Keith Cowing: This is Executives Unplugged. I'm Keith Cowing, your host and executive coach. And with me today is Mahesh Guruswamy. Mahesh is the COO at Kajabi, where he leads product engineering and customer support. He has previously held roles such as the CPTO at Kickstarter and the head of product and engineering at Smartsheet, as well as a number of other positions in builder and leadership roles. And today we're talking about how to help your team be decisive. And competitive and move fast to win in this high velocity world that we all live in. And we get into the messy, hard leadership decisions, like how to set people up with both accountability and authority, how to get rid of the fear and anger in the org that's causing poor decisions, and how to go through the change management of migrating from where you are now and evolving into a world of single-threaded leaders that are very decisive and moving quickly and yet aligning as a team and bringing everybody along for the ride. Let's jump in. Why at Kajabi do you have product and engineering under one person? And what do you think the trade offs are in that? And why is it such a trend right now?
Mahesh: I think the the single biggest reason is it makes the the pace at which decisions can be made like really, really high. So that's the number one reason why I like the single threaded executive model is Just your decision making velocity is orders of magnitude better than what it would be if there was a CTO and a CPO and they had a customer support, et cetera. So that's one aspect. And I've been this model of operating ever since I first encountered it at Amazon has always like stuck with me. I was like, this is a phenomenal way of creating teams and and like putting leaders on top of teams where it's one person making all the decisions, right or wrong, and you're responsible for executing on your vision. Responsible for setting the vision and responsible for the outcomes, like good or bad. And I think the like five years ago, building expertise in a different domain was much, much harder than what it is right now. I was determined to be the single threaded leader when I was at Amazon. So that was sort of my MO going into every new role. So I chased it with every new role that I took after Amazon. And in the beginning, it was it was it was hard because you have to understand what a product manager does. Does what a customer support person does. And to me, it was fun, like learning new disciplines. And that is sort of connected to the second part of your question: what is the drawbacks? So in the early days, I would optimize for what is closest to me and what I understand the best. So if I take, if I think back to Smartsheet, sometimes my decisions were like look through the lens of engineering. So I would focus in on the details of an engineering problem because I was Familiar with it and let the product decisions be made by another person where I wouldn't get involved in the details. And and my engineering team told me that you need to like back off because you're like interfering in like the day-to-day decision making. And the product team was like, you need to get involved more here because we want your involvement in these decisions. So that is a trade-off. And over the years I have become more and more self-aware of what I'm good at and what I'm not good at, and what I'm not good at. I'm like Really self aware of it and I hire for my blind spots. But that is a risk, right? So appointing a product leader as a CPTO or engineering leader as a CPTO is the risk is you might not be self aware. The leader might not be self aware that they have a gap there. And and then try to apply what they know as solutions to every problem, which is which is not how it works. but going back to the first part of your question, with AI, the the pieces that I learned about how product works, which took me s a year to understand this is how research functions, this is how product decisions get made, this is how you get the product market fit, this is how product marketing works, that all you can understand it in like less than a day. Not saying you're gonna get good at it, but you can understand the basics of these are the steps you need to go through. And I would argue that anybody who has sat in any leadership seat for an extended period of time probably has the mental capacity to understand another Domain and another like function. It's just the market has told us for the longest time that, well, we know we don't want like the one person making the decision. We like the tension between a CPO and a CTO, and that's where the right decisions get made. But AI has appended all of it. It has completely flipped it on its head. And the things that I've been saying for the last five years, now everybody's saying it. When I used to say at Smartsheet that hey, it's better to have a single-threaded leader, this was I didn't. have a bunch of like a lot of fans. Like my boss was a fan because he was from Amazon. So he's seen the model work. So he was like, yeah, okay, yeah, I understand why it would work here. But a lot of people are like, this is not gonna work. And now it is somewhat becoming the trend even in in like mainstream technology companies.
Keith Cowing: So you mentioned the tension between Ahead of product and ahead of engineering, being able
Mahesh: Mm-hmm.
Keith Cowing: to make better decisions that way. And there's whether or not there's tension, healthy tension, and then there's
Mahesh: Mm-hmm.
Keith Cowing: whether or not you have a single person making a decision, which do not have to be one and the same thing. So you can have a lot of healthy
Mahesh: Right.
Keith Cowing: tension, but then have somebody who's a tiebreaker just says, Let's go. This is what I'm going to decide to do, but I've heard it all. How do you make sure as a single-threaded leader that you get the healthy tension to increase the quality of your decision making, even though you're going to maintain the velocity and people don't have veto power?
Mahesh: I think it comes down to leadership style. So what I tell my team is The way I challenge you on your decisions, you can challenge me on my decisions too. So I can tell you, I might tell you that I listen, I hear you, but we're gonna go this way, and that's a risk I'm willing to take. But you should challenge me if you think I'm making a decision that is incorrect. And again, you're not gonna people aren't gonna do it on day one, but if you reinforce it, you know, meeting after meeting after meeting, and one of my favorite meetings that I run, I still run, is the business review. So we start with what we want to achieve. As a North Star, initiatives that are gonna get us to the North Star, and the metrics that show success that we're heading in the right direction. And in those meetings, I say, I'm gonna challenge you on this, but you should challenge me on my decisions And if it is not something that I that I'm gonna like agree, then I'll Hey, we're gonna make a choice here, we're gonna move on, and that you just gotta get used to it. And if you don't set that expectation, then you'll become you'll be surrounded by yes men or yes people. and then you'll end up making the wrong decision, basically.
Keith Cowing: Let's dig on that a little bit. So within Kajabi, do you run those business reviews by product area or is it one for the whole company? And then who's the one presenting in that forum?
Mahesh: I run the business review every week and the way I I've done it differently in different companies depending on what the need is. So generally at a high level, it is every product area gets its own section. You talk about how your metrics are doing, the success KPIs, what is going well, what is not going well, what are the risks, and where do you need leadership help from? Or every single week.
Keith Cowing: And you run this every single week. What day of the week do you run it?
Mahesh: so it started in at Amazon. I always do it on Wednesdays. Because that is in the middle of the week, it's not the beginning of the week. So some people will do the homework the week before, but a lot of people will do it on Monday, Tuesday, so you get to Wednesday, and then you're ready to go. and that's when we decide whether we have the course correct, whether we are that these metrics are the right metrics, whether things are moving in the right direction, what do what do people need my help with? That's the forum where we discuss all of this. For Kajabi, we have I have modified a little bit because there are parts of the business that are fairly stable. And I don't want to drag them to a weekly meeting looking at metrics that aren't gonna aren't gonna move every week. So we really for for Kajabi are really focused on there like four or five key product launches that we have done in the last four months. And I want to make sure they hit product market fit. So that's my entire focus. So we're gonna talk about those metrics. How many people are adopting it? What are their what is their feedback? What is the engagement look like? Are these these input metrics are they affecting the output metrics of the company? Revenue, churn, retention, GMV, et cetera. And we talk about that every week. Now, at some point we might go, these things have hit product market fit, or we've decided that they're not gonna hit product market fit, we're gonna scrap it and move in a different direction, and we're gonna go back to like two weeks or once a month or something like that. But to start with, we're doing weekly just so that we can get in the rhythm of talking about these things regularly.
Keith Cowing: That's a serious cadence. A lot of people do this monthly or quarterly, weekly is hey, every single week we need to have our eyes on the prize and be focused.
Mahesh: Yeah, th that's right. Because especially for the new launches we did, they're not they haven't hit product market fit yet. So I don't wanna wait for a month and go, well, we had these problems and I didn't know about it, then yeah, it's not a not a good position to be in.
Keith Cowing: And then tactically, do you take the outputs of that and feed it into markdown files or some repository that AI can access? How do you use all of the great conversation there that's amazing context for AI and
Mahesh: Yeah.
Keith Cowing: leverage it in the future?
Mahesh: all of the weekly business reviews are tabs in a document until it becomes too unwieldy and you have to like roll over to a new document.
Keith Cowing: Mm-hmm.
Mahesh: And that's in the same drive all the time. So if people want to point their Claude to that directory and like read it, more more power to them
Keith Cowing: It's all there across the whole company.
Mahesh: Exactly. And then when we get to board meeting time, I just point my Claude at that directory, sort of pull out what has happened in the last three months, and here's a good, here's a bad, here's the here's the mid mediocre and then give that to the CEO and then who goes sort of figures out like what to what to present to the board. These are Google Docs, yeah. Yeah.
Keith Cowing: Yeah. And these are Google Docs to be specific? Okay. And then what about the transcript? Do you record these sessions? Do you save the transcript and the tension and the discussion?
Mahesh: We we do. we use granola for for all the transcripts
Keith Cowing: Okay.
Mahesh: and some people some people look at the transcripts, but I prefer just going back to the doc itself because I look at the comment and I'll remember that was a conversation in that moment. But but we all of our meetings are recorded on Granola and it's available to everybody who wants to to to take a look at it.
Keith Cowing: So all your meetings at Kajabi by default are recorded and shared.
Mahesh: it's the option to record it is given. All the major meetings are recorded. So if it's a
Keith Cowing: Okay.
