Make executive hires that are stage-appropriate for your company
Pre-IPO, be careful to balance growth with efficiency
Be unambiguous with C-suite roles and expectations
Take a parental leave and encourage employees to do the same
As a consultant at McKinsey in the early 1990s, Dan Springer was convinced the internet was merely a passing fad. Little did he know that he’d end up immersed in a career at the helm of some of today’s most successful cloud companies.
In 2004, Dan re-founded Responsys. The company had originally launched in 1998, but it has shrunk down to 75 employees and revenue was taking a nosedive. Dan stepped in to rescue the company from bankruptcy. He drastically reformed the company’s fate, leading it to an IPO in 2011 and an acquisition by Oracle for $1.5 billion in 2013.
But on the heels of such spectacular success, and with Silicon Valley recruiters offering him his pick of their hottest pre-IPO gigs, Dan hit pause. “To be blunt, I wasn't doing great,” he says. “I just felt stretched all the time.” He left the workforce and spent the next four years as a stay-at-home dad to his two teenage sons—not missing a single opportunity to cook dinner or attend their lacrosse games.
After the kids were off to college, however, he missed the challenge of leading a company and decided to step in as chief executive at DocuSign in January 2017, where he remains today. The following year, he led the company to an IPO. Today DocuSign has more than a million customers in 180 countries, and is worth an estimated $44 billion.
In this conversation, Dan shares how to make the right hires when budget-strapped, what he wishes he’d done differently pre-IPO, and why his four-year stint as a stay-at-home-dad was the best career decision he ever made.
Dan likens hiring an executive team to building a stereo—if you can’t afford top quality components right away, you start with something functional and upgrade as you go. “In an early stage company, you can't just land six all-star executives to join your team because you haven't shown enough traction yet,” he says.
In his early days at Responsys, he knew he had to replace the entire C-suite. But he was budget-strapped, and also wanted to minimize the disruption for employees adjusting to the new guard. So he rebuilt his executive team slowly over a year and a half, sometimes making hires he knew weren’t going to be the ones to help take the company to IPO, but were talented enough to be the best solution in the short term.
Dan remembers hiring an engineering leader who he knew from the outset would be best-suited to a two to four year run with the company. He stresses that being clear and candid about the long term plan is the best way to make the transitions smooth and mutually beneficial. He also points out that many leaders have a growth stage that they specialize in—for example, early stage pre-seed ventures.
When the company makes a stage-appropriate hire and the hire’s needs are in alignment, it can be a beautiful arrangement. “It’s okay to say this isn't the person that's going to take us to $500 million in revenue,” says Dan. Their mission is to help us get to $15 million and then we will gracefully part ways.”
Before taking Responsys public, Dan got advice that initially offended his sensibility as a business person. Fellow entrepreneurs would tell him to start losing a lot of money, literally joking that he should just “bury it in the backyard.” Since public companies are bound to radical transparency about numbers and must show consistent growth, hitting the market with too lean margins could end up boxing leaders into a wickedly high bar for success.
Having now experienced two IPOs, Dan concedes he may have received sound counsel from those entrepreneurs. While he remains firm that leaders must act with integrity, he now believes that the six to twelve months before an IPO may be an ideal time to place some longer term bets that may not bear fruit until later. “Maybe do a little branding campaign, maybe do a few projects where you're not expected to deliver immediate and measurable results,” advises Dan.
“If these bets work out, they’re dynamite for your long term growth,” he says. “But if they flop, it does give you a little bit of coverage in the future.”
When growing a business, many founders are so focused on finding the right people that they lose sight of the need to define clear roles and expectations once they sign their offer letters. “My best advice is to be unbelievably clear on the role you're bringing in and how it's going to change,” says Dan.
If you’re bringing on a chief operating officer for example, Dan recommends thinking through the organizational chart around them—whether you’re adding a level above your executive team, having them report to the board, or any other arrangement you see fit. Otherwise, Dan says you may be unintentionally setting them up for failure. Instead, you must clearly delineate roles and responsibilities as early as possible—ideally in the interviewing stage. “Whatever you do, don’t leave it ambiguous,” he says.
“Most of the issues I see are caused when people are too polite to bring it up and be explicit about the nitty gritty,” he says. But this will kill you.”
Dan considers his role as a father to be his greatest career accomplishment. He believes that to be a great leader, you need a firm sense of what’s important in life—beyond just the confines of your office walls. What’s more, Dan says that the skills you develop as a caregiver will serve you greatly as a leader and mentor.
And he also points out that, while he’s gotten praise and media attention for his decision to pause his career for fatherhood, making a similar decision is considered wholly unremarkable for his female leader counterparts. “My feminist friends say if I were a woman, nobody would be asking me why I paused my career at its height. They say, ‘Well, you should have been staying home with your kids anyway, at least a little bit.’ As a dude sitting here, we should be aware we have these biases.”
Now Dan can’t unsee the double standards that plague career-oriented women. “Feedback is truly a gift,” he says. “So thank you to all the women and men in my life who are great feminists and have helped educate me in areas I was missing.”
Both his personal experience and burgeoning awareness of bias prompted him to do things differently as the leader of DocuSign. He created a parental leave program that guarantees all employees who become biological or adoptive parents six months of paid leave. “I hope everyone copies it. If you're a founder out there, take away my competitive advantage. Offer this to your employees,” says Dan. “They will love you, and you'd be amazed how quick it’ll transform your culture.”
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