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Joining an established company as the new COO is great, but getting in when it is just about to face transitions is an even more fulfilling challenge. Our guest today is Dana Arnold, the Chief Operating Officer at Measurabl. Dana oversees business operations, including human resources, accounting, finance, legal, strategic partnerships, customer success, and international operations at Measurabl. Driving company growth, Dana has led the company through two early-stage venture funding rounds resulting in over $20 million in cash to the business and implemented processes that drive further growth while setting a bottom-up strategy to foster a culture of transparency, harmony, influence, and integrity. Dana shares her personal growth while supporting the vision of her CEO, Matt Ellis.
Dana Arnold oversees business operations including human resources, accounting, finance, legal, strategic partnerships, customer success and international operations at Measurabl. Dana has led the company through two early-stage venture funding rounds resulting in over $20 million in cash to the business. She implemented processes to support customer growth by over 270% in monthly recurring revenue. She maintained employee net promoter scores in the high 70s, which in industry, an excellent benchmark is 50. She has also taken the company through tremendous growth stages in the business.
Dana is passionate about the solution that Measurabl is bringing to the market, scaling businesses, building a strong company culture and supporting innovation around protecting the environment. Prior to Measurabl, Dana ran two departments, a twenty-person services team and a four-person customer services team at Goby, a tech-enabled real estate consultancy. While at Goby, she was instrumental in building strategic partnerships, directing business strategies and improving data analysis and tools. Prior to Goby, she supported Aramark, a food facilities and uniform services organization as the Environmental Sustainability Manager in corporate responsibility where she worked across departments to increase operational efficiency and sustainability initiatives as well as corporate reporting initiatives, including CDP reporting. Dana studied Architecture at the University of Michigan. Dana, you have a very cool background. Welcome to the Second In Command Podcast.
Thanks for having me.
Tell us what Measurabl is. Give us a helicopter tour of that and we’ll go back to the beginning and understand why they allow you to come on as the Second in Command there.
Measurabl is the world’s most widely adopted environmental, social and governance software for owners and occupiers of real estate. Our platform supports about eight billion feet of commercial real estate properties, valued around $1.85 trillion across 75 different countries. We help commercial real estate companies and corporate occupiers of real estate to manage, measure, report, as well as act on their environmental, social, and governance data. This data is used by our customers to exceed tenant expectations, comply with government regulations, and a new emerging trend which is getting access to capital markets. From that perspective, we are geared towards utilizing data to enable access to capital within the real estate market and doing that gathering some of the non-financial data that are geared towards managing long risk reduction returns within real estate.
It’s a complicated model. Boil it down even further for me. In layman’s term, what does a real estate mean in 75 countries and $20 million in real estate value? They’re taking the data and what are they doing with it?
There are many different use cases for the data that we help collect. A lot of it is around helping investors get access to data to make sure that they are making good investment decisions. Sustainability, which has been a trend for around a good 30 or so years, has transitioned to this concept of ESG, Environmental, Social and Governance. Sustainability is the concept around, “How are you playing into a circular economy? How are you playing into thinking about the sourcing, composition and end product of everything that you’re doing?” You can apply this thought strategy to any type of business, product or strategy. Our application specifically solves the need within the built environment to collect and act on the data. Our system allows building owners and operators to input their energy, water, projects, audits, certifications, ratings, plans and policies around social governance issues that range anywhere from, “Do you have an employee health and wellness program?” to “What is your governing practices around how your leadership is compensated?” “What is your governance compensation ratio of your top employees and your C-suite compared to that of your lower-level workers?” It covers a wide range of data stacks and we help to make that simple and easy.
From that, you’re probably asking, “How and what? How do you go about doing this and solve this?” We help automate a lot of data sources within the commercial real estate market. We’ve built part of our application that will sync utility data directly from utility websites. If you’ve got a username and password, it’s similar to Mint.com if you are familiar with it, to be able to sync all that data into one place. You can start looking at energy data all in one place from all the different providers that you might manage across a portfolio of thousands of buildings.
Are your users able to benchmark that data against others in the industry?
Absolutely. That’s one of our core functionalities that people come to us for over 35,000 properties globally that are utilizing our application. We build a peer set of data. Looking at similar buildings, space types, size, age and build a peer set to give them a better benchmark score of 1 to 100. You can see that in real-time on real data in our system how you’re comparing to peers.
They’re now taking the data and saying, “How are they doing versus the others versus what buildings do they own? How are they managing and running them?” You’ve been with the company for a few years. Give us some perspective on the scope of the company as well as Measurabl.
