Protect the User: Pinterest CEO Bill Ready

0:00A CNBC original podcast. Every leader's journey is shaped by a handful of defining decisions. Those moments of risk, doubt and conviction that influence their lives and careers. In this podcast, we get to hear the stories behind those choices. Welcome to Executive Decisions with me, Steve Sedgwick. In this episode, I speak to the CEO of Pinterest, Bill Ready. We can get sort of trapped in the constructs of what we think is possible. I actually think for all of us, so much more is possible than what we imagine. Bill grew up in a small town in Kentucky, working in his parents' auto repair shop. His early goals were simple, become the first in his family to go to college, get a stable job, and have health insurance.

0:43But he went on to exceed those expectations and moved from the shop floor to Harvard Business School, Silicon Valley, and eventually the C-suite. The further I've gotten in my career, the more I look back and see a lot of the best lessons actually came from that little town in Kentucky, that little auto repair shop. As CEO of Pinterest, Bill faced his toughest decision yet, making the platform private for users under 16. It was controversial, but it was guided by a strong sense of accountability. Users become sort of nameless and faceless. But for me, I see every single one of them staring back at me.

1:15These are Bill Reddy's executive decisions.

1:21You have an amazing CV. I can't work out what you evolved to and from. VC, working for the big corporations, working for small corporations, being a CEO, setting your own companies up. How would you describe yourself? I did five startups, so I still consider myself primarily an entrepreneur. Yeah. Although I was an accidental entrepreneur. I didn't – grew up in a little town in Kentucky. Um, and, uh, you know, my, my aspirations were as the first, my family go to college and my aspirations were, you know, get a stable job and, um, have health insurance for family, you know, didn't have health insurance growing up, uh, you know, grew up in, uh, you know, a place where, you know, I needed government assistance to get to college and things like that.

2:03So get to college, graduate, get a stable job, actually have healthcare for the family. Um, those are the goals, but then have ended up having the good fortune to have built, you know, multiple of those two billions of dollars in revenue. And so I've ended up running larger companies as a result of that. But in my heart, I'm an entrepreneur and a builder. Let's go right back to Kentucky. I know you work for the family business, the garage, and you worked really hard from a young age. Tell me about the key influences and the people you drew inspiration from when you were very young. Yes, my parents were our small business owners, a little auto repair shop in a small town in Kentucky.

2:41And so, you know, I grew up working there and, you know, later on in life, I'd get to, you know, Harvard Business School and McKinsey and Silicon Valley and all those places. The further I've gotten in my career, the more I look back and see a lot of the best lessons actually came from that little town in Kentucky, that little auto repair shop of just, you know, what it means to take care of customers, what it means to do the right thing by people, what it means to have a long term relationship with your customers. And, you know, and so those were instilled pretty early on. I always say I started working out a repair shop when I was 13, but that was when I started working on cars.

3:13Before that, I'd paint the building and, you know, repave the asphalt and, you know, started like seven or eight years old. So hard work was a must from the beginning. Did you enjoy the hard work? Not then. So, again, these are things like the more time goes by, the more I appreciate how valuable these things were. You know, at the time, I was like, oh, my friends are getting to do all these other things and I'm here working. drive by while I'm out there, you know, sort of, you know, working in sort of wave and think, oh, wow, I wish I was doing that. And I look back now like, oh, no, those are like really important lessons.

3:44So there's no way you could have been successful as you've been in Silicon Valley and elsewhere and these extraordinary companies you've worked with, for and created if you didn't have a strong work ethic as well. Has that been instilled in you that actually a job isn't just nine to five? I think that's right. I mean, I would say, you know, for my family, a lot of it was just necessity. But I think the work ethic was definitely their military family. You know, my dad woke me up to the Navy Reveille every morning for, you know, 18 years, just about. So, there are definitely things like that. You know, that little town in Kentucky was just outside of Fort Knox.

