Stirling Olson, founder and President of Foraker Labs in Boulder, Colorado, sits down with me to discuss getting new clients, discovery workshop, growth ceilings, having a vision, and battling with the product vs service dilemma.

Stirling started Foraker Labs in New York on December 1st, 1999 with his previous employer as his first client. Foraker Labs moved out to Boulder, CO in 2004 where the company grew to 20 specializing in Ruby on Rails.

Foraker’s office is in a open work-space style with a little twist. They allow each team member to work from any station, but then they have several “themed” private rooms for when team members want to zone-in on important projects. When I say themed, what I mean is a hunting lodge, space station, and musical jam room (literally with a drumset to pound on).

Stirling and I sat down to discuss what brought Stirling and Foraker Labs to where they are today and what they have planned for the future.

Highlights

  • From CTO to Founder & President 0:40
  • Project Specs & Teams 2:26
  • Project Management 3:56
  • Technical to Soft Skills 4:49
  • Getting New Clients 5:23
  • Discovery Workshop 7:08
  • Growth & Finding Talent 10:30
  • Consensus Building 14:59
  • Have a Vision 17:21
  • Technology 19:32
  • User Testing 22:20
  • Product vs Service 24:00
  • Find Mentors 26:17

You can find more information about Stirling Olson and Foraker Labs by visiting their blog, and following them on Facebook and Twitter.

Video Transcript

BW: I’m Brent Weaver, and you’re watching uGurus, the most watched web series to become a more profitable and in-demand web professional. Today I’m in Boulder, Colorado, at Foraker labs, hanging out with their president and founder, Stirling Olson. Welcome to the program.

SO: Thank you, it’s good to be here.

BW: So, Sterling, how did you get your start with Foraker?

SO: Foraker labs I actually started back in 1999, I had outgrown my current role as CTO at a company in Newark, New jersey, and back in the late ’90s the internet heyday was in full bloom so I was both excited about all the internet work I was doing in my CTO role but also excited about the internet and its future, so I founded Foraker, had my previous employer as the initial client, and Foraker was a company of one on December 1st 1999 and grew from there.

BW: So how did you make the decision to go from a position like CTO, I assume you were probably well paid and compensated in a good position, and you basically said no, screw that, I’m gonna go do my own thing. What was the emotional process in that?

SO: I would love to tell you it was this grand vision that I had of an amazing future and change in the world, honestly I realized that I had outgrown my prior position and it was a soft landing since I had an eager initial client, so it started out of a soft landing and realized more and more this is where i wanted to be and grew it from there.

BW: So the web was a little different fifteen years ago

SO: It was

BW: What kind of projects were you guys working on then?

SO: Mostly the same, I think what’s changed the most in the almost fifteen years since then has been how we approach projects, the technologies we use, the types of folks we have on board to do those projects. More than the actual projects themselves we’ve always been interested in building custom softwares, something that isn’t out there you can’t pull off a shelf and just install on a computer, it’s something that doesn’t exist, so breaking new ground is something that’s exciting for us.

BW: And what’s a typical project look like these days?

SO: These days we do a lot of work for funded startups for existing organizations that have a new product maybe they want to build, so 3-6 month projects building something from the ground up and going from there, a lot of future work on top of that beyond that six month period.

BW: What’s a typical engagement in terms of revenue size per project look like?

SO: I’d say our sweet spot is probably the quarter million to half million dollar project. Much below that is harder for us to be really efficient on something like that, and we certainly have done things bigger than that, but.

BW: So 3-6 months, quarter million dollars, I assume each project you’re putting a team on that project to build some kind of custom app or custom web-based software?

SO: Yeah, we are organizing the teams, we’ve got four teams currently here at Foraker. A team has everybody that’s required to do the work on it so designers, front end folks, back end developers, user experience professionals, so the team takes that and runs with it.

BW: Do you dedicate teams to each of your projects or is it kind of like people float around between projects?

SO: The teams stay static over the short term, we try to rotate team members just to keep things fresh and to cross-pollinate between the teams, a team will be working on anywhere from one to six or seven projects depending on the size of our current project loads.

BW: And how do you guys currently manage your projects? Are you guys using any kind of trusted processes?

SO: Yeah, we’re loosely based on Scrum/Agile.

BW: You say “loosely”.

SO: Well I guess we’re based on Scrum/Agile, Scrum is just a framework to work within so we are absolutely Scrum/Agile, our version of Scrum/Agile is going to be different from yours or somebody elses.

BW: Anything that’s specific about what makes it different, like some things you guys have found that works for you that isn’t built into the framework?

