Dave Goldberg, CEO, SurveyMonkey
How to Lead With Vision — What You Can Learn Today from SurveyMonkey CEO Dave Goldberg
Obstacles, opportunities, and the ability to operate amid them: that’s the business of business. Dave Goldberg knows. He does it every day.
After post-college stints in management consulting and the music industry, Goldberg wanted to lead. He had one problem — his young age. But he turned that obstacle into an opportunity.
“I needed to try running something, and no one, at age of 26, was going to let me run anything,” he says. “So I decided to start my own company.”
That company, LAUNCH Media, was such a success that Goldberg ultimately sold it to Yahoo. He went on to become the CEO of a small company called SurveyMonkey, which has grown in size and profit under his leadership. With more than 20 million users, the company is reportedly worth more than $1 billion. In his personal life, Goldberg has two kids and is married to Facebook COO Sheryl Sandberg.
How LAUNCH Media Proved the Doubters Wrong
That’s now. Back then, at the beginning of LAUNCH Media, Goldberg was young and yearning to do big things, so he took the leap. He quit his job in 1993, and started the company with Bob Roback, his high school best friend.
LAUNCH sprang from an idea that was strange then, but standard now: helping people discover music with the power of the Internet. Goldberg and Roback believed that people would want to listen to songs on the computer.
Combining an unproven plan with the struggles of a startup made for an uncertain undertaking. “Most startups fail,” Goldberg says. “And we knew that going in. And we were prepared for that.”
That’s key. To be a good entrepreneur, you must accept that you will fail. If you work hard and get lucky, you might make it, and then you can be surprised. The two entrepreneurs understood this, and it helped them succeed. They were young and they were realistic and they could afford to plunge into the uncertainty.
But not everyone thought that the pair could turn a risky bet into a real business. Many people sighed and said that LAUNCH would never work. The doubters — often investors that Goldberg and Roback sought funds from — said that people would never listen to music on a computer.
The doubters were clearly wrong.
Music weaved its way into the web, and millions now listen on their desktop or laptop computers every day. Just look at Pandora, Grooveshark, Jango, SoundCloud, Spotify, YouTube, even Yahoo Music, which LAUNCH became after it was acquired by the purple Y.
Twenty years ago, Goldberg’s naysayers were wrong. But he doesn’t think that you should completely cast away criticism. You should use it. “You learn from hearing people’s opinions,” he says. “But you also learn from … debating some of that stuff with them, too.” Reasoned argument is to making decisions as a compass is to navigating wilderness. It puts you on the right path.
“It’s not okay to ignore people when they tell you it’s not going to work out, and they have good reasons why it’s not going to work,” Goldberg says. “You need to listen to those reasons. You need to be able to … explain to them why they’re wrong.”
His explanation for why some investors avoided LAUNCH was the generational divide. Younger investors tended to see promise in the company. Older investors often didn’t.
Why did Goldberg believe that the older investors were wrong? He believed that he could, and should, achieve his mission.
“I think what’s really important is having a vision that you believe in,” he says. “For LAUNCH, it was really, ‘We want to change the way that people learn about discovered music.’ We thought radio and TV were completely broken, and we thought the computer was going to allow people to get access to the stuff they wanted without having to hear the stuff they didn’t want.”
Like Goldberg, you should know your mission. A powerful vision puts you in the vanguard of innovation.
How Goldberg’s Grit Landed Him a Big Gig
But Goldberg cautions that a big vision differs from, and cannot replace, small tactics. Your business is like a sweeping song. You can’t ignore individual notes and bars. And you need to sound your own way through it. “The only way to do this is to do it. You can get advice from people who’ve done it before, but learning it yourself is probably the only way to get better at it,” he says.
He sure did it. “In those early years of the business,” he says, “I didn’t have a lot of fun. I didn’t have a lot of free time.” He admits that, in the long term, sacrificing leisure isn’t a good plan for a good life. But his dedication to the company brought it success. Goldberg and Roback took LAUNCH Media public in 1999, and sold it to Yahoo in 2001 for $12 million.
