Q&A with Gerald Brady, Managing Director, SVB Network at SVB Financial Group

By February 16, 2018 ScaleUp

Q&A with Gerald Brady, Managing Director, SVB Network at SVB Financial Group

#Topic: Scaling Culture — Target Team Lead

I have an unusual background for someone who will talk about banking culture in SVB. My entire career had been spent in technology and technology focused companies. I have been very fortunate to be in startups. I was with DDnet which was one of the first commercial internet companies back in 1995. Then I joined Yahoo followed by a venture capital firm called 3i in London. It was when I moved to the States in 2000 and went to study Leading Organizational Change in Culture at Standford University that it became clear to me that the companies that are enduring had built an exceptional culture.

As an investor, it is interesting for me to think about “why is culture an afterthought?”. For 20 years I have gone through observations of what works and what doesn’t work. I have never seen such a clear articulation of culture as when I joined Silicon Valley Bank.

About Silicon Valley Bank:

· 35 years in operation

· Serving innovation around the world with offices in the US, UK, Israel and China

· Clients include 50% of all VC-backed tech and life science companies in the U.S.

· SVB is the bank to 70% of the US venture capital market

· $3.5bn SVB Capital Fund of Funds /Direct Funds

SVB Corporate Overview

– Currently focused on Innovation Economy

1. Hardware & Infrastructure

2. Software & internet

3. Life Science & Healthcare

4. Energy and Resource Innovation

5. Private Equity & venture Capital

6. Premium Wine

– Helping high-growth companies navigate at every stage :

Our Clients:

50% of all venture capital-backed tech and life cycle companies in the US

57% of US venture capital-backed companies with an IPO in the first half of 2015

We Deliver best-fit financial solutions, insights, and connections no matter where you are on the journey :

1. Starting Up

2. Gaining Traction

3. Building for Scale

4. Private Equity and Venture Capital

5. Building Culture in the Organization

What is Culture?

The culture is set on day one, no matter what the size of the company is. People fail to acknowledge that they are building the culture from the moment they set cultural norms like having a glass of wine every Friday or games on Tuesdays. How you hire and who you hire and where, forms part of the culture early on.

There are many definitions of culture out there but I think one of the best definition of what culture is “how things get done around here are the cultural values and the cultural norms”.

Why Culture matters?

Two of the best examples of why culture matters in an organisation can be derived from the slides of the Netflix Culture deck : https://www.slideshare.net/BarbaraGill3/netflix-culture-deck and Tony Hsieh, CEO of Zappos’ presentation about when he founded Zappos and where he specifically talked about setting the culture from the start.

SVB’s Secret Sauce?

– Culture

SVB’s Mission ?

– To help entrepreneurs be successful

Thoughts to ponder about Culture:

1. Obsess about your culture

2. Culture gets set from the top

3. Don’t settle when you hire

4. Live your values

5. Everyone in the organization is involved

Key Question 1

How would you onboard a new employee in order to expose him to the company culture?

Bear in mind that as they go through the recruitment process, you are already exposing them to the organization’s culture. When hiring, you don’t need to necessarily want to hire people who are going to fit your culture. You want to hire people who are going to be adaptable to culture. You need to talk about the cultural values, and cultural norms but you also want them to be excited about the mission of the organization. People today wants to be excited and motivated that they are working on something important. As you are selling the organization, you are also selling a little bit of the culture. You can also set up a new employee orientation program and have the CEO meet and welcome the new employees. Meeting the CEO even for a brief moment can matter so much to new employees as it sets the tone that the CEO cares for its employees.

Key Question 2

Do you use any type of culture value test when you recruit and if so which ones?

We don’t do cultural value tests. What we do is to look for a variety of skill based assessments in our interview questions and then we try to understand how people deal with certain situations. For example, we will ask people to describe a difficult work situation and how they dealt with it. We will also ask them to talk about what is important to them in the workplace, are they a team player and situations that they didn’t enjoy and the reason why they didn’t enjoy it. We are looking for people who scored off the charts in terms of relationship skills. Tests might not be the right way to do it so we don’t do test tools. Think about the values that you’re looking for. Think about the questions that you could ask that will give you a much better response to what you’re looking for.

How many interviews will you have in one process with one candidate?

