The Funnel Way: How Transparency Drives a Most Loved Workplace®

Today on The Leader's Show, we're joined by Fredrik Skonska, CEO of Funnel, the marketing intelligence platform trusted by global giants like Uber and Adidas. Fredrik's leadership philosophy flips the script on traditional management. He believes the earlier employees get access to real company information, the stronger the trust and the faster the growth. At Funnel, transparency isn't just a buzzword. Is how they operate at scale, keeping teams aligned, motivated, and proud to work there. That commitment has earned Funnel a place among the world's most loved workplaces, and organizational psychology backs him up. When leaders lead with transparency, engagement and performance follow. Stay with us. This one's packed with takeaways that just might reshape how you lead.

Care about each other and we care about the customer.

And that is the one legacy.

That's the name of the game. And by the way, it's, it's not up here.

It's here.

It's in the heart.

Frederick, great to have you here with us today, really diving into this topic of transparency and, you know, leading a culture that is, uh, it's not too soft, right? It's equally respectful of each other, where we've moved since COVID sort of this employee-specific, employee-centric, to more human-centric— us, each other, working together with transparency and trust. And I'd love to dive in that with you today. First, I'd like everybody to know more about you and Funnel, right? I want to learn about Funnel, what you do there, uh, so we can get grounded in it, and then look at the awesome growth you're having each year, around 10% increase in employees each year. So people can be thinking about, should I be working at Funnel? And, uh, so let's start there. Nice to see you.

Yeah, thanks too for having me on the show. Um, yeah, so Funnel, so we are, we are a marketing intelligence company. We work basically in the intersection of marketing and data, and we basically from the beginning sort of started helping companies answer the question of how is it going, how is my marketing going. Now that's kind of work itself into a big platform that solves the whole workflow around marketing data. So starts actually before the data, starts with governance— how do you set up your campaigns and budgets and targets and governance? Then you have to import the data, make it business ready, and then actually comes the difficult part of attributing your marketing activities to results, and— or your results to your marketing activities, which is now actually an AI data science problem. You have to activate the data and then you have to report on it. So we kind of solved that whole problem for everything from small e-commerce companies to some of the world's largest global advertisers. And you mentioned a few of them.

You said, you said AI data. Just to go into the tech, it sounds like it's, it's, it's exceptional in that way. What, what are they really loving about it? What, what's the— tell me, because you have a great background. I'm sure you did some amazing innovations there at Stanford. So tell me more about that exceptional work you do at Funnel 2 for companies. Why should they go to you guys?

No, absolutely, yes. And you know, there are a lot of solutions you can go to. There are small sort of more simplistic solutions. But if you're really serious, if you're really serious about reporting on your marketing data and really understanding the effect of your marketing, if you as a marketer, and the great thing about digital marketing is there is data. So now as a marketer, for the first time, you can show the true impact of your marketing. But if you do that, then you typically come to funnel. So, you know, there's about $700 billion of digital advertising every year, and we report on about 11% of that. So about $75 billion worth of advertising and growing. So yeah.

So you guys aren't overachievers over there. It's pretty extraordinary. That large percentage of that, of that, wow, of that pie, it's incredible. So let's dive into what the show is all about, which is culture transparency. And so we can learn more about it. You know, I really would like to look at that sort of the origins of it all, right? Because most leaders think of transparency as dangerous, right? Don't be too transparent. Don't say too much. Right? Or they feel like they're being told they have to be, you know, more soft on employees, right? And there's not enough transparency and openness and honesty about what we really need and want inside of our economy. So let's dive into that, right? So you said it becomes harder as companies scale, right? And yet you've made it central to your leadership. So can you walk us through those early decisions you made at Funnel and to build that trust-first culture?

