I am proud to announce a €10 million investment that establishes Spreadshirt at a new stage: we’ve outgrown venture financing and are on to growth financing! For those of you not wrapped up in financing stages of companies, this is like leaving your parents’ home after high school, and heading off to college — paid for with loans your parents didn’t co-sign.

Our decision was similar to that of a college decision. First, we had to decide to go to college. Spreadshirt has strong business fundamentals, including great growth. We’ve been investing profits back into the business. An example: we have 50 more people working for us now than we did this time last year. (I’m proud we’ve been able to create these jobs in this economy.) We discussed the option of moving forward without additional financing. As with college, we decided it was best for our future to take a second round of financing to build a stronger company.

Next, we had to decide which college. There is no guide to financing, like Peterson’s for colleges. We were lucky to have Accel, our current investor to help us find the right partner. We defined three main criteria: growth stage investors, strong European and US presence, and complementary network and experience to ours and Accel’s. Kennet Partners fit this, and more. Max Bleyleben and the Kennet team showed us a partnership mentality from the beginning. One example: one of their first steps was to come to our HQ and production facility in Leipzig, Germany.

Max will join Spreadshirt’s board, and has already attended his first board meeting, just 2 days after we closed the investment. He contributed as if he was a long-time member, fitting right into the team, and providing the thoughtful judgment he shows on his blog, Technofile Europe. He has strong business experience across Europe, and speaks four languages fluently — German, Spanish, French and English.

I could talk about Max’s business credentials, but you know what is important to me… does he get our customer, and what they want to accomplish? Well, he proved to me that he did. For Valentine’s Day, he ordered a Spreadshirt hoodie for his wife. It had a heart on it with a message below it that said, “Fire it up!” Max gets us, and we are lucky to get him and Kennet on board!

And if that wasn’t enough good news to share, I also get to add that Accel showed their continued support for our business and invested in this round as well. When I joined Spreadshirt, I had not worked with Accel. I asked around about them, and heard nothing but positive reviews from entrepreneurs. (I’m generally somewhat suspicious of VCs.) After working with them, I cannot say enough good things about working with Accel, and our partner, Harry Nelis.

This investment would not have been possible without the work and dedication of our founders, Lukasz Gadowski and Matthias Spiess, our motivated and smart management team, and our creative and hard working execution team. I am grateful today and each day for all they do to grow Spreadshirt and me!

Please watch Max’s blog and Gründerszene (German) tomorrow for more. I know you’ll enjoy reading these perspectives. After that (and after my head clears a bit from the pneumonia-curing drugs), I’ll share a bit more about Spreadshirt moving forward.

What’s on my shirt today?


    It’s kind of fun
    to do the impossible
    — Walt Disney

P.S. OK, I have to tell you. It’s an up round. Yep, in this economy. I ❤ Spreadshirt!

The wisdom to know the difference

People that work with me know that I am constantly searching for benchmarks: “Who is the best in the world at this” and how do we learn from them and compare to them? So, when July started looking soft for us, I started calling other retailers and other execs.

To set the stage, our first half of 2008 was incredible. We delivered 97% of a very aggressive plan. Very impressive work from a great team! July started looking soft, but we made a good month in the end. And now August, while we are still posting solid year over year growth, it isn’t where we were, or planned to be. With other execs telling me that they are seeing the same, why am I still feeling frustrated? Am I lacking the wisdom to know the difference between what I can control and what I cannot?

I could say that, but I won’t.
Remember when Bob Nardelli “resigned” from Home Depot? Mr. Nardelli and the board disagreed over his compensation being tied more closely to stockholder gains. He complained that that share price is the one measure that he cannot control. (Read Business Week’s summary.) While I have strong views about the public markets leading to bad executive decisions regarding short-term versus long-term results, I do believe CEOs are in control of their share price. (This does not mean CEOs can always make share prices go up.) Examples are given in the article that while Mr. Nardelli was doing great in some areas, there were other areas, like employee and customer satisfaction, where there were some big questions.
So, yes, the economy impacts my business. But it is my and my team’s responsibility to respond to the economy. It is about risks and contingencies. We need to be prepared. Moving quickly means less reliance on how you did things in the past and more on how you will do them in the future. How do you prepare for that? How do you keep on top of things?

Focus. This is where I have fallen short in the last six months. As things were going well, I let too many visions expand, and didn’t prepare enough for the Summer, and possible impacts of a typically slow season combined with a slow economy. This led to things like missed hand-offs over vacations, not matching an promotional campaign from last year, not pushing some shop partner launches before vacations, etc. All small details, that have overall had a bigger impact.