I would say we are trying to get better at it. At minimal, people would vie for an associate position and we’ll do six 30 minute — interviews. They will meet several people. It’s a group process where they will meet with another associate, a managing director and maybe even a board member. It doesn’t have to be a unanimous “yes”. If we have reservations about this person, we might ask them to come back in and ask more detailed questions like what are their motivators to come join us. We look for those who have come prepared.

Do you think it is easier to establish culture in the U.S. where you can hire and fire more easily that in European countries? Netflix is an example with their vacation policy or lack of.

You have cultural norms to go back to that. In banking, we are a pretty boring institution so we dropped having a vacation policy. In markets like Germany, France or the UK, they have a different view around vacation. In the States, that’s a material thing to say to take the time off if you need it. There’s no guideline if you don’t want to take a vacation but we expect people to go away and have a break.. There are various ways you could do to say it’s not a vacation policy but it’s something we trust on people. It’s just different ways of dealing with the same topic.

Key Question 3

What is the role and value of having transparancy inside as part of culture in the workplace?

It’s incredibly important to have a transparent culture. If you’re secretive and don’t share information or only a handful of people gets information, it gets known very quickly. If you’re a small organization and you’re not transparent, it’s blatantly clear. I think transparency is a little bit about trust. At the end of the day, you trust your people with information. You don’t have to make them insiders, you just want to tell them what is going on. When things are going well, people don’t talk much about culture. It’s when you hit a bump in the road that transparancy matters and how you deal with that.

What does transparency mean to you? Is it telling everything or only telling when they ask you? Are there things you want to tell your employees? If they request for information, is it open for them?

I have a friend who is a CEO and he has told me twice now that the most important thing to do if you’re going to be a CEO is to be transparent with your employees and build a trusting relationship. Don’t wait to be asked. If they’re asking, they’re asking for obvious reasons. If you have information that you think will be meaningful, find the time to tell them. Tell everyone the same story and don’t tell people a different story. Soon as you tell one person, they’re all going to know eventually so tell everyone instead. I think there’s a massive difference in the organizations that are transparent than a secretive place. It’s ultimately the trust you have in your people.

Key Question 4

How do you scale up when you get to that level where a growing tribe can still maintain a stable relationship in the community and not form little groups?

It will get more complex when you start having multiple locations in multiple geographies. You can try to find excuses to get people together. Just spending time with each other matters. Find an excuse to break down barriers. There’s a travel company in Scotland that moved people every six months into different parts of the office so no groups sat in the same location for more than six months. They broke down groups and I think it was a brilliant idea. Another one is, in our organization. No one has an office in our bank. We have taken all of the walls down and there are no set desk for people in the bank. People can sit anywhere and move around. We want to have people to have what we call accidental collisions. You may have to deal with corporate antibodies, people who repel colleagues. If they’re not going to play nice in the sandbox, they may not be a great fit and you will have to make decisions around that. You definitely will want to avoid factionalism with the tribalism that can happen.

Key Question 5

Do you have any tips or advice on how to deal with different cultures if you happen to be in a structure where your initial shareholders do not share the same cultural impact to try and bring it on to the team?

In reality you are managing up. You’re going to have to educate your investors about why culture matters, why you’re doing certain things and why it is important to the organization. In most cases, the CEO’s are more sophisticated on this stuff than investors are. Make it in a language they are going to understand like “they are going to make more money because of your company’s culture”. Tell them the best companies are the ones with the best culture. Investors are pretty easy to explain that to because at the end of the day, that coin operated. Relate it back to the language they understand.

Key Question 6

How can we detect people who are the incorporation of the values we are looking for? Do we measure their success and from that we get the values by asking everyone?

I would look around everyone in your organization and not just your successful people because some of your successful people are actually part of the problem and not part of the solution. Another thing is to think about the things you aspire for. For example, inclusion and diversity which are incredibly important. You may want to talk about why diversity matters or why inclusion matters in your organization. Do they feel valued? Do they feel like being treated equally? Do they feel like they have barriers to being promoted? You’ll want role models in your organization to make people understand how they can be successful too.

How can we find the right role model? I’m afraid to pick the wrong ones.

Sometimes that happens, right? You see people who don’t deserve the promotion, or they cut corners and do things and still they are successful. There are people who will say “She’s always done it like that”. You don’t want to necessarily have people mirror those behaviors. So think about what you aspire for and how you respond to it, then we make that a cultural norm.