Deep Dive with Linda Findley

INTRODUCTION: Welcome to the Daily Bolster. Each day we welcome transformational executives to share their real world experiences and practical advice about scaling yourself, your team, and your business.

Matt Blumberg: Welcome to The Daily Bolster. I'm Matt Blumberg, co- founder and CEO of Bolster, and I'm here today with Linda Finlay. Linda is a global e- commerce and DTC leader, who has held leadership roles over the years at Etsy, at Evernote, at Alibaba. She's currently the president and CEO of Blue Apron, which is a meal kit company. They deliver pre- portioned, seasonal ingredients to help you create delicious meals at home, while reducing food and packaging waste. Linda, thank you for joining me today.

Linda Finlay: Thanks so much for having me.

Matt Blumberg: So I love doing these Friday In Deep With interviews to really talk with someone about the arc of their career. There's so many different paths that people take to the CEO seat, and so many different lessons that they've learned along the way, so I'm excited to talk to you about that today. And it was interesting when I went to look at your LinkedIn profile, you and I have known each other for a while, but not 20 years or 30 years, and I learned some things about you. So, I knew that you had worked at Alibaba. I did not know what you did before that. So you started your career with a couple of different roles in PR.

Linda Finlay: Yeah, I did.

Matt Blumberg: So let's talk about that. How was the early part of your career, the training ground for you to join a massive, massive company, Alibaba, in a leadership role?

Linda Finlay: Yeah, it's interesting. I actually really early on started out as a journalist, and I just loved the concept of communications and how important communications is in every aspect of life, whether it's personal relationships, business relationships, et cetera. And so, I became really, really interested in communications early on and moved from journalism into PR, corporate communications, et cetera, particularly on the strategic side, because I always used to joke that anytime there's more than one person in a room, you're going to have confusion, and I'll always have a job. And that was the initial concept behind it. But the reality is that the interesting aspect of PR and communications is it is the intersection of business media influence, and how people think about those interactions, and how they actually move forward. So, I really loved working in the communication side, because I was able to see a variety of different business situations. I worked on product launches, I worked on IPOs, I worked on crisis communications, and I did a lot of global work. So, a big part of my work was bringing cultures together and helping to think about how to communicate between the two. But all of that was really, as I grew in that career, I started managing a P& L, I started managing multiple offices, I started managing multiple teams all over the world. And as I was getting into that P& L management, it really struck me that I loved the business aspect of being able to manage some of those decisions. At the same time, you're also matching the fact that your job in communications is to always anticipate what the customer, the public, the investor, et cetera, is going to ask next, and be a couple of steps ahead to be able to understand what that is, and bring transparency to what's happening. So I started out my career that way, but just really, really became fascinated with operations through my later roles of running larger teams and groups, and P& Ls, and wanted to make that move. And honestly, the move into Alibaba was a fantastic one for me because I was able to start out on the communications side with the knowledge and the full disclosure that I wanted to move into a business operations role, and one helped the other. We did five acquisitions the first year that I was doing communications there, and that naturally led into a lot of the business synergies that we were growing globally as the company was becoming a much more global company. So, it was really a very natural transition, I thought.

Matt Blumberg: Did you ever have a moment before you went there of thinking like, " Hey, PR is going to be my career, and what I'd like to do is start an agency, or grow in the ranks to run an agency?" Or was there a moment where you were like, " Yeah, I need to figure out how to exit the train?"

Linda Finlay: It's interesting. I always knew that I wanted to take a leadership role. I always knew that I wanted to be a CEO, and I think I did assume that it would be a CEO of an agency. But what I really discovered is I got further along into the strategy aspect of communications, and again, really starting to do things like setting a new course or strategy for a company is I love being close to the product. I love being close to what's actually being built, because the product is where it's at. And that's how people really get to understand a brand, get to understand a company, and they're voting with their dollars. They're actually buying your product based on the effect of that's their vote. And so, I never thought about starting my own agency. That wasn't really something that I was interested in doing. I really love transforming and taking teams that are already strong and great and figuring out new ways to develop that. But I did think about leadership, but then I just got very excited about being able to really change product direction and drive new product initiatives. That was what got me most excited.

Matt Blumberg: So, what was your second job then at Alibaba? You started there in a comms role, and what did you get promoted into?

