where you felt like you had to grow the most to fulfill the role. Really through the whole thing?

16:02 Yeah. I felt underqualified to do it. And I don't know about you, but I still have imposter syndrome here on the podcast. And

16:13 I had it throughout. I think one of my superpowers actually is I'm a learner and I try to get better and I listen to other people And I take feedback. Pretty well. And we had a mechanism that was quite good for giving me feedback.

16:27 Really good, actually. My co founder was responsible for my annual fix three review. He's super introverted, so he didn't want to go around and talk to other people. So he sent a net promoter survey out to The board, the exec, customers, whole bunch of people, thirty different people. He got a lot of responses, maybe twenty five responses. And there were two questions, Shane. One wise.

16:47 On a scale of one to ten. How likely do we refer Brian as CEO of HubSpot? And two Why did you give that answer? And people wrote nov like novels. About it.

16:59 And it's hard for CEOs to get feedback. Very hard. Very few people give straight feedback to the CEO. So this was a good way to get The N was big enough that people give very, very strong feedback. And he summarized it, gave me my net commercial score. And then I start reading my review. And

17:18 Each page was different. So the first several pages were my features and ESOper development. It's like here's your features. So page number one. You're very good at explaining HubSpot's vision. And then he pulled out quotes from the novels people wrote. Page two. Page one through ten were features. And they were great. And I was pretty confident

17:38 That I was the best CEO ever invented after reading the version. And then the bugs came. Page eleven was the bugs. And there were twelve pages of bugs. And I was pretty convinced I was the worst CEO ever invented by the end of the twelve pages. And I Remember when he finished it. I'm not a Scotch drinker, so remember I poured a glass of Scotch. Sh ha ha

17:58 But it that mechanism for getting feedback was We still use it, so the current CEO gets the same type of a thing and it's very, very, very useful. I think founder CEOs often have this problem. It like Founder CEOs like to make decisions, like to be involved with the details, like to drive things, like to be in the middle of things.

18:20 And that's a great strength when you've got ten people. But that great strength you have turns into your greatest weakness when you have a thousand people. You're trying to manage everything, trying to manage everyone, everything that's going on. And so the consistent feedback was like, How do you get yourself out of the details? How do you stop working in the business? How do you start working on the business? That was kind of a common thread. That I worked on across all 17 years. Was that feedback enough for you to walk away going like, Okay, I see this, people are giving me feedback, I accept it, there's some truth to this.

18:51 Or was there a part of you that was like, No. They're wrong. It was pretty it was pretty accurate. And I'm shaking my head through most of it. In the software business, sometimes there's something that someone thinks is a bug. But is it featured as somebody else?

19:07 No. So some of my bugs I actually thought were features. Um like I can be really passionate about something. And Brian gets so passionate, it's like a little scary sometimes. I'm like Fine. If if like two out of thirty of you think that and the rest think it's a good thing.

19:23 I can live with that. So there were several things that I was like That's a bug that I can live with. And Every year I try to work on one or two about the bugs. If I put ten calories and try to improve a feature

19:34 I get like a thousand out. And so I more paid attention to the features and tried to get better at the features and this took me a while to figure this out and over time just tried to hire people around mine. weaknesses. And I have plenty of them. I really looked at hiring the best I could in the areas where I was weak. Rather than trying to become an expert at it. And I'll give you one area.

19:55 Where I need a mistake on this. In the early days of hotspot. I fashion myself like a great product designer. I don't know why I did. I think Basically because

20:05 I followed Steve Jobs, everything he did, read every book. About it. Watch his keynotes a success for them as CDOs are my era. And I was like, I can do that. I c I can figure it out. I took classes and I really dug in. Yeah, for years I was convinced I was a great product designer.

20:22 I'm not. I I just don't have that genetic code. I've actually quite bad at it. Um and it it took a while before That feedback sort of hit me between the eyes and we started hiring people really good at it and Enabling me to let go of it.

20:37 What are some of the lessons you took away from your sort of studying of Steve Jobs, if you will? That you used Effectively. Things on the interwebs.

20:49 It's his keynote and his uh commencement speech at Stanford, I think it's quite good. And once a while I'll look back at that. He was faced with cancer. And the way he approached that was really interesting. And he says it in a different way, but

21:03 He didn't waste any time, that's for sure. And then HubSpot a lot is based on his work. We started the company out of Sloan. Uh while we're business school. And it's Sloan they did field trips, and we did a field trip to the West Coast.

21:16 And I remember this one day was a really good day in the morning we visited Apple. It was like a year after the iPod came out and it was On fire. And I remember Steve walked into the auditorium was about a hundred of us. And he was in a bad mood. Uh

21:31 And it was pretty intimidating. And I remember he looked he looked out and he basically was like, What are you people doing here for business school? Like he wasn't into the whole business school thing. And one of my classmates, JP Gorsky. raised his hand up high and he said, We're here from Song School of Management and we're studying Innovation, disruption.