We’ve got three main offices. We keep growing very quickly. We’re headquartered here in San Diego. We’ve got about 60 people total, about 75% of them located in our San Diego office. We have a small office in New York and we have an office in London. We’ve got a global team. One of the projects that I worked on was setting up the UK business, which was a whole fun project going through that. We’ve grown and doubled year-over-year in terms of headcount, not that you want to judge how you’re growing your business space on the number of people.
You’ve pointed out something that I think is an important point to recognize. The number of employees you have should not be a goal in terms of how you measure the success of your company. Having more people doesn’t mean more success. A client that I coached years ago called and one of their goals was to get 100 employees. They had 30 at that time. I asked, “Why is that a goal?” “We’d be bigger.” “You can be a lot bigger in terms of revenue and profitability if you could focus on that efficiency.” They started focusing on that and now, they’re actually there. They’re about 400 employees now but they did it in the right way. Tell us about your background. What kind of things did you see in Measurabl that attracted you to commit as their Chief Operating Officer? What do you think they saw in you to bring you on board as it’s a critical role?
Around the time when I was exploring joining Measurabl, it was about twenty people and still founder-led everything. The CEO, Matt Ellis, founded the company back in 2013. It was around 2017 when I joined the company. He was doing everything from running the payroll, strategically leading founder-led sales, managing customer success, leading the product team, you name it. He was the only business operator within the organization. We were primarily software developers, a few customer success, two sales guys, one marketing person. It was crucial to the business. He had closed a second seed round to fund the next growth stage of the business. When I started chatting with Matt, it was clear that he needed a lot of administrative help in growing and scaling the business.
I was working for a quasi-competitor, Goby, out of Chicago. What attracted Measurabl to me was that I saw his approach to solving similar challenges in the commercial real estate market around utilizing technology to enable scale and growth in this space. When I had the opportunity to explore some new career options, I thought, “I want to work for that guy, Matt. I think he’s solving these things in new and innovative ways.” Typically, sustainability is led by tech-enabled consultants that use a lot of people to solve challenges that technology can’t solve. That attracted me to Measurabl and to Matt, personally. I reached out to him and said, “I like what you’re doing. Can we somehow work together? Whatever you need, I’ll do it.”
It started some interesting conversations in those early moments of understanding the approach of utilizing technology to solve global challenges around climate change. Buildings consume over 40% of energy, we spend 90% of our time indoors and commercial real estate is the fifth largest asset class. The opportunity for huge impactful change around how we handle and prevent climate change is in this core set of challenges. It requires a global solution to help solve these challenges and problems. Consultants in Excel are not going to solve these problems in it of themselves. Utilizing a technology so consultants can solve the impactful change that they need to and removing the data management and the data architecture and some insights centralizing that for a centralized software platform. You can SaaS that. When you have a software platform, you can turn it into a subscription model that scales and grows with customers over time.
You are a SaaS model subscription-based business?
Matt is the CEO, you’re the COO. How did you divide and conquer in terms of your roles and responsibilities? How has that evolved in your years with the company?
It definitely has evolved. Day one was one of those mission-critical moments where Matt was, “I need to focus on strategic stuff and I need to get a lot of these administrative things off my plate. What are the tactical things that need to get done so he can focus a lot on the strategic things within the business?” I have not been in a Chief Operating Officer role. I had experience in running a twenty-person data team that had a fairly large budget. I was responsible for all the hiring and managing of the budget and spending of the cash to deliver on the services. In talking with Matt, “Whatever you need in the business, I’m here. I will do it. Whatever it takes to work with you, I’m here.” We didn’t discuss necessarily the role or the title or anything of that. I remember getting the job offer from him and reading it, “Chief Operating Officer? What?” Having that moment of, “What does this mean?” I remember Googling, “What does a Chief Operating Officer do?” It was that moment of learning that this role is dynamic and different depending on the industry, the business’ needs and the people involved.
I’m coming into Measurabl from a subject matter background expertise of working in the commercial real estate space, working with sustainability in a built environment, from graduating college with a degree of architecture where I thought I would be designing buildings. I’m building software to help make things buildings better. Those moments of trying to figure out, “How can I be successful coming into this world and supporting a young growth organization?” The main tactics during those early days were taking over a lot of administrative functions of the business that needed to get done. You need to run payroll. Some of those are not sexy things, but they are things that need to get done.
How that role has transformed over time was looking at what the next stage of the company was. We needed to fund for that next stage. The first six months into the role was working on our series A funding round so that we could move and accelerate the business forward. That was a fun project of learning that whole world of venture capital and raising money. That was a new experience for me and I’ve through the process twice now. The series A was designed to raise cash to build in a leadership team.