Linda Finlay: Yeah, so I moved into what was called international business development and marketing, where basically it was everything outside of China, bringing together buyers and suppliers, and driving both the partnerships and the marketing, and just the general corporate development of thinking about the expansion of the next phase of Alibaba. So I worked for the B2B unit, so I worked for alibaba. com, the original part of Alibaba. And that was a really exciting move for me, because a big part of what we were focused on was driving the global strength of the company. It wasn't as well known when I joined the business, outside of what you might've heard of, either through Yahoo's investment, et cetera, it wasn't as well known. And so, this was a major time at the business as the global business was really taking off, and that was a big part of my job was helping to shape that through connecting buyers and suppliers, even beyond the China relationship, anywhere in the world to anywhere in the world.

Matt Blumberg: That's so interesting. And you were living abroad, right? You were in Hong Kong?

Linda Finlay: Yes, I was living in Hong Kong for four years, yeah.

Matt Blumberg: Did you ever get to meet Jack Ma?

Linda Finlay: Oh, yes. On a regular basis.

Matt Blumberg: I assume in both of your roles you probably were close to him. He's a business leader that I think everyone knows his name in the US, but people don't necessarily have his vibe the same way. If you ask someone here, " Tell me three things about Steve Jobs inaudible business, in tech in the US they'll give you a bunch of things." What is he like and what was his management style?

Linda Finlay: Yeah, incredibly innovative, incredibly calm. Very, very focused on being able to think ahead of the curve, and really just extremely willing to take chances, but not in a bad way, in an extremely positive way, of really seeing around the corner and saying, " Hey, I think we can do this. I think we can do that." But his centering philosophy was prevalent throughout the entire company. It was very big on culture in the company, very big on bringing people together across Alibaba, very big on cross- training, very big on developing people within the organization. But yeah, an incredibly inspirational leader, and because of when I came into the company, I had the opportunity to work very closely with them.

Matt Blumberg: Yeah, it's always interesting to hear what people like that are actually like. So, what drove the move from Alibaba to Evernote, where you were the COO, and I'm guessing moving back from Hong Kong to the US?

Linda Finlay: Well, it was interesting because I was moving back to the United States after four years, and had the opportunity to continue on with Alibaba, but the center of gravity... Really for what I do, you have to be near headquarters. And so there was a lot of back and forth, and I will forever always be indebted to that company, and still love to go to the alumni events and everything else, because it really is almost like a university. You're so connected to the people that you work with. But during the time that I was living in Hong Kong, I got to know Evernote through another friend who had introduced me to it, because that person knows that I'm an organizational freak, and I really like to have everything at my fingertips at all times. And so-

Matt Blumberg: Talk about having passion for your product. Right?

Linda Finlay: Exactly. And it was interesting because I hadn't heard of it at the time, but he was a power user of Evernote. He introduced me to it, and also asked if I would be willing to talk to the CEO about expansion into Asia, China, Taiwan, Korea, et cetera. They were already incredibly well- established in Japan, and very popular there, but just wanted to be able to give some casual advice, and so I did. But as part of it, again, being passionate about what I do, of course I tried the product and immediately fell in love with it. It's an incredibly, incredibly useful product, and it just for somebody who doesn't like to have a lot of things and pieces of paper and stuff laying around, it was the perfect solution. And so, I had gotten to know the company and gotten to love their product, and when I was moving back to the United States, I actually reached out to the CEO at the time and said, " Hey, listen, I'm coming back to California, would love to just talk to you about what you're doing, and would love to hear what you're working on and see if there's any way that I can help." And that's how I wound up at Evernote. It was immediately coming into a global role where I was able to bring some of that work that I had already done in Asia together with the rest of the world.

Matt Blumberg: And what was the company size, shape, stage when you got there? And actually what is it today? I've lost track of it over time.

Linda Finlay: So, it was about a 300 person company at the time that I was there. It was definitely in high growth mode. I joined when it was around 50 million users, and I left when it was 200 million users. So, it scaled pretty quickly, mostly through the partnership side then. There wasn't a huge amount of marketing in the business, it was a lot more on carrier partnerships and some of the great work that the team was doing there. So yeah, it was a phenomenal, phenomenal experience. I think the thing that very few people know about Evernote was 80% of the user base was outside of the US. So, you had a huge amount of work that you were doing across Japan, China, Brazil, Europe. It was just on a plane all the time, and it was just a lot of fun. Really, really cool partnerships at that time. Evernote actually was recently acquired by an app development company, and so they're now taking it over and they're building it out, building some new features across that and a few other apps.

Matt Blumberg: But that's been a bunch of years since you left. Did the company continue its path independent, still founder led?

Linda Finlay: No. Again, it was acquired I think two years ago now.

Matt Blumberg: Okay, right.

Linda Finlay: Maybe last year. But, yeah, it was acquired by an app development company that's really taken that piece over. But, yeah, it's evolved quite a bit over the years, but I still talk to people every day who use it all the time for all of their notes.

