Dharmesh Shah


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The Long Shadow Of The Valley Reaches Berlin

By Dharmesh Shah on June 26, 2013

This following is a guest post by Jonathan Gebauer.  Jonathan is the founder/CEO at exploreB2B, based in Berlin, Germany.  

There is a lot of talk about startup hubs world wide – the places where the next Facebook will originate from, the next Instagram, the next Pinterest. I am from one of these places, Berlin, the capital of Germany. There is no lack of technology startups in this city.

But to be a place where new technologies and innovations thrive – well, there are a lot of things missing.

I was born in Berlin, I live here and we founded exploreB2B here. I breathe the air of this city and feel at home. But when we started, the air tasted different – I thought I could feel a vibe in the air that consisted of innovation in the startup scene. Today I know: this taste was more hype than vibe.shadow megaphone

A story that got me thinking

Let me start with something that has recently happened to us, and which inspired me to write this article. I received an email from a US based VC which read: “Hey, we love what you are building at exploreB2B, let us know if you would like to talk to us.”

(I am sure Silicon Valley startups receive these every week.)

So far so good – naturally I wrote back. When they found out that we are located in Germany everything turned stone cold. They replied how sorry they were but since we are located in Germany, they would need to inform their European team and they would get in touch.

Their European team never got in touch. So far, not so global.

This is no big deal – it just got me thinking. Why is it that the European arm of a Venture Capital firm seems to think and act so differently from their U.S. counterparts?

This also was not the first time something like this happened to us. The story of our PR failures has already been published. We Berliners often make ourselves believe that Berlin will become the “next Silicon Valley” – but being second does not matter. Silicon Valley is not going away – so: who cares about Berlin?

The exceptions: Berlin startups that reached international fame

There are, of course, exceptions to the general rule. Innovative tech companies that reach international fame and success. Let me list the few that come to my mind: Soundcloud, ResearchGate, Aupeo, Wooga.

The same timespan in the US has brought us: Facebook, Instagram, Pinterest, Dropbox, Zynga, Box, Yammer, Foursquare, Twitter, Quora, Groupon, LinkedIn… The list goes on.

There are a lot of things missing here. And the successful cloning of successful US startups (which happened with Facebook, LinkedIn, Groupon, and many more here in Germany) is not the same as innovation.

Tech is not global – why no startup hub can really prosper without Silicon Valley’s support

 

At first glance, Berlin seems to have it all. There are startup competitions every other day, meetups, hackathons, conferences, … There is a network of business angels and investors, the city has had a couple of exits recently. A couple of tech blogs write about the city’s tech companies (both in German and English). With Ashton Kutcher’s not-so-recent investments in Amen and Gidsy a slice of Hollywood glamour was introduced. The area in the city center where most startups reside likes to be called “Silicon Allee” now – noting a resemblance to Silicon Valley.

There also is a lot of talent in the city – talent, which startups can hire. Three universities and multiple “Fachhochschulen” offer a supply of well educated developers and marketing minds while the city’s historic background shows a tradition for risk-taking – including the risk to start your own company.

But technology and innovation needs more than just founders and employees.

It needs a community and this community needs to include established tech people and companies as well as access to the traditional economy. Not just people who are new to the industry but also professionals from companies of any size and stage. It needs access to the likes of Apple, Microsoft, Google. You need to be able to see the shining light of Bill Gates talking on stage. You need investors who have a crap-load of money to invest on nothing but a crazy idea and feeling in their gut. You need access to marketing experts that can give advice, to tech companies that provide exit perspectives.

Berlin does not have those things.

Silicon Valley can provide this to other so called startup and tech hubs. It does so in some cases. But other tech hubs currently only exist by way of Silicon Valley’s support. They get as big and as successful as Silicon Valley allows them to be.

We Berliners might not admit that this is a fact, but we do know it in our hearts. A common first prize in our startup competitions is a trip to the valley. Or office space in the valley. Or a trip to attend a tech conference Or… You get the picture.