We are doing too much, missing important details. We need to step back and do less, execute exceptionally well. What are our critical few? Over the next few weeks, I will be working with our team to narrow our list of priorities, so we can deliver an outstanding Fall and Holiday season.

As I think about making tough decisions on priorities, I remember another benchmark I like to keep in mind, a 2006 article from Fortune. It was a study of Fortune 500 companies, comparing founder-led companies to those led by hired executives, like me. Founder-led companies (26 of the 500) overall performed seven percentage points better than the rest of the Fortune 500 over a ten-year period from 1995 to 2005. The two theories presented for why:

  • Founders care more. “Their companies are their life’s work, so they’re more likely to embrace long-term strategies.”
  • Founders tend to be industry experts. “They’re less likely to make the kind of disastrous ‘diversifying’ acquisitions that give M&A a bad name. ” (Note, in smaller companies think diversifying activities versus acquisitions.)

Focus on the long-term and on fewer things. Hired executives can learn that from successful founders. I want to be the best by many measures, not just those that are convenient, or fit me or my team well. Sometimes we use our wisdom to say that there are things we cannot control, using those as an excuse to not master what we can control. I think I would add an amendment to the Serenity Prayer:

Grant me the serenity to accept the things I cannot change;
the courage to change the things I can;
the wisdom to know the difference;
and the perspective to challenge that wisdom, when needed.

What is on my shirt today? One of my favorite Susan B. Anthony quotes:

Failure is impossible

P.S. Failure is impossible is also the title of an exceptional book about Ms. Anthony by Lynn Sherr. I highly recommend it, especially during an election season in the US. Voting is a right and a privilege.

Are you afraid to think?

For 12 years, I’ve had an ad on my desk that says “Are you afraid to think?” to push myself to consider new points of view, new ways of doing things, new possibilities, rather than sticking with only what I know. When I read Heroic Checklist in Fast Company, it reminded me of this ad. Why?

As described, people think that checklists are “basic”, “routine”, and “dull”. I would have said the same. And, while I loved the stats that Chip and Dan cite, like:

When Michigan ICUs put the checklist into practice over a period of 18 months…[snip] saving the hospitals an estimated $175 million…[snip] Oh, and it saved about 1,500 lives.

…what this article made me realize is that checklists actually free you to think. You no longer spend your time remembering steps, but rather noticing what is happening around the steps in your specific situation. Following a checklist does not make you dull or routine, it presents you with time and freedom that can be used for knowledge work — where you are more valuable.

TIP: The authors of this article are Chip and Dan Heath, who wrote Made to Stick, which I’ve blogged on already. While I find Fast Company to be a top quality magazine, generally, I’d subscribe to Fast Company for their column alone. It is that good.

Let me give you a checklist example close to my heart right now. Last year, I did my first Half Iron triathlon. I had a flat. I started to fix it and realized that I was too anxious to remember all the steps quickly. I ran my bike back to the start. While the official race saviors fixed my flat, a woman told me that she puts a checklist in her flat pack. Honestly, at the time, I thought, “Isn’t that cute? I don’t need no stinkin’ checklist. I just need more experience.”

Now, as I face my first IronMan (t-10 days and counting), a checklist for a flat is what I want in my flat pack. I know I can change the flat, but I need to pay attention to details to do it quickly and notice any issues that could cause problems later. I don’t need to spend time second guessing if I put air in the tube before or after putting it in the tire. I do need to notice if the tire is not seated correctly. A checklist would free me to think, rather than remember. Brilliant!

Based on the recent launch of a cool ad campaign of Holiday Inn Express (take a quiz and possibly win a free shirt that express your breakfast identity — powered by Spreadshirt), I recommended a “shop launch checklist” to our sales team. Nothing went wrong with the launch that prompted this, but I saw it could have been easier on the team. Creating multiple shops (for free t winners and non-winners) — each with many details and the strenuous tracking requirements of a contest — would have been easier if the team could have only focused where their thinking would add value, rather than the dull routine work of remembering when to dot an i and cross a t.

