Hear the one about the unemployed middle-aged guy who tripped and fell into the new economy?
An exclusive sneak peek at the book “Disrupted.”
If you made a movie about a laid-off, sad-sack, fiftysomething guy who is given one big chance to start his career over, the opening scene might begin like this: a Monday morning in April, sunny and cool, with a brisk wind blowing off the Charles River in Cambridge, Mass. The man—gray hair, unstylishly cut; horn-rimmed glasses; button-down shirt—pulls his Subaru Outback into a parking garage and, palms a little sweaty, grabs his sensible laptop backpack and heads to the front door of a gleaming, renovated historic redbrick building. It is April 15, 2013, and that man is me. I’m heading for my first day of work at HubSpot, the first job I’ve ever had that wasn’t in a newsroom.
HubSpot’s offices occupy several floors of a 19th-century furniture factory that has been transformed into the cliché of what the home of a tech startup should look like: exposed beams, frosted glass, a big atrium, modern art hanging in the lobby. Riding the elevator to the third floor, I feel both nerves and adrenaline. Part of me still can’t believe that I’ve pulled this off. Nine months ago I was unceremoniously dumped from my job at Newsweek magazine in New York. I was terrified that I might never work again. Now I’m about to become a marketing guy at one of the hottest tech startups on the East Coast—a software company that has created an “inbound marketing” platform, which helps companies pull customers in (through blogs, social publishing, and other content), in contrast to outbound marketing (traditional advertising). There is one slight problem: I know nothing about marketing. This didn’t seem like such a big deal when I was going through the interviews and talking these people into hiring me. Now I’m not so sure.
I reassure myself by remembering that HubSpot seems pretty excited about having me come aboard. Cranium (my endearing name for the fellow), the chief marketing officer, or CMO, wrote an article on the HubSpot blog announcing that he had hired me. Tech blogs wrote up the story of the 52-year-old Newsweek journalist leaving the media business to go work for a software company.
A guy named Zack meets me and tells me he’s sorry Cranium isn’t here today, but he wants to give me a tour around the offices. Zack is in his twenties. He has a friendly smile and gelled hair. He reminds me of the interns at Newsweek, recent college graduates who did background research for the writers. I figure he must be someone’s assistant.
The offices bear a striking resemblance to the Montessori preschool that my kids attended: lots of bright basic colors, plenty of toys, and a nap room with a hammock and soothing palm tree murals on the wall. The office-as-playground trend was made famous by Google and has spread like an infection across the tech industry. Work can’t just be work; work has to be fun. HubSpot is divided into “neighborhoods,” each named after a section of Boston: North End, South End, Charlestown. One neighborhood has a set of musical instruments, in case people want to have an impromptu jam session, which Zack says never happens. Every neighborhood has little kitchens, with automatic espresso machines, and lounge areas with couches and chalkboard walls where people have written things like “HubSpot = cool” alongside inspirational messages like “There is a reason we have two ears and one mouth. So that we listen twice as much as we speak.”
On the ground floor an enormous conference room doubles as a game room, with the requisite foosball table, Ping-Pong table, indoor shuffleboard, and videogames. The cafeteria next door boasts industrial refrigerators stocked with cases of beer, cabinets with bagels and cereal, and, on one wall, a set of glass dispensers that hold an assortment of nuts and candy. It’s called the “candy wall,” and Zack explains that HubSpotters are especially proud of it. The wall is one of the first things they show off to visitors. It’s a young place, with lots of energy. Teams go on outings to play trampoline dodgeball and race go-karts and play laser tag.
Dogs roam HubSpot’s hallways, because like the kindergarten decor, dogs have become de rigueur for tech startups. At noon, Zack tells me, a group of bros meets in the lobby on the second floor to do push-ups together. Upstairs there is a place where you can drop off your dry cleaning. Sometimes they bring in massage therapists. On the second floor there are shower rooms, which are intended for bike commuters and people who jog at lunchtime, but also have been used as sex cabins when the Friday happy hour gets out of hand. Later I will learn (from Penny, the receptionist, who is a fantastic source of gossip) that at one point things got so out of hand that management had to send out a memo. “It’s the people from sales,” Penny tells me. “They’re disgusting.”
Later I also will hear a story about janitors coming in one Saturday morning to find the following things in the first-floor men’s room: a bunch of half-empty beers, a huge pool of vomit, and a pair of thong panties. The janitors were not happy. They get even more distressed when, one morning, a twenty-something guy from the HubSpot marketing department arrives wasted and, for reasons unknown, sets a janitor’s cart on fire.
