Padmasree Warrior is the CEO of NIO.

Anu Hariharan is a Partner at YC Continuity.



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Transcript

Anu Hariharan – Next you’re going to meet Padmasree Warrior. Forbes calls her, “The queen of electric car business.” Padmasree is the CEO of NIO and also the Chief Development Officer. NIO designs smart autonomous vehicles, and prior to this, Padmasree held C level positions at Cisco as well as Motorola, and is on the board of Microsoft and Spotify. Thank you for being here.

Padmasree Warrior – Thank you.

Anu Hariharan – So I think the first question that a lot of them really have is you’ve spent more than two decades in really successful skilled companies, why NIO?

Padmasree Warrior – So, yeah, that’s right. For over two decades I worked… I started my career actually as an engineer. I’m an engineer. I started in the semiconductor industry as a line engineer working in fabs and eventually worked my way up to become the Chief Technology Officer for Motorola. Semiconductor business then eventually the cool company, and then moved to Cisco in 2008. And I was a CTO first and then CSO, and then eventually CTO and CSO. And I left Cisco about a year and a half ago, I left in September of 2015. When I left, I didn’t know what I was going to do, but I knew that what I didn’t want to do. I knew I didn’t want to do the same job twice. In other words, I didn’t want to go into another large tech company in a C level position. Because I felt like I have done that in two very large companies.

This time I wanted to go somewhere where I could impact a whole industry and change the whole industry. So I was kind of thinking I wanted to start my own company either in the education vertical or in the transportation vertical, both I felt were industries that have by and large been stagnant and have always had technology on the periphery, never central to the industry. And then I joined NIO, we work on building autonomous electric vehicles. But the focus is really on how we would all spend our time when we’re not driving anymore. So the focus is really about how do we improve people’s…how do we give people time back from driving and freeing you from the chores of driving. So we focus a lot on user experience. So it’s a fascinating time to be really in this industry and rethink everything.

Anu Hariharan – I remember one of the things we had discussed before, you said that even though the car seems like something that men purchase, you said actually the consumer buying decision in many cases is done by women. So, how do you bring that in the product design or as you think about the evolution of the car even under NIO? Like, how do you think about building a team around that?

Padmasree Warrior – When I started in this role I didn’t know anything about building cars. Obviously, I was a consumer and I’m not really a car guy, but I think of it as a consumer product. So we spent about six months doing a lot of user research, what do people buy vehicles for, what do they look for? And it’s interesting; actually, in the United States more than 50% of the buyers for vehicles are women. And many of the women that we interviewed said that even when they go to a dealership today and they go with their spouse or boyfriend, and that person says, “This, my wife or my partner is actually buying the car.” In the dealership the sale is actually made to the man and they ignore the woman, they talk to the guys and they tell them about all the features that they think the men like. And so that was one interesting find, and the second thing we found was women always struggle because they’re sold minivans and labeled “soccer moms,” and ignore the professional side of what a woman want. And many of us work and have families. And so many people have told us, “I don’t want to drive a vehicle that kind of pigeon holes me into soccer mom image. I want something that is also beautiful in the vehicle and has got space inside for my children,” or for my bags or whatever. So their needs were not being met in the product category and this is the largest buying power in the country today for vehicles.

So it was sort of like, interesting, to think how one of the most aspirational consumer product completely ignores more than half the population and more than half the demographic that’s actually consuming that product. So we are taking a lot of these factors into our design criteria as we look at it. Obviously, you never build a product for a particular gender, but it’s more for the utility and what people are looking for. So I think that was a big eye-opener for me. And it’s very true and I think you have to either choose between a beautiful car but it’s very compact and has no space, or something that’s giant and looks ugly. There isn’t anything that’s in between.

Anu Hariharan – Where do you think self-driving is headed? And what is your vision for NIO?

Padmasree Warrior – We are targeting to have what is known in the industry as a Level 4 self-driving car by 2020, meaning that the vehicle will be fully capable of driving itself, but we are building our car with the steering and pedals, and so to allow you to drive if you want to drive it. And we think that actually allows us to overcome any regulation barriers that might get in the way because there is a human in the loop when you are driving. I think fully autonomous Level 5 vehicles are probably further away, maybe 2025, maybe even 2030 expectations, maybe. I think the technology will be there.

