Meet The Operators: Q&A with Christa Quarles, CFO of OpenTable
From conducting Equity Research at Thomas Weisel to entering tech as the CFO of Playdom (which she helped sell to Disney for $760mm), Christa Quarles went on to senior roles at Disney and Nextdoor. She is now the CFO of OpenTable and is in charge of figuring out the strategy for what OpenTable does next after it’s $2.6B sale to Priceline. Christa sat down with Zaw to discuss the ways in which she has shaped the companies that she has been a part of.
You can read the entire transcript of the interview here.
Download the podcast on iTunes here.
Fun Facts about Christa:
Favorite Restaurant in San Francisco: Quince (the burger, the cheese plate, and the caviar are must haves)
Defining characteristics of a Navy SEAL (her husband John): Mavericks with a higher purpose, that can also break your neck with 9 pounds of pressure
Favorite childhood memory: When all of her seven siblings were together
If you could have dinner with any historical figure who would it be? Joan Rivers (a maverick of her time that had to break down so many doors with humor and good nature)
Favorite movie: Shawshank Redemption (feels similar to the entrepreneurial journey)
Key Takeaways
After spending 15 years at Thomas Weisel as an equity researcher, Christa decided that it was time to stop armchair quarterbacking (her words) and get into the game. She left her Wall Street job to join an up-and-coming social gaming company, Playdom (co-founded by Zaw’s partner Rick Thompson). Christa‘s strong finance background helped her with the transition between industries, as it made it easier for her to notice patterns in the business plan and mapping what-if patterns. Christa also had a strong support network which gave her lots of advice and guidance.
Christa attributes her management efficiency to her time at Playdom, where she learned to prioritize. She found that staying scrappy and reaching failure quickly allowed her to learn to focus on what was important. Her motto was learn cheap and fail fast. For example, Playdom would often run advertisements for games that had not been made yet, just to learn if people would play them. By gauging the audience’s engagement pre-launch they knew what ideas were worth pursuing.
Key Take Away #1: By running ads for games that hadn’t been made, Playdom was able to cheaply learn how users engaged with potential products
Christa says that she likes to hire people who are passionate about the company or their part of the company — something she can determine within the first seven to eight minutes of the interview. Their eyes need to light up when talking about 80% of their job. She believes that if you can see and get that passion out of someone, then they’ll work twice as hard and be happier doing it. For companies that aren’t as mission-oriented in their overall purpose, she recommends focusing on the specific role. For example, OpenTable has really interesting artificial intelligence projects where the team has to predict all the inventory and turns of a restaurant. For an engineering candidate, they don’t have to love food and restaurants per se, if they love the problem they are working to solve.
Key Take Away #2: Screen for hires that have a passion for the company mission or the part of the company they are working on
As the companies she joined grew, she found herself holding more meetings, which she does find to be useful (as long as it’s not a meeting to plan the meeting). To create an open atmosphere and encourage dissension, Christa often employs self-deprecating humor to lighten the mood. (Editors note: this is something that almost every operator I’ve interviewed has mentioned, which reminds me to write out some funny jokes about myself to use in the future!)
Key Take Away #3: In order to make meetings more comfortable for everyone and encourage dissension, Christa uses self-deprecating humor to lighten the mood.
Take a look at the highlights of the interview below…
Highlights
Why did you make the transition from Wall Street to the crazy tech universe?
I spent a decade on Wall Street as an internet research analyst, bringing companies like Google public. Then I decided to stop armchair quarterbacking and actually get in the game and do something, so I joined a company called Playdom. At the time it was one of the leaders in the social gaming space. This was circa 2009, to give you a sense of time. I joined the company and it was 175 people, we’d just done about $50 million in revenue. It was on a rapid pace to scale. There was a leader in the market called Zynga at the time, who, we were number two to. Spending a lot of time trying to figure out what is this market? What are we doing? Are we building platforms? Are we building games? Are we building content? What is the face of what these things are going to look like over time?
