2023 - Time to get back to Basics

Well its 2023. Happy New Year. I've been circling this post for a little bit now, so I figured why not just get it out there. Apologies for length, really I should put in AI, tell it to shorten :)

Firstly tho, I want to say I'm not here to gloat, or to say 'I was right' or 'Time to Listen' even. I'm writing this in part because I'm frustrated re all these layoffs. As in my mind some of them are unnecessary. And I want to stop them happening again. I see the very real pain that these cause, we arent talking about something light here, we are literally talking about people not being able to pay their mortgages. This is not a light topic. And I believe I saw this coming, so I want to just try in some small way to get us all thinking about how we step forwards into 2023 and beyond, and how we work together. I think it's preventable. But it involves courage from us all.

It's time to get back to basics, and set a better way forward. That's what I'm going to cover a little here. I hope you find it interesting, and in some small way helpful or thought provoking.

Let's set the scene 2020-2021

I think we have to see where we come from to see how we got to this place where people are losing their jobs in tech. Reflection is important.

I can only realistically look at this from the world of eCommerce where I reside, so I'm not going to even attempt to tackle beyond that. Much may apply, but I don't want to pretend to truly know.

So for eCommerce prior to 2020 we were growing pretty steadily. I'd call it a healthy market. Things were def a little frothy at times, we saw say with Magento a bit of what I'd call investor mismanagement going on that didnt help the ecosystem, but helped the pockets of the top. But you know this happens all the time. And nothing is forever.

There were definitely what I'd call 'vaporware' products built largely by PE backed businesses, but there were also lots of solid products, and not all bootstrapped, some had good investment - TaxJar springs to mind. Others like DotDigital were IPO'd and running well.

I'd say there was balance. And thats key. Healthy mix, an ecosystem. Not always happy, sometimes we fought, sometimes we got drunk until 4am in the corner bar at the wynn, sometimes we made some amazing things. But there was balance, and a shared drive (no not the google one).

I think also what I saw was generally the merchant was pretty central to us. Customer was key. We knew we relied on them, and they relied on us. We had a healthy mutual respect.

So 2020 happens. Chaos. First we think we are in a sinking ship, the world is shocked. Many of us, certainly in leadership, are in panic, not knowing where this will go. Some people literally did lose their businesses. There was this mass pivot to adjust at speed.

Just think back to then, to how you were, to that landscape. It felt like from the news (and sometimes in reality) that people were literally dying around us, and we were trying to work in what fast become and exploding space. We got super busy. The stress on us all was crazy. But we knew (and we still know) for many the circumstances were much worse. You only need to jump into a london taxi and talk to one of the drivers to see the true impact. We did have it easy, and we almost had a form of survivor guilt as a result.

2021 comes. In eCommerce its now mass expansion time. Dust seems settled, but its not really. Company sizes are exploding, valuations are going nuts, everyone wants a piece of the pie, and we can't get staff. Inflation is kicking in, so salaries are going up, we are adjusting to remote working and these rapidly growing companies. We dont know how to truly train, we have customers coming at us left right and center, and everyone wants something. Time is > money.

I remember in October 2021 sitting outside a coffee shop in Florence Italy, we were across from a designer clothes shop (Gucci or similar). I wish I had taken a pic. Every morning we went for coffee at roughly the same time, and whilst there the workers rolled up with the security guard who let them in. Their first job was emptying the boxes out ready for pickup (Florence is very small). I could not believe the sheer amount of boxes each day. One day you'd say oh thats a week of boxes. No in 24 hours they had a mass of them. Thats when I truly went okay things have got cheaper here, people are earning more. I dont believe at that time the shops had been impacted to raise prices, but I dont know, I didnt deep analyse it. It was clear to me tho that inflation was going to hit and hit us hard.

This isn't the only instance I saw, but look, when you see people coming in as engineers asking for 400-500K salary yeah you go wth is happening.

And for us at ShipperHQ

2020/2021 were 2 of the hardest years of my life professionally. I'll put personally to one side for a minute. It was hard to keep up with the rapid expansion. And hiring was impossible as a bootstrapped company. We made a lot of mis-hires, and it wasnt the fault of any person that joined, they were all fabulous people, but they were not necessarily a fit for us, or we didnt have the right person above them, etc etc. I'm sure like many companies we can acknowledge we made mistakes. Hiring in "COVID" was hard, and my paychex shows this, traditionally ShipperHQ has very high retention, during COVID it went thro the floor, and most of the people left were those that joined in COVID.

