Earlier this year, FLEXE Co-Founder and CEO Karl Siebrecht was interviewed on the Leaders in Supply Chain podcast, hosted by Radu Palamariu.
In the interview, Karl discusses:
- How on-demand warehousing is the AWS of logistics
- Some of the challenges and rewards of creating the on-demand warehousing category
- What greatness means at FLEXE and how it permeates throughout our mission, vision, and the people that make up FLEXE
Below is the transcript and you can listen to the full podcast here.
Radu Palamariu: Hello, and welcome to the "Leaders in Supply Chain Podcast." I am your host, Radu Palamariu, Global Supply Chain Practice head for Morgan Phillips Executive Search.
I'm very happy to have with us today, Karl Siebrecht, CEO of FLEXE. FLEXE offers on-demand warehousing through an Airbnb-like network. They currently have more than 1000 warehouses connected by a single software platform. And unlike traditional solutions, FLEXE makes warehousing available on demand and uses software to streamline the entire process.
They have raised more than $20 million to date [FLEXE has since raised a Series B], have consistently tripled in size every year, and have been named the 18th overall, fastest growing company on Deloitte's Technology Fast 500 companies.
Karl is the co-founder and CEO of FLEXE. He's a seasoned technology executive with leadership experience in both startups and large global corporations. Prior to co-founding FLEXE, he was the CEO of AdReady, a Seattle-based advertising technology company. He also is a founding board member of EnergySavvy, which is a software as a service-based solution for energy efficiency management. Previously, Karl was also president of Atlas at aQuantitative before it's $6 billion acquisition by Microsoft. And earlier in his career, he was a manager at Bain & Company in Boston, as well as a diving officer in the U.S. Navy.
Karl, thank you for joining us and a pleasure to have you.
Karl Siebrecht: Happy to be here, Radu. Thanks.
Radu: And I'd love to start, you got me really curious, with a little bit about yourself. Starting from you being a diving officer in the U.S. Navy and ending up as CEO of a technology company. Walk us a little bit through your story.
Karl: Sure, happy to do that. So you're saying that's not an intuitive path from diving officer to logistics tech startup?
Radu: Not your typical one. I've seen one or two other people but not a lot.
Karl: Right, right. So I studied economics and Russian in undergrad, and I was there on a Navy ROTC scholarship that paid for my school. I served four years in the U.S. Navy, and sought out the diving program as the way I wanted to build my career there. It was a bit of a niche. It was a highly sought-after team. So something to compete for, which is kind of part of my DNA, and also a very small team that was close-knit and had a really important mission. So I loved that stage of my career and learned a lot. Learned a lot about teamwork, learned a lot about, frankly, industrial operations, a lot of what we did was salvage and ship repair work. And along with that there was quite a bit of logistics. That was my first exposure. And then also learned a lot about leadership.
After I got out of the Navy, I went to grad school to get my MBA, and then took a job with Bain & Company. That's a great consulting firm and specialized in their private equity practice. After several years at Bain, I had a calling to come out to Seattle to work at a tech startup. A good friend of mine had started a business about 20 years ago in a very early emerging category, which was advertising and marketing technology.
So as the internet started to initially gain traction and eyeballs were migrating from more traditional forms of media to online media, there was an early disruption in advertising and an early opportunity to go build a technology company that could help translate some of the old traditional needs that were still current at the time: finding the relevant audience and building sales growth and brand by capturing that audience and delivering the right messages.
That was a need that had existed for a long time and still existed, it was just that the means to do that was changing because the audience behavior was changing—moving from offline media to online media. That was a business that I joined about 20 years ago and it was an opportunity to really innovate in a large category. And that's where I spent about 15 years of my career up into the point where we started FLEXE.
Radu: And at the same time, there's maybe some common thread because at FLEXE you're starting a new category in the logistics space, right? So maybe that's the continuity with the diving? You like to deep dive into a new segment from your U.S. Navy days, if we had a metaphor.
Karl: That's exactly right. I mean, the comparison between the business we've built in logistics and the business we built in the advertising and marketing space is actually very strong. In each case, these businesses are fundamentally technology software—business software platforms to be more explicit.
