The RBC Disruptor's Handbook: 21 Things We’ve Learned about Digital Disruption

Entire industries and careers are being created or overturned, and the disruptors tend to be entrepreneurs and innovative organizations whose greatest asset is mindset.

We launched RBC Disruptors in 2015 to explore how this new tribe is using technology to change everything around us. Since then, we’ve profiled 50 remarkable organizations – Shopify, Slack, Ritual, Apple and Amazon, among them – and gained some remarkable insights.

If they had a playbook, they’d call it B.L.A.S.T.

• Build … a culture that balances speed and resilience.
• Learn … in order to grow.
• Adapt … by changing constantly to user feedback.
• Scale … by isolating pain points for users and scaling solutions.
• Trust … your partners to take you to the next level.

Here are 21 lessons our Disruptors learned from blast off:

Build

Incumbents plan then build; disruptors build then plan. But neither gets far without a cultural rudder.

#1 Slack: Your first building block is culture

Stewart Butterfield’s world-beating communications tool, Slack, started as something else and kept changing. Something that didn’t change was his culture: it’s rooted in empathy, for the user. Butterfield only hires people who are obsessed with users, which means they have to be good listeners, asking questions and seeking answers. “If someone asks a question in a customer support ticket, it is completely unacceptable to say ‘they’re an idiot because they couldn’t figure this out,’” Butterfield says. “It’s ‘what are we doing wrong that they couldn’t figure this out?’”

#2 Apple: Make your customers feel loved, or at least liked

Being connection-obsessed helps many disruptors leap ahead of bigger competitors. It’s why so many cite Apple as an inspiration, even though it’s now the incumbent.
It still obsesses over experience. “You have to figure out what your unique experience is,” says Angela Ahrendts, the retail guru who oversaw the Apple Store’s global expansion. Her driving belief: “Everybody wants to go hang out in places where they feel welcome, or like they belong, or that people really like them or love them.”

#3 PagerDuty: Build through diversity

At PagerDuty, a Canadian-founded startup based in San Francisco, nearly two-thirds of its leadership team are immigrants. Moreover, half its engineering leadership team are women, as is half the executive team. To get there, the company often deferred hiring decisions – at the risk of short-term growth – to get the right mix of people. “We think about diversity and difference as upside,” PagerDuty CEO Jennifer Tejada told us. “All the data points to better business outcomes – better respect, better results, better shareholder returns, better customer offerings.”

#4 1-800-GOT-JUNK: Paint a picture

Only after Brian Scudamore joined the Young Entrepreneurs’ Organization did he see how to get his business, 1-800-GOT-JUNK, to the next level. “I didn’t have the clarity of vision to get where I wanted to go. I asked myself, ‘what could pure possibility look like if nothing was in my way?’” He painted a word picture and put it on the wall:

• We’ll be in the top 30 metros in North America.
• We’re going to be on The Oprah Winfrey Show.
• We’ll be the FedEx of junk removal.

That clarity of purpose allowed him to hire the people he needed to fill in the picture, and in seven years the company went from sales of under $2 million to more than $100 million.

#5 Lightspeed: Culture is about buildings, too

The physical environment matters. Google transformed Silicon Valley culture not with free food or flex hours but a campus-like culture that inspired curiosity. When he was building Lightspeed in Montreal, Dax DaSilva developed office spaces that were inclusive beyond the physical environment. His use of artwork speaks to Lightspeed’s culture of diversity and inclusive thinking. “The company has built out of culture just as much as code,” he says. “That’s always been our credo.”

Learn

Fail fast has become one of the most misappropriated lines of this current age of disruption. Innovation is not about failure. It’s about learning, at times through failure.

#6 Hubdoc: Hire for curiosity

As he was building Hubdoc, an app that helps businesses automate their bookkeeping, Jamie Shulman looked at his most successful employees and noticed a common denominator: “curiosity, being interesting and interested.” The company needed more curiosity, so he redesigned its hiring process. Today, the first recruiting round for sales staff is a simple sales call: the candidate has to call in and sell the company on their own product. The second round has nothing to do with sales: candidates have to come in and give a presentation about their passion, whether it’s fly fishing or the Dave Matthews Band.

#7 Ritual: If it doesn’t make you cringe a little, you’re not learning

Ray Reddy works with a simple assumption: Version 1 never works. His company Ritual started as a food-ordering app for individuals but then noticed it was used more by groups. Why? Coffee and lunch are very social things. The result was Piggyback, Ritual’s super successful feature that allows users to jump on co-workers’ orders for free delivery. That was the easy part. The first three versions of Piggyback failed because the Ritual team didn’t appreciate how office groups worked. His team cracked the feature based on those learnings and today more than 150,000 teams around the world use Piggyback. It’s a reminder of why so many disruptors talk about MVP, or minimal viable product. “Just do it as simply as you can to get a learning or a data point and then we’ll go from there,” is how Reddy sees it. How do you know when you don’t have a learning culture? When you release products that don’t make you cringe a little. “That’s when we’ve probably spent too much time on it,” he says.

