From Kayak to Blade-runner: The Paul English exit interview
If you use Kayak’s metasearch tool for finding mini-biographies of employees (filtering by factors like “Star Wars fan” and “sarcastic sense of humor”), you’ll find English’s name has already been removed. Filling his CTO position is Giorgos Zacharia.
In 2004, English teamed up with former Orbitz consumer travel EVP Steve Hafner to create Kayak. They founded it with $17 million in funding from investment firms like Sequoia Capital and General Catalyst Partners, who got half of the company.
In 2012, Kayak IPO’ed at a $1 billion valuation.
Not bad for a company that, in its first year, lost about $6 million on about $3 million in revenue. Not bad, either, for a company that in its early years faced Expedia, Orbitz and Priceline denying it access to their inventory.
Travel startup icon
Given English’s experience, he is often sought out for his opinion on entrepreneurship.
He has hired and fired hundreds of people, and has written at length about how to hire well. His most consistent advice to startups is that at least one person on the executive team should have hiring as his or her number one priority.
Instead of the motto of salesmen in the play and movie Glengarry Glen Ross — “Always Be Closing” — his motto seems to be “Always Be Recruiting.” Surrendering to the next-best hire is a sign of an entrepreneur’s dismal lack of self-confidence, he says.
In a phone interview, Tnooz spoke with English about the kinds of startups he wants to help co-found, why he hates incubators, what’s annoying about programmers, why Booking.com is impressive, why Kayak’s meetings are different than Expedia’s meetings, and the things he most dislikes about certain young startups.
So, Blade, what is it?
Blade is a new company in Boston. We’ve raised $20 million for it so far. I haven’t disclosed the terms or investors. It will launch in April.
We will co-found 10 consumer technology companies in Boston during the next five years. We’ll average two a year. We’ll put in a half million to two million dollars each.
I’m co-founding it with two other people. Bill O’Donnell is our CTO. Paul Schwenk is our COO. It’s our fourth or fifth company we’ve worked together on, after having worked for about 10 years together at Kayak.
What’s the goal?
We are looking for companies with the ambition to build products that tens of millions will use multiple times a year.
We want to do it in Boston. Boston is not known for consumer tech. When we set up this project, I met with a bunch of top people in venture capital and tech. And a criticism I got is that you can’t make this succeed in Boston because the city has no track in creating consumer brands.
I love that challenge. I want to prove that Kayak wasn’t an anomaly. Kayak may have been headquartered in Connecticut but most of its employees are based in Boston. It’s a Boston success. And not a one-off.
Blade will get the best entrepreneurs in Boston with swing-for-the-fences ideas, and we will surround them with the services and financing and help in hiring to enable them to create great consumer brands.
I think Kayak has become a phenomenal marketing company but it started as a product company, and at core it’s a technology company. We want to create more companies like that.
Our focus will be around ecommerce and payments most likely. We’re trying to create beautiful consumer products, maybe even a hardware product. We don’t want to do any small utilities, or any B2B or enterprise or B2B2C ideas.
Isn’t the last thing the world needs is another incubator?
We’re not actually an incubator. I hate incubators.
My colleague Bill O’Donnell says incubators are places that have warm lights, they keep the chickens warm. If you visit an incubator, there’s nice coffee, soft music, people sitting with their headphones on. It looks awful, like a floor of comatose people. Not enough sense of urgency.
Will Blade accept applications from travel companies, given the Kayak background of its three founders?
Oddly enough, we’ll be biased against travel. We worked really hard for the last 10 years in travel. It’s time for a break.
Kayak is still my favorite company. I’m thrilled with the guy who took over my job.
It’s been a while since you’ve been in the weeds of building a startup. The world’s changed a lot since 2004. What makes you so confident you bring something that entrepreneurs can’t get somewhere else?
One way I have stayed in the game is over the past 10 years, I’ve been a consultant to the venture capital firms that invested in Kayak. So occasionally I’d look at new companies on behalf of General Catalyst or Sequoia Partners.
I’m also a lecturer at MIT’s Sloan School of Management, teaching entrepreneurship with Bill Aulet, who is an academic expert at how to formalize the innovation process. So in my work there I’ve been plugged in with what’s happening.
We will look to raise the founders’ sights about building a stronger team than they might otherwise. That’s rare.
Putting Blade aside for a moment, do you pay attention to startups focused on travel?
I’m really not. I feel like ‘been there done that’.
What was your proudest accomplishment in your time at Kayak?
Building the team.
If you were to sit in on a meeting at Expedia and then transport yourself to a meeting at Kayak, it would be a night-and-day difference.
At Kayak we’re really decisive. Everything’s about instant. We’re focused on doing a lot with very few people.
Now I like Expedia. It’s a great company, with great executives. I’ve met the core engineering team there.
But still. I don’t think it’s egotistical to say Kayak’s method works.
Our revenue per employee is the best in the industry. At the time of our IPO, revenue was $1.5 million per employee. We’re dramatically more efficient than not only competitors in travel but also more than competitors in most consumer-facing digital companies.
Kayak has proven to be so dramatically scalable partly because of the business model of metasearch but also partly the type of people we hired and the way we run meetings. Everything is done to be extremely fast, action-oriented. Tied to metrics.
Customers tell us what’s right, so there’s not a lot of endless debate or 20-page product specifications. We have an idea, we try it within days. We see how customers respond to it. If the idea is terrible, we throw it out. If it’s a decent idea, we refine it to make it perfect.
What lesson from Kayak are you bringing to Blade?
It’s more efficient to have equal partners at the executive level.