21:49 And we thought we'd learn from the best. And it just Steve just melted. He liked that a lot. And then he talked about How would you up the iPod? And kernels of this very much made it into the way we thought about HubSpot. And the iPod we described was really simple. Or M B three players before.

22:05 But you had to be a real geek to use one. And very few people were buying them and you had to burn music to them. It's a pain in the neck to do it. And he said, I really wanted something simple. So I want to take an MP three player. Build a premium app iTunes. And then work with the record companies enable you to download a song for ninety nine cents a song. And he said

22:25 That's a one plus one plus one equals ten. But the consumer. And that was how we originally came up with HubSpot, like a marketer in that day and age. I mean Google Analytics and a blog, social media tracking tools and SEO tools, marketing automation. See you and all this stuff. And it was complicated, it was big hairy problem.

22:44 And so we use that analogy very much to see you're like How do we make an all one system? Where the one plus one plus one will equal ten across all. So the morning was really important. And then that afternoon.

22:56 And we're kids. We're in business school. We visited a little startup called Salesforce dot com. And their CEO, Mark Benny. And so the that day was really formative in thinking about spot. Oh, that's crazy. Had you guys just taken your tuition and invest in both of those companies. I know.

23:13 That's crazy. How did you learn how to hire and fire people? Like How do you know you have the right fit? How do you know when It's time to move on from somebody You know, I think about that as somebody who went from school to a large corporation and they have all these policies and procedures in place and then

23:34 Now as an entrepreneur, I'm dealing with CEOs all the time. We've never really hired and fired and Uh I'm curious as to what wisdom you can sort of pass on to people. Most of you, including myself, are quite bad at this. Uh And

23:51 I've identified some things that may be useful hacks may not be useful hacks. This is also a season thing. If you're hiring someone when you're two hundred employees, I see the mistake everyone makes and we made the mistake over and over and over and over and over again. That if you're hiring someone that that you want to go from two to two thousand You're just really attracted by that person who came from Google or Microsoft or whatever huge company with a huge resume and all that stuff. And once in a blue moon that'll work, but generally that's a failure condition. If you hire the press release higher

24:26 That's it. Couple phases over you. I don't think it normally works. Same thing for board members. My analogy for being a CEO is like you're an ice climber going up the ice. It's treacherous. And you can easily slip.

24:40 And what you're looking for are executive members Who have been up that same sheet of ice, but in the last three or four years. What you don't want is somebody who's Twenty years over you. Where someone who spent their whole career on top of the hill looking down on the ice climbers. You want somebody just A little bit ahead of you on that ice climbing condition.

24:59 But that's one thing I think people get wrong. I also think I think most people are bad interviewers. Including myself, like I've missed a bunch. And I think the core reason for that

25:12 Actually isn't the interview, it's interviewees. Interviewees are so good in interviewing. You're in interviewing a VP or a C level person for company like HubSpot. They're good at interviewing and if they're not They've been coached, they've looked on YouTube like I just think everyone, including myself, overvalues their ability to select talent in the interview.

25:36 Process. I see that as uh Overconfidence. I think also like I see it with the CEOs I work with. And I see it as companies get bigger, like you've got a panel of four people evaluating Shane as a potential VP.

25:52 If all four people like Sheen. versus two people love sheen and two people were like, ah, I'm not sure about Sheen. You almost always go with the person with the least amount of weaknesses and that lowest common denominator higher. I think that's a failure conditions. We've noticed that over time.

26:08 I'll take Two loves and two mez over three. Like uh I think that's a best practice that people should be doing. And I think people should be obsessed with reference checking. Um yeah, calling the references, getting good at that, getting good at

26:23 Finding people in your network. I would guess I coach tons of CEOs. On average for every director, VP, C level person that's hired within eighteen, they're gone. How do you know when it's time to move on from somebody where you I guess in a way you've either made the write or it's the wrong environment for that person to succeed, or however you want to phrase that, but how do you recognize that? I I had a CEO the other day tell me he's like the moment you start thinking about it.