The consequences for young companies

 

This situation forces companies in other startup hubs to adjust. In Germany, the Samwer brothers face a lot of criticism for their cloning operations of international and US startups. It is true: they have been involved in cloning Groupon, Facebook, Zappos, Pinterest, Fab, Amazon, and many more. What is also true, is: This is a way to deal with our situation. Cloning companies also means you have access to information on how marketing strategies will perform and how you can achieve growth. When expertise and support is lacking, this is a valid way to replace it.

Another strategy is to prepare for an early exit. Selling your company early for comparatively small sums seems to be quite common in Germany – creating concepts for a global approach is not. The latest example for this is the formerly hyped startup Gidsy (which got famous by the Ashton Kutcher investment) – which just sold out to a competitor in a not so glamorous way.

There is no tech community in Berlin – just a startup community. This makes it hard for companies to break out of the startup hemisphere. Gidsy was criticized for its lack of professionalization, but you have to ask the question: How can a group of crazy founders get professional if there is no community to help with the process?

The few exceptions to these rules are companies and founders that usually readjust their geographic locations sooner rather than later. Soundcloud has offices nearly everywhere, others are moving their operations to San Francisco.

How to bend the rules: A way out for those that still want to think big

 

I do not like rules that cannot be bent – and I do not like to go small when others hit it big. I like to compete and I do not like failure. I did not invent exploreB2B for a small audience and I do not want to think small. In a world where creative minds are thinking up solutions, there are always options to become more competitive.

Those of us being unlucky enough to have founded our companies in places like Berlin, London, Paris or Sao Paolo still have a lot of options – the whole tech industry was created by people who bent the rules but refused to be bent by them.

In the beginning I told you about a VC not noticing where we are located – well, this sort of thing happens to me all the time. I receive emails, tweets, Facebook messages asking me whether I will be able to come to a meetup in San Francisco, or New York, or London… I always answer: “Hey, I am in Berlin.”

Most of the time the next message is: “Ok, give me a call when you are back.”

The way out for us is to stop worrying about Silicon Valley. In today’s world it is like any other place in the world: a place on the map.

I get emails from London, have Skype calls with bloggers in France, worked with a PR agency in the US (that didn’t go so well…), had articles published on an Australian blog (Big thank you to Jeff Bullas).

The community we need is there – you do not have to see people face to face to be able to get their advice. When you are creating a company on a global scale stop thinking narrow. Never limit yourself to the things you can do in your city.

By doing that we will force Silicon Valley to do the same. The big investments might not yet have reached our startup hubs, but they will come.

We need to stop picturing ourselves in direct competition with Silicon Valley – Berlin will never become “the next Silicon Valley”. But it does have its own strengths. As does London, as does any other city in the world. Each one of those places should play on its own strength – instead of highlighting its shortcomings in comparison to the Bay Area.

For Berlin, I can think of a lot of strengths: the talent supplied from universities, its geographic position and its history of being a place where eastern and western Europe unite, its history of being a place where people take risks.

We need to play our local strengths – and remove our weaknesses by acting globally.

Think less local.

We are entrepreneurs, we are founders, we are innovators. We were born to break the rules

What's your take?  What should entrepreneurs do to make tech innovation truly global?

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12 Unconventional Interview Questions Entrepreneurs Should Ask

By Dharmesh Shah on June 5, 2013

Where potential employees are concerned, obviously skills are important. Yet we’ve all seen fabulously talented individuals become a team that was far less than the sum of its parts.

While expertise is important, cultural fit can be just as – if not more – important. It's something we obsess over at my company, result in what we call our Culture Code (that describes how we think about talent and culture at HubSpot).job interview small 2

As a result your interviews should focus on more than just skills and qualifications. You also need to ask questions to probe whether candidates will fit into your organization: Are they likely to play well in your particular sandbox? Will their work style and personality complement your team?

Will they not just survive but thrive in a fast-paced, often-chaotic startup environment?

