The hits keep on coming for Verkada.
Verkada Faces Sexism, Discrimination, And Cultural Challenges
Photos of female employees taken from Verkada's own video surveillance system were passed around by Verkada sales managers captioned with graphic sexual comments, causing strife within the Silicon Valley unicorn.
Verkada, which has received $100+ million in funding over the past two years, was built on a recipe of hiring "great sales athletes", "copying" the old EMC model of hiring "half the football team" and making "the culture really fun for sales", according to Verkada Chairman Hans Robertson. Indeed, Robertson boasted of hiring "a lot of" Verkada's "sales athletes" from one small and wealthy Bay Area suburb.
However, this has created a working environment that many allege is reminiscent of a frat house, rife with sexism, drinking, and discrimination. Current and former Verkada employees say these issues all came to a head with the Slack incident, which exposed Verkada's favoritism towards this elite "crew" of sales staffers.
Update, December 2020: IPVM has released a video summarizing the events:
In this post, IPVM examines Verkada's workplace challenges in-depth:
- The Slack Incident
- Fallout from the Slack Incident
- The 'Danville Crew'
- "They Can Do Whatever They Want"
- Sales Playbook of Hans Robertson, Verkada Chairman
- Other Director Terminated
- Sales Party During Coronavirus
- Discrimination Concerns from Employees
- Sales vs Culture Challenge
- Verkada Responds to IPVM
- Verkada Email to Employees about IPVM's report
For background on Verkada, see previous IPVM reporting including The Fastest Growing Video Surveillance Sales Organization Ever - Verkada, Verkada Speaks On Disrupting Security Sales Channel, Verkada 2020 Cameras Image Quality Test and Verkada Video Analytics Tested 2020.
The Slack Incident
Verkada is headquartered in a large new office building in downtown San Mateo which (naturally) has a Verkada video surveillance system. However, the surveillance system is particular among other Silicon Valley tech firms because it is easily accessible by regular Verkada employees so they can show it off to potential customers.
Last year, a group of men at Verkada accessed the system to capture images of female employees without their knowledge and share pictures of them captioned with sexual jokes in a Slack channel, multiple sources independently confirmed to IPVM.
"It was a piece of [Verkada] software that highlighted faces and gave, like, a Brady Bunch view - one of things Verkada does is face match and search," a source said. One picture sent by a sales director was of particular concern as it consisted of a female sales employee captioned with a joke about 'squirting', multiple sources confirmed.
Fallout From The Slack Incident
When screenshots of the Slack channel came out, "there was nothing but proof" of its contents and participants, a source said. Although the 'squirting' photo sent by the sales director struck a chord, multiple men were part of the channel and multiple women were targeted, sources said.
In response, Verkada announced that some employees had had their stock reduced, but many did not think this was enough. "I was shocked. To me that's not just a fireable offense, that's a career-ending offense," one source said; another called the stock reduction "a slap on the wrist". At an all-hands company meeting, over 100 employees upvoted a question about the incident, pushing it to the top of the list, but it was not addressed. Overall, the incident "has been strategically avoided", a source told IPVM.
The "Danville Crew"
At least five senior sales staff are white men who went to the same high school in Danville, California, San Ramon Valley High, where they played sports (chiefly football). This contributed to a feeling among some female and minority staffers that moving up in the company was harder for people who were not white men from Danville.
"If you weren't part of the same five or six people who all grew up with each other in Danville, then you wouldn't get far", one source told IPVM, adding that "there were some exceptions of course, but the ones that got the easiest promotions were all within the same circle".
"They Can Do Whatever They Want"
The perceived lack of action taken after the Slack incident was viewed by many as evidence of favoritism towards the Danville employees from upper management. "There's a certain crew from Danville, they can do whatever they want - the company will [turn] a blind eye basically," one source said, adding "it's because these guys bring in a ton of revenue. They're in the upper echelon and so you can't get rid of one of them, you'd have to get rid of all of them."