So, what is on my shirt today?

humbled by simplicity

 

A special request for my friends and family:

In 10 days, Evan and I are attempting our first IronMan. There is a terrific report written by an IMBrazil 2007 finisher that covers how lonely this course is. I wondered how we could take the spirit of you with us, and I had an idea. You know I’m addicted to personalized shirts now, as I love this form of expression. I’m asking that you to go to the Spreadshirt Designer, design a shirt that would inspire you (a quote, a graphic, a saying, one word), order it, take your picture in it, and email me the pic. We’ll take them with us on the 112 mile bike ride for when we need a boost. For free standard shipping, enter goeggers as the coupon during check out. You should order by Sunday to get the shirt in time. If you can and want to do this, thanks for giving us this special boost for the tough miles!

[For my EU friends, by late morning, goeggers will also work for free standard shipping in the EU Spreadshirt Designer. The .com coupon works now.]

OLP, CNN, jetlag and training

I was going to post something more thoughtful tonight, but the new season of The Unit started last night and Evan and I had to “sling” it tonight. What can I say? I worked at Los Alamos, remember? I’m amused by secret government operatives, since I knew a few spooks there. 😉

So, something a little less serious tonight:

  • In case any of you are forgetting what I look like, here are some vids for you:
  • This brings up point number two… yes, those are dark circles under my eyes. As I looked at myself in the mirror tonight, I thought “Hmmmm… I should have added ‘deal with jetlag’ as some percentage in my ‘what a CEO should be doing’ post.” I’d say that’s another 10%. Jenny, I hope that didn’t scare the horses. 😉
  • And point number three… I’m almost, possibly ready to go public with this… I am considering… doing Ironman Brazil in May. There I did it. Evan’s keen on doing one as soon as possible, and this one is open, and early in the season. My friend (and Ironman) Paul Mccarron told me when I started with my first sprint (Duxbury 2005 — I did not think I would finish!) that I would end up doing an Ironman. How did he know? So far, training has been going well. Thanks to Matthias (co-founder and CTO Spreadshirt) who is making me run FASTER and more often. One thing I know for sure… I will have the best shirt!

Well, on that note, I need to go and work on the circles under my eyes. I hope you are all well. Thanks for indulging me tonight.

The #1 Question for a New CEO

Based on recent experience, what is the #1 question asked about a new CEO?

“What will change?”

Or specifically in our case: “What will be different now that Jana, the American is in charge, rather than Lukasz, the founder?” Three answers given most often:

  1. I’ll add more process (sometimes said in the negative sense, “I’ll add bureaucracy”)
  2. I’ll be more US market focused (including will you move the company to the US)
  3. English will be our corporate language

These aren’t my answers, but the ones given most often from what I’ve read and heard… sometimes created or assumed by an outsider, sometimes implied or directly said by an insider.

So, what are my answers?

  1. De-centralize management. About a month ago, Lukasz asked me if I would have done a project the way it was being done. I told him no. He asked why I “let that happen”. I explained why I believed the project was within the tolerance levels of “right”, and that as a leader my role was to set the end goal, give guidelines as how we work as a company, and then support the team in getting to the goal themselves. Guidelines are often expressed as process, so yes, likely this will include some process.
  2. Take us beyond Web 2.0. While I am excited about the North American market due to both its t-shirt culture and giddiness over self expression, what I like is our opportunity beyond the Web2.0 leaders into the mass market in all of our markets. Based on the company’s success, it is often overlooked that we have an incredible growth opportunity here in Germany, in France, in the UK, in the US, in all of our markets. It is our turn to cross Geoffrey Moore’s chasm from the early adopters to the early majority.
  3. Say no more often. De-centralizing management and crossing chasms is a lot of work. We need to focus and deliver with exceptional quality across our priorities in order to succeed to the level available to us. To focus, we need to do less… and to do that, we need to say no. So, yes, perhaps the amount of English will increase… by the word “no”. 😉

So, what is on my shirt today? For some reason “Hazy Shade of Winter”, written by Paul Simon, resonates with me when thinking about our current stage. The song goes from “look around, leaves are brown” to “look around, grass is high”. It is easy to see the brown leaves as we go through the process of change, but we need to stay focused on where we are headed… high grass, ripe fields.

See what’s become of me

This would have been a great shirt for my 20th high school reunion this Summer! 🙂

P.S. Some folks were confused about the whole “90 days” thing. I didn’t mean I would blog EVERY day, but I will blog more than once per week and discuss directly the things that are happening during this change. Oh, and feel free to ask me questions… that you want to know about during this change. I’m game for Q&A!

I've been quiet, I know… but get ready for a 90-day roller coaster!

