What No One Tells You About Being an Entrepreneur

Recently, I returned to my alma mater Stanford to deliver the Entrepreneurial Thought Leaders lecture. As soon as I walked into the auditorium, I was flooded with memories of sitting in those same seats attending this very lecture series as a college student 20 years ago and feeling inspired by Jeff Hawkins (Palm and Handspring), Carol Bartz (Autodesk), John W. Thompson (Symantec), and so many others.

Hearsay’s Founding Story (2009)

The inspiration for Hearsay was based on getting a cold call from a salesperson in 2009. It seemed obvious to my cofounder and me that “dialing for dollars” was becoming increasingly ineffective. Social networking sites were nascent, but we saw that they might be an opportunity to completely change the sales process to be based more on trusted networks, establishing the salesperson as a trusted expert, and reaching out during key trigger moments.

The naming choice of Hearsay was a play on words. The "hear" part of Hearsay was for the natural language processing (NLP) mining of social media posts in the seller's network to uncover trigger events such as someone changing jobs, moving, retiring, or changing their last name (likely someone getting married). The "say" part of Hearsay described our predictive AI-powered content recommendation engine which suggests to each seller when to reach out and what to say to brand themselves as a trusted thought leader. We had a belief that every seller in the future would need to have a trusted, Google-able profile and regularly share content in order to attract prospects to want to meet with them, rather than continuously cold calling.

Today, Hearsay Systems is a trusted technology partner providing compliant social selling and text messaging solutions to the largest banks, insurers, and financial firms around the world.

Salesforce Generative AI Founding Story (2021-)

In addition to being a startup entrepreneur, I’ve also been fortunate to start something from “zero to one” at Salesforce , a company with more than 70,000 employees. After 11 years as CEO of Hearsay, I experienced major burnout and took a personal sabbatical in 2020, moving into a board chair role. Later that year, I joined Salesforce (where I’d worked prior to starting Hearsay) as CEO of Service Cloud, the company’s portfolio of customer support products including the service agent console, digital channels, voice, chatbots, and field service.?

In 2021, a year before ChatGPT was launched, Salesforce’s Chief Scientist Silvio Savarese and I began working with Gucci to help their service representatives respond more quickly and accurately to customer inquiries using an early large language model.

We were amazed to discover that the AI not only resolved customer issues faster but also enabled their service team members to become product experts and sellers. When ChatGPT took the world by storm a year later, there was suddenly demand for a trusted, secure way for enterprises to deploy generative AI. Thanks to our project with Gucci, we were ready! I've been able to build a new AI organization from the ground-up, focused on building our next-generation AI platform and apps.?

Salesforce AI feels like a startup within a 70,000-person organization. We shipped Salesforce's first generative AI products last summer and recently delivered our new Einstein Copilot and generative AI platform called Einstein 1 Studio– all in record time for such a big company. I always say we move at startup speed but at enterprise scale and with enterprise trust.?

For the Stanford lecture, I focused on eight lessons I learned during my experiences founding Hearsay and Salesforce AI.

Lesson 1. As entrepreneurs, we’re told to find product-market fit (PMF) as quickly as possible, but sometimes PMF finds you.

When Steve and I were starting out with Hearsay, we had this great idea of lead generation (“hear”) and?content prediction (“say”), and we were convinced this would be perfect for real estate agents. We called every real estate company that we could find, sponsored realty trade shows, and talked to our friends who are realtors and made them try our product. (As an aside, don't read too much into friends telling you that your product is good-- they just don’t want to hurt your feelings. Not until someone pays and doesn’t cancel should you take that as a sign you’ve found PMF.)

Despite our early conviction, nobody ever seemed to call us back or have urgency around signing a contract. That is, until one day, coincidentally an insurance executive who happened to attend a real estate event we were at became interested in what we had to offer. In fact, they kept calling until we agreed to tweak our product for insurance. They issued an RFP just for us, and we sold our first $500,000 deal, then our first million-dollar deal, and then within a few years we had captured almost every insurance company in North America. Then we expanded to Europe, then Asia, and to this day Hearsay remains a powerhouse in the insurance industry. Sometimes you have a plan and think you know exactly what you're looking for, but it may not always play out as you expect. You have to stay open-minded or you might miss the opportunity.

Lesson 2. Don’t listen to your customers.?

This is the classic Henry Ford quote that if he’d asked his customers what they wanted they would’ve asked for a faster horse (though historians are now saying that there's no record of him ever having actually said this). Nevertheless, I can confirm that you in fact shouldn't always listen to your customers.

I’ll never forget the day that Steve and I flew into Boston to meet with a marketing director at a Fortune 500 financial firm. We were right in the middle of pitching Hearsay’s software, and she cut us off. She said, “OK, I get the content recommendation and importance of getting our financial advisors branded as credible experts on social, but tell me – can you increase the file storage capacity on my laptop?”?