Do your homework before the interview and you should already have a good sense of whether the candidate has the right blend of skills and experiences to be able to do the job well. So definitely dive deeper into an exploration of talent and expertise, but also ask questions to determine whether the candidate can do the job well in your organization – because hiring even one employee who doesn’t fit your culture creates a culture debt you may never pay off.

Keep in mind how the candidate answers is important, but the conversations that follow– since a great interview is a conversation, not an interrogation – can reveal even more:

1. “What concerns do you have about our company?”

Strange question? Not really. No company – and no job – is perfect for any employee (even its founders.) Every company and every job has its challenges and potential downsides.

The candidates you want to hire don’t think your company is perfect; they’ve done sufficient research to know that while yours is not the perfect company and the job is not the perfect job, yours is a company they want to work for because they can thrive, make a difference, develop and learn and grow and achieve… and be a key part of taking your company to even greater heights.

And as a result they’re willing to honestly share their concerns – because they trust you run a company that values openness, honesty, and transparency.

2. “What is the toughest decision you had to make in the last few months?”

Everyone makes tough decisions. (Well, at least everyone you want to hire does.)

Good candidates made a decision based on analysis or reasoning. Great candidates made a decision based on data and on interpersonal considerations – because every important or meaningful decision, no matter how smart it looks on paper, eventually has an effect on and must be carried out by people.

A company at its core is made up of people. Great employees weigh both sides of an issue, considering the “business” aspects as well as the human impact.

3. “Tell me about a time when you had to slog your way through a ton of work. How did you get through it?”

We all are required to at least occasionally place our noses on the grindstone. Most people can slog through the drudgery because they have to.

The candidates you want to hire can take on a boring task, find the meaning in that task, and turn it into something they want to do.

Great employees turn the outer-directed into the self-directed – and in the process, perform at a much higher level. And gain a greater sense of fulfillment.

On the flip side…

4. “What were you doing the last time you looked at a clock and realized you had lost all track of time?”

We do our best when a task doesn’t feel like work but feels like what we are meant to do.

I have never met an exceptional candidate that didn't at one point have this feeling where time didn't matter. Call it being “in the zone” or “flow” or whatever you want — all great people experience it.

This ability to commit passionately to a project/task is particularly important for high-growth businesses. These moments of high-creativity and high-productivity are often when the best ideas come.

Explore what candidates feel they were meant to do. A lack of experience is less important when a candidate has hunger and drive. And, if someone isn't passionate enough aboutsomething (whether it's related to their job or not) you should worry as to whether there's anything at your company that is going to get them fired up.

Why? You can teach skills… but you can’t teach love.

5. “Describe a time you felt you were right but you still had to follow directions or guidelines.”

Surprisingly, this question can be a great way to evaluate a candidate’s ability to follow and to lead.

Poor candidates find a way to get around the rules because they “know” they were right. Or they follow directions but allow their performance to suffer because they don’t believe in what they’re doing. (You’d be surprised by how many interviewees will admit they didn’t work hard because they felt angry or stifled and expect you to feel their pain.)

Good candidates did what needed to be done, especially if time was of the essence, and later found the right moment to bring up the issue try to improve the status quo.

Great candidates did what needed to be done, stayed motivated… and helped others stay motivated and get things done, too. In a peer environment, an employee who is able to say, “I’m not sure what we’re doing makes perfect sense, but it might, so let’s knock it out!” is invaluable.

In a leadership environment, good leaders are able to debate and argue behind closed doors and then fully support a decision in public, even if they (privately) disagree with that decision.

No employee agrees with every decision, every process, every “best practice”… what matters is how they react and perform when they don’t agree.

6. “What book do you think everyone on the team should read?”

This is one of my favorite questions. It's partly because I just love books and always looking for new ideas — but partly because most great people always have had a book that they found to be super-useful and like sharing with others. If the person can't think of a single book that they'd recommend to others, that's a warning sign. Either they don't enjoy reading — or possibly, they don't think that the kinds of things they need to learn can be found in books. Both worry me.