Mahesh: review, it's recorded, like all these meetings are recorded. Yeah. All hands.
Keith Cowing: And when when did you make that a clear policy? Was that recently with AI? Had you always been doing that? I see a lot of people struggling with this specific decision of how do we clarify what we're recording, what what we don't, what's private that you record and keep, what's shared, et cetera. And and being really clear is super important.
Mahesh: we've been doing it for a while, and all the big meetings are by default, everybody just pushes the record button because somebody's gonna ask about some context which was discussed in a meeting like a few weeks ago.
Keith Cowing: Mm-hmm.
Mahesh: So it's by default everything is recorded. One-on-one conversations pro probably not. I mean people I mean some managers do record it for future reference etc., but the large meetings always recorded
Keith Cowing: And the managers, do they ask for permission when they record it or they just talk about it ahead of time? These are the conversations people are learning to have right now because it's so such an important thing that's popped up.
Mahesh: nobody asked for permission anymore. It was
Keith Cowing: Okay.
Mahesh: it was a thing maybe a year ago where people like hey we're gonna record it, everybody comfortable with it, not anymore. It's a d it's a default behavior at this point.
Keith Cowing: And I I see that in a lot of places. And then if obviously if you're having a sensitive conversation, you want to not record it, you can say that. But if you know that by default expect it to be recorded, then people behave accordingly. And in some cases,
Mahesh: That's right.
Keith Cowing: you know what, behavior improves a little bit.
Mahesh: That's right, that's right. The other thing I tend to do, and even my boss does it, is if we are in a everybody's in a physical room, we use like a note like a physical note taker. So there are no screens, nothing, and we just want to have a live conversation, we would use like Plaud like note taker or something like that, and hit the record button and then feed that back into whatever you want to store the transcripts. We do that too.
Keith Cowing: Awesome. And so so this is a new way of operating. You have a single threaded leader. You're recording everything. You have all this context, weekly cadence, which is amazing. I love that. now let's talk about change management. So there's
Mahesh: Mm-hmm.
Keith Cowing: people that have all these things in place. And there's people that see where they want to go, but they're not there yet. Maybe they have a CPO and a CTO and they're the CEO's
Mahesh: Mm-hmm.
Keith Cowing: sitting there thinking, do I really want both of these people? Do I want one leader? We're not recording everything. We have to change our, you know, our default.
Mahesh: And yeah.
Keith Cowing: And you don't have to, but there's so much context less left on the table from a AI perspective, if you're not recording things, it's a huge trade
Mahesh: Yeah.
Keith Cowing: off now. And so if you're in the old model, you're trying to get to the new model. you're dealing with people's jobs and livelihoods. your recommendation for how people have these conversations around the leadership table to take
Mahesh: Mm-hmm.
Keith Cowing: on things that are very touchy? If if you have a CPO and a CTO, I see a lot of executive teams where people are elbowing out a little bit to try to mark off their turf because they're afraid, you know, an eight person exec team might turn into
Mahesh: Mm.
Keith Cowing: a six person exec team and they're not sure if they're gonna be one of the ones left in the seat. So it creates a natural tension and it creates
Mahesh: Mm-hmm.
Keith Cowing: an awkwardness. How do you handle those conversations to be open and transparent, but also realize that you know
Mahesh: so maybe this is controversial. I don't think any executive will sacrifice their own turf on their own terms to say, hey, I think for the benefit of the company, I should step away and you should give my domain to somebody else. I have never
Keith Cowing: Yeah. So assume people are self preserving as a as a principle. Yeah.
Mahesh: Yeah, I think people always will be like self preserving. So if you're the CEO you have to look at how quickly are is your executive team making decisions, number one. And this is when like people get to hyperfixate on what is in front of them. The
Keith Cowing: Mm-hmm.
Mahesh: What I've learned, the best way to calibrate your team is to match it up with somebody else. So I would talk to CTOs in similar size companies or even smaller you talk to your peer in a different industry, running a different team, and ask that person, hey, how long does it take for your team to like ship something from zero to one? If they go, if they tell you a number which is orders of magnitude smaller than yours, then that's a problem. So, as a CEO, usually CEOs do a good job of cross-calibrating. They have access to the board, they have access to other CEOs in their network, and that's what you should be doing. You should cross-calibrate yourself with others and go, okay. Okay, my my executive team is much, much slower, so there is a problem. Number one. Number two is what I look for, especially when I look at like In my life, but who should I keep and who should I sort of let them go? Is who cares about the overall business overall, and not show up to a business review, talk about their part, and then just go mute, video off, and go do something else. Because as as AI kind of breaks down the boundaries between functions, I want more business leaders as opposed to an engineering leader or a product leader or a marketing leader. Because if you've been in the industry for 10, 15, 20 years and you can't explain what like CAC is for your business or what L T V for your business is or what your churn looks like or your hypothesis on why churn is up and down this week, then that's a problem, in my opinion. and CEOs should be paying attention to those things. In in like five, six years ago, it was AI was not there, like f like knowledge was hard to come by, even though it was free, like Wikipedia is free, everything is free, but then to be able to like learn from online media was like hard but now it's not hard anymore. So I would say like those are the two things. How quickly is your executive team moving? And two, is your executive team business leaders or are they functional leaders? If they're functional leaders mostly then you have a problem that you need to go fix.
Keith Cowing: There's this underlying theme in everything you're saying, which is that competitive spirit of winning, where on the
Mahesh: That's right. That's right.
Keith Cowing: surface you're saying, okay, well I love th there's a bunch in there. So one part is Looking around the structure of your team and not solving structure for the sake of structure, but looking at the outcomes and saying, are we winning? Are we fast enough? Because if we're not, we have to change something. And if we're fast enough, then fine, it's working. and
Mahesh: Mm-hmm. Right? That's right. That's right. That's right.
Keith Cowing: a lot of times in today's market, you're not, right? So it's you're constantly pushing. And if you're running on a track team and you don't know what the competition looks like, you might feel great. And then you go watch the, you know, the competitors are like, wow, they're beating us by five seconds in the, you know, in the sprint, and they have got these new shoes and this new tool and this that. And it's like, wow, we have to change our game because you know it's the competition. That matters, you just don't see it on a daily basis. So benchmarking is really important. I love
Mahesh: That's right. That's right.
Keith Cowing: your point about are you here to help the company be better? Not just are you here to make yourself or your function better? And that
Mahesh: That's right.
Keith Cowing: mindset is so important right now. and that owner mentality. And then you know, just ultimately coming together to win as a team. And if if you're all in,
Mahesh: Hundred percent. Hundred percent.
Keith Cowing: like that's the one thing that matters more than anything.
Mahesh: That's right, that's right. And just to like to add on to your point, the one team that suffers from this quite a bit, some teams are like wired for that mentality, right? Your marketing teams, sales teams, their product teams a lot of the times, like we wanna go win. We wanna go compete against this other thing and then we're gonna win. Engineering teams on the other hand or like it's slowly coming around to that idea of competing and winning because up until like I don't know, four or five years ago, the theme was let's build the best software, let's build the most scalable thing, let's build let's do it for the sake of the craft. And AI has completely demolished that need, right? But if you think back to, and I've been in many conversations like this, like five years ago, if I tell my engineering team, you know, we're gonna go win as an engineering leader, it's not gonna be received well. Now it is different. I think the the teams themselves are realizing it, and the leaders who don't say those words are the ones going to be left behind. So it is the so just if you know if your audiences are engineering leader, CTO, aspiring CTO, you gotta shift your mindset from I'm gonna build the best software to I'm gonna build the best company, I'm gonna build the most competitive team that's gonna go get stuff done faster and better than the competition and delight your customers and make some money along the way.
Keith Cowing: Digging into that a little bit, you're talking about mindset here
Mahesh: Mm-hmm.
Keith Cowing: and If we think about what makes a winning team, anger and fear are the two emotions that cause all the worst decisions in business
Mahesh: That's right.
Keith Cowing: and life. And right now, anger tends to, in my opinion, frequently in corporate environments come from feeling slighted by another function or another leader, another person.
Mahesh: Yeah, yeah.
Keith Cowing: And a lot of that comes down to communications and things like that. But the fear seems to be the heavier one I see right now in the environment because there's so much change, there's so much happening. If somebody's a CPTO for the first time, they may be fearful that they can't fulfill. the other shoe they haven't worn in the past or a team might be fearful they're going to get automated. There's just chaos in the world. How
Mahesh: Mm.
Keith Cowing: do you think about on your team helping reduce anger and fear so that they can have that mindset of I'm here to win and I have conviction?
Mahesh: I believe that every leader's job, one of their main jobs, is to underwrite risk. Your job is not to like pass down that to your teams. So for example, what I mean by that is I go to a team and the team go and I tell the team, hey, you I want you to do this super risky experiment. And the team goes, or the leader goes, Well, this is there's the risk that this might fail. Is this gonna affect me in my performance review, et cetera, et cetera? The right answer then is you should say, I'm gonna underwrite that risk. If that fails, that's on me. I'll go talk to whoever is above me and convince them, or take the fall for it, like whatever may be the case. But but people who push down that risk, They create this environment of fear. And I've seen this in large tech companies mostly where everybody's afraid of failing because they're gonna get dinged at in their performance reviews. But if you get really good at underwriting risk as a leader, telling people, roll the dice, I'm gonna cover your back, I'll be behind you covering for whatever failures that happen, those are the best outcomes. That's that's when the way you get the best outcomes and the best behavior from teams, because teams look at you and go, Well, your leader has got your back. So we let's go let's go let's go ahead.