26:51 That's the moment to act on it. I've never seen anybody change their mind from that initial thought. How how do you think about that and what's your reaction to that? Unfortunately that's I feel like that's conventional wisdom and I think it's largely quits with what I've seen. I rarely change my mind on people in that kind of

27:10 Contacts. And everyone says when you know you should move quickly. I never have. Call me weak. Um

27:20 Have you ever regretted not moving quickly? It's sort of interesting to contrast that to sort of like Jensen who's been talking recently about You know, he doesn't really fire people, he sort of like berates them into being better uh in a in a public way. B rate is probably the wrong word, but he he sort of

27:36 Wants to pull you towards excellence rather than Uh fire you but I I don't think that's practical for most people or most organizations. So you and I both sat through the same Jensen uh presentation. Yeah. So we spent a lot of time thinking about CEOism and Coaching Cs. And

27:53 There's sort of like a set of best practices for being a CEO. It's almost like a CEO unofficial school. What's confusing about the CEO school that's been around for a long time Is Arguably the two I'm not gonna say best, but two amazing CEOs R Jensen at NVIDIA.

28:13 In Elon, it's basics and that's up. And B completely ignored almost everything about CEO school, CEO lessons, CEO best practices.

28:27 And I find that fascinating. Talk to me about that, right? Where Maybe there is no model. We hold up this model, we teach it, it's easy to do. uh we say the right things, but it in reality the people that end up changing the worlds are often the opposite of all of the points that we teach. Berkshire Hathaway, for example.

28:46 If you looked at their board of directors, I don't think they pass any of the the sort of like standards that business schools would set for what a an independent board looks like. And constellation software is another example of that. So it's Shopify. All all these companies that have sort of done these remarkable things, they don't look anything like what we're taught in business school. When Humpshot was maybe like Fifty employees, Shane. I joined the CEO group.

29:11 And I largely joined the group because I respected one of the COs a guy named Colin Engall. A callin made the room of vacuum cleaners at iRobot. And I I my would describe my relationship with him in two words. Man crush. I really was a fan of all. And I remember this first CEO group we met all day. Once a quarter.

29:33 And I've there's a couple funny things about the the CEO group. Um But I joined. I just remember spending some time with these ten CEOs. In two We're kind of

29:44 They're quirky is the way I would describe them, they're very unique personalities. And the other were like central casting. Blue blazer. And pants like really central casting. uh backgrounds and everything and they acted what I thought CEOs were supposed to act like and I kinda acted like that back then. And when I looked at the numbers, we all showed each other your numbers, the two quirky founders CEOs were crushing it and the eight central castings were whipping.

30:08 And I was like enough with trying to be central casting. I'm gonna be exactly who I am and We're gonna make everybody else work around who I am and It's a lot easier being who you are than somebody else. Everybody else is taken. That was when I was like I'm quirky too. I don't care that I'm quirky. I'm just gonna lean into my quirkiness and be myself. And I've sort of been that way ever since and

30:30 I don't think there's a profile. Oh yeah. You're talking earlier how you'd love to hire somebody with two I love this person and two meh. Is that because of that? Because The person who says all the right things everybody's gonna be okay with. But that unconventional person you're gonna get really

30:46 Two extremes. You're gonna get love or hate. I think what happens as the company scales is you hire for a lack of weakness, not for spiky strengths. And that's institutionalized in the scale up interviewing panel and process. And I think that's a mistake. And I think that's one of the few things that leads to Really mixed.

31:08 success in hiring execs in these companies. Who do you think is the most Underrated public company CEOs. I think the guy running Uber has done a nice job. That was a very, very, very difficult

31:23 Then he took over, he got it profitable. I think she's done a really, really nice job. Very quietly done a very good job. How about you? Oh gosh. Um I think Toby is massively underrated. We were sort of talking about him during the break here.

31:38 What are your thoughts on Toby? Toby reminds me a lot of Colin Engel, actually just Whip smart. One of the things I like about Toby and Colin is their very first principle thinker. They don't Yeah.

31:50 to receive conventional wisdom. They're gonna think it through And scratch. And sometimes you're gonna get it wrong. But a lot of times they're gonna get it right and do something really innovative and smart. Toby's got so much right, he's got some big stuff wrong.

32:05 But for the most part, he's done a really, really good job. He's certainly not central casting. Yeah, certainly not. Uh but I think he's brilliant and a great CEO and a great company. I like that term central casting. Another person who stands out to me uh most people are probably familiar with now, but ten years ago nobody would have ever heard of is Mark Leonard.

32:25 From constellation software. She's not really on my radar. Yeah, exactly. I think they only issued equity at the IPO and they're I don't know, it must be fifty, sixty billion dollar company now.

32:37 I see I wouldn't put Toby in the underrated because I rate him so highly and I feel like people in my circles rate him highly. Yeah. I rate him highly too, and I still think I underrate him. Okay, got it. Yeah. Yeah, totally. There's one other interesting thing that's I think relevant. out of that CEO group. I remember going to the CEO group meeting First meeting change.

32:59 And What I didn't realise is is there is a topic for the whole day. And one of the quirky things about HubSpot up until that point is we didn't have any HR people We didn't allow anyone to talk about culture because we didn't think we could measure it was too squishy.