Everyone works in vast, open spaces, crammed next to one another like seamstresses in Bangladeshi shirt factories, only instead of being hunched over sewing machines people are hunched over laptops. Nerf-gun battles rage, with people firing weapons from behind giant flat-panel monitors, ducking and rolling under desks. People hold standing meetings and even walking meetings, meaning the whole group goes for a walk and the meeting takes place while you’re walking.
Nobody has an office, not even the CEO. There is a rule about this. Every three months, everyone switches seats, in a corporate version of musical chairs. HubSpot calls this a “seating hack” and says the point is to remind everyone that change is constant. If you want privacy, you need to book one of the meeting rooms that are strung around the edges of the working spaces. Some meeting rooms are named after Red Sox players, others after “famous marketers”—I take a moment to let that sink in. Some have beanbag chairs instead of actual furniture, and in those rooms people sprawl out, with laptops propped on their knees.
Every new HubSpot employee has to go through training to learn how to use the software. That’s a good idea, and it also keeps me from having to worry about what I’m supposed to be doing here, or why Cranium, who hired me, still has never come by to say hello or talk about what he wants me to work on.
Training takes place in a tiny room, where for two weeks I sit shoulder to shoulder with 20 other new recruits, listening to pep talks that start to sound like the brainwashing you get when you join a cult. It’s everything I ever imagined might take place inside a tech company, only even better.
Our head trainer is Dave, a wiry, energetic guy in his forties with a shaved head and a gray goatee. On the first day we all go around and introduce ourselves, and tell everyone about something that makes us special. Dave’s thing is that he plays in a heavy-metal cover band on weekends.
Dave is part teacher and part preacher. Every two weeks he gets a batch of new recruits, and he goes through the same spiel, showing the same slides, telling the same jokes. He’s good at it. He loves HubSpot, he tells us, unabashedly. He’s had lots of jobs, and this is by far the best place he’s ever worked. This company has changed his life. He hopes it will change ours as well.
“We’re not just selling a product here,” Dave tells us. “HubSpot is leading a revolution. A movement. HubSpot is changing the world. This software doesn’t just help companies sell products. This product changes people’s lives. We are changing people’s lives.”
He tells a story about a guy named Brandon, a pool installer in Virginia. His business was struggling. He could barely get by. But then he started using HubSpot software, and his business took off. Soon his company was installing pools all around the country. He was rich! Eventually he was doing so well that he hired someone else to run his pool company so that he could become a motivational speaker. He travels the world spreading the gospel of inbound marketing, transforming the lives of thousands of other people.
“This guy has become a superstar,” Dave says. “He’s a rock star. And it all started with HubSpot. That’s what we’re doing here. That’s what you are part of.”
The truth is that we’re selling software that lets companies, most of them small businesses like pool installers and flower shops, sell more stuff. The world of online marketing, where HubSpot operates, though, has a reputation for being kind of grubby. Our customers include people who make a living bombarding people with email offers, or gaming Google’s (GOOGL) search algorithm, or figuring out which kind of misleading subject line is most likely to trick someone into opening a message. Online marketing is not quite as sleazy as Internet porn, but it’s not much better either.
Nevertheless, Dave is laying it on thick, and the new recruits are nodding their heads and seem to be eating it up. Most of them are right out of college, clean-cut and well scrubbed. The guy next to me has a buzz cut and just graduated from some college in New Hampshire. He tells me that he lives with his parents and commutes an hour to get here, but he’s thinking about moving closer to Boston and getting his own place.
HubSpot doesn’t just sell this software—it also teaches people how to use it and in general how to be more effective at selling stuff online. At its annual customer conference, Inbound, thousands of online marketers flock to Boston to learn new tricks. One involves using a misleading subject line in an email—something like, “fwd: your holiday plans”—to dupe people into opening the message. “Boosting your open rate,” they call it. At the conference HubSpot also shows off new features and products, like one that puts a tracking cookie on the computer of everyone who visits your website and keeps track of every page the person visits. The software can even send you an alert when someone comes back to your website for a second visit—so you can call that person immediately and say, “Hey, I see you’re on our website! Is there something I can help you with?”
