How the former Yahoo COO and Silicon Valley veteran digitally transformed Chegg into an $11 billion powerhouse.
My ongoing series in partnership with Entrepreneur, If I Knew Then: Leadership Lessons, sets the stage for a unique platform to host virtual fireside chats with high-profile CEOs of major brands, from Indeed and Nextdoor, to GoDaddy and DocuSign. These insightful sessions spotlight the minds of successful leaders as they share advice and lessons for both current and future entrepreneurs.
For our latest episode, I wanted to talk to one of Silicon Valley’s most influential CEOs about how his company instantly scaled up to meet the exponential demand in business due to the pandemic. With universities closed and students forced to quickly adapt to online learning, I invited Chegg president and CEO Dan Rosensweig to share his knowledge. Since he took the role in 2010, the long-established textbook rental model has transformed into a leading direct-to-student online learning platform, resulting in 64 percent year-over-year revenue growth and 69 percent subscriber growth. Chegg is now worth $11 billion, with 4 million subscribers in 190 countries and a total of 252 million content views of Chegg Study.
An advocate for students and coiner of the term “learn to earn,” Rosensweig shares that Chegg’s goal is to improve the return on investment in education by helping students learn more in less time, and at a lower cost. His mission to help improve access for all to high-quality education where students learn and gain employability for the future is no small feat. Given what we are learning pre- and post-pandemic, he thinks we have to ask ourselves about the future of higher education. “If I could do anything, it’s to get a dialogue going about the role of education in the United States,” says Rosensweig. “We are having the wrong debate over if it should be free or not. Instead, the debate should be, what should education be doing? It would not be expensive if people could get a return on it, but they’re not going to get a return if it is not teaching them something that employers are willing to pay for. And that is the part of what is missing.”
More than 10 years ago, Rosensweig had a vision for the future of textbook rentals, and that vision has come to fruition with Chegg, which offers a host of high-quality, low-cost, personalized and on-demand educational resources. Prior to Chegg, he was CEO of Guitar Hero, COO of Yahoo and CEO of ZDNet. He also serves as a Colgate University Emeritus Trustee, sits on the board of directors for both Adobe Systems and Rent-the-Runway and serves as a senior advisor for TPG Growth Ventures and an advisor to both Kleiner Perkins and Bond Capital. With 30 years of Silicon Valley experience — coupled with a diverse background — this powerhouse and Renaissance man has gifted us with these 13 incredible lessons:
1. Your ability to survive is born out of your mission
Shut out the noise of the naysayers and focus on solving the problem. Rosensweig says that Chegg has never strayed from its mission. “Our ability to survive an IPO or Amazon trying to put us out of business is because of the awareness of our mission; the students have a bigger problem than we do,” he says.
2. In your worst moment, commit to your future
It is never too late in the game to try something new. Chegg’s playbook for success was modeled after Adobe, a packaged goods software company that built the best tools for creatives that found many of its clients were going out of business. “This is where most companies get afraid and get stuck," Rosensweig says. “It’s a decline you can’t get out of.” However, Adobe decided to utilize cloud technology to build successful subscription model. This turnaround inspired Rosensweig to always “accelerate the decline of your current business with the hope and belief that the new business will one day be bigger,” and he did just that.
3. Bet on the inevitable
Rosensweig elaborates: “How did Chegg bet on the inevitable? We knew that more students were going to need more help with more things. They were going to have less support from their families, and more of them were going to be from immigrant families. The educational experience needed to be on-demand when they could do it.” By betting on the inevitable, Chegg was able to churn out a high-quality, comprehensive, user-friendly on-demand modern learning platform that is not only meeting the growing needs of students, it’s affordable.
4. If you are a CEO, whatever decision you make is the right one
You will never know the road not taken. Rosensweig recalls a time when his Chegg CFO said, “I’m going to tell Wall Street that three years from now we are going to grow 30 percent with 25 percent margins at this percentage of free cash flow. It’s our job between now and then to do that.” Rosensweig reflects on this time, adding “Once we had a north star, we could do it. It was either die or go all-in, and we went all-in.”