LAUNCH had been founded before Yahoo, so when Goldberg and Roback joined, their benefits were retroactively calculated and the two got more vacation time than anyone else at the Internet conglomerate, even Yahoo’s founders.
After several years working as Yahoo’s head of music, Goldberg decided that he wanted a change. He left his job and tried to figure out what to do next. “I sat at a venture capital firm in the U.S. called Benchmark, and I was an entrepreneur in residence, which is a fancy title for trying to figure out what you want to do next,” he says with a chuckle.
In that time, he got in touch with a group of investors who were buying SurveyMonkey from its founder, Ryan Finley. “I loved the idea that we were helping people make better decisions with data,” Goldberg says.
It wasn’t a snap decision. “I talked to a bunch of people,” he says. But he did it. In April 2009, the deal was closed and Goldberg became CEO of the company.
Why Teamwork Determines the Dream
Goldberg already knew what he wanted to work on. “I saw a great business, but really not much of a team,” he says. At the time, SurveyMonkey had 12 employees. It now boasts 320.
Team building drives Goldberg’s approach. He wanted to create a company culture that could push SurveyMonkey to grow even more.
A big part of that culture is the simple practice of being nice. Goldberg recalls the best piece of advice he’s ever received: “One of my friends, when I first moved to L.A. to work in the music business, said to me, ‘You know, you’re a nice guy. Just remember that. This is a town filled with people that aren’t that nice.’ He’s like, ‘Be nice to everybody.’”
Here’s why: every assistant will someday rise to the senior level, and they’ll remember how people treated them. You want to be the supportive memory, not the scarring nightmare. Besides, being nice to people on your team motivates them.
The Tactics It Takes and the Mission that Makes It
While kindness is king, it can’t run the court alone. Goldberg wants the deck stacked in his company’s favor, and that stacking is called hiring. “I tend to hire people who are good at things I’m bad at and like to do the things I don’t like to do.” He says that you should bring on people who are smarter and more talented than you are. He convinces such people to join him by promising that they’ll have fun, make a big impact, and be part of a mighty mission. Then he does his best to deliver on that promise.
That’s his vision at work, and it works. SurveyMonkey sees 75 million surveys sent in each month. “We’ve barely started on what can be done with it,” Goldberg says.
Beyond his hiring strategy, Goldberg nods to the freemium business model as another big driver of the company’s growth. Most users never fling a single dollar Goldberg’s way. But a few people — and some big businesses like Facebook, Samsung, Kraft Foods, Virgin America — purchase paid accounts. They’re the gas in the tank, moving SurveyMonkey forward.
But even the free users move the company forward. “The more surveys people send out, the more people learn about us,” Goldberg says. “Some of those people will actually come back and create a survey and send it out, so even if our free users never pay us, they’re still helping us because they’re sending out surveys that will let other people know about SurveyMonkey.”
Users essentially advertise for the company. A freemium approach keeps your marketing costs down, thus lifting you up.
These business tactics are absolutely important, but according to Goldberg, none of that matters if you don’t use them to pursue something powerful and meaningful to you. You’ll never achieve real entrepreneurial success without a strong mission. “You need a mission, and a passion for that mission that you believe in,” Goldberg says. With LAUNCH Media, his mission was to change how people discover music. With SurveyMonkey, his mission was to help people make better decisions with data.
“You’ve got to be able to sell people on that mission,” Goldberg says. “Investors, employees, journalists, customers — everyone’s got to believe that mission.”
The Big Stuff—What to Remember
Do you want to succeed? Do you want to transform obstacles into opportunities? Take these tips from SurveyMonkey CEO Dave Goldberg:
- Learn from other people’s opinions. Don’t reject doubts outright. See if you have logical reasons why your idea will work despite concerns that others raise.
- Be nice. Holding your team together pushes your company forward. Demoralized resentment chains you down.
- Think about your tactics. Specific business actions are the daily steps of your journey. Keep putting one foot in front of another, and be smart about it.
- Don’t lose your vision. You need to step forward every day, but you won’t go anywhere without a map. You must have a mission. Figure out why you’re doing what you’re doing and why it’s important, and then sell everyone on that deep belief.
