Going Through It

INTRO:

ANTJE DANIELSON: I felt comfortable because at that point, Robin and I were good friends. You know, our kids were friends. The kids would have playdates so we trusted each other with our children. And how can you not trust that person that you trust was your child to also be a good business partner?

ANN FRIEDMAN: Antje Danielson is an academic who studies energy and the environment. And in 1999, back when she was a researcher at Harvard, she had a great idea. They had these car sharing companies in Europe, and she thought, what if we brought car sharing to America? But before she could go on to found the company, Zipcar, she needed a co-founder to make it happen. And that ended up being more complicated than she expected.

I’m Ann Friedman and this is Going Through It: a show about how hard it can be to figure out when to quit and when to keep going.

On this episode: What happens when your business is working out, but your business partnership isn’t?

DANIELSON: There was one moment that decided whether Zipcar would happen or not.

I was working at Harvard, for the Harvard University Committee on the Environment. We had this meeting and it was sort of a work obligation that I would be at that reception. We had these tall tables and the lights were sort of flickering, and probably we all had a drink. And there was a fairly famous, wealthy, female Bostonian at the meeting. Maybe she stood there by herself, and I thought, “well someone should join her.” And so I did.

I ended up standing at the table with Teresa Heinz from the Heinz Ketchup company. So I told her about the idea of starting a car sharing company. And I had thought it through pretty well already at that point, I was just not sure of myself. So I ended by saying, “I’ve worked this all out but I’m not sure I can do this because I’m an academic and not a business person.”

FRIEDMAN: Why before you met this powerful woman at this event why hadn't you just gone ahead and done it on your own?

DANIELSON: I'm a nerd. I'm a scientist. [laughs] I was standing in the lab most of my time, you know, doing chemistry. And the the reason why I had come up was his idea of doing something about climate change is I had my first child a few years before that. So, at that time he was about six and, when he was born, I was like I really want to make a difference that goes beyond my generation that does something for his generation, as well.

FRIEDMAN: And is that how you pitched the whole car-sharing idea to Teresa Heinz?

DANIELSON: Well first of all I had based my thinking on the car sharing companies that already existed in Europe and most of them are really low tech. I mean you have to imagine, at that time in Europe they were putting boxes on trees and people had to get the car key out of that box. And so forth. I did not want to go that way. And the internet had been around, so all these things came together at a point of time where we decided to make Zipcar an internet-based company.

FRIEDMAN: Which, I have to say was very forward-thinking back in the late ‘90s. And so what does she say to that?

DANIELSON: This is the craziest thing. She just looks at me and she says, “Well that sounds good. Go for it!” And she said it in such away that I was almost sort of stumbling backwards. You know like her saying “Go for it!” in such a sort of trusting way. You know like, “yeah, you can do this.” So I walked away from this meeting, going, “Yeah! She said ‘go for it!’” And the very next day I went to bar with my friends and that was basically when I said, this is going to happen.

It was like all of a sudden I would think very clearly about what steps I needed to put in place. And one of the things that I had to put in place was I had to get some expertise in that would complement my own skills. And that was definitely, I decided, the business side. So that's when I ask my co-founder, Robin Chase, if she wanted to be part of this, because she had a business degree.

FRIEDMAN: OK, so tell me how you met Robin, or how that relationship began.

DANIELSON: [laughs] So Robin and I were basically friends. Our children went to school together. And we would pick them up from school and sit in the playground while they would play after school and Robin and I would sit at the side of the sandbox and talk about things. And Robin had told me that she had gone to the Sloan School at MIT, and she was a housewife at the time, but she was looking for something that she could apply herself to. This is interesting about Cambridge—you sit in the playground and you talk about really interesting things, like politics and research and psychology...and starting a company. And then after this meeting with Teresa Heinz, the next time we sat in the playground I said, “well here’s an idea…” [laughs]. “What do you think of this?” [laughs]

FRIEDMAN: And were you convinced that Robin was going to be a great partner for you?

DANIELSON: Yeah. I sort of described Robin and what her qualifications are and so forth. And amongst sort of my circle of friends, we were coming to the conclusion that Robin would be a good first candidate. And I felt comfortable because at that point, Robin and I were good friends. You know, our kids were friends. The kids would have playdates, so we trusted each other with our children. And how can you not trust that person that you trust was your child to also be a good business partner?

FRIEDMAN: Which seems to me like kind of a big leap, but maybe not so much if you have a personality type where you’re just likely to trust people? I don’t know.

DANIELSON: Oh, some people think I'm naive. [laughs] My mother had the same trait, and when I was a teenager I was always saying to her “You are so naive, you are so trusting.” And now I do the same thing.