5. Like the skin you are living in and optimize the strengths you have
Rosensweig believes that we are in a generation that is looking for authenticity. People are not looking for weaknesses, but vulnerability. They want to know, “If I have f-cked up in my life, is my life over?” He compares his authenticity to a football coach who inspires his team by saying there will always be another play. How Rosensweig has lived his life and his style of leadership are a reminder that there will always be another play. According to him, there is always going to be someone smarter, richer, taller, but no one else is the authentic you.
6. Be courageous enough to say yes to everything
Be open to saying yes, even to a job you might think you’re not ready for, because there is no perfect person for any job. Embrace an opportunity, be present and don’t doubt it. It’s hard enough to be successful when all of the circumstances are perfect, but they rarely are. Rosensweig believes life is full of serendipity and that very few people can map out their future and get it right because there are too many unknowns: “Find environments where what you do well is the necessary thing. Commit and then kick ass.”
7. Strive to leave a place better than when you got there
When asked what his superpower is, Rosensweig offers a quote from Bill Campbell, who said, “Once you know you have been screwed, quit or shut the f*ck up and fix it.” Inspired by this notion, Rosensweig shares that his strength lies in leaving a company better than when he got there: “Complaining about a problem doesn't solve a thing, and people depend on the problem being fixed. You can choose to leave or fix it.” He could have complained about textbooks not being the model of the future, but instead he chose to work with his team. and as a result, Chegg became a much more valuable, important and influential company.
8. Don’t let the outcome come to you, influence the outcome
Make the bet, commit to it and whatever the outcome is the outcome. Rosensweig’s authenticity reaches a grand scale when he shares his fears: “In the past, I have feared many things like imposter syndrome and fear in general: What if I fail, what if I embarrass my family and myself? It’s hard to be successful if you don’t have confidence in yourself. Trust your instincts and find a way to manufacture confidence in yourself.”
9. There is no one way to do anything, so trust the people around you
If you hire smart people who are the best at what they do, trust them to do it with the goal that they are trying to achieve. Describe success so they have a picture of what it looks like, but don’t prescribe how to do it. Rosensweig advises: “You don’t have to be the smartest person in the room; you just need to know who the smartest person in the room is that is knowledgeable about the topic you need to make a decision about.”
10. Ask people how they want to be managed
If you want to know how to get the best out of potential team members, ask them in the interview process, “How do you want to be managed? What is important to you?” Rosensweig learned this invaluable lesson later in life and offers this sports analogy: “The coaches who do best are the ones who embrace how to get the best out of their athletes.”
11. Managers and executives are like flight attendants
If you have ever been on a flight where there is turbulence, you look to the flight attendants first. If you see that they are smiling or laughing, you calm down. However, if they look scared and are diving for their seats, you go into panic mode. Remember that managers and executive leaders are similar to flight attendants in that they are considered the first line of defense, the company’s brand ambassadors and the people employees and shareholders look to for reassurance, safety and security in times of chaos and confusion. So, if you have to manufacture confidence as a leader to keep employees calm, do it.
12. A CEO’s job is to be the mayor of a small village
Employees should not have to worry if the company is going to go out of business or if there are other concerns and problems. Let them focus on the job at hand, not be preoccupied with all of the other things that people can worry about. Rosensweig shares another point that his wife made that solidified his style of leadership: “Whether you like it or not, when the boss walks into a room, people look at the boss. If you look angry, they are going to be nervous. If you look worried, they will be worried. If you look happy, engaged and involved, then they will be happy, engaged and involved.” Take their worry and stress off of the table.
13. Fast feedback can help mitigate stress from your team
Fast feedback relies on regular dialogue with your team, but on a more consistent basis. Rather than relying on an annual review meeting, where you dredge up things from nine months ago, a great alternative is to tell people in-the-moment the good things they are doing and the things that you have questions on so they get used to receiving consistent feedback on a daily or weekly basis. This takes the stress out of employees worrying about their job review so that they can put their energy into doing a great job.
Dan Rosensweig is on a mission to help improve access for all to high-quality education where students learn and gain employability for the future. The things that stood out to me from the moment we met was just how unbelievably vulnerable and transparent he is. It’s rare to have somebody with as much success as he has had to be open right away with a whole group of folks about what didn’t work or what failed. Often people would rather reinforce only the good times, but it’s always the tough challenges we all have to go through that get us farther along in life.
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