Im sorry about that, it was time lost. I could only do what I could do and I tried my utmost. Im reflection I think I sat back way too much and trusted the 'leaders' walking in. I should have driven for more accountability, I probably did have a form of imposter syndrome, and frankly I assumed if you hired people that said they could do it, well they could. I didnt provide enough of the onramp at times. But also we were all struggling to just keep a hold - that was hard as esp being bootstrapped we had to make the numbers add up. Well in an environment where no other companies are making the numbers add up then staff get pretty fed up pretty fast when you start saying no. Because they see elsewhere a lot of yes and dont understand when I might be concerned about us just blowing say 50-100K on an 'experiment' with no real test first.

Sell or Keep - a Brief Story

This is how we entered 2022. I remember sitting with some CEOs with our head in our hands. We couldnt hire, we couldnt find good talent, we were getting pressurised on wages, and the economics just did not add up. And out there we had this ongoing rhetoric around PE/investment, grow fast, spin, hype, drive drive drive, celebration celebration, but without any foundation. My staff were asking - why arent we celebrating. And I'm standing there going 'because we have our feet on the ground'. They didn't get it. They wanted it. I was an 'idiot' for not getting investment.

But I looked at it. You have to realise I'm not a spring chicken, I've been around the block. If I was 30 I'd have taken it, and I dont blame anyone who did. I often think I made a mistake not doing. But I just couldnt get it done. I could have retired. But I was working on the lowest common denominator staff, and I couldnt see how my company turning into a financial instrument helped them at that time.

Its a little known fact that I did nearly sell/get investment. We had many months of the company in disarray why we focused on due diligence. I wont go into detail, but I will say that deadlines were missed, and it was exhausting mentally. I actually decided on Jan 6th 2021 enough - I'm staying in charge. The day before I had told my team we were selling. And why didn't I sell? Well for one I could see as part of DD just how strong we were, I felt like we were worth more, and I knew I could drive that in 2021 (and incidentally I did - 58% growth). But secondly I spoke to a close friend after Jan 6 (many of my staff were distraught that day its worth saying), and they said to me 'a captain doesnt leave its ship'. It sounds corny, but its true. I'm good. I walked away from the deal that day, my lawyer said he hadnt seen anyone walk from a deal that late in process in 20 years of dealing with m&a.

I share all this not to brag, far from it, prob should have sold! I do to give some very real context from behind the 'curtain'. This is not something I've discussed openly before. But I want to share this story. I want people to know how it was as a CEO in 2020-2022. It certainly was not about money. It was about survival. And protection. No doubt there was an element of 'this is my baby', tbh tho for anyone thats breastfed there gets a point where that baby needs to latch off :) Sorry all the men in the room, you'll get over it.

Losing our Culture

Anyhow I digress. Late 2021 I had a video made by the Buzz Labs, I could see we were losing connection with each other, we were forgetting about community, about helping, about friendship. I wanted to try to restart that conversation. Why? Well it was as much for my own team as anything else. I could see as we all started meeting that we had lost some of our culture. We had forgotten how to communicate. I've posted it here, this isn't an ad, just watch it in the context of this article (and not necessarily right now!!).

It's hard for me to believe thats only just over a year ago. Shocking. Feels like a lifetime ago.

Shoptalk 2022

So for me this was my first major outing back into the ecosystem. I feel like there were a few things before but Shoptalk was as close as normal got. March 2022 from memory.

You got this sense there, and it had been rumbling, that the markets were turning.

But it was crazy also. I remember listening to these people up on stage talking about logistics and the guys looked like they were still in college, and they had NO product. It was all 'we are building this'. I had people coming upto me going "I've raised 30M and I need you to do this" and I was saying well what do you have - "Oh just an idea and 5 potential customers". I'm like wtf is wrong with you. They looked at me like I was voldemort, stamping on their idea. No it was nuts, I said to them yeah I'll build for you I need 100K to start so finance the team for a month and just know I'll be creating that team offshore for you, you arent taking any of my existing resources. Anything after the month build costs are yours. I was giving them a lesson in running a business. One of them was so I dunno either shocked or just thought it was great info(!!!) that they went and got their founders and I had to repeat this to a number of them. Yeah it was extraordinary.

I rang up my team in Shoptalk and held an impromptu meeting. If you went back on my linked in you can see it. Because like everyone at that team they were demanding - we want more money, less time to work (bear in mind we run a 4.5 day week, 22 days leave, very strict work/life balance), less responsibility etc. I'm not saying everyone, far from it, but there was very much a 'vibe' I was getting that the tail was wagging the dog.

And staff just leaving for double the salary. And trust me I dont pay bad. So I held this all hands meeting even tho I was at an event (I never talk to staff like that whilst at events as they are chaos), and my sole message was be careful this is collapsing. A job now on 200K vs 100K might look great, but if you dont have a job in 3 months just know its a problem. Likewise if you go buy a house thinking 200K is the norm I see a major reset, and its hard to dig out of that mortgage. I dont know what people at work thought. Prob 'she is an idiot'. I dont care what they thought tbh, I just hope I stopped one of them from over-committing, I just hope I sowed some seeds of 'be careful'.