At Kayak, I came to trust Steve Hafner, my cofounder, completely. If I were out traveling and he was meeting with the engineering team, I trusted him to make decisions about products. And likewise, if he was out, and I was meeting with the marketing team, he trusted me to make decisions about marketing.
When I see an organizational chart and I see a manager who has two people reporting to her, I think it’s a complete waste of time. I definitely prefer flat hierarchies because I think it improves communication.
What’s one thing you hate about startups?
I hate startups where you meet the founders and ask, “Well what do you guys do?” and one guy’s like, “I’m senior vice president of strategy.” And the other one goes, “I’m the executive vice president of people excellence.”
I say this is bullshit. Just tell me, who’s running engineering? Who’s running marketing? People should have roles. It’s not that we don’t help each other. But you do want people to have clear roles.
You’ve said elsewhere that the difference between hiring a good engineer or marketer and a great engineer and marketer isn’t linear, it’s logarithmic. So hiring is a key priority. But for a startup that’s in its first year or two, it’s difficult in this high-demand market for talent to get the best employees.
Joel Cutler from General Catalyst, Steve Hafner, and myself, when we set out to create Kayak, one of the first things we said on Day One was that our top priority must be recruiting.
What would the ultimate board of directors be? The answer was to get some of the original founders of Travelocity and Expedia. Steve was an original member of Orbitz. If we can get these three guys in the room, there’s no question about travel that one of them doesn’t know the answer to. We recruited Terry Jones from Travelocity as chairman and Greg Slyngstad from Expedia.
That set the tone for the company. We’re going to create something big here.
So just hire the domain experts?
No. It’s critical that you have advisers who are domain experts. Terry Jones would give me a lot of shit in board meetings. I’d present a product idea, and he’d say, “Paul, you’re a smart guy. But we tried that at Travelocity. It failed. Don’t do it. Please just humor me and hire someone who has never worked in travel before to try to get fresh ideas.”
But actually it can be advantage to have employees who are not domain experts, per se. I actually had this odd rule at Kayak that I wouldn’t hire anyone into the engineering department if they had worked in travel before. Creative people are at their peak when they see a problem for the first time.
So, you want investors, directors or advisors who are industry leading experts. But your employees can come from various backgrounds.
If your employees don’t naturally care about the vertical your business is focused on, like an engineer at Kayak who never travels, is there a risk they won’t put in that extra 5% or 20% to really solve problems your customers care about?
To use the example of a travel company, you don’t need employees who worked in travel before or who like to travel. You need employees who want to create a company that shocks the industry by saying “Why didn’t we think about making it that simple or that fast?”
There are general principles about ease of use and speed that can be deployed in any industry and should excite an engineer or marketer even if they’re not a natural user of your product.
What travel company is most impressive to you besides Kayak?
You know there’s a famous blog post by a supposed Booking.com engineeer where he said it was an informal rule at Booking.com that if you were to re-factor your software you’d get fired.
I’m hoping that engineer was exaggerating. But there’s a lesson there.
I think Booking.com is the most killer company in travel. Kayak is my favorite. But Booking deserves credit for being viciously focused on doing whatever it will take to improve conversion rates, to do what it takes to get people a better hotel faster — to the point where site architecture becomes secondary to those priorities.
And one thing that’s annoying about programmers is this: If you ask a programmer to do something, they’ll say “That’s a good idea but how about I solve these other three problems at the same time?”
And Booking has been absolutely ruthless about making their team just solve the problem right in front of them, instead of 20 problems. That’s discipline.
There’s really sage counsel there for entrepreneurs. Just wake up in the morning and say, “Can I solve the problem right in front of me?”
You’ve talked elsewhere about how Buddhism has informed your worldview. Are the key tenets of Buddhism in conflict with what it takes to be a successful entrepreneur?
I hope not.
What I’ve taken from Buddhism — and books like The Miracle of Mindfulness by the Vietnamese Buddhist Thich Nhat Hanh — are ideas around personal responsibility and personal accountability and holding yourself to a certain standard.
Its also about managing short-term versus long-term. And not taking yourself too seriously. And taking a long-term view of the world.
A lot of entrepreneurs are hot-headed and they burn out. I’m someone who is a passionate person. I can get angry. But Thich Nhat Hanh has written extensively on anger and how you channel anger. And that’s been quite helpful to me.
What’s your advice to an entrepreneur about how to manage the deluge of advice about startups, how to manage their information intake?
The most important advice you’re going to get is not online. It’s meeting mentors locally, face-to-face.
My main advice to entrepreneurs is: find the best mentors you possibly can. Listen to them. But don’t blindly do what they say. Only execute on what resonates for you. You don’t want to build the company your mentor would run. You want to build the company that you want to run.
What I mean by that, I’ll explain with an example about public speaking. Let’s say Steve Hafner — though he was a co-founder of Kayak with me, he was a mentor to me in many ways. If I watched Steve give a talk, and at some point during this talk, maybe around slide five, he always has the audience erupting in laughter with some funny joke.
Now let’s say Steve is out sick and I have to do the presentation for him. But if slide five came up, and this was the one that had cracked the audience up when Steve presented it, but I don’t love that slide and it doesn’t speak to me or make me want to applaud, I don’t tell that story.
So the lesson here is listen to your mentors, but do your own thing.
Do you find Twitter useful?
Yes. But you have to simply limit how much comes in to your daily inbox. You can easily become overwhelmed if you follow too many people.
To use it effectively, you have to create lists. One list may be the five CEOs you follow. Another is the 10 press people. Then just look at, say, one list a day, and rotate through.
Sean O’Neill had roles as a reporter and editor-in-chief at Tnooz between July 2012 and January 2017.