How Culture Steers Through Crisis: The Eventbrite Story

I'm so ready. Thank you for having me.

In over two decades, Eventbrite has seen the advent of social media. When we began, we really were focusing mostly on Google search as our vector of finding new customers and growth. And within two and a half to three years, our main mode of distribution was social media through Facebook. So that was one big wave of a technological shift. The second was mobile. When we started Eventbrite, people were using their phones for mostly communicating with each other. And in the span of the last two decades, we have seen Eventbrite be rebuilt for mobile and have a really far extensive system and not only distribution network but functionality through mobile devices. The third was big data. When we began, data was kept locked away in a database. And today, it informs most of all of our decision-making and how we get closest to our customers. And of course, the big wave of AI now helping us build faster, more efficiently, and more personalized for our customers. In the middle, we had a big growth era that was marked by six acquisitions of companies. We had, of course, our IPO and taking on many new shareholders and capital. We had international expansion and then a global pandemic that rendered the basis of our business null and void for a period of time and essentially gave us this huge opportunity to reset 14 years in and rebuild the company. The two systems that allowed us to persevere through that time that I think whether it was weathering pandemics and recessions or this constant technological change were really A, capital efficiency, and B, treating our customers as our greatest advocates and scouts. And I think underpinning all of it, of course, was resilience and belief in the core mission that bringing people together through live experiences is something that all humans need.

Well, I came into starting Eventbrite not being the obvious entrepreneur. I met my then fiancé, now and still husband, Kevin Hartz, when I was working in television and I was on the development team at MTV and then at FX Networks. And so I was really focused on story arc and evoking emotions from audiences through great stories. And I was able to work with some of the best storytellers in the world. And what I saw through Kevin, we had this meet-cute at a wedding. And what I learned from him for the next two years when we were in our sort of dating era was how quickly things were changing in Silicon Valley. He's a multiple-time entrepreneur and investor. And also I was intrigued by the idea of being more on the disruptor side than the disrupted side and just the velocity of how quickly things were moving in his world versus my world. When we made the decision to start a company together, I had absolutely no idea what I was getting into. I wasn't the kid with the lemonade stand growing up. I was a ballerina. I was really focused. I'm very good at taking direction and adjusting and I have a lot of discipline. But I did realize almost on day one that I finally solved the mystery of why I didn't love school. And it was because I didn't love to be just talked at. I love to learn by doing. I love to get my hands dirty. And so starting a company is exactly that. And I'll never forget the day that we set up our little office in a windowless phone closet in a warehouse in Potrero Hill with sawhorses and plywood as desks. And I remember opening my computer and typing, 'How do I create my first search engine marketing campaign into Google?' I thought that was kind of meta. And I got this jolt, this almost like lightning strike of energy. And so what I love about being an entrepreneur, even though I wasn't born one, but I learned how to be a great one through Kevin's mentorship, is that I'm an excellent problem solver. And I really leaned into building a great culture in the company that now 20 years later, I can say is one of our great legacies. I also decided about halfway through the journey that I needed to not be concerned about the fact that I felt like I was being an impostor as an entrepreneur but actually embrace the fact that I'm a great operator and that was the yin to Kevin's yang. And with our third co-founder, Renaud Visage, who built Eventbrite, we made an awesome founding team. So that taught me a lot about working with your core competencies and leaning in and that not everyone has to be the perennial entrepreneur.

It really was. And I think that the culture part, I can't underestimate how important that is. And I have this benefit now of being on the other side of 20 years and of building Eventbrite. And I can say without a doubt that was the best investment that we made. But in that there were systems. So I remember when we had raised our first round of outside capital from Sequoia Capital and Rufus Refaeli, and that was about almost three years into our journey. So we had been bootstrapping and been supported by family and friends and early investors that were, you know, angels until then, but this was our first big slug of capital and we were going to grow from 30 people to 100 people in less than a year. And instinctively I understood that we were going to be growing from a team to a company. And all around us, the 2006 vintage companies were going through, the ones that had made it through from product-market fit to traction and had been funded, were all going through some sort of growing pain. And I remember thinking, 'Wow, this growing pain is going to be inevitable. Something's going to break. We're going to lose our culture.' But then I paired that thought with the feeling that Eventbrite to me was as important as my firstborn human baby. And at that time I had a baby too. So I can make a good assessment there or authentic assessment. And I thought I might as well die trying to cultivate a great culture through this hyper-growth phase and beyond because I think that's worth dying in the process of trying. And that unconditional love I felt really compelled me to dig into what I didn't know much about, which was building culture. And I realized very quickly that culture is actually and very simply the manifestation of the people at that place and time working together. And so therefore it's not something that stays in one place. It's not a bug preserved in amber. It's actually an amoeba that constantly changes. But if you have the right core and the right elements and you have that whatever people call it, center of gravity, north star, values, principle, like you're always going to be building strength and attracting great people. And I just attended the 20th anniversary party of Eventbrite where we brought together current and former, we call ourselves Brightlings. And I can definitively say we did the job. The bonds that people have, the stories they tell, the way they reference their time at Eventbrite, it really meant something.

