Scott Orn, CFA
Scott Orn, CFA
Posted on: 08/07/2017
Raphael Crawford-Marks of Bonusly - Podcast Summary
Raphael Crawford-Marks has built a next generation employee recognition service called Bonusly. The Service’s integration with Slack makes it quick and easy to reward co-workers for a job well done. Bonusly has become one of Kruze Consulting’s most popular tools.
Raphael Crawford-Marks of Bonusly - Podcast Transcript
| Scott Orn: | Welcome to Founders and Friends podcast with Scott Orn at Kruze Consulting. Before we get to an awesome podcast with Raphael from Bonusly, here’s a couple of shout outs; first to Kruze Consulting ourselves, we do start up accounting, 160 clients been around for five years, 25 team members and just grown a ton, we also do taxes, which is a big part of our practice, so if your startup needs taxes or just regular accounting help, give us a shout. Also shout out to Gusto who has started processing the R&D tax credit claims that we have been prepping for our clients, and Gusto is doing this across the board, so they’re doing it for free for the second quarter claims which is awesome, thank you Gusto. But basically companies, startups especially should be looking at these R&D tax credits because there’s a lot of money you can save on your payroll taxes. So that’s it for the shout outs, and now to a great podcast with Raphael from Bonusly, thanks. Welcome to Founders and Friends podcast with Scott Orn at Kruze Consulting, and my very special guest is Raphael Crawford-Marks of Bonusly, welcome Raphael. Raphael Crawford- |
| Marks: | Hey Scott, thanks for having me. |
| Scott Orn: | It’s our pleasure. So we at Kruze Consulting are huge fans of Bonusly, so I actually, we’ve been using it for a while, and it’s like, it’s totally taken on a life of its own at Kruze Consulting, so I reach out the Raphael see if he’d you be on the podcast and he agreed. SoRaphael, maybe give your quick background? Raphael Crawford- |
| Marks: | Yeah sure. So my own background is originally I am a software engineer by training, a veteran of several different startups and then co-founded Bonusly five years ago with a friend of mine, former colleague that I’d worked with at a few of these different startups, and it’s been quite a ride over the last five years. |
| Scott Orn: | I didn’t realize you guys have been doing this for five years, that’s amazing. Raphael Crawford- |
| Marks: | Yeah, I mean, we started working on it as a side project, just nights and weekends, in I guess the summer early 2012, and piloted with a few companies where we had personal connections; and then opened it up for the public to start using in early 2013. So we’ve been kind of publicly available since 2013, but we’ve been working on it since 2012. |
| Scott Orn: | And maybe, I want to go back to you working nights and weekends and talk about that a little bit; but maybe just explain what exactly Bonusly is to the audience? Raphael Crawford- |
| Marks: | Sure. Bonusly is a comprehensive platform for employee recognition rewards and growth, and so basically what it is, is a way, a software tool to enable all of your employees to give and receive timely frequent and authentic recognition, praise, positive feedback, which does |
| two things: | one it helps all of your employees feel like their contributions matter, they start to see how their work aligns with the mission and values of the company, it really improves employee engagement and retention. But then, all of that essentially crowd source performance data that you get from the team can also yield really valuable insights to leadership or to anyone else about the company as a whole and how the team is interacting and what strengths each team member is bringing to the table. |
| Scott Orn: | That’s perfect. And for us, we use it as like a peer recognition tool, so like our team can give a shout out through Bonusly to appear or maybe like someone they’re working kind of reporting to, or someone who is working for them on a given project, and basically say like hey, here’s 50 Bonusly points to Lory, or 50 Bonusly points to Alex or Scott, and it gets passed through our entire company via Slack, so you guys have a really cool integration with Slack, and that’s kind of how we found you, I think we found you in the Slack at app store; but it just works so nicely with Slack, we just tried it and it just caught on like wildfire and now every Monday morning meeting, we have like an all hands meeting, we actually put the number, the people, the four top Bonusly receivers up on the board and they get recognition in front of the whole company. So I’m a huge fan, and I love how you’ve made it so easy with Slack. Raphael Crawford- |
| Marks: | Well thank you, that’s great to hear, we love hearing stories like this from customers. Yeah, so Bonusly is primarily geared towards your use case of peer to peer recognition, though there are other forms of employee recognition and bonuses and awards that we also support. And Slack has been a huge avenue, a channel for customer acquisition for us, we integrated with Slack really early on I think in like late 2013, early 2014 when Slack was still just getting launched and wasn’t the juggernaut that it is now, and we’re one of those, the first integrations in the Slack app store; so, we’re really glad to hear that you guys found us that way. |
