In this post Dea Wilson, Lifograph founder, is doing an interview with Gary Swart, VC at Polaris Ventures ($450M invested) and former CEO at oDesk (currrently Upwork - after the merger with Elance).
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What are the most important traits of a successful CEO?
There are so many, it’s hard to narrow the list to the most important…which is actually one of the traits. Good CEOs have the ability to focus on the right priorities, and to spend time on the 20% of initiatives that yield 80% of the results.
A successful CEO also knows their strengths and weaknesses and is good at surrounding themselves with people who complement their skills. Additionally, successful CEOs are perceptive and execution-oriented, and also have a bias towards action, strong organizational skills, great communication skills, confidence and charisma.
3 things people don’t know about you
- When I graduated college, I went into manufacturing of precision metal products. After a couple years, I took a step back to look at what my career path would be if I stayed on that track, and realized the growth prospects for the manufacturing industry did not look good. I decided I needed to get into a growth industry, like high-tech. My wife and I put our house on the market, then packed up and moved from the East Coast to Silicon Valley, where I started working at Pure Software.
- Despite being in technology for 20 years, I do not have a technical background. I have learned enough to be dangerous…mostly to myself!
- I have 4 kids, which keeps me pretty busy outside the office.
How would you define leadership?
Leadership is getting a group of people together to achieve a common goal. Effective leaders build great teams and then create environments where these people can do their best. A good leader effectively guides others and, as a result, will naturally have followers.
Do you have a career opportunity you passed on and later regretted it?
I had the opportunity to be an early team member at Netflix. The company I worked for at the time, PureAtria, had just been acquired and I was offered a key role at the acquiring company, Rational Software. The role at Rational offered me everything I was interested in at that time, including the opportunity to make an impact, the potential for professional growth and development, good financial rewards, and work-life balance. I did not have a compelling reason to trade that for a high-risk opportunity.
With the benefit of hindsight, I regret not making that move; I think Netflix could have fulfilled all of those requirements, as well as broadened my experience.
What are 3 most important contributing factors to oDesk’s success?
The three most important contributing factors to our success are the team, the strategy, and the business model. Of course you also need a large (and growing) market and the money to execute in the first place, but it’s how you execute that makes the difference between success and failure.
First of all, there’s strategy — which I define as prioritizing what you work on to achieve the desired results. It’s important to identify and communicate the right priorities before doing anything else, in order to focus the team in the right direction.
oDesk’s strategy is simple: Connecting the world’s best freelancers with the world’s best clients, and giving them the tools and infrastructure they need to work together successfully via the Internet. oDesk has amassed the most liquidity of jobs and freelancers, and is now the world’s largest online workplace — more than 550,000 clients and 3 million freelancers are registered on the site, and more than $360 million in work was billed through oDesk in 2012 alone.
The second factor is our business model. From the beginning, we set out to best replicate in the online world the way work happens in the offline world. In the offline world, people are hired and fired based on their results, but are paid for their time. oDesk built functionality that provides the best way to work online, with guaranteed work for clients and guaranteed payment for contractors. It was this innovation that differentiated oDesk from everyone else in the market, enabling us to create the most liquidity, as described above.
The third factor contributing to our success is our team. Having a large market, a good strategy and the right business model are all important, but if you don’t have an all-star team in place—one that can not only help pick the right priorities, but also execute on them—then maintaining a competitive advantage will be difficult.
What was the tipping point in your company history?
oDesk has always enjoyed rapid growth; we’ve seen an 8x increase in hours worked through the platform since 2009. There was a tipping point in our business when we decided to open up the network, allowing clients and freelancers to connect directly through the oDesk platform. We also lowered our fee from 30% to 10% and saw a dramatic spike in volume of jobs as well as an increase in lifetime value of clients.
We have had our fair share of lows in our business, mostly around disappointed clients, which we all hate to see. It’s important to not waste those opportunities to learn as much as you can, making you stronger the next time similar issues arise.
What is the secret behind successfully managing people?
The secret to successfully managing people is to get the right people on the team in the first place! In all seriousness, getting team members with the right personal characteristics, motivation, skills and knowledge is paramount to managing and leading a great team.
With that said, once your team is in place, you have to provide them with clarity as to where the company is going, as well as communicate to them what their responsibilities are and how you will measure their success. Once the clarity, responsibility and standards are in place, successful managers create team commitment by providing regular coaching for improvement and by having a good reward system in place.
What are 3 most important metrics you constantly evaluate?
The key metrics in our business are Gross Services, which represents the total volume going through our network, Net Promoter Score as a measure of customer success, and Lifetime Value of a client. All of these metrics are important to let us know how we are doing today, while also giving us a leading indicator of how we will be doing in the future.