Keith Cowing: Can you give me an example of that? A tangible example where you could have offset the risk and given it to your direct report but instead you took on the risk and what that actually looked like?
Mahesh: well take let's say Kajabi for example. the ad platform that we launched. We call it Kajabi Amplify. And there was like the building a marketplace, two set of marketplace and an ad platform onto a TAM that is not used to it is is inherently very risky. Right? So when we were discussing it the the product team was like, Well, we discussed this before, we don't know if it's gonna work or not. and so so I I had conviction that it's gonna work because our competitors are doing it. So so I'm like, okay, we're gonna go do this, let's get the MVP out, let's get some signal, and if it doesn't work, it doesn't work. Like, you know, I'll tell the board that it was my idea and it didn't work. We tried it and it didn't work. it and and then they're like, Okay, let's just go do it. And now it is reasonably successful on its way to getting product market fit.
Keith Cowing: And then where do you cross over towards, okay, we're betting on a few things coming true that may or may not happen. I'm taking risks for that. But also you are responsible for doing a great job. You have to execute
Mahesh: Mm-hmm.
Keith Cowing: well. How do you manage that balance?
Mahesh: personally what I ta what I try to do is divide decisions into one way doors and two way doors. So one way doors are what's that? Yeah, very Amazonian, right?
Keith Cowing: Okay. Very Amazon of you. Very Amazon of you.
Mahesh: One-way doors are you gonna like you can't like easily walk back out. Like you change the name of the company, you change the price, you change branding, you put your team on a project that's gonna take multi multiple months or multiple years. Like that's like one-way doors. And those decisions are somewhat democratic in nature, which means I get a lot of feedback, get feedback from my bosses, get peers, etc. But but the reality is most decisions in companies are two-way doors, right? Even if you want to build a new product feature, build it. Release it, see what happens. If it doesn't work, doesn't work. Like we walk back and then like move on to the next one. so if it's a two-way door decision, I just take I run with a lot of risk. So okay, it it it's fine. It's not a big deal. So that's how I decide like what to kind of roll the dice on and what to like, okay, let's be careful about changing stuff here.
Keith Cowing: And how do you articulate those to the org when you're making them? How do you share the decisions that you're making and how much rigor you're putting into it, et cetera? How do you make that clear to people?
Mahesh: So what I like doing is whenever I join a company, I do a readme form you know, describing me this is who I
Keith Cowing: Mm-hmm.
Mahesh: am, this is how I make decisions. In in that I usually like call out in terms of projects, I want to get involved in the initiation of the project, and then at the end when you try to take it to market. So I just want to be involved in these two and then in the initiation of the project, this is how I make decisions. So one-way doors, two-way doors, and there's a usually a theme f for you know for the next few months. On what your investment thesis is to be. And then, you know, if failures happen, this is what will happen, this is where I take the risk, et cetera, et cetera, et cetera. So, and then usually in WBRs, like business reviews, I reinforce that, saying, yep, this is a two-way door, not a big deal, let's just keep going. It comes to like repetition, the more you say that, the more your team understands the way you operate. and it's you equally it's super important to do that in the in the Zoom world, right? Because everybody's remote and people don't understand. how you operate. It's important to be out there talking about how you make decisions all the time.
Keith Cowing: Th there's one juxtaposition I'd love your your thoughts on where looking at the things that you've accomplished, the teams that you run, the cadence that you keep.
Mahesh: Is it? Is it?
Keith Cowing: You are fiercely competitive and you're here to win. You are also have a calm presence to you in terms of your interactions with people. And I think a lot of times people conflate having a sense of urgency in how you speak, literally just like speaking loud and aggressively, with having
Mahesh: That's right. That's right.
Keith Cowing: a sense of urgency. And you don't have that tone at all. You don't sound like you're on CNBC yelling at people, but you
Mahesh: That's
Keith Cowing: you have a a very ferocious cadence and competitive spirit. So just talk to me about that a little bit. What does being competitive mean to you and how do you what energy do you bring to the room?
Mahesh: it's funny you mentioned you mentioned that because a good friend describes me as calm but oddly ambitious. So the the way the way I think about myself in the world is you have limited time on this planet, right? So I'm forty-five something, so maybe I have like I don't know, forty more years, you know, forty forty-five more years to be on this planet. And I I constantly think about how did I as a person come into being? The confluence of events that led to me being born and being in this place and being in this seat. And the odds of that happening in my mind at least are astronomical, right? You go from stardust to somebody like me and somebody like you, and I just don't want to waste time. So I want to have I want to make a dent in my corner of the universe, however it may be, and and so I have kind of latched on to This is I'm good at tech, I'm good at building teams, I'm good at good at getting stuff done. So I'm gonna make a noticeable dent in that in that universe. And that drives a lot of how I show up and how I behave. But but again, like I don't I tried it once, it didn't work out very very well in terms of modifying the way I show up in terms of like being a type A type person, but but I I'm that's not my my demeanor. but that to your point, but that that doesn't mean I'm not competitive, right? Because every day I get older The sort of fierceness inside me becomes more and more and more because I'm like, okay, I have one less day in the corporate world in my like working life. So I you know is that it? It's
Keith Cowing: Better be worth it. It better be worth it.
Mahesh: better be worth it, right? So, which is why you know that I just don't want to I'm not even Even if I end up make making a gazillion amount of like millions of dollars of money and then I can retire, I still won't stop working because I want to like continue to like have an impact.
Keith Cowing: And in your readme as you think about this,
Mahesh: Mm-hmm.
Keith Cowing: it what are the things that drive you crazy?
Mahesh: I I absolutely hate obfuscation. I I just so it especially in documents, it's so easy to obfuscate stuff, right? We are so for example, the product launch was very good. It's like, okay, what what does that mean? Right? So means how many people used it? You know, did people what thumbs up or thumbs down on the on the little like smiley icon? Or how do you know this was good? Or morale is low. Okay, what does that mean? So I I don't like it when people consciously or subconsciously obfuscate what they're actually trying to say. Because I know that they are trying to prevent a spicy conversation in the meetings or in the written. document they would say which stuff which is sort of watered down and I'm actually the opposite. So if something's not working, I want to hear about it, I want to like know about it. Something you know is is working, then let's just talk about it. Let's figure out how to like put more gasoline on it. On Amazon they call it weasel words. So I I just absolutely dislike people using weasel words because it it kind of like the effort it takes to like pull out the actual like truth from that narrative is like harder. Like it's high. So I prefer people to be blunt and to the point and succinct and you know just be just be open about it.
Keith Cowing: Yeah, I I love the concept of weasel words because it helps you dig into, most of our customers had a, you know, problem. Like, well, hold on, what does that mean? It's like, well, sixty percent of enterprise
Mahesh: That's right. That's right.
Keith Cowing: customers that have multiple locations in multiple countries had the following bug. And 90%
Mahesh: That's right.
Keith Cowing: of SMBs were fine, and this thing happened. It's like you need to get more specific, both in terms of who you're talking about, even customer can be a weasel word if you have multiple
Mahesh: That's right.
Keith Cowing: different personas you're serving, et cetera. And so, you know,
Mahesh: Exactly.
Keith Cowing: using data, using facts, and then say, okay, now what do we think given the objective? But you have to start with a fact base. and it's hard
Mahesh: That's right. That's right. That's right. That's right.
Keith Cowing: to do that because the default is people people use weasel words because it's easier.
Mahesh: It's easier, right. And also like Weasel was also short circuit your critical thinking. So one of my it is in my README is like when you're re putting a narrative in front of me, do not use Weasel words, be precise and all that. So but to this day people still lean into it accidentally, I think, 'cause, you know, I don't think anybody's doing it maliciously, but it's just the way people write, right? And I think I think Claude and AI is making it worse.
Keith Cowing: Yeah, we have to be very careful not to outsource our judgment by accident.
Mahesh: That's right. That's right.
Keith Cowing: We should amplify ourselves, but if you outsource your judgment it's gonna get it's gonna get problematic.
Mahesh: Hundred percent.
Keith Cowing: So, one thing I'd love to hear your take on, you've talked a lot about being a single threaded leader, managing risk, and you know, taking it on yourself and somebody else is doing something to encourage them to take on risk. This combination of authority and accountability, of being able to hold people accountable, but also giving them authority to make the decisions that they need to make. A lot of times teams get those out of whack without realizing it. Where somebody's held accountable, but they can't make all the decisions that they need to make to win. It's like having a sports coach that can't decide. who to bench and who to play and then
Mahesh: Thank you.
Keith Cowing: holding them accountable for the result. And so talk to me about that combination of how do you set up your teams to have the authority but also have the accountability that goes with it. And it's both, it's not one or the other.
