Lessons in leadership | Scaling an org, developing yourself, and tactical management advice | Jack Altman (Lattice)
Episode 98

Lessons in leadership | Scaling an org, developing yourself, and tactical management advice | Jack Altman (Lattice)

Jack Altman is the co-founder and CEO of Lattice, a people success platform for building engaged, high-performing teams. Lattice has raised over $330M, and was last valued at $3B. He is an expert in building company culture, and wrote a book on the topic, titled: “People Strategy”.

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Jack Altman is the co-founder and CEO of Lattice, a people success platform for building engaged, high-performing teams. Lattice has raised over $330M, and was last valued at $3B. He is an expert in building company culture, and wrote a book on the topic, titled: “People Strategy”.

In today's episode, we discuss:


Jack’s book: https://www.amazon.com/People-Strategy-Culture-Competitive-Advantage/dp/1119717043

Jack’s company, Lattice: https://lattice.com/

First Round Capital's Newsletter: https://review.firstround.com/newsletter

Where to find Jack Altman:

LinkedIn: https://www.linkedin.com/in/jackealtman

Twitter: https://twitter.com/jaltma

Where to find Brett Berson:

Twitter: https://twitter.com/brettberson

LinkedIn: https://www.linkedin.com/in/brett-berson-9986094/

In this episode, we cover:

(2:40) Founders must continually grow with their company

(7:23) How to identify hiring errors vs management errors

(9:46) Managing the tension of delegation vs control

(11:51) How to cultivate self-awareness

(14:59) The one thing founders should never give up

(17:22) How to build a product org

(19:06) Hot take on micro-management

(21:05) The importance of context setting as CEO

(22:09) What founder transparency actually means

(23:43) Examples of “context setting” as a leader

(26:09) The value of uncomfortable conversations

(27:16) How to have uncomfortable conversations

(28:30) Founders must own their most difficult decisions

(31:48) Optimizing speed vs accuracy in decision-making

(33:50) The hidden biases in group discussions

(35:05) When Jack experimented with removing himself from all meetings

(37:48) The most unusual element of Jack’s leadership approach

(38:34) 4 pieces of advice for CEOs

(41:20) How to talk to customers

(42:59) The many sources of learning for CEOs

(46:45) Instructive framework for maximizing employee performance

(49:56) When long-time employees don’t scale with the company

(55:07) How to think about low-performing but “well-liked” employees

(58:19) Identifying team members that “aren’t a fit”

(59:57) Should you tell people why someone was let go?

(62:42) Managing in the challenging new economic environment

(68:18) Aligning an employee’s career goals with company goals

(74:27) You're probably underestimating your team's potential

Brett Berson: So I thought one place to start would be to talk about your own journey from founder to CEO over the last seven plus years at Lattice. And I'm curious, like how would you describe the sort of different chapters and things that you've figured out along the way? 

Jack Altman: So, seven years is a long time. Uh, there's a lot of sub journeys and all of that.

And I think this is one of the big things that a founder has to go through is that the change in yourself that you need, uh, is uh, it's very frequent, it's very substantial. And what's right in behavior for me now with Lattice at 600 people would've been wrong at 60 and the way I operated then would've been wrong at six.

And so part of the mental, uh, you know, place you have to get yourself to is understanding that the way you operate really has to change dramatically. I think something a lot of founders experience at the beginning is that they can really operate through their own force of will, and you can really put your hands on each part of the company.

You can hero sort of, uh, mode your way through problems that you have. You can uh, you can go talk to extra customers, you can jump into the Figma files if you need to design something. And then reasonably quickly what ends up happening is now you need to lead a group. And so somewhere around 10, 15 people, you go from this early stage founder to, for the first time becoming a manager and a leader.

And you know, something flips where now the way that you can affect the most change is by, uh, impacting more people a lower percent than just doing everything yourself, you know, like for example, I can push my way through something very hard when there's only six things to do, but when there are 60 things to do, I'm better off inflecting a group of 15 people by 20%, 30% each.

And so that's one of the evolutions that happens. But then as the company continues to grow, as you get to the next break points, and as you get to a point where you say, okay, now I need real executives and now I need to manage a more senior level person, things change when you get to your first moment of managing managers.

And now I've gotta think, well, I'm not just managing the head of sales, but I'm, uh, who's managing, you know, sales reps, but I'm now managing somebody who's gonna be leading different groups. And then how do I think about that? Uh, it really does require, uh, continual reinvention. I would say. I guess directly to your question, you asked about sort of like, what changes have I experienced recently?

Um, one that I can speak about for me is, and this is personal and stylistic Lattice in the early days had a culture that was, um, What I would describe as very consensus driven, very inclusive in terms of the way that we came to conclusions on ideas. Um, we really got to places as, uh, groups and I think that actually worked really well for us in the early days.

There were hu- there's huge amounts of trust that you have when the team is small. Uh, people really know one another. You don't have to navigate your way through bigger groups. Uh, something that I've had to change recently is as we've scaled to hundreds of people, is realizing that the trade off of doing that is massive lack of clarity, massive lack of efficiency.

And so what that means for me as, uh, CEO is needing to increase the degree to which I'm comfortable being more directive, being more clear, setting firmer boundaries on expectations of roles, uh, and things of that nature. But that's the example of the last couple of years. But it changes all the time for everybody.

Brett Berson: So how do you figure out as you're kind of growing the business, in what ways you have to change in sort of each one of those chapters? 

Jack Altman: Some of it is you are watching yourself fail in real time in lots of different ways. You're watching stylistic behaviors of yourself just not work or come at great cost.

And so to me, one of the most important things that a founder needs that really anybody needs, but just speaking on behalf of founders, you really need a very acute self-awareness and willingness to hold up a mirror and say, I am responsible for everything that's going on here. And if things aren't going the way I want, I need to first look at myself and think, is the way that I'm operating, the way I'm choosing to make decisions, uh, is that not working well?

But as a CEO you end up making so many decisions all of the time, and so you actually are getting really rich feedback loops and you get fast feedback loops. It's like, you know, the opposite of, you know, venture capital where you like, you know, make an investment and then you have to wait 10 years in. In a startup, you often, you know, make a decision or you behave a certain way in a meeting and you know, in an hour or you know, in a week, uh, how this is going or certainly over the period of months. And so a lot of this is observing yourself from an outside lens as much as you can to just see what's not working and then, uh, look to adjust.

Obviously most of us are gonna need outside support, whether that's through, uh, sort of peer founders, people who are stage ahead, a coach, whatever. Uh, boards can be great for this. But yeah, ob- observing yourself failing in real time is kinda the best. 

Brett Berson: I think one of the tricky parts about that is that if there's some problem, and we could go through a scenario, but if there's some problem, it's often hard to know if it's a you problem or if it's the individual.

And I think most scaling founders they first go to, it's not working because I made a hiring error as opposed to the way that I'm operating or running the team. Do you have thoughts on like, how do you disambiguate that or kind of get to some root cause? 

Jack Altman: This is a really tricky one because a lot of times you don't know, and a lot of times somebody who is successful in one mode of operation is not gonna be successful in another.

So you might've actually made a great VP of engineering hire, but you're only going to be able to make use of that person if you operate in a particular way. Or if you put them in, uh, tension with product in the correct sort of way, if you empower them in the right sort of way, if you've assigned the right sort of budgeting, the right decision making.

So, so much of it is, is around the setup as well as just the individual. And so, uh, generally speaking, what I would say is before deciding that you have got the wrong person, unless you're absolutely sure, but before deciding that you've got the right, the wrong person, you should quickly test multiple modes of operating.

And this is one of the things that you need to develop as a more experienced, more senior leader to company, is you can't just manage everybody the same. You actually have to, uh, develop chameleon skills where depending on who you're managing, you operate differently. You give different people different, uh, sort of constraints.

Uh, you have different communication cadences. You involve yourself in different depth and in different ways. And so hiring and then parting with somebody is, it's very expensive, not financially. It's expensive to the business, it's, you waste time, you end up needing to bring people through a lot of organizational change.

