HubSpot CEO stirs tech startups at MassChallenge

HubSpot CEO Brian Halligan shared his unconventional business advice with a group of tech startups at MassChallenge boot camp in Boston.

HubSpot CEO Brian Halligan shared his unconventional business wisdom with a group of entrepreneurs on June 27. Credit: Megan Anderle

Brian Halligan, CEO and cofounder of inbound marketing company HubSpot, said his company doesn’t have an employee handbook like most companies do. There is but one policy his employees must follow: Use good judgment.

If someone stripped off all their clothes in the office, “what we won’t do is make a policy that says ‘no full frontal,’” he joked at a June 26 event for technology startups. “You don’t want to punish many for the sins of a few.”

Halligan offered his best advice using sharp humor to 128 startups at MassChallenge, a series of events that provide mentorship and networking opportunities for entrepreneurs. The session Halligan spoke at, dubbed a “boot camp” by its planners, centered on building company culture.

Linda Stewart, CEO of Interaction Associates and former entrepreneur, explained why startups need to have culture in mind as they build their businesses.

“Culture eats strategy for lunch,” she said. “No matter how good a business plan is, you need to pay attention to culture from the very beginning, and as leaders, you have the power to decide what you want the culture to be.”

Halligan informed the bright-eyed tech crowd of his professional, sometimes contrarian, beliefs as the founder of one of the world’s fastest-growing software-as-a-service (SaaS) startups, which has more than 700 employees and 11,000 customers.

Why it’s OK to not come to a consensus

Before Halligan took center stage, entrepreneurs discussed how they make decisions. One audience member said members of his team talk about decisions until they can reach a consensus. Compromises are made until everyone is happy.

Halligan bucked that method, telling the group that “consensus is a startup killer.” At HubSpot, Halligan listens to his employees and customers but doesn’t take everyone’s advice.

“At the end of the day, I’m going to make a decision, and I don’t want to hear about it again; that ship has sailed,” he said. “It’s torture when your management team fights it and fights it.”

Too many compromises can destroy a company’s ability to innovate, he contended.

“We want to be as aggressive as possible and make a unique set of decisions,” he said. “Consensus decision-making is very dangerous.”

The importance of transparency

Some 15 percent of the startups at the event are in stealth mode — meaning they lack websites and social media pages and haven’t been openly marketed — to avoid people stealing their ideas. Halligan said stealth mode is the wrong approach for new startups. Being highly visible online, especially with smart content marketing, is essential to establishing reputations.

“You have a hard enough time convincing your buddy to join the company or a cousin or an uncle to invest,” he said. “If you think you’re gonna come out of stealth mode and a ton of people will copy your idea, you’re wrong.”

Halligan recommends new businesses have websites, blogs with thoughtful content related to the niche, Twitter accounts and completed LinkedIn pages.

On hiring and firing

Halligan said he usually gives new hires six months to adjust to his business, but if they aren’t meeting performance standards, he pulls the plug.

“Firing is never fun, but once you have in mind you have to fire someone, you just have to do it,” he said, adding that 20 percent of HubSpot’s sales employees and 5 percent of its entire workforce is laid off each year typically.

In the early days of HubSpot, the company used mostly contractors, who worked for six months before they were brought on staff. This worked out well, he said, because it gave freelancers and the company a chance to try out the business relationship.

An important part of work culture is feedback, Halligan said. This way there are no surprises for employees. Feedback is especially significant as startups scale up, he said.

“Everyone does stuff that’s messed up,” he said. “Don’t play patty-cake; give them real, raw feedback.”

Jonathan Thon, of the startup Platelet Biogenesis, which is developing a device to help people produce platelets, said he found Halligan’s lecture thought provoking.

“We’ve been thinking a lot about culture with regard to transparency and direct feedback,” he said. “We want people to have ideas and run with them.”

Megan Anderle
Megan Anderle is a journalist based in northern New Jersey who writes about technology, business, and sustainability. Her work has appeared in The Guardian, Forbes, and The Record.
Megan Anderle
Megan Anderle
Tags: Business,Entrepreneurship,Tech Culture