Episode #10 — Radiate with Kevin Ryan
Announcer: What defines success?
Kevin Ryan: There's no strategy in startups. It's all just getting stuff done. It's how you do it. So
you don't need a strategy person, you just need people who were gonna do it.
Announcer: What happens when you get knocked down?
Kevin Ryan: I was turned down by so many people when we raised money. In fact, I've raised a
lot of money over time but I've been turned down so many times, it reminds me of my high
school dating career.
Announcer: What makes some people radiate?
Kevin Ryan: I walk into this meeting and I think, "You know what? I'm actually giving you an
opportunity." I'm giving you an opportunity to make ten times your money. And if you turn it
down, someone else gonna do it. And then you'll regret it.
Announcer: This is Radiate.
Overview
Betty Liu: Hi everyone and welcome to Radiate, the show where we interview some of the
world's most successful people to find out how they work their way to the top. This week, Kevin
Ryan. One of the best known entrepreneurs in America who's founded several successful
companies, including Business Insider, Gilt Groupe, Zola, and MongoDB. He also built
DoubleClick into a multi-billion dollar enterprise that was later acquired by Google. If you have
any inkling of starting your own business, you wanna listen closely to Kevin. Because in this
conversation, we discuss everything from how to pitch an investor like him to how to hire the
right talent. Kevin also talks about what it was like to sell his latest company, BusinessInsider for
almost $450 million. Here we go.
Betty Liu: The one thing that people say about you and your brand is you're a serial
entrepreneur. Right? I mean you built so many companies, DoubleClick, Gilt, Business Insider,
which you just sold. What is the secret? How do you do it?
Kevin Ryan: So, the building blocks of a company are really just three things: you've got an idea,
people, and money. So you need to simplify everything down. Obviously I have to start with an
idea, and you know, yeah I feel like it's a good idea. Then you have to build the team. And the
team is actually, really, really important because it leads to money. And those are the building
blocks. You've got to look at that team, I think what do I really need. Each team for me is
different because I started businesses in different areas and you think what are those core
skills. You have to think like a sports team, where if this were a football team you know exactly
what you need for a football team, and a basketball team would be different. I think about
what I need, and I start building that up. And so I put in the initial money in my situations, but
for people who don't have that they need to go raise angel financing, small amount of money.
Betty Liu: What are we talking about, like $500,000?
Kevin Ryan: Maximum, I mean there are many companies that have started with a hundred, or
$200,000. That doesn't take you very far but maybe it gives you enough runway that you can
hire two programmers, and you can bring two people on and build, and show results so that
you can go to the next round, and you have to think of this almost like a video game, where you
know, you get to level one, and you'd master it, then you go to level two, and level three. And
not everyone gets to level three.
Betty Liu: Right.
Kevin Ryan: And so each one of these rounds is a financing round. And if you're building a big
business, you're gonna need a lot of capital. There are no internet businesses that are big, that
didn't take a $100 million worth of capital. And so, you do that in a very strong side. I build that
team out, proof points and then go out and raise money at the right time, from the right
people, and keep going.
Betty Liu: And how do you know an idea really is going to work?
Kevin Ryan: You never know, that's no different. I think that if you ask, a film director, how do
you know your film is gonna be successful. And even great film directors, sometimes they're
right, and sometimes they're wrong. And it's a combination that maybe the idea wasn't good,
or the execution wasn't good.
Betty Liu: Which is it most of the time by the way?
Kevin Ryan: Execution.
Betty Liu: Right?
Kevin Ryan: It's all execution.
Betty Liu: Yes!
Kevin Ryan: I think one of the mistakes that people make and they think their idea is not
groundbreaking. And by the way, most ideas are not groundbreaking. Google was a terrible
idea when you think about it. It was just a search engine, there already were seven. There’s was
a little bit better. That's it. It's not very compelling.
Betty Liu: Right. It wasn't that special.
Kevin Ryan: It wasn't that special. It was a little bit better. But actually search engines at the
time worked pretty well, but Google's worked better. And so over time you switched over, and
it became a very successful...
Betty Liu: Well, I'm glad that you bring that up. So, what do you think gave Google that edge.
They just executed better?