We didn't actually sell software licenses, we built software to enable a better model for purchasing services. And that's exactly what we've done with FLEXE. I was very familiar from my past deep dive in advertising technology with eCommerce and the change that was happening at the retail level. What I was also very aware of is that the backend of the retail business, the logistics part of the stack, was also going to need to go through a transformation to keep up with all the change that was happening on the front end of the retail model, i.e., eCommerce.
The founding story of FLEXE is a great one, full of serendipity. A good friend of mine had built a consumer products business specializing in home barware—martini glasses, coasters and the like. And he had built quite a successful business over the course of about 10 years. And one of the things holding him back was warehousing in terms of how he distributed and fulfilled his products. The way he put it was this: He had been running his own operation and had been leasing warehouses on a three-to-five-year term. Every time he'd signed a new lease, he'd have to try and forecast how much he was going to grow so he can figure out how much inventory he would be managing, and therefore how much space he would need.
But the way he put it was, you know, hey, he was in a high-growth business, he was seasonal. And so it was very difficult to forecast multiple years ahead. He always ended up with too much or too little capacity in terms of warehousing. And he felt like many other businesses had the same challenge.
He came to myself and my two co-founders, who are also technologists, and said, "Hey, you know, couldn't you build a marketplace-type of model like an Airbnb and build software so that other warehousing operators could manage my goods when I was short on space, and they could fill their facilities with more [inventory] and generate more income off of the fixed costs that they were already saddled with in their current business?" And that was the genesis of the idea.
Radu: It's as always, right? The best way to start something is by addressing a very clear pain in the market. So, I have this question and I think a couple of our listeners were wondering maybe you can give us some examples of how you currently [do this]... So, this was one of your friends. You have quite a large network. So what are some of the large-scale clients that you have? And how are you currently helping them with this challenge of seasonality or lack of space issue?
Karl: Yep, sure. So maybe I'll preface that just with a with a very brief, hopefully, plain English language way to describe what our model is just so we're all clear on that. FLEXE effectively created the on-demand warehousing and fulfillment category. That's the name we gave it a few years ago. So what this means is we provide warehousing and fulfillment services to large enterprises and also to high-growth eCommerce companies. And we do this through a network of more than 1,000 warehouse operators, who are all connected to the same software platform. So very specifically, the services we provide to our clients are eCommerce pick-and-pack fulfillment, retail fulfillment to replenish to brick-and-mortar stores or marketplaces, and bulk distribution of inventory, so think from maybe a port to a regional distribution center, etc.
And the types of customers we serve specifically are large retailers like Walmart or Walgreens, large CPG companies, like Procter & Gamble, and then high-growth eCommerce companies from LimeBike to some of the mattress companies like a Casper in the States, even consumer products companies like hims, which is building a great business in the men's health category.
Radu: Got it. And a thought that comes to my mind, how do you see the distribution in the future in between on-demand warehousing, and at the same time, you have the classic, let's say, model where a client and let's take the example of Procter & Gamble, right or something like that, the consumer goods company, longer term contracts and then you have the traditional 3PL players which tend to operate on that model? Where do you see this kind of distribution? Because obviously, there are certain things that warehouses will not be on-demand everywhere and all the time. And at the same time, you've created this category that is growing. So how do you see, is it like, I don't know, 90%/10%, 80%/20%? Or I think you mentioned that the number of 70%/30% kind of split between, let's say, Procter & Gamble will do 70% stable, long-term contracts and maybe 30% on-demand. Is that still where you see it and what's the reason behind?
Karl: Right. Yes, we do believe that on-demand warehousing or flexible warehousing will be a compliment to the existing kind of fixed infrastructure and traditional solutions that are prevalent today. We don't think those are going away. A metaphor I like to use that can be helpful is when Amazon's AWS, Amazon Web Services, first launched into the marketplace about 12 years ago, what existed prior to that and did the same job was a data center. And companies would either build these data centers and staff them up with their own employees and buy the servers and buy the backup generator, power generators, etc. So they would be first-party run data centers, or they would outsource that to a third party who would lease the space, buy the equipment, hire the employees to take care of the servers, etc.
