Recruiting and Compensation Lessons from Josh James and the Omniture and Domo Journey

During SaaStr Annual 2017 Day 3, Domo CEO/Founder and former Omniture CEO/Co-Founder Josh James sat down with Jason Lemkin to discuss his lessons from building two successful “unicorn” SaaS businesses.

On JoshJames.com, Josh has laid out 56 Startup Rules from his experiences at Omniture and Domo. During his interview with Jason, they dove into a few of these startup rules, including a couple that focused specifically on hiring and compensation that I found extremely beneficial.

No good employee will walk through the door. Must recruit like you sell big customers. Must learn skill.

The best employees are always employed — and happily employed. You have to be methodical in your recruiting and treat recruiting like it’s a big sales deal you’re trying to win. That is how you attract the absolute best talent.

Your first 20 employees are especially important. You can’t settle for “B” players or “good” employees—you have to have the best when you’re at this stage. Like customers in the early days, you can’t waste time on the “wrong” customers and you don’t have the freedom to waste any time on the wrong employees.

Some would say Domo, which is based out of Utah, might have a hard time recruiting based on location, but Josh has turned this philosophy on its head. He noted, “If we can get them on a plane, we’ll close them. We use the other CEOs in town as recruiting ammo to recruit my COO or CMO.”

Being in a market away from the coasts like we are in Indianapolis, this is incredibly important for us as well. We utilize our entire network of portfolio companies and broader Indy tech community to help in recruitment.

Spend a few days each year on detailed comp plans…the most powerful operational weapon you have. #startups #alignment

Josh told the audience they should be creative with their comp plans and incentives. Comp plans and incentives can be the most important and powerful lever you have.

Josh gave a couple examples of creative incentives he used at Omniture and Demo over the years:

  • When we couldn’t hire people fast enough into the business, I gave a $1500 bonus for each new hire one of our leaders made
  • When we were struggling with our Gross Margins and looking to improve, I told our CTO I would give him a $50k bonus for every percentage point our Gross Margin grew by. He wasn’t our CFO or CRO, but he became the czar of our operations, taking everything from discounting and pricing to our technology infrastructure efficiency under his wing.
  • Whenever a new deal would close, we would let that sales rep choose their victory song and blast it throughout the entire office.

You do need to be intentional and careful, though, because as Jason Lemkin noted, “What you incentivize, you get.”

It was incredible to hear the Omniture story — including maintaining 100% client retention for the first 6 years of the company — and the the differences when it came to growing and scaling Domo from Josh. I highly recommend you check out the recording of the session when they’re released on SaaStr.com in the coming weeks.


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