#8 Clearbanc: Always be iterating

Michele Romanow is now famous because of Dragon’s Den, but her real success lies in a string of start-ups she’s built going back to university. A caviar farm. A coupon app. And now a platform for entrepreneurs to raise money. In none of those cases did she have a eureka idea. In innovation, there’s no eureka moment – just an endless cycle of iterations of building, breaking and improving. “I totally reject this notion of a Big Idea, and there’s lots of research to back this up. It’s where I see a lot of companies getting hung up. I promise you, when you have good ideas and great companies, they all start incredibly small.”

#9 Spin Master: Be open to ideas from anywhere

As a start-up from Toronto, Spin Master competes with the world’s biggest toymakers for the next great idea. The company can’t do that on its own. “It’s all about being open to ideas, from wherever they come from,” says Ronnen Harary, Spin Master’s co-founder and co-CEO. That requires personal relationships with hundreds of inventors worldwide, as well as an ability to scour the market for old favourites, such as the century-old Meccano or the 60-year-old Etch-A-Sketch, which in the right creative environment can be turned into something young again.

#10 Singularity University: Crazy ideas can be the best ideas

Singularity University co-founder and CEO, Rob Nail, told us that exponential thinking means looking to the future of your industry 10, 20, 30 years down the road. It’s about growing 10X, not 10 per cent. Nail left us all feeling inspired to think bigger about how we work and how we innovate. He also spoke about embracing crazy ideas. “If those crazy ideas just so happen to be the future of this business 10 years from now, you need to set up a structure, a team or a process that will allow those to come in, or at least experiment with them in some way,” he said. “If you look at the horizon, all the systems set up 100 years ago are being tested – we are going to see fundamental change.”

Adapt

#11 Shopify: Always be listening

Perhaps Canada’s greatest disruptor is Shopify, whose digital retail platform supports more than 1,000,000 businesses worldwide, from artisans to giant consumer goods companies. A decade ago, it barely existed. Today it’s worth $36 billion. COO Harley Finkelstein says Shopify was able to make some crucial changes by using digital tools to connect with users. Such use of social media and paid search have empowered startups to contend against established players on a more equal footing. “It’s no longer about who has the most capital,” Finkelstein says. “It’s now who has the most creativity.”

#12 Cloudflare: Whose problem are you solving?

One of the top tech leaders to come out of Canada is Michelle Zatlyn, co-founder and COO of website protection service Cloudflare. The company became a unicorn – worth more than $1 billion – by helping small organizations protect themselves against cybercrimes. As she puts it: “You go back to the fundamentals. Are you solving a meaningful problem that somebody will pay for? If you are solving a meaningful problem, how big is that problem?”

#13 Hootsuite: Don’t act small

The connection-driven economy allows entrepreneurs to use digital channels that make it easier and cheaper for buyers and sellers to find each other and do business. Any player can act any size in this space. “I want to build the best product we can, talk to our customers relentlessly and figure out what their needs are,” says Ryan Holmes, the founder and former CEO of social media dashboard Hootsuite. “If we do that, we get rewarded for it. And if we fail to do that, then we get punished and our competitors get rewarded. It’s as simple as that.”

#14 WattPad: Data is the thing

Wattpad started as a story-sharing service, and quickly became a platform for 45 million users. CEO and co-founder Allen Lau expanded the social platform to include Wattpad Studios, a venue for Wattpad’s global community to develop movie and TV scripts, and Wattpad Brand Solutions, for writers to connect with businesses wanting copy. Lau’s secret weapon is a user community that is fiercely loyal. He may not have Facebook’s mass, but he’s able to track engagement in ways few others can. Take the typical novel that’s developed on Wattpad: with two billion data points collected daily, the company tracks what’s popular, gives personalized recommendations and can even tell what pages or chapters cause readers to tune out. “We get lots of signals about why a story is fascinating,” Lau said. “If you look at the entertainment industry, this is what they’re looking for.”

Scale

#15 iNovia: Think in the billions

Patrick Pichette is a Montreal-born finance expert who helped run Bell Canada and then moved to Silicon Valley to serve as CFO of Google during its hyper-growth years. One of his responsibilities was to vet all those side projects Googlers are encouraged to do with 20 per cent of their time. He was told by executive chairman Eric Schmidt to use a simple filter: ignore any proposal that didn’t aim for at least a billion users. Pichette retired from Google in 2015, and has since brought that growth mindset to the Quebec investment fund iNovia.

