Dan Storms - Being the First Product Leader at a Startup
I met Dan Storms, Chief Product Officer at The Rounds, 10 years ago at a TechStars event. It’s been a great joy to follow his career in the years since. Dan has been the first exec hire at more than one startup. I’m happy he was willing to share what he's learned. Our conversation is a great primer for any exec at an early-stage startup.
We talked about:
How he prioritizes after joining a startup
The three product leader types
His four principles for working with founder CEOs
His advice for other first exec hires
Hello, hello, hello. It's so good to see your face. I'm trying to remember the last time. I'm trying to remember the last time we saw each other in person because we met a long time ago at an event. Was it a Techstars event in New York City?
Nice to see you too. Yeah, it was in New York City, I think in 2012. It was a long time ago when I was first getting into startups. I remember you gave us some advice in my startup and it was very helpful.
I remember after that event thinking about the cool people I met and you were one of them. I've been wanting to have on the podcast since the beginning so I’m happy you’re finally here.
Yeah, I think CPOs tend to work super hard, so we don't always like to put ourselves out there. So I appreciate you creating this space.
For people who don’t know you as I do, can you share a bit about your background?
I'm a product leader based in New York City. I started as an engineer, as many of my era of product leaders started, right? That was the classic way into product management. I was working at a big bank and kept asking “Why are we building this thing? Who's it for? What is the value they're going to get?” Someone eventually told me I was doing product management. I was like, what the heck is that? So I started learning what that was. From that point on I knew I was excited about startups. I’d done some in college but when I left college it was the .com bubble. I felt like getting a job at a bank. So I moved to New York and worked at JP Morgan and also in London for three years. When I came back I knew I wanted to work in startups.
Eventually, I met somebody who I ended up partnering with. It was my first time as head of product at a startup. It was an early-stage startup and I was the first person to run engineering and product there. We got into the first class of TechStars in New York. I think that’s when you and I met.
I would frankly say that if you asked me or asked the founder. I did a terrible job at that startup.
I just knew so little and leaving the bank, I came from a very different environment. I brought value but boy, I had no clue what I was supposed to do day to day. So I went down a journey of thinking, “How do I get better at this?” I connected with some people who ran a consulting company called Originate and launched a New York office for that company. Eventually, I became head of product there. It was a great experience, especially in the context of being the first head of product.
At the time “Uber for everything” was hot. We got hired by Angie's List to launch Uber for plumbers and roofers and launched it nationwide. That was a pretty exciting effort. I got my first taste of consumer products with that and some other things I did around that time. I learned a lot but still didn’t feel like I knew everything that I should to be a great product leader. So I started poking around and got connected actually by Jon Stross, who was a co-founder of Greenhouse. He connected me to Brent Tworetzky, who was in product at the Knot at the time. So I joined the Knot. A few of us came in around the same time, it was like finishing school for product leadership. We took this business under a big transformation (it was more digital and product-centric) and grew that well. They got acquired and I had the inkling to go back to startups. I started consulting and advising some companies, refining what I think to think of as the craft of startups.
Around that time we launched the New York Product Conference. That became what we humbly call the flagship product leadership conference in New York City. We grew that to 500 - 600 people attending events. That was exciting to grow. It became more than we could do as a side project so we partnered with Industry. They’ve done a great job continuing to grow that. The tagline for that was mastering the craft of product management. That became a theme for me – trying to master the craft.
I found my way to CookUnity, where I joined the seed-funded company really early, but showed a lot of promise. I joined in March of 2020. A pandemic opportunity in a way, right? Like a lot of companies you have either terrible environments or really good environments. Meal delivery had a very good environment. We grew CookUnity from about 5 million in ARR when I joined to over 125 million in two years. So it was great growth and super intense as you might imagine with that kind of scale, particularly delivering food. I ran the digital product teams (product, design, engineering(. That was a wonderful experience.
Now I'm trying to do that again. I joined The Rounds about 10 months ago. We're a service for sustainable grocery delivery and other kinds of services like composting. Another hyper-local and mission-oriented company. I’m the first executive product leader hired.
I remember at the time (my early days in startups) thinking, I don't know how to add value today. There are thousands of things you could choose to spend your time on. It’s so hard at a startup. Every team is different. Every product is different. Every market is different. Every startup is different. So the dynamics are really difficult.
I want to follow up on something you said about feeling like you don’t know what you were doing when you got into startups. I felt the same. I think a lot of us do. It takes time to find your feet in a leadership role.
Yeah, 100%. It's really quite difficult.