- Leadership 101
- A key secret that Dave applies to his startup and business life that has held him in very good stead
- How to build a great team
- Why the SurveyMonkey business model is so successful
- What it takes for a startup to succeed
Full Transcript of Podcast with Dave Goldberg
Nathan: Hello and welcome to the “Foundr” podcast. Hope you’re all having a great week. Things have been pretty crazy for me this week, I’ve had to move house, had some interesting and exciting emails that have come through that I’d like to share with you all and yeah, things have just been crazy. I just wanted to start off with telling you a little story. Today I actually received an email from Apple, and this email is essentially the golden ticket to…as an app developer, you see so one of the most hardest things when you create an app is getting it found, marketing it. I think a lot of people think you just come up with a great idea with an app and just put it in the store and you make millions of dollars. Well that’s actually far from the case and pretty much all the most successful apps or the most successful developers are the ones who just keep producing more and more apps and they just keep working and iterating on creating new apps and games and whatnot. Or, alternatively, they keep working on that one app. There’s actually some really interesting studies shown that show the longer time people spend on working on their app, you know, marketing it, growing it, building it, iterating, the more money they end up making.
The longer that they stick around, it turns out that the longest developers around tend to be successful with their apps. Where am I going with all this? Well, I actually received an email from Apple today telling me that they really like what I’m doing with “Foundr” and they’d love to feature it on the front page of the “Apple Newsstand” which is the section for the digital magazines. So, I was just absolutely ecstatic. I was just like, “Wow, this is like a golden ticket.” I reckon about…I read some statistics say like one in a 100,000 get this email and, you know, a lot of people try and get featured by Apple for their connections and a lot of people write about what this special, I guess, secret source is to get featured and I just wanted to share with you, you know, how and why I think that has actually happened. Why Apple have come to me and said, “Whoa, hey we really like what you’re up to and we want to show off the stuff that you have created to make us look great.”
And I was blown away by that. So, if there’s anything you can learn from me, and how to get your app featured or how to actually get recognized for your work, it’s pretty simple when I sit back and think about it. It’s just showing up every day, don’t listen to the doubters. Do you know how many people told me that “Foundr” was a stupid idea or they thought it was just some stupid pet project or, you know, that it would never work and then here I am. I’ve left my job, “Foundr’s” a profitable business and I get to interview some of the most successful entrepreneurs around the world, and I’m just having a lot of fun doing it. So, if there’s anything you can learn from me is that your product matters, you know, it’s not going to explode after day one. You’ve got to give it time, you’ve gotta learn, you’ve gotta speak to your customers, you’ve gotta find out what their deepest desires, frustrations, problems are. And speak to them, find out what you can give to them.
Keep iterating your product, design matters. If there’s anything that somebody always comes to me about “Foundr” if it isn’t about the content, it’s the design, it has to matter, especially when it comes to making an app. Lastly, keep showing up every single day, don’t listen to the haters, don’t listen to the people that, you know, are negative about what you’re doing, or try and talk down to you and think you’re an idiot because at the end of the day if you believe enough in the vision, and you keep showing up great things will happen to you. I promise you that. The big wins will come but it takes time, you have to be patient. So, that’s it from me and what’s been happening with me this week, yeah it’s been a great week. Hope you’re all having a great week too.
So that brings me to today’s guest, you guys are in for a treat. We have the CEO of Survey Monkey, Mr. Dave Goldberg and I was lucky enough to speak with him around how he’s grown SurveyMonkey into a billion dollar company. He shares with us around his journey as an entrepreneur and how he turned LAUNCH Media into a company that was IPO’d and sold to Yahoo. He shares with us some of his greatest secrets into building an awesome culture, and awesome team at SurveyMonkey. Finally, he talks to us about the vision and how important it is. So sit back and enjoy guys because this interview is a game changer. I’m really fond of it and I hope you all have a great week. If you’re enjoying the podcast, please leave us a review, tell your friends, tell your family and if you want to check out “Foundr Magazine” you can at FoundrMag.com/iTunes, that’s for iPad and iPhone and iPod. And for Android devices, it’s FoundrMag/Android. That’s it from me today, guys. Have a great week and now it’s time to jump into the interview.