33:15 And I remember I arrived there on the first day, first thing that put up was the topic of the day and Sure enough, it was called. And I remember thinking that's gonna be a big Big waste of time.

33:28 At least I get to know um my main crush. The whole morning I was pretty disengaged. And then Colin at lunchtime remember he said to me, like, Why aren't you engaging? You don't like the topic, do you? Is it no, I think it's a waste of time. He said, Brian.

33:44 Culture. Culture is how people make decisions when you're not in the room. Culture is how companies really skip. Okay. Okay.

33:53 Okay. Okay. Got it. And then the afternoon sort of engagement and then The next day go to the office and my co founder Dharmesh says How's the how was it? How's Calling? Like how did it go? I said it was really, really good. There's there's one maybe one topic a day. He said, Oh, what's the topic? I said it's culture.

34:12 Shit. A waste of time. I said no Darmatch. Culture is how people make decisions when we're not in the room. Culture is how HubSpot's gonna scale.

34:23 And he said, Okay. And It's very hard for me to assign work to my co founder to this day. Somehow I assigned him to be the culture pub spot and he did an excellent job. And still is doing an excellent job of marshalling the culture from

34:39 You know, fifty employees, eight thousand employees. And he did two clever things. First thing he did is we're big on net promoter surveys. So he he surveyed all the employees. Killing what to ten, how likely you're for HubSpot as a place to work. And then why? Again, people wrote novels about it. And he kind of broke it all up into

34:59 You know, different topics. And then he wrote A PowerPoint presentation. called the Housewide Culture Code that basically describe the relationship being choice. And company It just sort of outlined how we thought about culture.

35:12 And then he posted it on the internet and it blew up on the internet. But we continue to do that net promoter score once a quarter. For the last fifteen years. And we're tracking our net promoter score per quarter. And that's been very, very useful. Then we post

35:27 Every response to the net promoter survey on culture on the wiki and then we address the issues that come up, that best practices surf as well. Every six months we refactor the PowerPoint back. It's a living breathing document. And we basically treat culture like your second product. Like our product HubSpot, if it's unique relative to the competition, good quality product and it delivers value.

35:50 It's like a magnet that pulls customers in and retains them. Same thing with the culture. If it's unique relative to the competition, it's high quality and adds value. Like a magnet that pulls in employees and retains them. And so we put a lot of thought into that culture stuff. And I think a lot about how do you take how do you go from start and scale up. I think a key part of that is getting your culture right and writing it down.

36:11 Institutional. I'm gonna make a statement about culture and I'd love for you to argue Take both sides of the debate, if you will. So I'm gonna say that culture is the only sustainable advantage. I disagree. What? Let's take Nuber.

36:26 They had a certain culture. Dar the new CEO came in. I'm quite sure he made massive changes to the culture the founder put together. And he thrives. I don't I think some of the benefit of course is his culture. But they had major sustainable competitive advantages. in that they had a fleet of drivers and customers and a network effect and software that work.

36:50 And he's probably been there ten years and I don't think so culture. Oh, that's interesting. So so in my mind, I would sort of think of that More like They had a advantage.

37:03 like an operational advantage that came from the network effect and and the scale. I don't know if that would have been enough to sustain it. Going forward without the culture. Fine. I sort of agree with that.

37:18 I think the best example on the other side of this is Satya. Satya's on my Mount Rushmore CEOs. A lot of people push back on me, it's like oh I wasn't a founder. You shouldn't be on there. He's on there for me. because Microsoft was going very, very sideways for a long time. And he stepped in and really did change the culture in a massive company in in couldn't be more impressed with him than the culture change and and how well that works. So that's

37:45 That's my flip side of the argument. It stopped yet. Okay, who else is on your Mount Rushmore? Jerry Garcia is on my mount rashmore. Great CEO. The aforementioned Steve Jobs on there. Why Jerry Garcia? Grateful Dead.

38:00 Really? Why Jerry C? That's the most obvious one on there. Why? No, I'm curious. I'm I'm I'm not a Grateful Dead. I've never I don't think I've ever really sat down to listen to The Grateful Dead. So you're gonna have to walk me through this one. Okay. Um Jerry Garcia was the CEO Cut in the Clop and Colin Angel and Toby Lukey. Really dislike conventional wisdom.

38:22 And kind of rethought everything from first principles. Starting with the music. So they started that band in the mid sixties. And at the time there was all kinds of rock and roll music and there was jazz music, country music, and bluegrass music. And they didn't do any of that. They created a new genre of music.

