Do the Right Thing: A Conversation with BambooHR Co-Founders, Ryan Sanders and Ben Peterson
In the software startup world—an environment well-known for its fundraising braggarts, cutthroat competition, and hypergrowth obsession—it’s rare and refreshing to find leaders who have instead put people first in their effort to create a successful company. Meet Ryan Sanders and Ben Peterson, co-founders of BambooHR.
In 2019, after 11 years at the helm, Ben and Ryan found a trusted partner in former executive vice president and general manager of Adobe, Brad Rencher, and invited him to become the new CEO of BambooHR.
For a recent episode of the BambooHR podcast, The Era, Brad turned the tables and invited Ben and Ryan in for an interview; in it, they answer questions about the BambooHR company values, their experience leading a company based on employee experience, and how they feel their strategy of focusing on values from day one contributed to business success.
Find more insight on this topic by listening and subscribing to BambooHR’s podcast, The Era.
BambooHR Company Values:
- Grow from Good to Great
- Assume the Best
- Do the Right Thing
- Lead from Where You Are
- Make it Count
- Enjoy Quality of Life
- Be Open
Brad: Were you surprised that focusing on creating a great place to work resulted in such a successful business?
Ben: There’s this connotation with the word “surprised” that implies it happened overnight. I like to say that we’re a 13-year overnight success. I think I mostly just feel gratitude. To us, success means learning and growing alongside people you love. It took a lot of time, work, experimenting, and improving to create that opportunity for ourselves and for others. Are we pleased? Of course. But we’re mostly just grateful for the opportunity to work with such wonderful people.
Ryan: We felt like there was an opportunity because of the lack of great solutions in the HR space for small and medium-sized businesses, but we also saw an opportunity to build a place where we would want to work—a place where people could come and do their best work. A place where it was exciting, where it was hard, where you could stretch and grow constantly, and where you could do it with people you enjoy working with. I think the thing I get most excited about is the outsized impact of that unified effort together. Normal people working hard who are aligned together can really do great things.
Brad: You were really intentional about the values you created for BambooHR. What’s the story behind “Do the Right Thing”?
Ryan: “Do the Right Thing” feels like it should be pretty obvious—it’s something that everyone in business should ascribe to. Yet there are failures over and over where people are focused on the wrong thing. Then, when hard decisions come along, it becomes really easy to make a poor choice: a choice in favor of the dollar or a choice at the expense of the customer or employee.
“Do the Right Thing” was intended from the beginning to espouse that broader idea that you don’t just go into business to make a dollar, but more importantly to win the hearts and minds of customers and employees. So, we hold up our choices and strategy against that value, and time after time over the course of building BambooHR, there’s been an opportunity to ask, “What is best for BambooHR?” which has really meant, “What is best for the customer?” or, “What is best for the employee?” It’s not a decision like, “Should we dump radioactive material into the ocean?” because that doesn’t apply to our space. Instead, it’s been decisions about how we take care of employees during a pandemic, how we think about business growth, and how we support each other during difficult times.
Brad: What are some of the ethical issues you thought about as you built BambooHR?
Ben: Sometimes when we talk about values or ethics, it can feel kind of cliche: “Culture matters. We care about people. Do the right thing.” But those things are just the surface. It’s important to provide clarity about what those words actually mean.
A couple of years ago, we were invited to speak about culture at a Great Place to Work event. I did so much research on company culture, and as I read all the definitions, I began to feel that culture is really a proxy word for values. I came to the conclusion that culture is how we treat people in the workplace. Having concern and respect for others has to be genuine and not just lip service. If you truly care, you have to show it. Accountability is another big concern that we talk about all the time—we have to embrace it. Embracing accountability is how we grow. Having a set of ethics matters in business, but it has to be more than just making announcements or putting values on a wall. When you actually practice the good ethics you preach, it creates a huge lift.
Brad: When it comes to right and wrong, what is the role of leaders? Do company leaders have a moral responsibility to employees?
Ryan: I think there are two foundational things that are really important for employees at any organization to know:
- Does their leader care about them as a human being prior to caring about anything related to their performance?
- What is the next thing that will help them progress?
If I could walk up to anyone at BambooHR and get an answer to those questions, that would be my dream. The answers to those questions signal whether their leaders actually care about them or just view employees as a cog in the wheel. We have to realize that real people have real challenges and successes outside of the workplace.
When people feel cared for, they are better teammates. It’s humans who make things happen, so we should care about each other as humans. We’re with our coworkers for a huge portion of the day and the things that happen at work impact us when we go home. So being cared about at work makes a world of difference. It also unlocks all kinds of performance goodness.