Matt Blumberg: What was the best part about being a COO, and the worst part about being a COO?

Linda Finlay: Being a COO is great. You have such an ability to make an impact across so many parts of the business. I will say I think the worst part about being a COO, and I actually did a talk on this once on different types of COOs and there's multiple types-

Matt Blumberg: That was going to be my next question is inaudible-

Linda Finlay: It's interesting because the worst part about being a COO is it's a different role everywhere. So it's always hard to explain to people if you just say, " I am a COO." Then that's only this tiny bit of the story. Almost every other role is pretty clear on when you talk about it, but it's the role that has multiple definitions. And so, establishing the right definition of what that role is for that company at that time is actually, I think, the least fun part about it, because there's not an easy explanation or an easy path. You have to shape what's right for the business at that time.

Matt Blumberg: But it's probably the most important thing to do, for role clarity and such. It's funny, when our team wrote startup CXO, there's a section on sales, and a section on marketing, and a section on finance, and we went round and round and round on what the COO section should look like, and we just gave up, because it's not the same job anywhere. So there's a four- page section on COOs that basically says, " There are lots of different kinds of COO."

Linda Finlay: Yeah. But it's true. And I think, to your point, that's why defining it is so critical. You have to define what it is for that business, otherwise it causes more confusion than help.

Matt Blumberg: Yeah. So you were A COO twice in a row, so Evernote, and then you got recruited by our mutual friend Chad to come be the COO at Etsy and pick up your life and move to the East coast. What was the difference in the two flavors of COO?

Linda Finlay: It's interesting, the roles were actually very similar, because both of them were centered on how do you bring together all the customer touchpoints into a single type of role where you can help make sure the consistent experience across the entire, whether it's customer support, whether it's product marketing, et cetera. So, I think the roles were very, very similar. I will say the difference between the two is the Evernote role had a lot more of a partnership then to it, in the work that we were doing, because that was a big part of how you got scale from an app perspective. Whereas, Etsy is much more about community and bringing communities together in a marketplace model, so you actually have physical goods moving around, even though you're not touching them. And so that was a much more marketing heavy role than the Evernote role was, just because of the phases of the companies and the types of products that they actually had. But the other big difference is Etsy was at a pretty big inflection point when I joined. I came in at a time where the company was resetting itself and thinking about a new world of competition and a new world of focus, and it was a public company. So, a whole different level of accountability, but an incredible, incredible opportunity, and an incredible team, building out really, really unique products, which was great.

Matt Blumberg: So, Chad has been on the Daily Bolster a couple of times, and we talked a lot about the journey at Etsy as well. And one of the things he talked about was actually the difference in revenue composition from when he left to when he took the CEO job, which was six years, was pretty significant.

Linda Finlay: Yeah, absolutely.

Matt Blumberg: And I actually think that's one of the real challenges that scaling companies have is how to introduce new revenue lines that are big enough to matter. So Etsy, when you were there, decent scale, public, hundreds of millions of dollars in GMV, if not billions of dollars in GMV. What's an example of one or two revenue lines that you introduced, and how did you think about innovating within to make an impact quickly enough?

Linda Finlay: Yeah, it's actually interesting that you asked that question, because I think it's more important to talk about the revenue lines that we didn't introduce. And what I mean by that is, and this speaks to this idea of focus, which I think is incredibly important, and when you have big opportunities, you're often looking at multiple ways that you can extend. And one of the big decisions that we had to make as a business was there was a new site that had been launched that was specifically about craft supplies. Most people were buying craft supplies already just on the core site. And we wound up actually sun- setting that site and working it into the core part of the business, because what had happened, and Chad and I used to talk about this all the time, and then also later, Josh, who was the CEO when I left, but there was a lot of focus on building some of these new areas, but over time, fewer and fewer people were working on the core website. And so, oftentimes the first place you should look in any sort of pivot or transition is at your core business, and can you make more out of that core business? And that's really where a lot of the growth opportunity came from was reintroducing new features for buyers, in the core business. So the business started really with a strong focus on sellers, and building the tools for sellers, et cetera. But a big part of what sellers wanted were more buyers. So, driving that shift of putting a lot more resources on the buyer experience was one of the big pivotal moments at Etsy, which was driving revenue, but driving it through something that was already there. A magic bean, if you will, that was already present in the business.

Matt Blumberg: Yeah, that's a great point. It's the things you do and the things you don't do that define your tenure. So, let's move to your current role. So you're the CEO of Blue Apron, you have been in that role for four years, five years?

