An MIT-educated CEO is leading a fast-growing company by keeping people happy.

Last July I interviewed, Stefania Mallett, who holds a Bachelors and Masters degrees in Electrical Engineering and Computer Science from MIT. She's CEO of ezCater which Mallett described as "the only nationwide marketplace for the $21 billion business catering market. ezCater's online ordering, on-time ratings and reviews, and award-winning, 5-star customer service connect businesspeople to reliable catering for any meeting, anywhere in the United States."

Co-founded in 2007, ezCater raised  $35 million in January 2017 from ICONIQ Capital, the family office and venture firm associated with Silicon Valley billionaires like Mark Zuckerberg, and Insight Venture Partners -- bringing its total capital raised to $70 million, according to Forbes.

In an April 13 interview, Mallett sounded radiantly happy about ezCater's progress. As she said, "We're doing ridiculously well. We're doing another capital raise and just got our first term sheet, we're expecting a couple more on April 17. We have happy people, customers, and restaurants." To its credit, ezCater was named last fall to Fortune's list of best places to work.

There are three leadership principles underlying ezCater's success.

1. Adapt your organization as you grow

I asked Mallett to describe the tiers of revenue -- for example, $0 to $5 million, $5 million to $15 million and so on needed to turn ezCater into a $1 billion company. She said, "I don't look at it that way. It's not revenue, it's the number of layers. You start off with the founders doing everything; then you hire managers who are responsible for a process; then you hire managers of managers."

In essence, ezCater differentiates then integrates these functional teams. As she explained, "When we first got started, the people who signed up the restaurants on ezCater also entered information about their catering menus and delivery hours into our system. We realized that we should have a dedicated content team that would care about the accuracy and formatting of how the details were entered into our system and free up the sales people to bring in more new restaurants."

ezCater then broke down the content task into smaller parts. As she said, "Then we found that our content people preferred to focus on specific types of restaurants such as Mexican or Thai and some people liked to enter text while others wanted to focus on photos. For a while, people wanted to split up data entry and quality control. Now everybody does some data entry and some quality control. The teams are always soliciting feedback from customers. The most important thing is that the team owns the process and decides how to make it better."

2. Instill a 'Growth Mindset' 

A company's culture can inhibit or encourage growth. As I wrote in Disciplined Growth Strategies, culture is what happens when the values that a founding team holds dear get used to hire, promote, and fire the people who work in the company.

A culture that promotes growth values people who are passionate about inventing new products that customers are eager to buy and thereafter give those customers excellent service so they keep buying over a long period of time. If the people love working for the company and the customers love its products and services, then the customers become its most compelling evangelists."

ezCater's culture is based on the "growth mindset" idea she learned about from Eve Grodnitzky. As Mallett said, "My cofounder and I are tinkerers. We ask, 'Can we make it go faster?' We come up with hypotheses, build a model, try it, track it, and learn from what works and what doesn't. We try to stay ahead of the curve rather than lag it. This growth mindset is at all levels of the company and it means that everyone shares responsibility for achieving growth."

3. Make everyone accountable for achieving company goals

Such growth strategies are a means to achieve a company's goals. For many companies -- especially ones that take venture capital -- a key goal is to grow fast so the company can go public or get acquired. To be fair, CEOs never admit that this is a goal -- instead they want to change the world by building a company that will last.

But CEOs still want to achieve growth. And the challenge for a leader is how to make everyone in the company accountable for achieving the company's goals. This is a complex challenge because it is far more difficult for an HR leader to identify what he can do to boost revenue growth than it is for an account executive with a specific sales quota.

ezCater aspires to make everyone accountable for achieving the company's goals. As Mallett explained, "We have six company goals such as grow, uncover a new sales channel, and handle 500 employees by year end. Each department takes responsibility and breaks it down into smaller pieces. We push authority, responsibility and reporting as far down as possible. We take a cue from the Japanese auto industry where anyone can stop the line if they see a problem." 

If you want your company to grow, try to follow these leadership principles.

Published on: Apr 18, 2018