Kelly Steckelberg was a career finance executive and CFO when she was tapped to be chief executive of her former employer, a mightily struggling consumer Internet company.
She proceeded to execute a deft turnaround over two and a half years — and yet now she’s again a finance chief, at another company, with no regrets.
Steckelberg began her new gig last November leading finance at seven-year-old videoconferencing provider Zoom Video Communications, which qualifies as a unicorn with a valuation of $1 billion.
She previously worked with her boss, founder and CEO Eric Yuan, when he was vice president of engineering at Cisco Systems. Steckelberg was controller and then CFO of the company’s WebEx division from 2006 to 2010 before taking on the top finance role for Cisco’s consumer segment.
In between Cisco and Zoom she served as finance chief and then CEO of Zoosk, an online dating site that also offers a popular dating app. Steckelberg spoke with CFO on Wednesday about her professional challenges and opportunities, past and present.
Zoom’s team and revenue are much larger than Zoosk’s, and it was a chance to work with Eric again. With that plus the long-term potential of this company, it was too great of an opportunity to pass up. Last year our user base grew by 150% and our revenue by 100%, and we’re forecasting a similar growth pace for this year.
The technology and video capabilities at Zoom are very advanced. As opposed to the legacy vendors in this space, who are still clearly the leaders, Zoom’s product was built from the ground up as a video product.
WebEx was created as a content-sharing platform focused on sharing PowerPoints and desktop environments, etc., and video came later. There are very different architectural needs for running a high-quality, stable video stream. If the video keeps freezing and jumping around, it’s distracting and makes people self-conscious. They just want to turn it off.
We’re very focused on growing and taking market share. So the challenge this year is ensuring that the organization and its systems can keep scaling.
HR is part of my organization. We ended our fiscal year in January with 950 employees. We’re projecting to end this fiscal year with 1,600 to 1,700. That’s a lot of people to hire, and it’s really hard to hire today. But when your growth model depends on adding a certain number of sales reps and business development reps, which means you have to grow your HR and finance teams as well, there’s no choice.
Our culture is built around making customers and employees happy. Approximately 60% of our current hires today come from internal employee referrals. We pay a small referral bonus, but this is a place that our people are really excited about, and they share that with their friends. [Zoom ranks fifth on Glassdoor’s current “Best Places to Work” list among U.S. small and medium businesses.]
We don’t use external recruiters at all. We have internal recruiters, we do job fairs and career fairs, and we have some advertising on LinkedIn.
Managing facilities to ensure we can house all the new people is a big one. As to our systems, we recently implemented NetSuite’s ERP and Workday on the HR side. Now we’re starting to expand into automation of finance processes like procure-to-pay and order-to-cash. All of our systems and processes have to be able to scale up along with our revenue and employee base.
Part of our growth and market-share [goals] is that within the last year we added an enterprise sales organization that’s selling into Fortune 100-type companies. Zoom has been focused more on small and midsize businesses.
Enterprises require a different level of support for contract negotiation and security, for example. We have to make sure we have the right talent and level of sophistication to deal with those customers.
Another big strategic initiative for us this year is international growth. Today we have two offices outside the U.S., in London and Australia. We expect to add three more this year. That’s a big challenge for my team, in terms of the back-office operations, making sure we’re compliant in those locations, and managing how people in those offices will get paid. There’s also the cultural piece: making sure those employees feel connected back to headquarters and part of the Zoom family.
In early 2014 we filed to go public, but that was just when market sentiment was dramatically shifting from being focused on growth at any cost to growth with profitability attached. That sentiment shifted more quickly than we could shift our business model, and we ended up not proceeding with going public.
At the end of that year, the company’s founders decided to step down and the board offered me the opportunity to become the CEO. I enjoyed getting deeper into the organization, seeing how engineering and product marketing worked together, and aligning our road map to profitability.
Unfortunately we had to do some pretty dramatic reorganizations. When I took over we had 210 employees, and we went down to 85 at one point. We also cut our marketing spend substantially.
Those were hard decisions. But we needed to get the product and marketing teams back to basics, and we did it. I’m happy to say that by the time I left, we had paid off all of our pretty substantial debt and had cash in the bank.
There were aspects of our product that were making money but causing great customer dissatisfaction. That led to a lot of churn. We eliminated those things and started focusing more on customer retention and success. Everything about the product became healthier.
We also launched [an iOS dating app called Lively] that is still alive and well. So even as we were focused on trimming costs, we were still innovating.
There are certainly opportunities for more women in tech. I spend a lot of my own time trying to mentor high school and college-age girls, helping them think about their careers.
Many of my friends who had tremendous talent decided at some point to opt out of working to take care of their children. As an employer, we need to provide solutions so women don’t feel like they have to make a choice between their family and their career.
To women who are coming into the work force today, I say that life and work are never in balance. Sometimes work takes priority, sometimes life takes priority.
But while we have to help our employees, our employees also have to be thoughtful about what we can do to help them, to tell us what they need. Is it part-time work? Extended leave? Flexible hours? Working at home? I don’t think there’s a silver bullet.