4:21You know, so, you know, grew up outside of a military base. And so, a lot of those things, you know, sort of in terms of discipline and work ethic sort of rubbed off in that. But a lot of it was, you know, hard work out of necessity, just because it was, you know, you know, I always talk about, you know, the link to doing good things for customers is sort of, you know, instilled in early age, because we literally, you know, if we took good care of customers, and business was good, then we ate well. If things weren't going great with customers, you know, then it was, you know, we go to the grocery store on the other side of the town where, you know, the meat was only expired by a few days and, you know, probably wouldn't make you sick.

4:59So that linkage of like, Hey, take care of customers and good things happen for you. Uh, we're sort of there from early on, but it was out of necessity. But I actually think, you know, as an entrepreneur, one of the things back to like lessons I didn't realize were such powerful lessons then necessity is the mother of invention. You know, I'm a huge believer in the theory of constraints like Silicon Valley. Um, you know, so much of Silicon Valley, people talk about tech Titans and things now, the story of Silicon Valley is not one of Titans. The story of Silicon Valley is one of, oh, an upstart with, you know, no resources, but, you know, a lot of imagination, a lot of hard work, and a lot of ingenuity can go take on massive incumbents.

5:35That's how Silicon Valley was born. Tell me about taking responsibility as well of your mistakes. So I was 13 and had just started, you know, actually working on cars in the shop, and I had messed up on a farmer's truck. What did you do? You know, I actually don't need it. It was a careless mistake. It's sort of actually less the mistake itself, but more that we're going to need to keep it for an extra day for me to sort of redo the work that I had done. And, you know, I'm sort of expecting my parents to go explain to him what I'd done. I said, no, no, you go tell him what you did and what you're going to do to make it right.

6:0613. And, you know, as I tell the story, people oftentimes imagine it's going to be like a Norman Rockwell painting or something where the farmer's, oh, son, it's all right. Don't worry. No, he needed that truck for his livelihood. Like that was, you know, it was a place where like most people were living paycheck to paycheck. And he needed that for his livelihood. And he let me know it. And so even I've told that story a few times, even telling it now, like every time I tell it, I feel the lump in my throat of like what it felt like at 13 to stand there like knees knocking and having to look somebody and I explain to them, you know, the mistake I made and what I was going to do to make it right.

6:40And, you know, back to like powerful lessons from early on. I think one of the things that has happened in tech is that, you know, there's so many people running platforms with hundreds of millions or billions of users. and I've had the good fortune to work on products that, you know, that have served billions of users. But I think, you know, so many, for so many people that are working on these products, they don't have to sort of look eye to eye, you know, with all the customers. And with hundreds of millions or billions of users, users become sort of nameless and faceless. But for me, you know, I see every single one of them staring back at me.

7:12And I have that same, when we make decisions about what we're going to do, like, you know, That's sort of my bar is could I look someone in the eye and say I did my level best to do what in my heart of hearts I felt was the right thing for them. Bill, that's going to come up later in your story when we talk about Gen Z as well and your extraordinary actions. I don't want to come to that. You grew up in, for want of a better word, a really tough rural environment where it was really tough for the customers. It was tough for your family, paycheck to paycheck, customer to customer. You got to the University of Louisville.

7:42Tell me about that. The first one in your family. Yeah, that was sort of the dream was just to get to college. Was it a dream? Absolutely. But you or your parents or both? I'd say my parents always wanted me to do well. They didn't know what was possible in that. And so they wanted me to do well in school, things like that. But I think certainly for my dad, his dream was two things my dad would reliably say to me when I see him. You know, the first one shakes my hand and say, you're still not working for a living, you know, not enough calluses. And the second is only half, he's proud, but only half joking.

8:21He'll say you could have been a damn fine mechanic, which is, you know, and the business is still here waiting for you. So, but it's great grounding, you know, for those things. But back to University of Louisville, you know, yeah, just getting to college was a dream. The day I stepped foot on campus, I felt like I had made it. Did you feel part of it or did you kind of think, wow, should I be here? You definitely have those feelings. University of Louisville, it's funny, then that was the big city. So University of Louisville, Louisville is a mid-sized city in the US. But from where I grew up, it was like, oh my gosh, they had one-way streets and parallel parking.