At that point in time of the business, it was Matt, myself and Lance, who is our CTO. He handled all of the software, development work and managing the development team, which was our largest team at that time. We didn’t have a head of sales, no head of marketing, no head of customer success. Those were some of the crucial roles we needed to bring in as well as some administrative members of the team to help accelerate the growth including our CFO, Nicole and our head of HR, Jessica. Those were the key things that transformed my role into getting back into the strategic side of operations of the business.
You’ve been in since the early days. You clearly had to work on your skills as you’ve had to evolve as a leader. What have you been working on to grow your skillset?
The balance between tactical things that need to get done in the business and what are those strategic things that I can do to support the growth of the business. I have a team of people that are supporting the administrative functions of the business. Looking from a business operations standpoint, how are we strategically enabling growth within the organization? It’s easy in this world to get bobbed down by the tactical things that come up on a day-to-day basis. I am coaching myself to be diligent around, “Is this a strategic priority in the business? Will this enable growth with our people, products, customers, investors?” If it doesn’t fit into that model, maybe it’s something we shouldn’t be doing even though it might be something people might expect that someone in HR or business operations would be doing these things. It’s guiding ourselves in a strategic perspective and aligning with business growth opportunities.
Go back and talk to us about your two Series A and Series B rounds and what you learned in that experience. Most companies will never go out and raise money. The ones who do it successfully often never get to the second round and you’ve done completely two rounds. What do you think you learned in the first round? What was different in doing Series B? How have you evolved as a company since raising the money?
When we’ve gone out raising Series A, we were looking to raise cash somewhere in the range of $5 to $10 million. We were going out and starting to talk to our investors. Matt had done a good job in the early seed rounds of getting a variety of seed investors. They may be putting small chunks of money on the table and diversifying those early-stage seed rounds. Finding investors that understood that we were building something that didn’t exist before. There are not true competitors in the sense of building software technology to scale and take into account a global platform around ESG data. It became an art of finding people who believed in the mission that ESG data is important and that they were willing to work with us to build something that is big and great.
Series A is about selling that vision and putting together rough plans for how you’re going to execute on that vision. Knowing at that stage of the company, building a Proforma is a big challenge and understanding what those mechanics will go in executing those things. We were clear, open and honest with our Series A. We needed a management team to help execute and prep the organization for growth. At that point in time, we had been able to get some big companies signing up and utilizing our platform. We had good early market adoption within the commercial real estate sector in the States. We knew there were opportunities in Europe, potentially in Asia that we could get in early stages that didn’t appear to be any competitors around technology space in those zones. Our first Series A goal was we need people that can focus on a lot of these strategic elements of building up the business. We knew that we needed to focus on geographical expansion in those early stages.
Our Series A was exactly what we needed to get those things done. We were able to get almost a full management team hired within about three months of closing the Series A. We immediately established our UK entity to start building up our team in Europe. We were able to accomplish that quickly. It isn’t always easy hiring, especially leaders coming into the business from outside and in that early stages of growth.
From there, 2018 was a key moment in time for us to understand what’s next. We had great opportunities to grow the business in terms of revenue. To grow in terms of headcount, not that it’s not a goal, but you need strategic people in place to think about certain things that are definitely needed. We had interesting opportunities when it came to strategic partnerships. It led us to understand that if we weren’t going to execute on somebody’s strategic partnerships and integrations with organizations globally, we needed to accelerate our ability to build software. While our revenues maybe weren’t dictating the Series B round, we knew we needed to do something and something quick to make sure that we could execute on some key objectives in the business. Objectives which are further geographical expansion, building up a technology to build an integrated platform, and understanding how we start monetizing on the data that we have in the application. You can imagine that we have a lot of data.
One key thing we realized was the direct users of our application need this data to report to their customers, their investors, regulatory regimes that were requiring disclosure of energy, water, waste data. They also needed help facilitating that data exchange process with those different stakeholders. Those different stakeholders are looking for aggregated anonymized data that they can use to build indices from the capital market’s perspective. From those early conversations, we understood that there is a big opportunity here outside of what we originally set out to build a software for. During those conversations of, “Should we raise money for the Series B? We don’t necessarily need it right now. You should always raise money when you don’t need it. There are some strategic opportunities that we could accelerate if we raise cash now, even though we don’t 100% need it today. We might need it in a couple of months on the road.” Talking with our investors at the time as well as looking at those strategic opportunities, it became clear that we should raise now.
