Every founder is proud of their “baby.” The role of the founder becomes a massive part of their identity. Often the ego gets in the way of being the leader the company needs. Being an egoless founder may sound odd, but it will help you face difficult growth challenges. Today’s guest is Nir Polak, Co-Founder and Chairman of the Board at Exabeam. Inc Magazine ranked his company #388 on the 2020, #134 in 2019 and #12 in 2018 Inc 5000 list. Exabeam helps security teams outsmart the odds by adding intelligence to internet security. Nir shares his journey of success and why you be an egoless founder. We discuss the transition his company recently faced. Nir gives you the one question that guided him as he decided the best decision as the company continued its growth path. Being an egoless founder is not easy but necessary if you want the company to succeed beyond you.
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Nir Polak: The Transcript
About: Nir Polak is Chairman of the Board and Co-founder of Exabeam. Polak was formerly Chief Executive Officer at Exabeam and has more than 18 years of experience in information security, including executive experience setting company strategy, driving execution, building new products, and bringing them to market. Prior to Exabeam, Polak set the company product strategy, and launched and managed the worldwide services organization at cybersecurity firm Imperva. He also held engineering positions at Adjungo Networks (acquired by Flash Networks) and Shopping.com (acquired by eBay). Polak has a Bachelor of Arts degree in computer sciences from The Interdisciplinary Center in Israel.
Disclaimer: This transcript was created using YouTube’s translator tool and that may mean that some of the words, grammar, and typos come from a misinterpretation of the video.
Nir Polak: I think that if I were to come to the company now not knowing anything, I think I could still do the job in a sense, but it’s, it’s the fact that I know everything that was playing against me. The fact that I’m the founder, that’s why I call it the founder dilemma. It’s literally that. You just know too much for your own good. And that’s just, you know, I’ve seen different leaders. If you look at Amazon Facebook, Google, Microsoft, the founders did remain as a CEO for a very long time. I think that can be done. I just think it’s a bit more rare.
Intro: Welcome to Growth Think Tank. This is the one and only place where you will get insight from the founders and the CEOs, the fastest-growing privately held companies. I am the host. My name is Gene Hammett I hope leaders and their teams navigate the defining moments of their growth. Are you ready to grow?
Gene Hammett: When you think about what it takes to be the best leader you can be, you’ve got to make sure that you’re willing to make some hard decisions. This doesn’t mean about taking money from, outside investments and diluting your equity. It doesn’t mean it’s about merging with someone else. What this really means the hard questions are what’s going on inside you. And in fact, what’s the best thing for the company. Today. We look at the ego-less founder. We have a very special guest. Who’s been on the show before Nir Polak is the co-founder former CEO. Now, chairman of exabyte, they’ve been on the Inc list. Many times they’ve grown over 600 employees. And what we talked about today is something Nir calls. The founder’s dilemma really about do you let go of the company and bring in an outside CEO at a certain stage of the company. If you want to scale beyond where you are today. And we look at the challenges he was facing before he made that decision. Was it burnout? Was he tired? The board thought so, but what we talk about today will help you become an extraordinary leader. The ego-less founder is something that you can learn from and really accept that this is a path for you. Maybe you have some resistance around it, but I urge you to take today’s message and be open to it.
Be open to a new way of thinking and seeing yourself as you move forward in this business. Maybe you’re not even close to making that decision, but you’ll know when it does come that you’ll be better prepared because you’ve listened to today’s episode with Nir before we get there. If you’re not sure what your next step is as a leader, how you’re evolving, what’s really most important for you as a leader. I think it’s a mistake. I think you want crystal clarity in the skills and the mindsets that are necessary for you to be the best leader you can be to take your company to the next level. You want to make sure you have all of those things really sharp, and you want to find the edges that you are pushing into right now, many people just put their head down and get the work done. And expect everything to fall into place. It doesn’t happen just like that. Sometimes you’ve got to take a step back. You got to maybe look at some of the things and make sure you’re going in the right direction. That’s what I’m here to help you do. If you’re want to know what your next step is, what to focus on. My name is Gene Hammett. I help people like this all the time. The founder CEOs of fast-growing companies. You don’t have to be on the Inc list, but you do have to be hungry to want to grow and be an extraordinary. It’s going to genehammett.com. Click on, start your journey, and you’ll be able to find out more information about how we could start that journey together.