That’s the business we’re in: Buy our software, sell more stuff. There’s nothing wrong with that, but that’s not exactly how HubSpot bills itself or describes what it does. In training we’re taught that the billions of emails that we blast into the world do not constitute email spam. Instead, those emails are what we call “lovable marketing content.” That is really what our trainers call it. The convoluted logic behind this is that “spam” means unsolicited email, and we send email only to people who have handed over their contact information by filling out a form and giving us their permission to be contacted. Our emails might be unwanted, but they’re not, strictly speaking, unsolicited, and therefore they are not spam. And even though we and our customers send out literally billions of email messages, we’re not trying to annoy people—in fact we are trying to help them. Sending one message after another, each time with a different subject line, is how we discover what someone wants. We’re learning about them. We’re listening to them.
Thus, what we’re creating is not spam. In fact, the official line is that HubSpot hates spam and wants to stamp out spam. We want to protect people from spam. Spam is what the bad guys send, but we are the good guys. Our spam is not spam. In fact it is the opposite of spam. It’s antispam. It’s a shield against spam—a spam condom. HubSpot has even created a promotional campaign, with T-shirts that say make love not spam.
Arriving here feels like landing on some remote island where a bunch of people have been living for years, in isolation, making up their own rules and rituals and religion and language—even, to some extent, inventing their own reality. This happens at all organizations, but for some reason tech startups seem to be especially prone to groupthink. Every tech startup seems to be like this. Believing that your company is not just about making money, that there is a meaning and a purpose to what you do, that your company has a mission, and that you want to be part of that mission—that is a big prerequisite for working at one of these places.
At HubSpot, employees abide by precepts outlined in the company’s culture code, a document that codifies HubSpot’s unusual language and sets forth a set of shared values and beliefs. The culture code is a manifesto of sorts, a 128-slide PowerPoint deck titled “The HubSpot Culture Code: Creating a Company We Love.”
The code’s creator is HubSpot’s co-founder. Inside the company he is always referred to simply by his first name, Dharmesh, and some people seem to view him as a kind of spiritual leader. Dharmesh claims it took him 100 hours to make the slides. He sent me a link to the slide deck a few days after I interviewed with him and his co-founder, Brian Halligan, I suppose as an inducement to join the company. He said it was a slide deck that “describes HubSpot’s culture.”
The code depicts a kind of corporate utopia where the needs of the individual become secondary to the needs of the group—“team > individual,” one slide says—and where people don’t worry about work-life balance because their work is their life.
The culture code asks, “What does it mean to be HubSpotty?” and then defines the meaning of that term, explaining a concept that Dharmesh called HEART, an acronym that stands for humble, effective, adaptable, remarkable, and transparent. These are the traits that HubSpotters must possess in order to be successful. The ultimate HubSpotter is someone who can “make magic” while embodying all five traits of HEART.
Much of the code is “aspirational,” as Dharmesh concedes, meaning that some of these values are ones that HubSpot doesn’t actually put into practice yet but hopes to someday. One of HubSpot’s values involves being transparent, and not just transparent but “radically and remarkably transparent.”
The culture code has been an enormous PR coup for the company and a model that a lot of other startups have emulated. When Dharmesh posted his slides online they received more than 1 million views. This inspired him so much that now he is setting out to write a book about corporate culture.
Dharmesh’s culture code incorporates elements of HubSpeak. For example, it instructs that when someone quits or gets fired, the event will be referred to as “graduation.” In my first month at HubSpot I’ve witnessed several graduations, just in the marketing department. We’ll get an email from Cranium saying, “Team, just letting you know that Derek has graduated from HubSpot, and we’re excited to see how he uses his superpowers in his next big adventure!” Only then do you notice that Derek is gone, that his desk has been cleared out. Somehow Derek’s boss will have arranged his disappearance without anyone knowing about it. People just go up in smoke, like Spinal Tap drummers.
Nobody ever talks about the people who graduate, and nobody ever mentions how weird it is to call it “graduation.” For that matter I never hear anyone laugh about HEART or make jokes about the culture code. Everyone acts as if all of these things are perfectly normal.
HubSpotters talk about being “superstars with superpowers” whose mission is to “inspire people” and “be leaders.” They talk about engaging in “delightion,” which is a made-up word, invented by Dharmesh, that means delighting our customers.
The ideal HubSpotter is someone who exhibits a quality known as GSD, which stands for “get shit done.” This is used as an adjective, as in “Courtney is always in super-GSD mode.” The people who lead customer training seminars are called inbound marketing professors and belong to the faculty at HubSpot Academy. Our software is magical, such that when people use it—wait for it—one plus one equals three. Halligan and Dharmesh first introduced this alchemical concept at HubSpot’s annual customer conference, with a huge slide behind them that said “1 + 1 = 3.” Since then it has become an actual slogan at the company. People use the concept of one plus one equals three as a prism through which to evaluate new ideas. One day Spinner, the woman who runs PR, tells me, “I like that idea, but I’m not sure that it’s one-plus-one-equals-three enough.”