It's also very expensive to keep someone in seat who isn't the right person. But generally speaking, uh, I have found that often when you hire a new person, it does take a couple adjustments of your own to find your rhythm with that person. Um, and sometimes you actually grow quite a bit as the, the founder by adjusting to, if you've hired well, adjusting to a new, more mature style of, of working together. So I would start there usually. 

Brett Berson: Is there an example of the past handful of years that kind of brings that to life? 

Jack Altman: Like a, a, a good example of this that I think a lot of founders have to go through is letting go of things that are really important to them, that they know that they want to control. An easy example that ports to every exec is do you give them complete autonomy on who they hire, or do you want to be deeply involved?

So commonly, and I think this is actually really good advice, commonly a lot of founder CEOs want to be like the final decision maker on every higher up to like, let's say 50 employees. Some will go to a hundred employees. You'll, you'll even hear examples of people doing this to hundreds, uh, which, you know, just requires a huge investment of time.

But at some point, you really have to decide when am I gonna start letting my execs build their own benches, even if I might disagree, for example. And there do come moments where that has to happen because to let somebody who is different than you, who you've hired because they're different than you, to let them fully express their potential, you're gonna have to let them make calls that are not obvious to you, maybe not obvious to others.

And so who do they hire? Uh, that would be a big one. Another example would be like, what's their method for prioritization? Like do they go around and do they solicit lots of team input or do they, you know, look at documents and do they make decisions in a vacuum, uh, more. And do they operate more in silos?

And for a lot of founders who are used to operating one way or another, there can be a lot of change there. And you have to sort of, uh, experiment with letting people do things differently than you. But any founder who's gonna go through the process of maturing a company is going to need to go through the process of building a team of increasingly operationally mature executives. And they're gonna do things that feel foreign to you on all these dimensions. And so there is this process of letting go and trusting and learning. How do you hold people accountable, not through every detailed input decision like you did when you were small, but now to outputs, to outcomes, uh, and to results.

Brett Berson: One of the things that you mentioned when we sort of kicked off the topic was obviously the topic of like self-awareness as a founder and CEO. Do you think that can be cultivated or do you think it's just more, some people tend to be more self-aware than others? 

Jack Altman: I think it can be cultivated. Um, I absolutely think it can be cultivated.

I think it's a type of work that is beyond corporatism though. It's beyond like management training. The work that you have to do to build that self-awareness starts, uh, very deep and very much at the like ego level. And I think this is one of the actual constraints for a lot of founders, and this is one of the great paradoxes, is that, to, you know, have the hubris to start a company and to think that you're gonna change some big and existing industry, you kind of have to feel in a certain way, like above the sort of normal decisions and the normal sort of operating of, of that industry. And so you have to have this relentless self-belief, and you have to be willing to, in the face of everybody telling you you're wrong or that you're, what you're saying doesn't make sense that you're actually right.

But at the same time, you need to then have the humility to realize like, wow, I need to grow tremendously if I want this thing to work unless you're, you know, a second or third time founder and you've had a lot of that growth and you're running a playbook, but, but even that person's gonna need to learn a lot of things the next time around.

And so this is one of the tricks is you have to hold in your head simultaneously, I believe that I am uniquely suited to do this thing that most people are gonna doubt me on and that they're wrong and I'm right and I don't know so much and I'm not even close to capable of running the company that we're gonna be in two years.

And so I need to change fast if I wanna stay effective in my role. 

Brett Berson: Do you just think about that or, or how do you develop that self-awareness?

Jack Altman: I think exposing yourself to things that help you realize how much you need to learn is one path. I think depending on your starting point, you're gonna have, uh, different, there'll be like different medicines for this. But one is exposure to CEOs who are so much better than you and so much more equipped than you are who you learn to trust and who are willing to take the time to sort of mentor and guide. And holding yourself up against that gives you this guidepost of, oh wow. Like I realize when running ideas by this person that helps me ground myself in how much further I have to go, uh, that could be one. I do think for a lot of people, the right sort of coach can really help getting to a place where you don't hold, uh, too much attachment to your own self image or worth based on where you think you are today.

Uh, cause you need to have both of those things. But sort of keeping the, the deep confidence while not being so attached to this is exactly who I am today. That allows you to have both, I think. So I think that can be a source of it. Um, for some people though, a lot of it, you know, it could be, it could be meditation, it could be like reading, it could be learning about, you know, spiritual practices for different people.

You know, like it's, it's all over, but it's, it is really a quest of learning about yourself and getting yourself there. 

Brett Berson: One of the things you talked about is as you're scaling you're, you're over time figuring out, uh, what are the things that you were once involved with that you're no longer gonna be involved with, or going from writer to editor over time or what have you.

What about figuring out if there are specific things that you should sort of never give up? 

Jack Altman: I think there are, for most founders, you'll have at least one thing you should never give up, um, or at least that you shouldn't give up permanently. Commonly those things are gonna be either product, sales or marketing.

And, you know, there's lots of examples of CEOs who stay deep in it, unbelievably long. Like, I think famously, like Marc Benioff will stay really involved in like a big sale even though, you know, Salesforce has tens of billions of ARR. Um, you know, there'll be, there'll be CEOs who never let that up.

Obviously there's tons of examples of CEOs who will never relinquish product strategy. Um, you know, you're actually seeing this with like Microsoft right now that, you know, Satya Nadella is still as deep in the product strategy at, you know, the biggest company, uh, one of the biggest companies in the world.

It's still, that's, that's the energy. And so I think most CEOs will have a spike somewhere. And the thing that they obsess with, uh, no matter the scale that they get to. That's not an excuse to not build out the function though I think that's where people can sometimes go wrong, is they'll think I'm a product founder, I'm not hiring a head of product.

And that's, that's not the right way to think about it in my mind. Um, or I'm, I'm an amazing marketer, I'm not gonna hire a head of marketing. You're just hiring to build a partnership with that person so that you can exercise what you're best at in that function. And so that you can dip in and out more easily because the CEO, as it scales, you are gonna, sometimes even if you are the product founder, there's gonna be a quarter where you have to obsess with something else.

And so you still need to build infrastructure. It's not an excuse to not build infrastructure. Uh, but I do think, um, one of the things that's unique about founder CEOs relative to like a professional CEO is you do, you do have this extra chip of moral authority that lets you shake things up and keep the startup feeling like a startup, even when you are at scale.

And one of the ways you exercise that is by staying deep in an area. 

Brett Berson: And so what, is there one area for you?

Jack Altman: You know, I, uh, I bounce around, to be honest, I, I would not say I'm one who goes exceptionally deep in any. Probably the ones I get the closest to are marketing and product. I am sort of evenly rounded, I guess.

Which I'm not saying that's a good thing particularly, but that's sort of how it ends up playing out for me. 

Brett Berson: And so maybe you don't kind of have the experience that kind of brings this to life. But I'd be very curious, and let's say relative to other functions, product is one that you tend to be closer to and be more opinionated about.

How do you think about building that org with the way in which you spike around that relative to an area like let's say go to market or sales? And is like the persona of the executive, and the way that you actually structure the org different in that case? 

Jack Altman: That's a great question. I think it's tempting to over index on building the org around you on this front. And I think you maybe should a little bit, but actually I still think you want to, I still think no matter who you are as a CEO the goal is to build a healthy organization that could function without you. And I think that's always the goal. And then it becomes a matter of where do you spend your incremental time. Examples of where you could change this up would be if you really cared to be the, you know, the final owner of the product strategy.

There are heads of product who that's what they're really driven by. It's not the execution, but they're really driven by, I want to decide the strategy of our product for the company. Um, that wouldn't be a great fit, for example. And so there, there are cases where you need to sort of walk that balance.

But generally speaking, I think it is a trap to try to over index the team around this. And really what you should be doing is constructing great teams, uh, and then choosing where to spend your time on top of that. 

Brett Berson: This sort of connects to the general topic of micromanagement. And, and is your take that it's, it's generally always bad or, or there's sort of types of micromanagement that can be effective? And I think it's, I dunno, I found it's kind of a slightly misunderstood topic. I think there's so many examples of just really exceptional CEOs that probably in certain parts, going back to what you were saying are, are like very, very involved in low level details. But I'm curious kind of what pops to mind for you.