Absolutely, yeah, you know, and I, I think it kind of goes back to, to, you know, how I like to work myself. I work best if I have the most information available, and I am very interested typically in how everything works. And I wanted to create that, or we wanted to create that culture also in our company, and, and kind of felt that, you know, A lot of things are supposed to be in a certain way. They're supposed to be secret, or you're supposed to only make things available. But does it really matter? And how far can you take that and how can you stretch it? And so, so we really from the beginning started with a super transparent culture where we will share with our employees how things are going, our revenue, our company metrics, our financials, even when we have taken in financing rounds and they want to do due diligence. You know, we have done that in open Slack channels and everybody's been able to see the questions and how we answer them. And employees have really enjoyed that. When we have conversations, you know, like many companies, we use Slack or Teams, and but we don't do it in like compartmentalized chats that are only available for certain people, but in open channels. So anybody who wants to can join a channel and listen in and see what's happening. And people are really enjoying that. We have open calendars so anybody can see what meetings everybody has. In fact, when my new executive assistant started at the beginning of this year, she looked at my calendar and she's like, oh my God, these meetings are open. That's sensitive. And she started marking them private. And I had to tell her, no, please don't do that because if I mark my calendar private, then others are going to start doing the same. And then we don't have this transparent culture. You got to actually look at, you know, your culture deck and say, what does it say? And then you got to live up to that. And if you don't do it as a leader, you're never going to drive that culture. It's just going to be something you talk about. Absolutely.

And it helps for the global scale to ensuring that it's the same across all, all aspects. And I can see your general Slack channel being amazing. I'd love to see what, what's happened there. We have that, we have a general channel as well, and a VPI team, MLW team. To have that kind of level of discussion on a general team and also for your calendar, wow, that's awesome. And you get to see if people are actually doing work or not.

Yeah, I mean, to be honest, it also goes both ways. Um, I mean, we also ask our employees to be transparent and be more public and be more participating. So, you know, we have weekly meetings. We don't want them just to be like, you know, dissemination of information from, from us, but actually there, there to be questions and discussion. And, um, and so, you know, we— it's, it's a, it's a give and take. Um, and, and also we ask our employees to feel comfortable, and not everybody feels comfortable if they have a question to post it in more open forums and so on. So, um, yeah, absolutely. But, but when you achieve that, it, it makes a difference. It's something that our employees say that they really appreciate. And, and, and to the point where, you know, we have talked about that we will eventually, you know, list ourselves on, on the stock exchange, become a public company And people think that's— our employees think that's great, that's a milestone, but they also worry what's going to happen. Can we be as transparent then? Um, because that's such, such a big part of, of who we are.

It changes dramatically once the SEC gets involved.

Yes.

Yeah. And you've reported really high ENPS scores. I wanted to dig into that because it sounds like this is a part of it in terms of your employees really loving it and promoting to other people really to work there, you know, especially a world where top tech has a lot of options, right? They can go a lot of places, you know. What does that transparency help with, or what other aspects do you think that's helped with in terms of people loyalty or even team performance? What have you seen?

Yeah, absolutely. Yeah, so no, so we have had exceptionally high employee net promoter scores, um, you know, consistently, and And that's something we've been super proud of. And, you know, for many, many, many years, like we didn't almost have a single person who left the company to the point where somebody, when somebody actually ended up leaving, you know, we didn't have an offboarding process. We hadn't done this for such a long time. So, you know, so we, it was really a very appreciative, you know, place to work. And it's, and so, you know, I, and I think the culture is a really big part of it. I mean, for us, culture is, is about transparency, uh, it's about teamwork. It's something that we, that we put really high up, uh, with a learning culture, um, and we, you know, really focused on creating, um, a friendly workplace. Um, friendly but not to be confused with, just as we talked a little bit about, uh, just, you know, just being a soft, soft, um, environment. We are a performance culture, really high ambitions. We want to meet it, move at speed, and create wow for our customers.. But we really want to be friendly, meaning that something goes wrong, we lean in, we help, you know, and we join forces. And it's a place where you, you know, where you enjoy performing and working hard together with colleagues for many, many years. That's what we feel like we want to create. And actually also, I think, have pretty well succeeded in doing.

I think that's really the key, isn't it? Like that difference between being soft and saying, oh, why don't we just all take vacations, go take off time, do whatever you want, which is fine. Fine, but if you're not a high performer, if you're not bringing things to the table, you're not doing well, you're not iterating, it doesn't really matter, does it? High performance means it's part of the culture. It's part of what we do. It's part of how we are. It's part of how we show up. And transparency requires that. So, I see this movement happening more and more with companies. And the more I talk to CEOs about this, there's something really true about this. Which is we're moving away from a culture where we're just cowtailing and we're at the beck and call of other people. We're saying, I'm here too, working. I'm giving, I'm investing. Are you? What part of it are you doing? Or are you just here to, uh, do social loafing, which is organizational psychology concept, right? It's real. I'm just hanging out, loafing on the success of others. It's okay, just keep going, right? No, that's not what we're about, and that has to be called out immediately, doesn't it?