I think, you know, we were kind of making the playbook up as we went. I don’t think there was a… there’s no known path in social gaming. The industry didn’t exist before. A lot of it was how do you fail as fast as you possibly can? How do you make cheaper mistakes? How do you not simultaneously invest in 10 things and not know if any of them are actually going to give you returns?
Where did you draw your inspiration from? Who were your mentors through that period as you were figuring all of this out?
I have a bunch of people that were helpful for me, so like, Ellen Siminoff who is somebody that I know well and she was, I think, number eight at Yahoo! and had seen, again, all scales of companies and had good advice for that. The other thing was, surprisingly, the Wall Street background actually helped in some ways, which was, I was good at mapping out a “what if” scenario. Really the pattern recognition of what businesses look like really small and then what they look like at scale. You really understand, okay, this has this flavor of business model, and this is what this looks like over time, and this is what the margin structure may look like.
Or it doesn’t. Oh, that’s going to need a lot of salespeople if we actually go down this path and then this is what this is going to look like and this is how this is going to be operationally difficult. Having seen everything from ad models to subscriptions to premium models to consumer pay to, you know, cloud-based models. Sort of weaving that into my own kind of viewpoint helped shape the, I guess, gave me knowledge before I had it.
Is there a favorite or a preferred method that you have in terms of thinking about prioritization?
One is just straight up TAM, or total addressable market. It’s how big could this be and it is not correct 100 percent of the time but you at least have to have an assessment of, is this a billion dollar opportunity, is it a 10 million dollar opportunity? What is the scale and proportion of the opportunity? Then, what are the things I will, what are the sign posts that I’m actually going to be on the right track. Part of it is, okay, I’m not gonna just throw 200 people at it and say, see you in a year. It’s more like, okay, how do I, how do I learn cheaply? How do I fail fast? You know, at Playdom we did some really interesting things where we knew that the only mechanism for distribution was Facebook and so we put out an ad on Facebook for a game that didn’t exist yet, to see and understand what is the adjustable like, what is the demand flows for that, for that game going to be?
Then we gave them some sort of questionnaire at the end to see if they’d actually play it. It was more, and that was sort of interesting, but we didn’t really get as much from the questionnaire as I did as to, okay, who clicks on this, who doesn’t, what is, what are the things that I can learn without actually investing a ton of money to decide whether or not we should continue to go forward. A lot of it is just… how do I get to the fail state? How do I learn as quickly as possible and as cheaply as possible? Putting five engineers on a quick and dirty project — I’m a huge believer in duct tape and chicken wire to get something done. I really, perhaps even most of the time, it’s unscalable fashion. But just to get information and data to say, what’s the binary, good or bad? If so, keep turning cards and continue to see the next, hopefully, good move in the right direction.
How do your run your meetings? Anything you push for?
I do actually like a good meeting, if it has a purpose. There’s places where they like have the meeting before the meeting, so there’s no surprises in the meeting. That’s not how I like to run a meeting. I don’t have time for obfuscation. The thing I like about a good meeting which is, if it does have purpose, how do you get to the truth? How do you get to the decision node? And then how do you move as a result of that? How do you actually figure out what it is that you’re trying to solve, get to it, articulate it, and then set things in motion, set people in motion, teams in motion, etc?
It’s really hard to do that in any other format. But, you have to have a group that’s really willing to be honest and get to the truth and, if you have a bunch of people who are obfuscating reality, then you’re not going to make progress. That’s why, in fact on my own teams, I encourage dissension, disagreement. I want all the ugly truth in my safe ensconce of my team so that when I go out, I have kind of been forked, I’m through the crucible, I’ve been tested by people on my team with this different opinions
Is there anything that you’ve found that makes it easier for people to dissent?
Humor, honestly. I find that if you can soften — often times through self deprecating humor — a situation so that somebody on the other side is like, oh, I can hear it now, I can hear the truth. It’s a way to make it not so painful. It’s not your issue or my issue. There’s an issue here, and if we can create some levity around it, create some openness and acceptance, and when you have that acceptance you can start to move. It’s like… how do you get those difficult messages? How do you get people to hear the things that they may not want to hear? I think you can do it. You have to be empathetic and you have to be a human being. You have to figure out how to... I love people, environments that appreciate good humor. I feel like you can get, and maybe it’s cause I’ve also been in creative environments too, that it ends up going pretty far and it’s appreciated.
