Home People How We Work: Pendo Finds Success By Scaling A ‘Startup For Adults’ Culture

How We Work: Pendo Finds Success By Scaling A ‘Startup For Adults’ Culture

by Holly Beilin

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

Until 2014, Pendo, a rapidly-growing SaaS startup recently named both a LinkedIn Top 50 Startup and a Top 10 startup to watch by VentureBeat, had a California address on its website. In a blog post, founder and CEO Todd Olson admits that address was one that he “had never seen or visited.” Since its founding in 2013 and to this day, Pendo has been headquartered in Raleigh, North Carolina.

“There have been periods throughout our history and some situations where there’s no question that it’s harder,” says Olson on being one of the fastest-scaling startups in Research Triangle Park. Pendo, a platform for product teams to gather and analyze data on all aspects of the product experience, more than doubled with about 100 new employees this year.

Despite all the accolades they’ve received and seeing 400 percent revenue growth year over year, Olson says his greatest accomplishment this year is how, throughout that explosive growth, they have managed to maintain and scale their company culture. He calls Pendo a “startup for adults”, where values like transparency and honesty are paramount.

Olson says the Pendo employee experience begins with new hire onboarding, where the company prioritizes providing examples and training around each of their core values, and extends to their all-hands meetings, quarterly retrospectives, and eventually, to their “maniacal customer service” (that’s another core value). This intentionality was reflected in their designation as a Best Place to Work by the Triangle Business Journal — and, according to Olson, has helped them recruit talent from not only the Triangle’s best universities, but outside the region as well.

That random California address was removed from Pendo’s website three years ago, and embracing their southern roots are now ingrained in company culture. Olson shares more on how their position in Raleigh is a unique strength, where the company is headed in 2018, and ultimately, what it’s really like to work at Pendo.

You’re coming off a very high-growth year. Can you talk about some of the things you’re most proud of?

It was a great year and I’m certainly proud of the team’s execution and growth. Generally speaking we have been tripling our business over the past two years, so there’s no question that is exciting. We got awarded a top startup award by LinkedIn, and that was incredibly exciting — if you look at that list, the first couple of startups are companies we’ve all heard of, Uber and Slack and all. To be deemed to be even in the same list as some of those amazing companies is obviously rewarding and compelling.

But if I step back and think of what I’m probably most proud of, it’s really how our culture and our people have evolved this year. One of the awards we got was the best place to work and we did that in a year where we added almost 100 people. Culture is one of those things that takes the entire company to be great at it, and that, if anything,  is probably one of my proudest achievements of last year — that we managed to scale our culture and do it in a way that leverages everyone here.

Let’s say you’re describing Pendo’s culture to a potential recruit. What are the core characteristics that you would talk about?

I think one of the best phrases I’ve heard Pendo described as is a ‘startup for adults’. To break that down, the first thing is that we treat everyone here like adults, and part of that is being very transparent with what’s going on in the business. Often you’ll see companies that feel their people can’t handle the truth. Here, our team knows everything that’s going on — from what our cash position is to when we’re hiring new executives. Even when we did an acquisition earlier this year, we announced that internally over a month before we announced to the public. What it means to the team is that we trust them — we trust them with secrets, we trust them with confidential information. I think what you get back from that is a culture where everyone is more empowered to make decisions on their own. We have seven core values and transparency is a huge part of it.

Another [core value] is honesty, what we actually call ‘brutal honesty’. When you hear the word brutal it evokes all these different reactions, because brutal is generally a negative word. We’ve debated internally if we should change it, soften it, and we almost did on several occasions. But I think as long as its used in a healthy constructive way, people generally really appreciate it. They appreciate the candor, the ability to talk to their boss openly when they disagree on a decision. Again, it’s all about empowering people to make sure that everyone is focused on what’s best for the company, rather then what is comfortable to say or polite to say. That’s a huge part of our culture.

Has that brutal honesty principle ever been hard? 