I remember at the time (my early days in startups) thinking, I don't know how to add value today. There are thousands of things you could choose to spend your time on. It’s so hard at a startup. Every team is different. Every product is different. Every market is different. Every startup is different. So the dynamics are really difficult.
I started from a good place. I got a good education. I studied computer science, all this stuff that you're supposed to be doing. I still had to go through an incredible journey to figure out how to spend my days. It took way longer than I would have liked but I feel more confident now.
It is such a journey. Part of the goal for this interview series is for people to feel less lonely hearing from others who have been there.
We’re big fans of CookUnity in this house. My parents got sick and I’ve served as the medical advocate for them. It’s hours navigating bureaucracies so at the end of the day I don’t want to make another decision, even about what to eat. We’d been looking for several years for the right meal service. My husband and I have totally different diets and taste preferences. I remembered that you worked for CookUnity and we tried it out. Now we’re obsessed. It’s made a stressful time of our lives easier.
That's super cool. Thank you for sharing that story. I'm still a huge fan of the service and what they've done.
There’s a debate in the world of technology. There are all these dynamics that are amazing about software that you can replicate infinitely. There’s a pool of people who think the physical world makes everything harder and that it’s going to get wiped out by the software world. I’ve come from the other direction – I really like these physical products even though my domain is technology.
There’s something substantial about being able to take a physical thing like this The Rounds coffee jar that I’m holding in my hand and nourish people. The software makes the service possible, makes all of the dynamics that you described possible, but you're physically eating the food. What you’re talking about resonates perfectly with me. I don’t exactly have a niche, but it’s an area I’ve enjoyed investing my energy in.
The scale of the impact that you can have (as the first executive hire) is huge. You can come in, understand the landscape, apply some of your expertise, and have a massive impact.
Can you just share a little bit more about the company and what you're responsible for in your role?
The Rounds is at its core, a delivery service focused on everyday essentials. It started with toilet paper and paper towels and like really pretty boring stuff. But it was stuff that you wanted to outsource, you didn't want to think about. You didn't want to run out of it and you didn't want to have too much of it, especially if you live in a small Brooklyn apartment. Now we’re a full-fledged grocery delivery service. We bring things to your home and then take them back. The original name of the company was Milkman – like a modern-day milkman. So it's like a technology-powered milkman. I joined after the Series A when the two co-founders were starting to build up the executive team. I came on to lead product management, but because of my engineering background, I also partner with the founders to oversee engineering. I like that at this stage of company they’re bringing together a couple of teams into a cohesive digital product development team. We've grown a ton. We have four markets right now, Philly, DC, Atlanta, and Miami.
We bring you things in these reusable containers and then you give those containers back, we clean them and refill them. It’s as close to zero waste as you can get. It’s a super powerful idea. As someone who cares a lot about sustainability, the mission is super meaningful. It’s critical to be aligned on this because it gives you a reason to work as hard as you need to make a startup work.
You’ve been the first executive hire at a startup more than once. What do you enjoy about that?
The scale of the impact that you can have (as the first executive hire) is huge. You can come in, understand the landscape, apply some of your expertise, and have a massive impact.
You start to crave that. You're not yet at the point where you’re actually solving the climate crisis quite yet but we have the ability to in time. My job is to get us to the point where you have that mass impact. Especially having worked at some bigger companies, I appreciate the potential of the scale of impact.
The founders have typically gotten to this point, like call it seed or series A, through a lot of hustle. I’m not saying you need to work 24 hours but you need to show up with the same level of enthusiasm for it as they do. You have to match their energy and drive. It’s particularly important for product leadership. You show up with the same urgency they have and evangelize that into the team…at a startup, the velocity of shipping and learning and driving outcomes is really paramount. If you don't have that, someone else is coming in and ready to eat your lunch.
What's tricky about being that first exec hire at a startup? I mean like often you're taking product over from a founder or CEO, right? And you're the first exec hire. What's that like?
Yeah, that list is longer. It's hard and the first couple of times I did it, I didn't navigate it that well. So, there's a few things. There's some well-established wisdom in there, particularly for product leaders.
Usually, the founder is a visionary – sometimes they’re more company or business model visionary. Sometimes they lean more into product. Your job is to help bring their vision to life. As a founder, you want to hire someone who has excellent craft. They know the craft of building the type of product you're building well.
There are three types of product leaders. The more visionary people who can come in and give you a new vision. Usually, startups are not looking for that. Then there’s the master of the craft type of person. That’s usually the people who are the first product leader and to some extent any function like marketing, people, or COO. The third type is more of an administrator who can oversee a broad range of portfolio products. That’s not what startups are usually looking for.