SO: Hm, that’s a great question, I think all of our teams operate a little differently, the teams focus on those little twists that make things efficient for them, so iteration length, we are now doing one and two week iterations depending on the team. So I guess I would say what’s working best for us is letting the teams decide how to get things done in the best way possible.

BW: So you were a CTO at your previous gig, so I assume you’re kind of a technical founder. Are you still getting into the work and still developing?

SO: I wish, not as much these days as I’d like and a lot less over the past couple of years, my background is in computer science and electrical engineering, so I’m definitely a gear-head, but I’m doing less and less of that the past couple years.

BW: And what are you doing more of now?

SO: Trying to run the business, trying to find new business, try to organize and optimize the teams. Make sure that we’re producing the most awesome stuff we possibly can.

BW: So in terms of getting new business, you mentioned that you guys work with, you know, start ups or funded start ups, stuff like that. What’s kind of one of your key strategies for how you guys do get new clients?

SO: Doing awesome work. Our best source of new business has been referrals. We love it when folks leave clients that we are dealing with because they go somewhere else and they wanna bring us in to do work at their new company, so far and away the most successful new business tactic has been just doing great work and having happy clients that refer us to other folks.

BW: Speaking of great work, what’s an example of a big project you guys worked on that you’re really happy about that you can share with us?

SO: Well lots of things we can talk about, I guess the one that is probably the biggest feel-good client is breastcancer.org, been doing work with them for 14 years now. They are an online community and information source for folks affected by breast cancer, so we built a large custom CMS for them that helps them organize their 8,000+ pages of medically vetted information but also they have a very vibrant community of breast cancer survivors and spouses and other folks impacted by breast cancer. So a lot of challenges there on the user experience front, the demographic for breast cancer affected persons is often someone who is older and may have not used computers, may have what they call “chemo-brain,” taking chemotherapy, toxic things being pumped through your blood system, that can affect mental capacity over the short term, and vision and other things, so using large fonts, making sure that things are really easy to use, has been a particular challenge that’s been fun to try to solve.

BW: And in terms of, like, maybe some projects that didn’t go so well?

SO: Didn’t go so well? Well, I’m trying to think of what the best example, I mean there’s so many reasons why projects can not go so well. We try really hard to weed those out before they happen, I’m probably doing more to avoid your question than anything else. We move our clients and potential clients through a workshop process and the workshop process is geared to accomplish many things, to learn about the client, to learn the specifics of what they’re trying to accomplish. To actually break that down and give them a thumb in the wind estimate of what the work would entail, but a big part of the workshop process is actually to get a read on “Do we think we can work with you?” “Do you think you can work with us?” And if we get out of that one two five day process and we all like each other then there’s a really good chance that things will go really well.

BW: So this workshop, is that like pre-sales or pre-qualification, is that something the clients are paying for?

SO: Yeah, it is something they pay for, we charge a rate that’s sort of cutting the difference between doing it for free and charging our full rates, so it’s somewhat subsidized by the sales process I guess. We find it’s, we used to do a lot of work up front without charging, and we found that we spent a lot of time doing work for folks that weren’t as serious as we wanted them to be. So charging something is really important, but we also want to get people in the door, because frankly we do a good job of the workshop process and impressing clients with the questions we ask and helping them think through the big strategic issues both technically and also business-wise. We love getting folks in the door for workshops.

BW: So this idea of a workshop seems like something you guys developed out of maybe some pain or some projects not going so well is it something that you guys always did or is it something you actually developed?

SO: It’s relatively new, we’ve been doing workshops for about three years now, so definitely a newer part of our sales process. Definitely came out of pains of misaligned expectations, as i mentioned earlier the biggest piece is just that folks will have spent a lot of time without being that serious, whether they don’t have the money to actually do the project or some other sort of misalignment, it’s definitely helped us limit those quite a bit.

BW: And how do you guys sell that to your customers?

SO: Pretty much just the way I explained it. We want to make sure that you know what you’re getting in to. We get a lot of folks that will show up and say “Yeah we want something that’s like Facebook, a little like Google, you know, what’s it cost?” Well I have no idea.

BW: A billion dollars?

SO: Yeah, exactly. So the devil is always in the detail. Getting folks in to ask the detailed questions about what the interaction is going to be and how people are going to use the system, what the goals are for the individual users in addition to the client. Really helps to figure out what they’re talking about, whether it’s a BB, a ping pong ball, or a planet in terms of the scope of the project. I think that clients end up being very impressed by the process and realize “Oh, maybe it’s a little bit more complicated than I thought.” And that always helps to make sure that they don’t get into anything that doesn’t make sense for them.