| Scott Orn: | How did you make that decision to integrate with them, was it just like completely opportunistic or you’ve been doing this for a while so you probably were like kind of realizing the more distribution you got the better, in the bigger the company you can get? Raphael Crawford- |
| Marks: | Yeah, it was a couple of things; I mean, because I had been working in tech and startups for so long, I remember when Slack first launched, a bunch of people who I really respected, who were kind of early adopters started talking about Slack, and the way they talked about it was just like it was this life-changing tool, and so that really piqued my attention, and then I also knew that for Bonusly to really make Bonusly as impactful as possible, we need to make it as easy to use as possible, which meant not forcing employees to come to Bonusly’s app or site to use it, but if we could bring recognition into the tools that employees were already using, that would be a huge win. And so, you know Slack was clearly onto something, they had a great integrations platform, and just there was a clear use case for how employees could use Bonusly through Slack, and so it just seemed kind of like a no brainer to build that integration. |
| Scott Orn: | Was there like a formative moment in your career where it kind of led you down the path of wanting to do you know employee and team recognition tools; it’s a sector that’s so important for the moral of a company, had you experienced a positive experience or a negative experience early in your career that led you to start this company? Raphael Crawford- |
| Marks: | I sure had, and I should say also I am the co-founder of Bonusly, so it wasn’t just my idea, my co-founder John, actually he was the one who originally approached me with this idea, but it really resonated with me, and we both kind of decided to go for it, because we had both good and bad, and to be honest probably mostly bad experiences related to recognition in our previous careers, both as an individual contributor and as a manager. So the two pain points that Bonusly really addresses are, for employees, even when companies are small but certainly as companies begin to scale up, it becomes very easy to start to feel disconnected from the goals and mission of the company and you start to lose a sense of— is what I’m doing really valuable and valued by the company, and that’s a really dangerous place to get into, that very quickly leads to demotivation and kind of apathy and eventually leaving the company for a place that’s more engaging. And, I had certainly experienced things like that at companies I had worked for as an individual contributor. And then, as a manager, both John and I had experienced times where as managers we were responsible for motivating the teams and recognizing and rewarding our teams, but we knew that the real expertise about who was doing what, and who was working with whom, and who is bringing what strength to the table— all that expertise lay with the team themselves, and as managers, managing a dozen or more people, it was just impossible to be present enough and have enough visibility to really be fair distributors of recognition and rewards. And so, we really wanted a tool that would distribute that responsibility throughout the team and empower everyone to be able to give recognition to one another. |
| Scott Orn: | Yeah, you nailed it, because that’s kind of the situation we’re in, we’re growing really fast and we’re at 24 people now, and it was so much easier maybe a year ago to know who was working and kicking butt, and really give them recognition; but now, our company in 24 feels very big to us, but we know we’re still a small company, but that’s why Bonusly is so awesome, it’s like the peer recognition is so powerful. And the other thing I really like about it is, this is a little materialistic but it actually translates into real world kind of gifts or services that our team can use, so like one very frequent thing is people turn their Bonusly points into Amazon gift certificates, or they turn them into movie gifts certificates, so we hear our team like going to movies together after work, because they use their Bonusly points, things like that, it’s like it continues kind of the good vibes all the way to some tangible— aside from praise and recognition in front of your peers, it also results in something fun that people can do and it really cements kind of the reward in people’s mind. Raphael Crawford- |
| Marks: | Yeah, definitely, I think that’s really great to hear, and we certainly hear similar things from other customers. I’m sure you know the rewards in Bonusly and the rewards you get or not massive in terms of their monetary value; but, employees get to choose from a very wide range, so they get to choose what is going to be enjoyable to them. And then, very often you see employees choosing rewards that they can then share with their fellow colleagues, like movie tickets for a team moving night, and things like that. |
