Startups and Scaling (EP.80)
The podcast is available for free on your favorite podcasting platforms:
Apple Podcasts | Spotify | Stitcher | TuneIn | RSS Feed
Updated
November 14, 2024
In this episode of Work Shouldn’t Suck, host Tim Cynova is rejoined by co-host Lauren Ruffin and special guest Adam Huttler, the founder of Fractured Atlas and current head of product and technology at MonkeyPod, another company he founded. Together, they dive into the nuances of starting and scaling organizations, drawing from their shared experiences at Fractured Atlas and beyond.
The conversation explores the intricacies of startups and scaling, including the critical transition points, calibrating risk between staff and boards, the importance of intellectual honesty, and the role slack plays in supporting a culture of learning.
Key Highlights:
Product-Market Fit [02:09]
Startup Phase Challenges [02:56]
Transitioning to Scaling Mode [03:22]
Experimentation & Intellectual Honesty [04:45]
Evaluating Team & Leadership [08:35]
Nonprofit Sector Dynamics [13:51]
Risk Calibration in Nonprofits [20:08]
Strategic Planning & Strategic Thinking in Organizations [26:11]
Hybrid Workplace & Organizational Culture [32:27]
Building High-Performing Teams [36:30]
Creating Space for Learning & Growth [44:55]
Bios
Adam Huttler is the founder and head of product of MonkeyPod, an all-in-one software platform for nonprofit organizations that supports accounting, donor management, fundraising, collaboration, and more. A serial entrepreneur at the intersection of technology, culture, and social justice, his career emphasizes developing innovative business models and revenue strategies for mission-driven companies, in both the for-profit and non-profit sectors.
In 1997, Adam founded Fractured Atlas, a non-profit technology company that helps artists with the business aspects of their work. During Adam's twenty years as CEO, the organization grew from a one-man-band housed in an East Harlem studio apartment to a broad-based service organization with an annual budget of $25 million. When he left in 2017, Fractured Atlas's services had grown to reach over 1.5 million artists across North America and distributed over $250 million to support their work. From 2003-2013, Adam also ran Gemini SBS, a software development firm serving the nonprofit and public sectors. Before being acquired by Fractured Atlas in 2013, Gemini worked with clients such as the US Department of Education, New York University, and the University of North Carolina, among many others. In 2017, Adam left Fractured Atlas to launch Exponential Creativity Ventures, a boutique venture capital fund backing early-stage technology companies that support human creative capacity. ECV was fully deployed as of late 2019, but Adam continues to support and advise ECV's 18 portfolio companies. In 2019, a personal side project became a bona fide startup when Adam publicly launched MonkeyPod. Adam has a B.A. in theater from Sarah Lawrence College, an M.B.A. from New York University, and is a self-taught software developer. In 2011, he was recruited for the inaugural class of National Arts Strategies' Chief Executive Program. He is also an alumnus of Singularity University's Executive Program and the University of California at Berkeley's Venture Capital Executive Program. Adam was named to Crain's New York Business's 2016 "40 Under Forty" class and was listed by Barry's Blog as one of the "Top 50 Most Powerful and Influential Leaders in Nonprofit Arts" for five consecutive years.
Lauren Ruffin (she/her) is the Director and Lead Strategist of Art & Culture at Michigan Central. An expert in responsible innovation, her work centers on defining and implementing best practices for organizations reshaping the world through technology to ensure their platforms are safe, equitable and beneficial for all users. From 2016-2021 she served as Chief External Relations Officer and co-CEO of Fractured Atlas, the largest association of independent artists in the United States, where she oversaw marketing, communications, community engagement and fundraising for the nonprofit. In 2017 Ruffin co-founded CRUX, an immersive storytelling cooperative that collaborated with Black artists creating content in virtual and augmented reality (XR). In addition to her work as co-director at Michigan Centra, Ruffin is an Associate Professor of Worldbuilding and Visualizing Futures at Arizona State University where she explores the unprecedented and rapid political and social changes taking place in every facet of modern life due to advances in technology. Ruffin has held various positions at the NAACP Legal Defense Fund, Children’s Defense Fund, New Leaders and AAUW and has served on the governing and advisory boards of Black Innovation Alliance, Black Girls Code, ArtUp, Black Girl Ventures and Main Street Phoenix Cooperative. She graduated from Mount Holyoke College with a degree in Political Science and obtained her J.D. from the Howard University School of Law.
Tim Cynova, SPHR (he/him) is the Principal of WSS HR LABS, an HR and org design consultancy helping to reimagine workplaces where everyone can thrive. He is a certified Senior Professional in Human Resources (SPHR) and a trained mediator, and has served on the faculty of Minneapolis College of Art & Design, the Banff Centre for Arts & Creativity (Banff, Canada) and The New School (New York City) teaching courses in People-Centric Organizational Design, and Strategic HR. In 2021, he concluded a 12-year tenure leading Fractured Atlas, a $30M, entirely virtual non-profit technology company and the largest association of independent artists in the U.S., where he served in both the Chief Operating Officer and Co-CEO roles (part of a four-person, shared, non-hierarchical leadership team), and was deeply involved in its work to become an anti-racist, anti-oppressive organization since they made that commitment in 2013. Earlier in his career, Tim was the Executive Director of The Parsons Dance Company and of High 5 Tickets to the Arts in New York City, had a memorable stint with the Cincinnati Symphony Orchestra, was a one-time classical trombonist, musicologist, and for five years in his youth he delivered newspapers for the Evansville, Indiana Courier-Press. Learn more on LinkedIn.