As you know Fast collapsed at Shoptalk. I wont go into but that was the real start when we went hang on, this could affect us.

I know I'm laboring this history btw, but I think we need it.

And to Now

So lets jump a little. Briefly I'll say by July I had decided to really take the reins on the company. I had to. I could see that we werent putting the customer first. We had grown too fast, we were missing some building blocks. And I hadnt been strong enough to stop some of the decision making.

The rest of 2022 for ShipperHQ was both hard but also rewarding. We reset to our core values as a company. We lost some incredible people, but we also reconfigured. I believe we made striders to get back to what we are culturally, and I managed by a lot of yelling frankly to get over that this customer comes first, and the need to show up for your colleagues.

Is it perfect - no. Are we rolling forwards, profitable and growing - yes. 35% in 2022. I threw all targets out in march to reset, so I'm happy with that. And better I have a lot of ambition for 2023, and am now building out the team correctly. I've learned a lot. And as Dolly said recently it's been a lot about taking the reins and having the confidence of when to say No and being able to quantify it. Plus slowly improving accountability and metric based decisions. Always work to do.

Okay so What's the Point

I share this not to talk about ShipperHQ. I share it because I would lay a bet a lot of you have seen similar to above, but maybe its a little delayed. This is because I think people didnt pull back as soon as me, so they started to do that later on. Which is why layoffs are still coming now. That reset I went thro in July/Aug I think some of you are just starting.

Its a return to true fundamentals. The advantage I may have over you is Im in profit, and in fact I'm now pretty healthy, so I'm back to growth. But for a while I had to retract, that meant reducing my sales and marketing right down whilst I sorted other functions. I'm now back growing them. You may well be in earlier stage.

So my first statement will be dont panic. If you are out of work, or even in work. We arent in a total collapse here, and I personally am seeing a lot of metrics that point to eCommerce being healthy, people are not returning to 2019 shopping behavior like is being told to us - they definitely in some areas of the world are much more in the physical (e.g. UK), but online retail has changed and thats here to stay.

Changed Shopping Behavior

To know this you need to look at your own behavior. Not in all cases, but I'd say you learned to buy more online during COVID. I never really bought many clothes online before, or shoes, now most of my sneakers/trainers come from online, definitely for my teenage boys, and I do experiment (albeit slowly) with buying clothes online. I'm personally not massively into returns, so that stops me a little there, but I know plenty of people that do use.

Re food, I think we have come to realise we can buy online and get delivered, we have built up trust. In 2023 I see the likes of Instacart/Doordash suffering as we cut back, we will go visit the supermarket more to save on unnecessary costs, but I dont see us not buying that Jenis ice-cream. We are more stressed still than 2019, we will need things to alleviate us. I think we will be back on our fitness machines, we need to get fit (I know I am), we got sloppy in 2022 when we returned to the real world and need to reel it back.

I could go on but you get the idea. Think about how you are shopping and changing. Thats going to be how others are. And this is fluid. We are 8th Jan 2023, things may collapse here, I dont know. Adjusting and being able to pivot is key.

What will Truly Help us

We need to get back to the basics of business. Do you remember when we went to events, we had healthy conversations, we were invigorated by each other, we lifted each other, and we supported each other. Not always, there were problems, and those too were beneficial. We had candid conversations, we discussed opportunity. And were there sometimes people spinning things, but we usually sussed them and they ran in their own circles.

In short we need to get back to an ecosystem that is healthy. We arent a financial instrument, our customer is not a financial instrument. Look I'm here like the next person to do business, you spend 10 mins in a bar with me you will know I'm a business person first, technologist second. I'm not here for a rah-rah round the table for the fun of it. I'm always working. Or drunk (This is very much a joke those who know me will get).

I want to make extremely clear. I'm not knocking investors. PE/VC whatever. Or the people that get it. Or the companies, or CEOs. I was nearly there, remember that. And Ive seen a number of successes. I'm not sitting here from a position of high status preaching. I am not saying 'Im successful'. We all have our own issues, and I hope in above I've shared enough for you to see I do not sit here with anything other than a desire to change how we are doing this.

The importance of Ecosystem

I sat down with someone last year and I really tried to explain the Magento ecosystem of old. I can only really talk to this as its what I knew. 2008 I started on Magento. I went to every Imagine, by accident really, I became an OG. I ran the largest community event there towards the end - Pre-Imagine - over 700 people we had in the final year. My background before commerce I used to be that person that organised the party at work. I didnt know this at the time, but I think you could call me a connector. TBH in real life I dont think I am, I live a pretty quiet existence, my main focus is my family, and outside work I dont have a ton of time for dinner parties or great adventures with people, I just want my little family and thats enough.