Today I’m speaking with Dave Goldberg, he’s the Chief Executive Office of SurveyMonkey, the leading provider of online survey solutions. Dave has been a successful entrepreneur, investor and technology and music industry executive. He has run and successfully grown several online consumer businesses. Dave, I just wanted to say thank you for taking the time.
Dave: No, it’s great to talk to you.
Nathan: No, it’s an absolute pleasure. So, can we just get started on how you ended up doing the work you’re doing today? Can you give us a rundown of how you got started on your journey through as an entrepreneur?
Dave: Sure, well in some ways it started here in Sydney. After university, I worked at Bain and Company, the consulting firm and I ended up coming down to Sydney to help open the office here. Decided I didn’t want to be a consultant forever and ended leaving here and heading back to the States and getting a job working at Capitol Records in L.A. in the music business and then from there decided that as much as I was interested in the music business, I needed to try running something. And no one at the age of 26 is going to let me run anything, so I decided to start my own company because that was about all I could do to try running something and I had this idea that the discovery of music would be a lot better on the computer than it would be on radio or on television. This was 1993, a long time ago. I quit my job and with my best friend from high school started the company. Borrowed money on my credit cards, worked out of my apartment, asked everybody I knew for favors and that’s what people did. Now unlike today, I really didn’t know anyone who had ever started their own company before, so…
Nathan: Unlike today you didn’t really know anyone that started their own company. Wow so entrepreneurship wasn’t really that big back then?
Dave: I mean, they probably were I just didn’t know anybody and so…and I certainly didn’t know people who’d raised financing to do it. And there was no…there weren’t internet companies back then. There was AOL and CompuServ in the U.S. which were sort of dial-up type of services. I mean, we raised money from friends and family. Those were the only people who will give you money on just a business plan when you’re 26 years old back then. But we were able to build a prototype and show people what we wanted, and then we were able to raise some more money and eventually, you know, start hiring people, eventually start paying ourselves. And the business grew more and more successful online music companies. And eventually I took it public in 1999 and sold it to Yahoo in 2001 and I stayed with Yahoo for six years running that business until I decided it was time to leave Yahoo.
Nathan: And then you joined SurveyMonkey, is that correct?
Dave: Yeah, well I spent about a year and a half in between Yahoo and SurveyMonkey trying to figure out what I wanted to do next. I’d really been doing music for 13 plus years and I didn’t really have an idea what I wanted to do next. I knew I didn’t want to keep doing what I’d been doing. I looked at a lot of different things and at the time what I did was, I started a venture capital firm in the U.S. called Benchmark and I was an Entrepreneur in Residence which is a fancy title for trying to figure out what you want to do next. So I looked at a lot of different things and I got approached by a couple of the investors who were in the process of buying control of SurveyMonkey from the founder and they approached me and said, “Hey, we’d love for you to help us take a look at this.” I started looking at it. I knew the product, I liked the product but definitely thought about it as a business. It turns out it was a fantastic business with a huge opportunity ahead or it, but it was only 12 people at the time and so they really hadn’t sort of taken advantage of what could be done with the business because it was just a small team, but it was a great business, it was very profitable, generating a lot of cash and there was just so much more that could be done with it. So I signed up, I said I would become CEO, I invested some money in the deal and in April 2009 we closed the deal and I started on day one with my 12 employees and me trying to figure out how to take SurveyMonkey to the next level.
Nathan: I see, and how many employees do SurveyMonkey have now?
Dave: We’re about 320. We hired a lot of people, we brought the margins down, but they were pretty high before. They’re still pretty good, we’re still quite profitable but not quite as high as they were originally.
Nathan: I see, so there’s a lot of really interesting things I’d like to unpack there. The first thing I’d like to delve into is your first business, LAUNCH Media. So you launched that in 1994, and I wanted to know, what were your biggest challenges with that business? It got acquired by Yahoo. What was your biggest challenges in the start because it’s not that often that you build a startup and it gets acquired by a big company like Yahoo. That is kind of…it is rare.