It turns out I’ve been naive. I’ve spent 25 years writing about technology companies, and I thought I understood this industry. But at HubSpot I’m discovering that a lot of what I believed was wrong.
I thought, for example, that tech companies began with great inventions—an amazing gadget, a brilliant piece of software. At Apple, Steve Jobs and Steve Wozniak built a personal computer; at Microsoft (MSFT), Bill Gates and Paul Allen developed programming languages and then an operating system; Sergey Brin and Larry Page created the Google search engine. Engineering came first, and sales came later. That’s how I thought things worked.
But HubSpot did the opposite. HubSpot’s first hires included a head of sales and a head of marketing. Halligan and Dharmesh filled these positions even though they had no product to sell and didn’t even know what product they were going to make. HubSpot started out as a sales operation in search of a product.
Another thing I’m learning in my new job is that while people still refer to this business as the “tech industry,” in truth it is no longer really about technology at all. “You don’t get rewarded for creating great technology, not anymore,” says a friend of mine who has worked in tech since the 1980s, a former investment banker who now advises startups. “It’s all about the business model. The market pays you to have a company that scales quickly. It’s all about getting big fast. Don’t be profitable, just get big.”
That’s what HubSpot is doing. That’s why venture capitalists have sunk so much money into HubSpot, and why they believe HubSpot will have a successful IPO. That’s also why HubSpot hires so many young people. That’s what investors want to see: a bunch of young people, having a blast, talking about changing the world. It sells.
Another reason to hire young people is that they’re cheap. HubSpot runs at a loss, but it is labor-intensive. How can you get hundreds of people to work in sales and marketing for the lowest possible wages? One way is to hire people who are right out of college and make work seem fun. You give them free beer and foosball tables. You decorate the place like a cross between a kindergarten and a frat house. You throw parties. Do that, and you can find an endless supply of bros who will toil away in the spider monkey room for $35,000 a year.
On top of the fun stuff you create a mythology that attempts to make the work seem meaningful. Supposedly millennials don’t care so much about money, but they’re very motivated by a sense of mission. So, you give them a mission. You tell your employees how special they are and how lucky they are to be here. You tell them that it’s harder to get a job here than to get into Harvard and that because of their superpowers they have been selected to work on a very important mission to change the world. You make a team logo. You give everyone a hat and a T-shirt. You make up a culture code and talk about creating a company that everyone can love. You dangle the prospect that some might get rich.
One Thursday in late 2014, I stop by my boss’s desk and tell him I’ve been offered a new job. I won’t start until January, but I am giving him six weeks’ notice. He asks me to reconsider. I tell him I appreciate the offer, but I’ve made up my mind.
Soon, I know, word will get out that I am “graduating.” It’s a strange but somehow satisfying feeling to know that, roughly three decades after my college career has ended, I am set to go through that ritualized departure once more. I am going to be like so many other HubSpot graduates I’ve seen come and go over the past several months—“using my superpowers in the next big adventure!”
But the email that Cranium sends to the HubSpot faithful that evening doesn’t mention anything about any of that. It just implies that I’ve been fired—and that Friday will be my last day.
HubSpot filed for an IPO on Aug. 25, 2014, and launched under the symbol HUBS on the New York Stock Exchange that October, with a market valuation of $880 million. Dan Lyons left HubSpot in December 2014. He never signed the nondisparagement and nondisclosure paperwork the company gave him. (HubSpot says it won’t comment on employee agreements.) On July 29, 2015, HubSpot issued a press release saying its CMO, Mike Volpe—the man called “Cranium” in Lyons’s book—had been terminated because he “violated the Company’s Code of Business Conduct and Ethics” in his “attempts to procure” a copy of a book involving HubSpot, presumably the book excerpted above, a fact that HubSpot confirmed with Fortune. We attempted by email and telephone to contact Mr. Volpe for comment; we were unable to reach him. When asked for comment on Lyons’s experience at the company, HubSpot CEO and co-founder Brian Halligan said the following: “We believe that to build a great company today, it’s essential to have a point of view on how the world has changed, what you are doing about it and why it matters. We started HubSpot a decade ago believing that the way people buy and sell had fundamentally changed. We saw an opportunity to help organizations adjust to that shift, and today we’re proud to have more than 18,000 customers who have chosen to partner with us to transform how they market and sell.”
A version of this article appears in the April 1, 2016 issue of Fortune.