It’s all about timing. Raise money when you don’t need it but strategically don’t take more than what you need, is definitely some stuff we learned. Build a good mix of investors in your organization from a mix of strategics and venture capitalists. In this round, we had some opportunity to work with Constellation Energy and SMP as a part of that second round from a strategic perspective. Both of those organizations saw the value in the product as well as the data for how those can impact their businesses. That’s what drove the Series B round, working with those strategic investors and how can we start commercializing our product with new customers in new ways.
Something I heard you saying which was that the opportunity started to be different than what we had visualized in the earlier stages in the business. Did you pivot or turn your attention towards some of those opportunities instead of trying to market what you were building? Did you say yes to the opportunities and fell into that? Is that what happened?
I wouldn’t call it a pivot. We knew there was value in the data that we were collecting beyond what our initial use case was, which was commercial real estate organizations saying, “We need a report on this data. We need a mechanism to gather the data, manage it and report it out to reporting regimes such as Carbon Disclosure Project or GRESB, The Global Real Estate Sustainability Benchmark.” The reason why our customers were needing to report on those things was because there was investor demand for that data. At that time, these reporting regimes were the way to communicate that information directly to investors. I see this in the sustainability market and it could be a broader theme that is existing in the market. What we’ve seen is a shift in looking at how you take these moments in time that might be an audit, a certification, a survey from data. How does that transition into real-time reporting that is more relevant to whoever is looking at that information?
I’ll use an example. Are you familiar with Lead Certification of buildings for the US Green Building Council? It’s logos you might see in big office towers throughout New York, Chicago, LA. That process is time-intensive. There is a lot of data gathering that goes into that. You go through an entire approval process, you go through a certification, you get a nice plaque and you put it in your building. That is how a lot of people have been communicating, how green is their building as if it is a binary, “Are you green or not green?” What we’re seeing is that sustainability and how environmentally friendly you are or however socially impacted your business is, it’s a spectrum. How can we transition in a way that the use of this data instead of it being a binary thing of, “It’s good or it’s bad or it’s green or not green,” into, “How are you relative to peers? Where and how do you fit in a spectrum? What data points in that spectrum are material to you or to your investors, customers, regulatory regimes?” That’s the shift we saw in the market.
If you were sitting in a COO Alliance event with a bunch of other second-in-commands and they’re turning to you as the environmentally friendly expert in the commercial real estate space, what three tips would you give them to take back their 50 to 500 person companies? What would you tell them to do? What are the top 3 from tips from the clients you are seeing? What should they do? What could they do that’s easy?
I think the one question is, “Do you know what your expanded energy impact is now?” If the answer is no, you should measure it. You should measure what matters. Our software also is a freemium model. Anyone can go and log in to Measurabl.com, create an account and start loading in data and get actual insights on what you’re doing. We try to make it easy and think that sustainability is something that everyone has access to. One is, do you know your impact? What are some of the efficiency units that you might do? If you are a consumer-based product company, do you know your energy use per unit of output that you have within your organization? If you’re more of a software company, you might be looking at what is your energy per employee that you’re utilizing to understand efficiencies?
The second thing to look at, which might seem tied into the COO role but also crosses a line into ESG strategies that you can implement, are your employees. Are you measuring your net promoter score with your employees? Are they liking your culture? Are they feeling contributed? Are they feeling good? Happy employees lead to a lot better outcomes. Some companies don’t see how that plays into ESG strategy. ESG is a wide net of non-financial data that you can be collecting. Understanding how happy your customers are, how happy your employees are from a culture perspective, from a product perspective are extremely important to things that you should be measuring. Our application helps provide that information to help reporting framework and regimes with it within the application.
To those who aren’t familiar with Net Promoter Score, you do a poll of your employees or your customers and you ask that one question, “On a scale of one to ten, how enthusiastically do you recommend this as a place to work? How enthusiastically would you recommend our service?” You take the percentage of people who gave you nines and tens as your promoters and you subtract the percentage of people who gave you a one, three, six as your detractors. You end up with a result of somewhere between negative 100% and positive 100%. 50% is considered to be world-class and you are in the 70%. Why do you think you’re in the high 70%? How does a high employee and promoter score translate to sustainability?
We are actually 84% now. It’s those moments of growth in your company when you’re like, “We’re getting better as we’re growing. These are some good things.” I’m always a skeptic too. I’m always like, “What should we be doing better?” After our Series A, we hired an HR. One of the main things that I’ve seen at similar companies is when you start hitting those major growth stages of adding a lot of people, new processes and policies, it can start weighing down on the business. It becomes a culturally draining, exhausting environment especially in the employees that have been around from the early stages. It becomes a difficult transition from, “I can do whatever I want. I’ve got my company card and no one asks questions,” to, “We have a policy for how reimbursements get made.” Those are difficult transitions.