Jack Altman: I don't know if this is a hot take or not, or if this is actually commonly believed. I believe that micromanaging has a very bad rap and is extremely important and effective. And I believe CEOs should do it. I believe executives should do it. I believe managers should do it. I just believe it's a tool that you should use sparingly and know what you're using, it is it's like a potent tool that should be used periodically. And so like then we could talk about like good and bad ways to use micromanagement? 

Brett Berson: Yeah. 

Jack Altman: Like a bad way to use micromanagement would be to use it as a crutch to help somebody who is in over their head in their job and to perpetually be doing their job for them.

That would be a bad use of micromanagement. That would be a sign if you need to do that, and if that's what you feel you need to do to be getting good results consistently over time, that you're gonna need to change out who's on the team. Um, but there are good ways to use micromanagement too. One is for standard setting and demonstrating to people the caliber of thought and work and effort, uh, that you want to see.

Another would be for showing that this is important to the company and simply by the CEO being involved in the details in an area that will actually attract energy and attention and effort into that direction. And so by micromanaging, by getting yourself into the details in the area, you're actually gonna bring others along towards that area over time. Um, that would be another good example. And then also I think on specific moments when there's like a really important decision and the CEO has real clarity and needs to break through something that you maybe don't have time to sort of go the traditional organizational route or whatever.

It is a shortcut that you don't want to always use, but shortcuts have value to them. And so as long as you're using it sparingly and you're using it in a way that's either helping coach and guide, helping set standards, helping bring attention, I think those are really important uses of micromanagement.

Brett Berson: What about on the other side, the role of like context setting as a CEO, educating, training, teaching, trying to help give people frameworks to sort of make decisions? What, what have you sort of figured out in that category? 

Jack Altman: Yeah, so context setting, it's one of the primary jobs. It is the mechanism by which you let decision making happen at scale throughout the org.

So the, the failure mode for a lot of CEOs around transparency, for example, is that by not sharing the important things about what the business is trying to accomplish, and by hoarding that information for a whole host of reasons, most of which are bad, uh, what you end up doing is you end up not empowering the people who are doing the real work, making the real decisions every day, whether it's chipping code, whether it's, you know, prioritizing short term product features, talking to a customer, um, doing a marketing program, any of these things that are like the, like the real work.

You're not empowering those people to make intelligent decisions. And you've hired intelligent people to do these things. And so you're like, arguably the most important role is to help the people who are doing the real things have all the context so that they can make intelligence decisions when you're not in the room.

And this context concept is it actually blends with another con- concept that I think is really important for leaders is around transparency. Where one of the, uh, evolutions I think a lot of founders go through as they mature is you start with this concept that transparency is numbers, and that transparency is pulling up a Looker dashboard, telling people what's in the bank account, telling people how much business you closed last quarter, and giving people just like data, big data dumps.

And that is sort of a form of transparency, but it's, it's really not what matters most. Uh, what matters most around transparency is the narrative and the why, like helping people make sense of the data, connecting it back to the strategy of the company, the thesis of how are you gonna win in your market, how are you gonna be a successful business, and what are you seeing in your shoes.

And that requires like vulnerability and honesty. And it does require you curating a fire hose of data, which you should also make the fire hose of data available. But that's like not, that's not enough. You need to then curate that into context and into, uh, helping people understand where you're like really coming from almost conversationally so that they can say, okay, the company needs to win in x, y, z ways.

And so God, I can kind of determine now for me on Thursday when I'm in this thing, this is gonna kind of get us to that goal or it's not. But it requires that, it requires a narrative. 

Brett Berson: Well, I, I think to, to your point, what a lot of people think about transparency or context setting, if they're doing it relatively well, it's like they have their board meeting and then they walk the whole company through the board deck and their all hands.

And ideally to your point, they're not just sending a board deck around, but they're contextualizing it. What are other examples of, of, of when you're doing context setting or sort of teaching to folks that you work with? Like if you think back in the last few months and you're like, okay, I feel like I did a good job setting context or giving people frameworks.

What are other examples of that? 

Jack Altman: So it's great. So that, that actually, that example of the board deck, that's one great one. Generally speaking, I've learned that if you want to be communicative and you want a context set, you have to give people as many different avenues and as many formats, and repeat yourself as much as possible.

And you'll hear this often that if you want people to remember things you just like, or as a founder or an executive or whatever, you just have to be repeating yourself nonstop. And that's kind of true, but it doesn't mean that you literally just repeat yourself nonstop. It means that you find a lot of forums to say the same thing in different ways.

You might do this in a board deck walkthrough. You might, uh, send out an email with like your thoughts every Sunday or every month or whatever. And just like do written sort of thoughts on what's the most important idea in your mind. Uh, you might do open town halls or Q&As to just invite anybody to ask you questions if you're comfortable doing that.

Um, you might have department walkthroughs presented to the company so that everybody can get an inside look at what's engineering and product prioritizing, what's on the sort of sales and marketing roadmap this quarter. So you can do deep, deep dives like that. You can do team on sites or, uh, you can do like annual kickoffs or quarterly kickoffs where you sort of go through like roadmaps for the quarter.

You can just chatter in Slack and you can do really casual stuff where you have conversations out in the open. It's really, and, and you can obviously do like document, like people will make like really comprehensive wikis, onboarding training docs. It's really a multimedia full court press. Uh, that is all, uh, that is, that is constant, uh, for people.

And there's a balance, right? You don't wanna be like overloading people constantly, but you need an ongoing presence and you need to meet people where they are. And different people consume information different ways. So I do all of these, um, you know, it depends on the moment in time and all of that, but I think the, the key is like lots of media often.

Brett Berson: Going back to kind of the, the sort of broader topic that we're exploring, which is sort of how you effectively grow as a founder and CEO. When you think about the things you've figured out the hard way or you're like, God, I wish I knew that nine months ago, it would've saved me so much pain. Are there 1, 2, 3, 5 things in the journey thus far that sort of come to mind?

Jack Altman: One that I consistently have to relearn all the time is that an uncomfortable conversation today saves you so much pain.

Uh, any uncomfortable conversation that you think you need to have that you're just gonna push off, you're almost always taking on debt to do that. And there can be moments where it's worthwhile to push off something uncomfortable, whether it's telling somebody that they can't have the role that they want, or maybe that they're even not the right long term fit for the company, or that you're actually gonna defund, deprioritize an effort that they really care about, that you're gonna go a totally different direction on the strategy than the one that they've felt really adamant about.

Um, there's a whole host of these kind of things and it's really tempting to convince yourself to put these off. And, you know, you're tired, you're working hard, you've got a million things going on at once. You've got 200 emails in your inbox. Like, it's really easy to convince yourself, particularly in the early days when you don't have a lot of infrastructure that like, I'm just gonna take on debt.

And I continually learn that that's a bad trade much more often than we let ourselves make the trade. 

Brett Berson: And so on that, is there anything you do to keep yourself from doing that?

Jack Altman: You know, I don't know that I have, uh, one other than there's a, there, there's a reinforcing nature to it. When you do it enough times and you get more comfortable with it, and so you experience less pain from doing it, and you experience more gain of just, I'm gonna give people the clarity and then we're gonna move forward from there.

You really end up learning that like almost all of the uncomfortable conversations you need to have they might, they might be tough for 15 minutes while you're having them, they might even be tough for a few days, but they're often not as bad as you think they're gonna be. And the more times you do it, the more you realize people aren't gonna freak out at you if you speak honestly and compassionately, like people are adults, they're gonna hear the information that you have to share if you're grounded in your decision making.

They'll respect that. And then, and then you move forward from there and it's like this huge weight gets lifted. So I think some of it is just the repetitions and positive reinforcement of doing it and realizing that like, yes, this is good for me. Um, but no, I don't have any like trick of like, you know, I take a, like a nice bath and then I'm good to go or something.

It's just, you know, you build some- 

Brett Berson: You should try it. 

Jack Altman: I would try a nice bath. That could help. But, you know, I, I don't have anything special, but I, that, that's a big one that I've learned. 

