Michael Cheng (middle, holding cheque) co-founded Lumen5 in 2017
The Vancouverite digs on keeping workplace culture strong and trying to scale up
Michael Cheng turned 31 last month. That might be startling to hear for anyone in the Vancouver tech scene who’s gotten used to the homegrown kid’s presence. After all, the SFU grad completed his degree in interactive arts and technology in 2011 and immediately co-founded web design agency WittyCookie. Cheng served as CEO there until he left three years later to co-found link management platform Sniply.
Three years later (are you sensing a trend here?), he and his cofounders sold Sniply to German entrepreneur Tim Schumacher. Cheng and company then spawned another venture, Mount Pleasant–based (though all its 40 employees are working remotely) video creation AI service Lumen5.
We talked to Cheng about the challenges of scaling a startup during COVID and whether he’s thinking about jumping ship anytime soon.
1. How have things been for Lumen5 during the pandemic?
It’s been good. It’s kind of interesting—a startup’s strength is adaptability, being nimble and evolving rapidly to different situations. [The pandemic] has pushed me as a founder to prioritize and think about what I care about, and it’s given us all an opportunity to push ourselves to be creative and innovative, and look out for one another in ways that come naturally in person. These are challenging times, but I think that’s what everyone signs up for. Everyone who joins the startup is here to do crazy things, and this is just a year that really exemplified that.
2. A lot of startups emphasize workplace culture. How have you kept that intact?
One thing that’s always been important to me—especially when we went remote—is the idea of presence. You’re sitting there, and you know other people are around you. And that was one of the first things that quickly disappeared when we went remote. The first thing I went to work on was looking for digital avatar solutions. I know that sounds a little crazy, but there’s a lot of great solutions out there. What we settled on was a virtual office application; it’s these little chat heads that sit around a room. So when I’m sitting at my virtual desk, I can see my team sitting around me and other teams sitting in other rooms.
It’s kind of cute, but it provides this sense of belonging. They’re not sitting in an office alone; everyone’s kind of there at the same time. That’s one one of the drawbacks of Slack and Zoom: unless you’re actively engaged in a conversation, you don’t know if people are there or by their computers at all. The virtual office was one way of knowing, even when you’re not communicating with anyone, that they’re there. It puts the mind at ease.
A lot of this year has been, how do you help the team deal with isolation? So that was one of the first things we did. But other than that, we’ve carried through adapting our previous cultural practices. We used to have these great team picnics, because our office in Mount Pleasant was right next to this big, open grass field. So what we’ve adapted to is we send people food right to their homes, and we have virtual picnics in each of our living rooms.
Beyond that, we’ve adapted things like card games and board games into digital games—Jackbox, digital Cards Against Humanity, those kinds of things. We changed the way we do things, but the intentions behind them haven’t changed. We’re still thinking about building that team environment, in a slightly different world.
3. You’ve been able to launch a bunch of successful startups. What have they had in common?
The kind of entrepreneur I was 10 years ago is very different than I am now. I think one thing that has changed for me is timing and innovation has become significantly more important. If you look at some of the earlier things I’ve done, they’re things like web design agencies, marketing agencies.
What I’ve really gotten involved with over the past five years is innovation—how do you build something that’s never been built before, to solve a problem that’s not being solved? Lumen5 has been a great example of that. We started it right when videos started taking over social networks. Nowadays on Facebook, LinkedIn, Twitter, there’s video everywhere; it’s kind of common. But at the time, it was still up-and-coming.
People were still using After Effects or Premier or hiring professional videographers. In my opinion, a great product or a great company is built with timeliness in mind. Which is to say if we launched Lumen5 five years prior or later, it would be too early or too late. The best solutions are usually delivered right on time. And I think that was true for Sniply as well.
4. It’s been almost four years at Lumen5. You exited WittyCookie and Sniply after three years each. Do you think you’ll stick it out with Lumen5?
Lumen5 is the largest company both in revenue and headcount that I’ve run. And it’s really a new stage in my career. I think the stories with my previous companies have almost been, how do I as an owner-operator run a lean startup to scale a company with as little resources as possible and wearing many hats and doing a lot of those things myself? And throughout those experiences, I’ve enjoyed being the one building the website and also playing product manager and sales and customer support, doing a lot of those things that founders do.
With Lumen5, I wanted to take a very different approach. I want to learn what it means to be a CEO for a larger company—we scaled the teams in a much more aggressive way than I have in previous companies. Within the almost four-year timespan, we’ve grown to 40 people and continue to hire very aggressively. That’s a new skill. Transitioning from a founder to chief executive has certainly not been very easy, but I’ve found that I’ve really enjoyed it.
Building teams, building community, building culture and values, and instilling that in each additional team member who joins is something that I really enjoy. And even during this year, one of the great things we’ve been able to accomplish is no layoffs, and we’ve doubled the team over the past 12 months.
There are a lot of unfortunate layoffs that are happening, and for us to provide that level of job security and additional opportunities for people who have joined us this year feels like an impact beyond what I’ve had before.
5. What do you think is the future of Vancouver tech? Someone like you, might it turn into a big fish in a small pond situation? Will you always live here?
I get asked that question sometimes, and my answer is always that Vancouver is in a perfect spot, in my opinion, which is why I’m here and why I’m here to stay. You look at something like Silicon Valley, which is a bit more of a mature ecosystem. It’s hard to hire, hard to keep people, makes it really hard to build a culture. Because I think a stable culture requires a steady base and high employee retention. Culture builds as people stick around for a long time; it’s hard to do that in these more mature ecosystems. It’s also hard to build a company in an immature ecosystem when the talent isn’t there.
And what I love about Vancouver is we’re in this perfect spot where you’ve got companies like Clio and Hootsuite, where you’ve got a good base of startups that have seen that rapid growth. And when you start to see these Hootsuites and Clios become larger companies, hundreds of employees, that talent starts to spread.
People say, Well I want to have a bigger impact; I want to join a smaller startup. So Vancouver actually has a great source of people who’ve seen these $100-million growth trajectories. And that’s fantastic. That’s the type of people I think an earlier-stage startup like Lumen5 needs, people who’ve seen that $100-million growth curve to come in and bring that. And at the same time, the ecosystem isn’t so mature that it has that kind of mercenary mentality. We have the opportunity to bring in that level of talent and keep them, too. I think that’s been one of the main reasons I really enjoy being in Vancouver and plan to stay.