Transcript
Tim Cynova:
Hi, I am Tim Cynova, and welcome to Work Shouldn't Suck, a podcast about, well, that. Today's episode, Startups and Scaling, is a particular treat, because after a brief sabbatical from the podcast, I'm rejoined by podcasting's favorite co-host, and thrower of curveballs in said podcast conversations, Lauren Ruffin. And we're reuniting with a colleague from our Fractured Atlas days, founder of that organization and more, Adam Huttler. We have so much to unpack and explore this conversation, that I don't even want spend any more time on the preamble. The conversation is going to be great. We're going to cover a lot of ground, answer frequently asked questions about startups and scaling, offer a few unconventional approaches. Lauren will probably throw a curveball or two, so let's jump right in. Without further ado, Adam and Lauren, welcome to, and back to, the podcast.
Adam Huttler:
Hey, Tim. Hey, Lauren. Great to see you both. I'm really excited to be here.
Lauren Ruffin:
The three of us haven't been together in this way, in so long, I'm excited. And Adam, it'll be really good to learn more about what you're up to.
Adam Huttler:
Yeah, thank you. That's cool.
Tim Cynova:
Well, and speaking about what you've been up to, Adam, why don't we start with how do you typically introduce yourself and the work you do these days?
Adam Huttler:
I guess I would say I'm the founder, and I'm the head of product and technology for MonkeyPod, which is a software platform for nonprofit organizations, kind of a true all-in-one nonprofit in a box, helps you do everything from nonprofit accounting to donor management, fundraising, budgeting, email marketing, really everything you need to run an effective nonprofit organization.
Lauren Ruffin:
Whenever I think about folks who have been super intentional about the distinction between being a startup organization and an organization that's about to scale, I think about you, and I think it would be really helpful, Adam, if you could talk a bit more about how an organization can recognize that nexus point, and sort of make that jump between the flurry of being a startup, into a more perhaps thoughtful, or planned moment of scale.
Adam Huttler:
In tech startup land, we often talk about product-market fit, that's the term that gets used. This is kind of the key milestone for an early stage startup, and the idea is that you're looking for confirmation that you've identified an authentic market gap, and that you've built a product that effectively serves that market. Now, I would say the concept applies equally well to nonprofits, you just have to have a less literal definition of product. But until you hit that milestone, I would say you're in startup mode, and this is going to be defined by experimentation and a lot of pivots. You're learning about the market, you're talking to constituents to better understand their needs. You're identifying the core value proposition that you can offer to meet those needs, and of course, you're trying to figure out if it can be delivered at a price the market will accept.
I would say in the startup phase, the critical challenges are things like being intellectually honest about what's working and what isn't, being rigorous, and asking specific and intentional questions, and then setting out to answer them, almost like a scientific method approach. Being able to pivot quickly without over-correcting. And of course, you've got to be really lean in your operations during this phase, because you probably don't have a lot of resources, so you got to make do with what you've got. But then of course, after you hit product-market fit, once you feel confident that you've reached that inflection point, that's when you shift to scaling mode. You've got a product, a service, a program, that works fundamentally, and so now the goal is scaling it and growing your market share, or reaching more constituents, and doing so as efficiently as possible.
One of the interesting differences between for-profits and nonprofits has to do with sources of capital and funding. If you're in for-profit startup land, investors really, for the most part, are looking for startups that have already hit that product-market fit. They don't want to pay for your flailing experimentation, right? They want a functional engine that they can just provide fuel for it, because that's the business they're in. And I would say some funders in the nonprofit space have a similar attitude, and that's fine. That's an important part of the ecosystem, but I also think some of the more enlightened creative funders are going to be a little more willing to invest in that initial phase of work than you might find in the for-profit sector.
Lauren Ruffin:
That really resonates with me on a couple of different levels. I keep thinking back to how often we talked about experimentation openly at Fractured Atlas. And in some ways, Fractured Atlas had a very long tale of experimentation, which was really, really lovely.
Adam Huttler:
I agree. I mean, I think experimentation, and maybe more importantly, intentional experimentation, honest experimentation, is really critical for any organization, nonprofit, for-profit, et cetera, right? You got to do it all. You have to ask the right questions, or ask good questions at least, set out to test them in a way that's rigorous, and then you got to be honest with yourself about the answers, and unsentimental about changing course if something doesn't work, or if your hypothesis was wrong, that's equally valid information.
Tim Cynova:
We've already referenced Fractured Atlas a bit already, so I want to flash back about 25 years or so, because you've actually started and scaled multiple organizations, and those organizations in turn, are helping other organizations start and scale themselves. I imagine the number of organizations you've helped to scale is well over 10,000 by this point, so you've seen this arc many times to say the least, this arc of what people need, what organizations need, what approaches are likely to be successful, what approaches are likely not to be as successful, when you should scale versus when you might want to stay the size you are. And so I'm curious, if we can go back to those early days of Adam Huttler, to unpack that exploration of how you, yourself, were testing ideas and deciding which ones to keep, which ones to jettison, and which ones still inform your current approach and work with MonkeyPod.
Adam Huttler:
I was only 20 years old when I founded Fractured Atlas. I was still in college, it was summer between my junior and senior year. And in my 20s, I think I kind of had the advantages of arrogance and ignorance to some degree. I'm sure I had some legitimately good ideas, but I also was unburdened by nuance to some extent. So a lot of what I would advocate today, I don't know that I was doing back then. I was definitely experimenting. I was moving fast, I was trying things. I was going all in on this idea or that. In some cases, I got lucky. In some cases, it was just a function of persistence and sticking with it, and keeping at it, and whatever. I would say I'm a lot more sort of rigorous and intentional, I guess, in my approach today, and I also have more cognizant of edge cases and nuances, and all of the ways in which sort of simple bold ideas don't always fit every scenario, and that is both a good and a bad thing.
I think it's mostly a good thing. But just in terms of efficacy at launching and building an organization, there are times when you get too bogged down in that kind of thinking. I think the nonprofit sector does that a lot, where they kind of overthink problems, or they get paralyzed by [inaudible 00:07:32] and nuance, and understanding all the angles, and all the different wrinkles and issues of a complex subject. Whereas I think one of the things that startups often do well, is they're untroubled by those kinds of complexities, and they just rush on in. And I think that's a little bit how I did things, for better or worse, in those earliest days of my career.