Yeah, no, absolutely. Um, and, you know, I mean, that's— I think that's been a journey for many companies, especially during sort of 2021 when, you know, we all added a lot of people, um, to the workforce. And, you know, I, I think now when times are a bit tougher, um, it, it sort of the pendulum swung very strongly from employer to employee, and now it's sort of come back a little bit, which I think is healthy, but I think in a good balance now. But definitely now there's a big focus in organizations on performance and sort of moving at speed and being a little leaner, a little faster, which I think is actually very healthy.

That's right. And I see it throughout everything, vendors, relationships, clients. Let's, let's get a balance to how we are in life. Not just one way, it's both ways, it's collaborative. So that's really important, awesome things that you're bringing forth. Some specific practices. So let's make it real. How do you operationalize transparency at scale? You mentioned Slack channels, you mentioned open calendars. Open book discussions. Is it more than that, right? Are there rituals or practices that you use to make sure it's actionable day to day? Anything else you use?

Yeah, I think that by default, everything is open. I haven't— for the first probably 13 years in the company, I didn't have an office. I sat with everybody else and spent most of my time sitting in the kitchen so that I could meet as many people as possible. And you just have to sort of— it's just a constant practice of whatever we do, let us do it with transparency first, transparency in mind. Is this something that actually is— is it re— like, what would happen if we shared it? Probably nothing. So, you know, we, um, spend a lot of time every year coming up with a strategy for our business. We look at, you know, really kind of where is the industry going, um, competitors, um, partners, where is the opportunity. And then, you know, sort of at the senior level, we write that down in like a 60-page document. That is probably the most sensitive document we have. Like, we mapped out an entire lot of strategy of, of how we see it play out and how we are going to win. And then we share it with the entire company, um, because that is probably also the most important document for everybody, entire company, to read. Because with that they will understand in great detail how we are thinking about where we want to go, what we want to achieve, how we can do it. Um, and you know, that is the best we can do.

What do you call the 60-page document internally? What do you usually—

what do you call it? It's our strategy document.

It's your strategy. Got it. And then do you have— I was just curious, I'm thinking of this document being handed out to everybody. Are there, are there ways that people, uh, reflect and analyze and report back out, or some way that they're kind of internalizing it so that you can feedback what they're thinking too?

Yeah, absolutely. I mean, it is a, it is a Google Doc, so it's not actually printed and given to them, but it's a Google Doc. And actually, the first time it goes out to them, which is also part of how we want to work, it is a draft, and it goes to the employees as a draft before it goes to the board. And the employees can then actually all our 350 employees have access to it and can actually read it and provide comments in the document and feedback. And then we take that into account. Some of that feedback is really, really good because they understand that specific part of the business really well, and some, you know, maybe isn't really on the mark, and that's totally fine. And then And, and then, you know, based on that, then, you know, we take it back and then we readjust the document and then, and then it becomes a final version. So absolutely, yeah, it's interesting.

I can imagine you sending out this Google Doc, somebody looking at a little section of it and then commenting and then tagging you and assigning you to it.

Yes, absolutely.

Right? Isn't that cool? Like, you can, you assign Frederick, the CEO and founder, to a specific thing to give more comments, which is super cool. That's what people want. People want that kind of transparency. People like that.

People enjoy that they can actually have that conversation, and, and specifically, they're also directly with me on specific strategic issues. So yeah, so that's one of the things we do. You know, another one is every 6 months we run an employee survey and we ask our employees, you know, lots and lots and lots of questions, uh, and ask them to provide feedback and comments. And they, and they, and they you know, we have— I think we have 89% of the employees answer it. It's a super high engagement. Um, and, and then, but then we report it back. Um, you know, now as we said, you know, we have very good, um, satisfaction scores in our employees in general, but not everything at any time is, is positive in the company. There is going to be things that are negative and things that are getting worse. And then we talk, we say that, and here's the score, and this got worse. And then we talk about that, and people appreciate that. It's like we don't just show them the high-level metrics or the metrics that are good, but actually, you know, the good, the bad, ugly, everything, so that it's fully transparent. And that also people really appreciate.