Next, if I know what I can work on or what the thing is I’m doing or not doing that’s getting in the way of success, then I can start working on that and feel progress. People need to feel like they’re contributing and providing real value.
At a previous company, I worked for Ben. There was one day where I was working really hard on something, and the next day there was a little Post-It note on my computer in Ben’s chicken-scratch handwriting that just said, “Thank you.” I still have that Post-It note because it meant so much to me that he acknowledged what I did was hard and meaningful and that he actually cared about it. I hope we’re thoughtful about those things at BambooHR, and I hope all leaders think about those small things.
Moral responsibility has a heaviness to it. Candidly, I don’t think there’s room in the workplace to not care about the human and recognize that there is a complete person there, not just the work they do. I also think there’s a responsibility to have good communication around expectations because sometimes, when there’s craziness in life, people need a place where they can be successful.
Brad: What’s the story behind having birthdays off?
Ryan: Having birthdays off is one of my favorite benefits. The idea actually came from my mom. She worked at a doctor’s office where they had their birthdays off. It’s interesting that we love our birthdays as kids, but it’s expected to just be any other day as an adult. Giving employees birthdays off is us trying to add some meaning and delight back into the day. We’re really intentional about how we set it up: it’s specifically on your birthday (not just a random day you can take at any point) to commemorate the day you were born.
My first time taking my birthday off, my wife said, “What are you going to do?” And I said, “I don’t know. I’m going to do whatever.” So I just had a leisurely morning and ate some breakfast. I watched a movie. It was like playing hooky—just like old times staying home from school and doing something fun. It was magic. Every birthday since then, I’ve looked forward to it. It’s so fun infusing a little bit of magic and delight into a day that has become so ordinary.
Brad: Tell us the story of the founders-to-CEO transition that BambooHR is currently going through.
Ben: What are the biggest decisions founders could make? Selling? Raising money? No. It’s key hires, like hiring a CEO. It’s so strange to think about getting out of the driver’s seat and hiring someone else to do it. We decided it was time because one of our guiding principles is “What’s best for BambooHR?”
The reality is that we’ve been turning over control since our very first hire. It’s fun and exciting to find someone who can do something better than you can. We love bringing new people in to add value and grow with us. I’ve said all along that I’d be willing to hand over the CEO role as soon as we found someone who could do it better than me. All along the way, we’ve been willing to find the best people.
So we started inviting people to breakfast, and we met some people who were incredible, but that just weren’t the best fit for BambooHR. Then we met with Brad, and afterwards as I was driving home I called Ryan and asked him, “What do you think?” and Ryan said, “Well, I think it’s worth another breakfast.” So we just took it one breakfast at a time and really got to know each other. It was so important for us to find someone who could help us grow the right way.
I also remember being on the phone with Brad while he was getting headhunted like crazy, and he was in this really fortunate position to be able to pick where he went. He told me something that really clicked in my mind; he said, “I want to build something. That’s my love language.” After getting probably some incredible offers, I can imagine, he’d realized that money wasn’t as important to him as building something meaningful. That was just one of the key things that validated that Brad was the right choice to become our CEO.
Brad: During our interview process, why did we talk more about values than we did about product?
Ryan: When you’re facing the idea of handing your company off to someone else, values are the most important thing to have aligned. If those are misaligned, it’s a full stop. Our intent wasn’t just to hand the company to a caretaker; we wanted someone who would add to and amplify BambooHR. That wouldn’t work if our core values weren’t aligned. But if we were aligned there, then the conversations about product and marketing and our market and customer could be more exciting.
Ben and I care so deeply about the team and our customers, and we see so much more potential in front of us. Alignment was essential so that we could have full confidence that Brad was an additive. In investing, you talk about accretive investments. This needed to be an accretive relationship.
Brad: You guys have done things differently without sacrificing success. What’s your philosophy on spending and funding?
Ben: The reality of entrepreneurship isn’t like being on Shark Tank. The whitepapers and popular thinking or teaching in business school might be saying, “Go raise a bunch of money. Grow as fast as you can. Sacrifice profitability for growth because growth is what matters.” But sometimes we need to stop and ask, “Why?” We’re big fans of the saying, “Best principles, not best practices.” We try to challenge everything and ensure we’re making the right principle-based decisions.
Does it make sense for people to raise money? Sometimes, definitely. But it didn’t make sense for us. It was painful, but we didn’t want to give up control. Could we have grown faster and looked like we made more money? Sure. But we wouldn’t be where we are today. Because our mindset wasn’t around an IPO, we were able to focus on having an exceptional product that we care about while also enjoying quality of life along the way. I think that focus is the reason we’ve found success.