It’s absolutely free. If you really want to be an extraordinary leader, just go to genehammett.com and go start your journey. Now here’s the interview with Nir, Nir, how are you?
Nir Polak: I’m doing great. How are you?
Gene Hammett: I am fantastic. You’ve been on the show before, but I would love for you to introduce Exabeam. Just tell us a little bit about what you guys are doing today.
Nir Polak: So, I was the co-founder and CEO of Exabeam, the beam. Now I’m now the chairman of Exabeam, what do we do? So we’re in the cybersecurity market in a specific market called security management. And that’s what you see in all of these security operations centers. You see that displays on the screens and all these pictures. That’s us helping different organization manage their security.
Gene Hammett: Well, we need it more now than ever with all the threats that are going on. Are you guys involved with some of these new threats that are coming in?
Nir Polak: All the time. So the thing about security, you can’t talk about it a lot, so there’s not a lot we can share, but for sure, all these different breaches that you hear about more and more operational technology, which has happened on the colonial pipeline and just happened with, with the water systems here in California, you know, these threats are real and this is going to be the new front of, of warfare. And we’re, we’re excited to help different organizations and countries defend against these threats.
Gene Hammett: Love it. Well, we’re not going to talk about security protocols and practices, but we’re going to go into the heart of what a lot of founders either will struggle with at some point in time or are struggling with a currently. And you have, put some words into this, the founder’s dilemma. Give us an idea of what that is.
Nir Polak: So I’ve been able to context actually now is about eight years since inception. And when you start a company, you’re everything, in essence, you’re building the product. You are de facto, the office manager, you do all these different things altogether. You’re a GNA in a box and a lot of other things in a box. And as the company scales. You see that since you’re the creator of the company, you know, everything. And I think that knowledge of you knowing everything creates that hub and spoke management style. At least for me, that happened where everybody came to me with problems and I would solve the problems for them that makes the CEO, the chokepoint. Which is exactly what a company does not need to have, or for continued growth. Once you’re, you know, crossing a hundred million and even more for annual recurring revenue, you need more of a systematic engine that is able to manage itself. And the CEO is really just pointing strategy and making some of the bigger decisions.
Gene Hammett: Well, I think a lot of leaders have felt that they’re the chokepoint or the bottleneck is one of the words I use quite a bit. When you were going through this phase before you are now, before you became the chairman, what was really the things you were experiencing as a, as a choke point?
Nir Polak: You feel that people, I just felt that people would come to me with problems and instead of sending them to do homework, I already have the solution. I would feed it to them. And then in retrospect though, you kind of finish a call and say that was wrong. I should have not solved that I should have sent them back. And the thing that drives me crazy the most is I was well aware of my tendency to try to help solve the problems, but I couldn’t help it. And that’s when I went to the board and I said, I think we need to bring in the next phase leaders of the company.
Gene Hammett: You know, one of the things that I’ve seen happen here is the easiest thing to do and the quickest thing to do. Is to give the solution, but that doesn’t mean it’s the right thing to do.
Nir Polak: it’s like parenting, right. A kid comes to you. It’s exactly the same thing. And you’re trying to tell the kid what to do versus them, figuring it out and making mistakes and doing that. And. I don’t use it in my parenting, but in the company, I did it just because you want to make fast decisions and you don’t want people spending time for, for, you know, getting to the right outcome. so you’re trying to cut the corner. Say, you can go do this and just go and, and de facto as a company skill, investment skills, you’re hiring really good people. You should rely on them to do that.
Gene Hammett: And as flies in the face of really what we believe in leadership is empowerment telling them what to do next. Takes away that sense of empowerment and it ripples throughout the company. Cause you probably saw that as your company was growing to a hundred employees or 200 employees that this gets harder and harder, but it ripples throughout the company because what do they do to their teams? They tell them what to do next.
Nir Polak: And I, I don’t, I don’t know how much it was empowerment for us. , I don’t think anybody felt micromanaged by me at all. I gave them all the leniency to go-to move, but it’s when they had the tough decisions and when they would come with different ideas, you know, they would come to me or Nir with blessing. And, and the fact that by that it created a bit of a situation where all the accountability may be on the CEO versus distributed to his management team.