Brett Berson: Okay. So difficult conversations, one. What, what else sort of comes to mind? 

Jack Altman: Your most important decisions, you need to own.

And what I mean by that is when it comes to a really big hire or, uh, when it comes to a core strategic decision that you might be making a market that you do or don't want to be in, when you're in your most uncertain moments, as a founder, it's really tempting to offload that decision as much as you can to your investors, to other execs, to your co-founder. To try to basically see, all right, if I'm like 55/45 on this decision, let me just go pulse the wisdom of crowds of the people around me that I trust. And I'm gonna maybe just go with that.

And you can't do that. You have to own the decisions. A lot of the decisions that you're gonna make as a founder are very not obvious on paper. A lot of the best decisions you'll ever make as a founder are not obvious on paper. And you need to have the confidence and fortitude to do those and own them.

And one of my learnings has been when I didn't go with my gut on how I wanted to play things and it didn't work out, I just, I, I, I experienced so much regret around that because I'm like, gosh, I knew, I knew the answer that I should have done. And I just, I didn't trust myself for some reason. So that's a big one for me, is the types of decisions that are most tempting to outsource are the ones that you can't. So that, that's a, that's a key one for me. 

Brett Berson: Why do you think that is? 

Jack Altman: The things that end up mattering the most to the company are not obvious decisions most of the time. Um, or at least a lot of the time where like some, sometimes there's something that's like very straightforward. But when you're a startup trying to do a new thing and you're trying to not be just another part of the pack, but you're trying to be unique, you're gonna have to do things that are not obvious at some point.

Every great startup does nonobvious things many times along its journey, whether that's, you know, betting on a hire that like most, you know, VC board members are going to pull up their LinkedIn and say, that doesn't make sense to me. Whether it's getting into a second product category before you really feel like you're ready, but for some reason you think that you should. Whether it's reversing course on a decision that it's gonna actually make you look really silly, but you know it's the right thing.

A lot of those decisions that you feel very marginal on, those are the ones that end up really making the company. And it's tempting to, because they're not clear, it's tempting to want to get validation. And you're not gonna get to know from the market for a while if the decision was right. And so at least you think, well, if the rest of my exec team agreed, or if the rest of my board agreed, at least I can lean on that.

But those moments, you have to really look inward and you have to own your calls. I think. 

Brett Berson: What's, the, one of those that sort of come to mind for you? 

Jack Altman: This can happen in a bunch of cases, um, in both directions, but like it, it can happen with a hire. I think as you, as you get further into the, the startup journey, uh, as your board becomes a bigger presence, they'll end up playing a bigger role in your hiring.

And they should, and you should listen to and lean on your board if you've got, you know, high trust in them. Uh, but at the end of those, you know, candidate interview loops, you, you make the call. Um, that, that, that is an easy place where founders can, uh, can go askew. Um, product strategy would be the other big one that I think about.

Brett Berson: What do you think is a good percentage in terms of accuracy of those decisions? Do you think those kind of thorny decisions that you need to make as a founder if you're getting it right, 60% of the time, you're doing excellent? 90% of the time? What's like the bar for accuracy? 

Jack Altman: It kind of depends on what type of decision.

Like the, you know, the type one, type two decisions. The one-way doors, two-way doors. So I'm a big believer in this. I can't, somebody was just saying this to me the other day about, uh, for decisions that are two-way doors or decisions that are not just like, you're gonna do this thing and it's set in stone forever.

The person who makes a thousand pots in the same amount of time that somebody else makes one pot, that person who makes one pot is not gonna be as good as the person's, other person's thousandth pot. Even though it only took them a thousandth of the time. Repetitions really matter and you can throw away 998 of your pots and just make one at the end.

Um, and I think for a lot of decisions like that, velocity massively outperforms accuracy. And for the vast majority of decisions, velocity is your friend. And so for, for those kind of things, I'd say 60% is great. Particularly if you're willing to reverse course, if you're willing to make lots of decisions and you're gonna do those decisions with high throughput.

Like way rather make a thousand decisions that are reversible and be 60 or 70% right than make a hundred decisions and be 90% right. I'm gonna make many more correct decisions, and if they're inexpensive, that company's gonna outperform. The key is knowing when you are in those important moments, where it's the other type of decision, where you're gonna do something that is in fact hard to unwind, or does in fact set you down a path that you can't really walk back from, or is gonna be something that yes, you could undo, but the damage is gonna be really expensive.

And for those you, you really wanna slow down. Um, and so to me the wisdom that you accumulate over time is knowing which is which. Um, accurately pricing how bad is missing on this decision. Um, and then for those you do want to take your time.

Brett Berson: One of the things I've found on those type of decisions is just when you're soliciting input, doing it one-on-one is so much more valuable. I would think like you talk about an exec with your five board members in the board meeting. The quality of that discussion versus calling each one of the five, getting all their feedback. It it, it seems like in those decisions when you get groups together, you can kind of create this bias in that meeting that steers it in a very specific way.

Jack Altman: Absolutely. And you, you end up also in, uh, dynamics where their incentives enter the equation that aren't just to do with what do I actually think? You start getting into, not just with boards, this is with any groups of people, but you get into things where people are perhaps being performative, where maybe they're actually trying to communicate some subtext to somebody else.

Maybe they had a private conversation, they think they're supposed to say something. Maybe somebody's holding back what they wanna say cause they don't wanna have a confrontation. There's a million reasons why the signal is lower. That doesn't mean that you should never, there are, there are good moments for group conversations on hard issues, but yeah, I do agree that one-on-ones are where you get rawer feedback.

Brett Berson: A little while ago you mentioned that you ran an experiment where you removed yourself from most of your meetings for a week or two and it, it was kind of an interesting experience. What, what, what was that about and kind of what did you learn? 

Jack Altman: Yeah, I, I had a moment in the fall where I just felt myself, and this happens periodically, I felt myself just pulled too deep in too many projects and too many decision trees. And I was just in the flow of too much work.

And one of the things I do believe in general is the more senior you are in the company, the more you should be working on the machine rather than in the machine. Obviously we're all gonna be part of the machine as well, but generally speaking, you know, your company gets past a certain size and as the CEO you really want to be constructing the machine from the outside, more like a mechanic than like, you know, a lever or pulley. And, uh, I felt myself being a lever, a pulley ramp and all these different things. And I was just, I knew that that's not the zone to be in, and so what I did is I fully just pulled myself out for, for a week.

Um, and I just cleared my calendar, didn't take any meetings. I still worked, but I worked on things that were, that had not, not, no meetings, nothing responsive, nothing uh, to do with what was going on. And a few things happened. One is I saw the places, even in that short of a time, maybe it was like a week and a half, but even in that short of a time, you see the places where you really were needed.

You see the places where stuff really doesn't work very well without you. But the other is you see the places where actually you were just providing a crutch that wasn't even helpful. And with you out of the picture, two other people at the company have the conversation. They start making decisions without you.

And all of a sudden that sinew is built. And they don't want you back anyway in that flow afterwards. And it's better for everybody. I think of this similarly to every three or six months clearing all your meetings, and building, you know, any one-on-ones or standing meetings that you might have, putting those back, but blowing up your whole calendar once every three, six months.

And then the things that are important will find their way back and the things that weren't needed, it's like a, you know, it breeds, it breeds relief into the system. So yeah, that was, that was what I did. It was very effective for me. Uh, I should do it often actually.

Brett Berson: Just for years. 

Jack Altman: For years really, for years at a time. That'd be great. 

Brett Berson: If someone were to take a look at, you know, sort of follow you around for a month or two and, and watch the way that you're running the company at, call it 600 or so people. Are, are there things that they would be surprised or relative to other CEOs running similar sort of scale businesses that you've chosen to do differently for some reason?

Jack Altman: Well, I don't know exactly because I don't, I, I don't get the privilege, I don't get to, I would love to, but I have not shadowed other CEOs. I'm, you know, friends with a bunch of similar companies, and I suspect that not everything's the same, but, uh. 

Brett Berson: I, I always thought that would be an interesting thing for CEOs to do. You go spend a week with one CEO and later in the year they spend a week with you of just being in all your meetings.