9:00All these things were very different from where I grew up. And so that was a big dream at that time. Big dream and big decision. And this is called executive decisions, and most of our conversation will focus on your business decisions. But in many ways, it's kind of the biggest decision you ever made in your life, you know, not to work with your father, not to become a mechanic, not to have calluses on your hands. You know, a huge decision to become the first person in your family to go to university. You know, this is one of the things I think a lot about is that I think, and it's actually not that unique amongst entrepreneurs.

9:33you look at Silicon Valley, like why does Silicon Valley skew significantly towards immigrants? So we built it, had to take a leap to go take a chance. I'm willing to, you know, sort of take that leap without knowing what was on the other side. And, you know, but I think when I've talked to people that have done that and they have, you know, sort of traveled a long journey to get to where they are, you know, yes, there's a lot of hard work in that. There had to be some aptitude in that, but they're also, you know not just some good fortune you know who are the people along the way that were the nudges in the right direction you know and and so um you know i think about you know who are the teachers along the way that you know said hey you could do this your mother yeah bought you these encyclopedias yeah and she had to work overtime to do it and that but and so you know she wasn't pressuring me to go to college or you know these things she just you know wanted me to do the best i could do um and i remember you know she had to work overtime for me to get those and so i I remember like cover to cover, read them all as a kid.

10:28If I could go back and talk to the younger me, like I'd say, dream bigger, dream bigger. And people say, hey, Bill, like hasn't, haven't, you know, from a small town in Kentucky, haven't things where it's like, well, I just didn't know how big to dream. And sort of for me, it was sort of each stage along the way, like run the hardest I could to the furthest horizon I could see. And then you get to that and then there's the next horizon and you run hard for that and there's the next horizon. but you know that's if I could go back I'd say dream bigger what would that have changed I don't know if it's usually I wouldn't change anything like because I think it was all part of what was necessary along the way the sort of you know the the deeper I get in my career the older I get the more I see like these were all foundational things it all happened as it should have and even the things I thought were really hard in the moment were these were you know you know these were learning moments these were you know character building moments but you know I think for all of us we get you know you know we can get sort of trapped in the constructs of what we think is possible I actually think for all of us so much more is possible than what we imagine.

11:38Tell me about some of those academic mentors was there someone who said Bill, you can do this. You're not that country mouse. Actually, you are really smart and you've got a great future. There were multiple along the way, more than I can name. I remember one of my professors in the computer science department, he actually taught Harvard Business School case studies. And he said, hey, Bill, I love that you came here to the University of Louisville. You could be there. And so that was sort of what prompted the leap to go to Harvard Business school as well as the first two startups i was the first engineer and you know they one was a you know we as a dot-com ipo but there's also a dot-com crash and burn um and the second one's sort of the same way and the lesson i learned from that is that you know the products were good uh the software for both of those actually still runs today uh 20 plus years later um but the the business model didn't work so i was like oh i've got to figure out the business model side too and so i wanted to do that but you know the uh actually multiple professors in the computer science department like hey bill you could go do that but i remember specifically there's one of them that he taught harvard business school case studies and he's like bill you you you could do that rural kentucky yeah working in your your parents auto shop to harvard business school wow yeah that was you know might as well have been like going to the moon um so um yeah i can see like i said never had even met somebody that went to an idly school so but but again this is where if you're honest with yourself who are the people along the way that gave the encouragement right like i didn't even imagine that was possible for somebody like me from a place where i came from um and uh and so you had those people that encouraged i'm hearing only positivity and and mentors and encouraging people but they're people who just said you are that country mouse were there people trying to put you down and and did that drive you sure yeah um uh i don't talk about those as much um because i like to focus on the positive it's interesting my wife and i both had similar experiences on this.

