15Five raises $1M for a management tool inspired by Patagonia's founder
In companies like in relationships, communication is key. But, the larger an organization gets, the more difficult it can be to maintain healthy communication channels throughout. This realization, and regular outdoor adventures that took him out of the office, led Patagonia founder Yvon Chouinard to invent weekly reporting system that is meant to take no more than 15 minutes to fill out and five minutes to read.
The simple yet powerful concept recently made its way into a startup called 15Five, which demoed its SaaS product at this year’s Launch conference in March and shed its beta label in August. Today, the company is announcing $1 million in Seed financing led by Richmond Global, with participation from 500 Startups, Yammer founder David Sacks, USTREAM founder John Ham, Mahalo and LAUNCH founder Jason Calacanis, #DOMINATEFUND, Xobni founder Matt Brezina, and Badoo COO Ben Ling. Interestingly, Sacks reportedly committed to investing while on-stage as a judge at Launch.
The goal of 15Five is to help management capture regular (typically weekly) snapshots of their team’s progress. Each 15Five survey contains customized questions chosen by a company’s management. Depending on the size of an organization, middle management can review and comment on each, before aggregating and forwarding the highlights to senior executives. This was the method reportedly employed by Patagonia’s Chouinard.
The platform allows managers to flag and escalate issues or comments within each employee report, with a single click, thereby including it on their report to higher ups. Employees get email notifications each time their superiors comment on one of their 15Five responses. The service costs $49 per month for 10 users and $5 per user thereafter.
The thing with management tricks like this is that they work for some, and not for others. But once executives find one that works, they tend to be fiercely loyal. The company already counts as customers GlaxoSmithKlein, TaskRabbit, Warby Parker, USTREAM, and Mahalo, among others. Many current 15Five users have reportedly migrated over from former competitor ThinkFuse, which was acquired by Salesforce in July, and whose product was subsequently shuttered.
Prior to its latest funding, 15Five raised $200,000 from “friends and family.” Its latest list of investors adds some credibility and Silicon Valley muscle to the young company. One of the more surprising inclusions is Ben Parr’s #DOMINATEFUND – yes, it has a hashtag in its name – which has a celebrity influence driven thesis. This company seems about the furthest thing from one that could benefit from Tweets by a rapper or actress. 15Five CEO David Hassell defended the firm’s value, saying, "Their entire team has great PR experience and connections and has already been tremendously valuable and engaged in helping us in that area." I won’t claim to get it, but the rest of the round was comprised of legitimate enterprise credibility, so it won’t make or break their success.
Boiling it down, however, and the initial version of 15Five seems more like a feature than a stand-alone product. The company has gotten some positive early buzz, and certainly has room to add to its existing offering and continue this momentum. The next logical step is to integrate into other cloud communication and management tools like Sachs’ Yammer, or others such as Asana. But that’s the thing, a reporting solution like this seems destined to be built into a broader communication platform, rather than existing as a standalone offering.
Eventually, most companies grow past the point where having weekly 1-on-1’s with each employee is feasible. (To Sarah Lacy’s frustration, PandoDaily crossed that threshold months ago.) In a world of solutions looking for a problem, at least 15Five actually offers a simple, next-best-thing option to this real problem.