Lauren Ruffin:
Recently, I've been talking to more and more organizations that are sort of at that point. These are largely nonprofits, and the ones that aren't explicitly nonprofit, most certainly have some sort of social enterprise, or social impact bent. They've come to some understanding of product-market fit. They've got some, either community support or customer support or funder support. They've sort of reached that inflection point where they understand that what got them to that point might not be what gets to the next level, especially when you're talking about small, intimate teams that often form the sort of early stages of organizations. That can be a really hard leadership challenge to really have to face. And also it's because the people who got them there provided the opportunity to be ready to scale.
I guess the question is, and you and Tim together, have gone through so many different iterations of this question around hiring and upskilling. So how do you know if it's a matter of upskilling your existing colleagues, or it's time to encourage some folks to move on, or move out, or to find some other role as a supporter of an organization? I've watched both of you, and Tim, I wouldn't mind if you jumped in on this a little bit too, because I know it's something you think about a lot. I don't know if I've ever asked you, in all of our years of doing this together, asked you to also respond to a question, but I feel like together, y'all are going to give a really meaty answer to that.
Adam Huttler:
I don't know that there's an easy kind of blanket answer, it's so circumstantial. But we talked about the need to be intellectually honest and unsentimental in experimentation, in identifying what works and what doesn't, and I think that attitude applies here as well. To be an effective leader, you have to be self-aware, you have be unsentimental, I think. Founders in particular, especially in the nonprofit sector, are often really [inaudible 00:09:45] domain experts. You don't fund a nonprofit organization because you're excited about budgeting or impact analytics. You start a nonprofit because there's an impact that you want to make in the world, and maybe you're a great choreographer, or you're passionate about environmental preservation, or education, or food security, or whatever it is, but that's the thing that's driving you, it's not the logistics of running an organization. So in some ways, I think those kinds of founders often have a great head start at that product-market fit piece because they do usually have a pretty good understanding of the problem that they're trying to address or mitigate, and so they can often move pretty quickly to an effective solution.
But then of course, it's easy to become a victim of your own success. One possible difference, or sometimes a difference between nonprofits and for-profits, is that I think nonprofits, in my experience, are a bit more likely to perceive a kind of moral obligation to dance with the one that brought you. I would argue if the mission is being held back by the one that brought you, then you've got a moral obligation to find a new dance partner. Sometimes that means designing job scopes and an organizational chart that puts that founder, or other early employees, in the best possible position to contribute to the organization's work on an ongoing basis, and sometimes it means compassionately, humanely, gracefully transitioning that person out. And this is where that self-aware part is so important for leaders, because if you've got a founder who can't, or won't acknowledge their own limitations, that can easily become an existential obstacle to the organization's growth and success from that point forward.
Tim Cynova:
A couple of things about this question resonate for me. Adam, you pointed out earlier that this work is happening within resource realities, resource constraints, right? Organizations don't have unlimited time and money to do the thing that they're trying to do, and so there are various related constraints. Also, knowing how people are calibrated to their learning edge is important. Are they oriented to learning and development and growth, or are they like "This is what I do and how I do it?" And I'll add, you could possibly be really high performing with that ladder calibration in certain settings, but we're specifically talking about startups and scaling. If people aren't calibrated to learning and development, no matter how much time or hope you put into it, they're probably never going to have the subject matter expertise, or what the organization needs of them in the role, in the timeframe that it's needed.
So I think your point about let's find ways with care and humanity to say, "How can we use this opportunity to get to what's next?" But everyone banging their heads against the wall is not helping the current scenario, and it's just going to get more frustrating for everyone. I think the other point here, is when is it a solved problem that you can just adapt, and when is it reinventing the wheel? Especially, when we think about organizations who are trying to be anti-racist, or center justice, equity, inclusion into their policies and practices, that's often not a solved problem. You just can't pull the book off the shelf that tells you step-by-step, exactly how to do it. So every piece of this is constantly iterating while you're trying to make enough money to keep this thing going, and do it in a values-aligned way. And those couple of pieces have been marinating for me, because unfortunately, this isn't just do these three things and you can figure out if this is going to work or not.
Adam Huttler:
I love that you brought that up about solved problems versus reinventing wheels. One of the things that I really loved about working with you in our collaboration over the years, was that I think my instinct is always to invent a new wheel, always. And your instinct is always to try to figure out who's dealt with this before, who can I talk to, who has solved this problem? The truth is some wheels are crap and need to be reinvented, but often they don't, and so I think you and I really complimented each other well in that respect, and we're able to find a nice balance and mix of approaches.
Lauren Ruffin:
I feel like we're dangerously close to going down a rabbit hole about the value of square wheels. So Tim, you should take that next question.
Tim Cynova:
Adam, the two of us have spent the bulk of our careers working in, with, and for the nonprofit sector. The creative part of that sector more specifically. And the nonprofit creative sector ironically, isn't particularly known for its innovation, creativity, and risk-taking when it comes to how those organizations actually operate. Even though they might be producing some amazingly creative, quote-unquote, products or art, their operations are pretty dusty. I'm wondering, having spent 20, 25 years in, and with this space, how does that resonate for you these days?
Adam Huttler:
We were talking earlier about the fact that particularly, small nonprofits, almost everyone, certainly the founder is usually going to be passionate domain expert rather than a functional expert. These are people who are drawn to the work in the first place because they care about the substance of the work, and maybe they have some aptitude for it, rather than the mechanics of the work and the logistics, the budgeting, marketing, et cetera, right? If you're running a small theater company, your director of marketing is more likely to be somebody who trained as an actor and has a good instinct for marketing or messaging, than somebody who has an MBA in marketing and then learned ropes of Procter and Gamble. That's just the reality of that landscape. I don't mean to imply that this is entirely a bad thing. In fact, many ways it's a great thing. You've got a team full of people who are passionate and dedicated. They're not going to leave for a dollar more in salary when the opportunity presents itself.