The Slack incident "set a pretty awful precedent", another source said, noting "if you're part of the group of guys then you're protected. At any other tech company in Silicon Valley, you'd get fired."
Multiple sources told IPVM they felt that Verkada's upper management was "removed" and "aloof" from workplace climate issues. "There is a frat boy culture, it is driven by the co-founders and it's entrenched in the sales leadership who are all referral hires that the leaders know personally and who they are friends with", another source said. Notably, out of 13 people on Verkada's Leadership Team page, zero are women.
'Frat Boy Culture'
Multiple sources said Verkada's sales department was reminiscent of a frat house, noting that drinking and yelling to celebrate sales were commonplace:
[sales staff] were allowed to drink during company hours, whenever they made a sale they would yell, kind of like a frat house. It seemed like management supported and allowed this to happen too. They were too permissive with the sales team. Always giving favor to them. I did see when there would be a lot of meetings they would cater to the sales team. It was a Ra-Ra, cheerleading kind of culture.
Another source confirmed this, saying "frat boy culture" is "deeply ingrained" and that drinking was "taken to the next level" at Verkada, with "a lot of champagne" and alcohol to celebrate deals regardless of "what time of day it is". For some, this was part of what made Verkada an attractive place to work: "[the culture] was, 'you're gonna work very hard and it's OK that your job is somewhat miserable because we party really hard and we have a good time'."
The source also confirmed a permissive attitude towards frat-house style behavior, saying there was "a group of guys at the company who have worked together in the past or have been there for a long time, and they definitely protect their own and it's somewhat a group that can get as drunk as they want - and say whatever they want - to their employees, customers, partners, and there not be penalties for them".
Verkada Founder & Chairman Touts Hiring Athletes & Danville Residents
Hiring athletes - and football players in particular - is by design, as Verkada's Founder and Chairman Hans Robertson explained in a Silicon Valley Fireside Chat. The excerpt below features Robertson touting how he copied EMC's model of hiring football players:
We copied EMC. What does that really mean, EMC was famous for hiring half the Northeastern football team [...] basically they would hire for tenacity, energy, street smarts, that was sort of what we ended up copying
Hiring football players, of course, inevitably favors men since virtually all (American) football players are men.
Moreover, in the same chat, Robertson explicitly calls out how they hired "a lot" of their salespeople from Danville:
We had a bunch of people who were local, like grew up in the area, and they just like knew a lot of other salespeople, so I guess we have like 20 from Danville, or not 20 but 10, I mean, a lot
Danville is a small, wealthy suburb that is about two times whiter (76%) than California (36% white) while being less than 7% Hispanic and less than 1% Black (California is about 40% Hispanic and 6% Black.).
Overall, Robertson describes his "recipe" for a "culture of success" as "beating their quotas" and making "the culture really fun for sales", as the clip below shows:
Downsides Of Sales Culture
Eddie Vasquez, who worked a few months at Verkada as a contractor, said he found the atmosphere "toxic" and was "taken aback" by the regular drinking, which sometimes involved lewd comments about women:
It was one of the most toxic, unprofessional work environments I was part of. I do corroborate there was kind of a frat culture and all that
I did witness guys commenting on what women were wearing, like yoga pants or a certain top, [saying things] like that at work or while they were drinking. It was really inappropriate.
I was taken aback [by workplace drinking.] At Verkada it was a daily occurrence. Whiskey, tequila, wine.
Another source, who had an overall good impression of working for Verkada, concluded that "there are two very different cultures that exist at Verkada: that of the engineering team and that of the sales team. In my experience, the 'frat boy culture' is only a problem on the sales team."
Other Sales Director Terminated
Last month, a "third party independent investigation" found another sales director had "violated company policy" and was fired, per a company email IPVM reviewed.
Sources said this was related to Verkada's workplace issues.