13:32You know, we didn't go, we went to the same high school with the same university, but we had similar experiences in elementary school. And mine was like, I was from the wrong side of the railroad tracks. Her, you know, she had started school in Korea and then came to the U.S. But same experience, which was, you know, first grade, they sort of separate you up into reading groups and there's sort of like, you know, low, medium, high. And, you know, I got put in the low group. Um, and I remember saying to the teacher, like, Hey, I can read those books and no, no, no, you're over here. Uh, and I think a lot of it was just like, yeah, I was coming to school and clothes that other people had donated and, you know, things like that.

14:12And so it was, you know, off of, you know, the sort of assumption of sort of, yeah, you're from the wrong side of the railroad tracks, like you're over here in this group. And it wasn't until third grade was the first standardized test. And, uh, and so there's been lots of criticism, standardized tests, things like that. And like, there's always room to improve these things, but I would say standardized testing, you know, was one of those things that probably changed my trajectory because, you know, after being consistently in the lowest reading group, I finally got a chance to prove like, no, I can read those books.

14:41And so it took the first standardized test in third grade. And then, and then went from that to like, oh, we're going to bus you to the other side of the county to a different school only for a couple days a week because, you know, there's a small town in Kentucky, so, you know, the resources are limited. But, like, that's a first early example of, like, oh, there's maybe a different thing is possible. Let me ask you a question. Are you driven more by the positive energy you get from people or by those examples when people have been negative about you and you want to prove them wrong? Honestly, it's both.

15:14And I would say, So those examples, early on, I'd say there were more people telling me what I'd never be than what I could be. You know, just by number of people, that would have been true. That's about them, not about you, by the way. Yeah, yeah. But sort of, you know, and at the same time, if I hadn't had some of the examples of like, you know, well, who's the one teacher that said you can't? Yeah. And so like on the one hand, I could say like, yeah, that was sort of fuel in the tank to say, well, now I'm going to go prove something different. but also if there hadn't been just the one that said no no you can't i don't know maybe you believe all that um and so but both are true and when i look back now um i think there's so much more to be had from positive energy than from negative energy but like i would say yeah that was part of the fuel in the tank how are you about handing out a decision you have to make with an underperforming employee but you you wouldn't be employed him if you didn't think it would good in the first place.

16:07Negative, positive, how do you cope it? That decision comes up all the time with someone in your position. I think as a leader, you've got to be able to balance both. I think at any moment in time, there are things going well and things that are not going well, or things are going poorly. And you've got to be able to look at both of those equally. And you've got to look at what's not going well, you know, to say, okay, here's what we need to do differently. But you've also got to look at what is going well to say, well, why is that going well? And how do we do more of that? And I actually think it's just about a balance between those because you know if if if you're overly focused on just what's going well then you'll be you know overly optimistic you get blindsided by things that could go wrong but you know if all you look at is what's not going well then you're going to miss the things that could be really great i had a professor in business school um who would talk about this that so much of how a lot of traditional feedback works particularly in like sort of u.s business culture um is you know you get your performance review and it's like well here's all the things you need to work on more Yeah.

17:06And, you know, he had done a lot of research that said, well, you know, hey, all of us, you know, have different attributes, different characteristics. And there's so much more value to be had by looking at what you are doing well and saying, of those things you're doing well, how could you be great at those things? and some things you're not doing well be aware of those don't have a blind side but you may have way more yield from investing in the things where you could be exceptional than saying the things that you're you know you're just you know mediocre at um you know uh i was never gonna play center on the basketball team no matter how much you coached me up like i wasn't gonna be sitting on the basketball team i wasn't gonna be a singer those were not my gifts um and so you could coach me all you wanted you give me all the performance feedback you wanted as like how to be a better center on the basketball team that just those were not my gifts but oh you know okay i could be a better mathlete than athlete what are you great at what do you what were you good at that you are greater i'll expose my own development opportunities like i don't like to talk about myself that much uh and actually welcome to executive decisions bill this is the podcast where you talk about yourself um but but i actually think that you know great leaders great leaders tend to give away all the credit uh and assume you know if something goes wrong they assume the blame and if something goes right they give away the credit um Um, and, but what I say, you know, has worked really well for me is, you know, having a bold ambition, you know, um, you know, and a bold ambition that, you know, that gets really great people excited and then really empowering great people to go do their best work.