Mahesh: Yeah. So which is why I mean again going back to why I love single threaded models, because you can have one person
Keith Cowing: Mm-hmm.
Mahesh: you can tell them your job is to run this product line and show these like success metrics or like run towards this outcome. I try to list down the decisions I wanna make. And the decisions I'll delegate down. So if I remember right, the the latest version of this of my readme, the decisions I want to make is investment thesis on the product areas that you want to invest in, or go to market, or whatever function. So I own that thesis. And then org structure and salaries are mine. Between this like sandbox, if you want to decide the type of product you want to build, the types of features you want to build, the type of go-to-market activity you want to do, that is all yours, and we'll agree on here's the success criteria for these for these initiatives. and then if you know, and then that flows into their goals that we we talk about on a regular basis, etc. And that's how I tend to operate. Is this so be very specific about decisions I want to make and decisions That you can make on your own. And I try to again I'm not perfect, so sometimes I would veer into a decision that that they should be making. but I am over the years I've become more and more deliberate about, okay, I'm gonna intervene here because of this reason. And I expect you to like make the decision, but the reason I'm intervening is because A, B, and C happened, so I need to like get involved.
Keith Cowing: Right. You're explaining your reasoning, which actually goes a long way. Because if you don't,
Mahesh: That's right.
Keith Cowing: people come up with their own stories. And their own stories are always worse than reality.
Mahesh: Hundred percent. Hundred percent. Hundred percent.
Keith Cowing: so if you if you expand that to not just your team, but the whole, let's say, executive team.
Mahesh: Mm-hmm.
Keith Cowing: let's take a a tough one. For example, pricing. A lot of people struggle
Mahesh: Mm-hmm.
Keith Cowing: with who owns pricing. At Kojabi, who makes the decision about pricing? How'd you figure that out?
Mahesh: Well, I think for something like any one-way door, I would say is usually the CEO's decision in the end. Because this is where I've gone through different iterations of it in different companies. You would make a we hire a pricing director and make that person responsible for figuring out pricing, what would end up happening is you'll go to the CEO, the CEO will veto it, and then you go back again to the drawing board and figure out like another new set of like, you know, pricing structures. but for Kajabi it's a one way door, so that one way doors is CEO's decision is the way I look at it. and obviously, you know, it's even if you disagree with the pricing, it doesn't mean you grumble about it, right? It's a disagree and commit moment. So, okay, we're gonna
Keith Cowing: Mm-hmm.
Mahesh: hold fast to this pricing change and we're gonna be ready for whatever You know, whatever issues customers bring to us saying your pricing is too high, etc. And Kajabi went through a pricing change just before I joined, and they did it really well. Because they said, Here are the reasons why the price is changing, here's some new stuff to justify the pricing change, and you have six months. So the pricing change doesn't kick in until like six months after this announcement. And the team did a great job of sort of getting people warmed up to the pricing change. We had we saw some churn, but put nothing nothing what we expected you know like a year ago. So for something like pricing I would say it's the CEO's decision. And you should just make it clear that it's this person's decision.
Keith Cowing: And I actually think that gets away from some of the friction that gets caused where I've
Mahesh: Yeah.
Keith Cowing: seen marketing own it, I've seen the revenue team own it, I've seen product own it. But
Mahesh: Mm-hmm.
Keith Cowing: it's such a cross-cutting thing that impacts literally everybody that it is a part of your product strategy or go to market strategy. It's it's high-level company strategy. And so if anybody owns it, then somebody else ends up having some issue with it or friction that they didn't make it, et cetera. It can cause a lot of toxicity on the team,
Mahesh: Hundred percent.
Keith Cowing: actually, if you give it to somebody else. And so just putting it on the CEO and your point about hey, as CEO, I am taking responsibility for this decision, so it's my risk. Like it's on
Mahesh: Yeah. That's right.
Keith Cowing: me, then it kind of like takes it off everybody else. It's I think that's simplifying in a way.
Mahesh: That's right, that's right. And I wish more CEOs would do that explicitly, that, hey, this decision is mine, so in the end I'll be the decision maker in this. And a lot of CEOs struggle with that because they obviously they don't want to come off and come off as this dictator who makes all the decisions, right? So
Keith Cowing: Right.
Mahesh: But if it is I've encountered this in like other companies where this was a new product line we want to build, and I thought it was my decision. So but then it became my boss's decision, and then it became the boss's boss's decision. So if you just told me that in the end the CEO make the decision on this, I would have been like, Great, like here are your options. You pick what you want to do.
Keith Cowing: Right. And on the decision making front with AI, in the
Mahesh: Mm-hmm.
Keith Cowing: past A lot of tools have been functionally specific. You know, the sales team uses Salesforce and engineering
Mahesh: That's right.
Keith Cowing: team uses Jira or whatever their trackers are and all those other tools. Product team has their tools, marketing team has their tools. And with AI, some of the most powerful things that you can do as a company are only true if you make centralized decisions that everybody can live on top of from a data perspective,
Mahesh: That's right.
Keith Cowing: which is hard and tricky, but it has to be a centralized decision. It within Kajabi, who's helping make those calls that have to be centralized so you can make the most out of AI.
Mahesh: in so the way we have done it and we've seen a lot of success is so we basically MCP our way into all these data repositories. So
Keith Cowing: Mm-hmm.
Mahesh: we use linear for product development, we use a HubSpot for go to market like outbound and then we have a bunch of data in marketing land with Meta dashboards
Keith Cowing: Mm-hmm.
Mahesh: Google Analytics etc and we have pulled all of it into one place in our BI infrastructure and then we use MCP to sort of query all that and what my CEO has done is he has created his own kind of layer on top of all this data. So for example, he has guidelines on, you know, marketing should be able to do A, B, and C, and here are your goals. So for example, if you're running a promo, I can go inspect that layer and find out how is the promo going, what what are the what are the things that are working, what are not working, decisions we may need to make and change, et cetera. So that is one unified layer that we have, credit goes to the CEO who did this, or Kenny. but then when we make decisions that are cross-cutting, it's almost always like a group decision, but the source of data we look at is one place because everything is pulled into this one sort of operating system for the executive team.
Keith Cowing: That's awesome. last question. So you're building outside the bubble. You're not
Mahesh: Yeah.
Keith Cowing: in Silicon Valley. You're not in New York. You're not even in LA. You're in Orange County. And when
Mahesh: That's right.
Keith Cowing: you think about local talent and you know, you're interviewing where maybe they don't have the same types of resumes or backgrounds or titles that other folks have had because they were brought up in those bubbles and still live in
Mahesh: Mm-hmm.
Keith Cowing: those bubbles. How do you test for whether somebody's gonna be a good, you know, team member and and what does that look like for where you are in the world?
Mahesh: in the world of AI, your Live coding tests don't mean much anymore, right? So we we don't do those anymore. what we do these days is we we do a like a hiring manager screen just to see if you can work with this person, have somebody from your team talk to the person to see if they want to work with this person, and then invite them over for a week and have them spend time with the team. We pay them, like you know, here's here's like a few thousand dollars for your week, and then you just work side by side with the team. and see if mutually do you want to work with each other longer term. And all the new hires that we have done locally is the that's the approach we have taken. and again the why I look at Kajabi and it's like the at least the engineering team is like an MC Escher painting that shouldn't work, but somehow it works. and I think it's the reason is because the engineers, the product managers all come from diverse backgrounds. They don't they don't they didn't all go to the same school, they didn't all work at the same companies, some of them have music backgrounds, some of them some of them were teachers, some of them a lot of them are self-taught. And these folks, I really like working with them because they think differently. They're not bound by whatever Google has taught them or whatever Amazon has taught them. and they will make these creative choices in designing stuff. It's like, this is very cool. Like it it's Silicon Valley person wouldn't have thought of building stuff like this. And and that ethos was set very early on in during the inception of the company, and so that culture has sort of prevailed. So whoever we end up hiring locally or otherwise, we want that person to fit in with this MC Esther-esque painting sort of vibe. I know like Amazon, I think Jeff said this, is don't hire for social cohesion. And I think that's I don't agree with that. Like if you don't have social cohesion in your team and you're constantly fighting with each other in sort of getting stuff done, then that's a problem. So I think obviously like you don't want to introduce a bunch of groupthink into your mix, but there has to be a level of social cohesion that needs to exist in the team for people to be able to work with each other.
Keith Cowing: So you've totally simplified the whole hiring down to do we want to spend time together? And then can you do the job? And you just literally test it by spending time together and then having them do the job. And yeah.
Mahesh: That's right. That's right. That's right. That's right. Cause we yeah, we we got rid of all the coding exercises because it's like any everybody can just you know, should everybody should be using some AI tool to like do the work, right? So
Keith Cowing: Right.
Mahesh: it's more do you have the right business judgment? Can you do pair programming together? Can you like hang out with the team? Becomes that.