Absolutely. The first one that is very clear now, and again I have the benefit of hindsight, is that we care for one another. And that was this funny thing when we were growing in the beginning and we were hiring engineers. I remember an engineer would come through and would interview with Renaud and pass the technical interview. Then they would interview with Kevin and they'd pass common sense and product sense. And then they'd come to me and I remember when we were scaling from like 100 to 500 people, I was still meeting with every final candidate and the recruiting team would say, 'Ah, watch out. This one's a little thorny. This one's a little cranky.' There's so much reverence for software engineers. And certainly back then when everyone was coding, it was like all hands on deck to recruit these engineers. And I would always walk out of the room practically arm-in-arm with this otherwise known as cranky engineer. And finally one of the recruiters asked me what are you doing in there and I said I'm just asking them to tell me their story and that I'm showing them empathy and what I believe is there is not an engineer cranky enough who just doesn't want to be loved. Like everyone just wants to feel cared for. And that actually, that was not me alone. That actually started to just reinforce how people treated each other. So care for one another above all else. That then translated very easily to care for customers. And so we had this almost like symbiotic relationship for if you care for one another and you can, so you're never looking over your shoulder to ask do I belong or is this person doing something to undermine me, then you have more energy to care for your customer. And that ended up being this virtuous cycle that just fed Eventbrite strength through every crisis and every hard time. And we didn't always have the best culture, but we had a culture that cared for one another. And then some things around that were like don't lie and do the right thing. And that's just how Kevin and I were raised. And so I think it was like reinforced into our culture from the beginning and that really came in handy a lot.

Yeah. And you know we were always really honest with our customers, our team when things weren't going well. That was always the harder path. But I never wanted to go to bed thinking, 'Oh, I'm not telling the full truth.'

Sure. Two things that come to mind immediately. So, I'll just tell you both, which is COVID hit Eventbrite in early March of 2020 and we were ready. Thankfully, we live in San Francisco. We have the crown jewel of UCSF and the research community and we happen to be very close to the head of the infectious disease department. So that was like wow, great fortune but also terrifying. So we knew that this was not going to be a passing two-week thing. We also had the benefit of some incredibly smart people surrounding Eventbrite at the time. So people like Rufus Refaeli, our board of directors, Henry Ellenbogen, incredible investors and long-term thinkers. And we went to them and said, 'What would you do if you were us?' And they said, 'Don't assume this is going to be fast. Take costs way down and raise money now and don't wait.' And in the midst of that, that was call it maybe the first couple of weeks of March. By mid-March, we were processing more refunds than revenue. And actually, Bob Mylod, who had been the CFO of what became Booking during 9/11, had told me about that about a week before it happened. He said, 'Kid, strap in. You're about to have negative revenue days.' And I'm like, 'What are you talking about?' And then I called him a week later. I said, 'All of our Tableau dashboards broke because our revenue line is below zero.' Because what was happening was we were refunding more tickets for events that were getting cancelled than we were selling tickets. Now, the bigger issue is that Eventbrite had grown to be this really efficient transactional platform. We were great at moving microtransactions of $50 or less in some totals of billions of dollars a year for these events. We'd gotten so good at anti-fraud that we could actually front the ticket sales to our event creators for them to book the venue, book the act, pay the vendors with less than a 1% fraud loss. So, you get to mid-March and we have hundreds of millions of dollars advanced out to event creators and producers and promoters and venue owners. We have more refunds than ticket sales. And all of those events are not going to happen, but nobody knows that. And when they don't happen, consumers get angry and they charge back and it's a disaster. And so we were facing potential insolvency, which is why we needed to cut costs quickly and go raise money, but we also couldn't continue advancing that money. And so we had to decide to turn it off and turn off this advanced payouts program that many of our creators were counting on to stay afloat. And that was a really difficult decision. And I remember Kevin and I sitting in this office because we'd all gone home because we were now quarantining, right? And we were calling our biggest customers and they were just furious with us and we were trying to tell them your event or your festival is not going to happen and we can't pay you money for an event that's not going to happen, but also you should not be paying your vendors and booking your venues because you're going to lose that money. And that was a really hard period of time that took a long time to recover from in terms of trust, but it also was the right thing to do because it actually protected their money. That was still their ticket sales were their money, but we needed to make sure that they could stay in business and that we could stay in business. That was really hard. I think the second hard one was when we changed the pricing of our core product and we didn't land the execution and then we reverted it a year later and we were sorry because that obviously did not land with our customers. There's so many ways you can shimmy out of that. You can change it again. You can change it quietly. You can not change it and figure out another way to make more money. Well, we went down the hard path of saying, you know what, we got this wrong. We didn't hit the mark on this and here's why and here's what we want to do about it. And that was important for me as CEO to be able to look our customers in the eye and say this was our mistake. Nothing you did and we'd like to regain your trust.