Sales Gathering During Coronavirus
Also last month, sales team employees held an office gathering, with few wearing masks and no social distancing:
This violated San Mateo county public health orders that "participants of gatherings of any size must adhere to Social Distancing and Face Covering Requirements". This also violated Verkada's own COVID policy, which bans "social gatherings" with "no exceptions" and mandates masks within six feet of others, according to a company email obtained by IPVM.
Discrimination Concerns From Employees
Three sources independently told IPVM that ethnic discrimination was an issue. "If you look at the people who get hired and fired, there's an obvious track record", one source said. "For [people of color] it was be quiet, keep your head down."
In particular, sources said those who were not native English speakers/spoke accented English had a harder time getting hired and promoted. "If you're a native English speaker you will be viewed better than a non-native English speaker, even if you do the exact same work", another source said. This is particularly relevant in Silicon Valley which has many tech workers from places like India, China, etc.
Not everyone had negative experiences, with one employee telling IPVM they "love my job and the culture" and another saying she "feel[s] supported as a woman". Another said upper management was trying to fix cultural issues and "never seemed to approve of any inappropriate behavior".
Sales Vs Culture Challenge
Verkada is growing rapidly and having a determined Sales team is critical to increasing top-line revenue. This is a concrete metric that investors pay close attention to, particularly in Silicon Valley where scale is often prioritized.
However, clearly, there are challenges with such a top-line-focused strategy. As IPVM has covered, Verkada salespeople have made false claims in their pitches to potential clients. Prioritizing sales, and particularly hiring football players and residents of wealthy suburbs, can lead to a company culture where those who are not part of this group feel left out or discriminated against.
Verkada Responds to IPVM
IPVM previewed the key findings from our investigation, asking Verkada for feedback and for how Verkada is making improvements as they grow. Verkada's response is copied in full below:
As I am sure you’ll understand, we cannot discuss any details regarding individual employees out of respect for their privacy and wellbeing. We take our policies very seriously, and there have been and will continue to be repercussions for anyone who violates them. Verkada is committed to making our workplace safe and comfortable for all individuals; this is crucial to our goal of attracting the best talent in the world, and delivering the best products to our customers.
The information you collated has many factual inaccuracies, and some of it is opinion or hearsay at best. That said, we appreciate you sharing these notes with us, as we constantly strive to make our team better and to create an environment where everyone feels a sense of belonging.
We do not believe that your narrative accurately represents what it’s actually like to work at Verkada. We invite all prospective employees and candidates to connect with us directly, meet our leadership team, and make decisions based on primary data.
We asked Verkada to specify the "many factual inaccuracies" they were referring to but Verkada declined, saying:
Thank you for the offer, but as previously mentioned we aren't at liberty to discuss specific details.
Verkada Email to Employees About IPVM's Report
Shortly after responding to IPVM and before IPVM published this article, Verkada's CEO Filip Kaliszan sent an email to all employees defending Verkada's record and confirming that disciplinary action against relevant employees has been taken ranging from "financial penalties up to termination".
The email is posted below:
Verkada's CEO also contended that the lack of diversity was a result of their "humble beginnings", saying in the email:
Verkada's humble beginnings date back to 2016 and my living room, which was our first 'office'. Back, then, it was hard to get people to come hang out to check out what we were building, let along hire anyone to join us.
It was not that 'humble', as Verkada's founder is Hans Robertson, who started Verkada after he had sold Meraki, a company he co-founded, to Cisco for $1.2 billion.
That noted, Verkada clearly has grown, with 415 employees now and a growing number of diverse hires beyond the core ex-Meraki and Danville employees.
Undoubtedly, Verkada is trying to handle and rectify the sexism, discrimination, and cultural challenges they face. The question remains how well they will do with that, and how much are they willing to trade-off growing sales to establishing a better company culture.