Linda Finlay: Four and a half years. Yes.

Matt Blumberg: Four and a half years. And so, it's your first CEO role. It's a public company, so higher degree of difficulty dive, and also a little bit of a turnaround, I think even when you joined. Not to mention managing a company like that through the pandemic.

Linda Finlay: Yes.

Matt Blumberg: Talk about the last four and a half years, what's worked? What's been tough? What's been unexpected? What's great?

Linda Finlay: It's a very big question. So it was definitely a turnaround when I came into it, frankly, as was Etsy when I came into Etsy. A different type of turnaround, but a turnaround nonetheless. And I think a lot of what you think about when you think about focus and when you think about building new products and engaging new customers has been really critical for the business to actually grow and have strength. But the reality is nobody expected COVID. And I think there's a little bit of an interesting challenge there because when I joined the business, I knew that we needed to build new products and we needed to increase variety, and we needed to focus on the core. We needed to use what we already had, because in the competitive landscape, variety and choice was really the way that you drove growth. So we leaned heavily into that, and it was incredibly successful in that we drove more product innovation, or more product launches, in 2020, which was the first year of COVID, than in any other year in the company's history. And then again in 2021. And this resulted over time by adding variety. When I started, there were about 17 choices, and now we're in the eighties in number of choices, and that's driven a significant increase in revenue per customer. So, dramatically more revenue coming from each customer than before, in the range of 25 to 30% more revenue per customer on average, over that tenure. And so that's been an incredible strength of the business, and so being able to launch that variety, particularly during COVID, I think has been important. On the flip side, I think the challenges have been ones that we've talked about publicly quite a bit. The company was very capital constrained and was managing a significant amount of revenue, hundreds of millions of revenue, on very little cash in the bank at any given time. And so you're trying to both lean in and grow the business at the same time you're trying to manage that cash. And then when COVID hit, everyone thinks that this is a massive opportunity, and it did drive demand for sure, but this is a physical product. You can't create it out of thin air. And it's packed and made by human beings who were dealing with the same challenges as the people who were staying home. So, dealing with the nuances of making sure everyone's staying safe, making sure you're still growing the product, making sure you're still growing the business, it's actually a really, really important balance. And we chose, given the capital constraints of the business, and given the fact that we needed to be competitive in the long run, not necessarily just in the short run, we chose to focus on continuing to expand the product set. And that's driven that revenue per customer, and set us up with the ability to drive, what I would say is, an incredible repeat rate. I talk about this on a regular basis of people thought of us in the beginning as a subscription business, but the reality is you can skip anytime, you can do whatever you want to do. You don't have to buy a box every week. So, we're actually more of an e- commerce business. And so, we're going for AOV, we're going for repeat customers, we're going for engagement, we're going for average cart size, we're going for all of those traditional e- commerce metrics. And when you think about it in the scope of most e- commerce companies out there that might have one or two purchases a year, the reality is we're looking at five a quarter, and the average order value of those is above$ 70. So that's a very, very rich customer base, and now with the variety we have and some of the new products that we plan to introduce in the future, our hope is that we can capture even a larger TAM, building off of that choice that we had to make during a very difficult time during COVID.

Matt Blumberg: Yeah, no, I remember some of your stories from COVID and just worrying about what was going on in your warehouse, or however you refer to it. What are some of the challenges? So, you have a workforce that's a little bit different than a lot of other tech companies, which is you have the in- office workforce, and then, I don't know how you refer to them, warehouse workforce, or pack and ship fulfillment workforce.

Linda Finlay: Yeah.

Matt Blumberg: How have you reconciled those two things? Or how did you manage them the same way? Do you manage the two groups differently?

Linda Finlay: Yeah, it is interesting because there's a benefit to it, because seeing the product end to end in the beginning was extremely helpful. But this is particularly timely from a question standpoint, because what we just actually executed was a very unique transaction about a month ago where we actually sold the operational infrastructure of our business, so the fulfillment centers, to another company called FreshRealm that does nothing but fulfillment and manufacturing of fresh foods. And this has really been an interesting move for us, because when you think about most e- commerce companies, or even most just retail companies, most brands, they design their products, but they don't manufacture their products. They work with suppliers around the world to get the best quality at the best price, et cetera, for their customers. So having everything verticalized in the early days made sense because of the fact that you have to... There's no one else making meal kits, so you need to do it all yourself. But now what we've actually shifted to is the ability to work with a world- class supplier of fresh food products, who can provide other types of equipment and other types of product capabilities to us that we didn't have before, because we had to own everything ourselves. We now have the ability to work with them and purchase those through a traditional COGS model, like you would see with most companies, and then the core business with the brand marketing, customer support, product design, all still has all the same revenue, all the same customer interface... We're able to own the customer interface, really focus on that, and save costs in the meantime. Because through this transaction, we're able to take what was an unusual structure of having both the fulfillment and the core tech and brand, and that part of the business, and actually let each one focus on its own strengths, and get faster scale on the operational side of the business, by combining it with another company that does broader food manufacturing. So, it's been a really interesting last several months, but that structure has just recently changed and allowed us to focus a lot more on the core business, which is serving our customers, developing great products, and really driving efficient marketing programs.