18:36Um, and if I go look back at the five startups, if I go look back at sort of the best successes, you know, it was far less about me and more about who did we get around the table. And, you know, if you get great people working on something they deeply care about and really empower them, like it's amazing what is possible. And this came up with a podcast we recorded very recently as well. You get to a certain point with people, with good people. It's not about money. It's about other things. That's right. That's right. An early mentor asked me a really great rhetorical question. And he said, hey, Bill, with whom do you build your army?

19:14You know, do you want the conscripted? Do you want mercenaries or do you want freedom fighters? And like just instinctively, I said, well, freedom fighters, of course. And he's like, well, Bill, like you're going to realize like that's actually not what a lot of people choose because like freedom fighters, harder to manage. You know, they'll call you on your bullshit in a second if you're not real and you're not authentic. You know, but if you're authentic, they'll give you more than anybody else. What's your worst quality as a leader? Well, maybe just expose it, like not talking about myself.

19:46You know, we're all constantly developing. And I'd say this is, you know, one that I've worked on a bunch is that, you know, I think there's also a lot of value in like sharing your own vulnerabilities. Yeah. And I think for many leaders, that's a hard thing to do. Taking on big challenges, leading people through tough circumstances, you know, can feel like, hey, you should always have the answers. and it's hard to be vulnerable. But I've actually had some great lessons in that that in those moments when you do that, those actually can be great for the team too. They understand how they can support you because at the end of the day, if you've got the right people around you, you're all helping to make each other better.

20:25I'll give you a brief anecdote. One of my first big interviews about 15 years ago was a really tough big CEO and he just lost his CEO in a terrible accident in Russia. and his team didn't know him. They just know him as the hard guy, the enforcer. And we did this interview and he got quite emotional about his former mentor, his former boss. And his entire team saw that and they thought, oh my God, this guy is not only the tough leader we thought he was, he's also a really great human being who really cares. That vulnerability really mattered to his team. Yeah. I'll give a tangible example of this.

20:57For me is shortly after we had sold Venmo and Braintree to PayPal, which is a big transition moment. But, you know, at that same moment, you know, my wife and I were expecting our first child. And, you know, it's a clarifying moment of like, you know, I always loved, you know, building things, but also like, oh, that's a moment we say, hey, what really matters? But two years before that, you know, we had launched in 40 new countries. We were sort of building two startups simultaneously between Venmo and Braintree. And, you know, I was living on a plane, working nonstop. And so I set boundaries to make sure, you know, I could, you know, do the things I needed to do to be a good husband and a good father.

21:34Um, and you know, I remember eight or nine months into it, it was just, you know, I was just constantly feeling like I'm failing my team because I couldn't, I couldn't give them the 18 hour days I was giving them before. Um, and so for eight or nine months, I was sort of carrying that and sleeping less and less because it's like, okay, I'm going to make sure I'm there for, you know, uh, you know, for, for the moments I need to be, you know, on the family side, but then I didn't want to let my team down and then finally I had this moment where I was just like sort of broke down with my team I was like I know I'm failing all of you I know I'm failing and like here's why like because I want to be a good dad I want to be you know a good husband and I can't you know I can't handle all these things at the same time and you know I know I'm failing you um and they're like Bill this is way better you know because because you know as I as I had less time to be in all those things it had given them more room it gave them autonomy it gave them that's right ownership yeah their tasks rather than you managing them every second and it was forcing me to prioritize more about what really mattered most and so a lot about balance in your life that's right and and but that was a great moment of where like that vulnerability yeah which you know it took me eight or nine months to have that conversation to say i think i'm failing you but then by having that conversation it gave them the opportunity to say like bill this is a better version of you you've got a really big career and i i hate to do this but i want to get to pinterest but so in the meantime venmo braintree uh pre-google coo paypal google 2020 give me the best decision during that whole period if i say best decision of my career yeah um you know uh i think it's also the toughest uh so toughest decision my career you know at Pinterest, we were the first and still the only platform to do private only for under 16.

