From Four Employees to 3,000: Shopify’s Rapid Growth Has Meant Constant Change for Its COO

Harley Finkelstein knew he wanted to be an entrepreneur when he was in college, trying to figure out how to make his t-shirt business stand out from the crowd. While there, one of his mentors suggested he go to law school to learn how to be a better entrepreneur.

So he decided to go to law school and get his MBA. And along the way, Harley met Tobias Lütke, who just happened to be the founder of online sales platform Shopify. Harley became one of Shopify’s first customers —  using the platform to set up shop for a second t-shirt business he ran during law school.

Harley claims he and Tobi are polar opposites, with Tobi the introvert and Harley holding the more outgoing personality. (If you don’t know Harley from his role at Shopify, you might recognize him as one from the CBC show “Dragon’s Den.”)

But something clicked between the two, and in 2010, Harley moved to Ottawa to help Tobi and co-founders Daniel Weinand and Cody DeBacker grow Shopify. It was then that Harley’s journey as a COO began.

In a conversation for the Second in Command podcast, Harley shares how his role has grown as Shopify has exploded from a small ecommerce platform to one with 3,000 employees and 500,000 online stores.

Embrace the evolving role of the COO

When Harley first joined Shopify, all he knew for certain was that he would focus on the business side of the company, whereas the co-founders were more focused on the product and technical aspects. “I remember thinking that my job was finding the things that they either didn’t want to do or didn’t know how to do,” he says.

He describes his role in his first few years at the company as the “Swiss Army knife.” He even helped raise $7 million in Shopify’s Series A financing round in mid-2010, when the company did not yet have a CFO or general counsel.

“That was my first introduction to being in a chief operating officer role … which was that my job isn’t necessarily this one thing, and do only that one thing,” he says. “It was figuring out the gaps of the company that were going to prevent us from getting to the next step, the next level that the other three [people] were not tackling.” 

That willingness to jump in wherever needed while building teams for partnerships, business development, and marketing has surely contributed to Shopify’s success.

But doesn’t an extroverted personality like Harley’s overpower Tobi’s as CEO?

No, Harley says. In the early days of the company, Tobi was so focused on building the product side and recognized Harley’s strength in acting as a company spokesperson.  Plus, Harley is comfortable in an ambiguous startup environment — in fact, he credits the lack of order with helping him seek out problems he can help solve.

Let meetings reflect the company culture

Harley and Tobi, even with their yin and yang personalities, put in plenty of work to keep their relationship strong and trust levels high. Harley says it’s up to him to make sure their CEO/COO dynamic is working effectively.

“The onus is on me as the COO to check in with him to make sure he’s getting everything he needs from me,” Harley says. Although Harley considers Tobi a close friend and mentor, he acknowledges that he’s also his boss.

When they review goals, Harley will point out where he’s focusing his attention and ask Tobi if there are other priorities he can take on to help the CEO. “A lot of problems that I hear from the CEO-COO relationship often stem from other misalignment in terms of expectation,” he says.

It’s not surprising that this reverence toward personal discussion of goal alignment flows throughout the company. Harley says one-on-one meetings at Shopify are “fairly sacred.”

But any meeting that grows larger than five or six people — Harley calls these “room meets” — doesn’t hold that same sacred status at Shopify. He says every person in every meeting should question whether the meeting should be happening at all. Are the right people in the room? Is the objective clear? If not, call it off, he says.

“There are no rules of engagement in terms of meetings at Shopify,” he says. “There are no commandments of how meetings should run.”

By embracing the entrepreneurial mindset of Shopify’s mission and giving team members autonomy, they can ensure their time is well spent and in the benefit of the company’s goals.

That power — which is also a responsibility — is a part of Shopify’s strong culture that makes it one of the hottest companies across Canada for talent. And while the company has some great perks, like chefs and house-cleaning services for employees, Harley doesn’t count that as culture.

“I would say that culture is probably what people do when no one is looking,” he says. “What happens when no one’s around and people are left to their own devices? What do they do? If they do the right things, you probably have a great culture.”

Get out of your own way to ensure growth

Harley served as general counsel of Shopify until about 2014. “I wasn’t a good general counsel,” he admits, but he was the only lawyer there and so he filled the role. When the company started thinking about an IPO, which took place in 2015, it was clear it was time to take that task off Harley’s plate.

“It was not something I enjoy doing and it was not something that I believe that I could do better than anybody else,” he says.

He spoke similarly of the experience of building an enterprise product, which Tobi wanted to build after watching small businesses grow, but ultimately stay with Shopify. Harley created some scaffolding to make sure the product was a solid fit for the market.

As soon as he was certain there was a need to fill, he brought in VP of Sales Loren Padelford to run and scale that effort.

“Tobi wanted me to get that started because that’s what I’m good at,” Harley says. “At a certain point, my ability to scale that had diminishing marginal returns and it was time to bring in someone else.”

Harley stresses the importance of fellow COOs to continually recalibrate their roles, responsibilities, and focus areas with the CEO. By reconfirming “Is this still the most impactful thing I can be doing?” they can ensure they’re serving the CEO, the company, and their professional development in the most effective way possible.

This article is based on an episode of Second in Command podcast, where your host Cameron Herold interviews the chief operating officer behind the chief executive officer to learn their tips, systems, and insights from being the second-in-command of an amazing growth company.