We were taken aback and asked, “What? Why do you need more storage capacity and how does that have anything to do with social selling?” She spun her computer around, and we saw seemingly thousands of overlapping screenshot icons on her desktop. We asked her what the deal was, and she said, “Well Clara, something you might not know is in highly regulated industries, anything that a salesperson shares with a client or prospective client has to be captured and surveilled according to a slew of regulations.” It turned out her job was to go through each one of their 2,000 financial advisors’ social media profiles every day, screenshot them, and then submit it in a regulatory filing. Steve and I left her office feeling both horrified and also inspired. We knew we could automate this using Twitter and Facebook’s APIs. At the time (2010), LinkedIn didn't have an API, so we found a dozen more financial institutions, made a business case, and pitched LinkedIn on the importance of exposing an API and working with us if they didn’t want to forego the massive addressable market of regulated industries. It worked, and the rest is history. The lesson is don't just listen to your customers, because sometimes what they're trying to solve for should be addressed in a completely different way.?

Lesson 3. Early hires set the company culture.

The first few dozen people at a startup set the tone, pace, and quality bar for the rest of the company’s trajectory. Hiring A+ players is so easy to say and so hard to do. In the moment, you’re understaffed, drowning in work, and needing to have hired these people yesterday. It's tempting to tell yourself, “A warm body is better than nobody, and I'll replace them later when I’m less under water.” Except that it's not so simple, because those early people set the culture– from big things to little things, like what time to show up for work, how ethical and responsive to be, whether to be customer-centric, how high to set the bar, the list goes on.?

After we moved out of Sequoia, we got our own office near South Park in San Francisco and took over space from a startup that had run out of money. They left some broken chairs but no desks. We searched around and realized we could either wait 30 days for “real” office furniture to get delivered or respond to a Craigslist ad and pick up a nice conference table for $50 that all six of us could sit around. The catch was it wasn’t in the greatest part of town, and we didn't have a pickup truck. In the end, we got the Craigslist table, hauled it back, and it became a symbol of Hearsay’s “get stuff done” mentality and ethos of treating the company's money like your own, which persist to this day 15 years later.

It’s been the same with the early team of Salesforce AI. A 70,000-person company doesn’t usually move as quickly as you need in order to compete in the fast-evolving space of AI. But within our AI group, team members have set the bar really high on work ethic and work quality, working nights, weekends, and holidays in order to ship in record time. The culture which has been set is self-reinforcing, determining who gets hired onto the team, what team members expect of one another, and the pace of execution.

Lesson 4. Don’t give up the ground game as you scale.

Bob Sutton , a professor in the Stanford University Department of Management Science & Engineering Department, helped me learn this as I was trying to unwind what had gone wrong at Hearsay circa 2015. When your startup is 10 people, you’re spending nearly every waking moment together and everyone knows each other. Even up to to 25, 50 people, you know people's kids, significant others, hobbies, pet peeves. Then one morning you wake up and you have hundreds of employees and can't possibly know everyone.

When this happened at Hearsay, I made the mistake of shifting from operating in this very personal way– playing the “ground game” – to suddenly air dropping messages to the whole team. I thought I could send a team email or blast a decision over Slack– just play the “air game”-- and everyone would get it and be on board. Well, it doesn't work this way. Our culture went sideways. People who we hadn't properly onboarded with our culture and aligned with our company values started being the ones to interview and hire others, and the problem grew exponentially until one morning, I looked around at my company and didn’t recognize it. I had to roll up my sleeves and get back into the heart of the company one leader, one team, one course-correction at a time.?

Especially when the company is bigger, employees need to be thoughtfully engaged and feel personally connected to the company mission and key decisions. As often as possible and for as long as possible, stay focused on the ground game to make the company feel as small as possible so that no one feels anonymous. At Hearsay, I started doing new hire breakfasts and every class of new hires would get together. and it's a way of breaking down a big group into a small group. It’s the Margaret Mead quote: “Never doubt that a small group of thoughtful, committed citizens can change the world. Indeed, it is the only thing that ever has.” The same is true about small groups of thoughtful, committed employees in companies. Make it your job to make everyone feel connected, engaged, motivated, and accountable.?

Lesson 5. The hardest part is deciding what NOT to do.

The hardest thing about entrepreneurship and life isn't figuring out what to do– it's figuring out what NOT to do. There are many distractions and false prophets like fear and ego. It’s especially hard as a first-time founder to figure out how to manage your time, energy, and endgame. Often much of what we spend time on can feel like work but is actually busy work or work that could be delegated.?

Common culprits:?

