As the final piece to a three-part exclusive, Co-Founder and Co-CEO Dave Gilboa reveals how Warby Parker attracts and retains top Millennial talent.
Forefront Publisher George Bozonelos had the opportunity to interview Dave Gilboa, Co-Founder and Co-CEO of Warby Parker, at the IRCE conference in June (read our post about the conference here). The two covered a range of topics, and we wanted to share as much as we could with you, our readers. Because the dialogue touched on so many different points of business success, we thought it best to present you the information in a series, the third and final part of which is below.
Part 1: How to Sell a Physical Product in a Virtual World
In part one of a three-part exclusive, Warby Parker Co-Founder and Co-CEO Dave Gilboa shares his tips for building an online brand using offline tactics.
Part 2: Are Two CEOs Better Than One?
Conventional wisdom says friends make terrible business partners. In part two, Gilboa shares how it worked in Warby Parker’s favor.
Part 3: What Millennial Workers Want
Gilboa reveals how Warby Parker attracts and retains top Millennial talent.
Note: Part 2 of the series ended with Gilboa explaining the dynamic between him and his Co-CEO. Picking up where we left off, Part 3 of the interview introduces the company culture and the long-term vision of Warby Parker.
George Bozonelos: It sounds like you guys gave a lot of thought not only to today, but to tomorrow. Are there times when that over-thinking is sort of a drawback? Where sometimes you just say, “Look, let’s stop thinking about this real quick and take action.”?
David Gilboa: I don’t think you can over-invest in culture and team dynamics. We’ve tried to incorporate continuous feedback throughout the entire organization. We do quarterly 360-degree reviews with everyone in the company. Every month, every manager and direct report has a monthly informal feedback session. And on a weekly basis, we ask every employee to rate their happiness on a scale from one to ten and give their biggest reason for that happiness score.
All that communication and feedback just takes a lot of time. When we are about to go into quarterly review sessions, it takes people several days to fill up their reviews. It’s a big investment—especially for a company that’s growing so quickly and has a million things going on—to say, “We’re going to ask you to stop working on these really critical functions for the business and just reflect on how other direct reports are doing, how you’re doing.”
This is a big investment that we’re making, but we’ve done studies on millennials and how they function in the workplace and found out there are two big reasons why they leave an organization. The first one is a bad relationship with their boss. They feel like he or she doesn’t understand or doesn’t give them the opportunities that they want. The second one is that they stop learning or growing. We want to make sure neither of these happen in our company, so we have direct feedback channels to allow people to communicate so there should never be any surprises that someone is unhappy or someone is not doing a good job. We try to keep things very transparent.
We did an internal survey and asked people to rank order the reasons why they joined Warby Parker and rank order the reasons why they have stayed in the organization. In both cases, compensation and benefits were dead last. Numbers one and two were culture and opportunity to learn and grow.
Bozonelos: Isn’t that fascinating? I think you’re spot on with the millennials. It’s a huge monumental shift as far as the attitude. Now that everyone’s mobile, they want to be where they want to work. It’s more than just money. Money is assumed. It’s not the “here’s-a-paycheck-now-be-my-servant” type of attitude.
This really leads into my next question. You guys are past the startup phase—you said you have 250 employees now—and you have been building structure and it sounds like you have a lot visions to take this across the country in a brick-and-mortar type of environment, which is a huge shift. Not every employee is in the same location; they are spread out. How are you trying to manage that growth carefully to stay true to your original plans and principles?
Gilboa: I like to think of it as us entering our “teenage years,” where we’re not a scrappy startup working out of an apartment anymore but we’re also not a big, bureaucratic company. We’re realizing that things that worked when we were 20 people will just not work anymore . We need real processes, we need to transmit information across multiple departments, we need people to be coordinated in what they were working on and how employees prioritize their time. We’re building layers of management and bringing executives that have experience, but marrying that with some of our early employees and dynamic individuals who have moved up in the organization quickly.
It is a challenge for me—as someone who was involved in every piece of building the company. The first customer service calls were directed to my cell phone. I was staying up all night answering customer service calls and emails, packing boxes, setting up our accounting system and all that stuff. Letting go of key functions that I know I can do well is a pretty scary thing, but I think it places an even a bigger emphasis on developing people in the organization and hiring the right people.
To this day, either Neil or I will interview every single person before we hire them. We’re extremely dedicated to having a rigorous interview process—both testing for competency for key roles but also cultural fit—to make sure that they can handle a chaotic fast-growing environment.
We’re constantly trying to find a happy medium. We now have a dedicated couple of individuals on the team just for process improvement—to figure out what’s not working or if there’s a process or department that’s having more issues than another. Like a SWAT team to map out how everything works today and figure out how we can make improvement.
Bozonelos: It’s like an internal consulting firm?
Bozonelos: You’re using your Wharton roots instead of going to a consulting firm. You were a consultant, right?
Gilboa: Yes, my first job out of college was at Bain & Co.
Bozonelos: So that’s in your blood to hammer all that out?
Gilboa: Yes. We’ve hired a bunch of folks from Bain, BCG and McKinsey.