BW: How many people are at Foraker right now?

SO: I believe we’re 19 today.

BW: Ok, so started at one person

SO: Yes.

BW: Fifteen years ago, now you’re at 19, has that just been a smooth slope to growth or has it been a little bit up and down?

SO: It was probably a slow slope early on, the first few years, we moved to Colorado from New York in 2004. We were a three person company at that point. Had pretty steady growth here in Colorado to about the 20-person size and we’ve been at about 20 people for the last four years, so hit a bit of a growth ceiling and we’re trying to figure out how to get beyond that. We want to make sure we maintain impeccable quality and customer service and communication and we’ve made some process changes over the last couple of years that I think have really helped us get ready to grow beyond that 20 person size.

BW: So in terms of hiring, or recruiting people, do you have any tips or tricks of your secret for bringing on talented individuals?

SO: That’s a great question. It’s hard work, it’s hard to find really good people. We spend a lot of time on hiring, so we believe it’s very important. We have pretty much a three round hiring process, it gets more and more involved as the rounds progress, but we hire based on three things. Personality, as the most important one, and then general intelligence as another piece and job-specific skills. We’d much rather have a person who’s going to be a great teammate and is smart than someone who is a Rails rockstar for example. Now if we get all those three things together then even better, but personality and general intelligence are the highest attributes of our hiring process that we look for.

BW: How do you evaluate personality and general intelligence? Are you guys doing IQ tests in the interviews?

SO: No, no, we kicked that idea around but not yet. Just spend a lot of time with folks, work through problems together. For technical people we do a lot of pairing, we also do a pretty involved grilling session, for other job roles we have different approaches trying to figure that out, but just spend a lot of time with folks.

BW: So when you say pairing, you mean actually doing a paired coding exercise with somebody so they’re not quite a team member yet, you’re gonna have them sit next to somebody and just code and watch them build out the code?

SO: Yeah, actually do paired programming which is a thing that’s come out of extreme programming and other Agile methodologies so yeah. Sit down, one of our developers and the technology potential hire and work through, if we can, actual client projects, we wouldn’t bill to the client for that particular piece, but work through a real-world problem instead of just some made up codecutta or some other trivial exercise just to see how are they to work with? Are they gonna be sensitive to suggestions, are they going to have good suggestions, do they just sit there and watch us do the work or are they going to be involved? Paired programming is an interesting challenge on a number of levels, both just the skill level but also somebody could have some weird personality tick that might annoy folks over time and these things tend to come out even in a couple hours of pairing.

BW: Sure. So now in terms of you mentioned kind of being in this ceiling, this 20-person ceiling space. Do you find that the growing beyond that is a people-hiring and culture problem or is it more of a revenue and client acquisition problem?

SO: In terms of what’s been limiting our growth?

BW: What’s keeping you from jumping that chasm, so to speak?

SO: Mostly it’s been a project management challenge, a pyramid of management we are pretty flat structure here at Foraker, so trying to figure out how to have more people at a relatively flat hierarchy has been a challenge, so we sort of joke as we get up into the low 20s the wheel starts to wobble a bit, so we want to make sure the wheels don’t come off and we’re not doing awesome work for our clients. We made some changes over the last six months but our biggest challenge has been finding good people to continue our growth.

BW: What practices got you to where you are today?

SO: Great question. I think the thing that I do the most is try to be inclusive and surround myself with really smart people. So I do a lot of consensus building, trying to solicit ideas from the folks that are here, I’m very much an engineering type person, so I look at the world in a certain way, our designers look at the world a different way. Trying to really allow people to feel like they can share their ideas and that I will listen to them and that we can take the best out of a handful of ideas, I think has been the most valuable thing to me in trying to grow Foraker.

BW: So you say consensus building, is that like getting all 19 people in a room and saying “Where are we heading guys? Are we going left or right or?”

SO: I’m sure it feels that way some times, In fact I know it does to me, but it certainly depends on what we’re trying to decide, and the consensus building is less around where Foraker is headed and more around how are we solving this problem, how are we improving our process? I have ideas, of course, and I’m not afraid to share them, but I don’t have all the experience that everybody else here does, and being able to listen and encourage folks to share their opinions and ideas has been really valuable because we often find a better idea that comes from somebody else.

BW: What do you think you’re best at at Foraker?

