In this series, Leader Board, we speak with CEOs, managers, founders and others who lead organizations to learn what makes them tick, what they look for in new hires and even where they eat lunch.
After he graduated from college and moved to New York City to take a position in finance, John Kobs was desperate to find an apartment rental. In fact, he’d only left himself one day to lock one down.
Having the “worst 24-hour apartment search in history,” Kobs was introduced to Craigslist for the first time, which led him to being the target of scams, getting bait-and-switched and even running into people who were squatting in Manhattan apartments.
Motivated by his struggles to find a New York City apartment and by his experience as a landlord in his Ohio hometown, Kobs sought a solution to the crazy industry with his creation of Apartment List. Launched in 2011, Apartment List is a platform that connects renters with listings, working with both renters and brokers during every step of the way.
Of course, running a business always comes with its own set of challenges. To get to the place Apartment List is today, with 104 employees and on its way to more than doubling its annual revenue, Kobs and his co-founders had to take a step back.
When they launched Apartment List in 2011, they partnered with other online rental companies such as Apartments.com, Apartment Finder, Move.com and others, in order to aggregate all of their inventories under one site. “Our original business model was essentially a Kayak for apartments — a way to search many rental sites simultaneously,” Kobs says.
After bootstrapping their way to a $17-million-a-year business, Kobs and his co-founders realized that working with so many partners had its constraints. While these rental sites geared towards landlords, brokers and property managers, after his own nightmarish experience as a renter in New York City, Kobs wanted to focus on the renter’s experience. And to do so, Apartment List needed to start over and create an entirely new business model.
Mistakes were made, from hiring too many employees too quickly to even parting ways with a co-founder. While the turnaround brought its own set of challenges, Kobs says it was necessary to solve a problem. “We eventually decided on a ‘pay-per-move-in’ model where we were only paid upon successful transactions, ultimately aligning incentives and allowing us to build the extraordinary rental experience,” he said.
With the support of investors, mentors and their board, it wasn’t until 2015 that things started looking up for Apartment List. Today, more than 3 million units are advertised on Apartment List — 8 percent of all rentals in the U.S., according to Kobs. In the last six months, the company has increased its headcount from 63 to 104 employees.
From resilience to goal setting to teamwork — there’s much to learn from Kobs, and we caught with him to find out how he successfully leads a growing company.
On the most important leadership traits:
“Tenacity, resilience and a tremendous work ethic. Tenacity because you have to set your goals extraordinarily high and never stop trying to achieve those goals. Resilience because we’re constantly going to be faced with adversity and obstacles, and we’re not measured by how we perform when all the charts are up and to the right — we’re measured by how we perform when we’re facing the darkest adversity. And work ethic because there’s no traffic jams along the extra mile.”
On leadership style:
“My leadership style [aligns] around a common goal and vision. It starts with the vision of the company, and then in line with that vision falls broad-reaching goals and then subgoals. I’m very goal- and results-oriented.
“I tend to be extremely hands-off with my teammates. So I set an inspiring vision for the company, but also want to enable my teammates to be successful and grow. So wherever they need my help I’m happy to jump in. When they don’t need my help, I’m happy to be hands off. But making sure that everybody has a north star that [they’re] working [towards] is very critical. And once you have that and you have the right personnel, the rest falls in line.”
On habits that help him lead:
“Writing down what my one goal is each day — [the] one thing I want to knock out of the park. I think leaders tend to get overwhelmed trying to do too many things. By virtue of that, you’re actually not focused. So being able to focus is incredibly important.
“Ruthlessly prioritizing is also very important. There are lots of shiny objects along the way of building a business — there are lots of shiny nickels, dimes, pennies, quarters, but you need to walk past those to pick up the $100 bill. We try to be very judicious [about] what makes it into our queue of focus.”
“Keeping up with Silicon Valley is a big challenge. You kind of have a ‘keeping up with the Joneses’ dynamic. There are a lot of companies that have billions and billions of dollars in capital, and we’re a small startup with 104 people trying to keep up the same amenities and perks that much larger organizations have. And trying to recruit vs. those organizations.”
On the toughest business decision:
“I think the most difficult business decision we ever made was sacrificing a $17 million annual revenue business to start over, with no promise that it was going to work out — just a gut feeling. [In 2013], my co-founder Chris Erickson and I took the risk to completely change our method for generating revenue to ultimately provide a better experience for the renter. Even though we had $17 million in revenue and had just raised our series A, we were testing new business models and made significant mistakes along the way. In the interest of preserving our runway, we decided to lay off 20 percent of our team — one of my saddest days as an entrepreneur. We eventually decided on a ‘pay-per-move-in’ model where we were only paid upon successful transactions, ultimately aligning incentives and allowing us to build the extraordinary rental experience we have today.”
