How We Work: Kabbage Avoids Bureaucracy As It Continues to Sprout


This is part of our How We Work series, which focuses on how successful southeastern tech companies are developing authentic work cultures.

When you walk around the headquarters of fintech company Kabbage, you see a lot of open doors. You see a lot of vegetable puns — their internal newsletter is “The Beet” and interns are “Brussel Sprouts” — and dogs (and a few kids) walking the halls next to their owners/parents. 

What you don’t see are many high walls. You don’t see name plates with fancy titles on desks.

You also don’t see any hard alcohol, but we’ll get to that later.

“We’ve both worked in places where all people cared about was titles and not actually getting things done,” says co-founder and President Kathryn Petralia. “We didn’t want to work in a place where someone was like, ‘I’m SVP, and you’re only an AVP, and therefore I’m more important than you.’ You can’t have a flat organization for very long and we’re past that, but we don’t need to have titles.”

Petralia founded Kabbage with CEO Rob Frohwein in 2008. Kabbage serves small businesses with a data-driven loan platform that allows business owners to access capital more quickly and easily than traditional banks.

Petralia is understating that the company is past the “flat organization” stage. After raising $250 million from SoftBank in mid-2017, Kabbage is valued at over $1 billion. It has swelled to 500 employees across five offices, including Bangalore. 

They recently passed the milestone of $6 billion total lent to users and continue to expand their suite of products and services. In 2018 they launched the Kabbage Card, a debit card-like product that lets customers access the exact amount of cash they need, when they need it, rather than estimating what they’ll need in a loan.

They also recently completed their first acquisition of New York-based Orchard, a data provider focused on online financial transactions. And Petralia hints at their foray into the payments space, a trillion-dollar market that many experts say is ripe for change.

So Kabbage continues to grow, reflected in their new headquarters in Midtown Atlanta, which houses 375 employees. As they do, Petralia and Frohwein, and the rest of the leadership team, are determined to maintain their accessible, low-hierarchy culture.

Planting the seeds of Kabbage’s culture

As with any company culture, it all starts in the hiring process, something taken very seriously at Kabbage. Frohwein, Petralia, or both try to interview every single person that gets hired at Kabbage.

“We always want to be involved in that part of the process,” says Frohwein. “Part of that is to keep culture consistent, since we understand how the company is evolving in that way.”

So once a candidate has made it through several rounds of interviews, they are called into a final screen with one or both co-founders and/or Head of People Operations Amy Zimmerman.

For Frohwein and Petralia, part of what they’re screening out is the kind of personality that would make a candidate unable to work at a place where a corporate pecking order is discouraged. Petralia will sometimes ask the receptionist how the candidate behaved towards them.

It comes down to ego, says Frohwein.

“One of the questions we ask everybody, regardless of your role, is what is one-half plus one-third. We had one individual… who was so offended. That should’ve been an indication to us that if anybody thinks they’re too good for us, they’re probably not a good fit.”

“You introduce a small cancer inside a company and that grows very quickly. So you have to avoid that,” he says.

Kabbage’s titles are designed to avoid ego. Managers or project leaders are designated as Kabbage “Heads” (remember those vegetable puns?) There are no VPs, no Directors. 

It works well, says Petralia, because people who may not necessarily want to oversee other employees don’t feel the pressure to become a manager.

“Some people are just amazing architects or coders or designers. So we make functional distinctions, but it’s much more about what the role is and what you do,” she says.

One might say that a lack of traditional titles could limit an employee’s future career trajectory. To that, Frohwein offers a simple solution.

“Call yourself whatever you want on LinkedIn. It’s all about being reasonable, and I think that translates to be an adult,” he says.

That mandate — be reasonable — has guided many of the company’s culture decisions over the years.

How not to descend into chaos

“Be reasonable,” something that is echoed several times by all three executives, appears to be a central theme at Kabbage. It applies to their flexible, unreported vacation policy, to the co-founders’ open door mandate, and to the anonymous email inbox to which employees submit feedback to leaders.

“I’m not willing to create structure and policy for the sake of creating policy,” says Zimmerman, who was originally trained as a social worker before entering HR two decades ago at the same startup Petralia worked at. Her team of 20 oversees all aspects of recruiting, benefits, and professional development.

“Use good judgement and care deeply about people, and usually the decisions are going to be the right decisions,” Zimmerman says.

Instead of rules, her team often suggests “guidelines.”

“The way we communicate things is a lot of ‘It would be nice if you would consider…’. We don’t go punitive,” she says. 

That broad trust has occasionally gone awry, according to Kabbage leaders. They had to ban hard alcohol in the office, as well as an open jokes email that was taken advantage of. 

What does work in this atmosphere are things that also have kept the company running over the past decade: weekly town hall meetings, gathering the company together for lunch each day, and emphasizing kindness and authenticity.

“Look, hard alcohol and raunchy jokes were not our culture,” Frohwein says. “Our culture is really caring about one another and authenticity, and that will never change.”

Authenticity, for Frohwein, meant announcing that Kabbage would no longer lend to businesses that sell assault-style weapons after the Parkland school shooting last year. But it also means embracing the alternative political or social views of other employees.

Kabbage’s leaders want more than tolerance from their team.

“People talk a lot about tolerance, but it’s very different from embracing differences,” says Frohwein. “To tolerate just means you don’t like something, but you put up with it.”

“We want people to embrace the differences between them and other people, versus just tolerate them.”

Their culture strategy comes with “a lot of collateral benefits from the business perspective,” according to Frohwein. Though there will be more shifts to make as they continue to grow, both co-founders say they’re committed to maintaining the same spirit that Kabbage started with a decade ago. 

“Everything that is around here is about us wanting to work in a place where we would work. For us it was important that we still want to work here,” says Petralia.

Frohwein adds: “Even though we’ve been around 10 years, I still feel like we’re at the beginning of the journey.”

Photos provided by Kabbage