When I first met Carlin Wiegner and Ross Fubini, the cofounders of CubeTree, it was late 2007. My good friend and former Trinity EIR, Nick Mehta, introduced Carlin and Ross to me as fellow Symantec executives who were starting to brainstorm about a new company.  Over the past two and a half years since that first meeting, I have watched these two exceptional leaders build a world class team of ~20 outstanding individuals and evolve CubeTree into the leading SaaS startup in the burgeoning social software for business category.  Before I jump to the Happy 100th Release aspect of this post, some CubeTree history may be helpful, so here goes:

To begin with, while “Facebook for Business” is considered more commonplace today as a trend within the enterprise thanks in part to visionaries like Marc Benioff talking about the Facebook Imperative, it was quite a nascent customer market back in late 2007.  This was true despite the prescient category call by my former professor and now Enterprise 2.0 super star, Andrew McAfee, who highlighted the underlying trends in March 2006.   Carlin and Ross’ conviction in late 2007 stemmed from their disenchantment with the collaboration products they used within their former employer, Symantec.  They realized that there was a growing gap of unmet user needs in the market of intranet portals and knowledge management solutions.  My own market diligence led me to also have strong conviction that there was going to be significant customer demand for a solution like CubeTree.  One tell tale sign I kept hearing about was the repeated yet unsuccessful attempt by IT departments to control and lock down internal employee usage of Facebook.  Finally, my Trinity partner, Gus Tai, brought his uncanny insight into consumer web trends and end user behaviors (hone via investments like PhotoBucket) to the conversation. 

This joint market and product conviction among the four of us led Gus and me to fund Carlin and Ross in Spring 2008 to go forth and disrupt.  It also helped 18 months later to attract the highly connected Bruce Cleveland at InterWest Partners to lead the Series B.  And it certainly resonated with collaboration luminary and founder of Lotus, Mitch Kapor, such that he got involved as an angel investor and advisor.

Fast forward, two years and 100 product releases later, CubeTree is executing on their social software vision extremely well.  Today, it is a world class, multi tenant SaaS collaboration suite that incorporates an activity feed, employee profiles, wikis and third party integrations. 

But, hold on a minute…  “100 releases”?  Over just two years?  Consumer web startups are notorious for fast iteration, especially when following the intersection of product development philosophies of agile software development with customer development as summarized nicely here.  But a multi tenant, enterprise grade SaaS app? 

Here is a perfect example of the axiom “startups are 99% perspiration, 1% inspiration”.  Carlin, Ross and the entire CubeTree team have executed admirably well and have literally shipped a new release of their product once a week for the past two years straight.  I thought this milestone is worth highlighting and Carlin and the CubeTree head of engineering, Justin Rowe, talk in depth in a recent CubeTree blog post found here about the opportunities that this nimble, high speed development cycle has created for the company to partner with, and ultimately delight, customers.  To me, this underscores the power of the business fundamental of active listening to customers coupled with a lean, nimble and high performing software engineering team and process.  It also underscores the early stage venture capital fundamental of investing in great entrepreneurs who know how to execute like surgeons against a compelling and exciting market vision. 

Carlin and Justin’s interview on their lessons learned is well worth a read and I congratulate them and the entire CubeTree team on shipping their 100th product release last week.  Well done!

What is the difference between “leadership” and “management”? 

This past Wednesday night, over 50 CEOs and Founders from across the Trinity Ventures portfolio gathered together for our annual CEO and Founder dinner to debate this question.  Imbued by energized networking and copious cocktails, we explored and debated the fundamentals of leadership and management in difficult times, since, especially in this economic environment, world class leadership and management skills are crucial to the success and growth of a business.  While our portfolio company leaders represent an extremely seasoned and high caliber group of executives, all enjoyed revisiting and reflecting on these fundamental values.   I thought it worth summarizing the key examples and takeaways as I found it a good fit with the spirit of IronGiving.

The discussion topic, Leadership in Difficult Times, was facilitated and led by our guest speaker, Professor Charles O’Reilly from the Stanford Business School.  Professor O’Reilly’s discussion included aggressive Socratic style cold calling of the audience (after all, he is a business school professor) and spirited debate.  We examined three real world scenarios brought to life via video clip interviews with three high tech CEOs: Bill Campbell, former CEO of Intuit, current Chairman who covered a situation where his authority as a CEO was openly challenged, Kent Thiry, CEO of DaVita who covered an instance where a high performer on his team clashed with the existing company culture  (be sure to click on his name to watch the YouTube video and get a flavor for his colorful leadership style) and Brian NeSmith, CEO of Blue Coat Systems who covered a scenario where an engineering rock star was disrupting productivity.

The most succinct answer to the above question came from Brett Wilson, CEO and cofounder of TubeMogul, an online video analytics and advertising startup Trinity invested in earlier this year.  Brett stated emphatically, “Leadership is about inspiring the team to win the game, and management is about the x’s and o’s of how to win”.  I couldn’t agree more and as a former crew team guy, I thought the image above captured this mixture well - inspired team members can pull hard on the oar but they also need to do so in unison and with rhythm. 

I won’t go into the details of each scenario but the high level takeaways include:

-          CEOs need to embody BOTH leadership and management to be effective.  This was the simplest yet biggest lesson.  The best CEOs do both.  It isn’t easy, but the rewards and returns are even greater for those who can. 

-          CEOs are signal generators.  What they do and say ripples across an organization in unspoken and obvious ways faster than you think.  Be aware and cognizant of your actions at all times.

 -         Firing someone is hard, but not acting quickly and decisively to address performance and/or culture fit problems is usually even more damaging to the company and other people involved.

I’ll try and get the full set of slides that Professor O’Reilly went through and post them here as I think they are useful for any reader to take a quick look at, stay tuned for those.  In the meantime, I welcome any comments or examples of great leaders who balance both leadership and management.

Update – here are the slides from Professor O’Reilly. They don’t contain the embedded video interviews we went through during the dinner but it should give you a good sense of the material covered and ideas discussed, enjoy —

A few observations:

1. This group has been indirectly responsible for ~25% of MSFT’s annual M&A activity.  Of the ~20 companies MSFT acquires/year, ~5 start with a relationship nurtured by Dan’l's group.  (Note, if you want to be acquired for more than $250m, that will require MSFT BoD approval, otherwise, it can likely get done by a business unit champion.)
2. Partnering can build option value as well.  One of the startups I worked at before Trinity, PolyServe, got a foothold on the Windows ecosystem and ultimately built a meaningful revenue stream co-marketing and co-selling with Microsoft’s SQL Server and Dan’l's group helped pave the way for that partnership. While we didn’t get acquired by Microsoft in the end, it did help spark a successful ~$200m acquisition of Polyserve by HP in 2006.  The key here was finding an emerging or underdog business unit and helping that group win by coupling your product with theirs for a 1+1=3 joint solution. 
3. Azure, SilverLight and Windows 7 are the main new underdogs to tap into right now as a startup.  This makes sense as MSFT invests to play catch up with Google App Engine, Flash and makes up for missteps around Windows Vista. There seem to be serious co-marketing dollars to take advantage of here according to Dan’l.

Of course, when trying to mate with any large corporate giant, you have to be careful not to get stepped on.  Sharepoint, in particular, is their rising juggernaut.  With that said, with Microsoft facing new or emboldened competitors in cloud computing infrastructure and even in core operating system and office markets, they are wisely leveraging partners more than ever.  

Check out Microsoft Startup Zone to learn more.