I talked with some product leader friends in preparation for this. One that comes to mind is Rafael Balbi, who has been at Vimeo, Squarespace, and Maker's Row. He says, “You’re coming and the founders are expecting you to take on a lot of responsibility. You have to define what success looks like for yourself. You have to tell them what success looks like.” That’s really quite difficult but if you can take on the vision, take responsibility for it, and start shipping towards it you can make a really big difference.
The founders have typically gotten to this point, like call it seed or series A, through a lot of hustle. I’m not saying you need to work 24 hours but you need to show up with the same level of enthusiasm for it as they do. You have to match their energy and drive. It’s particularly important for product leadership. You show up with the same urgency they have and evangelize that into the team…at a startup, the velocity of shipping and learning and driving outcomes is really paramount. If you don't have that, someone else is coming in and ready to eat your lunch.
So the founders stay awake all night and you have to assume, worrying about that. You have to try to empathize with that and know that that's what they're thinking about all the time. And if you start to lapse…this happened to me once where in a 1:1 I said, “I don’t really know what I’m going to do this week.” The founder (not my current company) said basically, get the heck out of here. If you have a single week where you’re sort of acting that way, it might be the death of the company. This is too important a role. So I take that responsibility really seriously. When you own what we’re driving and assertively moving forward, you gel with the founders who have been doing that.
This is a business shift, right? They have more funding, they’re shifting. It’s important as execs that we understand that phase of business and how we help them get to the next place. It’s tricky.
Right, yeah, super tricky. You can stumble. I think where the founders can make a big difference is to create some space for things to go wrong. To say okay, what did we learn from that? Like, okay, now let's move forward quickly. You can't do it slowly, but you can make sure there is a bit of space because not everything will be perfect.
When you come in, how do you think about your early priorities?
As an aside, I strongly recommend bringing on a coach whenever you can. I did that later than I probably should have. That was something that helped me. My coach is from a product leadership company called Prodify. They've been great. They help product leaders come in and uplevel their game. They're all former executives. Mine was the CPO at Rent the Runway and at WeddingWire and worked at Marriott. She has amazing insight for me. Her name is Sarah Zalowitz. She came in and said, “You need to make a difference quickly. You need a bias for action.”
Quick wins are the most important thing to do first. Going back to a sense of urgency, it’s your job to identify some things that could make a difference. Move super fast to move them forward. Sometimes those things are already in flight. Sometimes there are things you need to spin up and reprioritize.
Then you also need to understand the product vision and the strategy. That’s typically a little bit after, but not that far. That's something I've been working on with The Rounds where we're putting together a product vision or refinement of something that loosely existed. I'm trying to craft that story of where we think we’re going to get and how we leapfrog there versus incrementally step our way. Creating something that people are bought into makes a big difference. It’s the counterbalance of being able to tactically deliver on little initiatives to move the ball forward and another mode of bringing us to a more exciting future. Having both modes is difficult.
Many execs have to do this where you’re at the 10,000-foot view and then you dive down to the 10-foot view and then back up again. Your brain explodes and you've experienced that, I'm sure. That skill is important. Everybody has different ways of creating space for that or finding mechanisms for that. Just knowing that it's important is the big thing and then finding ways to prioritize it.
As a product leader in particular, you have to understand your customers. The founders represent the company's vision and the future you want to create. Your job is to say, here’s the reality of our segment of customers that we’re particularly focused on, and here’s what will resonate with them. I think direct conversations with customers are the best way to draw that out. I’m not amazing at this but I’m trying to do two or three interviews a week. Setting a cadence so that it’s consistent so I can draw that out. Having direct insight into what resonates with your audience and articulating it makes a difference because you’re bringing something new to the conversation around the value we can offer.
A big part of your job is to take the craft of what you've learned and move really quickly to make a difference in whatever it is that you're responsible for. You can get distracted with all these little details but if you're not driving a difference, then what’s the core thing you’re doing here?
I love that. I want to go back to talk more about that CEO relationship. Let’s say the founder is the product visionary and you’re the master of the craft. How do you work with them? How do you manage that relationship as you move forward around the product?
Yeah, that's a good question. It's funny. I was thinking about this and I went into the founder CEO here, Alex Torrey, and I was like, I'm gonna go on this podcast. Is it okay if I talk about this stuff? What was interesting was that we had talked about bits of it but when I shared about how I’m thinking about it and asking, are you cool with this and are we aligned he was like, “Oh, there’s some new stuff here.”
To some extent, he didn't realize that I was doing it. I realized that I unveiled the third wall kind of thing but it was good. Our dynamic improved as a result. So thank you for that. It was a forcing function that was helpful. Preparing for the podcast codified some things.
