Shellye Archambeau is one of Silicon Valley’s first female African American CEOs. Formerly an executive at IBM and CMO at two public companies, Shellye was recruited to be the CEO of a then-struggling Silicon Valley startup, which is now MetricStream, a recognized global leader in governance, risk, and compliance software solutions.
Shellye talks about her journey to become one of Silicon Valley’s first female African American CEOs and recounts how she transformed MetricStream from being a Silicon Valley ‘problem child’ to a sustainable multi-million dollar business. She talks about how founders can balance short-term interests and long-term desire to build sustainable companies, how they can bring in more diversity and inclusivity to their businesses, and the dangers of falling in love with your product.
Q. Tell us about your journey with MetricStream and what were some of the challenges there?
Shellye: First and foremost, their value proposition was broken, because they hadn’t sold anything to a new customer in months. Two, they were losing money, badly. And we had to stem the bleeding. Three, there was a lot of employee churn. I needed to find a value proposition, figure out how to finance it, and I needed to get the right team to then deliver on it.
The first thing of all those three was to stem the bleeding. Cut costs and make some reductions so that we have a little bit more runway. The second was to find a value proposition. The way I did that was I went out and talked to some of the smartest people that I knew and I asked them what are the big challenges that businesses are facing, right now? What are the trends? What are the problems? I wanted to hear problems because the best way to create a value proposition is to find a big hairy problem and solve it better than anyone else. But it needed to be a problem. That was a painful problem.
What I found was that companies were really struggling with all of the compliance requirements that they had. So we took the technology that Zaplet had built and repurposed it for compliance and risk management. That meant that I needed a different company because I was now going to sell applications and Zaplet had been selling to IT departments. So I needed different developers, different salespeople. And I didn’t have any money. So I found another company with Vinod Khosla’s help. Vinod Khosla was the partner. We put the two together. We crafted the new MetricStream and went out and raised money on a new value proposition. And that was the key to the beginning of the rise of the company.
Q. Tell us a little bit about why companies and startups need to be more focused on value and scalability, rather than just about hyper-growth.
Shellye: It’s interesting because people think that the best companies are the ones that are growing the fastest. What I would say is that’s not always the truth, not over the long term.
What you really want to build is a sustainable company. One that as it grows, and as it scales, will continue to add value, and will continue to meet the needs of the marketplace. If all you’re focused on is hyper-growth, then you may not be investing in some of the foundational elements that are required to support all that growth. And eventually, you’re going to have challenges.
The relationships that you are creating with customers are precious. And if all you’re focused on is getting the next customer, and not making sure that your existing customers are well cared for, well satisfied, and getting a lot of value, you’re going to run into challenges.
Focus on sustainable growth. That doesn’t mean it’s slow growth, you can absolutely build a company that’s growing quickly, but sustainable, so that you don’t create a situation in which you have basically outgrown all of your infrastructures. Because companies have that and they end up having to step back, fix some things and then go forward.
Q. Tell us about your book Unapologetically Ambitious, why did you decide to write it?
Shellye: I wrote the book so that I could share lessons strategies, and approaches that I’ve learned. And that I’ve employed in my career path and life path so that others too could achieve their aspirations.
I didn’t see anything out on the market that actually talked about it, candidly. You know, you hear a lot of people say, oh, yes, I did this, and this and this, and boom, right? I’m now CEO. I talk about the good, the bad, and the ugly. I talk about the hardships and the pain. I talk about needing a psychologist, I talk about all that stuff, because this stuff is hard. But just because it’s hard, doesn’t mean you can’t do it.
I share how to help yourself, how to get help, how to get support. How to overcome everything from imposter syndrome, to bad bosses, to hurdles that are put in your path. I want people to know that the challenges they’re facing, they can get over them.
And I know especially as women and even people of color a lot of times when we’re told we’re ambitious, it’s actually not a compliment. And that’s ridiculous. Absolutely ridiculous. We all have a right to be ambitious. And so Unapologetically Ambitious is everybody has a right to be ambitious and you shouldn’t have to apologize for it.
Q. How can startups make sure that they are creating an inclusive culture?
Shellye: It’s all through the company that we need to be thinking about diversity. And frankly, startups are in the best position. The reason they’re in the best position is you can design in diversity from the start.
As you’re building your team, if you look at it through the lens of diversity, making sure that as you’re recruiting people and bringing in key roles at the senior levels, as well as the lower levels, it’s easier to do that when you have every role to fill. Because then frankly, you have a much broader set of people that you can target because you need everything, you need marketing, you need sales, you need legal, you need engineering, you need all of it. From there, it goes all the way to the board.
Take advantage of the fact that you are just building the company and do it with a broader lens to diversity. Because study, after study has shown that diversity adds more value to companies. They perform better, and they deliver better shareholder value.
Q. How can leaders create an open environment for employees?
Shellye: I like to say, the higher you rise in an organization, the harder you need to listen and the softer you need to speak. The reason I say that is as you rise up, people start getting afraid to tell you what’s really true. They don’t want to ruffle the boss’s feathers.
When you’re at lower levels, they’ll tell you but as you rise up they don’t tell you directly. They might hint at it and you have to listen harder to make sure that you know what’s really going on.
You also have to spend time walking the halls, making sure that you’re checking in with people at all levels. That you’re doing some roundtables that you have ways in which you hear for yourself so that everything that you hear is not filtered through your executive team.
Q. Should founders concentrate on building their personal brand?
Shellye: Honestly, as a founder, your brand goes, neck and neck with your company. Think about the great founders like Larry Ellison, their own brand and their company are intertwined. And it should be because if you found it, and you built it, and you’ve been with it over time, your values should be showing up in the company.
The company values should reflect your values. I wouldn’t worry about building a personal brand. Focus all your energy on building the brand in the company that reflects your values because at the end of the day, whether or not that company succeeds or doesn’t, will indeed be a reflection of you.
Q. What’s your biggest piece of advice for funders to build a sustainable startup?
Shellye: Don’t fall in love with your product. When you fall in love with your product, it becomes hard to hear when people tell you, ‘oh, there’s actually a problem over here or this isn’t working’
Don’t fall in love with the product. Fall in love with your target market. Fall in love with the problem that you are trying to solve for your target market, because when you fall in love with the target market, then you’re going to be focused on every need that they have. How do you make it better or easier? How do you ensure that even the things they don’t realize they need yet that you’ve already thought about it and provided it?
It’s the mistake I see startups do all the time. Because you can always defend your product but when you do that, you’re not meeting all the needs of the market.