High-Hanging Fruit

by Mark Rampolla

  He told me he loved Zico and that he regularly swapped with Chris Michaels, my sole sales rep, two cases of Vitaminwater for one of Zico. He said I shouldn’t give Chris a hard time, it’s just how the business works and that all the different brands at Big Geyser watch out for each other on the streets. He said, “A lot of our reps love Zico, and I assume you know half your consumers are drinking it as a hangover cure. How the hell did you come up with the idea to start a coconut water business?” I told him my story starting with my time in the Peace Corps and about making an impact on people’s health, creating good jobs in tropical countries, and creating a great place to work. It all seemed to resonate with him.

  I also learned some insider stories about his years at Vitaminwater. For Andy, it had been a fun and fast ride for sure but he felt something was missing. The company’s culture pushed the limits of excess and even decadence. Their weekly office parties often turned into all-nighters, which sometimes included hiring strippers. On one particularly rowdy occasion someone hired a midget-tossing team. Office affairs and one-nighters seemed to be the norm. All of this might have damaged morale in the long run but it appeared there was never a planned long run with Vitaminwater. The company was built to flip: grow fast at all costs and then sell. But Andy seemed most disappointed in the product itself, which he thought only had the pretense of being healthy. In fact, he told me, the staff often referred to it among themselves as “dirty water.”

  “I don’t drink the stuff anymore,” Andy admitted, “and I’m no prude when it comes to people having fun. But I’m ready for something different. I’d like to promote a product I believe in and work in a culture that’s got a little more, I guess, soul.” He said that even if Vitaminwater had not sold to Coke, he would probably be looking to leave. But now with Coke involved he definitely did not want to stay. “I graduated from Frostburg State and it took five years,” Andy said with a smile. “The buttoned-down Coke execs of the world don’t get guys like me, and the feeling is mutual.”

  “Do you think it’s possible,” I said, “to create the same fun, focused, run-through-walls culture you had at Vitaminwater but give it some soul? Have that sort of passion but with a purpose?”

  Andy smiled and thought for a moment. “I don’t see any reason why we shouldn’t give it a try,” he said, and we toasted the idea with our pints.

  “Okay,” I said, “I need to work on the details, but conceptually here’s the deal: I’ll bring you on as head of northeast sales. You hire and train a great team for New York. Get all the Big Geyser route owners on our side and once you triple our sales and hire and train your replacement, I’ll do everything I can to get you out west where you can find those higher mountains and bigger waves.”

  He answered, “I like the sound of that and so will Dana.” We shook hands and within two weeks, we had ironed out the details and Andy was on board.

  Most interviews I had over the course of Zico went this way. They were much more about open discussions, alignment of values, and recruiting people for a mission, not just hiring them for a job. In order to make sure hires would thrive in our culture, I communicated openly about our vision and plan. Equally important was that I discovered what each of my potential hires wanted out of life and how I could help them achieve those goals. What were their passions, dreams, and motivations? I wasn’t looking for answers I’d predetermined in advance nor did I expect perfect alignment with my own goals and interests. Rather, if I could honestly offer them a path to achieve their life goals, I knew they were more likely to do whatever it took for Zico to be successful.

  PASSION, OWNERSHIP, AND A SENSE OF URGENCY

  As I was beginning to build an actual team in the spring of 2008, the buzz in the business world was about how to create vibrant and healthy “organizational cultures.” “After working on strategy for twenty years, I can say this: culture will trump strategy, every time,” strategist Nilofer Merchant wrote in the Harvard Business Review. “If the strategy conflicts with how a group of people already believe, behave, or make decisions it will fail.” Forbes had named organizational culture the “hottest topic in business today.” Entrepreneur magazine said cultivating a company culture that attracts top talent was one of five best practices the top 10 percent of U.S. companies have in common.

  The culture of an organization starts with the founder but grows and changes organically with each hire. Every hire matters. The impact of a new personality coming on board is heightened for small companies who don’t have the luxury or ability to address anything in silos. Everything is interconnected and every new employee will likely have an impact on all facets of your business—including the overall culture of the workplace.

  Zappos knows that having “employee fit” is so important they offer $2,000 to trainees to leave at the end of training if they don’t feel it is the right company or position for them. In their first days and weeks, after they’ve had a chance to experience the culture, Zappos encourages them, literally pays them, to leave. Zappos knows $2,000 is a small price to pay in order to avoid keeping the wrong hire in their organization.

  The corporate world has a wonderful philosophy about hiring great talent wherever and whenever you find it, even creating roles for the right candidate or building what people call “bench strength.” I myself used this with great success at International Paper and even at the latest stages of Zico, but in the early, lean years, unless you have funding to cover two or three years of operations, this approach just isn’t feasible.

  For early stage, modestly funded companies, my advice is, hire when it hurts. When you or your team can’t possibly work more hours. When you’re stretched to your limit. When it’s painfully clear to you, your organization, your customers, partners, or others that you just need more help. That’s the time to hire.