And then they would contract those services back to their customers. But those contracts typically had term limits to them and fixed costs because the provider was covering a lot of fixed costs, right? And that solution worked quite well. But one of the things that lacked was flexibility. So if you are a startup and you build a website and you forecast that your traffic would increase a bunch, you would have to guess at how much server capacity you would need to handle all of the volume of visitors to your website. And very similar to that is the dynamic with warehouses, where if you have high predictability that can close-to-guarantee high utilization, a fixed-term contract can be a great solution.
But if there's something dynamic about the need, whether it's high growth or uncertainty around a forecast or changing product mix or seasonality, it makes those fixed investments not very productive or at least not very capital-efficient. And so again, going back to the data center analogy, when AWS launched, they basically were able to replace that high-fixed cost capital investment with a service. And that service was available on a pay as you go or, i.e., on-demand basis and they were able to offer effectively infinite scale. As much bandwidth as you might need, [they] can provide that. As much geographic distribution of that bandwidth that you need, i.e., data centers, East Coast, West Coast, Europe, North, South, etc., they can provide all that on demand, and again, in a purely unitary cost basis.
And so when you fast forward to today and you look at that cloud-based IT infrastructure category, that's now about a quarter of all the IT infrastructure. And of course, Google has come out with Google Cloud, which is great. Microsoft has Microsoft Azure, which is great. And there are other competitors as well. And it is now part of the fabric of IT infrastructure. And the usage comparatively by company, i.e., how much flexible capacity do they use versus fixed capacity really varies depending on the nature and the needs of that company. A startup may be about 100% cloud-based like we are or like probably most startups are, we will never need to build a data center. Even very, very large companies like Netflix, who can certainly afford to build their own data centers chooses to use cloud because their volume is highly variable and their growth trajectory has been very high.
And then in contrast, take a company like a big bank, say Capital One, they are one of the AWS's marquee reference clients. And of course, they have data centers but they also are a large customer of AWS and their usage of AWS keeps going up over time as the needs of their business continue to evolve. But they also go up over time because AWS's capabilities keep advancing in terms of the sophistication of their data security, and other sort of add-on applications or services that they're able to provide. So that's a bit of a long-winded explanation, but I think it's important to understand that metaphor because we see warehousing playing out the same way.
And I would next just quickly point to transportation. The other big category in logistics. If you think about that business, there are companies that own their own assets, there are companies that have long-term, multi-year contractual agreements with asset providers—long contracts, if you will. And then there are a whole host of truck brokerages that offer capacity in more of a spot market or on-demand basis. Different companies choose to allocate spend across those different capabilities, depending on the needs of their business.
Radu: Excellent example, Karl. And I think it really brings the point to life and it makes a lot of sense. So basically, another way to put it, FLEXE is a warehouse-as-a-service type of model. Maybe you'll go into trucking as a service type of a model as well. I know that there's a couple of companies that are doing that, to kind of link it to your analogy also on the transportation and trucking side. There's a few platforms trying to do that. Actually, there's a very large one in China that is incredibly valuable. I think now they've reached a valuation of $1 billion plus. It's just that it's still highly under the radar, but they're doing exactly that, trucking-as-a-service and they have I-don't-know-how-many thousands and thousands of trucks already on their platform. So for sure, another category that is growing.
And I'd love to build a little bit on some of the questions, how does it practically work? So this warehouse-as-a-service, you have the technology, you have the platform, FLEXE is there. But in terms of the practical nature of, you know, who is accountable for meeting the standard operating procedures, dwell time, loading windows? Who is liable in terms of handling storage in the warehouse? Is it the warehouse owner? Is it FLEXE? How does that work? How do all these things work?
Karl: So at the very operational level of our model, the warehouse operators are responsible for and liable for the same things that they are if FLEXE is not part of the equation. We understand our customers' needs, the customers that come to FLEXE, their needs and requirements are captured in a scope of work. And we help curate a match to the right warehousing operator or operators. Many of our clients work with multiple providers through FLEXE. And part of the value we bring is not just curating the right match across all of these different providers, but once the different partners are selected, we provide a centralized way to manage your operations across this distributed network of providers.
This goes back to the software platform, but very specifically, orders or your inventory flows into the FLEXE system, whether that's through an API connection or an EDI connection. Item master inventory, everything is part of the FLEXE system, which is connected to our customers' software platforms and systems. And then the order management and inventory management is executed through FLEXE out to all the different warehouse providers.