Gene Hammett: I love that the idea in a perfectly organized there’s no perfect, but in a well-organized and healthy company, not everything rests on the shoulders of years that they’re making these decisions and they’re owning the results behind that.
Nir Polak: Exactly
Gene Hammett: Before you got to the point where you saw this revelation that you had to bring in someone else. Cause we’re definitely going to talk about that. What was going on so that you, as you led up to that decision, to bring in someone else?
Nir Polak: So first, before, how did I, I spend a lot of time mulling on this first, in my own mind, and then talking to my wife and kind of my feelings and what do I see happening? And, it was, it was just a. More of a fusion of different things. The scale of a company COVID was happening at the same time, all of these things. And I just found myself in this situation, looking at where we’re going and the scale of the company, and just saying it is just wrong of me to continue in this position. We have to find someone better.
Gene Hammett: Is it because you didn’t have the skills that you’ve thought that would take the company to, you know, a billion dollars or to an IPO at some stage down there. The future?
Nir Polak: I think that if I were to come to the company now not knowing anything, I think I could still do the job in a sense, but it’s, it’s the fact that I know everything that was playing against me. The fact that I’m the founder, that’s why I called the founder dilemma. It’s literally that you just know too much for your own good. And that’s just, you know, I’ve seen different. Different leaders. If you look at Amazon Facebook, Google, Microsoft, the founders did remain as a CEO for a very long time. I think that can be done. I just think it’s a bit more rare.
Gene Hammett: Yeah. It takes a lot of self-awareness to realize that you’re going to play a different role in the company. And bring in someone else, pay them a lot of money and give them probably a lot of equity to make this happen, to get the right person. But you had done a lot of deep thinking around that. What does that look like for you? Did you take some time away? Did you schedule time? What, how did you make it happen? ,
Nir Polak: The process is complicated, but like any other CEO searches, but the way it was very simple, the company comes before Nir. And then you ask, what does the company need? And it makes it very clear. And Chris, when knowing the company, you’re talking about the employees and the company, you’re talking about the investors, you’re talking about, your partners, your customers, and that just, if you put the company before you, it all crystallizes pretty quickly. And that’s also true when it comes, you were asking about dilutions or things like that. It is still the right thing for the company because they’re going to be building additional value for all stockholders, for all of the customers, and partners for everyone.
Gene Hammett: Now you’re not leaving the company. You’re not going off to start another thing as I understand, you’re going to stick around. And what would be your role going forward when this stage to CEO comes in?
Nir Polak: So, yeah, the CEO’s already in and the role is focusing more on the product side of the house, helping with the strategy. It’s the things that I, you know, I love and close to. I know helping drive, , the execution of our strategy. Those are the things that I’ll be spending more time with as well, as of course, by the chairman of the board, you have to spend with a lot of board-related items.
Gene Hammett: What, what did you give up in this? Cause I know you’re gaining a lot by focusing on things that you probably love to do that the company needs, but the CEO is taking over things that you used to do. So what are the things that you gave up?
Nir Polak: A ton, everything finance to get to the customer success, to the sales, to the marketing, it to legal it’s a lot. So he owns everything. So a big, big, big chunk.
Gene Hammett: And how long did it take to make that transition?
Nir Polak: Of the, of the position.
Gene Hammett: Yeah,
Nir Polak: It happened immediately because we’ve been working on it with Mike, Mike, Michael to Caesar, , is my successor. And it’s not something that came out of thin air. This is something that we’ve been working on for months and months and months talking about. What are we going to do? How the change is going to happen? How are we going to announce it and all these different things? So it was a very, very natural change.
Gene Hammett: Has this changed your stress level in the company?
Nir Polak: For sure? Yes. It has my own psyche. Yes.
Gene Hammett: Is it truly putting you in a position to do the most valuable work for you and given your strengths and your talents?
Nir Polak: Yes, it is doing giving, using my talents for the best benefit of the company. For sure.
Gene Hammett: That’s a hard thing to, to, to be able to give up all the day-to-day role. You know, the identity as a founder is a very deep-rooted way of seeing yourself. I’ve been through this since I started my company. , but you’re willing, to shift away from this to play completely different role in the company. when you think about your identity, was it hard in any way to, to, to make that shift?