Kevin Ryan: Yeah, they had the idea and the way of doing the search engine was a better way of
doing it. And so the results probably 10% of the time were fundamentally better. 90% didn't
change, but 10% was. And that was enough since I had a choice to use that one, and they're
going to do the same thing overtime.
Betty Liu: I love that Kevin. Because I think most people get bogged down with the idea. Right?
They think, "Oh it was a terrible idea. That's why it didn't work or, or it's not this fantastic
blowout idea so it's never gonna work."
Kevin Ryan: Most ideas let's not forget, are not intergalactic travel which just blows your mind.
Most business ideas that are very successful are starting a new ad agency, and you're very
successful, and you work for a big agency, and you realize that no one is doing healthcare or no
one is doing a good job with some big clients, and you split off. You take those clients, you hire
great people, and you build up an agency overtime. Where you build up a modeling agency,
where you build up a service business, a law firm. So, that's just execution and just people. In
the internet, anytime you have an idea, even if it's a good idea you're gonna launch it in four
months, I'm gonna look at your site, and I'm gonna think, "You know what, I could do that. I'm
gonna copy it. If I think it's a great idea." Because I'm gonna sit there and think, "You know
what? Yeah you're four months ahead of me." But as I sometimes say, if we're starting a
marathon, and I have a hundred yard head start, no one is gonna be intimidated by that. You
would think, "I can take him. He's 52. We'll catch up to him. He looks weak." And so you're not
gonna worry about that at all. That's what I consider your four month head start. And Gilt’s a
good example that when I had the idea and launched five months later, I thought I was gonna
be the only player in the country doing that.
Betty Liu: And?
Kevin Ryan: In the meantime, Ideeli, launched even before I launched because they were
already working on it, but I didn't know that. Rue La La and HauteLook launched at the same
time. So we had four of us at the same time. Now we are bigger than all of them, because of
execution, not because we launched earlier.
Betty Liu: So you knew there were gonna be competitors? You knew that? It's a given.
Kevin Ryan: I assume, hopefully it's going to be six months later. In this case it wasn't, I didn't
have a six months head start. Sometimes I do, like in Kontor which is a company I just did a
launch party for this week. No one else has done it, so I have easily a six month head start. Zola,
same thing. They were already others players out there. But I did it differently. So, I always
assume I'm gonna have competitors.
Betty Liu: So, Kevin take me through, since Business Insider is so fresh on our minds because
you just sold the company for something like $450 million. By the way, did you ever think you
would sell?
Kevin Ryan: I was not planning on selling, I mean I thought at some point, like all companies get
sold in the long-term. I actually did not think we would get sold this early. I thought we would
go public at some point, and someone would buy it.
Betty Liu: Did you think that it would fetch this much money?
Kevin Ryan: Early on I didn't because there were no examples of successful media companies.
So I thought it was a good idea that intellectually I would love a lot, it might be worth a $100
million and wouldn't take a lot of capital. So, that's okay. And then as we got into it, and mobile
hit, and our execution was great, and it got to be so big. All of a sudden, I realized it was more
valuable than I thought. I actually think it will be five years from now worth a billion dollars.
Betty Liu: Okay, let's see.
Kevin Ryan: Yeah, we'll see.
Betty Liu: Well media is, you know, certainly a growing, growing sector. And particularly for
VC...
Kevin Ryan: Yeah.
Betty Liu: People, especially with this whole mobile…everyone is watching it on their
smartphone. When you were starting Business Insider, I mean like nobody liked media
companies, right?
Kevin Ryan: Everyone hated the idea. I had a lot of trouble raising money…
Betty Liu: Okay, how much did you raise, financially?
Kevin Ryan: So, in the beginning we put in a couple of hundred thousand dollars, then we went
out and had very small painful rounds of maybe $500,000 or million dollars. Did an angel round
which I don't like to do, then only after like two or three years, was I able to raise a true VC
round of $3,000,000.
Betty Liu: Did you ever at any point want to give up?
Kevin Ryan: No, it was growing all along. I was only worried that we'd run out of money at some
point. Because you need to fund it. It's like oxygen. You know, when you don't have it, you're
dead.
Betty Liu: Were you at any point willing to put your own money in there?
Kevin Ryan: Yeah, I put money in the beginning, but in retrospect I should have put more
money in, because it was a very low valuation. So any money that someone put in five years
ago, they made 20 times their money.
