ALL companies, large and small, are messy.
Sep 18, 2022 | Important PSAs
ALL companies, large and small, are messy. Like, REALLY messy. And we all learn WAY more from sharing the mess than the success. Yet so few do. Here’s our TOP 10 mistakes at Bolt over the last eight years, and our learnings from each one:
Before we dive in, what a privilege. Most don’t make it here! I get to sit down and write today with so many issues in the rearview mirror. And it’s all because of the team.
Bolt is full of magicians who consistently transform our biggest challenges into our biggest opportunities. I make a couple smart decisions here and there, But they undoubtedly drive the train. Ok, now let’s dive in ↓
Mistake #1: Trying to boil the ocean In the beginning, we didn’t just want to run Checkout and Accounts. We also wanted to run Payments as the exclusive processor. Our reason: own the stack end-to-end, provide a holistic experience.
Sounds good right? The reality didn’t match up to our ideals. Merchants were deeply integrated with their processors, and put up enormous resistance to switching to us. We kept making up reasons why we wanted to stick to this principle.
This idealism blocked us from landing SO many deals. “If we don’t own the payments, we can’t provide the best experience.” But ultimately customers didn’t care about OUR reasons. They cared about their own.
This dogmatic approach cost us at least 2yrs of progress. Learning: Focus on what you do best and ignore the rest.
Mistake #2: Confusing pricing Bolt’s Checkout OS is a software suite. It also drives conversion. We used to price a flat rate on every transaction, saying one rate would “cover all the value of Bolt.”
The problem: businesses couldn’t draw a clear ROI It was convoluted, and no one wanted another variable fee that they couldn’t justify! Even though our 0.4%-0.8% per transaction range offered high value, it wasn’t easy enough to measure.
So, we switched our pricing. We started charging a 1% network fee (soon 2%) ONLY for one click transactions from our existing shopper network. This is most squarely when we add value. All other transactions: no network fee.
Network-powered one click transactions have 50% higher conversion rates and 66% higher repurchase rates. The ROI is clear and measurable. Pricing went from our biggest sales challenge to our biggest sales weapon. Learning: If you can, charge on ROI, and weaponize your pricing.
Mistake #3: Scaling an unscalable business Bolt thrived with SMBs from the start. We signed 100s of merchants each year. Our growth numbers were awesome.
The problem: it was a CAC/LTV death march. Our sales and implementation costs at the SMB level was so high (CAC). Integrations were custom, just like in Enterprise, but with a fraction of the revenue (LTV). This made growth unsustainable.
Instead of admitting this, we pushed the gas pedal. Inevitably, layoffs and a major reset followed. Teammates who believed in us and dropped everything to join our mission, gone. Brutal. Learning: Make sure the thing scales before you scale.
Mistake #4: Signed to live dropoff Traditional SAAS companies sell standardized contracts. Fixed fees, predictable revenue. Get the contract signed, and the revenue is as good as gold. That said, transactional businesses are WAY trickier.
There are several things that can go wrong post-sale: Most notably: 1/ An implementation doesn’t go well 2/ The customer underperforms relative to what they projected In either case, your live numbers don’t materialize.
The fix: over-investing in implementations. We made it a top company priority to “never have another failed launch.” This took immense cross functional work and is still something we’re working on to this day.
We also introduced a deal desk, which sits independently from sales and verifies data. They’re pros at projecting revenue conservatively and accurately. Learning: The hard work begins AFTER you get to “yes.”
Mistake #5: Hiring friends It is compelling to hire friends into your company. It is also way too common. The inevitable problem: favoritism. Friends can often expect to be treated above merit.
I had to part ways with several friends. These were some of the toughest moments of my life. The reality: it wasn’t their fault, it was mine. Learning: Be upfront about expectations and hold everyone to the same standards.
Mistake #6: Setting crude cultural values At early Bolt, hard work and hustle culture was everything. And, of course it was necessary. But, we didn’t balance and our culture paid the price. Learning: Create a Conscious Culture (see below).
Mistake #7: Compromising on investors In short, we took money from some investors for capital, and not for alignment. Managing them took invaluable time away from the business. Learning: Always vet alignment before taking a check.
Mistake #8: Having no clear north star When Bolt reached ~15 people, things started to break. Some thought we should go X direction, others Y. Some thought we should be hustling harder, others wanted more balance.
Who’s fault was it? Mine… without a doubt. I didn’t drive a North Star for our product or our culture. These issues festered to the point where the culture became toxic. Learning: the CEO is ultimately responsible for everything.
We finally had a “company reset” where we made decisions on direction and values. These decisions weren’t all too popular. Teammates I admired and worked so hard to recruit walked out the door. 15 people shrunk to 7. Learning: Sometimes you just have to click “reset”.
Mistake #9: Not admitting mistakes to your team As a founder, you want to say that everything is going great all the time. The problem: it’s not true. This breeds distrust and demotivates the team. Learning: Talk about challenges just as much as you talk about opportunity.
Mistake #10: Retaining leaders who… lack leadership Leadership is a skill on its own. For your leaders, it’s the most important. For many years, we were hiring leaders for their intelligence. But many of them couldn’t foster unity in tough times.
The longer we left them in seats, the more their teams would go sideways. At several points, I had to return back to running teams MYSELF. I was CEO while also VP of X, with 20+ direct reports. When you do this enough times, you vow “never again” Learning: hire real leaders
~~ Closing ~~ This list could go on and on. Hiring wrong, firing wrong, planning wrong. What I’m proudest of: we were committed to “not making the same mistake twice.” We learned from our mistakes.
And we took this commitment to learning seriously. Every couple weeks, we sit down and document all that went good, bad, and sideways. This wasn’t just for ourselves, it was for everyone. We pioneered Conscious Culture to bridge execution with humanity.
This was a team-wide effort, and I couldn’t be prouder of what we’ve accomplished. It serves as a new model for company building that over 300 companies have adopted. Our playbook is fully open source on conscious.org.