I think to me there are three axis that have to all come together, one is the technology has to be mature and developed and be reliable and safe, the second is the cost of the technology has to come down and it will come down over time, LIDARs and radars and sensors have to come down, and the compute platform is very powerful in this vehicle. And the third is actually human behavior itself, right? Like my generation a lot of people we grew up where we were taught a particular way to drive and you have to take a driver’s license test, and you past the test, and you hold the wheel, and you’re taught how to hold the wheel. There’ll be a generation coming now, right, who will bypass that. They don’t need to drive. And so, there will be a transition period just as we went in the mobile internet space. And so, iPhone is now celebrating its 10th year, right?

Anu Hariharan – Celebrating, yes.

Padmasree Warrior – So before iPhone, where I worked at Motorola, phones were very different and we didn’t expect something like a phone to look like a smartphone back then. Similarly, I think cars in the future will be very, very different. So all these three things I think will intersect and the future will be very exciting for all of us. Imagine, I work in San Jose, my company is there and now is coming up here. Imagine, if I could just sit back and do whatever I wanted to do, take a nap on my way back instead of worrying about traffic and driving.

Anu Hariharan – I’ve seen the video of your product which is very exciting. I can’t wait for the car yup, yeah. Now, you’ve been at successful companies, but you’ve also built them at scale. And you’ve talked a lot about how great teams are what makes a company great. So what tactical advice do you have for founders here in terms of their first 10 or those first 50 hires? Because you’ve stressed a lot about how that is really important and how you build a company culture that you also treasure.

Padmasree Warrior – I think when you’re a founder of a company there are… I think it’s much harder, by the way, to start a company than to be in a big company and lead a big company in the following ways. When I started at NIO, I was employee number 16, there were 15 people that were kind of already there. But I think I only had like one engineering person and we had two trailers and a parking lot inside of there. You basically are starting from nothing and a vision. And I think, to me tactically the first 10 hires, 20 hires, 50 hires, 100 hires are very, very important. In my company I personally interviewed the first 150 people that we hired and we made offers to, because the first 100 people hire the next 1,000 people. And if you wanna scale the company, right, each of them will hire 10 people and so your bar has to continue to remain very, very high. So my advice is as a founder really pay attention to the people that you’re bringing in. I think the previous speaker talked about it. I loved the way she said it, it’s better to have a hole in the organization than an asshole. So I think it’s like very, very true. I think you really have to be very selective and look for the right kind of talent, but also the right kind of a fit.

And the second thing that I watch out for and this I realized as we were scaling. Now, we’re about 350 people in the company. One of the other things that happens is as you scale the organization you go from like 100 people to 300 people, at that stage you’re not hiring anymore, your leaders are hiring. And the tendency would be for them to bring people they know, right?

Anu Hariharan – Yeah.

Padmasree Warrior – And so you create these islands of microculture which you don’t wanna have. So in my company we have a rule that every hire has to have a diverse panel that hires the people. So diverse in terms of the gender, it can be an all-male panel or an all-female panel that interviews, does the interviewing. But also people that are from the hiring group, but also people from outside the group that can ask people different questions. So obviously you asked, in our case we look for a lot of specific technical skills, you test them for those technical skills, but people from finance or corp level will interview them to ask them general questions. So we look for technical depth, behavioral and leadership skills.

And so you ask them things like, in your life what’s the toughest thing you faced and how did you overcome that? It may not really have direct relevance to the role because one of the things we believe is the person’s true character is tested when they’re faced with a very traumatic situation. So, how did you overcome that? So we ask things like that and then we make decisions. So that’s the second very tactical advice that I would give because we actually learned it by the hard way. We were doing it and we found we were creating microcultures where people were hiring from the place they came from. And so, soon we had like this group, that group, and these little islands which all stuck together.

