This is a guest post from Rick Burnes, the new vice president of content products at BookBub.
When the history ebooks are written, this month could go down as a turning point for the Boston tech community. Two Boston IPOs this month — Wayfair’s on Oct 2 and HubSpot’s on Oct 8 — were major milestones for companies that could become new anchors for the local startup ecosystem.
So what can Boston-area startups learn from the success of these companies?
I’ll leave others to weigh-in on the story of Wayfair, but at HubSpot, where I worked for six years before leaving two weeks ago to join BookBub, the root of success is great senior management.
Yes, senior HubSpot managers are smart, analytical, experienced, visionary, have diverse talents and passion for the domain — but those are baseline requirements for any venture-backed startup.
There are three other things that are unique about the HubSpot management team and the strategies they’ve executed on over the last eight years:
1. They all have an uncomfortable focus on scale.
2. They are all story-tellers. (They can distill complex ideas into elegant narratives.)
3. They all have a healthy balance of confidence, paranoia, and the ability to execute.
Let’s double-click on each of these points.
Exceptional Focus on Scale
Boston tech companies built in the last 15 years are notorious at scale. With a few notable exceptions, companies in Boston underestimate the importance of massive, industry-leading numbers (users, transactions, pageviews, whatever is important). I saw this first-hand when I was trying to hire marketers at HubSpot who had experience managing massive websites or blogs. Those kinds of people are in short supply in Boston.
HubSpot, along with Wayfair, Kayak, TripAdvisor, and a handful of others, is a exception to Boston’s tendency to think small.
What did the HubSpot management team do differently? Expectations and goal-setting. Most companies talk about scale, then set comfortable, reasonable goals. The HubSpot management team sets uncomfortable, often unreasonable, goals.
The INBOUND conference attendance growth is a good example: At a normal B2B software company 500 attendees would be a great first-year conference goal. HubSpot’s goal for the first year of INBOUND was 1,000. That was a huge, uncomfortable stretch at the time, but we hit the number, and the success catapulted the conference into a different league. The scale allowed us to attract speakers, sponsors, and attendees the next year that kept the conference growing — growing so much that this year, only the 4th year in, HubSpot’s INBOUND had 10,000 attendees, making INBOUND one of the world’s biggest marketing events.
Over the years, the impact of uncomfortably ambitious goal-setting compounds — not only because the numbers add up, but because exceptional scale opens up opportunities like partnerships, PR, and hiring. If you set comfortable goals, those doors never open.
Ability to distill complex ideas into elegant narratives
Communication is another key to the HubSpot management team’s effectiveness. Marketers spend lots of time on narratives that help drive sales, and it’s obvious that the HubSpot management team does that well (think “Inbound Marketing”). Less obvious, but just as important to HubSpot’s success, is the way the management team uses great communications skills internally to motivate and focus their troops.
Here’s an example that was particularly motivating for me:
“HubSpot Is the iPod of Marketing Software” — When I first discovered HubSpot in 2008 I was skeptical about the company. I couldn’t figure out how HubSpot was significantly different from the thousands of SEO and blogging agencies on the web.
That changed when I went in for an interview and sat down with chief executive Brian Halligan. He started waving his arms and explained that HubSpot wasn’t just SEO and blogging software. It was the iPod of marketing software — a platform that was going to consolidate and simplify the fragmented, complicated marketing software space. His story was easy to understand and compelling. I was sold.
That narrative had the same affect on many others, and helped HubSpot build a focused, top-notch team.
When you tell compelling stories, people follow you. Customers, partners, employees fall in line because you help them understand how to act in a complicated world.
25% confidence, 25% paranoia, 50% execution
Above all else, the HubSpot management team has the right balance of confidence, paranoia and execution. This balanced operating system enabled HubSpot to work its way through the ups and downs that any startup encounters.
The growth of HubSpot products and revenue sources is a good example of the management team’s balance.
HubSpot started life as an SEO and blogging tool. We had lots of success selling this software in 2008 and 2009, and we were happy. Many businesses would have doubled down on SEO and blogging and built a modest businesses there.
The HubSpot management team took a different approach. They were confident they could do more than SEO and blogging and they were paranoid that SEO and blogging alone would leave the company exposed to too much risk. So they chose to execute on a bigger, more ambitious vision. They built landing pages, a CMS, a lead management tool, email marketing software, marketing automation and social media tools. By 2012 HubSpot was a completely different product — it was a full marketing software platform.
Two years ago, the management team reached another similar juncture — they were having great success with the marketing platform. Customers were thrilled with the software, and growth from the marketing platform alone seemed strong enough to power HubSpot through a successful IPO.
But because they were confident in their vision of inbound’s impact beyond just marketing, and they were paranoid that they would not be able to compete with the world’s largest software companies without a broader footprint, the management team made another big bet. They began building the sales platform that was launched at INBOUND last month.
It would have been easy for HubSpot to lean back and enjoy its relative success. But because the management team was confident in their vision, paranoid about threats to their position, and great at execution, they pushed harder and kept growing.
Building an anchor company in Boston
There’s one other thing that’s important to understand about the HubSpot management team: They want their company to become an anchor for the Boston startup ecosystem.
Brian, his co-founder Dharmesh, and the rest of the HubSpot management team watched West Coast giants disrupt the last generation of Boston technology anchor companies. They feel the shortage of these companies in Boston’s tech ecosystem today, and they want HubSpot to help fill the void.
Because of everything I explained above — confidence, paranoia, ability to execute, ability to communicate and a focus on scale — I think HubSpot is better positioned than ever to continue growing and become one of those companies.
In fact, I’m one example that they’re already becoming one. After an awesome six-year run, I’m taking what I’ve learned and going to help build another big company in Boston. Stay tuned.
Rick Burnes is the at VP of content products at BookBub. Previously, he was the product marketing director at HubSpot.