But the downside is what you pointed out, namely that small nonprofits in particular, are not often crucibles of innovation with respect to operations or financial management. Throughout my career, I would say my work has focused on productizing smart management strategies for nonprofits, and it's partly about addressing this issue. I feel like my job is to identify ways of working, or ways of thinking about your work, that tend to be effective. I don't want to call them best practices, because often so-called best practices are really not, or certainly not universally applicable. But the idea is that if you can find some good ways of doing things, you can kind of embed it in the product, or the service, or whatever it is, and that allows, or that puts those domain experts in the best possible position to make the most out of what they bring to the table without having to be necessarily innovators or experts on some of the behind the scenes logistical stuff.
Tim Cynova:
Well, that's one of the things I appreciate about the work you're doing. It's like don't reinvent how to track restricted grant releases because it's usually going to turn into a really convoluted process. It's more like, "Oh, my God, just do it this way." But sometimes you don't know until you know, and along the way you end up reinventing the wheel because you didn't know it was a solved problem. Building it into the process, into the systems and structures, how do you do that thing so you don't need to even think about? It allows people to make the best use of their limited time and resources so they can think about all the other things that are a better use of their time and expertise.
Adam Huttler:
Back to sort of solve problems versus new wheels, MonkeyPod is unapologetically opinionated, similar to the way Fractured Atlas was, in so far as there are ways that we guide you toward doing things in the product. Some of them are very established conventional wisdom, like this is a solved problem, et cetera, and some of them are not. Some of them depart from industry norms and conventions very intentionally. These are things that, throughout my 25 years of working in and around nonprofits, where I feel confident that there is a better way, and we've tried to make that into the product and give people a platform that allows to leverage that.
Tim Cynova:
Is there an example you can share with us?
Adam Huttler:
A lot of them have to do with how you think about money and how you think about tracking money. There are little things about how MonkeyPod encourages you to set up your chart of accounts, for example, or to use other dimensions of tracking your financial activity in a way that was designed to facilitate good board financial reports. I've been on a million boards. I worked with the board for a very long time. I've seen no small number of terrible financial reports at board meetings, some of which I probably was responsible for, none of which you were responsible for, Tim, I should point that out.
Tim Cynova:
Well, there's one glitch in that memory. My very first board meeting at Fractured Atlas was a month or two after I arrived, and also coincided with me racing to get to the airport to catch a flight. I quickly emailed you the financials for the board packet, which included a balance sheet that did not balance.
Adam Huttler:
Oh, nice. Oh, good. Somehow I blocked that out of my memory.
Tim Cynova:
But yeah, after that it was great.
Lauren Ruffin:
And then Adam found himself wondering whether he could upskill or not.
Adam Huttler:
Right, yeah. God, this Tim guy is really passionate about the work, but he just can't do the logistical stuff, so how do I put him in a position to not suck so much? Yes.
Lauren Ruffin:
Exactly.
Adam Huttler:
That was the question I was asking myself. So the point is I've seen bad board reports, I've seen good board reports, and I've known lots of otherwise brilliant executive directors at small nonprofits who don't necessarily have enough perspective or experience to be a good judge of what makes a... Because often what your board is asking you for is not actually what they need, and what's actually going to make them a more effective board. In fact, I would say you're thinking more than 50% of the time that's the case. The answer isn't just about giving your board what they're asking for, it's about giving them information that's actionable, that's useful, that is at the appropriate altitude for them to be able to advise and guide and provide that oversight without getting too deep into the operational needs. There's an art to it, and it's a little bit of a tightrope walk. That's just one of the ways that we try to set folks up for success when they adopt MonkeyPod to run their organization.
Lauren Ruffin:
The innovation, or lack thereof, around nonprofit finances, I mean, that's a whole separate conversation for the three of us to have at a later date.
Adam Huttler:
It is, yeah.
Lauren Ruffin:
But on the topic of boards, I did want to talk a bit about risk tolerance and how we assess risk. Getting back to that conversation about the various stages of organizational development, maybe there's an idea that the riskiest period for an organization is when it is in startup mode. I wonder if that's really true, because then you get into sort of the steady or unsteady state of nonprofit management, which involves boards and governance, and the disconnect between what a board views as risk versus what staff feel is risky. It always comes up with regard to budgets, definitely with regard to deficit budgets. I'm curious if, as you've gotten further away from having that sort of board, maybe having even more autonomy around assessing risk. When we were working together, I really appreciated your super high tolerance for risk, and I always wondered was that because it was in opposition almost, to folks who had less risk tolerance sometimes? And I'm wondering if that's recalibrated, maybe it's a growth circle, both for you and as organizations are maturing, but I'm just really curious about risk tolerance.
Adam Huttler:
If I can praise my former partner in crime, Tim, for another minute. That was another thing that I really appreciated about that collaboration. Tim was great at putting guardrails in place, because I do have a pretty high risk tolerance by nature. I like to try things. I get excited about an idea, I want to run off in a particular direction or whatever, and Tim was a great COO because he fundamentally tried to create an environment where it was possible for me to do those things, but also where there were guardrails in place to protect me from my own worst impulses at times, or from going too far afield, or falling off the edge of the Earth in some cases. So you talked about was my risk tolerance partly a function of having an opposing force in place, and I don't know that I would put it quite that way, but it's easier to have a high risk tolerance if you do have people who you're collaborating with who can help rein you in and keep you in check.
And I suppose it could go the other way. You could have a CEO who's more grounded and bounded, and COO who's more... But probably that wouldn't work as well. And you talked a lot about boards and board risk tolerance, I do think it's a chronic, nearly universal problem in the nonprofit sector, that boards are bad at risk calibration and risk assessment. In some ways, they're too risk-averse, they tend to be, but in other ways they can be bad at recognizing serious risks that you can only kind of perceive if you're really close to the ground and in the weeds on a day-to-day basis. Even with a good high-functioning board, for the most part, these folks are not really thinking about your work until an hour before the quarterly board meeting, when they review the packets on the way to the meeting.