Jack Altman: I would love to do that. So I don't have perfect information here. Um, I think one of the things that's probably different is I, I suspect some CEOs at this scale are a bit more, uh, planned and rehearsed and tidy with their communications and their sort of expressions of themselves to the company.

I tend to show up and communicate very extemporaneously and very, uh, informally to people. Which I think has both pros and cons, but I've learned over time that that's the only style that works for me. Um, and so I suspect that that's different. 

Brett Berson: If you had to teach me how to be the CEO of your company in call it five minutes-

You specifically?


Jack Altman: I don't think I, I don't think I- 

Brett Berson: Someone like me that's more capable. 

Jack Altman: Okay. 

Brett Berson: What would you be imparting with them that they need to know? 

Jack Altman: Oh, geez. In five minutes? 

Brett Berson: Yeah. Something like that. 

Jack Altman: Well, I would tell you. Don't do anything for a little while, it'll be fine. So just chill, you know, at first, I think in general, I say to, and this is something I really believe that connects to hiring management and also just for your own, uh, leadership as a founder is it's tempting to do a lot and you actually don't need to do that many things.

Mostly you need to be learning. Most of your time should be spent gathering information, understanding where people are at, understanding what progress is happening, understanding what decision points we're looking at, getting data. But you mostly are trying to become a super prepared mind. So that when it is time to make important decisions, you are very up to speed and you're looking for a small number of extremely important details.

But, uh, most of your job is learning and understanding with the idea of being a prepared mind, knowing that you have to make a relatively small amount of decisions in general. So that would be one thing I would say off the cuff. Another I would say is, uh, it is tempting as the CEO to go very inward to think that you should sort of like, uh, that you don't wanna misspeak or you don't wanna miscommunicate.

And so you're gonna really like shield yourself and you're gonna button everything up to be perfect before you do anything or address the company or, you know, get, gather a bunch of leaders to work through an idea. And I have found, generally speaking, that people respond really well to honesty, vulnerability, and like, you know, you just sort of doing what feels natural to you, and you having some faith and trust in yourself to operate, you know, based on what you think and not have to, uh, not have to like protect yourself too much.

Similarly, to that point, actually, I think I find that when I'm having fun and when I'm like leaning into the joy and the like creative elements of things, I have more fun, I have better ideas and other people then will draft off of that. And so knowing that people are gonna match your energy style and your view on the world to some extent, uh, you just choosing to show up those ways, I would say like that matters a ton.

I would tell you in five, if I have five minutes, I would say before you do anything, go talk to 100 customers or 200 customers. Uh, don't do anything and don't make any business decisions until you've done that. Talk to customers of every different size. Talk to heads of HR, talk to the admins who are deploying the tool.

Talk to some managers and execs who are consumers of the tool. Talk to people using all the various different products. But the source of truth on everything is customers and don't make any decisions until you understand the mind of the customer. That is the big thing I would say. But yeah, those would be a few places I would start.

Brett Berson: In, in those con- in those a hundred conversations, what, how do you structure those, or what would you be asking or talking about with customers? 

Jack Altman: Well, if you're coming in truly knowing nothing, I would tell you to go try to be friends with 10. And go just talk to a hundred and just like learn about their lives.

But I would actually tell you to go be friends with 10. And what being friends with 10 is gonna do is it will get you past the sort of more corporate back and forths and niceties and the surface level things of, okay, I'm talking to Lattice so I should tell them about X, Y, Z. And it will get you to the more real places of learning.

Ugh, let's forget Lattice, but heads of HR get really stressed out by their finance partners in X, Y, Z ways, or they historically have really felt that they didn't have like a good seat at the table. And so they actually are coming with a little bit of their chip on their shoulder and they really want to feel strategically empowered or whatever.

And there's a whole bunch of these, but getting past the surface will help you better understand the true motivations of who you're serving. Just the same way that like getting to know somebody as a friend will help you like better support that person. I think that's something a lot of founders miss is they keep it really clinical. And I've always found that for me to make good business decisions, I need to know people that we serve as well as I know, you know, people that work at Lattice.

Brett Berson: You mentioned sort of having a prepared mind. I'm sure some of that is a deep understanding of the business. Some of it's just meta lessons about sort of how to be a CEO. When, when you think about that sort of growing that we've been talking about as a founder and CEO, where have you learned the most other than kind of learning on the job?

Jack Altman: Certainly learning on the job is number one. But the thing that I think is so fun about this job is that you're, you're expected, and in fact, I would, you know, better said, you get the privilege of having to know a lot about a little bit. You need to know a little bit about capital markets. You need to know a little bit about, uh, what does hiring look like.

You need to know a little bit about product development. You need to know a little bit about just like general, uh, business and like financial management of companies. And you're not gonna find all of these things in one source. I mean, the best maybe that you could get, try to try to get an all in one, is to really get an amazing mentor, an amazing CEO mentor from another company, which is structurally hard, like different than in venture capital, where you might work at a firm with somebody else who's been doing it for 20 years longer than you.

If you're the founder CEO you don't, you don't get to work with an, you know, another CEO who's 20 years more experienced than you in real time. So you have to kind of go outside the company for that. Um, but that can be another source. Um, I mentioned coaching before. I think that can really help you with building sort of your own, um, mentality, your own, like, this is how I'm gonna operate.

So I think that can get you some grounding. I've found books to be very helpful actually. Not like business books, although like I've, I've read business books too. But, uh, or at least not the self-help variety. But for me, reading like biographies of like great founders and like great companies, I think there's like a lot to glean from those. Good board members can teach you a lot because they're bringing it, you know, insights from other companies over to you.

So there's not one great place. And it does get challenging, uh, to find a continual source, but there's not, there's not one really. Uh, this is one of the challenges of the job is you are, uh, you are in it alone each day with nobody else who has a job quite like yours. And so it, it's challenging. 

Brett Berson: Are there specific CEOs that you think you've learned the most from over the years and any kind of things that popped to mind that they've imparted on you?

Jack Altman: Yeah, definitely. I mean, like, I think, uh, for me a lot of it has been, I found that there are CEOs who are particularly good at something that become like a go-to default on like a topic where I think I've got like a lot to learn from them on. So there might be somebody who's like incredibly good at like managing execs, uh, as you scale, uh, there might be somebody who's extremely good at thinking about partnerships and business development.

There might be somebody who's really good at fundraising. And so for me, a lot of it has actually been finding other founders who I think are like world class at one of those things. And then I, uh, learn from them on that topic primarily. 

Brett Berson: So I thought we could talk about a few, what I sort of label quick fire management issues, and kind of get your quick take on, on how you think about them. 

Jack Altman: Great. 

Brett Berson: So one would be how do you think about managing someone on your team who's, who's doing a good job, but they're not amazing? So I, I think that as, as you're starting to run and grow teams, there's people that are obviously having an outsized impact or are unbelievable on a steep trajectory.

There are people who are, obviously either don't have the capability or context or environment to do great work, and they're kind of in the bottom 20%. But there's a lot of people that are doing a good job. And I think that, um, you're often sort of struggling with exactly what to do particularly because, you know, going and recruiting someone else could be quite painful.

And so how do you think about the role of, of your job as a manager with that type of person? 

Jack Altman: Yeah, it's a, this is a great topic because obviously we can't all have companies that are all composed of top 10 percentile people. 

Brett Berson: Well, people say they only hire A players. 

Jack Altman: Well, we do, but not everybody can.

Brett Berson: Sure. Exactly. 

Jack Altman: I think of this, you know, not to get frameworky not a huge framework guy, but I do think of this as a quadrant, uh, a 2x2 of are they high performing, low performing, high growth, low growth? You know, somebody who is low growth, low performing. That's just, there's, there's no room for that, uh, at a company.

And that person might be high growth and or high performing somewhere else. You owe it to that person to like part ways. And so, like, this is actually something that I've become, uh, that I've really changed my opinion on. I used to feel terrible about. Um, I still do like, feel terrible about parting with people.