Keith Cowing: Mahesh this was awesome. And you know, we talked about being a single-threaded leader and how do you make decisions quickly in this high velocity environment environment? How do you make sure that you're self-aware about where your subject matter expertise is and where it isn't and make sure you have healthy tension in the room? How do you figure out who owns what and take on risk yourself so that your team feels empowered if people do these things well. they can really have an exciting time in this AI driven world, which is super fast and slightly scary, but it can be really exciting if you get everybody on the same page and you have that winning spirit of let's be competitive, let's go win. So
Mahesh: I represent. I represent.
Keith Cowing: I think is both tactical and helpful and and also inspiring for people. So thank you so much for joining me.
Mahesh: thanks for having me.
Mahesh: I think the the single biggest reason is it makes the the pace at which decisions can be made like really, really high. So that's the number one reason why I like the single threaded executive model is Just your decision making velocity is orders of magnitude better than what it would be if there was a CTO and a CPO and they had a customer support, et cetera. So that's one aspect. And I've been this model of operating ever since I first encountered it at Amazon has always like stuck with me. I was like, this is a phenomenal way of creating teams and and like putting leaders on top of teams where it's one person making all the decisions, right or wrong, and you're responsible for executing on your vision. Responsible for setting the vision and responsible for the outcomes, like good or bad. And I think the like five years ago, building expertise in a different domain was much, much harder than what it is right now. I was determined to be the single threaded leader when I was at Amazon. So that was sort of my MO going into every new role. So I chased it with every new role that I took after Amazon. And in the beginning, it was it was it was hard because you have to understand what a product manager does. Does what a customer support person does. And to me, it was fun, like learning new disciplines. And that is sort of connected to the second part of your question: what is the drawbacks? So in the early days, I would optimize for what is closest to me and what I understand the best. So if I take, if I think back to Smartsheet, sometimes my decisions were like look through the lens of engineering. So I would focus in on the details of an engineering problem because I was Familiar with it and let the product decisions be made by another person where I wouldn't get involved in the details. And and my engineering team told me that you need to like back off because you're like interfering in like the day-to-day decision making. And the product team was like, you need to get involved more here because we want your involvement in these decisions. So that is a trade-off. And over the years I have become more and more self-aware of what I'm good at and what I'm not good at, and what I'm not good at. I'm like Really self aware of it and I hire for my blind spots. But that is a risk, right? So appointing a product leader as a CPTO or engineering leader as a CPTO is the risk is you might not be self aware. The leader might not be self aware that they have a gap there. And and then try to apply what they know as solutions to every problem, which is which is not how it works. but going back to the first part of your question, with AI, the the pieces that I learned about how product works, which took me s a year to understand this is how research functions, this is how product decisions get made, this is how you get the product market fit, this is how product marketing works, that all you can understand it in like less than a day. Not saying you're gonna get good at it, but you can understand the basics of these are the steps you need to go through. And I would argue that anybody who has sat in any leadership seat for an extended period of time probably has the mental capacity to understand another Domain and another like function. It's just the market has told us for the longest time that, well, we know we don't want like the one person making the decision. We like the tension between a CPO and a CTO, and that's where the right decisions get made. But AI has appended all of it. It has completely flipped it on its head. And the things that I've been saying for the last five years, now everybody's saying it. When I used to say at Smartsheet that hey, it's better to have a single-threaded leader, this was I didn't. have a bunch of like a lot of fans. Like my boss was a fan because he was from Amazon. So he's seen the model work. So he was like, yeah, okay, yeah, I understand why it would work here. But a lot of people are like, this is not gonna work. And now it is somewhat becoming the trend even in in like mainstream technology companies.
Keith Cowing: So you mentioned the tension between Ahead of product and ahead of engineering, being able
Mahesh: Mm-hmm.
Keith Cowing: to make better decisions that way. And there's whether or not there's tension, healthy tension, and then there's
Mahesh: Mm-hmm.
Keith Cowing: whether or not you have a single person making a decision, which do not have to be one and the same thing. So you can have a lot of healthy
Mahesh: Right.
Keith Cowing: tension, but then have somebody who's a tiebreaker just says, Let's go. This is what I'm going to decide to do, but I've heard it all. How do you make sure as a single-threaded leader that you get the healthy tension to increase the quality of your decision making, even though you're going to maintain the velocity and people don't have veto power?
Mahesh: I think it comes down to leadership style. So what I tell my team is The way I challenge you on your decisions, you can challenge me on my decisions too. So I can tell you, I might tell you that I listen, I hear you, but we're gonna go this way, and that's a risk I'm willing to take. But you should challenge me if you think I'm making a decision that is incorrect. And again, you're not gonna people aren't gonna do it on day one, but if you reinforce it, you know, meeting after meeting after meeting, and one of my favorite meetings that I run, I still run, is the business review. So we start with what we want to achieve. As a North Star, initiatives that are gonna get us to the North Star, and the metrics that show success that we're heading in the right direction. And in those meetings, I say, I'm gonna challenge you on this, but you should challenge me on my decisions And if it is not something that I that I'm gonna like agree, then I'll Hey, we're gonna make a choice here, we're gonna move on, and that you just gotta get used to it. And if you don't set that expectation, then you'll become you'll be surrounded by yes men or yes people. and then you'll end up making the wrong decision, basically.
Keith Cowing: Let's dig on that a little bit. So within Kajabi, do you run those business reviews by product area or is it one for the whole company? And then who's the one presenting in that forum?
Mahesh: I run the business review every week and the way I I've done it differently in different companies depending on what the need is. So generally at a high level, it is every product area gets its own section. You talk about how your metrics are doing, the success KPIs, what is going well, what is not going well, what are the risks, and where do you need leadership help from? Or every single week.
Keith Cowing: And you run this every single week. What day of the week do you run it?
Mahesh: so it started in at Amazon. I always do it on Wednesdays. Because that is in the middle of the week, it's not the beginning of the week. So some people will do the homework the week before, but a lot of people will do it on Monday, Tuesday, so you get to Wednesday, and then you're ready to go. and that's when we decide whether we have the course correct, whether we are that these metrics are the right metrics, whether things are moving in the right direction, what do what do people need my help with? That's the forum where we discuss all of this. For Kajabi, we have I have modified a little bit because there are parts of the business that are fairly stable. And I don't want to drag them to a weekly meeting looking at metrics that aren't gonna aren't gonna move every week. So we really for for Kajabi are really focused on there like four or five key product launches that we have done in the last four months. And I want to make sure they hit product market fit. So that's my entire focus. So we're gonna talk about those metrics. How many people are adopting it? What are their what is their feedback? What is the engagement look like? Are these these input metrics are they affecting the output metrics of the company? Revenue, churn, retention, GMV, et cetera. And we talk about that every week. Now, at some point we might go, these things have hit product market fit, or we've decided that they're not gonna hit product market fit, we're gonna scrap it and move in a different direction, and we're gonna go back to like two weeks or once a month or something like that. But to start with, we're doing weekly just so that we can get in the rhythm of talking about these things regularly.
Keith Cowing: That's a serious cadence. A lot of people do this monthly or quarterly, weekly is hey, every single week we need to have our eyes on the prize and be focused.
Mahesh: Yeah, th that's right. Because especially for the new launches we did, they're not they haven't hit product market fit yet. So I don't wanna wait for a month and go, well, we had these problems and I didn't know about it, then yeah, it's not a not a good position to be in.
Keith Cowing: And then tactically, do you take the outputs of that and feed it into markdown files or some repository that AI can access? How do you use all of the great conversation there that's amazing context for AI and
Mahesh: Yeah.
Keith Cowing: leverage it in the future?
Mahesh: all of the weekly business reviews are tabs in a document until it becomes too unwieldy and you have to like roll over to a new document.
Keith Cowing: Mm-hmm.
Mahesh: And that's in the same drive all the time. So if people want to point their Claude to that directory and like read it, more more power to them
Keith Cowing: It's all there across the whole company.
Mahesh: Exactly. And then when we get to board meeting time, I just point my Claude at that directory, sort of pull out what has happened in the last three months, and here's a good, here's a bad, here's the here's the mid mediocre and then give that to the CEO and then who goes sort of figures out like what to what to present to the board. These are Google Docs, yeah. Yeah.
Keith Cowing: Yeah. And these are Google Docs to be specific? Okay. And then what about the transcript? Do you record these sessions? Do you save the transcript and the tension and the discussion?
Mahesh: We we do. we use granola for for all the transcripts
Keith Cowing: Okay.
Mahesh: and some people some people look at the transcripts, but I prefer just going back to the doc itself because I look at the comment and I'll remember that was a conversation in that moment. But but we all of our meetings are recorded on Granola and it's available to everybody who wants to to to take a look at it.
Keith Cowing: So all your meetings at Kajabi by default are recorded and shared.
Mahesh: it's the option to record it is given. All the major meetings are recorded. So if it's a
Keith Cowing: Okay.
Mahesh: review, it's recorded, like all these meetings are recorded. Yeah. All hands.
Keith Cowing: And when when did you make that a clear policy? Was that recently with AI? Had you always been doing that? I see a lot of people struggling with this specific decision of how do we clarify what we're recording, what what we don't, what's private that you record and keep, what's shared, et cetera. And and being really clear is super important.
Mahesh: we've been doing it for a while, and all the big meetings are by default, everybody just pushes the record button because somebody's gonna ask about some context which was discussed in a meeting like a few weeks ago.