38:38 people refer to as jam bands now. But Garcia himself was a bluegrass player and the bass player was a jazz musician and T board player was a blues guy and Bob Weird the singer. kind of a country rock and roll guy and they blended them all together And they infuse this jam band mentality into it and they really stretch the songs out with improvisation. So they sort of rethought the genre.

39:03 And made a new type of music. The product was unique. And the go to market was exceptionally unique. If you think of like when I was in high school, if I wanted to go to a Rolling Stones concert I would call Ticketmaster.

39:18 And I would wait till whatever it is, one thirty on a Tuesday. And the rolling stone stickets for us. You know, dial away it'd be five minutes later dial away and it may or may not come through. The the people who ended up buying most of the tickets were the scalpers. The scalpers had a Whole bunch of people buying the tickets.

39:35 That sold the tickets in a mark out. And so the front row of the Rolling Stones concert was a bunch of bankers of venture capitalists, people who could afford the tickets. And the Greel didn't like anything about that shame. Nothing about it.

39:48 They particularly didn't like a bunch of bankers and and venture capitalists in the front row of their concerts. They wanted their hippie crazy fans in there. They also didn't like the distribution setup. So it's grateful then. And then Ticketmaster took their slice. And then scalpers took their slides and then the fans.

40:06 So they said we're gonna disintermediate just like the internet did to so many things. We're gonna disintermediate those two layers and we're gonna sell tickets directly to customers. The way they did it was you listened to a four one five recording. That explain what was going on. And the way Shane you would buy the tickets was You have to

40:22 Put a three by five card. Which concert you went to? You can only buy four tickets per concert. Yeah, so the scalpers Are less intensive.

40:32 And then you had to go to the post office to get a postal money order. So just a total pain in the back side to get a postal money order. And then you had to put a self address down below. And then you put a regular envoy and meld it in Now how would the Grateful Dead Chain decide Who gets the front row seats?

40:48 I have no idea. The way they sort of did it was that self addressed stamped envelope, the more beautifully you could decorate it with dancing bears and mushrooms and sprinkles. Yeah. I love it. Yes. So they solved a bunch of problems.

41:02 That's not the end of it. When was the last concert you went to, Sheen? Oh God, I uh it's been a long time. Did you go to Taylor Swift? No, I ha I am a Taylor Swift fan. Okay, let's just say you went to Taylor Swift in Ottawa. Yeah. And you showed up with your Giant camera.

41:19 And you're boom microphone. And you show up there. What would have happened at the at the gate? They wouldn't let me in. Why? Why didn't she want you recording it?

41:27 It might affect other people's experience if I have a boom mic. I mean sh you can't prevent people from recording on their phones, so A at some degree they're accepting it. The NBA actually went through this a couple years ago. They were trying to like really block people from posting clips on social media. Then they actually embraced it and it changed the whole league. More

41:49 It got way more people in uh sorry, this is like a sidetrack to this, but like that change in the NBA really changed the NBA. Okay. Pre iPhone. If you let's say you were going to a Rolling Stones concert and you had all that equipment you're walking up, of course they would block you. And the reason is you see the Rolling Stones in Boston and New York and then Philly and then Miami. The exact same concept. Like they don't miss a note, they're fantastic. Same thing. When you walked into the Grapple Pit with your big boom mic in your

42:18 Big camera. They put you right in the taper section. The perfect spot to watch the concert. Maybe said they need you to tape it. And you taped it and then you went from Boston, then you went to New York, you taped it, you went to Philly, you taped it, then you went to Miami, then you get back to your dorm room and you copied as many tapes as you could of the best concert, not the worst concert. And you gave them up to all your friends. And

42:41 That was how they market. They gave away the content. They were the first in down marketers to really nail that. They were the first real premium model. They were the first viral marketers. And the way they did was brilliant. And it worked for them. Because every concert was quite unique. They're a jam band, so they've never played the same set list twice. And so there was an incentive for knuckleheads like me to go from Boston to New York. That that that that's up and down the east coast. In fact

43:06 I did that last week, I was at the sphere. And I saw them uh Friday, Saturday, Sunday. Garcia was a genius. He's a marketing genius, actually, and I think he's a music spot. That's fascinating. Uh I'm gonna have to listen to The Grateful Dead now. I'm like I'll send some Yeah.

43:24 I wrote a book on this called Marketing Lessons from the Great Fed. We started talking about inbound marketing there. I'm curious as to you guys pioneered inbound marketing to to a big extent. And and definitely got the momentum rolling there. How is that? change in the past few years and where is that going in the next few years?