I've come to realize, as I've seen the full life cycle of that play out. You're really not doing anybody any favors by keeping them in a role where things aren't working well and oftentimes when you do move on from that person and you rip that bandaid, they felt it too. And they go on and they're super successful somewhere else in a different situation that's built for them.

So, low performer, low growth, there's, there's no room for that, obviously, high performer, high growth, like promote, promote, promote, lean in, give them resources, build teams around them. Like those are your, those are, those are your key people that you're, that you're building teams around. What you were kind of talking about is the reasonably high performer, maybe the low growth type of situation.

Uh, the, and just to be clear on the, the other one, the, the high growth, low performance that's, that's where coaching and management is, got the most potential of all. You know, and the high growth, high performance, you're kinda getting outta the way. Low performance, high potential that's where great management really shines.

And that's where you can really inflect the curve of your talent pool by leading them well and coaching well. But in that, in that other quadrant, um, that is an o- that's an okay thing. People who are rock solid position players, Um, it's not a sexy thing to talk about. You won't see lots of blogs about this, but every company needs, every company needs people who are doing their role competently, are happy in it, are not striving necessarily aggressively for the next thing.

And the company might not need that today. That doesn't mean they won't change a year from now and something will flip and now all of a sudden they do wanna be high growth and the ambition turns on. But at a snapshot moment in time, it's okay to have those. It's even good. And in fact, um, as an example of like, you know, like why you need it, is like in the fullness of time, compensation structures follow performance.

Basically no companies can afford to pay top 1% talent and comp, you know, for, for the whole company. Like you actually need people who are, who are sort of in the median, uh, around the, around the median. Um, so that's all okay. To your question about do you keep, do you part. It's a judgment call in these cases. Obviously over time you want to be getting as many people into high performance, high growth as possible. But you also can't fight every fire at once.

Um, like it's just not a reality that every startup is perfect and pristine at all times. And having fewer fires to fight, uh, is a good thing. And, um, you know, you have to, you have to pick your battles. And so there's lots of times when the absolute right thing for someone to do, in a well performing but low growth situation, is to be happy with that.

Um, that's like the backbone on which a lot of companies are built. Um, and there's, there's totally nothing wrong with that. And this is kind of under discussed, I think. 

Brett Berson: What have you figured out about sort of employees doing a good job scaling with the business and at some point they don't have the capability or the rate of learning isn't there for them to do the next job? But they've been with you for four or five years. They were there in their early days. And so like the classic example would be you hire first marketer and they're amazing for three or four years. 

Jack Altman: Mm-hmm. 

Brett Berson: And, and eventually you get to a point where, where you need a VP of marketing or a CMO or whatnot.

Jack Altman: Totally. 

Brett Berson: And you get into these very thorny issues where they're somebody that's deeply passionate about the company, they contributed so much, they have allegiance to you in the company. You sort of reciprocate and you're worried about them leaving, being demotivated. How do you sort of manage through that sort of situation?

Jack Altman: Well, you start by seeing about, uh, A) are you and that person on the same page about the gaps or not? Like do, let's say you're that head of marketing, do you and I agree on this is kinda what the company needs and this is where we are. This is where you are. It's not better or worse. You're just, you're, you're a different shape right now.

And do we agree on that difference or not? And I think that is like an important place to start because so many of these disagreements between, you know, people can be around a fundamental premise level disagreement about, am I doing what the job requires of me or not? Sometimes you are actually on the same page, sometimes you're not.

Sometimes you can reconcile it, sometimes you can't. But that, without that, grounding, it would be like you and I trying to, you know, have, have a debate while we didn't agree on the, like, premise level facts. And so I think a lot of people skip that step, but you need to do that first. This is an example of like one of the uncomfortable conversations I was talking about earlier where like, it's uncomfortable to tell somebody like, Hey, you're good at, you know, managing people, you do not understand how a funnel works with like, nearly enough, uh, specificity for this level. 

And like, we kind of need that now. And like, do you wanna learn that? And they're like, what are you talking about? Of course I do. Uh, or I don't, or I don't need that. You know, either of those you're at a fundamental disagreement and, but at least now I've said the uncomfortable thing and now we can work through it from there.

So that'd be my starting point is can we, can we get to the same place? Uh, my second would be if we are at different places, are you motivated to, to do that? Like people often talk about, uh, people scaling as growth, which is a form of growth. But not everybody wants to scale. Like being a head of whatever at a 25 person company is now better or worse or easier or harder than being the head of marketing at a 250 person company.

Uh, or probably 2,500 for that matter. Definitely it's gonna require like more, you know, years of experience and there's some people issues and things like that, but it's not that one is better or worse. They're just different jobs. And so you also have to understand, does the person want to evolve in that direction?

Do they want to learn that next set of things that you think are gonna be required? And so that can help too, uh, in, in the conversation. Generally what I've found is as long as you and that person can get to a place of common understanding, you will, you will have the answer kind of reveal itself to you.

Either you'll together learn that you don't, that, that that person doesn't really want to do this next phase of the job. That you and that person are just not gonna come to a common understanding of what it takes. Or actually, you, you do agree and that person does come to peace with, you know what I am gonna learn from, you know, an experience later because I do really want to do that and I see I'm not gonna get there fast enough.

And I've had all of those happen. Um, the key I think, you know, to, to the question when this person is really well respected and when the company really cares about them and they have all this storied history and all the rest of that. 

A couple comments on that. Um, this is an evolution also that I've had as a founder over time. It's very scary. Uh, but it's important to realize that the company is bigger than anyone. It's bigger also than you as a founder and mostly, you know, once you get to a certain scale and you don't wanna over index on like fear, whenever you're living in like fear land, like you need to find your way out.

It's not, it's not going to lead you to greatness. And so being, living in fear of this person's gonna leave and then their whole team's gonna quit, and then we're gonna go out of business. Like, those are, those are not real cycles. Those don't ha- it doesn't happen like that. And even if they did, you need to have the courage to make the right decisions for your company that are, are not living in that place.

Uh, so, so that's one. The other is like, when you have a person like that, they're not gonna wanna leave the company in a bad place. They're gonna want to figure out ways as they leave to set their directs up to say, all right. I'm leaving, how do I make this an opportunity for my direct reports to step up into bigger roles for them to get a chance to grow, to make room for other people who have been overshadowing.

So, I don't know. I've, I've experienced that these things, when you're, when you're caring, when you give the person lots of chance and when there's mutual respect that's been built over years, it goes better than you ever expect it to. Even when an outcome happens that on paper would be scary. 

Brett Berson: Do you think about managing performance and or managing out an employee who is well liked versus not well liked in any specific way?

Jack Altman: I think about it, I don't not calculate it at all. It is a, a terrible reason to keep somebody around really because of a popularity contest and because people just like, think they're funny and like, you just like kind of want them and people just sort of like their vibe. That's a bad reason. Sometimes people like somebody because they're actually helping others do their jobs.

In fact, that's often why somebody is liked in a, in a company context. I might not be, you know, perfect at what I'm doing. I might even be a low-ish performer at what I do myself, but for various reasons I might actually make the people around me better performers. And so that's one sort of being liked that you need to root out.

Like an example of this might be a product manager who is not particularly adept at the craft of product itself, at the prioritization process, whatever. But is unbelievably valuable to their counterparts in sales and success in marketing and provides this incredible glue between the two. And so somebody in engineering or design might critique the person and say, look, I'm getting bad product specs these don't make that much sense. They're imperfect. But then people in sales and success are telling you, whoa, this person, I, like this, they're my window into the whole product organization. Like, lemme tell you how valuable they're, and so you have to kind of suss out like, are they liked because they're funny and just like a likable person?

Or are they liked because they're actually making people's lives around them, lives around them better. There's also good reasons to be liked that are around, like being a really important culture carrier. Like I'm, I'm a big believer that, um, I actually should have said this before, like I, I probably spend more time on like, thinking about culture than average.

And I think that pays off in huge, in sort of unseen ways. There are people who legitimately carry a lot of culture and that's not just a fuzzy thing, it's actually a really important thing. And so people who are liked because they embody the values that they uphold and they enforce the values around, uh, with the people around them. I think there are some things like that too that are worthy of consideration.