The information was sufficient. It was the human emotion that was muddying the signal. I mean there's no, it was so clear there was no, once you understood the history of this and the science of it and the rate at which it was spreading there was absolutely no denying that it was going to be a pandemic. So I think the hardest part was having that knowledge. A lot of people had the knowledge. This isn't like we were in some secret bunker. It's just the human emotional system has a way of saying but maybe not. And we just weren't willing to risk our customers' businesses and our business on what if we're wrong. Really, really admire and am grateful to the people who told us to act fast as painful as it was. And I'll take you through what that looked like because what that actually looked like was during my team in mid-March, we had just filed out of our beautiful offices and had gone home and it was chaos. You remember like everybody was trying to figure out Zoom, the Zoom team themselves. I spoke to Eric, the CEO, because people were starting to do online events, virtual events. So we built an integration really quickly. But I was talking to him and he said, 'We're such an in-office culture. It's just chaos right now because people are trying to figure out how to work from home.' And I thought like, 'That is so ironic. That's amazing.' But I gathered my executive team and there was a lot of fear, a lot of chaos, a lot of kids and dogs running around. And you know, I was like, 'How about we make a rule that you don't apologize for your kid or your animal because if they hear that a lot, they're probably going to have some issues in the future.' Like, they're going to have issues anyways. This is crazy, but like maybe we just don't apologize for them and just let them be in the picture, you know? And then I said, 'Given what you know about this business and all the choices we've made, good and bad and indifferent, what would you do if you could do it all over again? Like what could we do?' And we just started riffing on that and there was like a boat analogy that I don't exactly remember the details of, but I'm sure I'll find the sketch somewhere. We started like writing things down and at the end of the meeting we had a one-pager on what we would do differently. And then I did not pre-plan this, but I have to say it was one of my finer leadership moments. I said, 'We're going to rebuild the company because there is no company right now. We're not making any money and we're facing this sort of imminent disaster if all of these events get cancelled that we've already sold this money for. So, let's go do this. Let's go make this company.' And the most brutal part of that was we had to almost un-build the company. And my rationale there was we needed a north star and a strategic plan to make those cuts. Otherwise, you're just making your best guess and you're taking people's lives in your hand without a real purpose, right? So, we needed that north star to go build that company and then figure out who we needed for that company. The second thing was I had an instinct given again our embracing of the fact that that COVID was going to be enormous that companies would take a while to do their layoffs. And I had this sense that if we laid off our team early we could take, we kept on our entire recruiting team which was like 25 people at the time because we were 1,200 people global. We could keep them on and actually make their full-time job getting the people we were laying off jobs so that you could invert the system and then rewire it. And our KPI was how many Brightlings are secure in a new job because my feeling was if we were the first ones to go out and we could land those people before everything went to hell in a handbasket. And that worked. Obviously, not 100%, but it really did work. And it showed people that we were willing to walk the walk even in the hard moments. And then we had to go raise expensive debt to shore up our balance sheet, which I'm still a little sore about, but we had great partners. And we ended up not needing the debt. But that was acting quickly and being decisive and paranoid, healthfully paranoid that this was not going to be a small or short endurance sprint. That really paid off for us in terms of why Eventbrite even exists today. There's no reason why we should have made it through that. That was a disaster.

And I'm not trying to get accolades for like doing a big layoff because I think obviously that's always should be the last case scenario in a moment when the company essentially didn't exist because again we weren't making revenue. I was sure that there was a way we could do it that would be aligned with our values and humane and thoughtful and that wasn't something that I wanted to be great at. But I knew that in any case when you're facing that much uncertainty and you have to do something that hard that there would be a way to show up for each other and care for one another. And I think that also helped a lot of people feel not alone. Especially the people, and that was not an easy time to stay at the company. The years after that were not exactly, we weren't like whistling zippity-doo-dah. It was hard and it was a really hard long rebuild.