So on the warehouse-side of our services marketplace, our providers use the FLEXE software as their WMS. And that's what enables our customers to have that single point of control and single view of all their inventory and activity. On the mechanical side, our customers' needs are captured in an SLA, which is very similar or identical to an SLA that they would have with any particular provider. And so at the point of contract, just to be very discreet, you know, the SLA is agreed to by the warehousing partners, by the customer, and then also elements of that SLA that FLEXE signs up for, because all this activity is writing on top of their software.
And then the final part of that is we act and behave as an extension of our clients' operations team. In fact, you know, I love getting feedback from customers, sometimes it's constructive feedback and we jump on it because my view is feedback is a gift, and we can always learn. And then oftentimes, thankfully, we get compliments back from our customers. And my favorite one of all is when a customer will say, "I view the FLEXE team as an extension of my team." That's how we operate and we believe that we can add a lot of value to help a client—through almost a control tower mechanism—manage this bigger and more distributed network that they can create through our model.
Radu: And it's interesting that you mentioned that you act as if you were WMS system centralized and basically you offer that visibility and all the other elements that come with it to the clients because that was a common question that people were asking. You know, "Do you also offer the WMS?" But actually, you are kind of a WMS in itself. So that's good to know. There's good to make that clear. And there was another specific question that raised a lot of interest, which was, it's kind of like also with Airbnb, how do you audit the physical conditions of the warehouse, right? Because you want to make sure that the warehouse is in a good condition? How do you do that currently, practically?
Karl: Absolutely. Yes, this happens in stages or phases with us. So the first phase is at the very beginning of a potential relationship when a warehouse operator reaches out and says, "Hey, I'd like to be or I'm interested in being part of the network."
We have an initial screen or filter. And so it's a set of questions where we will understand both the physical attributes of a warehouse and also a bit about the operating history of the operator. Once companies sort of pass that screen, the next step is a conversation where our network development team will engage with that warehouse operator to get a little bit more color and a more finely tuned screening and filtering of that provider.
Those who pass through the screens are then free to list as a potential warehouse operator in our network. So those are kind of the first two phases of screening. There's a next screen that happens. And that's at the point of the first potential operational engagement with a warehouse provider. Because up until that point, they're listed, they have their physical attributes as part of our database. They are available to be potentially matched with one of our customers.
And then if there's a match that wants to happen, there's another round of screening that we will do. And depending on the nature of the engagement, the complexity of their project that could very well include an onsite visit, both by us and/or our customer. And so there's additional vetting that happened. The last kind of phase of validation here happens when we're up and operational with all of our warehouse partners.
One of the other advantages of a common software platform is that we can manage and...well, I should say, measure and manage the quality performance of every operator across all of our clients because everybody is using the same software. So key, were kind of classic warehouse quality-related metrics like order accuracy, on-time shipment. We're measuring all that for our clients.
We're measuring it relative to their SLA that we've signed up for and the warehouse operators signed up for, and can provide not only the metrics and data back to our customers, but also this control-tower view to help make sure that all the operators are hitting their targets. And where somebody may be slipping, we can inject ourselves and go in and help. We can refine the SOPs and just make sure that the customer is getting what the customer needs and working with our operators collaboratively to make that happen.
Radu: Gotcha. And there was a follow up question in terms of the true flexibility of FLEXE. And basically, because, again, you can deal with retailers, you mentioned eCommerce. Now for some of the eCommerce players, for example, it might be a smaller shop that maybe only sells that many or maybe for New Year or for Christmas, they might have more orders and they need a little bit more space and then it goes down again or for Valentine's Day since it's coming up. And the question was, how truly flexible are you in a sense of...are there some minimum commitments in terms of time, quantity, movements? Or how does that work exactly?
Karl: Sure, yeah. The typical minimum at the very, very low end would be one month. But even that is pretty rare. It all starts for us with a scope of work, which is effectively defines what the clients need. If somebody is looking for a transload for a weekend, that's not the business we're in. Again, we provide, whether it's eCommerce fulfillment, retail fulfillment/replenishment, or bulk distribution, at a practical level given the customers we're serving, the low end of a need is typically a few months, if not several months. And then at the high end, it's just continuous.