43:44 Ironically, I think it kinda went out of favor a bit over the last two years and I think it's about to come back. In Faber. The things that change about it aren't that different. Cole calling people. And spamming people

43:59 In advertising it people. in renting space on YouTube or renting space on your podcast or your blog or renting space on New York Times. Create your own New York Times, your own podcast. And become your own publisher and then pull people in through Google and search and other social outlets. It works very, very, very well. You're you're living proof of how well it works. The things that have changed are the social media networks have changed. When we first wrote about this before we started HubSpot, we started writing about marketing. Dig and Reddit were the two big uh social media sites. I don't Things around and Reddit gone through all these iterations.

44:35 But obviously with Facebook and now it's TikTok, it's Instagram, um, it's all these new social media sites. It's you two. Yeah, people live in YouTube. It's podcasts. And so the medium Isn't necessarily a long form blog like it was back when we started HubSpot. It's videos a lot of short form videos. And so that's changed quite a bit.

44:55 I think what's interesting about What's going on now. is today you go to Google and you get your ten blue links. If you look across our customers, that's sixty two, sixty three percent of the inbound traffic is via Google. And most of it's organic. I think over the next five years that's gonna change a lot. I think Google's gonna have to change a lot. And I think people are gonna spend more and more of their time inside chat GPT and they're all chat GPT's competitors.

45:21 And I think when you're engaging in that way and you do a search in chat GPT for let's say HubSpot, it'll tell you about HubSpot and then you'll say, Well, how does HubSpot compare it to Salesforce? It'll tell you about that. how much HubSpot cost it will tell you that like you will know a lot about HubSpot. One of the brilliant things about Google is their blue links and they didn't mind sending off their website. It's a very counterintuitive idea. I think that's gonna start changing as consumer behavior changes and uh I think be really interesting to see how it evolves. Do you think content is just gonna get overwhelming? I mean

45:51 You can create content with like Two sentences now, you can create blog post that would rival oh the best people were putting out maybe Ten years ago. with almost no effort whatsoever. I think you're right. And I think it's not just that, but it's gonna be email. Like I think the the robo emailing and the

46:12 B D R is I look at lots of startups in the CRM spaces, you might imagine, but there's How about forty eight? Startups building automated AI agents. I still think have a unique perspective and a unique personality. is gonna work. I I don't think your podcast goes away because I start something that sounds like you

46:33 gonna use an avatar to deliver it. I think something what you're doing will last the test of time. And I think a lot of people, particularly in scale ups, run away from their personality. They make it generic and like you have a certain vibe and a certain personality. I think that kind of works for you and it's It'd be very hard. Quality and uniqueness. Never go out of style and I think are gonna be increasingly important as the internet just fills content.

46:57 That's yeah, I generally. It's almost what you said before, like lean into your individual quirkiness and your tribe will sort of find you and then go around with you. Although you have me worried, we're almost a million people on our newsletter now. I'm like, Oh God, if this is going away. I got problems. I also think we're gonna see the trend, and I'm certainly not the first person to say this, but I think you're gonna see a lot more small, big companies. And you're gonna be able to get a lot more done with a lot less people. Uh I don't in a billion dollar company you're gonna need.

47:26 three, four, five hundred person marketing organizations. I think the new tools are coming out, including UpSpot tools and the CRM suite. I just see how incredibly powerful they are. I think you're gonna be able to scale in a whole new way. And I think the AI revolution Like when it comes to inbound. I think top of the funnel gets more difficult.

47:47 I think middle of the funnel gets easier, but really high quality personalization on your website on chat on everything. That gets much more powerful, top of the funnel gets more difficult. Yeah. I think inbound's gonna change. But I also think inbound gonna kinda make a comeback. How do we do outreach in a world of AI and in a world where people are bombarded with Is it gonna be freemium and then pulling people in through that and like the outreach is letting them know about the freemium stuff? Gotta get good at the branding thing. Again. Turns out.

48:15 Because getting into your or my inbox is gonna become exceptionally difficult with all the changes Google's making to email. That's getting harder as it is. but the robo emailing is gonna go wild and the robo content's gonna go wild. So it's a little more around brand. You have to kinda be good at everything. It's like a baseball five two player. You have to be getting found in YouTube. You have to be getting found in all the social space. Chat G P T's gonna understand you perfectly well. Google's gonna understand your Perfectly well. You need people tripping over here all over the place.

48:42 I think people have to get comfortable with the fact they're gonna get less new visitors to their website. because ChatGPT and their ilk are gonna know so much about you and not have those lists of blue links. They're just gonna live on there and learn so much about you. And then when someone's quite serious, they end up on your website and you have to get very good at personalizing that website experience. I also think people are going to end up keeping more information behind the paywall and the login wall on their websites because

49:09 They want to keep a little bit back from chat GPT. Because Chat G B T is gonna understand the public stuff as well. I guess the baby step that Google made on that was like when they would just show you sort of the excerts. Yeah. If you asked a question, it'd be like Basically giving you a link, but it's like really hard to find. It's like here's the answer to your specific question.