Keith Cowing: Mm-hmm.
Mahesh: So it's by default everything is recorded. One-on-one conversations pro probably not. I mean people I mean some managers do record it for future reference etc., but the large meetings always recorded
Keith Cowing: And the managers, do they ask for permission when they record it or they just talk about it ahead of time? These are the conversations people are learning to have right now because it's so such an important thing that's popped up.
Mahesh: nobody asked for permission anymore. It was
Keith Cowing: Okay.
Mahesh: it was a thing maybe a year ago where people like hey we're gonna record it, everybody comfortable with it, not anymore. It's a d it's a default behavior at this point.
Keith Cowing: And I I see that in a lot of places. And then if obviously if you're having a sensitive conversation, you want to not record it, you can say that. But if you know that by default expect it to be recorded, then people behave accordingly. And in some cases,
Mahesh: That's right.
Keith Cowing: you know what, behavior improves a little bit.
Mahesh: That's right, that's right. The other thing I tend to do, and even my boss does it, is if we are in a everybody's in a physical room, we use like a note like a physical note taker. So there are no screens, nothing, and we just want to have a live conversation, we would use like Plaud like note taker or something like that, and hit the record button and then feed that back into whatever you want to store the transcripts. We do that too.
Keith Cowing: Awesome. And so so this is a new way of operating. You have a single threaded leader. You're recording everything. You have all this context, weekly cadence, which is amazing. I love that. now let's talk about change management. So there's
Mahesh: Mm-hmm.
Keith Cowing: people that have all these things in place. And there's people that see where they want to go, but they're not there yet. Maybe they have a CPO and a CTO and they're the CEO's
Mahesh: Mm-hmm.
Keith Cowing: sitting there thinking, do I really want both of these people? Do I want one leader? We're not recording everything. We have to change our, you know, our default.
Mahesh: And yeah.
Keith Cowing: And you don't have to, but there's so much context less left on the table from a AI perspective, if you're not recording things, it's a huge trade
Mahesh: Yeah.
Keith Cowing: off now. And so if you're in the old model, you're trying to get to the new model. you're dealing with people's jobs and livelihoods. your recommendation for how people have these conversations around the leadership table to take
Mahesh: Mm-hmm.
Keith Cowing: on things that are very touchy? If if you have a CPO and a CTO, I see a lot of executive teams where people are elbowing out a little bit to try to mark off their turf because they're afraid, you know, an eight person exec team might turn into
Mahesh: Mm.
Keith Cowing: a six person exec team and they're not sure if they're gonna be one of the ones left in the seat. So it creates a natural tension and it creates
Mahesh: Mm-hmm.
Keith Cowing: an awkwardness. How do you handle those conversations to be open and transparent, but also realize that you know
Mahesh: so maybe this is controversial. I don't think any executive will sacrifice their own turf on their own terms to say, hey, I think for the benefit of the company, I should step away and you should give my domain to somebody else. I have never
Keith Cowing: Yeah. So assume people are self preserving as a as a principle. Yeah.
Mahesh: Yeah, I think people always will be like self preserving. So if you're the CEO you have to look at how quickly are is your executive team making decisions, number one. And this is when like people get to hyperfixate on what is in front of them. The
Keith Cowing: Mm-hmm.
Mahesh: What I've learned, the best way to calibrate your team is to match it up with somebody else. So I would talk to CTOs in similar size companies or even smaller you talk to your peer in a different industry, running a different team, and ask that person, hey, how long does it take for your team to like ship something from zero to one? If they go, if they tell you a number which is orders of magnitude smaller than yours, then that's a problem. So, as a CEO, usually CEOs do a good job of cross-calibrating. They have access to the board, they have access to other CEOs in their network, and that's what you should be doing. You should cross-calibrate yourself with others and go, okay. Okay, my my executive team is much, much slower, so there is a problem. Number one. Number two is what I look for, especially when I look at like In my life, but who should I keep and who should I sort of let them go? Is who cares about the overall business overall, and not show up to a business review, talk about their part, and then just go mute, video off, and go do something else. Because as as AI kind of breaks down the boundaries between functions, I want more business leaders as opposed to an engineering leader or a product leader or a marketing leader. Because if you've been in the industry for 10, 15, 20 years and you can't explain what like CAC is for your business or what L T V for your business is or what your churn looks like or your hypothesis on why churn is up and down this week, then that's a problem, in my opinion. and CEOs should be paying attention to those things. In in like five, six years ago, it was AI was not there, like f like knowledge was hard to come by, even though it was free, like Wikipedia is free, everything is free, but then to be able to like learn from online media was like hard but now it's not hard anymore. So I would say like those are the two things. How quickly is your executive team moving? And two, is your executive team business leaders or are they functional leaders? If they're functional leaders mostly then you have a problem that you need to go fix.
Keith Cowing: There's this underlying theme in everything you're saying, which is that competitive spirit of winning, where on the
Mahesh: That's right. That's right.
Keith Cowing: surface you're saying, okay, well I love th there's a bunch in there. So one part is Looking around the structure of your team and not solving structure for the sake of structure, but looking at the outcomes and saying, are we winning? Are we fast enough? Because if we're not, we have to change something. And if we're fast enough, then fine, it's working. and
Mahesh: Mm-hmm. Right? That's right. That's right. That's right.
Keith Cowing: a lot of times in today's market, you're not, right? So it's you're constantly pushing. And if you're running on a track team and you don't know what the competition looks like, you might feel great. And then you go watch the, you know, the competitors are like, wow, they're beating us by five seconds in the, you know, in the sprint, and they have got these new shoes and this new tool and this that. And it's like, wow, we have to change our game because you know it's the competition. That matters, you just don't see it on a daily basis. So benchmarking is really important. I love
Mahesh: That's right. That's right.
Keith Cowing: your point about are you here to help the company be better? Not just are you here to make yourself or your function better? And that
Mahesh: That's right.
Keith Cowing: mindset is so important right now. and that owner mentality. And then you know, just ultimately coming together to win as a team. And if if you're all in,
Mahesh: Hundred percent. Hundred percent.
Keith Cowing: like that's the one thing that matters more than anything.
Mahesh: That's right, that's right. And just to like to add on to your point, the one team that suffers from this quite a bit, some teams are like wired for that mentality, right? Your marketing teams, sales teams, their product teams a lot of the times, like we wanna go win. We wanna go compete against this other thing and then we're gonna win. Engineering teams on the other hand or like it's slowly coming around to that idea of competing and winning because up until like I don't know, four or five years ago, the theme was let's build the best software, let's build the most scalable thing, let's build let's do it for the sake of the craft. And AI has completely demolished that need, right? But if you think back to, and I've been in many conversations like this, like five years ago, if I tell my engineering team, you know, we're gonna go win as an engineering leader, it's not gonna be received well. Now it is different. I think the the teams themselves are realizing it, and the leaders who don't say those words are the ones going to be left behind. So it is the so just if you know if your audiences are engineering leader, CTO, aspiring CTO, you gotta shift your mindset from I'm gonna build the best software to I'm gonna build the best company, I'm gonna build the most competitive team that's gonna go get stuff done faster and better than the competition and delight your customers and make some money along the way.
Keith Cowing: Digging into that a little bit, you're talking about mindset here
Mahesh: Mm-hmm.
Keith Cowing: and If we think about what makes a winning team, anger and fear are the two emotions that cause all the worst decisions in business
Mahesh: That's right.
Keith Cowing: and life. And right now, anger tends to, in my opinion, frequently in corporate environments come from feeling slighted by another function or another leader, another person.
Mahesh: Yeah, yeah.
Keith Cowing: And a lot of that comes down to communications and things like that. But the fear seems to be the heavier one I see right now in the environment because there's so much change, there's so much happening. If somebody's a CPTO for the first time, they may be fearful that they can't fulfill. the other shoe they haven't worn in the past or a team might be fearful they're going to get automated. There's just chaos in the world. How
Mahesh: Mm.
Keith Cowing: do you think about on your team helping reduce anger and fear so that they can have that mindset of I'm here to win and I have conviction?
Mahesh: I believe that every leader's job, one of their main jobs, is to underwrite risk. Your job is not to like pass down that to your teams. So for example, what I mean by that is I go to a team and the team go and I tell the team, hey, you I want you to do this super risky experiment. And the team goes, or the leader goes, Well, this is there's the risk that this might fail. Is this gonna affect me in my performance review, et cetera, et cetera? The right answer then is you should say, I'm gonna underwrite that risk. If that fails, that's on me. I'll go talk to whoever is above me and convince them, or take the fall for it, like whatever may be the case. But but people who push down that risk, They create this environment of fear. And I've seen this in large tech companies mostly where everybody's afraid of failing because they're gonna get dinged at in their performance reviews. But if you get really good at underwriting risk as a leader, telling people, roll the dice, I'm gonna cover your back, I'll be behind you covering for whatever failures that happen, those are the best outcomes. That's that's when the way you get the best outcomes and the best behavior from teams, because teams look at you and go, Well, your leader has got your back. So we let's go let's go let's go ahead.