We have clients that have been with us almost since the inception of the company. And what they're doing, what in fact, most of them do is they reconfigure their network as their business needs change and grow. If they're a high-growth eCommerce player, they may start off with one warehouse because that's all they can manage to start. But then as they start to scale, they need more capacity and [their] delivery promise likely becomes much more important, if it wasn't already important at the onset. And so what that means is, to get a two-day ground delivery, you need at least a few warehouses in your network. So they may add different facilities to the network.
Then their product SKU mix might change. And when that happens, sometimes you need to have a different warehouse provider. To use a simple example, maybe your first SKUs as a small company are small and light. But then you launch products that are large and bulky and you need a different capability. You may want to add a dedicated return center. So the point is your business grows and changes and your logistics network should also grow and change. And that's really what we provide.
You know, the name FLEXE is not an accident. That was our value prop from day one. And we think of ourselves as really providing structural flexibility. What that means is, no matter how your business grows, changes, and evolves, the logistics backend of your business should also be able to evolve and change to meet the needs of your business. So that's really, that's the value prop.
Going back to this customer example, it could be a short project to start. We may start with somebody for a holiday season and then that rolls into, "Hey, I'm launching a new set of products. I need three different types of fulfillment centers to support a different SKU mix." And then from there, it rolls into, "I'd like to expand into Canada." Or it rolls into, "I'd like to cut my delivery time by another 30%, so I need to extend my network." That's how they sort of configure and reconfigure their networks in a very agile way through FLEXE.
Radu: I may be oversimplifying it, but it sounds like a no-brainer that this is useful. But of course, it's like all the things, right? I could have started Facebook if only I put in the work, right? And I guess that this leads...because the way you described it, the analogy with the Amazon Web Services and the cloud and pretty much I think by now everybody or our listeners are quite clear that it makes sense.
It also gives and enables potential in your clients and the case that is what you've mentioned: It enables them to flexibly model their logistics operations, depending on their needs, which is tremendously important. It's a very significant option to have in terms of doing that and not looking to invest in warehouses and all of that, and having, truly, a network. I mean, actually, you have access to a network. If this works well, you actually have access to a network of warehouses that you can model depending on your needs and you don't have to invest any money in it. So it makes a lot of sense. It seems straightforward.
Now, the million-dollar question is what are your challenges in terms of growing and scaling? And because I can imagine like anything, and when you start the new category, there's a lot. So, you know, you have 1,000 warehouses, why don't you have 10,000? What are your main issues?
Karl: Right. Yeah, you know, very early on when we heard this idea and started doing our diligence, even before we founded the company. Part of the diligence was just go out and talk to people who were deep in the industry. These are both senior leaders from 3PL organizations, logistics leaders, supply chain leaders for big companies, medium-sized companies. And the response was very similar. It was, "Well, have you thought about this? And what about this? And what about liability? And what about quality?" These very, very important questions, and difficult challenges to solve, particularly through a marketplace model where you don't have direct control over the assets.
The questions from the listeners here reflect very much in this vein as to the questions that come from pretty much every [prospective client]. These are really important questions. If you can't have quality here, it's just fundamentally not going to work. If you can't figure out liability, if you can't figure out, you know, the software to really make all this stuff happen, it won't work. So it's very hard. But at the same time, if you can figure it out and we have put in years of hard work here both on the engineering product front and also on the business side through our field team and our operations team who all have very, very deep and extended experience in the logistics industry. If you can figure it out, you can create something that is really, really valuable. And that's what we've done.
And so what's different now than five years ago? We have wonderful clients who have trusted us enough to get started with them and now have grown and evolved to where we're a very important part of their business. And they're now references. And so when we have happy customers who are still, by the way, very discerning and they challenge us every day—and they should—but [our clients] can stand up and say, "I've used this solution. And it has worked very well. Here's the problems it solved for me." That goes a tremendously long way in proving credibility from the standpoint of being a "startup" in this very mature industry.
Ahead of everything else, that is what has started to even further accelerate our growth is that many of our prospects now have confidence that it actually works. Because they don't need to hear it from me, they hear it from our customers. And that's a very classic dynamic in any kind of innovation or new business model. We went through the same thing in my past life in advertising technology.