And then the other thing I would say is culture is extremely important and it starts from the very beginning. So in my company one Wednesday a month…and we pick Wednesday because it happens to be the middle of the week, we take time out 4:00 to 6:00 in the afternoon. We call it “team time” and we go to our cafeteria, the whole company comes and we do some fun activity. And it’s not just to have fun, but the intent behind that is to institutionalize the fact that it’s okay to take a break. We don’t want people to burn out, everybody works hard. We have to take care of ourselves when we do this and we do this as a whole company. We all take a break together and we’re under very tight pressure, right now we are the shipping the car, it’s going into production. So people, teams are under a lot of pressure. So we still do this and we still do two hours. It’s legitimate, take a break. And the second reason we do it is allows people from different functions to come together. So you don’t become siloed in the company. And so, the intent is that, but we obviously don’t do it, we don’t state that, we do some fun activity and team activity.

That’s one simple way you can build something fun in the culture, it’s people look forward to and it actually gets fairly competitive, we have people rotating to host team time. And so everybody comes up with their own team, sometimes it’s a competition, it’s a treasure hunt, it’s kind of something goofy. One day we built toy cars and we raced them to see which car goes…so vehicle engineering team in my company was very competitive and they won, actually the software team won the race, which was interesting. So I think we do things like these that I think it’s very important as you scale the company you’re focusing on the right things.

Anu Hariharan – You also have quite a distributed team, is that right?

Padmasree Warrior – Yes.

Anu Hariharan – So how do you make sure that they’re all sort of aligned with a shared purpose or a shared mission?

Padmasree Warrior – Yeah, this is interesting. Our company also has a very different model. We are what we call a global startup, and if you figured this out I think there will be a case study I was telling on you that will be taught in business school someday. And the thesis is this, you know, we feel like the two biggest markets are China and U.S. for vehicles, and each one is going through a major transformation. In China it’s a big movement from internal combustion to EVs. It’s now the largest EV market in the world, and the U.S. we are rapidly adapting autonomy and self-driving cars. So when we started the company we said, “Okay. How do we create a company structure that can win in both markets?” Today, it’s very difficult to do that. So we started two companies, essentially there’s a China company and a U.S. company and we share very capital intensive things like manufacturing and supply chain, and design studio, the car design studio. It has pluses and minuses, right?

Now, one of the complex things is to manage, you know, the requirements that we develop technology, for the company in China they support us for manufacturing, how do we keep everybody coordinated. So, again, goes back to culture and values. We describe the values for the company, four very simple values, we say it’s vision, it’s action, it’s care, and honesty. And so we go back, and the way that’s interpreted in China is very different than here obviously, but we go back to that. And then we make sure roles are very clear, which team is doing what and that we’re not stepping on each other’s toes. So we’ll see how it works, you know, it’s sort of an experiment in its own way.

Anu Hariharan – I also want to go back and sort of trace your career path because that’s something which is really fascinating. So you did your engineering from IIT Delhi in chemical engineering and then went to Cornell, how did you make the decision from that to go to Motorola?

Padmasree Warrior – I’m a chemical engineer. My academic background is in chemical engineering. My master’s degree was doing materials. When I came to U.S. from India as a graduate student I came on a student visa. My goal that time, I thought I wanted to be a professor, I was gonna do my PhD and go back to India and teach. And then it was quite accidental that I ended up working for Motorola. It’s a very funny story, I actually… I don’t know if you know Cornell is in Upstate New York and I left a snowstorm and came to interview with Motorola back then in Arizona, you know, bright sunshine and I said, “God…” and I was from India back then, I wasn’t used to snow and stuff. I said, “Okay. Whatever job they give me I’m moving here. And I’m gonna take a break from my PhD.” And I thought I’d work for a year and go back and I never did. Because I really found working and creating concrete products was to me actually much more interesting. So as I said, I started as a line engineer and worked my way up to become the Chief Technology Officer.

Anu Hariharan – You stayed there for 23 years?

Padmasree Warrior – I stayed there for 23 years. Back then Motorola was a very diverse company. So I got to do many different jobs. So every two, three years almost I was doing something very different. I started in manufacturing and then went into technology transfer, and then research, and eventually became CTO.

Anu Hariharan – Got it. And then did you come to Silicon Valley for Cisco?

Padmasree Warrior – Right. I moved to Silicon Valley in 2008, I moved to become the CTO for Cisco.

Anu Hariharan – Got it. You’ve been an engineer in the late 1980s, you’ve been in the Valley now for a while, has anything changed being a woman engineer?