Keith Cowing: Can you give me an example of that? A tangible example where you could have offset the risk and given it to your direct report but instead you took on the risk and what that actually looked like?
Mahesh: well take let's say Kajabi for example. the ad platform that we launched. We call it Kajabi Amplify. And there was like the building a marketplace, two set of marketplace and an ad platform onto a TAM that is not used to it is is inherently very risky. Right? So when we were discussing it the the product team was like, Well, we discussed this before, we don't know if it's gonna work or not. and so so I I had conviction that it's gonna work because our competitors are doing it. So so I'm like, okay, we're gonna go do this, let's get the MVP out, let's get some signal, and if it doesn't work, it doesn't work. Like, you know, I'll tell the board that it was my idea and it didn't work. We tried it and it didn't work. it and and then they're like, Okay, let's just go do it. And now it is reasonably successful on its way to getting product market fit.
Keith Cowing: And then where do you cross over towards, okay, we're betting on a few things coming true that may or may not happen. I'm taking risks for that. But also you are responsible for doing a great job. You have to execute
Mahesh: Mm-hmm.
Keith Cowing: well. How do you manage that balance?
Mahesh: personally what I ta what I try to do is divide decisions into one way doors and two way doors. So one way doors are what's that? Yeah, very Amazonian, right?
Keith Cowing: Okay. Very Amazon of you. Very Amazon of you.
Mahesh: One-way doors are you gonna like you can't like easily walk back out. Like you change the name of the company, you change the price, you change branding, you put your team on a project that's gonna take multi multiple months or multiple years. Like that's like one-way doors. And those decisions are somewhat democratic in nature, which means I get a lot of feedback, get feedback from my bosses, get peers, etc. But but the reality is most decisions in companies are two-way doors, right? Even if you want to build a new product feature, build it. Release it, see what happens. If it doesn't work, doesn't work. Like we walk back and then like move on to the next one. so if it's a two-way door decision, I just take I run with a lot of risk. So okay, it it it's fine. It's not a big deal. So that's how I decide like what to kind of roll the dice on and what to like, okay, let's be careful about changing stuff here.
Keith Cowing: And how do you articulate those to the org when you're making them? How do you share the decisions that you're making and how much rigor you're putting into it, et cetera? How do you make that clear to people?
Mahesh: So what I like doing is whenever I join a company, I do a readme form you know, describing me this is who I
Keith Cowing: Mm-hmm.
Mahesh: am, this is how I make decisions. In in that I usually like call out in terms of projects, I want to get involved in the initiation of the project, and then at the end when you try to take it to market. So I just want to be involved in these two and then in the initiation of the project, this is how I make decisions. So one-way doors, two-way doors, and there's a usually a theme f for you know for the next few months. On what your investment thesis is to be. And then, you know, if failures happen, this is what will happen, this is where I take the risk, et cetera, et cetera, et cetera. So, and then usually in WBRs, like business reviews, I reinforce that, saying, yep, this is a two-way door, not a big deal, let's just keep going. It comes to like repetition, the more you say that, the more your team understands the way you operate. and it's you equally it's super important to do that in the in the Zoom world, right? Because everybody's remote and people don't understand. how you operate. It's important to be out there talking about how you make decisions all the time.
Keith Cowing: Th there's one juxtaposition I'd love your your thoughts on where looking at the things that you've accomplished, the teams that you run, the cadence that you keep.
Mahesh: Is it? Is it?
Keith Cowing: You are fiercely competitive and you're here to win. You are also have a calm presence to you in terms of your interactions with people. And I think a lot of times people conflate having a sense of urgency in how you speak, literally just like speaking loud and aggressively, with having
Mahesh: That's right. That's right.
Keith Cowing: a sense of urgency. And you don't have that tone at all. You don't sound like you're on CNBC yelling at people, but you
Mahesh: That's
Keith Cowing: you have a a very ferocious cadence and competitive spirit. So just talk to me about that a little bit. What does being competitive mean to you and how do you what energy do you bring to the room?
Mahesh: it's funny you mentioned you mentioned that because a good friend describes me as calm but oddly ambitious. So the the way the way I think about myself in the world is you have limited time on this planet, right? So I'm forty-five something, so maybe I have like I don't know, forty more years, you know, forty forty-five more years to be on this planet. And I I constantly think about how did I as a person come into being? The confluence of events that led to me being born and being in this place and being in this seat. And the odds of that happening in my mind at least are astronomical, right? You go from stardust to somebody like me and somebody like you, and I just don't want to waste time. So I want to have I want to make a dent in my corner of the universe, however it may be, and and so I have kind of latched on to This is I'm good at tech, I'm good at building teams, I'm good at good at getting stuff done. So I'm gonna make a noticeable dent in that in that universe. And that drives a lot of how I show up and how I behave. But but again, like I don't I tried it once, it didn't work out very very well in terms of modifying the way I show up in terms of like being a type A type person, but but I I'm that's not my my demeanor. but that to your point, but that that doesn't mean I'm not competitive, right? Because every day I get older The sort of fierceness inside me becomes more and more and more because I'm like, okay, I have one less day in the corporate world in my like working life. So I you know is that it? It's
Keith Cowing: Better be worth it. It better be worth it.
Mahesh: better be worth it, right? So, which is why you know that I just don't want to I'm not even Even if I end up make making a gazillion amount of like millions of dollars of money and then I can retire, I still won't stop working because I want to like continue to like have an impact.
Keith Cowing: And in your readme as you think about this,
Mahesh: Mm-hmm.
Keith Cowing: it what are the things that drive you crazy?
Mahesh: I I absolutely hate obfuscation. I I just so it especially in documents, it's so easy to obfuscate stuff, right? We are so for example, the product launch was very good. It's like, okay, what what does that mean? Right? So means how many people used it? You know, did people what thumbs up or thumbs down on the on the little like smiley icon? Or how do you know this was good? Or morale is low. Okay, what does that mean? So I I don't like it when people consciously or subconsciously obfuscate what they're actually trying to say. Because I know that they are trying to prevent a spicy conversation in the meetings or in the written. document they would say which stuff which is sort of watered down and I'm actually the opposite. So if something's not working, I want to hear about it, I want to like know about it. Something you know is is working, then let's just talk about it. Let's figure out how to like put more gasoline on it. On Amazon they call it weasel words. So I I just absolutely dislike people using weasel words because it it kind of like the effort it takes to like pull out the actual like truth from that narrative is like harder. Like it's high. So I prefer people to be blunt and to the point and succinct and you know just be just be open about it.
Keith Cowing: Yeah, I I love the concept of weasel words because it helps you dig into, most of our customers had a, you know, problem. Like, well, hold on, what does that mean? It's like, well, sixty percent of enterprise
Mahesh: That's right. That's right.
Keith Cowing: customers that have multiple locations in multiple countries had the following bug. And 90%
Mahesh: That's right.
Keith Cowing: of SMBs were fine, and this thing happened. It's like you need to get more specific, both in terms of who you're talking about, even customer can be a weasel word if you have multiple
Mahesh: That's right.
Keith Cowing: different personas you're serving, et cetera. And so, you know,
Mahesh: Exactly.
Keith Cowing: using data, using facts, and then say, okay, now what do we think given the objective? But you have to start with a fact base. and it's hard
Mahesh: That's right. That's right. That's right. That's right.
Keith Cowing: to do that because the default is people people use weasel words because it's easier.
Mahesh: It's easier, right. And also like Weasel was also short circuit your critical thinking. So one of my it is in my README is like when you're re putting a narrative in front of me, do not use Weasel words, be precise and all that. So but to this day people still lean into it accidentally, I think, 'cause, you know, I don't think anybody's doing it maliciously, but it's just the way people write, right? And I think I think Claude and AI is making it worse.
Keith Cowing: Yeah, we have to be very careful not to outsource our judgment by accident.
Mahesh: That's right. That's right.
Keith Cowing: We should amplify ourselves, but if you outsource your judgment it's gonna get it's gonna get problematic.
Mahesh: Hundred percent.
Keith Cowing: So, one thing I'd love to hear your take on, you've talked a lot about being a single threaded leader, managing risk, and you know, taking it on yourself and somebody else is doing something to encourage them to take on risk. This combination of authority and accountability, of being able to hold people accountable, but also giving them authority to make the decisions that they need to make. A lot of times teams get those out of whack without realizing it. Where somebody's held accountable, but they can't make all the decisions that they need to make to win. It's like having a sports coach that can't decide. who to bench and who to play and then
Mahesh: Thank you.
Keith Cowing: holding them accountable for the result. And so talk to me about that combination of how do you set up your teams to have the authority but also have the accountability that goes with it. And it's both, it's not one or the other.
Mahesh: Yeah. So which is why I mean again going back to why I love single threaded models, because you can have one person
Keith Cowing: Mm-hmm.