Betty Liu: Wow, so in the end can you say Kevin, how much did you have with Business Insider
in the end?
Kevin Ryan: So we haven't disclosed that, but there was more dilution than we like. That all
three founders, Henry Blodget, Dwight Merriman and I, ended up doing well. So we're ...
Betty Liu: Right, so you're happy obviously?
Kevin Ryan: Yeah and we made a big, big return on our money.
Betty Liu: Okay, so again take me back to the beginning though. Everybody hated the idea, and
you still went ahead with it. What made you go away with it?
Kevin Ryan: Oh because the fundamentals I thought were there. There was no doubt in my
mind that people were going to be consuming all their media online overtime. That's obvious
now, but not quite as obvious at the time. Still print was huge, still much bigger. Even today,
print is still much bigger than online in terms of subscription revenue and things. So, you had to
assume that was gonna happen, and you had to assume that you could generate revenue and
advertising dollars which at the time was difficult. It wasn't a very attractive category,
advertisers are very slow to switch. They prefer to be on The Wall Street Journal than to be on
Business Insider, so they would pay huge premium there, and so we would get the scraps. It
was hard to get journalists because good journalists ... I had a guy, you know from
Businessweek who just said, "Look Kevin. I don't want to leave Businessweek to come join you."
Betty Liu: I don't know what this is about.
Kevin Ryan:"You could be out of business in two years." And so the irony of course is that two
years later, Businessweek was out of business, but sold for a dollar. I mean if you hadn't
purchased it was bankrupt. And so the irony is that we became very valuable, and Businessweek
which he thought was a safe choice. But everyone felt that way, it wasn't a crazy thought.
Betty Liu: Does that feel good, Kevin?
Kevin Ryan: Yeah, Business Insider in some ways is one of the more validating businesses that I
have started. Because no one thought it was gonna work, because we had so many
competitors. I mean the line I remember is, "Kevin there are 50 business sites in 2007. No one
needs another one." And, they didn't realize that we were gonna offer something different than
what they were doing. And they didn't realize that, when you are online only, you have a
fundamental advantage over anyone that has print. And what everyone in print says, "I have
this big advantage, because I have an existing brand, everyone knows me, and it actually is like
having a weight around your neck." And you're about to run a race with this enormous ...
Betty Liu: With an entourage (laughs).
Kevin Ryan: With an anchor. Yeah.
Betty Liu: Okay, is there a part of you? I notice sometimes with very successful with people…Is
there a part of you, that likes kind of being underestimated?
Kevin Ryan: Yeah, it's very fun. It’s still better to not be underestimated. Maybe because when
people think it's going to work, that it's easier to get money and people. And since those are
two of my big building blocks, we couldn't get people to leave The Wall Street Journal and come
write for us. Today we can.
Betty Liu: But I want to get back Kevin, I won't let you escape that question though. Is there a
part of you that likes being ... Because I wonder if this is what drive's entrepreneurs? You like
being in a way underestimated or fighting the big guy, right?
Kevin Ryan: Yes, I think it's more the latter. I don't think about underestimated. But, yeah ...
Look it's so fun to start something to have this big Goliath there, that everyone think he's gonna
win and that's easier, and people underestimate it. And so then to win overtime is fantastic, I
mean look I was turned down by so many people when we raised money for DoubleClick in the
beginning. I've raised a lot of money over time but I've been turned down so many times. It
reminds me of my high school dating career.
Betty Liu: (laughing)
Kevin Ryan: Many, many, many no’s. My high school career had even fewer yeses. But at least,
raising money, I have a bunch of yeses as well.
Betty Liu: I think that's a big lesson for people. You know what you just said is that you have
been rejected so many times. And you do face these huge players when you're moving into
these new markets. On the rejection side, what do you do when you're rejected? What do you
do when you lose, you know that big deal, or you get turned down?
Kevin Ryan: Yeah, you can't really take that personally, you have to walk out of there.
Betty Liu: That's easy to say, right? It's hard to do.
Kevin Ryan: I mean you're never happy about it, but if you still feel like fundamentally you're
building something great… I walk into this meeting and I think, “You know what? I'm actually
giving you an opportunity. I'm giving you an opportunity to make ten times your money, and if
you turn it down someone else is gonna do it. And then you'll regret it.”
Betty Liu: That's how you go into every meeting?