A lot of people, companies we have, you know, they take in the information from Level Workplace Index, the, the best ones take the info, find the positive and the attributes that they need for feed-forward, the negative, and they immediately get back to people, right? And we always talk about rater fatigue. People— why do people not take surveys more than once? Because they get sick of it, because nobody does anything. Yeah, right. Nobody does anything about it. Sounds like you're different.

Yes, yes, absolutely.

And that's really the competitive advantage you're talking about. You know, some leaders see culture really as a soft variable, right? But you framed it as a competitive advantage.

Yeah, I think there are two really important things. I think culture is really important. The other thing is that, that I think is really important, I've always felt is underdeveloped, especially in companies like us, technology, fast-growing technology companies, leadership development. And so those are two things we focus a lot on. And so, you know, we now have a 9-month leadership program that all our leaders go through with a set of modules. And then when we do our surveys, the different individuals score their manager as well. And we have also actually exceptionally high manager satisfaction scores now, and they are moving upwards. And that's something I'm super proud of because that's something I always felt in tech we weren't quite getting right. It's like a company is growing really fast. You come in early, you're the one who knows it the best. Then you get promoted. You've never run a team before. You kind of mimic what your manager did, but nobody really actually trained you how to be a good manager. And I think we're doing that really well now.

And development is key. Growing your talent is key into, into what you need for the business, for that 60-page Google Doc. Before you go to the, the board, right, which is so important. So if you are mentoring a founder today, right, you know, building a startup, what's the one thing you tell them to do early on to build that trust and culture right away?

Well, I think it is to, to, to, to take a step back and actually, you know, also focus on the culture. And I think it's especially important today in today's sort of AI-driven world and the frenzy around AI and startups and everything is growing faster than before and you're feeling like you're missing out unless you move miles every month. Actually reminds me of like '98 through 2000 when I was in Silicon Valley, which was amazing. Take, take a step back, focus on culture. Now I think the important thing with culture is you can't sort of just Google culture decks and then take one that looks good. Um, I think the cult— there has to be like a founder-company culture fit. You gotta kind of figure out what it is, and it may change a little bit over time as you get more mature. If you are a young founder, how are you actually going to know what, what you think the culture should be and needs to be? Um, so I, I think that's also okay to sort of over time mold it, uh, in the direction you want. Now the other thing is that it is so easy to say culture is important. It is so easy to write a culture deck and say we have a culture. And then actually what you really have is something very different. Um, and that's like, and that's kind of when I, when I, we have a welcome program that all our employees go through and we spend a lot of time on that. That's very important to us. As part of that, I, I give a presentation, I talk a lot about the culture. Um, and, and then I, at the end, I, I sort of, my ask is like, I want to meet you guys in 6 months. And then I want you to tell me what has your experience been now? Have we actually lived up to this? Actually, a lot of that feedback is yes, we are actually living up to this. Actually, I did the welcome program. I've been here a month. Actually, what I've seen so far in the organization reflects what you're saying very well. Actually, I'm very proud of that. But that doesn't come automatically. And really what I think is the most important thing is every time you've got a really hard decision— and what is a hard decision? A hard decision is something where you don't know what the right answer is. Like, you just don't know what the right answer is. You sit there and go, this is mission critical and I don't know what to do. Then actually you should take out your Culture Deck and you should say, what does this tell you that you should do? And unless you do that, and unless you actually do what that culture deck says, it doesn't really mean anything. Then you should change the culture deck. And so we've done that a number of times. You know, we had, as I said, teamwork was the most important thing, or one of the most important things, together with transparency in our culture. And, and we felt like, you know, it started to degenerate and we didn't quite have it anymore. We had like, you know, the product team was complaining, the sales teams were individualistic, they were selling, you know, because they had a bonus and, you know, and there was so much complaining about this and bickering about like who gets what lead and so on. And we said this doesn't work, this is not who we are. We are working together to solve problems. And we actually, as a software company with like 70 people in Boston, US software sales, decided to eliminate commissions and bonuses in sales across the company. And this was hugely controversial. People told us, you know, you're not going to be able to hire any new employees. The ones you hire are not going to sell. All your best employees are going to leave. And the ones who stay are not going to sell a lot. But we did it anyway because we felt there would be so many benefits to having like this teamwork culture. And, um, and it turned out, it turned out really well. We kept selling and now people are team selling, they're handing over leads to each other when they go on vacation, or deals that are halfway through. Um, and, and like there is huge teamwork within the company.