On the most important traits in a new hire:
“Resilience. I think that is the most important trait because at this stage of [the] company’s life cycle, we’re still going to be engaged in uncertainty, obstacles and undefined paths. We tend to attract people that are risk-takers, that are competitors, that are relentless. Resilience stands out because that’s [a] piece of the fire — how do you react when everything is on the line?”
On recognizing employees:
“We actually allow anyone at the company to nominate [someone] for an award. We call them shoutouts. We have our all-hands company meeting every week, and at the meeting we dedicate time [for] peers, managers [and] subordinates [to] give shoutouts to [people] that have had exceptional performance. It’s very meaningful when it comes from somebody and it’s spoken in front of the entire company.”
“We actually just returned from our first-ever camping trip. We took the entire company to a place near Mendocino called Camp Navarro. Another event that everybody looks forward to is our annual ski trip to Squaw in Tahoe. We take the entire company, rent out a bunch of villas and spend some time on the slopes with teammates.
“We also have something I call ‘Family Fridays,’ where on the last Friday of every month we randomly select small groups of four to six people to eat lunch together. So you’re able to grab lunch with somebody you might not have spent much time with otherwise. Putting people in situations that are a little bit out of their comfort zone leads to amazing connections across the organization.”
On unique office rituals:
“I grew up playing sports and we had something we called ‘bulletin board material,’ and whenever somebody from an opposing team said something about you in a negative light, you use that as fuel. So for the longest time, I had bulletin board material up — [but] that bulletin board now says, ‘Be relentless.’ I think it’s important to remind yourself of what got you to where you [are].”
On managing meetings:
“In the beginning of [a] meeting, I like to set out exactly what the goals are and what the agenda is. There’s usually pre-work involved with meetings to make sure that everybody comes to the meeting prepared and knows what to be focused on. Just because a meeting is scheduled for an hour doesn’t mean it needs to go an hour.”
“I’m addicted to Google calendar. I am constantly writing notes to myself in an app called Captio, which is an easy way to seamlessly email yourself ideas. And then I’ll typically use my inbox to prioritize. I like to get to inbox zero multiple times per week. I typically work anywhere from 7 in the morning to 7 at night and then I do a lot of after hours and work on the weekends.”
On office setup:
“I have a giant glass wall so everybody can see what I’m doing at all times, which I think is really important for transparency. I’ve got my desk, which is a standing desk that converts to a seated desk, and then I have a glass table that’s used as a conference table with a giant TV for presenting. So anytime we’re doing something it’s really optimized for either one-on-one time or for a group meetings.”
“I usually eat with the team. We do catered lunch, which is very nice because it gives more opportunities for teams to collaborate.”
On a strong company culture:
“I would say making an impact and succeeding together are two of the very common DNA strands that we all have at Apartment List. For succeeding together — putting the vision and goals of the company out of our personal goal[s] is a pathway to success. We tend to attract people with a team-first attitude.
“Another piece of our culture and identity [is] making an impact. [We] are empowered by the big monumental task in front of us, which is helping people find their home. Typically, your largest expense is spent on rent or real estate, so we take that with immense responsibility.”
On cultural mistakes:
“Folks that lack transparency are making a big mistake. Sometimes there are situations where things are not going the way you planned. That’s very ominous because you’re supposed to have the answers. At least that’s how it feels. A lot of entrepreneurs will shield their employees from those mistakes. [But] I’ve found it’s very much supportive of an environment to share those challenges with team members because you’re all in [it] together.”
On his biggest cultural win:
“Our ability to attract the most talented people. We’ve been able to grow super fast but I would sacrifice that growth to keep the hiring bar high. The foundational building block of a great culture is having great people. For us, that is attracting amazing folks [and] retaining them. We’ve only had one voluntary termination all year — for a company of 104 people to have nobody quit is a pretty tremendous statistic that I’m very proud of.”
On his role models:
“One of the leaders that I always look up to is Vince Lombardi. He was a football coach for the Green Bay Packers and he won the first two Super Bowls in history. Vince set a tone of excellence and built a culture of winning that we rarely see in a world where everybody gets a trophy. Where I was born and where I come from, there’s one winner. ‘Winning isn’t everything, it’s the only thing,’ was one of his famous quotes.”
On his favorite leadership books:
“The X Factor by George Plimpton. The X-Factor talks about [how] there’s something that’s non-tangible that makes people successful and most people just don’t ever find it. So it’s this mentality that you’re unbreakable or that you can’t be beat as long as you keep getting up and fighting the good fight.”
On where most leaders go wrong:
“Trying to do everything yourself. Entrepreneurs feel the intense desire to have their hands in everything and own everything but when you think about the best and brightest people that you work with, they don’t want to work for someone like that. They want to control their own destiny.
“It’s very important for us to hit the reset button on our own expectations of what our company can be. When you’re talking, you’re not listening, and listening to the people you surround yourself with is what helps create evolution. I’m a big believer that entrepreneurs should constantly be resetting their own expectations of what they can achieve.”