March 28, 2024

Corner Office: LivePerson’s Chief, on Removing Organizational Walls

Q. What were some early leadership lessons for you?

A. I got out of college in 1990. We were in the middle of a recession, and I got a job at a trading company. I was there for six months, and they fired me because they needed to lay people off. I remember they took me to lunch, and they asked me what I took away from the experience. And I said, “I’ll never work for anybody again.”

And then I started my first company. I put $50,000 on credit cards, and I had the idea of bringing interactive kiosks with touch screens to college campuses and selling advertising on them. It was working, but it was a struggle. And the Internet spread quickly, and I had to shut the company down. I lost everything. It was a humbling experience, and I ended up coming to New York. I rented about 400 or 500 square feet from a guy who was making T-shirts down in TriBeCa.

This was the point where everything changed. I was 27, I failed and I was pretty down, and I went to see a therapist named Frank Maurio. He didn’t charge me because he knew I didn’t have money. For two years he worked with me and changed how I perceive the world. And when I took LivePerson public on April 7, 2000, I gave him some shares in the company and thanked him.

Q. What lessons did he teach you?

A. There were a couple of things. One is that, usually, nothing is as bad as it seems. As entrepreneurs, we tend to react to a situation. So if you panic and you bring that emotion, it’ll wear you down. So it was really important to just be centered during the day. The second thing is surrounding yourself with the right people, but I think he changed my understanding of who the right people are. Entrepreneurs in particular want high control. It can be wonderful, and it can be disastrous. He taught me that you don’t want to have people you can control, but you can still control your future and have people who can help you build the company.

The other one is that you have to evolve and change at all times. We have a tendency to be lazy, especially when things are good. So the concept was, you should be in a constant state of evolution as a person, because if you stop, you will end up having to leave, or what entrepreneurs tend to do is they basically self-destruct and hurt the company. They start making bad deals. They hire bad people.

Q. What are lessons you’ve learned from running LivePerson?

A. The last two years have been a real change. We have approximately $160 million in revenue, but when we hit about $100 million in revenue and 500 employees, I could see things evolving in the company that could really hurt us in the long term. We started to become bureaucratic a little bit. You start to add middle management layers. So this dead-weight layer comes in, and their job is just to make sure everyone does their stuff. And then what happens is you become very siloed in many ways, and the managers want control. Then you get infighting, and people are more focused on getting offices and titles, because they ask, “It’s very hierarchical here, so how do I get up the chain?”

Q. Was there a moment when you really felt that culture taking hold?

A. I remember one moment. We had the cubicles in the middle and offices on the outside, and I walked past a small office and noticed two people shoved inside. And I asked them: “Why are you guys shoving yourselves in an office? You were just in cubes out here.” And they said, “Well, we’re directors now, and directors get offices.”

I’d never believed in culture and core values up to that point. But I really became very reflective because I wasn’t so happy with what was happening with the company. I’d seen things that had made me realize we were becoming very traditional. I started to spend more time with a couple other companies, and it made me realize, as a founder, that if I left the company, it could be a totally different place because of the next set of leaders. And that’s what kills companies. So I thought that values were the way to have a long-term sustainable company. I finally said, “It’s time to start making the change in the company.” I came in one day and asked all the leaders to move out of their offices, and that was the start of a painful process of change.

Article source: http://www.nytimes.com/2013/02/10/business/livepersons-chief-on-removing-organizational-walls.html?partner=rss&emc=rss

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