Love it. I’m coaching from the side. (laughs)
(laughs) I had kind of thought about it but hadn't fully written it down. So I have a roadmap for the startup. I’d like it to be three years, we’re at six months right now. Things change rapidly but I like to have ideas of what will come. I do a now, soon, later type of thing. The later column can go out for another two years. There’s some really big chunky stuff in there, but it's like a roughly stack-ranked list of stuff that's coming later. This is in our board deck every quarter. It’s more granular as you get closer and closer to now. So it’s like, here’s the roadmap. Are we aligned on this?
Another thing that I got from Gijo Mathew, who’s the head of product at VTS approaches it as an allocation of resources. My job is to manage the pool of people within product development. I can say we’re going to spend 60% of our resources on this major initiative or function and people can react to that. The first thing we need to align on is the percentage of allocation. If we’re off on that then it doesn’t matter whether we’re working on this specific thing or that specific thing.
When I go to the board meetings, I talk about this too. It's like, okay, we're spending 60% of our time on growing our user base, 30% of our time on LTV, and maybe 20% of our time on profitability now that we've crossed over the threshold from very not profitable when I joined to a little bit profitable, which was quite an accomplishment. So that allocation has changed a lot and is an expression of the company strategy.
So you connect the company strategy to the allocation and then the allocations are like, okay, how are you going to drive these things that are important? People allocate in different ways. Sometimes they’re company initiatives, sometimes they’re KPIs like what I just described. I’m not overly dogmatic about this. I think what’s important to say is that we're allocating to something and everyone is aligned with that. It's a critical thing for the business.
The second category is related to that is what I've called it like founder insight. There's a set of things founders just believe they know. Some are about “just trust me.” If you do that every week you create a disempowered team because they’re following whatever your whims are.
There are many startups that are run that way – some work out and many don't. Typically if you’re going to operate that way you don’t hire someone who knows the craft of product management. Someone like me doesn’t want to work there and you don't need my experience and salary, right? So part of the value I think I bring is identifying those moments when I understand what they believe. I don’t give them all the cards but sometimes if they believe it’s really important my job is to marshall the resources to tackle it real fast. Like I said earlier about matching the energy.
But this is very rare, like once a month or every two months. If you think that that's the right thing to do, let's go. What I've observed is one out of five or six of those is the game changer for the company. So if I shut down every single one of them, we'd eliminate that possibility. If you're wrong too many times, then the company fails, right? But if you’ve succeeded and other stuff is moving forward well, then suddenly you have these leapfrog potentials.
Category three is the one-way door idea popularized by Amazon. If it’s a two-way door, let me run it. If it’s a one-way door, we should talk about it. That’s relatively clean though you should align on that as language.
The last one is really important decisions where the context and experience matter. The founder did a lot to get to that point. In my case, our founder is more of a brand-centric person, he's got branding experience. So I’ll ask him, how do you think this impacts the brand? So if it’s something significant like we don’t charge a delivery or service fee or there’s no tipping. In my case, I might say, “We’re going to increase the amount of money we take in by adding a delivery fee. That’s easy, another five bucks per order. That’s a super well-established playbook.” He responds, “No. Our brand promises we’re not doing any of that.” Even though I’ve used that tactic elsewhere and have been very successful, I can’t use it because it’s core.
Those are important decisions, whether it comes to the brand or the mission of the company bringing those to the founder to say, hey, let's make sure we review this, can be very effective.
So the list is roadmaps and plans, founder insight, one-way doors, and important decisions. Now everyone knows the set of things. There’s a lot more clarity on ways of interacting.
I love that. What advice would you offer other first-time execs?
A big part of your job is to take the craft of what you've learned and move really quickly to make a difference in whatever it is that you're responsible for. You can get distracted with all these little details but if you're not driving a difference, then what’s the core thing you’re doing here?
Some people talk about having a diversity of experiences lets you understand a range. I do think that’s true to some extent but what I’ve found is that the more I’ve specialized – I know consumer products, particularly marketplaces and subscriptions, a particular stage of company and types of decision making – applying that specialty enables me to make decisions much faster. That’s super important because your job is to come in and make a difference. If you’re learning on the job it’s much more expensive for the business.
It was a little bit of a difficult lesson for me to learn but your job is to walk in the door, deliver value and execute quite quickly. Particularly for product leaders, it's value to the customers.
If you can do that in a way that aligns with the growth of the business, then you're someone who's earned the spot there, right? Every day I’m constantly trying to re-earn my spot. That’s how I think about it. It keeps me motivated. I don’t think it's for everybody, but I really enjoy the challenge of that and being with a group that’s rallied around the same challenge.