FRIEDMAN: Well, I mean I guess finding a cofounder is always risky, and you said that Robin had gone to the business school. I mean that doesn’t seem so naive to me.

DANIELSON: Yeah. Because I think one thing that is actually quite important when you start a company is sort of an inroad into funding. And that is much easier when you have gone to a business school that will connect you to angel investors and so forth. So once she was on board, that part of starting the business seemed easier. And I'm not 100 percent sure if I could have pulled that part off by myself.

FRIEDMAN: Did she say yes right away, like there on the playground?

DANIELSON: She said she had to think about it. And she thought about it for a few days. And then she came back and said,” Yeah why not.”

FRIEDMAN: So how was it in the beginning?

DANIELSON: Starting with the business was extremely exciting. We were doing pretty well for quite a while. And I think it started to become difficult when we had to make some major decisions and we didn't agree on those major decisions.

FRIEDMAN: Could you give an example?

DANIELSON: Yeah yeah yeah yeah. So the the first occurrence really was we had to hire a chief operating officer. Someone from MIT, one of her old professors was giving us the reference of this guy he knew. We interviewed him, and I liked him. He was very very competent. But he was sort of a manly man, you know, and he had worked for the Air Force before. And let's say he was not culturally aligned with Robin and myself. But uh...so we hired him. And after a month, Robin felt... I think she felt threatened by him. I didn't. But she fired him after I think a month and a half.

And it set us back a few weeks and a few weeks can be very crucial, you know really in the beginning of a start up anything that you do wrong could really kill your business. We also lost some some trust from investors because they actually liked the guy too.

FRIEDMAN: Did you feel resentful about the fall out from that?

DANIELSON: You know I'm not that type of a type of a person. It's so funny because I'm a super positive person and I'm really trusting of fate and people. I felt a little bit of a bitter taste but not not resentful at that time. It was the first inkling of there being something not quite right.

FRIEDMAN: Was there a moment where you were like, “oh wow this has gotten really difficult,” or “this is sort of affecting our ability to effectively do what we want to do”?

DANIELSON: Yeah there was. So when we started off we had 50/50 shares. So I had 50 percent, she had 50 percent. And after a year and a half she said she wanted to have more than 50 percent of the shares. And I didn't see why. Honestly, I worked just as hard as she did.

She just kind of portrayed it as if she was doing more work than I was doing. And that was true actually, because she was a paid employee and we had made the decision that she would be our first employee while I still had a position at Harvard at that time. So she was basically an employee. And I tried to explain that to her. And it just didn't sink in with her.

FRIEDMAN: So how did that all come to a head?

DANIELSON: I remember this one day where we had been eating out. So we had gotten out of the restaurant, and in the restaurant we already had a pretty heated discussion about whether she should have more than 50 percent or not, but we hadn’t come to an agreement. And there was really wasn't an agreement. I was not giving her any of my shares. And we were walking around the block, and around the block, and around the block, and she was just getting... so aggressive. And I didn't know what to say anymore other than, “look you are an employee of the company. We can give you employee stock options that will bump your shares up, but I will not give you any of my shares.” And so that was the moment where I knew that it wouldn't go any much further.

FRIEDMAN: Now with hindsight do you feel like you can see her perspective on why she did want the shares? Why she was making the choices she was making for the company?

DANIELSON: No. I can't. I should have offered her less than 50 percent. And in that case our positions and roles would have been very clear. But because I was a beginner in the entrepreneurial space, and because she was my friend, and because I have this trusting nature, I was pretty much sort of an in la la land and about the power of money and the lure of power. In fact when I think back to that moment I just go: that was the biggest mistake I ever made.

FRIEDMAN: And then what happened?

DANIELSON: It was after a meeting with our advisory board that she basically said, you know… you have to go.

FRIEDMAN: Whoa. What was your gut saying in that moment?

DANIELSON: Oh my gosh. I was going out of her office going like, “What just happened!?” [laughs] And I sort of just came out of her office, sat in my chair, and one of our employees, Larry, was standing there and I just looked at him and I said to him, “She just fired me!” [laughs]

FRIEDMAN: What did Larry say?

DANIELSON: Larry just looked at me and said, “No way!” [laughs] And then I just packed up and went home…

FRIEDMAN: I can't believe that you can laugh about this moment now.

DANIELSON: Well, it's a long time ago.

FRIEDMAN: At what point did you come to the conclusion that you were going to leave, and that you weren’t going to fight her on it?

DANIELSON: I was probably home around 1:00 or 2:00 o'clock and I brooded over it all afternoon. And by the evening, I had worked out a plan. The difficult part was that I had actually just quit my job at Harvard and I was supposed to start working full time for Zipcar with a paid salary—

FRIEDMAN: What!?