But I am a connector, and I also think I get a lot of joy in others succeeding and growing. Years ago when I worked in corporate I wanted to be a trainer. I like seeing people move on from ShipperHQ and do well, and I like that in the ecosystem.

So I saw a lot in that role. I learned a lot. I spoke a lot about the ecosystem, was extremely annoying to many people, esp senior leaders, I tried to keep us afloat, I knew how many businesses were built on Magento, both merchants and techology side, and we relied and had poured our soul into this, it was important. I do not wish to labor on about Magento anymore, I am sure Shopify had a somewhat similar ecosystem, if a little younger. I also went to some Shopify Unites so did see this, but was definitely a smaller ecosystem at start, different, but also the same. As we know being first doesn't mean you stay first, so kudos to Shopify for their smart growth (and indeed with investment, proving my point).

What is an ecosystem

I gave a talk in Madrid at meetcommerce.es about the flywheel effect of ecosystem, i wont repeat it all here as you can see the video (and its fair to say I kept it light as I had a very mixed audience) but I want to go into a couple of points on it. If you dont know what an ecosystem really is then first understand that.

This is an ecosystem. How does it even survive? I havent done the resarch but its def a shock to me that over so many what 25 million years since they have been around like this - well they didnt trash each other.

Don't you think we need to strive to get more like this? Where we support each other, respect each others differences, have some balance. And yes kind of eat each other at times, thats okay, arguments are okay.

The closest thing I can show you to what is an ecosystem in balance is this film. Go watch it. You will learn from it.

How Do we Step Forwards?

Decide how you want to live. I dont want to be a coyote. I dont want to be greedy. I want to have fun, I want to enjoy the journey. I want to laugh, to make relationships, to help others, and sometimes be helped. I need to work, but I want to enjoy my work. I want stability, security, responsibility, ownership, at times control. I want integrity, I want to explore, I want to innovate, I'm not here to get rich at all costs. I want to leave the world a better place.

I believe we miss a trick. In working together. I do not wish to pick on coyotes as actually I have a weird fondness for them (we have some where I live), plus you need to see the film, but in basic form coyotes (and indeed 'cute' badgers) hunt in packs. They have got organised.

I believe in the ecommerce ecosystem we havent really got organised, and as a result we get picked off. We do not realise the power of the 'tribe'. We do not realise that if we work together more and stop worrying so much about immediate short tail wins, well then we all prosper better. Plus we feel better, we see reward for our actions, and well isn't it about time? I see a lot of, how do I word this, throwing stuff at a wall and seeing what sticks. Imagine if you did something and you actually saw the positive impact of that. How much are you seeing that right now?

Work Together, get Candid

Ecosystems need big and small, they need disruptors and big players. There are many roles in an ecosystem. You need to figure out yours, and the part you play. If you are a custodian please understand your impact. Grow up. I had to. You dont have to get it right all the time, I dont, but I understand my role here as a OG of this ecommerce ecossytem. I want to leave it better than I found it. And as much as I love technology thats a lot about people and stability. Technology is the enabler.

We need to get more truthful with each other and cut the BS. If your solution isnt ready say so. If you dont understand ask, if you dont see the ROI find it. Give yourselves permission to have transactional conversations. Be prepared to be wrong. Be prepared to say sorry. We arent here to sit around smoking joints or getting drunk - we arent. We are here to provide for our families, to provide for our staff in some cases, and to improve eCommerce, to innovate, and to live life in all of that. You have seen the layoffs. Let us not do this again.

My message to the Hype

Good luck now. I hope you fed enough. Now get out of our way, and let the real engineers go fix this. We are not financial instruments, and our customers definitely are not. I'll reject this as a way of thinking today, tomorrow and next week, next year. Let's get back to being humans. Because in this new world of AI its going to be more important than anything

Onto Tomorrow

I'm still here. I'm still standing. I hope that shows in some small measure that following basic fundamentals is the way forward. Get a good product, look after your customers, grow sensibly.

I'll say this to you all, have confidence in your gut, please go figure out how to help each other more, and stop listening to silly ideas. If it doesnt make sense it doesnt make sense. I know when I spend money I spend someones pay rise. Think like that. Understand the value of money. I dont expect you to be perfect, I'm clearly not. But together we can help lift each other, and call me utopian but I still believe in that. I believe in reality. I hope you do too.

Have a good 2023. And yes we need to shift – AI is here, embrace it – dont be scared. Trust me - we will survive, and for some we will thrive. But its time to work, and its time to get smart.

Eyes wide open, lets go. And yes, lets try get back to some fun, but please lets have real fun.

PS. No AI was used in the production of this material :)