49:31 YouTube is fascinating because unlike voice podcast. YouTube has virality to it. So like when we do a an in person recording The U two breach Is larger

49:44 In some instances, not all, then are podcast reach. And so we get like three hundred thousand people sort of listening to a podcast episode. But on YouTube We'll get three hundred to five hundred to a million. Nice. people, but it's YouTube's algorithm picking it up. It's like people watch this.

50:02 But what we can't do is like send people off that platform. So it's really good for like stats. Like I I was at the the gym the other day and this guy's like I got two million TikTok followers, but I can't do anything with them. Yeah. So so I can keep them on this app and I'm really famous in this localized environment, but TikTok is one hundred percent in control.

50:21 I don't own that relationship. Same as YouTube. I don't own the relationship with the viewer YouTube does. The minute it doesn't like me and wants to cancel me or doesn't like my content anymore or wants to promote a different message. Whatever that algorithm is that's doing that can just like Y you're gone.

50:38 Mm. Think you're right. I thought was gonna roll over and play dead there for a little while, like I moved most of my search traffic to perplexity really like it. Google's kinda starting stuff a whole bunch of stuff, but recently they're making noises like they're not gonna roll over and play that to complexity.

50:54 That's such an interesting company right now. And to watch their moves will be very, very interesting. It's challenging time for them. But it looks like they're gonna they're not gonna let Perplexu just hoover up a bunch of their users. Hopefully not. We all want some competition here. I have a couple of random questions. I'm curious what you've learned about making decisions that you think other people miss. On my CEO journey

51:17 For a long time. I would kinda look for consensus. I think consensus is really the enemy of scale. And so I used to say whenever we're making an important decision There should be winners in the room and losers. We shouldn't find like that negotiated settlement that everyone's happy.

51:35 Somebody should be unhappy. Three or four people should walk out and happy and one should walk out happy. And we're all we're all gonna be good with it. As you get bigger, this gravity pulls you towards consensus, and I think consensus is the enemy of breakfast. How do you fight that?

51:50 I write that on whiteboards. I talk about that inside of HubSpot. I try to make an example of that every time I'm in a room. I've written a bunch of blog articles about that. At one point inside of HubSpot, we had a terrific TOO. I love And he had a lot of great qualities. One of his qualities I didn't love was he was a consensus person. And we have a lot of conflict over that. And so we talked about that a lot. The management team talked about that a lot.

52:16 But I sort of had this thing like there's gonna be winners and losers in every argument. And if no one walks out a little bit sore, we probably made the wrong decision. So go deeper on that for a second, though. So put me in the room at one of these meetings. Well There's four people on one side, there's four people on the other side. How do we come to that decision? Is it the highest paid person in the room? Is it the person closest to the problem?

52:38 Who actually makes that call? Let's just say it's my call, which is rare. And two people in the room. Are saying black and two people in the room are saying white. I think the the majority of CEOs are walking out of the room with the decisions great.

52:52 Trying to please everybody. Yeah. Try to thread the needle. And I think that's a problem it creeps in more and more the bigger you get the worse that problem gets. And I always tried to walk out of the room. It's like we're gonna pick Black or white. Yeah. You lose this decision, you might win the next one. Let's not get all pissed off about it. We'll all survive. And I think that's the right way to scale it.

53:13 Is there anything else you've learned about decision making that you're like Oh, I wish I knew this sooner. I would say one thing I've learned about scaling a company like from the outside. Went from company with an idea and two employees to No, it's worth thirty billion dollars and uh

53:31 eight thousand employees and It looks like a smooth graph from the outside, but I'll tell you what. It's a grind on the inside building up spot. It's very much two steps forward, one step back. Two steps forward, one step back. Two steps forward, one step back. Oh

53:49 All we And there was no silver bullets along the way. There was no one higher that completely changed the game. No partnership to change the game, no customer, no investor. It was all kind of two step four, one step back, two step four, one step back.

54:04 And the other thing I would say about the journey Is Kind of related to that. There was definitely war time and peace time. When you're halfway through a two steps forward, it was peace time. When it's one step back was four time.

54:17 And I love war time. I'm definitely a wartime CEO. I need peace time. I really need to sit on my hands and just let it go. Like it's going great. Leave it alone. I have a hard time doing that. And I think certain CEOs are peacetime and certain CEOs are war time. I'm very, very, very much. Like Covid, war time. We made so many changes during Covet, I

54:39 Hated Covet and I hated being back in society but in Side of PubSpot. That was the function. What does wartime mean for you? Is that like we're fighting for our very survival? Does it mean we can just move faster and sort of ignore some of the bureaucracy? What what does it mean? I think peacetime is bottoms up. And more consensus or time more top down. It's like, hey, it's war time. I don't have time to build consensus on this. This is what I think we should do. We're going left.