DANIELSON: —basically imminently. Yeah. And I was also the breadwinner for my family.

FRIEDMAN: Oh my god.

DANIELSON: So it was an existential situation for me actually. I just had to keep it together to get it going. I could have put up a fuss and I could have made a huge deal of it. But at that point, we had had so much press and we were such a sensation that I think the press would have just had a hoot tearing us apart. Taking these two women who thought they could start a company and now they're getting into a cat fight, and so forth. I was just afraid that that would be the end of the company.

And so I said OK. And then I negotiated a deal that was pretty good. And I left.

FRIEDMAN: Was there anyone who tried to talk you out of it? Who said, “Look this was your idea. This is your company like you shouldn't leave.”

DANIELSON: Almost all my friends. And my children are still so bitter about it.

FRIEDMAN: What did they say to you? What are the kinds of things that they said when you told them you were leaving or considering it?

DANIELSON: They they basically said I should have sued and I should have made sure that she was kicked out. Actually, you know she had to leave pretty soon afterwards as well because she screwed up an investment deal and the board didn't take kindly to that either.

FRIEDMAN: If you could time travel back to maybe just after that conversation you had in the hotel lobby with Teresa Heinz what would you tell yourself about starting a business like Zipcar? About going into business with friends, about trying to embark on a start-up. What did you learn?

DANIELSON: I would say the first few months were wonderful to do this with a friend. Maybe I could have safeguarded a little more, and put some ground rules in place to salvage the friendship and so forth. I was just not very good at that.

FRIEDMAN: Like what sorts of ground rules? I mean I speak from personal interest. I have a business with some friends and I would love your advice on what are the specific things that you wish you had done to make that a healthier working relationship?

DANIELSON: Just anticipate that your relationship is going to change. That the friendship might just sort of go into the background. Make sure that you see your friends when you are in the professional environment as professionals and colleagues, and that you have some mechanism to then also do friend things with them outside that have nothing to do with the actual business.

FRIEDMAN: Do you ever think about what would have happened if you hadn't agreed to leave? What would have happened to you and the company if you'd said “no I'm going to dig in and stay here?”

DANIELSON: Oh that would have been mayhem. I would have taken a lawyer. She would have taken a lawyer. We would have ran up lawyer bills which would be very difficult because I had just quit my job. [laughs] And literally every penny we had was in the company. The atmosphere in the company itself would have changed dramatically. Trying to pull something like this off in a toxic environment where the two founders sort of don't talk with each other and sue each other? That's just impossible. I think the company would have gone belly up.

FRIEDMAN: And what about Robin, do you guys still talk?

DANIELSON: Robin and I still don't talk. [laughs] We live in the same town and we still don't talk.

FRIEDMAN: So how do you feel then about the fact that the company continues to be a success and to be out in the world and to grow? What do you feel when you see Zipcar pop up in the news, or when you hear about it? Like what's the feeling that you get in your heart and your chest in your stomach?

DANIELSON: I'm so proud of it. I don't know if you know but Zipcar was acquired by Avis. And so the other day I was in Texas doing some work at Texas A&M and I flew into Houston. And there in the Houston airport in the rental car area, there is this big Zipcar sign. And I just want to go around and tell everyone, “Me, me!” I'm pointing towards myself right now. “This was me!” [laughs]

OUTRO:

FRIEDMAN: Antje Danielson still lives in Cambridge, Massachusetts where she is the Director of Education at MIT’s Energy Initiative. And she continues to work alongside friends, though, she says after her experience with Zipcar, she’s created strict boundaries for herself...

DANIELSON: In the workplace, we’re colleagues. When we’re out of the workplace, we’re friends.

CREDITS:

FRIEDMAN: Going Through It is an original series from MailChimp. And I’m your host, Ann Friedman. My personal Teresa Heinzes are Eleanor Kagan, Megan Tan, Gabrielle Lewis, and Claire Tighe. This episode was edited by Joel Lovell. It was scored and mixed by Hannis Brown. Thanks to the nutty bro-fessor Max Linsky, and everyone at Pineapple Street Media.

TEASER:

FRIEDMAN: On the next episode… what happens when, to do your best work, you realize you’ve got reform your industry… or maybe the entire culture?

ELLEN PAO: When the news of my lawsuit became public, there was a wave of reporting and a wave of trolling. I was “selfish,” I was “slutty,” I was “stupid.” I was “not a hard worker.” I was “trying to take shortcuts.” I “hated free speech.” You know there were all of these things that are so not me.

FRIEDMAN: Former Reddit CEO Ellen Pao tells me about her choice to keep going through it in the tech industry, or save herself, and walk away.