This is not surprising what so ever. When you run this type of high pressure sales organization this is exactly what you get. Doesn't make it right but that's what you get when you put a bunch of high testosterone, who can hike their leg higher than the next guy, sales chumps together.
Again this is the same mentality as the 90's boiler room telemarketing companies!
I worked for a company back in the early 2000's and we had a telemarketing department back when you could still call residential customers. Our main vertical was residential. You name it and it probably happened with that group. Let's just say I kept my office door locked when I wasn't there, which was a majority of the time.
Thank you IPVM team for the reports you do and letting people know about the workings of the industry. I love how they say you just don't like them. I seem to remember not to long ago there was some scathing reports about a couple Industry Giants and their practices. Specifically about "Partner Events"...Keep up the good work.
Anchorman comes to security... Nasty
Anchorman has been in security since the 90's!
what i find intriguing is that they built a tremendous amount of success using this sales model
obviously sexism and on the job drinking is unacceptable
the question is, as much as people knock this type of aggressive sales method, is there any value in this approach and can it be deployed without hurting or alienating others
in other words a clean version of it
Anchorman comes to security.. Cleaner Like a Wolf of Wall Street version? :D
a clean version of it
What is allowed in the clean version? Is on-the-job drinking allowed?
Did they ever acknowledge or addres the drinking when you asked them for comment?
#3, Verkada's entire response to IPVM is posted in the article. They did not address drinking in the response.
Is on-the-job drinking allowed?
For people voting this funny, I am not kidding. While I am not in favor of on-the-job drinking, to the best of my knowledge, it's not generally illegal to let people drink in the office. And I don't doubt that some employees would find it attractive to do so.
Drinking on the job isnt illegal, got any jobs going at IPVM.. Asking for a friend ;)
I'm not sure of the laws in California - I've never lived there. However almost every company I have worked for since I was 16 years old has had some form of alcohol involved at work. None of them have been as blatant as it sounds Verkada is being, but it's happened even at some of the largest, most conservative companies in the country.
I think like most things, as long as you handle things professionally there should be some leeway.
Probably not illegal, but wouldn’t allowing drinking on the job open the company up to liability if an employee got drunk and fell out a window or drove home drunk and killed someone? I would think some lawyers would be all over that kind of thing.
Yes, any company could be liable if they allowed (and encouraged) an employee to drink at work and who accidentally killed someone while driving drunk; even worse if the company made the alcohol available to the employee. The CEO of Verkada is negligent and idiotic for allowing this type of practice, in my opinion.
There is nothing wrong with working hard and being aggressive. Running down every little deal like your life depended on it.
But that does not mean you need to be toxic work environment. You can do both and I have seen many women succeed in this type of high pressure sales. I don't think gender has much to do with it.
I went to school with a guy who scoffed at workplace decorum, once telling me “I don’t care if you sit and jack off at your desk, as long as you make me money.”
He went on to get fired by a bulge bracket bank for an ethics violation.
Is Verkada hiring? He might be a good fit on the sales team.
BONUS: He’s not white.
Just spat my Whiskey out all over my Office desk... :D :D
Seems like they are “Disrupting” things...
This is where leadership needs to come in. My guess is that they broadcast too much rather than listen. For all of us, its important to take this as a lesson. Be sure to take surveys from your team, make it anonymous and make sure your aligned with your staff as much as you want your staff aligned with your company.
This is on Verkada to make a change. To simply deflect and claim just the wins is disgusting.
I agree! However, this is on us to actually force a change. If a director is creating and sharing explicit photos on women on their team, it's clearly time for someone other than their leadership to step in. It's clear deflect and deny is their strategy.
IPVM - glad you wrote this article, but I hope you go a step further and make this a public article. This is bigger than those of us who discuss industry events under this paid platform - this is something every employee they aggressively recruit and every company not wishing to support this conduct should have access to before making their decision.
Would you want Verkada on your resume?
If I was applying for a Bartender job? Yes.