There's just a lot of, you know, your first reaction was, "Well, it's a great idea." And your second reaction was, "Well, does it really work?" And it takes awhile to prove that it works. And then given that there's something unique, if there is something unique and valuable about the new solution, so the need is there. Once the credibility catches up to it, that's when growth can really, really take off. And that's what we've experienced here at FLEXE. I think you mentioned we were recognized by Deloitte as the 18th-fastest growing tech company in North America. You know, that's a reflection of the uptick in usage of this new solution. I say new, it's not that new anymore, but relative to the maturity of the overall logistics industry, it is new. And I think that growth is proof of the fact that this is really taking off now.
Radu: And based on what you're saying it led me to think about the Airbnb story as well, where they had some incidents at the beginning or when they kind of launched it seemed to be going okay, then they had a couple of houses burned by the...or I think there was some major public scandals because one house was...one of the rented places was really burnt or damaged badly by the person who rented it because it was a fake identity. And then they had to fix the identity issue on Airbnb. And as we know today, you need to put your ID there.
And they did a lot of permutations just in terms of making sure that compliance safety and all of that is basically in place for Airbnb. So it kind of led me to understand that you are kind of going and have gone through those hoops as well, which makes a lot of sense, and it does take a bit of time. So my follow up question then would be, you know, you seem to be almost at the tipping point or hopefully at the tipping point or reaching there, when are you coming into Asia? A lot of people are asking us when are you coming to Asia?
Karl: The short answer is we don't know yet. The slightly longer answer is we believe this is a global business, we have tremendous demand from many of our customers who are global corporations as well as our warehouse operating partners, many of whom also have a global presence. And we have heard from folks from those markets who might have interest in being a partner of ours in entering those markets. So we're very bullish on the opportunity there.
You know, you'd asked earlier about growth—what are our constraints to growth? Part of the trick here is you want to obviously keep growing, but you've got to keep a governor on it. Because if you grow too quickly you run the risk of not living up to our standards from a quality perspective. You mentioned some of the Airbnb examples from that marketplace. You know, there are growing pains, and as you guessed correctly, we've had a lot of things we've learned along the way. You know, knock on wood, we haven't had any major disruptions from a service perspective. But part of that has been because we proceeded very, very carefully.
And the same goes for international expansion. We intend to do it, we just don't want to move too quickly because at the end of the day, we're still a relatively small company, albeit, growing very, very rapidly. And we don't want to extend ourselves too far at the expense of, sort of, not delivering the type of quality that we have built our brand around up until this point.
I'll share an anecdote, actually. So I don't know if you or any of the listeners have ever heard, but Facebook had a saying, which was, "Move fast and break things." And it alluded to, you know, "Just test to try stuff and if you make mistakes, fail fast and learn and keep going." Well, our version of that, we actually have posters on our wall is "Move fast and don't break things." So we want move fast...
Radu: The best of both worlds.
Karl: Exactly. We want to move fast, but not so fast, again, that we put quality at risk.
Radu: Yes. Good point. And moving a little bit on the people side of things and it's our business in terms of talent and skills and executive search and recruitment, and it's also the main challenge that a lot of MNCs (multinational corporations) have, but especially a lot of startups have. And you've come along in FLEXE and you've developed the team. But where did you find some of the most challenging, let's say, phases of your journey, right? Because at the start, you were a core team of three and then you had to grow. What have been the main challenges in terms of attracting and finding people, and getting them on board of the FLEXE story?
Karl: That's a great question. Yes, you're right. I have two co-founders, Edmond Yue and Francis Duong. They're both software engineers by trade. Earlier in their careers they had worked at Microsoft on big platforms. Edmond was one of the first to work on Azure, their cloud platform. And then they went on to found a startup together a few years before we started FLEXE. So they have this experience of working in very, very large-scaled platforms, sort of, global technology platforms. But also helping to lead, you know, they co-founded another company before FLEXE, helping to lead and grow an idea from scratch. So it's a great balance.