55:06 Um Oh. Uh and I like that about wartime. And wartime is like okay. I remember two thousand ten, the economy was shaky back then. We were a very young company. Maybe it's two thousand nine.

55:19 And our retention statistics were Horrible. Everyone was canceling our product wasn't bit back then. And we lost, I remember of the thousand customers we have at the beginning of the year, we lost like seven hundred of them, like Just

55:32 Yeah. In two thousand and nine, and that was essential. And it was like let's just stop the music. And start over, everything we're doing going forward has nothing to do with signing up new customers. It's like how do we delight every new customer we have? Let's stop obsessing about how do we turn a prospect into a customer.

55:51 Let's obsess about how do we turn a custom into a delightful customer. And so that was a crisis that really worked. We changed the culture of the company. We changed the center of gravity from prospects to customers. Never waste a good crisis. That was a really good crisis. While you were building this, how did you manage And I don't want to say balance. It's the wrong word, but it's a word everybody understands. How do you how did you manage work life harmony? or balance, uh, especially during the high pressure periods with

56:17 Uh young family I didn't I did it very poorly. What would you go back and tell your younger self now? I'm really proud of it. I think my grandkids will be proud of it. Um and I think it took a

56:30 Big effort on my part to call it all. And if I said, Oh man, I wish they just put in forty hours a week back then. I wouldn't be sitting on those podcasts. We wouldn't have pulled it off. And I know that's not the popular answer. I'll probably get cleared on Twitter for saying that. I

56:44 I think that's reality. It was it was the full contact sport. I've noticed this thing and and I think people don't like talking about it, but When you find exceptional people who've done exceptional things like yourself. They're not always the most well rounded people. in every aspect of their life. And yet

57:04 We sort of expect them to be, right? It's like W we We love Warren Buffett, but we want him to also be a better family man. Right. The weird thing is the minute Warren Buffett starts doing that, he's no longer somebody we're talking about as Warren Buffett.

57:20 And it's so it it goes back to those sort of like strengths and weaknesses. And My hypothesis is that people at the tail end of the curve have incredible strengths and incredible weaknesses. And by trying to address those weaknesses, whether it's school, society, nudging people, we actually limit, we put a ceiling on the strengths that those people can actually deliver.

57:42 to the benefit of the world. You'll probably read on Twitter for saying that, but I agree with you on that. I will give I'll give you an example. I've never been married. I want to get married. On my actually on my to do list this year. I don't know if it's gonna be this year, but I never did it in every time I had a relationship. Like first.

58:02 Um And do I regret it? I don't know. I've had a really good life. I've really enjoyed the hub spot run. I'm super proud of it. I think when I'm eighty five and looking back on my life, I'll still be super proud of it. I think my grandkids will be proud of it.

58:19 So yeah, I need some sacrifices. I'm okay with it. We always end the podcast with the same question. I think you'll have a really good answer to this. W what is success for you? I think that's a really cheesy James Taylor song named The Secret of Life is Enjoying the Passage of Time.

58:37 I think she's very right about that. Uh and think about that post my accident. I very much try to not do anything that I don't want to do, or if I'm doing it, not to do it. Very long. And I try to live in the present and stay out of the past too much and stay out of the future too much. I think the secret of life is about how do you set your life up so you're really enjoying that.

59:01 It's a beautiful answer. Thank you so much for coming on the show, Brian. Thank you, sir. Thanks for listening and learning with us. For a complete list of episodes, show notes, and transcripts and more go to fs.blog slash podcast or just Google the Knowledge Project.

59:25 Recently I've started to record my reflections and thoughts about the interview after the interview. I sit down, highlight the key moments that stood out for me, and I also talk about Other connections to episodes, and sort of what's got me pondering that I maybe haven't quite figured out. This is available to supporting members of the Knowledge Project. You can go to FS dot blog. Slash membership.

59:48 Check out the show notes for a link and you can sign up today. And my reflections will just be available in your private podcast feed. You'll also skip all the ads at the front of the episode. The Furnham Street blog is also where you can learn more about my new book, Clear Thinking. Turning ordinary moments into extraordinary results. It's a transformative guide that hands you the tools to master your fate.

1:00:10 Sharpen your decision making. And set yourself up for unparalleled success. Lear more at fs dot blog slash clear. Until next time.

What you see above is a preview of the first minutes. One unlock costs 10 credits and covers this episode forever: full segment and word-level timestamps on this page, plus .txt, .srt, .vtt and word-level JSON downloads, as many times as you like.