Matt Blumberg: That is super interesting. I actually did not know that. So, I'm clearly not paying attention to my...

Linda Finlay: You've been busy.

Matt Blumberg: Did you think about doing it the other way? So that's a pivot of really doubling down on one part of the business, and effectively exiting another. Did you think about the reverse? Being the fulfillment engine, buying that other company and selling off the front end?

Linda Finlay: Honestly, the asset of the brand is so massive for us. We have 82% brand recognition, which is huge in this -

Matt Blumberg: Wow, that is huge. Yeah.

Linda Finlay: And so it's really about that customer experience and that ability to create that marketing engine, and that customer experience engine, that is really the core of the business in my mind. So from our perspective, this was the right way to do it, because we already had a great partner in FreshRealm. They were already partnering with us on other parts of the business, and so we knew we could trust them, we knew we could work well with them, and this lets us really take that very valuable brand and focus on customer engagement and growth.

Matt Blumberg: Got it. Well, that is very interesting. It opens up a new chapter for you there.

Linda Finlay: It does.

Matt Blumberg: Let me turn to the last topic I wanted to cover, real quickly, which is boards.

Linda Finlay: Yes.

Matt Blumberg: So obviously you have a board, you manage your own board. But you are an independent director on I think three boards, two for- profit, one non- profit,

Linda Finlay: Two for- profit boards now. So I continue to do non- profit work, but no longer sit on the board.

Matt Blumberg: Got it. So you're on Ralph Lauren, and what's the other one?

Linda Finlay: StyleSeat is the other inaudible.

Matt Blumberg: So how do you, as a CEO, so you have your own board, you manage your own board, how do you take on the role of independent director? Not your company, some other CEO. how do you think about adding value to those companies, without having your hands in it quite so much?

Linda Finlay: Yeah, it's interesting, because board roles are very different, depending on the board and the composition of the board itself. So some boards are very, very hands- on. Some boards from a governance perspective are much more hands- off. But either way, your job is not to run the company. That is not your job. And I love the fact that when you find boards that are a mix of operators, and people who are former operators, you wind up with a really interesting mix of people who already have their hands in something that's moving on an ongoing basis. And then also people who have a lot more time to be able to spend on deeper issues that maybe they might have experienced in their career, and so you get a really good balance there. So for me, it's actually incredibly helpful to sit on these boards because one of them is a very large public company, and the other one is a smaller, very agile, what I would call startup, even though it's been around for a period of time. And so, you see all the different patterns and ways of working that different types of companies can go through, and then you can think about how do I take these learnings as far as ways of working and approach back into my own board and my own job? But because I'm a current operator as well, we were just talking about going through the COVID time period, the world has changed dramatically in the last three years. And so, being able to bring real- world, current experience without necessarily interfering, but being able to say, " Okay, I've seen this. Here's something we've done here. Here's how we've pivoted in this direction." I think is actually very healthy, from an overall mixed perspective. But I always think the best board relationships are you always want to make sure you can dedicate the right amount of time, so you never want to overfill yourself to the point that you can't do the real work that needs to be done on boards. But you also want to make sure that you can make it a truly symbiotic relationship. I get something out of being on the board as far as information I can take in and learnings that I can develop, and then hopefully I can make those companies a little bit better, sharing the knowledge I have as a current operator.

Matt Blumberg: Yeah, I think it's a real best practice for CEOs to sit on someone else's board, at least one or two. And I'm the same way, I leave any board meeting of someone else's board with a whole page full of notes of things I need to go do differently, so-

Linda Finlay: It's also a very good reminder when people say, " Oh, you should really do it this way." You're like, you know, "I never want to say that to someone else, because it's always hard to know what it's like to sit in the actual seat."

Matt Blumberg: Yeah, that's for sure. All right, Linda Finlay, thank you so much for joining me today and chatting about your career. Good luck with the next chapter of Blue Apron.

Linda Finlay: Thank you so much.