June 24, 2014
Video: Redpoint’s Tunguz & SaaS Benchmarks
Redpoint Ventures partner and former Google Product Manager, Tomasz Tunguz specializes in benchmarking software/platform-as-a-service compan...
I had the opportunity to meet with several Heavybit member companies for office hours recently. During my sessions, two major themes came up that I wanted to detail for the larger Heavybit community: platform contributor incentives, which I covered in this post, and product management organization design which I’ll be detailing in this two-part series.
For any founder, particularly technical founders who are closer to the code than non-technical founders, hiring the first Product Manager is risky business. It’s usually prompted by the founder or engineering leader declaring
Unless there is absolutely no product experience whatsoever in the founding leadership team, it is unlikely that a VP of Product is necessary at this stage. Nonetheless, product is a role that is central to the life-blood of the company because it is responsible for so many decisions. These product decisions are foundational to the company going forward and not so easily reversed. And so, one of the trickiest parts about the first PM hire is trust with the founding team. This trust is essential to setting up your first PM hire for success. An important question to ask then, is whether the founding team is ready to have its product beliefs confronted by this hire?
Depending on your answer, there are commonly two ways to go about this hire:
Path #1: Hire a junior whose main function is to funnel data on the voice of the customer (VoC), maybe alleviate project management loads and help product marketing streamline the conversion funnel. The founder will primarily drive the product strategy here, and the junior PM is unlikely to set roadmaps, nor will he rally the troops on the product vision. But he will set up the analytics pipeline, gather VoC insights and make recommendations, collaborate with engineering on sprints, and get product out the door.
This path requires ongoing mentorship from an internal leader who has PM experience, or the mentorship services of an experienced outside PM. But, if the business direction requires little adjustment, and execution is the focus, then this path can be very beneficial with minimal disruption. This junior PM will grow over time to handle the company’s strategic needs, but this path is unlikely to fully address issues such as snowflake-product or product priorities in the near term.
Path #2: Hire a senior who will bring in her own opinions on the product strategy. On this path, the founders need to be willing to spar on the tough questions she will inevitably bring up about the business. In fact, if no arm-wrestling ensues you might not have a formidable enough partnership.
This senior is likely to have 3-8 years of experience as a PM who has ideally built product for a similar customer audience. This PM will set roadmaps and rally the troops, and she will almost certainly do it differently than the founder(s). Her arrival will disrupt the balance in the leadership team, sending the team back to the storming stage before re-emerging in the performing stage a few months down the road. It is essential that this PM has a seat at the leadership table in order to be effective. The ideas she brings in may well take the business down a different direction.
This PM requires mentorship during the ramp, but then takes the reins and runs with it, accelerating the team’s performance. While this PM can benefit any team, this path is only successful if the founding team is ready to be challenged on the product strategy. That’s because path #1 can be pursued at a lower cost, in terms of dollars and disruption, but at a higher cost of mentorship.
For any PM hire, I recommend five basic attributes: passion, smarts, judgement, communication, and empathy. I wrote about these attributes in detail in this post. The rest depends on whether path #1 or path #2 from above is being pursued. Path #1 will require an execution focused go-getter who is good with details. Path #2 will require a bigger picture thinker and problem solver, who is complimentary in personality traits to the rest of the leadership team.
There are many PM communities now where PMs hang out. Posting in those communities can be helpful. Women in Product (Slack channel), Products that Count (email list), Roadmap.com (forum), Mind the Product (event). Do you have a favorite PM community I didn’t mention here? Let me know on Twitter.
If you’re pursuing path #1 and hiring a junior, then whichever leader is currently holding the reins on Product, typically CTO or CEO.
If you’re pursuing path #2 and hiring a senior, then CEO, always. And be sure to give this person a seat at the leadership table. Keep in mind though, that as you scale and hire more PMs to take the reins, your first PM hire may stop reporting to the CEO and lose this seat at the leadership table. Anticipate this change and do what you need today to enable that transition later.
For a product with front-end and back-end, I’ve seen successful team ratios as high as 1 PM to 1 Designer to 7 Engineers. That often includes development, ops and test engineers. For a product with mostly backend, such as those with an API interface, I’ve seen ratios as high as 1 PM to 0.2 Designer to 12 Engineers. This last ratio assumes that the engineers are writing technical specifications as well.
I will explore these questions and more in my next article focused on growing your PM org from 1-5.
Do you have valuable insights and experiences in the developer tool space that you’d like to share with our community? We want to hear from you – join our contributor program today.