Everything takes longer than you think. No matter how efficient and organized you may be, there will always be unforeseen delays or challenges that impede your ability to move projects forward. Building in additional time for the unforeseeable and having alternative strategies handy is important for accomplishing your goals.
As part of our series called “5 Things I Wish Someone Told Me Before I Began Leading My Company”, we had the pleasure of interviewing Lauren Salz, co-founder and CEO of Sealed, a home wellness company that modernizes home heating and cooling to deliver clean air and comfort with less energy.
A Forbes 30 Under 30 alum, Lauren and serial entrepreneur Andy Frank founded Sealed in 2012 after seeing an unmet opportunity to lead the movement towards home electrification and to mitigate the impact from climate change. Lauren helped develop its innovative financing approach that covers 100% of home energy upgrade costs for homeowners.
Prior to joining Sealed, Lauren worked as an Investment Analyst at McKinsey & Company. Lauren holds a B.A in Economics from Barnard College and was also a visiting student at University of Oxford.
Thank you so much for joining us in this interview series! Before we dive in, our readers would love to “get to know you” a bit better. Can you tell us a bit about your ‘backstory’ and how you got started?
Throughout my life, I’ve been competitive inside the classroom and out. As an Olympic-style weight-lifter, rower and flute player, I always strive to push myself.
Aside from being competitive, I hate the idea of waste. I come from a family of immigrants who had to make every little bit count in order to put their children through college and hated being wasteful, largely because they couldn’t afford to.
I’ve long been interested in leading a company that could help make a societal impact. Andy (my co-founder who I met on Angelist) and I saw an opportunity to create value in the home energy efficiency space through making electrification and efficiency easier to access for homeowners. It was clear to us that scaling residential electrification was one of the biggest opportunities to reverse climate change.
What was the “Aha Moment” that led to the idea for your current company? Can you share that story with us?
I’ve always been fascinated by inefficiencies that exist in the market and how to improve them. This dates back to my time with McKinsey where I was focused on investing strategy that capitalizes on market inefficiencies. It was a concept that really stuck with me and inspired our mission to modernize every home to be healthy, comfortable, and clean for the planet.
Can you tell us a story about the hard times that you faced when you first started your journey? Did you ever consider giving up? Where did you get the drive to continue even though things were so hard?
Early on at Sealed, we had to be scrappy with our marketing research. A few of us, myself included, would canvass the platforms at Penn Station asking commuters questions about their attitudes towards energy efficiency. That is, until the day I was kicked off the platform by security.
Fast-forward to when we closed our first round of institutional capital, a major accomplishment for us. A couple of months later, a key utility partnership was delayed, which would impact our revenue plan. I was faced with a critical decision: forge ahead as is to achieve plan or pivot to become a D2C brand that, while unproven, was important for us to control our own destiny. We decided to pivot to this strategy, which ultimately paid off in a big way this year.
So, how are things going today? How did your grit and resilience lead to your eventual success?
Our gritty and resilient team is feeling the momentum build. Our new direct to consumer strategy is working well, and the new administration might provide another boost as the clean economy becomes big business. We’ve only scratched the surface in our goal to lead the movement towards home electrification, which will help reduce carbon emissions. We developed a transformative model that improves the health and comfort of homes. We’ve raised approximately 17M dollars to date in Q4 ’20, did 4x the business we did in Q4 ’19. We’re now gearing up for major nationwide expansion.
The growth we’ve achieved hasn’t been without its challenges. From navigating the complexities of a global pandemic to the resulting economic uncertainty, I’ve learned to trust and rely on my instincts to help me through the tough times. They’ve served me well as we’ve built our business over the years.
What do you think makes your company stand out? Can you share a story?
As our country takes urgent action to reverse the harmful impacts resulting from climate change, I’m proud that we’re playing a critical role in fueling our nation’s transition to a low-carbon economy through advances in residential energy electrification.
We take an innovative approach when it comes to converting homes to electrified HVAC. Sealed is the first energy company to finance home energy efficiency upgrades through energy savings. We cover 100% of the upfront costs homeowners face for upgrades like insulation, air sealing, electrified heating and cooling and smart home tech. This model has transformed the way homeowners pay for energy upgrades, using a patent-pending, machine learning algorithm that can predict energy use and savings with an accuracy rate of > 99%. We leveraged this IP to create a groundbreaking financial product that’s backed by a 5 million dollars debt facility from the New York Green Bank and an energy savings insurance policy from Munich RE.
Can you share a story about the funniest mistake you made when you were first starting? Can you tell us what lessons or ‘takeaways’ you learned from that?
One of the funniest mistakes I made was early on at Sealed when we were invited to attend a regulatory meeting held in NYC. I walked into the meeting room thinking I didn’t recognize anyone, nor did I quite fit in as a 25 year old woman in a room of 40-something year-old men. I sat down at the table anyway, and someone politely asked, “Are you here for the Dominion Pipeline meeting?” Turns out I went to the wrong room and was sitting in on a confidential meeting. It goes to show you that no detail is too small in the business world.