Curiosity is a wonderful indicator of intellect and, oddly enough, modesty, because curious people are willing to admit they don’t know and are then willing to work to learn what they don’t know. Curious people also tend not to be cynics (see “Skeptics vs. Cynics: Which Are Toxic?”).

Every business needs employees who can set their egos aside and ask questions. Every business needs employees who are willing to say, “I don’t know how – can you help me?”

7. “Tell me about a time you felt company leadership was wrong. What did you do?”

I certainly don’t have all the answers. And I’m definitely not always right. So I want people to question my perspectives; push back when I come to conclusions; ask, “Why?” and, sometimes more critically, “Why not?”

Power is gained by sharing knowledge, not hoarding it, so we make uncommon amounts of information available to everyone in my company, HubSpot. We don’t want to just “win” debates. We want to be right. We want to make smarter decisions and support smarter behavior.

So we want employees who aren’t afraid to take that information and run with it… and challenge, in a healthy way, each other and executive leadership. Especially executive leadership.

8. What does, “This parrot is no more!” mean to you?

Walk around some companies and you’ll hear Monty Python (the quote above), or Office Space, or Spinal Tap, or Seinfeld quotes tossed around all the time. That’s because recognizable quotes are like verbal shorthand, getting across in one or two sentences what normally takes much longer to explain. And, speaking of Seinfeld (of which both my co-founder and I are fans), one of the quotes we use all the time is “Why don't you just tell me the movie you want to see…” (from the classic MoviePhone episode).

The candidate doesn’t have to recognize the quote or cultural reference you make. In itself that’s not important – but if your team has, say, a quirky sense of humor, it’s awesome if the candidate does, too.

And just in case you don’t get much of a response to this question, go to…

9. “What movie, no matter how many times you’ve seen it, do you have to watch when it’s on?”

Same thing. A favorite movie can indicate a lot about a candidate’s personality. I can watch Moneyball over and over because it’s an entertaining movie filled with lessons on business and entrepreneurship.

One candidate may love a story about overcoming the odds. Another may love a comedy. Doesn't matter. The question really helps you learn more about the person (not their skills). This question often leads to a fun, engaging conversation.

10. “Tell me about the last time a co-worker or customer got angry with you. What happened?”

When your company is focused on getting (stuff) done conflict is inevitable. The candidate who pushes all the blame – and the responsibility for rectifying the situation – on another person is one to avoid. Better is the candidate who focused not on blame but on addressing and fixing the problem.

Best of all are the people who admit they were partly or completely at fault (because it always takes two to do the conflict tango), took responsibility, and worked to make a bad situation better.

Every business needs employees who will admit when they are wrong, take ownership for fixing the problem, and most importantly learn from the experience.

11. “What business would you love to start?”

Startups naturally attract entrepreneurs-in-training. That’s awesome: Sure, they may leave someday to start their own companies, but in the meantime your business benefits from their entrepreneurial spirit, drive, and attitude.

And they’re much more likely to fit in to your organization, since they immediately embrace the differences in working for a startup rather than a corporation.

What type of business they would like to start may not matter; what does matter is the fact they have ideas and hopes and dreams – because if they do, they will bring those ideas and hopes and dreams to your business.

12. “What would you most like to learn here that would help you in the future?”

This is somewhat of a follow-up to question 11. If they do have a startup in mind that they'd love to start someday. It's revealing to figure out where they think they need help (finance? marketing? sales?) The other benefit of this question is that it sends a signal to the individual that we care about growing people. The saying at HubSpot is “We don't want to just build a great company, we want to build great people.”

Now it’s your turn: Take a look at the qualities and attributes of your top performers. Think critically about the business culture you’re trying to create. What questions should you ask – and what conversations should you try to spark – that will help you identify the qualities and attributes your business needs? Yours may be different than these – which only makes sense since every company and every company culture is different.

And in the comments below, please share unconventional interview questions you like to ask!

Topics: recruiting
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