Bozonelos: That’s interesting. You don’t always think about people like that going to a startup and you guys attract those folks early on. You’re not startup anymore, but you’re still not a global, Fortune 500 organization yet. How are you attracting that talent? You alluded to your research as far as providing some sort of higher purpose, growth and development. It sounds like it’s more than money—money is only part of it. Am I on the right track?
Gilboa: Yes, 100%. I think people want to have an impact and they look at our organization having grown so quickly, and believe that there are going to be opportunities to learn and grow and develop and take on more and more responsibility.
We’ve also found that our social mission does attract a lot of talented and driven people. We are a B-corporation. We’ve been 100% carbon neutral since the beginning, and for every pair of glasses we sell, we distribute a pair to someone in need. We have a number of nonprofit partners and are constantly thinking about how we can use our organization as a vehicle to have a positive impact. People want to work for company that is doing good and having a positive impact in the world, and we’ve found that it’s been a great mechanism to attract and retain really talented people.
We’ve also found that if we can attract really smart, motivated people that they tend to know other smart, motivated people. By far, the best source of new hires is internal referrals. We’ve also hired people that are just passionate about our brand. Some are our customers first but later say, “Wow! This is a great company, this is a great brand that I want to be associated with. Let me see if they have any job openings.”
For example, one of our software developers was first a customer. He walked into our store, was already wearing our glasses and bought another pair of glasses. As we were checking him out, he said, “I love your company. Do you guys have any openings that I might be qualified for?” We didn’t have anything posted on the website, but we put him in touch with our VP of Technology. He started a few days later, and then he recruited his old boss who is now our Chief Architect.
We look for people who are passionate. We think of every person as a brand ambassador.
Bozonelos: Many people read about what a company can do attract talent and how they can change their company culture. You guys have done that from the start and you’ve really been very methodical and careful about maintaining mindset. In reality, it’s not just because ethically it’s a good thing to do, but it sounds like in the long term it’s an incredibly profitable thing to do. The whole is greater than the sum of the parts, yes?
Gilboa: Absolutely. We tried to be really thoughtful about the core pillars of our organization and brand, establishing our social mission and dedication to culture as key priorities. We think of both of those elements as long-term investments that will ultimately make for a more sustainable, profitable business.
Bozonelos: I’m interested to talk to you again in a year or two and say, “OK, now you have 500 or 1,000, how are you facing that?” Very few organizations have been able to avoid compromising what they stand for at any point in their growth. Have there been instances where someone says, “Hey, go public.” Or, “Cut the charity stuff out. You make this a very profitable company. Take it to a different path.” How have you resisted that?
Gilboa: We get that question a lot, “Have you had trouble raising money or have investors questioned how much you’re investing either in developing your employees or how much you’re spending on charitable causes?” We really haven’t had any issues with either.
We found investors that understand that our social mission and culture are a big part of our brand and we’re investing in all these things. We think it’s a good business as well. It will make us more profitable. It helps us create closer connections with our customers, and it helps us attract and retain the best talent.
We believe that the best emerging companies and brands need to incorporate these elements into how they build their organization. Consumers want to buy products from brands that they believe in and people want to increasingly work for companies that are having an impact.
For us, we never thought about how we could be X percent more profitable if we cut all our ties with charity and one of the reasons why we wanted to become a B-corporation was to institutionalize that so that if investors had a conflict, we actually have a legal obligation to think about all stakeholders that we touch.
Bozonelos: That’s great. Just wrapping up, what’s your favorite part about what you’re doing right now as a leader, not from a company standpoint but from a personal standpoint? What are you looking forward to down the road as your company grows? Let’s say you tack on another 250 employees, how do you see your role evolving on that?
Gilboa: It’s super exciting to take an idea and see it come to life. The first time I saw someone walking down the street our wearing glasses, it was an exhilarating moment, that this was actually real.
At this point, I get most excited about building our organization and investing in our team; how we’re developing in the next layers of managers and leaders in the company and thinking about how we build a scalable organization so that it continues to be a highly-productive, fun work environment, one where 500 people, 1,000 people, whatever that might be. I never want to have the feeling and don’t want anyone in our company ever to have the feeling of waking up and dreading going into the office—to feel like they’re just clocking in, clocking out and getting a paycheck. We want to continue to put all the pieces in place so that it continuous to be a really dynamic culture as we grow.
Bozonelos: Yes, it’s like a never-ending puzzle, but at the same time it sounds like you’re having fun. I give you a pat on the back for sticking to what you believe in and what you want to do. I’m sure it takes lots of effort, but that’s why you get people saying, “I believe in you and your company. How can I work for you?” That’s probably the biggest compliment you can get. ♦
Dave Gilboa is the co-CEO of Warby Parker. Read his bio here.
George is a graduate of the Loyola University Quinlan School of Business and resides in the Lakeview neighborhood of Chicago. When he’s not working on Forefront, he spends his time with his family, long bike rides on Chicago’s beautiful lakefront and sampling some of fine craft beers from the breweries around city. Read more about George