Lessons from Louis Tetu, CEO at Coveo
Louis Tetu is a Quebec City entrepreneur and is currently the Chairman and CEO of Coveo an enterprise search company. Prior to Coveo, Louis co-founded Taleo Corporation, the leading provider of software for talent and human capital management, acquired by Oracle for $1.9B in February 2012. 1. "When you start a company you are physically responsible for both setting and executing the strategy. So I spent a lot of time in the field…talking to large corporations, understanding their needs, forming strategic partnerships and evolving the software and services. I spent a lot of time in the field with various industry pundits, trying to carve out a marketing strategy."
"Get the heck out of the building!" Steve Blank would say.
2. "One of the key mistakes you want to avoid is to build technology at a vacuum. One of the strategies that we consistently try to deploy is bring our R&D to the client very early on, oftentimes, even before the product is built. Truly, align with what clients need. We always work with that notion of the anchor tenant. Many products can be a technical success but that’s not quite what customers want for various reasons."
That’s what they did by building Taleo around HP. By building your product closely with a customer you are able to get more customer feedback and iterate on it to deliver superior value to your next customer.
3. "I think the mistake that many entrepreneurs make is they have a good technology or they have something that is technically differentiated in one way or another but they look at development and customers as a waterfall. The idea is if you want to show adoption of a technology, then why not start with the customer. Inexperienced entrepreneurs will say, "We build business around technology." Experienced ones would say, "You build businesses without people and very closely, right around customers."
It’s easier to raise money, once you show that you have some customers adoption.
4. "In a small, entrepreneurial company, you as an executive can watch and follow every single detail. Eventually, you need to make the transition to a company that relies more on processes…document those processes, and institutionalize business processes that let the company become more scalable."
Hyper Growth is messy and you need good processes to scale effectively an organization and keep a high level of quality. Ben Horowitz gives some good advices here on How to develop good processes.
5. "As it relates to winning new deals, I think we are very good at picking the battles we want to engage in. We run our company with the fundamental principle that everything is thoroughly analyzed and strategic. And of course, we strive to execute flawlessly once we’ve decided to engage. Sometimes we win just because our competitors execute poorly. But the key is the analysis on the front end. What is the game we should be in? Why do we know we can win that battle? I think that’s been a big part of it — thinking through our options before charging in to the battle."
Execution is key and then Louis talks about their process to execute flawlessly by describing Who they are, What they stand for, and How they do business, to their customers.
6. "I think that’s a mistake that many entrepreneurs make. They don’t put enough investments early on when they have a winning business model because presumably, they don’t want to dilute themselves too much."
This is similar to Marc Andreessen advice on how much money you should raise after Product/Market fit. Enough money to fully exploit the opportunity in front of it and extra money to use as insurance.
7. "I don’t believe things happen accidentally. When you start getting up into larger numbers, there is no such thing as consistent luck. There is no such thing as consistent bad luck, or consistent good luck. I think success is a very predictable event. It’s a matter of very closely and tightly managed planning and execution in everything you do. And if luck happens, luck happens. But, you know, the law of great numbers says good luck happens just as much as bad luck, so it’s kind of irrelevant to talk about."
You don’t want your success to rely on luck, if so, you’re probably screwed. If you want to learn more about Skills vs Luck, Michael Mauboussin is the expert on the subject. I suggest this very good 25iq post as an introduction.
8. "Coming from Taleo, I understand the math of turnover probably more than most. Stability in R&D is extremely important because that’s your IP. At Coveo, of the core team that moved over in 2005 from Copernic, 5% churned and 95% is still there. That’s critical because the aggregated knowledge is kept intact. That’s really important."
Building a high caliber company outside of Silicon Valley is absolutely doable. There’s also some advantages like less competition to hire great people.
9. "In the day-to-day operations, we use virtual communication, but I am a firm believer of in-person meetings and having people interact. We go and meet customers. I travel literally all the time. I spend three to four days a week on the road visiting clients and our people. My job doesn’t happen in my office. I really believe in in-person interactions. Plane tickets are cheap from that perspective. That’s also one of my key guidance towards the entrepreneurs that I coach. It’s towards the idea that people buy from people at the end of the day."
Business relationships matter. An important point is to have information channel that gives you insight before everyone else. An other key point is to Give before you get or to be the first to provide value. You’re then able to leverage both to create more value on your side. You can’t do that if you don’t meet in-person.
10. "Ninety-five per cent of the population is too constrained, to be a ‘free-thinker’ is the most valuable attribute for our employees."