Nir Polak: Yeah. People ask me that a lot. No, it felt very right and natural. And I go back to that Northern star of put the company before you Nir is an Exabeam. And Exabeam isn’t Nir. I created it’s like a child. Okay. I’ve you know, it’s mine. I grew it. I taught it. I’ve scaled it, but it’s about time that they, moved to the next phase and that’s completely fine. I don’t feel that I am defined by my creation.
Commentary: Nir just said something really interesting. You should put the company before you now, how often are you willing to say that you do that? You may say it, but are you really doing it? We make decisions about our own compensation. We make decisions about how we’re going to distribute equity and you know, what the next moves are. And maybe you’re really young in your company. And you have made these decisions, knowing that you’re doing what’s best for the company, but at some level, you probably think about what’s best for you to Nir was talking about doing what’s best for the company and making sure that he made the best decision for the company. In this case, it was stepped up. And bringing in an outsider to be the CEO of the company so that he could focus on other areas of the company that would allow him to do his greatest strengths and add more value to the company and not be limiting the company because of what he knew. That’s a really big one. And that is a very strong decision to make the ego-less founder is the topic of this, but he set his ego aside to make that decision and do what’s right for the company. I’m putting a spotlight on it here for you because I think it will help you become an extraordinary leader. If you’re willing to look at it from that perspective effective back to Nir.
Gene Hammett: You know I lost everything about 11 years ago. And you know, my story from being on the podcast before and I losing everything in a moment, I didn’t have a chance to adjust to it. My identity was completely rocked and I’ve talked to a lot of people after the sale of their company, they moved on to something else. And they were lost and they were really struggling. I mean, I know it sounds good to get lots of zeros in your bank account. You can travel, have freedom. No, no more stresses, but their identity was a con it was a complete hit. Was there something you did to prepare for that before this?
Nir Polak: Yes. Yes. And we may go to sensitive places for sure. So for the last couple of years, I’ve been spending time with a therapist that specializes in CEO’s and we can do a whole separate podcast about this, but, it is very much your life, your work. And what does it mean when you, when you want to say divorce from your work in a sense. And who are you? And who’s at a company, but because I’ve been so prepared for it, understanding what’s going to happen. It felt very natural. It still is. I’m not, I really love what I do. I love the company and I feel really at peace with it.
Commentary: Hold on for a second Nir just says something interesting. He has a therapist that specializes in CEOs. Now a lot of the work I have done has been sort of borderline, deep, psychological work, and I still stay in the coaching world. I still help you move forward just as coaches do. And I specialize in working with CEOs. But I do believe that you’ve gotta be willing to do the deep work. The deep work, as you see it is really about deciding who you are, what you stand for, and really making decisions from that place. B being willing to let go of the way it’s always bent, being able to face your fears, being able to figure out how to bring more confidence into what you’re doing. Be more courageous. That’s the deep work. The strategy work, sell more right market in a different way. Go buy a company. Those strategies are very important, but the deep work is what will really make you shine. As a CEO, create the space for you to be the leader that you really need to be. All of this happens because you’re willing to work on yourself, do that deep work, and do it with someone that can help you move forward. I specialize in this and my practice as a coach. And if you think that’s a good fit, you want to reach out to me and welcome that opportunity. I’d love to help you any way I can back to Nir.
Gene Hammett: Nir, I don’t. I don’t want to unpack the things that you hold dear to you and are very private. Through this, but do you feel like going into the deep aspects, of identity and your own internal thinking has helped you become a better leader for the company?
Nir Polak: Yes. A lot of leaders have high IQ, high empathy. They analyze themselves all the time. That’s what they do. They’re their own shrink. It is. You have to understand what a company and the stress of a company is going to take you sometimes to the darkest places. Of who you are and you know, your beliefs, your attributes, all of it. And, , everybody copes with that very differently. , I spot it at one point I needed help. I can see myself going into a dark place that I said that’s bad, you know? And then you figure out that it’s not just you, the stress that happens at a lot of other companies, my decision to look for success. I had nothing to do with that because of long gone kind of felt very, very comfortable in the CEO position. But also I use these weekly meetings that I have to prepare for a transition. What’s going to happen to me, Nir gonna use, lose control, how you react to it. What does that mean? All of these different things.