23:22And it was a really tough decision because, you know, it was shortly after I came in as CEO and to sort of give context. When I came in as CEO three and a half years ago, Pinterest was declining in users. You know, attrition was way up. Stock price was down 80 plus percent. And, you know, the narrative on Pinterest was that Pinterest was sort of aging up and aging out and had missed the next generation. And a few months after I came in, we made a decision to do private only for under 16. And people thought it was like, oh, well, you're struggling to get the next generation of users. Now you're definitely not getting the next generation of users.

23:57And I made that decision through two lenses. One, as a dad, I looked at what was happening and just very clearly, I could see that it's not safe for kids to be contacted by strangers online. By the way, say that out loud. And like, doesn't that just make sense? It's not safe for kids to be contacted by strangers online. Of course, it's not safe. But somehow we've all come to accept that. So that was sort of through the lens of a parent and through the lens of that kid in Kentucky that's got to look back at all the customers and say, hey, did I really do my level best to do right by you? The other lens was taking a bet that there would be real demand for safer spaces and that maybe that would be a path to win with young users.

24:40It was a huge leap. Hadn't nobody done it before, completely unproven. And so that was a really tough decision. You know, fast forward, you ask about the best decision. I would say it's been the best decision, both in that, you know, for us as a platform, you know, it's now the case that, you know, we haven't reported this most recent quarter, but as of the last quarter, they reported nine straight quarters of record high users. more than half the platform is Gen Z now. And if you ask them, one of the top reasons that they will give is they see Pinterest as a safe space away from the toxicity they experience elsewhere online.

25:17So it's been core to how we won with young users, but broader than that, even, you know, I always talk about like, we want to set an example. My goal in coming to Pinterest was to prove that you could tune AI for positivity, to prove that there could be a more positive business model for social media. And, you know, nearly three years later, you know, you now have real momentum in, you know, Australia just did a ban on social media for, you know, under 15. UK is having a look at it. You know, last summer, you know, when I was in France, I met with the Macron administration where they're considering it and actually have voiced public support for these things and actually said, like, not only, not only is this something that, you know, I think this industry needs accountability.

25:58But we actually, through that decision that was both the toughest and later the best, not just the best for our business, we actually proved it was possible that, you know, you could make a decision like this and the world didn't end and it could actually be good for business. And, you know, back to those early lessons, it shouldn't be that exceptional to invest in the long-term wellbeing of your customers and your users.

26:27I'm just going to recap. Gen Zers, born 1997 to 2012, the first true digital natives. You made this decision in 2023. It was a controversial decision to turn off the social features for under-16s. It caused a 26 % drop in your share price as well. Wall Street predicted it would kill the platform. This is an extraordinary leadership example. You were contrarian. You were told it was going to fail. this oasis from toxicity was going to kill your young fan base, user base, what have you. Brave decision. Did you feel it was – how did it feel when you did that at the time? Because you were lambasted.

27:08Knees knocking, lump in my throat. But, you know, I found this like time and time again, you know, across each of the businesses. What I've tended to find is that, you know, a lot of the best decisions were that, you know, the thing that was going to kill the business was going to kill the business before it saved the business. And I've seen that multiple times. You know, putting a social feed in a payments app, you know, with Venmo was very contrarian at the time. It actually ended up being a defining feature of the app. And by the way, also why, you know, a decade later, having seen some of the negative externalities that happened with social media, like I felt some responsibility to like prove a better business model for social media.

27:48The most high consequence decisions, you know, are oftentimes the best opportunity for impact. There's, others have said this, it's not my line, you know, but, you know, Formula One's exploded, you know, they'll talk about, you know, races are not won in the straightaways, races are won in the turns. And so these, you know, these sort of pivotal moments, you know, you win in the turns. And in those turns, oftentimes, it's not going with the pack. It's saying like, okay, what's a different way to do this that's going to feel way less comfortable, but potentially has way more potential for impact.