So it's, it's not what it's all about, but I don't think dismissing it outright is a good idea. Like people are liked for a reason and, uh, as long as you're not going into popularity contest land, but you're understanding that somebody is liked because they're contributing values in less obvious, less on paper ways.

That can be, that, that's definitely a tick in someone's favor. 

Brett Berson: So what would you, I mean, that was a really interesting sort of example. You have a PM who in the maybe classic definition, classic rubric isn't meeting expectations. 

Jack Altman: Mm-hmm. 

Brett Berson: But you talk to a bunch of their other counterparts and they think they're amazing. Do you ultimately manage that person out, or what do you do with that person? 

Jack Altman: It depends. It, it, it might be that you need to actually provide them a ton of coaching and guidance on those more traditional product pieces. Might be that you need to put them in a different role. It might be that they're actually shaped perfectly for, you know, a PMM role, but are not meant to be a PM. 

So I think it's kind of case by case, uh, and it should still be addressed. Of course. 

Brett Berson: What about sort of on the topic of, of, of exiting employees where it makes sense, do you think about, or, or, or are there ways that you create a culture that does a great job of figuring out who the people aren't, that aren't a fit?

Because one of the things that I've noticed is that it, it's, it's not a topic that a lot of founders or CEOs think about. Like when they think about all the, they might think about their exact team and how are they managing performance, but like up and down the org, are we doing an excellent job of creating an environment where people can do incredible work? And at the same time, if somebody's not a fit, where it's not lingering for years or months or sort of that type of thing. 

Jack Altman: I cannot say I have a solved answer to this. I think this is incredibly difficult to try to drive this type of management at scale. I think there are things you can do certainly. There are, in some orgs there are programs that you can have where it becomes, uh, a much more clinical decision, um, based on metrics and things like that. And so you take some of the workload off managers. People will try things like manager training, uh, you know, you can have really generous severance to make that an easier experience for managers.

Um, you can filter for this in your hiring of managers. Uh, and you, you know, I, I do often like to ask people, like, tell me about a time that you had to like, let go of somebody that you hired, uh, you know, in a relatively short period of time and just like walk me through that whole experience. And that can, you know, there's questions like that that can teach you something.

Many people will have zero examples of that. There's not an easy solve to this. It is like ongoing difficult work. Uh, I, I don't have the answer. 

Brett Berson: When you think about the first handful of years of the company's life, when someone was exited from the company, do you tell the rest of the company why and they were let go for performance reasons or do you leave it vague?

Jack Altman: I don't. I'm a mega not fan of that. I know some people, I'm sure there's good founders who really like to do that and to show this is our chance to show our standards and we're gonna prove that we're a high performance company here. We're gonna make an example. I'm just like, I don't know. Like if I'm one of the other people watching that happen, do I feel a sense of trust?

Do I feel like a sense of privacy? Do I, am I worried that they're gonna, they're gonna make an example of me. Like I think of our culture as a product to our employees of the experience of working here. I would feel a sense of anxiety and fear if I worked at a company where when someone was let go, it was like walked out all the reasons they were let go. In fact, I'm not even necessarily a fan of saying the person was let go. I'm, I prefer to just say, Hey, this is, you know, they're they're leaving. This is their last day. Like, let them, you know, assuming stuff didn't get weird, like let them say goodbyes, let them kind of own their narrative.

Like it's not really other people's business. And the downside of that is people can't tell. So I'm not saying this comes with no cost and people will, I've had tons of employees ask me about this over the years of like, Hey, that person left. I can't quite tell, you know, did they get let go? Did they choose to leave?

And I'm like, it's not really something I want to, wanna share. And I realize that that leads to worse information for you, but it leads to a culture where you can trust that like, if we do make hard decisions, like we're gonna respect you on your way out and there's gonna be a lot of, you know, privacy and, uh, we're gonna, we're gonna let you go out proudly no matter what happens.

I think there's a lot, I think there's a lot to be said for that. And that's just, that's a personal preference. That's the kind of company I wanna have. 

Brett Berson: The thorny issues you get into are sort of narratives that form around those things. 

Jack Altman: Totally. 

Brett Berson: Because obviously the individual is gonna put a narrative out.

Jack Altman: Yeah. 

Brett Berson: That may or may not be reflective of reality. And then you also have, I think there's a big difference between managing people out and people just choosing that they don't want to be here anymore. And so you kind of have sort of odd dynamics, but like all of these things, there are trade offs.

Jack Altman: It's high cost. And it's not even just they're gonna put a narrative out. In many cases I, I actively help them put the narrative out and I'm proud to do that. And I realize that that leads to a case where somebody who we thought was not a good fit is now telling the company I, I'm leaving. And that's gonna maybe sow doubt of like, oh, this person, did they, do they know something I don't? Or like a million other things. Particularly because we do it consistently and people know that it's basically treated privately. Yes, it leaves uncertainty, but, uh, the, the trust and respect is worth it to me. 

Brett Berson: What about management more broadly in kind of this new regime where money's not free, profitability matters more, maybe you can't afford the same snacks you used to? Unintentionally or intentionally kind of what are the changes you're seeing in, in as it relates to management in this environment? 

Jack Altman: Companies will have their own intentions for how they want to operate, but those have to be joined with market realities that they're subject to.

So it would be a mistake to, for example, completely ignore compensation trends in the market. It similarly was a mis- would've been a mistake through 2019, '20, '21, to ignore the balance of power between employees and employers. And we were living in a very atypical moment for years there at the end of this 10, 12 year bull run where employees truly were starting a job search and within a couple of days, 5, 8, 12 offers.

And it was wild. Recruiting processes were extremely shortened. Companies were being very competitive with one another. Um, the compensation that people were facing from public companies was going through the roof, and that was applying pressure to startups. And so you saw all of these market forces happening on compensation, and for good reason, companies basically had to follow along with that.

Uh, and similarly the balance of power dynamic there, where employees just had so much control, so much ability to get a new job, to upgrade roles, to upgrade, you know, the company that they were working at, to get a higher offer, to get more scope, whatever. Uh, it was really substantial. 

And uh, the result of that was that companies had to start to think about management in relation to these market dynamics. Part of what happened is the role of the manager became different, the role of the manager rather than what it was historically, like, let's go really far back. Let's go back, you know, decades. You think about the manager in sort of this, you know, more negative sense where the manager is holding people accountable, focused on deadlines.

There's a lot of fear associated with the manager. The performance review is all about assessing do they get to keep their job this year and whatnot. And it was a very top-down, hierarchical style of management where what you were experiencing was something very negative for employees. And uh, you then saw a world where it flipped very sharply the other way. We got to a point where management for a lot of people and a lot of managers, the experience of management became, how do I find ways to keep this person happy as my, as my number one directive. How do I find ways to meet their needs? How do I find ways to grow and develop and keep them happy and motivated?

And a lot of that's great. And so there's a mistake of taking this new market moment where things have kind of gone a somewhat new direction. Although I will add in here that in tech, the labor market is still quite tight. It's not, it is, uh, it is still a very tight labor market, although the dynamic has changed.

But it would be a mistake to throw that all away. I think there's a lot that's really good. I think it's an 'and' function. I think managers need to not just be focused on how do I act in service of the employee, but also how do I ensure that the employee's work is being directed in service of the company.

And that balance is new. 

Brett Berson: And what does that look like, or how do you figure out you're running a company with a certain set of beliefs in way- ways that you orient and treat people, like what does it actually look like? 

Jack Altman: There are gonna be more moments when a manager is going to need to ask of employees things that are more uncomfortable, that are more against the short term interest.

And I don't think that that means bad things for employees. In fact, on the contrary, I think over time this is actually gonna lead to people learning more, to having richer experiences at companies, to having better growth trajectories, to actually accomplishing more things. Because when we got to a place where it was so, uh, in service of just the sort of shorter term, more base interests, I think we lost some of the, the real like joy and meaning that comes from the harder work of the longer arcs of sustained effort towards an important goal.