Funding is a huge decision. If you make a poor choice, it creates problems and drag that founders often don’t think about. That eats up your time, and you can end up paying a heavy price for it. So before you decide whether funding is the right choice, really dive in and ask, “Why? What? When? And how much?”
Brad: What’s an example of that business philosophy impacting your culture, values, and benefits?
Ryan: Sometimes there are core decisions we make early on in business and in life that set us up for success long term. When we were bootstrapping our business for the first three years, we weren’t taking a paycheck and were living off of our savings. My wife was literally doing extreme couponing from the get-go. There was one time where she got 120 dollars’ worth of groceries for 75 cents. She was in it with me and was being really thoughtful about the dollars going out because they weren’t coming in.
One of the benefits that we offer is Financial Peace University—it’s a Dave Ramsey program that teaches good, common-sense financial principles. It’s been life changing for many employees. We offer the course, and if an employee completes it, we reimburse the cost of the class and give them a 100-dollar bonus.
We’ve had wild success in the number of employees who complete the program and have gained a new way to talk about household finances. Most people don’t learn those sound financial principles elsewhere. Our teammates have paid down hundreds of thousands of dollars in debt, and it feels good as an organization to purposefully influence them for good. Then they get the benefit of being able to sleep easy, plan for emergencies, and even take advantage of other benefits like 401(k) matching.
Brad: What is the most effective way to choose and focus on priorities?
Ryan: I love the idea of choosing wisely and sticking to it. I love the discipline. No matter how much money or how many teammates you have, you can never have enough time to do everything. Because of this, you have to choose the right things first. Take the information you have, decide, and then it’s all about execution.
One of my favorite authors is Greg McKeown, and in his book Essentialism he says there’s power in focusing on one thing and moving that thing forward feet and miles rather than moving a bunch of things forward by inches. In other words, don’t spread yourself thin and focus your energy in too many directions.
It’s important to acknowledge that there are going to be trade-offs. One example is that prioritizing being good financial stewards creates some constraints. As you have more success, you’ll have more opportunities to stray off in multiple directions, so the discipline of sticking to that value becomes more important.
Values should dictate your decisions. Having a priority gives you a north star to help you focus on the things that matter most. I also think there’s power in the experience of getting something across the finish line. Sometimes multi-tasking will kill your business.
Ben: Focusing is Ryan’s superpower. His ruthless prioritization and focus have been major benefits to everyone who works around him.
Brad: What are some of your favorite examples of doing the right thing in a work setting?
Ben: My favorites are those that involve peer-to-peer interactions and employees helping each other remove drag so they can run. Yes, managers have the responsibility to create accountability, but at the end of the day, we work with one another.
At BambooHR, part of the way we have a great quality of life is that we come in and do really focused work so that we can get out of here after eight hours. An employee once told Ryan they’d noticed their coworker was often surfing Facebook during work. So Ryan asked, “What are you going to do about it?” The employee said, “Me?” And Ryan said, “Yeah, you work with them. What are you going to say?” What Ryan was asking the employee to do would take a lot of courage. No one wants to hurt anyone else, but we need to help each other learn and grow. In the end, the conversation happened, and it was received really well.
Ryan: One of my favorite examples was when we’d hired someone new, and afterward we realized that we were underpaying them. We could have looked at it as getting a good deal for the company, but the right thing to do was raise their pay, so that’s what we did. We have to show up for people whether they know it or not. This goes back to integrity. Am I going to live the values whether or not someone is looking?
Brad: What are you up to now that you’re in a different phase of contribution to BambooHR?
Ben: I’m having so much fun in this phase. It’s enjoyable to have a different perspective and learn and grow. I’m grateful that I still get to be at this amazing company.
I’m doing some coaching and mentoring. I love the team and people and principles and getting to help people with critical thinking. I’m a rookie, but I’m getting to learn and grow alongside five leaders throughout BambooHR. It might sound mushy, but our company values are so real and raw. It’s just humanity. It’s rewarding to focus on building relationships, and I’m able to be involved in the strategy and decisions without being tied up in tactical stuff.
Ryan: Bringing Brad on was a huge relief for me. It gave me an opportunity to step back and look at the organization and have some perspective. I was able to ask, “What do we need?”
My first job was as a product manager, and I still get excited about the product. I like to be in the middle of the action—at the center of business needs, customer, design, and engineering. It’s fun for me to create something that starts on paper, build it, get it into the hands of a customer, and then get the feedback and iterate. Our product teams are full of really intelligent, wonderful people who come together and create amazing stuff. It’s been a delight to dive back in with them and have a narrower focus on something I love with people I love.
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