And even if they're thinking about it in between meetings, or whatever, they don't have as much information. They don't have as much, either structured or just unstructured information about the work, as you and the staff do, and so they often miss a lot of that nuance. And they also tend to have very short memories, which was the thing that I sometimes struggled with. You talked about the deficit budgets. Fractured Atlas was fortunate in that we had a pretty strong balance sheet, and we could afford to operate at a six-figure deficit one year because it would be a bigger six-figure surplus the next year. But if you've got new board members who weren't there for the last five years of six-figure surplus budgets, and now they see a six figure deficit budget, they're going to panic because they don't have that full context.
I don't know that there's an easy solution for that, other than to just be patient and keep providing that context, and reminding them. And to the extent that you can put policies or structures in place that sort of codify some of that risk taking, that's something that we tried to do at Fractured Atlas with things like the strategic opportunities fund. They were giving things names and concepts that help to talk about and frame risk at the board level.
Tim Cynova:
A couple of years ago, I calculated there are 261 working days a year for full-time staff. If a board meets, I don't know, bimonthly, even monthly, the most active board members, those who attend all the meetings, serve on committees, are doing other related work, et cetera, you tally all of their hours, they're likely spending 10 days a year on board things. I'm not knocking those 10 days, especially considering that it's volunteer time for people who could be spending that time in countless other ways. I'm just using that comparison, 261 to 10, to illustrate, of course there's going to be a mis-calibration and disconnect between what staff are experiencing and know about the nuance of the organization, and what's happening with the board, who hold a governance role for the organization.
Lauren Ruffin:
I know that a lot of folks that listen don't understand how Fractured Atlas worked with funders. Can you just give a quick paragraph on that?
Adam Huttler:
Our rule from the beginning, was that we tried to keep the doors open through earned revenue. All of our core products and services and programs, and whatever, ultimately needed to be either self-sustaining based on earned revenue, or they needed to create enough of a surplus through their operations that they could subsidize other key programs and services so that they could operate based on this sort of aggregate earned revenue. When we went to funders, it was usually for growth capital. It was almost like that sort of startup versus scaling thing. We would typically get funders to help with investing in R&D, investing in creating a new program or service or product, or whatever, or trying some major new expansion or whatever. It was always intended to be a one-time capital infusion that would transform, or not, the organization, but then from there we'd be able to keep running on our own steam. That was the idea anyway, it worked pretty well.
Tim Cynova:
I'd like to get your thoughts on operational planning these days. I know back in the day, you had what you described as an aversion to strategic plans, opting instead for strategic priorities that offered flexibility to be opportunistic as unexpected things arose. How do you think about planning and strategic plans these days, both for the organization as a whole, and as you're trying to calibrate participation and understanding among various audiences?
Adam Huttler:
I would say yes, I still am skeptical of strategic planning as it is conventionally or traditionally practiced in the nonprofit sector. Now, I want to be clear, I think strategic thinking and planning, lowercase P, is vitally important. In my experience, where nonprofits can get off track with strategic planning, often they'll plan too far in advance. They'll do a five-year plan, or whatever, and it gets maybe at too low altitude, and it ends up getting into tactics and operations and administrative stuff, which it ends up being a straight jacket more than anything else. And it can also provide a false sense of clarity. We don't know what the heck the world is going to be like five years from... I don't really know what the world's going to be like six months from now. We're two weeks from a pretty critical election. I don't know what the world's going to be like three weeks from now.
Having a plan on paper, that says, "This is what we're going to need to be doing in a year or two years or three years," you got to take it with a full handful of salt because you don't know what you don't know, and I think false clarity around that kind of stuff can be just as dangerous as admitting that you have no idea, and therefore aren't even going to bother trying to plan. Having said that, I do think there are a lot of different tools and frameworks for strategic planning, lowercase S, lowercase P, that can be effective and that can work. Tim, you mentioned the strategic priorities memos that I used to do every year at Fractured Atlas, and that was a very kind of egocentric approach to it as the CEO.
But I would lay out every year, these are the things that I'm thinking about, that I think we ought to be working toward as an organization. These are the opportunities and threats that I see on the horizon, and let's try to be cognizant of those, so as opportunities, positive or negative, arise, we have some context. This isn't the first time we've thought about them. We have some context for thinking about them and reacting. These days, I would say my favorite approach is one that you introduced me to years ago, Tim, which was based on the work of Patrick Lencioni, who's a management consultant. He wrote Five Dysfunctions of the Team and The Advantage, and he's got a kind of strategic play book model, where you establish a thematic goal and certain defining objectives, and standard operating objectives.
Anyway, you're typically looking at something like a three to nine month horizon, and it's really just about establishing clarity among the whole team, and a coherent shared view of what's most important. And I find that really effective. We're actually using that at MonkeyPod now. But there's other approaches that work too. There's OKRs, there's a lot of tools. They can all work. You got to find one that fits for your organization, and then you got to be disciplined about actually doing it, doing the work and keeping on top of it, and tracking how it's going. And if it's not working, finding something else. I think the things to be careful of, particularly in the nonprofit world, are too long of a time horizon, too low altitude, and be wary of false clarity.
Tim Cynova:
Adam, I love that you drop Patrick Lencioni's name, because if it wasn't for Patrick Lencioni, we might not know Lauren Ruffin. When we were hiring the external relations role at Fractured Atlas, in the last paragraph of the job posting, we mentioned something like, "If you enjoy reading the work of Patrick Lencioni." Ruffin has relayed that that was one of the things that stood out for as she read the job posting, and it prompted an, "Oh, maybe this is a different kind of organization where I might enjoy working."
Lauren Ruffin:
There were two things, one was earned income and the other was disagree and commit. That's when I knew I liked you, like both of you. I was like, "If we can really have a freedom to really disagree on an approach but still say I'm going to suck this up for X amount of time, and stay the course," yeah, Lencioni did bring us together.