SO: Me personally? Well I’m really good at technology, but I spend less time with that right now. I think I’m a good listener. Both for clients and the folks here. Clients need to feel heard, they need to, they want to believe that you understand their problem. I think that’s a strong attribute both of me and Foraker in general. We encourage listening and understanding, empathy, we do a lot of user experience design, we actually do user studies here, so put folks in front of software. Folks that may either be the actual users or representative of the future users of the system and watch them use it. how do they do? Where do they struggle? So in a way that’s also listening to that experience and improving from that.

BW: What would you tell somebody that’s just getting their start? So it’s like you, but 15 years ago, or even before you were a CTO at the company, what would you tell them based on what you’ve learned?

SO: Two things come to mind. The first is to really have a vision for the problem you’re trying to solve. I think there are a lot of folks, including me 15 years ago, that were pretty good at what they did and sort of figured
“Well I might as well do it for myself instead of doing it for somebody else.” It’s a big commitment, there’s a lot that goes into running a business, HR, finance stuff, et cetera et cetera. So have a reason for doing that other than “Well I think I might make a couple more bucks by doing my own thing.” There are a lot of things that come out of running a business that probably aren’t apparent to somebody just starting out. Certainly I have learned a lot. I talk about my million dollar MBA, I don’t actually have an MBA but I feel like I’ve earned that probably more expensively than just going to an MBA program. The first piece is just to really make sure that you have a vision. Why are you doing this, why do you think this is better than letting somebody else worry about the business vision and focusing on whatever it is that you’re really good at? I don’t think running a business is for everyone.

BW: The unsexy side of the operation, HR, finance…

SO: There’s lots of unsexy stuff and there’s lots of frustrating things that have to happen, taxes, and finance stuff and making sure that you’re staying on the right side of all the various HR regulations and recommendations. There’s liability in running a business, you could be sued by a whole litany of different folks at any given point in time so we haven’t been, don’t expect to be, but just preparing and thinking about that. I tend to think a lot about risk mitigation and so maybe I bear a higher burden then the average bear would in that regard, but when you think about all the things that could go wrong in a business there’s a lot to be afraid of.

BW: So as somebody that, you say you’re good at technology, you get technology, I’m very interested in what trends you’re following. What are you, where is the puck moving?

SO: In technology? Well this is going to seem like a strange answer, given all I’ve said about technology, but honestly I think the most intersting thing to me is trying to focus energy away from technology. There’s so much going into technology in the cloud, this that and the other thing, but what’s really interesting to me and what has developed over the 15 years that I’ve been doing this is my interest in focusing on the user. There’s so much really bad software out in the world. I’m sure you and I’m sure all of our listeners have suffered through trying to check out on some site and punch in your credit card, punch in all your information, hit “buy,” and it says “I’m sorry, there’s been a problem on this page,” and you go back and all your stuff’s missing so you have to punch in things again. That’s just a trivial example of things that I think afflict so much of the software out there in the world. Of course the Obamacare website was a pretty infamous example in the recent past, so really focusing on how do we make this easy to use? We use Ruby on Rails as our main technology stack for web technology and it is a fantastic tool for building things rapidly, building things efficiently, I think it’s the best of breed for web technologies, but as a very trivial example, one of the things that was a default early on back when I spent more time doing development was validation error messages. The default was to say something like, if a field is required it would say, whatever the field name is, so “cityname” “City can’t be blank.”
What is easier for users to do is to tell the user what they need to do, so
“Please provide a city.” But if you try to make the technology work that way there are problems with pluralization and some other, so saying “fill in the blank can’t be blank” because it handles all those semantic differences, so Rails did the easy thing, it works better than a lot of things do, but it’s not the easiest thing for the user, so we spend a lot of time actually overriding error messaging to be more human friendly and more action-oriented, so “please do this, please do this, you need to do this” as opposed to just saying “Sorry, it’s not going to work.” So that’s an example where I think in order to make the best software the attention has to be on empathy towards the user as opposed to just finding a cool technology thing that’s gonna make the developers life easier.

BW: So you mentioned doing some user testing and things like that, so what kind of things do you guys do to make the user more a part of your development cycle?

SO: We try to embed user testing in all our projects, it’s something that I think we’ve never had a client say “No no no, I don’t want to do that” but of course spending time on that takes money and so sometimes convincing the client of that, in our opinion, very important budget item, has been a challenge, but in a perfect world we find a representative user and actually have them use early on paper prototypes, later on the actual working functional app to watch them use the system and see where they stumble. See where the problems are, see where we can take something and make it a little bit better. We, a lot of folks speak about user testing, a lot out in the world, so this is not our secret sauce neccessarily, but a lot of people think of user testing as this big thing where you get a whole bunch of people in a room and you ask them whether they like blue or red, we’re actually talking about getting individual people in front of a computer, usually with a video camera, watching their actions and their face and listening to their reaction. I do that with three or four people every few weeks and you can get really amazing information. It’s astounding how often all four people on a small user study will stumble on the same thing. Obviously if four people do it, or even three out of four people do it, then that’s a problem. Needs to be fixed.