#16 Andreessen Horowitz: Growth is a mindset

One of the world’s most successful venture capital firms, Andreessen Horowitz, looks for entrepreneurs with growth mindsets. Even though that term has become a cliché, especially for consultants, it differentiates the real disruptors from many other very good entrepreneurs. Angela Strange is a Canadian who works as a General Partner at a16z, as it’s known, and sees that mindset much more in the Valley than in Canada. “It’s not even ambition,” she says. “It’s just the belief that you could start something that could become a global leader.”

#17 YouTube: Use platforms for scale

The American filmmaker Casey Neistat has 7.2 million subscribers on his YouTube channel, and his videos—most of which feature him as the narrator and star—have been viewed more than 1.6 billion times. Neistat is one of a new generation of digital celebrities that have found a home on YouTube, which now has more than 1 billion users. His success, according to YouTube’s managing director of global brand solutions Debbie Weinstein, is a great example of the democratizing power of the platform, which transformed advertising, the entertainment business, and mobile communications—and could transform the way businesses interact with their customers. “It’s a platform for anyone who has a story to tell to come and tell it,” she said. “And you can find huge audiences on YouTube.”

#18 Amazon: Divide and scale

At Amazon, leaders use another means of retaining speed and focus through rapid growth: subdivide a fast-growing business. “The way we’ve managed to grow so fast is to act like a federated group of startups,” says Al Lindsay, former Vice President, Alexa Engine Software at Amazon.com. “So Alexa began as a startup and then as Alexa grew and became really big, we kind of refactored ourselves back into a bunch of small startups again and we repeat this pattern fractally throughout the organization.”

Trust

#19 Helpful.com: Seek out competition

The iPhone, Uber and Airbnb were all born in that hothouse of disruption – Silicon Valley – and gained from its so-called ecosystem. There are big pools of talent and capital, of course, but also plenty of frenemies who help innovators thrive. Good disruptors are always looking for ways to harness their ecosystem – to find others to work with and learn from. And critically, to pay it forward. As the serial entrepreneur Dan Debow put it: “Innovation is not this magical elixir that you drink. It’s a result of a competitive environment.” Debow, tapped into the competitive ecosystem in Toronto when he co-founded Helpful.com, a video messenger for professionals, and then sold it to Shopify, which liked the team he had built.

#20 Verified.Me: Always Be Building Your Bench

The best organizations have accountable leaders, and the best startups identify and empower those people early on. “There is a very clear level of accountability, a clear level of communication and a very real sense of urgency against the opportunity,” says Darrell MacMullin, a veteran fintech executive and Chief Commercial Officer at Verified.Me, an initiative to transform the way we manage digital IDs. He tries to imitate a shared characteristic of all the best companies in any field: they not only seek out the best recruits, but they develop what they already have. “Part of their culture is investing in their people, investing in their processes,” he says. “They’re always working on how they run meetings, how they get the right questions, how they get the right leaders to mentor the people on their teams.”

#21 C100: Tell Your Story (No One Else Will)

There are lots of great stories of Canadian entrepreneurs changing the world, but the public often doesn’t know them. The C100 – a group of Canadians in the Valley — is now capturing those stories, to inspire and guide future entrepreneurs. “We have a thriving startup community, but we’re not always good at amplifying our stories,” said the C100’s executive director Laura Buhler. “We are hoping to change that so many more Canadian entrepreneurs can benefit from the knowledge and experience of others.”

For more lessons and ideas on the rapidly changing world around us, visit the RBC Disruptors Hub.

As Senior Vice-President, Office of the CEO, John advises the executive leadership on emerging trends in Canada’s economy, providing insights grounded in his travels across the country and around the world. His work focuses on technological change and innovation, examining how to successfully navigate the new economy so more people can thrive in the age of disruption. Prior to joining RBC, John spent nearly 25 years at the Globe and Mail, where he served as editor-in-chief, editor of Report on Business, and a foreign correspondent in New Delhi, India. Having interviewed a range of prominent world leaders and figures, including Vladimir Putin, Kofi Annan, and Benazir Bhutto, he possesses a deep understanding of national and international affairs. In the community, John serves as a Senior Fellow at the Munk School of Global Affairs, C.D. ‎Howe Institute and is a member of the advisory council for both the Wilson Center’s Canada Institute and the Canadian International Council. John is the author of four books: Out of Poverty, Timbit Nation, and Mass Disruption: Thirty Years on the Front Lines of a Media Revolution and Planet Canada: How Our Expats Are Shaping the Future.

Disclaimer