Dave: Well, I mean, first of all it’s certainly not something you can plan on, so I guess what I would say is, you certainly don’t go into these things planning to get acquired or to go public, or to make a lot of money, you go into them because you’ve got some other motivation. I always encourage people if they’re thinking about becoming an entrepreneur because they want to make a lot of money, they should find a different line of work because being an entrepreneur on a risk-adjusted basis is not a very good path to making a lot of money. You may make a lot of money as an entrepreneur, but the likelihood is you won’t and it’s hard. So the same thing is true with getting acquired by a big company. The irony of being acquired by Yahoo is that we actually started our company before Yahoo did, they started after we did. And I know this because we got acquired by Yahoo, you know, seven and a half years after I started the company and they backed up the official start date for calculating my benefits at Yahoo to the day that I started LAUNCH and it was so my partner and I we got more vacation than anybody else at Yahoo including the founders of Yahoo because we technically were there earlier.
You certainly can’t be acquired by a company that doesn’t exist. Look, you’ve gotta build the business and you’ve gotta do it one step at a time and I think what’s really important is having a mission that you believe in. In our case for LAUNCH it was really we wanted to change the way people learn about discovered music. We thought radio and MTV were completely broken and we thought the computer was going to allow people to get access to what they wanted without having to hear the stuff they didn’t want, and that was really important for music. So we had a mission we believed in. We didn’t exactly know how we were gonna do it, we had a bunch of different ideas, those were more the tactics that you would apply and we changed them over time. We started off by putting out monthly CD-ROMS, that was kind of like broadband on a disk with interviews with bands and live performances and advertising, and we were some of the first people to ever do advertising at scale on people’s computers. We were doing it before there were banner ads because you just had to figure stuff out and it seemed like okay this is an opportunity.
The challenges, there were a lot of them. I mean, the first challenge was people told us no one would ever want to listen on a computer, a lot of reputable people, a lot of very smart venture capitalists and advertising executives. People told us no one would want to watch ads on a computer, there’d never be enough multimedia computers to matter and I mean, all sorts of things that people said to us as we were along the way. I made a lot of mistakes on how to raise money because I had no idea how to do it. And every time I finally raised a round and I thought, “Well, that was terrible but I got through it and I’ll be better the next time.” The next round was a different kind of fundraising round, you know, I didn’t do very well in the next one either, you know, it’s not something you can school and someone teach you, unfortunately, the only way to do this is to do it and you can get advice from people who’ve done it before but learning it yourself is probably the only way to really get better at it unfortunately.
Nathan: I’m curious when you said that you had a lot of doubters, that people like, you know, venture capitalists and people in the industry said that it wasn’t going to work, what you were trying to do for LAUNCH Media, what kept you going?
Dave: Well, it’s not okay to ignore people when they tell you it’s not gonna work and they have good reasons why it’s not gonna work. You need a listen to those reasons, you need to be able to sort of explain to them why they’re wrong and I think we had enough good reasons why they were wrong and why they were missing things, and we had enough people who did believe that what we were doing was good sense that we were sort of able to push past and overcome those things. But oftentimes when we would talk to investors they would be investors, you know sort of more younger investors who were more kind of closer to our age who would be like, “Yeah, of course, we’re gonna do the songs with music on a computer.”
And then they would go to their Senior Partner at the venture firm and they would be like,”No one’s ever going to listen to music on a computer.” And so there were some generational issues but the younger people kind of got it. You get hardened by those things, you push through, you find ways to make things work. We almost ran out of money a bunch of times, we had to get new credit cards to keep ourselves going. You just find ways to make it work but you also recognize that most startups fail and we knew that going in. And we were prepared for that and I think you want to prepare for it not to work, you want to do everything can to make it work, but you want to prepare for it not to work because most startups fail and, you know, we felt like at least even if we fail, we knew there was something there. We’d always be able to go get jobs and so I think part of the ability to take the risk we did is that we were young, we didn’t have families, we didn’t need a lot of money to live on, there’s a lot to that. But part of it was also that it wasn’t that a big a risk that we were taking. The risk got greater after we raised more money and we started hiring people Then it was like, “Wow, I’m asking someone to quit their job and they’ve got a family, and they’re counting on me to sort of have cash and you know this isn’t a profitable company and I’m going to keep raising money and I don’t know how I’m going to do that.” So that got a lot scarier but you figure out ways to make things work.