We set out to build out our culture committee within the organization that was not a top-down, but a bottom-up strategy around understanding what our values are. This is an ongoing theme that we are always talking about, “How do we continue to focus on our culture?” In early-stage companies, culture is typically set by the relationships built between those founding members of the company and those earlier employees. You get to these injection points in your company where you have to become more focused and intentional with culture growth. It no longer is anyone can come to the CEO and ask questions and get direction. There is middle management and processes for how those things need to happen. Communication and constant collaboration are key important things. From that, we instilled the culture committee. That’s a rotating group of people throughout the company that want to be involved in our company culture, that care about it. We instilled in them to define our cultural values that they’ve seen us, that organically grew across the business. From there, those key things are transparency, harmony, influence and integrity.
Those are key things that we talk about on a regular basis. We call each other out, “You’re not being transparent. That’s not what we do things. We do things with top integrity.” We call each other out on those things that we’re not doing that are fitting with our culture. We try to be transparent with our financials, with the company strategy. We meet on a monthly basis with the entire company to talk about those things and provide those feedback mechanisms. Those are some of the strategies that we’ve used to have seen an increase in our Net Promoter Score. This is even though we’ve gone through rattling changes of pricing models, new leadership, new structures, new ways of thinking about how we develop all our products and service our customers.
Through this high growth and through the two rounds of funding, how did you keep the company focused? How did you as a company and people say no and learn to say no?
Saying no is difficult, but it’s also an easy thing to do. If you are strategic, you know how to do it. Being a small company, we use Slack as our communication channel. If you are an organization that has not thought about how to get out of email for internal communication, you need to use Slack. That’s hands down what you need to be able to do. Within that, we are constantly communicating with each other throughout those stages of growth. We’ve been through a big office move, which was a stressful project that my office and my office manager, Gabby, were leading. The one thing that we were constantly doing is providing updates, consistently and clearly to the entire company about the progress that we were going through these major changes. That’s a key element to not having decisions ever up here to be done in the dark, which can be the tendency sometimes when there are a lot of things going on. You might say, “We don’t want to flood people with communication.” I argue that you should flood people with communication but done in an organized clear way. Make sure that people feel connected to the strategies of the company. Those big moments of change within the company, to those key hires that will help accelerate growth in your organization.
You are getting the balance right figured out. One final question, if you were to give the 21-year-old Dana some advice when you were starting your career, stuff that you know for sure to be true, what would you tell yourself back then, now?
Back when I was 21, I was still on the mindset that I was going to be an architect building and designing buildings. I had no idea that there were opportunities to lead a business and to be in the software space. I probably would tell myself to continue to embrace opportunities as they come your way and not be fearful of them but embrace them. Each step of the way, you will learn amazing things that will help to make you stronger and better. If you ever feel comfortable, you need to do something. You need to continuously challenge yourself to learn new things, to be constantly learning. I was fearful of change in those early stages of my career. I wish I ran with open arms to those changes and those fears that prevented me in those early steps of the career to thrive. Do not let fear control you.
I love that you approached Matt in the early days and say, “I want in. I’ll do what needs to be done.” You saw the opportunity and you trusted your gut that something felt right about it. It was like, “Let me in the door.”
As I say to a lot of people, “Be bold. Ask for what you want. Reach out to the people you want to work with and connect with. You’ll be surprised where those paths will take you.”
Dana Arnold, the Chief Operating Officer for Measurabl, thank you for sharing with us.
Thank you, Cameron. It’s been a pleasure.
I appreciate it.
About Dana Arnold
Dana oversees business operations including human resources, accounting, finance, legal, strategic partnerships, customer success, and international operations at Measurabl. Dana has led the company through 2 early-stage venture funding rounds resulting in over $20 million in cash to the business and implemented processes to support customer growth by over 270% in monthly recurring revenue. Maintained employee net promoter scores in the high 70’s (industry excellent benchmark at 50) through tremendous growth stages of the business.
Dana is very passionate about the solution that Measurabl is bringing to the market, scaling businesses, building a strong company culture, and supporting innovation around protecting the environment.
Prior to Measurabl, Dana ran two departments – a 20-person Data Services team and a 4-person Customer Success team – at Goby, a tech-enabled real estate consultancy. While at Goby, she was instrumental in building strategic partner relationships, directing business strategies, and improving data analysis and tools. Prior to Goby, she supported Aramark, a food, facilities, and uniform services organization, as the Environmental Sustainability Manager in Corporate Responsibility where she worked across departments to increase operational efficiency and sustainability initiatives, as well as corporate reporting initiatives, including CDP reporting. Dana studied Architecture at the University of Michigan.