The main reason for my being quiet was work… work I couldn’t really talk about. For my first six months at Spreadshirt, Lukasz, Matthias, Michael, and I — along with lots of folks from across the company — worked on mission, strategy, business analysis and organization structure to understand who we were, who we wanted to be, where we were and where we were going. I’m excited about the results, but that’s not the point of this post; I’ll share that in the coming days, weeks and months.

The purpose of this post is what happened around months six through nine, at least from my perspective. The quick version… Lukasz realized he gets more energy from angel investing and advising, than running the daily operations of Spreadshirt. The result of this is that as of today, I’m the global CEO of Spreadshirt. (See “Gadowski Passes CEO Baton to Eggers”, our news release, for more details.)

This was a process of discovery peppered with confusion, excitement, frustration, opportunity, and fear; and I’ll be open and say for the most part, it wasn’t fun. Being the newbie, outsider, and foreigner on this executive board made my position awkward for me and Lukasz, Matthias, and Michael. (One memorable moment was sitting in my Leipzig flat at 2 in the morning, talking through things with Lukasz and telling him overall, I just wanted to go home. That was exhaustion speaking.) Despite that, I feel lucky that they were the team on this journey with me.

Since this blog is about learnings, I thought I’d share my top three from this experience:

  1. Find a “perspective” board. You’ve heard of a sounding board; I’m going to propose a different twist. This is a specific person that you find for a certain perspective. I stumbled upon this. I happened to call Scott Cook, founder of Intuit, for advice on the potential of my being CEO. He gave me that advice, but more importantly, what he gave me was the perspective of what it is like to hand your company over to someone else. And woah, did that make me put the angst and frustration that I felt at times in perspective.
  2. Make a network map. Call me a geek, but this is an effective tool to think through who is connected to whom, how, and what impact the connections have. It seems calculating, but it is really about making sure you understand the network of what is happening in a complex decision framework. I made big mistakes here, so it is the area I would change the most if I got a “do over”. I was stuck on conversations with Lukasz, and while I did talk with Michael and Matthias, I should have done that more for learning and understanding where they were.
  3. Write down a working together principle. This piece worked well for us. Our working principle was simple: “Don’t assume. Ask questions.” We were pretty dedicated to it, and it felt good to be able to say to someone, “I feel like you are assuming…” and know they would understand immediately and the discussion then changed tone… most often.

I hope these help you in some way. I’m always happy to hear your comments and suggestions.

Now, what is this about the 90-day roller coaster? My goal is to document my first 90 days as the global CEO for Spreadshirt. I’m going to be as open as I can, which if you know Spreadshirt is pretty darned open. So… here’s to day 1! 😀

What is on my shirt today?

If something goes wrong,
        don’t follow it

I got this tip from a fortune cookie and immediately made it into a shirt. I feel that our “working together” principle helped us not follow something when it seemed like it might be going wrong.

Things that make you feel good

First, I apologize for being quiet for so long. In addition to my travels across the ocean, I have been training. And that leads me to what things made me feel good the past two weekends:

  1. Last weekend, Evan and I finished a HalfIron triathlon. People are impressed when we say we do triathlons, then less impressed when we say HalfIron triathlons. It sounds like half, but it is more. I came in near last. Due to the work that went into this, the fear of not finishing due to a flat tire, the dread of starting a 13.1 mile run, when I was exhausted… I have a very warm sense of accomplishment for my near last half. 😉
  2. We had my parents, and four of our dear friends join us at the finish line. My parents drove over 3 days from Arkansas, and waited around all day (over 8 hours!) from before we started to the very end just to see those final steps. Our friends Mark and MJ took away time from their vacation to push us on with signs like, “Faster, we’re hungry!” And then there was Anna… 9+ months pregnant and surprising the heck out of me at the finish! Scott, I love you too, but Anna is PREGNANT… scratch that WAS pregnant… congrats, the baby scanna came TODAY!! 🙂
  3. Traveling to Germany this weekend, a man came over to me at the airport and explained he was making a career change to pharmaceutical sales. As I started to wonder why this was relevant to me, he said, “And you’ve just helped me. I was nervous, and your shirt gave me a new attitude.” A simple white shirt, with simple black text gives someone a needed lift. How great is that? I love my job. 🙂

Thanks to you all for being patient with me. I look forward to writing more… because it does make me feel good.

What was on my shirt for the race?

Swim.Bike.Run.
     EAT!!!

What was on my shirt at the airport?

 Fear less.
Hope more.