Chad Dickerson has kept Etsy alive. Can he ensure the company lives for fifty years?
Before Chad Dickerson even walked into his first day of work as Chief Technology Officer of Etsy, he'd been sent a list of demands from users. It opened with instructions to take a painkiller before reading. In other words, Etsy's site was a technological mess.
It crashed, and there was no way to inform users of the crash. In fact, there was no monitoring system to even know if there was a crash. There was no mobile app, no site optimization; the check-out tools for buyers and uploading tools for sellers rudimentary. The site's load time was arduously slow. Oh and it broke each time new code was pushed.
Meanwhile the venture community was battening down the hatches (evidenced in Sequoia's famous RIP Good Times presentation) to survive the economic crisis of 2008 -- Lehman Brothers had just crashed. Dickerson had just packed up his life in San Francisco, was sleeping on an air mattress in Brooklyn. Across the river, the world was falling apart, and the company he'd moved to New York to join was a mess.
On the balance sheet, Etsy looked good. Sales were growing, despite the shortcomings of the site. Sales were growing, despite the well-documented management turmoil that caused it to cycle through three CEOs. The only other large startup to do that and survive is Twitter -- a company that's often compared to a cockroach or weed. It just won't die.
Dickerson said his first 18 months as a CTO of the company felt like each day the company might die. It's been kept alive -- externally, at least -- by the passion of the seller community. Internally it was kept alive by Dickerson's ability to remain strangely calm in times of crisis. Slowly but surely, he worked through the site's technological disasters. Admittedly not a great coder himself, he said it was often a simple solution that helped Etsy's site, which was over-engineered in some places. "One of the good things of not being a very good technologist is that you can only do simple things," he said at PandoMonthly last night in New York. “My lack of sophistication in that sense was probably a benefit.” Meanwhile, he built Etsy's engineering time in the style of a West coast engineering team he worked on at Yahoo, only in New York.
The management issues took a bit longer to work out. As documented in what could be characterized as a devastating profile in Inc. magazine, Etsy's eccentric founder Rob Kalin outgrew his role in the company as Etsy scaled up. He was eventually asked to leave the company and his replacement didn't work out either. It didn't immediately occur to Dickerson that he'd be right for the role, but he warmed to the idea quickly.
“I was there, and saw all of this stuff happen. I believed in what Rob sold me on at the time, and I still believe in it, so I was able to do two things," he explained on stage. "I was able to observe all of the mistakes that led to the changes up close and learn from those, and also by the time I was asked to be CEO, I had a long list of things I wanted to do at Etsy.
“More than any company I’ve been involved in... What Etsy really needed was someone who really understood and came from the inside, not someone who came in from the outside and tried to “optimize” it," he said.
So he took the job. Since then Etsy has managed to not only continue its growth, as an eight-year-old company, but Dickerson has managed to accelerate the rate of growth, which is fairly rare for a company of its age. Last night the company announced it did $895.1 million in gross merchandizing sales in 2012, a 71 percent increase over the year prior. What he once worried was a career ending decision has wound up vaunting him far above anything he did in a prior life organizing hackathons at Yahoo or selling mugs online for Salon.com.
Etsy isn't out of the clear -- Dickerson always worries about attracting new talent and keeping talent happy. He also needs to continually bring in new buyers to keep the marketplace liquid. People still complain that if you look at actual revenues, not gross merchandize sales, the company is wildly overvalued.
That's why he made the company into a certified B Corp. And why, when Etsy's investors want an exit, the company won't go through your traditional IPO route. Etsy hired Kristina Salen, head of Fidelity Investments’ media, Internet and telco group, as its CTO. Dickerson noted that the non-traditional share offering events of companies like SurveyMonkey and Boston Beer Company seemed best suited to Etsy.
That's the way he sees the eight-year-old Etsy that barely survived making it to fifty years.
To watch the interview in its entirety, click here.
[Image via Etsy seller NightDoveDesigns]