Kevin Ryan: Yeah and I believe that, I wouldn't be raising money if I didn't believe that. And
that's been true many times, when I raised money for Mongo at a $10 million valuation only
five years ago, and most people turned me down. Today, the last round was at 1.4, 1.5 billion.
Everyone who turned me down regrets that.
Betty Liu: If you were to put a number on it what is it? 80% rejections, 20% acceptances. What
would you say?
Kevin Ryan: Oh yeah easily. Yeah because, even when it goes well, if you go out to ten or twelve
VCs, you're obviously only gonna get one at the end. You might have two or three that are
interested. The reason it's hard to define rejection, is that if I'm raising money let's say at a $50
million valuation, you might not completely reject it. You might say, “That's too high a price for
me. I'm good at 30, I love your business, I want to ... That's just too expensive.”
Betty Liu: I see.
Kevin Ryan: And then look, sometimes you're right, later on sometimes you're wrong. But you
also have to think of this the way you would, if you were playing baseball. And if you say I just
can't strike out ever, emotionally. Then I would say, you can't play baseball because the best
player in the world probably strikes out one in every two times. And so don't play the game, if
you're aren't willing to do that.
Betty Liu: So we got to the point of asking you a little bit about how do you start a business?
So, very key right, money and people being able to handle rejection and...knowing how to
stay with your vision. So what about on the flip side. And you meet an entrepreneur Kevin,
who wants to work with you, or wants you to fund his or her business. What impresses you?
Kevin Ryan: What impresses me is a track record of success. Now it doesn't mean that they've
started a company before because almost most entrepreneurs are first time. But I have to walk
out of the room and think, "Can this person persuade other people to come work for them, and
feel good about them?" Because again if you flip it around, they need to be able to get people
and money. And obviously assume we like the idea. But they have to get those two building
blocks, and because no one person can do everything. You can't be the best CFO, CTO, CMO, all
those things. So you're probably good at one thing, you the founder. But you have to hire all
these other people all the time, if it's going to be successful. So that management skill is really
important.
Betty Liu: And how do you judge that just from one meeting? Do you?
Kevin Ryan: So first of all, your interview matters a little bit, but what matters, you can see,
things you've done in the past. If you come in and say, "Yeah I work at this job, but there are
layoffs, I got let go, and then I went here, I joined a startup, it didn't work." And there's not a lot
of track record of success there. So I rather have you say, “I was working here. My boss moved
to another company, and then hired me.” That's good that someone endorsed you. A lot of it,
it's gonna be references. I've said many times in the interviews, that interviews are less
important than references. If I had a choice, between interviewing you for a position, or not
even being able to meet you, but do a lot of reference checks. I'd rather do reference checks.
Betty Liu: You know I hear that a lot from CEOs and interviewers.
Kevin Ryan: Everyone overvalues interviews. Interviews are a test of how you interview. Let me
use another sports analogy. If we're trying to pick a good soccer player, how important is the
interview? Not important at all. He's gonna say, "Yeah I know how to score goals." Like, "Great,
let's watch him play soccer." And then we'll get a sense of whether he's good. That's what
matters. And so, here I can't watch you in your meetings, but I can talk to people who worked
with you. And all of us know when you were a manager level somewhere, and you had six
managers that you and your peers ... If I said to you, were they all the same, your peers? Like
no, I'd rather work with Mary, because she's great to work with. The second I would work with
her again and Pete was a jerk, and I don't want to work with him anymore. Or didn't work hard,
or had no attention to detail. All those things that you can't judge…how do you judge attention
to detail interview?
Betty Liu: You can't. So, when you say references, you're not even talking about saying to the
candidate, I want your references. You're talking about, "Thank you very much Susie." And then
you go around and find people who know Susie, right? Is that what it is?
Kevin Ryan: Yes. That's really the point.
Betty Liu: Okay.
Kevin Ryan: Now there are certain things you can tell...as we discussed earlier. If they've been
doing well, if you joined the company and were promoted four times. That's a pretty good
reference. You know if someone thought you did a great job and kept thinking that. So, I still
want to know some elements to that, but that's a good start.
Betty Liu: Okay, so, you look to see if the person basically has a vision, is able to bring other
people onto his or her vision. But when you are meeting with them, and they pitch you an
idea...what are the dos and don’ts? What do you tell entrepreneurs? Do this, don't do that.