| Scott Orn: | I think the reward is not being like huge dollar amounts as a feature and not a bug, because if they were so lucrative then it might change the dynamic of people giving a more— it might just might kind of mess up the nice dynamic there is. I love how people can actually buy something cool from Amazon or go to movies or do whatever; but it actually is something that translates into something, and it’s not kind of make believe points, but it’s a great service. You said something earlier about kind of building the product while your nights and weekends— what was that like, like how long did you bootstrap for it? Raphael Crawford- |
| Marks: | We bootstrapped for over two years. |
| Scott Orn: | Oh my god, and you’re still alive?! Raphael Crawford- |
| Marks: | Yeah. Yes, so starting in— |
| Scott Orn: | I mean that physically, not mentally, like it’s working a job and then bootstrapping is very difficult physically. Raphael Crawford- |
| Marks: | Yes, it was an intense time; John and I, we knew each other from the late nineties working at startups in San Francisco, and then coincidentally had both moved to New York within a couple of blocks of one another, so like we hadn’t planned this, but we ended up being neighbours in the same neighbourhood in Brooklyn and we’re both kind of rather frustrated Californians living in New York, and so we’d meet up to commiserate about that, relatively frequently; and eventually, we decided to pursue Bonusly. But we had jobs and families and you know, couldn’t just jump ship and try this on a whim or try to raise some money without knowing there is a little bit more of something there. So, yeah, we just took nights and weekends to build this and piloted with some friends’ companies, got really great feedback, opened it up to the public, had some kind of unaffiliated companies sign up and gave us really positive feedback; so we just kept working at it, and working at it, and then, you know, eventually it just became too big for us to do as a side project. And by then, we had paying customers, we had Slack integration and a bunch of other more advanced features built out. And so, we knew we had something at that point, and it was— I am not going to say it was easy, but it was easier at that point to go to venture capital and make the pitch to raise some investment. |
| Scott Orn: | Yeah. You know, Vanessa bootstrapped our company for, really we’ve been bootstrapped the whole way, but for the first couple of years she didn’t really take a salary and just kind of invested everything in the business. And I think, it’s great, I used to work in venture capital, I love venture capital, but sometimes it comes a little too easy at first; and doing kind what you did, which is build the product, get feedback, go through some tough times, stay up until one in the morning working really late a lot, and working out the kinks and really getting into what makes the product work and what makes it sticky, is so valuable and it’s kind of like laying a really strong foundation for a house, and once you get that strong foundation, and also kind of the values of the company, you are probably hiring some freelancers or things like that, and couldn’t pay exorbitant salaries, you know, then you kind of get, you set a culture and you set the foundation— it’s a lot easier to go forward there when you do have the money, you know, you make better decisions once you raise the capital. Raphael Crawford- |
| Marks: | Yeah certainly, I think we still to this day retain a culture of always trying to do more with less, and really taking pride in having success, despite really limited resources. And so even though, you know we do have, we have raised money and revenues are a lot bigger now, we still are always looking for ways to be more efficient, ways to automate things, ways to multiply our own productivity and you know, we’re still a very small team, we’re 14 people at this point. So you know, far cry from me and John sitting on a couch, but still a relatively small business, and it serves us well because we are playing in a space of HR technology that is quite crowded, and there’s some very large incumbents with very deep pockets, and so we really have to have that approach in order to be competitive and continue to grow. |
| Scott Orn: | That makes so much sense. Now, you said something that you guys met in New York, but for some reason I thought you were like a Colorado based company, are you guys dual-coast, or excuse me, mid-west and New York, or what’s kind of your location? Raphael Crawford- |
| Marks: | Well, actually John and I met in San Francisco in late nineties, then we both moved to New York and that’s where we founded Bonusly. And then, John for family and quality of life reasons moved to Boulder Colorado, and so we built a very small team as kind of a two office or distributed team, so we had myself and a couple of people in New York, and then our tech team with John as the CTO was growing in Boulder, Colorado. And that’s how we get things, but the team in New York always stayed pretty small, we invested a lot more in your product development, and so eventually when one of our more senior employees here in New York decided to move to Seattle and some of my own family situation changed which allowed me to consider a move to Boulder, we decided to consolidate in Boulder, so now our headquarters is in Boulder, I’m in Boulder, and we have a couple of remote employees still, but everyone else is here in Boulder Colorado. |