BW: For sure. What’s next for Foraker?

SO: Very good question. We’ve been battling with the products versus service dilemma a bit, we have a couple of our own products, both iOS apps right now in the app store, it’s a lot of fun to build something for ourselves. It’s definitely motivating for the team to realize that we’re building something for our own, either to scratch our own itch or for our own passions and desires. It’s a big difference I think between running a service company and a product company, so we’ve been treading very carefully in that decision.

BW: It seems like from this interview series, just about every single company I talk to is like “Well we’re dabbling with something on the side,”
you know? And I’ve heard some horror stories, and even in my own history I’ve experienced kind of the see-saw of clients, you know, their attention, solving problems right here right now, and then product is kind of like that thing we do in our spare time, but then all of a sudden product maybe starts earning money and it’s like well maybe that’s kind of like a client now.

SO: It is a tempting thing to try to do, and I think it’s born out of, in a service business there are ups and downs, we’re either way too busy or we’re not busy enough, and seldom we’re at perfect level of busyness, so when we’re not busy enough, instead of having people just sort of sit around and read Facebook or what have you, it’s more motivating to have interesting things to work on. So I think in a lot of cases it comes out of this idea of “well lets keep people busy, lets keep people doing things that will help them develop their skills and keep their skills finely honed” and then all of a sudden you realize well now we have users that expect this thing to work and are reporting suggestions for new features or perhaps defects that they want fixed and before you know it you’re really really busy with client work and you’ve got some clients or some users of your product that are waving their arms around and asking for things, and then the dilemma really kicks in. Do we spend time on billable work, because we’re ostensibly a service business, or do we spend more time on this product thing? It’s a slippery slope, and I remember the thing that I was going to mention earlier, advice for folks thinking about beginning a new company. The thing that I think is really important is to talk to a lot of people. Find folks who are in a similar situation to you, or maybe are where you want to be, and try to find ways to talk to them. Buy them coffee, buy them beer, I get together every few months with a group of folks from around town that run similar businesses to Foraker and we just talk about things, whether it’s the latest HR thing that happened at one of our organizations or things like products, that was a recent conversation that we had. Talking about what to do with products. So getting the opinions of other folks I think is really important. It’s, I find it both motivating and helpful, so there’s these great nuggets of advice that I’ll get from one of my colleagues, but it’s also encouraging when things are tough and it feels like there are all these things that are beating us down, that they’re struggling with all the same things that we are, so we’re not unique in having all these challenges. it’s nice to know that other folks are doing great work around town, or are going through the same pains as we are.

BW: It’s interesting because I feel like it’s easy to look at your competitors on the web, and look at their website, look at their client projects. Everything on the web is kind of like the front of the house/back of the house kind of restaurant metaphor. Everything on the front of the house, you know, the napkins are folded just right, the utensils are on the right side, you’ve got your bread plate, your water, all that kind of stuff. The waiters, everybody’s very pleaseant. But then you go in the kitchen and it’s like profanity and people spilling things and dropping things and yelling at each other and pushing each other and all that kind of stuff. I feel like when you actually go meet face to face with other agency folks you tend to get that back of the house stuff. I think in my business for too long I hung out in the front of the house with everybody and I was just like “Man, we’re just behind everything that’s going on”

SO: Yep

BW: You know, and it’s easy to kind of be a little bit more critical, whereas when you talk to them face to face they’re like “oh yeah, we’re working on that too, we’ve got that same problem” or “here’s how we solved that.” “I solved that but now I’ve got this new problem and maybe you’ve already faced that type of thing?” I like the idea of a mastermind of a forum or a group of people that you can meet with regularly is fantastic advice.

SO: Yeah, yeah, that’s a great metaphor and that’s absolutely the way that it works out.

BW: Well cool, Stirling I appreciate you taking the time to hang out with us today at uGurus, I wish you all the best, hopefully you can make another appearance some time and give us an update of how you guys have tackled that, once and for all. Whether you decide to stick with the products or not, how you’ve dealt with that 20-person ceiling.

SO: Awesome, thank you.

BW: Well stay tuned for more great content from uGurus.com.

SO: Can you go down and see what those guys are doing and maybe see if they’re cool? Not banging for like an hour.

BW: You made some friends downstairs?