I am the founder and CEO of StackTrek and we specialise in using algorithms and data to build and scale programming teams for tech companies. Each week, I chat with top executives about startups, culture, and tech hiring.
Sharing insights from my recent conversation with Trivago co-founder Rolf Schrömgens.
What is the most important thing for an entrepreneur to remember when launching his/her own startup?
Schrömgens: For me, as an entrepreneur, it’s all about yourself. I like to trust myself because I realised and I learned that whether I’m getting financing or hiring the right people, in the end, there’s only one person I can blame and that is myself.
Also, as a manager, you have to make the first decision. Everything starts with you. You create the ecosystem and when your people make the wrong decisions or you hired the wrong people, you are responsible. Although, I’m not so much into making decisions myself but more into building the right ecosystems where good decision-making is possible.
What is the most difficult challenge yet you have encountered when you launched Trivago?
Schrömgens: The first challenge for us was to survive. We had very few resources when we started and we did the coding ourselves. So, basically, our first challenge was that we had no money. Our second challenge was having money.
You start getting your first investor in and from having no money and then now you have a lot of money and you ask yourself, “Now, what do we do with the money?” Now, you’ll have to do more and be faster and so on. But you might not have the right structures in place yet.
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That’s really challenging because it puts a disruptive element in the culture. You haven’t yet built a culture and then you get money in and it changes how you operate.
For Trivago, we only did two small financing ground at the beginning. We never did that again but it has helped us grow the company out of the cash flow. This helped us maintain our culture and sustain our internal organisation.
What kind of leader are you in terms of leading your company?
Schrömgens: You can be a great innovator like Steve Jobs, who has all these amazing ideas and pushes them through the organisation. That’s one way to be successful. I don’t consider myself one of those people. For me, innovation has to happen through the organisation. I think it’s more stable that way.
If innovation can happen to many people in the organisation, it’s more stable and more sustainable. So, from my perspective, my job is to create an environment where innovation can happen. I think the strongest innovation for a product – in creating value for your users – is through building a perfect organisation.
That’s what I’m trying to do; building a perfect organisation where creativity can thrive and you can execute on it and create great products.
Trivago has been growing into a bigger company recently. What is your strategy to make sure that your company is stable?
Schrömgens: Trivago is an agile company. We work hard to keep this alive by using agile concepts, even with a thousand hundred people. We believe in trying and believing in an evolutionary process more than a strategic one.
For that, you’d have to put a lot of things together like the culture, the kind of organisation you created, and the motivations of the organisation. It’s a tough thing to do and it gets tougher the bigger your organisation grows. You have to be radical in your approaches if you still want to be able to innovate in high pacing. You need to exclude all ego from your organisation and make sure that your people are not extrinsically motivated but intrinsically strong and motivated. You also have to find the right setting in place.
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Back then, we followed the traditional leadership model where you have one leader in a team but that didn’t work for us anymore. We changed it to have more or less three leaders per team. It may be hard to do this in an organisation where there are a thousand hundred people but I think it worked in Trivago because we fostered a culture where this is accepted.
Our culture isn’t about status or titles; it’s about driving the company forward towards creating a great product. This culture took about many years to cultivate in our company.
You’ve been talking a lot about managing organisation and people. Trivago as a tech product and Trivago as a company, which one do you focus on more?
Schrömgens: It depends on the stage of the company. When we started, I coded the first version of Trivago myself and there was a lot of focus on the end-product. We stayed there for a while but when you start having a thousand people in your organisation, you have to pull the creativity out of those people. You can’t just pull the creativity out from yourself – that would be very inefficient.
So, eventually, your scope has to change from focusing on the product to creating a good product through creating a good organisation. That’s where I invest my time now.
My time investment has changed drastically from being the one creating the product to guiding people to create the product, to deliver ideas to the product, and to the delivery of ideas for changing the organisation. Communication is also very important in this process.
When you entered this industry, there were a lot of naysayers. How did you react to them?
Schrömgens: For me, it’s a question of how you expose yourself to these noises. We all have a tendency to be insecure and get confirmation from others that’s why we talk to a lot of people.
But I think, sometimes, you just have to say no and focus on your product, your customers, and your users. That’s the most important thing. It’s not about your competition in the industry.
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You’ve experienced dealing with investors for your company. What is the one you’ve learned out of that experience? What advice would you give to those who are also looking for investors for their company?
Schrömgens: I think that it’s not healthy for investors to lead the company. I think they should be hands-off. I’ve also been an investor myself and I would rather that investors not interfere with the day-to-day operations of the company and instead, look at their long-term performance.
You don’t have to put a show for your investors; just focus on your product and make sure that it solves the problem of your users.
What is your advice to those who are launching their first startups?
Schrömgens: If you want your product to have great value in the future, you need to focus on one thing. Especially when you have a lot of competition in a specific industry, you need to find your niche and find a vertical where you can deliver a great product value. Just work with one problem and try to deliver a great solution for it.
Each week, Billy Yuen talks with top entrepreneurs, investors and executives about startups, hiring and building awesome teams. This interview has been edited for space and clarity.
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