| Scott Orn: | That’s a good start. How do you, obviously you like it because you’re there, what are the pros and cons about being in Colorado in Boulder as a startup? Raphael Crawford- |
| Marks: | Yeah, well the pros really are numerous, so the pros are, Boulder itself and the front range of Colorado is beautiful, the weather is fantastic, the cost of living compared to New York or San Francisco is much, much lower; you have UC Boulder or CU Boulder I guess they call themselves, which is a great source of technical talent, we’ve hired a couple of people with you know CS masters degrees from from CU Boulder, so you’ve got great talent, you’ve got a great weather, great quality of life, and then the cost of operating a business are much, much lower here than then would be in New York or San Francisco. I mean, we are renting out a pretty amazing office in Boulder for what it would cost to have like a closet in New York. |
| Scott Orn: | Probably your home is too, it’s probably so much cheaper. Raphael Crawford- |
| Marks: | Yeah, so yeah, and then, we’ve out of 14 people, I think we’ve convinced three of them, three of them were people who we convinced to relocate to Boulder for Bonusly, and that’s not just Bonusly, that’s obviously the location as well, it’s like it’s a really attractive place to live, and so I feel like it gives us a leg up on hiring, we’re not competing with that as many other startups and tech companies as we would be if we were hiring in New York or San Francisco. |
| Scott Orn: | When you went to raise money, did you do it in Colorado VCs or did you just kind of go through relationships you already had? Raphael Crawford- |
| Marks: | We raised from New York VCs, or VCs that are bicoastal but have a presence in New York, and we raised before John had relocated to Colorado and then we’ve stuck with the same VC, so we raised from Bloomberg Beta and First Mark Capital, and they are the only two investors we’ve worked with to date. Yeah, actually the way we got connected with them was Bloomberg we were connected to through an adviser to the company, and then First Mark, we were introduced to through one of our customers, so one of our customers a company called Invision is a portfolio company of First Mark, and they were an early adopter of Bonusly, and we asked them hey, if you are enjoying Bonusly, would you mind introducing us to your investors, and they did, and that’s kind of the best way to get an introduction into a VC, if one of their existing investments is using your product and really likes it. |
| Scott Orn: | Oh my gosh, that’s like the best way, that’s amazing. I’ve heard really good things about that group actually that’s really cool. Awesome, well it sounds like you got the life in Colorado building a great company, a product that people love and you get to spend some time outdoors and have a low cost living, so maybe I should be looking for real estate out in Colorado. Raphael Crawford- |
| Marks: | It’s pretty nice. |
| Scott Orn: | What are some like, just changing gears, like what are some— you have to get like tons of funny stories or people tweeting at you, like crazy Bonusly things, like what are some of the craziest or funniest things you’ve seen come across your twitter feed maybe? Raphael Crawford- |
| Marks: | Yeah, well something I really enjoy is employees have taken to creating Bonusly memes, and so they’ll create kind of, they’ll pick a funny gif or something, often as like someone making it rain with dollar bills, or doing something funny and then overlay some funny message about how great it is to receive Bonusly points or recognition with Bonusly, and so that often get tweeted at our people in the company and then just mentioning us, and so we’ll kind of get to observe that and if you had a conversation that goes on, so that’s a ton of fun. And, then, I think something we’ve also really enjoyed hearing about are the different ways that the companies kind of use the recognition that was created in Bonusly in different ways, like you said, at Kruze you guys celebrate the top four earners every week kind of in a public meeting and so a lot of companies build up their own practices and celebrations and like that around the data that they could get out of Bonusly. And that’s always really cool to hear as well. |
| Scott Orn: | The making it rain means are very prevalent at Kruze Consulting on the Slack. What’s like kind of the single— again, we didn’t want to dwell on the materiality of the gift, but it is fun to see people rack up a lot of points and buy something cool; have you seen anyone do like a crazy cashing or like take the whole team to dinner or something like that with all their points? Raphael Crawford- |
| Marks: | Yeah, I mean, I have seen certainly happy hours, dinners, things like that, ultimately Bonusly is designed for the reward amounts to be relatively small, particularly for a knowledge worker in a developed country. So I haven’t seen anyone you know, like buying a boat with Bonusly points or anything like that, but yeah, a lot of like fun social activities that people will do with happy hours. I’ve seen some companies that will create their own custom rewards of like you can get champagne for the office or something, it’s a little bit different than the traditional office hours, champagne, so it’s kind of a funny custom reward to see that some companies were offering. |