Adam Huttler:
I love that. There's two of those nuggets that I think came from Patrick Lencioni, one is disagree and commit and one is directionally correct, that really worked well for me, and really resonate with me. Disagree and commit. Yes, to your point, Lauren, having that robust conversation where you can disagree, and you can be candid and open, but once a decision is made, you got to go with it, and commit to it just as hard as if it had been your idea in the first place.
And then directionally correct, the idea that not every decision has to be perfect. In fact, it's almost impossible to ever make a perfect decision. But if you can get to a point where you're directionally correct, you know that this is, generally speaking, the right direction for us to be going in, and we're confident enough of that to commit to it, that kind of gives you the freedom to act. I think that's great, and especially in the nonprofit sector, where there can be so much kind of decision paralysis and overthinking things, and making perfect the enemy of good, and all those kinds of things. Directionally correct can be a really liberating concept.
Lauren Ruffin:
I agree. And for all of Patrick's flaws, I feel like I've been talking about rewriting his book and outlining, rewriting his book to have some sort of power and intersectional analysis of how that shows up in the workplace.
Adam Huttler:
That would be great.
Lauren Ruffin:
Yeah. No, it's going to be a best seller, and then I can go on and be on a real podcast.
Adam Huttler:
I look forward to that.
Lauren Ruffin:
The strategic planning process conversation, it has such a close connection to the unexpectedness that we've gone through over the last decade-plus, because I remember when doing a three to five year strategic plan made sense. I mean, you'll say it never made sense.
Adam Huttler:
It never made sense.
Lauren Ruffin:
But where I was working, which was we had homeless people 20 years ago, we'll have homeless people 20 years from now, both political parties generally agree that that's a bad thing. It made sense in that context, but it absolutely makes no sense now. I think a lot about how what was really apparent to a number of us, who were probably better equipped to look change in the face between 2015 and 2020, the need for a different way of working, and to be really innovative around how people work, really came to the fore during the pandemic.
Adam, you've run successful remote companies for a really long time. Now we're seeing companies sort of... I think Amazon just announced they're going back to five days a week, from three. We're seeing companies sort of go back to an office mandate. I'm wondering what you think about that, because I actually don't know many organizations... I mean, there's probably, where we've worked at Fractured Atlas, and then maybe Automatic was on the early edge of work-from-anywhere remote work, but there aren't a whole lot of companies who can say, "Hey, we've been doing this for this level of duration," with some level of thoughtfulness, like we didn't get forced into it, per se.
Adam Huttler:
I think Fractured Atlas started down that path in 2003 maybe, I think that was when we sort of went paperless. I got a sheet-fed scanner and a good shredder, and we decided to start digitizing everything and get rid of paper records, and that was a step in the direction of having a hybrid workforce, right, where some people were in office, on site, and others were remote. The truth is there are benefits to face-to-face interaction. It's not a complete miss. You can be cynical about the motives of companies like Amazon or whoever, who are trying to force everybody to come back, and I think there are some legitimate critiques that can be made, but they're not wrong that some things work better, or work well, more easily, when people are in the same physical space. There's just this kind of propagation of information throughout an organization.
You can rely much more, on kind of informal channels and overhearing people at the next cubicle, and whatever. That's a real phenomenon, and that doesn't happen nearly as much when you've got a remote working environment. Organizational culture has a lot more inertia, for good or ill, when you've got people in the same physical location, right? Assuming you have a culture that you want, it's easier for new buyers to ease into that culture, and it's easier to maintain the culture that you have. I think the key to making remote work work, is you do have to be intentional about it. You have to find other ways of simulating, or accommodating for some of those benefits that you're not getting on easy mode, by having everybody in the same space. It's just different. You have to make more of an effort on communication and on propagating information.
I think this is maybe especially true when you have a hybrid workforce, where some people are on site and some people are remote. Even little things, like I remember at Fractured Atlas we'd have 15 people in a conference room, and then 10 people on a monitor. You really have to remember that those 10 people on the monitor are every bit as much participants in the meeting as the people around the table, and actively work to include them. And if you do, it can work quite well, but it's easy to be lazy about it and forget, or whatever. You have to be thoughtful about the limitations and opportunities that remote work presents, and not just running an organization the same way you would if it were an in-person thing, just over Zoom, just doesn't work.
Lauren Ruffin:
I did appreciate the rules that we established around having a shared experience digitally. If one person is remote, then everybody's remote. We got to the point, maybe in 2018, 2019, where there was someone who was remote. If we were on with an engineer who was in Seattle, we were all in the office on our laptops, because then there was really a shared experience digitally, of what was happening, as opposed to someone having to constantly say, "Hey, I can't hear the audio on the big screen in the room."
Adam Huttler:
I think that was probably a smart move.
Tim Cynova:
Earlier in the conversation, we talked about risk tolerance, and about how that can be differently calibrated on teams, either because it's your operating default, or because you put it on that role. If everyone has a high risk tolerance, maybe somebody in that room needs to play through how it could all go sideways. I think about this when it comes to building teams, either high performing or higher performing, and how you set the structure for that. How trust is fundamental in that, right?
It's like I'm not just trying to be a stick in the mud on this one, but we've known each other long enough that if Tim feels strongly about it, there's probably something for us to unpack here before we get to disagree and committing. How do we know that we're still going in the right direction, and how do you test for these things when you're hiring for people into roles that are key decision makers in startups, where every new hire is a pretty significant percentage of the team? If you go from one to two people, that's a big percentage. So you're hiring a key role, what questions do you ask? What scenarios do you roll through? How do you know that they're bringing the right knowledge, skills, and experience into the team, and that it'll get you from here to there, wherever there is?