That's not really a relevant question when they recruit with their best foot forward and those people do not (likely) have access to this information behind a paid platform.
Maybe time for an updated version of "The Smartest Guys in the Room" movie.
As regards drinking at work, it may not be illegal, but their insurance carrier would have a fit!
I worked at EMC back in the early days. Not so early as when they were a reseller (yes, that's how they started), but when they were a memory company and just transitioning into disk subsystems. It makes me laugh when people try to copy what another company does without understanding why it worked for them.
EMC had early explosive growth by tapping into a market where price gouging was taking place and offering a product that was just as good for half the price. Digital Equipment, IBM, and Prime Computer were selling memory cards in the range of $50k-100k for their minicomputers and mainframes. EMC reverse-engineered these boards and was able to sell them for half that price. Even then, the boards only cost a few thousand dollars to make, so the margins were phenomenal. (One year, EMC had ~$60M in revenue and ~$20M in profits.)
They had a product that would practically sell itself. The sales team just needed to get in front of the customer and go through the script. So an aggressive sales team was perfect for them. Plus, they had a very extensive sales training program for new employees that would take weeks to complete. Combine that with the fact that a frat-boy mentality was more tolerated back (late 80s) then and the fact that there was no social media to shine a light on bad behavior, and you get a solution that worked very well financially for EMC. It may work for Verkada as well, but I don't think that the sale is as mindless as it was for EMC back in the day, plus bad behavior no longer is swept under the rug. (BTW, as EMC transitioned to disks, the sales teams needed to get more technical.)
Note that I was on the technical side, so I didn't have much visibility into the sales side - I always interacted with the product management team. I never heard any stories of harassment, but it was certainly a male-dominated team, so I wouldn't be shocked to hear that it occurred. I remember that they had a large bell and a small bell in the sales/marketing area of the building. Every time a sale occurred, they would ring the bells as appropriate (one ding on the big bell = $100k, one ding on the small bell = $10k). Everyone would stop what they were doing and clap when the bells were rung. It was definitely a sales-driven company, like Verkada is.
without question they are planning to sell the company and they hope to get $2.4B this time. Thats how they measure their sticks in the valley. the only number that matters is the size of the liquidity event. the only question is who will buy Verkada and how will they change it?
I think you hit the nail on the head. Oh, and have fun while doing it.
This is why focused leadership is important.
"Disruption" isn't really a useful goal on its own, and teams who overvalue "disruption" often turn into weird unfocused feral herds whose dopamine centers automatically start firing whenever they see anyone thumb their noses at conventional wisdom.
In my experience it is very rare the anybody is ever really terminated in these situations as the really strong sales folks are hard to find and replace, so in this situation I find it hard to believe that terminations actually happened. Verkada is a VC funded company and I would not be surprised if the VC's don't force change in the culture but only to the degree that it does not interfere with their investment.
It would be interesting to know if change ever takes place in this company but I doubt it will.
Verkada is not going to let ANYTHING stand in the way of sales. These things will be considered collateral damage and chalked up as a by-product of a aggressive sales team. Sort of a "boys will be boys" attitude.
I would like to know if those who were disciplined were those who were the offenders, or those who spoke out about it. Usually in these situations, those who speak out are the ones who suffer the penalties, and the offenders are made to look like the victims. In much the same way IPVM could be viewed as attacking Verkada and Verkada are now victimized by unfair criticism.
How is the criticism unfair if true? Are you saying that Matt Lauer was the victim and that the women who came out and told the truth should have been fired?
This is often how these things get spun in the narrative, especially by those who are perpetrating these types of behaviors.
One would hope that Verkada is not viewed as the victim here. Especially since the actions detailed in the article be considered sexual harassment in the workplace. Could there be civil and criminal liability?