| Scott Orn: | Do people like, people must write in on your twitter or customer service and be like hey can you add this reward— does that ever happen? Raphael Crawford- |
| Marks: | It happens all the time, yeah. And there’s obviously limits to what we can do, but expanding our reward catalogue is something that we actually put quite a lot of effort into. In the United States, it’s pretty solid, but it’s something we really expanded over the last years are global reward catalogue as we expand internationally. So we have a lot of customers in Europe and Asia Pacific and Australia, so now we have large and growing reward catalogues for countries in those regions. |
| Scott Orn: | Wow, that must be really complicated because you got to plug in and on a regional basis. So are you guys essentially like a global company, like anyone in the world can use Bonusly? Raphael Crawford- |
| Marks: | Yep, anyone in the world can use Bonusly, and that was also an early decision, when we were kind of designing the point system and how it translates to currency value. We didn’t hardcode a dollar value, we made it you able to choose a kind of any base currency so a company that’s headquartered literally anywhere in the world can operate Bonusly in their own home currency. |
| Scott Orn: | Yeah that actually makes sense, because I was wondering if it was like a percentage of dollars or what, but keeping it a kind of abstract and not tied to any specific currency is really smart. You’ve created something really amazing, what’s on the future road map for you guys, like where are you going next? Raphael Crawford- |
| Marks: | Yes, so something that you guys probably aren’t really aware of right now, because you you’re still relatively small is we’ve invested a lot recently in developing a relevant algorithm and then using that relevance algorithm to drive kind of highly targeted updates and notifications. So, for a company of 24 it’s not as impactful, but if you’re a company of five thousand people, you don’t want to like log into Bonusly and see a fire hose of all the recognition that’s being given by all five thousand people, you want to see the recognition involving the people you know at work. And then once we know who you know at work, using our relevance algorithm, we can send out updates like when it’s your work anniversary, or your birthday, we can tell your closest colleagues at work that that’s happening, and then they can celebrate that through Bonusly. So that’s something that we’ve relatively recently deployed. |
| Scott Orn: | And you’re right, I never even— because we’re so small, we’re 24 people, like I never thought about the five thousand person company problem, but that’s super important. Raphael Crawford- |
| Marks: | Yeah, and so you know, we still always have our kind of product for startups and growing companies, but we’re starting to expand more and more in the kind of mid size enterprise of high hundreds to low thousands of employees. And so, we’re developing a lot of features in that area, and kind of along the same lines, along the same lines, we’re developing some tools to help extract like insights from Bonusly data, to make performance reviews less terrible, so we’re not rolling out a full employee review feature within Bonusly, but kind of a suite of easy to use tools where when someone’s performance review is coming up you can click a few buttons and Bonusly will give you a bunch of really interesting highlights about that employee, that are all really positive, because that’s what Bonusly is about. And then also help combat things like recency bias, where the manager can only remember what happened in the last two weeks, Bonusly can really highlight accomplishments for any given employee for any time range. So we have a whole suite of features, some that are being released very soon and then some that will come out in the next three, six, nine months as well. |
| Scott Orn: | I love it. Well we couldn’t be bigger fans, like we love Bonusly so much and that really has contributed a lot to our culture and to just people feeling recognized, so we love it and I can’t recommend it enough to the audience like please check it out, it’s super easy if you have Slack in your company, I think it look like one minute to install the Slack app and get it going; so kudos to you for making it easy for customers to use, and making awesome product. Maybe you can just kind of to wrap up, like tell everyone where they can find you and if they’re interested in checking out Bonusly where they should go? Raphael Crawford- |
| Marks: | Yeah, absolutely, so we are Bonusly, that’s bonus.ly or bonusly.com, we own both domains, so you can visit our website there, you can find us on twitter @bonusly, and yeah, it’s free to sign up, it’s free for small team, so if you’re just starting a company or have a small startup you can get started and you try it out for free. |
| Scott Orn: | Raphael, thanks so much man, and congrats to your co-founder John as well, and the whole team, you guys have built a really great product and we love using it. So thanks for coming on the podcast. Raphael Crawford- |
| Marks: | Thanks a lot, I really enjoyed it. |
| Scott Orn: | Alright man, you take care. Raphael Crawford- |
| Marks: | You too, bye bye. |