Often leaders are asked to share the best advice they received. But let’s reverse the question. Can you share a story about advice you’ve received that you now wish you never followed?
Being careful about cash burn was always good advice that I strongly adhered to — perhaps a little strong. In the early days of Sealed, we crammed 12 team members into a tiny office (less than 250 square feet!) given the lower rent. A crowded office environment however doesn’t take into account your teams’ comfort, which could also hamper productivity. Prioritizing your team over profits was an important lesson.
You are a successful business leader. Which three character traits do you think were most instrumental to your success? Can you please share a story or example for each?
1.Tenacity. I’m tenacious by nature and someone who’s not willing to give up on their beliefs. This was especially true when I made the decision to take time off before starting college; this was very important to me as I wanted to explore the world.
2. Risk-tolerance. As a business leader, you can’t be afraid to lose and must have a large appetite for risk-taking. Sealed wouldn’t be where it is today without having taken calculated risks along the way.
3. Empathy. I’ve always empathized with others in my personal and professional life; it’s important to put yourself in someone else’s shoes. Doing so can help better inform your own decision making and how it might impact others. Empathy in turn builds trust.
Which tips would you recommend to your colleagues in your industry to help them to thrive and not “burn out”?
One of the pitfalls in starting up a business is team burnout. It takes a lot of personal sacrifice to get ramped up. Maintaining personal boundaries is critical to avoiding burnout. Despite the relentless pressure that comes with leading a business, I always make it a point to never cancel personal commitments. This helps me stay focused on what’s truly most important in life.
What are the most common mistakes you have seen CEOs & founders make when they start a business? What can be done to avoid those errors?
Some of the most common mistakes I’ve observed CEOs and founders making (including myself) are:
- Communication. As the CEO of a startup, you can never over communicate. When it comes to communicating to your team, customers or investors, too much is never enough. It’s important to keep everyone apprised of updates in real time — positive and negative — and instill a sense of transparency.
- Risk aversion. Many CEOs shy away from making big bets, which can be challenging especially when the outcome is far from certain. As a business leader, you need to be decisive in your actions. Waiting too long to make a strategic pivot can mean the difference between profit and loss.
- Ceding control. CEOs have end-to-end responsibility for their businesses, so when its success or failure falls on your shoulders, it’s tempting to want to direct every single aspect. This is a mistake; you’re keeping some of your most talented business partners sidelined and not taking advantage of the expertise you hired them for in the first place.
In your experience, which aspect of running a company tends to be most underestimated? Can you explain or give an example?
Hiring and retaining top talent is often very underestimated in importance. Without a top-notch team, your company won’t thrive. Talent retention also means mentoring and communicating with transparency, and ensuring you’re providing a compelling reason for them to stay.
Ok super. Here is the main question of our interview. What are your “5 Things I Wish Someone Told Me Before I Began Leading My Company”? Please share a story or an example for each.
Running a successful company never comes without a few bumps along the way; here are five things I wish I had known before I joined Sealed:
- Most problems that leaders face aren’t unique to you or your company.
There are many common challenges that many leaders have faced before, regardless of industry. For example, when we’re dealing with a sensitive employee situation, while it may be the first time it’s happened at Sealed, it surely has happened elsewhere.
2. When seeking advice, be highly selective.
Everyone loves to give advice and claims to “know the right answer”, but that doesn’t mean you should take it all. It’s important to be highly selective on the advice you receive and learn to trust your instincts, especially if you get conflicting advice.
3. If you’re playing to win, you must be okay losing.
Succeeding in business requires having a high tolerance for failure. Even the most successful business leaders have failed at one point or another; sometimes more often than they succeed.
4. Everything takes longer than you think.
No matter how efficient and organized you may be, there will always be unforeseen delays or challenges that impede your ability to move projects forward. Building in additional time for the unforeseeable and having alternative strategies handy is important for accomplishing your goals.
5. The livelihood of your employees rests entirely on your success or failure.
As CEO, I’m responsible not just to our shareholders and business partners, but also for the lives of every employee. It’s a lot of pressure, but when you get it right and succeed, it can be one of the most rewarding and motivating aspects of your job.
You are a person of great influence. If you could start a movement that would bring the most amount of good to the most amount of people, what would that be? You never know what your idea can trigger. 🙂
I would want to lead an effort to get people to spend more time outdoors and participate in sports. I’ve devoted a lot of my time to weightlifting and outdoor sports, each of which has been incredibly rewarding to me personally and professionally. Spending more time outdoors and being active can have an immeasurable positive impact on your physical health and mental wellbeing and the environment.
How can our readers further follow you online?
Please feel free to visit my LinkedIn page, follow me on Twitter at @SalzLauren or instagram at @laurensalz or visit Sealed.com for the latest company updates!
This was very inspiring. Thank you so much for joining us!