Kevin Ryan: I want them to be mostly focused on the idea and the product. I don't want to be
hearing about how we can sell this to someone, for $50 million. That's ...
Betty Liu: That's a mistake number one.
Kevin Ryan: Yeah. But what they should be thinking is, I have a clear product vision in my mind.
This is going to be a great product, this is why it's better than what's out there. And you push on
that, and you should come away thinking, "I see why this is gonna be different...and this is how
I can execute it." Because there's no strategy in startups. It's all just getting stuff done. Because
generally you have a strategy, like Business Insider, there's no strategy, we're gonna write
business articles, we’re covering things. It's how you do it. So you don't need a strategy person.
You just need people who are gonna do it. Or if it's a product, like for Kontor or for Zola, it has
to be ... This is what I'm gonna built, and this is why it's gonna be better than what's out there. I
personally don't do a financial model.
Betty Liu: You don't?
Kevin Ryan: And I'm a former CFO and I have a CFA. But I actually don't put a financial model
together. We need to pull one together once we raised outside money, but I don't think about
that. Because the financial model early on just doesn't make any sense at all. You know?
Betty Liu: You don't know enough.
Kevin Ryan: You don't know enough. If you are starting a restaurant, you can put a model
together. There's only one variable that matters, which is how many people are gonna come to
your restaurant. So we need to focus all of our time, on that one or two key variables. I know
that if your restaurant is full every night, you can be an idiot and probably make money. But if
your restaurant is empty, you can be brilliant at managing cost and you're not gonna make
money. So I wanna focus on that issue. Is the dog gonna like the dog food? Are the readers
gonna like this? And so in Zola there what I needed to have was not a financial model. I had to
have a clear idea in my mind, a product vision. I know what this product’s gonna look like, and I
feel good about that, and it's gonna be different and better. I felt that way for Gilt, I felt that
way for Business Insider, I felt that for Zola.
Betty Liu: So before we go. I've been asking people this. And for you, it would be...going back
to the whole starting the company. But let's just kinda repeat this a little bit. But maybe have
something more concrete. Like tell me step one, two, and three for someone to start a
company. And I get the whole, get the money, and find the people. But, let's drill down
beyond that, how do you find the people?
Kevin Ryan: Step one though is locking down their idea. And so they have to have an idea and
then they have to do work on that idea to make sure it works. And so obviously there's many
different types of ideas, but they need to talk to customers, potential customers. They need to
understand all the competitive landscape, the direct competitors or the substitutes. So if you're
starting a new website, you know how is it gonna be different, what are people doing today,
how they're solving their problem. And so they really understand that. Understand eventually
there has to be a model behind this. So, some ideas don't end up producing revenue. So you
have to have a clear path to know if I am successful and people liked my product, how do I
monetize it overtime?
Betty Liu: That's step number one, lock down your idea. Okay what's step number two?
Kevin Ryan: Step number two is, then let's say you've made the decision that you've done this
research and you're gonna do it. Then you're starting the building phase. And the building
phase is, “Okay what needs to happen right now?” If it's an Internet idea, someone’s gonna
have to build a website. And so then you're getting into the people right away. So, by the way,
you incorporate a business which takes you know 20 minutes, so that's a non-issue. You setup a
company, then you need people. You need people to do work.
Betty Liu: How do you find them? Just friends? People you know, contacts, how?
Kevin Ryan: I often start businesses for better or worse, in areas I haven't worked before. You
know if it's a healthcare side, or journalism side I've never done that before. So I don't have a
deep network.
Betty Liu: Which is unusual to do that.
Kevin Ryan: Yeah, and most people would be starting something in an area they know, which is
very sensible. So then you think, "Okay you need to have a concrete idea of who's this first
person that needs to come work for you." So in some cases, for me it's an engineer, in some
cases it's not. Let's say it's an engineer. What skill base do you need? It's got to be someone
who can build the website the way you want to if you've sketched out what you need. And so
you think, where is that person working today? What's the comparable skill base? So, this
person is working at another wedding registry site, or a consumer site let's say that is aimed at
women, that would be ideal. And so then, I put a list of the ten companies that I think this
person is working at. And then I start going to find that person, and I think of how senior I want
the person. So for a healthcare company I'm starting right now. We need someone who is not
quite a CTO level but can build a website right now and so they need to be working at a
consumer site, and they have experience using current tools and so we need to go out and find
that person.
