Steve Kaufer, the founder of TripAdvisor, sat down with Inc. for an exclusive interview at South by Southwest. Kaufer launched the company in 2000 because he was planning a trip and realized he couldn't find a comprehensive resource for travel planning. After being acquired by Expedia in 2004 and spending seven years as a unit of the larger company, TripAdvisor was spun out as its own public company in 2011.
The site now has more than 150 million reviews, 2,000 employees, and annual revenue approaching $1 billion. In short, the company is anything but a startup, and yet it's constantly developing innovative products, releasing them quickly, and rapidly iterating. Below, Kaufer explains how he keeps the startup mentality strong in every employee.
There are two signs on my door, handwritten messages for anyone who wants to see me. The first says, "Speed Wins." It's an informal motto of the company. Get shit done and get it done faster. There's no point in going slow. The second says, "If It's Worth Doing, It's Worth Measuring." Don't tell me about an initiative without telling me what success looks like in numbers. Not necessarily revenue numbers but something quantifiable and meaningful to the business.
When TripAdvisor reached 60 or 70 people, I realized I didn't know everyone's name any more. The company was getting bigger, and I wasn't sure I wanted to work at a big company, because big companies tend to be bureaucratic. The process of making a decision takes longer because there are more layers. A friend of mine said to me, "You're still the CEO, Steve, you don't have to let it become like that. If it does, it's because you let it."
So now when I do company orientation every six weeks for new employees, one of the slides reads: "We are a small company that just happens to have a lot of people. How would you behave if the company had 50 people, even though we have a couple thousand?" I do my damndest to drive it home in every communication that I want this company to run as fast as when we were 50 people. I'm a little relentless...how can we go faster?
For example, somebody will say, "Well, it's going to take us a couple months to update that program." I say, Really? I would have thought a couple of days. Help me understand why it's more than a couple of days.
"Well I need to write up the spec." I can help you write the spec and we can be done in a couple hours.
"Well, I need approval and signoff from 12 people." Here's what you do: Send an email to all 12 of them and tell them you would appreciate their comments by tomorrow morning, otherwise you will move ahead. Now we have 12 hours gone by on the clock.
"Well, engineering will take a while." OK, I understand there's probably not much we can do about that. That might take a week. So now we're looking at program done in eight or nine days, not a couple of months.
Email is one of the biggest culprits for decisions being made slowly. You send out an email, wait for response, you don't get a response, you send another email, wait for another response. It's just silly that you're emailing someone on the other side of the building. If it's an FYI message, email is great. If you want an answer, get up and walk over. Get on the telephone. Send a text, send an IM. There are lots of different ways to get an answer quickly, and email isn't one of them.
If It's Worth Doing, It's Worth Measuring
I have a computer-science degree, and I think of myself as using it every day, even though I'm more hands off in engineering than in most other departments. I use it by examining data. I love knowing what the data tells me.
A sales rep can tell me, "Hey, accounts A, B, and C are doing really well." I ask, What's the average CPC [cost-per-click] they are paying every day for each market?
In one sense, it's way in the weeds, but the way I look at it is, I want to keep a finger on the pulse of our clients' behavior, because that’s how we make our money. I want to have a finger on the pulse of our travelers' behavior, because that's how we grow our site. I want to give all departments informed advice on where to focus next, based on looking at the raw data.
But you have to ask the right questions of the data. Someone will tell me, "We thought people would click on that new button we added, but they didn't. But when we changed its color, clicks went up 100 percent." I'm like, that's nice--unless 100 percent means we went from four per day to eight per day, in which case it's a failure. So give me the context to know what success looks like.
Somebody will say, "We are going to send out a CRM [customer-relationship management] email to get people to come back to the site and look at the top 10 hotels in the country. We expect a 22 percent CTR [click-through rate] and 15 percent email open rate." I say, OK, but what about when they land on the site? If they land and leave immediately, it means that the more people we got to click, the more we pissed off. The success metric should be that we want 100,000 people to be browsing at least five page views, meaning they had a good experience when they came to the site.
I don't care about CTR--I care about engaging 100,000 people. Pushing down that perspective to all the levels in the organization is helpful, whether there are 50 people in the company or 2,000.