Padmasree Warrior – So there are very few women engineers. I’d love to see more women engineers. It’s, I think in the technical areas they’re still…the ratios are very, very…it’s roughly the same. I think when I went to school it was about 14% in engineering and now it’s about the same. So in some ways it hasn’t changed at all, if you just look at the numbers in the last 20 years. It’s still very difficult I think for women in technical field. And I’ve been an engineer pretty much my whole career, I just move to different roles in engineering. I just spoke at Microsoft with their women engineers and I think, roughly the numbers are the same across multiple companies. So if you just look at that you feel like, “Okay. Now, things really change.” The fact that now we are speaking up more is, I think that has changed. I think in the past probably we would have not said all the things we are saying and calling out, and I think that’s great. We should continue to do more of that. I think we shouldn’t let anybody no matter what level they are in any company get away with things that sometimes they think they have a license to get away with, that, I’m very proud of. I think in just the last year we read and we’ve all followed all of the stories that have been coming out. Not stories, the reality actually, right? Which is shocking in some ways and you think like, “Wow.” But in other ways we feel like, we knew this was happening, now we’re acknowledging this is happening and now calling it out and holding people accountable. I think that’s a great step forward. Now we need to say, how do we stop these things from happening in the first place, right?

Anu Hariharan – As a woman engineer you’ve talked about this before, how did you feel you had to behave like a man sometimes or change your style of work?

Padmasree Warrior – Absolutely. When I started I was…I think there were probably very few engineers in factories, in semiconductors factories. I started as a factory engineer. We were actually told to dress a particular way. We couldn’t wear any color, we were told to wear… The story I’m telling, wear grey and try to blend in.

Anu Hariharan – In sneaker shoes.

Padmasree Warrior – Again, I came from India, I grew up with a lot of color. It was very alien for me to be that way, but I forced myself to do it because I thought, like, “Oh, my gosh, I have to do this otherwise I won’t get a job or I won’t be recognized for the work I do.” But it made me very uncomfortable, and, after a few months of that I stopped. I said, “I can’t be who I’m not really as a person.” And now I always talk about how women should be women first. Whatever it is that makes you comfortable, you should dress the way you want to dress and then let your work define you. I mean, in my company actually we do this at team time, what are the things men and women do this, by the way, all of us do this as human being.

When we introduce ourselves notice this, we all introduce ourselves with a job title, and say, “Hi, I’m Padmasree Warrior. I’m CEO of NIO.” We never say who we are as a person. So when we hire new employees, when we do our team time, we introduce all our new hires and we have them come up and say one…some fun fact about themselves. “I love cooking. I have a two-year-old.” Or, “I play the guitar. I love rock climbing. I have a motorcycle that I love to ride on.” Whatever it is, right? Now, why don’t we say that about ourselves and we have to give ourselves permission to be authentic in who we are. So that’s something that I encourage everyone to do, both men and women.

Anu Hariharan – Given all the recent events, what tactical advice would you have for companies to sort of address this? What can organizations or even founders here, what can they do from day one to make sure they address it?

Padmasree Warrior – Firstly, I think have your pulse on the organization. It’s not an excuse to say, “I didn’t know this was happening and it’s obviously impossible to keep track of everything.” And when someone raises an issue make it a priority. In my company we’re now 350 people. I have a complete open policy, people come talk to me. And when they talk to me if they’re complaining about something we fix it, if we can’t fix it we have to go back and say, “We can’t fix it.” I think it’s very important if you’re the founder and CEO, you have personal accountability for everything that happens in your company and you have to take accountability for that.

I think it’s important to have a follow-up, right? There’ll be lots of complains like, “Oh, the cafeteria is too cold today,” or, “the food came late.” Some things are small, some things are more serious, but you have to pay attention to all of them. So, I think don’t minimize that and I think actually I feel like we compete for talent, right? In the space we’re in it’s very difficult to find the right kind of talent. A lot of people come to work for our company, for the mission, for the culture. I think it is definitely a factor.

Anu Hariharan – Well, thank you so much for taking the time today and for sharing these insights. Thank you so much.

Padmasree Warrior – Thanks for having me.