Betty Liu: And you cold call them? You e-mail them?
Kevin Ryan: Friends of friends, and so once I have a list. If you gave me the list of the ten
companies you think this person is working at right now. Then I need to think who do I know at
those companies. If it's no one, then I go ask people, “Do you know someone that works at this
company?” And you should be able to get there. Like for Business Insider I started by saying I
want somebody who works at Fortune, Forbes or Businessweek. I went out there and friends of
friends introduced me to people. And I wanted someone who is probably gonna be mid-level.
My ideal person was someone who is going to be the editor-in-chief, five to ten years from
now. Everyone was like he or she is an up-and-comer. They're not there yet, they're mid-level ...
Betty Liu: But then how did you come up on Henry Blodget?
Kevin Ryan: So Henry was an unusual choice, it didn't fit my profile because I went, and I
interviewed like seven or eight people. And I couldn't find the right person. There was no one I
felt who understood that we needed to do something different and…understood the vision and
so I basically struck out. I’d been doing it for about five weeks. Hadn't found the person. I
thought of Henry. Henry is someone I knew, but it was not the model I was looking for, because
he wasn't traditionally a journalist, but he was a great writer, financially oriented, super smart
and had a blog that was great. And so I thought, "Let me try that. And talk to him about it." And
in two minutes, unlike my other conversations, he said, "Oh my God. We should do this. This is
a great idea. Totally get it."
Betty Liu: Hit it off.
Kevin Ryan: Hit it off, you know intellectually on the idea, and he said, "We should do this." And
I want to do it, and he said, “I'll work for no money to get more stock because I'm so committed
to this idea.” And I thought, this could be great. And I knew at the time, it was either gonna be
one of those sort of off-model ideas that's brilliant or a terrible idea. And in general, you never
want to have a non-journalist managing journalists. It's the same way that when you're running
university. If you're not a PhD, people tend to not trust you, or they're easy to say, "He doesn't
really understand what we're going through."
Betty Liu: But this worked somehow.
Kevin Ryan: Yeah this worked. And it turned out that Henry was actually a natural journalist,
that really is his calling. It is who he is, and people forget now that he's been doing it for so
much longer than he was ever on Wall Street. So this is, what he was made to do, and I think
Henry will be a journalist you know 15 years from now.
Betty Liu: And by the way, we didn't get into this. But, he did not have the best of reputations.
Kevin Ryan: In some ways yes, in some ways no. I mean, what you're referring to is on Wall
Street in terms of the analyst but that actually didn't bother me at all. Because I saw what...I
dealt with all the internet analysts, and I know he was not doing anything different than every
single other analyst.
Betty Liu: He just got caught.
Kevin Ryan: He got caught and ironically I would argue that the reason he got into trouble is
because he had angst over what everyone is doing, and wrote an e-mail saying, "You know...
Why am I being forced to recommend this stock that I don't think is any good." The other
investment banks, the other people didn't do that. They just recommend it, even though they
hated it. I had people coming into me as a publicly traded CEO saying, “Basically we'll write
anything you want as long as we get the investment banking business.” Every single one of
those companies did that.
Betty Liu: He just happened to have a conscience about it.
Kevin Ryan: Yes and Merrill Lynch threw him under the bus, but no, he was doing nothing
different…and by the way, no time did anyone suggest he was doing something that his bosses
were not aware of, every single step of the way. As you know nothing gets written by a Wall
Street analyst without two levels of people approving every single thing. Why Henry got into
trouble for that, and not the boss who said, "Great idea." And the council as well. I don't know.
Betty Liu: By the way, I think people look at that, and they see Henry's career and how it got
revived by Business Insider and they say, "There is room for second acts." You can do
something which I mean you know, let's be truthful here. It was still wrong what he did. But you
can have a second act, and you can come back, right? And I think that's important for people...
Kevin Ryan: Yeah and I still think it’s wrong what the investment banks were doing and he's one
of the many people part of that. But he didn't invent anything, didn't create anything. There
was a structural problem there. You know, I could argue there are many structural problems in
investment banks. You know, when a bank takes you public and gets paid by the person buying
your shares...the incentive structure is all wrong. No one seems to think that's illegal. When I
went out to take a company public, and I go to five different investments bank, and ask them,
how do you get paid on this? And the first one says, I take a 7% share and the second one is 7%,
the third one is 7%. And I ask all of them how about 6.5%? And not a single one will go to 6.5%.