In today's world, it is hard to imagine a company condoning this type of behaviour but that is in essence what CEO's response appears to do. Basically, 'if you get caught, it may cost you some stock options, so don't get caught and keep 'focused' (keep doing what you are doing)'. Maybe it should have been, 'Let me be clear, if you engage in any inappropriate behaviour you will be terminated. Period.'
The merit of the IPVM article is that it gives insight into how the company operates regarding the behaviour it allows. This article, plus the others, appears to show that nothing is considered to be out of bounds. If 'anything goes', does it raise the question of how they might treat customers and dealers?
In defence of IPVM, does anyone think they would have written the article differently if it was about Axis, Avigilon, or a 'fever screening' camera claim?
It already is that way with customers. Once a sale is made, they could care less about them. The biggest problem is that they don't sell solutions, they push product. Any product. Often times selling customers things they don't need or that don't fit the customers needs. Think of the old image of a used car salesmen.
UPDATE: Business Insider has covered our story on Verkada. It's mostly a summary of our reporting but adds a new statement from Verkada "that it is providing coaching for managers and mandatory sexual harassment training, as well as expanding the human resources team, to make the workplace safe for all."
The rest of the statement Verkada provided to BI reads:
Verkada is committed to creating a workplace that is respectful and inclusive of everyone. We take our policies very seriously, and there have been and will continue to be repercussions for anyone who have been and will continue to be repercussions for anyone who violates them. Every employee is expected to operate with high standards of conduct, and any behavior that runs counter to these values is not tolerated
What year is this? It astonishes me that what I assume is a very young Gen-Z workforce, who would ostensibly be super-woke through no fault of their own, can still be so stupid.
Say what you want about the overwhelmingly male nature of the security industry but even fat old fifty year old security managers know this sort of thing is wrong.
That the offending staff were given the option to resign (rather than be summarily fired) is astonishing enough. That behind door number two however was the option of merely surrendering stocks, in a world where entire careers are cancelled for a mere tweet, is remarkable.
I have been often critical of the Verkada marketing and business model so I feel compelled to add a counterpoint.
We are a large institution with at least 4500 FTE employees even after laying off ~15 -20% of our workforce in recent months. We have a 24/7 police force and EMS that also manages our fire and intrusion alarm response, cctv and other public safety systems and activities. One of our 4500 employees became concerned about security of the high end videoconferencing equipment being installed, well EVERYWHERE. Rather than reach out to our professional police department with their concern, this staff member reached out to our Verkada rep.
Rather than try to quietly sell Verkada into the "side door", our Verkada rep forwarded the email to me and asked for guidance. This was the right choice and it gives me some renewed confidence in at least our Verkada rep. I have spent hours in webexes and countless follow up meetings where we get updated on Verkada and I explain in great detail why it is still not a good fit for our company.
So instead of sidestepping the gatekeeper (ME) and getting some product in place to surprise me and our company at a later time, this Verkada rep CHOSE to do the right thing. Good on him and he reflects well on Verkada. Still not a good fit for us but this unlocked a door that I had considered locked and bolted just last week.
Notably, out of 13 people on Verkada's Leadership Team page, zero are women.
Update: Dervilla Lannon has been promoted to VP of Human Resources, she updated her LinkedIn profile showing that in the past week, though she is not yet listed on Verkada's Leadership Team page.
We're just waiting on a new headshot per her request :). Thank you!
Update, December 2020: IPVM has released a video summarizing the events:
robertson’s own demeanour in videos to his own staff to me hint at discriminatory, intolerance, and just general arrogance (king shit disrupting an industry, ya right!).
true that this practice has been in play in the industry for a long time, however this is no excuse, and there are many of us in the industry that are trying to rid our environment of this practice. Sad to see a company that speaks of innovation fall back to the locker room mentality.
ive had the privilege to watch people like this get walked out of corporate positions for exactly this type of behaviour.
Hearing the sales pitch from these guys makes you think they should be the only players in our industry, if one didn’t have any industry experience it would be hard to see what a clown show this company really is.