Adam Huttler:
The most important thing is to have a really clear idea of what it is that you're hiring for, first off, for each role, right? And there's some times where you're hiring somebody to be a cog in a machine, and they need to do some functional task repeatedly and whatever, and then you need somebody who, A, can do the task, and B, isn't going to mind doing it again and again. More often, particularly at higher levels, that's not the case. But sometimes, yeah, the most important thing is expertise in a particular thing, either a functional area or a domain area, and you need somebody who, on day one, is going to have the most existing knowledge and experience that's relevant. I think that's less often the case than people maybe think.
What I think is maybe more interesting, is when you're in a position to hire, not for a role in isolation, but you're trying to hire somebody to be on a leadership team, or on a particular high functioning team, and that's where some of the stuff that you're talking about, Tim, really comes into play, because you do have to be able to anticipate how is this person going to affect the group dynamics? How is this person going to affect the conversations we have? Are they going to open up new avenues for exploration that we currently don't have the capacity, or perspective to see? Are they going to bog us down in stuff over here? I think it's important in the hiring process, and in the interview process, whatever, to try to really actively think about that and explore that.
One of the phenomenon that I find most interesting, and that I've observed a million times over the years, has to do with diversity versus homogeneity in teams. I think all of the data shows, or certainly, experience shows, diverse teams outperform in the long run. I mean diversity in demographic diversity, but also cognitive diversity, people who think differently, people who come from different backgrounds, people who have different current life experiences for whatever reason, and also just people who tend to think differently from each other. Over time, if you have a high-functioning, healthy team that has that diversity of perspective, experience, cognitive instincts, you're going to really have a high ceiling for what you can achieve. However, it's not free and it's not instant.
I think one of the things about, for good or ill, and maybe more ill than good, in Silicon Valley, there's a lot of homogenous teams. There's a lot of 24-year-old Stanford grad, white guy, tech bro, and they all get in a room, and they all do their thing. And they're never going to achieve the kind of unexpected, or discontinuous innovation, or really new ways of doing things or thinking about things, as you might get from a more diverse team, but they're going to gel really fast because they have a shared vocabulary on day one. There's a high level of trust from a certain tribal instinct, "Oh, I see myself in that person, therefore I can trust them." More diverse teams take a longer time to come together and to reach their potential. I'm always interested in the long-term more than the short-term, so I do strongly prefer being a part of, and trying to build those more diverse teams, but you got to be honest with yourself about what the constraints are.
Tim Cynova:
I'm curious about the concept of the dip, or the trough, when it comes to startups and scaling. The dip being we need to keep pushing, and we'll eventually get there, versus the trough, which we're never going to get there. We're in a trough and there is no getting out of it, we just need to cut our losses. How do you know which one we might be in? Either we need to wait it out, and then it's all going to click, versus "I wish I would've known three years ago that we should have changed course, changed people, changed approach."
Adam Huttler:
That's so tough and so important, being able to know there's sort of two competing adages. One is try, try again, or persistence wins in the end, and then there's also fail fast and pivot, and those are diametrically opposed in some sense. And I think they both sometimes have merit. And knowing how to recognize when something that's not working would be working with the right tweaks, versus is just fundamentally not the right way to go, I don't know that there is a trick or technique or framework for making those kinds of judgments.
For me, that just comes down to experience and pattern recognition with intellectual honesty, because sometimes the sentimental choice is to want to persist, is to want to believe. I really like this idea, and I think there's parts of it that are working, and if we just keep tinkering, maybe it'll work. That's emotionally satisfying because it doesn't require going back to the drawing board. It doesn't require admitting that you were wrong in first place. You want to be careful of that. But also I think people do sometimes give up too early, or not recognize, fail to recognize that actually, this could work. We just identified the one little missing piece of it that needs to be swapped out, or adjusted, or something. Really hard to do.
Lauren Ruffin:
Admittedly, that question has my mind in a bit of a blender, but I keep thinking about the level of relentlessness that some organizations have about culture and developing a really, really rigorous culture. I've worked for, and with, people who were CEOs, who did nothing but think about how they showed up for the organization, and how the organization showed up in community, and how they were very direct about to how they wanted staff to show up for each other. And I think there's something in that level of really clear and transparent relentlessness about dictating organizational expectations, that outside of workplaces like that, you only really get when you're in kindergarten. Teachers know how to onboard children to education. I think it requires that level of intentionality in organizations. I'm going to be thinking about that for a bit, Tim, because... And maybe it was around the diversity of experiences, and how you develop trust. I hadn't worked in an organization with white people ever in my career until I joined Fractured Atlas.
Adam Huttler:
I don't think I knew that.
Lauren Ruffin:
I didn't really even think about it in the interviewing process, and it didn't hit me probably... Well, it hit me. I started the day of several high profile police murders.
Adam Huttler:
I remember.
Lauren Ruffin:
I really hadn't thought about it in that way, but I'd always come from organizations that were typically led by Black women, or had Black women in leadership, who there was a shared culture, but the staff was super diverse, and they were all united by a mission around serving folks who were living in poverty. And so that mission was the unifying factor that had people quickly get to trust, but it's a really interesting thing thinking about how you build that level of... I don't want to say it's like you dictate a culture, but to a certain extent, leaders, good leaders do.
Adam Huttler:
Well, they model it.
Lauren Ruffin:
They model it. This is how I run a meeting. This is how I talk to my colleagues. This is just how we behave. There's a lot in that question, Tim, that I think is super important, and that I'll have to keep chewing on for a bit. Tim and I have been talking about culture of learning, organizations that are really constantly on a learning edge. What are the incentives for leaders to learn new things and to try new things? And in particular, in a nonprofit sector where you know you're not necessarily be bonused out for a new skill. If you go and get a PhD or this certification, you're not necessarily going to make more money. If you're not a naturally curious person, how do you keep that culture of learning going in an organization?
I was at an event at University of Michigan last week, it was a generative AI event. I was surprised that one of the faculty was saying every day, he got out of bed and said, "How much time am I going to invest today in learning something new?" And he really quantified it by saying, "Some days I only have 15 minutes, but some days I have six or eight hours. What new thing am I going to learn today?" And really thinking about learning as investment, and Tim and I were really thinking about is there a way to incentivize leaders to invest the time in learning new things?