We were the founding team. So what have the challenges been? Part of it is you’re long on vision and short on actual results. That's just the sort of physics of the problem, right? And so from very early on we had a really deep conviction in the vision—that we could build something that would really help businesses in the world or would help them solve a key challenge around agility. You know, we can help you make your enterprise more agile so that you can compete better, ship faster, respond to customer demands more quickly, etc.
So deep passion and focus on the vision, but also the results we had to show in that first year were, "Okay, here's our very small book of clients." And the rest of it, you just have to believe. In that context, of course, you don't want to settle and hire people that you don't think are going to be future leaders in your company and people you want to work with for the next 30 years. You want to hire the best talent in the world. So you got to find the rare combination of incredibly talented people, but also people who could be convinced to stop whatever they're doing currently. And if they're really talented people, they're in very comfortable jobs because they've been very successful. So you have to win them over largely with vision and get them to join the team and help you build up the actual business that will fulfill the vision that we set out for ourselves.
That's very difficult. It takes time but my two cents on this is to never settle. It’s much better to be patient than to pull the trigger too fast on somebody who might be willing to come but may not be as likely to have all the characteristics of what you're looking for.
Radu: It's a catch 22. And again, back to the principle of, "Move fast but don't break things," that you're trying to embed in the culture of FLEXE. I think a lot of companies operate the other way: move fast and pull the trigger and then if you make a mistake, shoot the person fast. But that is not the luxury that you can afford at the beginning of the journey, right? So it's not...when you're an 1,000-people company or 10,000-people company like in Microsoft maybe it's easier but at the beginning it's a little harder. So thank you for that input. And I think it's useful for a lot of listeners who are maybe in that situation.
And final question from my side, Karl. In terms of your journey so far and you've been through from U.S. Navy to running very large businesses to now inventing and developing a new category, in itself with FLEXE and with the platform that you're building there, looking back at your career, what would be one piece of advice or sharing or story that you would want to tell the audience and what was something that really helped you that you found was very useful to know in this journey and helped you be successful?
Karl: Sure. I'd say probably the best piece of advice I've ever had is trying to surround yourself with great people. Different businesses and different people could have different definitions of what great is. For me, great is somebody who shares a similar conviction or passion for what it is we're setting out to do.
One of our core company values is passion. And what we mean by that is at the point of interviewing a candidate, this is one of the things we literally try to screen for with everybody, and you can't just ask somebody, "What are you passionate about?" Or I guess you could but that may not go all that well. So what we look for is what has the person been excited about over his or her career or even extracurriculars, if it's strictly for somebody earlier in their career, what gets them excited? What have they gone deep into?
We think that's incredibly important because building a company is hard and you will have up days and down days. To be sure that somebody can really have conviction and passion helps people pull through. The other thing about passion is it's infectious. You get people who are really excited and motivated and guess what? They attract other people who are really excited and motivated. So surround yourself with great people is about finding folks who have shown in their careers that they're passionate about something, and then in particular to this business, are very passionate about jumping on board and helping to drive towards the vision that we set out for ourselves.
Another part about great, when I think about great people, is looking for people who are great leaders, and by great leaders I mean, someone who will lead from the front, or lead by example. That means coaching people, nurturing people. That means owning the decisions you make even when they're wrong. I think it's an incredibly important quality for any organization, but particularly in a dynamic high-growth environment, that is a critical thing.
If you can surround yourself with great people and your definition of great fits the conditions of what you're trying to do and also fits the personal values that you hold, that is probably the single most important thing you can do whether you're building a company or starting a new division inside a large company or accepting a new job to run a new team or any of those scenarios.
Radu: Yes. Really good points. Thank you for sharing. Karl, it's been a pleasure. I appreciate your time. Thank you for joining us. We wish you a lot of continuous success. Keep moving fast and not breaking things at FLEXE. And we will be following your story and, hopefully, we will be welcoming you to Asia in the near future.
Karl: Thanks, Radu. I appreciate being invited on the podcast here.
Radu: Thank you for listening to our podcast. If you liked what you heard, be sure to follow us on radupalamariu.com/podcast for all the show notes, links, and extra tips covered in the interview. Make sure also to subscribe to our emailing list to get the news in the nick of time. If you're listening through a streaming platform like iTunes or Stitcher and you like what we do, please kindly review and give us five stars so we can keep the energy flowing and get more people to find out about our podcast.
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