But that means that managers are going to have to, at moments, say, yeah, we are gonna have to work really hard on this sprint to get something done, but we're gonna be really proud of what we've accomplished on the other end. Or, I know you wanna become a manager right now, but I'm not going to contort the shape of the org to create that role.

I, I really need you to play this particular role right now. That's what the company needs from you. And, you know, we'll keep eyes out in the future. Versus in the past, in either of those examples, you might have had, you know, the manager going to their, you know, their departmental exec and saying, I realize it's weird, but I want to create an org structure that is not intuitive on paper.

Cuz this person's awesome and we have to keep them. And I think you're gonna see less of those moments. That doesn't mean that it will be bad for people in the long term. I think we actually did a lot of disservice to people by adhering to every, uh, you know, interest in the short term that we did over the, the true bull run years.

But I think you'll see differences show up like that. 

Brett Berson: One sort of related topic is I, I think if you think about individuals in your company, there's a set of things that they exert sort of cognitive effort into that is oriented around themself, and sort of one bucket that's oriented around the business and the customer, and then some in between sort of area where that's sort of overlapping. And I think that at times that sort of ratio can be out of whack. And so an example would be, well, I wanna run a big team that's important to me, or I have to do this so that I can get the title that I want. Or I'm doing this job because in my future career this is gonna be important.

And some of those things overlap with what's right for the business and the customer. But sometimes it's just human nature that it, it is either an opposing sort of view where there's only so many hours in the day so if you're spending a lot of time on your career ladder, and not a lot on the subtlety of what's going on with the customer.

You're probably decreasing sort of shareholder value in some way. So I don't know if you think about that or kind of how do you create the right alignment or balance so that the maximum energy goes into the customer basically versus the individual or employee? 

Jack Altman: Yeah, it's a great question and it's well framed.

I would say the goal to me is of those three buckets of, I'm thinking about me, I'm thinking about the customer of the business, or I'm living in this aligned middle. The craft of management is getting people to spend as much time in the aligned middle as possible. People are people. People have incentives.

People are driven by what they're interested in, by what's good for them. And so the goal of management is to have people in roles where what is good for them is also good for the company, and that is eminently achievable. Particularly with, like we talked about, you know, having hard conversations with people, with, with, in some cases being willing to tell somebody who you know is super talented and great that we just don't have a place for you at this company because we don't have the shape role you need. 

And so there are cases actually where we talked before about the, the quadrants. And, you know, somebody who is a high performer, high growth. There are unusual moments where you might need to not have that person at your company because you don't have a role that matches them and they're never gonna be satisfied with what you have.

And that's not gonna end up being worth it over time. And so some of this too goes back to starting with a bit more discipline on what the right shape of the organization is for the business needs. And making that the premise inside of which you put people into those roles as opposed to a world where you start with people and then you build an org shape that they're all happy with.

Those are very different modes to get to an organizational shape. And if you came through 2021, 2022, with a group of people who, their interests were what defined the shape of your organization. And now you're in 2023, you might need to go back and say, this is the organization shape that we have, and start from there.

And that can be a challenging thing that leads to a lot of uncomfortable conversations, but that's the kind of mindset that's gonna be required to get people to spending 80% of their time in that aligned middle rather than 25%. And so, you know, a lot, a lot of that work will need to happen, but I, I, I do believe it's very possible. Uh, it just, it requires being really explicit. 

Brett Berson: Do you sort of have an intuitive sense of where you are sort of in those ratios and where you kind of want to move your executive team or the company or? We often create the conditions we say we don't want. And I think if you're not mindful of this, you can actually sort of feed the beast.

Or you can be doing a lot of things to actually encourage the behavior that you're actually trying to avoid. Um, more when you're out of alignment in that middle area, you're, you're actually unintentionally or subconsciously doing things that get people to continue to behave in that way. And so, I don't know if there there are other ways you think about figuring out kind of where you are in that state of equilibrium and if you're out of alignment, how you start to nudge the company back in the right direction?

Jack Altman: Well there are both macro and micro ways that you'll know. One macro way you'll know, for example, is just we are a company that was growing quickly through this, you know, hyper-growth period. And it is likely that we experienced the same forces as any other company. And so we should start from a default place of assuming that we have a decent amount of this because we all know we've made contortions along these dimensions over the last few years.

So there, that's one starting point is the self-awareness to know that you are likely not above a lot of this stuff. Uh, I certainly know that we have not always been, and of course never will be, in perfect compliance with this just like any other company would be. There are gonna also be micro smells that you need to look out for.

And so like an example of this would be if you've got somebody who you feel is well pla- if you feel high confidence that somebody is well-placed and that they match their role, and you feel strongly that the company is getting just what they need from that person, but that person is repeatedly unhappy and unsatisfied with it, that's a smell to you.

Same with the other way around. If a person is very, very satisfied in the role and they think everything's going great, you don't, that's another moment for like an honest look. But you can tell certainly when you're in one of the zones because one side or the other's not happy and then it becomes a conversation of how do you look at it.

But so I would start from, I would honestly start from a place of assuming most of us are gonna have work to do on this who have operated through the last few years. And then being really honest with the assessment, when you see these moments play out in individuals, and I go back to the like willingness to have difficult conversations is the key to unlocking so many of these things.

Brett Berson: So I thought one place we could sort of wrap up this wide ranging conversation is maybe to talk about what would you say the thing is or the things that you've changed your mind the most about as it relates to this broad topic of general management? 

Jack Altman: I'm gonna give a somewhat cheesy answer, but it's true.

I mean it. I think I used to conceive of management as people had X amount to give, and that was some fixed amount. And you were going to figure out as a manager, how could you get as close to their maximum as possible. Brett has 45 utility points to contribute. How do I manage to get, you know, at least 40, you know? And I think I started from that mindset.

And I think as time has gone on, I have realized, or have come to believe rather, in the same way that projects sort of fill the amount of time that you give them I do really believe that people end up rising to the amount of potential impact you give them. And I think somebody who you thought had 45 points of utility to contribute under the right circumstances and with the right permissions, with the right structures around them, with the right motivations, can produce 450 utility points.

And I think that our concepts of contribution are, they're too linear relative to what their reality is. And you see this where like you'll hear about like 10x engineers, or we all know that in sales somebody can, you know, produce a, a, a multiple of the, the, the average. 

You know, of course, you know, you hope with an amazing founder or executive that they're producing 10 or 100 times the impact of, of an average, you know, one, uh, if everything goes perfectly.

And so we all know on some level that people are capable of wildly outsized impacts on returns, far beyond, it's not about working 10% more hours because we're not thinking about what are 10% gains. It's, it's something deeper than that. 

And I just have really found that if you set people up in the right ways, if you communicate the right sort of permissions, the right belief in them, the right sort of openness and space for them to be creative and to think outside the box. I, I have really come to believe that you just don't under- we don't know the boundaries of what people are able to produce. And so the exercise of great management is not finding out how people can be 10% more productive, but like multiples more productive.

Brett Berson: And in, in, in sort of, in terms of what you figured out, do you think that is a common set of ingredients or conditions that need to be met or to get the maximum output out of someone? It's, it's actually quite bespoke or unique to what's going on for that individual at that moment in time? 

Jack Altman: I would say both.

I think it is both of those things. It is both bespoke to the individual because everybody's very different. And it is, there's a uniform thing that I think gets you on the right track for everybody. And basically what it is, is that I believe everybody, I'm, this is another, I'm, I'm staying in cheesy land here, but I do believe that everybody has a superpower of some sort. I think everybody has some area of true genius where they are truly world class.

And they might not even know it. You might not know it, it might not be obvious. It might not seem like that relevant to the skill, but I believe that so many people exist at work completely untapped into this thing or maybe a couple of things of theirs that are off the charts.

And part of the role of the leader, or a manager in particular, is to help people find, hone, and express that. And I think so to that extent I do think it's unique to everybody because it shows up differently for people. But I think it's when you let people get to this place where they're sort of unapologetically themselves and are free to really be, uh, you know, fully expressed in that thing that is off the charts for them. I think that's when you get greatness from people. 

Brett Berson: Good place to end. 

Jack Altman: Thanks for having me here. This was lovely.