Adam Huttler:
I do think one of the real pernicious problems in the nonprofit sector, is the a sort of asymmetry of risk, in so far as people at nonprofits, whether they're foundations or operating nonprofits, whatever, they often are exposed on the downside. Things go poorly, they can get fired, but they don't have much upside exposure, right? There are no stock options, there's no big IPO at the end of the tunnel, or anything like that, and that can be challenging, and that can be structurally problematic. And I think that's a big part of why we see less healthy risk taking in the nonprofit sector. To your question about learning, you're right, some people are naturally curious, some people less so, but you also do have to have the space for it. So I am, I think, a bit of an autodidact. I like learning new things. I like trying new things, but I have to have the space to do that.
If my job on a day-to-day basis, is such where I'm constantly just putting out fires, or being reactive to things, and dealing with this crisis or that crisis, or crisis, fixing this bug, or whatever it is. When you're in that kind of reactive mode on your back feet, it's almost impossible to learn anything new. One, because you just don't have the time and bandwidth, but also your brain is literally just in a different mode of thinking and operating, where you're thinking defensively rather than creatively. There's an essential prerequisite for having a learning leader, is putting the leader in a position where they're not so bogged down with batting away a million arrows that are constantly flying at them, so that they do have the space and the freedom to explore new ideas and take them wherever they go. Most of them are not going to end up with some great innovation for the organization, where you have to accept that too, but maybe one out of 10 is a home run. Wow. That's totally worth it. Totally, totally worth it.
I know I keep coming back to this, but that's another thing that I appreciated so much about having Tim at Fractured Atlas. I think before Tim got there, I was very much in a reactive mode. I was just dealing with day-to-day, little problems and minutiae, and stupid stuff. It just bogs you down. It became impossible for me to play offense, for me to try new things, learn new things, experiment, whatever it was. And bringing Tim in, and over time, putting structures in place, and putting a team in place where I was less bogged down with that stuff, that was incredibly liberating, and that allowed me to shift my brain back into that creative entrepreneurial learning mode. That's a constant struggle for leaders, I think. But leaders have to have slack, they have to have some space, literally in their calendar, but also just in their brain, to be able to explore.
Tim Cynova:
What you just said about slack and the role you developed at Fractured Atlas, reminds me of one of the biggest challenges of the shared leadership co-CO model, that I don't think we ever solved, if you will. It related to the slack that you brought to the leadership team. Before you left, we had five people on the leadership team. Then you remove one person, we go from five to four while still maintain the CEO function, and we lost the 20%, both slack and as a utility player, who was able to take over those other roles in other's absences. It became four people who never had a day off, right? Because there was no other person on that team to slide in.
And so I think as organizations are wrestling with how to share leadership, how to share power, how to share decision-making, having that slack is, in an organizational context, it's important in a lot of different ways to have the space to learn, to experiment, but also to slide into these other areas. Because when you don't have that, it's a detriment to so many different aspects of the organization's growth and development, and what you're trying to actually achieve.
Adam Huttler:
I wasn't there for that shared leadership experiment, but it's not hard to imagine what you're describing. I mean, I think it's a really difficult thing to pull off. And yeah, you could build in slack for everyone to be able to have that exploration, creative space. I think it's easier when that is concentrated in one person, for whom it's really part of their job.
Lauren Ruffin:
We were working our way towards slack, and then the pandemic happened. And then it was a year of us trying to find our footing, and then we had two folks leave that shared leadership team. We were down to just you and me. The benefit, that's sort of the price of mission, because I think we were still in a much better place psychologically and emotionally, because we weren't leading an organization solo, without anyone to commiserate or talk to about how hard a lot of decisions we had to make, were.
Tim Cynova:
No surprise, our time has flown by. We've covered a lot of ground and still only scratched the surface of so many things, including the work of how values influence the decisions organizations make around how to scale, how to hire, how to plan, and how to risk. So as we bring the plane in for a landing on the conversation today, I wonder, Adam, if you want to land it in any way that picks up an element or two of this work?
Adam Huttler:
On our website, MonkeyPod has a quasi manifesto on the future of nonprofit technology, and in it, we articulate a few core values. One is that community-driven design leads to better, more equitable software. One is data-driven tools amplify mission-driven work. Humans should do human work. And transparency is empowering, not scary. Now, as two people who have worked with me in various contexts for a very long time, I'm sure this all sounds pretty familiar. And obviously, these are framed from MonkeyPod's current work and market, but these basic underlying ideas, I think, have guided me from day one. You do have to know what you believe in. You don't take it on face and never question it. It's important to challenge yourself as you go. But if there are some of those guiding principles that can ground you and provide a sense of direction, I think that can be pretty useful and important for a leader. So there are personal values, there's organizational values, you need to know what do you believe to be true about the world, and how can that guide you toward effective experimentation and solutions.
Tim Cynova:
Well, we've come to the end of our time together today, folks, so I'll end with a heartfelt thank you to both of you. Thank you for sharing your insights and perspective today, yes, but also thank you for being wonderfully inspiring colleagues who have encouraged and pushed my own thinking and learning over the years. It's been a great honor to be in the mix with you two. And thanks so much for being on podcast.
Adam Huttler:
Thank you. Thank you.
Lauren Ruffin:
Been good catching up with y'all.
Adam Huttler:
Yeah, this was a lot of fun.
Tim Cynova:
If you've enjoyed the conversation, or are just feeling generous today, please consider writing a review on iTunes so that others who might be interested in the topic can join the fun too. Give it a thumbs up, or five stars, or phone a friend, whatever your podcasting platform of choice offers. Until next time, thanks for listening.
The podcast is available for free on your favorite podcasting platforms:
Apple Podcasts | Google Podcasts | Spotify | Stitcher | TuneIn | RSS Feed
If you enjoy the show, please leave a review on iTunes to help others discover the podcast.