• Scope creep. It’s hard to stay focused when you're a startup trying to achieve product-market fit and have revenue to show. In 2009, we had a vision and early product for social selling but no revenue. Other social startups at the time were focused on social marketing. One day, 可口可乐公司 reached out and said Hearsay was on their short list of vendors for social advertising. It was tempting to try to win that business, but thankfully we knew it would spread our team too thin and had the discipline to say no.??
• Small rocks instead of big rocks. There are inevitable fires once you launch. You'll have bugs, customer requests, the list goes on. As my fellow founder friend Selina Tobaccowala advises, you have to learn to let small fires burn in order to focus your scarce resources on putting out the biggest blazes and going after the most strategic opportunities. This is hard to do, especially if you're used to being a high-functioning individual contributor (which is pretty much everyone I’ve met at Stanford). Sometimes the distractions aren’t even fires; they are micro-decisions that add up and create cognitive load. Steve Jobs famously wore the same outfit every day so he wouldn't have to waste mental energy thinking about it. For me, moving my residence to the same block as my office allowed me to never have to worry about traffic, knowing that I could walk to work every day and that it was predictably 3 minutes and 22 seconds.?
• The conference circuit. Another focus pitfall is the never-ending conference circuit. Once you raise funding and get put on these Fortune and Forbes lists, you’ll start getting invited to speak at media conferences, venture capital retreats, investment banking conferences, and an endless number of other events. It’s flattering and fun, but if you’re not careful, you could end up like I did spending way too much time at conferences and not enough back with your team, customers, and product.?

Lesson 6. People want to help– you just have to ask!

Starting a company is like swimming upstream– like pulling an entire steamboat upstream through choppy waters. But you don't have to do it alone. There are many people who want to help and want you to succeed. A great example is Jon Sakoda , who led Hearsay’s Series B when he was at New Enterprise Associates (NEA) (now founder at Decibel Partners ). Jon prospected for us, met with customers when we were booked, interviewed candidates, even had his team build decks for us.

Caroline Feeney , CEO of Prudential US, is another wonderful example. Prudential started out as a customer of Hearsay’s social selling product. One day when we attended a conference together, Caroline said, “Why don’t you offer Hearsay for text messaging? I'm seeing financial advisors and clients starting to text constantly, and they need the same compliance coverage that you provide on social media.” We listened to her suggestion, and now our texting product (called Hearsay Relate) is our fastest-growing product line.?

Lesson 7. Entrepreneurship is lonely, and you might not have time to establish deep friendships.

So much happens in a startup, and there are so many fires. Usually the founders become the backstop for everything. There are many perks to being a founder, but it does get stressful and lonely. Your schedule gets hijacked when a big RFP gets issued, when you're about to run out of money, when a prospective large customer is coming into town and wants to meet you for dinner. I found all of this made it hard for me to show up as a good friend, and I really didn't make new deep friendships during the 10 years that I was running Hearsay. I’m very lucky that I went into my startup with close lifelong friends who I met in high school. There are an embarrassing number of supposed vacations that Ally, Becky, and I went on together where I never left the Airbnb because there was a fire at Hearsay. I think if I'd just met them, any normal person would not want to sign up to be friends with such a flaky person as entrepreneurs who put their startup first can tend to be, but because we’d already been friends for 15 years, they supported me through my entrepreneur journey. I’ve realized succeeding with a startup isn't just about your product, technology, or team. It's about the founder’s mental health, physical health, and stamina. Almost everything else, you can fix but if you’re feeling burned out or unsupported, then all bets are off, and it sure helps to have some great friends to support you along the way.

Lesson 8. Reinvent your job and re-interview yourself every six months.

The last lesson is that you need to scale and reinvent yourself at the pace at which your startup is growing. My fellow founder friend Bob Tinker has this great metaphor that in the early stages of going from “zero to one,” you start off as Davy Crockett, hacking your way through the forest and doing whatever it takes to blaze the trail. Often it helps to be a jack or jill of all trades. Once you get those first few customers and/or raise your first round of financing, you grow to leading a band of superheroes and the job is more like Joan of Arc or Braveheart leading from the front and rallying the troops. At some point, your company grows to be 350 or 500 people or 10,000 people, and you have to shift to playing more of a strategic architect / orchestrator role, building systems that allow you to manage managers of managers of managers of managers. You have to be a leader who plays both the ground game and air game.

For me, after 11 years of the startup journey, I realized that I was no longer fit for the job, so I transitioned myself out of the company into a board role and passed the torch on to our COO Michael Boese .?

In closing, entrepreneurship will change your life. You'll do harder things than you ever thought possible and only through doing those hard things can you actually find courage. It's that courage that changes you, and will cause you to live your whole life differently from that point forward.

Thank you Stanford Technology Ventures Program (STVP) for hosting me!

Some ETL classics:

• Changes in Enterprise Software, John Thompson, Symantec Corporation
• How We Attracted Our First People, Max Levchin and Peter Thiel , Paypal (January 21, 2004)
• Know Thyself and Niche Thyself, Guy Kawasaki , Garage Technology Ventures (October 20, 2004)