That's what I would call price fixing.
Betty Liu: Collusion.
Kevin Ryan: Yeah. Is that legal all of them are doing it? So, I think Henry is in the same category
of all those things that are accepted practices on Wall Street, until they get changed at some
point. So I actually don't hold Henry responsible for those things and I think and he's done an
incredible job of Business Insider and has been fantastic to work with.
Betty Liu: Okay, so, get the right people, and the third, final thing Kevin is what?
Kevin Ryan: So, you have people, then it's all execution, because you have to manage them,
have them work together, and build the right product. So, somewhere there, you're gonna be
building something and creating it. And people have to work together. So if someone is
marketing and someone is coding and someone is creating the product and someone is adding
up the money, and all of those things have to work together. And I've seen teams that are
poorly managed, and there's infighting, and there's a lack of trust, and that's just management
skill that you know people have to do that, and we've all seen teams that were great.
Whether they’re sports teams or companies, and we've seen ones that didn't work well. And
that's management...There's no one formula for that. But there has to be trust, there has to be
cooperation, there has to be decision making. There are difficult decisions like after three
months you might decide that this guy right here is very corrosive and even though you hired
him, he's not the right person.
Betty Liu: You let him go.
Kevin Ryan: You need to let him go. And some people don't have the confidence to do that.
Betty Liu: So, what kind of manager are you? Like how would you describe yourself? How do
you get people on board your vision? What would people say about Kevin?
Kevin Ryan: So you’d have to ask them, but I think you have to be laying out a clear vision and
clear priorities and keep the focus on that. You can't be wavering back and forth...but on the
other hand, this is where it's very hard. Because on the one hand, you can't change all the time.
On the other hand, if something is not working, you need to change. So how do you decide.
That's the judgment...If I said to you, how does someone pick a good stock, you know if there
was a formula, you know, we'd all be Warren Buffett. But, he doesn't have any tools that we
don't have. He's just better at doing it. You know, I can shoot a three pointer, and LeBron James
can shoot a three pointer, his goes in..
Betty Liu: (Laughing)
Kevin Ryan: Mine doesn't. But, I can see what he's doing. I just can't do it. And in management
it's the same thing, and we've all worked for people in the past that you like to work for again,
and then there are examples where you're like never again would I work for that person.
Betty Liu: All 100% true. I ask you that because you know I think it's a little bit different,
between men and women. I think women still, when they lead, they want to be liked, right? Or
they more lead by emotion, and I don't want to stereotype them, but that is true…
Kevin Ryan: Yeah but look there are so many different styles that work. And think of the many
CEOs or people you've worked for or followed ...
Betty Liu: Or interviewed.
Kevin Ryan: Or interviewed.
Betty Liu: Yeah.
Kevin Ryan: Very different, and so I don't think it's about one style at all. You know there are
some people who are more military command and control but clear path, and that's fine. They
are more very collaborative and it's great. You know interestingly out of my companies, out of
seven companies, I have four female CEOs. And we just looked at the survey the other
day...that out of the 580 companies that got Series B funding in the Internet space, only 5% had
female CEOs.
Betty Liu: Wow.
Kevin Ryan: But there are many talented people out there...
Betty Liu: That's sad...But I mean those numbers are changing though.
Kevin Ryan: They're changing, they're not changing as fast and it's not as if you separated
between enterprise and consumer, it's very different. So in enterprise, much more technical, far
fewer women. In consumer, they're many women now, increasing number of women and that's
great.
Betty Liu: Next week on Radiate.
George Zimmer: You're going to like this podcast. I guarantee it.
Betty Liu: It's George Zimmer. The founder, former CEO and pitchman for Men's Warehouse.
Zimmer reveals what it was like to get sacked by the very company he created 40 years ago.
And how the best revenge is coming back a bigger success. Thanks for joining us, I'm Betty Liu,
if you like what you heard. Please review us on iTunes and also don't forget to subscribe. You
can find me on Twitter, Facebook, Instagram and LinkedIn. See you next week on Radiate.