Mahesh: you can tell them your job is to run this product line and show these like success metrics or like run towards this outcome. I try to list down the decisions I wanna make. And the decisions I'll delegate down. So if I remember right, the the latest version of this of my readme, the decisions I want to make is investment thesis on the product areas that you want to invest in, or go to market, or whatever function. So I own that thesis. And then org structure and salaries are mine. Between this like sandbox, if you want to decide the type of product you want to build, the types of features you want to build, the type of go-to-market activity you want to do, that is all yours, and we'll agree on here's the success criteria for these for these initiatives. and then if you know, and then that flows into their goals that we we talk about on a regular basis, etc. And that's how I tend to operate. Is this so be very specific about decisions I want to make and decisions That you can make on your own. And I try to again I'm not perfect, so sometimes I would veer into a decision that that they should be making. but I am over the years I've become more and more deliberate about, okay, I'm gonna intervene here because of this reason. And I expect you to like make the decision, but the reason I'm intervening is because A, B, and C happened, so I need to like get involved.
Keith Cowing: Right. You're explaining your reasoning, which actually goes a long way. Because if you don't,
Mahesh: That's right.
Keith Cowing: people come up with their own stories. And their own stories are always worse than reality.
Mahesh: Hundred percent. Hundred percent. Hundred percent.
Keith Cowing: so if you if you expand that to not just your team, but the whole, let's say, executive team.
Mahesh: Mm-hmm.
Keith Cowing: let's take a a tough one. For example, pricing. A lot of people struggle
Mahesh: Mm-hmm.
Keith Cowing: with who owns pricing. At Kojabi, who makes the decision about pricing? How'd you figure that out?
Mahesh: Well, I think for something like any one-way door, I would say is usually the CEO's decision in the end. Because this is where I've gone through different iterations of it in different companies. You would make a we hire a pricing director and make that person responsible for figuring out pricing, what would end up happening is you'll go to the CEO, the CEO will veto it, and then you go back again to the drawing board and figure out like another new set of like, you know, pricing structures. but for Kajabi it's a one way door, so that one way doors is CEO's decision is the way I look at it. and obviously, you know, it's even if you disagree with the pricing, it doesn't mean you grumble about it, right? It's a disagree and commit moment. So, okay, we're gonna
Keith Cowing: Mm-hmm.
Mahesh: hold fast to this pricing change and we're gonna be ready for whatever You know, whatever issues customers bring to us saying your pricing is too high, etc. And Kajabi went through a pricing change just before I joined, and they did it really well. Because they said, Here are the reasons why the price is changing, here's some new stuff to justify the pricing change, and you have six months. So the pricing change doesn't kick in until like six months after this announcement. And the team did a great job of sort of getting people warmed up to the pricing change. We had we saw some churn, but put nothing nothing what we expected you know like a year ago. So for something like pricing I would say it's the CEO's decision. And you should just make it clear that it's this person's decision.
Keith Cowing: And I actually think that gets away from some of the friction that gets caused where I've
Mahesh: Yeah.
Keith Cowing: seen marketing own it, I've seen the revenue team own it, I've seen product own it. But
Mahesh: Mm-hmm.
Keith Cowing: it's such a cross-cutting thing that impacts literally everybody that it is a part of your product strategy or go to market strategy. It's it's high-level company strategy. And so if anybody owns it, then somebody else ends up having some issue with it or friction that they didn't make it, et cetera. It can cause a lot of toxicity on the team,
Mahesh: Hundred percent.
Keith Cowing: actually, if you give it to somebody else. And so just putting it on the CEO and your point about hey, as CEO, I am taking responsibility for this decision, so it's my risk. Like it's on
Mahesh: Yeah. That's right.
Keith Cowing: me, then it kind of like takes it off everybody else. It's I think that's simplifying in a way.
Mahesh: That's right, that's right. And I wish more CEOs would do that explicitly, that, hey, this decision is mine, so in the end I'll be the decision maker in this. And a lot of CEOs struggle with that because they obviously they don't want to come off and come off as this dictator who makes all the decisions, right? So
Keith Cowing: Right.
Mahesh: But if it is I've encountered this in like other companies where this was a new product line we want to build, and I thought it was my decision. So but then it became my boss's decision, and then it became the boss's boss's decision. So if you just told me that in the end the CEO make the decision on this, I would have been like, Great, like here are your options. You pick what you want to do.
Keith Cowing: Right. And on the decision making front with AI, in the
Mahesh: Mm-hmm.
Keith Cowing: past A lot of tools have been functionally specific. You know, the sales team uses Salesforce and engineering
Mahesh: That's right.
Keith Cowing: team uses Jira or whatever their trackers are and all those other tools. Product team has their tools, marketing team has their tools. And with AI, some of the most powerful things that you can do as a company are only true if you make centralized decisions that everybody can live on top of from a data perspective,
Mahesh: That's right.
Keith Cowing: which is hard and tricky, but it has to be a centralized decision. It within Kajabi, who's helping make those calls that have to be centralized so you can make the most out of AI.
Mahesh: in so the way we have done it and we've seen a lot of success is so we basically MCP our way into all these data repositories. So
Keith Cowing: Mm-hmm.
Mahesh: we use linear for product development, we use a HubSpot for go to market like outbound and then we have a bunch of data in marketing land with Meta dashboards
Keith Cowing: Mm-hmm.
Mahesh: Google Analytics etc and we have pulled all of it into one place in our BI infrastructure and then we use MCP to sort of query all that and what my CEO has done is he has created his own kind of layer on top of all this data. So for example, he has guidelines on, you know, marketing should be able to do A, B, and C, and here are your goals. So for example, if you're running a promo, I can go inspect that layer and find out how is the promo going, what what are the what are the things that are working, what are not working, decisions we may need to make and change, et cetera. So that is one unified layer that we have, credit goes to the CEO who did this, or Kenny. but then when we make decisions that are cross-cutting, it's almost always like a group decision, but the source of data we look at is one place because everything is pulled into this one sort of operating system for the executive team.
Keith Cowing: That's awesome. last question. So you're building outside the bubble. You're not
Mahesh: Yeah.
Keith Cowing: in Silicon Valley. You're not in New York. You're not even in LA. You're in Orange County. And when
Mahesh: That's right.
Keith Cowing: you think about local talent and you know, you're interviewing where maybe they don't have the same types of resumes or backgrounds or titles that other folks have had because they were brought up in those bubbles and still live in
Mahesh: Mm-hmm.
Keith Cowing: those bubbles. How do you test for whether somebody's gonna be a good, you know, team member and and what does that look like for where you are in the world?
Mahesh: in the world of AI, your Live coding tests don't mean much anymore, right? So we we don't do those anymore. what we do these days is we we do a like a hiring manager screen just to see if you can work with this person, have somebody from your team talk to the person to see if they want to work with this person, and then invite them over for a week and have them spend time with the team. We pay them, like you know, here's here's like a few thousand dollars for your week, and then you just work side by side with the team. and see if mutually do you want to work with each other longer term. And all the new hires that we have done locally is the that's the approach we have taken. and again the why I look at Kajabi and it's like the at least the engineering team is like an MC Escher painting that shouldn't work, but somehow it works. and I think it's the reason is because the engineers, the product managers all come from diverse backgrounds. They don't they don't they didn't all go to the same school, they didn't all work at the same companies, some of them have music backgrounds, some of them some of them were teachers, some of them a lot of them are self-taught. And these folks, I really like working with them because they think differently. They're not bound by whatever Google has taught them or whatever Amazon has taught them. and they will make these creative choices in designing stuff. It's like, this is very cool. Like it it's Silicon Valley person wouldn't have thought of building stuff like this. And and that ethos was set very early on in during the inception of the company, and so that culture has sort of prevailed. So whoever we end up hiring locally or otherwise, we want that person to fit in with this MC Esther-esque painting sort of vibe. I know like Amazon, I think Jeff said this, is don't hire for social cohesion. And I think that's I don't agree with that. Like if you don't have social cohesion in your team and you're constantly fighting with each other in sort of getting stuff done, then that's a problem. So I think obviously like you don't want to introduce a bunch of groupthink into your mix, but there has to be a level of social cohesion that needs to exist in the team for people to be able to work with each other.
Keith Cowing: So you've totally simplified the whole hiring down to do we want to spend time together? And then can you do the job? And you just literally test it by spending time together and then having them do the job. And yeah.
Mahesh: That's right. That's right. That's right. That's right. Cause we yeah, we we got rid of all the coding exercises because it's like any everybody can just you know, should everybody should be using some AI tool to like do the work, right? So
Keith Cowing: Right.
Mahesh: it's more do you have the right business judgment? Can you do pair programming together? Can you like hang out with the team? Becomes that.
Keith Cowing: Mahesh this was awesome. And you know, we talked about being a single-threaded leader and how do you make decisions quickly in this high velocity environment environment? How do you make sure that you're self-aware about where your subject matter expertise is and where it isn't and make sure you have healthy tension in the room? How do you figure out who owns what and take on risk yourself so that your team feels empowered if people do these things well. they can really have an exciting time in this AI driven world, which is super fast and slightly scary, but it can be really exciting if you get everybody on the same page and you have that winning spirit of let's be competitive, let's go win. So
Mahesh: I represent. I represent.
Keith Cowing: I think is both tactical and helpful and and also inspiring for people. So thank you so much for joining me.
Mahesh: thanks for having me.