  That being said, you should always look out for great talent, cultivating relationships and getting to know potential hires in your industry. This strategy allows for more effective just-in-time hiring so you have the bench strength on reserve to hire when it hurts but aren’t paying for anyone to sit on the sidelines. For example, I had known and worked for three years with Chris Weavers in Thailand before we brought him in to be Zico’s VP of operations. That we knew each other and he knew our organization allowed him to step in and immediately begin to add value. While you won’t be able to do this for every hire, hiring when it hurts has two added benefits: it will give your team an opportunity to stretch until that next role is filled, and it lessens the possibility that if you need to scale back, you can while avoiding layoffs.

  Hire Bottom Up

  Some entrepreneurs attempt to build out the perfect team of experienced senior executives out of the gate. There’s some strong evidence to support what Jim Collins calls getting the right people on the bus and letting them determine the direction. But I did not take this approach at Zico. After letting go of the early team I had, I started rebuilding the team carefully. I wasn’t looking for people who would look good in a boardroom or had fancy degrees from top schools, but rather street hustlers and hands-on doers. I favored young, aggressive, energetic types, willing to do whatever it took from packing out store shelves to packing boxes.

  TOMS Shoes built their company on this sort of energy. In their first year of operation in 2006, Blake Mycoskie and his team of three interns had sold ten thousand shoes out of his small apartment in Venice Beach. A few years later he would build out a senior executive team but most of them came from early hires who were doers, not managers, and they still run one of the best internship programs around.

  When it comes to more senior hires, the best are the ones who have had enough corporate experience to know what your business can look like at scale but have also been through a start-up experience to help navigate through all the challenges of smaller stages. Don’t be their first fling. Let them learn about start-ups somewhere else and bring that experience to you.

 
; Build a Superteam, Not a Team of Superstars

  For generations, the superstar performers have been thought essential to building a great organization. “People say the most important thing is building a world-class team,” Ben Horowitz wrote in his book The Hard Thing about Hard Things. “It’s such an obvious statement to the point where it’s useless. It gives you overconfidence if you’re doing it because you think that once you have great people, it’ll work. But no, it’s not that simple. They might end up killing each other if you don’t put them together the right way, if you don’t make sure people are communicating and on the same page.”

  I believe that for most businesses, having a superteam rather than a few superstars is far better. Superstars don’t come without cost. For a start-up running mean and lean, you might simply not have the cash to lure one of these players or keep them if you’re lucky enough to attract them. And in truth, they can embody the very opposite of what makes a good team member. They can be egotists, obsessed only with their own performance. They can make your workplace toxic by becoming competitive with other employees and dismissive of their effort and contribution.

  “For the last fifty years, we’ve thought that success is achieved by picking the superstars,” says serial business founder and author Margaret Heffernan in her 2015 TED Women talk. “Pick the brightest men or women and give them all the resources and all the power. But this often leads only to aggression, dysfunction, and waste.”

  There may be problems in the world that require super-geniuses to solve, but how to effectively promote, market, and sell coconut water wasn’t one of them. What I needed were not brilliant individuals but a group with collective intelligence and grit. Self-motivation, integrity, and fitting into the organization’s culture were more important than exceptional individual performance and brute intelligence. We looked for one’s ability to live the brand—to represent the mission, the company, me, and everything we stood for, whether on the job or off with friends and family.

  I also brought as many people as possible into the decision-making process for each hire. This extra step of course made the process increasingly cumbersome as the staff grew. And while the final decision was still mine, by consulting with as many people as possible, I’m convinced I headed off several bad hires when others noticed personalities or interpersonal styles were going to clash.

  Play to Strengths

  Early in my career, I embraced a management philosophy and practice called the Performance Development Road Map. As part of this process, each employee takes an in-depth personality test that shows areas of strengths, weaknesses, and opportunities to improve relative to some ideal person in that role. Then, the manager is expected to work with the employee to take on tasks, assignments, or education to strengthen the employee’s weak areas. I used this for a few years before realizing it was absolutely the wrong way to manage. I was trying to force everyone to become like some generic ideal employee. Not only will this approach not get the best results, its goal is rarely achievable.

  We should play to our own strengths no matter what size organization we work in. Within Zico I took this approach starting with myself, recognizing and playing to my strengths, and then hiring others to complement or fill in the gaps. Generally, I’m best at laying out a vision, developing strategy, planning, inspiring people to share and adopt that vision. But what I found out quickly was this skill set was almost zero help when trying to engage Big Geyser distributors. So I hired Andy, who was a lighthearted, street-smart jokester. He could engage with distributors and buyers while I worried about the thirty-thousand-foot view of the business. One of Andy’s first hires was Rory Mulcahy. Rory can talk, if you forced him to, though most people thought of him as constantly angry. This couldn’t have been further from the truth. He’s just not Mr. Big Personality like Andy, but ask him to build and execute a sales plan for New York and track and measure results? Nobody was better. We needed each one of these three very different skill sets and many more to win.