It’s hard in multiple ways. About a year ago we hired an HR consultant to come and do anonymous interviews and we came to learn that a few people were abusing brutal honesty, using it to talk about people’s appearance or being a little too hard on people. That was tough to hear; I would never have thought that something like that would get abused, because that was never the intent. But you realize that when you scale a culture, you get new people in all the time who weren’t around when these things were first created, so their interpretation is different than yours.

So what we did was we invested a lot more in training around this concept. At every town hall we started highlighting examples of brutal honesty that matched the intent of what we were going for. After doing that for almost six months, we felt like the culture started self-correcting.

It also changed our onboarding process. Now in new hire orientation I spend a good amount of time on core values — we talk about examples, what’s right and wrong about each value, we try and eliminate the interpretation.

Has the onboarding and training process helped you as you went through that huge growth period? 

Oh, it’s been huge. One of the other interesting lessons I learned is, as a founder, you’ve been there since day one. You tend to forget that when you’re adding 20 to 30 people a quarter it becomes even harder, because there are so many new people that at any given time, a good chunk of the company is brand-spanking new.

Every quarter we do a retrospective where we ask the entire company what’s working, what’s not working, and we come up with two or three things that we want to fix next quarter. Onboarding kept coming up as an issue, and at first myself and my cofounders were like, this isn’t that important; let’s make our product better or focus on our customers.

But it just kept coming back, so we put a team on it. Since then we’ve made a number of adjustments and gotten positive feedback on those adjustments. We now continually check in on each class to make sure that it is delivering and adding value; we’re constantly honing it. The other big thing that we’ve done recently is we’ve been more intentional around start dates. We’re trying to align people to having a similar start date so you create this class mentality. You get a peer group that you can lean on. That’s helped a lot.

How do you see your ‘startup as a business’ mentality reflected in your client interactions and in your success as a business?

I read this quote recently from Simon Sinek and I’ll paraphrase: it’s hard to make your customers love you if your employees don’t love you.  I think that sums it up really well. If you have a culture where people are excited to come to work, that feel empowered, that genuinely care, and then you focus them around a mission and a vision of helping customers, those customers get amazing support and we get amazing success. One of our other core values is around ‘maniacal customer success’ — it’s just baked into our culture.

That comes from the top. It means that I personally spend a good percentage of my time with customers, not reading executive level briefings, but literally in the trenches. I read support and try to respond to individual customer inquiries from time to time.

Raleigh, where you’re headquartered, has recently received accolades as a next “top tech hub”. How has your experience been building and scaling a startup in the Triangle area?

By and large it’s been great. There have been periods throughout our history and some situations where there’s no question that it’s harder. While we were getting a lot of accolades, the amount of venture capital deployed in this region is still significantly less. So in the early days we had some very stressful times where we needed capital to grow and it would have been easier if we were not in this area. That was tough.

The other area that makes it a little tough is attracting really experienced executive talent in our market. At our scale now we’re able to attract people to this region, but that wasn’t the case early on. The reality is there aren’t 25 other Pendos in town that I can pull talent from, so we need to pull talent from outside the area and convince them to move. And the third challenge is frankly a personal challenge. The Bay Area is still the Bay Area — we have to be there. Many of our customers are there, our investors are there, our partners are there. I went three weeks in a row to the Bay area in October. That is painful on your body, it’s hard on your family, it’s hard on your life. I would travel less if we lived there — it’s a fact.

But I like where I live. And we do have an amazing life. I think we can attract great people here. For engineering talent we’re able to attract best-in-class talent. I wouldn’t change a thing.

What are you looking forward to in the year ahead? 

The measuring stick for companies like us, always, is growth. Ultimately we’re trying to become a category leader in what we do. What excites me is we’re starting to see more pull for our products outside of technology companies. We’re talking with large retail players and financial institutions and insurance companies that are starting to see more broad market applicability for what we do. To me that’s incredibly exciting.

We’re going to continue to grow — I think we’ll cross 200 people this year. We’ve added a lot of executives in 2017, that was a huge focus for us. So now it’s about filling in the needs. We’re planning on moving into our new headquarters in early February, new facilities that will support growing up to 400 people. That’s incredibly exciting.

This interview has been condensed for clarity. Photos by f8 Photo Studios

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