Call me a hater. Seven years ago — never mind how long precisely — having little or no money in my purse, and nothing particular to interest me on shore, I became a hater. Back then it was companies like My Food Bag, which were obvious grifts from the start (not the company, mind you, rather the IPO, which bilked mum and dad investors and transferred their money into the pockets of the founders. I’m told Nadia Lim has a very nice farm now. I haven’t bothered to check).
But the latest, or at least most consistent, target of my ire is Xero’s CEO, Sukhinder Singh Cassidy. Singh Cassidy is a classic product of the Silicon Valley system: work at Google, have a few questionable leadership decisions, publish a book about how great you are, rinse, repeat. Does this remind you of anyone?
Does it remind of you Marissa Mayer, the former CEO of Yahoo! (?)
Let me explain: Mayer was employee number 20 at Google. She was partially responsible for AdWords and the Google UI. Then, in 2012, she was made CEO of Yahoo!, which was — well, how do you put it politely? It was in a period of disarray. Google was it and Yahoo! was a weird legacy search engine with a collection of other businesses.
I was young but cognisant at the time. Mayer’s appointment was treated as a kind of Hail Mary, a let’s-hire-the-bright-thing-from-Google-and-see-what-works type deal. What did she do?
Well, she acquired Tumblr from $1.1b.
Yahoo later sold Tumblr for $3m. Sorry, I need to emphasise that part. Three million.
Who else does big acquisitions? (And I accept this is a bit of a reach, everyone does M&A, but stay with me)
Mayer instituted a bell-curve ranking system for employees, i.e. a form of “stack ranking”.
Who else does stack ranking, you ask??
Oh, Sukhinder, is that you?
The more I think about it the more Singh Cassidy’s career has been foreshadowed by Mayer’s: Singh Cassidy was instrumental at Google from 2003-2009. Like Mayer, her record there is unquestionable. Like Mayer, she was appointed CEO of a few things (more than Mayer) — Stubhub, the litigation-prone ticket reseller, etc. She’s now CEO of Xero. Like Mayer, she’s a fan of saying things like “you need to be bold”. Here’s Mayer:
In a recent interview with Fortune, Mayer said, “As an engineer, my tendency is to be more conservative—to be more iterative. Even on innovation, I would rather bring out an early product and slowly make it better.” But while her natural style is to lean away from risk and apply caution to her business decisions, Sergey wanted to remind her not to let her innate cautiousness limit her decisions.
Mayer says she’s carried Sergey’s parting advice - “Don’t forget to be bold” – with her ever since taking the helm at Yahoo and that it’s been instrumental to some of the decisions she’s made. She said his words were replaying in her head as she made the call to acquire Tumblr and guide her decision around what to do with Yahoo’s stake in the Chinese e-commerce company Alibaba.
Well, for Mayer, Tumblr was a $1.1b acquisition sold for $3m. Yahoo sold the bulk of its Alibaba stake from 2012 - 2015, under Mayer’s leadership. Hilariously Yahoo once owned 40% of Yahoo, which would be worth ~$120b today. I’m being petty but well — I mean, Jesus, those have to be some of the worst investment decisions of all time (up their with the Seagram’s sale of their DuPont stake and purchase of movie studios).
I find the parallels fascinating: both are women who did very well at Google and have had questionable records since. Yahoo is now a footnote in history. Xero’s stock is down 49% for the past five years. Both embody kind of a very 2000s-esque “girl bossery” that feels dated, so much so you half expect someone to start talking about how they’re voting for Hilary and watch New Girl. Yet I’m digressing.
My point here is “be bold”, etc. Here’s Sukhinder in today’s AFR, telling Aussie businesses and the govt how to be better. It is at times a piece so full of ego and so full of Silicon Valley doublespeak that you hardly know where to look:
Well, sure. Yet it’s fairly rich for a CEO who owns no stock in the company she leads to tell ‘Straya about incentives.
Then there’s talk about “cycling upwards”. Frankly all this Silicon Valley mumbo jumbo makes me want to blow my brains out, but sure:
You have to wonder if this is some kind of self-defense for Xero’s purchase of Melio, or the company’s slow US expansion. There is still only 373k US users of Xero’s software, a figure that pales in comparison to the incumbent, Intuit’s Quickbooks.
Then, perhaps, most egregiously, Singh Cassidy lectures us on how we need to be talent magnets.
Perhaps Singh Cassidy has rose tinted glasses on. Perhaps, I don’t know, she is wearing industrial-grade earplugs and is too busy in the AI metaverse to listen to employees. Here’s how Xero rewards employees, from Blind:
Anyway, here’s what one high-performing employee of Xero wrote. Apologies for the low image res:
Here’s more, from Reddit:
One of the things I’ve taken from my engagement with current and former Xero employees is how much they love the company. They love the company but Xero doesn’t love them back. That’s capitalism, baby?!
And yet it’s hard to comprehend what Singh Cassidy means by “be a talent magnet” when the thoughts of her employees read like that above. Just what sort of talent would she like to attract?
Anyway, here’s her closing remarks:
It is possible for any country in the world, Australia included, to significantly step-change its productivity and innovation. This nation already has real proof this works: Atlassian, Canva, WiseTech and yes, Xero, have built globally competitive companies from the southern hemisphere by tapping into these global lessons. It’s possible to do that far more often. Striving for global consistency is one of the single biggest levers to winning locally.
A sample of stock prices of those companies she has mentioned and headlines:
I’ll leave you to draw your own conclusions.