GrubHubMike

The Far Flung Sales Team (25 employees)

 This is the sixth installment in my series on going from 1 to 50 employees.

Most of the growth in our employee ranks came from a national sales team.  Once we got to 25 employees, 9 of them were out in different markets signing up customers.  The work experience for these valuable folks is very different from those of us in the office.  They work from home.They have minimal contact with their supervisor. Their compensation is very clear cut and based on performance.  How do you extend company culture to them?  Is that culture relevant?

The Second Office (15 employees)

 This is the fifth installment in my series on going from 1 to 50 employees.

Once we hit 15 employees, a lot of stuff that happened automatically before wasn't so automatic.  We moved into a larger office and communication started to get confused.  Seemingly simple sales and marketing messages all went through a disastrous game of phone tag.  Lots of simple things were added to help communication: cross department meetings, monthly strategy sessions, public calendar scheduling, etc.  All routine things for most businesses.  But they weren't routine for us, they were revolutionary. 

The Office (7 employees)

 Getting our first office was really exciting!  This is a continuation of my series on going from 1 to 50 employees.

One of my original claims to investors was "we operate efficiently without any need for an office".  At some point having an office stopped looking like a liability and started looking like an asset.  An office makes communication easier.  Best practices get shared.  Policies are easier to keep consistent.  At 7 employees, the cost of the office is very small relative to the cost of payroll,but the benefit to each employee is very large. So go ahead and get those  swanky new digs.

Running the Chicago and NYC Marathons

In March I decided to run for this charity in both the Chicago and NYC marathons. I've been training pretty consistently for the last 4 years. Sometime in July I realized I was seriously fatigued with this ongoing training. Only through the support and encouragement of my friends and family was I able to keep running "for the kids" Thanks to their support I ran 552 miles from June 1 to November 1.

The Chicago marathon dawned on a beautiful October day. What a great race.  Three weeks later I ran NYC. It turns out that 3 weeks is probably not enough recovery time. Somewhere around mile 12 I realized I was in trouble. Finishing that race was one of the hardest things I will ever do. 

What inspired me to keep running was my donors and our shared commitment to Team Hole in the Wall. The evening before the marathon, I met with several great people including several volunteers from the Team Hole in the Wall Camps, an adult survivor of several aggressive forms of cancer (who now works at the camp!) and Paul Newman's daughter.

I was deeply moved by the bravery, laughter and tragedy of the kids who attend the THITW camps. I'm honored by the contributions that made it possible for 2 more kids facing life threatening illnesses to go enjoy a week of joy and healing.

The Other Founder (4 employees)

The third installment in my series on going from 1 to 50 employees. After I had things up and running and did all the hard work, the other founder waltzed in.  Actually, that isn't accurate at all, but I like to give him a hard time about it.  Back when it was just a hobby, we spent a lot of time thinking about how to run the business.  As you can see by our detailed business plan:

The nice thing about having a partner is perfect alignment of interests. Shareholders have a different risk profile.  Employees have their own personal interests in mind.  Customers only want what befits them.  A partner provides a lot of peace of mind because you can discuss any issue knowing that you have the same goals and interest in mind.  There are a lot of things coming at you as an entrepreneur. Its nice to know somebody's got your back.

Divide and Conquer.  Most early hires made my job harder. I had to do a lot more work. More sales means more product enhancements and data entry. More people is more management. Additional folks add complexity and scope.  A partner, on the other hand, actually helps decrease workload.  Tasks can be divided. Competency and expertise in specific areas can develop.  Of course, you've got to trust their competency and integrity. Which leads us to tool #3 in getting more employees:

Tool #3.Throw away the partnership documents.  Get a handshake you can trust.  I swear we spent 100 hours arguing over the minutiae of our partnership document.  This was largely based on several people I knew who had been screwed by their partners.  The lesson to be learned is *not* about getting a long contract.  In the end, you just need to pick the right partner. Because, if they want to screw you over, they'll find a way regardless of what papers have been signed.

2 is company (2 employees)

The second installment in my series on going from 1 to 50 employees.  I used this first tool of getting to revenue as fast as possible, and now I have some extra cash to hire employee number 2.  What role should I hire?

The first role should be based on increasing revenue and product value, not on decreasing work for the founder.  In fact, this trend should continue through the first 5 or 6 employees. Hire more people, generate more revenue. Rinse and repeat until the pressure for ancillary tasks becomes great enough that they can no longer legitimately be called ancillary tasks.

Our first employee was a sales representative.  But really she was more than that, she was another entrepreneurial oriented person who was ready to wear a lot of hats.  She was ready to help refine our product and sales materials.  But be aware, salespeople by definition change the product.  So much so that I've got my own pithy saying about it:

"No product ever survives unscathed first contact with a person trying to sell it"

But how did I attract good talent without a lot of cash for compansation?  Well, that brings us to our second tool in going from 1 to 50 employees:

Tool #2: Options and Environment.  Finding and motivating employee #2 can be very challenging.  Options help (though less so in the midwest).  The right person for this role will be very interested in equity.  The right option plan will provide long term incentive when cash is hard to come by.  More importantly, the startup environment will be very attractive to the right person.  Meeting in coffee shops, lots of responsibility, and flexibility in direction should inspire rather than frighten early employees. 

Its Just Me (1 employee)

The first installment in my series on going from 1 to 50 employees.  You've got to start hiring somewhere.  So, start by hiring yourself. 

Before GrubHub was a business, it was just a hobby.  I played around with a website, got some information about restaurants, put together a business plan, had an advisory board did some advertising.  All of these activities certainly look like a business, but really they are just a hobby.  A great adviser told me... This thing will never get off the ground unless you really commit to it.   He was right. The mental difference between doing something cool and running a business to pay the bills is night and day.

Once I jumped on full time I found out quick that there was a profoundly large amount of work.  By necessity I resolved to do exactly 2 things: Sell the product by day.  Improve the product by night. Sure, there were a million other things to do... SEM/SEO optimization, business licenses, scalability, etc.  But I put all that on hold and went into a relentless, sell -> improve -> sell -> improve cycle for about 6 months.

Another important step was to commit to paying myself from day 1.  This isn't going to be a hobby, I'm not going to do this for free for 2 years.  If I can't support myself within the first 2 months, I was going to quit.  Which really just focused me to do the important stuff... make some money... which leads us to the first tool in the bootstrapped businesses toolbox: revenue

Tool #1: Revenue.  Apparently there are business models that are proponents of not making money right away, but I don't get them.  Cash allows an entrepreneur to hire people and resources to get things done.  At first it is all about increasing velocity on the sales -> product -> sales cycle.  Successfully executing that cycle then requires supporting activities... billing,finance,IT infrastructure, etc