Gene Hammett: Well. I appreciate you sharing just a little bit behind the scenes there. I want to go back into this. Why do people get stuck with it because you thought about it before you made this decision? You had to go to the bar. Did your board kind of, were they completely on board or where they were a little resistant to what you’re ideally,
Nir Polak: It’s never like this smooth day. When you go to your board and talk about it. The reaction of the board is Nir you’re tired. Are you tired Nir your time? You should take time off Nir. And the second it’s that type of conversation you’re burned to death. And I said, no, no, I have the energy I’m here. I’m not going anywhere. , I truly believe. That this is the right thing for the company. I truly believe that if we want to unlock our full potential, when you’re sitting on this amazing market and you’re leading this market and a lot of goodness happens, you can look around the corner and you can really see what’s going to happen. And to me, I was adamant, I told him I’m adamant that we need to find someone and then we’ve got a line. And then you, you start the process.
Gene Hammett: It’s a fantastic story. I’m glad it’s worked out well. What would you say the biggest benefit of this, to the company has been?
Nir Polak: Look, the w when Mike came, you can see he’s very seasoned. He comes in. Well, thought when I was looking, we didn’t talk about what type of CEO is looking for, but I was looking for a CEO that understands the market. I plan has been a public company. CEO has a great culture fit with me in the company. We spend a lot of time together. But as much more mature in his view has seen much bigger scale and can really feel the difference. He is just laser-focused on what matters. And doesn’t spend a lot of time in the minutia.
Gene Hammett: I got to ask you this. What have you learned from someone that has that maturity of running a bigger organization? That you feel like was, has been very beneficial for you as a leader?
Nir Polak: The ability to distill, what I call the distill the bullshit out of, really hone in on the top one or two topics that are going to be the most strategic things for the company to execute on and the way they come to that decision, they, they ask a lot of people, they learn about the business. They start building a point of view and, Mike did it very quickly. Very, very quickly.
Gene Hammett: And so his first, I don’t know, how long has he been on with the company?
Nir Polak: 30 days now?
Gene Hammett: So 30 days he’s already made an impact that you’re, you’re willing to talk about it because we set this up just like, you know, a week or so ago because you felt like this message needed to get out to the world. I want to let you wrap this up with what should other CEOs be thinking when they start to feel what you felt and concerned about bringing in an outsider to run the company to that next level.
Nir Polak: Yeah, look, it’s a very scary thing. I think the first thing they need to understand is. The company is not them and they created it and the company is bigger than them. And there’s a lot of other people that are on the boat. The second thing is when you do look for a CEO and you are intending to stay in the company, you really need to hear about the personal, match the chemistry between the two, between the founder and that CEO. And then it feels very, very natural. That’s, that’s my 2 cents.
Gene Hammett: Well, it’s probably not the easiest thing in the world to find being honest, because there’s a lot of people out there that wouldn’t have fit. , I don’t know if you had to go through that whole process, we weren’t going to unpack the whole selection process because I’ve really felt like the heart of the story was about you have being self-aware enough to know when to let go of something and bring in someone else that could take you to the next level. And allow you to focus on what you do best. So thank you for being here Nir.
Nir Polak: Thank you for having me.
Gene Hammett: Well, I want to wrap up just a little bit, taking away from this conversation. I’ve been looking forward to this for a while years. Nir has been on the show before 650 employees, a fast-growth company, a fast-growth market. And when he came back on with this idea, I was like, yeah, let’s tell the story. You’ve got to be willing to let go of what you have today, so you can create something bigger, better, make the impact. I think it’d be better for you as a leader, I think would be better for the company. I think we’d better for the market if you’re willing to, to really evaluate and let go.
And I think what you should take away from this is, you know, what’s best for the company. Not what’s best for you. And if you make that decision, it can really be honest with yourself. You can be a strong leader. And that may mean you continue on as a CEO. Maybe it means someone else does. If you’re not sure what your next steps are as a leader, I’d love for you to check out my website. Let’s talk about your next steps of evolving as a leader. This is what I do day in, day out. It’s going to genehammett.com it starts your journey. I’d love to help you get clear about where you’re going next. When you think of growth and you think of leadership, think of Growth Think Tank as always. Lead with would courage, will see you next time.
Disclaimer: This transcript was created using YouTube’s translator tool and that may mean that some of the words, grammar, and typos come from a misinterpretation of the video.
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