Nathan: Did it ever occur to you in your mind that you would achieve the level success you have with the businesses that you’ve grown and developed?
Dave: Well I don’t…I think I’ve got a long way to go still so I don’t think…I mean, yeah I feel good about were I’ve gotten to and the businesses that I’ve built, and I think there’s still a long way to go and it’s fun to see what’s happened with online music, that we’ve been proven right and it has sort of changed the way people listen to music and I think we’re kind of on the way to sort of transforming the way people make decisions with data with SurveyMonkey, but still a long way to go on both areas. It’s not mission accomplished yet, but no you certainly can’t start at the beginning with these things and think, “Well this is where we’re going to end up.” Because it’s sort of sounds too crazy. You sort of have to assume you’re gonna fail and if you succeed you’re pleasantly surprised.
Nathan: Oh really? See, you strike me as somebody that would just never give up and you just will make it work no matter what.
Dave: Yeah, yeah that’s absolutely true but I still sort of, I knew the odds and I knew rational that there was a very good chance it wasn’t gonna work. So I was gonna do everything I could to make it work but I was sort of resigned to the fact that there would be odds were against it and I ended up beating the odds. And I remember one point in time, I think the odds were like 95% of startups in the U.S. fail within five years, and we got to our five-year mark and we hadn’t failed I said, “Well we’ve beaten the odds to this point.” But we still didn’t you know, have a profitable company, we had a successful company at that point in time but it wasn’t profitable. So, when you really kind of feel like you’ve made it is when you start generating profits and then that’s kind of long-term sustainability and that took me to actually being a guy who just sort of generates profits for the business.
Nathan: I see, I’m curious, just one more thing I’d like to ask you on that first business before we jump into SurveyMonkey, it’s what have you had to sacrifice to get where you are?
Dave: You know, I think certainly those early years of that business I didn’t have a lot of fun, I didn’t have a lot free time. I mean, I worked pretty much every day for the first two years and then after a couple of years I started taking one day off, so I don’t think my health was bad, I don’t think I had a lot of outside interests or life that was fulfilled, I mean, it was certainly a very single focused existence. Certainly, that’s not a long-term strategy for a happy life and, you know, kind of certainly have reset my priorities at this point.
Nathan: Yeah, I know because I was reading when I was doing research for this interview as the CEO of SurveyMonkey you always go home at 5.30 p.m., is that right?
Dave: Yeah, yes, yes, spend time with my kids. I’ve learned, I mean I’ve learned that, you know, I can be very productive and get a lot done but not spend, you know, 16 hours a day at the office. And the nature of work has changed too, I mean, so much of it is online anyway, that to say I go home at 5.30 p.m. is true, but I don’t stop working for the day at 5.30 p.m. I have dinner with my family, my kids go to bed at 8 p.m. and then I’m usually back online for a couple of hours after they go to bed. So, it’s not a 9 a.m. to 5 p.m. job but it is like important to sort of be with my family, you know, for dinner.
Nathan: Let’s switch gears and talk about when you joined SurveyMonkey. When I think of online surveys and I think this is the case for most people, they think of SurveyMonkey.
Dave: That’s what we hope.
Nathan: Well, you mentioned briefly that some people that were buying the business attracted you to become the CEO, what was your main focus behind joining that business and wanting to grow it?
Dave: Yeah, I mean, I saw a couple of things with it, I saw like a great business, but really not much of a team and so it was kind of a chance to sort of, you know, build a team and a culture which I really like doing, but I was already starting with a great business and so that was kind of a nice thing and and I was able to do things that I wasn’t really able to do in my first company which was to, sort of, hire ahead of where the business was at that point in time, knowing that the business was able to handle the kind of growth and I was able to hire, you know, very senior people into a 15 or 20, 25 person company knowing we would get to be a couple hundred people eventually and telling them that’s were we were going to end up.
So, that was a great thing and secondly just having a big impact and having a mission that I believe in is really important to me. That’s sort of what motivates me and allows me to motivate other people and so I love the idea that we were helping people make better decisions with data and that just got me very excited as a very broad mission, but that we were