How do you think about culture, as it relates to both great humor in meetings, honesty, is there a guidebook for you?
Yeah, I mean I don’t know that there’s a guidebook. I wish there was. I do think it is the, the honesty, the getting to the truth… that was something that I would say all the time in meetings which is, and you know what, making sure that the data has a voice in that truth, frankly. Often times it used to be there was a loud person in the room and then they won the argument and then they went off. But how you actually infuse those discussions with data to help provide truth… I think it’s really not putting up with the drama, not putting up with the like “he said, she said” — what is the intention? I ask that in meetings all the time.
Especially when somebody does something that irritates somebody and it’s like, what is the intention, how do you put yourself in what their shoes are? How do you create the empathetic understanding of why they may have said that thing? Now you can understand either is there fear involved, is there… what is that thing that is driving that thing that’s annoying or frustrating. If you can get people to articulate the intention of the statement, then you can usually get around it, behind it, and frankly back to the truth of what the matter is.
You talked a little bit about you’ve got different patterns of connecting dots. Do you want to walk me through that again? Through small companies, now going back up?
I said before I had so much respect for entrepreneurs and people who can just blank sheet some idea and put it on a piece of paper and believe that it will work. I’m not necessarily good at connecting those initial dots, but I’m really good at multiplying the dots. It’s taking that initial neuro connection and saying, okay how do we actually create the brain? How do we make, if there’s, if I can go international, I can go to adjacent markets, I could do all of these different things, but how do you actually take that, what is the asset? What is the goodness that got created initially and then figuring out how to multiply that in and around the company.
Sometimes it’s… I think there’s a point in time in which you have to evolve with what that original thing was, too. That’s one of the experiments that I’m a part of here at OpenTable which, for the history of the company, it’s really been a singular business model. It’s a restaurant will pay a subscription fee and then they pay $1 per diner. We’re looking at evolving that pretty considerably, which is really exciting because now I’m saying, look, maybe your regulars are free and if I bring you a diner when you’re empty, maybe that should be worth more to you. Evolving on, what the value is that you’re bringing into an organization.
Have you found any guiding principles for you around the way that you think about hiring and growing teams?
There’re two questions in there which is how do you survive this Bay Area hiring challenge and there, I mean, it’s a combination of hopefully there’s really, it depends on what you’re hiring for too, sometimes there’s really interesting artificial intelligence projects that you’re dividing, which is how do you manage all the inventory of a restaurant with turns and table and configurations of sizes and all these things and so maybe some engineer is super interested in that. Some people just generally might be interested in the mission. When I go to hire somebody specifically, so much of it is just… do their eyes light up when they talk about 80 percent of their job, really, truly? Because if you can see and get that passion out of someone, then they’ll work twice as hard and be happier doing it and you’ll get the loyalty out of them.
It’s amazing to me where I will interview a candidate for a job and when I’m talking about the majority of what they’ll be doing, how they have no interest in actually doing that thing. You go, gosh, can you get that Ven diagram of what you’re good at, with what the company needs you to do, and what you want to do all overlapping one another? Then you end up having a good fit and a good connection. But it’s surprising to me. Hopefully I weed those out before we actually get to a face-to-face interview. You could waste a lot of your organization’s time, frankly, interviewing the wrong people. Making sure that you actually look and say, what are your outcomes, are you actually interviewing the right people, are you getting people closed and, if not, then taking a look at it.
Do you have a favorite interview question?
No, it’s funny though, but I usually know within the first eight minutes whether.. It’s not quite 10, it’s not quite five, it’s usually somewhere in between, which is, is this… am I going to need a second interview or not.
You can read the entire transcript of the interview here.
To learn more about OpenTable, check out their website here and be sure to follow Christa on Twitter.
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Thanks, as always, to Brian Ko, Rahim and Gina for all their help!
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