I was going to add that to the beginning of the show because it's the most remarkable thing I've seen. I've never seen it before, and, um, it's extraordinary. And I'd love to dig into that a little more because I know a lot of people would like to know more about how you create a non-commission-based sales structure, team-based sales structure. Um, I couldn't validate it before. I wanted to make— because I didn't— says this is true, you actually have a non-commission, non-bonus structure for sales, and it's team-based. How does that happen when there's people who like aren't, aren't, uh, they're not trained in sales, right? Um, how do they sell, you know? How does that happen? How do you do that?

Well, they are— I mean, every— everybody in our sales teams are professional salespeople who've long sales experiences at other companies. So, yeah, and, and they come to Funnel and they move from a commission model, uh, very individualistic focus, you know, to, to, um, to a model where, where you're going to get paid. And it's not that we're paying people— like, it's not that we're taking, taking their commission away. You could say we pay their commission, we pay their full OTE every month. Um, so you, you get paid every month what your, your OTE is, um, and that's fixed. Um, but we do pay it irrespective of whether you bring that huge deal in that month or not. And why do we do that? Well, we do it for two reasons. The first reason is because what you reward is what drives behavior, and it is really hard to parameterize what you want a salesperson to actually do. Yeah, you want them to bring in business, but you want them to feedback information to product teams as well. And you don't want them to close the wrong customers who are going to churn, and you don't want them to just focus on, um, you know, the, the specific deals that would, would be most profitable for them. You want to close all leads and, and so on and so on, right? Um, so, so, so that's one of it. And, and actually, instead, creating this environment where actually they can spend 10% of the time helping others and, and handing things over and so on. The other thing is also this research that, yes, on very manual tasks, like if you do the same thing over and over again, if you get a bonus, you'll work a little bit harder. But on cognitively complex things, if you give people a bonus to solve them, actually they do worse because they're kind of stressed out about it. Actually, enterprise software sales is pretty complex. Seems to me that that should then not have that bonus. So that's what we do. Now, I speak about that sometimes in conferences. I get a lot of questions about it. People ask me if they should do it. And you know what the answer is? Like, it's a pretty big step. Like, think really carefully about it. We did it. It worked really well for us. We're really proud of it. Um, and most, most enterprise software companies have commissions.

Um, and it seems like you did it in a phased approach so they could see the before and after of it, right? So is that true? You didn't start like this, you developed commissions first?

Yes, because we— everybody has commissions, and that's how we thought the world worked.

It turned out though that when you took that away and you enabled a more team-based structure. They got the same commissions, but it was, it was more of a team collaborative environment. Is that true?

Yes, it's true. I mean, we had, we had, we still had, we continued to have strong performance. And, um, but, but, you know, the whole bickering about leads this and leads that, or now we're making changes and changes to the product or, or changes to leads or changes to people's roles, and then they want new commission, this and that. All that went away. So everything is just focused on selling, and like those 30% of the time that went on, on this other stuff just went away. So, um, yeah, so it's had a lot of good benefits. Now what I would say is that it doesn't mean you— it doesn't mean you don't need a high-performance culture in sales. I would almost say it's even more important to have a high-performance culture in sales when you don't have commissions. And, you know, so we have individual targets for each salesperson that they are held to, and, and, you know, that they get reviewed every month based on their performance. And, you know, so we hold our sales teams to strict targets, but they will make— it won't affect their daily salary or their monthly salary. Of course, if you over time perform well, you know, you will be lifted, you'll have a higher salary increase, but not at the level of bonuses. Um, but that's just what we do in product or in customer success or anywhere else, other roles, finance. Like, we hold people to really high standards, you know, we push them and we work with them and we develop them and we manage them. Um, and but, but you have to do that And you specifically have to do it very closely in a no-commission sales environment.

This is great stuff. You know, I have a feeling a lot of people would have a lot more questions around that because I know they'd probably want to do it right, want to have such a high-performing sales team in their own companies. You've really said it all. It's really great stuff, Fredrik. Thanks for showing us really what it looks like to lead with this kind of clarity, courage, and trust, really. You've done a fantastic job at Funnel, and, uh, its story really proves that, you know, love, leadership, and transparency aren't opposites. They're all part of the same game. Thanks, Frederik, for joining us.

Well, thank you so much, Luke, for having me on the show.