  Empowering employees is every leader’s dream. We’d all love to have a team that takes initiative and exceeds goals with little guidance. In my experience that’s a pipe dream, especially in the early stage of a company. Managers must manage. At Zico I always tried to make very clear what my expectations were and checked in constantly to ensure they were being achieved, at least at the beginning of a new employee’s tenure, or after a change of direction or someone taking a new role. This wasn’t simply command and control: I always invited feedback and suggestions but once we agreed on the objectives, I wanted to see people deliver. Then when someone proved they could deliver consistently, I would empower them to take it to another level.

  We had hired Katie Journeay to lead our expansion into Texas, beginning in Austin. After spending time in New York to get to know the team and how we built Zico there, Katie headed back to Austin to replicate the strategy. The basic plan was the same: distribution in yoga studios and natural foods stores including Whole Foods, and stage demos and events around yoga and endurance sports events, such as running, cycling, and triathlons. For about eighteen months, Katie followed that to a T and her results were extraordinary. She proved that our strategy could work outside of New York. At some point Katie came to me suggesting a new influencer group. She wanted us to sponsor a local roller derby team. I wasn’t buying it.

  “Roller derby? Are you serious?” I asked.

  “Yeah,” she said. “It’s hot. Where have you been?”

  “I don’t know, raising children, starting a company,” I responded.

  “Trust me,” she went on. “It’s like coconut water, something old coming back with new vigor for a new generation.”

  I grilled her at length. Had she fully executed our strategy? How many yoga events and triathlons were there in Austin? How many runs? How many had we been involved in? She rattled off all the stats.

  “Mark, there’s not a yogi, runner, cyclist, or triathlete within one hundred miles of Austin that doesn’t know about Zico. We hit fifteen events in the last sixty days alone. We’ll keep hitting them but it’s time to expand our audience.” She then broke down the demographic of the roller derby enthusiasts and their growing fan base. It was an interesting subculture of trendsetters in Austin.

  I agreed. Katie had delivered all that I asked, so why not trust she knows what targets to expand into? I don’t think roller derby made the difference in our success, but I know that Katie did. And allowing her to experiment in her market kept her more engaged and thinking instead of simply executing. Empowerment is risky but if you have the right team, the right guardrails, the right sense of ownership, there is no more powerful way to engage your team. And the results of a fully engaged team have no limits.

  When You Make Hiring Mistakes, Undo Them Quickly

  You will make mistakes with hires. I made a few bad ones at Zico, usually when I didn’t fully engage my team in the hiring process. One senior executive, for example, came highly recommended, was well qualified on paper, and interviewed great. I hired him quickly to fill an important role. Over the first few weeks I was personally engaged much less than I should have been as I was trying to resolve supply chain issues abroad. After about three weeks I got a call from one of my employees who said, “Mark, we need to talk urgently about Max” (not his real name). I was about to get on a plane and said, “I literally have one minute, get to the point.” He paused and said, “Let me put it this way. As a team, we have calls before our scheduled calls with him so we can get each other aligned and be prepared to stand up to him and then we have calls afterward to debrief. It’s killing us.”

  I dug deeper and it appeared this person had somehow managed to alienate much of the company, especially the field sales and marketing organizations, in just a few weeks. I talked to him, laid out the facts. He knew it was true and we both recognized that Zico had a very unique and almost fanatically protective and passionate culture, and he was
never going to recover. I took responsibility and we parted ways amicably. With one wrong hire, I could have destroyed everything we had built. Fortunately, our team felt comfortable to come to me and when it was obvious this hire needed to go, the company basically purged him—he didn’t belong in the Zico culture. That’s not to say that he wouldn’t perform well in a different organization. Fit and alignment is key to hiring the right team.

  Why Women Reach Higher

  When I first immersed myself in the beverage industry, I was stunned to realize how few women were in leadership roles of entrepreneurial companies. The Coca-Cola Company and PepsiCo had numerous women in senior roles, all the way to the top spot at PepsiCo. But among start-ups, I met only a few women in major roles and only one that I recall running the show. The common thinking among some in the industry was that the start-up beverage world was so cutthroat and competitive that only ruthless, self-absorbed jerks stood a chance. That myth selects for men. (Name all the ruthless, self-absorbed jerks you’ve met and see how many women end up on your list.) For those who don’t believe that myth and build their businesses on entirely different values, you have a huge competitive advantage to be gained in the wellspring of talent that is not being considered.

  When I hired women for senior roles in finance, operations, sales, and marketing, I heard whispers from some in the industry that they weren’t going to be tough enough. Those spreading rumors clearly didn’t know these women. Their form of toughness didn’t come from mirroring the testosterone-fueled behavior of men but from a brutal assessment of the facts and a hard-nosed and honest take on what needed to happen for the best of the business, and they kept me in line on more than one occasion.